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


 
    HEARING TO REVIEW IMPLEMENTATION OF THE HORTICULTURE AND ORGANIC 
  AGRICULTURE TITLE OF THE FOOD, CONSERVATION, AND ENERGY ACT OF 2008 

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                  HORTICULTURE AND ORGANIC AGRICULTURE

                                 OF THE

                        COMMITTEE ON AGRICULTURE
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

                            OCTOBER 28, 2009

                               __________

                           Serial No. 111-34


          Printed for the use of the Committee on Agriculture
                         agriculture.house.gov

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                        COMMITTEE ON AGRICULTURE

                COLLIN C. PETERSON, Minnesota, Chairman

TIM HOLDEN, Pennsylvania,            FRANK D. LUCAS, Oklahoma, Ranking 
    Vice Chairman                    Minority Member
MIKE McINTYRE, North Carolina        BOB GOODLATTE, Virginia
LEONARD L. BOSWELL, Iowa             JERRY MORAN, Kansas
JOE BACA, California                 TIMOTHY V. JOHNSON, Illinois
DENNIS A. CARDOZA, California        SAM GRAVES, Missouri
DAVID SCOTT, Georgia                 MIKE ROGERS, Alabama
JIM MARSHALL, Georgia                STEVE KING, Iowa
STEPHANIE HERSETH SANDLIN, South     RANDY NEUGEBAUER, Texas
Dakota                               K. MICHAEL CONAWAY, Texas
HENRY CUELLAR, Texas                 JEFF FORTENBERRY, Nebraska
JIM COSTA, California                JEAN SCHMIDT, Ohio
BRAD ELLSWORTH, Indiana              ADRIAN SMITH, Nebraska
TIMOTHY J. WALZ, Minnesota           ROBERT E. LATTA, Ohio
STEVE KAGEN, Wisconsin               DAVID P. ROE, Tennessee
KURT SCHRADER, Oregon                BLAINE LUETKEMEYER, Missouri
DEBORAH L. HALVORSON, Illinois       GLENN THOMPSON, Pennsylvania
KATHLEEN A. DAHLKEMPER,              BILL CASSIDY, Louisiana
Pennsylvania                         CYNTHIA M. LUMMIS, Wyoming
ERIC J.J. MASSA, New York
BOBBY BRIGHT, Alabama
BETSY MARKEY, Colorado
FRANK KRATOVIL, Jr., Maryland
MARK H. SCHAUER, Michigan
LARRY KISSELL, North Carolina
JOHN A. BOCCIERI, Ohio
SCOTT MURPHY, New York
EARL POMEROY, North Dakota
TRAVIS W. CHILDERS, Mississippi
WALT MINNICK, Idaho

                                 ______

                           Professional Staff

                    Robert L. Larew, Chief of Staff

                     Andrew W. Baker, Chief Counsel

                 April Slayton, Communications Director

                 Nicole Scott, Minority Staff Director

                                 ______

          Subcommittee on Horticulture and Organic Agriculture

                DENNIS A. CARDOZA, California, Chairman

ERIC J.J. MASSA, New York            JEAN SCHMIDT, Ohio, Ranking 
JIM COSTA, California                Minority Member
KURT SCHRADER, Oregon                JERRY MORAN, Kansas
FRANK KRATOVIL, Jr., Maryland        TIMOTHY V. JOHNSON, Illinois
SCOTT MURPHY, New York               CYNTHIA M. LUMMIS, Wyoming

                Keith Jones, Subcommittee Staff Director

                                  (ii)




















                             C O N T E N T S

                              ----------                              
                                                                   Page
Cardoza, Hon. Dennis A., a Representative in Congress from 
  California, opening statement..................................     1
    Prepared statement...........................................     3
Peterson, Hon. Collin C., a Representative in Congress from 
  Minnesota, prepared statement..................................     5
Schmidt, Hon. Jean, a Representative in Congress from Ohio, 
  opening statement..............................................     4

                                Witness

Pegg, Rayne, Administrator, Agricultural Marketing Service, U.S. 
  Department of Agriculture, Washington, D.C.; accompanied by 
  Cindy Smith, Administrator, Animal and Plant Health Inspection 
  Service, U.S. Department of Agriculture........................     6
    Prepared statement...........................................     8
    Supplementary material.......................................    23


    HEARING TO REVIEW IMPLEMENTATION OF THE HORTICULTURE AND ORGANIC
  AGRICULTURE TITLE OF THE FOOD, CONSERVATION, AND ENERGY ACT OF 2008

                              ----------                              


                      WEDNESDAY, OCTOBER 28, 2009

                  House of Representatives,
          Subcommittee on Horticulture and Organic 
                                       Agriculture,
                                  Committee on Agriculture,
                                                   Washington, D.C.
    The Subcommittee met, pursuant to call, at 10:03 a.m., in 
Room 1300, Longworth House Office Building, Hon. Dennis A. 
Cardoza [Chairman of the Subcommittee] presiding.
    Members present: Representatives Cardoza, Costa, Schrader, 
Murphy, Schmidt, and Moran.
    Staff present: Christy Birdsong, Alejandra Gonzalez-Arias, 
Keith Jones, John Konya, Scott Kuschmider, James Ryder, 
Patricia Barr, John Goldberg, Pam Miller, Jamie Mitchell, and 
Sangina Wright.

 OPENING STATEMENT OF HON. DENNIS A. CARDOZA, A REPRESENTATIVE 
                  IN CONGRESS FROM CALIFORNIA

    The Chairman. Ladies and gentlemen, welcome. The appointed 
hour having arrived, I would like to call this hearing of the 
Subcommittee on Horticulture and Organic Agriculture to review 
the implementation of the Horticulture and Organic Agriculture 
Title of the Food, Conservation, and Energy Act of 2008. The 
hearing will now come to order.
    We will start with opening statements. I will begin with my 
opening statement and then I will turn it over to my Ranking 
Member, Mrs. Schmidt.
    I want to thank you all for taking the time out of your 
busy schedules to attend today's important hearing and to 
review the Department of Agriculture's performance in employing 
what we refer to fondly as the farm bill.
    The 2008 Farm Bill was a landmark in United States 
agriculture policy for many reasons, but perhaps none as 
important as its recognition of specialty crops, including 
fruit, vegetables, tree nuts, floriculture, nursery crops, and 
organic agriculture. The 2008 Farm Bill dedicates almost $3 
billion in funding over 5 years to areas of critical importance 
to these sectors, including nutrition, research, pest and 
disease, trade, conservation, and expansion of market 
operations and opportunities.
    For the first time, the 2008 Farm Bill established a 
separate title to deal with, specifically, issues related to 
specialty crops and organic agriculture. It is within Title X 
that these sectors of American agriculture find their home in a 
proper place in the living history of U.S. agriculture policy.
    Congress took this long overdue action for many reasons. 
First, specialty crops make up a substantial share of U.S. 
cropland value. In 2006, specialty crops were grown on only 
four percent of the total harvested cropland, but they 
accounted for $53 billion, or 44 percent, of U.S. crop 
receipts.
    Second, specialty crops represent the great diversity of 
production across the United States. For example, California, 
Florida, and Texas harvest the largest share of fresh fruit, 
vegetables, and melon acreage. California is the largest 
producer of grapes, strawberries, peaches, nectarines, 
avocados, kiwifruit, and leads in fresh market orange 
production and tree nut production.
    The Upper Midwest and Northwest have the largest vegetable 
acreage for processing. Florida is the largest producer of 
citrus and citrus juices. Washington is the largest producer 
for both fresh and processing apples. Midwestern and 
northeastern states such as Ohio, and New York are other 
important producers of fresh fruits and vegetables. 
Floriculture production takes place in over 40 different 
states. Nursery crops are produced in 17 states, with Oregon 
and Pennsylvania leading the pack.
    The growing consumer demand for locally grown foods is 
causing states like Maryland to increase fruit and vegetable 
production as well. To ignore these important states and their 
vital crops would have been irresponsible and bad policy.
    Furthermore, despite predictions of a slump in consumer 
demand due to economic distress, organic food sales are 
actually bucking the trend, and in the United States grew by 15 
percent in 2008, to $22.9 billion. Organic food sales now count 
for approximately 3.5 percent of all U.S. food products sold in 
the country.
    These impressive statistics underline the importance of 
developing and implementing policies that will continue to 
encourage growth in these sectors. There is likely no one at 
this dais or in the audience who doesn't remember our mothers 
telling us to eat your fruits and vegetables daily.
    A growing body of research shows that fruits and vegetables 
are critical to promoting good health. Over the past 30 years 
or so, researchers have developed a solid base of science to 
back up what generations of our mothers predicted and preached: 
that eating your fruits and vegetables is one of the tried and 
true recommendations for a healthy diet. I wish I had listened 
more to mom.
    Today's panel is narrowly focused on specialty crop 
provisions within Title X, so as to permit Subcommittee Members 
ample time to discuss the implementation process with USDA. It 
is my intent to hold other more expansive hearings on issues 
related to Title X in the future.
    I am particularly interested to receive input and 
comprehensive data from AMS on the National Organic Program, 
given the program's new leadership and improved funding 
sources.
    In closing, I view this hearing like a farmer's first walk 
through the field after a planting. In the farm bill, we 
planted seeds for new emphasis on specialty crops and organic 
agriculture. Today, we will examine what has sprouted. We are 
anxious to see what USDA is doing to cultivate these new 
programs, and look forward to an abundant harvest.
    [The prepared statement of Mr. Cardoza follows:]

   Prepared Statement of Hon. Dennis A. Cardoza, a Representative in 
                        Congress from California
    Thank you for taking time from your very busy schedules to attend 
today's important hearing to review the Department of Agriculture's 
performance in implementing the Horticulture and Organic Agriculture 
Title of The Food, Conservation, and Energy Act of 2008.
    The 2008 Farm Bill was a landmark in U.S. agricultural policy for 
many reasons, but perhaps none as important as its recognition of 
specialty crops including fruit, vegetables, tree nuts, floriculture, 
and nursery crops, and organic agriculture.
    The 2008 Farm Bill dedicates almost $3 billion in funding over 5 
years to areas of critical importance to these sectors including 
nutrition, research, pest and disease management, trade, conservation 
and expansion of market opportunities.
    For the first time, the 2008 Farm Bill established a separate title 
to deal specifically with issues related to specialty crops and organic 
agriculture. It is within Title X that these sectors of American 
agriculture find their home and proper place in the living history of 
U.S. agriculture policy.
    Congress took this long overdue action for many reasons. First, 
specialty crops make up a substantial share of U.S. cropland production 
value. In 2006, specialty crops were grown on only 4% of the total 
harvested cropland, but they accounted for $53 billion or 44% of total 
U.S. crop receipts.
    Second, specialty crops represent the great diversity of production 
across the United States. For example, California, Florida and Texas 
harvest the largest share of fresh vegetable and melon acreage. 
California is the largest producer of grapes, strawberries, peaches, 
nectarines, avocados, and kiwifruit and leads in fresh-market orange 
production and tree nut production.
    The Upper Midwest and Northwest have the largest vegetable acreage 
for processing. Florida is the largest producer of citrus and citrus 
juices.
    Washington is the largest apple producer for both fresh and 
processing. Midwestern and northeastern states such as Ohio and New 
York are other important producers of fruits and vegetables.
    Floriculture production takes place in 40 different states. Nursery 
crops are produced in 17 states with the Oregon, and Pennsylvania 
leading the pack.
    The growing consumer demand for locally grown foods are causing 
states like Maryland to increase fruit and vegetable production. To 
ignore these important states and their vital crops would have been 
irresponsible and bad policy.
    Furthermore, despite predictions of a slump in consumer demand due 
to economic distress, organic food sales in the U.S. grew by 15 percent 
in 2008 to $22.9 billion. Organic food sales now account for 
approximately 3.5 percent of all food product sales in the United 
States.
    These impressive statistics underline the importance of developing 
and implementing policies that will continue to encourage growth in 
these sectors.
    There is likely no one at the dais or in the audience who doesn't 
remember our mothers telling us to ``Eat your fruits and vegetables''.
    A growing body of research shows that fruits and vegetables are 
critical to promoting good health. Over the past 30 years or so, 
researchers have developed a solid base of science to back up what 
generations of mothers preached: that eating fruits and vegetables is 
one of the tried and true recommendations for a healthy diet.
    Today's panel is narrowly focused on the specialty crop provisions 
within Title X, so as to permit Subcommittee Members ample time to 
discuss the implementation process with USDA.
    It is my intent to hold other, more expansive hearings, on issues 
related to Title X. I am particularly interested to receive a 
comprehensive update from AMS on the National Organic Program, given 
the program's new leadership and improved funding.
    In closing, I view this hearing like a farmer's first walk through 
the field after planting.
    In the farm bill, we planted the seeds for a new emphasis on 
specialty crops and organic agriculture. Today we'll examine what has 
sprouted.
    We're anxious to see what USDA is doing to cultivate these new 
programs, and look forward to an abundant harvest.
    With that, I now yield time to Ranking Member Schmidt for her 
opening statement.

    The Chairman. With that, I will now yield time to Ranking 
Member Schmidt for her opening comments.

  OPENING STATEMENT OF HON. JEAN SCHMIDT, A REPRESENTATIVE IN 
                       CONGRESS FROM OHIO

    Mrs. Schmidt. Thank you, Mr. Chairman, and thank you for 
holding this hearing to review the implementation of the 
Horticulture and Organic Agriculture title of the 2008 Farm 
Bill.
    While specialty crop and organic producers also benefit 
from programs contained in other titles of the farm bill, I 
understand today we will hear from the USDA specifically on 
those programs within Title X. Many of these programs were in 
place prior to this farm bill, and I look forward to hearing 
how the USDA has built upon the original framework to expand 
these programs and implement those that are new.
    Specialty crop and organic producers across the nation have 
the opportunity to benefit from the farm bill, but only if the 
integrity of the programs is protected. U.S. producers work 
hard to provide consumers with a variety of safe and abundant 
food. It is crucial that we all do our part by ensuring these 
programs are implemented in a timely and appropriate manner.
    Outside of the farm bill, there is another new initiative 
underway at the USDA called Know Your Farmer, Know Your Food, 
to promote sustainable local and regional food systems that 
support small and midsize operations. This initiative is not 
part of the farm bill, but it has been incorporated into the 
Farmers Market Promotion Program, the Specialty Crop Block 
Grant Program, and elsewhere.
    While I certainly support small- and medium-sized farmers 
marketing their commodities locally, in reading the USDA's 
press material on the initiative, it makes me wonder if this 
Administration is choosing one sector of the agricultural 
community over another.
    The Food and Agricultural Organization has stated that food 
production will have to rise 70 percent in the next 4 decades 
to feed the world by 2050. With information like this coming 
from the United Nations Voice for World Food and Agricultural 
Needs, it is important that the USDA support all producers, 
regardless of their size or how far they transport their 
products to market, if we are going to meet such a high demand.
    I look forward to hearing from the USDA today on the 
progress that has been made to implement the horticulture and 
organic provisions of the farm bill.
    I thank the witnesses for joining us, and I yield back my 
time.
    The Chairman. Thank you, Mrs. Schmidt. I appreciate your 
testimony. The chair would request that other Members submit 
their opening statements for the record.
    [The prepared statement of Mr. Peterson follows:]

  Prepared Statement of Hon. Collin C. Peterson, a Representative in 
                        Congress from Minnesota
    I want to echo Chairman Cardoza's opening statement and thank him 
and Ranking Member Schmidt for their leadership on this Subcommittee. I 
also want to thank both of them for their work in the last Congress in 
helping pass a farm bill with a strong Horticulture and Organic 
Agriculture title. I look forward to hearing from USDA this morning 
about implementation of the title thus far, and what remains to be 
accomplished.
    This Subcommittee was created at the beginning of the 110th 
Congress in order to focus more attention on specialty crops, organic 
agriculture, and local food networks, all of which are sectors of the 
farm economy that continue to show promise because of the potential for 
improved bottom lines for farmers, even in tough economic times.
    The 2008 Farm Bill was the first to include a title for fruit and 
vegetable production, and I believe the bill is responsible for a lot 
of great things that have yet to be recognized and fully appreciated. 
The farm bill provided over $450 million in mandatory funding to expand 
the specialty crop block grant program, increasing the amount of USDA 
purchases of fruits and vegetables for use in school lunch and other 
feeding programs.
    The farm bill expanded access to locally grown food via expansion 
of the Farmers' Market Promotion Program and by providing new resources 
to combat the prevalence of urban food deserts. The farm bill provided 
new funding to support organic farmers as well as farmers who want to 
move into organic production. We helped fruit and vegetable producers 
address food safety, pest and disease management issues, and we poured 
resources into studying and combating Colony Collapse Disorder, which 
has been a chief concern of specialty crop producers nationwide.
    With expansion of existing programs and the creation of new ones, 
now is a good time to take stock of where we are at with implementation 
and what we can expect in the near future.
    Many of these programs are important not only to my district, but 
they are of great interest to many of us in Congress. Just about every 
state has some form of dedicated commercial specialty crop production. 
And areas like value-added agriculture and local food networks hold 
great promise as economic engines for rural communities everywhere. In 
my district, for example, there is a growing market demand for local 
food supplies, which is why I have already sponsored two local food 
conferences and will be doing so once again next February.
    I am proud of what we did in the farm bill to assist growers who 
want to tap into these new opportunities. I look forward to Chairman 
Cardoza and Ranking Member Schmidt examining Title X in greater detail 
in future hearings.
    I commend them again for their leadership, I welcome today's USDA 
witnesses and I yield back my time.

    The Chairman. I would like to call forward our witnesses 
today. It gives me great pleasure to introduce and welcome a 
fellow Californian to the hearing this morning.
    We have with us today Rayne Pegg, Administrator of USDA's 
Agricultural Marketing Service, who will be presenting 
testimony on behalf of USDA. She is joined this morning at the 
witness table by Cindy Smith, Administrator of the Animal and 
Plant Health Inspection Service. Ms. Smith, we are pleased to 
welcome you as well.
    I have to tell the assembled folks here, and I am sure it 
will get back to them, when I first welcomed the Secretary and 
Deputy Secretary Merrigan, I told them they were fine people, 
they just weren't from California. That was a big problem in my 
book.
    I will tell you since then, that they have just been 
fabulous and they have came out to visit us, and I really 
appreciated getting to know them and I consider them friends. 
And I think that is a major accomplishment after this short a 
period of time. I think that they are doing a very admirable 
job at the Department, but it's always great to have a 
Californian in the Department.
    Ms. Pegg, you are welcome to begin your testimony. Welcome 
to the Committee.

            STATEMENT OF RAYNE PEGG, ADMINISTRATOR,
AGRICULTURAL MARKETING SERVICE, U.S. DEPARTMENT OF AGRICULTURE, 
 WASHINGTON, D.C.; ACCOMPANIED BY CINDY SMITH, ADMINISTRATOR, 
 ANIMAL AND PLANT HEALTH INSPECTION SERVICE, U.S. DEPARTMENT OF
                          AGRICULTURE

    Ms. Pegg. Thank you very much. It is a great introduction. 
Thank you, Chairman Cardoza and Ranking Member Schmidt, for the 
opportunity to update you on the implementation of Title X of 
the farm bill. Cindy Smith is joining me today to answer any 
APHIS-specific questions.
    The farm bill provided the Department with a roadmap for 
addressing many of the challenges that rural America is facing 
today. It is the foundation of many of the Department's 
initiatives to bring wealth to rural America, and implementing 
the farm bill is one of the Secretary's top priorities.
    I want to update you on the activities regarding section 
32. An independent study and evaluation of the purchasing 
processes of section 32 is underway and is expected to be out 
in January 2010. Using section 32 funds, AMS purchased 
approximately $472 million in fruits and vegetables in 2009. 
Our total USDA purchases, using all our funding sources for 
fruits and vegetables, was over $640 million in 2009.
    Many of the grant programs under Title X are focused on 
making more specialty crops available to consumers and tackling 
the challenges that growers are facing. Many of these programs 
support the Department's Know Your Farmer, Know Your Food 
initiative.
    The bill extended the Farmers Market Promotion Program to 
2012, and this has been an extremely popular program. Recently, 
we received over 450 applications for this grant program and we 
only awarded 86 grants and distributed more than $4.5 million 
in 2009; eighteen percent of those funds went to support EBT 
projects throughout the United States. This exceeded the ten 
percent requirement in the farm bill that funds be used to 
support electronic benefits transfer at farmers' markets.
    AMS also administers a Specialty Crops Block Grant Program 
which has been extremely successful for states to tackle the 
challenges its growers are facing and make them competitive in 
the coming years. USDA administers the program according to the 
statute and regulations, and recently announced approximately 
$49 million in 2009 for 745 projects. In 2010 through 2012, $55 
million will be available. To ensure that states have more time 
to develop grants and receive funds in 2010, next month, we 
will be announcing the availability of funds in 2010, with 
applications due in June of 2010.
    Providing market information to growers is an important 
tool in making business decisions. AMS has enhanced market news 
systems for organic products as well as specialty crops.
    Congress and the Administration recognize the National 
Organic Program needs more resources due to the growth in 
organic industry and the importance of protecting its 
integrity. Many changes to the program have been made. In 
Fiscal Year 2009, Congress appropriated $3.86 million, and in 
2010 increased that funding to a total of $6.96 million. The 
program is undergoing an independent audit and peer review by 
the National Institute of Standards and Technology.
    It became an independent program within AMS, giving it more 
visibility in the Department. We hired Miles McEvoy as the 
Deputy Administrator to the program. He brings 20 years of 
experience in the organic industry.
    Over the course of the next 6 months, we will be hiring ten 
additional staff for the program. This will greatly increase 
the staffing of the program, strengthening the enforcement and 
compliance components within the National Organic Program.
    AMS implemented the National Organic Certification Cost-
Share Program, as required in the farm bill. We increased 
reimbursement from $500 to $750, and in 2009 we distributed 
$4.3 million. In October of 2009, we announced the availability 
of funds for Fiscal Year 2010. We recognize there have been 
some issues with the distribution of funds through this 
program, and AMS is addressing this issue and working on 
getting funds out more quickly to states.
    AMS carried out the provisions in the farm bill that 
addressed many of the issues our domestic apiary producers are 
dealing with. A national research and promotion program for 
honey packers and importers was established in May 2008. With 
the approval of that program, a termination of the previous 
order was done in April 2009.
    AMS is currently reviewing comments to establish a research 
and promotion program for domestic producers, and country-of-
origin labeling for honey products became effective in October 
2009.
    For APHIS, we appreciate the attention paid in the farm 
bill to addressing the devastating plant pests and diseases 
that can cause significant damage to our agricultural and 
natural resources. Invasive threats such as the emerald ash 
borer, Asian citrus psyllid, sudden oak death, and many more, 
have no jurisdictional bounds, and it takes a comprehensive 
team approach to combat them effectively.
    In 2009, APHIS allocated full funding of $12 million and 
worked in cooperation with the National Plant Board, Federal, 
state, academic, and other organizations to develop a 5 year 
strategic plan to implement the plant pest and disease and 
disaster management provision of the farm bill. This strategy 
is focused on enhancing pest survey and identification tools, 
and increasing outreach and education to the public on the 
importance of our eradication and control programs.
    APHIS has also made significant progress in addressing the 
agency's regulation of the products of biotechnology. We are 
now considering the public input as we decide on the best way 
to move forward. Our goal is to ensure that now and in the 
future, our regulations will always be strong enough to meet 
the demands of this science.
    Thank you for the opportunity to give an update to the 
Committee. We are available for questions.
    [The prepared statement of Ms. Pegg follows:]

Prepared Statement of Rayne Pegg, Administrator, Agricultural Marketing 
       Service, U.S. Department of Agriculture, Washington, D.C.
    Chairman Cardoza, Ranking Member Schmidt and Members of the 
Subcommittee, thank you for inviting me to appear before you today at 
this hearing to review the U.S. Department of Agriculture's (USDA) 
implementation of the Horticulture and Organic Agriculture Title (Title 
X) of the Food, Conservation, and Energy Act of 2008 (Farm Bill).
    USDA's Agricultural Marketing Service (AMS) and the Animal and 
Plant Health Inspection Agency (APHIS) are the primary agencies with 
responsibility for implementing Title X. However, there are three 
sections in this title which are the responsibility of the Farm Service 
Agency, the Forest Service, and the National Agricultural Statistics 
Service. APHIS Administrator Cindy Smith is here with me today to 
answer any APHIS-specific questions that you might have.
    I can assure the Subcommittee that one of Secretary Vilsack's top 
priorities is ensuring that the 2008 Farm Bill is implemented as 
expeditiously as possible following the intent of Congress as enacted 
in the statute. This Administration is also committed to the importance 
of fresh, nutritious food and raising the profile of locally grown 
food, including specialty crops and organic agriculture. President 
Obama has made a safe, sustainable, and nutritious food supply a 
central goal for USDA.
    USDA has implemented all of the programs authorized by the farm 
bill for which funding was provided. Finally, the provisions of the 
farm bill that relate to quality requirements for Clementines and a 
marketing order for Hass Avocados, have not been implemented as both 
provisions require that an industry proposal be submitted to USDA to 
initiate implementation. To date, no proposals have been submitted.
Subtitle A--Horticulture Marketing and Information
    AMS administers the two grant programs covered in subtitle A. The 
Specialty Crop Block Grant Program provides funding to states and 
territories to enhance the competiveness of specialty crops. Sec. 10109 
provided the program funding levels from the Commodity Credit 
Corporation (CCC) for Fiscal Years 2008 through 2012, added 
horticulture to the definition of specialty crop, and added Guam, 
American Samoa, the U.S. Virgin Islands and the Commonwealth of the 
Northern Mariana Islands to the list of ``states'' eligible to apply 
for grants. These changes required AMS to undertake rulemaking which 
was completed on March 27, 2009 with the publication of the final rule 
in the Federal Register. In this final rule, AMS, per the language in 
the Farm Bill's Managers Statement, required state departments of 
agriculture to describe their outreach efforts to specialty crop 
producers, including socially disadvantaged and beginning farmers, and 
describe their efforts to conduct a competitive process to ensure 
maximum public input and benefit.
    Through the funding provided in the farm bill for specialty crop 
block grants, AMS awarded 56 grants totaling $9.5 million in Fiscal 
Year 2008 and approximately $49 million for 745 projects in Fiscal Year 
2009. Nearly all of the funds were awarded to benefit small- and 
medium-sized specialty crop farmers. Many of these projects focused on 
the development of low- and middle-size farmers through agricultural 
training opportunities, promotional and cost-share assistance, and 
community network development.
    The other AMS grant program covered in Subtitle A is the Farmers 
Market Promotion Program (FMPP), which works to help improve and expand 
domestic farmers markets, roadside stands, community-supported 
agriculture programs, agri-tourism activities, and other direct 
producer-to-consumer market opportunities. Sec. 10106 of the farm bill 
provided CCC funds for Fiscal Years 2008 through 2012, specified 
statutorily the categories of farmer-to-consumer direct marketing 
activities eligible for funding under the program, and required that 
not less than ten percent of the funds used to carry out the program in 
a fiscal year are to be used to support the use of electronic benefits 
transfers (EBT) at farmers' markets.
    AMS awarded 85 FMPP grants totaling $3.5 million and covering 43 
states in Fiscal Year 2008. The 85 awards went to 63 nonprofit 
organizations, 12 local governments, six agriculture cooperatives, two 
Tribal governments, one economic development corporation, and one 
farmers market authority. Over $385,000 or 11.2 percent of the funds 
awarded involved EBT activities, thus meeting the required threshold. 
For Fiscal Year 2009, AMS awarded 86 grants totaling more than $4.5 
million covering 37 states. The 86 awards went to 65 nonprofit 
organizations, 16 local governments, two agriculture cooperatives, two 
Tribal governments, and one producer network. Thirty of the 86 grants 
promote the use of new EBT projects.
    As with the grant programs, USDA has made great strides in 
implementing the other provisions in Subtitle A. Sec. 10104 allowed for 
the development of a program for good agricultural practices and good 
handling practices under the Mushroom Promotion, Research and Consumer 
Information Order, as well as reapportioned the membership of the 
Mushroom Council to reflect shifts in domestic mushroom production. AMS 
published the final rule implementing these provisions in the Federal 
Register on October 2, 2009.
    Sec. 10101 required USDA to arrange for an independent study and 
evaluation of the purchasing processes principally devoted to 
perishable agricultural commodities provided in section 32 of the Act 
of August 24, 1935 (Sec. 32). AMS signed a cooperative agreement with 
the University of California--Davis on September 19, 2008. The study 
will examine the budgetary, statutory, and regulatory authority 
underlying the processes used by the Department to make purchases under 
Sec. 32. A preliminary report will be made available in January of 
2010.
    Sec. 10103 directed USDA to include, beginning in 2008, specialty 
crops in the census of agriculture. USDA's National Agricultural 
Statistics Service (NASS) met this requirement when conducting the 2007 
Census of Agriculture during calendar year 2008. Also, it should be 
noted that this December, NASS will begin collecting data for the 
Census of Horticultural Specialties, conducted once every 10 years, 
which provides a comprehensive and detailed picture of U.S. 
floriculture, nursery and specialty crop operations.
Subtitle B--Pest and Disease Management
    We appreciate the attention paid in the farm bill to addressing the 
devastating plant pests and diseases that can cause significant damage 
to our agricultural and natural resources. Invasive threats such as the 
emerald ash borer, Asian citrus psyllid, sudden oak death disease, and 
Asian longhorned beetle know no jurisdictional bounds, and it takes a 
comprehensive, team approach to combat them effectively. In close 
cooperation with the National Plant Board, Federal, state, academic, 
and tribal groups, and specialty crop and other industry organizations, 
our Animal and Plant Health Inspection Service (APHIS) has developed a 
5 year strategy to implement the plant pest and disease and disaster 
management provision of the farm bill. This strategy focuses on six key 
areas:

    (1) enhancing plant pest and disease analysis and survey;

    (2) targeting domestic inspection activities at vulnerable points;

    (3) enhancing pest identification tools and technology;

    (4) developing programs to safeguard nursery production;

    (5) enhancing outreach and education to increase public 
        understanding and support of plant pest and disease eradication 
        and control programs; and

    (6) enhancing mitigation capabilities.

    APHIS allocated full funding in FY 2009--$12 million, as called for 
in the farm bill--to carry out this program. Throughout the summer, 
APHIS conducted webinars, online surveys, and face-to-face meetings 
with state partners and other stakeholders to gain input in developing 
the spending plan for FY 2010. The enhanced resources provided through 
the farm bill will position APHIS to develop a more proactive approach 
to plant health protection, solidify partnerships with stakeholders, 
and enable meaningful advances in our pest detection infrastructure. 
The net effect of improving our ability to detect and respond to a 
plant pest or disease in the early stages of an introduction is 
significant cost savings for taxpayers and U.S. agriculture, as it 
avoids the high costs of a long-term management program and helps 
maintain access to international markets for U.S. producers.
    Hand-in-hand with our goal of protecting U.S. agriculture from 
plant pests and diseases is the need to provide reliable sources of 
healthy planting stock for specialty crops. APHIS, the Agricultural 
Research Service, and the National Institute of Food and Agriculture 
have made significant strides in forming the National Clean Plant 
Network (NCPN), as directed by the farm bill. In March 2009, the three 
USDA Agencies signed a Memorandum of Understanding laying the 
foundation for the NCPN at the national level and providing direction 
and guidance for newly forming NCPN specialty crop networks. Two 
commodity networks--the Fruit Tree Clean Plant Network and the Grape 
Clean Plant Network--are currently part of the NCPN, and USDA funded 
five key clean plant centers in FY 2009. There is increasing interest 
for other specialty crops to become part of the NCPN, with organizing 
meetings for citrus, berries (strawberries, blueberries, cranberries 
and cane fruit), sweet potato, and hops scheduled in the coming months. 
USDA looks forward to working with these groups as we expand the NCPN.
    APHIS has also made significant progress in addressing issues 
raised in the farm bill regarding the Agency's regulation of the 
products of biotechnology. In October of last year, APHIS proposed a 
major overhaul of its biotechnology regulations, which incorporate many 
of the provisions of the farm bill, such as implementing risk-based 
permit categories, requiring improved record-keeping, and clarifying 
actions the Agency may take in the event of an unauthorized release of 
a genetically engineered (GE) organism. We received more than 66,000 
comments and held five public meetings during the comment period. We 
are now considering the public input as we decide on the best way to 
move forward. Our goal is to ensure that now, and in the future, our 
regulations will always be strong enough to meet the demands of this 
science.
    APHIS is also nearing completion of the pilot phase of the new 
Biotechnology Quality Management System, which encourages developers to 
adopt auditable best-management practices for movements and outdoor 
releases of regulated GE organisms. In addition, we are taking steps to 
improve, where needed, separation distances between regulated field 
trials and neighboring fields. To do this, APHIS has undertaken a major 
review of the scientific literature and standard seed production 
practices, working in part with the Association of Official Seed 
Certifying Agencies. These enhancements are just a few examples of the 
many changes APHIS has implemented to its biotechnology regulatory 
program to ensure that it remains robust enough to address the evolving 
nature of biotechnology.
    Finally, Sec. 10205 established the Pest and Disease Revolving Loan 
Fund which would provide loans to local governments to finance 
purchases of equipment to monitor, remove, dispose of and replace pest 
and disease infested trees in quarantine areas. Although no funding has 
been appropriated, the Forest Service is currently in the process of 
drafting rules and identifying appropriate mechanisms to implement the 
Fund.
Subtitle C--Organic Agriculture
    The three provisions in this subtitle are administered by AMS. The 
National Organic Certification Cost-Share Program makes funds available 
to states, plus the District of Columbia and the Commonwealth of Puerto 
Rico, interested in providing cost-share assistance to organic 
producers and handlers certified under the National Organic Program 
(NOP). Sec. 10301 provided $22 million in CCC funds for cost share 
activities to remain available until expended and increased the cost 
share reimbursement from $500 to $750. Also, USDA was directed to 
submit by each March 1 an annual report to Congress describing: 
requests by, disbursements to, and expenditures for each state during 
the current and previous fiscal years, including the number of 
producers and handlers served. The Managers language encouraged the 
Secretary to keep accurate and current records of requests by and 
disbursements to states under the program, and require accurate and 
consistent record-keeping from each state and entity that receives 
program payments.
    For Fiscal Year 2008, $2.10 million was allocated to the states 
while in Fiscal Year 2009 $1.35 million was allocated to the states. On 
September 30, 2009, USDA announced the availability of funds for the 
cost share program for Fiscal Year 2010. The required report to 
Congress was delivered on March 20, 2009.
    Sec. 10302 directed USDA to collect data on production, pricing, 
and marketing of organic agricultural products. The data would be 
included and published in the ongoing baseline of date collection 
regarding agricultural production and marketing: $5 million in CCC 
funds were provided until expended and $5 million for each FY 2008 
through 2012 was authorized. The Managers Statement directed $3.5 
million of the $5 million to AMS. This section also required a report 
to Congress within 180 days of enactment on the progress made 
implementing these activities and identifying additional production and 
marketing data needs. The required report was delivered to Congress on 
December 29, 2008.
    AMS is proceeding with the expansion of the reporting of organic 
production and market data. For example, the September 5, 2008 issue of 
National Fruit and Vegetable Retail Report featured the debut of a new 
section devoted specifically to the coverage of organically grown 
produce sold on special at the retail level. In addition, AMS Market 
News has just issued its first organic market report on dairy products 
and continues to add a wide range of horticultural items to its daily 
reports for shipping point for domestic or point of entry for imported 
organic products. AMS has also added a ``Portal community'' specific to 
organic interests to the Market News Portal.
    Sec. 10303 authorized funding for the National Organic Program at 
$5 million for Fiscal Year 2008, $6.5 million for 2009, $8 million for 
2010, $9.5 million for 2011, and $11 million for 2012. For Fiscal Year 
2009, Congress appropriated $3.867 for the NOP and $6.967 million for 
Fiscal Year 2010.
Subtitle D--Miscellaneous
    The two honey provisions in this subtitle are administered by AMS. 
Sec. 10401 made a number of amendments to the Honey Research, 
Promotion, and Consumer Information Act. First, the farm bill directed 
AMS to consider a national research and promotion program for honey 
packers and importers. AMS received a proposal for this packers and 
importers program and conducted a referendum on that proposal from 
April 2-16, 2008. In the referendum, 78 percent of those voting, 
representing 92 percent of the volume of those voting in the 
referendum, approved the program. The program become effective on May 
22, 2008, 1 day after the final rule was published in the Federal 
Register. The first board meeting took place on September 4, 2008. With 
the approval of this new program, the collection of assessments under 
the Honey Research, Promotion and Consumer Information Order--
authorized under the Honey Research, Promotion and Consumer Information 
Act--was suspended. A termination order for that program was published 
in the Federal Register on April 17, 2009.
    The second major requirement under Sec. 10401 directed USDA to 
consider establishing a research and promotion program for domestic 
producers. On July 14, 2009, AMS published a proposed rule and 
solicited comments through September 14, 2009 for a domestic honey 
producer program. AMS is currently reviewing those comments. If it is 
determined that a program is warranted, AMS will publish a rule and 
hold a referendum. A final rule will be published if the program is 
approved in the referendum.
    The second farm bill honey provision, Sec. 10402, provided country 
of origin labeling requirements for honey that bears any official 
certificate of quality, grade mark or statement, continuous inspection 
mark or statement, sampling mark or statement or any combination of the 
certificates, marks, or statements of USDA. The Interim Final Rule was 
published in the July 8, 2009 Federal Register with comments due by 
September 8. This rule, which became effective October 6, 2009, would 
establish a new regulation addressing country of origin labeling for 
packed honey bearing any official USDA mark or statement and would add 
a new cause for debarment from inspection and certification service for 
honey.
    Finally, Sec. 10404 directed the Secretary to make payments to 
producers of the 2007 asparagus crop for market losses resulting from 
imports during the 2004 through 2007 crop years. USDA was authorized to 
expend up to $15 million in direct payments to asparagus producers: up 
to $7.5 million for payments for production marketed as fresh and up to 
$7.5 million for production marketed as processed. USDA is drafting a 
regulation to implement this provision.
Other USDA Activities Related to Specialty Crops and Organic 
        Agriculture
    On September 15, 2009, USDA announced its ``Know Your Farmer, Know 
Your Food'' (KYF2) Initiative. The impetus for this 
initiative, as the Committee well knows, was the many provisions in the 
2008 Farm Bill that focused on local and regional foods. Under the 
KYF2 initiative, agencies are challenged to examine current 
programs, policies, and regulations and be as innovative as possible to 
use these resources to encourage more local and regional food systems--
to the benefit of producers and consumers. A primary focus of this 
initiative is to help rural America create wealth and retain that 
wealth in their local communities.
    USDA is also committed to working with our partners to identify 
strategies to link children with foods that are produced in the same 
community where they attend school. This strategy benefits children, 
who receive a diverse, healthy diet, as well as farmers and local 
economies. USDA directly purchased about $650 million in specialty 
crops in 2008 for domestic nutrition assistance programs, including 
those that serve elderly and American Indian populations. This included 
an estimated $124 million in purchases by the National School Lunch 
Program and about $215 million for 2008 Farm Bill required purchases, 
plus emergency bonus purchases under Section 32. In part to support 
small farmer participation in these purchases, USDA, through its Office 
of Small and Disadvantaged Business Utilization (OSDBU), provides 
technical assistance and guidance on how to supply commodities to the 
domestic feeding programs. OSDBU conducts regular vendor outreach 
sessions to identify marketing strategies and information on how small 
farmers can market their capabilities to USDA. These sessions and the 
OSDBU outreach enable small farmers to establish relationships with 
USDA procurement officials, leading to increased procurement 
opportunities.
    We also support local farm to school efforts by providing technical 
assistance resources to our cooperating agencies. In 2000, USDA issued 
a step-by-step guide on the Small Farms/School Meals Initiative which 
details how to bring small farms and local schools together. In 2005, 
USDA issued Eat Smart--Farm Fresh! A Guide to Buying and Serving 
Locally-Grown Produce in School Meals, which provides best practices 
and strategies for finding locally-grown food and implementing Farm to 
School initiatives. We will be updating this publication later this 
year, with new success stories, additional resources from outside 
organizations, and basic tools for operating a successful program from 
start to finish.
    The organic industry is the fastest growing segment of U.S. 
agriculture. U.S. sales of organic foods have grown from $1 billion in 
1990, when the Organic Foods Production Act established the NOP, to a 
projected $23.6 billion in 2009. The National Organic Program is 
committed to the integrity of the organic seal. In September, Secretary 
Vilsack announced that the NOP will become an independent program area 
within AMS because of the increased visibility and emphasis on organic 
agriculture throughout the farming community, evolving consumer 
preferences, and the enhanced need for governmental oversight of this 
widely expanded program.
Conclusion
    Thank you for the opportunity to describe our successes and 
challenges in implementing Title X of the farm bill, as well as some of 
the related initiatives being undertaken by USDA. I am happy to answer 
any questions that you may have.

    The Chairman. Thank you very much. I would like to remind 
the Committee Members that you will be recognized in order of 
appearance and attendance at the meeting today.
    I will kick off the questioning with this one. In May, the 
National Organic Standards Board approved a process using 
sulfur to adjust soil pH. As you recall, I have raised the 
concern of timely rulemaking on this matter with Deputy 
Secretary Merrigan and with you when we met in July. In both 
conversations I asked that rulemaking be promptly completed so 
this use would be available to growers, including growers in my 
district, in time for the next season's crop growing and 
planting.
    Can you tell me where the NOP is in the rulemaking process 
with regards to this particular material?
    Ms. Pegg. Unfortunately, all of our focus has been on the 
access to pasture rulemaking right now, but we have added 
additional resources specifically to work on the NOSB 
recommendation and this product and to expedite the rulemaking 
process for this. I am hoping that we will have it out for 
public comment in the first part of next year.
    The Chairman. Okay. This is a relatively noncontroversial 
and straightforward rulemaking. Adjusting soil pH is 
particularly important in western states that have alkaline 
soils. And I know the burgeoning California blueberry industry, 
in particular, will benefit from this. I think it is very 
important that with the NOP's new leadership and the record 
funding that we provided, that we get this done. So I will look 
forward to hearing about that in the near future.
    Ms. Pegg. We will keep you posted. And it is important we 
get tools out to growers as quickly as possible.
    The Chairman. They would appreciate it, I am sure.
    Can you tell me why USDA targeted--well, the President's 
budget singled out section 10201, the pest protection fund and 
the clean plant network for cuts, even though Congress supplied 
mandatory funding in this area. It was an area of discussion 
that was in the farm bill, and was felt to be very important 
with the Members of this Committee that we put this money in. 
Can you tell me why USDA targeted these cuts?
    Ms. Smith, are you going to answer that?
    Ms. Smith. Yes. We wholeheartedly support the efforts to 
address threats and ensure the specialty crop industry has a 
reliable source of healthy planting stock. However, at the same 
time, the nation's economy is in a very serious situation, and 
the need to restrain Federal deficits is a high priority for 
this Administration.
    One of the challenges we face, of course, is balancing 
multiple priorities. I think our perspective is that funding 
for pest detection and surveillance that is made available 
through our discretionary appropriated funds would be the 
appropriate vehicle to address emerging issues.
    The Chairman. Well, I would vehemently disagree with that. 
I would tell you that, again, the Committee felt very strongly. 
These are sections that Mr. Costa and I fought for very 
strongly, and others, because of the outbreaks. What we found 
in California, in particular, is that oftentimes an ounce of 
prevention is worth several pounds of cure. And the cost of 
eradication is much more expensive than the preventive 
measures.
    I would really hope this Administration doesn't repeat the 
mistakes of the Bush Administration in not fully funding these 
areas and not doing enough. We had a number of hearings in this 
Committee in the past on the question of surveillance. In fact, 
in the prior Administration, there was a gentleman who was 
transferred from his job for doing the right thing and being a 
whistleblower. Those are not the kind of things that we would 
expect from this Administration. I will just say that.
    We don't expect to see them and we are not anticipating 
seeing them. But, at the same time, this is an area that I am 
very concerned about, and I know the Committee is going to be 
asking more questions about in the future.
    Can you describe how USDA works with other agencies to 
prevent the introduction of invasive species? Go ahead and 
answer that, then I will ask the follow-up.
    Ms. Smith. One of the fundamental things we do is work with 
the U.S. Customs and Border Protection Agency. There was a 
decision made after 9/11 to create DHS and to make sure that 
all of our protections at the borders were consolidated into 
the same organization.
    So one of the fundamental things that we do is to cooperate 
with CBP and work very closely with them. We provide them with 
the kind of information they need to understand what activities 
they need to be conducting at the border to reduce the 
likelihood of pests and pathogens coming into the country. 
There are a number of things we have done in recent years to 
really strengthen that relationship.
    The Chairman. Administrator Smith, the pest and disease 
provisions of the farm bill contain language directing APHIS to 
designate those states considered at high risk for pests or 
pest disease incursion, and to include the specific criteria 
they were to take into consideration when designating these 
areas. Designated high-risk states were then to be given a 
higher priority in terms of project funding.
    How is APHIS designating these high-risk states?
    Ms. Smith. I don't have the particulars about how we are 
designating them, but we have entered into a very collaborative 
process with a variety of stakeholders to form a group that has 
looked at all of the projects that are funded.
    The Chairman. Terrific. If these states have been 
designated, how is the increased risk being factored into the 
overall funding considerations?
    Ms. Smith. I will have to get the specifics to you of how 
we are doing that, sir.
    The Chairman. Okay.
    [The information referred to is located on p. 23.]
    The Chairman. Mrs. Schmidt.
    Mrs. Schmidt. Yes, thank you. I have a lengthy statement 
with a question at the end.
    Ms. Pegg, one of the key programs in the farm bill to 
receive mandatory funding and be accessible to the entire 
specialty crop industry is the Specialty Crop Block Grant 
Program. However, it appears that the Department is 
administering this program and setting priorities that were not 
the intent of the Congress.
    Deputy Secretary Merrigan's press release announcing block 
grant recipients stated that the USDA selected projects that 
emphasized local agriculture and small producers.
    The law does not direct the USDA to select projects. 
Instead, it directs the USDA to approve state plans. The 
Department's role is to provide accountability and make sure 
the plans submitted by the states are appropriate for meeting 
the goal of the program. The Department's role is not to select 
individual state projects that meet the administrative agenda. 
If Congress wanted to give the Department the authority to 
select individual projects, we would have written the program 
so that the USDA could administer a competitive grant program.
    The way Congress wrote the law, it gives the states the 
flexibility to choose what projects meet the needs of their 
respective specialty crop industry, and the USDA approves the 
plan.
    Your submitted written testimony states, ``Nearly all the 
funds were awarded to benefit small- and medium-size specialty 
crop farmers.'' This is why I have such a lengthy question, 
because that kind of ignited me.
    The statement concerns me, because if you read the law the 
farm bill does not place a priority on funding projects for 
small- and medium-size producers. The intent of Congress was 
that this program should assist producers of all sizes, 
regardless of the way they market their products. It appears 
that the Department is placing priorities within the program 
that cannot be found in the statute.
    I would ask the Department to provide the Subcommittee, the 
full Subcommittee, a representative sample of correspondence 
between the Department and the states in regards to 
implementing this program since it was amended by the farm 
bill. I would also request a list of all projects submitted by 
each state, including those the USDA did not select.
    The hearing has an opening of 10 days for all 
correspondence, and so I would hope that you could handle that.
    Ms. Pegg. Yes.
    Mrs. Schmidt. Thank you. You can answer.
    Ms. Pegg. Okay. I think you raise a very important question 
that has been asked of USDA and our new initiative Know Your 
Farmer, Know Your Food. Are we jeopardizing the integrity of 
the programs in existing statutes?
    No we aren't. Congress set the foundation and gave us the 
roadmap with the farm bill or block grants, the Farmers Market 
Promotion Program and a number of other programs whose 
authority supports the Know Your Farmer, Know Your Food 
Initiative
    We looked at all grants. We didn't pick and choose grants. 
Our only concerns with grants relates to lobbying activities or 
an absence of support for specialty crop products or the 
industry. There was a recurring theme from every state proposal 
and that was the creation of direct marketing opportunities for 
farmers of all sizes. In Ohio, it was wine promotion for wine 
producers in Ohio. We saw a consistent theme of direct 
marketing, and we see that theme as supportive of the Know Your 
Farmer, Know Your Food Initiative.
    The Specialty Crop Block Grants also focused on research; 
new varieties to combat pests and diseases; new varieties to 
meet market demands; as well as food safety, which is clearly 
an issue for farmers of all sizes.
    We are happy to provide you the information you requested, 
we want to continue these discussions. We know a lack of 
clarity about Know Your Farmer, Know Your Food, supporting 
farmers of all sizes and types, is one of the concerns that we 
have received.
    Mrs. Schmidt. Thank you. Maybe if you would choose your 
words more carefully in press releases, it wouldn't make us so 
concerned as to what the Department is doing.
    I do have a couple of more questions, if I may, sir. I want 
to go to Cindy Smith, probably, on this one.
    The Pest and Disease Program that was designed to help 
different states and regions of the country deal with their own 
unique pest and disease pressures, this Committee included the 
provision in the farm bill to allow APHIS to work with various 
stakeholders to ensure that we have a better system to manage 
for pests and diseases in the nursery industry.
    What progress has APHIS made in developing that system?
    Ms. Smith. We have done a number of things. As you are 
aware, this is a very important priority for us, as well as you 
and many of our stakeholders. We developed a 5 year strategy 
for expending the funds and moving the program forward. As the 
basis for that 5 year strategy we focused in six areas: 
analysis and survey; inspection at vulnerable points; pest 
identification tools; safeguarding, specifically, nursery 
production; outreach and education; and enhancing mitigation 
capabilities.
    We have funded 63 projects in 21 states and other areas, 
expending the full $12 million for this past fiscal year. This 
includes nearly $1.4 million to develop science-based 
management practices and risk mitigation practices to exclude, 
contain, and control regulated pests from the nursery 
production chain and develop and harmonize audit-based nursery 
certification programs.
    Mrs. Schmidt. Okay. May I continue? Thank you.
    Is the proposed increase in the agricultural quarantine 
inspection user fees limited to cover only the AQI costs? And 
can you provide the Committee with the breakdown of the real 
costs in actual collections?
    Ms. Smith. This is the increase in the AQI user fee interim 
proposal that is out right now?
    Mrs. Schmidt. Yes.
    Ms. Smith. We would be happy to provide you the information 
that gives you the breakdown of the costs for that program.
    Mrs. Schmidt. Thank you.
    [The information referred to is located on p. 23.]
    Mrs. Schmidt. Although the USDA informed the court that an 
environmental impact statement for Roundup Ready alfalfa, 
ordered in 2007, would take between 18 and 24 months, it has 
been now over 30 months. Has the EIS been completed? If not, 
what approvals are necessary for it to be published for public 
comment in the Federal Register, and what are the proposed 
timing of those approvals and printing processes?
    Ms. Smith. We certainly recognize the importance of 
completing this environmental impact statement. We also 
recognize the importance of making sure that we do it in the 
highest quality manner to ensure that it will address the 
requirements of the court.
    We contracted--for the first time, contracted out an EIS to 
try to help support our swift but thorough completion of that 
document. We have a document that is near a draft EIS. It is 
near completion. It will need to go through our clearance 
process and will be published.
    After that is published, of course, there will be a comment 
period. And then we will need to finalize that EIS as well. And 
there will be a final record of decision that will follow.
    Mrs. Schmidt. This is my last follow-up.
    I understand that. The issue is that we have needs out in 
the country, and the EIS is already past due. So is it another 
month, another 2 months, another 30 months?
    Ms. Smith. We are hopeful we can publish the draft EIS 
before the end of this year.
    Mrs. Schmidt. Thank you.
    The Chairman. I thank the gentlelady. We will offer another 
round of questions to the Committee as well.
    I would now like to call Mr. Schrader from Oregon.
    Mr. Schrader. Thank you, Mr. Chairman. I have a question 
regarding the policing of the organic labeling statutes that 
are out there. What is going on? How are we assuring consumers 
that the crop--the food they are eating is organic, not natural 
or almost natural or wanting to be natural?
    Ms. Pegg. Congress provided more funding, which has been a 
significant improvement to the program, because now we are able 
to hire more staff and focus on enforcement and compliance, and 
we will be making a number of improvements to the program.
    Mr. Schrader. So that change is underway, but no results 
yet?
    Ms. Pegg. Correct.
    Mr. Schrader. With the pest control strategy, I am 
interested in knowing how we are going to track success. How 
are we defining success? We have this six-point plan. How are 
we going to define success? What pests, what diseases are we 
targeting, in particular, across the country, and how are we 
going to define whether or not we are doing a better job? What 
are your benchmarks?
    Either one of you. I assume Ms. Smith.
    The Chairman. Mr. Schrader, would you repeat the question?
    Mr. Schrader. I was just curious. You have the six point 
plan for pest and disease and disaster management that you 
talked about. I was curious what particular diseases and pests 
that the plan is targeting. How do you define success? What 
benchmarks do you actually have to tell you that you are doing 
what you want to be doing?
    Ms. Smith. Under each of those six areas, we have a very 
comprehensive set of performance measures. I will provide you 
with a copy of that. Targeting a very comprehensive array of 
pests requires a variety of different approaches.
    [The information referred to is located on p. 24.]
    Mr. Schrader. I assume we have provided enough money for 
you to be successful, as least as far as you can tell from your 
strategy, in each of these different areas.
    Ms. Smith. That is correct. With the information that we 
have available, we could also provide you the information that 
shows you how that money has been distributed in each of those 
performance areas.
    Mr. Schrader. I would appreciate that.
    [The information referred to is located on p. 24.]
    Mr. Schrader. One last question, with the advent of 
biofuels, there is some controversy about compatibility of 
various crops, particularly with other specialty crops. In my 
home State of Oregon, there is some interest in using canola as 
a rotation crop, but it doesn't necessarily have great 
compatibility due to its pest profile and some of our specialty 
crops, for instance.
    Is there any research at the USDA to help identify these 
options for lessening incompatibilities and setbacks? Any 
research on rotations that might ensure our specialty crop 
industry is not harmed by our biofuels industry?
    Ms. Pegg. I will look into it your question.
    Research within USDA is handled by the Agricultural 
Research Service and the National Institute of Food and 
Agriculture. I will consult with my colleagues and get back 
with you.
    [The information referred to is located on p. 25.]
    Mr. Schrader. That would be helpful because it is highly 
controversial, and unfortunately it is pitting farmer against 
farmer, which you don't want to do, and there is probably some 
research out there that could be done that would help us. Thank 
you very much. I yield back.
    The Chairman. I thank the gentleman from Oregon. The 
gentleman from California, Mr. Costa, is recognized for 5 
minutes.
    Mr. Costa. Thank you very much, Chairman Cardoza. 
Administrator Pegg, I looked up this morning and I thought I 
was back in Sacramento. Welcome to Washington. Those of you who 
are part of the audience, Congressman Cardoza and the new 
Administrator and I all worked together in a previous life.
    I want to talk first about the implementation of the Act 
that Chairman Cardoza, referenced earlier in his opening 
comments. Obviously, I think we share, because of our 
constituencies and our commodities that we grow in the state, 
similar experiences. As a result of the Chairman's hard work on 
the last farm bill, specialty crops, not just in California but 
around the country, have great benefits. Administrator Smith, I 
want to thank you for your work on Citrus psyllid. As you know, 
it is an enormous issue for California.
    On that topic, it is my understanding that APHIS has 
committed rapid implementation as part of the citrus health 
program. As you may know now, California has become the largest 
citrus state in the nation. With the challenges that Florida 
has had with psyllid, we are quite anxious to ensure that 
California does not experience those same problems.
    Could you give us a sense of the timing of this expanding 
program?
    Ms. Smith. I have to get specifics on that back to you.
    Mr. Costa. We would like that, and we would like the 
specifics as it relates also to citrus psyllid. It is, 
obviously, a concern to the citrus industry.
    Let me move on. And please provide that information to the 
Subcommittee and to each of our offices.
    [The information referred to is located on p. 26.]
    Mr. Costa. Prevention of the importation of invasive pests 
program has been a priority for all of us in specialty crops, 
certainly, Congressman Cardoza and myself. You noted, in your 
comments, that it takes a great deal of time and resources to 
deal with early detection. We have had a good collaboration 
historically between California and some of the other states--
Hawaii, others, and with the USDA on inspection to prevent and 
stop the spread of these pests. We know APHIS has devoted a 
number of resources to that effort.
    Congressman Cardoza and I were visited yesterday by the 
California Secretary of Agriculture, A.G. Kawamura. He 
indicated to us they are now dealing with five outbreaks of 
fruit flies. We know that the agencies work in conjunction with 
each other.
    This issue gives insight to what we deal with in terms of 
invasive species due to the ports. And we have border 
inspection issues that we constantly deal with south of us.
    Here's my question: Does the Department, DHS or CBP, do 
they provide cross-resources for inspection purposes on 
jurisdiction, and do you coordinate efforts on these efforts?
    Ms. Smith. I appreciate Secretary Kawamura's interest in 
this issue. He has been a very important stakeholder as we 
ensure that not only are we at APHIS satisfied with the work 
done through agriculture quarantine inspection, but, more 
importantly, that states such as California are satisfied.
    The way that process works is that the agricultural 
quarantine inspection fees are collected and provided to APHIS. 
Then we work with DHS to divide those fees up so that we 
provide some to DHS for their border work and we maintain some.
    Mr. Costa. But is there coordination of those resources? 
For example, do all the funds have to come out of USDA? We were 
talking yesterday afternoon about the potential as to whether 
or not Homeland Security, as an example, could be a resource, 
since there are common shared purposes on the borders, so that 
not all the funding is either at the USDA level or the state 
level.
    Ms. Smith. DHS actually provides additional funding in 
addition to the user fee fundings that we allocate.
    Mr. Costa. I would like more information on this. We, under 
certain conditions, have airline service, direct service 
between Guadalajara and Fresno. We raised the bar, and I 
insisted on pest inspection of those planes that arrive daily. 
Those are two flights. But, here is my point; the City of 
Fresno, that is local government resources, provide the 
additional resources for the inspection purposes, wherein other 
airports like Los Angeles LAX, Homeland Security, and others 
are providing those resources. It seems unfair that we are 
having to provide the additional resources for inspection 
purposes.
    Ms. Smith. One thing we did recently related to that is 
that we are piloting a California State Agricultural Liaison at 
CBP. This is an example of the kind of things we are trying to 
do with CBP to address some of your needs. We are very open to 
hearing additional recommendations.
    Mr. Costa. I would like to follow through with that, maybe 
establish some sort of a task force where we can work together.
    Mr. Chairman, I have two more questions, if possible.
    The Chairman. Sure.
    Mr. Costa. We obviously appreciate your support for 
Specialty Crop Block Grants. It has been invaluable to our 
efforts to support healthy diets for school lunch programs, 
adding more fruits and vegetables, tree nuts, et cetera, to the 
lunches.
    Could you give me a sense of where the majority of these 
grants have been going once they reach the state? Are they 
being distributed to farm groups, to associations? Are a large 
portion of those funds staying at the state level, or do they 
get down to the schools? How is it being used by, the 
California Department of Food and Agriculture?
    Ms. Pegg. I will need to provide you more details on how 
the grants look across the nation. I know for California there 
was some focus on food safety and food safety research. They 
worked with the Center for Produce Safety on that portion. They 
also worked with a number of organizations on farm to school 
gardens.
    I will provide to you an analysis of what we saw in terms 
of trends.
    Mr. Costa. I would like to get a snapshot, and I think 
other Members of the Subcommittee would as well. We put these 
grants together for the purpose of promoting healthy diets and 
to work with our schools in doing so. It would be of interest 
to all of us to see how these grants are being provided and 
distributed.
    Ms. Pegg. We can get you that information.
    [The information referred to is located on p. 26.]
    Mr. Costa. Thank you very much, Administrator Pegg, for 
your time. Welcome to Washington. We hope your experience is as 
interesting as it has been for all of us.
    The Chairman. I am not sure if that is ``well wishes'' or a 
curse, Mr. Costa.
    Thank you for your questions, sir.
    I am going to pass right now and turn it over to Mrs. 
Schmidt so that we can have some bipartisan discussions. Mrs. 
Schmidt, I will recognize you for 5 minutes.
    Mrs. Schmidt. Thank you. Two quick follow-ups to the Know 
Your Farmer, Know Your Food theme. Ms. Pegg or Ms. Smith, based 
on the USDA press releases, the Know Your Farmer, Know Your 
Food theme has been incorporated into several specialty crop 
programs such as the DOD Fresh Program, the Farmers Market 
Promotion Program, and the Specialty Crop Block Grant Program.
    When the USDA approves funding and awards grants, is the 
Department evaluating these projects that fit into this new 
agenda, or just how are they evaluating them?
    Ms. Pegg. We are evaluating it based on the statute and the 
regulation. For the Specialty Crop Block Grants, those were all 
state proposals. We evaluated them on the statute and whether 
there was a prohibited activity.
    For the Farmers Market Promotion program an independent 
committee looked at all 470 proposals, and reviewed those and 
then gave recommendations to the Department.
    For DOD Fresh, we look to our authorities to allow states 
to purchase locally.
    So each aspect of Know Your Farmer, Know Your Food is 
really administered according to the statute.
    Mrs. Schmidt. My concern is the authority and the way Know 
Your Farmer, Know Your Food is being used to promote the block 
grant programs. I hope that the information received back 
clarifies it for me. I think that Know Your Farmer, Know Your 
Food is a great idea, but I am very concerned about the 
implementation of that idea into a law that doesn't really give 
you the authority to do so. Thank you.
    The Chairman. Thank you. I appreciate it.
    This question is for Administrator Pegg and it regards the 
Specialty Crop Block Grant Program. In creating the State Block 
Grant Program, Congress decided to distribute Specialty Crop 
Block Grants by state agricultural officials. Do you think the 
states are doing a good job in doing their secondary outreach, 
and what are some effective examples of this outreach?
    It appears that while certain projects and programs are 
directly related to state-specific needs, there are a number of 
issues--food safety, traceability and nutrition, pest and 
disease--that are not congruent with state boundaries. How are 
you managing to get that feedback back? Do you think more 
states should consider multi-state partnerships in the 
utilization of their block grant funding, and what has been 
your experience, thus far, with multi-state grants? Would there 
be a case for a national block grant program?
    Ms. Pegg. We are actually holding a call right now with all 
the states' departments to go over the expectations for 2010, 
the funding, when funds will be available, and filling out 
their grant applications. They are required to reach out and 
provide us with how they are reaching out to different groups 
and different entities within their states.
    Looking at how the grants were distributed in the issue 
areas that a lot of the states proposed in the 2009 funding, I 
think states should look at 2010 and determine where they can 
partner together.
    Food safety is a big issue for a lot of growers, large and 
small, throughout the nation. And we saw a lot of states 
addressing this issue.
    It would be very good if the states were to partner 
together and see how they can leverage that research and 
leverage those dollars.
    The Chairman. In the past year, there was somewhat of, it 
seemed, a compressed timeline for application requests; 
requests for proposals under the block grant program. That is 
probably to be expected, considering the late passage of the 
farm bill last year and some of those issues around it and the 
change of Administrations.
    Can we anticipate that that request for proposal will be 
earlier and that there will be more time for states to comply 
and to make their proposals?
    Ms. Pegg. This was one of the issues that we faced with the 
block grants. States had to submit proposals very quickly. We 
will be announcing the availability of 2010 funds next month, 
with grants due in June of 2010. There will be plenty of time 
for states to respond.
    They will also have time to reach out within the states, 
make sure they are reaching their communities, and develop 
grants.
    The Chairman. Very good. This Committee has been very 
concerned in the past with honeybees, their declining 
populations, the and mysterious diseases that have affected 
them. The 2008 Farm Bill also established a framework for 
holding referenda on two proposed new honey research and 
promotion boards to replace the previous honey board. One of 
these new boards was designed to primarily represent the 
interests of packers and importers and other interests in U.S. 
products.
    Congress hoped, in fairness to all segments of the 
industry, that the process for both of these new boards would 
move forward on the same expedited basis and on roughly the 
same timetable. As it turned out, the referenda on the packer 
and importer board took place early in 2008, and the new board 
has been up and running for more than a year. In contrast, 
after more than 2\1/2\ years of receipt of the formal documents 
calling for the creation of the producer board, there has been 
no referenda yet held on the producer board.
    Obviously, this isn't all the fault of an Administration 
that has only been in office for a few months. But, 
Administrator Pegg, after this period of time calling for the 
creation of a new honey producer board and the fact that there 
has been no referenda yet held on the board, given the history, 
I would be interested in hearing your explanation why you 
believe it has taken so long. At the same time, I'd strongly 
urge you to move forward as quickly as you can on the new honey 
producer board referenda.
    Ms. Pegg. We are currently reviewing all the comments 
regarding establishing a research and promotion board for 
domestic producers and moving forward with that process. I will 
note your request that we move quickly on that and work toward 
doing that.
    The Chairman. I appreciate that very much. Do any Members 
of the Committee have any further questions? Would the 
witnesses like to make any final statements?
    Ms. Pegg. We thank you for the opportunity to update you. 
We look forward to working with all of you, and we look forward 
to receiving your questions, and working together to move the 
specialty crop sector forward. Thank you.
    The Chairman. Thank you. I appreciate your being here with 
us today. I look forward to further dialogue and more broad-
based hearings on Title X of the farm bill in section 10. I 
would like to remind the Members that they do have 10 days with 
which to expand their comments.
    Under the rules of the Committee, the record of today's 
hearing will remain open for 10 calendar days to receive 
additional material from our witnesses and supplementary 
responses from the Members.
    This hearing of the Subcommittee on Horticulture and 
Organic Agriculture is hereby adjourned. Thank you.
    [Whereupon, at 10:55 a.m., the Subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]
                Supplemetary Material Submitted by USDA
    During the October 28, 2009 hearing entitled, Hearing To Review 
Implementation of the Horticulture and Organic Agriculture Title of the 
Food, Conservation, and Energy Act of 2008, requests for information 
were made to USDA. The following are their information submissions for 
the record.
Insert 1
          The Chairman. Terrific. If these states have been designated, 
        how is the increased risk being factored into the overall 
        funding considerations?
          Ms. Smith. I will have to get the specifics to you of how we 
        are doing that, sir.

    As required by the farm bill, APHIS provided and will continue to 
provide Section 10201 funding to states that are considered high risk 
for one or more plant pests or diseases, taking into consideration the 
items outlined in the farm bill such as the number of international 
ports in a state. APHIS developed a comparative risk assessment (CRA) 
to determine which states are considered high risk; however, it is 
important to note that the considerations outlined in the farm bill do 
not account for the full pest risk picture. Because of this, APHIS also 
evaluated a wider list of considerations such as the volume of goods 
moved beyond a port-of-entry and pest and product pathways.
    As we look at future Section 10201 funding distribution, APHIS is 
discussing with states the possibility of further analysis on the 
multiple risk factors related to plant pests and diseases, such as 
state risk and pest pathways. Risk is constantly changing and our goal 
is to work closely with the states to further our understanding of this 
risk.
Insert 2
          Mrs. Schmidt. . . . Is the proposed increase in the 
        agricultural quarantine inspection user fees limited to cover 
        only the AQI costs? And can you provide the Committee with the 
        breakdown of the real costs in actual collections?
          Ms. Smith. This is the increase in the AQI user fee interim 
        proposal that is out right now?
          Mrs. Schmidt. Yes.
          Ms. Smith. We would be happy to provide you the information 
        that gives you the breakdown of the costs for that program.

    Yes, the AQI user fee increase that APHIS proposed on September 28, 
2009, and subsequently withdrew on October 30, 2009, was to fund only 
agricultural quarantine and inspection (AQI) activities. Section 
2509(a) of the Food, Agriculture, Conservation, and Trade Act of 1990 
(21 U.S.C. 136a) authorizes APHIS to collect user fees for AQI 
activities. We maintain all AQI fees we collect in distinct accounts, 
carefully monitor the balances in these accounts, and only use these 
funds to pay for our actual costs for providing these distinct 
services. Any surplus in the AQI account carries forward from year to 
year and is available until expended to fund AQI activities.
    While APHIS withdrew the interim rule for the proposed AQI user fee 
increase on October 30, 2009, based on stakeholder feedback, the below 
reflects the spending plan if that increase had been finalized.
APHIS FY 2010 AQI User Fee Spending Plan
    APHIS' initial spending plan for FY 2010, which assumed that the 
emergency fee increase would go into effect on October 1, 2009, totaled 
$207.033 million. Descriptions of AQI program activities and funding 
levels under the initial plan are below.

    APHIS AQI Policy and Management: $12.899 million

    APHIS units develop policy and protocols for inspection processes 
at ports of entry; coordinate efforts with Customs and Border 
Protection (CBP); analyze import and pest interception data from ports 
of entry; and maintain and update inspection and treatment manuals.

    APHIS Port Operations and Oversight: $115.107 million

    This category includes APHIS' plant inspection stations, the 
Veterinary Regulatory Support staff, staff involved in import 
facilitation (such as fumigation of cargo, treatment validation), and 
inspection operations in the Dominican Republic and Mexico as well as 
the Professional Development Center (where CBP agricultural specialists 
and canine teams are trained).

    Science and Technical Support: $14.617 million

    This category includes APHIS' National Identification Services 
staff that provides pest identification policy and technical guidance 
and national taxonomic services for the certain pests intercepted at 
ports of entry. APHIS also develops detection tools and diagnostic 
methods used at ports of entry and treatment protocols applied to 
imported agricultural products.

    Import Analysis and Risk Management: $36.648 million

    This category includes risk analysis efforts that support import 
trade negotiations, the development of appropriate risk management 
measures, and other analyses that support regulatory decision making 
processes for agricultural imports to ensure that safe agricultural 
trade can occur.

    Regulatory Enforcement and Anti-Smuggling Programs: $27.762 million

    The Smuggling Interdiction and Trade Compliance (SITC) program 
analyzes potential smuggling pathways, conducts product traces to 
distribution points in commerce and importers, and coordinates with 
investigative organizations to increase regulatory compliance. APHIS' 
Investigative and Enforcement Services (IES) unit investigates 
potential violations of APHIS' regulations.

    Total Collections

    With the increased user fee rule, APHIS expected AQI user fee 
collections to total $578 million. Of that amount, APHIS planned to 
transfer $346.9 million to CBP. APHIS' allocation of new funding would 
have been $206.5 million. The remaining $24 million would have been 
used to rebuild the AQI reserve, which was used to keep the program 
functioning during FY 2009, when collections were $61 million less than 
anticipated.
Insert 3
          Mr. Schrader. I was just curious. You have the six point plan 
        for pest and disease and disaster management that you talked 
        about. I was curious what particular diseases and pests that 
        the plan is targeting. How do you define success? What 
        benchmarks do you actually have to tell you that you are doing 
        what you want to be doing?
          Ms. Smith. Under each of those six areas, we have a very 
        comprehensive set of performance measures. I will provide you 
        with a copy of that. Targeting a very comprehensive array of 
        pests requires a variety of different approaches.

    The Section 10201 Implementation Plan describes how success will be 
measured, for each of the strategic goals. The Plan is available on our 
website at: http://www.aphis.usda.gov/plant_health/plant_pest_info/
pest_detection/farm_bill.shtml.
    While the 10201 Implementation Plan describes how success will be 
measured for each of the six strategies (Enhance Analysis and Survey, 
Target Domestic Inspection Activities, Enhance Pest Identification and 
Technology, Safeguard Nursery Production, Conduct Education and 
Outreach, Enhance Mitigation Efforts), the overarching goal is to 
protect the health and value of U.S. agriculture and natural resources. 
This will be measured by the value of damages prevented through early 
detection efforts. Anytime we enter into a cooperative agreement with a 
state or other stakeholder, including agreements for Section 10201 
funding, the agreement outlines performance measures that cooperators 
must meet, as well as requirements for reporting their activities to 
APHIS.
Insert 4
          Mr. Schrader. I assume we have provided enough money for you 
        to be successful, as least as far as you can tell from your 
        strategy, in each of these different areas.
          Ms. Smith. That is correct. With the information that we have 
        available, we could also provide you the information that shows 
        you how that money has been distributed in each of those 
        performance areas.

Section 10201 Financial Obligations for FY 2009

    (1) Enhanced analysis and surveys ($3,387,573):
 High risk pathway analysis                                      $370,460
Plum Pox survey                                                 $582,658
Plant Health Information System (PHIS)--survey component        $635,075
Enhance state surveys for high risk pests                     $1,640,611
Honeybee pest survey                                            $158,769
    (2) Target domestic inspection activities ($1,058,458):
 Expand canine teams into new locations in California          $1,058,458
    (3) Pest identification & technology enhancement ($2,072,747):
 PHIS--trap/lure procurement system                              $241,329
Bulk procure traps and lures                                  $1,129,878
Diagnostic support for high threat arthropods                    $79,384
Develop and deliver molecular diagnostics                       $595,578
Cryopreservation for fruit fly production facility               $26,579
    (4) Safeguarding nursery production ($1,363,334):
 Establish a National Ornamentals Research Site at             $1,053,234
 Dominican University in California (NORSDUC)
Support state oversight of the research site                     $52,923
Model regulation for a state nursery certification               $69,858
 program
National nursery virus certification program pilot               $91,690
Audit-based state nursery certification systems--                $25,770
 training
Audit-based state nursery certification systems--                $69,858
 outreach
    (5) Outreach and education ($1,142,641):
 Forest pest outreach                                          $1,014,964
Laurel Wilt outreach                                             $31,754
Crop Biosecurity Curriculum/extension                            $95,923
    (6) Enhance mitigation capabilities ($2,975,246):
 Asian Citrus Psyllid mitigation in northern Mexico              $899,459
Plum Pox Virus mitigation in NY and MI                          $745,799
Fruit fly mitigation in CA                                      $659,420
Mitigation of golden nematode in targeted areas of NY           $256,999
Laurel Wilt research focused on mitigation to protect           $169,353
 avocados
Discovery of biological control agents to control Asian          $52,923
 Citrus Psyllid
Cactus Moth mitigation in Louisiana                             $191,293
Insert 5
          Mr. Schrader. One last question, with the advent of biofuels, 
        there is some controversy about compatibility of various crops, 
        particularly with other specialty crops. In my home State of 
        Oregon, there is some interest in using canola as a rotation 
        crop, but it doesn't necessarily have great compatibility due 
        to its pest profile and some of our specialty crops, for 
        instance.
          Is there any research at the USDA to help identify these 
        options for lessening incompatibilities and setbacks? Any 
        research on rotations that might ensure our specialty crop 
        industry is not harmed by our biofuels industry?
          Ms. Pegg. I will look into it your question.

    This is fundamentally an issue of genetic contamination. The 
growers of vegetable seeds such as brassicas cannot tolerate cross 
contamination from canola oil seed crops (whether edible oil or oil for 
biofuels). There are regulations established for distances seed crops 
must be isolated from other similar kind of seed crops as well as from 
other kind usage crops (like canola). Brassica vegetable seed crops are 
grown in the Willamette Valley, Oregon (high value crops but limited 
acreages) and there has been historic conflict between these growers 
and other farmers who wish to grow canola oil seed crops. State 
regulatory agencies such as the Oregon Department of Agriculture may 
restrict canola for oil to be grown in the Willamette Valley to protect 
the vegetable seed industry.
    Apart from genetic contamination of specialty crop seed production, 
bioenergy crops can be beneficial to specialty crop production. USDA's 
Agricultural Research Service's (ARS) research in Orono, ME has shown 
that potato crops (a specialty crop) grown in rotation with canola oil 
seed crops increased potato yields and reduced the risk of economic 
loss compared to potato grown in continuous rotation or potato rotated 
with barley. ARS research in Prosser, WA has shown that the oil seed 
residues left after oil extraction when applied to potato fields 
reduced disease and weed incidence so the amounts of pesticides that 
needed to be applied could be reduced. Also, as shown in Maine, canola 
rotated with potato was beneficial to potato production.
Insert 6
          Mr. Costa. . . . With the challenges that Florida has had 
        with psyllid, we are quite anxious to ensure that California 
        does not experience those same problems.
          Could you give us a sense of the timing of this expanding 
        program?
          Ms. Smith. I have to get specifics on that back to you.
          Mr. Costa. We would like that, and we would like the 
        specifics as it relates also to citrus psyllid. It is, 
        obviously, a concern to the citrus industry.

    We are working as quickly as possible to implement activities to 
protect California and other citrus-producing states from citrus pests 
and diseases, using the increased funding that APHIS received in FY 
2010 appropriations. APHIS received a total of $44.7 million for our 
Citrus Health Response Program (CHRP) in FY 2010. We are currently 
working with state cooperators and stakeholders and will be finalizing 
operational plans and the corresponding budgets for California, 
Arizona, Texas, Louisiana, and Florida over the next several weeks. 
While nationally coordinated, the operational plans are designed to 
address local needs in each region and are based on the overarching 
goals of the CHRP, which encompasses the following activities, with 
estimated FY 2010 funding distribution indicated:

   Asian citrus psyllid (ACP) and Huanglongbing (HLB-citrus 
        greening) survey activities ($20.00 million).

   ACP suppression ($7.0 million).

   Regulatory framework/enforcement ($11.5 million).

   Communication and outreach ($0.90 million).

   Management and program support/national and 
        international coordination with Mexico and other North and 
        Central American countries ($3.80 million).

   Method development/research ($1.5 million).
Insert 7
          Mr. Costa. I would like to get a snapshot, and I think other 
        Members of the Subcommittee would as well. We put these grants 
        together for the purpose of promoting healthy diets and to work 
        with our schools in doing so. It would be of interest to all of 
        us to see how these grants are being provided and distributed.
          Ms. Pegg. We can get you that information.

                             Specialty Crop Block Grant Program-Farm Bill (SCBGP-FB)
----------------------------------------------------------------------------------------------------------------
             Fiscal Year                            Grantees                          Projects Awarded
----------------------------------------------------------------------------------------------------------------
2008                                  50 states, the District, and five     262
                                       U.S. Territories
2009                                  50 states, the District, and four     745
                                       U.S. Territories (American Samoa
                                       chose not to apply)
----------------------------------------------------------------------------------------------------------------
              2008 Project Delivery Types                              2009 Project Delivery Types

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


------------------------------------------------------------------------------------------------------------------------------------------------
State Programs                     The proposal illustrated that the
                                    state department of agriculture
                                    planned to administer the project
                                    and/or a competitive grant program
                                    was not conducted.
Competitive Grants                 The proposal demonstrated that a fair
                                    and open competition was conducted
                                    and the project partner(s) are
                                    clearly involved.
Other                              The proposal illustrated that project
                                    partners met with the grantee to
                                    determine project priorities, but an
                                    open competitive grant program was
                                    not conducted.
------------------------------------------------------------------------

 
------------------------------------------------------------------------
From 2008 to 2009 the SCBGP-FB
 percentage
  of . . .                                      In 2009, 79% of the funds  ------------------------------------------------------------------------


                  SCBGP-FB 2008 and 2009 Project Types 
------------------------------------------------------------------------
        2008 Project Types                                        2009
 Project Types
------------------------------------------------------------------------

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

------------------------------------------------------------------------
From 2008 to 2009 the SCBGP-FB
 percentage
  of . . .  ------------------------------------------------------------------------


                                                        SCBGP-FB 2008 and 2009 Project Sub-Types
--------------------------------------------------------------------------------------------------------------------------------------------------------
                            Project Sub-Type                                 2008        2008%         2009        2009%        Total        2008-2009
--------------------------------------------------------------------------------------------------------------------------------------------------------
Beginning and Socially Disadvantaged Farmers                                       7        2.67%           55        7.38%           62           4.71%
Child and Adult Nutrition                                                          5        1.91%           16        2.15%           21           0.24%
Cooperative Development                                                            2        0.76%           27        3.62%           29           2.86%
E-Commerce                                                                         0        0.00%           17        2.28%           17           2.28%
Ethnic Crop Marketing and Production                                               2        0.76%           10        1.34%           12           0.58%
Export Market Development                                                          2        0.76%           23        3.09%           25           2.32%
Farm to School                                                                     8        3.05%           36        4.83%           44           1.78%
Farmers' Markets                                                                   7        2.67%           13        1.74%           20          ^0.93%
GAP/GHP                                                                            1        0.38%            6        0.81%            7           0.42%
Genetic Improvement                                                                1        0.38%            6        0.81%            7           0.42%
Growing Season Extension                                                           8        3.05%           28        3.76%           36           0.70%
Human Health                                                                       3        1.15%           39        5.23%           42           4.09%
Improved Quality                                                                  14        5.34%           42        5.64%           56           0.29%
Increased Yield                                                                    0        0.00%            8        1.07%            8           1.07%
New and Improved Specialty Crop Varieties/Uses                                     0        0.00%            4        0.54%            4           0.54%
Water Studies/Conservation                                                         3        1.15%           26        3.49%           29           2.34%
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                                              Project Sub-Type Descriptions 
--------------------------------------------------------------------------------------------------------------------------------------------------------
Beginning and Socially Disadvantaged Farmers 
                                                                             Child and Adult Nutrition  
Cooperative Development                                                                             E-Commerce Ethnic Crop Marketing and Production                                                                             Export Market Development GAP/GHP 
                                                                             Farm to School  
Farmers' Markets
                                                                             Genetic Improvement   
Growing Season Extension                                                                             Human Health Improved Quality 
                                                                             Increased Yield New and Improved Specialty Crop Varieties/Uses 
                                                                             Water Studies/Conservation --------------------------------------------------------------------------------------------------------------------------------------------------------

  
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