[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]


   AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND 
                RELATED AGENCIES APPROPRIATIONS FOR 2010 

_______________________________________________________________________

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                      ONE HUNDRED ELEVENTH CONGRESS
                              FIRST SESSION
                                ________

     SUBCOMMITTEE ON AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 
                  ADMINISTRATION, AND RELATED AGENCIES

                ROSA L. DeLAURO, Connecticut, Chairwoman
 SAM FARR, California                       JACK KINGSTON, Georgia
 ALLEN BOYD, Florida                        TOM LATHAM, Iowa
 SANFORD D. BISHOP, Jr., Georgia            JO ANN EMERSON, Missouri
 LINCOLN DAVIS, Tennessee                   RODNEY ALEXANDER, Louisiana
 MARCY KAPTUR, Ohio
 MAURICE D. HINCHEY, New York
 JESSE L. JACKSON, Jr., Illinois   

 NOTE: Under Committee Rules, Mr. Obey, as Chairman of the Full 
Committee, and Mr. Lewis, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.
      Martha Foley, Leslie Barrack, Cliff Isenberg, and Matt Smith,
                            Staff Assistants
                                ________
                                 PART 3
                                                                   Page
 Domestic Nutrition Programs......................................    1
 Department of Agriculture........................................  135
 Testimony of Members of Congress.................................  279
 Secretary of Agriculture.........................................  321

                                ________
         Printed for the use of the Committee on Appropriations


 PART 3--AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION,

              AND RELATED AGENCIES APPROPRIATIONS FOR 2010
                                                                      














 
   AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND 
                RELATED AGENCIES APPROPRIATIONS FOR 2010 

_______________________________________________________________________

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                      ONE HUNDRED ELEVENTH CONGRESS
                              FIRST SESSION
                                ________

     SUBCOMMITTEE ON AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 
                  ADMINISTRATION, AND RELATED AGENCIES
                ROSA L. DeLAURO, Connecticut, Chairwoman
 SAM FARR, California                       JACK KINGSTON, Georgia
 ALLEN BOYD, Florida                        TOM LATHAM, Iowa
 SANFORD D. BISHOP, Jr., Georgia            JO ANN EMERSON, Missouri
 LINCOLN DAVIS, Tennessee                   RODNEY ALEXANDER, Louisiana
 MARCY KAPTUR, Ohio
 MAURICE D. HINCHEY, New York
 JESSE L. JACKSON, Jr., Illinois  

 NOTE: Under Committee Rules, Mr. Obey, as Chairman of the Full 
Committee, and Mr. Lewis, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.
      Martha Foley, Leslie Barrack, Cliff Isenberg, and Matt Smith,
                            Staff Assistants
                                ________
                                 PART 3
                                                                   Page
 Domestic Nutrition Programs......................................    1
 Department of Agriculture........................................  135
 Testimony of Members of Congress.................................  279
 Secretary of Agriculture.........................................  321

                                ________

         Printed for the use of the Committee on Appropriations

                     U.S. GOVERNMENT PRINTING OFFICE
 53-443                     WASHINGTON : 2010



















                       COMMITTEE ON APPROPRIATIONS

                   DAVID R. OBEY, Wisconsin, Chairman

 JOHN P. MURTHA, Pennsylvania              JERRY LEWIS, California
 NORMAN D. DICKS, Washington               C. W. BILL YOUNG, Florida
 ALAN B. MOLLOHAN, West Virginia           HAROLD ROGERS, Kentucky
 MARCY KAPTUR, Ohio                        FRANK R. WOLF, Virginia
 PETER J. VISCLOSKY, Indiana               JACK KINGSTON, Georgia
 NITA M. LOWEY, New York                   RODNEY P. FRELINGHUYSEN, New   
 JOSE E. SERRANO, New York                 Jersey
 ROSA L. DeLAURO, Connecticut              TODD TIAHRT, Kansas
 JAMES P. MORAN, Virginia                  ZACH WAMP, Tennessee
 JOHN W. OLVER, Massachusetts              TOM LATHAM, Iowa
 ED PASTOR, Arizona                        ROBERT B. ADERHOLT, Alabama
 DAVID E. PRICE, North Carolina            JO ANN EMERSON, Missouri
 CHET EDWARDS, Texas                       KAY GRANGER, Texas
 PATRICK J. KENNEDY, Rhode Island          MICHAEL K. SIMPSON, Idaho
 MAURICE D. HINCHEY, New York              JOHN ABNEY CULBERSON, Texas
 LUCILLE ROYBAL-ALLARD, California         MARK STEVEN KIRK, Illinois
 SAM FARR, California                      ANDER CRENSHAW, Florida
 JESSE L. JACKSON, Jr., Illinois           DENNIS R. REHBERG, Montana
 CAROLYN C. KILPATRICK, Michigan           JOHN R. CARTER, Texas
 ALLEN BOYD, Florida                       RODNEY ALEXANDER, Louisiana
 CHAKA FATTAH, Pennsylvania                KEN CALVERT, California
 STEVEN R. ROTHMAN, New Jersey             JO BONNER, Alabama
 SANFORD D. BISHOP, Jr., Georgia           STEVEN C. LaTOURETTE, Ohio
 MARION BERRY, Arkansas                    TOM COLE, Oklahoma
 BARBARA LEE, California                     
 ADAM SCHIFF, California
 MICHAEL HONDA, California
 BETTY McCOLLUM, Minnesota
 STEVE ISRAEL, New York
 TIM RYAN, Ohio
 C.A. ``DUTCH'' RUPPERSBERGER, Maryland
 BEN CHANDLER, Kentucky
 DEBBIE WASSERMAN SCHULTZ, Florida
 CIRO RODRIGUEZ, Texas
 LINCOLN DAVIS, Tennessee
 JOHN T. SALAZAR, Colorado          

                 Beverly Pheto, Clerk and Staff Director

                                  (ii)


   AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND 
                RELATED AGENCIES APPROPRIATIONS FOR 2010 

                              ----------                              

                                          Thursday, March 12, 2009.

                      DOMESTIC NUTRITION PROGRAMS

                               WITNESSES 

THOMAS O'CONNOR, ACTING DEPUTY UNDER SECRETARY, FOOD, NUTRITION, AND 
    CONSUMER SERVICES, U.S. DEPARTMENT OF AGRICULTURE
KELLY D. BROWNELL, Ph.D., PROFESSOR OF PSYCHOLOGY, EPIDEMIOLOGY AND 
    PUBLIC HEALTH, AND DIRECTOR OF THE RUDD CENTER FOR FOOD POLICY AND 
    OBESITY, YALE UNIVERSITY
LYNN PARKER, MEMBER, COMMITTEE ON NUTRITION STANDARDS FOR FOODS IN 
    SCHOOLS, FOOD AND NUTRITION BOARD, INSTITUTE OF MEDICINE, THE 
    NATIONAL ACADEMIES

                            Opening Remarks

    Ms. DeLauro. The committee is called to order. My apologies 
for being late.
    The Budget Committee met today as well, but it was an 
interesting exchange because the Secretary of Education was 
there, and we had an opportunity to talk about school nutrition 
in that context, as well as having an opportunity to be here 
with all of you today.
    Let me just say thank you to everyone, and to welcome you 
this afternoon, especially to our witnesses, Mr. O'Connor, 
Acting Deputy Under Secretary for Food, Nutrition and Consumer 
Services; Kelly Brownell from Yale University's Rudd Center for 
Food Policy and Obesity; and Lynn Parker, representing the Food 
and Nutrition Board, the Institute of Medicine and the National 
Academies. I truly do; and we are all grateful to you for 
taking the time to be with us today to share your experience, 
to share your insight on what is a critical issue going forward 
for this Nation.
    If I might just take a second, I would like to welcome the 
newest member of our subcommittee, and that is Congressman 
Lincoln Davis, who is from Tennessee. He not only sits on the 
Appropriations Committee, he is a former member of the Ag 
Committee, Financial Services and served on the Science 
Committee.
    So delighted to have you and your experience in this 
effort, Mr. Davis. So, welcome.
    Mr. Davis. It is a pleasure. Thanks.
    Ms. DeLauro. Let me also welcome back all of the 
subcommittee members. We come together today with a 
comprehensive agenda for the year ahead to try to build on all 
that we tried to achieve in the last Congress. And last year we 
convened the six budget hearings or the regular budget 
proceedings, and through the work of the subcommittee we worked 
hard to increase resources and improve management at the 
agencies under our jurisdiction in an effort to provide some 
what we regarded as needed reform.
    We called numerous oversight hearings on drug safety, food 
safety, rural development and the impact of the speculation on 
oil and food prices, all a part, if you will, of a mission to 
highlight and to pursue critical questions in public health, 
consumer safety and economic growth.
    I have enjoyed working together with my colleague, the 
ranking member, Mr. Kingston, from Georgia. I look forward to 
collaborating with you, Jack, and the entire subcommittee in 
our months ahead.
    We will be writing a new appropriations bill and working to 
preserve and strengthen our rural communities, support local 
businesses pushed to the brink by the spiraling economy, 
protect public health, address safety and think big about 
problems like energy and other issues that are here today; but 
we need to think beyond that in what is coming up.
    So we begin today with a hearing on public health, the 
first in a series on nutrition where I hope we can look at 
fighting hunger, making nutritious food accessible and 
exploring the Federal Government's responsibility.
    For decades, our Nation's nutrition programs under the 
Department of Agriculture have been a big part of our social 
safety net, providing children and low-income families with 
access to quality food; and over the last year we have made 
progress. With the farm bill, we took critical steps after 
years of erosion in food stamp benefits, increasing the 
standard deduction from $134 to $144, then indexing it to 
inflation. And we worked out increasing the minimum benefit to 
$14 from $10, where it had been frozen for the last 30 years, 
and then indexing that to inflation as well.
    The fact is, one in five Americans is affected by nutrition 
programs under the Food and Nutrition Service at USDA. We have 
to ask ourselves in terms of where we want to try to go today. 
Are we using the USDA as a positive force for change? Are we 
doing families and children good? Or are we contributing to 
their poor nutrition, their obesity and other health-related 
problems? Do we understand the full consequences of our choices 
not only from specific programs like WIC or the school lunch or 
breakfast program, but also when it comes to our far-reaching 
subsidy policies?
    The latest statistics are overwhelming. Two-thirds of 
adults are overweight today. The trend lines are not promising. 
In the past 20 years the percentage of adolescents who are 
overweight has more than tripled, and the habits most people 
take up as children and in school stay with them their whole 
lives. Diabetes and other dangerous health problems are on the 
rise, costing our economy millions.
    So with this hearing we are going to look at, or begin to 
look at, and probe the answers to what role can the Congress 
play in fighting hunger, combating obesity, improving 
nutrition. In particular, this subcommittee: How can we apply 
the power of the purse to bring change? What is the 
administration's current proposal? Will it make an impact in 
charting a new course? Are our policies contributing to poor 
nutrition and obesity?
    According to the Center for Science in the Public Interest, 
the food industry spends about $10 billion a year marketing 
food to children. Considering their significant influence and 
control, can we succeed in any significant behavioral change? 
Can we exercise controls or influence in this direction in the 
way that we did with cigarette smoking? What place should 
competitive foods, which are not required to meet any 
significant nutrition standards, have in our schools? How can 
we collaborate with the Department of Health and Human Services 
and the Department of Education?
    I read an article where Alice Waters says that the 
Department of Education should put up funding for the school 
nutrition piece as well as Agriculture. So how do we make the 
dietary guidelines stronger and meet good nutritional values?
    For our witnesses: If you would make any changes, what 
would they be? From WIC to SNAP to the school lunch program 
there are many powerful tools that we have, and we have used 
them to achieve a lot of good over the years; but in fact, I 
believe we have lacked coordination and long-term vision to 
take full advantage of their potential. Our question, going 
forward, is how to get all these programs working together 
effectively in the same direction. How do we harness their 
reach and their impact and apply it to a larger and a more 
comprehensive campaign to strengthen healthy diets, healthy 
weights and active lifestyles? The Agriculture appropriations 
bill and the Child Nutrition and WIC reauthorization bill will 
be important next steps.
    I thank our witnesses for participating this afternoon. I 
look forward to your testimony.
    In dire economic times like these, families and children 
should never be forced to choose between securing healthy food 
for their children and providing health care, shelter and the 
other basics they need just to get by. For many families, the 
USDA's nutrition programs make the difference. Now is our 
opportunity to make them better.
    And with that, let me ask Ranking Member Mr. Kingston if he 
would like to make an opening statement.
    Mr. Kingston. No, I do not, Madam Chair. I don't know if 
anybody else does, but I will certainly yield back.
    Ms. DeLauro. What I will ask our witnesses to do now is to 
make their statements. You understand fully that your remarks, 
in toto, will be in the Congressional Record, so if you can 
summarize your remarks, that would be appreciated, and then we 
can move to a dialogue.
    I will say this: This committee likes to have a dialogue, 
so it is not stovepiped here. What we hope to do is to engage 
you, to engage with one another and us to be able to engage 
with you on these issues.
    Mr. O'Connor.

                           Opening Statement

    Mr. O'Connor. Thank you. Thank you, Madam Chairwoman and 
members of the Subcommittee, for the opportunity to be here 
today. I am the Acting Deputy Under Secretary for the Food, 
Nutrition and Consumer Services.
    When I joined FNCS over 30 years ago, I joined a group of 
dedicated colleagues committed to filling the agency's primary 
mission, which is the eradication of hunger and malnutrition in 
America. Galvanized by the revelation of the terrible hunger 
problems that existed in the 1960s, Congresses and 
Administrations ever since, working in a bipartisan fashion, 
have assembled a nutrition safety net that has achieved 
remarkable success combating hunger.
    Hunger remains a significant problem in the United States. 
It no longer is of the magnitude that it was before these 
programs were established. The 15 programs administered by USDA 
are a safety net that responds to changing economic conditions, 
expanding and contracting as needed. We see this at work right 
now as our programs reach all-time highs in participation to 
serve those currently experiencing economic hardship.
    Hunger is not the only nutrition challenge that the Nation 
faces. Over the past decade, the number of people who are 
overweight and obese has increased significantly. The evidence 
is clear and overwhelming that this problem is reaching 
epidemic proportions and cuts across all populations of our 
Nation. The latest data from the Centers for Disease Control 
and Prevention shows that 66 percent of adults are overweight, 
as you pointed out, and 32 percent of those are obese. Even 
more alarming, almost one in five children in adolescence is 
overweight.
    While there is no evidence that singles out any particular 
group as more prone to this problem than another, the fact that 
our program served one in five Americans during the course of a 
year positions us to play a part in addressing this alarming 
health trend.
    The reasons why people are overweight and obese are 
straightforward: We eat too much, we exercise too little. But 
effecting changes in those behaviors that need to be made are 
not easy. However, we are committed to doing all that we can to 
encourage people to change behaviors.
    Our Center for Nutrition Policy and Promotion created My 
Pyramid, the most recognized nutrition icon in the world, and 
through MyPyramid.gov, which has had over 7 billion hits--100 
million each month--and related products, we are continually 
trying to educate the general population about good nutrition 
and healthy lifestyles.
    Within our programs we have expanded nutrition education 
efforts dramatically, spending more than $750 million in 2008, 
improved the qualities of foods provided in school meals and 
the commodity programs, in part by providing more fruits and 
vegetables, and we have updated and improved the nutritional 
value of the WIC food packages. We have initiated public 
awareness campaigns in English and in Spanish to provide a 
broad reach for our nutrition messages, and we are testing ways 
to use initiatives at the point of purchase to change people's 
buying habits.
    There is no magic bullet to solving the epidemic of 
overweight and obesity. There is no one answer, no one agency's 
issue to address, nor indeed is it just the government's role 
alone. The problem didn't appear overnight, and it won't be 
solved overnight.
    But like the fight against hunger, we can achieve success 
in the fight against obesity. It takes commitment, 
perseverance, creativity, collaboration and partnership across 
all levels of government; and with the private sector, USDA is 
committed to being a part of the solution and responding to the 
challenge as it did and continues to do in addressing the 
challenges of hunger.
    Madam Chairwoman, I appreciate the opportunity to make this 
presentation and would be happy to answer any questions that 
you or your colleagues may have.
    Ms. DeLauro. Thank you very much.
    [The information follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Ms. DeLauro. Dr. Brownell.
    Mr. Brownell. Thank you for the invitation to address the 
committee. I appreciate all the leadership on public health 
issues. My name is Kelly Brownell and I am a professor of 
psychology at Yale University, former Chair of the Department 
of Psychology, Director of the Rudd Center for Food Policy and 
Obesity.
    I begin today with several points regarding the role that 
food plays in modern life and how our relationship with food 
has evolved and how important the USDA can be as a force for 
change. I often begin talks before an audience by showing a 
list of ingredients for common food and having the audience 
guess what food that is. And if you see my written testimony, 
you will see the list of ingredients on this particular food, 
which is 48 items strong. And the fact that food can have 48 
different things in it shows how different our relationship 
with food has become.
    It used to be--there was a time that if we had such a thing 
as food labels there would have been one thing on it. It would 
have the food. It would have been an orange, lettuce, an apple, 
whatever; and now we have many, many ingredients.
    We don't really know what most of these things do to us. 
There is interesting research that has come out recently on the 
possible addictive nature of some ingredients of food. But that 
aside, our relationship with food has become physically distant 
and psychologically distant; and changing this situation I 
think could take us very far down the road of improving public 
health.
    Now it so happens that this list of ingredients sums up to 
be a Chocolate Chip Cookie Dough Pop Tart, but those 40 things 
could be mixed in different ways to produce lots of foods that 
are in the food environment. But the fact that we don't really 
know what is going into the foods that we eat and we are so far 
from the food and who creates it, a number of problems have 
developed from them.
    One could actually ask if some of these things should be 
called ``a food''--Michael Pollan has written about this--and 
one could legitimately ask whether a product should be called a 
food, not because we eat them necessarily, but are they found 
in nature? Do they create metabolic havoc once they enter the 
body? Do they interfere with life expectancy or promote it? And 
these things are really very interesting questions, and beyond 
the scope of what we are talking about today, but they do show 
our changed relationship with food.
    When we talk about food and our vision of what is 
acceptable to eat, it is shaped tremendously by the food 
industry. We have been trained as a nation to believe that you 
can throw vitamins in water, sugar water, and that it is a 
healthy thing to take in. We have been trained to believe that 
something doesn't have to have fruit in it to bear fruit in its 
name.
    A number of things like this have occurred that talk to the 
power of marketing. And foods marketed, much like alcohol and 
tobacco, become attractive in part because they are associated 
with being cool, fun, athletic, popular, et cetera. And you 
will see how often, if you pay attention to food marketing--how 
seldom, that is--the properties of the food themselves are 
measured. Very seldom do we hear that the food tastes good or 
that it does something good for us; it is mainly about its 
associated properties. So change in this system won't be easy. 
Food policy is affected by factors deeply woven in the 
economics and politics of our country.
    I am very heartened by Secretary Vilsack's comments about 
nutrition being at the heart of agriculture policy, which I 
think represents a significant change and could take us down 
some very good roads. I would like to mention also the 
possibility of considering guiding philosophy: As we are going 
ahead with changing nutrition to affect public health is there 
a way to put all of this together into a central philosophy?
    And I would like to introduce the concept that the 
economists use called ``optimal defaults''; and the basic idea 
there is that you can create changes in the environment that 
make healthy behavior the default rather than unhealthy 
behavior the default. And there are stunning examples of the 
success of these approaches.
    I will just use one in the health area unrelated to 
nutrition. It has to do with the percentage of people who agree 
to be organ donors in different countries. European countries 
break down about 60/40 percent into those that use the U.S. 
model, where you are not an organ donor by default, but you can 
choose to be one versus countries where you are an organ donor 
by default, but you can opt out if you wish--the same set of 
choices under both circumstances, just the default differs.
    And the rates are remarkably different of organ donation. 
In the countries that use the U.S. model, where you are not one 
by default, about 15 percent of people agree to be organ 
donors; in the countries where you are a donor by default, it 
is 98 percent.
    Now, that is a startling difference; and one could imagine 
if you tried to accomplish that with education, you could do an 
educational campaign. With unlimited money, you could never get 
that number up to 98 percent or you could just change the 
default.
     And so the question is, are there nutrition equivalents of 
this? Are there optimal defaults that can be created in the 
nutrition environment in order to help make healthy behavior 
the default rather than the opposite? And now, with portion 
sizes so large, marketing as it is, unhealthy foods priced to 
be more accessible than healthy options, there are a number of 
factors that bear down on people to make poor choices the 
default.
    Now, we could use food marketing as an example here. If we 
added together all the government programs that deal with 
nutrition education and see what it summed to--let's say 100 
million, let's say 500 million, whatever it happened to be--the 
food industry spends that in the month of January to basically 
convince people to eat unhealthy foods, with a few exceptions, 
but mainly that is the case--sugared cereals, soft drinks, fast 
food, candy and the like. And much of this advertising is 
directed to children. So that creates an unhealthy default.
    As long as that marketing is out there, to the extent it 
is, it is hard to imagine the population eating a healthy diet.
    But, of course, there are many other things that can be 
done as well. So the question is, what role can USDA play in 
this? I would like to break down my remaining comments into 
ways that existing programs might be strengthened and then 
discuss a few new initiatives that my colleagues and I thought 
about.
    First, in terms of strengthening existing programs, I would 
like to talk first about children and schools. First is the 
issue of what shouldn't be in schools. The list of competitive 
foods that exist now is much too lax; tightening up the 
standards would be a big help in terms of school nutrition, and 
the Institute of Medicine has excellent standards that could be 
used to guide those decisions.
    Next is the issue of what needs to be in schools. The Fruit 
and Vegetable Program administered by the Department of Defense 
is an excellent start and can be strengthened even beyond where 
it is now. Better financing for breakfast and lunch programs 
would give the opportunity for schools to buy healthier foods 
rather than rely on the low-cost, unhealthier options.
    Locking in school wellness policies would also be an 
excellent thing to do. In the 2004 Child Nutrition 
Reauthorization Act, school districts were required to develop 
school wellness policies; and colleagues of mine at the Rudd 
Center, Drs. Marlene Schwartz and Katherine Henderson, have 
done excellent work to find out that the school wellness 
policies do matter and that the school districts with stronger 
policies tend to have better nutrition practices, as well as 
other practices related to health.
    Next, I would like to talk about the Child and Adult Care 
Food Program, CACFP. Those programs could be strengthened by 
having higher nutrition standards. Both pertain to what is 
allowed and what is not allowed in the programs.
    Next, on the WIC and food stamp front, of course, a 
tremendous opportunity here to improve things. I would 
encourage less emphasis on direct education, although education 
sounds like a good thing, and we all believe in it, and it 
seems like a pretty good idea; but there is not a lot of 
evidence suggesting that education is having the desired impact 
or that it is worth the money spent on it.
    And so the question is, do we try to educate our way out of 
unhealthy diets or do we do things like changing defaults? And 
an example of this, a real-world example, would be New York 
City where the health commissioner and the Department of Health 
passed a regulation that forbids restaurants to have trans fats 
in the restaurant foods.
    Now, again, you could try to accomplish that with education 
and never get to the goal or you can just change the default: 
You get rid of the trans fats.
    And so, again, I go back to the question, in WIC and food 
stamps, can we create better defaults? And then I will end with 
the following.
    Is that my cue to stop?
    Ms. DeLauro. No.
    Mr. Brownell. Okay.
    Ms. DeLauro. Keep going.
    Mr. Brownell. I am almost done anyway.
    And then another thing that could be improved with WIC and 
food stamp programs is, the USDA has pretty strict rules on 
what States can say about specific foods. And States--and we 
have talked to some people in some States who feel hamstrung by 
not being able to produce written materials that say people 
should eat less of anything in particular. So they can't 
recommend, for example, that people should drink less sugared 
beverages or eat less fast food or eat fewer french fries or 
things like that, because of this censoring rule. And if that 
could be changed, it would provide more flexibility for States 
to be more aggressive with the messages they give people.
    Position of and reimbursement for better foods within those 
programs would be helpful, too.
    In terms of new initiatives, I would recommend several 
things. One is, I would like to see somewhere in government a 
commission established that would simultaneously address 
hunger, obesity and the environmental consequences of modern 
food practices. These are all very pressing issues. Depending 
on who you talk to, hunger is a major problem, obesity is a 
major problem, the environmental degradation produced by modern 
food practices is a problem. But these worlds of people very 
seldom interact, and sometimes even have competing needs.
    An example would be the green revolution which has helped 
feed the environmental world, but at an environmental cost. And 
so, are there ways that these worlds could come together and we 
could create win-win-win for hunger, obesity and sustainability 
issues? I believe there can be, but again, these worlds aren't 
talking very much.
    I would recommend a great deal more emphasis on farm-to-
school programs; and this, apropos of Chairwoman DeLauro's 
comments about Alice Waters, who has championed this issue. 
Children, because of the way they are raised in the United 
States now, have very little relationship with food. Fewer and 
fewer people know how to cook these days. You have schools that 
aren't doing a very good job teaching kids nutrition; and so 
strengthening those programs would be a big help.
    And then I will end with recommendations for two studies I 
would recommend the IOM, the Institute of Medicine, be 
commissioned to do. One would be a study on the economic and 
health impact of farm subsidies. There is a lot of debate about 
farm subsidies now. Michael Pollan and others have written 
about it extensively. And as I talk to my economist friend, I 
get the sense that this a far more complex topic than one might 
see if you just read the press.
    And it is not a simple issue of corn farmers get subsidies, 
and therefore, we are helping drive obesity; but it is actually 
a very complicated topic that deserves the sort of thoughtful 
analysis that the Institute of Medicine could provide. So I 
would like to see that with some specific recommendations about 
how subsidy programs might be harnessed in order to improve 
health.
    And then, second, I would recommend the Institute of 
Medicine be commissioned to do a study on the impact of food 
prices and access, especially in vulnerable populations, on 
ultimate diet and health and whether we can change food prices 
and access in a way that helps these vulnerable populations 
maintain their health.
    Thank you very much.
    Ms. DeLauro. Thank you, Dr. Brownell.
    [The information follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Ms. DeLauro. Ms. Parker, that was a vote, as you know, so 
we will hear your testimony and then we will sort ourselves out 
from there.
    Ms. Parker. Thank you. Good afternoon, Madam Chair and 
members of the committee. Thanks for the opportunity to be with 
you here today.
    My name is Lynn Parker, and I am a scholar at the Institute 
of Medicine at the National Academies. Prior to coming to the 
Institute of Medicine, I was a member of the Committee on 
Nutrition Standards for Foods in Schools at the Institute of 
Medicine, so was involved with that committee in writing the 
report that I am going to talk about today--Nutrition Standards 
for Foods in Schools: Leading the Way Toward a Healthier Youth.
    The Institute of Medicine was established in 1970 under a 
charter with the National Academies to provide independent, 
objective and evidence-based advice to policymakers, to health 
professionals, the private sector and to the public.
    In 2005, in the wake of the rising rate of obesity and also 
the increasing availability of high-calorie, low-nutrient foods 
in schools that were being served and offered in competition 
with the school lunch and breakfast programs, Congress directed 
the Centers for Disease Control to undertake a study with the 
Institute of Medicine to review the evidence and make 
recommendations about what would be the appropriate nutrition 
standards for foods that are offered in competition with the 
reimbursable school lunch and breakfast programs.
    The need for such standards is simple, and I think people 
have already sort of talked a little bit about that. While we 
have federally reimbursed school meals that have to meet 
nutrition standards, the competitive foods that are offered in 
competition with those meals do not have to conform to very 
much of a standard at all. It is a very limited standard; and 
some people are surprised to hear that these foods only have to 
meet less than--the only foods that are prohibited are those 
that have less than 5 percent of eight key nutrients.
    So we are talking about foods that are very low in 
nutrients that are actually being prohibited from being served 
in competition with school meals. And also, the only control is 
around the cafeteria and during the meal period, so anything 
that happens before or after a meal period or anything that 
happens nearby the cafeteria is okay.
    To begin the process of developing these recommendations we 
developed a list of guiding principles to guide us in our work. 
And we wanted those guiding principles to lead us to creating a 
healthful eating environment for children in the United States. 
And I want to--there were several guiding principles, and they 
are in my testimony, but I just wanted to tell you a couple of 
them so you can see sort of where we were coming from.
    We said that schools contribute to the current and lifelong 
health and dietary patterns of children. Children are there all 
day long, 5 days a week a significant part of the year; and 
schools, because of that, are uniquely positioned to model and 
reinforce healthful eating behaviors among children. And we 
also said, in partnership with parents, teachers and the 
broader community.
    Also, we all agree that foods and beverages offered in the 
school campus should contribute to the overall healthy eating 
environment and to the long-term healthful eating habits of 
children and serve a basis for their habits in the future. And 
we looked at both the dietary guidelines as a guide for what we 
did and also other pertinent scientific information that is 
available.
    So, drawing on the Dietary Guidelines and the scientific 
data describing the current dietary intake of school-age 
children, what we found was that children are not--and this 
won't surprise you--are not eating enough fruits and 
vegetables, are not eating enough whole grains and are not 
drinking enough or eating enough low fat and nonfat dairy foods 
and beverages. And the Dietary Guidelines urge us to promote 
those four kinds of foods to children and encourage their 
consumption.
    So ultimately what we--and I am going to put my glasses on 
now--what we recommended was that the foods that are offered in 
competition with the school meals ought to be those foods that 
represent fruits and vegetables, whole grains and low fat and 
nonfat dairy products.
    We organized our competitive foods list--competitive foods 
and beverages list into two tiers to make a distinction about 
when certain foods should be allowed to be provided. Tier 1 
foods were those foods that we felt should be offered during 
the day, if a school chooses to offer competitive foods during 
the school day; and those foods include fruits and vegetables, 
whole grains, nonfat and low fat dairy products. And to give 
you some examples of the kinds of foods we are talking about, 
they would be things like apples, carrot sticks, raisins, some 
multigrain tortilla chips, granola bars and nonfat yogurt with 
limited added sugars.
    The second tier of foods that we recommended were those 
that meet certain standards, certain nutritional criteria--
reduced fat, saturated fat, additives and sodium--but don't 
necessarily have the full servings of fruits, vegetables, whole 
grains and so forth. And we suggested that as an option after 
school in high schools.
    So those of the guiding principles in those two tiers form 
the basis of our recommended nutrition standards for 
competitive foods and beverages. The standards have two 
objectives: to encourage consumption of healthful foods and 
beverages and to limit the consumption of dietary components 
like fat, saturated fat, sodium and added sugars that either 
fall outside the recommendations of the Dietary Guidelines or 
are just not optimal for the diets or health of school-age 
children.
    These standards are intended to ensure that competitive 
foods, snacks and beverages complement the School Lunch Program 
and meals and that they contribute to the development of 
lifelong eating patterns. In other words, if schools decide 
that they want to serve foods in competition with school lunch 
and breakfast, those foods should complement the School Lunch 
and Breakfast Programs and their goals, not compete with the 
School Lunch and Breakfast Programs and their goals. Those 
foods should be moving children toward the Dietary Guidelines 
and meeting the Dietary Guidelines rather than moving them away 
from meeting the Dietary Guidelines.
    One of the major purposes of the School Lunch and Breakfast 
Programs and their nutrition standards is to provide children 
with a diet and with meals at school that meet the Dietary 
Guidelines.
    The committee also recommended that the standards apply 
throughout the school campus and throughout the school day so 
that they are consistent throughout the day and that the 
message that children are receiving, the offerings that are 
available to them and what they are learning about what is best 
to be eating and consuming, are consistent throughout the 
campus and throughout the school day.
    So, in conclusion, the committee looked at the traditional 
school nutrition programs like breakfast and lunch as ones that 
are the major source of nutrition for kids and that should be 
providing access to healthful foods. If a school decides to 
offer competitive foods, then these offerings should encourage 
greater consumption of fruits and vegetables, whole grains and 
nonfat and low fat dairy products.
    It is our hope that as these recommendations are taken into 
account and implemented at the local, State and national level; 
that they move our schools toward providing children with a 
model of what good nutrition is; that they serve as a basis for 
kids understanding what a healthful diet consists of, so that 
they are available for them to consume and so that, as Kelly 
Brownell pointed out earlier, they are the healthy default, 
they are the foods that are available to kids.
    Thank you very much for the opportunity to testify, and if 
you have any questions about anything that I have said, I would 
be glad to answer your questions.
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    Ms. DeLauro. I think what we are going to do is--there are 
about 4 minutes left in the vote and then there are two 5-
minute votes after that. I think, with the concurrence of the 
committee, the subcommittee will just recess to go for the 
votes and then come back. Then we will take up the questioning.
    I beg your indulgence, but this is our way of life. Thank 
you.
    [Recess.]

                          NUTRITION EDUCATION

    Ms. DeLauro. We are going to get started. I know the other 
members are coming back. Again our apologies, but let's get 
started with questions.
    Mr. O'Connor, last year's hearing I asked about funds that 
FNS is spending on nutrition education. The FNS estimated that 
$788 million, Dr. Brownell, it is not 100 million, it is 788, 
and that doesn't include the State match money, which is 
somewhere near another 300 million or so.
    Over 95 percent of the funding is payment to State 
agencies, $305 million to food stamp agencies, 445 to WIC. 
About $19 million, as I understand it, goes to support 
nutrition education in schools.
    I am going to get my couple of questions out here and then 
give you time to answer and to interact.
    We need an overview of FNS programs and what you are 
currently doing on nutrition education that deals with the 
obesity issue. I am going to get right to the chase here. There 
is a 50 percent match from State, again which increases the 
total amount of the program. But my question is how do we know 
that we are getting anywhere with this nutrition education? 
What feedback do we get? What specific types of nutrition 
education are States implementing?
    I know you did some messaging last December on messages 
that work. Who analyzed it? What does it say? What is getting 
through? What changes should we be making on nutrition 
education to make it more effective? My question is, is $19 
million enough for schools?
    So that series of questions, this is the Appropriations 
Committee. We are sending this money this way. What is 
happening to it?
    Then I have a follow-up question. When you answer this one, 
I also want to get the other two panelists to answer it. Your 
testimony talks about, and I quote, ``concerns about the role 
of nutrition assistance and causing weight gain. USDA is not 
aware of any convincing evidence that school meals or other 
Federal nutrition assistance programs cause obesity or 
overweight. The evidence that does exist is mixed.'' That is a 
quote from your testimony.
    So with regard to that, when you address that I am going to 
ask Mr. Brownell and Ms. Parker whether or not they agree with 
that statement. Do they think there is any relationship to our 
nutrition assistance programs or the commodity programs and 
causing weight gain. So let me ask you to address the issues of 
our nutrition education programs and analysis of those efforts 
and their effectiveness.
    Mr. O'Connor. To the first question, where is the money 
going and what do we know about what we are getting back from 
it, we know that in the SNAP program, for example, where most 
of the money is going that you were just describing, where 
there is a State match, 52 of the State agencies have nutrition 
education programs that we are participating in the funding in. 
This is up over the last several years when there were many 
fewer----
    Ms. DeLauro. What is the effectiveness of the program?
    Mr. O'Connor. The effectiveness is something that we are 
still trying to assess.
    Ms. DeLauro. How?
    Mr. O'Connor. We have a new reporting requirement that we 
just put into effect, where we are going to be able to through 
collecting that information know better what all of the States 
are doing, and we are going to be sponsoring some projects 
looking at effectiveness to make sure that we can share what 
one State is doing that is effective with other States so that 
we can try to promulgate effective interventions from place to 
place to place.
    Ms. DeLauro. What is the timing on that?
    Mr. O'Connor. I believe we are about 2 years away from the 
results of that coming back in. So in the meantime----
    Ms. DeLauro. We are 2 years away?
    Mr. O'Connor. Right, in terms of trying to assess the 
effectiveness of what the State efforts are. In the meantime we 
have been doing some things well. We are trying to get folks to 
focus around certain common messages. We have recently put out 
some core nutrition messages because we know that one of the 
ways we can try to get behavioral changes that I was talking 
about is to continually have messages resonate from various 
places. So if we can get folks to try to have the same message 
carried in various ways, then we can try to have more 
effective----
    Ms. DeLauro. Tell me about the messages that were tested 
last December. I run for office every 2 years. So does my 
colleague Mr. Kingston and Mr. Farr. We deal with messages all 
the time, what we say and what we do. If we waited, if we 
waited the amount of time to figure out what messages work or 
don't work, it would be a cold day in you know what before we 
got here.
    What happened in December.
    Mr. O'Connor. Those are the messages that we put out to the 
State agencies. They are now using those messages. They have 
been accepted by the States and they are incorporating those 
into the nutrition education programs that they are running for 
the clientele.
    Ms. DeLauro. We are running on empty. Is it an old Jackson 
Browne? We are running on empty here, and years before we get 
to what we need to do in an age of unbelievable technology and 
ability to follow up.
    The red light is here, but I do want to have Mr. Brownell 
and Ms. Parker comment about that quote from Mr. O'Connor's 
testimony about role of nutrition assistance and causing weight 
gain, USDA is not aware of any convincing evidence that school 
meals or other Federal and nutrition assistance programs cause 
obesity and overweight. The evidence that does exist is mixed. 
I ask for your comment on the earlier commentary as well as on 
this.
    Ms. Parker.
    Ms. Parker. Let's see, let me answer in a couple of ways if 
that is okay. One is in terms of nutrition education we don't 
really have a recent report at the Institute of Medicine on the 
effective nutrition education or what works best, but we do 
have several reports on obesity prevention and childhood 
obesity prevention. And when we looked at that issue what we 
found was that the environment in which children are affects 
whether they become obese or not. There are connections between 
environment and obesity both for children and adults.
    And my point is this, that nutrition education by itself is 
not going to take you all the way. You really need to look at 
and make it possible for people to act on what they have 
learned. You have to make it possible for children to act on 
what they have learned.
    If a child is at a school where competitive foods are being 
served that are high in fat and sodium, you are teaching them 
one thing and in then changing it around. If you tell kids they 
should be physically active and try to encourage them through 
nutrition education, which physical activity is part of 
nutrition, but if there is no physical education in school, if 
kids can't walk to school because it is dangerous, if the whole 
build environment around them, if the fast food restaurant is 
one block away perhaps from their school and there is no 
labeling there, those are all potential situations in which it 
is very difficult for people to act.
    If a mother learns that she should be having low fat meats 
and low fat dairy, but not a store in her neighborhood that 
provides those products because there is no major grocery 
store, she can't act on it.
    So I guess I want to throw in the idea that along with 
nutrition education we have to be thinking about also changing 
the environment in which people are so they can act on what 
they learned.
    And then on the issue of food programs and obesity we 
haven't done that analysis, but speaking from a personal 
perspective I have looked at the literature and other research 
that I have done outside of my work at the Institute of 
Medicine, and I would agree with the USDA analysis and both at 
ERS and FNS that the literature is mixed but overall there does 
not seem to be a connection between--right now in the 
scientific literature it is not clear that there is any 
connection between obesity and the nutrition programs.
    The one thing I would say is that when I was talking about 
competitive foods, people often don't realize school lunch is a 
program that has portion size control, that it has to meet 
certain nutrition standards, but there are other things that 
are being sold and offered to children at the same time. When 
people walk into a cafeteria, they don't realize that a lot of 
the foods that are provided are foods that are outside of the 
lunch program that are sold and there is vending machines and 
student stores and snack bars. So there is a lot of, again, in 
terms of the environment in which kids are, and in the 
environment in which school lunch and breakfast are it is a 
pretty difficult environment to provide kids with a nutritious 
meal.
    Ms. DeLauro. Dr. Brownell.
    Mr. Brownell. Three reactions, number one is the question 
about whether these programs are helping drive obesity I 
believe comes in the context of critics of these programs using 
this as an excuse for wanting to cut them back. I do not 
believe there is sufficient evidence to justify that point of 
view. There is plenty of evidence, anecdotal and just common 
sense, that would suggest that the programs could be doing more 
to help the obesity problem. So going forward, that certainly 
becomes the more important question.
    Second is the issue of nutrition education. There is a long 
history of nutrition education affecting things other than 
behavior, like they affect knowledge and attitudes about food, 
but you don't get too many nutrition education programs that 
actually change behavior. And I really support the spirit of 
what the USDA is doing, but unless they are doing something 
different than everybody else has been doing for years and 
years and years, it will take 2 years to find the inevitable, 
that these things have unsatisfying results. Now I hope that is 
wrong, and God bless them if they can pull it off, but it would 
be different than anything else that has happened in the past. 
That is why I believe that changing the default conditions is 
more important than education.
    So back to the point Lynn made, if there were zoning ways 
to get mini markets and fast food restaurants and the Dunkin 
Donuts out of the range where kids can walk from a school, that 
would probably be more helpful than the education going on in 
school.
    And then, second, the core messages that Mr. O'Connor 
discussed. I am very much in favor of that in principle and I 
think it is a very good idea. Unfortunately, I think the USDA 
for years and years has existed in a political climate where 
there has been great fear of offending the food industry. I 
haven't seen the core messages, but my guess is that they are 
probably not the most assertive in the world. The core messages 
that one is left with in that political environment is focusing 
on encouraging people to eat more of the good things rather 
than less of the bad things. You just can't get to the goal 
line by doing that. You can talk about fruits and vegetables 
all day long, but as long as there is soft drinks, fast food, 
sugared cereals, candies, you have big trouble.
    So to the extent that USDA, with the political climate, can 
change and the USDA is empowered to be more assertive with 
those core messages, I think that would be quite beneficial.
    Ms. DeLauro. Thank you very much. I want to yield to my 
colleague from Georgia. I would love to see if we can get the 
core messages and take a look at it. I think you made an 
interesting point, both of you, in terms of the amount of the 
money we are spending on education and the outcome. $788 
million is not exactly chump change. It is not the $10 billion 
or the money that the industry spends, but it is certain maybe 
we can redirect some of that in more effective ways.
    [The information from USDA follows:]

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     Ms. DeLauro. Mr. Kingston.
    Mr. Kingston. Dr. Brownell, just to jump on that last 
statement because I think that moves in the direction I wanted 
to ask you about, in terms of you said you just can't get there 
when you are offering this stuff, they are maybe going to 
choose something less nutritious. In your testimony you said 
that maybe you could give a bonus for people on SNAP to buy 
certain foods in the right direction. But why not just 
eliminate some of this stuff, based on your statement which I 
tend to agree with, why not just say this stuff you can't do?
    Mr. Brownell. I am totally in favor of what you just said.
    Mr. Kingston. And then, Ms. Parker, why not say to a school 
75 percent of your food has to be Tier I. Right now is there a 
split between Tier I and Tier II, a quota split?
    Ms. Parker. No. What is recommended in the standards is 
that during the school day for all levels of schools that the 
Tier I is what is in place, and then after school for high 
school students Tier II can be allowed. The reason is to 
provide in a school setting the best options for kids. That is 
sort of based on the way the committee approached the task in 
the beginning as what are the best foods we can offer children 
and what are the foods that will be most likely to represent 
what we want children to be eating. And the thinking being from 
the evidence we know, they are not getting enough fruits, 
vegetables, whole grains, low fat dairy, and so forth.
    Mr. Kingston. Well, in terms of the big picture what is the 
split between Tier I and Tier II consumption, in the mega 
picture?
    Ms. Parker. First of all, these standards are not in place 
right now. It is recommendations.
    Ms. DeLauro. It is a recommendation.
    Mr. Kingston. But we don't know what the split is.
    Ms. Parker. If you were to look across the country, nobody 
has done--well, there are some national it analyses, the HHS 
has looked through their school health survey, they have some 
sense of what is out there. And I suspect that what is out 
there is probably the opposite. Kelly, you may have----
    Mr. Brownell. It is highly variable from school district to 
school district and even from State to State.

                  OVERPAYMENTS IN SCHOOL MEAL PROGRAMS

    Mr. Kingston. That may be some data that we need to get.
    Another thing this committee has worked on is trying to 
merge the Department of Education physical ed requirements with 
the USDA nutrition requirements and we put in some report 
language in our bill last year. A lot of that stuff kind of got 
caught in the CR process. I am not sure what survived or what 
did not, but we are aware of that and interested in that. And 
so any recommendations you may have are certainly welcome.
    But I wanted to ask Mr. O'Connor a question. In terms of 
last year there was an audit that said 8, almost 9 percent of 
the funds were improperly applied. $860 million, I think that 
is what it was for the school year 2005 and 2006. What has the 
USDA done to address that?
    Mr. O'Connor. We will be looking at that in the upcoming 
months. We have child nutrition reauthorization coming of 
course, and I have to defer to Secretary Vilsack on that in 
terms of what is going to be put forth and whatever. But it is 
a difficult situation. We know that there are tradeoffs that 
the schools have in terms of the burdens that they put on 
people in order to be applying for the school lunches. There 
are burdens that get put on them in terms of policing them.
    Having said that, those are not excuses for those kinds of 
issues and stuff. We are taking it very seriously. We want to 
take an aggressive stance in terms of trying to deal with the 
issues, but we have to do it in consonance with the realities 
of what happens in the local areas and stuff.
    [The information follows:]

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    Mr. Kingston. There was a Senate hearing about it recently, 
correct? I don't know if you attended that.
    Mr. O'Connor. I did not.
    Mr. Kingston. They actually had that study which was done 
in April of 2008 that showed some of the money, the school's 
reimbursement rate was higher than their cost. And it might be 
two different things, because the 860 million was an improper 
payment. And then the other issue was the reimbursement to 
schools was higher, and you have seen that chart. But the mean 
cost was $2.36 and the reimbursement rate was $2.51.
    And I am out of time, but I would like, maybe we will get 
back to that today, but if not, for the record.
    [The information from USDA follows:]

    Federal reimbursements are one of several important sources of 
funding for school meals programs. These payments cover the cost of 
meals provided free to the lowest-income children, and portions of the 
cost for other meals. Remaining revenues are provided by families in 
the form of cash payments for meals and other foods, and through State 
and local contributions. USDA's most recent data indicate that Federal 
reimbursements represented just over half of all food service revenue 
in school year 2005-2006.
    USDA conducts a periodic study of the costs and revenues to schools 
that participate in school meals programs, to estimate the cost of 
producing meals and the ability of schools to cover these costs. Data 
from USDA's latest study shows that in school year 2005-2006:
     On average, school food service revenue was adequate to 
cover total reported operational costs. School food authorities are 
required to manage on a non-profit basis; most operated at a break-even 
level.
     The Federal subsidy ($2.50, including cash and 
commodities) for a free lunch exceeded the average reported cost 
($2.28). The reported cost of producing a lunch was less than the free 
subsidy in four out of five school districts; in the rest (typically 
smaller ones), the cost exceeded the subsidy.
     Virtually all schools charge families less for a full 
price meal than the Federal government provides for a free meal. Even 
when factoring in the limited reimbursement that USDA provides for 
these ``paid'' meals, schools collect only about 80 percent of the 
revenue that they get for free meals--about 40 cents less per meal.

    Ms. DeLauro. Mr. Farr.

                CONSOLIDATING SCHOOL NUTRITION PROGRAMS

    Mr. Farr. Thank you much, Madam Chair. I want to 
congratulate you on having this hearing. I hope we will have 
more because I think this issue is too important for our 
Nation.
    I represent the salad bowl capital of the world, the 
Salinas Valley, and I have been through a lot of the schools in 
that district. I am just appalled at how little of the 
discussion here in Washington in hearings like this, which I 
believe have become just academic discussions, really have 
anything to do with what is happening on the school grounds. 
And what I have seen is that it has been a dream for Americans 
to make sure that no child goes hungry and that we have good 
nutritional programs. But in the process of getting there we 
probably have created the biggest bureaucracy in the Federal 
Government in the child feeding program.
    Many of my schools tell me that 80 percent of the cost of 
the programs is administration. If we had that in Social 
Security, we would have 4 out of $5 in Social Security just in 
administrative costs alone. It has turned into a nightmare. We 
don't even have programs, school nutritional programs. There is 
not such thing. What we have in the schools are the School 
Lunch Program, the School Breakfast Program, the Child and 
Adult Care Program, the Summer Food Service Program, Special 
Milk Program, After School Breakfast Program, Fresh Fruit and 
Vegetables Snack Program. Every one of those programs is 
administered in a different silo.
    In some cases you can qualify for many of them. But in most 
cases you have to not only qualify to be in the program but 
each program monitors whether each day you come and take that 
meal and if you ate that meal, sort of a point of sale 
requirement. The data and the computers that schools have had 
to buy just to account for that, rather than just feeding poor 
kids, it is just appalling.
    And then what we find is that in some of our schools they 
don't have kitchens, as they used to when we were little kids 
and they made the food right there. They have these centers, or 
areas called pack-out kitchens. And those pack-out kitchens 
receive commodities. Now schools are not preparing them, so it 
is no good getting a big bag of wheat or big bag of corn. What 
these schools do is they go through these processors to process 
that and give them products they consume which essentially are 
packaged. And guess what happens in the process? Sugar and salt 
are added. So many of these schools don't have anything added; 
they may get an apple on the plate but the rest of it is all 
packaged and comes from commodities, excess commodities which 
we in this program alone spend $638 million, buying soybeans, 
wheat corn, rice, the commodities, and distributing them to the 
schools. And most of those pack-out kitchens are in urban 
schools and in our poorer schools.
    So what I am shocked at is that nobody in all these years 
has come to Congress and said, you have built a can of worms 
here, this is nuts.
    And I want to thank you for your 30 years of service, Mr. 
O'Connor, but I am just really surprised to hear we are going 
to go reauthorization, we reauthorized the same old stuff, we 
are destined for just failure. Because if all this money is 
being spent on people rather than on food and we are not 
spending it on the poor people, we are spending it on just 
hiring staff and accounting.
    So my question to you is instead of operating six separate 
feeding programs in schools, can't we just boil that into one 
program called school nutrition program? And then take all your 
other programs, your food stamp program and your other programs 
you administer in that, the special supplemental, the WIC 
program, commodities assistance account, things like that, all 
those that are under food nutrition, and move those into a 
community nutrition program and cut out so much bureaucracy and 
start direct certification of children. We are doing that in 
California. We are told that we can't use the Medicare tapes. 
If we could do that, some of my schools in the direct 
certification, the direct certification is giving them names of 
children who qualify for the program but whose parents have not 
entered into it, many times because they can't speak English or 
they don't know how to fill out the forms.
    Why are we trying to pedal this program as being an 
effective program when we have such a nightmarish 
administration?
    Mr. O'Connor. You put me in an awkward position, Mr. Farr. 
I understand. I think the root answer or the answer to what you 
are talking about really comes down to just making some 
fundamental policy calls that Secretary Vilsack is going to 
have to be taking a look at. I do know that the issue of having 
programs that overlap and are competing, or whatever, is 
throughout this area as well as some other areas and stuff.
    Mr. Farr. Isn't it true that all those programs could be in 
the same school on the same day and each one of them has to be 
accounted for differently?
    Mr. O'Connor. I don't know that they are all in the same 
school.
    Mr. Farr. They could be.
    Mr. O'Connor. Oh, could they be? I think there could be a 
lot more coordination between them, yes, for sure. There would 
have to be changes in legislation.
    Mr. Farr. Who makes those recommendations? Does the 
Department come forward in the reauthorization and say let's 
roll this stuff into one and start using the smart data we 
have? We can check every single person that is getting on an 
airplane in this country and we do, every single person. And we 
know whether that person is qualified to get on that airplane 
based on our background check. And if they don't or are not 
qualified, then we don't see them and they don't get on the 
plane. Now if we can do that for every single traveler in this 
country, we certainly ought to be able to pick out the poor 
children in the country, we have the data on it.
    Mr. O'Connor. The requirements for participation in some of 
the programs that you are talking about are different from one 
another.
    Mr. Farr. Why?
    Mr. O'Connor. Excuse me?
    Mr. Farr. Why? It is about feeding kids. We don't check 
those kids when they get on the bus in the morning as to a 
means test. We don't check those kids when they go into the 
school library and check out a book, but damn it, if you are 
going into a cafeteria you have to be pulled out. I'm sorry, 
you don't qualify, you can't eat this meal. Do you know what 
the teachers do or the administrators do? They take the money 
out of their pocket. It is just nuts. We have gotten into a 
class system in our School Lunch Program. And if you wanted to, 
why haven't we even implemented the USDA's and even update the 
Web site to reflect the changes the Congress made in the 2008 
Farm Bill that will provide $1.2 billion in mandatory money 
over the next year for fruits and vegetables? When is that Web 
site going to be updated?
    Mr. O'Connor. I will have to get back to you on that, Mr. 
Farr. I am sorry.
    [The information follows:]

    The Farm Bill Web site within the USDA Web site provides 
information that summarize the fruit and vegetable provisions of the 
Farm Bill. This information is provided at http://www.usda.gov/wps/
portal/Farmbill2008.

    Mr. Farr. Well, I am really hopeful, Madam Chair, that we 
can begin delving into, because this is the fiscal committee, 
and when you look at it, to have all of these programs called 
child nutrition, most of them in schools, I am sure that the 
WIC Program, the one for Child and Adult Care Food Program 
might be better in a community service, but we have 
requirements that--for example, the breakfast program has very 
poor attendance. Why kids don't get up early, go to a cafeteria 
before they go to a class. We don't even do that here in 
Congress. Most of us go right to our hearings. So if we just 
change the policy that you could have that snack in the 
classroom, you would have a lot more consumers of the food than 
having them go through the cafeteria before they go to their 
classroom.
    I think if we move to this direct certification and 
required all States to implement a program like that, one, we 
would have a much better accountability and we wouldn't have to 
get rid of this paper trail. And in some cases we have to just 
assume that if a kid is hungry and needs food that they ought 
to be able to get it. So I am really concerned about these good 
recommendations.
    The commodity programs alone, of which we slough off all 
this excess to the schools and gets into these, in some cases 
this is all the food the kids get. So if you had your test that 
every child in the school nutrition program get access to leafy 
greens and to fruits and vegetables, the answer is no, only 
some schools do. And so by just piling on more here in 
Washington ain't going to get it done in the street. We have to 
start tackling this problem by assessing the nutritional value 
school site by school site. Until we do that, we are wasting a 
hell of a lot of money on trying to manage this program.
    That is my two cents, and then I have got to go to 
California to get some fresh fruits and vegetables.

       FRUITS AND VEGETABLES IN THE NUTRITION ASSISTANCE PROGRAMS

    Ms. DeLauro. Thank you very much, Mr. Farr. And just so 
that our panelists know, this is obviously an issue that Mr. 
Farr is deeply passionate about. There isn't a hearing in which 
the whole issue of the nutrition programs he doesn't focus on. 
We are going to take a trip to the Department of Defense and to 
see those commodities, and see what we have, and see what is 
going to folks besides the fruits and vegetables which is a 
good piece, but we also want to take a look at what was 
purchased in the final days last year of the final 
administration, and what kind of product was purchased and what 
it means in terms of its nutritional value.
    I would just say that Secretary Vilsack will be here next 
week so that we will have an opportunity to talk with him about 
these issues. Do you want a final comment?
    Mr. Farr. If you could have for Secretary Vilsack next week 
within this program, the Child Nutrition Program, of the amount 
of money specifically that just goes for food purchase?
    Mr. O'Connor. Sure. We can try to do that, yes.
    Mr. Farr. Not administrative costs, just food purchase.
    [The information from USDA follows:]

    Of the roughly $13.4 billion in mandatory funds available for Child 
Nutrition Programs in fiscal year 2007, about $13.2 billion was for 
food purchases and $163 million (1.2 percent) was provided for State 
Administrative Expenses. The administrative funds are used by State 
agencies to manage the program, rather than to support operations by 
schools and other local services providers. Federal support for local 
administrative and other labor costs is provided thorough per meal 
reimbursements. Program operators' primary responsibility is to provide 
nutritious meals in a fully accountable manner given the revenues 
available to them from student fees, USDA reimbursements and other 
sources. Within this mandate, they have considerable flexibility in how 
Federal funds are used. The latest study of meal costs in the school 
meals programs found that administrative labor--including planning, 
budgeting, and management for the foodservice program, and other non-
production activities such as maintenance of foodservice equipment--
accounted for less than 15 percent of total reported costs in 9 out of 
10 school food authorities, with an average of about 8 percent in 
School Year 2005-06.

                           COMPETITIVE FOODS

    Ms. DeLauro. Okay.
    Let me pick up on this competitive foods issue if I might, 
because IOM released a report in 2007 and it talked about the 
competition with the breakfast and the lunch program. And so we 
have a number of schools who don't regulate the nutrition 
quality of the foods that are offered through these avenues.
    Mr. O'Connor, based on those IOM recommendations, and it is 
a recommendation, what changes has the Department made in 
response to them? While we can regulate the nutrition standards 
that are required through a federally reimbursable school 
nutrition programs, and, Jack, I will just say to you that we 
can make a determination of what goes into that basket if you 
will. What are we doing about what should the competitive foods 
that are offered in school; should we make competitive foods 
the rules mandatory in your view or should we leave it to the 
school districts to decide? And I say, Mr. Brownell, your 
testimony says that USDA uses old standards to define 
permissible competitive foods. What I would want to ask you 
then, what do you mean by this? But should we mandate on the 
competitive foods?
    Mr. O'Connor. I hate to sound like a broken record.
    Ms. DeLauro. You are going to tell me that the Secretary 
has to answer that question.
    Mr. O'Connor. I feel like I have to have a prepared 
statement and read it each time. Those really are policy 
questions that I think answers will be revealed when you are 
able to speak with the Secretary about that.
    Ms. DeLauro. And I will just say in regard to the 
Department, and this is about 3 decades ago because I think 
this is important to note, the Department tried to ban chips, 
cookies, and soft drinks from schools, but they were thwarted 
by the courts and by food companies. So that speaks volumes to 
me about what kind of direction that we need to try to go in.
    I spoke to, I told you, to the Department of Education to 
the Secretary today, he banned those products in the Chicago 
schools. He said he took a lot of heat for it, and he also felt 
that he was looking at revenue that was coming into the schools 
and shutting it off. But the tradeoff he felt was worth it to 
do that, but he was concerned about the revenue that he was 
leaving behind. Now that is an issue for how much we are 
funding our schools and what we are doing, which is not the 
subject today.
    Dr. Brownell, again there are actually two things. You said 
USDA uses old standards to define permissible competitive 
foods. You also say about the Child and Adult Care Food Program 
that existing standards within the CACFP permits the use of 
meals of poor nutrient quality. And if you could just respond, 
just comment.
    Mr. Brownell. Well, for example, according to the current 
USDA recommendations, there are things not allowed in schools 
that are irrelevant, like cotton candy and breath mints, but 
things that are allowed in schools like candy, french fries, 
chips, snack cakes, and the like. So that obviously is an 
aberration and should be changed around. The IOM has good 
standards; it makes sense to adopt those.
    So I think there are good standards around, you can use 
common sense to make half of these calls and probably get by 
just fine. But one thing I would like to make a point of is 
that if we consider schools a place that are a safe environment 
for our children, that we then we have to consider nutrition 
safety, not with tainted food as much as just poor nutritional 
quality food. So we would find that the role of government to 
step in and be aggressive if the air in the schools is making 
kids sick or if they were exposed to lead paint and that was 
making--well, the foods are making them sick. And so in the 
call of the safety of schools, when parents let their children 
go to schools, they turn them over with the assumption that 
they are going to be treated in a safe and hospitable way. With 
the food system that we have now, that is not the case 
necessarily. It is all the more reason for change.
    Ms. DeLauro. Mr. O'Connor, those recommendations Ms. Parker 
came out in 2007.
    Ms. Parker. The IOM report came out in April 2007.
    Ms. DeLauro. Was there anything done with those 
recommendations vis-a-vis the--I mean it is 2009 and I 
understand we have a new Secretary, but they have been around 
since April of 2007. Was there anything done with that 
material? Any conversations about how to take those 
recommendations and put them to some practice?
    Mr. O'Connor. The view that we had of the recommendations 
is that they are sound recommendations and from a good source. 
They need to be taken into consideration as we move into child 
nutrition reauthorization, and that is where we were at that 
point.
    I think that one of the things that you point out when you 
were talking with the Secretary of Education is that when he 
was in Chicago he was able to take action in Chicago in order 
to make some of the changes that you are talking about here. 
And I think that very much this can be looked at as a local 
issue. You know, not totally but localities do have the 
opportunity to be able to put things in place at this point in 
time. That doesn't mean that there isn't going to be a look 
taken at the recommendation from the IOM as we move forward 
into the reauthorization process.
    Ms. DeLauro. I would just say in response to that that just 
shifting it over to be a local issue--I think Dr. Brownell made 
a point. If we were to discover that the air filtration 
systems--or lead paint, let's talk about lead paint. Let's talk 
about a whole variety of areas in which we have come to 
conclude that we put the public health in serious jeopardy. We 
are talking about regulating tobacco. We have 400,000 people 
every year who die from some tobacco-related illness. After all 
these years we decided we had to do something about that.
    I always go back to my example here. We had 3,000 people 
who died on September 11th. They just got up and went to work. 
It was through no fault of their own. We have people being sick 
and ultimately who are put in great risk in the hundreds and 
hundreds of thousands every year, but we don't feel we need to 
go to war on those issues. We need to go to war on those 
issues. My own view is that the Federal Government does have a 
role and a responsibility in this effort. If we just leave it--
and quite frankly, a lot of the industry has had great sway in 
these areas about what is going on in terms of the nutritional 
quality of our foods and what we are serving and what our 
commodities are, et cetera. It is about what is in bulk. And 
what is in bulk may not be what is of the best nutritional 
value for youngsters, and seniors for that matter at the other 
end of the scale. That is good for their health. And what is 
happening? They are getting sick and we are faced with 
illnesses that are costing millions and millions of dollars and 
putting people's lives at risk.
    So you know, I think there is a role for the Federal 
Government. And my hope is that--I am not going to lay this at 
your doorstep, we have a new Secretary. Quite frankly, we 
couldn't get to first base in the last go round for the last 8 
years. I am hopeful and optimistic that there is a new 
environment and we can get more than to first base but that he 
can we can hit a home run where it comes to the nutritional 
quality of our food in our programs that we have jurisdiction 
over. I am not talking about what they sell in other places. We 
have jurisdiction over these programs, and we have a 
responsibility that goes along with that.
    Mr. Kingston.

                             ORGANIC FOODS

    Mr. Kingston. Thank you, Madam Chair.
    Dr. Brownell, I wanted to ask you the cold hard science of 
organic food, which isn't always what is in the marketplace, 
but in your group are you guys studying the true advantage of 
organic or disadvantage? It is sexier to have organic fruits 
and vegetables compared to canned or frozen, but is the science 
sound?
    Mr. Brownell. It depends on the aim of using the organic 
foods. If the aim is to decrease the environmental footprint of 
raising the food, then organic foods tend to be better choices 
than the other ones, because there aren't the fertilizers, the 
pesticides and things like that that you develop with fossil 
fuels and things. In terms of the nutrition, which I think is 
probably what you are asking about, it is not studied well 
enough to really know how much better, if any better, the 
organic foods are.
    There is some research I have seen recently by a researcher 
named Davis in Texas about declining nutrients in foods. And he 
has published what I find pretty persuasive evidence that--like 
a carrot is no longer a carrot. A carrot has less nutrients in 
it than it used to have. You would have to eat even more of it 
now than you would have before to get the same nutrients. Now 
there could be contrary evidence, this is in horticulture 
journals and things that I don't follow very well, but that is 
my understanding that that occurred.
    Now, it is possible that the organic foods help compensate 
for some of that and have a higher nutrient profile, but I 
don't know if there is enough science on that.

                 OBESITY AND SCHOOL NUTRITION PROGRAMS

    Mr. Kingston. Ms. Parker, I wanted to ask you in terms of 
the obesity rate if we look at--and I am trying to get the 
numbers together, but the creation of Federal programs on 
nutrition and obesity compared to the increase in obesity, they 
haven't done a good job of reducing obesity if that is their 
purpose. But a lot of it does have to do with after school 
snacks and uncontrolled variables. Do we have any studies at 
all that can show that nutrition consumed at school isn't the 
problem, whether it be in the Tier II versus Tier I world, 
which I understand is still just a discussion matter, but is 
the real problem after school on their own, weekends? Do you 
know?
    Ms. Parker. I don't think the literature is there to really 
make those kinds of distinctions, but certainly what children 
eat is not just what they eat at school for school lunch and 
breakfast, it is also everything else they eat at school and 
then everything else they eat everywhere else they eat.
    Mr. Kingston. It would be nearly impossible to figure out?
    Ms. Parker. Well, there might be a way of making some 
estimations, but I don't think the literature is there or 
studies have been designed yet that I know about to be able to 
do that.
    But would it be okay for me to comment for a minute on 
something else you raised earlier?
    Mr. Kingston. No.

                             SNAP PURCHASES

    Ms. Parker. This I am speaking from a personal perspective 
now, not from an Institute of Medicine because we don't have a 
study on this one, but I just wanted to raise a caution about 
prohibiting totally certain foods in the food stamp shopper's 
diet and what they are able to purchase with food stamps.
    I am basing this more on earlier work I have done through 
any career working with low income families, and these are 
cautions. We really need to look at, first of all, what is 
available to low income families in their communities because 
many communities--I think until recently Detroit didn't even 
have a supermarket if you can imagine that. It is kind of 
stunning to think that that is the case. But that leads not 
only to the issue of availability, but it also leads to the 
issue of cost and how much things cost.
    Also I think looking at families, I have seen how people 
plan. If they have very low incomes, which often food stamp 
recipients do because that is part of their eligibility, they 
have to plan very carefully. People send their kids to their 
sister's house once a week to eat, they have gardens and they 
go to food pantries and food banks. So they have lots of 
sources of food that they sort of have to patch together to 
have enough. And so thinking about that in terms of what one 
does related to the food stamp program, it is important to sort 
of understand the realities of that and how any proposal you 
make could affect that.
    And then finally I am thinking about especially now with 
people losing their jobs and probably more people going on food 
stamps, all of this becomes more important and the 
embarrassment that people feel when they go up to the counter 
to buy their food and some food they can buy and some they 
can't. This would be a very complicated matter. Now that we 
have the cash register set up it makes it easier in some cases, 
but for families figuring out what you are allowed and not 
allowed, talk about embarrassment. I can just see people who 
recently lost their jobs through no fault of their own are put 
in a very embarrassing situation.
    We just got these EBT cards now to make everything work 
better, to reduce problems with the program, and this may add 
in more problems. So I am just saying in thinking through these 
issues we have to think about the situations and the families 
and try to figure out what works best for the whole situation.
    Mr. Kingston. Thank you.
    Ms. DeLauro. If I might just on that note, Jack, because I 
know you would by interested in this, when we were working on 
the Farm Bill and looking at increasing the maximum benefit on 
food stamps, and after 30 years we went from $10 to $14 and 
then I mean $134 to $144. What I found in looking through 
studies and also in clips and so forth that what happens in 
terms of that planning process is at the beginning of the month 
families are buying milk and eggs and juice and more nutritious 
foods. When you get to the end of the month you are trying to 
figure out how to feed the family. What fills the bellies of 
kids? Soda, you are looking at junk food. It really is, you can 
see the patterns and trends because this is what it is. And 
fruits and vegetables some of the highest cost foods so that 
they cannot afford that. They are not wanting to buy that, but 
look hey, you are going to the supermarket your kid says, I 
want a bag of potato chips, you may do that, but for a regular 
diet they have some real constraints around that dollar amount, 
again once at the beginning and at the end, which makes it 
very, very difficult, including what you are saying.
    We have got people now going to food banks who have lost 
their jobs through no fault of their own--I won't forget this 
quote. This gentleman had a job in manufacturing, he lost his 
job. He said, I felt like a low life, I felt humiliated to go 
to the food pantry to be able to get food, but I had to do it 
because I have to feed my kids because of the stigma that is 
attached with what we do.
    Mr. Kingston. I want to make a motion that you can continue 
without me.
    Ms. DeLauro. Thank you very much, very much, Jack. We need 
usually two members here because I have several more questions.
    The other thing you should know about Mr. Kingston, who 
talked about the whole issue of physical exercise and making 
sure that physical education is a part of our school 
curriculum, it is very, very important and he has fought for 
those programs, because it is not just the food side of it but 
the physical and activity side as well. So he is a big champion 
of those efforts.
    Mr. Kingston. Rode my bike today to work 10 miles. It was 
freezing for a Georgia boy.

                        IOM NUTRITION STANDARDS

    Ms. DeLauro. Mr. O'Connor, the Institute of Medicine is 
currently developing recommendations for revising the nutrition 
standards and the meal requirements for School Lunch and 
Breakfast Programs, and that is based on the 2005 Dietary 
Guidelines. As I understand, the report is due this year, in 
December?
    Mr. O'Connor. I believe it is October.
    Ms. DeLauro. October, okay. Very good.
    Mr. O'Connor. I hope I am right.
    Ms. DeLauro. It took almost 2 years from the time that the 
WIC IOM study was published to get an interim rule out of the 
Department and another 2 years before the States were mandated 
to implement the changes. How long will it be before we get the 
revisions to nutrition standards and meal requirements 
implemented in the schools?
    Mr. O'Connor. Our best guess is it may take as long as 3 
years. I would hope that we would be able to get the regulation 
out based on those standards faster than we were able to do 
that with WIC. But there is going to have to be some lead time 
for the schools to be able to implement the changes.
    Having said that, that doesn't mean that some schools may 
not be able to implement sooner. Some schools may be meeting 
those requirements by the time we get a rule out or whatever. 
But the rule itself, best guess might be about 3 years to total 
implementation.
    Ms. DeLauro. Why?
    Mr. O'Connor. It is a long process. There is going to be a 
need for public comment. You can imagine that the changes that 
this may be putting in place for localities, there will be a 
lot of folks who want to have something to say about that. We 
are going to want to listen to the comments. And then there is 
time that the school is going to need in order to be able to 
change what it is that they finally put in place.
    Ms. DeLauro. Currently guidance to schools and child and 
adult care centers are that they must meet the minimum Federal 
nutrition standards. What are those currently and how many 
schools are meeting those minimum standards now?
    Mr. O'Connor. I don't know that offhand. We can get that 
for you.
    [The information follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
                    CHILD NUTRITION REAUTHORIZATION

    Ms. DeLauro. Let me ask the panel a question here. We do 
have the child nutrition reauthorization coming out. I think 
that this is really incredible that we have the child nutrition 
reauthorization coming out before the IOM is scheduled to 
release the study.
    How will we know what the reimbursement rate should be to 
provide a revised nutrition standard and meal requirement 
recommendations? Does anyone know what a nutritious meal will 
cost? How does that translate into budgetary resources needed 
to enact these changes? The School Nutrition Association says 
the schools need a $0.30 increase just to break even. If the 
new meal requirements would require doubling the reimbursement 
rates needed to provide from, let's say, $2.57 for a free lunch 
to around $5, what is the amount to implement that change? Is 
the Administration asking for adequate resources to be able to 
make these changes?
    Mr. O'Connor. The same answer as before. I am sorry about 
that.
    Ms. DeLauro. I don't understand how we can move to restore 
this bill without having the data and the basis on which to 
have good information in order to make the right, in order to 
make the right decisions. Sometimes the public wonders what we 
do here. I am wondering what we are doing here in this regard. 
Let me ask. I don't know if you had any other comments.
    Mr. O'Connor. Not right now.
    Ms. DeLauro. Mr. Brownell, Ms. Parker.
    Mr. Brownell. I don't have any particular insight on that 
issue.
    Ms. Parker. No, I don't.
    Ms. DeLauro. Is there a need to increase the reimbursement 
rate? Do you have a view on that?
    Mr. O'Connor. We have done a study on the reimbursement 
rate, and it doesn't--it is not conclusive that the schools 
have an inadequate reimbursement rate right now.
    Ms. DeLauro. It is not conclusive that they have an 
inadequate, did you say, or an adequate? Say that again.
    Mr. O'Connor. Let me see how many negatives I can put into 
a sentence. I confuse even myself. The study shows that the 
current reimbursement rates look as though they exceed the cost 
of providing meals. It is a very complex situation, though, 
when you are looking at all of the different kinds of meals 
that are provided to different folks, whether they are getting 
free, reduced, or full priced meals or what not in the schools. 
But I know that there are many in the schools community that 
think that the reimbursement rate does need to be raised. That 
is something that, again, we are taking a look at, and we are 
cognizant of.

                       FOOD MARKETING TO CHILDREN

    Ms. DeLauro. Let me ask a--I thought about this, just asked 
this or offered it in my opening remarks, which is, given the 
amount of money that the industry spends on advertising to 
children, can we succeed in behavioral change given that 
marketing and their advertising? I mean, are we on a fool's 
errand?
    Dr. Brownell. Ms. Parker.
    Mr. Brownell. We are very committed to the topic of food 
marketing, especially directed at children. And the amount is 
staggering. And not only is the amount staggering, but the 
types of marketing that gets done are quite different than what 
used to be the case. Parents used to be in a better position to 
monitor what children are being exposed to. But now children 
will get advertisements on their cell phones. The industry can 
spend money much more effectively these days. Instead of a 
blunt instrument, like a television, now that costs a lot, a 
cost that goes to people that may or may not be interested. You 
have Internet games that children go visit on the Web, where a 
child, instead of seeing a 15 second commercial on television, 
could be there for 30 minutes pushing cookies around the screen 
or sugared cereals around the screen. And so the marketing is 
becoming much more difficult to even measure, much less do 
something about. But we believe that something has to be done 
to curtail that or else it is hard to believe that almost 
anything else could have an impact because the industry can 
undo it so quickly.
    Ms. DeLauro. What are your proposals in that area? Have you 
done work on that?
    I don't know, Dr. Brownell, if you get the advantage of 
that information.
    Mr. Brownell. We have been funded by the Robert Wood 
Johnson Foundation to do studies on food marketing to document 
how much of it there is. And then our center at Yale was very 
committed to having three things occur with that information. 
One is to help change public opinion so people realize what the 
full landscape of marketing is. And we believe they have to get 
mad about it in order to justify action that gets taken.
    The second arena is legislative action that can be taken to 
curtail this. And there is a historic thing with the FTC that 
comes into play here. Restoring their powers to monitor this 
would probably be a good move.
    And then the third thing is the law. The First Amendment, 
of course, protects the ability to use commercial speech. But 
there are some potential ways around that if you can prove that 
the marketing is unfair and deceptive. And then that gets into 
consumer protection law that gets administered by state. So we 
do believe there are some opportunities to make changes here, 
but we really need to know the landscape first, we will know 
that soon, and then I think we can get some action on it.
    Ms. DeLauro. I would love to be in touch with you about 
that. I think other members of the committee would as well in 
terms of how we can work at this issue. As I say, we had some 
opportunities with tobacco. A number of us did a lot of work on 
the underaged drinking and what we do there. But let's continue 
that conversation.
    Ms. Parker.
    Ms. Parker. Well, the Institute of Medicine, 3 years ago, I 
think it was, did a report on food marketing to children and 
made recommendations. And I would be glad to get that to you.
    Ms. DeLauro. Please.
    Ms. Parker. Because I think you would find it very 
interesting. And the one thing I would--and very much that 
report makes recommendations about changes in food marketing to 
children also. But I don't think we should find ourselves in 
total despair. There are many children who are eating well, and 
there are many programs that are making changes in the way 
children consume food. But certainly this is a major 
impediment.
    Ms. DeLauro. You are right. Look, in the fruit and 
vegetable program, the Defense Department has that, but an 
agency is doing that. We increased the funding in the Farm Bill 
for that effort. I go to schools all of the time, and you see 
youngsters, and you ask them, what is your favorite fruit? And 
they say kiwi. I say, well, hell, I didn't know what a kiwi 
was, you know. Or what is your favorite vegetable? It is an 
artichoke. Those I knew from my own background, my own cultural 
background with artichokes. But.
    I was talking to a colleague today, Marion Berry, who is 
from Arkansas, and he was talking about the same program, 
because we were talking about this hearing. And he said to me, 
the problem is, Rosa, he said, when they talk to you about kiwi 
and pineapple, then they can't get it, in other words, because 
the store does it or it is priced out of the market for them. 
But they get it in school, but they can't do that. You are 
right, it is not a question of despairing; it is a question of 
figuring out where we are and where we need to try to go in 
that. But I think we have to think about what kind of controls 
and enforcement that we need to do.
    My understanding is I do have a couple of colleagues coming 
back, but I will continue to proceed.

                           WELLNESS POLICIES

    Mr. O'Connor, I guess it may be in the purview of the 
Department of Education for the development of local wellness 
policies. That is not in your jurisdiction. The local wellness 
policies in school is in your jurisdiction.
    Mr. O'Connor. Right.
    Ms. DeLauro. So I have a question there, which is, 2004, in 
that Reauthorization Act, required schools to develop a local 
wellness policy. That is for healthy school nutrition, 
environments, reducing child obesity, preventing diet-related 
chronic diseases. Some school districts have created strong 
community wellness committees that are engaged in promoting 
nutrition education, physical activity and nutrition 
guidelines. Unfortunately, we have got many that have not 
implemented these are the strong programs. What are you doing? 
What can we do here to strengthen this? Again, is this 
someplace where you think we have to mandate the effort here in 
terms of a wellness program?
    Mr. O'Connor. Well, we do have a mandate for wellness 
programs to be in the schools. But what we don't have are----
    Ms. DeLauro. So there is a mandate to the school to have to 
do it.
    Mr. O'Connor. Yes.
    Ms. DeLauro. Okay. How many schools have them?
    Mr. O'Connor. As far as we know, they should all have them.
    Ms. DeLauro. No, no, no, no, ``should'' is not ``do.'' How 
many have them?
    Mr. O'Connor. I don't know the answer to that. What we have 
is the requirement that they have wellness policies. What we 
don't have the authority to do is to require what is in those 
wellness policies, in the wellness programs. So that is why you 
end up with somewhat of a mixed bag when you are going to go 
out to the schools. You see some that are strong, some that are 
less strong.
    Ms. DeLauro. But I would think, in 2004, in a piece of 
legislation, we mandated that schools have to have a wellness 
program. Now, that is like we do with FDA. You have got to come 
up with a plan to--or USDA to look at what your safety system 
is, your HACCP plan, what is that. And then we have to figure 
out a way of monitoring that plan. So what is the mechanism in 
place. The basic question, Mr. O'Connor, is that is a 
tabulation, you know. Show us your wellness plan, and then we 
can calculate how many we have or we don't have in terms of the 
mandate. That is not what is in it, that is a separate issue. 
But is there somewhere--there has got to be somewhere in the 
agency that somebody can provide us with an answer of how many 
schools have a wellness program in place.
    Mr. O'Connor. I can try to find out.
    Ms. DeLauro. It sounds to me like we don't have a number.
    Mr. O'Connor. I don't know the answer to that, I am sorry.
    [The information follows:]

    The local school wellness policy requirement was established by the 
Child Nutrition and WIC Reauthorization Act of 2004 (Public Law 108-
265). The law specified that the Secretary of Agriculture provide 
information and technical assistance to local educational agencies, 
school food authorities, and State educational agencies upon request 
and for guidance purposes only. Wellness policies are developed at the 
district level and implementation occurs at the school level. The 
Department does not have the authority to issue regulations or provide 
oversight for locally developed wellness policies.
    While USDA does not collect data on implementation of the local 
wellness policy requirement, other national non-governmental 
organizations are gathering information on local wellness policies. The 
Robert Wood Johnson Foundation has supported research on this topic, 
including the Bridging the Gap Project. According to preliminary data 
(unweighted and cross-sectional) from this nationally representative 
sample of 579 local education agencies, in School Year 2007-2008, 90.5 
percent of local education agencies that participated in the National 
School Lunch Program said that they had a wellness policy and 9.5 
percent said they did not have a wellness policy.

    Ms. DeLauro. Okay. Then we have to deal with the substance 
of it which is what is important.
    Mr. O'Connor. Exactly.
    Ms. DeLauro. Which is what is important. What are the 
methodologies that you have to look at those, to analyze them, 
to get some sense if it is very good, very bad, nada, zero, 
what is your capacity.
    Mr. O'Connor. The capacity that we have is small at this 
point in terms of the resources that we have. But what we don't 
have, again, is the authority to regulate anyway in terms of 
what the content of those wellness programs should be. That is 
not an excuse to not know what they are and whatever.
    Ms. DeLauro. And I know this is going to be at the purview 
of the Secretary, but I am going to ask the Secretary, and I am 
sure you are all going to go back and talk to the Secretary, 
which is fine, you should; I have a lot of confidence in the 
Secretary. But should we force school districts to take it 
seriously and to do something about mandating and dealing with 
the content of the program?
    Dr. Brownell.
    Mr. Brownell. My understanding of the 2004 requirement is 
that schools have a policy, not a program. And some of those--
so that means a document basically that says, here is where the 
school wellness policy is. That doesn't necessarily translate 
into doing anything about it.
    And so there were sample policies going around. Some school 
districts just cut and pasted the template, and that became 
their policy, and then it went into a drawer. Other schools 
took it much more seriously. So as I mentioned when I was 
making my comments funded by the Robert Wood Johnson 
Foundation, our colleagues at the Rudd Center have done a 
detailed analysis of school wellness policies in Connecticut, 
and we will be happy to share that information with you.
    Ms. DeLauro. Please.
    Mr. Brownell. And what we found is the schools for the most 
part have complied with a need to have a policy. But whether 
that turns into anything tangible by the way of programs varies 
tremendously from place to place.
    Ms. DeLauro. How should we address that? Let me ask you 
what you think.
    Mr. Brownell. Require programs in addition to policies. My 
understanding of the way the legislation got crafted is that 
the people who proposed the legislation weren't able to get 
programs mandated so the political compromise was to get a 
policy mandated. And that is not a bad first step. In fact, we 
find that some schools actually, because of the process of 
establishing a policy, do implement programs. So that was a 
worthwhile enterprise. But to get it done more uniformly would 
require some kind of mandate.
    Ms. DeLauro. Ms. Parker.
    Ms. Parker. I was just going to suggest that there are some 
national organizations that have looked at this issue that you 
may want to look. The School Nutrition Association did a 
national survey on wellness policies, as did the American 
Dietetic Association. So there are some resources out there to 
sort of get a sense of what is happening, which might inform 
whatever the committee decides to do about it.
    Mr. Brownell. The other thing that we have developed that 
may be helpful is my colleagues have developed a tool for 
assessing the strength of school wellness policies, a 
measurement tool that has now been validated. So should the 
USDA decide that they would like to do some uniform assessment 
across the country, that tool might be a helpful resource.

                          ENVIRONMENTAL ISSUES

    Ms. DeLauro. Okay. Let me, on the issue of the environment 
I guess there was something that I read, I guess, in the, it 
must be the food stamp, nutrition and the education. It said 
that the scope, that the environmental issues are beyond the 
scope of the food stamp program in essence. I think that is 
what I discerned from the, if you can find it, Leslie, you know 
where it is, the guiding principles there. I think it is page 4 
of the guiding principles that I read this on.
    But my point is here, because, Dr. Brownell, you have 
talked about environmental issues.
    Ms. Parker, you have talked about that. How do we connect 
these issues in your view with looking at--it is a difficult 
issue. This is a complex issue. How do we do that within like a 
Farm Bill that we deal with, within the USDA? You have to help 
us because we don't have--how do we manage that in terms of 
what we are trying to do and to accomplish when there are lots 
of bigger issues around some of these environmental questions? 
Do you have any thoughts about it?
    Mr. O'Connor. So by environmental questions, do you mean 
the impact of food production on the environment?
    Ms. DeLauro. I am talking about--what I thought it was is 
the environmental issues that are outside the scope of the 
program. How do we look at those things to make it manageable 
in terms of what we do so that we can be attentive to those 
environmental issues as we are looking at public policy in 
terms of food nutrition?
    Mr. Brownell. Well, one thing that would potentially be 
helpful would be to do an examination of the impact of USDA 
policies, agriculture policies, on the environment. Now, 
depending on who you talk to, the food production, that is the 
raising of beef, let's say, is either the first or second 
greatest contributor to global warming. And most people don't 
realize this, but the production, the modern food production 
with heavy use of fossil-based fuels for pesticides, hormones 
and the like; the raising of beef, which is a highly 
inefficient process for a variety of reasons, is having a very 
bad impact on the environment. And again, there are different 
estimates of how bad, but I think most environmental experts 
would agree it is very bad.
    And so some people say that the number one thing you could 
do to improve the environment personally is to have different 
driving habits; drive a different car, et cetera, drive less. 
But the second thing you could do is eat less beef. So when it 
comes to these sort of things, one sees a very tight link 
between decisions people are making about their food, and that 
is driven a lot by agriculture policies and nutrition policies 
in the country, the cost of food, food industry behavior and 
all these sort of things, it has a big impact on people's 
health in two ways: One is the nutrition that they are getting 
from it, but the other is the impact on the environment that 
affects their health in a different way.
    And there aren't many people who are connecting these 
pieces of the puzzle, and I think it is highly important to do 
so. And that is why one of the comments that I suggested was 
creating a commission that would look simultaneously at hunger, 
obesity, and the impact of food on the environment to find win-
win-win possibilities.
    Ms. DeLauro. You talked, Ms. Parker, a lot about some of 
the social marketing and other kind of behavioral things in 
terms of that environment. How would we manage some of those 
efforts?
    Ms. Parker. Well, I was just imagining the situation that 
you are describing is that you, perhaps you have a group of 
women together and you are working with them on nutrition 
education issues and food purchasing and cooking, and then they 
go out to their neighborhood to do what you have suggested that 
they do. And they go to their grocery store. Maybe there is no 
grocery store to go to. Maybe it is just a small corner store 
that has very little food in it. Maybe they go to the grocery 
store, and there is 30 percent fat beef, but not--or maybe 
there is not skim milk or maybe not sufficient. Maybe the 
corner store doesn't carry skim milk. So there has to be some 
change that occurs in the neighborhood so that those mothers 
can actually do what you have suggested that they do. Or in the 
school setting that you tell the kids to eat certain kinds of 
foods, but they are not available to eat. Or you tell them they 
should be physically active, but the physical education program 
isn't there.
    So what it really gets down to is, who has a responsibility 
to change that environment so that people can act on the things 
they learn about what is good for us in terms of nutrition and 
physical activity? And the reality is that lots of people a 
have responsibility. Local government has certain 
responsibilities and powers. State government can make changes. 
Federal Government can make changes. Resources have to be made 
available. In some cases, policies need to be changed. And in 
fact, in our two reports about obesity, ``Healthy Balance'' and 
``The Progress in Preventing Obesity,'' which we would be glad 
to share with you, and we have report briefs from those, we 
really go into detail about what each of those levels of 
government and what each of those stakeholders, what roles they 
can play in changing that environment. Because, for example, in 
Pennsylvania, the State government has made available resources 
to help bring grocery stores into communities. In other States, 
physical education has been made mandatory so that it is 
available to children in schools. So we need to really be 
thinking.
    And that is what you were thinking about at your level of 
course, but at every level, what needs to happen to change the 
environmental conditions in which people are living that make 
it sometimes impossible to act on the very things we are 
telling them to do. And so there are just a number of ways in 
which we can proceed in this area. But I think recognizing that 
it is not just nutrition education; it is not just personal 
responsibility; but you can't carry out your personal 
responsibility if the environment hasn't changed. And 
individuals can help that to change, but they also need 
assistance from local health departments, local government, 
State and Federal Government. And industry, too, has a role to 
play in changing the products that they produce. So all of 
those pieces can make a difference.

                        HEALTHY INCENTIVES PILOT

    Ms. DeLauro. Let me just--I have a couple more. I think my 
colleague, Ms. Kaptur, is coming back, but you have been 
wonderfully patient. And I know one of the issues that Ms. 
Kaptur cares about is the purchase of local foods, whether it 
is through USDA, DOD, schools, care providers, going beyond 
this geographic preference thing. So I will mention this. The 
Administration has proposed previously a pilot obesity 
initiative that calls for competitive grants to develop and 
test ways of addressing obesity in low-income populations with 
evaluation of the results. Can you tell us a little bit about 
this initiative?
    Mr. O'Connor. We have a--I believe what you are referring 
to, we call it HIP. It is taking a look at what incentives can 
we put in place at the point of sale in order to incentivize 
people or encourage them to be able to purchase more fruits and 
vegetables. The number of----
    Ms. DeLauro. Where are you implementing that program?
    Mr. O'Connor. We haven't implemented it yet. We have been 
going through a process of trying to decide what are the 
interventions that we want to be able to test. And it is quite 
complicated to figure out what is the right incentive and how 
would you give people those incentives, how large should they 
be, those kinds of efforts. We are looking to be able to get 
that off the ground this coming fall. So we are moving quite--
there are a lot of factors.
    Ms. DeLauro. Off the ground in deciding what those 
incentives should be and where you are going to go with it, is 
that right, where it is going to be implemented?
    Mr. O'Connor. We will be seeking applications this fall to 
actually put those into place.
    Ms. DeLauro. I see. With the criteria in place.
    Mr. O'Connor. Right.
    [The information follows:]

    In October 2008, FNS held a public symposium on the Healthy 
Incentives Pilot (HIP), convening stakeholders, researchers and 
technical experts from various fields related to the HIP initiative. 
Participants represented the food retail industry, electronic benefit 
transfer companies, nutrition educators, commercial organizations with 
experience delivering product incentives in retail settings, and 
researchers with experience evaluating healthy eating promotions. While 
the symposium provided the substantial information, there was no 
consensus on several key questions FNS posed to participants. Areas 
requiring further examination include the form, size and delivery of 
the incentive; as well as significant features of the evaluation. In a 
response to the wide range of views expressed, FNS followed up with 
additional contacts to key stakeholders, including other USDA and 
Department of Health and Human Services agencies, the National Cancer 
Institute, and multiple professional associations. The goal of these 
follow-up activities is to identify the trade-offs associated with 
alternative choices and cost estimates for different options. A Web 
site is being created and will be implemented in mid-April 2009 for 
interested parties to check the status of HIP activities.
    FNS is on track to meet the following timeline for the HIP:
    Fiscal Year 2009--Complete a very thorough planning process to 
ensure that all research and expert input has been fully vetted and 
considered for the pilot design and evaluation scope. During this time, 
FNS will also develop independent solicitations for the evaluation and 
pilot projects and advertise for proposals.
    Fiscal Year 2010--Make competitive awards for the pilot sites and 
evaluation contractor and initiate activities to implement the pilots 
and the evaluation process.
    Fiscal Year 2011 and beyond--Begin pilot operations and continue 
evaluation activities.

                         SNAP PAYMENT FREQUENCY

    Ms. DeLauro. There was a suggestion or recommendation for 
looking at the, again, the nutritional foods that, and we had 
this conversation a little bit ago about the food stamp moneys 
given out on a monthly basis, if you will. But foods purchased 
through the food stamp program, including providing biweekly 
benefits rather than monthly so families are not running out of 
the benefits by the end of the month, what are the impediments 
or the benefits of implementing biweekly benefits, point-of-
sale incentives or these other kinds of improvements that we 
can look at by way of improving the nutritional quality in the 
program.
    Let me start with you Mr. O'Connor. Then I will yield to 
Ms. Kaptur.
    Mr. O'Connor. One impediment is that the Farm Bill 
prohibited it.
    Ms. DeLauro. Prohibited the bimonthly.
    Mr. O'Connor. Right. And one of the things that you get 
into is there is an added cost to be able to do that. And so 
that has to be taken into consideration as well. And also I 
think, from the experience that I have had with the SNAP 
program, with the food stamp program, the benefits are really a 
supplement to help people be able to purchase a nutritional 
food that they need for the entire month. If we split that 
benefit up, we are splitting the supplement up. There is an 
expectation, except for those people who are getting 100 
percent of the benefit or whatever, there is an expectation 
that they are contributing towards the purchase of food 
themselves, so it could just be deferring how that budgeting 
happens in the household. So there are a number of factors that 
come into play on that.
    Ms. DeLauro. Comments?
    Mr. Brownell. Yes, quickly. A lot of the questions that you 
raise are easily testable and could be tested in a very short 
period of time if the money were available and there were some 
mandate for this. So if the USDA had a granting process, and 
perhaps they do that I am not aware of, specifically around 
this concept of how can we improve nutrition through these 
programs by systematically manipulating these various pieces of 
them, then you could have an answer pretty quickly about what 
would most help and what the costs would be. That can be done 
quite readily I would think. The question is, what would the 
update be? How quickly could it be implemented in policy? And I 
know less about that. But the studies wouldn't be very hard to 
do.
    Ms. DeLauro. Well, we should talk about that.
    Ms. Parker.
    Ms. Parker. Again, this is not as an OIM witness, but 
rather from my personal experience. It goes back again to the 
situation in the household. If you have got a limited amount of 
money and you are purchasing, you plan for the month and you 
buy things in bulk that you can buy that aren't as perishable. 
And so if your money, whatever money you get from food stamps, 
is split in half, that may reduce your ability to take 
advantage of big sales, bulk purchases. And anybody who has had 
experience buying with small amounts, or living on small 
amounts of money and trying to plan will know what I am talking 
about. You can't buy that 10 pound bag or that big box at the 
Costco, whatever it might be, because you have only got half 
the money.
    Ms. DeLauro. Ms. Kaptur.
    Ms. Kaptur. Thank you, Madam Chair, for your leadership, 
and it is so great to have this hearing today. And we thank you 
all. You must be worn out by now. But we thank you for your 
service, and you have really important responsibilities, and we 
care about those responsibilities. And we are at the receiving 
end down in our districts. We get to see what happens in these 
cafeterias and lunch rooms. And as hard as we are all working, 
we have got to do better.
    And the focus of my questioning really will be on local 
food systems and sustainability at the local level and its 
relationship to our children and their health. And I am going 
to ask you to provide for the record, you may not be able to 
answer this today, for best practices around the country where 
those local connections have best been made to improve the diet 
of our children. I am going to tell you a little bit about 
Ohio, and I need your help.
    About 8 months ago Secretary Johner visited our district to 
look at ways of connecting our nutrition programs to local 
agriculture so that we could get more fresh fruits and 
vegetables; so that we could get better meals prepared; so that 
our local community could learn how better to do this. And 
subsequent to her visit, we passed a new Farm Bill.
    And the procurement process and the purchasing agreements 
for school lunch programs with these changes allow local foods 
to be used by local schools. However, within the State of Ohio, 
that doesn't happen. And food purchasing requirements there 
dictate that only one purchaser is the gatekeeper for all of 
the nutrition programs, and that person exists in the State 
capital in Columbus. And if a producer, a farmer, in our region 
wants to sell food to a school in our district they need to 
receive permission approval from that Columbus consolidated 
food buyer, and they must pay a royalty to that buyer and fill 
out very complicated forms in order to apply.
    Second Harvest Food Bank statewide director, and I wish to 
place her comments on the record, Lisa Hamler-Fugitt, who 
studied this more than anybody I know, says the following, the 
issue is that local school food service authorities, public 
entities, Department of Administrative Services, and even the 
U.S. Department of Agriculture have very complicated RFP and 
bidding processes that are far too extensive, complex and 
highly technical for most local producers to navigate and 
complete. In most situations only large companies with highly 
trained staff can complete these requirements. Many of the 
farmers, growers, and commodity producers that we work with at 
Second Harvest tell us that they don't have the knowledge, 
expertise, or resources to compete for those contracts. Many 
farmers and growers in Ohio report that far too many program 
procurement authorities aren't interested in working with them 
or with local producers and view their foods as less desirable 
and table-ready compared to packaged, wrapped, and prepared 
foods.
    [The information follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
                   BEST PRACTICES OF LOCAL PURCHASES

    So my request really is one of help. Perhaps does USDA have 
best practices around the country that you could share with our 
State officials? We would like to redo that visit with FNS in 
our region. We would like to bring in the State people. 
Secretary Johner said you better have them at the table because 
they are not here. Well, they didn't want to come.
    And so the interesting thing, and I will tell you the head 
of our financing arm of our largest school system, and I 
represent about 19 school systems in our region, came to a 
meeting in our office about a year and a half ago and said to 
me, well, Congresswoman, you are the first person that has ever 
asked me about the connection between education and nutrition, 
and he had been the chief auditor for the school system for 25 
years. So, in Ohio, the money for food goes through the 
Department of Education. They don't think about nutrition, and 
they don't think nutrition is their responsibility. So we have 
got to some how reconnect this at the local level. And I really 
believe USDA has the lead.
    I mean, the money we provide for food for our children, we 
should put restrictions on this, and we should make things 
happen, but we need to know best practices. And so my question 
to you really is, do you have examples in your office of 
experience around the country where this is being done well, 
where fruits and vegetables and produce are being provided to 
children? What can we learn from that, especially where our 
local producers, and where those exist, I am sure Utah doesn't 
have a lot of, maybe they do, but in Ohio, we can feed 
ourselves. If we choose to do that, how do we relink the 
producers to the consumers in these schools?
    Mr. O'Connor. We can certainly look for those best 
practices and provide them to you as you have requested. I 
think what you are touching on in this situation that you 
describe also illuminates the difficulties or the complexity 
really, not so much difficulties, but the complexities of the 
procurement processes and what rules apply and whatnot. We can 
take a look and see what is happening in Ohio in terms of what 
you have just described to us or whatever. We also can provide 
technical assistance, and we will look into doing that.
    [The information follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Ms. Kaptur. I would really love to do that for the Ohio 
delegation. I can't take care of the whole country all at once. 
Other people do that. But if we do it right in Ohio we think 
that our example will spread, and we really need the help 
there, because we have got some dysfunctionality, and the yield 
is children who are not eating properly in every one of these 
schools. I can tell you, just in my district, in looking at 
what money was spent on last year by one school system, they 
spent $650,000 on procurement of pizza, local pizza, from one 
of these standard companies. And I thought, wow. It is not even 
pizza with vegetables on it. So it is just interesting. I mean, 
it is like nobody thinks about it. It is like it all comes down 
these shoots. And in the end, you go into the cafeteria, and 
you see what is eaten, and you see what is thrown away. 
Something is not right here.
    Mr. Brownell.
    Mr. Brownell. If I might comment, there is a wonderful 
example of this working right in Berkeley, California. It got 
started by Alice Waters, a well known chef and author, who 
convinced one of the local middle schools to turn a parking lot 
into an edible garden essentially. They call it the Edible 
School Yard. And you can Google that and find a lot of 
information they have available. And the purpose was to get the 
kids involved with sustainability and growing local foods. Some 
of the food went into the cafeteria. The kids would do poetry 
readings in the garden. They learned elementary plant biology 
in the garden, et cetera. It really became a real focus in that 
particular school.
    And based on the success of that, the Berkeley Consolidated 
School District has decided to do that sort of thing district 
wide. And they hired a chef named Ann Cooper to come in and run 
the food service for the whole Berkeley school system. And she 
has worked out a lot of the problems that you mention about how 
to procure food for the whole school district, how to work with 
local farmers, how to get through the paper work and things. It 
could be that the California requirements are different from 
those in Ohio, and I wouldn't know about that, but they have 
worked out a lot of the problems and done it successfully.
    Ms. Kaptur. That is a very good example, Mr. Brownell. Does 
your Department have that in a little kit that members could 
receive or other examples like it?
    Mr. Brownell. The people in Berkeley do. If you go right to 
the Web site----
    Ms. Kaptur. The Edible School Yard.
    Mr. Brownell [continuing]. The Edible School Yard, you will 
find a variety of brochures, pamphlets and things like that, 
that you can download, that they could send you. And if you 
would like, I could get in touch with them and ask them to get 
you material.

                     PURCHASES BY SCHOOL DISTRICTS

    Ms. Kaptur. Yes. We need USDA's help to sort of put their 
arms around our State and to allow them to cooperate rather 
than resist. And actually, I would appreciate it.
    Here is another thing, Madam Chair, I am really interested 
in; the hardest information to obtain in my district through 
the State of Ohio is, of the Federal dollars that have come 
down for our breakfast and lunch programs, how much of what has 
been procured by each school district at what price? Try to get 
it. So if you can't even know what has been done, how can you 
possibly improve upon it? Do you collect that information? Is 
there a reporting back up the chain of command to USDA from the 
school districts?
    Mr. O'Connor. No, not from the school districts.
    Ms. Kaptur. How would we get that? That way you would make 
a very clear judgment on how much high fat McNuggets have been 
purchased versus how many apples and green peppers and low-fat 
yogurt. We don't have a way of measuring anything. Can you help 
me figure this out? How would we do this?
    Mr. O'Connor. I think that what we would have to do is a 
survey and ask for all that information to come in.
    Ms. Kaptur. All right.
    Mr. O'Connor. But that would be a large undertaking.
    Ms. Kaptur. What if you were just to take, selfishly, the 
Chairwoman's congressional district and my congressional 
district, and maybe Mrs. Emerson. Take the women on the 
committee. Oh, I like that idea. How about that? Three 
districts, would that be hard to do?
    Mr. O'Connor. My colleague is telling me we are looking at 
this right now at a national level but not to the level that 
you are talking about. We could do that. It would cost money, 
obviously. As Mr. Brownell was saying, there are ways to study 
things.
    Ms. Kaptur. Madam Chair----
    Ms. DeLauro. We can think that through, Marcy, and figure 
what we can do.
    Ms. Kaptur. All right. Thank you.
    Ms. DeLauro. Mr. Alexander.

                          CONFLICTING PROGRAMS

    Mr. Alexander. Thank you, Madam Chairman.
    I don't want to ask a question that might have already been 
asked, so I will just make a little statement talking about 
school. It won't take me but a couple of minutes to tell you a 
cute little thing that happened in my office. A couple years 
ago, Madam Chairman, before we voted for the CAFTA Free Trade 
Agreement, I don't remember when that was, a couple of years 
ago anyway, the Governor from Louisiana at that time, a lady, 
was very much opposed to the CAFTA Free Trade Agreement because 
she was afraid the South American countries may flood the 
market with sugarcane. And Louisiana is a big producer of sugar 
that comes from sugarcane, so she was opposed to it. And I had 
made the statement that I was for the CAFTA Free Trade 
Agreement.
    She sent a lobbyist into my office one day and said, we 
want to remind you that the Governor of Louisiana is very much 
against the CAFTA Free Trade Agreement. Louisiana produces, 20 
percent of the Nation's sugar that is consumed that is made by 
sugarcane or from sugarcane comes from the State of Louisiana, 
and I said I understand that. And she said, also, you remember 
the Appropriations Committee, and we have a request in to the 
Appropriations Committee, and we would like for you to help us 
make sure that it is funded. The Pennington Biomedical Research 
Center right off the LSU campus in Baton Rouge, the largest 
obesity research center in the world, and there is a request in 
for that.
    And I said, that is a government at its finest: Over here, 
we want to protect the sugar industry; and on this hand, we 
want to do what we can to do more obesity research. And that is 
just, for instance, how lopsided government can be at local, 
State, Federal levels.
    I made the statement last year, it just seems so strange we 
will, as a committee and as a government, we will subsidize 
milk producers to help them produce all the milk, and then when 
they overproduce cheese, well, we will spend a lot of money 
getting that out to food banks or commodity centers. And then 
somebody will say, oh, let us feed it to our school kids. And 
then 20 years down the road, it will stop their veins up, and 
then we will have to try to figure out what to do there. It 
just seems like there are so many times that we shoot ourselves 
in the foot.

                      VENDING MACHINES IN SCHOOLS

    Jack, that works behind me here, asked earlier if there is 
data out there to show how many Coke machines or soft drink 
vending machines are in schools. Do we have a comparison on a 
per-capita basis across the Nation? Does anybody know? Do 
parents ever approach the school boards and say, look, we need 
to put a stop to this? It shouldn't be up to the government to 
do a lot of that.
    Mr. Brownell. There are data available on the percentage of 
schools that have soft drink machines in them; less on how many 
in each school. But it is a changing number and changing fast 
in the right direction. There are a lot of school districts and 
States, too, that are taking action.
    It so happens Connecticut has the most aggressive school 
nutrition legislation in the country. So in the State of 
Connecticut, you won't find those machines. In other places, 
you will find a lot of them. It really depends. So the number 
is changing quickly. It is going in the right direction, but it 
is still a real presence in some school districts.
    And by the way, one of the issues that came up some time 
back in our discussion was a possibility the schools would lose 
revenue if the machines got taken out. That really is a myth 
for two reasons. One is that there is some research showing 
that if they put healthier things in the machines, kids will 
buy the healthier things, and the revenue stays about the same.
    But the other myth there, it is as if people sort of behave 
as if the soft drink companies are standing there handing money 
to the school district. But it is not the companies that are 
putting the dollars and the quarters into the machines, it is 
the kids in the school district. And the soft drink companies 
are taking a cut of it. So if the schools are going to have 
those kinds of machines, they would be better doing it on their 
own and going out to Sam's Club and buying big masses of the 
stuff and selling it on their own, not having to give part of 
it to the soft drink companies. But it is a real myth to 
believe that the companies are contributing to the education in 
a school district. It is more or less a tax because the kids 
are paying for it.
    Mr. Alexander. Thank you.
    Ms. DeLauro. Thank you very much. We do have a habit of----
    Mr. Alexander. Shooting ourselves.
    Ms. DeLauro. In the foot, right. I could think of a number 
of examples.
    I have organized myself here so that I know what my last 
two or three questions are going to be, and we will let you 
free, free at last.

                            WIC FOOD PACKAGE

    The WIC, we haven't talked much about the WIC Program here, 
the food package implementation. We haven't dealt with the 
guidelines since about 1974; 4 years since the IOM released a 
report, ``WIC Food Package: It is Time For a Change.'' That was 
the foundation for nutritional changes of the WIC food 
packaging. The interim final rule was published in December of 
2007. So 4 years for the rule.
    Since then, States have been working on implementing the 
WIC food packages. And I understand New York and Delaware are 
the only two States that have already implemented the changes. 
Where are the other States in implementing the changes? What 
issues are States encountering with implementing the new WIC 
food packages, and how are the changes being received by 
vendors and WIC participants? Are States providing outreach in 
education to ease this transition to the WIC food packages?
    Mr. O'Connor. All of the States are on schedule to 
implement the WIC food package changes by October of this year, 
which is good news. Some States will be implementing before 
that. As you noted, New York and Delaware are leading the pack 
there. There will be others coming on board. But it is a 
difficult transition for some States to be able to do that. It 
involves computer changes.
    Ms. DeLauro. What are the issues with regard--is it 
technical?
    Mr. O'Connor. Yeah. And there are limited dollars available 
in States to be able to make some of those changes. But having 
said all of that, we are on track to have all of the food 
package changes implemented by October of this year, which is, 
I think, good news for everybody involved.
    [The information follows:]

    The attached table indicates the anticipated implementation date 
for each State. Both New York and Delaware implemented the changes in 
January 2009. All States plan to implement by the October 1, 2009 
deadline. The implementation timeframes were determined by the State 
agency based on the State's assessment of changes required to its 
management information system, the training needs of staff, vendors and 
participants, and development of a new State Food list. The Food and 
Nutrition Service is providing technical assistance to WIC State 
agencies to assist them in implementing the interim rule by the 
deadline.
    From an electronic benefit standpoint, one major challenge is 
defining the new business rules and technical requirements for an 
electronic cash value voucher to allow for software updates to 
electronic cash registers and State agency systems. The national WIC 
office has facilitated a workgroup of States and industry to develop 
these requirements in order to meet the implementation dates required 
by regulation.
    We are also streamlining the WIC management information system 
approval process to enable State agencies to more easily make necessary 
changes to their management information systems to meet the 
implementation deadline.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Ms. DeLauro. Have there been any response in terms of the 
vendors or the participants on the change rather than the 
technical side of it?
    Mr. O'Connor. I think we anticipated some push-back from 
vendors and whatever. But it seems as though everybody is okay 
at this point.
    Ms. DeLauro. Good. And you feel comfortable with the 
outreach that the States are making in the education process to 
ease the transition.
    Mr. O'Connor. Yes.

                      FRUITS AND VEGETABLE PROGRAM

    Ms. DeLauro. The fruits and vegetable program, in your 
testimony, Mr. O'Connor you said that FNS estimates that the 
programs together supported nearly $11 billion in 2008 in fruit 
and vegetable consumption, through the distribution program. 
The 2008 Farm Bill provided $1.4 billion over the next 10 years 
to expand that program. And obviously, we talked about here 
today the increase of the consumption of fruits and vegetables 
in schools.
    In your view, where do we get the biggest nutritional 
impact on providing increased fruit and vegetable consumption? 
Is it in the School Lunch Program or through the Fruit and 
Vegetable Snack Program?
    Mr. O'Connor. It has to be looked at, I think, through the 
School Lunch Program, just because given the volume of dollars 
that are available.
    Ms. DeLauro. So we get our biggest bang for the buck 
through the School Lunch Program.
    Mr. Brownell. As an aside, one of my colleagues at the Rudd 
Center, Marlene Schwartz, did an interesting study in your 
congressional district in Gilford, Gilford schools, where she 
tested just changing a simple thing in the school lunch process 
where, instead of kids being asked or being able to pick a 
fruit, it was actually placed on their tray. They were given a 
choice of a fruit or a juice, but it was actually placed on 
their tray. And that simple change greatly increased fruit 
consumption in those kids. Now, there was a little waste. That 
is, you put it on the tray and some kids wouldn't eat it then, 
but many did. And so just that little tweak in the way that it 
is done. So that would be an example of a little study that got 
done, didn't take much time, cost almost nothing, but could 
have a big impact if it resulted in changed policy.
    Ms. DeLauro. Can I get a chance to see that study?
    Mr. Brownell. Yes.
    Ms. DeLauro. Great. I have got a couple more questions, 
Rodney, but let me, Mr. Alexander, let me yield to you.
    Mr. Alexander. I am fine. Thank you.

               NUTRITIONAL QUALITY OF COMMODITY PROGRAMS

    Ms. DeLauro. On the USDA, the commodity of foods, Mr. 
O'Connor, you have talked about an aggressive initiative that 
improved the nutritional quality of the FNS commodity program.
    Dr. Brownell calls on FNS to improve the nutrient quality 
of USDA commodity foods. What is the aggressive initiative FNS 
is pursuing, and what additional steps can the Department 
implement to improve the nutritional quality of the commodity 
programs?
    Mr. O'Connor. Well, some of the things that we have already 
done is that we have put in place changes to lower the salt 
content of the commodities that we provide. Lowering the sugar 
content by, for example, only offering canned fruits that are 
packed in light syrup or water or natural juices. We are 
cutting fat in the commodities that we supply. And we are 
increasing the variety of whole grains that we provide to 
schools as well.
    Ms. DeLauro. What is the total amount spent on purchasing 
commodities and how much can FNS require to meet these 
nutritional standards.
    Mr. O'Connor. Let me see if you have that. It is about $800 
million a year. It is all in entitlements and whatever. Closer 
to $1 billion, sorry.
    Ms. DeLauro. In terms of the purchasing of commodities, it 
is $1 billion.
    Mr. O'Connor. For the schools.
    Ms. DeLauro. Can we do something about requiring meeting 
nutritional standards with regard to the--as I understand it, 
the schools, you give them a list, they select what they want 
on the commodities, is that right? Can we do anything with 
regard to the requirement on nutritional standards on 
commodities?
    Mr. O'Connor. So that we are restricting the kinds of 
commodities?
    Ms. DeLauro. Yeah. In terms of the nutritional content of 
the commodities, or are we just shipping?
    Mr. O'Connor. The schools are choosing the commodities as 
part of their overall presentation or their overall efforts at 
meeting the nutritional standards for the entire meal. So the 
commodities that they are choosing are the whole package.
    Ms. DeLauro. So is that commodity purchase you are telling 
me, then, has to meet some nutrition standard that the school 
is subject to so that--the school has to take into 
consideration the nutritional standards when they are dealing 
with commodities.
    Mr. O'Connor. Yes, so the commodities are making up a part 
of the overall meal plan that the school has put together. The 
meal plan has to meet the nutritional standards.
    Ms. DeLauro. Is that working?
    Ms. Parker. I was just going to add before, in my previous 
job, I wrote a report on the commodity program, which I will be 
glad to share with you. It looks at some of these issues. In 
fact, we created a term called ``nutrition control,'' points 
which was basically to point out all the points at which 
decisions are made along the chain that could turn different 
ways and make a difference in terms of what the commodities 
ultimately end up looking like on a child's plate. So I would 
be glad to share that with you.
    But it is not--it is, again, a responsibility that has to 
do with Federal level, but with State level and local school 
district level; for example, often school districts don't have 
enough knowledge about how to make decisions about how their 
commodities are processed in a way that will produce products 
that will be more in--will allow them to stay more in keeping 
with the Dietary Guidelines. So there are places all along the 
way in which changes, small changes could occur that could make 
a difference.
    Ms. DeLauro. And in essence, and I am just speaking out 
loud here, it gets back to looking at improving the nutritional 
quality of the commodities that we purchased rather than 
leaving most of it up to what commodity prices we have to 
support. Is that a fair comment?
    Ms. Parker. Well, the one thing I would say is that, as I 
understand it, according to what research I did, actually 
things like beef, for example, is the leanest beef on the 
marketplace. So, in fact, it is important to really look at, 
specifically at, what products are there. And in some cases, 
they could be improved. In other cases, they are doing a pretty 
good job. It is also an issue of how people make choices 
however. If most people use all their money to buy meat but 
don't spend very much of it on fruits and vegetables, that is 
an interesting thing to look at.
    So I guess what I am saying is, it is a lot more complex 
than meets the eye. And what States offer to local school 
districts, what school districts understand about how to order 
food from companies that process the commodities, all of those 
things have an impact on what is on the child's plate.

                      CHILD NUTRITION INITIATIVES

    Ms. DeLauro. I just have a comment and then one last 
question, or one last comment from all of you.
    Dr. Brownell, you have laid out some possible new 
initiatives. You talked about the commission at the Institute 
of Medicine on an economic and health analysis of the impact of 
subsidies, how we can use that subsidy policy to better address 
the nutritional needs and concerns and health concerns that we 
have, the impact on food prices on a Nation with a vulnerable 
population and food access, and really take a look at that and 
how we go about trying to implement that.
    I know that CRS has done some things. About initiatives, 
they say they are out here at the moment. I will just say this 
to you, Mr. O'Connor, that CRS says Child Nutrition Programs 
initiatives include the following: Providing mandatory funding 
for a currently authorized pilot project raising income limit 
for free school meals to 185 percent of the Federal policy 
income guidelines; authorizing a School Breakfast Program in 
which all foods are served free without regard to family income 
in place as a current breakfast program. These are initiatives 
that are out there, is that accurate, are these accurate? These 
are ideas? These are not initiatives?
    Mr. O'Connor. Right.
    Ms. DeLauro. Okay. Authorizing start-up grants for School 
Breakfast Programs; expanding the provision of the Federal 
child nutrition subsidies for dinners served in after-school 
programs in additional States. Let me just tell you that got 
shot down in the Recovery program. I can't make people 
understand what is going on here, but, you know, we live to 
fight another day.
    Simplified Summer Food Service Program rules nationally 
applicable; the competitive foods requirements issue; 
establishing and funding a competitive grant program for 
schools to create healthy school nutrition environments; 
assessing the effect of these environments on the health and 
well being of their students; expanding the summer food service 
program; increasing the number of areas in which the meals are 
offered; start-up grants for a new summer program; making 
nationally applicable rules now used in a pilot project in 
Pennsylvania that ease participation by summer program sponsors 
in rural areas.
    So these are not initiatives, but they are ideas. Are there 
any that jump out to you that are along that we are really 
taking a hard look at? No, you don't know, or we are not? I am 
not asking you to comment on the policy. I just want to know if 
there is anything in the pipeline with regard to any of this 
effort or that we have to start from scratch and try to take a 
look at them.
    Mr. O'Connor. Much of that is in the pipeline.
    Ms. DeLauro. Well, if I send you this list, can you then 
tell me what is in the pipeline, what isn't and where in the 
pipeline it is?
    Mr. O'Connor. I think we will need to defer to the 
Secretary on that.

                    CHILD NUTRITION REAUTHORIZATION

    Ms. DeLauro. Okay. As I say, he is here next week.
    A final question to all of you. We are going to deal with 
the reauthorization of the child nutrition WIC reauthorization 
this year. Let me just ask you, what would be your top priority 
for that reauthorization?
    Mr. O'Connor. I am being told our top priority is that it 
happen this year.
    Ms. DeLauro. Okay. Ms. Parker.
    Ms. Parker. I don't think the Institute of Medicine takes 
positions on legislative issues.
    Ms. DeLauro. But I mean, just what would be a good thing?
    Ms. Parker. Well, let me do this. I will talk from my 
personal----
    Ms. DeLauro. Talk from your personal, that is right, 
because you have got a good background in all this stuff.
    Ms. Parker. Let me say two good things. One good thing 
would be to ask the Secretary of Agriculture to give the 
Secretary of Agriculture the authority to do some new--require 
the Secretary of Agriculture to do competitive food regulations 
and expand it to the whole school and the whole State and put 
that through some kind of a regulatory process, so that and 
perhaps use our IOM standards as the basis.
    And the second thing I would say, and this, again, is 
personal, is to do what we can to increase access to Child 
Nutrition Programs whatever form they take, so that, 
particularly in the current context with poor families, that 
kids get the nutrition they need, enough nutrition.
    Ms. DeLauro. Dr. Brownell.
    Mr. Brownell. And I would say, similar to what Lynn 
recommended, better nutrition standards in schools that would 
focus on two things. One is how to drive up consumption of the 
things we would like to see children eat more of, and how to 
drive down consumption of the things children should eat less 
of.
    And then second would be to be a little more aggressive 
with the school wellness policies, as we discussed. Whether to 
try to figure a way that policies can become programs and to 
provide some guidance from Washington about what an ideal 
policy and set of programs would look like.
    Ms. DeLauro. We will conclude. It is 4:15. You have been 
here since 1:00. So I much appreciate your time and your 
patience. I will say that we did take an hour out of this to be 
able to go over and vote, but that didn't--I can't tell you how 
much I appreciate your being here and your thoughtfulness and 
your candor about the kinds of things that we ought to do. I 
believe this is a very, very big issue. We face this as a 
Nation.
    I think it is a crisis of proportions in terms of the 
effects of--and I believe the agencies are trying to do a good 
job, I truly do. This is not about gotcha. This is not about 
just casting aspersions or trying to--but I think we can do 
better. And we have an obligation to do better. The end of the 
line is public health, and we are failing on that public health 
measure, not because we wanted to, but somehow--and we never 
talked about the link between poverty and hunger and obesity 
and all of this, which are big, big social issues, which we 
have to grapple with. But we have it within the purview of this 
subcommittee. We are not an authorizing committee, but we have 
the purse. We can try to help make some changes through what we 
do. We need, obviously, the cooperation of the agency. And from 
what I have heard from some of the nutrition groups, that they 
are excited about what the Secretary has been talking about and 
where he is coming from on the issue of nutrition.
    And I know that people in the agency are clamoring for this 
as well. And we need the benefit of the expertise of you, Ms. 
Parker and you, Dr. Brownell, to help us to formulate and craft 
legislative initiatives so that we can get to good public 
policy in this area. So thank you very much for spending all 
this time with us today. I appreciate it. And this hearing is 
concluded. Thank you.

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                                           Tuesday, March 31, 2009.

                       DEPARTMENT OF AGRICULTURE

                               WITNESSES

HON. THOMAS VILSACK, SECRETARY OF AGRICULTURE
W. SCOTT STEELE, BUDGET OFFICER

                     Ms. DeLauro Opening Statement

    Ms. DeLauro. The committee is called to order.
    Before I make my opening remarks or ask Mr. Kingston to 
make some remarks, I would just like to yield to Mr. Latham, 
who shares the geography with the Secretary.
    Mr. Latham.
    Mr. Latham. Thank you, Madam Chairman.
    I just wanted to, as a fellow Iowan, welcome you and 
congratulate you on your appointment as Secretary. We are very 
proud and look forward to working with you.
    Thank you.
    Ms. DeLauro. Thank you very much, Mr. Latham.
    In fact, we want to all welcome you here this morning, 
Secretary Vilsack. It is a delight to be with you, and thank 
you very, very much for being here.
    I know that this is your first opportunity to testify 
before Congress since you have been sworn in, taking the time 
to be with us this morning, even as you continue to settle in 
and staff up, and I know that is a concern.
    Let me just say to you, Mr. Secretary, you bring a 
lifetime, really, of service and an impressive record on 
agriculture and nutrition issues to the new role that you have. 
As Governor, you achieved a lot for family farmers, livestock 
producers, rural communities. Fighting hunger took center stage 
during your administration, and you made rural development a 
real priority with the Iowa Values Fund. I know that you are 
committed to protecting public health and building a framework 
for growth in small towns and communities across America. I 
look forward, too, and I know that the committee does, the 
subcommittee looks forward to working with you and the very 
many dedicated men and women at the USDA to make good on that 
commitment.
    Of course, we also know that you are coming into a 
Department--and I will say it is my view--that is desperate for 
reform. In recent years, the Department has struggled to 
fulfill its own mission and to meet the needs of the American 
people, and today we have an opportunity to make the Department 
a powerful force for good.
    I believe we made an important first step by making 
critical investments with the recovery package: $20.9 billion 
in nutrition programs; $1.2 billion for essential community 
facilities in rural areas such as health care, fire, rescue and 
public safety services; $3 billion for guaranteed loans to 
rural businesses; and $340 million for watershed and flood-
prevention activities that are ready to begin work this year.
    But we must go farther. We need to build on these resources 
and commit to reforming the Department on every front.
    First, on nutrition, this subcommittee has already held an 
oversight hearing this year on the reach and the impact of 
USDA's nutrition programs, the school lunch program, in 
particular. And I am trying to go back and to find it, and I 
have asked staff to look at it. I understand that in the 1977 
Farm Bill that the U.S. Department of Agriculture was 
designated as the lead agency in nutrition in this country. So 
that is what, in fact, I believe it ought to be.
    And I know that you and the President are committed to 
confronting childhood obesity as we implement the Farm Bill and 
begin work on childhood nutrition reauthorization. We have an 
opportunity to make concrete improvement in the health and the 
lives of America's children.
    I believe that USDA should work to reduce barriers and 
increase resources for more direct connection between the 
demand and the supply on the part of school food services and 
family farmers, between local schools and food networks.
    More broadly, the Department has also the opportunity to 
immediately improve resources to rural communities, open 
markets, to local farmers, and to reduce health disparities in 
the process.
    Second, food safety. Americans should be able to assume 
that the food that they serve their children is safe to eat. 
Unfortunately, from peanuts to ground beef to peppers to 
imported seafood and, just yesterday, pistachios--the word on 
the pistachios is, don't eat them, but don't throw them away, 
because we are not sure yet what the situation is. But don't 
eat them. It gives you pause.
    We have seen one devastating case of widespread food-borne 
illness after the next. President Obama has already made it 
clear that this is not acceptable, and I hope that his proposed 
Food Safety Working Group can begin to bring serious reform 
that we need in this area.
    I have long been concerned about USDA's dual mission of 
promoting the products it is supposed to regulate. I believe 
this inherent conflict of interest at the agency has 
contributed to some of the food safety problems we have 
encountered over the years.
    We must work to modernize the Food Safety and Inspection 
Service in a way that emphasizes prevention, not just reaction, 
and recognize that as long as the threat from food-borne 
pathogens are constantly evolving, so, too, must our food 
safety system.
    And to stay ahead, we need to continue to prioritize 
certain key principles. We need to look at the foods that are 
at greatest risk. We need to categorize facilities based on 
risk. We need to establish performance standards for food-borne 
pathogens. We need to look at those risk-based efforts in terms 
of frequency of inspections and the reporting requirements for 
companies.
    Third area, rural development. For too long the importance 
of the nonagricultural economy in rural communities has not 
been reflected in USDA priorities. Today, even farmers are not 
earning their primary living from agriculture. Eighty percent 
of farm household income is derived off the farm.
    The Department needs to rethink its mission and its 
priorities, giving just as much attention to rural development 
as it does to production agriculture. That means working to 
reach more vulnerable families and workers in rural areas, 
including small farmers, low-resource farmers, and minority 
farmers and small landowners.
    Also, coordinating with Health and Human Resources, 
Commerce, Transportation, investing in rural infrastructure, 
including broadband, not only to connect rural areas to the 
global economy, but also to generate growth in rural America. 
And I know this is a priority for you, and I want you to know 
that I will be there fighting for that right by your side.
    We fought very, very hard in the economic recovery package 
to make sure that there were resources that went to the U.S. 
Department of Agriculture and to RUS for broadband. RUS does 
have a program, quite frankly. Commerce hasn't started up yet 
with a program in this area. So we are looking to you for 
leading the way in this area.
    Finally, energy. Secretary Vilsack, I know that you will 
continue to work to ensure that agriculture is an integral part 
of our push to make renewable electricity affordable and 
accessible. On this critical issue we must prioritize research 
and conservation to find the right balance between our need to 
move energy independence and minimizing the impact on the 
environment, while at the same time we need to closely monitor 
the impact of increased mandates for biofuels on the 
environment and on food prices. Each of these issues--
nutrition, food safety, rural development, energy--they are a 
priority for this subcommittee; and they are ready for reform 
within the U.S. Department of Agriculture.
    Mr. Secretary, I have confidence, real confidence. We have 
had the chance to work together in the past, and I welcome your 
leadership of this Department and your ability to bring the 
change that it needs. So I am delighted that you are at the 
helm. I look forward to collaborating with you in the months 
ahead.
    This is our big opportunity. You know, challenges bring 
opportunity. We know that, and it is our opportunity to get 
things right for the American people, to make the kinds of 
changes that will affect their health and their safety, their 
quality of life and their economic livelihood.
    Thank you very much for being here this morning.
    With that, let me ask ranking member, Mr. Kingston, to make 
his opening statement.

                     Mr. Kingston Opening Statement

    Mr. Kingston. I thank the Chair for yielding.
    Mr. Secretary, welcome to this committee; and we certainly 
look forward to working with you. I have heard lots of good 
things about you; and despite the fact that many of them came 
from Mr. Latham, I am still inclined to believe them.
    As the loyal opposition here, I want to say something, 
though, that sometimes goes beyond this committee. Certainly it 
does. I am very concerned, as we all are, about the spending 
level of this administration so far, a deficit over $1 trillion 
projected.
    You know, frankly, as Republicans, we did not do a very 
good job of controlling spending. We should have done a better 
job. But it now seems like those in the administration are 
using, well, look what the Republicans did, and so we are going 
to make it a lot worse. Your budget, for example, has a 12 
percent increase on top of what I understand, in 2009, is about 
a $24 billion budget; fiscal year '10, a $26 billion budget; 
the stimulus, a $5.7 billion increase.
    You know, I am very concerned that this stuff is just 
getting out of hand and that in each department of this 
government we need to start looking at ways to save. Now, you 
have rightfully raised the issue that there was $49 million 
paid between 2003 and 2006 to ineligible participants in farm 
programs because their income was too high. So they certainly 
should never have gotten that money, $49 million, for people 
who did not qualify for it. We want to join you in trying to 
stop that and trying to focus in on that money.
    On the same hand, in 2006, overpayments in food stamps was 
$1.29 billion. So about--almost as high as 5 percent of the 
food stamp budget was paid to people who were not qualified for 
food stamps. I certainly hope that we can join you in pursuing 
that and stopping that. Because anytime that you take money 
away from--that you were ineligible for, you take it away from 
somebody who was eligible for it.
    And in the same way, anytime somebody receives a benefit 
for not working, whether they were able to work or unable to 
work, that benefit was paid for by somebody who worked for it 
and will not get compensated for it. And we need to keep that 
in mind, too.
    So I am looking forward to working with you. The USDA is 
near and dear to everybody on this committee.
    Most of the issues are nonpartisan, but I think that the 
philosophy--and I believe with the last administration my 
questions about their spending were the same as my questions 
will be to you. I feel that sometimes just we in this town have 
an inertia towards spending more as a way of quieting down our 
critics, rather than going after some of the tougher decisions 
and challenging the status quo.
    But I will remain a member of the loyal opposition in that 
respect, because I think we can work with each other on it. 
And, again, this is consistent with the questions I asked of 
the person previously in your seat.
    So I yield back.
    Ms. DeLauro. Thank you, Mr. Kingston.
    Mr. Secretary, your full testimony will be made a part of 
the record, so we will ask you for your testimony. And if you 
choose to summarize, we are ready to listen; and then we will 
move to questions.
    Let me welcome Mr. Steele. Thank you so much for being 
here. You are a staple on this dais here, Mr. Steele. So we are 
delighted to have you with us again this morning. Thank you.

                  Secretary Vilsack Opening Statement

    Secretary Vilsack. Madam Chairman and Representative 
Kingston and other distinguished members of the Committee, I 
appreciate the opportunity to appear before you to discuss the 
administration's priorities for the Department of Agriculture.
    As the Chair indicated, I am joined today by Scott Steele, 
USDA's Budget Officer.
    President Obama outlined three key goals for the Department 
of Agriculture when I agreed to serve as his Secretary of 
Agriculture.
    First, he was very concerned about the health and welfare 
of America's children and wants to make sure our children have 
access to more nutritious food. Second, he wants to make sure 
we do everything we can to expand the capacity of our farms and 
ranches and produce alternative forms of energy. Third, he 
wants to make sure that we aggressively pursue research 
necessary to allow agriculture to transition away from its 
significant dependence on fossil fuels.
    In addition to the President's goals, there are several 
other factors that will shape the direction and focus of this 
Department.
    We face the challenges of protecting our food supply. The 
recent food safety emergency, where bad peanut butter products 
led to hundreds of illnesses and cost nine people their lives, 
provides a painful reminder of how tragic the consequences can 
be of an irresponsible firm.
    It is fairly clear, after my conversations recently with 
those associated with the peanut industry in Georgia, that they 
are feeling the direct consequences of that one company's 
failure to maintain a safe and secure product. This illustrates 
the important role that food safety plays in protecting not 
only consumers but the integrity of markets as well, and it 
will shape the direction and future of USDA.
    I was proud to announce in my first weeks here at USDA the 
publication of a final rule banning the use of nonambulatory or 
downer cattle in the food supply. This was an important and 
long-overdue action that will enhance the safety of the food 
supply and improve consumer confidence in our food supply.
    I intend to work hard at USDA to modernize and improve the 
way we regulate the food supply and to take steps to drive down 
the incidence of food-borne illness.

                     USDA ECONOMIC STIMULUS FUNDING

    The financial crisis we are all too familiar with has 
already shaped the direction the USDA will be going. With the 
passage of the Recovery Act, we have already begun the process 
of putting America back to work.
    On March 9, I announced the first wave of USDA economic 
stimulus funding. This funding will have a significant impact 
not only in rural communities but in communities across the 
country struggling with today's tough economic times.
    Consistent with the President's commitment to implement the 
Recovery Act in a manner that is transparent, effective, and 
efficient, I have established the Department of Agriculture 
Recovery Team to oversee the implementation of the Act. This 
team is headed up by my office, and it includes representatives 
from all mission areas that receive funding under this Act.
    The projects announced on May 9 are just the first 
accomplishments for the team. They are continuing to work 
diligently to identify all actions that need to be taken to 
expend the money, including the identification of projects that 
can receive funds and expend them quickly, while establishing 
accountability systems or mitigating potential implementation 
risks.
    Following the guidance established by the Office of 
Management and Budget, we will be able to demonstrate to the 
public that their dollars are being invested in initiatives and 
strategies that make a difference in their communities and 
across the country.

                         2008 FARM BILL FUNDING

    The current drop in commodity prices and difficulties of 
drought and other severe weather faced by large areas of farm 
country add another level of complexity to the work we have 
before us. To address these challenges, we must implement the 
2008 Farm Bill in the manner intended by Congress and provide 
farmers with a robust safety net and protections from market 
disruptions, weather disasters, pests, and disease that 
threaten the viability of American agriculture.
    Today, I would like to use this forum to make three 
announcements in the area of the farm safety net that should 
help producers struggling with recent downturns in commodity 
prices.
    First, in the dairy sector, in addition to last week's 
announcement of USDA's utilization of 200 million pounds of 
nonfat dry milk for school feeding programs and the TEFAP 
program, I would also like to announce that this week USDA will 
be making milk-income-lost contract payments.
    Secondly, I announced today that USDA is making bonus 
commodity purchases to aid struggling parts of the farm sector 
through USDA's section 32 authority. These purchases are in the 
amounts of $30 million for walnuts, $25 million for pork, $60 
million for turkey, and $2 million for lamb.
    Lastly, in response to concerns I have heard from producers 
worried about the upcoming June deadline for farm program sign-
up, I am announcing today that USDA will be extending the sign-
up deadline to August 14. This action should provide producers 
with sufficient time to learn about the new ACRE Program and to 
make informed decisions about their sign-up options.
    We also have an important role in working hard to expand 
exports for our agriculture products. It is significant that, 
while the country as a whole has a trade deficit, agriculture 
has a trade surplus. We need to continue to work hard, both in 
Washington and in our offices overseas, to encourage greater 
exports of American products.
    The agriculture census also reveals some significant trends 
that will guide the Department's directions over the next 
several years. A significant trend was the decline of middle-
sized farms. Some of these folks probably migrated into larger-
sales category, but many went out of business.
    Another rather startling fact is that, of the 2.2 million 
ranchers and farmers in this country today, 900,000 of them, 
almost half, have to work off the farm at least 200 days. That 
is pretty much a full-time job. When you factor in the average 
age of a farmer is increasing, a 30 percent increase in the 
number of farmers over the age of 75 and a 20 percent decrease 
in the number of farmers under the age of 25, you see that we 
are at a critical juncture in rural America.
    So you take all of that--the President's instructions, 
current events, the financial challenge in the stimulus 
package, and the trends in agriculture--and what it tells me is 
that we have a lot of work to do.
    But with these challenges come historical opportunities for 
agriculture in rural America. I look forward to working 
together with this committee and all of our stakeholders to 
capture these opportunities for long-term benefit for producers 
and all Americans. With the funding in the Recovery Act and the 
President's 2010 budget, we have the capacity to capitalize on 
these opportunities. We intend to approach these issues with 
much greater transparency and the involvement of the full 
diversity of stakeholders we serve.

                          USDA KEY PRIORITIES

    I would like to give you an overview of our key priorities. 
Recent economic woes have caused a dramatic increase in the 
number of Americans needing support through nutrition 
assistance programs operated by USDA. Most notably, 
participation in the Supplemental Nutrition Assistance Program 
has increased by 4.2 million Americans in the last 12 months, 
for a total of 31.8 million participants monthly.
    The Recovery Act funding for SNAP will be released by April 
1. Not only will this funding provide critically needed support 
for millions of Americans having trouble acquiring a nutritious 
diet, it will also have an immediate effect on stimulating the 
economy.
    Participation in the Special Supplemental Nutrition Program 
for Women, Infants, and Children has also continued to grow 
substantially this year, averaging nearly 9 million 
participants monthly through December of 2008.
    Consistent with the President's commitment to present an 
honest, transparent budget, we are including sufficient 
resources in our budget request to support estimated 
participation in all of the nutritional assistance programs, 
including an estimated average participation of 9.8 million in 
the WIC program in 2010. This will ensure that all eligible 
individuals seeking to participate will, in fact, be served.
    The health care crisis dictates the need to promote 
improved nutrition. As reported by the Centers for Disease 
Control and Prevention, research shows that being obese during 
childhood and adolescence is associated with being overweight 
during adulthood.
    The Department can play a key role in addressing the dual 
issues of childhood obesity and alleviating hunger by improving 
program access and enhancing the nutritional quality of school 
meals. We have an enormous opportunity this year as we 
reauthorize the child nutrition and WIC programs. An indication 
of our commitment to this important issue is that the 
administration is proposing an additional $1 billion annually 
to improve the child nutrition programs.
    As part of reauthorization, I look forward to working with 
Congress to improve the quality and nutrition of meals served, 
expanding nutrition research and evaluation, encouraging 
greater consumption of fruits and vegetables, which I consider 
anytime foods, and reducing the consumption of nonnutritious 
foods commonly found in vending machines, particularly in 
elementary and middle schools. Efforts in this area will also 
offer great opportunities for farmers, particularly specialty 
crop producers, who will benefit from greater emphasis on 
fruits, vegetables, and nuts in the diets of American school 
children.
    Further, we can enhance the success of local food systems. 
Our international food aid program, such as the McGovern-Dole 
International Food for Education and Child Nutrition and P.L. 
480 Title II programs are critical to addressing food 
insecurity throughout the world.
    At the same time, however, we must go beyond providing 
commodities, and we must also support efforts to increase 
agricultural production and develop agricultural sectors in 
food insecure regions. Economic development not only helps 
these countries but also helps the United States, because as 
their economies grow they become more active trading partners.
    We also see a number of opportunities for farmers and 
ranchers to capitalize on emerging domestic markets.
    Agriculture has demonstrated a capacity to help meet 
America's energy needs with clean, renewable fuels, but our 
success to date is only a small part of the potential in this 
area. The Department will expand renewable energy opportunities 
and the capacity of our land, our farms, and our ranches to 
produce alternative forms of energy and fuel; and I look 
forward to working with the committee on these efforts to 
promote renewable energy technologies.
    We also need to ensure we provide American farmers with a 
robust safety net, including supporting independent producers 
and local and organic agriculture and enforcing the Packers and 
Stockyards Act.

                            NEW TECHNOLOGIES

    We also need to take advantage of new technologies like 
biotechnology, which will create new opportunities for jobs and 
increase productivity. And we can develop programs that 
recognize the value of farming in protecting the environment, 
while assisting producers in transitioning from traditional 
farm programs to market-based environmental service markets.
    USDA is going to support developing markets that reward 
producers for sequestering carbon and limiting greenhouse gas 
emissions. Through the authority provided under the Farm Bill 
of 2008, we will address the metrics and certifications 
associated with environmental services of conservation and 
certain land management activities to facilitate the 
participation of farmers, ranchers, and forest land owners in 
emerging environmental service markets.
    We will also increase research and analytical capabilities 
and conduct government-wide coordination activities to 
encourage the establishment of markets for these ecosystem 
services.
    You are going to see a major effort, starting with the 
implementation of the Recovery Act and continuing through the 
implementation of the Farm Bill, to rebuild and revitalize 
rural communities in this country.
    Of great importance to me, the budget proposal and Recovery 
Act are consistent with the administration's efforts to ensure 
that all of rural America will have access to quality broadband 
service, which is essential to keeping pace in a world that 
relies on rapid telecommunications.
    The 2010 budget, combined with funding from the Recovery 
Act, will also provide strong support for homeownership in 
rural America by making mortgage credit available through 
direct loans and guarantees made by private lenders. This 
combined level of funding will provide over 165,000 
homeownership opportunities for rural residents. In addition, 
it contains sufficient funding to assist low-income tenants of 
USDA-financed rental housing.
    We are also proposing an innovative new initiative in the 
2010 budget to support rural revitalization through incentives 
for teachers working in rural areas and enhancing support for 
rural research and extension programs at land grant and 
minority-serving institutions. These efforts will greatly 
enhance our ability to strengthen the capacity of rural America 
to participate in new economic opportunities that we are 
developing, including renewable energy and environmental 
services markets.
    Madam Chair, I am aware of your deep interest in food 
safety. I share that interest. I want to work with you and 
members of this committee to ensure that we have the food 
safety system that we need to protect consumers. This should be 
a system that eliminates hazards before they have an 
opportunity to make anyone sick, but, in the event they do, a 
system that rapidly identifies and responds to the threat. To 
that end, you are going to see a very significant effort on our 
part to improve the safety and security of our food system.
    On March 14, the President kicked off that effort by 
establishing a new Food Safety Working Group, of which I am a 
member. We will advise the President on how we can upgrade our 
food safety laws for the 21st century, foster coordination 
through government, and ensure that we are not just designing 
laws that will keep the American people safe but also enforcing 
them.
    As I mentioned earlier, I am committed to implementing the 
2008 Farm Bill in a timely and effective manner. This is a 
tremendous undertaking for the Department, and I know that USDA 
employees share my commitment. We appreciate the funding 
included in the Recovery Act that will facilitate 
implementation of the Farm Bill.
    I want to thank the committee for providing the $50 million 
in recovery funds for IT stabilization and modernization for 
Farm Service Agency. We will continue to work with this 
committee to ensure that we have the resources necessary for 
further modifications to these IT systems, which are a critical 
asset needed to effectively and efficiently implement the Farm 
Bill and related programs.
    President Obama is very clear that this budget will be 
transparent to the American people. It will fully account for 
the cost to operate government. As I described earlier, our 
budget meets that test. The President, in his address to 
Congress, stressed that we are reviewing all of our options for 
wasteful and ineffective spending. Therefore, the 2010 budget 
reflects the elimination of earmarks and funding for programs 
that are not as high a priority as others I have mentioned or 
provide services that can be supported by other means.

                          CIVIL RIGHTS POLICY

    Finally, I would like to address one last area where the 
Department has a disturbing history. For far too long the image 
of the USDA has been marred by discrimination in the delivery 
of its programs and its employment practices. One of my first 
actions since arriving at the Department was to issue a civil 
rights policy statement that stated that discrimination will 
not be tolerated at USDA. To achieve this goal, we are 
dedicating resources necessary to improve the civil rights 
process within the Department.
    On February 26, 2009, the President released an overview of 
the 2010 budget. The details of the budget proposal will be 
released later in the spring. We have begun the process of 
making tough decisions about where our priorities lie, and we 
have made some tough choices about where to invest our 
resources. These choices reflect the new direction the 
President wants this country to take at a historic time. In my 
view, the President is on the right track, the track that takes 
this Nation on the path to recovery, provides the foundation 
for diverse opportunities for farmers and ranchers to succeed 
as they play an increasingly important role in the 21st century 
American economy.
    Madam Chair, that concludes my statement, and I will be 
pleased to take questions at this time.
    Ms. DeLauro. Thank you very much, Mr. Secretary.
    [The information follows:]

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                              FOOD SAFETY

    Ms. DeLauro. Let me just pick up on the food safety issue, 
if I might, and just get some more information from you and how 
you see this effort moving forward.
    It was after the peanut butter debacle you said you favored 
a single food agency. I don't think you have given more details 
yet about what you would like to see. Can you expand on the 
thinking, your thinking on this issue? Do we need a single food 
agency? If so, how should it be structured? Where, in your 
view, should it be located? USDA? FDA? An independent agency?
    You mentioned the independent Food Safety Working Group, 
and I understand that two-thirds of the working group has yet 
to be confirmed but would like to get your thoughts on this 
issue of a single food agency.
    Secretary Vilsack. Well, first and foremost, let's start 
with the statistical basis for our concern. According to recent 
data, 75 million Americans suffer a food-borne illness at some 
point in time during the year, 325,000 of them are 
hospitalized, and over 5,000 die.
    I think most in this committee--all of this committee and 
all of Congress would admit that those numbers are startling 
and unacceptable and reflect the need for us to reform the 
system.
    I appreciate the President directing myself and the 
Secretary of Health and Human Services to head up this working 
group for the purpose of determining the appropriate steps to 
improve our food safety system. I anticipate that this working 
group will work in concert with staff, once the confirmations 
take place, to begin the process of asking the critical 
question, what steps do we have to take?
    And I think the first question that has to be asked is, 
what is the controlling philosophy behind the food safety 
system? Is it one of prevention or is it one of mitigation?
    It seems to me that today what we have is a circumstance 
where we may have competing philosophies. With USDA focused 
primarily on prevention through its inspection regulation 
system, the FDA, because of the quantity of work that it is 
required to do and the fact that it has probably been difficult 
for them to do all the work they have to do with the staffing 
requirements that they are currently meeting, they have been 
focused on mitigation.
    I think, first and foremost, we have to focus on the right 
philosophy. I don't want to prejudge the work of the working 
group or of this committee or of this Congress, but I would 
suggest that it would make sense for us to focus on prevention 
and focus in a way in which we are able to identify, as you 
indicated in your statement, the most significant risk and 
focus our time and attention and resources on making sure that 
we address those risks aggressively.

                  RISK-BASED ASSESSMENT PILOT PROJECT

    We have started that process at USDA with a series of pilot 
projects, where we are working on a risk-based assessment 
process. I will tell you, Madam Chair, we still have much to 
learn about that system. We have a lot to learn about how data 
is collected, how it is evaluated, and what needs to be done in 
order to be comfortable that that is the right approach. I 
think we are on the right track, but I think we have a ways to 
go.
    Once you have the right philosophy, then it seems to me 
that the next step in the process is to make sure that you 
actually coordinate between the various agencies that are 
involved. As you well know, we have 15 separate agencies in 
this government that have some piece of food safety.
    I have had conversations with Secretary Napolitano about 
Customs and about APHIS and the role that APHIS can play in 
increasing training for Customs. We have, obviously, 
conversations that will take place with HHS about the 
interactions and coordination.
    Once we have that in place, then I think we can get to the 
structure, the structural questions, the organizational 
structure questions. And I really think that it would be 
inappropriate for me, at this point in time, to say it should 
be in one agency or another or a separate agency. I think that 
the process needs to work so that it can be as informed a 
policy decision as we can possibly make. But, clearly, we need 
to work on harmonizing the philosophy on making sure that there 
is better coordination and on making sure that the questions 
related to any risk-based process have been fully answered.
    Ms. DeLauro. Mr. Secretary, I appreciate what you are 
saying. What I know about evaluating processes in this 
institution and in agencies, et cetera, we could take a very, 
very, very long time to get where we need to go. I don't think 
we have time to get where we need to go. We have to be 
thoughtful in this process. There isn't any question about 
that.
    But you also have trains leaving the station; and, in the 
House, you have food-safety legislation that is in the process 
of being put together by the Energy and Commerce Committee, 
which is the authorizing committee.
    You have a number of ideas--and I don't have to reiterate, 
you know, my own approach on this effort. But my suggestion is 
that this administration is going to have to weigh in on a 
direction to take before we put into place legislation that may 
not get us where we wanted to go in terms of food safety and 
the kinds of structures that get us to be able to get the 
information that we need.
    It wasn't too long ago on this subcommittee that we were 
told that FSIS was moving headlong into risk-based inspection. 
You can't do anything on risk-based unless you have the data on 
which to move. Ultimately, FSIS and the Department viewed that 
our concerns were legitimate. So they held off in that area. 
And I am proud to say that as a subcommittee, both Democrats 
and Republicans, we held them off in moving in a direction that 
I believe would have not been helpful.
    But my point is that we need to begin and to have an 
administration begin to take a stand on where we are and where 
we want to go. We have opportunities to put into place the 
pillars that will get us to--and I am not going to put words in 
your mouth, but just to say that if we have 15 agencies today 
that are dealing with this issue and we are unsuccessful at 
dealing with food safety, given the current structure, with no 
single individual being responsible for food safety in this 
country--not one person has ultimate responsibility--that leads 
me toward a single agency.
    It may be that as an interim goal, as we take a look at 
where the bulk of the difficulties have been--and I think we 
need to review FSIS and the HACCP process. It has been in 
place--what--14 years or so. What does it do? But it was a very 
formidable response to an emergency with Jack in the Box years 
ago.
    We are in an emergency situation today. We cannot afford to 
take months and months and months of deliberation before we say 
to the American people, the Federal Government is going to take 
on this responsibility, try to do something about making sure 
the food supply is protected. FDA--and you don't have 
jurisdiction over FDA, so I am not asking you to comment on the 
FDA--but it has been reaction and not prevention, and 
prevention needs to be the order of the day.
    But if we do not do something other than increasing 
resources, which we have done with the FDA, but restructuring 
it in a way that puts food safety on its own, drug safety on 
its own, and make sure that there is an individual who is 
responsible for food safety, we are not going to get to where 
we want to go as the oversight of this effort, and we are not 
going to get to go where either FDA or you want to go at USDA 
on where we deal with food safety in this country.
    Secretary Vilsack. Madam Chairman, if I could react to 
that.
    Ms. DeLauro. Sure.
    Secretary Vilsack. First of all, I did not want to leave 
the impression with my answer that we don't understand the 
urgency of the circumstance. We certainly do. And the 
expectation, I think, that the President has is that we get to 
a set of recommendations in a very quick order.
    So, first and foremost, we do understand the urgency; and 
we are anxious to get to work. I am a little bit hampered 
because of the fact that two-thirds of the folks who are 
integral to this process have not yet been confirmed, and I 
have not had an opportunity to actually have conversations with 
them and feel it to be appropriate that in order for that 
working group to do its work well that we have a conversation, 
number one.
    Number two, there is no question that whatever system is 
ultimately devised has to be a system that provides for 
specific accountability. I would agree with you that when you 
have got 15 separate agencies in the Federal Government 
responsible for some part----
    Ms. DeLauro. No one is accountable.
    Secretary Vilsack [continuing]. You have got way too many, 
and it becomes very difficult for you or for a consumer or for 
a taxpayer to know precisely who to hold accountable when there 
is a problem, and we ought to be about accountability. So 
please understand I share that with you.
    And as far as reviewing the processes, we ought to be doing 
that as a matter of business. Every year we ought to be 
reviewing our processes to make sure that we are doing as good 
a job as we possibly can.
    So we would agree with you on that score as well; and we 
intend to be very aggressive on this, very, very aggressive, 
because we understand that people's lives are at stake.
    Ms. DeLauro. Thank you, Mr. Secretary.
    Mr. Kingston.
    Mr. Kingston. Thank you, Madam Chairman.
    Mr. Secretary, also, let me emphasize the frustration--as a 
committee member, so much of the discussion seems to be 
superficial.

                          FOOD-BORNE ILLNESSES

    For example, last week, we had a very good hearing on food 
safety, but one of the business association witnesses said to 
us that we should double the funding of the FDA. So I asked 
him, well, what was the funding increase last year? He didn't 
know, but he thought we should double it. Then he said he 
thought it was about $40 million. So I said, so we should 
double that to $80 million? He said yes. I said, well, are you 
aware that the actual increase last year, plus in the omnibus 
and in the stimulus, gave an increase of $300 million to the 
FDA? And he was not aware of that. And I asked him, do you 
still think we should double it? And he said yes.
    Well, I mean, that is kind of a silly discussion.
    Now, along with him at the table was an IG witness from 
HHS, and he actually had a figure of 300,000 people a year are 
hospitalized. Interestingly enough, I think the CDC uses 250; 
you just said 350.
    But I asked him, of those who were hospitalized, can you 
tell us what type food? Because, surely, there is a trend that 
meat may have more food-borne illnesses than fruit, for 
example. Maybe blended products have something. Maybe 
perishables will have more than nonperishable. Maybe there is 
an import issue.
    And the composition of the people who got ill, what age are 
they? Did the 5,000 who died, for example, did they have a pre-
existing illness unrelated yet something that would weaken 
their immune system?
    All these are relevant questions, and yet the IG had no 
idea of the breakdown of the 300,000 number.
    Are you aware of the breakdown of that number?
    Secretary Vilsack. I am not as I sit here today, 
Representative.
    Mr. Kingston. And I understand, because of what you were 
just saying, you don't have your key people right now in place.
    Secretary Vilsack. That is a fair observation, and it is 
also fair to say that there are many causes for food-borne 
illness which may not be necessarily related to how food is 
grown or is harvested or is processed. But there is still an 
issue here, and I think the American public is very concerned 
when they read about something as much of a staple as peanut 
butter is, that they can't basically trust their peanut butter 
source. I think that is basically a concern for folks.
    I mean, I have actually watched people in grocery stores 
hesitate at the aisle before they reach for peanut butter; and 
I have heard representatives from the peanut industry talk 
about the effect it has had on the peanut industry.
    So I understand what you are saying. I think we should make 
informed decisions, and we should have as much data as we 
possibly can to be able to determine what direction, where the 
resources need to be handled.
    But I do think, first and foremost, you have to have the 
right philosophy. And is the philosophy mitigation where 
basically a problem occurs and you try to contain it? Or is the 
philosophy we are going to try to do whatever we can to make 
sure that it is prevented by making sure that it is produced 
right, it is processed right, and it is also handled right and 
that consumers are well educated on precisely how to handle 
food.
    So this is not an easy issue. It is complicated, and your 
desire for more data is an appropriate one.
    Mr. Kingston. I think it is very important that we have 
good information that if there is a particular type of food 
that may have recurring problems and where is the breakdown, 
that is where we should start in order to be the most 
effective, to get the most bang for the buck initially.
    And the other part of it is the people who got ill, how 
much of that was because of something they did in the kitchen 
that had absolutely nothing to do with the process? And then we 
also know from CDC witnesses in the past that plays a major 
part of this discussion.
    Secretary Vilsack. It does, and I think it emphasizes the 
need for government agencies like USDA and FDA to do an 
increasingly vigilant job about educating consumers--and the 
food industry on educating consumers on precisely what they can 
and cannot, what they should and should not do.

                               PISTACHIOS

    Mr. Kingston. Do you know, by the way, how many people have 
gotten sick from pistachios?
    Secretary Vilsack. Today? I mean, in terms of the 
announcement today?
    Mr. Kingston. Yes.
    Secretary Vilsack. I don't believe any have. There is a 
concern that they may get sick, and so the recall has taken 
place.
    And, as the chairwoman suggested, it is sort of we are 
waiting to see.
    Mr. Kingston. Well, I read an article that said two people 
had actually gotten sick. But the reason why I say that, Madam 
Chairman--and I know you want to say something here, so----
    Ms. DeLauro. I am just saying it is an FDA issue. And I 
know we have got USDA here, but I would just tell you, you have 
read something that I haven't read.
    It said two people--it is a million pounds of pistachio 
products because of salmonella; and it says, so far, no 
illnesses have been tied to the contaminated pistachios, 
although authorities were investigating at least two consumer 
complaints. FDA warned consumers not to eat the pistachios 
until the scope of the contamination was clear. So hold on to 
the pistachios, but don't eat them.
    Mr. Kingston. Well, one of the things that I think is 
important in terms of the way the FDA has investigated food 
illnesses is to assume all the product is guilty. And, as we 
know, what happens as a result of that, people don't want to 
buy anything, and people deny themselves eating this product.
    Now, I am sure Mr. Farr knows more about pistachios than I 
do, but Mr. Bishop and I were involved more in the peanut 
situation, and peanuts are good nutritional products that 
people need to be eating for their own health. But when all 
peanut butter is considered to be taboo, then they don't eat 
it.
    And so there is--it is not just a commercial implication 
that, okay, the industry is losing millions of dollars because 
of FDA shot-gunning everything rather than lasering in on where 
the real problem is, but it denies the consumer the use of that 
product.
    The summer before it was tomatoes, which, certainly, 
tomatoes are a great part of your diet for daily consumption; 
and yet no one could eat tomatoes for 6 weeks or something.
    And so one of the things I think this committee is 
frustrated about is just the broad blanket that is thrown 
across a commodity when something happens.
    Secretary Vilsack. Well, it is a difficult circumstance, 
because people are really busy, and they are trying to take 
care of their children. And they come home, and they turn on 
the news, and they hear a report about a particular company and 
a particular product, and they may make an assumption about all 
of the products.
    And, you know, that is a difficult assumption to overcome. 
With time, we do overcome it. With time, markets are restored. 
But there is obviously pain and difficulty during that period 
of time.
    Again, I think if we create a prevention philosophy and if 
we focus on really identifying, as you suggested, with data 
where the risks are, making sure that we spend the time and 
resources to minimize those risks, we might be in a better 
situation to more specifically pinpoint the exact problem, be 
able to explain that to the consumer and make sure that they 
understand that it is this company as opposed to all companies.
    Mr. Kingston. I know I am out of time, but just to 
conclude, for example, the tragic death of the NFL football 
players off the coast of Florida while fishing the other day, 
represent a coastal area, the factors are so important. You had 
a small-craft advisory. You had an anchoring that was a wrong 
way to anchor the boat. There were a lot of mistakes that were 
made.
    So analyzing a problem is always very, very important; and 
I feel like in the USDA and FDA we are not analyzing this thing 
as much as we are just rattling the issue and, you know, all 
the good and the bad gets mixed in at once.
    So, thank you.
    Ms. DeLauro. Mr. Farr.
    Mr. Farr. Thank you very much, Madam Chair.
    Governor and Mr. Secretary, thank you for being here. I am 
very excited about your taking on this big responsibility.

                              FOOD RECALLS

    I just wanted to comment on Mr. Kingston's point that these 
markets don't always recover. I represent the spinach growers 
in Salinas Valley, specialty crops; and that product has never 
recovered from the recall.
    I think what, I think the confusion here that the Chair 
brought out is that, essentially, the warning goes out by FDA, 
but the impact of the recall is really on USDA.
    And I would hope, from your standpoint of being a Governor 
and doing emergency response, you have got to sit down with FDA 
and have them work on what I call crisis communication. You 
know, don't alarm the patient. At the same time, try to get the 
news out. Because some of these recalls just have consequences 
that are economically devastating. You just don't recover from 
it. And I think the FDA's, you know, broad brush yells fire. 
And I would hope that you might work on that.

                        CHILD NUTRITION PROGRAMS

    But I want to take time today, because I have been very 
interested in going out to schools in my area--there are a lot 
of poor children there--and dealing with the school lunch 
program, school food services. And what I have learned--I mean, 
one of your departments is Food and Nutrition Service, which 
is, frankly, one of the biggest users of the USDA dollars. It 
is a $62 billion department. It was created back in 1962. It is 
now 40 years old. It has got a 62--interesting, yes, $62 
billion--almost $1 billion a year.
    You have 15 separate nutrition assistance programs. Those 
are divided into five categories: food stamps; child nutrition; 
special supplemental, which is the WIC program; and the 
Commodity Assistance Program; and what they call nutrition 
administration, which is the Center for Nutrition Policy and 
Promotion.
    One of the big programs is child nutrition. In that, here 
is where you have been talking about wasteful spending. I hope 
you will turn your agency upside down to look at how you can 
better administer this. You would be amazed.
    This could be the same kid in the same school who qualifies 
for the school breakfast program, then has to qualify 
separately for a school lunch program, and then may also 
qualify for the child and adult-care food program and may 
qualify, if he is there, in the summer food program--which we 
have now been able to at least get the summer breakfast and the 
summer food program combined. But--guess what--we have a lot of 
schools that don't have summers anymore because they have year-
round schools. So there is confusion there. And then a special 
milk program.
    All of these are within--and we have to qualify them by 
verifying, one, that the parent is low-income, or, in some 
cases, you have some school breakfasts--I think it is more 
universal feeding.
    But the bureaucracy at the school level is just 
unbelievable and the cost of having to buy the computers to 
verify that each day that student came and ate the food and the 
food was nutritious.
    Now what happens is, because you have also got in that the 
commodity program, which is where we are getting our 
commodities sloughed off on schools. Now, a lot of schools 
don't have preparatory kitchens anymore. So they send--they 
don't want bags of wheat and rice sent to them. So what they do 
is they say we will work with the processors. And guess what 
the processors do? They add salt, and they add sugar, and they 
add other things.
    So now you have got processed food, and some of the inner-
city school districts get no fresh. They may get an apple and 
an orange, but you are not going to have a plate with fresh 
lettuce or any of those other kinds of things that are part of 
your nutrition advocacy. And I think it is terrific.
    But this program, if we just cleaned up the administration, 
for example, there is a pilot request of you to get a grant 
program to try out using the Medicare tapes in California to 
qualify the children. They have done this without--you know, 
done it on trial. They are finding they have more 
qualifications under that than they do trying to get the parent 
to verify.
    So I think the two things that you could do that would, 
one, save a lot of wasteful spending and allow you to spend 
more money on fresh fruits and vegetables and getting them into 
schools is just the administrative costs of combining those 
five programs, all the school programs. And one is 
consolidating them and administratively using technology to 
qualify the students.
    So the question is about will you do this? Nobody has taken 
it on. And at the school level it is a mess, and I would just 
like to see you committing to taking that on. We are going to 
reauthorize that bill this year, and it needs some leadership 
from the Department of Agriculture to take on the consolidation 
and simplification of the qualifications.
    Secretary Vilsack. Well, Representative, I think you make 
an excellent point. I think there is a need for greater 
efficiency within this program so that schools are spending 
less time on paperwork and more time on teaching our children 
and making sure that they have access to quality meals and 
making sure that they have appropriate physical activity to 
keep them active.
    I think that is important, and I think it is also important 
for us to address the concerns that Representative Kingston 
alluded to earlier, which is to make sure that, as we do these 
programs, that we are conscious of making sure that we do them 
properly and that there aren't erroneous payments. It is a 
combination of both of those.
    Ms. DeLauro. But that process of erroneous payments, I 
mean, if you use these Medicare tapes and food stamp tapes, 
they are automatically qualified.
    Secretary Vilsack. I am agreeing with you. I am just simply 
saying that it is important for us to keep both of those 
concepts in mind, and I can assure you that we are working on 
programs similar to what you have outlined to propose and 
suggest in the reauthorization.
    Mr. Farr. And will we see these grants awarded soon, I 
mean, the applications for these pilot programs?
    Secretary Vilsack. We have been focusing on trying to get 
the under secretaries in place. We are trying to work 
expeditiously. We are trying to make sure that what we do is 
all coordinated in terms of the reauthorization so that we have 
a consistent plan. So we are working as hard as we possibly 
can, as quickly as we can, to get money in place.
    We are also trying to put money out in terms of equipment. 
You mentioned the issue of school equipment. We appreciate the 
money that was put in the Recovery and Reinvestment Act. We are 
trying to get those grants out as quickly as we can as well so 
that schools aren't actually in a process to cook them and to 
process the food, requiring some processor to put sugar and 
salt in it, as you suggested.
    Mr. Farr. Thank you.
    Ms. DeLauro. Thank you, Mr. Farr.
    I just--to support something that Mr. Farr was talking 
about, it is interesting--last year, FNS testified payment 
accuracy rates for food stamps had improved steadily over 8 
years and were at near record-high levels.
    I was going to mention this a little later on, which we 
will talk about a little later on. I don't know how we can say 
that the same about farm payments, but we certainly are down 
pretty low in terms of the food stamp program.
    Mr. Latham.

                             FARM PAYMENTS

    Mr. Latham. Thank you, Madam Chairman. And I wanted to 
continue the discussion about food and food safety, but you 
brought up farm payments, so I will do that.
    I am sure you have heard, and I certainly have, a lot of 
concern in farm country about some of the proposals. I would 
like to know the rationale, I guess, for the $500,000 gross 
sales, doing away with direct payments, and the $250,000 
payment limitation. I have heard not only from constituents out 
there, but also certainly here talking to my colleagues on both 
sides of the aisle, that no one wants to open up the farm bill 
again to make those kind of changes. I think the Senate Budget 
Committee took a vote, and it was taken down. How do you 
respond to the proposals?
    And just as one other issue involved with the payment 
issue, there is a new requirement--I guess it is not required 
technically--to sign a statement that you will release the 
records from the IRS to USDA to be eligible for payment. You 
don't have to do it, but then you don't get payments unless you 
do it.
    Anyone around here, I think, has, over the years--maybe 
doesn't have total confidence in the integrity of some of the 
systems as far as protecting that very important personal 
information, but I just want to know your response to those 
things.
    Secretary Vilsack. Well, first of all, let me talk a little 
bit about the budget and try to respond to your question of why 
we set it up the way we did.
    We recognized that the President had some very specific 
priorities that he wanted to see reflected in his USDA budget. 
Priority number one was an increased resource in child 
nutrition, to make sure that our youngsters had access to 
fruits and vegetables and more nutritious food. He also had as 
a priority expanding renewable energy opportunities as an 
economic development tool for rural America.
    Recognizing that those were significant increases in the 
budget, we looked for things that we could point to that would 
allow us to also keep in mind the need to be more fiscally 
responsible over the course of time to make sure that we 
returned to a time when we weren't dealing with trillion-dollar 
deficits. If there is one distinction between where we are 
today and where we were when we were debating the farm bill, it 
is that, we are in an economic circumstance and situation where 
we are faced with very, very substantial deficits over time, 
and we have to control them in some way.
    There are many ways to do that, and I am sure that Congress 
is considering many ways, and they will obviously make their 
choices. We decided to focus on the top 3 to 4 percent of 
producers who are in that category of more than $500,000 in 
sales, representing roughly 90,000 producers of the 2.2 million 
farmers and ranchers. We kept in place all of the other safety 
net programs, the countercyclical program, the ACRE program, 
the SURE program. All those programs were obviously still 
available to those individuals, and we phased it over a 3-year 
period. So it involved a very small percentage of farmers, but 
those farmers were receiving about, as we calculated, roughly 
30 percent of the direct payments. The other farmers would 
still be able to get their direct payments and still qualify.
    It is a choice. Obviously, as you all take a look at that 
notion of fiscal responsibility and maintaining some degree of 
responsibility, you are going to have to make choices. Well, 
that is a choice we made, and that is basically the philosophy 
behind it and the reason why we proposed it, as we did with 
others.
    As it relates to the IRS, it seems to me that we have a 
responsibility to taxpayers and to Congress to make sure that 
the programs that you all pass are administered as well as they 
can be administered. And we have to accept accountability and 
responsibility when we administer them in a way where people 
get payments that they are not entitled to receive.
    If the farm bill restrictions that are currently in place 
referencing direct payment limits, countercyclical payment 
limits, overall limits, if they were in place today, that 
number of 40-some million would actually be closer to $90 
million in overpayments. So in an effort to try to make sure 
that we corrected that circumstance, we are simply asking 
farmers to give us the ability to check with the Internal 
Revenue Service.
    It is not a matter of having tax returns at the local FSA 
office; that is not the way it is going to happen. It is going 
to be a relatively small--very, very small--percentage of 
farmers who will be checked periodically to make sure that we 
are doing a better job of making sure that payments that are 
supposed to be received by folks are getting to the folks who 
are supposed to get them. It is a matter of accountability.
    Mr. Latham. I would reiterate that people are very, very 
concerned about privacy, and that USDA's track record as far as 
information technology and being able to keep anything is 
mixed, to say the least.
    Secretary Vilsack. That is a fair observation. We will take 
that back, and we will try to make sure that we address those 
concerns. But at some point in time you have to make sure that 
the payments are getting to people who are entitled to them and 
not to people who aren't. And for the most part, we are not 
talking about farmers getting these payments, we are talking 
about folks who really aren't on the farm getting payments.
    Mr. Latham. Thank you, Madam Chair.
    Ms. DeLauro. I would just add to that, if I could, Mr. 
Latham, that the GAO report found that because USDA did not 
have the ability to verify income, the Department paid more 
than $49 million to ineligible wealthy farmers and landowners.
    Further, assuming that we might have a question in this 
area with regard to the IRS, I checked with the Ways and Means 
Committee, and it would appear that there are many programs, 
from food stamps on up, that receive information from the IRS. 
So there really is a whole lot of precedent in this area in a 
whole variety of programs that have to supply some of this 
information. This is not a new incarnation and a group of 
people who would be subject to something for the first time.
    Mr. Bishop.
    Mr. Bishop. Thank you very much.

                          CIVIL RIGHTS ACTIONS

    Welcome, Mr. Secretary. And let me just take this 
opportunity to congratulate you on your hitting the ground 
running. And particularly, let me just first comment on the 
frank and forthright way that you have addressed the civil 
rights issue. I think that speaks highly of you, of the tenor 
of your character in dealing with a problem that has been 
systemic and has aggravated the image and the functioning of 
the Department for years and years and years. So I want to 
congratulate you on that.
    I also congratulate you on the selection of Dr. Joe Leonard 
as the proposed Assistant Secretary of Civil Rights. I think he 
has a strong background, and I think he will certainly be able 
to be quite helpful in that capacity.

                       RURAL AMERICA INITIATIVES

    I have got three areas of concern that I want to mention. 
The first has to do with rural America. Through your testimony 
it is very clear that through the stimulus bill, the farm bill, 
and your budget proposals, that this administration is going to 
place a great deal of emphasis on rural America. And we are 
very, very delightful that you are taking and the 
administration is taking that focus.
    I represent a congressional district that has 32 mostly 
rural counties, 29 of the 32, and, of course, more than half of 
the counties in my district are classified as persistent 
poverty counties. Representative Emerson has, I think, a very 
similar district, and I think she has taken a lot of 
initiatives in rural poverty.
    I want to just elevate the issue. And, of course, in the 
budget and the stimulus and the farm bill, you emphasize 
broadband and working with the Commerce Department; $20 billion 
in loans, loan guarantees, grants; homeownership for rural 
America, which is great; creating jobs, 165,000; and, of 
course, 280 families that are impacted by rental housing. You 
emphasize infrastructure with water treatment, waste disposal, 
rural research; an extension with the minority-serving 
institutions; and the microentrepreneur assistance programs, 
with grants to nonprofits for technical assistance, and loans 
of up to $50,000 for small businesses in rural areas. All of 
that is great.
    Do you think that it would be helpful, particularly given 
the economic crisis that we are in, to have the administration 
have some White House initiatives on rural America regionally 
across the country so that this can be lifted up and given a 
higher profile, and rural communities can see that there is, in 
fact, an outreach, and there will be a hand up for rural 
economic development in these communities? Because it cuts 
across every aspect of life, and it also will help to make 
these rural communities competitive in the global marketplace 
from where they are. And you can respond to that.

                    PEANUT AND COTTON LOAN PROGRAMS

    My other two questions are more technical. They have to do 
with--of course, you know, I represent a peanut district, I 
represent cotton, and, of course, your budget reflects some 
concerns for us, particularly with regard to peanuts.
    Let me just say quickly, you mentioned dairy, involving 
dairy in the nutrition programs. Peanuts are suffering 
tremendously, and so I would hope that you would consider 
utilization of peanuts in the nutrition programs also to help 
in the recovery as a result of the unfortunate situation that 
has happened with our industry.
    But with regard to peanuts and cotton, the market and loan 
program has presented a serious problem. In the 2008 farm bill, 
the market and loan program was continued for peanuts as well 
as for cotton, but the method by which the loan repayment rate 
has been devised is sort of a mystery. It has been set too high 
to allow peanuts to be competitive in regard to the world 
market. And with regard to cotton, the market and loan program 
has been administered in a way in the past that ensured that 
cotton would be competitive, but now in your budget you 
indicate that you are going to terminate the storage credits 
that are included with the market and loan for cotton. And, of 
course, that is going to be very disruptive to marketing and 
income for farmers.
    Can you explain the impact? Do you understand the impact 
that both of these will have on farm-producing income and on 
marketing?
    Secretary Vilsack. Representative, in terms of the White 
House initiative, let me just briefly respond to that. I think 
that there is no question that we will continue to do a job of 
making sure that folks in rural America understand and 
appreciate the wide variety of programs that are available. I 
just this week have talked to a group of community economic 
development folks about the various programs that are 
available. Sometimes people don't know the breadth of what USDA 
does, and we need to do a better job of educating people about 
precisely how we can address housing needs, multiple-family 
housing, economic development. We are taking a look at how we 
administer our business and industry loan programs to make sure 
that we focus on quality jobs and make sure that they are jobs 
that actually improve the overall well-being of the 
communities. The use of the Community Facilities grant money is 
another opportunity for us to send a very strong, positive 
message.
    So I think you will continue to see leadership from the 
White House addressing the needs of rural Americans 
specifically, highlighting some of the things that are being 
done in the Recovery and Reinvestment Act specifically as it 
relates to that.
    With reference to peanuts, we are monitoring the 
circumstances and situation with peanuts, and we are watching 
it very closely. We haven't seen quite the market disruption 
that we saw with dairy. Dairy was rather dramatic and rather 
severe and very significant. But we are monitoring that 
circumstance, and, as conditions merit, we will certainly take 
action that is appropriate.
    With reference to the cotton storage issue, peanuts and 
cotton are the only two products that actually get this 
treatment; peanuts, of course, through the Commodity Credit 
Corporation. Cotton would then be the only one through the 
traditional budget process. Our view is that, to a certain 
extent, it could potentially distort the market in terms of 
providing some incentive for storage when perhaps it would be 
more appropriate not to store it.
    Again, this is about choices and priorities. The President 
was very clear about what his priorities were, and we obviously 
have a mind towards long-term budget impacts.
    Mr. Bishop. May I make just one statement, Madam Chair?
    Ms. DeLauro. Yes.
    Mr. Bishop. We worked so hard in the farm bill to try to 
get that done, and now it seems like we are undoing all of our 
work that was put in the farm bill. And, of course, that was a 
very sensitive issue in the farm bill, and, of course, it is 
very sensitive now for both peanuts and cotton.
    Ms. DeLauro. We will have another round.
    Mrs. Emerson.
    Mrs. Emerson. Welcome, Mr. Secretary. Thanks so much for 
being here.
    I have so many questions, I really don't know where to 
begin, so I will just go through your testimony here and start 
from there.

                            RURAL BROADBAND

    I am really interested how RUS is going to work with the 
NTIA to deploy all of the stimulus money for purposes of rural 
broadband. For example, I have got small companies who have 
applied to RUS, who, of course, say that they can't really make 
any decisions unless you are the one who makes the decision 
because there is not a political appointee yet at RUS. And so 
we have got lots of applications waiting there already. And 
then I talked to the NTIA guys, and I wasn't really comfortable 
with the coordination that was going to occur between the two 
agencies. Perhaps you can enlighten us a little bit, please.
    Secretary Vilsack. Well, we have made a recommendation for 
our RUS Administrator, Mr. Adelstein, who has actually been 
serving on the FCC and has some telecommunications background. 
So we hope that that process moves forward and we are in a 
position to get him working as quickly as possible.
    I would say that, first and foremost, our focus is going to 
be on the unserved areas. We appreciate the fact that monies 
have been provided to RUS in the past for this, and that 
perhaps they have gone in places where it was about increasing 
competition and lowering cost as opposed to expanding access. 
We are looking at creative ways to make the case in these 
unserved areas that, with these resources, with grants and 
loans, we can actually expand access, and that is going to be 
the measure by which we determine the success or lack of 
success of this program.
    But we have had a series of public hearings. We are getting 
input from folks in terms of how they believe it ought to be 
structured, but our focus primarily is going to be on the 
unserved areas, as defined as population centers of 20,000 or 
less, and metropolitan areas of 50,000 or less, that are 
currently unserved by this technology.
    This is a very, very important technology. As Governor of 
Iowa, we made a very aggressive effort to try to make sure our 
rural communities were linked to this for a multitude of 
reasons. One, if you are a small business person, it opens up 
markets beyond your local markets. Two, if you are a farmer or 
a rancher, it allows you to get up-to-date information to 
better inform decisions that you have to make about what you 
are going to plant, when you are going to plant it, and so 
forth, and when you are going to sell your crop or your 
livestock. Those are very important considerations if you don't 
have access to that information.
    And third, we want to make USDA services as convenient as 
possible. That is difficult to do for farmers and ranchers who 
don't have the technology and the farm service agencies who 
don't have the technology to create better cooperation.
    Mrs. Emerson. Well, hopefully all the money that you have 
gotten between the omnibus and the stimulus will allow your 
computer systems to finally start working, because in my 
district--and as Sanford Bishop so eloquently said, a majority 
of my district is persistent poverty. And we don't have 
broadband in an awful lot of places, but also, where we do have 
it, even my farmers and ranchers who have to deal with FSA or 
NRCS, there are certain times in the afternoon when they either 
can or cannot access the system. I mean, this is a subject that 
we have been talking about--it was not one of my questions, but 
I can't resist at least raising it.
    Secretary Vilsack. Well, we will certainly begin the 
process with the resources that this committee fought for and 
got for us in the Recovery and Reinvestment Act. I don't want 
this committee to believe that that is all that we need in 
order to actually modernize the system. It will take more time 
and more resources, but it is something we need to focus on.
    One other thing in terms of your question, we are meeting 
on a regular basis with NTIA, and we are also intending to have 
sort of a joint application and a coordinated process. So I 
think you will see coordination with reference to these issues.
    Mrs. Emerson. That is good. That is going to be very 
helpful, I think.

                       DEVELOPING ENERGY MARKETS

    Let me ask you another question. I was reading your 
testimony last night, and you talk about developing markets 
that will reward producers for sequestering carbon and limiting 
greenhouse gas emissions. And they will then facilitate the 
participation of farmers, ranchers and forest landowners in the 
emerging environmental services markets.
    Here is something that is very worrisome to me with regard 
to the whole cap-and-trade, greenhouse gas, climate change 
debate. And it is not that I am not in favor of doing 
everything that we can to sequester carbon and the like, but 
during the negotiations on the Kyoto Protocol, both in Kyoto 
and in Buenos Aires, Argentina, when the United States tried to 
get a one-for-one credit, if you will, for farmland, as well as 
for forestry, we were totally rebuffed at every step of the 
way. And this is during the Clinton administration. I was at 
those negotiations.
    And so, anyway, it worries me that we try to create these 
markets and make promises, but yet, in the international arena, 
if you will, we aren't going to be able to get, as a carbon 
sync or a credit for our farmland and/or forests, the 
appropriate cost factor, and so it is going to end up 
penalizing our farmers.
    I am out of time, so maybe we ought to come back to that, 
Rosa, do you think?
    Ms. DeLauro. Why don't you respond briefly.
    Secretary Vilsack. I will try to briefly respond to it. I 
think that we--``we'' meaning the collective ``we,'' globally--
continue to learn more and more about how these markets will be 
set up and structured. I see this as a great transition taking 
place in this country from an economy that was focused on waste 
and pollution to an economy that is focused on clean energy and 
clean jobs. I think agriculture needs to be part of that, and I 
think it needs to be an integral part of it.
    We are a relatively small part of the greenhouse gases that 
are being placed into the atmosphere, but I think we can be a 
huge part of the solution. And as we structure and as we create 
these new systems in this transition, I want to make sure 
agriculture is at the table, and I want to make sure that they 
understand that--I believe there will be benefits, there will 
be offsets, there will be ways in which we can reward farmers 
for doing the right thing with their land for themselves and 
for all of us.
    Mrs. Emerson. Okay. We will come back to this later. 
Thanks.
    Ms. DeLauro. Thank you.
    I just want to support Mrs. Emerson in the notion that we 
should not let NTIA slow down the RUS in terms of those 
applications, Mr. Secretary. We need to move quickly in trying 
to deal with those underserved areas.
    Secretary Vilsack. Our hope is that we have three rounds of 
awards starting this spring.
    Ms. DeLauro. You have got a program; they don't.
    Mr. Jackson.
    Mr. Jackson. Thank you, Madam Chair. And I just want to 
make an observation before I ask Secretary Vilsack a couple of 
questions.
    I have noticed that most of the questions from today's 
panelists and Members have come after the red light has come 
on. I am assuming that there is great leniency with the gavel--
--
    Ms. DeLauro. There is always leniency in this committee 
because it is about a discussion; but nevertheless, let us try 
to get the questions in before the red light goes on.
    Mr. Jackson. I appreciate that, Madam Chairman.

                          SCHOOL LUNCH PROGRAM

    Mr. Secretary, I represent a congressional district, parts 
of which were formerly represented by State senator Barack 
Obama, and then United States Senator Barack Obama, and 
obviously President Barack Obama. I want to, first and 
foremost, be the first member of this committee to invite you 
to come to my congressional district to have lunch with me, 
along with Mr. Steele, at a couple of high schools very 
familiar to the President and elementary schools familiar to 
the President, to have lunch and experience what those kids are 
eating, and then, at the appropriate time, make a judgment, 
hopefully, in your office to determine whether or not you think 
that the meals that they are being fed in the school lunch 
programs are sufficient to provide them the kind of nourishment 
necessary to survive during the regular academic day.
    So I would appreciate it if you would, one, be willing to 
accept lunch with me in my congressional district. I believe en 
route to Iowa you have got to stop through Chicago--I know it 
can be very challenging. Would you be willing to accept it?
    Secretary Vilsack. Congressman, I would be happy to spend 
time with you at the schools that you have mentioned. I would 
just parenthetically say that my wife taught school for 30 
years, and as a Governor I went to many, many, many schools and 
had school lunch, so I am a little familiar with what you are 
talking about.
    Mr. Jackson. I am sure you are, Mr. Secretary. But as 
Secretary, and given the President's experienced as a community 
organizer and what he has written about ad nauseam, quite 
frankly, the number of times that he has experienced many of 
the poverty central districts that many of the members of this 
committee represent, the President has suggested that it was 
these schools, these community events that helped draw him to 
public service in the first place.
    You mentioned in our opening remarks that, for you, the 
President's budget meets the test of addressing many of these 
fundamental priorities. And for me, as someone who still 
represents the people that State senator Barack Obama 
represented and then U.S. Senator Barack Obama, the test is met 
when their lunch programs change, when students eat something 
different than what they are eating.
    I appreciate the efforts that you have advanced in the 
Department with respect to civil rights, and I applaud you in 
that area, but I am also going to make the case for the next 
couple of years that we extend civil rights to students and the 
school lunch program. And towards that end--and I am not being 
cavalier with this--I think it important that maybe Agriculture 
Department-wide, that, given that there is a cafeteria in the 
Department of Agriculture, that maybe the special on any given 
day at the Department of Agriculture for lunch, since we 
believe in leadership by example, ought to be some school lunch 
that is being served somewhere in the United States, paid for 
by the Department of Agriculture.
    Let us go one step further, not just a special, with the 
options being you can try and eat what they are eating in 
School District 147 in Harvey, Illinois; bypass the special and 
then eat spaghetti, meatballs or salad bar, or whatever else is 
being offered at the Department of Agriculture. Maybe the 
special should be what they are eating in School District 147 
in Harvey, Illinois, and the other options be what is being 
offered in other school districts around the country so that 
the Department itself is sensitive to the idea that when the 
standard of what is being fed to Department members within our 
own government changes, then the same standard is being changed 
in the school districts around the country who are experiencing 
the exact same quality of food.
    Now, for me, the budget test, which Mr. Steele is obviously 
here to advance before this committee, is whether or not, after 
we spend the stimulus money and after we spend and advance the 
agricultural appropriations requested by Mr. Steele, whether or 
not in the stomach of some child in some urban area or some 
rural area there is a qualitative and a quantitative difference 
in the quality of nutrition that they are experiencing. If 
there isn't one, then we are wasting money. There is no change.
    It appears to me that the only way to truly be able to 
judge that is if the Secretary of Agriculture--obviously no 
longer Governor, but Secretary of Agriculture--is willing to 
make the statement that policy at Agriculture Department-Wide, 
we are going to lead by example; that whatever it is that 
students across this country are experiencing in their student 
lunch programs or in their breakfast programs, we, too, will 
experience it at the Department of Agriculture.
    Is the Secretary and/or members of his staff willing to 
make that adjustment and extend that civil right to students 
across the country?

               SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM

    Secretary Vilsack. Well, Representative Jackson, thank you 
very much for, obviously, the deep passion that you have for 
the children of your district and the children of all school 
districts.
    Let me say that I think we are making some steps along the 
lines that you have outlined. I point to the WIC program and 
the fact that we did an evaluation of that program, looking at 
the dietary guidelines, and as a result of that evaluation, the 
packages that will go out to women and children under the WIC 
program this fall will be different and will be more 
nutritious, will have more fruits and vegetables.
    We have made an effort to try to expand opportunity for 
people with SNAP to be able to access farmers markets through 
the electronic benefit transfer card, the EBT being essentially 
available at farmers markets, and we are going to continue to 
promote access.
    We have a similar evaluation taking place with reference to 
school lunches. The Institute of Medicine is currently doing an 
evaluation. It has been a 2-year study of the quality and 
nutritional value of those meals. We expect that they will be 
making recommendations at the end of this year.
    One of the reasons why we asked for additional resources in 
the budget was to make sure that we began the process of 
building on what was done in the farm bill, creating more 
opportunities for fruits and vegetables to be in those meals.
    We are, I would say, in a slightly different way leading by 
example. It was USDA, with the People's Garden, which was one 
of the first things we did, jackhammering up asphalt and 
planting an organic garden outside the very office of USDA in 
honor of President Lincoln's 200th birthday. We are going to 
have People's Gardens all across the United States and 
hopefully all across the world at USDA locations. This garden 
in particular is organic. It is going to be tended by people 
with disabilities and by USDA workers on a volunteer basis. The 
produce from that garden is going to be given to local food 
banks. So we are leading by example.
    Mr. Jackson. I just want to be clear, I don't think we need 
another study, Mr. Secretary, at IOM. I just want to be clear. 
I am not being combative at all. I just want to be clear that I 
don't think we need another study. Whatever it is that we are 
eating in the cafeteria at the Department of Agriculture ought 
to be the exact same thing that we are serving to students 
across our country in school districts. That is all.
    Secretary Vilsack. Well, the study is designed to make sure 
that the meals are consistent with the dietary guidelines. 
While we may not need another study, the reality is that they 
have not been consistent with those dietary guidelines, and 
they need to be. We have 36 percent of our children today who 
are faced with the possibility of being overweight or being 
obese, and that is a health care issue and a health care crisis 
that needs to be addressed. And on the other side, we have 
children who don't get enough food, who are hungry. Those need 
to be addressed.
    And the way we can help address both of those problems is 
by making sure that the meals that we serve, whether it is 
breakfast, whether it is lunch or snacks, are consistent with 
those dietary guidelines so that youngsters get a balanced, 
nutritious meal. That is what our goal is. And that is what we 
are aiming to do with the budget we proposed. That is what the 
President has instructed me to do, and I take that very, very 
seriously. 
    Mr. Jackson. Thank you, Madam Chairman.
    Ms. DeLauro. Thank you, Mr. Jackson.
    I will just make a point, and then I want to make an 
announcement here.

                           DIETARY GUIDELINES

    On the dietary guidelines, Mr. Secretary, Acting Under 
Secretary O'Connor was here last week. He did say that once the 
IOM made recommendations, it could take an additional 3 years.
    One of the questions I was going to ask--and Mr. Jackson is 
absolutely right--and others here were at this nutrition 
hearing where we spent a fair amount of time--this is 
intolerable. We will not take another 3 years for a rulemaking 
process for the implementation of revised nutrition standards 
and meal requirements for school lunch and for school 
breakfast, because the issue is correct, we cannot wait that 
long.
    One of my questions to you is going to be how do we cut 
through this and get to a rule as quickly as we can on these 
guidelines, in addition to which is coming out in October, you 
have got the WIC reauthorization coming up in September. We 
need to have some information in order to move forward on these 
things here, and we have got to move fast.
    Secretary Vilsack. The answer to your question, how do you 
cut through it, is by the Secretary basically saying, ``Cut 
through it.''
    Ms. DeLauro. Thank you. And this is what we anticipate from 
you, Mr. Secretary.
    I am going to say this, and I have to, you know: Physician, 
heal thyself. We have to hold to the 5-minute rule. We really 
do. I am going to be there, I promise, but the Secretary's time 
is limited, and my colleagues on both sides of the aisle need 
to get in their questions. And I have three additional Members 
on our side of the aisle for the opening round.
    Mr. Davis, why don't you move forward. Then Mr. Hinchey, 
Ms. Kaptur. And we are going to hold strict to the 5-minute 
rule here.
    Mr. Davis. Madam Chair, thanks very much.

                          SMALL FARM PRODUCERS

    I want to identify first the district I represent so you 
will understand from which the questions come.
    We have 435 congressional districts in this country. That 
is a history lesson you probably don't need. But my district 
has the fourth largest rural residential congressional of those 
435, has the third highest number of low blue-collar wage 
earners. Less than 60 percent of the people live in a household 
where they earn less than $40,000 a year; 109,000 households 
earn less than $25,000 a year.
    I visited a school recently where the nutrition director 
said on Monday mornings there are times when children get off 
the bus and don't say hello to anyone, and they run directly to 
the kitchen where they get their first meal that they have had 
since they left on Friday.
    We do have problems in the district I represent and across 
this Nation that we all need to address collectively. I am 
excited as I read about rural America and how some of the 
forefathers, some of those who worked through the 1920s, I 
think, with perhaps some mistakes, but through the 1930s to 
build an infrastructure in this Nation that rural America would 
continue to be able to participate and keep farmers on the farm 
or at least agricultural land in production to where the 
cheapest food supply and the safest in the world came from 
America.
    And I look at the infrastructure, starting with some of the 
conservation, the Soil Conservation Service, the extension 
services, the old Farmers Home Administration, ASCS, now called 
Farmer Service Agency, the combining of many of those, the 
Rural Credit, the technical assistance, the encouragement, the 
farmer-to-market roads. And then we got telephone co-ops that 
connected us with the world. And then we actually got power 
lines first. I can remember when they came through the little 
valley I lived in.
    And so, we have an infrastructure there that perhaps no 
other country in the world has. Most of those are nonprofits; 
most of those are owned by those that are served by the service 
they provide. And we had an opportunity also, through tax laws, 
to establish our cooperative system where feed, seed and 
fertilizer became available at a lower price, and we had a 
place to market our products.
    So we have that unbelievable infrastructure, the farmer-to-
market roads, that connects us to the interstate systems that 
were built in the 1950s. And as a result, we have become the 
most productive, per person, of any other country on the face 
of this planet. Seven billion people today live in this world. 
More people live today than have ever lived. If you combine the 
totals of everyone, except today's population, we have more 
people living than have ever lived on the face of this Earth. 
Our farmers need to be sure that we can continue to supply the 
food not just for America but for the rest of the world as 
well. And through that infrastructure, we can do that.
    I have observed, as I have read the history of Henry 
Wallace--not the first, the son, Henry Wallace--as he brought 
to this Nation an agriculture policy that talked about 
conservation, allotments, and acreage. In essence, we were only 
going to grow basically what we needed, and we would keep those 
farmers in operation. We didn't give the huge subsidies. Now, 
we have drifted away from conservation, and we have drifted 
away from marginal production to where, today, overproduction 
gets us in trouble with the WTO and others as well, when we 
start subsidizing.
    So I am getting into a philosophy that I don't have time to 
discuss with you, but I do believe that we have got to go back 
and take a serious look at our ag policy that dramatically 
changed in the 1990s and continued through 2002, and then again 
in 2007 as we wrote the farm bill.

                            502 DIRECT LOANS

    There are two areas where I think we may not be funding as 
adequately as we should. The old Farmers Home Administration 
had what they called 502 direct loans. I am all for modular 
housing, but in the district I represent, the only option that 
many low-income individuals who live in those households where 
all the folks working earn less than $25,000 a year, 109,000 
households, don't have a source of credit. Are you willing to 
work on increasing additional funding for individual housing 
and establishing greater credit for some low-income individuals 
who have no source to go to today?
    Secretary Vilsack. Well, there are so many things that I 
would like to be able to say in response to the preface to that 
question. But in terms of the nature of farming today and what 
is happening particularly for small producers, which I think 
creates an opportunity to do what you would like to see 
happen--let me say that we were pleased with the Recovery and 
Reinvestment Act because it gave us the opportunity, with 
additional resources, to address a rather significant backlog 
that existed in those 502 loans. In fact, we were able and will 
be able with the recovery resources to basically reduce that 
backlog by 10,000.
    Mr. Davis. And I hate to interrupt you, but 502 had an 
interest credit which reduced interest down to 1 percent. Many 
folks, as their income increased, eventually started paying the 
full interest rate.

                   RURAL WATER AND WASTEWATER SYSTEMS

    And the second question, I am extremely interested as well 
in looking at the dollars that are made available for our water 
and wastewater systems in rural America, especially rural 
Fourth Congressional District. I want to work with you some on 
each of those two issues.
    My time is in yellow, so I am going to adhere to the 24 
seconds I have left to say thank you for coming and for being 
here to answer questions. I will write you the questions that I 
have and ask you to give an answer.
    Secretary Vilsack. Five hundred and forty million dollars 
has already been used to fund over 400 projects in 43 States on 
wastewater, and we expect more to come in the next several 
months.
    Mr. Davis. Thank you, sir.
    Ms. DeLauro. Mr. Kingston.
    Mr. Kingston. Thank you, Madam Chair.
    Mr. Steele, I want to put a little focus on you for a 
second.

                 ELIMINATION OF CONGRESSIONAL EARMARKS

    In the statement of the Secretary, it says that the budget 
reflects the elimination of earmarks. And I was wondering how 
much money that saved.
    Mr. Steele. I think it is around $600 million, $600 to $700 
million of earmarks, mainly in CSREES. There are some in NRCS, 
a few in a few other agencies, but the bulk of it is in the 
research area.
    Mr. Kingston. Were those congressional earmarks or 
Administration earmarks also?
    Mr. Steele. No, those are congressional earmarks.
    Mr. Kingston. So the third branch of government, the equal 
branch, eliminated congressional earmarks, legislative, but not 
executive earmarks. I just want to make sure of that.
    Mr. Steele. It is a choice that the Secretary----
    Mr. Kingston. It is a choice of the Secretary? I wanted to 
find out. It sounds like the legislative branch has the only 
earmark issue.
    Mr. Steele. It is a traditional action on the part of the 
Administration normally to eliminate earmarks. It is not a new 
policy.

                           USER FEE PROPOSALS

    Mr. Kingston. There is another traditional action, which is 
to increase veterinarian fees and put food-processing fees 
knowing that the legislative branch isn't going to go along 
with that, but in order to make the budget look better from the 
executive level. Was that practice followed also?
    Mr. Steele. Yes. There are a few user-fee proposals in the 
budget. As we have in the past years, we have a small user fee 
for the Food Safety Inspection Service; a reinspection fee of 
$4 million is put in.
    Mr. Kingston. How much was that?
    Mr. Steele. It is $4 million. It is a fairly small fee, 
but----
    Mr. Kingston. No. How much is the total of the user fee?
    Mr. Steele. Total user fee is--well, it varies, obviously. 
Some APHIS user fees would be $20 million in 2010. Roughly 
these would be for----
    Mr. Kingston. I will tell you, if you could submit those 
fees for the record.
    [The information follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Kingston. Are you optimistic that Congress is going to 
go along with those? Never mind.

                 ELIMINATION OF LOWER PRIORITY PROGRAMS

    In terms of the funding for the elimination of programs 
that are not a high priority, do you have a list of those?
    Mr. Steele. We do.
    Mr. Kingston. Do you know of any them offhand?
    Mr. Steele. One is the RC&D program, which is eliminated 
for funding around $50 million in the budget. There have been 
some other reductions in other programs, but those will be more 
identified when we submit our budget in May. When the full 
budget is submitted to Congress, then those programs will be 
identified more specifically. But the one identified so far is 
the RC&D program.
    Mr. Kingston. Well, I would certainly be interested in 
working with you on that. So if you could send me a copy, your 
answer, and then submit some for the record as well. But I 
would like to look at those to see which ones we can work with 
you on.
    [The information follows:]

          Programs Proposed for Termination in the 2010 Budget

    Information for the 2010 budget is being finalized for a detailed 
budget release later this spring. A list will be provided to Committee 
staff at that time.

                      FNS ERRONEOUS PAYMENTS STUDY

    Mr. Kingston. Are you familiar with the FNS study on the 
school lunch program that revealed that $860 million of the 
funds spent in 2005 and 2006 were improperly paid?
    Mr. Steele. I am familiar with the study, yes.
    Mr. Kingston. That was an FNS study.
    Mr. Steele. I am not sure exactly who the author of the 
study was, whether they had it contracted, or whether they did 
it themselves.
    Mr. Kingston. But it was a legitimate study, not by an 
outside group.
    Mr. Steele. I would have to check and double check and 
provide the answer for the record.
    [The information follows:]

    The following study on the amounts and rates of erroneous payments 
in the National School Lunch Program (NSLP) and the School Breakfast 
Program (SBP) was conducted by Mathematical Policy Research, Inc. for 
the Food and Nutrition Service.
    The study can be found at http://www.fns.usda.gov/ora/menu/
Published/CNP/FILES/apecvol1.pdf.

    Mr. Kingston. To your knowledge, what has been done to 
recoup the $860 million that was overpaid?
    Mr. Steele. Well, I think it is part of the error rate 
problem in terms of providing food--are you talking about 
school lunch or food stamps?
    Mr. Kingston. School lunch. And if I could, let me ask the 
Secretary, because you are just getting settled in here, but 
this was an FNS study--an audit, actually--that said that the 
school lunch program overpaid $860 million. We had mentioned 
the study before, which Mr. Steele just alluded to, that food 
stamp overpayment was $1.29 billion. And then I mentioned 
before, as did the Chair, about the $49 million overpaid on 
farm programs because of ineligibility. So those are three 
sources of huge money, if we can work with you on it.
    Will you be formulating a plan to go after that money in 
all three pots?
    Secretary Vilsack. Well, first of all, as I outlined with 
Congressman Latham, I think we are addressing the issue of the 
overpayments of folks who are not entitled to direct payments.
    Mr. Kingston. Except for, he said, the Senate has already 
eliminated that for this budget.
    Secretary Vilsack. No. I think earlier we had talked about 
the fact that farmers are basically allowing us to check IRS 
records to make sure that they are receiving payments that they 
are entitled to. And if they are not entitled to them, then 
obviously we will stop making those payments.
    Mr. Kingston. We want to work with you on that.
    Secretary Vilsack. So that is the first issue.
    The second issue is we have been working, I think, within 
the Department to aggressively address the error rate on the 
SNAP program. And I think if you look at the trend line, the 
error rate, the percentage is going down. There is still work 
to be done, and we are committed to making that effort.
    We have a partner in all of this, which are States, and we 
are working with States to try to reduce the error rate. I know 
in my State of Iowa, we were one of the worst culprits relative 
to error rates, and we really aggressively went after that and 
reduced it.
    And the third thing, in terms of the school lunch program, 
there are a multitude of reasons for this. One is that there 
could be a cashier error, there could be inaccurate information 
provided by parents, or there could be an error in the 
administration of the program. We are going to be focusing on 
technology and on training to try to aggressively reduce those 
errors. And we will have a proposal in the budget that attempts 
to redirect those resources.
    Ms. DeLauro. Mr. Hinchey.
    Mr. Hinchey. Thank you very much, Madam Chair.
    Mr. Secretary, thank you very much for the job you are 
doing and the experience that you bring into it.

                        FOOD SAFETY AND SECURITY

    I very much appreciate everything that you said in the 
context of your statement on the issue of food safety and the 
way in which you responded to the questions on that issue, 
because it is obviously something that is very important and 
something that we all care about, because it affects, 
obviously, the people that we represent. Food and agriculture, 
food and fiber are the two most important things for all of us 
in our lives, and so the job that you are doing is critically 
important for the safety and security of our country.
    So, with regard to food safety, I very much appreciate the 
attention that you are obviously giving to it. I know you don't 
oversee the Food and Drug Administration directly, but I know 
that you do have some interaction with them. That is an aspect 
of the government which hasn't really functioned properly for 
some years. And I am sure that you will do everything that you 
can to upgrade the work that they do and to improve the 
assurity of the Food and Drug Administration as they work to 
get things done in a proper way so that people are getting good 
quality, safe food.

                       AGRICULTURE CONCENTRATION

    I wanted to ask you a question about the way in which the 
agricultural system in our country is changing. Over the course 
of the last few decades, we have seen more and more 
concentration of agriculture in the hands of fewer and fewer 
companies. You have now, as you said, I think, in your 
statement, something like 70 percent of the food that is 
produced by large companies, mostly corporate agricultural 
companies, and they are responsible for most of the trade 
surplus that we have with regard to agriculture, which you 
pointed out as something that is important. But in a number of 
places around this country, we have a lot of small farmers.
    The agricultural system in New York State, as you probably 
know, is still very significant; a lot of agricultural 
production comes out of the State of New York. And most of that 
agricultural production is small family farms. So I am 
interested in what you think we should be doing in the context 
of this committee, in the context of the Congress, and what 
your intention is going to be on the issues of small farms, 
family farms; and maybe specifically in the context of the 2010 
budget, what might be done to support them, and what you might 
think the general economic circumstances that we are 
confronting now may be having negative effects on those small 
family farms, and what we need to do to ensure their 
continuation.
    Secretary Vilsack. In a very simplistic way, we have three 
kinds of farms and ranches in this country. We have very, very 
small operations, which are primarily specialty crop operations 
with sales of a couple thousand dollars or so that are usually 
funneling produce to farmers markets and for locally supported, 
community-supported agriculture. We had 108,000 more of those 
operations in the last 5 years than we did 5 years ago. So that 
is sort of a positive trend. We need to focus on encouraging 
markets for those producers and allowing them to migrate into 
midsized operations so that we can repopulate the midsized 
farms.
    We saw 80,000 fewer midsized farms in the last 5 years. 
Some of them migrated to larger operations, but the reality is 
we have a net loss there. I honestly think that in many, many 
parts of the country, opportunities for conversion of farm 
products into energy create a new opportunity for farmers not 
only to profit from the production of their crop, but also 
potentially the processing of their crop. And so you will see 
continued effort in this budget to promote more renewable fuel, 
more renewable energy opportunities in rural America.
    Then there are the large farms that you have alluded to. 
They, indeed, do produce a substantial percentage of what we 
consume and what we export. There, I think, we have to continue 
to look at research and development in terms of biotechnology 
to make sure that they continue to be productive.
    Overarching that, two issues: One, the issue of clean jobs, 
creating new opportunities with climate change for new income 
sources for farmers of all size; and then, two, understanding 
the importance of strong, vibrant rural communities that create 
off-farm income.
    As I indicated in my statement, 900,000 of the 2.2 million 
farmers and ranchers in this country are required to work 200 
days off the farm. Now, that is the operator, it is not the 
spouse. It is the operator. So we have to continue to modernize 
infrastructure in rural communities. We have to continue to 
expand broadband so that markets are opened up. We have to 
focus on quality-of-life issues, whether it is community 
facilities or housing, as alluded to earlier, all creating new 
opportunities.
    And I honestly believe that as we focus on clean jobs, as 
we focus on severing our dependence on foreign oil, that the 
real opportunity in that matrix is in rural America. And USDA 
is very aggressive in its effort to promote opportunities in 
all three categories of farm sizes. I think it is important.
    Mr. Hinchey. Thank you.
    Ms. DeLauro. Mr. Latham.
    Mr. Latham. Thank you, Madam Chair.

                            FORMULA FUNDING

    Mr. Secretary, the subject was raised a few minutes ago in 
the context of earmarks, but one thing that has always been a 
major frustration, I think, for us in this committee--we are 
kind of at a disadvantage because we have not seen details of 
the budget at this point--but there have been proposals in the 
past to cut formula funding for agricultural research, making 
competitive grants out of it. Obviously it has a huge impact in 
places like Iowa State University and all the land-grant 
universities.
    The Chairman and myself are probably on the same page on 
this, but can you tell us in the budget proposal what you are 
doing as far as funding for the land-grant universities and the 
formula funding that has the continuity of research?
    Secretary Vilsack. Representative, I could be corrected on 
this, but I don't believe that there is any reduction in those 
resources. I will tell you that we will be making an effort to 
make sure that the research is appropriately focused, and to 
make sure that we do a good job of making sure that we are not 
overlapping with other research that is taking place; that we 
maximize those dollars and better coordinate those research 
opportunities.
    There are some key areas; obviously biofuels, renewable 
energy, that is a key area. The notion of food safety is a key 
area. The notion of how we make meals attractive to youngsters, 
a key area. There are obviously priority areas where we are 
going to focus, but I don't believe that there is a reduction.
    Mr. Latham. Is there detail, Mr. Steele?
    Mr. Steele. Well, the detail will be provided when we 
submit our full budget, but we are not anticipating any cuts in 
the formula.
    Mr. Latham. You are not changing the formulas at all?
    Mr. Steele. Not that I know of at this point.
    Mr. Latham. Sounds good. We don't have that battle maybe 
this year for once.

                   RURAL HOUSING APPLICATIONS BACKLOG

    It was brought up earlier, in the stimulus package there is 
$1 billion for single-family housing and $10.5 billion for 
single-family home guaranteed funds. The concern I have is that 
the staffing to deal with this has, in recent years, dropped 
about 45 percent. I have heard from a lot of USDA employees out 
in the field that this huge influx of dollars going in, there 
simply is not staff there to be able to handle it. Do you have 
any comments about that?
    Secretary Vilsack. Well, we are fortunate, I think, in one 
respect, that USDA, that the Recovery and Reinvestment 
resources are going through traditional programs and existing 
programs, unlike many of the other departments of government 
where they have to formulate new programs. And in this 
particular area, what we are dealing with is a significant 
backlog that was not being addressed because of inadequate 
funding. So, many of these applications have already been 
processed, they are already out there, we already know who they 
are. We know what homes are being constructed. We know that 
5,000 jobs are likely to be developed as a result of these 
resources, and over 10,000 homeownership opportunities are 
going to be finalized. So we are addressing a backlog, which I 
think makes it a little bit easier than it would be if we were 
basically having to process new loan applications.
    Mr. Latham. Mr. Steele.
    Mr. Steele. Also, in the Rural Development area, Congress 
did provide additional money for administrative costs for rural 
development. I think it is $120 million or thereabouts. And I 
have been told by the RD agencies that they are going to be 
utilizing that money not only for some IT fixes, but also for 
hiring some contract and part-time people on a temporary basis 
to help implement this backlog, which is mainly a backlog, in 
most cases, which we should be able to get done, I think, 
without a major problem.
    Secretary Vilsack. And I would also say that those Rural 
Development folks also have the responsibility of focusing on 
the Business and Industry Loan Program. And I think that is 
where the concerns that you are raising are perhaps even more 
on point, because we have a substantial amount of opportunity 
here far beyond what we normally have. And that may be what 
people are concerned about, making sure that those programs are 
utilized as they should be and utilized as quickly as we need 
them to be utilized.
    Mr. Latham. Okay. To go off to another subject--and I am 
really doing well, three questions----
    Ms. DeLauro. Keep going, Mr. Latham.
    Mr. Latham [continuing]. And the red light is not even on 
yet.
    Ms. DeLauro. It is yellow, let us go.

                     INCREASE IN ETHANOL BLEND RATE

    Mr. Latham. Just very quickly. With the recommendation that 
you made for increasing the fuel standard to 15 percent or 20 
percent for ethanol--I believe to the EPA I wrote a letter to 
the President supporting your statement--is there any response 
back? Where are we on that?
    Secretary Vilsack. I know that the EPA has recently 
received a request from the industry to take a look at the 
waiver for E15, and I know that is under consideration. I don't 
have anything scientific to tell you today as to what the 
attitude of the EPA is on that. We are going to continue to 
advocate for an increase in the blend rate.
    In large part because of the concern that I have about 
maintaining the infrastructure that we have already invested in 
our biofuel industry, it is important, as we transition to 
second- and third-generation feedstocks, that we have in place 
the infrastructure to take advantage of those new developments. 
If we lose that infrastructure, it will be that much more 
difficult to get the biofuels industry back on track.
    Mr. Latham. Thank you very much.
    Ms. DeLauro. Ms. Kaptur.
    Ms. Kaptur. Thank you, Madam Chair.
    Welcome, Mr. Secretary. I was very drawn to your candidacy 
at one point about a year ago. We certainly welcome you and 
look forward to working with you.

                           URBAN FOOD DESERTS

    I represent the northern part of Ohio where that State 
meets Lake Erie, the most abundant of the lakes. And the 
district I represent is both urban--the city of Toledo and 
Sandusky--and rural. It is a most interesting district.
    I can report to you on the Recovery bill, the CSFP program 
has not resulted in additional food, but merely the same amount 
with rising prices. I think it is important for you to know.
    Number two, despite the increases in food stamps, food 
stamps in our area last about 2\1/2\ weeks. I want to encourage 
you on in your People's Gardens efforts. And I was just reading 
the story in the Economist, ``Digging Their Way Out of 
Recession''--you are prominently mentioned, very good story. I 
really believe that with new technologies, growing 
technologies, including in the urban environment, many of these 
food deserts can actually produce their own food. And we are 
about that task in Toledo, Ohio, but we need the help of USDA 
to, first of all, recognize what we are doing.
    I brought with me some photos of vertical-growing systems 
that are eight times more efficient than planting in the dirt. 
We are doing this right now. I would hope that USDA would take 
a look at places, urban areas across this country, from New 
York City to Chicago, to Toledo, that are trying to meet rising 
food needs, and to do this not just for important nutritional 
reasons, but also for cultural and for environmental. The USDA 
has been very resistant to understanding the importance of what 
new technology can provide us in meeting human needs across 
this country. I think you have the experience and the will to 
help us.
    So I am wondering if, for the record, you could summarize 
USDA authorities that could assist communities that are urban 
in nature that are trying to meet rising food needs in urban 
food deserts. Would you be willing to work with us? You have 
done it in your own building here in urban Washington. That is 
a sign to me that there is some recognition of the capability 
of production to happen in urban environments.
    Secretary Vilsack. Well, we take very seriously the issue 
of food deserts, and we understand and appreciate that they are 
obviously in places where people are struggling.
    One of the programs that we have some flexibility in to 
address the capital needs is the Business and Industry Program 
that I alluded to earlier. In talking with Bill Hagy yesterday, 
at a group where I was talking to urban and rural economic 
development proponents, he indicated and pointed out to me that 
there is some flexibility in that program to provide resources.
    Now, I will tell you that obviously our focus will continue 
to be, as I think it should be, on rural communities, because 
that is basically the job of USDA, but the issue of food 
security and food safety and nutritious eating--as it was 
pointed out earlier, two-thirds of our budget is allocated in 
that mission area, and so we have to take it seriously wherever 
there are problems.
    Ms. Kaptur. Thank you very much. We hope that someday the 
Department of Agriculture will understand that food isn't only 
grown in very large--on the plains, especially vegetables, and 
even chickens can be raised in urban environments where they 
are desperately needed, and, through aquaculture, fish. USDA 
has to catch up to the technology--I don't expect you to do it 
today, but just recognize that it exists--and keep an open mind 
as we move forward here.

                           EMERALD ASH BORER

    In view of the time, there isn't a lot of time here in 5 
minutes, but let me just tick off for you the emerald ash borer 
issue. We are hoping, in working with Secretary Bartuska, that 
we can get USDA to be an important player in the areas where we 
have serious infestation, such as with the emerald ash bore, to 
link what you do to what the Department of Interior is doing to 
what we can do through the Department of Labor, through the WIA 
and summer employment programs, to the Civilian Conservation 
Corps, to the Public Lands Corps. We need to have a coordinated 
effort to make maximum use of the public dollar. And I just 
check that off as one where we hope to work with you again. And 
it is extraordinarily important in Ohio and in Michigan.
    And finally, let me just mention again this issue of what 
is urban and what is rural. I represent the largest greenhouse 
industry in the Midwest in Lucas County and Lorain County. We 
have been ignored by USDA for 100 years simply because the 
greenhouses were there first, and then the local cities annexed 
them.
    And I am wondering if there is anything you can do to help 
us with eligibility for the 9007 program for retrofitting where 
energy is upwards of a third to half of the cost. We need to 
have USDA helping agricultural enterprise wherever they are 
located.
    Secretary Vilsack. That, the 9007 program, is a program 
that--I may be corrected on this--is primarily focused on 
retrofitting bioethanol facilities, isn't it, and other 
renewable energy sources? I would have to take a look at that 
specific issue that you have raised.
    [The information follows:]

    The section 9007 Rural Energy for America Program (REAP) is 
entirely different from the Business and Industry (B&I) guaranteed loan 
program. REAP is limited, by law, to agricultural producers and rural 
small businesses. Our regulations for this program define 
``agricultural producer'' to include nursery stock. However, they 
currently require that the project be located in a rural area. We 
propose to change the regulations for FY 2010 to allow agricultural 
producers in non-rural areas to be considered for REAP assistance.
    For the Business and Industry (B&I) guaranteed loan program, the 
2008 Farm Bill included provisions that allow flexibility for areas 
that would otherwise be considered ``non-rural'' to be determined to be 
``rural in character'' and, thus, eligible for assistance. Communities 
that wish to be considered for such a determination should contact 
their State Rural Development office.

    Secretary Vilsack. On the Emerald Ash Borer, I would just 
tell you that we have about 185,000 square miles of Federal and 
State land that has been quarantined because of that. It is a 
very, very serious issue and allows me to point out, that 
invasive species is a very serious consequence to the economy 
and one that we need to take seriously. And it gets back to 
Congressman Latham's question about research; that is a focus 
in another area that we obviously have to focus on.
    Ms. Kaptur. Mr. Secretary, in closing, let me just say, we 
warmly invite you to the 9th District of Ohio to view our urban 
growing systems as we meet this terrible recession where 
unemployment rates are now close to 10 percent in some counties 
and over 17 percent in others.
    Thank you.
    Ms. DeLauro. Thank you, Ms. Kaptur.
    Lots of invitations, Mr. Secretary. I know you are trying 
to cut back on the travel budget.
    Mrs. Emerson.
    Mrs. Emerson. Come down to Missouri.
    Thanks, Madam Chair.

                          FARM PAYMENTS LIMITS

    Secretary Vilsack, let me go back to the payment limits 
issue, just because I wanted to follow up something that Tom 
said earlier. But mine has to do with the fact that you all at 
USDA--there are about 19 different, separate and distinct 
changes made to payment limits in the 2008 farm bill, all of 
which are right here, and I am sure you know it.
    And you probably also know that that is probably three 
times more than--or it is more than the last three farm bills, 
combined, did. However, Congress was silent on the definition 
of ``actively engaged,'' and I know that you all at the 
Department have authority to define the term.
    But can you share with us, please, the Department's 
reasoning, why it is necessary to redefine ``actively engaged'' 
at least once, but potentially twice, over the next year? 
Because my farmers--and let me just follow that up by saying my 
farmers need certainty.
    You know, everything changes. Every year things change. 
They can't plan out, and they are small businesses. They can't 
plan their lives and their businesses out 5 years because of 
all these changes.
    Secretary Vilsack. You are correct that there were 
significant changes in the farm bill. We are interested, as a 
new administration, to make sure that we fully appreciate and 
understand all of the changes that went into place in 
regulation just prior to our taking office, and so we basically 
called a timeout; and with this particular area, we encourage 
more comment.
    So we are still in the middle of the comment period. And I 
would like that process, if I might, to allow it to continue 
and go through the process to figure out precisely what 
people's attitudes are.
    I think sometimes with these definitions, and I don't know 
necessarily with this one, but just as a general proposition, 
that there are oftentimes unintended consequences or 
circumstances that arise during the course of implementation 
that people think, well, we didn't think about that. We need to 
fine-tune it.
    I don't know that that will be the case of ``actively 
engaged.'' I won't know until we have had an opportunity to 
receive the comments and analyze them.
    Mrs. Emerson. Time period?
    Secretary Vilsack. Well, the accounting period expires this 
month, and so we would anticipate and expect taking a look at 
those comments April 6.
    Mrs. Emerson. Okay. Let me switch to a different subject.

                     FARM STORAGE FACILITIES LOANS

    Has the stimulus funding--because you all got so much money 
in the stimulus bill, and I am not complaining about where a 
lot of it is going to be allocated at all--but I am curious if 
the funding that you all got for the stimulus has in any way 
slowed the allocation and disbursement of long overdue fiscal 
year 2009 monies.
    And here is my example. Farm storage loans, the bill was 
signed into law almost a year ago, and I am just curious why it 
has taken 6 months for rules to be prepared for a farm 
facility, farm storage facility loans. Because we are going to 
miss another crop year and because our farmers also continue to 
suffer from the basis differentials, we need those storage 
loans sooner rather than later.
    Secretary Vilsack. Well, our focus in terms of rulemaking 
has been threefold:
    One, making sure that we get the ACRE payment program, 
which is part of the overall safety net, in place as quickly as 
we can;
    Two, upgrading the implementation of the energy portion of 
the farm bill, which we think has exciting potentials for rural 
America. As you well know, there were a number of provisions in 
that energy title that needed to be implemented, and we are in 
a process of trying to get funds out as quickly as we can, 
perhaps late this spring, early summer, on some of those 
programs; and
    Three, we wanted to make sure that the conservation 
security stewardship program, which is also extremely important 
in terms of planning, that the rulemaking and so forth was 
finished on a timely basis. So that has been where the focus 
has been.
    I specifically don't know about that particular rule. We 
will be happy to check and get back to you.
    [The information follows:]

    The rule for implementing the farm bill changes to the farm storage 
facility loan program was delayed for reasons other than the effects of 
the stimulus bill. Because the farm bill expanded the farm storage 
facility loan program to also include storage for hay, renewable 
biomass and other storable commodities which will likely require other 
types of storage than the traditional grain storage facilities it was 
determined that a Programmatic Environmental Assessment (PEA) would be 
required before the regulations could be published. On March 18, 2009 
the Department issued a press release announcing two public meetings to 
be held in April to solicit public input for the PEA regarding the 
potential impact on the environment. The comments are due May 13 at 
which time the PEA will be prepared for publication in the Federal 
Register. According to the National Environmental Policy Act at least a 
30-day comment period must be provided for in the PEA before the 
regulation implementing the farm bill provisions can be published. 
Given those requirements the rule for the farm storage loans should be 
ready for publication in mid-July.
    Fortunately the delay has not prevented USDA from making farm 
storage loans under the regulations which were in place before the 2008 
farm bill. In addition to the expansion of the scope of the program 
mentioned earlier, the 2008 farm bill increased the maximum loan term 
from 7 years to 10 years and it increased the maximum loan amount from 
$100,000 to $500,000. The currently available loans are for grains, 
oilseeds, and peanuts; once the rule is put in place additional crops 
will be eligible as noted above and the loan terms and maximum levels 
will be increased.

    Mrs. Emerson. I would appreciate it.
    I have another question, Madam Chairman, but I think I am 
going to let it go because it may require longer, and I will go 
into the red.
    Secretary Vilsack. Just the storage loan is expected to 
clear in July of this year.
    Mrs. Emerson. Still might be too late, then.
    Okay. Thank you. I appreciate that.
    Ms. DeLauro. Thank you, Mrs. Emerson.
    I am just going to rattle off three or four questions, and 
I am going to try to make the questions very short. And I will 
ask you, Mr. Secretary, to make the answers short as well.

                        CHILD NUTRITION PROGRAM

    You have asked for $1 billion in the proposed 2010 budget 
blueprint to accomplish the goals on child hunger and childhood 
obesity. In your view, is that enough? Mr. Spratt, Chair of the 
Budget Committee in the Congress, has proposed $2 billion per 
year.
    I am going to do for the record what CRS listed as program 
initiatives for the Child Nutrition Program, and then ask you 
to comment on them. But I will submit those for the record on 
how we might try to look at nutrition reauthorization and what 
we should do with regard to income levels, start-up grants, 
simplifying the food service rules, et cetera, and what we do 
about competitive foods.
    About competitive foods--and I want to get an answer to 
this question--while we can regulate nutrition standards 
through federally reimbursable school nutrition programs, what 
should we do about competitive foods offered in schools? Should 
we make competitive rules mandatory or leave it to the school 
districts to decide?
    What changes are we going to deal with to implement and 
what authorities are you going to request for child nutrition 
reauthorization and response to the IOM report?
    Local school wellness programs and policies are supposed to 
be in place. Should we mandate schools to start a local 
wellness program to force school districts to take these issues 
seriously?
    Again, with regard to education programs, like the dietary 
programs on nutrition education, how are we going to--I am told 
that we are looking at 2 years before we will know the 
effectiveness of some of the education messages that are out 
there with regard to what is good, what is nutrition, et 
cetera. How do we circumvent this 2-year process in this area, 
and can we succeed in making behavioral change, given the 
marketing and advertising to kids? Can we exercise controls in 
enforcing the marketing to children similar to what we do for 
cigarettes?
    Secretary Vilsack. How much time do I have?
    Ms. DeLauro. We are still on green. Let's keep rolling, Mr. 
Secretary.
    Secretary Vilsack. Your first question about the resources, 
you know, obviously we have proposed a billion dollars, but we 
also believe there may be opportunities within the existing 
budget to redirect resources to encourage more nutrition and 
more quality foods. And I would like the opportunity to prove 
that case.
    As it relates to competitive foods, obviously, I think that 
the time has come for us to have a very serious conversation 
about precisely what foods are in our schools. I am 
particularly focused, myself, on elementary and middle school. 
I think you have got to get these youngsters early and get 
habits that are good habits.
    Ms. DeLauro. Should we mandate the rules?
    Secretary Vilsack. You know, I think we need strong 
enforcement opportunities, and I think we need either mandates 
or incentives, either one. You know, I think incentives work if 
they are structured properly.
    As it relates to the Institute of Medicine study, you know, 
our goal is to try to institute whatever recommendations they 
propose as quickly as we possibly can. We obviously--I 
obviously don't know what kinds of costs will be associated 
with their recommendations, but we are going to take them 
seriously. We didn't ask for the study just to waste people's 
time and energy. We are looking for serious recommendations.
    Ms. DeLauro. I am looking to you, honestly because, as 
governor, you supported limits on the competitive foods, and 
you did that during the last child nutrition reauthorization. 
And as a department, it was three decades ago the Department 
tried to ban chips, cookies, soft drinks from schools, but was 
thwarted by the courts and by food companies. That means 
standing up to the--you know, and I look at us--and standing up 
to these challenges about what is in the best interests of our 
kids and nutrition.
    Secretary Vilsack. I think it is important to send a 
consistent message that we are serious about this, because 
there are long-term health consequences and economic 
consequences if we don't address this aggressively.
    On wellness, the child nutrition programs in 2004 required 
wellness policies. I am not sure how well that worked, and we 
are in the process of encouraging the Healthier U.S. Schools 
Program. I intend to be a little bit more vigilant on this than 
perhaps we have been in the past.
    If you all direct us to do something, it is my 
responsibility to see that it is done.
    Ms. DeLauro. Okay.
    Secretary Vilsack. On the education issue, you know, this 
is an interesting one----
    Ms. DeLauro. Mr. Secretary, I am going to have to, in order 
to--I am out of time.
    Mr. Farr.
    Secretary Vilsack. I did.
    Ms. DeLauro. You did and you did well. We will talk about 
the other one later.
    Mr. Farr. Thank you, Madam Chair.

                           NSLP OVERPAYMENTS

    Mr. Secretary, I have two questions, one in relation to the 
discussion you had with Mr. Kingston on the overpayment or the 
missed payment on the school nutrition program.
    President Obama said he wanted to eliminate childhood 
hunger in the United States. I think the issue goes that these 
schools sometimes feed the kid whose family may have the money 
to pay for the lunch, but didn't give the kid any money. So we 
feed him because he is hungry. And so I think we have to figure 
out how we streamline this program so maybe we do err on that, 
on feeding a kid who is hungry, regardless of a parent's 
income.
    I mean, we don't check that child for a means test when he 
got on the bus in the morning. And we don't check that child 
for a means test before he checked out a library book from the 
library, but we means test him before he can get any food in 
the lunchroom. And if they are hungry, I think we ought to be 
feeding them.
    I think you can find some savings from this consolidation 
and streamlining, even considering kind of block grants to 
schools that constantly qualify for these moneys. That was a 
statement.

                   FARM BILL PEST AND DISEASE FUNDING

    And the question I have is that last year in the farm bill, 
we incorporated pest and disease language, and I represent the 
area where the breakout of the light brown apple moth--and 
other pests breaking out, but that is the big one of the 
moment. So we spend about $50 million annually in California to 
control these invasive species.
    But so far--and the law specified that the Commodity Credit 
Corporation shall make available $12 million for fiscal year 
2009, $45 million for fiscal year 2010. The previous 
administration abrogated their duty to implement the pest and 
disease provisions of the farm bill and left it up to you, and 
there are only 6 months left in fiscal year 2009.
    OMB has not appropriated the fiscal year 2009 funding yet 
for pest and disease. It must be obligated by the end of the 
fiscal year, use it or lose it. I was wondering if you will 
work with us to help get OMB get this program up and running as 
soon as possible.
    Secretary Vilsack. I have been advised that the status of 
funding is focused on the last days of the second quarter of 
this fiscal year, so it looks like we are working on trying to 
get those resources available.
    Mr. Farr. We will get the full funding for the whole----
    Secretary Vilsack. $12 million.
    Mr. Farr. $12 million?
    Secretary Vilsack. Yes, sir.
    Mr. Farr. All right. When do you think that will----
    Secretary Vilsack. It says last days of the second quarter 
of fiscal year 2009.
    Mr. Farr. Last days of the what--there is a date for that, 
isn't there?
    Secretary Vilsack. It would have been better off just 
telling you ``soon.''
    Mr. Farr. All right.
    Secretary Vilsack. We will get you the specific date.
    [The information follows:]

    Plant pest and disease funding, provided in the 2008 Farm Bill, was 
made available for obligation to the Animal and Plant Health Inspection 
Service as of March 30, 2009.

    Mr. Farr. Thank you.
    I am under the green light. You can take it away, Madam 
Chair.
    Ms. DeLauro. Mr. Bishop.
    Mr. Bishop. Thank you very much.

                     FARM AND NON-FARM INCOME TESTS

    Mr. Secretary, you recently announced a collaborative 
effort with the IRS, which I understand will allow you to 
improve the administration of the adjusted gross farm and 
nonfarm income test. While I understand the importance for 
strong oversight, I am concerned about the exchange of the tax 
information between the IRS and the USDA.
    Since the new income tests are based on farm and nonfarm 
income, not adjusted gross income, which is readily available 
on the income tax returns, what specific data will you ask IRS 
to review in order to provide USDA with the information that 
USDA can actually utilize?
    And how will the data be communicated between IRS and USDA? 
And how can you ensure that that won't be any breach of 
privacy? And will that information be subject to a Freedom of 
Information Act request?
    Secretary Vilsack. It is my understanding that what will 
happen is that on a relatively small number of accounts, USDA 
will provide the IRS with some kind of taxpayer identification 
that indicates that this individual has received farm payments.
    The IRS will then--with the authority provided with the 
document that is signed at the time folks receive payments, 
will essentially then check to make sure that the income that 
was reported was at or below whatever level it needed to be in 
order for those payments to be authorized. And at that point, 
they will communicate back to the USDA that farmer X or lawyer 
B was either entitled to receive the payment or not entitled to 
receive the payment.
    There won't be any tax document that goes to Farm Service 
Agency offices. It will just be an exchange of basic 
information saying this person has qualified for payments or 
has received a payment or is applying for a payment, check to 
see whether or not he was legitimately entitled to receive the 
payment.
    Mr. Bishop. Thank you. That is my question.
    Secretary Vilsack. Might I just add just one other point. 
If a farmer believes that a determination by the IRS is 
inappropriate, they obviously have the appropriate appeal 
rights.
    I don't know the answer to your Freedom of Information 
request, but we will get that to you.
    Ms. DeLauro. I just want to make a point on that, and there 
is a little time remaining there.
    I would repeat, there are many programs, food stamps on up, 
that receive information from the IRS. So this is nothing new. 
People are doing it, and we ought to be able to follow suit 
where we find difficulties.
    I think it is important to note, from 1999 to 2005, USDA 
paid $1.1 billion in farm payments in the names of 172,801 
deceased individuals, either as an individual recipient or as a 
member of an entity. Of the total, 40 percent went to those who 
had been dead for 3 or 4 years; 19 percent went to those dead 
for 7 or more years.
    I think we need to get this under control.
    Secretary Vilsack. Madam Chair, just to comment, the 
analysis that Dave just provided to me indicates that our 
analysis is, it is not FOIable, not subject to the Freedom of 
Information Act.
    Mr. Bishop. Madam Chairman, my concern was making sure that 
the information you got from IRS was checking apples and apples 
to oranges and oranges, and that the information would be, in 
fact, helpful.
    Secretary Vilsack. And we are in the process of devising 
specifically how this is going to be done, but the way in which 
I have outlined with USDA saying this person has received 
payments, check and make sure whether or not they are entitled 
to it so we don't have a replication of what the Chair just 
outlined.
    Ms. DeLauro. Mr. Kingston.
    Mr. Kingston. Thank you, Madam Chair.

               EARMARKS ELIMINATIONS/PROGRAM TERMINATIONS

    Mr. Steele, I wanted to go back to that list in terms of 
the letter I want you to send me.
    How much money does eliminating earmarks save? You 
answered, but I would just like to see it again.
    And then the programs that were eliminated and the 
contracts, because there has been this Stan Johnson issue that 
has come up from Iowa--you are probably familiar with it; there 
has been some press about it, contracts like that--how many of 
them have been eliminated.

                Contracts Eliminated in the 2010 Budget

    Detailed budget information is scheduled to be released later this 
spring. Information on termination of contracts during 2010 will not be 
known until the completion of the fiscal year.

    Mr. Kingston. So, and then number two, Mr. Secretary, you 
may have seen this article, it was covered by the AP about a 
woman in Warren County, Ohio, who has qualified for food 
stamps, but she has $80,000 in the bank and paid for a $311,000 
house and a Mercedes because of the liberal interpretation of 
assets won't be counted against you.
    As you know, we had liberalized the qualifications, saying 
that we want people to have college education accounts and 
assets that are maybe good assets and not have that used 
against them for eligibility of food stamps. But this appears 
to be a real abuse of it, and I think it is going to be an 
embarrassment for the USDA if we don't address it.
    Do you want to comment on it now, or are you looking at 
something?
    Secretary Vilsack. I have not actually seen that article, 
and I would say that we obviously have some categorical 
eligibility systems in place, and there may well be 
circumstances in situations, as you have outlined.
    Again, I don't know the accuracy of that report.
    Mr. Kingston. If you will just look at it, I think that 
this is going to be solved outside of this room if we don't be 
proactive and solve it inside this room, because I think it is 
the type of thing that, you know--this puts a face on the 
abuses out there.
    [The information follows:]

    Recent articles in the Ohio press have indicated that a woman with 
an $80,000 bank account, a luxury car, and a $300,000 home was getting 
SNAP benefits, and questions have been raised whether this is a proper 
use of program funds. Under current law, households in which each 
member receives benefits from other means tested assistance programs, 
including Temporary Assistance to Needy Families or Supplemental 
Security Income, are automatically eligible for the Supplemental 
Nutrition Assistance Program (SNAP) benefits. This is called 
``categorical eligibility'' Also under current law, States have the 
flexibility to extend categorical eligibility to households that not 
only receive the traditional cash assistance, but who receive or are 
authorized to receive other services or in-kind benefits. This 
``expanded categorical eligibility'' pertains to households whose 
incomes are below 200 percent of poverty, without regard to assets.
    First, the scenario described in the articles assumes the person is 
categorically eligible for the program which means the assets of the 
household are not counted as provided in law. This is not true without 
the substantiation of categorical eligibility since the asset test for 
most households is $2,000 or $3,000 when there is an elderly or 
disabled member in the household. Under the categorical eligibility 
rules, even if a household has substantial savings, it must meet the 
net income eligibility guidelines in order to qualify for SNAP 
benefits. In other words, the household's income must net out at 100 
percent of the poverty limit to receive benefits, and if not, they may 
be categorically eligible, but the benefit amount would be zero.
    Second, the value of a home has never been considered as a resource 
in this program. Many working people who lose jobs may be without any 
income and we hope that SNAP can help them through a hard time and they 
don't lose their homes. Finally, since 2001, States have had the 
flexibility to exclude vehicles from the resource test--in the regular 
program as well as when categorical eligibility has been established. 
Almost every State excludes at least one vehicle per household. Most 
people need a car to get to work. States don't have to spend time 
documenting car ownership and fair market value. Again, people who lose 
jobs may have more valuable cars but if they don't find work soon they 
won't be able to keep up with the car payments. During these difficult 
economic times, categorical eligibility enables SNAP to meet the 
household's immediate food needs and affords States administrative 
relief in determining eligibility.

    Mr. Kingston. I wanted to switch gears with you, though.

                     ALTERNATIVE ENERGY INITIATIVES

    In terms of the President's number 2 and 3 goals, which 
relate to energy efficiency, I don't know if you are familiar 
with this report by the Research, Education and Extension 
Service, came out last March; and it was by Gale Buchanan, who 
was the under secretary at the time.
    You probably haven't seen it, and I don't think that 
position has been filled, but this was done by the USDA at the 
urging of this committee, members of this committee, 
individually and collectively. So I think it is a pretty good 
report and it is totally in line with the President's number 2 
and 3 priorities in terms of alternative energy and stuff like 
that.
    So I will give it to you before you leave the room, but I 
am sure you have lots of people who have actually coauthored 
that.

                              TRADE ISSUES

    Then my next point that I wanted to make, within the 5 
minutes, is on trade. I am interested in trade. I am somebody 
who had actually voted against NAFTA and voted against GATT and 
most favored nations with China; but I realize now it is a 
completely different world and that there are a lot of 
different opportunities out there for our farmers in terms of 
international trade.
    And yet we get some mixed signals from this administration. 
Sometimes the President seems to talk a good game about global 
trade, but then it seems that things like the Colombia Trade 
Agreements are not even going to be put on the floor of the 
House for a vote.
    Will the USDA be getting involved in urging Congress to 
look at trade agreements?
    Secretary Vilsack. Well, let me just use your question to 
give sort of an overview, and then I will respond to it.
    We expect exports to be down a bit from where they were in 
2008, but that was a record year. The expectation is that 
exports will still be higher than they were in 2007, and that 
was the second-highest year. So we are still aggressively 
pursuing exports.
    I will tell you that we have an issue that has to be dealt 
with. The inspector general has suggested that we needed a more 
coordinated approach and a better marketing strategy for some 
of our crops, particularly biotechnology, and we are going to 
work on that. We are going to work closely with Ron Kirk, the 
U.S. Trade Representative, to make sure that agriculture and 
agricultural interests are always at the table and that people 
understand, as we negotiate and discuss trade agreements, that 
we, in fact, protect the agriculture interests of this country. 
That is something that I think is my responsibility.
    And we intend to be aggressive in an effort to try to 
encourage our trading partners. We have issues relative to beef 
that need to be addressed, I think fairly aggressively, with 
some of our trading partners, which could open up new 
opportunities. We haven't quite recovered from the BSE 
circumstance in 2003. We are focused on some of the countries 
that could help us get back up to 2003-and-beyond levels.
    Mr. Kingston. Okay, well, thank you. And I am out of time.
    Ms. DeLauro. Mr. Davis.

                      VENDING MACHINES IN SCHOOLS

    Mr. Davis. I heard a story once about a technician who went 
to one of the farms and was trying to advise a farmer what he 
should do conservation-wise. And the farmer said, Young fellow, 
I know you have just graduated from college, but I have owned 
three farms before you came here. I understand how to farm.
    But I went to high school and graduated in 1962; and prior 
to that in the elementary school systems, I never saw in our 
school buildings a dispenser where you could plug in and get a 
soda pop, where you could plug in and get a candy bar, where 
you could plug in and get some, in my opinion, lack of 
nutritious food.
    My wife teaches. She will retire this year, 30 years. She 
says one of the worst problems we have today, that is bringing 
about obesity, is the convenience of the machines that you plug 
your money in, that your parents send you to school with, and 
buy that instead of the hot-lunch program.
    Are you willing to say that any school that obtains hot-
lunch program, that gets dollars to where we can have a 
nutritious program for our children, that we will ban those, in 
my opinion, that we will ban those facilities from those 
schools?
    Secretary Vilsack. Congressman, I am willing to say that we 
need an aggressive policy on vending machines and on those food 
products.
    Now, I am particularly focused on elementary and middle 
schools, in particular, because I really do believe that you 
have to get those habits early, early. And the chairwoman 
mentioned earlier advertising, and I think it is important for 
us, for the food industry, for USDA, for all of us to 
understand this isn't just about children and education. It is 
really about health care, it is about the future of this 
country. So this is a very important subject.
    Now, I am willing to work on mandates or incentives, or a 
combination of both, to make sure that we have as healthy and 
as well an environment as we possibly can for our children.
    Mr. Davis. I am not implying that vending machines are all 
bad; if they have fruit in those, or fruit juices, nutritious 
food that a child can obtain, I am okay with that. But some of 
the high sodium, some of the low nutrients that are our 
children are getting.
    My wife teaches second grade. She taught first grade for 14 
years. I know these are used from time to time to raise funds 
to buy paper or pencils for children, but there ought to be 
another way to do it.
    I just hope that we can work together in being able to 
bring about at least a change of the dollars that we spend to 
use that--I don't want to use this as a bully pulpit or a 
hammer, but we have got to start looking at the health 
conditions our children will bring to themselves when they 
become adults, through obesity and diabetes.
    Secretary Vilsack. I would also suggest that we need to 
look at earlier in life. We need to do--continue to do a job of 
educating young parents about the nutritional needs of their 
children, and we need to do a better job of focusing on child-
care facilities and preschool facilities to make sure that the 
snacks and programs that are available, that we send a 
consistent message.
    We have started a process with public service 
announcements, and basically working with some of the better-
known children shows, like Sesame Street, to encourage young 
parents to really focus on this.
    Mr. Davis. WIC has done, I think, in my opinion, a pretty 
decent job with that, but we do have to do additional 
education.

                             RURAL HOUSING

    The second thing I want to talk about--my time is about to 
run out. 1967, when I talked a moment ago about housing in 
rural areas through the direct loan program of 502 individual 
housing, we actually built 47,973 homes. That grew 10 years 
later towards 107,000 individual homes that were built in rural 
America. And it had to be in America, in towns that had less 
than--I think 2,500 through 3,000 population at the time was 
the number. Today--as an example, 100,000 then, 30-some years 
ago--today, through the guarantee program, 58,000 and 9,000 
direct, roughly 68,000 homes, opportunities today for rural 
Americans who have--in my opinion, the others are being left 
out because they don't know where to go.
    I hope we take a serious look at the 502 loan program in 
being able to add additional funds through the guarantee 
program and bring back the low-interest creditor interest 
assistance loans.
    My time is about to run out. Thank you, sir.
    Secretary Vilsack. Well, I think there is also a great 
opportunity for us to make those homes that do exist in rural 
America far more energy efficient.
    Mr. Davis. Oh, no question.
    Secretary Vilsack. And that creates new jobs and new 
companies.
    Mr. Davis. That has to happen. That will be part--efficient 
homes will be part of any energy policy we have. I am not as 
concerned about--as some folks about global warming or climate 
change. It is economic security and it is--national security is 
why we have to have, in my opinion, a new energy policy in this 
country.
    Ms. DeLauro. Mr. Hinchey.
    Mr. Hinchey. Thank you, Madam Chair.

                              LOCAL FARMS

    I just want to return briefly to the idea of local farms, 
small farms, family farms. And I was trying to find out what 
approach was being taken in the recommendations of the 2010 
budget for those issues: small family farms, what was being 
done to promote agriculture at that level.
    Secretary Vilsack. Well, a series of efforts to create 
local markets, so that it is easier for people to market the 
products and produce that they are producing: the Farmers 
Market Promotion Program; the Senior Farmers Market Nutrition 
Program; the Special Supplemental Program for WIC; resources in 
the SNAP program; as well as school nutrition.
    We are trying to create--and using some of the B&I loans to 
create distribution centers so that folks in the local area can 
sort of consolidate their products and then, in turn, those can 
be sold to institutional purchasers so that you create local 
markets. There is going to be a significant focus on creating 
more local market opportunities.
    When you have 108,000 new entrepreneurs out there who are 
selling several thousand dollars worth of goods, if you can get 
them more markets, more opportunities to expand, you can move 
them ultimately into mid-sized operations. That helps to 
repopulate rural communities; it helps to create a series of 
new businesses that are offshoots of that effort. It supports 
the local implement dealer, it supports the local hardware 
store, it supports a wide variety of activities; so a focus on 
creating markets.
    Mr. Hinchey. Well, that is very good. I think the markets 
are there, no question about it. And I think that there is a 
growing interest on the part of a lot of people who live in 
urban areas, particularly in large cities, who are interested 
in locally grown produce, things that are grown nearby. And 
because they are grown nearby, they understand that they are 
fresher and probably better, probably more safe and secure.
    Secretary Vilsack. I think there is a growing desire on the 
part of consumers in America to know more about their food, and 
that is a good thing.
    And I hope that young people--in particular, that we do a 
better job of educating young people precisely about where 
their food comes from, which is why these gardens in the urban 
centers in schools and USDA locations around, I think, are 
important to be able to reconnect people with precisely where 
their food comes from.
    It doesn't come from a grocery store. It comes from a farm 
or a ranch initially.

                      URBAN AND RURAL DEVELOPMENT

    Mr. Hinchey. Just finally, is there any interest in what 
seems to be in some rural areas kind of rural development, 
which is going on, which is eliminating the ability of 
agriculture to function on those areas?
    In other words, agricultural lands are being turned into 
community development properties, houses are being built, 
things of that nature, spreading out. And I think that is 
happening in a lot of areas close to urban areas, particularly 
here in D.C. In places like Maryland and Virginia there are a 
host of agricultural lands that are being just taken up as a 
result of increase in development, particularly housing 
development.

                    CONSERVING AGRICULTURAL PROPERTY

    Is there any interest in that, to try to ensure that in the 
long term we are able to sustain the kind of good, substantial 
agricultural property that we have to produce the food and 
fiber that our country needs?
    Secretary Vilsack. I would say that there are several 
initiatives. One is to make sure that we are investing, not 
just in new development, but in the rehab of existing 
facilities.
    Back to Congressman Davis' point, I think it is important 
and necessary for us to consider looking at reducing sort of 
the carbon footprint of development in the future. One way you 
do that is by taking existing buildings and making them more 
efficient, modernizing them and creating new opportunities, 
particularly in central business areas that have become 
somewhat dilapidated or are in tough shape. There is real 
opportunity there for rehabs.
    Secondly, I think it is also important for us to continue 
to invest in conservation techniques so that we preserve the 
quality of our soil and our water. It is very, very important 
for us to do that, and frankly, we need to do more of that.
    The top soil that we are all used to, if we don't do the 
right things from a conservation standpoint, won't always be 
there. And we are seeing the effects of that in some of our 
rivers and streams and down in the Gulf.
    So there are multiple strategies there.
    Mr. Hinchey. Mr. Secretary, thank you.
    Ms. DeLauro. Mrs. Emerson.
    Mrs. Emerson. Thank you.
    Let me mention something interesting to Maurice and also to 
you, Secretary Vilsack. I actually have a few farmers who--in 
my very big rural district, who actually grow hydroponics 
specifically for the school-lunch programs, so that our kids in 
our schools, who normally are eating french fries and burgers, 
actually are having some good things. So--we are doing new 
things, even in rural areas where we would traditionally do row 
cropping, so just by way of interest.

                     MCGOVERN-DOLE FEEDING PROGRAM

    I also want to thank you, Secretary Vilsack, for your 
initiative, your recent initiative, to transfer nonfat dry milk 
from the CCC to the Food and Nutrition Service for domestic 
food programs; and also so, so grateful for the 500,000 pounds 
of nonfat dry milk for the McGovern-Dole school feeding 
program. It will make a huge difference.
    Do you have any idea how many of the world's hungry 
children are going to benefit from this initiative?
    Secretary Vilsack. I don't have a number. I will tell you 
that it complements what we are trying to do on the budget, 
which is to increase funding for the McGovern-Dole Program. 
That is funding--as you well know, better than I do, it has 
been fairly static; and this is an opportunity, I think, for us 
to put a slightly different face on America through the use of 
what we grow and also what we know.
    I am hopeful that we do a better job of encouraging 
developing nations to take advantage of the technical 
assistance and help that we can provide.
    Mrs. Emerson. Well, I hope--I know that your heart is 
there, and I just hope that this will be a sustained effort 
over time. And it will also--it also happens to benefit our 
dairy farmers as well, who are really, really hurting right 
now.
    Secretary Vilsack. They are indeed. And I do know that in 
2009 we expect the McGovern-Dole bill generally to assist 
nearly 4 million people.
    [The information follows:]

    The 500,000 pounds of nonfat dry milk from Commodity Credit 
Corporation inventory will benefit approximately 50,000 children per 
year for three years through Save the Children's McGovern-Dole school 
feeding program in Yemen. These children are among the 4 million 
beneficiaries in FY 2009 of the McGovern-Dole program. The donated milk 
will be combined with baking powder, corn soy blend, salt, vegetable 
oil and years to be baked into bread and fed directly to children in 64 
schools.

    Mrs. Emerson. Excellent.
    Well, I certainly appreciate, and all of us here so 
strongly believe in that program that anything that you all 
will be willing to do to rob from Peter to pay Paul to increase 
that funding would be wonderful. And there is more than just 
feeding hungry people; we benefit as a country as well.

                 MARKET DEVELOPMENT ACTIVITIES IN CUBA

    I have a question. You probably may need to answer it for 
the record, because it is a little long and it is a forward-
thinking question. But it has to do with Cuba. And in our 
fiscal 2009 omnibus bill we actually had a recommitment of 
sorts to allowing simple cash-in-advance sales of agricultural 
goods to that country.
    Well, the Secretary of Agriculture--excuse me, of the 
Treasury, not you, indicated an unwillingness to follow 
congressional intent. Many of us in Congress are going to 
continue to try to expand legal sales of agricultural products 
to Cuba. I am happy to report that we sold $700 million in 
2008, which is the largest year ever.
    Anyway, in that context, it is my understanding that U.S. 
agricultural industry trade associations, such as the FAS 
Foreign Market Development cooperators or the Market Access 
Program participants are allowed to undertake market 
development activities in Cuba, provided they receive a 
license, but not using Federal funds.
    And I need--I would like to know, for the record, unless 
you know, is the prohibition statutory or is it regulatory; and 
what other countries might we limit in this same manner?
    Secretary Vilsack. I don't know the answer to that 
question, and we will be happy to provide it to you.
    [The information follows:]

    Commodity Credit Corporation funds may not be used for market 
development or export promotion activities in Cuba and certain other 
countries. Section 908(a)(1) of the Trade Sanctions Reform and Export 
Enhancement Act of 2000 states that ``No U.S. Government assistance, 
including United States foreign assistance, United States export 
assistance, and any United States credit or guarantees shall be 
available for exports to Cuba or for commercial exports to Iran, Libya, 
North Korea, or Sudan.'' However, in 2004, former President Bush waived 
application of this provision to Libya. These prohibitions do not 
prevent private U.S. entities, including USDA cooperators, from 
undertaking activities in Cuba with their own funding. Such private 
activities by USDA cooperators, however, cannot be counted as 
contributions to USDA supported programs.

    Mrs. Emerson. I appreciate that and appreciate anything 
that you can do to help our farmers and producers be better 
able in the future to excel.
    Secretary Vilsack. That is a complex issue, as you well 
know.
    Mrs. Emerson. Thanks.
    Ms. DeLauro. I would just want to put an asterisk as to 
what Mrs. Emerson talked about with the McGovern-Dole; and I 
would ask you, Mr. Secretary, many of us fought for McGovern-
Dole in the last farm bill, and we were--we thought we had made 
a little bit of progress. This committee, this subcommittee is 
committed to McGovern-Dole.
    One of the things we heard over and over again--and I hope 
that we can use your good offices for this, is that McGovern-
Dole--what is it, what is it about, it is not working, it is 
not an effective program. It is clearly one of the most 
effective programs. We had such a difficult time explaining to 
our own colleagues, both sides of the aisle, the effectiveness 
of McGovern-Dole and also how it ties into national security 
issues as well as a feeding program.
    And I couldn't more endorse Mrs. Emerson's comments on 
Cuba.
    With that, Ms. Kaptur.
    Ms. Kaptur. Thank you, Madam Chair.

                         SCHOOL FOOD PURCHASES

    Secretary Vilsack, I would like to ask your help in helping 
me unwind the food purchases of the city of Toledo school 
system and the city of Sandusky, Ohio, school system.
    On pages 27(g)-38 and 39 of your submission, there are 
summaries of what Food and Nutrition Services purchases 
nationally. It is very interesting to look down the list and 
really see the majority of it is processed food, and even the 
amount of fresh tomatoes is so small, it is actually shocking.
    I am one of those people that believes in go local, grow 
local, buy local. Our city school systems cannot tell me--they 
say they cannot report to me what they buy because they report 
it to the State, and then the State buys, and then they report 
it to you.
    So I am wondering, could you help me figure out, of the 
money that we vote for up here for our schools, just in two 
school districts in Ohio, can you find me the numbers of what 
they are buying, how much they are buying and what the price 
they are paying for it is?
    I would like to compare to the list you are submitting 
here.
    Secretary Vilsack. Well, I think that list was from last 
year's budget, but we will try to get you updated information. 
I will tell you that we are obviously very interested in 
increasing, as Congress has instructed us to do, fruits and 
vegetables in those diets.
    [The information follows:]

    The foods purchased by the Food and Nutrition Service (FNS) for 
school systems in Ohio are delivered to four central warehouses located 
in Cincinnati, Cleveland, Dayton, and Columbus and are then delivered 
to the individual school districts. FNS is unable to track the 
shipments beyond the central warehouses, so we are unable to provide 
data specifically for the Toledo and Sandusky school districts. The 
attached spreadsheets provide updated purchase information for FY 2008.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Ms. Kaptur. I am glad to hear you say that. It is a perfect 
lead-in.
    We just had some photos delivered to your staff there. I 
hope they shared them with you. One is of a vertical growing 
system that we are using in the city of Toledo right now, in 
conjunction with our hospitals that are desperately worried 
about the children coming into their emergency rooms with 
rising levels of diabetes and so forth.
    And we need your help in raising consciousness even more 
and not just thinking food stamps are the answer for the city. 
That is almost an insult. And I vote for food stamps, but when 
I look at my district, $100 million a year comes into my 
biggest county for food stamps, say, $100 million, that is more 
money than will come in for CDBG, all these other Federal 
programs. That is the biggest investment program we have on an 
annual basis.
    And it doesn't create fishermen. All it does is tell people 
how to try to spend that money at some outfit to buy nachos or 
Cheetos--sorry to offend anybody out there by a product by that 
name--but in food deserts, there isn't good food. So I am on a 
mission, and my mission is to get our children fed properly and 
to have those communities involved in the production of their 
own food.
    This is not a radical idea. The farm bill of 2008 says your 
mission at USDA is to assist eligible agricultural producers 
and rural small businesses. It doesn't say agricultural 
producers that are located only in the Plains States; it says 
agricultural producers. And if we have youth and others that 
can produce in those pots that are before you in that photo, or 
in those schoolhouses, 12 months out of the year, who are 
hungry, and they don't have good nutrition, how can we say 
``no'' to them? We have to turn these programs to the benefit 
of the American people.
    There is a book out, No Child Left in the Woods, about how 
urban kids are afraid of the outdoors. They love their 
computer. Boy Scouts are declining in membership, Girl Scouts. 
Why? They don't like the outdoors.
    What kind of society are we producing here? We have got 
epidemic levels of ADD, ADHD.
    Children have to be comfortable with nature. They have to 
live in nature. We have taken that away from them. Agricultural 
production is a very important part of life. You know that 
coming from Iowa. So I just wanted to point out the new farm 
bill, the new authorities that are at USDA.
    The First Lady understands this. Many of us up here have 
been talking about it. The staff at USDA needs to understand 
this. You have to serve your Secretary well. There is a new 
farm bill. It has some new focuses. We need to bring that back 
to the American people.
    Thank you for letting me make that statement. I look for 
your help in trying to figure out what the city of Toledo 
school system is buying and the Sandusky school system with 
dollar amounts and volumes attached. It shouldn't be this hard.

                        RURAL ENERGY FOR AMERICA

    Mr. Secretary, I just wanted to point out also, under 
section 9007 on Rural Energy for America, that section does not 
just concern biofuels. Under the new farm bill, that is for 
energy audits, and those energy audits can happen at 
agricultural producers. If they are greenhouse growers, if they 
are landscapers, if they were nurserymen, if they are running 
greenhouses, they should be eligible for those programs; they 
should not be excluded.
    Secretary Vilsack. Those grants are now in the process of 
being awarded.
    May I make just a couple of comments?
    I would ask this committee to do all of us a favor, and I 
know this is going to be hard for you all to do.
    Ms. DeLauro. Try us.

               SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM

    Secretary Vilsack. But we don't have food stamps. We have a 
Supplemental Nutrition Assistance Program.
    Ms. DeLauro. I am there.
    Secretary Vilsack. The reason I say this, it is an 
important message issue here that this is really about 
increasing--it is your point, increasing the nutritional value 
of what our children and our families have.
    The concept of food stamps has, I think, a negative 
connotation that doesn't get to the whole issue of nutrition. 
And so I have been encouraging people in my department to 
really make the transition away from food stamps to SNAP. It is 
a very important message issue.
    There are several guides that we have published recently 
encouraging schools to Eat Smart, a guide to buying and serving 
locally grown produce in schools. It is on the Web. I will get 
you the sites so that you can link it to your Web site. There 
is also one, bring small farms and local schools together.
    So we are cognizant of the changes in the farm bill and the 
direction of the farm bill. We take it very seriously, and we 
are going to continue to do so.
    [The information follows:]

    The Small Farms/School Meals Initiative, popularly called the 
``farm-to-school'' initiative, is based on the cooperation of Federal, 
State, and local governments, as well as local farm and educational 
organizations, and encourages small farmers to sell fresh fruits and 
vegetables to schools and schools to buy this wholesome produce from 
small farmers. Both schools and small farmers benefit from their 
participation in the ``farm-to-school'' initiative. Schools provide 
children fresh, tasty, nutritious produce, while small farmers acquire 
new markets. Schools are able to provide fresh produce quickly and with 
lower transportation costs by buying it from small farmers instead of 
from distant markets. And children learn from farmers who visit their 
classrooms about how the produce is grown and the role it plays in a 
healthful diet, thereby experiencing first-hand in both the classroom 
and the cafeteria the value and appeal of fresh fruits and vegetables.
    The FNS Web site provides a manual that is a step-by-step guide of 
activities for groups to plan, conduct, and publicize a professional 
town hall meeting that encourages small farmers and local school food 
officials to begin a ``farm-to-school'' project. This manual can be 
found at http://www.fns.usda.gov/cnd/Lunch/Downloadable/small.pdf.
    The Eat Smart. Play Hard.\TM\ Campaign was launched by USDA's Food 
and Nutrition Service (FNS) to encourage and teach children, parents, 
and caregivers to eat healthy and be physically active every day. Eat 
Smart. Play Hard.\TM\ offers resources and tools to convey and 
reinforce healthy eating and lifestyle behaviors that are consistent 
with the Dietary Guidelines for Americans and the MyPyramid Food 
Guidance System. Eat Smart. Play Hard.\TM\ is about making America's 
children healthier. Resources are available on the FNS Web site at 
http://teamnutrition.usda.gov/Resources/eatsmartmaterials.html.

    Ms. Kaptur. Madam Chair, I know the time has expired. I 
thank the Secretary.
    Let me just say, the words are great, but at the local 
level where we live, we know it is not rolled out. We know it 
is not happening. It is 1 percent of 100 percent that needs to 
be done.
    So we are glad for the new farm bill. We are glad for the 
sensitivity of the Secretary. But just recognize, when we write 
words in Washington, you know they come down in Iowa always, 
they don't come down in Ohio.
    Secretary Vilsack. That is our job to get them to the 
people. You are right.
    Ms. DeLauro. Thank you, Ms. Kaptur.

                 NATIONAL ANIMAL IDENTIFICATION PROGRAM

    I want to move to a different issue, which is the National 
Animal Identification Program; $142 million expenditure by 
Congress and the taxpayers, an enormous amount of money through 
fiscal year 2009--as I said, $142 million--and we still have no 
meaningful ID system.
    February 2009, APHIS had enrolled about 500,000 livestock 
premises into NAIS. This represents about 135,000 livestock 
premises in the country.
    Last year about this time we discussed this issue with the 
prior administration; NAIS had enrolled 32 percent of livestock 
operations. Twelve months later we have increased by 3 percent; 
this is after 5 years of funding. I think USDA may have crossed 
a line from implementing a voluntary system to a dilatory 
animal ID system.
    Don't take my word for it. This is what Dr. John Clifford, 
APHIS's chief veterinarian, said before the House Agriculture 
Committee not too long ago. This is his opinion, and I quote, 
``The system we have has not worked. Unless we can put enough 
incentives in it for livestock producers to voluntarily 
participate, it needs to be mandatory. The system has to be 
effective, and this is not effective.''
    The consensus is, a new approach, 5 years has not worked; 
tens of millions of dollars, not worked. We have to have a 
better way of dealing with this.
    Mr. Secretary, do you support a mandatory animal 
identification system? I am going to ask you that question.
    My colleague, Congressman Peterson, who heads up the 
authorization committee, has said he will not support another 
dollar for NAIS unless the Obama administration supports a 
mandatory system. In his view, the current system does not 
work; and continuing the Bush policy is a waste of money after 
5 years of the Bush administration's ineffective voluntary 
approach, where the livestock industry had ample opportunity 
for input and for comment.
    I want to get an answer to the question on a mandatory ID 
system.
    Secretary Vilsack. Madam Chair, I am supportive of the 
effort to make sure that we have an identification system that 
will allow us to prevent and/or mitigate problems.
    I would like the opportunity to sit down with those who 
have been opposed to a mandatory system in the very near term, 
to work through whatever difficulties they have from a privacy 
or a confidentiality standpoint, to see, as we structure such a 
program, if we can respond to those concerns. Because my 
concern is that if you have a mandatory system, and you do not 
address those issues in an appropriate way, you can have people 
spending a lot of time and a lot of resources trying to figure 
out how to get around the system.
    What we want is a system that works. We want a system that 
people comply with.
    Ms. DeLauro. I am going to suggest to you, Mr. Secretary, 
we have had a lot of people for the last 5 years trying to 
figure out how to get around the voluntary system.
    Secretary Vilsack. I don't disagree with you.
    Ms. DeLauro. And why? Why should we continue to appropriate 
money for a failed system?
    Secretary Vilsack. I am not suggesting you should.
    I am just saying that when you set up a system, whatever 
system you set up, if there are concerns about privacy and 
confidentiality, we need to address those as we set the system 
up. I would assume that you would agree with that.
    Ms. DeLauro. Well, I would agree with that except that we 
have had ample time in which to do this. This is nothing but a 
continuation of a dilatory tactic.
    And let me just say, in terms of the livestock industry--I 
say it loud and clear to them--what better would protect the 
livestock industry, support U.S. exports, protect American 
consumers, the Bush animal ID system or a mandatory 
identification system?
    I mean, the USDA announced in March 2007 that it was going 
to conduct a cost-benefit analysis for NAIS. Two years later, 
aside from hearing rumors about being completed, we are still 
waiting to learn about the results of this study. Is there an 
analysis? What is the analysis? Is it going to be made 
available to all of us, or are we just going to--you know.
    And we tried to hold back the last time, and we were 
persuaded that we should put, I think, an additional $14 
million in this program, which is in the current appropriations 
bill.
    Why are we throwing good money after bad with an industry 
that doesn't want to move?
    Secretary Vilsack. Madam Chair, I am not disagreeing with 
you. I am just suggesting that--and I have talked to Chairman 
Peterson about this, and he understands, I think, what I am 
talking about, which is basically giving--you go ahead with the 
process.
    I would agree with you that we have to spend these monies 
more wisely and we have to have a system that works, right. But 
what I am suggesting is that I think it will work better if I 
at least have the opportunity to get people around the table, 
have them explain what their confidentiality and privacy issues 
are, and see if there is a way in which, as this system is 
being set up by all of you, that we can address those issues in 
a way that we don't have problems with a mandatory system once 
it is implemented.
    That is my only concern.
    Ms. DeLauro. I am going to say to you, Mr. Secretary, the 
clock is ticking. I don't know how long you are going to need 
to talk to these folks. It should be a very short conversation.
    Secretary Vilsack. Weeks.
    Ms. DeLauro. Five years they have had an opportunity to 
think this through, and $142 million; and we have zero to show 
for it.
    Wisconsin, 100 percent, 100 percent registration. Why? 
Mandatory. I rest my case and my time is up.
    Mr. Kingston.
    Mr. Kingston. Thank you, Madam Chair.
    Mr. Secretary, what did you think of the most recent study 
of powder post beetles in South Carolina? I just wanted to make 
sure you are still with us. That is the only thing, for 
example, I can think of that we haven't covered so far.
    Ms. DeLauro. Not true, Jack.

                        SCHOOL VENDING MACHINES

    Mr. Kingston. Not true at all. I did want to point out 
something on vending machines, that the American Heart 
Association, in association with the William J. Clinton 
Foundation has been studying and working on the vending machine 
issue, which I think we all understand the schools want the 
revenue and we want the nutrition.
    But because of that, the program has already reduced 
beverage calories in school by 58 percent, and 79 percent of 
beverage companies are complying with it. So there is some good 
movement in that direction, and I just wanted to underscore 
that.

                            RURAL BROADBAND

    I wanted to ask, though, about broadband. You know, you 
have the RUS that has the existing program, and now we have a 
new program. I am glad you are talking, but I do think--this is 
a bipartisan belief of this committee--that we want RUS to be 
the lead and continue to.
    For one thing, you have an existing definition of ``rural 
area'' in the farm bill. And would you continue to use that 
same definition, do you know?
    Secretary Vilsack. I think we are working on refining that 
definition. I think the instruction was that we really needed 
to be more specific about what that definition is.
    But as it relates to broadband, I think it is fairly clear 
that what we are focusing on are rural unserved areas, for the 
most part.
    Mr. Kingston. That is one of our concerns, to make sure 
that the money does actually go to rural areas and not areas 
that have figured out a way to get qualified.
    Secretary Vilsack. That is a legitimate concern.
    Mr. Steele. Mr. Kingston, in the stimulus bill it says, at 
least 75 percent of the area to be served by the product shall 
be in a rural area.
    Secretary Vilsack. And it defines it as less than 20,000 in 
population, less than 50,000 in metro area.
    Mr. Kingston. Do you think your modifications are going to 
stray from that definition?
    Secretary Vilsack. Well, I think the definition of 
``rural'' that we are working on actually applies to a broader 
range of programs than just the broadband. So I don't want to 
commit myself to a specific definition, but I will tell you 
that we understand and appreciate what you want us to do, which 
is, you want us to use those resources for broadband in rural 
areas, and you want unserved areas to receive preference, if 
you will; as opposed to areas where they currently have the 
service, and we would just be adding to competition.
    That is my understanding of what Congress wanted us to do. 
Now, if that is not correct, you all need to correct me so I 
can do what you want.
    Mr. Kingston. I actually wasn't in the room, so I don't 
know one way or the other. That is another issue.
    I have some issues on the Animal Medical Drug Use and 
Clarification Act, which we passed, and I want to submit those 
to you for the record and get your comments on them. And I 
yield back.
    Ms. DeLauro. Mr. Farr.
    Mr. Farr. Thank you, Madam Chair.
    Mr. Secretary, I am very excited you are here. This has 
been a long day with this committee, but I think the excitement 
is that you have the ability in this position to take a 
department, which is one of the oldest departments in the 
Federal Government, and probably deals with more different 
areas all the way from commodity exchanges to school lunch 
programs and international trade and so on, and really use your 
skills as a governor and administrator to, hopefully, modernize 
this Department.

                         LOCAL SPECIALTY CROPS

    And one of the things that strikes me--and Marcy brought it 
out in her book--is that if we want to grow the markets that 
you know are necessary--and I represent a lot of specialty 
crops--the markets out there are right in our own backyard. One 
is the farmer's market you mentioned. You can grow that by 
requiring that States issue their SNAP cards, their WIC cards 
and the other vouchers that are given out at those farmer 
markets.
    We do that now in Santa Cruz County where the social 
services department who manages these things goes and 
distributes them there. And I will tell you, 65 percent of the 
income made at that farmer's market comes from those vouchers; 
and, you know, they are buying fresh fruits and vegetables and 
they are buying local stuff.
    The other problem is that we don't--the schools that we 
distribute food to can't go out and buy food locally. They have 
to go through this system that Marcy was talking about. And 
that list that I gave her that she quoted from--and this is the 
list of the Department last year--one of the problems, we talk 
about obesity and everybody is talking about it, and we need to 
do something about it.
    I think you need to shake up your Department. You ought to 
ask them, without any other, How can we shift money to have a 
goal to have a salad bar in every school? And you are going to 
find out all the reasons why we can't do it, but we last year 
spent $90 million on mozzarella cheese, $9 million on peanut 
butter----
    No offense to Mr. Bishop.
    Ms. DeLauro. Mozzarella cheese, I might take offense.
    Mr. Farr [continuing] And we only spent $51,000 on fresh 
tomatoes.
    So our priorities are all in these old commodity programs 
and the processed foods and all of that, and we have to change 
that by radically looking at what we have talked about earlier 
of consolidating all these programs and streamlining them so 
that you have additional revenue to get the fresh fruits and 
vegetables in the schools.
    And I hope that you will stick to that. I know that you 
have done it.
    That is just a statement because, Mr. Kingston--is he still 
here? It is too bad, because Mr. Kingston was talking about 
earmarks; and I would be glad--I want you to look at--I 
represent Monterey and Santa Cruz and San Bernardino Counties. 
We grow 85 crops in Monterey County--it is the number one ag 
county; it doesn't have any subsidies of water or anything like 
that, no commodity crops--85 crops that produce $3 billion in 
sales for one small ag county, and that is the highest in the 
United States.

                      AGRICULTURE RESEARCH STATION

    We can't get that research station, an Ag research station 
built there because we are spending the limited money the ARS 
has on capital outlay, including the $13 million earmark that 
Mr. Kingston asked for for last year to get the poultry 
research facility in Athens, Georgia. That's a $270 million 
project, and it's sucking all the money away from all other 
projects in the country, including getting in Salinas, probably 
the oldest--and I am all for earmarking that.
    But because you've got issues like, you know, cutting-edge 
issues--this is the E. coli breakout, this is the salmonella 
breakout, listeria, this is all the specialty crops, the ones 
that you don't have a kill-step for in order to make sure that 
they're healthy. And we are doing incredible things out there, 
but we really need to invest in that research station.
    So I am for earmarks; and Mr. Kingston says he's not, but 
he certainly has gotten a lot of the money that I would like to 
get to Salinas.
    So those are some observations. And it really is because we 
count on you to look at all these programs and figure out how 
to make the Department be responsive to the demands of modern 
society, and some of these programs are very old and don't meet 
the test of common sense anymore.

               SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM

    Secretary Vilsack. Just one comment. We are working with a 
number of groups to try to figure out innovative and creative 
ways to get people signed up with SNAP. One way, which has been 
working in southern California, in particular, has farmers 
markets issuing coupons to encourage people to come to the 
farmers market. They get a couple extra dollars off a purchase. 
And while they're getting their coupon and standing in line, in 
some cases, for hours, to get a $5 coupon, there is someone 
next to a table which basically says, would you like to learn 
about SNAP? Would you like to learn if you qualify? Are you 
currently receiving assistance?
    So we've seen a rather significant increase in the number 
of people signed up from that kind of strategy. So we're trying 
to figure out ways to expand those kinds of opportunities.
    When 67 percent of Americans who qualify are using the 
program, that means that 33 percent aren't, and we have a job 
still to do to make sure that we address it. And this is one of 
the strategies for reducing childhood obesity. We have to get 
nutritious food in them and in the hands of moms and dads for 
their children.
    Mr. Farr. When the parent qualifies for SNAP, do the 
children also qualify for the school lunch program? I think 
they do automatically, but it would be on a different take.
    Secretary Vilsack. Well, your point is well taken of the 
need to streamline and consolidate those programs in the 
eligibility requirements and the processing of it. But that 
requires modern technology, and we need your help.
    Ms. DeLauro. I have to deal with Mr. Kingston, who is not 
here. But Congressman Kingston, as I am told here, did not say 
he was against earmarks. He said he was against executive 
branch picking a congressional earmark which it asked for it on 
its own. So in fairness to the absent ranking member, let me 
place that on the record.
    Mr. Bishop.
    Mr. Bishop. Thank you very much.

                         INFORMATION TECHNOLOGY

    Along with the technology request, over the past 3 years 
our subcommittee has provided significant funds and resources 
to address the Department's technology challenge. My question 
is, when can we expect a return on that investment to get 
improved service delivery and efficiency? That's the first 
question.

                     MEXICAN TRUCKING PILOT PROGRAM

    The second has to do with--on a different subject--Mexican 
trucks. Since the Mexican Government has proposed a retaliatory 
tax on U.S. agriculture going into Mexico as a result of the 
ending of the Mexican trucking pilot program, tell me what the 
status of the discussions are with the Mexican Government in 
that regard.
    Those two questions.  You have been helping with the 
technological challenges there.
    Secretary Vilsack. I was trying to figure out precisely how 
to respond to your question in terms of time.
    We are expecting that there will be a prototype--it was a 
3-year program, a 3-year plan to develop a prototype that in 
turn could be tested and then determine whether or not it 
actually provided the kind of service that we need it to 
provide. That is in the works, and we should be seeing that 
prototype relatively shortly.
    Mr. Bishop. That includes interoperability--or 
communication, rather, between the agencies.
    Secretary Vilsack. Right. And that also sort of dovetails 
with the whole broadband initiative, which it doesn't do much 
good if the farmer service office has got the technology but 
the farmer can't utilize it because he doesn't have access to 
the Internet or high-speed Internet. So we are working on both 
ends of that problem.
    I have not had an opportunity to speak specifically to the 
Trade Representative or to the Secretary of State about 
discussions relative to the Mexican trucks. My conversations 
with Mexican officials have been primarily focused on COOL and 
the implementation of COOL, which I am happy to visit with you 
about if you want. We have offered assistance to DOT and 
Secretary LaHood. We will have to get back to you in terms of 
what they can tell us, the discussions that have taken place.
    [The information follows:]

    The President has assigned the Department of Transportation to work 
with the U.S. Trade Representative and the Department of State, along 
with leaders in Congress and Mexican officials, to develop proposed 
legislation creating a new trucking project that will meet the 
legitimate concerns of Congress and our NAFTA commitments. That process 
is ongoing. The Department of Agriculture will work with the 
Transportation Department and other agencies in the preparation of the 
proposal.

    Mr. Bishop. Thank you.
    Ms. DeLauro. Mr. Davis.
    Mr. Davis. I want to follow up on a couple of comments that 
have been made.

                         ANIMAL IDENTIFICATION

    Country of origin labeling. The area I am from, we have 
some support from that. Animal ID becomes a more difficult task 
for some of us in some of the rural areas to absorb and 
swallow. I wasn't certain your position on that. Are you taking 
the position that animal ID will be a part of this new 
administration's efforts?
    Secretary Vilsack. I believe it has to be, and here's why. 
One cow caused a rather significant problem with the market not 
so long ago. And I am concerned, from a homeland security 
standpoint, of what could potentially take place if we don't 
have a system that would allow us to identify and mitigate 
consequences of terrorism activity or of a disease or some 
problem with livestock.
    Having said that, I understand and appreciate that there 
are some areas of the country where this is problematic, which 
is why I have suggested to the Chair that I want the 
opportunity to sit down with folks and work through--and I 
appreciate that you all have been talking about this for 5 
years, but I think the circumstances are a little different 
now. And I think there has been clear indication from the Chair 
and from the Chair of the Ag Committee that there is a real 
interest in this, and that may change attitudes about this.
    I want to work with the industry to make this work. Because 
what I don't want is for a law to pass, for us to have on the 
books a mandatory system, and then have everyone spend a 
tremendous amount of time and effort to try to figure out how 
to get around it because they have concerns about how the 
information is going to be used or where it's going to be used. 
I think we can address those problems.
    Mr. Davis. As a side comment, we've had a whole lot more 
difficulty with peanuts, a whole lot more difficulty with 
fruits and vegetables tainting our fruit supply than we have 
necessarily from animals.
    Secretary Vilsack. I don't disagree that that's the past. I 
am also concerned about the possibility of the future.
    When I was Governor, I remember coming to Secretary Ridge 
and asking him to set up an agri-terrorism aspect of Homeland 
Security because I believed that that was one way that you 
could create real serious problems for this country is if the 
food supply was compromised. So I am interested in making sure 
that we protect it as best we can, and I think everybody shares 
that goal.
    Mr. Davis. And the second comment was, I really hope that 
we work together.

                     INFORMATION TECHNOLOGY EFFORTS

    Ms. DeLauro. Let me just say, Mr. Bishop mentioned the IT 
effort. You should know, Mr. Secretary, that you have both 
sides of the aisle on this committee that is enormously 
supportive of just the whole reformation of information 
technology. We have been appalled at how far back we are at the 
Federal level, not only here at USDA but in other areas as 
well, with information technology and how agencies communicate 
with one another. So that you have real support in this 
committee to move forward with that effort and to let us know 
what is going on.
    I will just say, we have been in the dark about what 
happens, how it happens, what the contracts are. We have spent 
money here where we find out after it's implemented that one 
agency still can't talk to another agency after spending 
millions of dollars to do something. So you have real support 
here in trying to make your systems work. Because they work for 
farmers, they work for ranchers, they work for school systems, 
they work everywhere in which we have jurisdiction here. So you 
just need to know that.
    Secretary Vilsack. I am remiss in not thanking you for the 
work that you have done, and it is appreciated.
    Ms. DeLauro. That was a vote. And I would love to say that 
people are going to come back--and you would probably kill us 
if we did that, but, in any case----
    Secretary Vilsack. I am happy to stay here.
    Ms. DeLauro. I know that. Thank you very much.

                SUPPLEMENTAL REVENUE ASSISTANCE PROGRAM

    I want to ask a question about the Agriculture Disaster 
payments and any delays in those payments or potential delays.
    With the Permanent Disaster program in the farm bill, the 
Supplemental Revenue Assistance Program, in your testimony you 
said you are currently reassessing the regulatory and software 
development efforts in light of the changes enacted by the 
Economic Recovery program. Let me tick off the questions: What 
did you mean by the statement? What regulatory and software 
changes are necessary after the enactment of ARRA? Will the 
changes delay the delivery of the first SURE payments, and will 
they delay your promulgation of regulations?
    You went on to say, we are on track to issue regulations by 
November, 2009, well ahead of the date when the data will be 
available to calculate payments.
    I was a little confused by the statement. My understanding 
was that USDA had hoped to issue the first SURE payments for 
the 2008 crop year sometime this fall. It appears that that has 
slipped, and you may not deal with those payments until this 
winter, at the earliest. When will USDA issue the first SURE 
payments? Let me ask you to comment.
    Secretary Vilsack. The statutory price discovery mechanism 
and the interrelationship with other USDA programs make it 
difficult for us to calculate the SURE payment for crop year 
2008, so we don't expect the rules to be available until 
September of 2009. The information I have is that we won't 
expect payments until sometime in 2010.
    Ms. DeLauro. So you won't be making any of those payments 
until 2010. Wow. I mean, I think there are going to be--I think 
that that's real news to folks, Mr. Secretary.
    Secretary Vilsack. Well, in the Recovery Act you created 
multiple benefit options for producers, which makes it 
significantly more complicated to calculate. And it's a 
software issue.
    Ms. DeLauro. Well, I also understand the administration 
supported the language, the efforts in the economic recovery 
package.
    Secretary Vilsack. Well, I can do this, Madam Chair. I can 
go back and see if there is any way in which this process can 
be accelerated. We understand and appreciate how significant 
this is, but we are somewhat hampered by the software 
development. I will have to find out if there is any way we can 
find out----
    Ms. DeLauro. Well, we should really keep in close touch on 
this issue. Because a lot of members of the committee are very 
interested, and there are a lot of Members who are interested 
in what's going to happen here, and we want to make sure that 
we are moving as quickly as we can.
    Secretary Vilsack. We will follow up.
    [The information follows:]

    The American Recovery and Reinvestment Act (ARRA) of 2009 (P.L. 
111-5) made several changes to the permanent disaster programs, 
primarily the Supplemental Revenue Assistance (SURE) Program. It 
provides a waiver for the 2008 crop year for producers who did not 
purchase crop insurance or non-insured crop disaster assistance and 
failed to timely pay waiver fees authorized in the 2008 Farm Bill. It 
increases the minimum coverage level for SURE guarantees for producers 
who buy-in under this extended waiver authority. It allows previously 
eligible SURE producers to elect to receive benefits under multiple 
payment options. It establishes a new risk management purchase 
requirement for producers who elect to pay the waiver fee authorized in 
the ARRA. FSA will need to make extensive regulatory and software 
modification to implement these new requirements.
    The changes are not expected to delay the delivery of the first 
SURE payments; however, they will delay our promulgation of 
regulations. Prior to the enactment of the ARRA, we now anticipate 
publication to be in November 2009. Sign-up for SURE is expected to 
begin in January 2010 and payments are expected to begin in June 2010. 
We are examining options to expedite the payment process; however, due 
to the complexity of the SURE program, its statutory price discovery 
mechanisms, and inter-relationship with other USDA programs that may 
not be possible.

    Ms. DeLauro. I don't know if there are any more questions 
or comments.

                   FARM SUBSIDY PAYMENTS TO POLLUTERS

    I am going to submit for the record, just so that you know, 
I have questions about farm subsidy payments to those who are 
polluting. There is a raft of evidence that's out there that 
talks about subsidy payments to polluters and people who are 
paying enormous amounts in fines; and, at the same time, we are 
providing them with subsidy payments for their land.
    You also had a former administration person who talked 
about these two things ought to be separate. If you pollute the 
land, that shouldn't preclude you from being able to get a 
subsidy. But it seems to me that if you violate State and 
Federal environmental quality laws, you cost the taxpayers 
twice in that instance. But we will submit that for the record.
    I had questions about what at least seems to me to be 
mismanagement at USDA on NRCS and programs with regard to NRCS.
    But, again, you have been very, very generous with your 
time.
    Secretary Vilsack. Madam Chair, to that point, there is an 
audit of NRCS; and we are spending resources and time to try to 
address all deficiencies.
    Ms. DeLauro. There are serious problems at the agency, 
there really are. And I, again, want to solicit your views, the 
steps that we're taking, all of that to move forward, but it 
requires more time to flesh out.
    I also have questions about FAS and some of the issues that 
are attendant to that. But, as I say, I will submit the rest of 
my questions for the record and ask my colleagues to do the 
same.

                            closing remarks

    Thank you for your generosity of time.
    I will just say, there are a lot of questions. You've been 
on the job a short period of time. We are very, very aware of 
this. But I think it's important to lay out what some of the 
questions are.
    One of the other questions, by the way, I am going to ask 
for the record is the names of the countries on press releases 
about recalls of imported products.
    Secretary Vilsack. And we will do that.
    Ms. DeLauro. Okay. Thank you very, very much.
    But you've been there a short period of time. But laying 
out questions for so long on both sides of the aisle here, we 
have been stonewalled from the agency on lots of questions that 
led to this committee, again, both sides of the aisle, just 
saying, you know, hey, you're not going to answer our 
questions, you're not going to provide us with the information? 
We're an Appropriations Committee. Let me tell you what we're 
going to do.
    We look at this as a new day, new dawn, new environment. 
Tough questions from both sides but with an interest that are 
your interests in order to address the issues in the everyday 
lives of folks which this subcommittee and your department have 
an enormous sway over what happens.
    So we look forward to working with you, and thank you again 
for the generosity of your time this morning and your candor 
and clarity on answers. Thank you very much.
    Secretary Vilsack. Thank you.

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
                                         Wednesday, April 22, 2009.

                    TESTIMONY OF MEMBERS OF CONGRESS

     APPROPRIATIONS FOR LAND GRANT INSTITUTIONS IN THE TERRITORIES

                                WITNESS

HON. MADELEINE Z. BORDALLO, A REPRESENTATIVE IN CONGRESS FROM THE 
    TERRITORY OF GUAM
    Ms. DeLauro. In the absence of a gavel, I will use my pen, 
but the hearing is called to order. I want to thank you. And 
let me just say welcome, everyone, here this morning, and 
particularly I want to say a welcome to my colleagues.
    Just so that we put it in context here, the hearing is a 
new future of the Appropriations Committee's process. And the 
view is that it could provide an excellent opportunity for 
Members to share their priorities with the subcommittee, and 
the hope is that in an effort to deal with transparency, but to 
increase transparency of this process. So I am looking forward 
to hearing firsthand from you about your communities and what 
are the issues that are of interest.
    Let me ask colleague Tom Latham if he has any comments to 
make.
    Mr. Latham. No, I really don't. I just welcome our 
colleagues here, and thank you.
    Ms. DeLauro. Okay. We have Congresswoman Madeleine 
Bordallo, now in her fourth term representing Guam. She joins 
us from the Armed Services Committee and from the Natural 
Resources Committee.
    Congressman Gregorio Sablan, who represents the Northern 
Mariana Islands, serves on the House Natural Resources 
Committee and Education and Labor. And Congressman Sablan is in 
his first term and the first Northern Marianas Representative 
in the U.S. Congress.
    Welcome to both of you. Let me just ask you to move forward 
with your testimony, and we welcome it. And, you know, 
obviously, if there are questions, we will ask some questions. 
But thank you again for being here.
    And let me also welcome Congresswoman Jo Ann Emerson from 
Missouri, who sits on the subcommittee as well.
    Congresswoman Bordallo.
    Ms. Bordallo. Good morning, Madam Chairwoman DeLauro and 
Ranking Member Mr. Latham. First, I want to thank you for 
allowing us to be the first to appear before you, since we have 
other commitments this morning.
    I came here today to underscore the importance of this 
subcommittee in providing funding in fiscal year 2010 for the 
programs that are specifically authorized to support the land 
grant institutions in the territories. And I am joined this 
morning by my colleague, Congressman Sablan.
    We have filed joint requests with Congressman Faleomavaega 
of American Samoa, Congresswoman Christensen of the Virgin 
Islands, and Congressman Pierluisi of Puerto Rico, who, like 
us, are contending with a markup session in the Committee on 
Natural Resources this morning. So I appreciate your 
forbearance as I must leave at the conclusion of my remarks to 
attend that markup session.
    This year, Madam Chairwoman, we request that $1.5 million 
be appropriated for the Resident Instruction Insular Grants 
Program, which received $800,000 in last year's bill; second, 
that $8 million be appropriated for the Facilities and 
Equipment Insular Grants Program; and third, that $5 million be 
appropriated for the Distance Education Insular Grants Program.
    Now, each of these three programs have been authorized by 
Congress in recognition of the unique needs of the land grant 
institutions in the territories and the disproportionately 
small amount of Federal funding that they have historically 
received.
    This subcommittee has funded the Resident Instruction 
Grants Program, first authorized by the 2002 farm bill, for the 
past 5 years. And while the House has traditionally supported 
this program, without representation of the territories in the 
other body we have not faired so well in the conference 
process.
    The institutions in the territories were designated as part 
of the land grant system in 1972 by an act of Congress. And 
these institutions, however, are generally classified and 
treated by USDA as members of the greater 1862 community of 
land grant colleges and universities. That means our 
institutions have to compete with more established, greater 
resourced, and more competitive flagship land grant 
institutions in the United States mainland for limited Federal 
dollars, and thus, in part, the reason for our request this 
morning.
    The unique needs and the underdeveloped capacity of the 
institutions in the territories were acknowledged by USDA in a 
report that the Committee on Appropriations requested in 2003.
    The institutions in the territories are working today to 
strengthen their capacity and ability to train professionals to 
meet the need for food and agricultural scientists and 
specialists in our island communities. Each of our institutions 
are also making the most use of limited and at-risk funding to 
continue extension initiatives aimed at sharing research-based 
knowledge and education with stakeholders in our community that 
ultimately is improving the quality of life and, in particular, 
public health.
    Our institutions also comprise the Caribbean and Pacific 
Consortium, or the CariPac. This consortium was established in 
2005 during the first year the Resident Instruction Grants 
Program was funded to support collaboration.
    Now, with the Resident Instruction funds that have been 
appropriated to date, these institutions are preparing students 
to achieve their own personal career goals and increasing the 
quality of undergraduate instruction. The University of Guam--
and, incidentally, Madam Chairman, the university is now headed 
by my predecessor, Dr. Underwood, who is now the president. The 
University of Guam, for example, has built the infrastructure 
needed to begin transmitting both real-time distant education 
courses and platform-based distant learning and delivery 
systems.
    High school mentorship programs have also been established, 
and undergraduate and graduate scholarships are also being 
offered.
    The amount appropriated each year for the Resident 
Instruction Grants Program, however, must be increased if we 
are to take this success to the next level. So attached to my 
written testimony is a chart outlining the education outcomes 
that each institution achieved with the funding provided to 
date. And I think you all have this chart.
    Each of our territories is also contending with declining 
revenues and budget deficits. Providing at least $1.5 million 
for the Resident Instruction Grants Program in this year's bill 
will enable our institution to continue attracting and 
supporting undergraduate and graduate students in the 
agriculture, food and nutrition, and animal sciences.
    Second, I cannot emphasize enough the demonstrated need in 
the area of facilities and equipment improvement for our land 
grant institutions in the territories. Last year, Congress in 
the farm bill authorized a new grants program to address these 
needs.
    Very quickly, I want to highlight the most pressing 
infrastructure need at the University of Guam. In addition to 
the program request, I have also requested an appropriation in 
the amount of $750,000 within either the Agricultural Research 
Service or the CSREES account to upgrade its shrimp and tilapia 
hatchery facility. The original hatchery building was 
constructed over 30 years ago, has gone through nearly 25 
typhoons, and was recently condemned by structural engineers.
    And, Madam Chairwoman, on one of my recent trips, I did 
tour that facility, and it is in terrible shape. It previously 
housed shrimp and tilapia tanks for shrimp genetic replications 
and chillers for marketing to local, regional, and 
international stakeholders. And without this building at the 
University of Guam, the research facility, graduate students, 
and stakeholders are seriously crippled. And the pure genetic 
stocks that have resulted from up to a decade of replication 
will be lost. So the funds I have requested will help the 
University of Guam to rebuild this particular facility.
    Now, finally, I cannot come before the subcommittee without 
also addressing the request I have submitted for an 
appropriation in the amount of $100,000 within the accounts for 
Natural Resources Conservation Service for the next phase of 
planning for the Northern Guam Irrigation Project.
    The project received $100,000 in a discretionary award in 
2006, but it awaits further funding. And this project will 
provide adequate, consistent, and affordable agricultural water 
to farmers in northern Guam, most of whom live at or below the 
poverty level and face inadequate irrigation water supply due 
to the deteriorated pipelines and inadequate source development 
to keep up with increased farm and domestic demand.
    So, Madam Chairman and Ranking Member, I thank you very 
much, and members of the committee, for your consideration of 
all my requests and for your time.
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    Ms. DeLauro. I understand the urgency for you to get off to 
a markup. Let me just ask a couple of questions, and I will ask 
my colleagues if they have questions.
    With regard to the grants for the insular areas, give us 
the on-the-ground sense of what this does in terms of your land 
grant institutions. How does it strengthen what they do?
    Ms. Bordallo. Well, it certainly has been a success up to 
this point. But, as we grow, there is a need for additional 
funding.
    One of the things I want to mention, Madam Chair, is we, 
like any other minority area, along with the CNMI, health is 
very important to us. And for this reason, we have to increase 
farming. We have farming, you know, that goes on 365 days of 
the year; we don't have any seasons. And so I feel that it is 
very important that we increase these very important projects.
    Ms. DeLauro. Do all three programs that you mentioned--not 
the $100,000 and the $750,000, the others--what is their 
relationship to one another?
    Ms. Bordallo. Oh, they are partners, yes. And let me 
mention, too, more heavily we rely on Federal funds for some of 
these funds. Without it, locally we just could not continue.
    Ms. DeLauro. And a question on the irrigation project: What 
is the benefit of that project to the communities that you 
represent?
    Ms. Bordallo. Well, right now, you know, our water system 
and all is very inadequate. It is antiquated. We just have to--
and the farmers rely on, you know--they would like irrigation 
put in. None of them have it, so they are doing their own 
watering and trying to work their crops.
    And another thing I want to point out is nearly 80 percent 
of the faculty is funded on the USDA budget, too. So that is 
another important aspect.
    Ms. DeLauro. Do you know what the funding is going to be 
specifically used for? And what is the sense of the overall 
total project cost, ultimately, for this? Do we know?
    Ms. Bordallo. $1.3 million is the total cost.
    Ms. DeLauro. $1.3 million is the total cost.
    Ms. Bordallo. And I want to mention, too, that, you know, 
with the irrigation system and some of this that the funds 
would handle, right now farmers have no water at all.
    Ms. DeLauro. At all.
    Ms. Bordallo. No, none whatsoever. And we have been talking 
about this for years. And we do have droughts on Guam, believe 
it or not. We have the rainy season and the dry season. And 
that is when we are really affected.
    Ms. DeLauro. Thank you, Congresswoman Bordello.
    Let me ask my colleague, Mr. Latham. 
    Mrs. Emerson. I have a question.
    Ms. DeLauro. Mrs. Emerson.
    Mrs. Emerson. Thank you for being here today.
    I have a very quick question. I would like to know, with 
the shifting of the Marine base and the additional people that 
suddenly the thousands and thousands of people that will 
actually be housed on Guam, don't you think--I mean, that is 
going to put a lot of pressure on already existing systems. So 
it seems to me that the land grant universities and not only 
doing the research but also enhancing the water systems and the 
like should help exacerbate some of the challenges you all are 
going to face with suddenly having all of these thousands of 
additional bodies on the island. Is that correct?
    Ms. Bordallo. The number we are looking at in the buildup 
is about 30,000. And certainly that is an impact in any 
community. There are 8,300 Marines and their families, which 
totals 20,000. And then we have enhancing the Air Force, the 
Navy, and the Army we are bring in. So, yes, very definitely.
    Now, they are looking at the water system, because one of 
the contentions of some of the people are, are we going to have 
outside help? Is everything going to be inside the fence, or 
are they going to help us outside? And, yes, they are. They are 
looking at our power; they are looking at our water systems. 
But, again, that won't help the farmers.
    Mrs. Emerson. No, but I should think that you would have a 
lot of impact on the farmers and the necessity for the farmers 
to be able to further and better develop their techniques and 
their best practices for production purposes.
    Ms. Bordallo. Absolutely. Absolutely. Right now, we don't 
have any export in Guam. You know, farmers just--they raise 
crops, fruits and vegetables. There is a law, a local law, that 
they provide the fruits and vegetables for our students in 
school. But above and beyond that, we can't--now we have the 
Federal schools, the DOD schools, and we don't have the amount.
    Mrs. Emerson. So your request would definitely enhance your 
ability to provide fresh fruits and vegetables for those 
30,000-plus new people.
    Ms. Bordallo. Absolutely. Absolutely, Congresswoman.
    Mrs. Emerson. Okay. Thank you.
    Ms. DeLauro. I just have a quick question, because I am 
interested in the distance learning piece, which I am a strong 
supporter of distance learning, which is a tripartite piece 
here.
    Just overall, in terms of the insular areas and the need 
for distance learning, can you just spend a second on talking 
about that need?
    Ms. Bordallo. Well, probably the most important aspect of 
it is it enables us to partner with mainland universities.
    Ms. DeLauro. Okay.
    Ms. Bordallo. I think that is--and I don't know if the 
Congressman has any further comments on that.
    Mr. Sablan. Oh, Guam is very lucky, Chairwoman. She only 
has one island; I have 14.
    Ms. DeLauro. You have 14 islands, yes.
    Mr. Sablan. And this spans the length of California or 
almost the West Coast.
    Ms. Bordallo. Three inhabited.
    Mr. Sablan. But we do have that communication problem in 
between the islands.
    Ms. Bordallo. And another point, too, on that same 
question. It makes most use of taxpayer funds, and we can tap 
into national successes. So it is very important. We are 
becoming--even though we are 10,000 miles from Washington, 
D.C., 22 air flight hours, we are becoming closer and closer 
because of some of these programs and so forth.
    Ms. DeLauro. Well, that is the advantage of distance 
learning and its abilities.
    Mr. Latham.
    Mr. Latham. I just wondered, with the influx of military, 
have you talked to the Department of Defense appropriation--or 
Defense Appropriations Subcommittee? Are there plans from the 
military to improve facilities over and above this?
    Ms. Bordallo. Oh, yes. It is a $14 billion move from 
Okinawa. And everything will be new--housing, so forth. They 
will be partnering with the local government on power. The dump 
sites will be used by both; water lines and so forth; and 
highways, highway money. So we are partnering because the local 
community is very concerned about that. So ``yes'' to your 
question.
    Mr. Latham. Okay. Thank you.
    Ms. DeLauro. Mr. Alexander, do you have any questions of 
the witness?
    Mr. Alexander. No, no.
    Ms. DeLauro. Thank you very much, Congressman Bordallo. As 
I say, I appreciate your willingness to stay for questions. And 
if we have more, obviously we will be in touch with you and 
with your staff, and I know you will be in touch with us.
    Ms. Bordallo. I just wish, Madam Chairman, that we would be 
able to have other hours for meetings other than 10:00 and 
2:00. It seems that we have so many, you know, problems with 
the timing here. So I would very much like to stay, but I do 
have----
    Ms. DeLauro. No, no, no, I understand. And, again, thank 
you.
    Let me ask Congressman Sablan to present his testimony.
                              ----------                              

                                         Wednesday, April 22, 2009.

     APPROPRIATIONS FOR LAND GRANT INSTITUTIONS IN THE TERRITORIES


                                WITNESS

HON. GREGORIO KILILI CAMACHO SABLAN, A REPRESENTATIVE IN CONGRESS FROM 
    THE NORTHERN MARIANA ISLANDS
    Mr. Sablan. Thank you, Madam Chair and Mr. Latham, Mrs. 
Emerson and Mr. Alexander. Thank you for having us here this 
morning. I ask, if I may, that my statements be inserted in the 
record as if read in full. I want to try and shorten this.
    Ms. DeLauro. Thank you.
    Mr. Sablan. Thank you for having us. And I join Mrs. 
Bordallo, on behalf of our colleagues, to highlight our joint 
request for appropriations for resident instruction, facilities 
and equipment, distance education grant programs that 
authorized by the Food Conservation and Energy Act of 2008 for 
land grant institutions and territories.
    The insular programs, as they are generally known, are 
important means through which the Department of Agriculture 
helps address the unique and growing needs of this set of 
underserved, underdeveloped, minority-serving institutions.
    I want to bring up three items. Mrs. Bordallo was able to 
discuss the land grant, but I have two other issues that I 
would like to bring: the Kagman Watershed and the Garapan 
Public Market.
    Kagman has one of the richest soil in the entire Northern 
Mariana Islands, and they get about an hour of water maybe 4 or 
5 times a week, if they are lucky. And so a lot of it depends 
on the rain. And the watershed, since 1993, 16 years, the 
Natural Resources Conservation Services have began working on 
the Kagman Watershed Project. And it is authorized, the project 
is authorized, and it just needs funding. We have been having a 
difficult time funding it.
    And the purpose of the project is to reduce flooding of 
agricultural land and public roads by collecting the runoff 
from the mountainsides above the peninsula. And the water needs 
to be collected in a reservoir and then distributed to farmers 
for irrigation. There is about 3,750, almost 4,000 acres of 
Kagman land, and the area is intensely farmed for vegetables.
    We import a lot of our vegetables from California. And they 
are great, they are great vegetables. It is just that the time 
it takes to get there and the cost of shipment is very 
exorbitantly expensive to ship from the West Coast to Saipan. 
And with this we could control some of this erosion and provide 
more water for the farmers, because the farmers are beginning 
to produce. And they do contribute to school lunch programs; 
they do contribute to horticulture, military right now. And 
then we will be contributing to the military buildup and the 
commissaries on Guam.
    The second project that I have brought up is the Garapan 
Public Market. Here in Washington, D.C., you have the Eastern 
Market. I am sure in each of your districts you each have 
markets. And, even in Guam, they have their own markets. For 
the Northern Mariana Islands, at the present time, they have 
canopies.
    They put up, erect tents. And they do it on a Thursday 
night at a certain place, on a Saturday at a certain place, on 
a Tuesday night. These are things they put up for a couple of 
hours and then sell their produce and then take it down. There 
is no running water, there is no sanitation. We would like to 
establish this, because this is where they sell not just 
produce but they also sell agriculture.
    I just came from the Northern Mariana Islands. The mayor of 
Tinian started a seaweed and an abalone project, to grow these 
things, so we don't have to buy them from Asia. Right now we 
are buying them from Asia. And the market will give everybody 
an opportunity to come together, have sanitized a place where 
they come in and probably have chills and those kind of stuff 
to store fish so that they don't spoil as often and they are 
more fresh. And so I am asking for that also.
    And, again, I attach myself to Mrs. Bordallo's testimony on 
the issue of land grants. And I would be happy to answer any 
questions that you may have.
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    Ms. DeLauro. I just have a quick question. The $2.3 
million, will that complete the watershed project?
    Mr. Sablan. No.
    Ms. DeLauro. What is your sense of--what will this get you, 
in terms of this project, in making this area valuable?
    Mr. Sablan. This will be the waterway phase. There are 
other things: the reservoir and sediment basin for another $2.8 
million, and $900,000 for the pump and transfer pipeline.
    One of the advantage, also, we need to do this, is that 
some of the soil is eroding into the ocean, and it is causing 
problems in the corals.
    Ms. DeLauro. Right. It is a viable agricultural production 
now, and so we want to try to increase and enhance its ability 
to do this, rather than dealing with shipping from California.
    Mr. Sablan. Very much so. It would increase production.
    Ms. DeLauro. What do you grow? What is growing?
    Mr. Sablan. Everything from tapioca to sweet potato, leafy 
vegetables. We don't have very good carrots. Some of our 
produce are local. I mean, and jicama, you know, melons, 
cucumbers, you know, all the good stuff that I don't really eat 
as often as I should, but the good stuff. And right now they 
are imported. Bananas are grown, but many people have their own 
bananas, but they are grown there. But many people have bananas 
in their backyard. I think I am the only one who doesn't grow 
bananas, but I have neighbors and relatives I can ask them for 
it. But, really, all the stuff that are needed are sold at the 
market.
    Mr. Bob Jones just took over this one market on Saipan. He 
opened it last Thursday, and I was invited to it. And almost 
half the store are reserved for fresh produce because Mr. Jones 
doesn't want to import produce from the States. And he took out 
several farmers. Mr. Tony Pellegrino, who is now getting the 
farmers together--there is a farmers cooperation, association. 
He is getting them together. He is doing the set-up for when 
the military comes into Guam. He is starting already. But he is 
going to do it on a larger scale, where he is going to collect 
all this produce and bring them to the military, the 
commissaries on Guam.
    And so we are looking forward to all these things. It not 
just encourages production, but not just for our own--I prefer 
that it be encouraged for our own food right now so that we 
don't need--but it also has an opportunity for helping out with 
the military buildup in Guam.
    Ms. DeLauro. Just for my own information, to help my 
colleagues, there are 14 islands?
    Mr. Sablan. Yes, there are. There are two active volcanos. 
The other one just erupted last week again. But there are 14 
islands that stretches about the length of California almost. 
The last island is very close to Iwo Jima. Some of these 
islands are preserved, so no one is allowed on them unless you 
are a scientist.
    Ms. DeLauro. Is it preserved for marine life?
    Mr. Sablan. It is preserved for nature, just preserved.
    The islands, there are actually seven islands that are 
inhabitable, except that it just gets costly, so people move 
down. There are no infrastructures. At one time, there were a 
lot of people staying up there for copper production, but the 
price of copper came down, so people moved back down to the 
districts. The schools are there; they want their children to 
finally have education and all these things.
    But just imagine, going from Guam--you have an idea where 
Guam is? The islands stretch out, and the furthest north 
island, which is also a preserve and is now part of this 
national monument that the President just declared, is very 
close to Iwo Jima. And great islands, beautiful islands. Some 
of them have dolphins. I used to scuba dive, and have dolphins, 
some of them. Beautiful, beautiful islands.
    Ms. DeLauro. As Mrs. Bordallo said, there are three that 
are habitable?
    Mr. Sablan. Three have major populations. The other islands 
do have, but they are not large. And, really, I think all of us 
should go out one of these days.
    Mr. Latham. I think we should do a CODEL.
    Ms. DeLauro. I like it. I like it.
    Mr. Sablan. I knew you guys were my best friends today.
    Ms. DeLauro. I am sorry, as I say, because I will be honest 
with you, I don't know much.
    Mr. Sablan. It is really far from Connecticut.
    Ms. DeLauro. How about Iowa? I bet it is different than 
Iowa and Louisiana, as well.
    Mr. Latham. It is just like Iowa.
    Mr. Sablan. But we really have needs. Our government is 
struggling. We depend on tourism, basically, now.
    Ms. DeLauro. Is that what it is? It is tourism?
    Mr. Sablan. Yes. And the drop of the won, Korean won, they 
are just not coming. Japan has their own financial 
difficulties; they are just not coming. Tourists from the 
United States, you know, it is so far away. We get a few 
tourists. We are getting Russians, and they are really 
excellent tourists because they spend a lot of money. But that 
may stop on November----
    Ms. DeLauro. But is it mostly agriculture?
    Mr. Sablan. No, it is mostly tourism. There is fishing, but 
most fishing is just subsistence for now.
    Ms. DeLauro. Okay. Thank you. I don't have any more 
questions. Thank you very, very much.
    Mr. Latham. Why would the tourism stop on November 28th?
    Mr. Sablan. Well, the Russian tourists, because under the 
new visa waiver program--the federalized immigration system 
starts on November 28th, unless we get Homeland Security to see 
where we are coming from. But we are hopeful.
    Mr. Latham. Thank you.
    Ms. DeLauro. Thank you very, very much. Thank you for 
coming by. Appreciate it.
    Mr. Sablan. Thank you for having me.
    Ms. DeLauro. I am going to ask Congressman Hall to join us. 
Congressman John Hall is in his second term and represents New 
York's 19th District, serves on the Transportation and 
Infrastructure Committee, Veterans' Affairs, the Select 
Committee on Independence and Global Warming.
    Welcome to you, Congressman Hall. And obviously your entire 
statement will be in the record, and you can summarize or you 
can as you choose.
                              ----------                              --
------

                                         Wednesday, April 22, 2009.

                           NEW YORK PROJECTS


                                WITNESS

HON. JOHN HALL, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW YORK
    Mr. Hall. Thank you, Chairwoman DeLauro, Ranking Member 
Latham, Representative Alexander, for inviting me to appear 
before you today. And I would be happy to arrange a CODEL to 
Orange County, New York, the home of West Point as well as the 
Black Dirt region, where the soil is so dark and rich that it 
is darker than the top of this table.
    One of the requests that I have submitted to your committee 
is about the Black Dirt region, which has acres upon acres of 
this extremely fertile muck soil, used to produce onions, 
potatoes, and other specialty crops. In July of 1997, a severe 
hailstorm struck 2,500 acres of onion fields in the Black Dirt 
region. Scores of onion leaves were damaged, allowing water and 
bacteria to seep deep into the heart of the plants.
    Farmers in my district asked the USDA for permission to 
destroy their crops but were told that, under existing crop 
insurance policies, it would only be considered a sound farming 
process to care for the crop and bring it to harvest. Orange 
County's onion growers were forced to finance multiple 
pesticide applications and weeding, harvest preparation, 
grading and packaging for crops that wound up to be 
unmarketable.
    The USDA reversed their policy in late September of 1996 
and then gave the onion growers permission to destroy the 
onions in the field, which would have allowed them to replant 
during the same season. At that point, however, the vast 
majority of our farmers had already completed the harvest, 
spent large amounts of capital caring for rotten crops. And, as 
a result, growers in the region were forced to seek funding 
through large USDA loans to survive.
    In order to provide assistance to these already financially 
strained farms who seem to undergo either a drought or a flood 
every year or every other year, I am asking the subcommittee to 
include language in the fiscal year 2010 Agriculture 
Appropriations bill to encourage the USDA to forgive the 
remaining balance of the loans issued between September of 1996 
and July of 1997 to farmers in the Black Dirt region.
    These farmers should not have to pay for USDA's mistake, 
which forced them to take out these loans more than a decade 
ago. By forgiving the loans, the USDA would remedy a previous 
injustice while providing desperately needed financial 
assistance to growers in the region.
    My district is also home to dozens of lakes, many of which 
are in critical condition. I submitted a request for a lake 
aeration project for the Village of Greenwood Lake, which has 
been classified as a critical water body due to the large 
amount of phosphorous entering the lake, creating damaging 
algae blooms and weed growth, leading to toxic gasses and 
eutrophication of the water.
    I have requested $177,000 for the Village of Greenwood Lake 
to use an inversion oxygenation system to remove toxic gasses 
from the water, increase water quality, improve fish growth, 
reduce algae and weeds, and eliminate odors. And I appreciate 
your consideration of this project, which would be beneficial 
both to the environment and the residents of the community.
    Lake Oscawana is a natural two-mile lake in Putnam County, 
New York, whose water quality has been declining for the past 
40 years. New York State DEC recently concluded that remedial 
measures need to be taken without delay. And we have submitted 
a request to your subcommittee for a million dollars for the 
Lake Oscawana Management and Restoration Plan, calling for 
binding the existing phosphate in the lake and preventing 
phosphate from entering the lake by constructing storm catch 
basins and storm drains to capture the phosphate from storm 
runoff. Without this funding, the lake will die.
    I have also submitted a request for the Hudson Valley 
Agricultural Viability Program, which is run by the Hudson 
Valley Agribusiness Development Corporation. This program 
fosters economic development in the Hudson Valley's 
agricultural industry by using methods like gap financing, 
business assistance for agricultural start-ups and expansions, 
and different networking opportunities for farmers and other 
agricultural entrepreneurs in the Hudson Valley. I encourage 
you to provide funding for this valuable program.
    I thank the committee for granting me this time to speak 
today and for your consideration of these important projects in 
New York's 19th District. And I look forward to working with 
you in the coming months on this legislation. And I would be 
happy to answer any questions.
    [The information follows:]

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    Ms. DeLauro. Thank you very much, Mr. Hall.
    Mr. Latham, do you have questions?
    Mr. Latham. I just have one question. The onion farmers, 
were they paid insurance losses?
    Mr. Hall. The onion farmers I don't believe were paid. I 
don't think so. I think what they did was they tried to do what 
they were told was the correct procedure with the crop, which 
would not have required insurance because they were harvesting. 
And then when it turned out that it was unmarketable, they were 
given permission to destroy it. But the reason that they had to 
take out the loans was because they had not received disaster 
aid.
    I can get more information on that.
    Mr. Latham. Yes, if you would. I mean, I understand the 
situation, but if they were paid with----
    Mr. Hall. I will find out with certainty for you. That is a 
good question.
    Mr. Latham. What is the request then, also, on the Hudson 
Valley Agricultural--is there a number?
    Ms. DeLauro. I think it is $1.5 million.
    Mr. Latham. 1.5.
    Mr. Hall. Thank you, Chairman.
    Mr. Latham. Okay. That is all. Thank you.
    Mr. Hall. These are among the small businesses in the 
Hudson Valley that not only provide--usually, when things work 
out well, they provide a healthier environment. Orange County 
was, before the economic downturn we are experiencing, was the 
fastest growing county in New York State. And, by farming, not 
only do these businesses and these farmers provide us with food 
that is grown close to us, which is fresher when it gets to 
market and which prevents us from having to eat food that is 
dependent upon a long interstate highway system or rail system 
and, therefore, could be interrupted, the supply could be 
interrupted for some of these crops if we were not able to get 
produce from the West Coast or from the Midwest, but it also 
prevents overdevelopment.
    And the overdevelopment pressure coming up, population 
moving up from New York, was immense until the real estate 
downturn. And, once the situation turns around, which sooner or 
later I expect it will, we will once again see farms being cut 
up and divided into small plots with houses on them, making 
farming actually a viable way for people to survive and feed 
their families in all of our interests, as well.
    Ms. DeLauro. Mr. Alexander.
    Mr. Alexander. No, ma'am.
    Ms. DeLauro. Let me just--it was interesting, this morning 
I met with some small farmers from Oklahoma and other parts of 
the country, the Midwest. And they wanted me to be sure that 
this committee would be concerned about commercial farming in 
the Midwest, et cetera, and that folks in Connecticut and New 
York would understand what farmers' lives were about. And I 
said, ``Well, you know, we do, in fact, have farms in 
Connecticut and in New York, with some of the same kinds of 
difficulties and problems that you have, as well, in terms of 
disasters,'' et cetera, et cetera. So it is just an interesting 
juxtaposition here for me this morning, and the reality about 
what happens in some of these areas.
    I, too, like my colleague Mr. Latham, we need to find out 
if there was an insurance payment on that.
    Mr. Hall. We will.
    Ms. DeLauro. How many onion growers were affected?
    Mr. Hall. I think it is in the range of a dozen. And, once 
again, I will get the exact number for you.
    But they are a group of small farmers who are always, it 
seems, on the verge of either giving up or being successful or 
perhaps planting just a holding crop, like grass, to keep the 
erosion, if we have a flood. We have had three 50-year floods 
in the last 6 years. You know, it is between the Delaware and 
the Hudson River Valley. And the Wallkill and the Minisink 
Rivers run through it, and extreme rain events cause them to 
lose soil. So sometimes they plant holding crops onto sides of 
the irrigation ditches in fallow areas. But there are living on 
the edge.
    Ms. DeLauro. On the edge, sure.
    But, also, if you can, explain to us how come this is 
occurring now? I mean, this happened 1996, 1997.
    Mr. Hall. Because I am here now. I wasn't, obviously, in 
Congress when this hail storm occurred. And I have learned from 
meeting with them and talking to them that they are still 
trying to pay off loans from 1996 and 1997.
    Ms. DeLauro. Do you know what the average loan amount was 
for folks through FSA?
    Mr. Hall. No. I will find that out for you.
    Ms. DeLauro. Okay. We can follow up with your office on 
that.
    So it was a crop insurance policy? Just explain that to me 
for a second, in terms of the crop insurance. They had to be 
brought to harvest.
    Mr. Hall. My understanding is that, in order to collect 
crop insurance, the crop would have had to have been destroyed 
and be declared unmarketable. And so they went through the 
season harvesting, treating with pesticides, weeding, 
preparing, and then wound up with a crop which in the final 
analysis was rotten anyway. So they lost a year and----
    Ms. DeLauro. They petitioned the USDA, if you will, for 
permission to destroy the crop, but they were told under the 
existing crop insurance policy that sound farming process would 
be to care for and to try to bring it to harvest, so they got--
--
    Mr. Hall. I think they know their crops and their soil 
better than USDA does.
    Ms. DeLauro. Yeah. Okay. Okay.
    Mr. Hall. We will get those details for you.
    Ms. DeLauro. Yes, that would be terrific to do that.
    Mr. Hall. Thank you for your consideration.
    And, of course, many of you know probably from your own 
districts that water is a big issue, be it drinking water, 
wastewater, et cetera. And I can't tell you how much I am 
hearing from my 43 towns and cities I represent. And these lake 
issues are critical because of the combination of natural 
phosphorus coming out of the rocks surrounding them, runoff 
from lawn treatments, sewage treatment plants in 
municipalities, private septic systems at homes, which used to 
be sparse and have gotten to be more and more crammed together. 
And all of that running into the lakes is causing a problem.
    Ms. DeLauro. What are the current uses of the lakes? Is it 
fishing? Is it recreation?
    Mr. Hall. Well, it is fishing and recreation. That is one 
of the things that keeps the property values around those lakes 
up and provides tourism and so on.
    Ms. DeLauro. In terms of the water quality, what effect has 
that had on the surrounding communities?
    Mr. Hall. It reduces the oxygen content, kills off the 
fish, causes algae and----
    Ms. DeLauro. Is it commercial fishing that is done there?
    Mr. Hall. It is recreational fishing, but that is obviously 
a big tourism attraction.
    Ms. DeLauro. Sure. Well, as somebody who comes from the 
area of the Long Island Sound, you know, with fishing and 
recreation, that is a combination.
    I have just a couple questions on the Hudson Valley, the 
Agricultural Viability Program. Are you making the request for 
funds through the rural development programs? ``Yes'' is the 
answer to that question.
    Mr. Hall. Yes.
    Ms. DeLauro. And if you could just give us a little bit of 
a handle on how the program would work, to look at economic 
growth and jobs, et cetera, in your view.
    Mr. Hall. Well, it is a combination of trying to educate 
farmers about improved or new practices, other possible crops 
that could be grown, and setting up meetings with them and 
trying to get marketing opportunities they don't have.
    It is ironic that we grow some of the best onions in the 
world. In fact, if you haven't had an Orange County onion, you 
haven't lived. But you can go to Wal-Marts or Hannafords or 
Stop & Shop or any of the big supermarket chains, and you can't 
find them. And I am trying to help, we are trying to help, and 
the State is trying to help them get our local crops into our 
local supermarkets, not just into the farmers' markets. I mean, 
those of us who know to go on a Saturday or Sunday to the 
farmers' markets can get real tomatoes and really good onions 
and so on and so forth. But, unfortunately, it is the buyers 
for the big stores who move a large amount of product.
    So those are the kinds of things that we are trying to do 
and that the program would enhance.
    Ms. DeLauro. Thank you very, very much. And, again, we will 
continue to work with you and with your staff on these.
    Mr. Hall. Thank you very much.
    Ms. DeLauro. Thank you.
    I see Congressman Putnam.
    Mr. Putnam. I need to get you all some orange juice for the 
witness table.
    Ms. DeLauro. Thank you. Thanks for coming by.
    And Congressman Putnam is in his fifth term. He represents 
Florida's 12th District, and he serves on the Financial 
Services Committee.
    And you know the drill, Congressman. You are welcome to 
summarize your statement. Obviously, the full statement will be 
read into the record.
                              ----------                              --
--------

                                         Wednesday, April 22, 2009.

                      ``CITRUS GREENING'' DISEASE


                                WITNESS

HON. ADAM PUTNAM, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    FLORIDA
    Mr. Putnam. Thank you, Madam Chairman. And thank you for 
the opportunity to be here. Mr. Latham, Mr. Alexander. Thank 
you for giving all Members the opportunity to come before you.
    Under the rules of the House and rules of your committee, 
what I am here to discuss is technically an earmark, but it is 
an earmark that impacts Florida, Alabama, Louisiana, Texas, 
Arizona, and California. And at least 27 Members of Congress 
have signed on to the request, but it is a large request. And I 
think it bears public scrutiny and this committee's attention 
and review.
    And it is to continue funding--this is not a new request, 
but it is an expansion of an existing program--the Citrus 
Health Response Plan, CHRP, which is a cooperative arrangement 
between the States that I mentioned, between the State 
Departments of Agriculture, but primarily funded by the USDA, 
to deal with what has been called by the New York Times and USA 
Today, as well as people who actually know what they are 
talking about, ``the world's most destructive citrus disease,'' 
which is in Asia known as Huanglongbing and in the United 
States known as citrus greening. And there is no known cure. 
And we are a long way toward developing the appropriate 
treatment, containment, psyllid control and other things.
    And there are really two pieces to this problem. One is the 
disease itself, and the second is the vector of the disease, 
which is a psyllid, a bug. And so, research thus far that you 
have supported and you have funded has determined thus far that 
the best way to control the disease is to control the psyllid. 
That seems to be the easiest thing to get our arms around. And 
so research continues in that vein.
    In California they have the bug; they don't have the 
disease. In Florida we have both, and it has been devastating. 
We have seen infection rates where a citrus grove may have a 5 
percent infection rate when they discover the greening presence 
in that particular citrus grove, and within 12 months it is 40 
percent. It has an extraordinary spread. The range of the bug 
is as yet undefined, but it is a long range that that bug can 
fly in any particular day. And everywhere that it goes, it 
feeds on new, young fleshing growth.
    So, in addition to it exacerbating the spread and 
accelerating the spread, even without accounting for human 
movement of plant material, it also has further curtailed the 
growth or the sustainment of the existing acreage of the 
industry, because people refuse to plant new trees because that 
essentially baits in the bug that spreads the disease. Older, 
more mature trees that have tougher, less tasty leaves are less 
vulnerable to the disease. So when people pull out the tree, 
they don't replant because that is essentially adding back to 
the problem. So you are seeing a steady decline in acreage, 
steady decline in trees. Long term, this is a huge problem for 
the citrus industries in all citrus-producing areas of the 
country.
    So those are the points that I wanted to be sure and get 
across.
    The other point I want to be sure and get across is grower 
involvement. In Florida, we fund through a box tax an actual 
agency of the government; there is a Florida Department of 
Citrus. And the growers tax themselves primarily for marketing, 
so that you can see a TV commercial that says, ``Buy Florida 
orange juice. Paid for by the Florida Citrus Growers.''
    They have transferred, on their own, $20 million of grower-
funded monies into this research effort. So there is real skin 
in the game, not in-kind donations, not counting growers riding 
around in trucks as labor costs that is a matching account for 
the Federal Government. They have put $20 million in real 
dollars into an account to do the research.
    And to make sure that it is managed properly, they have 
asked the National Academy of Sciences to identify how to spend 
that money. So it is not just a bunch of growers sitting around 
a table saying, well, I think the answer is this, or I think 
the answer is that. They are bringing in real experts, a blue 
ribbon panel from the National Academy to monitor and regulate 
and direct this grower investment.
    So I believe that it is--when you look at the standards for 
why would I ask someone from Connecticut to pay for this, this 
is not limited to any one congressional district; it is not 
even limited to any one particular State. There is a tremendous 
economic impact to all of the States who are citrus-producing 
States. It is a $12 billion industry in Florida alone. We 
certainly want to make sure that we contain it and treat it in 
Florida and prevent its spread into Louisiana, Texas, Arizona, 
and California.
    And so I believe that there is a compelling national 
interest for the United States Department of Agriculture to 
dramatically expand their commitment to research on new 
varieties that are more resistant to the disease, ways to 
control or eradicate the disease, and ways to control or 
eradicate the psyllid that transmits the disease.
    So that, in sum, Madam Chairman, is the purpose of our 
request for a significant expansion of your current funding for 
the CHRP program.
    [The information follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Ms. DeLauro. Thank you.
    Mr. Latham.
    Mr. Latham. Yeah, is there any particular type of citrus 
that it affects more than another? Or is it just any--I mean, 
is it lemons or oranges more so than----
    Mr. Putnam. As of now, it is pretty indiscriminate. There 
have been other citrus diseases that were--you know, grapefruit 
was more vulnerable than Valencias. This appears to be pretty 
indiscriminate.
    Mr. Latham. When you call it ``greening,'' what happens to 
the plant?
    Mr. Putnam. Well, the telltale sign, when scouting crews 
are moving through the groves looking for it--and the reason 
why they call it ``Huanglongbing'' is that I believe it 
translates to ``dragon disease'' or something like that--you 
will see in the middle of a green tree this unusual sprout up 
through the middle of it that is a vivid yellow or white off 
color that just really sticks out like a sore thumb. When you 
see that, it is already done, you are too late. But it causes a 
rapid decline of the entire tree.
    Previous citrus diseases that you have funded were slow 
decline; you could continue to harvest citrus for several more 
years after that. This is a very rapid decline where you are 
not only losing the fruit, which is 1 year's income, you are 
losing the tree, which, when replaced, will be 5 years before 
it is paying its own freight again. So that is the real 
challenge. There is 100 percent mortality, and it is very 
rapid.
    Mr. Latham. Are they doing anything in Asia that we could 
learn from, do you know, to treat this?
    Mr. Putnam. Interestingly, there is kind of a--you know, 
the largest citrus-producing areas in the world, particularly 
for juice, are Florida and Sao Paulo, Brazil. And then for 
table fruit you would throw in California. The Asian industries 
are very small, but the researchers who have been over there 
actually have come up with an interesting finding, that there 
is some kind of an oil or an essence or compound in guava. You 
probably don't have too many guavas in Iowa, but we have them 
in south Florida, and they are very popular in Latin American 
cuisine.
    And they are actually experimenting with intersetting 
citrus with guava as kind of a home remedy approach to 
repelling the psyllid. It doesn't do anything about the 
disease, but it keeps the disease vector out. And so, since 
planting guava trees throughout the 800,000 acres of citrus in 
Florida is unworkable, they are looking for exactly what it is 
in that guava plant that makes the difference, so that you 
could convert it to an oil or a compound or a spray material 
that could be sprayed on to the trees or added in some form of 
the production strategy and find out what it is that is so 
offensive to the psyllid.
    But they discovered that on a mountainside in Vietnam.
    Mr. Latham. Really?
    Mr. Putnam. Yeah.
    Mr. Latham. Interesting.
    Thank you, Madam Chairman.
    Ms. DeLauro. Mr. Alexander.
    Mr. Alexander. Mr. Putnam, it is obvious, from the numbers 
that you threw out telling us how much local producers and 
farmers had already invested into the prevention of this 
disease, that you were defending your so-called earmark 
request. And I hate that we have to defend a request that is 
legitimate, regardless of where it is or what it is for.
    So the question is, will USDA, in your opinion, they are 
not going to try to address this without your request, to the 
point that you would like it addressed?
    Mr. Putnam. Well, I don't know that I would characterize it 
necessarily that way. There is funding in the President's 
budget request that is more consistent with where this funding 
has been in the past. The reason for the ask for the expansion 
of the program is that all of the other citrus--the money that 
has gone in the past has only gone to Florida, because we are 
the only ones who have it. The other citrus-producing States 
have suddenly realized they need to keep it out.
    And the only way they are going to keep it out is to have a 
dramatically expanded program that is detection in their own 
States, ramping up the research because I think everybody, 
frankly, believes that it is inevitable that it will spread to 
those States and they want to be ready for it so that they are 
not experiencing the kind of losses that Florida has had. So 
you are seeing a really remarkable partnership between 
typically competitors coming together to jointly fund research 
and jointly lobby the Congress to make this a greater national 
research priority.
    We are working with USDA and the other States' departments 
of agriculture to refine the amount that is being requested, so 
that we are asking for exactly the right amount of money as 
opposed to just rounding it off to the nearest million and 
saying, well, we think this is what it is going to be. They are 
actively involved in what the precise ask will be when you 
reach that point in your process. And so that is really the 
reason why we have ramped it up.
    We have always treated this as a Member request because 
that is how it was sort of born, and so we have maintained that 
posture. But USDA has worked with the industry and the State 
departments of agriculture to fund it.
    Mr. Alexander. Thank you.
    Ms. DeLauro. Just, I think, for some clarity, my 
understanding is that--and you can help me with going back to 
when this started--that it has been $40 million annually 
through APHIS for this program. Does that go back to 2005? So 
it is about 4 years. So we have done $40 million every year 
since 2005. And the request now is for $64 million. Is that----
    Mr. Putnam. It is 100.
    Ms. DeLauro. No, I think it is 64.
    Mr. Putnam. Excuse me, excuse me.
    Ms. DeLauro. It is the 40 plus 64, so it is $104 million 
then for this year.
    Mr. Putnam. That is correct.
    Ms. DeLauro. So it is the 4 years of the 40 and now 104. Is 
that right?
    Mr. Putnam. Yes, ma'am.
    Ms. DeLauro. What are the additional activities? Help me 
with this. Because it seems like we have a worthwhile effort 
here, but we have gone, you know, $160 million and now we want 
another $104 million. Tell me what we are getting for this, to 
get at this difficult issue.
    Mr. Putnam. You are adding 4 more States to the mix. What 
you have done in the past was substantially limited to the 
State of Florida. And with California and Texas, in particular, 
but it is also Louisiana, Arizona, and the other minor citrus-
producing States coming onboard, they recognize that they have 
to take extraordinary measures in their own States to be 
prepared for what is unfortunately likely to be an inevitable 
spread of the disease into their citrus-producing region.
    Ms. DeLauro. Is it there yet? And I understand prevention. 
Is it----
    Mr. Putnam. In California, which is, with all due respect 
to the other citrus-producing States, the other 800-pound 
gorilla in terms of citrus, they have the vector, they have the 
psyllid. They do not yet have the disease.
    Ms. DeLauro. Yeah, you said that. Okay.
    Mr. Putnam. So one of more expensive components to this, 
which--for example, in the State of Florida to guarantee clean, 
new plant material--in other words, clean bud wood; clean, new, 
reset baby trees that go into the ground when old trees are 
pulled out--the entire citrus nursery industry in the State of 
Florida has been relocated above the citrus belt, above the 
frost line, to get them out of all of the production areas. So 
we essentially rebuilt an entire nursery industry in north 
Florida well away from commercial citrus as a way of 
guaranteeing future clean plant material.
    That is one of the major lines in this request for the 
other States. Florida has already bitten the bullet. That is a 
big expense component.
    The survey and detection in the other States is also one of 
the larger expenditures in the request, as well as the bench 
work, the lab, just the old-fashioned science, to try to find 
what the right compound is, what the right chemical is, what 
the right natural predator is for the psyllid so that we can 
control this and prevent the eradication of the citrus industry 
in the United States.
    Ms. DeLauro. So the $160 million has been for Florida 
alone, is that correct? The 4 years, the $40 million for 4 
years? That has been for Florida. We now are thinking about 
California, Texas----
    Mr. Putnam. Substantially, yes.
    Ms. DeLauro. Substantially, it has been for Florida. And 
now we are talking about an addition of California, Texas, 
Louisiana, Arizona.
    Mr. Putnam. Arizona. And I am also told that, in the early 
years of that CHRP program, it was----
    Ms. DeLauro. Iowa--he was looking to see if Iowa was 
included.
    Mr. Putnam. Maybe Ames can help us solve this problem.
    But in the early years of CHRP, CHRP was born to fight 
actually citrus canker.
    Ms. DeLauro. Well, this is a question I had, as well. And 
excuse my naivete, because I have sat on this committee long 
enough. And I think we did for citrus canker in 2009 $1.2 
million. I know there is another request for $4 million this 
time around.
    So is the psyllid related to citrus canker, or is this 
something else?
    Mr. Putnam. No. Here is just the nasty history: This 
committee was funding the citrus canker eradication effort for 
a number of years----
    Ms. DeLauro. Yes. And we continue to do it.
    Mr. Putnam. And we were even or winning against the disease 
until 2004. And during 2004, Florida experienced four 
hurricanes in about 9 weeks. And that citrus disease is spread 
by wind-driven rain, which we had a fair amount of that 
particular summer.
    And so, the back-to-back seasons of 2004 and 2005 when we 
had Charley, Ivan, Wilma, Frances, Jeanne, and Katrina all 
passed through the State in those two summers, USDA, along with 
the industry, came to the conclusion that we had lost the fight 
against citrus canker because it was now endemic, at 
substantially the same time they discovered the presence of the 
worst citrus disease on the planet, which is greening.
    And, frankly, to their credit, instead of acting like a 
bureaucracy, they were pretty agile and shifted the existing 
teams that had been funded for canker, the teams that were 
trained to go into the groves and look for the given disease, 
they retrained them to look for greening. We essentially 
shifted what had been the canker-eradication program into what 
became the greening program, all under this umbrella that is 
the CHRP, Citrus Health Response Plan.
    And so, what was born as the canker program morphed into 
the greening program, and that is what you have been funding.
    Ms. DeLauro. And so the $1.2 million for this year for the 
2009, which we just got signed, that money will be used for the 
greening? Or is that----
    Mr. Putnam. No, that is additional research on the canker.
    Ms. DeLauro. That is research on the citrus canker.
    Mr. Putnam. Correct.
    Ms. DeLauro. But is there still the view on that--and, you 
know, as I say, we have been funding these because we want to 
make sure that we have a healthy industry. But is there still 
the view that this has been lost, in other words, the fight 
against citrus canker has been lost?
    Mr. Putnam. The approach that we had been taking on citrus 
canker was the destruction of the tree. And that practice 
ended, because we were burning the village to save the village. 
And so we ended that approach.
    That is not to say that the disease is not still having a 
devastating economic impact on the industry. But the previous 
USDA policy of erratic--they essentially ended the goal of 
eradication, and it became a suppression and treatment program. 
Because the eradication program involved determining that 
canker was present, drawing a radius around that infected tree, 
and destroying everything inside that radius. It was extremely 
costly to the State of Florida and to the Congress, who was 
funding that program.
    So the eradication program ended after those storms blew 
the disease in so many places. It would not have made sense to 
continue the eradication program. That is not to say that, as a 
disease, it is not worthy of research into how to have better 
varieties to deal with it and all those other things. But it is 
certainly--the eradication effort ended, and that was a USDA 
determination.
    Ms. DeLauro. Okay. But, again, though, as I understand it, 
and I just want to be clear, the $1.2 million for 2009 is for 
research.
    Mr. Putnam. It is for research.
    Ms. DeLauro. It is for research on citrus canker. And the 
$4 million is additional research in this area that you are 
talking about, not eradication, but to look at how we try to 
deal with varieties or how we try to deal with it domestically. 
But it is for both; it is for canker and for greening research.
    Mr. Putnam. It is for both.
    Ms. DeLauro. You know, just for the clarity of it, in 
having to explain what we are doing.
    Mr. Putnam. Yes, ma'am.
    Ms. DeLauro. There was a question about the research. In 
any way, are we doing any partnering with Asia, anywhere else 
that is dealing with this, in terms of the resistance to this?
    Mr. Putnam. Yes. In fact, the example I gave was where, you 
know, a grad student and a professor from the University of 
Florida had traveled to Vietnam because they had heard about 
these villages that were living with greening on the side of a 
mountain in the middle of nowhere. So I am actually pretty 
impressed at the cooperation that is out there. And I am very 
impressed that they have brought in an organization with the 
stature of National Academy to help them direct their research 
funds.
    And the industry has also hosted two global scientific 
research summits in Florida to compare best practices and the 
status of research and all those kinds of things. And so there 
really is a cooperative effort between ARS, the extension 
research agencies in the State of Florida and California, as 
well as Texas.
    Ms. DeLauro. My next question was going to be about the 
institution. So it is Florida, Texas, and California----
    Mr. Putnam. Primarily.
    Ms. DeLauro [continuing]. Primarily where the research is 
being done.
    Mr. Putnam. Right.
    Ms. DeLauro. Well, thank you very, very much. I don't have 
any further questions.
    Tom, anything?
    Mr. Latham. Are there any other types of trees, ornamental 
or anything, that have seen any signs of this? Or do you know?
    Mr. Putnam. Not of the greening, but you raise the 
ornamental aspect. Unfortunately, there are dozens or 
hundreds--at least dozens of ornamentals that the psyllid 
loves. So every landscaped home in the State of Florida 
probably has one or two different bushes in there that this 
psyllid loves, which accelerates its spread, you know, 
particularly in areas where you have commercial production up 
against an urban interface.
    And so the ornamentals piece contributes to the spread of 
the vector, not to the spread of disease.
    Mr. Latham. Okay. Thank you.
    Mr. Putnam. Good luck with all that, Madam Chairman.
    Ms. DeLauro. Thank you very much.
    I have to say this, and I guess maybe you have the same 
kind of frustration that I am experiencing. This is 4 years, I 
mean, it is $160 million, not chump change, you know, I mean, 
maybe in this institution it is, but it is not, in terms of 
being able to deal with the research that can get us to how we 
try to affect this in some way. And it is a little troubling 
that we are not moving more quickly.
    Mr. Putnam. Well, you know, we see this in everything we 
grow and raise in the United States. And the rate of new 
diseases and new introductions of pests and diseases is 
expanding exponentially as the world gets smaller. And 
Americans' diets are changing. We want more produce from Latin 
America and more spices from Asia. And we are just getting a 
more diverse palate, and food is becoming globalized.
    And APHIS just can't keep up. Either because of funding or 
because it is not a priority or whatever, Homeland Security is 
not getting it done. And so, you know, it is not as sexy to 
seize a pink hibiscus mealybug or an African heart-water tick 
until 21 polo ponies die. But it is not as sexy as getting a 
bale of marijuana or a human trafficker or a cache of weapons. 
And, long term, we have to lift the profile of protecting our 
food supply as food trade becomes more rapid and more broad.
    And, you know, anybody that wants to do trade with the 
United States, the first export they are going to have is food. 
I mean, agricultural trade is going to be their entry into our 
market. And so this is going to be a problem whether it is, you 
know, impacting wheat or corn or swine, impacting avocados, 
which I know we have a request to you on that; we just decided 
to bring you the big one.
    I mean, it is endemic. And we don't have the robust food 
science infrastructure to deal with it.
    Ms. DeLauro. I thank you for that comment. It is an 
important comment.
    Mr. Putnam. I will get off my soapbox.
    Ms. DeLauro. No, no. I think this committee has been for a 
very long time, both sides of the aisle, very, very concerned 
about the issue of food safety. And it has not become part of 
the national discourse. It only becomes part of the national 
discourse when nine people die of contamination and hundreds 
and thousands, you know, through food-borne illness are 
hospitalized. So it is about prevention.
    Thanks very much. Appreciate it.
    Mr. Putnam. Thank you.
    Ms. DeLauro. I think we have no more witnesses. The hearing 
is concluded.
                                           Wednesday, May 13, 2009.

                        SECRETARY OF AGRICULTURE

                               WITNESSES

HON. THOMAS VILSACK, SECRETARY OF AGRICULTURE
JOE GLAUBER, CHIEF ECONOMIST
W. SCOTT STEELE, BUDGET OFFICER

                  Chairwoman DeLauro's Opening Remarks

    Ms. DeLauro. Hearing is called to order. My apologies for 
being late. Good afternoon.
    Let me welcome everyone, and particularly Secretary Vilsack 
who comes before this subcommittee today for his second time. I 
want to say thank you to Mr. Glauber for being here and for Mr. 
Steele as well.
    I am pleased to welcome my colleagues and ranking member, 
Mr. Kingston, as we begin the hearings on the fiscal year 2010 
agricultural appropriations bill. Let me just say to you, Mr. 
Secretary, this is the second time we have had the opportunity 
to visit today. I want to thank you for the earlier session we 
had with Secretary Sebelius as well and the Food Safety Working 
Group, really beginning its efforts in the first public 
session. In any case, I am sure you have been working at this. 
I was pleased to be there, pleased to hear your comments and 
Secretary Sebelius' on how we should move forward on food 
safety.
    We are glad to have as you a partner on the critical issues 
that face this subcommittee, and I look forward to working with 
you closely in the months ahead. And I know you agree that our 
work is ultimately about people's everyday lives, consumers who 
want safe food, farmers who rely on fair functioning markets, 
children who need healthy food to meet their full potential, 
and rural communities that need new opportunities to thrive.
    I have said before that the issues that we confront in this 
subcommittee and with the Department of Agriculture speak to 
the core responsibilities of the Federal Government. And I am 
encouraged by the commitment you and the Obama administration 
have expressed in meeting these obligations, from improving our 
food safety system to expanding broadband service to rural 
areas, from conservation to strengthening child nutrition 
programs.
    With the economic recovery package that we passed this 
winter, we have already begun to make those investments. I am 
proud of the resources that we secured, $28 billion for the 
USDA, including almost $20 billion to increase nutrition 
assistance. This has meant an additional $80 a month for a 
family of four, real tangible relief for families who are in 
need. Also, $150 million for The Emergency Food Assistance 
Program and funding for floodplain easements, direct farm 
operating loans, and single family housing loans. In other 
words, real relief and real jobs on the ground for some of our 
most vulnerable communities.
    We have worked hard to make these funds available, and Mr. 
Secretary, I know that you are working hard to make sure they 
reach those who would benefit the most.
    Now, I believe we have an opportunity to build on that 
investment and move from recovery to long-term growth, and I 
applaud Mr. Secretary for putting us in a strong place to do 
just that with this year's fiscal year 2010 budget.
    Total discretionary spending proposed in the budget for 
USDA would be $20.4 billion, a 10 percent increase above 2009, 
indeed, a significant increase. Of course, this is just a first 
step. You will recall when you came before the committee in 
March, we discussed the need for serious and long-term reform 
at the Department. The recovery package and now this budget 
represent a powerful down payment on that process. We cannot 
let up at any point along the way, and we must remain vigilant 
and committed to bringing the change the department needs.
    With that in the mind, let me raise a few issues that I 
imagine you will discuss in your statement, and I may ask you 
to elaborate on when we get to questions. For example, I want 
to highlight the Department's proposed funding for FSIS, 
targeting funding to improve the food safety public health 
infrastructure to improve the agency's ability to conduct food 
safety assessments, much of this in response to the 
recommendations in the Inspector General report on risk-based 
inspections.
    I also want to applaud the budget request for Rural 
Development programs. For years, the previous administration 
made grand claims in this area, but failed to put its money 
where its mouth was. The 2009 Bush budget had requested the 
elimination of many direct loan and grant programs in the Rural 
Development mission area. I am glad that this budget request 
does not carry most of those budgetary cuts. I am sure my 
colleagues on the subcommittee feel the same way, and it shows 
a new commitment to rural development.
    I am also happy about the commitment we have made to 
conservation through the recovery package, already bringing 
funds to our communities for the rehabilitation of watersheds 
and flood prevention projects. For example, I must say that, 
yes, I am concerned about some apparent inconsistencies with 
respect to conservation within the budget, and while you 
highlight USDA's work through the Recovery Act to improve water 
quality through the watershed and flood prevention operations 
program, you then note later in your testimony that you 
eliminate the very same program in your 2010 request.
    More troubling is how the budget treats the Farm Bill 
conservation programs. The budget proposes very heavy cuts, in 
my view, to popular and effective programs, such as the 
Wetlands Reserve Program, Wildlife Habitat and Incentives 
Program, the Farm and Ranch Lands Protection Program, and I 
hope that we have a chance to discuss the reasoning behind 
those kinds of decisions in the budget.
    Also, as you know, this committee has a long history of 
working to expand broadband access to rural communities. It is 
also about bringing good jobs to rural America so that its 
residents do not have to leave their communities to find work. 
I look forward to discussing the implementation of the Recovery 
Act funding that we provided.
    I want to thank you again for joining us, Secretary 
Vilsack. I look forward to asking you about these and other 
efforts within the Department. Ultimately, our appropriations 
reflect our priorities as a Nation. We have big goals, and it 
is the details, it is the budget and the basics that we are 
discussing here today that get us there, and we have a 
responsibility and I know you share that responsibility to get 
it right.
    And with that, let me recognize our ranking member, Mr. 
Kingston, for any opening remarks that he may have.

                     Mr. Kingston's Opening Remarks

    Mr. Kingston. Thank you, Madam Chair, and Mr. Secretary, 
welcome back to the committee. We certainly appreciate your 
office being so accessible.
    I have concerns about this budget, and basically it is 
about a 20 percent increase, and during a time when we are 
asking American households to cut back and they have lost so 
much of their own personal savings during this bad economy but 
we are asking them to increase Ag's funding about 20 percent.
    And yet there are some cuts in there, and I would like to 
work with you on these cuts, but as you know, we have gone this 
route before on so many of these things and never done it 
successfully.
    Elimination of RC&D. The Chair just mentioned the previous 
administration's lack of commitment to rural development. Well, 
RC&D is a pretty big commitment to the rural areas. It is 
fairly important to them. Eliminating that, I am open to it 
actually, to discussion of it, but I don't see how we get 
there. It has been talked about before and it has never 
happened.
    The Administration eliminates congressional earmarks, and I 
can understand that the administration would prefer its own 
earmarks to the legislative branch. Members of this committee 
should know that the WIC funding is now about 40 percent of the 
discretionary limit, which the Chair had said is about $20.4 
billion, $7.7 is WIC. WIC budget just grows every year, and for 
Members who are concerned about congressional directed 
spending, we need to be thinking in terms of that. As sensitive 
as it is to bring anything up about WIC, I think it is 
something we should be talking about.
    The farm limitation amendment, savings from that, the 
Senate has pretty squarely dealt with that right now and 
rejected that concept on a bipartisan basis.
    This House has dealt with crop insurance commission issues 
before. I am not sure that that is going to last.
    But I guess what I want to when we get into Q&A, what I 
want to hear from you is how committed is the Administration to 
these proposals. Is it real or is it just the kind of the 
Washington Two-Step that we do every year along with 
veterinarian fees and inspection fees?
    Then, part of the increase is things, as you know, the 
stimulus program increased broadband tremendously, I think from 
$400 million to almost $2.7 billion I think if my numbers are 
right. Yet, this still has a broadband increase. You know, they 
just won the lottery. They didn't just get a 10 percent bump in 
the stimulus. They more than quadrupled their budget. I am not 
sure what the numbers are, way past that, and so now we are 
going to increase them again. That would seem to me like a 
logical place maybe not to increase.
    So there are some issues that I am looking forward to this 
testimony and have great respect for you and your ability, but 
I want to talk about how do we square this away with realities 
that are out there.
    So thanks for coming back and I yield back.
    Ms. DeLauro. Thank you very much, Mr. Kingston. Mr. 
Secretary, if you would proceed with testimony, and the full 
testimony will be in the record and we will ask you to 
summarize.

                     Statement of Secretary Vilsack

    Secretary Vilsack. Thank you, Madam Chair.
    Madam Chair and distinguished members of the subcommittee, 
it is a pleasure to come back before you today to discuss the 
details of the President's 2010 budget request for the 
Department of Agriculture. As the Chair indicated, I am joined 
today by Scott Steele, our budget officer, and by Joe Glauber, 
our chief economist.
    In my testimony before this subcommittee in March, I 
outlined the President's goals for the Department and the 
challenges and opportunities we face in revitalizing rural 
America and the economy at this crucial time.
    Over the first 100 days of this administration, USDA has 
set out a new course to promote a safe, sustainable, 
sufficient, and nutritious food supply, to ensure that America 
leads the global fight against climate change, and revitalize 
rural communities by expanding economic opportunity.
    We have moved quickly to respond to these difficult 
economic times by creating jobs, increasing food aid to those 
in need, and revitalizing rural communities. We have also made 
civil rights a top priority, with definitive action to improve 
the Department's record and move the USDA to a model employer 
and premier service provider.
    Before I delve into the specifics of the 2010 budget, I 
would like to provide a brief update on our efforts to 
implement the Recovery Act.

                      RECOVERY ACT IMPLEMENTATION

    The USDA has taken decisive action to implement provisions 
of the Recovery Act. We immediately took measures to make 
available almost $20 billion or approximately 70 percent of the 
total funding received under the Act for increasing the monthly 
benefits of the supplemental nutrition assistance program. We 
have also allocated $125 million for emergency food assistance.
    To assist farmers struggling with tight credit markets, we 
obligated over 99 percent of the $173 million in the Recovery 
Act funding for direct farm operating loans, which has provided 
assistance to 2,636 farmers, of which approximately half were 
beginning farmers, and 23 percent were socially disadvantaged 
farmers.
    In the area of the environment, in the natural resource 
conservation, we announced a national sign-up for $145 million 
in floodplain easements, which will restore and protect an 
estimated 60,000 acres of flood-prone land. In addition, $45 
million has been provided for the rehabilitation of watersheds, 
and $85 million for 53 flood prevention projects in 21 States.
    Rural communities are also benefiting from our actions. We 
have made available more than $600 million in funding to 
provide safe drinking water and improve wastewater treatment 
systems for rural towns in 34 States. We have begun the 
implementation of the Act's broadband provisions in concert 
with the U.S. Department of Commerce and are determining the 
best targeted utilization of the $2.5 billion provided for 
expanding rural broadband into communities that would otherwise 
not have access.
    The USDA has also obligated a loan level of $3.4 billion in 
guaranteed and direct single family housing loans for over 
28,800 loans. I want to assure this subcommittee that the 
Subcabinet, the agencies and Department will be held 
accountable for not just swift implementation but also ensure 
the funds are being used effectively and efficiently.

                        PRESIDENT'S 2010 BUDGET

    The President's 2010 budget, released on May 7, 2009, 
proposes over $20.3 billion for discretionary programs under 
the jurisdiction of this subcommittee, an increase of nearly $2 
billion over the 2009 levels provided in the Omnibus 
Appropriations Act. This increase is primarily associated with 
the Special Supplemental Nutrition Program for Women, Infants 
and Children, international food assistance, rural development, 
and other priority programs.
    At this time, I would like to briefly point out how this 
budget supports our highest priority programs.

                           NUTRITION PROGRAMS

    The budget fully supports nutrition assistance programs, 
including full funding for the Special Supplemental Nutrition 
Program for Women, Infants and Children, to serve all of the 
estimated monthly average of 9.8 million participants. In 
addition, the Administration is proposing an increase of $10 
billion over 10 years for reauthorization of the Child 
Nutrition Programs. These increases will be used to improve 
access to nutritious meals, to encourage children to make 
healthy food choices and to enhance services for participants 
by improving program performance and integrity.

                              FOOD SAFETY

    In support of the President's commitment to modernize the 
food system, the budget requests over $1 billion for the Food 
Safety and Inspection Service. This is the full amount 
necessary to meet the demand for meat, poultry and egg products 
inspection, as well as providing an increased investment in 
food safety assessments, and technology needed to enhance our 
ability to identify, respond to and reduce food safety risks.

                                 TRADE

    Expanding our access to world markets and developing long-
term trade relationships continue to be vital components of our 
strategy to improve the vitality of the farm sector and quality 
of life in rural areas. Due to the global credit crisis, we 
have seen significant increases in demand for export credit 
guarantees provided through the GSM-102 program. To help meet 
this demand, the budget provides a program level of $5.5 
billion, the maximum authorized by the 2008 farm bill for CCC 
export credit guarantees for 2010.
    To encourage further export expansion for our products, we 
need to work hard, both in Washington and in our offices 
overseas, to ensure continued access to overseas markets. I 
appreciate the subcommittee's support in providing additional 
resources in 2009 for this activity, and our 2010 budget builds 
on this foundation with a $16.4 million in additional funds to 
maintain the Foreign Agricultural Service's overseas presence 
and upgrade their information technology infrastructure.

                     INTERNATIONAL FOOD ASSISTANCE

    The 2010 budget also supports the administration's 
commitment to renewing U.S. leadership and promoting global 
development and fostering world food security by doubling the 
level of discretionary funding for the McGovern-Dole 
International Food for Education and Child Nutrition Program. 
The budget also supports a program level of $1.7 billion for 
P.L. 480 Title II donations which will reduce our reliance on 
the need for future emergency supplemental funding.

                     ENVIRONMENTAL SERVICES MARKETS

    The budget reflects a new course the administration has set 
to ensure that America leads the global fight against climate 
change and to revitalize rural communities by expanding 
economic opportunity. To this end, the budget includes an 
increase of $15.8 million to develop markets that reward 
producers for sequestering carbon and limiting greenhouse gas 
emissions.

                            RENEWABLE ENERGY

    The budget promotes America's rural leadership in 
developing renewable energy by supporting over $780 million in 
investments, a net increase of $275 million over 2009. Notably, 
our discretionary request supports $280 million in guaranteed 
loans and grants for the Rural Energy for America Program, or 
REAP.

                           RURAL DEVELOPMENT

    For rural development, the 2010 budget includes funding to 
support over $21 billion for loans, loan guarantees, and grants 
for ongoing discretionary programs, an increase of $825 million 
over 2009. This includes $1.3 billion in loans and grants to 
increase broadband capacity and to improve telecommunication 
service.
    To spur the development of small business and value-added 
agriculture in rural America, increased funding is sought to 
support $63 million in loans under the Rural 
Microentrepreneurial Assistance Program and $8 million for 
Value-Added Producer Grants.
    The budget also provides funding necessary to finance 
homeownership opportunities for nearly 59,000 rural residents 
and fully supports the administration's commitment to protect 
low-income tenants participating in the Rental Assistance 
Program, many of whom are elderly, in about 248,000 multifamily 
housing units.

                        AGRICULTURAL PRODUCTION

    Consistent with President Obama's desire to invest in the 
full diversity of agricultural production, the budget requests 
an additional $6 million for assisting the organic sector, 
establishing marketing agreements that will involve quality 
factors affecting food safety for leafy greens or other fruits 
and vegetables, and supporting independent livestock producers.

                                RESEARCH

    For research, the budget also includes funding to support 
our highest priorities. This includes a $70 million increase 
for competitive research grants that will enhance rural 
research and extension programs and provide incentives for 
teachers to pursue professional development.
    The budget also requests an additional $10.8 million to 
develop tools and strategies for mitigating and adapting to 
climate change.
    We are requesting an additional $11 million to conduct 
research on new varieties of bioenergy feedstocks, as well as 
developing technologies that will result in sustainable, 
efficient and economic production practices for biofuels.
    In order to promote the healthier eating habits and 
lifestyles, the budget also includes an increase of $13 million 
to determine the barriers to individuals in following healthy 
eating and physical activity recommendations and to develop 
new, healthier foods.

                            FARM SAFETY NET

    In my last appearance before the subcommittee, we discussed 
the administration's proposal to improve fiscal responsibility, 
while supporting a robust safety net for producers that 
provides protection for market disruptions, weather disasters, 
pests and disease that threaten the viability of American 
agriculture.
    I want to reassure you that the President's budget does 
indeed maintain the three-legged stool of farm payments, crop 
insurance, and disaster assistance. However, in keeping with 
the President's pledge to target farm payments to those who 
need them the most, the budget proposes a hard cap on all 
program payments of $250,000 and to reduce crop insurance 
subsidies to producers and companies in the delivery of crop 
insurance.
    While the budget includes a proposal to phase out direct 
payments to the largest producers, the Department is prepared 
to work with Congress and stakeholders as these proposals are 
considered.
    For 2010 the budget requests an increase of $67.3 million 
to continue the activities necessary to modernize the 
information technology we rely on to deliver farm program 
benefits. I certainly appreciate the subcommittee's interest in 
this effort and the $50 million provided in the Recovery Act 
which is allowing us to make progress in this area. Although 
this combined level of funding will allow us to continue to 
make progress, additional funding will be required in 
subsequent years to complete the stabilization and 
modernization efforts.
    The 2010 budget fully supports partnering with landowners 
to conserve land, protect wetlands, and improve wildlife 
habitat through vital Farm Bill conservation programs. For the 
2010 budget, the budget includes nearly $4.7 billion in 
mandatory funding for conservation programs authorized in the 
2008 Farm Bill. It also includes $907 million in discretionary 
funding for ongoing conservation work that provides high 
quality technical assistance to farmers and ranchers and 
addresses the most serious natural resource concerns.

                              CIVIL RIGHTS

    Ensuring equitable treatment of all our employees and 
clients is a top priority for me. By holding each USDA employee 
accountable for their actions and through the implementation of 
my recently announced civil rights plan, we are striving to 
make the Department a model agency for respecting civil rights. 
In support of these efforts, the 2010 budget includes funding 
to address program and employment complaints of discrimination 
and to increase the participation of small, beginning and 
socially disadvantaged producers in USDA programs.
    Another key initiative is the expansion of outreach to 
unserved and underserved constituents. The 2010 budget includes 
funding to support the establishment of the Office of Advocacy 
and Outreach authorized in the 2008 Farm Bill. It also provides 
funding necessary to support enhanced government-to-government 
relations and improve tribal consultation activities.
    We are seeking an increase of $45.8 million to ensure that 
USDA can reliably deliver its broad portfolio of programs in a 
secure IT environment. Instituting a department-wide cyber 
security initiative will eliminate critical vulnerabilities 
that threaten the integrity of the USDA network and the 
security and privacy of departmental systems and information.
    We share the President's vision of a strong economy. 
Therefore, like other agencies, we have begun making difficult 
but important budget decisions which include eliminating 
wasteful and inefficient spending. The 2010 budget reflects the 
elimination of earmarks and funding for programs that are not 
as high a priority as others I have mentioned or to provide 
services that can be supported by other means. This includes 
billions of dollars in mandatory savings and discretionary 
savings for the termination of the Resource Conservation and 
Development program, Watershed and Flood Prevention Operations 
program, EZ/EC grants program, the High Energy Cost Grants, and 
grants for public broadcasting digital conversion.
    We have begun the process of making tough decisions about 
where our priorities lie and have made some tough choices about 
where to spend our resources. These choices reflect a new 
direction we are moving in and provide the foundation and 
diverse opportunities for farmers and ranchers in rural America 
to thrive.
    Madam Chair, that concludes my statement. I will be glad to 
answer questions.
    [The information follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Ms. DeLauro. Thank you very much, Mr. Secretary. It would 
appear that we have started the process for three votes. So we 
will start to move to questions, and we will strictly adhere to 
5 minutes, and that includes myself so we can get this hearing 
off the ground.

                                  WIC

    Let me just address the WIC program. The budget requests 
$917 million for the WIC program. It is a program as you state, 
$7.8 billion. $625 million is requested to support an average 
monthly participation of approximately 9.8 million women, 
infants and children.
    The question that I have is about what appears to be a lack 
of justification included in the budget for the proposed 
increase of $162 million for WIC reauthorization program 
improvements. The budget says the administration will use these 
funds to implement program improvements which could include 
expanding types of education and counseling services, 
developing additional State infrastructure, enhancing program 
efficiency.
    It is a large increase with little justification. Can you 
give us a concrete plan of what program improvements you are 
proposing with this $162 million increase?
    Let me just deal with a follow up on the contingency fund 
so you can answer both together. There is a request for $100 
million for WIC contingency. There is already an estimated $650 
million in the WIC contingency fund for fiscal year 2010 from 
carryover provided in the Recovery Act. The contingency fund 
has historically been funded at $125 to $150 million each 
fiscal year. Why do you think $750 million is needed in the 
contingency fund for 2010?
    Secretary Vilsack. Madam Chair, with reference to the 
additional resources for WIC on program improvements, what we 
are interested in doing is that we expand our efforts to 
educate expectant moms and young moms on the breastfeeding 
opportunities and other nutritional opportunities that they 
must know about in order to be able to start their children's 
lives in a nutritious and effective way. So first and foremost, 
this is about expanding educational opportunities and making 
sure that nutrition is part of the process of making sure that 
as people sign up for WIC that they are well aware of the 
various programs that are available and the nutritional 
opportunities that are available.
    I can also suggest to you that we are working with States 
to make sure that we continue to identify those who qualify for 
the program. We are looking at creative and innovative ways to 
get the message out. We are partnering with local farmers 
markets, for example, to make sure that folks are at the local 
farmers markets, encouraging people to sign up, developing 
discount opportunities and ways in which we can encourage fresh 
fruits and vegetables to be part of the steady diets of women, 
infants and children. So this is education, expanded access, 
and greater emphasis on nutrition.

                          WIC CONTINGENCY FUND

    As it relates to the contingeny fund, I think what we are 
attempting to do is to make sure that we don't do what we have 
done in the past, which is to come back repeatedly when the 
economy--we expect and anticipate the economy to improve at 
some point in time, but it is fairly clear that most 
projections have unemployment rising. If unemployment rises, 
there is always a significant need for a number of services, 
including this one. We just want to simply be in a position 
where we are not coming back to Congress repeatedly asking for 
more resources when we have underestimated the number of people 
who are in need of assistance now.
    Ms. DeLauro. Just a quick follow-up on that. The highest 
contingency level previously needed to keep the WIC program 
running was about $387 million. That was 2008. Do you think the 
economic situation in 2010 is going to be twice as bad as 2008?
    Secretary Vilsack. Well, I think there are a number of 
factors. We obviously are hoping that by the end of this year, 
we see a significant improvement in the economy. Employment may 
not necessarily completely parallel that growth and that 
recovery, and so there may be continued need in 2010. We also, 
I think, have to realize that we are changing the makeup of the 
food packages for WIC, and we are changing the combinations of 
what we are essentially providing.
    There may be impacts and effects that we have not totally 
calculated or, which is what Joe has given me a note here, food 
price volatility. That is always--so it is a combination of not 
knowing precisely when the recovered economy will reflect in 
ordinary people's lives, combined with food costs, that could 
create problems where we are coming back to you repeatedly for 
assistance and help. We are trying to do as best we can 
estimating what our needs are.
    Ms. DeLauro. I would ask you just to keep in touch with us 
on this $162 million increase and what this outreach--this 
expanded access in education is about. So I think the 
subcommittee would be interested in those efforts.
    With that, Mr. Kingston.

                       2010 PROPOSED BUDGET CUTS

    Mr. Kingston. Mr. Secretary, I wanted to try to find out 
where the administration is on these proposed cuts. I am 
interested in them. Anything to reduce this budget I think is 
important. But I wanted to find out how many of them are real 
and how many of them are just the annual proposals.
    For example, we have mandatory user fees for Food Safety 
and Inspection Service and APHIS and the grain inspection as 
well, and so what I would like you to do is maybe on a scale of 
one to 10 tell me what the intensity level is of the 
administration in terms of using political capital and fighting 
it.
    The reason I say that is the President made a big deal 
about, send me a bill with earmarks, then I am going to reject 
it, and then we sent him an Omnibus Bill that had lots of 
earmarks and he signed it and did something real unusual for 
this administration; they blamed it on George Bush. So not to 
inject partisan politics here.
    But here is my question to you. Okay. Cotton storage, got a 
lot of bipartisan support on that. Like on a scale of one to 
10, is this a 10 in intensity?
    Secretary Vilsack. Congressman, here is why this was 
proposed and so that you can tell from our response that this 
is a serious proposal. This has been--the only other product 
that has this kind of support is peanuts, and the peanut 
support is very contained and very limited, and only under 
limited circumstances is it triggered.
    So this essentially creates the potential for distorting 
the market because you may end up having cotton stored far 
longer than it would otherwise be stored because essentially 
the government is paying for it. So, as we look at this 
program, it does provide a unique benefit to one commodity, and 
so we felt that it was appropriate and necessary to put this on 
the table.
    Obviously, we recognize your role in this. We appreciate 
you are not just going to simply pass the President's budget. 
You are going to examine it. You are going to look at it. You 
are going put your stamp on it. We want to work with you. But 
there is a reason behind this proposal, and I think it is a 
legitimate one.
    Mr. Kingston. The sugar program, for example, is sort of 
always ignored, and a lot of that comes through Commerce 
because there is a tariff. But Americans pay a higher price per 
pound for sugar because of a USDA program. Even though it 
doesn't--there is not a tax mechanism directly, it does cost 
them more, so I want to say cotton is the only commodity and 
one of the few commodities----
    Secretary Vilsack. I want to make sure I am clear about 
this. I am not suggesting that there aren't--I am saying for 
this kind of storage situation, cotton and peanuts are unique.
    Mr. Kingston. All right. Payment limitation, lot of debate, 
Senate kind of rejected that. Do you think that is going to 
survive?
    Secretary Vilsack. We are willing to work with Congress on 
this. I think, again, when we looked at in an effort to try to 
be cognizant of deficits and the concern that you all 
legitimately have about deficits, we looked at the fact that 3 
percent of America's farmers were at the threshold that we 
proposed. There has been a lot of conversation about whether or 
not it ought to be adjusted in terms of adjusted gross income, 
as opposed to gross sales. We are certainly happy to look at 
that. We are also certainly happy to look at the hard cap the 
President did campaign on of $250,000 by essentially limiting 
the loan programs to $145,000. That is a per entity cap. So 
that does provide a strong part of the safety net.
    In addition to that, you have got the new disaster programs 
that will be implemented. In addition to that, you have crop 
insurance, which is expanded now to 350 different products and 
substantial subsidies involved with that.
    So we see a strong safety net, and we simply ask the 
question whether or not there are ways in which that safety net 
can still do its job and at the same time be fiscally 
responsible.
    Mr. Kingston. What about RC&D, elimination of that? That 
actually had been proposed by the Bush administration and did 
not go very far.
    Secretary Vilsack. These are very hardworking folks around 
the country that are providing a service and have been doing 
that since the late 1960s. When it was first established, the 
idea was that this would be a transition program eventually 
transitioning to local and State financing. The principal 
beneficiaries of this program now are, in fact, local economic 
development efforts and State economic development efforts. We 
think there are ways for State and local economic development 
resources to be used to continue this important responsibility 
perhaps truer to the initial intent of the program. That is why 
it has been proposed, and again, I think there is a legitimate 
reason for at least bringing this before you.
    Mr. Kingston. Thank you. In my 15 seconds I have left, the 
earmark elimination, how do you think that is going to fare, 
just handicapping it? And I will say this. I believe that 
Congress has reformed earmarks substantially in the last 2 
years.
    Secretary Vilsack. Let me respond this way. We have 
significant research needs in this country, and what I think is 
needed is perhaps a better dialogue and better level of 
communication between an administration and a Congress, not 
necessarily this administration and this Congress, but just 
generally speaking, because when each body sets their own 
separate priorities, it creates conflict.
    And I think what the President's trying to suggest is a 
process by which we work together and communicate together and 
establish joint priorities which I think at the end of the day, 
reduces conflict and perhaps provides better utilization of our 
resources.
    Mr. Kingston. I know I am over time. I am looking forward 
to working with you on this. I appreciate it.
    Ms. DeLauro. I am going to call the recess for the 
committee. We have three votes and ask people to get back here 
as quickly as possible.
    [Recess.]
    Ms. DeLauro. The hearing will resume. Thank you. It got a 
little longer than three votes, but thank you very much for 
your patience. Let me now recognize Mr. Alexander.

                        FOOD SAFETY INSPECTIONS

    Mr. Alexander. Thank you, Madam Chairman. Mr. Secretary, 
good to see you. My question is a little earlier in your 
presentation you said something about an increased amount of 
money for food inspection. Let's us talk about that a little 
bit. I signed a letter with others not too long ago relating to 
the subject of catfish or fish imported. What assurances do we 
have when you say food inspection, catfish or other fish, 
coming from other countries. How well do we inspect those 
facilities, and do we inspect all of them?
    Secretary Vilsack. I wasn't sure whether you were finished. 
We are in the process as you know of making a determination as 
to precisely what the definition of catfish will be. For 
purposes of inspection, that has not yet been finalized and we 
understand and appreciate that there is some interest in that 
definition how broad or narrow it is. I think our 
responsibility is to ensure American consumers that the food 
that they consume is safe. And so part of that means that you 
have to have adequate people and adequate numbers of people to 
do the job adequately. It also means, as the chairwoman 
discussed briefly earlier, a review which is undertaken right 
now at the direction of the President and a food safety working 
group where the Department of Health and Human Services and 
USDA are trying to improve food inspections generally in our 
safety system generally.
    We are not pleased, and I suspect you aren't either with 
the number of people that have food-borne illness incidences 
each year, the number of those who are hospitalized and the 
number who die. So how do we know whether we are doing a good 
job? I suppose one way to measure it would be if we saw an 
increase or a decrease in those numbers that would suggest that 
we either had more work to do or we were on the right track.
    Mr. Alexander. Well, when we say ``inspection,'' do we 
actually send people out to locations where these fish might be 
raised in the fish ponds, so to speak?
    Secretary Vilsack. The law requires inspection not only to 
cover the slaughter and processing of the catfish but also to 
take into account the conditions under which the catfish are 
raised and the conditions in which they are transported to a 
processing establishment. So this is a relatively broad 
authority. It is broader than we have for other products that 
are under our jurisdiction. So we are in the process of working 
through how that is going to be done.
    Mr. Alexander. Okay, sir. Thank you, Madam.
    Ms. DeLauro. Thank you, Mr. Alexander. Mrs. Emerson.
    Mrs. Emerson. Thank you, Madam Chairman. I would like to 
just momentarily refer back to the remarks when you and the 
Secretary were discussing the WIC program and point out to the 
two of you that in one of my counties, Wayne County, Missouri, 
our health department, our public health department that 
actually works with our WIC recipients in that county, has done 
a cooperative program with the University of Missouri extension 
to teach all of our WIC recipients how to do their own garden, 
grow their own garden, preserve, can, freeze vegetables and 
other smaller fruits so that they are able to supplement their 
WIC diet. And it has turned out to be just a remarkable and a 
very positive thing. Because not only are they learning a new 
skill, but they are also able to then have good wholesome 
vegetables. And it is just something that I think we should 
talk about promoting beyond that. Out of my 28 counties it is 
the only county that does this, but I talk about it everywhere 
because I just think it is a great idea.
    Ms. DeLauro. It is a great model and we ought to talk some 
more about it.
    Mrs. Emerson. And there is no taxpayer money involved, 
which is even better. But it is something that is really 
important. And the skills that our extension people bring to 
this service for WIC recipients is remarkable. So anyway, 
thanks. I just wanted to mention that while it was in my mind.

                 NATIONAL ANIMAL IDENTIFICATION SYSTEM

    Secretary Vilsack, last year when your predecessor was here 
we asked him some very pointed questions regarding cooperative 
agreements and the animal identification program. And the data 
that was provided by the Department, it was interesting. And 
just, for example, in Missouri, it showed that USDA had spent 
roughly $120 for each premise enrolled in the program, whereas 
in Montana, it was $1,200 per premise. And the reason I am 
asking this issue, or raising it is while these numbers are 
troubling, I don't think they should be at all that surprising. 
And I think you probably heard when you were in my district 
yesterday there does remain a significant concern, and even a 
fear among many livestock producers as to what type of animal 
identification system Washington might produce.
    And obviously, it is hard to blame our producers for their 
hesitancy in enrolling their premises. I think all of us would 
probably be pretty hesitant to sign up for a government program 
when we don't know what the government program is going to look 
like. And so--and even when FSA rolls out a new program, or 
when we are implementing the new Farm Bill, we don't really 
enroll until we have the program. We have the regulations, our 
county directors understand how it works. But we are asking 
producers with the NAIS to sign up kind of on a wing and a 
prayer if you will. So I am thrilled that you are holding 
listening sessions. And I hope that you will take to heart what 
you are hearing and the fear, and certainly the uncertainty 
that many producers in Missouri have.
    But I know that you all have requested $14.6 million for 
the NAIS program this year which is level funding. Will you 
describe to us what this funding will be used for and 
specifically if it will be used to continue providing funds for 
our state agriculture departments to drive premises enrollment?
    Secretary Vilsack. Well, thank you for your question, and 
it was a very enlightening listening session that I had in the 
State of Colorado this week which was the second of a number of 
listening sessions that we are going to undertake. And it does 
indeed point out the complexity of this particular program. I 
think that there is a good level of dissatisfaction with the 
program at very many levels; either a lack of understanding as 
to what the purpose and intent is, the fact that there are 
distinctions between types of livestock in terms of a 
compliance, the distinctions that sometimes can take place 
within certain types of livestock in terms of do you graze on 
public land, do you graze on private land.
    And so there is a need for a detailed understanding of the 
complexities. What we are proposing here is for the current 
budget year relatively status quo because we are in the process 
of trying to determine what, if any, changes need to take place 
so that we have greater compliance with the system. I will tell 
you that I don't know the answer to that yet and would not know 
it because I haven't completed the listening sessions but would 
say this. My concerns are two-fold. First and foremost is 
animal health. We want to make sure that whatever system we set 
up is focused on animal health. And secondly, we want to make 
sure that we maintain the integrity of the market.
    I think we have seen most recently with a number of 
products and the H1N1 that markets can be devastated and 
impacted by problems. So what I am looking at is making sure 
that we have got a system that preserves as best we can animal 
health and make sure that we preserve the integrity of the 
market. And how that system is going to look, I will know more 
after I finish the listening sessions. But it has been very 
interesting, I have learned a lot and I think we will look for 
creative and innovative ways to improve this program.
    Mrs. Emerson. I appreciate that because a lot of times 
people undertake listening tours having already made up their 
mind, and I can tell that you haven't, so I appreciate that 
very much.
    Ms. DeLauro. Mr. Bishop.

                     RESEARCH EARMARKS FUNDING CUTS

    Mr. Bishop. Thank you very much. And again, welcome, Mr. 
Secretary. I am delighted that you are back with us. And we do 
have a budget that we can talk about this time. I have a number 
of concerns and issues with respect to the budget for 2010. 
Particularly relative to the Cooperative State Research, 
Education, and Extension Service funding cuts. I am sort of 
disappointed in the approach and the methodology which has been 
used in really proposing the Draconian reductions in some 
programs that are really vital to my district and to others 
here on the panel that Cooperative State Research, Education, 
and Extension Service reduction is about 22 percent for all of 
the programs.
    The special research grants have been effectively 
eliminated for most of the ongoing research activities as well 
as the proposed research projects in my area, including 
projects for cotton insect research, blueberry production 
enhancement, water use and water quality and a national peanut 
laboratory's activities with regard to water research 
efficiency. Can you explain why this program has taken such a 
tremendous hit? And the second part of my question has to do 
with funding for the 1890 colleges, universities and Tuskegee 
University which remains flat at $46 million, yet the funding 
for the other higher education programs increases by a total of 
70 percent to $80 million.
    While the disparity in the two given the disparity in 
funding that already exists and has existed historically 
between the 1890s and the other land grant universities, 
particularly over the last 8 years.
    Secretary Vilsack. The answer to the question that you 
posed is somewhat akin to what we earlier discussed as it 
relates to earmarks and the capacity and determination of what 
priorities are in terms of research. The $168 million of 
reductions in the research funding was essentially a reduction 
of earmarked funding replaced by $139 million in increases in 
what we perceive to be priority research in additional pay. So 
the bottom line is a $29 million reduction. We are focusing 
additional resources in other areas of research that would 
explain why we are limiting this research to be able to fund 
research on renewable fuels, climate change, some rural 
revitalization, some education, some obesity prevention. This 
is a way which we set out priorities.
    Now, I will be the first to admit that we did this budget 
in a relatively short period of time, as I know you appreciate. 
And we just yesterday, I believe, got the Under Secretary for 
Research confirmed by the Senate, and I really want to give 
that individual an opportunity to look at all of the programs 
in a more extensive way, which is one of the reasons why we 
don't have additional resources for buildings and facilities.
    Mr. Bishop. Who was that individual?
    Secretary Vilsack. Dr. Shah. Dr. Shah comes to us from the 
Gates Foundation, he is a medical doctor, and I think you will 
find him someone that you can work with and someone who 
understands the importance of research.
    Mr. Bishop. So the child nutrition and obesity research is 
increased, ongoing, reduced? It is my understanding that is 
reduced.
    Secretary Vilsack. It is increased. As it relates to the 
1890 colleges and universities, my understanding, and I could 
be wrong about this and would ask Scott, the $70 million that 
we are proposing as an increase is in a lot of different areas 
which would include potentially additional resources for 
minority serving institutions. So that $70 million has yet to 
be completely allocated.
    Mr. Bishop. I thought it was 70 percent. Was it $70 
million?
    Secretary Vilsack. $70 million. As you know, the Congress 
established the National Institute of Food and Agriculture that 
sort of rolls all of these programs into a new institute for a 
new focus. And we provided an additional $70 million designed 
to try to put resources into those rural--into a number of 
different areas, including grants for science educators, 
additional resources for the 1890 colleges and universities, as 
well as----
    Mr. Bishop. My time is about up, so on the next round, I am 
going to come back and ask you to talk about the Office of 
Civil Rights and the small and disadvantaged farmer programs.
    Ms. DeLauro. Mr. Latham.

                       CONSERVATION PROGRAM CUTS

    Mr. Latham. Thank you, Madam Chairman. And welcome. I 
always want to call you Governor, but it is Secretary. I guess 
I am a little bit confused. I know there is a lot of talk about 
legislation as far as climate change and environment. And I am 
very concerned about the effect that things like that will have 
on agriculture. And I look at the budget proposal. And in 
conservation programs there is some pretty major cuts as well 
as the Wetlands Reserve Program, a cut of $280 million, EQIP 
program $250 million cut, Ag Management Assistance $5 million, 
Wildlife Habitat Incentives Program $43 million, Healthy Forest 
Reserves Program $5 million, Farmland Protection Program $30 
million, Watershed Rehabilitation Programs $30 million, there 
is another $267 million out of NRCS as far as direct 
appropriations. I just don't understand the cuts and programs 
that are very beneficial as far as soil and conservation, how 
we can justify that, and where the money is going, I guess what 
I would ask?
    Secretary Vilsack. I appreciate that question. And allow me 
an opportunity to respond to your question and the concerns 
that the Chair expressed as well. First of all, I think it is 
important to point out that our budget does propose an increase 
in the total number of acres that will be enrolled in various 
programs that would fall within the rubric of conservation. 
Whether it is CRP, whether it is EQIP, or the other programs 
that you mentioned. In the past in 2009, we anticipated 178.5 
million acres in EQIP. Our budget would propose increasing that 
to 195.3 million acres. In CRP, as you know, we have got a 
slight decrease.
    In all other conservation programs, we are going to see an 
increase from 41.3 million acres to 55.4 million acres. And you 
say to yourself, well, how can you increase the acres and 
reduce the money. Well, the reality is the monies that were 
being appropriated were not always expended because of demand. 
For example, let's take the wetlands program. We are proposing 
155,000 acres in that program. Well, we haven't topped 150,000 
acres for all of the years, even though financing was provided 
for more than that.
    So essentially, what we are trying to do is we are trying 
to match the budget with reality in the field and trying to 
match the budget with the number of acres that we actually will 
see enrolled. And I think hopefully you will find some solace 
in the fact that overall, the number of acres enrolled will be 
280 million acres total, and we will spend $4.8 billion in 
compensation benefits and conservation benefits.
    Mr. Latham. What is authorized level of acres in CRP?
    Secretary Vilsack. It is 32 million acres.
    Mr. Latham. And how do you get to 55?
    Secretary Vilsack. No, no. The acreage for CRP is, on this 
chart I am looking at, is 30.4. It is actually going to be 
closer to 32. We actually just extended offers.
    Mr. Latham. I thought you just said it was 55?
    Secretary Vilsack. No. 55 is all the other programs. You 
have all the other programs, you have got CRP and you have got 
EQIP. A total of those three categories is 280 million acres, 
which is an increase of about 36 million acres, additional 
acres.
    Mr. Latham. And how do you do that again with less money?
    Secretary Vilsack. Well, because it isn't that we have less 
money, it is that we are going to be spending--you have 
authorized money but not all of it was spent because we 
couldn't get enough interest in some of these programs. So what 
we are trying to do is align the programs with the amount of 
money that actually will be spent and the number of acres that 
we realistically think will be enrolled. So we realistically 
think for the Wetlands Reserve Program, 155,000 acres would be 
a good goal since we haven't topped 150,000 acres in all but 
one year in the last 5 years. So that is the reason.

                           INDIRECT LAND USE

    Mr. Latham. Okay. Good luck. One question. And I know the 
authorizing chairman brought up the issue last week I think in 
a hearing with the EPA and charging indirect land use into the 
count for ethanol production as far as carbon credits and all 
those things. What is your position on that? And also I may 
also ask on ethanol if you see the EPA changing their standard?
    Secretary Vilsack. Congressman, again, thank you for that 
question. I think the most important announcement relative to 
indirect land use was the fact that the EPA also simultaneously 
indicated they were going to have a peer independent review of 
their formulation and calculation, which I think was very, very 
important and something that we from USDA and others within the 
administration urged to make sure, because we are plowing new 
ground here as you know, and we want to make sure that as these 
calculations are formulated that we really are doing them 
correctly and properly and that we don't do them in a way that 
will, at the end of the day, damage this industry irreparably. 
So that is a concern.
    So the peer review I think is an appropriate step, and I 
appreciate EPA willing to do that. We also have advocated and 
encouraged EPA to take a look at the blend rate. And we are 
encouraged by the action taken recently in asking for comments 
on raising the rate to anywhere from 11 to 15 percent. And we 
are hopeful that in a relatively short period of time, based on 
Washington standards, that we see some positive steps from EPA 
in respect to that blend rate. That is an important 
consideration. And we also appreciate the President's 
commitment in establishing the interagency working group, that 
will allow us to look at ways in which we can grow this market 
and support this market from farmer to gas tank and beyond.
    Mr. Latham. Thank you, Madam Chairman.
    Ms. DeLauro. Thank you. Mr. Hinchey.

                       FOOD SAFETY WORKING GROUP

    Mr. Hinchey. Thank you, Madam Chairman. Secretary, thank 
you very much. I think that--well, I know frankly, that this 
particular committee, especially under the leadership of this 
chairman, has been focused on a number of things, including 
food safety. And I think that that is something that the 
President is also focused on, I am sure it is something that 
you are focused on. He established the food safety working 
group initially. And I am wondering if you could tell us what 
kind of progress is being made, what are the intentions, what 
ways in which that food safety working group is going to move 
forward to try to bring about serious food safety in the 
country?
    Secretary Vilsack. Well, first of all, let me thank the 
Chair and this committee for the work that you all have done in 
continuing to press this issue. And I think the fact that there 
is legislation pending on both the House and Senate side and it 
is bipartisan I think is an important first step. And the 
President acknowledging that establishes the working group and 
before the Secretary of Health and Human Services was 
confirmed, we began a process of staff working jointly through 
USDA and Department of Health and Human Services.
    I think it was an important signal that we were going to 
coordinate our efforts in an effort to try to establish 
principles. Today we had our first listening consultation 
session with industry leaders, congressional leaders, experts 
in this field asking for their input on a number of principles. 
Let me briefly touch on the principles. I think there is a 
growing belief and understanding that we need to focus on 
prevention as sort of the core of whatever food safety system 
we establish, which means more research standards both at the 
local level and also international standards that are followed. 
We need to strengthen surveillance and risk analysis. That 
means we have to focus on good data. And that is important in 
terms of collecting data, analyzing it and then utilizing it.
    Quality monitoring as a result of that data and constant 
and consistent surveillance. And expanded risk-based inspection 
enforcement procedure that provides for an array of potential 
enforcement mechanisms that are consistently applied and that 
focuses on pathogens. I mean, the reality is that sometimes the 
science has been ahead of us and these pathogens, as the Chair 
indicated earlier today, are way ahead of us and we need to 
play some catchup. And a rapid response to outbreaks and the 
facilitation of recovery of whatever industry is negatively 
impacted by an outbreak, which means quick ID, rapid response, 
reviewing for mistakes made, making sure that we coordinate our 
response and that we are consistently and constantly 
communicating within departments.
    And then finally recognizing that resources are not 
unlimited we want to make sure that those resources are 
adequate, but also targeted. And so I think what you are going 
to see is a set of recommendations to the President consistent 
with the legislation that you all are considering that is 
centered on those principles.

                        FOOD SAFETY REGULATIONS

    Mr. Hinchey. Well, thanks very much. The issue of food 
safety is becoming increasingly important across the country 
because of the fact that it is being so destructive. The fact 
that food safety has downslided so much that a great many 
people are dying as a result. Some of the States now are moving 
forward on trying to set up regulations. Do you think that the 
USDA will be in a position to set up a system of regulations 
across the States that will satisfy States generally?
    Secretary Vilsack. Well, I think the first step in that 
process is to make sure that we coordinate our efforts 
initially at the outset with state and local communities. And I 
think that USDA is in a particularly unique opportunity to do 
that because we are already in so many of these communities in 
all States in a variety of ways on the ground. And we actually 
have a relationship with a number of States where we are 
essentially providing resources for inspection. So I think we 
have a good relationship. Obviously it can always be improved. 
And I hope with this new approach and this coordinated approach 
with Health and Human Services that it will improve.

                             FACTORY FARMS

    Mr. Hinchey. We hope so too. And it sounds like it will be, 
and that is a major step forward. I just want to ask you in the 
few seconds I have left, one specific question with regard to 
that particular issue. It has to do with the animals that are 
raised in these large farms, the factory farms of various 
kinds, how they are jammed up close together and in very, very 
nasty circumstances. And part of that is the results that occur 
with these animals and the huge amount of disease that is 
flowing across that occurs out of that. Now, do you think that 
there is a process now of advocating that these factory farms 
reform the way which they operate, stop allowing these animals 
to come so close together?
    What they are doing is they are using antibiotics on 
factory farms in order to bring about antimicrobial 
circumstances for these animals. And that in and of itself is 
causing some substantial health problems in many places. Is any 
focus on this right now?
    Secretary Vilsack. Yes, there is. We are working with the 
Food and Drug Administration to make sure that we focus on a 
science-based system. We are working closely with the FDA on 
both animal and public health. I would say that we are working 
to make sure that sound animal management practices are the 
standard. And I would say, in fairness, I think the vast, vast, 
vast majority of farmers who are raising livestock are very 
sensitive to this, and they are sensitive for a number of 
reasons. First and foremost, they are concerned about the 
safety of their consumers. Without consumers, they don't have a 
market; without a market, they don't make money.
    And so I think that the vast majority of folks are 
sensitive to this. And I think you are beginning to see greater 
sensitivity. I met for example--this is a little bit far afield 
from your question--but I met recently with the egg producers. 
And they are in the process now of voluntarily taking a look at 
ambient air quality around the facilities. They weren't 
required to do this, they are doing it on their own because 
they are sensitive to the concerns that you have raised. So I 
think you are seeing an increased sensitivity by the industry 
and I think the vast majority of people in the industry are 
sensitive to this and are working hard. And I think the 
government, I think we have a new spirit of cooperation between 
USDA and HHS and FDA, and I think that new spirit of 
cooperation will ensure that we are doing what we need to do to 
protect folks.
    Mr. Hinchey. Mr. Secretary, thank you very much.
    Ms. DeLauro. Mr. Davis.

                      RURAL SINGLE FAMILY HOUSING

    Mr. Davis. Mr. Chairman, thank you. The rural America that 
I grew up in doesn't exist today. The rural America I grew up 
in was void in many cases of rural housing opportunities for 
folks who worked off the farm but still did some farming. The 
rural America I grew up in 60 years ago didn't have rural 
waterlines. The rural America I grew up in, in many cases, 
didn't have the resources or research available to them that we 
have today. I believe that USDA and the agriculture and what we 
spend on agriculture has been a blessing to the American 
consumer; cheap food, good quality and generally safe.
    When you look at some of the rural areas where small towns 
are located, generally each of those have a housing authority 
or agency that provide housing for folks who basically live 
inside town. But in many cases, rural families in the last 
several years have been void of an agency called Farmers Home 
Administration which, in many cases, have helped with 502 
housing loans through interest credit as low as 1 percent, the 
515 housing rural rental housing loans that are available.
    So one of the first questions I want to ask, and then I 
want to get to food, as I look at this budget, and I don't see 
what I believe is adequate funding to provide some direct loans 
to families at say just the interest credit, the 1 percent 
loan. I know now we give subsidies up to 20, 24 percent based 
upon the income. But I believe the program needs to be 
expanded. Do you see an expansion of the 502 program which can 
provide individual housing for families that don't have a 
source today to be able to obtain funding for a loan?
    Secretary Vilsack. We were certainly appreciative of the 
additional resources that this committee and the Congress 
provided in the Recovery Act. And we put those resources to 
work immediately because there was a backlog. So to your point, 
there was a backlog obviously because we weren't adequately 
funding the program. But fortunately because of the resources 
that were provided we were able to put them to work and we 
created 28,000 homeownership opportunities that might not 
otherwise have taken place, or certainly wouldn't have taken 
place as quickly as they are. With the budget that we are 
proposing this year we are looking at $1.1 billion in direct 
assistance and $6.2 billion in guaranteed single family loans. 
This is the same level as was provided in 2009, and will, in 
our view, provide 59,000 housing opportunities within the 
country. We are hopeful that we can work with private lenders 
and encourage them to get back, so to speak, in the market. 
Having traveled recently to a number of States, I know that 
there are some real concerns about whether or not those private 
lenders are going to get back in the game. We hope with this 
level of funding that they will. 59,000 home ownership 
opportunities, I think, is fairly significant.
    Mr. Davis. The guaranteed program obviously has especially 
been what has been the driving focus for individual housing in 
rural America through local banks. I do believe that we need to 
sit down and have a more serious talk about direct loans for 
individuals who may not be able to--who just drop below that 
level where they did not obtain housing. I see through my 
district, as I travel, many dilapidated homes that are not 
adequate living conditions. And a lot of those are rental 
units. I just hope that we can talk about that and I would like 
to engage with you. My time is running short.

                     INTERNATIONAL FOOD ASSISTANCE

    The second thing I want to ask about, as we look throughout 
the world today we see a lot of hunger. And I am extremely 
pleased when I see a cargo plane being unloaded and it says 
USAID or USA. In essence, we are shipping food to places 
throughout the world where folks are hungry. Today, probably in 
Pakistan, those 300,000-some-odd refugees will be getting food 
grown by some farmer in America. We have what, a $13 billion 
surplus, probably the only part of America's economy that has a 
surplus in trade. And so I want to ask you about are we doing 
enough in our role in the international food security such as 
the McGovern-Dole Food For Education program. Otherwise, to be 
sure that do we need to enhance those programs, are we spending 
adequately? Because I think that is an area where the national 
security can be greater for us and whether we become probably 
more embraced with people throughout the world if they see us 
helping.
    Secretary Vilsack. Well, I appreciate you asking that 
question. And I would, again, compliment this committee in 
particular for I think what is a steadfast support for those 
kinds of programs. You all saw the appropriateness of providing 
additional money this year for McGovern-Dole which we put to 
good use, and specifically helping out four African nations and 
children within those African nations, and expanded the program 
by several hundred thousand children. We are proposing an 
increase this year of almost $100 million, for a total amount 
of $200 million for that program which will assist 4\1/2\ 
million mothers and children around the world to receive 
assistance over a 3-year period.
    And we are pleased to note that a number of countries which 
we began to assist have seen the wisdom of this program and 
have adopted their own programs and have become self-sufficient 
enough to be able to take over that responsibility; Vietnam, 
Lebanon, two examples for example. I attended the G-8 ag 
ministers conference on food security, the first time the ag 
ministers from the G-8 had ever met, and the conference was 
focused on food security. And we essentially established--and 
if I can just have a minute of time--essentially established 
three components to the U.S. position on food security.
    First and foremost, it is about making sure that food is 
available. And there are three basic components to that. One 
component is the capacity of a country to grow their own, which 
is important. The capacity of that country to actually engage 
in trade, to supplement what they can't grow. And then 
emergency aid and assistance which is what we are talking about 
here is the third component. But even if you have available 
food, it may not be enough unless you have access to that food. 
Which means that it is important for us to continue work on 
investing in the infrastructure and the economy that will allow 
people to purchase food or be able to get food to where it is 
needed.
    And even if you have access to food and even if it is 
available, if you don't know how to utilize it properly, if you 
don't have the nutritional information on how to prepare food 
properly and the like you can still have food insecurity 
issues. So the G-8 ministers, along with a number of other 
countries that were at this meeting, have suggested that we 
make a major international effort in those three areas. And I 
am pleased that this administration, the President in 
particular, have voiced--have given voice to this, and this 
committee has given voice to this. This is extremely, extremely 
important for national security, not just food security but 
also national security.
    Ms. DeLauro. Just to let the committee know I wanted to 
make sure that everyone has participated in the first round, so 
I am going to recognize Mr. Farr. I know you haven't. Mr. Farr, 
and then we will go back and forth. Thank you.

                    PLANT PEST MANAGEMENT PRACTICES

    Mr. Farr. Thank you very much, Madam Chairman. I am sorry, 
I haven't been here. I have been running across the floor to 
Veterans where General Shinseki, Secretary Shinseki is. So it 
is Secretaries Day here today. Thank you for being here. I am 
really pleased that you accepted this responsibility. And I 
think as a governor you really understand how the rubber meets 
the road. And that is really essential in this job today. One 
of the things I wanted to ask you about is I represent the 
Salinas Valley, which is, I think, Salinas Valley is all inside 
one county in Monterey County, and we do $3.8 billion in sales 
of 85 different crops. I don't think there is a county in the 
world that does that many different varieties of crops. Most of 
them are all row crops and leafy green vegetables. When the E. 
coli breakout came, it was obviously that we needed to create 
some protocols in the growing practices that would ensure that 
pathogens wouldn't enter the food chain.
    And the growers, to their credit, came up with a leafy 
green marketing order which essentially now has a process in 
which U.S. certified inspectors, auditors, go in and inspect 
the process. And at the end, if you abide to all these 
protocols, you get a certified California Department of 
Agriculture. What is happening, sort of happened before and 
during this now, is that buyers have started a vicious spiral 
of one-upsmanship using private third-party auditors that are 
not necessarily certified by the--they are trained by the USDA.
    They require even greater levels of assurances by 
essentially telling folks, well, you have got to build fences 
around your fields, you have got to kill every single animal. 
The growers are coming back and saying, look, our hawk 
population, our owls, these are our predators that have been 
very beneficial. And beneficial insects as well, because a lot 
of them grow sustainable viticultures and things like that by 
using integrated pest management. So these private buyers are 
essentially changing not based on science, not based on any 
good ag practices, but it is based on sort of a corporate knee 
jerk idea that we are going to make our growers go through 
tougher standards. And they have to do that or they won't buy 
their field.

                 NATIONAL LEAFY GREEN MARKETING PROGRAM

    And I am wondering two things about this: What is the 
Department doing to help create a national leafy green 
marketing program and what can we do to get the buyers back 
into essentially following Federal protocols rather than 
creating their own? Because it is running into conflicts with 
all of the best management practices, habitat management, it is 
riparian management. What I have learned from both the 
cattlemen and the growers is that you make the most money in 
agriculture when nature can be your partner. We have spent an 
awful lot of time and years in America trying to fight nature, 
wipe out everything that is living, make the fields clean, 
sterilize them essentially and start over again. And that is 
too expensive. And what you end up with is soils that are not 
productive and not that sort of beneficial work.
    And so those that work with nature, and that, essentially, 
is the modern agricultural practices, very green style of 
understanding how to work with nature. And now we have these 
protocols that are killing everything that we have tried to 
establish in modern best management practices. And I think it 
needs real leadership to step in and say to the private buyers 
out there, the big--you know, they are buying--I mean, 
McDonald's is competing against Taco Bell and all these 
companies are trying to say you buy our stuff and we have made 
sure that our growers grow to some kind of sterile process, it 
just doesn't make any sense.
    Secretary Vilsack. This has been an issue that we have been 
grappling with, as you know, for a couple of years. AMS 
published an Advance Notice of Rulemaking in October of 2007 
and received 3,500 comments to it. We began the process of 
trying to formulate a workable plan. We have asked for in this 
budget an increase of $2.3 million to work with the industry 
to, indeed, complete the work in developing and establishing 
and operating a Federal marketing agreement system that will 
involve quality factors but will also make it within reason. We 
have been asked to do this by the producers and handlers, and 
we are in the process of working on this. And at this point in 
time, we don't have a specific agreement, but we are committed 
to working with the industry to get that agreement.
    Mr. Farr. How much is a carrot and how much is a stick? The 
industry is trying to get other States to adopt the California 
method or something similar.
    Secretary Vilsack. You know, that is a question I am going 
to have to ask for additional time to answer because I don't 
know the answer to that question, but I will follow up, our 
staff will follow up.
    [The information follows:]

    USDA's AMS is currently reviewing a request for public 
hearings on a proposed national marketing agreement for leafy 
green vegetables, which is expected to be submitted by a 
coalition of producer and handler representatives of the fresh 
produce industry in June 2009. As proposed, the agreement would 
authorize the development and implementation of production and 
handling regulations (``metrics'') designed to support good 
agricultural, handling, manufacturing, and management practices 
in the fresh leafy green vegetable industry. Metrics would be 
science-based, scalable and regionally applicable in order to 
accommodate compliance of varying size and types of operations.

    Mr. Farr. Thank you.
    Ms. DeLauro. Mr. Kingston.

                    BROADBAND PROGRAM BUDGET REQUEST

    Mr. Kingston. Mr. Secretary, I want to get back to the 
question on savings. On the broadband increase the stimulus 
package had, I think it was $2.3 billion, and then you are 
asking for another increase. And I was wondering why when I am 
sure that the monies has not even been spent?
    Secretary Vilsack. There is a significant need for this 
country to accelerate in a very meaningful way its 
implementation.
    Mr. Kingston. Let me--I mean, philosophically we are not 
arguing we need to--I mean, give me the dollar and cents, the 
buyer's decision here.
    Secretary Vilsack. Well, we are on track with both the 
Department of Commerce and the USDA to begin the process of 
investing the resources that you have provided in the Recovery 
and Reinvestment Act. We hope to have some kind of framework by 
June and resources beginning to hit communities in the fall of 
this year. So we have a very aggressive timetable in terms of 
making grants and loans under the Recovery and Reinvestment 
Act.
    Mr. Kingston. Let me make sure I understand. What you are 
saying is by October we will have spent--no, you are not saying 
that I guess. You are saying that within the next year we will 
spend $4.3 billion which would be stimulus plus what you are 
asking for?
    Secretary Vilsack. That is correct.
    Mr. Kingston. And in addition to that, Commerce will spend 
about $3 billion?
    Secretary Vilsack. And this will come as no surprise to you 
that there will still be a substantial need for additional 
resources because we are so far behind.
    Mr. Kingston. Does this administration see any role for the 
private sector and have any fear that this corporate welfare or 
that there can be an overlap with corporate welfare?
    Secretary Vilsack. Well, I think what we are looking at is 
actually partnerships. If you look at the way in which we are 
going to structure these grants and loans we will be working in 
concert with the industry. We are trying to figure out ways to 
work with them, not against them. We are trying to figure out 
ways in which we can entice and incent these monies to be 
leveraged.
    Mr. Kingston. I would imagine it would be pretty easy. They 
were paying for themselves, now the Federal Government is going 
to kick in 50 percent or whatever the percentage is.
    Secretary Vilsack. With due respect, I am not quite sure it 
is that simple. You have got a number of unserved areas where 
it may be difficult initially to make the business case, but 
the need is still there. And it is particularly important for 
rural America. It is important for the following reasons. One, 
because producers need access to technology so that they have 
just in time information to be able to make informed decisions. 
Two, if we are going to focus on microenterprise opportunities 
in small business development in rural areas they have got to 
be connected not just to their market locally but to the 
worldwide market. To do that, you've got to have access to 
technology. And three, we are way behind, as you know, foreign 
competitors in terms of implementation of high speed broadband, 
and we cannot afford to be behind in this day and age.
    So I think there is a need, I think we are cognizant of the 
fact that we have not done as good a job as we should have in 
the past in investing these resources and we are certainly 
hopeful of correcting those mistakes.
    Mr. Kingston. How are you keeping from unjustly and rich in 
the--this committee has actually had some discussion about the 
retired Wall Street broker who is living on a mountaintop and 
wants to pull out his laptop to check his stock portfolios, why 
should we supplement his broadband?
    Secretary Vilsack. Because he is living next to a small 
entrepreneur who is getting a small business started and needs 
access to a worldwide market.
    Mr. Kingston. Well, that is corporate welfare. If he is a 
small entrepreneur, why should we be running to him to go help 
him make money?

                  BROADBAND INFRASTRUCTURE INVESTMENTS

    Secretary Vilsack. It is in the same way that we back in 
the 1930s, we provided rural electrification to farm families 
because it is a technology that you will need in order to 
succeed. And we have a long-term return on investment that will 
be significant and substantial if we do this right.
    Mr. Kingston. Do you have--I would be interested in how 
this $9 billion got broken down and why for example it didn't 
go to the USDA. If we are in a hurry to get it out, why do we 
create a new program in Commerce when the USDA already had the 
governmental infrastructure to do the grants?
    Secretary Vilsack. I think what you are going to find is 
that we are working in concert with the Commerce Department and 
you are going to see a unified application process, you are 
going to see a streamlined process, you are going to see a 
process that reflects the complexity of this.
    Mr. Kingston. But it should be unified and it should be 
streamlined, in fact, it should be just one agency doing it?
    Secretary Vilsack. The problem is that USDA focuses on 
rural areas. The Commerce Department--there are unmet needs in 
urban centers, in intercity America in the same way that there 
is need in rural America. So I think the reason why you divided 
the money is so that both areas could be served and both areas 
could have access.
    Mr. Bishop. Will the gentleman yield?
    Mr. Kingston. Yes, I would be happy to.
    Mr. Bishop. I don't know if you remember the debate during 
the stimulus package, but that was a really knockout drag out 
over who was going to control these broadband monies, whether 
it was going to be Commerce or whether it was going to be 
Agriculture. And those of us who represent the rural 
communities actually we threw down and drew the line that there 
had to be some control by USDA through rural development in the 
Rural Utilities Service. Otherwise these underserved 
communities in rural areas wouldn't get the benefits. And so 
that is why there was a demarcation so that USDA would have it.
    Mr. Kingston. I think USDA should have gotten all of it 
just because it was an unexisting infrastructure.
    Mr. Bishop. Politics wouldn't allow it?
    Ms. DeLauro. I think we all agree with the ranking member 
that USDA should have gotten all the money.
    Secretary Vilsack. Well, let me suggest--
    Mr. Kingston. Let me yield to Mrs. Emerson one minute.
    Mrs. Emerson. Here is one thing. I am thrilled. I would 
rather give all the money to RUS too, having 28 very rural 
counties. However, the thing that is a little troubling and 
kind of confusing to me is, I know RUS is getting a larger 
piece I guess than the NTIA at Commerce, is that correct? Or is 
it about equal or is it flipped the other way? It is flipped 
the other way.

                             BROADBAND MAPS

    However, the Federal Communications Commission has actually 
been tasked with providing a plan for broadband deployment, if 
you will, throughout the rest of the country and creating a map 
for the places we need it, but it is not due for a whole year 
from now. And that is why I am confused, because I know that 
you all are going to use this money, and believe me we have a 
need, and I have lots of people who applied for these grants 
through RUS. But I am just confused why the FCC then is layered 
over on top of both NTIA and USDA to create this map when 
perhaps we should have created that map in advance. I know we 
have one already in Missouri, so I am not sure it is that hard, 
but still.
    Secretary Vilsack. I think you are going to find that a 
substantial number of maps exist in States that will make it 
easier for us to identify where the unserved and underserved 
areas are and easier for the FCC after we do our work and after 
we do our investments to figure out where we haven't been able 
to meet the need or the demand. And I would say in fairness, we 
have a responsibility to do this job better than we have done 
it in the past. And that is the challenge that we have laid out 
to RUS. And I think with the system and the process and the 
conversations taking place between us and Commerce, I think we 
are going to do a better job.
    Mr. Kingston. Mr. Secretary, are you, in your heart of 
hearts, convinced that there is no corporate welfare here or do 
you have fear that it could creep into some corporate welfare?
    Secretary Vilsack. Honestly, I don't see it that way, I 
truly don't. What I see is the difficulty with small populated 
areas where the need is significant and great being able to 
without government assistance be able to make the business case 
today for the infrastructure investment. Once the 
infrastructure investment is made, then the business case is 
created, I think, to figure out ways in which you can market 
and utilize that service. I just think it is very difficult. It 
is a much easier business decision to make to put it someplace 
where it is less expensive to install and where the rates are 
more competitive and more profitable.
    Mr. Kingston. I know I am out of time, but I can't resist 
saying, so broadband is now an entitlement and a right, is that 
what I am hearing?
    Secretary Vilsack. No, no. I would say with due respect----
    Mr. Kingston. That is the problem with a 5-minute rule, you 
can't get into the philosophical discussions.
    Secretary Vilsack. To be candid, you have had ten minutes.
    Mr. Kingston. I have been yielding generously.
    Secretary Vilsack. They didn't start your clock right away.
    Ms. DeLauro. No, no, no, you were going to say something.
    Mr. Kingston. No, that is good. We will continue the 
discussion later.
    Secretary Vilsack. I will only say that there is a national 
need. It is not an entitlement, it is a national need.
    Mr. Kingston. Close to entitlement.
    Secretary Vilsack. Those are your words, not mine.
    Mr. Kingston. I don't mind adopting them.

                      RUS (ARRA) BROADBAND PROGRAM

    Ms. DeLauro. Mr. Secretary, I will just make one very short 
comment on that. Our concern on this committee, and it is on 
both sides of the aisle, as you can tell, is that we have a lot 
of faith in USDA through RUS delivering these loans and getting 
to where there is the greatest need. And you are not going to 
have to answer this. But I am just saying is that we don't want 
this held up. We have got a stimulus package that is there that 
is supposed to be moved. We figure that in fighting for that 
money, that we could get that money out much more quickly 
because of a developed program than with going through 
Commerce.
    So that is why we are watching as carefully as we can, 
because that is what it was about. That was what--just we were 
in danger of losing this money, as you know. I mean, we fought 
like hell, excuse me, to make sure it was there because we 
believed that USDA had a better mechanism to do this than 
Commerce. So that is what we are just watching, and we are 
going to go vigilant. And we want to make sure that ultimately, 
the loan money gets out fast and quickly. And the stimulus 
money is out there to do the job it was intended to do.
    Secretary Vilsack. And I think your confidence is well 
placed because I think we have had an impact on the system, and 
I think you are going to see those resources on both the 
Commerce and the USDA out as quickly as appropriate.

                 NATIONAL ANIMAL IDENTIFICATION SYSTEM

    Ms. DeLauro. Well, obviously you can tell we are going to 
be looking at it and we will be talking to you about it. Let me 
go back to the national animal identification system issue. Dr. 
John Clifford, APHIS' chief veterinarian, said before a recent 
House Ag Committee at an animal ID oversight hearing, ``The 
system we have has not worked. The system has to be effective, 
and this is not effective.'' Several questions. Why should we 
continue, and I would beg the indulgence of the other side of 
the aisle. Why should we continue the Bush animal ID system? If 
you want us to keep the system on life support in the 2010 
budget, we need to know where you are taking the program, when 
we will have an indication from USDA as to how it will deliver 
an effective animal ID program.
    Let me add to this configuration April 2009 cost benefit 
analysis report. Interesting findings. I am not going to go 
through them all. But the study found that an effective animal 
ID system would be a valuable tool for protecting U.S. market 
share for beef exports. The study concludes that countries that 
fail to provide an effective traceability system will lose 
export market access. Researchers estimate that a loss of 25 
percent of market share loss similar to the South Korean market 
prior to the 2003 BSE. Discovery in the U.S. would result in 
producer revenues dropping by $18.25 per head sold. Anyway, the 
economic benefits that are pointed out in this study, we didn't 
do the study, they came out of people who know this area and 
who have come to some recommendations and conclusions. There 
are positive economic benefits from an effective animal ID 
system. You also have public-private partnerships.
    If we have a mandatory system you cut down the costs 
because we are not dealing with marketing everywhere in this 
place. We are also going to get the private sector to pick up 
some of the costs of this effort as well. What are the greatest 
impediments to delivering such a system? Since the voluntary 
approach for 5 years has failed, doesn't the study further make 
a case for a mandatory identification system?
    Secretary Vilsack. There are a number of issues within 
animal identification, and I will just touch on a few of them. 
You asked what are the barriers. There is a serious reservation 
and concern on the part of a number of producers as to 
precisely how this information will be collected, who will 
collect it, where it will be stored, how secure it will be and 
what uses beyond animal identification could potentially be 
used and whether or not information that is collected is 
subject to any kind of public disclosure. That is one issue. 
There is the issue of cost. There is a significant difference 
between the cost of an animal identification system for 
poultry, for sheep, for hogs and for cattle. I think it is fair 
to say, and I could be corrected on this, but I think it is 
fair to say that the cost of the cattle industry is 
significantly higher than it is to the other industries. And 
the question then becomes who bears that cost and who should 
bear it and what cost is it.
    And I have seen some estimates as high as $5 to $6 a head, 
which is a fairly significant cost to the producers. There are 
serious issues about how detailed the identification must be 
and whether or not when you talk about traceability whether or 
not you are talking about movements from one field to another 
or are you talking about movements from where cattle are raised 
to where they are slaughtered. Precisely what are you talking 
about. So there are a number of issues that at least I have 
learned in the two listening sessions that lead me to believe 
that we need to be more innovative and more creative about this 
process.
    Now, that is not to say that I will, at some point, in time 
not agree with your observation. I am interested in learning as 
much as I can because my goal is to have as much participation 
as possible.

                       NATIONAL ANIMAL ID SYSTEM

    Now, you may say, well, a mandatory system will guarantee 
participation. Maybe yes, maybe no. If you have serious 
resistance to a system, you could potentially get yourself in a 
situation where you don't have as much participation as you 
need. And it is fairly clear that you need 70 to 80 percent 
participation or the system is not going to work.
    So we are conducting these listening sessions. Madam Chair, 
we don't expect to drag this out for an extended period of 
time. That is not our desire. We do want to give all parts of 
the country an opportunity to participate and to provide input. 
We have already, in two listening sessions, had 57 
presentations. And I think we have half a dozen more of these 
listening sessions scheduled over the course of the next couple 
of months.
    So our expectation is to get something concluded here 
relatively soon. It is important. You have identified the fact 
that there is huge market risk here, if we don't do it right, 
huge. And, of course, there is an issue of animal disease and 
the capacity to contain it if it happens.
    Ms. DeLauro. I want to make a final comment because I am 
out of time. And this is information that I received yesterday 
which I would like to have further conversations with you.
    The Canadians, 2001, launched the system; fully compliant 
by 2002. There are about 10 to 12 companies out there that deal 
with this issue. Wisconsin: 60,000 Wisconsin livestock farms 
registered annually since 2004, $12 per farm to run the 
program. That comes from the--I didn't make that up--Wisconsin 
Livestock ID Association. Forty million head of Canadian cattle 
tracked since 2001, 20 cents per head to run the program.
    The data is there, and we have to come to some decision 
here and look at what the accuracies are of the costs involved 
over the years. They have been overstated to a fare-thee-well. 
We are now at $142 million, and it is another $14.6 million. 
And it is hard to justify for the outcome.
    And when my colleagues look at outcomes--believe me, if 
this were some social program somewhere and we had this rate of 
failure, I suggest to you it would be on the list of programs 
that are going to be terminated. And you would have concurrence 
by 435 Members of this body, given this age of looking at cost 
and what we are spending here.
    I will just leave it at that. I would like to have more 
conversations with you privately about data and information, 
about costs that are involved.
    Ms. DeLauro. Mrs. Emerson.

                  HUNGER-FREE COMMUNITY GRANTS REQUEST

    Mrs. Emerson. Ditto on the computers, too, yes.
    Okay. Mr. Secretary, last week, a report from Feeding 
America helped lay out a cold fact of life in America: that 
more than 12 million children in the U.S. are food insecure. 
And, in Missouri, probably one out of every five children under 
the age of 5 is food insecure. And while those numbers are from 
2005 to 2007, I have to believe based on a lot of anecdotes 
that I have had from folks in my district with rising 
unemployment that that number is rising as well.
    And so, given our knowledge of the facts, I really believe 
strongly that now is the time for Congress and the 
administration to do everything we can to ensure--every effort 
to maximize resources, leverage funds and ensure that we do not 
overlook any opportunity to reduce the number of hungry.
    This is an area where I believe the $5 million request for 
hunger-free community grants will be beneficial. And, as you 
may know, these grants would support communities and efforts to 
organize local strategies for hunger prevention, especially 
among children. And I am hoping that these grants will be 
funded and help find their way to organize and leverage other 
local efforts.
    Mr. Secretary, however, I do believe that we also need to 
ensure that we are doing all we can on a national level, as 
well. In your short time on the job, would you say that you 
have come across anything resembling a comprehensive 
government-wide strategy to combat hunger in America?
    Secretary Vilsack. I think there are elements of a 
comprehensive strategy. I think the capacity to expand the 
school nutrition programs, the school lunch programs, working 
with countless numbers of local organizations to fill in the 
gaps on weekends and during summer vacation. I don't know that 
we necessarily have found the silver bullet, but I think there 
are a lot of innovative and creative ideas out there. And we 
hope to be able foster more of those ideas, particularly in 
those gap areas.
    I will tell you that the recent school closures with the 
H1N1 have given us an opportunity to think about what happens 
if there is an extended period of time when schools are shut 
down. And we began to talk about what our response and what our 
responsibility would be. And I think what I learned from that 
was that, in that circumstance, if we have an extended school 
closure, we have work to do.
    So I think there are elements of a comprehensive plan, but 
I wouldn't tell you today that, here is what the plan is.
    Mrs. Emerson. Well, you know, just like Secretary Clinton 
is trying to marshal all of the government resources--and, you 
know, you have been definitely part of that on the 
international hunger front. We had that meeting; Rosa was 
there, and I was there. It was a couple of weeks ago, who 
knows, but somewhere in the last couple of weeks. And I was 
very excited about that, because I thought she had a great 
handle on it.
    Would it be in your ability to be able to do the same kind 
of multi-pronged strategy and pull everybody together in the 
room on the domestic front? Is that something that you would 
support or that you would be interested in doing?

                          NUTRITION ASSISTANCE

    Secretary Vilsack. Well, and I think to a certain extent, 
not that I have called this or that I have been personally 
involved in it, but to the extent that there has been a fairly 
broad group of folks working on the reauthorization proposal, I 
think we have the workings, the beginnings of that process. And 
I have had a series of meetings, individual meetings, with a 
number of groups on this issue of what do you do on weekends 
and what do you do on summer vacation. I am concerned about 
that.
    I think we have had a real good-faith effort to try to get 
food to children. We just haven't figured out how to make sure 
that all of our children are actually, in fact, fed.
    Mrs. Emerson. Yeah. And the fact that we still have 12 
million who we know are food insecure is pretty scary, and 
considering how rich our country is, even the poorest among the 
poor, as compared to, you know, say, other countries in Latin 
America, Central America. But it is just mind-boggling--
because, you know, some people don't want to go to the food 
pantry. And, of course, half of the time, our food pantries now 
just don't have anything.
    And the school lunch program is great, but not all kids go 
to school. And so, you still have all the little ones who, if 
they are not in Head Start and getting a square meal there, 
they are left out in the cold.
    Secretary Vilsack. That is why WIC is important. That is 
why the day-care programs are important. That is why the school 
lunch and school breakfast programs are important.
    But I would point out that we have another issue that we 
have to deal with, and that is, depending upon how those 
programs are implemented at the local level, it creates the 
potential for stigma, which discourages youngsters from 
utilizing the program.
    Just today, I had a story of a computer program where you 
basically put your thumbprint on the computer to verify you are 
the person who is supposed to get the lunch, and then in big, 
huge, bold letters it says ``free and reduced lunch student.'' 
So your kids are going through the line, you are putting your 
finger up there, and it tags you as a free and reduced lunch 
kid. And, you know, so what happens is youngsters say, ``I 
don't want even to be part of it. I will just skip lunch.''
    Mrs. Emerson. Right. And that is absolutely critical.
    But it would be wonderful if we could encourage you to try 
to put a more formal organization together so we could 
collectively work on this issue. There are so many resources 
and so many private organizations, nongovernmental 
organizations out there working on this issue, and I just feel 
like if we collectively do it and we have a national campaign, 
if you will----
    Secretary Vilsack. Can I just have an amendment that, if we 
were going to do this, I think we ought to do both sides of the 
equation here. We have an issue with hunger, but we also have 
an issue with obesity. And it would be helpful, I think, to 
have a conversation about both.
    Mrs. Emerson. I think it definitely does fit together, 
because in our more rural areas--as we are sitting here eating 
Virginia peanuts with how many grams of fat?
    Ms. DeLauro. Only one side of the aisle is eating. Thanks, 
Jack.
    Mrs. Emerson. 140 calories--oh, no.
    Thank you so much. But we would like very much, and I would 
personally like very much, to work with you on this issue.
    Ms. DeLauro. Mr. Bishop.
    Mr. Bishop. Thank you very much.

                         OFFICE OF CIVIL RIGHTS

    I had said that I wanted to go back and revisit the issue 
of the Office of Civil Rights budget. The proposed 2010 budget 
for the Office of Civil Rights totals $28 million, an increase 
of about 7.6 percent, including funding for an additional two 
full-time employees, bringing the total number in that office 
to 115.
    Given the tremendous backlog and the complaints which have 
yet to be adjudicated, not to mention the cases that are 
currently being filed, in addition to the ramp-up of the second 
phase of the Pigford case and the administrative burdens that 
that will present, I wonder if the Office of Civil Rights needs 
a significant increase in resources above what is being 
proposed.
    And as an addendum to that, could you share with us how 
many cases or complaints are currently pending? And, of those 
pending, how many are internal complaints and how many are 
external complaints, for example, those submitted by minority 
farmers or producers?
    Secretary Vilsack. Sir, I don't know that I have a 
breakdown of the specific number of complaints in terms of 
internal or external. I can tell you that we are reviewing the 
previous 8 or 9 years' worth of complaints. It stands in my 
memory that there is somewhere in neighborhood of 13,000, but I 
could be wrong about that number.
    And the reason we are reviewing them is that a relatively 
small, and I mean a relatively small, number of those 
complaints were found to be valid complaints or properly filed. 
So we wanted to make sure that whatever decisions were made 
were made in the proper fashion.
    We have or are in the process of securing the services of 
some folks who are going to help us go through that process, 
who, because of their previous experience, will be able to do a 
fairly good and relatively quick job because they know what to 
look for in reviewing those files. And I believe we are doing 
that within the existing budget, this year's budget.
    We have requested additional money. We have requested 
additional money for additional employees and for a record 
management system. We are hopeful that, with this additional 
money, that we can also aggressively pursue our congressional 
mandate to establish a meaningful Office of Advocacy and 
Outreach in order to prevent future problems.
    So our hope is that we have adequate resources to do the 
job. And if we don't, then we will have to figure out a way to 
make do. We are very committed to this. And I think we have the 
people to be able to get it done.
    Mr. Bishop. Let me ask you, the Office of Civil Rights, the 
director of that office, does he report directly to you, or 
does he report to the Under Secretary for Administration? What 
is the chain of command there?

                 ASSISTANT SECRETARY FOR ADMINISTRATION

    Secretary Vilsack. You know, I don't have the flowchart in 
my mind right now. I will tell you that what we are suggesting 
is that the Assistant Secretary for Administration be elevated 
to an Under Secretary so that he can be on the same level as 
all the of the other Under Secretaries, so when he asks for 
assistance in promoting civil rights in terms of hiring and 
promotion and activities within each agency, he is at the same 
level as his counterparts.
    Mr. Bishop. He would also oversee the other sub-agencies 
with regard to administration matters?
    Secretary Vilsack. That is correct. That is correct.
    Mr. Bishop. Okay. Do you need legislation to elevate that, 
or will you be able to do it administratively?
    Secretary Vilsack. I don't think I can do that 
administratively. I think that is something that you have the 
power to do; I don't.
    I am just suggesting that it is difficult, if you are 
trying to tell an Under Secretary of Natural Resources and 
Environment to, you know, do a better job of minority hiring or 
to ask questions as to why promotions aren't, you know, 
equitable, just hypothetically speaking, it is difficult to do 
that when you are here and you are talking to someone who is, 
in a sense, a superior, at a superior level.
    Mr. Bishop. Thank you, Mr. Secretary.
    I yield back the balance of my time, and I do have some.
    Ms. DeLauro. I appreciate that, Mr. Bishop.
    Mr. Latham.
    Mr. Latham. Thank you very much, Madam Chairman.

                  EFFECTS OF H1N1 ON THE PORK INDUSTRY

    Secretary, as you are well aware with the H1N1 outbreak--
and, unfortunately, it was called the swine flu and had a--I 
guess, number one, it really highlights the need for the animal 
surveillance program and strong animal disease research, but 
also just the economic hardship that is placed on our pork 
producers. And I have some people talking about, you know, the 
bankers saying don't--asking them if they want to sell their 
land or if they want to sell their sows and things like that.
    Is there anything that we can do? I mean, I have had people 
suggest some kind of a school lunch or government buyout or 
something to try and help them. Are there any actions we can 
take?
    Secretary Vilsack. We are in the process of taking a look 
at what our options are. To a certain extent, the flexibilities 
that this Department has had in the past have been--I don't 
know what the right word is; ``curtailed'' is the only word I 
can think of--curtailed by specific directions from Congress in 
terms of the allocation of resources that have been, in the 
past, available. So our options are limited, but we are looking 
at that limited help and assistance.
    I know that we have received a request to purchase $50 
million worth of pork. I, candidly, am not sure that we have 
that kind of flexibility left in the budget, but we are looking 
for opportunities to help this industry out.
    And first and foremost is to preserve the market that 
exists today by making sure that people characterize this as a 
virus that is not basically a food-borne virus.
    Mr. Latham. As far as trade, it has affected that quite 
dramatically. Anything that we can do on that front?
    Secretary Vilsack. Well, there are several things we have 
done and we are going to continue to do. And some of them have 
been successful, and we still have more work to do.
    Last week, I met with ambassadors from 20 countries, 
basically laying out precisely what our process is, laying out 
what the nature of the virus is, the fact that it was not food-
borne, that you can't get it by eating pork, that there is no 
scientific reason or international trade reason for banning 
pork or pork products. We have been requested to provide 
letters to these countries, and we are in the process of doing 
that.
    We have seen a good response from Central American 
countries. They have reopened their markets. We have seen a 
very strong and positive statement from some of our trading 
partners, like Japan. We still have work to do with several of 
our trading partners, including China and Russia.
    Mr. Latham. Well, I hope when you met you served ham 
sandwiches or something.
    Secretary Vilsack. Oh, I have been doing my personal part, 
I can tell you that.
    Mr. Farr. We eat a lot of pork here, too.
    Mr. Latham. Thanks, Sam.

                             CROP INSURANCE

    Just, I guess, about the crop insurance, I know you have a 
proposal that the government net book quota share, the 20 
percent versus the current 5 percent. In that proposal, also, 
as far as your explanation of your proposed legislation, 
decreasing premium subsidies by 5 percent, increasing the book 
quota, and decreasing the premiums on the CAT coverage by 25 
percent.
    I mean, do you know which--will the Department do some kind 
of analysis--number one, has this been proposed? Is there any 
legislative language? Number two, have you done any kind of 
study as to which companies are going to survive if the 
government takes over more and more of the business? You are 
obviously very aware in Iowa of what a huge impact that has.
    Secretary Vilsack. I appreciate the question about this, 
and I think it is important to sort of understand the history.
    When crop insurance was first issued, it was not something 
that was--it was something that had to be marketed. It was 
something that had to be incented. It was something where 
producers had to be encouraged to participate.
    Today, that is not the case. Many banks are now making it a 
condition of loans. Obviously, when you establish the disaster 
programs, you basically provide it as a condition of obtaining 
disaster relief, that you have crop insurance. So there is now 
more of a mandate than just simply having to market.
    Therefore, the companies don't--they have seen a huge 
increase in their market, but they haven't actually increased 
coverage and so forth. So they have been making a tremendous 
amount of money, billions of dollars. We just think that this 
needs to be a fair deal to taxpayers.
    Now, do we have legislation that is proposed? Not yet. It 
has been drafted, and we will obviously get that to you. Have 
we done an analysis of how individual companies will be 
impacted? That might be difficult to do without knowing 
precisely what companies are selling what products this year.
    I will tell you that we are anxiously awaiting the GAO 
report on crop insurance to determine whether or not that leads 
us in a different direction or supports what we are doing. And 
we expect to see that very soon.
    Mr. Latham. If I could just indulge just for one kind of 
follow-up, I mean, you know, there is great skepticism out 
there about the Federal Government controlling all the banks, 
controlling the car companies. Expanding the role in another 
area here where the government is actually in competition with 
the private sector and expanding that, forcing basically a 
bunch of companies out of business, I think would get a lot of 
pushback, I would have to say.
    Secretary Vilsack. Well, I don't want to get into a 
disagreement with you, Congressman.
    Mr. Latham. Oh, come on.
    Secretary Vilsack. There is a tremendous amount of profit 
being generated from this line of work. And, essentially, it 
was created----
    Mr. Latham. There is also a tremendous amount of risk.
    Secretary Vilsack. There is. And the government is willing 
to share in the risk. If it is 20 percent of the gain, it is 
also 20 percent of the loss. So it is a sharing of that risk 
and a sharing of the gain, and we think a fairer sharing of the 
gain because the gain has dramatically increased. And as time 
goes on, the capacity to more accurately determine what your 
losses are going to be gets better, and so you increase the 
profit margin. So this is about recalibrating the deal, and I 
think it is a fair request.
    Mr. Latham. I respectfully disagree, but thank you very 
much.
    Secretary Vilsack. I expect that.
    Ms. DeLauro. Mr. Davis.

                AGRICULTURE AND FOOD RESEARCH INITIATIVE

    Mr. Davis. In 1862 and 1890, legislation was passed 
creating land grant colleges and, as a result of that, the 
Agriculture and Food Research Initiative, which provides 
competitive grants for some of these universities to do 
research and maybe to find better ways for nutrition, food 
safety, agricultural production, and even conservation 
problems.
    Do you think it is adequately funded today? And if not, 
would you support increasing funding for AFRI?
    Secretary Vilsack. You know, that is an interesting way of 
phrasing a question. We are here to talk about the budget we 
have proposed and submitted. I will tell you that I am looking 
forward to the opportunity to spend a full year understanding 
the intricacies of this budget, because when we do have that 
full year I think we will make perhaps even better decisions 
than we have made in the relatively short period of time.
    I am interested in making sure that the research that is 
done by USDA is, A, coordinated; B, works with our land grant 
universities; C, is competitive as it can possibly be; and D, 
addresses the critical issues confronting agriculture.
    I can't tell you today, because I frankly have not had the 
time to delve into this, whether or not that is the system we 
have today. We may very well have that system. But I wanted the 
opportunity for the Under Secretary of Research to be able to 
look at this and give recommendations to me in terms of whether 
we have the best system and the most adequately funded system 
or whether we need to put more additional resources in. My 
suspicion is that he will come back and say more resources are 
needed.
    Mr. Davis. Madam Chairman, there is a letter that each of 
us probably have. I would like to ask, if we could, for that to 
be put into the record of today's hearing, if that is possible, 
unless it is already a part of it. It is signed by 59 vice 
presidents and 11 presidents of the land grant colleges. With 
your permission.
    Ms. DeLauro. Without objection.
    [The information follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Ms. DeLauro. Go ahead.

                        RURAL BROADBAND PROGRAMS

    Mr. Davis. My second comment, as we talk about broadband, I 
envision that rural Tennessee and rural Fourth Congressional 
District and rural counties across America could use broadband 
as a way to basically have a magnet school for small school 
systems that would be possible for them to be able to educate 
the best and brightest. Maybe a college professor at the 
University of Tennessee or Iowa will be instructing students 
from the fourth grade all the way up through the 12th grade.
    My wife, a teacher, says that for the first 3 years of 
school we teach a child to read and, after that, the child 
reads to learn. And so I think that we are failing in this 
country in not challenging the best and brightest. We did a 
wonderful job with special education, to bring folks into our 
economy, into the workforce, and from then we have actually 
helped folks be able to be a part of our society.
    But I think broadband is where we can really make a 
tremendous difference in many areas, education being one of 
those. When the interstate systems were built, they didn't stop 
in Nashville, Memphis, Chattanooga, Knoxville. They went all 
across rural America. Broadband needs to do the same thing.
    And so my hope is, as you start promulgating the rules, so 
that my communication cooperatives in the district, or wherever 
it may be, can apply for the grants to be able to make 
available and accessible to the rural public school systems an 
opportunity to better fund education at much less cost.
    So, at what level are we today in being able to have the 
rules ready so that we can start seeing some of the dollars be 
expended?
    Secretary Vilsack. Representative, first of all, you are 
absolutely correct that there are multiple uses for broadband. 
You have mentioned one that is very important. The other is 
health care, the opportunity to link health care clinics with 
imaging resources, X-rays and so forth, to save health care 
costs and make it easier for people in rural communities to get 
adequate health care. There are many uses for it.
    We expect and anticipate by June that we will have the 
rules and a framework in place. We expect, as it relates to the 
Recovery and Reinvestment resources, that we will probably see 
three separate distributions of resources. Why, you say, not 
all at one time? Because we want to learn from what kind of 
applications we get from the first tranche of resources. And we 
expect that those resources will first be invested in the fall 
of this year. So we are--and that is both the Commerce 
Department and the USDA.
    Mr. Davis. My home in Pall Mall still has dial-up. So when 
we talk about the need for actually extending 
telecommunications and others to rural areas, that is 
important.
    I hear folks talk about this being a waste of money. The 
farm-to-market roads go to a State highway. The State highway 
goes to the intrastate system. The intrastate roads go to the 
interstate and connect. And as a result of that, food, labor. 
America's future because of rural America, because of looking 
at rural America and helping develop it, has made America's 
future better. I think broadband can be a part of that.
    Secretary Vilsack. I agree with you.
    Mr. Davis. My time is up.
    Ms. DeLauro. Mr. Farr.
    Mr. Farr. Thank you very much.

                         MARKET ACCESS PROGRAM

    I have one question about the MAP program, and then I want 
to get into nutritional issues.
    The administration's--OMB's--justification for reducing 
funding for the MAP program cited a 10-year-old GAO study but 
did not mention a more recent Global Insight study commissioned 
by the Department of Agriculture, a study called, ``A Cost-
Benefit Analysis of USDA's International Marketing Development 
Programs.'' That was a program done in 2006.
    It showed that increased program funding provided by the 
2000 Farm Bill for MAP and for the Foreign Market Development 
Program, the FMD, successfully increased U.S. Agricultural 
exports by $3.8 billion and helped increase the annual farm net 
cash income by $460 million.
    Why was this study not taken into account by the 
administration?
    Secretary Vilsack. Well, I am not sure that it wasn't taken 
into account. I think there is obviously support for export 
assistance; it is a question of what kind of export assistance 
we provide.
    I think what we are suggesting is, the way in which we were 
providing these resources, essentially we are funding for-
profit enterprises for activities and events that would have 
occurred anyway, and, in fact, are occurring.
    So it is not a question of not being supportive of MAP. It 
is a question of whether the resources we were spending were 
for services that would have been provided anyway, and we 
believe probably would have been and will be provided anyway.
    Mr. Farr. Okay. I am sure we are going to have quite a 
struggle in Congress, as we always do, on MAP funding.

                       SCHOOL NUTRITION PROGRAMS

    But let me switch to something that is dear to my heart and 
I think dear to your heart and certainly dear to the President 
and First Lady's heart, which is the school nutrition.
    I have been pointing out that I think we have a morass of 
administrative problems in the facts of the feeding program. 
One is by all the different programs we have created, but what 
is interesting--and we get these reports here from your 
Department on what we spent on buying food.
    And I was just looking at this chart here of the food that 
was purchased. This is the Food and Nutrition Service, Child 
Nutrition Program. There isn't one--the only fresh thing I 
could find on here were pears.
    You know what we spent the most amount of money on last 
year? The most money?
    Ms. DeLauro. Mozzarella cheese.
    Mr. Farr. You are right, Madam Chair. We spent--and there 
is nothing even that comes close--$148,879,987 on mozzarella 
cheese. That is just mozzarella. We also bought all kinds of 
cheddar cheeses and other shredded cheeses, reduced cheeses, 
pasteurized, bulk, sliced cheeses, yellow cheeses, whatever.
    So the problem is that, you know, we are telling the world 
that you have to eat healthy in order to stay healthy, and yet 
what we buy and distribute to the school lunch program is all 
the things that we are not supposed to be eating, at least in 
that kind of quantity. So we have to shift what we are 
providing in the school lunches.
    Now, let me get into the programs. In the schools, we have 
a school lunch program, we have a school breakfast program, we 
have a summer food service program, we have a special milk 
program, we have a snack program. And then we get into--and we 
have commodity procurements, and that was a part of it.
    What I would hope you would do is really start 
streamlining. We ought to have just two feeding programs in 
America. We ought to have a community feeding program with the 
WIC and food stamps and all the things we do outside of the 
schools, in the broader community. And the other one area we 
ought to have ought to be the school nutrition program.
    And I hope that you will work on consolidating these 
programs. I am working on the reauthorization, which isn't in 
this committee. It is not even in the ag committees. It is in 
the Labor and Education Committee, working with George Miller's 
staff to show them--and they have never really gone back in to 
look at why all these programs were built differently.
    We hear from the school nutritionists that they think that 
up to 60 to 70 percent of the programs are consumed in 
administrative costs, because each one of these programs has to 
be audited and so on. And, I mean, I think we ought to be 
block-granting these to the schools.
    We ought to be consolidating the programs into one, kind 
of, multi-school program that the--we ought to be streamlining 
the way we qualify using the data that we use for other Federal 
programs, such as the food stamp program and the Medicare 
program. They are much more accurate, the computer data, than 
these forms that have to go out to parents to prove that they 
are poor, and the parents don't even speak the language that is 
on the forms.
    So I hope that you will seriously tackle this in this year 
when we have to reauthorize it, to essentially rebuild it or 
refinance it to buy things that are nutritious.
    Ms. DeLauro. You may answer, Mr. Secretary, because I want 
to try to get in as many questions as we can to meet your 
schedule and to meet a vote schedule that is coming up.
    Secretary Vilsack. We are proposing additional investments 
in fruits and vegetables, in addition to the $11 billion that 
we are currently purchasing in those areas. And so we are very 
cognizant of the need to focus on more nutrition. We want to 
make sure that the programs are consistent, more consistent 
with the dietary guidelines. And we want to make sure that 
those dietary guidelines are well-informed and well-structured 
on a nutritious diet.
    Your issue about consolidation is a good one, and we will 
certainly give that consideration. 
    Mr. Farr. Why don't we have a salad bar in every school? 
That would be a great question for you to ask. I don't need an 
answer here, but we would be interested in why we can't do 
that.
    Ms. DeLauro. Mr. Kingston.

                         USDA PROGRAMS SAVINGS

    Mr. Kingston. Mr. Secretary, I may need to leave some of 
these for the record, but one of them is on the broadband grant 
eligibility. We have heard from some small suppliers that the 
bigger companies are influencing the grant process and to make 
sure that they kind of will get more than their fair share. So 
we can submit a letter to you on that, but that is something 
that I am sure we are all sensitive about and probably on the 
same page on.
    The other thing is I was interested in your CRP explanation 
to Mr. Latham about the actual usage of it, as compared to the 
allocation of it.
    Secretary Vilsack. Not CRP. Some of the other programs, the 
wetlands----
    Mr. Kingston. Okay, the wetlands. And I was wondering, do 
you apply that same ruler to SNAP and to WIC? Because it would 
appear to me that there would be a similar number of 
enrollments.
    For example, food stamps has, as you know, an automatic 
trigger for enrollees and for food inflation. And it was 
adjusted in October, and yet in the stimulus program there was 
another $19 billion put on it, and now we have another 
increase. And I am just wondering if that same ruler applies.
    Secretary Vilsack. Well, I think it is a slightly different 
circumstance, because you are seeing an increased utilization 
of those programs as opposed to an underutilization.
    Mr. Kingston. Is the increase based on the market trigger 
that is suggested in June, or is it a speculative amount?
    Secretary Vilsack. No, I think the increase is based on 
recognized demand and a weakening economy.
    Mr. Kingston. Let's take a look at that, and I can send 
that letter to you with a better explanation. Because it seems 
to me there is a little more speculation, because it was just 
suggested in October. But we will see.
    The other thing is, I want to encourage you--you had 
testified previously that $49 million was overpaid to 
ineligible participants in farm programs because the 
recipients' income was too high. I want to encourage you on 
that as a potential savings. And if you may remember, the 
dialogue that you and I had at that time was that there was 
also, in terms of the Food Stamp Program, overpayments of $1.29 
billion.
    So, there is a lot of money there that, if we can do our 
jobs better, that we can get. And, of course, the point of both 
of these is you want farm payments to go to eligible farmers 
only and you want food stamps to go to the eligible people 
also.
    Secretary Vilsack. That is true. I think there has been 
progress made on the SNAP program. You know, I don't use that 
term, ``food stamp,'' because, you know, I think it is a 
mischaracterization of the program. It is a supplemental 
nutrition program, and I think that is where the focus needs to 
be.
    Having said that, there has been literally a halving of the 
error rate in that program over the course of the last several 
years. That doesn't mean that there isn't more work to be done; 
there does. And there also needs to be more work done on the 
school lunch and school breakfast program, same kind of issue. 
And we are certainly sensitive to that.
    Mr. Kingston. Okay, good. Because, you know, at the end of 
this process, which I am looking forward to working with you on 
savings, getting after overpayments and inefficiencies may be 
one thing that really unites some philosophies in here.
    Secretary Vilsack. I could use your help in helping some of 
your colleagues understand that, because some people are 
concerned about the fact that we are actually teaming up with 
the Internal Revenue Service to make sure that we have a system 
to check and make sure people who are getting farm payments are 
the ones who are entitled to them. And some of the colleagues, 
particularly on your side----
    Mr. Kingston. No, I absolutely agree with you. Money should 
go to those who are eligible. And I might not like all the 
programs, but they still should go to the people who are 
eligible for them.

                      LIBERALIZING TRADE WITH CUBA

    The other thing is, will the President sign the bill if it 
has liberalization of trade with Cuba, if it gets amended in 
the process?
    Secretary Vilsack. I haven't talked to the President about 
that issue, so I don't want to speak for him.
    Mr. Kingston. What a smart answer.
    I yield back.
    Mr. Farr. Wouldn't that be great?
    Mr. Kingston. Just wondering. Just wondering.
    Secretary Vilsack. We are fortunate to have the opportunity 
to do agricultural trade with Cuba, and we appreciate--you 
know, that has been a good thing for Cuba, and it is a good 
thing for the farmers.
    Ms. DeLauro. It is a good way to increase, you know, 
additional markets here for our farming communities. This is a 
committee that is supportive of this issue, pretty much so. In 
any case--is that true, Jack?
    Mr. Kingston. What was the question?
    Ms. DeLauro. You are for liberalizing trade, aren't you?
    Mr. Kingston. I am so devoted to my loyal opposition 
position that I don't know that I would go along with the Chair 
on that particular question. But I would certainly----
    Ms. DeLauro. Except if we could sell chicken to Cuba.
    Anyway, let's move on. I will try and get as many--let me 
just rapid-fire stuff.

                     UNDER SECRETARY OF FOOD SAFETY

    On the Under Secretary for Food Safety, Mr. Secretary, is 
there a candidate currently being vetted to be nominated for 
this position?
    Secretary Vilsack. Yes.
    Ms. DeLauro. What is our timeline here?
    Secretary Vilsack. Madam Chair, the complexity has to do 
with the arrangements that are necessary in order to allow this 
person to do the job. And we are in the process of working 
through that process. Short term.
    Ms. DeLauro. I think it is imperative. I think you agree.
    Secretary Vilsack. Don't disagree.

                  FOOD SAFETY RISK ASSESSMENT SCHEDULE

    Ms. DeLauro. Food safety assessment schedule, you know, the 
concern here is because we went through this risk-based effort 
that we are not complying with what the IG said with regard to 
their recommendations on risk-based. Why do you propose to do 
the food safety assessments only once every 4 years?
    Secretary Vilsack. You know, I don't know the answer to 
that question.
    Ms. DeLauro. Okay. So if you can get back, I would just----
    Secretary Vilsack. Oh. I have been reminded that we are 
asking for an increase in the assessment so that we can 
increase the number and the frequency.
    Ms. DeLauro. So we can increase the number and frequency. 
Okay. Anyway, we will talk further about that. I may have 
additional questions on that, because the frequency, I think, 
is critically important.

                   AGRICULTURAL CREDIT INSURANCE FUND

    Agriculture credit insurance front, let me just make a 
point on this. Supplemental, $71 million for ACIF. This was 
after $20 million in the Recovery Act. The Congress was never 
notified that the programs were going to run out of the funding 
mid-year, leaving farmers without a source of credit.
    Really, we would love a commitment from you that the 
Department will keep a better watch over these programs, notify 
the Congress when the program is seeing unprecedented demand 
and when we are going to run out of funds mid-year.
    Look, you know and I know these are programs that are the 
only source of credit for some people right now who are 
struggling. So let me just ask you, is the 2010 budget request 
sufficient to cover the surge demand that the farm ownership 
and operating loan programs have been experiencing?
    Secretary Vilsack. We are proposing an increase. Scott 
reminded me that we are forecasting a year in advance. It is 
the best estimate that we have.
    I will reassure the Chair we are in the process right now 
of having meetings with a number of our budget folks to make 
sure that they are within budget. We are going to pay close 
attention to this--to all budgets, not just this one.

                    FOOD SAFETY ASSESSMENT SCHEDULE

    Ms. DeLauro. Okay. I just want to point out that--my last 
question, with regard to the food safety assessment schedule--a 
proposal to do the assessments once every 4 years was made by 
Bush FSIS in its response to the OIG report.
    I am looking to a new administration with a stronger 
commitment to funding public health initiatives. So I want you 
to look at why you are continuing to look at a 4-year proposal. 
And if it is with regard to--I want to really know if it is 
increased funding that gets us stumped, because this is from a 
time past, in my view.

                          CONSERVATION FUNDING

    Okay, let me just--on the conservation funding, I have a 
couple of questions here. You spoke to--maybe it was Mr. 
Latham--and you said you were going to try to match the 
existing funding with the increase in the enrollment, et 
cetera.
    Is there a question here that there is a problem in the 
field? In other words, that we do not have--that the issue 
becomes the delivery side of USDA and a field force that is 
able to do the job of enrolling and, you know, of utilizing 
those funds at the rapid rate that the Congress has talked 
about these efforts.
    Secretary Vilsack. I am going to draw on my experience as a 
governor to answer that question.
    We tried to institute buffer strips into the State of Iowa. 
And what I learned from that experience was that oftentimes 
when government comes to a farmer and says, ``We have a program 
that is great for you, we want you to participate,'' oftentimes 
there is a little skepticism and cynicism about it. And so, 
what we tried to do is to get a better marketing effort with 
farmer talking to farmer. So it may very well be field, but it 
could also be just general skepticism or a lack of appreciation 
for precisely what the programs provide. I don't know.
    We do have a broad array of options for farmers. And one of 
the things can also be that crop prices, commodity prices 
increase, and you have a bumper year, and all of a sudden you 
are thinking maybe you should take land out of conservation 
reserve and put it into crop production, or maybe you need that 
additional acreage and maybe conservation is not as profitable 
as growing a crop. It could be a wide variety of explanations.
    Ms. DeLauro. Well, I think we--you know, obviously, I think 
that is a big issues for everyone on this committee, is these 
programs, so we will continue to have that conversation.
    Secretary Vilsack. I think you all have made tremendous 
progress, if you look at the number of acres that are involved.
    Ms. DeLauro. Yeah. There is also an issue for me, but I 
will put it on the record, in the last administration, the 
issue of what are the programs that are most cost-effective, 
when Mr. Rey was here and so forth. We have some of that 
language. I would like to get that to you to get your take on 
what he thought was most cost-effective, in terms of some of 
the conservation programs. In any case, I will get that to you.
    Mr. Kingston. Rosa, will you share that answer? That would 
be very interesting for the committee.
    Ms. DeLauro. Oh, sure, yeah, yeah. I would be happy to do 
that.
    Mr. Bishop, do you have any further questions?
    Mr. Bishop. No, I don't.
    Ms. DeLauro. Okay. Mr. Kingston.

               DIRECT FARM SUBSIDY PAYMENTS TO POLLUTERS

    Let me just--because I know you want to do what you need to 
do and we are going to have to vote, as I said, shortly. This 
has to do with the direct payments, which have already been 
addressed. But this is something I wanted to ask from the last 
hearing and never got to do it.
    This was about farm subsidy payments to polluters. This was 
an article, November 2008, ``Questionable Subsidy Payments to 
Polluters.'' ``The Federal Government has awarded millions of 
dollars in subsidies to Oklahoma animal farms that have been 
fined for violating State and Federal environmental laws.'' 
There are about 56 farms penalized by environmental regulators 
for excessive pollution, collected more than $2.5 million in 
subsidies in recent years. Some farms have been fined and 
collected subsidies in the same year. Others are repeat 
offenders, if you will, and they collect subsidies.
    The paper said a dairy was subject of two Oklahoma 
Department of Agriculture fines, 17 now closed U.S. EPA 
enforcement cases, and at least one ongoing EPA case in 2001. 
For these violations, the dairy was fined at least $350,000 for 
failing to comply with environmental laws. The dairy has 
received more than $880,000 in USDA farm subsidies since the 
mid-1990s.
    If we have farms that are violating State and Federal 
environmental quality laws, the taxpayer is being charged 
twice: illegally polluting, and then they receive a farm 
support payment.
    In a response, again, in a prior time, the notion was, 
well, these are two separate things, you know, the pollution is 
one issue, the farm subsidy payment is another. Fines and farm 
subsidies fall into two distinct programs offered by two 
distinct agencies.
    Do you agree that fines for polluting and subsidies should 
not affect one another? Should we be looking at this issue?
    Secretary Vilsack. As you were explaining the circumstance, 
I thought of all the ways in which you could potentially get 
yourself crosswise with environmental laws running an 
agricultural production facility. And some of them can be 
relatively innocent. I mean, they can be just circumstances; 
somebody just didn't do their job on a particular day or 
whatever. And some can be quite intentional and quite 
egregious.
    I think you would have a very slippery slope if you start 
down that track, because I am not quite sure where you stop. So 
what if you haven't filed a proper tax return, you haven't 
reported all of your income, does that disqualify you? What if 
you violate other laws, other criminal laws, does that 
disqualify you?
    I mean, I am not quite sure--I think it is appropriate to 
keep them separate. And if there is a problem with repeat 
violations, then there are ways in which you can substantially 
charge that operation and you can, in some cases, shut it down.
    Ms. DeLauro. Well, but USDA protects wetlands and highly 
erodible soil by limiting subsidy payments to violators 
already.
    Secretary Vilsack. Well, there is a direct connection, 
potentially, there, because you are essentially providing 
resources for conservation and water quality, and you have 
somebody who is basically contaminating the water there. So I 
think there is a greater nexus in that circumstance.
    I am all for holding people accountable, and I am all for 
making sure that environmental laws are strongly and strictly 
enforced. I am just not sure that that is the right penalty.
    Ms. DeLauro. Well, we are going to look at, and I know 
there is a difference of opinion, but we are looking at direct 
payments, which we are going to try to do something about. And 
the presumption there--and, look, I have been a supporter in 
that effort. I am also a supporter of dealing with the IRS data 
in which you can deal with this. But there has been no 
violation in that kind, potentially. These are repeat 
offenders.
    Secretary Vilsack. But just to give you a sense of this, I 
mean, some of these operations have multiple locations, and 
some of them have multiple business arrangements. In other 
words, there may be a partnership here, and there may be a 
limited liability corporation over here, family farm 
corporation over here. That is extraordinarily complex, because 
each one of those entities may be receiving payments, and there 
may be one person who is common to both of them, and that one 
person has a violation. Do you stop payments on both operations 
or just the operation that was directly responsible for the 
violation? I mean----
    Ms. DeLauro. Let me--because I think that this merits a 
greater discussion and conversation. If we can agree to look at 
this issue of people who are--and this comes out of a newspaper 
account, if you will. And, you know, again, as I say, with 
repeat offenders, somebody can make a mistake and, you know, 
not one-size-fits-all, a cookie cutter. But if you continue to 
make the same mistake, and, you know, the outcome is the same, 
there is no real, you know, penalty.
    What I would like to do is have you try to take a look at 
this issue, if you would, and we will as well, and I will as 
well, to see if there is, you know, something here that makes 
it clear to people that if you are going to violate the law 
here and do it repeatedly, well, then you can't just come out 
on the other side of this.
    Secretary Vilsack. I know, in Iowa, when we had habitual 
violator laws, we basically could shut the operation down. That 
seems, to me, to be the more appropriate----
    Ms. DeLauro. Well, it may be. And that is why I am saying 
we need to talk about it. But that is not happening. It is not 
happening. The only thing that is happening is more subsidies 
are going out. That is the result, not shutting it down.
    So what I will do, Mr. Secretary, is I think I have more 
questions, but I will, you know, just submit them for the 
record. And they have to do with COOL and, you know, some other 
areas. And I know some of these--the GIPSA stuff, just a couple 
of questions on that, but I understand the nature of that, for 
the stockyards.
    So I think, with that--any of my colleagues, anything else? 
Okay.
    Thank you very, very much, Mr. Secretary.
    And I want to go back to my original comments. I think this 
is a budget for this effort that we are very excited about. I 
want to stipulate that, and look forward to really working with 
you on a number of these efforts. I think, you know, the budget 
reinforces the priorities of this portfolio in a way that I 
think we can build on and meet the needs and the challenges of 
the people who are out there.
    So thank you very much.
    Secretary Vilsack. Thank you.
    Ms. DeLauro. The hearing is adjourned.

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                           W I T N E S S E S

                              ----------                              
                                                                   Page
Bordallo, Hon. M. Z..............................................   279
Brownell, K. D...................................................     1
Glauber, Joe.....................................................   321
Hall, Hon. John..................................................   298
Kilili, Hon. Gregorio............................................   290
O'Connor, Thomas.................................................     1
Parker, Lynn.....................................................     1
Putnam, Hon. Adam................................................   305
Steele, W. S...................................................135, 321
Vilsack, Hon. Thomas...........................................135, 321














                               I N D E X

                              ----------                              

                      Domestic Nutrition Programs

                                                                   Page
Best Practices of Local Purchases................................   109
Child Nutrition Initiatives......................................   119
Child Nutrition Reauthorization.................................97, 120
Competitive Foods................................................    90
Conflicting Programs.............................................   113
Consolidating School Lunch Programs..............................    86
Environmental Issues.............................................   101
Food Marketing to Children.......................................    97
Fruits and Vegetables in the Nutrition Assistance Programs.......    89
Fruit and Vegetable Program......................................   117
Healthy Incentives Pilot.........................................   103
IOM Nutrition Standards..........................................    94
Nutritional Quality of Commodity Programs........................   117
Nutrition Education..............................................    43
Obesity and School Nutrition Programs............................    92
Opening Remarks, Chairwoman DeLauro..............................     1
Opening Statement, Witnesses.....................................     2
Organic Foods....................................................    92
Overpayments in School Meal Programs.............................    82
Questions for the Record Submitted by Representative Boyd........   134
Questions for the Record Submitted by Representative Kaptur......   122
SNAP Payment Frequency...........................................   104
SNAP Purchases...................................................    93
Vending Machines in Schools......................................   114
Wellness Policies................................................    99
WIC Food Package.................................................   115
Written Statement, Mr. O'Connor..................................     6
Written Statement, Dr. Brownell..................................    22
Written Statement, Ms. Parker....................................    31

      Department of Agriculture Hearing (Secretary of Agriculture)

2008 Farm Bill Funding...........................................   140
502 Direct Loans.................................................   192
Alternative Energy Initiatives...................................   209
Animal Identification............................................   227
Agricultural Concentration.......................................   197
Agriculture Research Station.....................................   225
Child Nutrition Programs.......................................179, 204
Civil Rights Actions.............................................   183
Civil Rights Policy..............................................   144
Closing Remarks..................................................   230
Conserving Agricultural Property.................................   213
Dietary Guidelines...............................................   190
Developing Energy Markets........................................   186
Earmark Elimination/Program Terminations.........................   208
Elimination of Lower Priority Programs...........................   195
Elimination of Congressional Earmarks............................   193
Emerald Ash Borer................................................   201
Farm Bill Pest and Disease Funding...............................   206
Farm and Non-farm Income Tests...................................   207
Farm Storage Facility Loans......................................   203
Farm Subsidy Payments to Polluters...............................   229
Farm Payments....................................................   181
Farm Payments Limits.............................................   202
FNS Erroneous Payment Study......................................   195
Food-Borne Illnesses.............................................   176
Food Recalls.....................................................   178
Food Safety and Security.........................................   196
Formula Funding..................................................   198
Increase in Ethanol Blend Rate...................................   199
Information Technology.........................................226, 228
Local Farms......................................................   212
Local Specialty Crops............................................   224
McGovern-Dole Feeding Program....................................   214
Market Development Activities in Cuba............................   214
Mexican Trucking Pilot Program...................................   226
National Animal Identification Program...........................   221
New Technologies.................................................   142
Opening Remarks, Chairwoman DeLauro..............................   135
Opening Statement, Ranking Member Kingston.......................   137
Opening Statement, Secretary Vilsack.............................   138
Peanut and Cotton Loan Programs..................................   184
Pistachios.......................................................   177
Questions for the Record Submitted by Representative Bishop......   255
Questions for the Record Submitted by Representative Boyd........   252
Questions for the Record Submitted by Representative Kaptur......   266
Questions for the Record Submitted by Ranking Member Kingston....   241
Questions for the Record Submitted by Chairwoman DeLauro.........   231
Risk-based Assessment Pilot Project..............................   173
Rural America Initiatives........................................   183
Rural Broadband................................................185, 223
Rural Energy for America.........................................   219
Rural Housing Application Backlog................................   199
Rural Housing....................................................   211
Rural Water and Wastewater Systems...............................   192
School Food Purchases............................................   216
School Lunch Programs............................................   187
School Lunch Program Overpayments................................   206
School Vending Machines..........................................   223
Small Farm Producers.............................................   191
Supplemental Nutrition Assistance Program.................189, 220, 225
Supplemental Revenue Assistance Program..........................   228
Trade Issues.....................................................   210
USDA Economic Stimulus Funding...................................   139
USDA Key Priorities..............................................   141
Urban Food Deserts...............................................   200
Urban and Rural Development......................................   213
User Fee Proposal................................................   193
Vending Machines in Schools......................................   210
Written Statement, Secretary Vilsack.............................   145

                    Testimony of Members of Congress

Testimony of Representative Bordallo.............................   279
Testimony of Representative Hall (NY)............................   298
Testimony of Representative Putnam...............................   305
Testimony of Representative Sablan...............................   290
Written Statement, Representative Bordallo.......................   283
Written Statement, Representative Hall (NY)......................   300
Written Statement, Representative Putnam.........................   307
Written Statement, Representative Sablan.........................   292

                        Secretary of Agriculture

2010 Proposed Cuts...............................................   356
Agricultural Credit Insurance Fund...............................   397
Agricultural Production..........................................   327
Agriculture and Food Research Initiative.........................   383
Assistant Secretary for Administration...........................   381
Broadband Infrastructure Investments.............................   373
Broadband Maps...................................................   374
Broadband Program Budget Request.................................   372
Civil Rights...................................................328, 380
Conservation Funding.............................................   398
Conservation Program Cuts........................................   364
Crop Insurance...................................................   382
Direct Farm Subsidy Payments to Polluters........................   399
Effects of H1N1 on the Pork Industry.............................   381
Environmental Services Markets...................................   326
Factory Farms....................................................   367
Farm Safety Net..................................................   327
Food Safety......................................................   325
Food Safety Assessment Schedule..................................   397
Food Safety Inspections..........................................   360
Food Safety Working Group........................................   366
Food Safety Regulations..........................................   367
Hunger-Free Community Grants Request.............................   378
Indirect Land Use................................................   365
International Food Assistance..................................326, 369
Liberalizing Trade with Cuba.....................................   396
Market Access Program............................................   393
National Animal Identification System.....................361, 376, 377
National Leafy Green Marketing Program...........................   371
Nutrition Assistance.............................................   379
Nutrition Programs...............................................   325
Opening Statement, Chairwoman DeLauro............................   321
Opening Statement, Ranking Member Kingston.......................   323
Opening Statement, Secretary Vilsack.............................   324
Plant Pest Management Practices..................................   370
President's FY2010 Budget........................................   325
Questions for the Record Submitted by Representative Boyd........   416
Questions for the Record Submitted by Representative Farr........   402
Questions for the Record Submitted by Representative Kaptur......   419
Recovery Act Implementation......................................   324
Renewable Energy.................................................   326
Research.........................................................   327
Research Earmarks Funding Cuts...................................   363
Rural Broadband Programs.........................................   392
Rural Development................................................   326
Rural Single Family Housing......................................   368
RUS (ARRA) Broadband Program.....................................   375
School Nutrition Programs........................................   393
Trade............................................................   326
Undersecretary of Food Safety....................................   396
USDA Programs Savings............................................   395
WIC..............................................................   357
WIC Contingency Fund.............................................   357
Written Statement, Thomas Vilsack................................   330

                                  
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