[Senate Hearing 112-452]
[From the U.S. Government Publishing Office]
S. Hrg. 112-452
AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND
RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2012
=======================================================================
HEARINGS
before a
SUBCOMMITTEE OF THE
COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE
ONE HUNDRED TWELFTH CONGRESS
FIRST SESSION
on
H.R. 2112
AN ACT MAKING APPROPRIATIONS FOR AGRICULTURE, RURAL DEVELOPMENT, FOOD
AND DRUG ADMINISTRATION, AND RELATED AGENCIES PROGRAMS FOR THE FISCAL
YEAR ENDING SEPTEMBER 30, 2012, AND FOR OTHER PURPOSES
__________
Department of Agriculture
Department of Health and Human Services: Food and Drug Administration
Nondepartmental Witnesses
__________
Printed for the use of the Committee on Appropriations
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Available via the World Wide Web: http://www.gpo.gov/fdsys/browse/
committee.action?chamber=senate&committee=appropriations
__________
U.S. GOVERNMENT PRINTING OFFICE
64-588 PDF WASHINGTON : 2012
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC
area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, Washington, DC
20402-0001
COMMITTEE ON APPROPRIATIONS
DANIEL K. INOUYE, Hawaii, Chairman
PATRICK J. LEAHY, Vermont THAD COCHRAN, Mississippi
TOM HARKIN, Iowa MITCH McCONNELL, Kentucky
BARBARA A. MIKULSKI, Maryland RICHARD C. SHELBY, Alabama
HERB KOHL, Wisconsin KAY BAILEY HUTCHISON, Texas
PATTY MURRAY, Washington LAMAR ALEXANDER, Tennessee
DIANNE FEINSTEIN, California SUSAN COLLINS, Maine
RICHARD J. DURBIN, Illinois LISA MURKOWSKI, Alaska
TIM JOHNSON, South Dakota LINDSEY GRAHAM, South Carolina
MARY L. LANDRIEU, Louisiana MARK KIRK, Illinois
JACK REED, Rhode Island DANIEL COATS, Indiana
FRANK R. LAUTENBERG, New Jersey ROY BLUNT, Missouri
BEN NELSON, Nebraska JERRY MORAN, Kansas
MARK PRYOR, Arkansas JOHN HOEVEN, North Dakota
JON TESTER, Montana RON JOHNSON, Wisconsin
SHERROD BROWN, Ohio
Charles J. Houy, Staff Director
Bruce Evans, Minority Staff Director
------
Subcommittee on Agriculture, Rural Development, Food and Drug
Administration, and Related Agencies
HERB KOHL, Wisconsin, Chairman
TOM HARKIN, Iowa ROY BLUNT, Missouri
DIANNE FEINSTEIN, California THAD COCHRAN, Mississippi
TIM JOHNSON, South Dakota MITCH McCONNELL, Kentucky
BEN NELSON, Nebraska SUSAN COLLINS, Maine
MARK PRYOR, Arkansas JERRY MORAN, Kansas
SHERROD BROWN, Ohio JOHN HOEVEN, North Dakota
DANIEL K. INOUYE, Hawaii (ex
officio)
Professional Staff
Galen Fountain
Jessica Arden Frederick
Dianne Nellor
Stacy McBride (Minority)
Rachel Jones (Minority)
Administrative Support
Molly Barackman-Eder
C O N T E N T S
----------
Thursday, March 10, 2011
Page
Department of Agriculture: Office of the Secretary............... 1
Material Submitted Subsequent to the Hearing..................... 63
Thursday, March 17, 2011
Department of Health and Human Services: Food and Drug
Administration................................................. 69
Nondepartmental Witnesses........................................ 113
AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND
RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2012
----------
THURSDAY, MARCH 10, 2011
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 2:05 p.m., in room SD-124, Dirksen
Senate Office Building, Hon. Herb Kohl (chairman) presiding.
Present: Senators Kohl, Nelson, Pryor, Brown, Blunt,
Cochran, Collins, Moran, and Hoeven.
DEPARTMENT OF AGRICULTURE
Office of the Secretary
STATEMENT OF HON. TOM VILSACK, SECRETARY
ACCOMPANIED BY:
KATHLEEN MERRIGAN, DEPUTY SECRETARY
JOSEPH GLAUBER, CHIEF ECONOMIST
MICHAEL YOUNG, DIRECTOR, OFFICE OF BUDGET AND PROGRAM ANALYSIS
opening statement of senator herb kohl
Senator Kohl. The subcommittee will come to order.
This is our first hearing on the President's fiscal year
2012 budget.
First, I want to welcome our new ranking member, Senator
Roy Blunt.
I'd also like to recognize the new members of this
subcommittee, Senator Brown, Senator Moran, and Senator Hoeven.
We look forward to working with each and every one of the new
members of this subcommittee.
And, Mr. Secretary, it's very good to see you again.
I also want to welcome Deputy Secretary Merrigan and U.S.
Department of Agriculture (USDA) Chief Economist Joseph
Glauber. Also, we have with us today Mr. Mike Young, who is the
new USDA Budget Director.
Mr. Secretary, it's obvious that we are faced with
tremendous challenges. The Nation is still struggling through
economic recovery, while Government spending is being reduced
by a big margin.
Here at home, we feel the economic throes of unrest in
distant parts of the world as oil supply lines are being shaken
and our cost of energy rises hugely from 1 week to the next. On
top of all this, the Federal Government is still operating on a
continuing resolution for the current fiscal year. These are
the realities.
We all recognize that Government exists for a reason and
there are some things that Government must do because it is the
job of Government to do. Our food must be safe, our people must
not go hungry, our farm and rural economies must remain strong,
and we must never lose sight of the impact they have on our
national economy. On the other hand, we are going to have to
let go of some of the things that, while popular, are not
essential. These are indeed days of hard decisions.
The President's budget makes a good start in that
direction. Some programs are cut and some are eliminated. At
the same time, new initiatives are brought forward and the
President is requesting increases in some programs. Our job is
to review all of these priorities and make the hard decisions.
The American people rely on USDA every day. The American
people also rely on us to make sure their tax dollars are spent
wisely. As Government spending declines, the need for wisdom in
setting priorities has never been more acute. Mr. Secretary, we
will look forward to your guidance on that very important task.
As we continue, I'd like to take note that we have a vote
scheduled for 3 o'clock, and so, if we all are brief in our
comments, we'll have an opportunity to ask the Secretary the
relevant questions.
Mr. Secretary.
summary statement of secretary tom vilsack
Secretary Vilsack. Mr. Chairman, thank you very much. I
appreciate the opportunity to be with you this afternoon.
I will be very short. We have a written statement we'd ask
to be part of the record. I'd just simply make two points.
First, we recognize the responsibility to reduce our
budget. We started that process last year. We continue it with
the budget we propose to you this year, both in the
discretionary and on the mandatory side. The reality is that
there has to be shared sacrifice, as well as shared
opportunity.
The second point I would make is that, in addition to
cutting our way to a more balanced fiscal approach, we also
have to grow the economy. We have to be focused on jobs. That
is certainly true in rural America, where we have had,
historically, a much higher unemployment rate than in other
parts of the country. Interestingly enough, as a result of the
strong agricultural economy, we're seeing the unemployment rate
coming down in rural America at a faster rate than the rest of
the country. We'll obviously want to continue the momentum.
So, we do indeed focus on an effort to not only reduce our
spending, but also to focus it in a way that will advance,
strategically, a growth agenda, as well in rural America, and
continue the momentum.
prepared statement
I understand that you've got a vote. I understand that you
really need to have questions directed to us. With that, I will
simply conclude and look forward to your questions.
[The statement follows:]
Prepared Statement of Secretary Tom Vilsack
Mr. Chairman and distinguished members of this subcommittee, I
appreciate the opportunity to appear before you as Secretary of
Agriculture to discuss the administration's priorities for the U.S.
Department of Agriculture (USDA) and provide you an overview of the
President's fiscal year 2012 budget. I am joined today by Deputy
Secretary Kathleen Merrigan, Joseph Glauber, USDA's Chief Economist,
and Michael Young, USDA's budget officer.
In his State of the Union Address, the President laid out some of
the challenges America faces moving forward as we compete with nations
across the globe to win the future. We need to be a Nation that makes,
creates, and innovates so that we can expand the middle class and
ensure that we pass along to our children the types of freedoms,
opportunities, and experiences that we have enjoyed. We also need to
take some serious steps to reduce the deficit and reform Governmentt so
that it's leaner and smarter for the 21st century.
The fiscal year 2012 budget we are proposing reflects the difficult
choices we need to make to reduce the deficit while supporting targeted
investments that are critical to long-term economic growth and job
creation. To afford the strategic investments we need to grow the
economy in the long term while also tackling the deficit, this budget
makes difficult cuts to programs the President and I care about. It
also reflects savings from a number of efficiency improvements and
other actions to streamline and reduce our administrative costs. It
looks to properly manage deficit reduction while preserving the values
that matter to Americans.
In total, the budget we are proposing before this subcommittee is
$130 billion, a reduction of $3 billion less than the fiscal year 2011
annualized continuing resolution. For discretionary programs, our
budget proposes $18.8 billion, a reduction of $1.3 billion less than
the fiscal year 2011 level. These decreases are achieved through
reductions and terminations in a wide range of programs as well as
proposals to achieve savings through streamlining our operations. These
actions will allow us to focus limited resources on programs where we
can achieve the greatest impact.
Further, we are proposing legislative changes to target reductions
in farm program payments, which would save $2.5 billion over 10 years,
while only affecting 2 percent of participants. The savings would come
in addition to savings we have achieved through administrative
improvements that reduced the error rate in farm program payments from
2 percent to less than 0.1 percent as well as a partnership with the
Internal Revenue Service to eliminate improper payments to wealthy
individuals who exceed income eligibility criteria. In addition,
legislation will be proposed to reduce premiums for the catastrophic
coverage option under the crop insurance program providing a savings to
taxpayers of $1.8 billion over 10 years.
These and other reductions must be made if we are serious about
deficit reduction and being able to support the critical investments we
need to make to secure our future.
At USDA, we haven't waited to begin reducing our expenditures. Last
year, we saved $6 billion through the negotiation of a new agreement
for crop insurance, $4 billion of which will go to pay down the Federal
deficit. Agencies across the Department have looked for ways to reform
the way they do business--from reducing the number of visits a farmer
has to make to our offices to get conservation services, to saving
taxpayer dollars by operating our nutrition assistance programs with
historic levels of accuracy.
I would now like to focus on some specific highlights in each of
our major goals.
assisting rural communities to create prosperity
Agriculture has generally fared well during the recent economic
downturn, with farm income expected to be at almost record levels this
year largely due to the productivity and hard work of American farmers
and ranchers and growers. Further, agriculture continues to be one of
the major sectors of the American economy that has a trade surplus. Our
budget preserves a strong farm safety net, including a $4.7 billion
farm credit program, about $150 million more than the fiscal year 2011
level. As I mentioned earlier, we are also proposing to better target
farm payments by reducing the cap on direct payments and reducing over
a 3-year period the adjusted gross income eligibility limits. These
actions would save $2.5 billion over 10 years.
Rural America offers many opportunities, but it also faces a number
of challenges that have been experienced for decades. Rural Americans
earn less than their urban counterparts, and are more likely to live in
poverty. More rural Americans are older than the age of 65, they have
completed fewer years of school, and more than one-half of America's
rural counties are losing population. In addition, improvements in
health status also have not kept pace, and access to doctors and health
services has been a key challenge in rural areas.
Within the context of a reduced total funding level, our budget
proposes to focus resources on the most effective means to address the
long-term challenges facing rural communities and the Nation. A
critical element is engaging with public and private partners to
revitalize rural communities by expanding economic opportunities and
creating jobs for rural residents.
For Rural Development programs, our budget proposes a total program
level of roughly $36 billion supported by $2.4 billion in budget
authority, a reduction of about $1.6 billion in program level and $535
million in budget authority. It also reflects the administration's
efforts to utilize funding in the most cost-effective manner to achieve
our goals.
A number of difficult decisions were made, including a reduction of
$390 million in budget authority from the fiscal year 2011 level in
housing programs. The budget eliminates funding for a number of loan
and grant programs, including Self-Help Housing grants and low-income
housing repair loans. We are also reducing funding for direct single-
family housing loans and focusing on maintaining support for single-
family housing loan guarantees at a program level of $24 billion. This
level of assistance can be provided with no budget authority by
continuing a fee structure that fully supports the subsidy cost of the
program. We are also reducing the water and waste loan and grant
program by $62 million in budget authority. Associated with these
program reductions, we are reducing administrative funding and staffing
levels. These and other actions allow us to focus limited resources on
meeting priority investment needs in rural America.
Regional Innovation Initiative
One of these priority investments is in a new approach we have
developed to ensure USDA supports rural communities who choose to
engage in regional economic strategies. This approach recognizes that
attempting to address the challenges faced by rural communities through
a generic approach will not be sufficient. Instead, USDA needs to
respond to grassroots local priorities and recognize that each rural
region needs a distinctive strategy that reflects its unique strengths,
its particular mix of industry clusters, and which integrates its
regional economic assets.
In 2010, to support rural communities' efforts to collaborate
regionally, USDA used the Rural Business Opportunity Grant program to
provide funding to seven identified regions to support plans focused on
supporting job creation, local, or regional food systems, renewable
energy, capitalizing on new broadband deployment, and the utilization
of natural resources to promote economic development through regional
planning among Federal, State, local, and private entities. Funding has
been provided to multijurisdictional regions in California, Iowa, North
Dakota, Oregon, South Carolina, Vermont, and Washington to develop
regional plans to enhance economic opportunities. USDA is working
department-wide to determine how it can support the priorities of the
people in the region. USDA is also working with other Federal partners
to ensure that these rural regions have access to other Federal
programs that support their regional strategies. By creating a regional
focus and increasing collaboration with other Federal agencies,
resources can be leveraged to create greater wealth, improve quality of
life, and sustain and grow the regional economy.
For 2012, USDA proposes a Regional Innovation Initiative that works
through existing programs to fund regional pilot projects, strategic
planning activities, and other investments to improve rural economies
on a regional basis. USDA would target up to 5 percent of the funding
within 10 existing programs, approximately $171 million in loans and
grants, and allocate these funds competitively among regional pilot
projects tailored to local needs and opportunities. The approach will
support projects that are more viable over a broader region than
scattered projects that serve only a limited area. It will also help
build the identity of regions, which could make the region more
attractive for new business development, and provide greater incentives
for residents to remain within their home area.
The fiscal year 2012 budget specifically provides an increase of $5
million for the Rural Business Opportunity Grant program to foster
regional collaboration that encourages regions to engage in strategic
regional economic planning that identifies the needs of a defined rural
region. In addition, an increase of $2.1 million is included for the
Rural Community Development Initiative to provide technical assistance
to communities to develop housing or community facilities projects.
Facilitating the Development of Renewable Energy
A major administration priority is continuing to make investments
in building a green energy economy. Last year, the President laid out
his strategy to advance the development and commercialization of a
biofuels industry. At the center of this vision is an effort to
increase domestic production and use of renewable energy. Advancing
biomass and biofuel production that holds the potential to create green
jobs is one of the many ways the Obama administration is working to
rebuild and revitalize rural America. By producing renewable energy--
especially biofuels--America's farmers, ranchers, and rural communities
have incredible potential to help ensure our Nation's energy security,
environmental security, and economic security. Through investments in
energy efficiency and renewable energy sources, farms and rural small
businesses across the country can reduce their energy consumption and
energy expenses. In 2009 and 2010, USDA has helped nearly 4,000 rural
small businesses, farmers, and ranchers save energy and improve their
bottom line by installing renewable energy systems and energy
efficiency solutions that have produced or saved a projected 4.3
billion in kWh--enough energy to power 390,000 American homes for a
year.
In 2012, USDA plans to invest more than $900 million in
discretionary and mandatory funding to improve the entire supply chain
of biofuels and bioenergy, from research and development, to production
and commercialization. In addition, the budget includes $6.1 billion
for electric loans, which will be used to support renewable energy and
the development of clean-burning low-emission fossil fuel facilities to
support renewable energy deployment and clean energy technology.
Promising Market Opportunities
Developing and supporting market opportunities and outlets for
agricultural producers helps to promote jobs and prosperity in rural
America. Over the past year, we have supported efforts to build and
strengthen regional and local food systems through the ``Know Your
Farmer, Know Your Food'' efforts. Our goal is to build a link between
local production and local consumption, which is particularly
beneficial to small- and mid-sized farmers.
In fiscal year 2012, USDA will continue to support efforts to
expand promising market opportunities with $9.9 million in funding for
the National Organic Program, which will be used to strengthen
oversight and enforcement and $7.7 million for transportation and
market development activities that will stimulate development of
regional food hubs and marketing outlets for locally and regionally
grown food.
Furthermore, USDA, working together with the Departments of Health
and Human Services and the Treasury will implement the Healthy Food
Financing Initiative (HFFI) to provide incentives for food
entrepreneurs to expand the availability of healthy foods by bringing
grocery stores, small retailers, and farmers markets selling healthy
foods to underserved communities. HFFI will make available more than
$400 million in financial and technical assistance to community
development financial institutions, other nonprofits, public agencies,
and businesses with sound strategies for addressing the healthy food
needs of communities. For USDA, the budget requests $35 million to
support local and regional efforts to increase access to healthy food,
particularly for the development of grocery stores and other healthy
food retailers in urban and rural food deserts and other underserved
areas. In addition, USDA will make other funds available by encouraging
and rewarding relevant grant and loan applications through existing
Rural Development and Agricultural Marketing Service programs.
Broadband
In his State of the Union Address, President Obama established a
goal to deploy the next generation of high-speed wireless coverage to
98 percent of all Americans. In the last one-and-a-half years, with
funding from the American Recovery and Reinvestment Act (ARRA) we have
done more to bridge the digital divide for rural Americans than many
ever thought possible. ARRA funding will enable around 7 million rural
Americans to connect to 1 of 285 last-mile, 12 middle-mile, or four
satellite projects funded by USDA. On top of that, more than 360,000
businesses and 30,000 community service organizations such as
hospitals, schools, and public safety agencies will be connected to a
high-speed digital future. USDA will continue to build on the success
of funding provided through ARRA by making loans and grants under the
authorities provided by the farm bill. Our budget continues to provide
support for these important efforts with $17.9 million for grants to
support local broadband access in rural communities and funding for
loans with balances available from prior-year appropriations.
Trade Expansion
Expanding access to global markets makes a critical contribution to
our efforts to enhance rural prosperity by providing opportunities for
increased sales and higher incomes. During the past year, we have
worked diligently to remove trade barriers and open new markets.
Through our efforts, we were able to regain access for our poultry
exports to Russia, after Russia introduced a ban on the use of chlorine
washes in the processing of poultry. Similarly, we worked to expand
market access for pork in Russia and China by addressing residue and
disease issues, and we continue to engage China on reopening that
market for our beef exports. Also noteworthy, we entered into a
memorandum of understanding with China that addresses quality and
sanitary and phytosanitary policy issues that will help to facilitate
our soybean exports. This is a very significant step as China is now
our largest overseas market for soybeans, and the significant growth we
have experienced in that market--in soybeans and many other products--
has helped China to emerge as our largest agricultural export market.
Our trade promotion activities support the National Export
Initiative (NEI), a Governmentwide effort to double U.S. exports over
the next 5 years in order to spur economic growth and employment
opportunities. Every $1 billion worth of agricultural exports supports
an estimated 8,000 jobs, so we know that when we succeed in expanding
markets we are creating real benefits for our workforce. To bolster
these efforts, the budget proposes an increase of $20 million for the
Foreign Agricultural Service to support an expansion in trade
monitoring and enforcement activities, exporter assistance and
education efforts, support for State-organized trade missions, and in-
country market access and promotion activities.
Ensuring Private Working Lands Are Conserved, Restored, and
Made More Resilient to Climate Change, While
Enhancing Our Water Resources
USDA continues to be a major partner in advancing the
administration's conservation and environmental agenda through support
of the conservation partnership and the strategic targeting of funding
to high-priority regional ecosystems. The budget request will ensure
that the conservation partnership remains strong among Federal
agencies, State and local governments, tribes, industry, and farmers.
This broad partnership has proven to be a resilient and effective
mechanism for meeting the administration's water policy goals and
helping protect the Nation's 1.3 billion acres of farm, ranch, and
private forestlands.
The budget requests nearly $900 million in discretionary funding
for conservation activities, primarily technical assistance that
provides comprehensive conservation planning for the Nation's farmers,
ranchers, and private forest landowners. This reflects a reduction of
$168 million and related staff-years for the elimination of the
watershed operations and rehabilitation programs, conservation
operations earmarks, and the Resource Conservation and Development
program.
The fiscal year 2012 budget advances resource protection by
strategically targeting funding to high-priority regional ecosystems
and initiatives. This includes $15 million to implement the Strategic
Watershed Action Teams Initiative, which will enhance targeted
technical assistance in priority watersheds for a period of 3-5 years
with the goal of reaching 100 percent of the landowner base in each
watershed eligible for farm bill conservation program assistance. The
goal of this initiative is to hasten environmental improvement while
keeping production agriculture competitive and profitable.
To improve the delivery of conservation technical assistance, which
is a field staff-based activity, the budget includes $11.3 million to
fund the Conservation Delivery Streamlining Initiative. This initiative
will develop new business processes designed to simplify the planning
process and maximize the amount of time USDA technicians spend in the
field helping farmers. These funds will improve how we deliver
conservation planning and financial assistance and help farmers with
practice installation.
Finally, the budget includes an increase of $7 million for the
Conservation Effects Assessment Project, to enhance the scientific
understanding of the environmental effects of conservation practices on
agricultural landscapes. This knowledge will help us improve the design
and implementation of conservation programs.
The fiscal year 2012 budget also includes $5.8 billion in mandatory
funding to support cumulative enrollment of more than 302 million acres
in farm bill conservation programs, an increase of nearly 8 percent
more than fiscal year 2011, for conservation programs authorized in the
2008 farm bill, such as the Wetlands Reserve Program, Environmental
Quality Incentives Program, and the Conservation Reserve Program.
promote agricultural production and biotechnology exports as america
works to increase food security
USDA works to improve global food security through a wide variety
of activities, such as providing food and technical assistance that
supports the development of sustainable agricultural systems in
developing countries, by facilitating the adoption of biotechnology and
other emergent technologies that increase agricultural production and
food availability, and by working to advance internationally accepted,
science-based regulations that facilitate trade. These efforts are
important because more than 1 billion people worldwide face hunger and
malnutrition every day, and we know that failing agricultural systems
and food shortages fuel political instability and undermine our
national security interests.
USDA is an active partner in the administration's global food
security initiative--Feed the Future--and we have been working closely
with the State Department, the U.S. Agency for International
Development (USAID), and others to further its objectives. As an
implementing partner, USDA can offer expertise in basic and applied
research that benefits both the United States and developing countries;
in-country capacity building and technical assistance; and market
information and economic analysis. For example, during the past year,
USDA has worked with USAID to develop the Norman Borlaug Commemorative
Research Initiative, a mechanism designed to increase cooperation and
collaboration between our two agencies in managing research strategies
and their implementation. Through this mechanism, we will collaborate
on targeted, high-impact research priorities, such as wheat rust,
legume productivity, livestock diseases, mycotoxins, and human
nutrition, which can have far-reaching benefits to farmers worldwide.
An important means to assist developing countries to enhance their
agricultural capacity is by providing training and collaborative
research opportunities in the United States, where participants can
improve their knowledge and skills. The budget provides increased
funding for the Cochran and Borlaug Fellowship programs, which bring
foreign agricultural researchers, policy officials, and other
specialists to the United States for training in a wide variety of
fields. Under our proposal, as many as 600 individuals will be able to
participate in these programs and bring this knowledge home to benefit
their respective countries.
Foreign food assistance programs remain a core component of our
efforts to enhance global food security. The fiscal year 2012 budget
includes more than $2 billion of funding for both emergency and
nonemergency international food assistance programs carried out by USDA
and USAID. Although funding for the McGovern-Dole International Food
for Education and Child Nutrition Program is reduced by $9 million, the
program will assist as many as 5 million women and children during
2012.
As the world population grows and the demand for food with it, we
must look to new technologies for increasing production, including
biotechnology. Biotechnology can expand the options available to
agricultural producers seeking solutions to a variety of challenges,
including climate change. However, prudent steps must be taken to
ensure that biotech products are safely introduced and controlled in
commerce. For 2012, the budget includes increased funding to strengthen
USDA's science-based regulatory system and ensure that we can provide
timely, sufficient review of the expanding volume and complexity of
biotechnology applications. During the past fiscal year, USDA continued
to see an increase in workload due to this expanding industry. Notably,
USDA received 44 percent more requests for field testing of genetically
engineered plants than were received in fiscal year 2009.
ensuring that all of america's children have access to safe,
nutritious, and balanced meals
Nutrition Assistance
The budget fully funds the expected requirements for the
Department's three major nutrition assistance programs--the Special
Supplemental Nutrition Program for Women, Infants, and Children (WIC),
the National School Lunch Program, and the Supplemental Nutrition
Assistance Program (SNAP).
National School Lunch Program participation is estimated to reach a
record-level again in 2012, 32.5 million children each school day, up
from about 31.6 million a day in 2010. The budget proposes an increase
of $9 million to ensure USDA makes progress to decrease the prevalence
of obesity among children and adolescents, and to improve the quality
of diets. The increase will allow USDA to continue implementing the
scientific, evidence-based nutrition guidance and promotion of the 2010
update of the Dietary Guidelines for Americans.
The budget includes $7.4 billion for WIC, which will support the
estimated average monthly participation of 9.6 million in 2012, an
increase from an estimated 9.3 million participants in 2011. The
request is $138 million more than the 2011 annualized continuing
resolution. This includes an increase for the breastfeeding peer
counseling program and a doubling of the breastfeeding program
performance bonus funding. WIC State nutrition services and
administrative activities are funded at a level sufficient to ensure
effective program operations along with increased emphasis on
information technology (IT) and electronic benefits transfer (EBT).
Participation in SNAP is estimated to average about 45 million
participants per month in 2011, and is projected to fall slightly in
2012. The budget includes more than $85 billion, including ARRA
funding, to fund all expected costs. Legislation will be proposed to
extend the ARRA provision that waives time limits for able-bodied
adults without dependents for an additional fiscal year. In total, this
change would add about $92 million to recipient benefits and SNAP
program costs in 2012. In addition, the fiscal year 2012 budget
proposes to maintain the increase for SNAP benefits authorized by ARRA
for 5 months, increasing outlays in 2014 by $3.3 billion.
Food Safety
The budget includes $1 billion for the Food Safety and Inspection
Service, a reduction of about $7 million less than 2011. The requested
level is adequate to fully fund inspection activities and including an
increase of $27 million to improve our capability of identifying and
addressing food safety hazards and preventing foodborne illness. These
increases are more than offset by reductions due to streamlining agency
operations, reducing lab expenses, and recognizing that implementation
of a catfish inspection program will not occur in 2012.
Minimizing the Impact of Major Animal and Plant Diseases and Pests
To protect agricultural health by minimizing major diseases and
pests of food crops and livestock, the budget includes $837 million, a
reduction of $76 million, in appropriated funds for the Animal and
Plant Health Inspection Service (APHIS). We have taken a close look at
the APHIS budget and have proposed a number of program reductions and
redirections to ensure that scarce resources are being used prudently.
The budget achieves savings through a variety of means. It includes
decreases for activities where eradication campaigns have been
successful, such as cotton pests, pseudorabies, and screwworm, and for
pests and diseases where eradication is not likely, such as tropical
bont tick. Savings are also possible in the avian health program
without affecting overall performance. Further, the budget achieves
other savings by acknowledging the role of the producer to engage in
best management practices to reduce certain diseases, such as Johne's
disease. These savings allow us to propose increases for selected
pests, including the light brown apple moth and the European grapevine
moth.
research
Scientific research is essential for our prosperity, health,
environment, and our quality of life. By investing in the building
blocks of American innovation, we will help ensure that our economy is
given all the necessary tools for new breakthroughs, new discoveries
and the development of new industries. While progress will not come
immediately, our investments today will be a catalyst which leads to
answers to problems of national importance, including developing
alternative energy sources, improving the nutrition and health of
America's children, and developing solutions to the most urgent
environmental problems.
The fiscal year 2012 budget requests approximately $1.2 billion in
discretionary funding for the National Institute of Food and
Agriculture (NIFA), a decrease of $141 million from 2011. The budget
eliminates $141 million in congressional earmarks as well as makes
selective reductions in ongoing programs, including a reduction of 5
percent in formula funding for 1862 Land Grant Institutions and the
elimination of the animal health and disease formula program. The
budget continues to move toward the use of competitive grants to
generate the solutions to the Nation's most critical problems. A major
element in NIFA's research budget is an increase of $62 million for the
Agriculture and Food Research Initiative (AFRI)--the premier
competitive, peer-reviewed research program for fundamental and applied
sciences in agriculture. This increase, which brings the total AFRI
funding to $325 million, will focus on sustainable bioenergy, global
food security, food safety, human nutrition and obesity prevention, and
global climate change, while still supporting foundational research.
The fiscal year 2012 budget for the Agricultural Research Service
is approximately $1.14 billion, a net decrease of $42 million. This
reduction is achieved through the elimination of congressional earmarks
and other lower-priority projects that total about $101 million. These
reductions help fund program increases totaling approximately $59
million for high-priority research. Major initiatives include improved
genetic resources and cultivars leading to better germplasm and
varieties with higher yields, enhanced disease and pest resistance, and
resilience to weather extremes such as high temperature and drought.
The budget will also fund several initiatives to support research on
breeding and germplasm improvement in livestock which will enhance food
security and lead to the development of preventive measures to combat
diseases and thereby increase production. These initiatives have great
potential to help ensure an abundant, safe, and inexpensive supply of
food to meet global demand. Additionally, the budget funds research
initiatives that will accelerate the development and deployment of
dedicated energy feedstocks, thereby reducing dependence on foreign oil
and expanding the opportunities for American farmers. Finally, the
budget supports projects that focus on food safety, human nutrition,
and obesity prevention.
The fiscal year 2012 budget request for the National Agricultural
Statistics Service includes an increase of nearly $12 million in
initiatives, which is offset by $8.3 million in terminations of low-
priority programs. This includes the elimination of a land tenure
survey largely comprised of farm operators that are accounted for in
the Agricultural Resource Management Survey. The fiscal year 2012
budget includes full funding to support the third year of the 2012
Census of Agriculture's 5-year cycle and to improve the data quality of
the County Estimates program which is used within the Department to
administer crop insurance programs, as well as crop revenue support
programs, emergency assistance payments, and the Conservation Reserve
Program.
Finally, $8.4 million is included for initiatives within the
Economic Research Service, including an initiative for behavioral
economics that will yield information and analysis that enhances
decisionmaking on economic and policy issues related to agriculture,
food, farming, natural resources, and rural development. These
increases are partially offset by a $4.9 million reduction from lower-
priority projects.
management initiatives
To reform USDA so it is leaner, more efficient and ready for the
21st century, we will support efforts to better streamline operations
and deliver results--at lower cost--for the American people. The budget
reflects the Department's commitment to increasing program delivery
effectiveness by implementing management improvements, administrative
efficiencies, and IT systems that modernize the USDA workplace.
A significant streamlining and efficiency measure being proposed is
a structured buyout of 504 Federal headquarters and related employees--
10 percent--of the Farm Service Agency (FSA). This restructuring effort
is expected to result in net savings of $27 million in 2012 and total
savings of $174 million through 2015. In addition, we are proposing a
further savings of $14.4 million in FSA administrative expenses through
efficiencies related to advisory contracts, travel expenses, printing
and supplies. It is also critical that we continue to invest in
modernizing the FSA IT system to provide a secure, modern system
capable of supporting Web-based program delivery.
One of the key components for increasing USDA effectiveness is
focused on creating a high-performing and diverse workforce across the
Department. Through USDA's Cultural Transformation Initiative, the
Department and its workforce are being revamped to increase job
satisfaction, training opportunities, and career development
possibilities. USDA will focus on improving leadership development,
labor relations, human resources accountability, and veterans and other
special employment programs. These efforts will greatly improve the
productivity of the Department, resulting in better service to USDA
constituents and more value for American taxpayers. A $3 million
increase is proposed to strengthen our human resources transformation
initiatives and veterans hiring efforts.
USDA also strives to improve the efficiency with which it purchases
more than $5 billion in goods and services annually. These acquisitions
support USDA program delivery, including food purchases for the
nutrition programs and IT purchases in support of business operations.
Regardless of what is being purchased, USDA relies upon a workforce of
acquisition professionals to efficiently and effectively procure the
goods and services needed to ensure continued service delivery by the
Department. As part of a Governmentwide initiative pursuant to the
President's Memorandum on Government Contracting, USDA is requesting
funding of $6.5 million for training, workforce development activities,
and supporting IT systems. Such efforts will greatly improve the
workforce's ability to negotiate more favorably priced contracts and
manage contract costs more effectively. These improvements will support
USDA's actions to implement its acquisition savings plan that includes
a projected 7-percent reduction in noncommodity acquisitions in fiscal
year 2011, with additional reductions in the out-years.
We are also taking additional steps to address the unfortunate
history of civil rights in USDA. As you know, since coming into office,
this administration has made great strides in resolving claims of
discrimination by reducing the backlog of complaints and by working to
settle lawsuits brought against the Department by Black and Native
American farmers and ranchers. USDA has worked closely with the
Congress to secure the funding necessary to address the Pigford II
class action lawsuit. The Department has also been working to resolve
other discrimination claims such as those being brought by women and
Hispanic farmers and ranchers. In fiscal year 2012, we are requesting
funding under the FSA to pay the administrative costs of resolving
existing civil rights claims, and to provide settlement for
discrimination claims filed under the Equal Credit Opportunity Act
where the statute of limitation has expired. The Department remains
committed to taking these actions as part of our commitment to create a
New Era of Civil Rights in USDA.
Ensuring that the Department and its programs are open and
transparent is also a key component of the transformation effort. As a
result, USDA is proposing to expand the Office of Advocacy and Outreach
(OAO), which was established by the 2008 farm bill, to improve service
delivery to historically underserved groups and will work to improve
the productivity and viability of small, beginning, and socially
disadvantaged producers. The outreach efforts led by OAO will help to
ensure that all persons eligible to participate in USDA programs will
have the opportunity and the information necessary to benefit from the
services delivered by the Department.
The President told us that winning the future will require a lot of
hard work and sacrifice from everyone. The President's budget reflects
sacrifice, but provides the funding to achieve his vision for a strong
America. I look forward to working with this subcommittee to help build
a foundation for American competitiveness for years to come so that we
pass on a stronger America to our children and grandchildren.
I would be pleased to take your questions at this time.
Senator Kohl. All right. We'll begin our questioning. Thank
you so much, Mr. Secretary.
FOOD SAFETY AND INSPECTION SERVICE FUNDING LEVEL
As you are aware, we're still in negotiations regarding the
fiscal year 2011 bills. H.R. 1 proposes an $88 million cut to
the Food Safety and Inspection Service (FSIS). I've been told
this proposed cut would seriously limit FSIS's ability to
maintain its inspection force. At what point, Mr. Secretary,
would budget cuts at fiscal year 2011 result in a furlough of
FSIS inspectors? If that is so, do you have a contingency plan?
Secretary Vilsack. Mr. Chairman, we are obviously hopeful
that this matter gets resolved without significant reductions
in the FSIS budget. As you probably well know, that budget is
predominantly personnel. Any significant cut and reduction in
that budget would obviously lead to a very difficult set of
decisions we would have to make, relative to our workforce.
Most of what our workforce does in that area is to provide
inspection services to a number of processing facilities. We
would be concerned, obviously, about the impact it would have
on those processing facilities and on the markets that are
impacted and affected by the work that they do.
We have proposed, in the fiscal year 2012 budget, a
reallocation within FSIS. I would simply say that the key here
is to give the Department sufficient time to manage difficult
choices that you all have to make. If you attempt to squeeze,
in a relatively short period of time--i.e., a set of months--a
solution to a budget problem that has accumulated perhaps over
decades, I think you're going to have difficulty, and I think
you're going to make it very difficult for us to manage it
properly without someone being hurt. This is one area, in
particular, that we have concerns about.
Senator Kohl. All right.
GAO REPORT ON DUPLICATIVE GOVERNMENT PROGRAMS
Mr. Secretary, the Government Accountability Office (GAO)
recently released a report on duplicative Government programs,
which I'm sure that you are aware. Duplication in food safety
efforts across Federal agencies was a major theme in the
report. Can you please respond to the findings of the report
regarding overlap in food safety activities? Do you believe the
current food safety system is adequately serving the American
public? And, how do you believe it can be improved?
Secretary Vilsack. Mr. Chairman, we engaged, at the
beginning of the administration, in a workstudy group with the
Department of Health and Human Services. It has, in a sense,
jurisdiction on food safety issues, as you well know. We handle
roughly 20 percent of the food needs of this country. The Food
and Drug Administration (FDA) handles the other 80 percent.
What we wanted to be able to do, and what I think you
accomplished with the food safety legislation passed last year,
was to begin to create parallel tracks, for both the FDA and
the USDA, focused on a philosophy of prevention rather than
reaction. I think that the food safety proposal that you passed
is a very good, significant step forward. We are working with
the FDA as they begin the process of implementing that. We've
provided staff to assist them in rulemaking, and we'll make
sure that we parallel as best we can.
We've also, Mr. Chairman, improved our communication
between the two Departments so that we're in a position to know
what FDA knows and they're in a position to know what we know,
so that we do a better job of regulating the safety of the food
supply, particularly as it relates to school lunch purchases
and the school lunch program, where we had a problem early in
the administration. So, I'm confident that we will be able to
do a better job of protecting the food safety concerns of
Americans.
There's still work to be done. We are proposing in the
budget additional support for the Public Health and Information
System, which will provide us data that will allow us to do a
better job, within USDA, of determining where there may be
potential problems, and address those problems before they
manifest themselves into difficulties.
We are also continuing to work on the Uniform Incident
Command structure, which will allow us to do a better job of
communicating with State and local public health officials. In
the event there is a concern or a problem, we'll try to contain
it and mitigate it, as best as possible.
We will continue to work, within USDA, on better testing,
and more appropriate testing, to ensure that we are catching
and identifying pathogens. As the science evolves, so must our
testing.
Senator Kohl. Thank you.
We'll turn now to Senator Collins, and then Senator Moran.
Senator Collins. Thank you, Mr. Chairman.
First, let me thank you for holding this hearing.
Also, a warm welcome to the Secretary and the members of
this panel.
The Department's budget request for the year 2012 is a
source of great interest to many Mainers. Farmers across my
State, including blueberry growers, potato farmers, and dairy
producers, all look to USDA for assistance in the areas of crop
research, farm management, and agricultural marketing. But as
we know, the Department's mission is much broader than that,
than simply fostering agricultural production. And it also
plays a key role in spurring economic and infrastructure
development in rural communities around the country. I believe
that most people would be surprised to learn that roughly
three-quarters of USDA's budget actually goes to providing
nutrition assistance. That is why I want to take the time today
to talk about policies in the Department that appear to be
headed toward limiting access to fresh white potatoes within
our Federal nutrition programs.
Let me concede a certain bias here. I grew up in northern
Maine, and my first job was picking potatoes on a farm during
the school recess, for a couple of years, when I was very, very
young.
So, I do want to talk about the fact that the white potato
is the only vegetable excluded from the Special Supplemental
Nutrition Program for Women, Infants, and Children (WIC)-
approved food list. And the Department is proposing to place
strict limits on the use of potatoes for the national school
breakfast and lunch programs.
So, I have a visual aid here that I want to use to
illustrate my point, because if you compare the nutritional
content of iceberg lettuce, which is on the WIC list and is not
proposed for limitations for the school lunch or breakfast
program, with that of the fresh Maine potato, there is quite a
difference.
For example, one medium white potato has nearly twice as
much vitamin C as this entire head of iceberg lettuce. Per
serving, potatoes contain more than four times the potassium as
iceberg lettuce, and more potassium than bananas, a fruit that
we think of when it comes to potassium. Per serving, potatoes
contain twice as much dietary fiber as the iceberg lettuce, and
three times more iron than iceberg lettuce, which we know is so
important to pregnant women.
So, my question, Mr. Secretary, is, what does the
Department have against potatoes?
Secretary Vilsack. Absolutely nothing, Senator. The reality
is that when you take a look at the WIC program, it is
absolutely supplementing the purchases by the mom or the dad
that's using the WIC program. And what we know from research is
that moms and dads understand what you have outlined, which is
the significant nutritional value, and the dollar value, of
purchasing potatoes. And for that reason, they are already
purchasing potatoes in great quantity. So, what the WIC program
is doing is, it's essentially supplementing those potato
purchases with purchases of other vegetables that are not
normally purchased or not purchased in the quantity that
potatoes are purchased. So, in other words, it's not
discriminating against potatoes, it's recognizing that potatoes
are already being purchased by WIC recipients.
As it relates to the school breakfast and school lunch
programs, we are working--I had a meeting with the Potato
Council just recently, and we're willing to take a look at
opportunities to look at potato consumption in the school
breakfast and school lunch programs. What we want to do is,
obviously, move away from the fried nature of what most schools
are preparing. That's essentially the equipment that they have.
We obviously want to take a look at ways in which we might be
able to provide other alternatives for producing those potatoes
so that they are not as caloric--high in caloric content and
fat content, because, as you know, we're trying to deal with a
significant obesity issue.
So, it's not the potato, it's the way in which the potatoes
are being produced or being provided.
Senator Collins. Thank you, Mr. Secretary. I hope you will
take a look at that.
I would suggest, since my time has expired, that the
Government sends a signal when it lists every other vegetable
except the potato for the WIC program and when it proposes to
limit the use of potatoes in the school lunch or breakfast
program. That signal can be perceived as a negative one. I know
that's not your intent, but it can be perceived as saying that
potatoes are not healthy, when, in fact, when we do that
comparison--and I have nothing against iceberg lettuce----
Secretary Vilsack. High value of vitamin K, by the way,
that head of lettuce.
Senator Collins. I'm sorry?
Secretary Vilsack. It's a high value of vitamin K.
Senator Collins. K. Yes, but when you compare it with the
fiber, vitamin C, and potassium, it doesn't stack up. I'm not
saying this should be banned. I'm saying that neither should
this be.
Secretary Vilsack. Right.
Senator Collins. So, I do appreciate the fact that you're
willing to work with the industry about what you would perceive
as more helpful ways of preparing the potato.
Thank you.
Thank you, Mr. Chairman.
Senator Kohl. Thank you very much, Senator Collins.
Before we turn to Senator Moran, I'd like to ask our
ranking member to make his statement and ask for questions.
Senator Blunt. Thank you, Mr. Chairman. I think I'll take
my questions in order. Thank you. Sorry to be late for the
meeting. I certainly look forward to working with you on this
subcommittee, and was pleased to get a chance to visit with the
Secretary just a few days ago.
But I am pleased to be here. And I'll take my questions in
the order that I arrived. Maybe Mr. Moran will ask better
questions than I might have asked, anyway.
So, thank you, Chairman.
Senator Kohl. All right. Very good.
Senator Moran.
Senator Moran. Mr. Chairman, thank you very much. And thank
you, Mr. Blunt.
I'm honored to be a member of the agricultural
appropriations subcommittee. I spent the bulk of my time, in
the House of Representatives, as a member of the authorizing
Committee. Certainly, the jurisdiction of our subcommittee is
of great interest to many, many Kansans, and has a huge
consequence upon American producers, as well as American
consumers.
I welcome the Secretary and look forward to working with
him in my current capacity.
And I just want to direct my questions in a couple of
areas. First of all, agricultural research. I believe that
agricultural research is a significant component of what we can
do to be of assistance to agriculture, as well as those who
purchase agriculture commodities. USDA has a significant role
to play. I think, generally, we've fallen behind in regard to
the resources going into agriculture research, as compared to
other research. And in particular, I wanted to focus on the
competitive grant research program, Agriculture and Food
Research Initiative (AFRI). I've tried to find out, in my short
6 weeks of being a Member of the Senate, how that money is
spent.
So, Mr. Secretary, my hope is, either today or at an
appropriate time, you could give me a list of the Department's
priorities, how that money is categorized, and what your
suggestions are for increasing or decreasing funding within
those various categories, so I can get a better understanding
of what the priorities of the Department are, and to, from my
perspective, make sure that you continue to focus, or that you
again focus, upon production agriculture in the research
concepts that you pursue.
Secretary Vilsack. Senator, if you want, I can provide you
some background about that today, and supplement it if it's not
satisfactory.
We have increased our commitment to competitive grants. We
believe this is one way of leveraging additional resources.
There are a number of key areas in which we focus these
competitive grants.
First, I would say that we have grants that are focused on
both commodity and livestock production and protection. That
has to do with how do we make farms more efficient, in terms of
their capacity to create more production? And how do we protect
them against pests and diseases, invasive species and the like,
that could potentially cut down on productivity? So, that is
one key area.
We are also spending some time and some resources on
biofuels, ways in which we might be able to use a wide variety
of crops, crop residue, and waste products to be able to
produce biofuels to supplement what we're doing with a corn-
based ethanol process, to expand beyond that. As we know, the
Renewable Fuel Standard requires us to get to 36 billion
gallons by the year 2022. To do that, we need substances other
than corn, so we're doing some research in that area.
We are obviously focused on food security issues, in terms
of our capacity to meet the growing need that we not only have
in this country, but, as well, the global need. As you well
know, the world population is scheduled to grow to 9 billion-
plus by 2050. The question is, how are we going to feed those
folks? What is America's role in feeding those folks? How do we
maintain security--food security? That's part of the research
that is underway with the AFRI grants.
We are also taking a look at ways in which agriculture will
have to adapt or mitigate the consequences of climate change
that may impact itself in less water, higher temperatures, more
opportunities for drought, more flooding conditions, what we
can do to make sure that we don't see a significant decline in
productivity.
We are also taking a look at resources in the area of
nutrition and obesity, given the very significant impact that
we have with a third of our children being obese, and the
consequences of that to our national security and educational
achievement. We think that's an appropriate place for some
resources to go, in terms of our competitive grants.
That gives you a general overview. There's probably more
specifics that you'd like, and we'll be happy to provide those.
[The information follows:]
AGRICULTURE AND FOOD RESEARCH INITIATIVE--FOCUS AREAS
[In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
Fiscal year 2011 Fiscal year 2012
Focus area Fiscal year 2010 \1\ \2\
----------------------------------------------------------------------------------------------------------------
Bioenergy................................................. $40,000 $40,000 $48,239
Global climate variability................................ 55,000 55,000 60,058
Global food security...................................... 15,000 15,000 31,980
Nutrition and health...................................... 25,000 25,000 33,520
Food safety............................................... 20,000 20,000 28,520
Foundational areas \3\.................................... 80,773 80,773 89,605
NIFA fellows.............................................. 6,045 6,045 11,480
Legislatively authorized set-asides....................... 20,664 20,664 21,253
-----------------------------------------------------
Total, AFRI......................................... 262,482 262,482 324,655
----------------------------------------------------------------------------------------------------------------
\1\ Fiscal year 2011 annualized level as presented in the fiscal year 2012 President's budget.
\2\ These numbers reflect redirection of funding for the Institutional Challenge Grants and the Graduate
Fellowships programs into AFRI. Institutional Challenge Grants funding has been equally allocated across the
AFRI Challenge Areas. The Graduate Fellowships funding has been added to the NIFA Fellows program.
\3\ These are considered investments in each of AFRI's congressionally established priority areas, as follows:
--plant health and production and plant products;
--animal health and production and animal products;
--food safety, nutrition, and health;
--renewable energy, natural resources, and environment;
--agriculture systems and technology; and
--agriculture economics and rural communities.
Senator Moran. Mr. Secretary, I would love to see the
breakdown, in dollars, in each one of those areas, and kind of
the trend in which I see the Department going.
GRAIN INSPECTION, PACKERS AND STOCKYARDS ADMINISTRATION RULE
I'm going to try to ask a very brief question, which the
answer can be yes or no. I asked the Department, last
September, to do economic analysis--Mr. Glauber, to make
economic analysis available in regard to Grain Inspection,
Packers and Stockyards Administration rules. I'm pleased to
know that you're doing that. And I am asking whether or not--
once that economic analysis is complete, whether the Department
will allow for public comment.
Secretary Vilsack. Senator, if I can, that's not as easy of
a question to answer with a yes or no. And the reason is that
in order to explain how we went about this process--we
solicited comments, as you know, it generated a substantial
amount of comments. We're taking those comments into
consideration, categorizing them, and they will help to inform
the analysis that Joe and his team will do. I've instructed
them to do a thorough analysis, a complete analysis. Obviously,
we want to make sure that, once we present the final rule for
review and for implementation, that it's a solid rule, one that
we can justify. And given the extent of the comments, I'm
confident in Joe's team, that they'll be able to provide an
analysis that can pass muster and that will lead to a good
product that we can support and defend.
Senator Moran. I would encourage you, Mr. Secretary, to
allow a very transparent post-economic analysis process at the
Department.
Thank you, Mr. Chairman.
Senator Kohl. Thank you, Senator Moran.
We'll turn to Senator Brown, and then Ranking Member Blunt.
Senator Brown. Thank you very much, Mr. Chairman.
Secretary Vilsack, nice to see you.
Mr. Chairman, I know that Wisconsin produces more cheese
than any State in the country, but you should know that Ohio
produces more Swiss cheese than any State in the country, and
that I grew up on a dairy farm, working on a dairy farm,
milking Guernseys and Holsteins. So, if you want to know more
about Swiss cheese, I'm your guy, right?
I chose this subcommittee, on the Appropriations Committee,
for a couple of reasons. One is that one out of seven Ohioans
are employed in agriculture--not too different from many other
States in this country--but also because of the priorities of
this Committee, the subcommittee, under Chairman Kohl's
leadership, had been pretty much exactly right--putting food on
the table and fighting hunger in America and abroad, about
ensuring families don't have to worry about the quality and
safety of the food that we buy in supermarkets; about ensuring
that our Nation's children grow up strong and healthy, and
their mothers have the support and nutritional foundation they
need to succeed; and about cutting-edge research to bear on our
Nation's most difficult problems. And this subcommittee has
pursued those as priorities, and I'm appreciative of that and
laud that.
BROADBAND
I have a couple of questions, Mr. Secretary. During the
2008 farm bill, several of us worked--in the Agriculture
Committee--to rewrite the broadband section of the bill to
ensure wider access for communities that are underserved. And
you were in Ohio, and worked on that and discussed that and
helped to begin the implementation. I understand USDA, today,
announced the implementation of the new language for broadband.
Could you just briefly give us your thoughts about that?
Secretary Vilsack. Sure. Senator, we certainly agree with
the observations contained in the 2008 farm bill, that there
needed to be a more focused effort on broadband expansion in
unserved and underserved areas. You all basically instructed us
to take a look at how to define ``rural'' with respect to
broadband expansion. And the interim rule, the final rule, that
we proposed today, we're talking about communities of 20,000 or
less that are not located adjacent to, or near, an urban area.
We have instructed our folks to take a look at giving priority
to unserved and underserved areas.
Our hope is that there are sufficient resources for us to
continue the good work that was done with ARRA. ARRA allowed us
to fund 330 projects, impacting 7 million Americans in rural
areas, potentially 320,000 businesses having access to
broadband, as well as 32,000 anchor institutions, like schools,
libraries, and hospitals.
We obviously want to continue that, because the Department
of Commerce recently put out a map of the United States,
showing some of the holes, if you will, in terms of coverage.
We want to try to address those with these rules.
So, we've put the rules out. We've put out an application
process that will be on the Web, and we're encouraging folks to
get comments in, before May 14, on the structure we proposed,
and to begin the process of applying for resources.
Senator Brown. Thank you.
I will submit several questions for the record on topics
important to Ohio, especially something we've talked about, the
Agricultural Research Station in Wooster, and what we can do on
that.
[Senator Brown's questions were not available at press
time.]
BEGINNING FARMERS
Senator Brown. And the other question I'd like to ask now
is--comment and question, Mr. Secretary--the average age of
farmers, as we know, in all of our States, is now 57, and going
up--and we all are concerned about what that means, attracting
young people into agriculture. How do we better target Farm
Service Agency (FSA) loan programs and other USDA assistance,
to help launch careers for beginning farmers?
Secretary Vilsack. Senator, we're cognizant of that issue.
Thirty percent of our farmers are older than the age of 65, as
well. We saw a 30-percent increase in the number of farmers
older than 75, and a 20-percent decrease in the number of
farmers younger than 25. There are a couple of things.
No. 1, focusing our Beginning Farmers and Ranchers Loan
Program, which we have been doing. We've got the Office of
Advocacy and Outreach, that is focused on strategies for
beginning farmers.
No. 2, I would say that we are doing a better job of using
our direct loan capacity. I may be wrong on the percentage of
this, but a substantial percentage, maybe up as high as 50
percent of our loans, on the direct loan side, have gone to
beginning farmers, as well as about 19 percent going to
socially disadvantaged farmers. So, we are making an effort to
direct our credit efforts in a way that helps beginning
farmers.
But I think there has to be, as we begin the debate and
conversation about the 2012 farm bill, I think this is one area
that we really need to focus on. We've got some ideas and
thoughts. I know my time is up, but I'd be happy to share them
with you or the subcommittee, at a later date, relative to how
we can identify young people who are interested in farming, how
we might be able to use the tax code to encourage farmers who
have no relatives to pass the farm on to, to get young people
engaged, to get sweat-equity opportunities. There are a whole
series of things that need to be done.
Senator Brown. Thank you.
Thank you, Mr. Chairman.
Senator Kohl. Thank you very much, Senator Brown.
Senator Blunt.
PREPARED STATEMENT
Senator Blunt. Thank you, Mr. Chairman. Again, I look
forward to working with you on this subcommittee.
I'll have a statement for the record and some written
questions, I'm sure, as well.
[The statement follows:]
Prepared Statement of Senator Roy Blunt
Good afternoon. Thank you Chairman Kohl for holding today's hearing
on the U.S. Department of Agriculture's (USDA's) fiscal year 2012
budget request, and thank you to our witnesses for being here today.
This is my first hearing as ranking member of the Agriculture
subcommittee, and I look forward to working with the chairman and other
members of the subcommittee as we determine funding levels for the
Department during an era where we must show restraint, and everything
must be on the table.
While we are still working to get our fiscal house in order for
fiscal year 2011, we are looking forward to fiscal year 2012. The task
that has been placed before us, Mr. Chairman, is not ideal. How we
respond to this responsibility is important for the taxpayers and our
economy as a whole. We're at a crucial moment in our Nation's history,
and the decisions we make now will define who we are going to be as a
country.
We are all aware of the current state of our economy. Americans are
gravely, and rightfully, concerned about the size of the national debt
and the budget deficit. As we begin to formally review the
administration's budget request, we have to recognize that every $1 we
appropriate will be borrowed and must be repaid with interest. The
Government must start operating under the same rules that families
across America face every day when balancing their checkbook.
Last week, the Government Accountability Office released a report
on duplicative efforts throughout the Government that highlighted more
than 30 programs at USDA. The President's budget also proposes a series
of program consolidations and terminations at the Department. Both of
these proposals should be thoughtfully and seriously considered.
While tackling these difficult funding decisions, we do so with an
understanding of the important role that agriculture plays in our
economy. We should invest taxpayer dollars wisely in agriculture
programs that will increase our agricultural communities'
competitiveness here and abroad because agriculture is a leading driver
in our economic recovery.
For example, research supports more efficient, higher-quality
agricultural production and the continued development of new and
existing biofuels. That same research also supports American farmers
and rural communities by giving them the tools to be more competitive
in the global economy.
Agriculture products remain the one highlight in our export
portfolio. The Secretary notes in his written testimony that every $1
billion worth of agricultural exports supports an estimated 8,000 jobs.
Agriculture exports from Missouri alone support more than 37,000 jobs.
We have to continue to expand access to foreign markets because a
thriving agriculture industry is key to our economic recovery. It's
time to move forward with the free trade agreements with South Korea,
Columbia, and Panama.
Mr. Secretary, I look forward to hearing your thoughts on these
important issues. Again, thank you Chairman Kohl for holding today's
hearing.
CROP PRODUCTION
Senator Blunt. I may have missed it, but, in your response
to Senator Moran's question about agricultural research, I
didn't hear as much as I would hope to hear about plant
research, about having better results from less and less
acreage, or on the same amount of acreage as we struggle to
feed a growing world. I know that's one of your priorities, but
I'd like to hear your thoughts on that.
Secretary Vilsack. Senator, I did--I actually started with
the first area of emphasis, in terms of our competitive grant
program, is on crop and livestock production and protection,
which is precisely to your point of how----
Senator Blunt. Actually, I thought that was more the
implementation of things we thought might work than trying to
develop what might work, which was my point.
Secretary Vilsack. No, no--the question was about
competitive research grants. And this has to do with developing
new ways to produce, to become more efficient, more effective.
It's precisely the point that I'm making.
Senator Blunt. Good.
Secretary Vilsack. As well as on the food security side,
how do we learn from our experiences in other countries that
may be drought-stricken, may be struck with floods? How can we
create, potentially, new products that would be more inclined
to be productive in very adverse weather conditions? That's
part of the research, as well.
TRADE AGREEMENT
Senator Blunt. Good. On the ``other countries'' front, we
have three trade agreements. I understand they could mean an
additional $2.3 billion in meat and poultry exports alone. That
could add almost 30,000 new jobs in our economic recovery. What
is the position you and the Department are taking on each of
those three agreements?
Secretary Vilsack. We are very supportive, obviously, and
hope to have quick ratification, of the Korean Free Trade
Agreement, which has been completed. That will basically allow
60 percent of the tariffs on about $5 billion of agricultural
products to be removed immediately; the other 40 percent, over
a period of years. You're correct, it will increase
opportunities for us and make us far more competitive. We want
it to be done quickly, because, obviously, we risk the
possibility of Korea making a deal with Australia and other
countries, where we could potentially lose market share.
It's my understanding that Ambassador Kirk has been
instructed to complete the discussions and negotiations on the
Colombian and Panama Free Trade Agreements, and we're excited
about that opportunity, as well. We hope that the Korean Free
Trade Agreement's passage will provide momentum for the passage
of the other two free trade agreements.
It's not just those bilateral agreements, it's also the
multilateral discussions that are taking place--the
Transpacific Partnership, which the President is very
interested in embracing--as well as our efforts at USDA in the
Foreign Agricultural Service to reduce barriers to trade. We've
seen a lot of that happen, in part because of the growing trade
surplus that we're experiencing in agriculture. We project it
to be $47.5 billion this year, which will be a record, in terms
of sales, by almost a $20 billion increase more than last
year's record. Every $1 billion of agriculture sales creates
8,000 to 9,000 jobs. So, we are certainly supportive of this,
and encouraging quick action.
Senator Blunt. Very good.
On the other two agreements, not for today, but I'd like to
know what you think, for Colombia and Panama, the best markets
are. For example, wheat or other markets that might benefit.
Regarding the beef market, and again, I think your point is
well made, that if we don't get to those markets before other
people do, you allow patterns to establish that are often hard
to reverse. And I think the beef area still needs some work,
but it's moved some since Ambassador Kirk has worked on it, as
he has.
GAO REPORT ON DUPLICATIVE PROGRAMS
There was a GAO duplication report that came out after you
submitted your budget, and I wonder if that's given you a
chance to go back and look at things to find some savings by
bringing programs to your Department that would be better done
there than somewhere else, or figuring out how to better
accomplish some of the programs that are duplicative.
Secretary Vilsack. I had a conversation with the President,
earlier today, about the whole issue of trade--as you well
know, that there are a number of agencies that are involved and
participate in trade. The challenge is to make sure that the
opportunities and the tremendous advantage that we have in
agriculture, in whatever structure, whatever ultimately comes
about, in terms of restructuring or reorganization, is not
impacted negatively. This is a good-news story. This is a
positive story. It's one we want to build on, we want to
continue. We've got really good people working at Foreign
Agricultural Service, breaking those barriers down. We want to
continue that.
We are constantly looking for ways in which we can
restructure and reorganize within the USDA. We have a Process
Improvement Program underway, which is identifying efficiencies
and savings. As we deal with difficult budgets, as we deal with
decisions you all will make, they will obviously impact
personnel. Our only request is that you give us sufficient time
in which to manage it properly.
As I said earlier, if we try to shoehorn in a solution to
budget problems that have accumulated over a number of years
into a short period of time, it makes it much more difficult
for us, as managers, to do an effective job and to minimize the
negative impact that it may have on the American public. We
don't want that. You don't want that. We just simply need
appropriate time.
I haven't had a chance to look at the GAO report in its
totality. I know that there are issues concerning food safety.
And as we are working with the FDA to make sure that we are
coordinating our efforts so that we have, in a sense, a virtual
food safety agency, in terms of its capacity, in terms of its
philosophy, focused on prevention, as opposed to just reacting.
We want to be able to be proactive. We want to prevent problems
from occurring before they happen.
Senator Blunt. I remember one point in that report was that
FDA is responsible for the safety of shell eggs, and USDA is
responsible for the safety of processed eggs.
Secretary Vilsack. That is a good example, Senator, but,
maybe a better example is the pizza example, that, if it's a
cheese pizza, with respect to Senator Brown or the chairman----
Senator Blunt. Particularly if it's a Swiss cheese pizza.
Secretary Vilsack. That might be tough. But if it's a
cheese pizza, basically, FDA does it. But if there's one
pepperoni slice on it, it's ours. And I think that there are,
obviously, ways.
But in order to do this, I think the first thing is, you've
got to build a foundation. And the way you build a foundation
is to make sure that the philosophies are the same. I think
what we had was a philosophy, because of the quantity that FDA
had, of being reactive to circumstances, to try to mitigate the
impact. And we at USDA--because of our niche, we were looking
more to preventative measure. I think preventative is now what
you all have been able to do with the food safety legislation
that passed last year. You've got us all on the same track,
which I think is very, very important, and I think it's going
to result in improved food safety.
Senator Blunt. I did ask the Housing Secretary the other
day, at a hearing like this, if they had the infrastructure to
handle the rural housing component. They may or may not have.
And what we don't want to do is eliminate programs if your
Department can uniquely serve a purpose that others would have
to create additional infrastructure to do. So, we want to be
careful about it, but we also want to be sensible about it, in
trying to eliminate duplication wherever we can.
Secretary Vilsack. Also, I think that there's a real desire
to avoid--we had this with the U.S. Agency for International
Development, in terms of overlapping jurisdiction and
responsibilities and confusion.
There's a difference, if I can, between rowing and
steering. Steering is the policymaking aspect of this. There
should be consistency. There should be, clearly, somebody in
charge of the steering apparatus. But the implementation--it's
a different set of skills, and somebody ought to be--that ought
to be a separate lane. And if you start confusing the steering
and rowing, you end up not going anywhere.
BROADBAND
Senator Blunt. That is absolutely true. Not for an answer
today, but on broadband, which we're all interested in seeing
that people have access to, I'd like you to come back to me
with a definition of what ``underserved'' means. I know what
``unserved'' means. I don't know what ``underserved'' means,
and I think you get into a really interesting competitive
environment, where you go in and assist somebody to compete
with someone who has gone in and already put infrastructure in,
themselves, without taxpayer help.
Secretary Vilsack. I think the answer to that may be in the
interim final rule that we presented today. We'll get you and
your staff a copy of that.
[The information is available as follows:]
See Federal Register, Monday, March 14, 2011, Vol. 76, No. 49, pgs
13770-13796, Rules and Regulations at http://www.gpo.gov/fdsys/pkg/FR-
2011-03-14/pdf/FR-2011-03-14.pdf
Senator Blunt. Good. I'd like to see it.
Thank you.
And thank you, Mr. Chairman.
Senator Kohl. Thank you, Senator Blunt.
We'll listen, now, to Senator Nelson, then Senator Hoeven,
and then Senator Cochran.
Senator Nelson.
Senator Nelson. Thank you, Mr. Chairman.
And, Mr. Secretary and your colleagues, it's good to have
you here. We appreciate this opportunity to go over some very
important issues.
NATIONAL DROUGHT MITIGATION CENTER
Mr. Secretary, as you know, the National Drought Mitigation
Center at the University of Nebraska, Lincoln, performs a
number of valuable services: monitoring and forecasting
drought, planning for drought, and developing means of
mitigating drought. It's extremely important for farmers and
ranchers for understanding trends that affect food production
and for planning by a number of businesses and individuals. And
the widely used Drought Monitor is published on Thursdays, I
believe. As we all know, these are extremely important.
For a number of years, a number of these beneficial
programs were supported by earmarks. In the absence of
earmarks, do you have any plans for sustaining the National
Drought Mitigation Center through--and its activities--in your
fiscal year 2012 budget?
Secretary Vilsack. Senator, what we have suggested is that
there really does need to be a priority-setting process. There
are a number of projects that have received earmarks over the
course of a number of years. All of them have, I'm sure,
appropriate justification, including the one that's located in
your area, in Nebraska.
I think it would helpful for us to, basically, do a review
of all of those proposals and all of the existing facilities to
determine, what are the highest priorities? When we are dealing
with difficult budgets, it is, at the end of the day, about
choices and priorities. We want to make sure we can justify
whatever decisions are made.
So, there is a priority-setting process in place. I can't
tell you, today, where the Nebraska project is, specifically,
in that process, because it hasn't been completed.
Senator Nelson. I might point out that the project might
exist in Nebraska, but it's nationwide in its implications, and
is used by a number of other entities, as well. Unfortunately
or fortunately, depending upon your point of view, drought is
not just unique to Nebraska. So, others have focused on it, and
I think it's, obviously, a worthwhile project. And I want to
make a pitch for it. Perhaps we can follow up after the
hearing.
And relating to trying to find a way to make a budget work
in difficult and trying economic times, I understand the
challenge that you face. I think it's important for the
American people if we--consider it this way, that if you like
importing 70 percent of your oil, you'll love importing 70
percent of your food.
AGRICULTURAL PRODUCTION
What I'm getting at is, your agency and the programs under
your agency and programs--new farm program and everything we
move forward on, will be designed to try to sustain American
agriculture so we can continue to produce, here at home, our
own food for our own needs: food, fuel, fiber, and feed.
So, I hope that, as we look at cuts, we'll be judicious
and, as you say, prioritize, so that, at the end of the day,
agriculture is not left hanging without a safety net. In
anticipation of bad times, we need to be sure that we are
protecting against those bad times. And it's harder to do it--
in good times, in terms of commodity prices. But in tough
budget times, as we do that, we have to be very judicious and
have very strong prioritization so that we don't end up having
people talk us out of continuing to support agriculture in
advance of the bad times.
Secretary Vilsack. I'm not sure if I have time to respond
to that, Mr. Chairman.
Senator, we obviously agree. We're certainly pleased with
the fact that we have a strong agricultural economy today, but
recognize full well the nature of agriculture could be
difficult tomorrow. There does need to be a strong safety net.
We do have to have shared--as the President says, shared
sacrifice and shared opportunity, and it has to be
proportional. We think our budget reflects those--that balance.
We think it maintains a strong safety net, through a variety of
mechanisms: additional market opportunities, crop insurance, as
well as the payment structures that are in place. We are
suggesting some changes to the payment structure which we think
are legitimate. But we're happy to tell the agricultural
community that we are aware of the need for a strong safety
net.
Senator Nelson. Thank you, Mr. Secretary.
Thank you, Mr. Chairman.
Senator Kohl. Thank you, Senator Nelson.
Senator Hoeven, Senator Cochran.
Senator Hoeven. Thank you, Mr. Chairman.
Secretary Vilsack, good to see you again. You've been up
here a lot, and I know how demanding your schedule is. So, it's
good to have you here.
AGRICULTURAL RESEARCH
First thing I want to touch on, for just 1 minute, is a
follow-up to both my colleagues, Senator Moran and Senator
Blunt, in emphasizing the importance of agricultural research.
I think it pays incredible dividends. And obviously, we're
going to have to tighten up on these budgets. We have a
spending issue. And from what I've seen, agriculture will
certainly take its share of the load. Some of us may feel it's
even taking more than its share of the load. And I think that's
borne out by some of the percentages I've seen so far.
But good farm policy is important to every single American
and people all over the globe, as you well know. We have the
lowest-cost, highest-quality food supply, not only in the
world, but in the history of the world, thanks to our farmers
and ranchers.
But I'm wondering if there's some flexibility that we could
give you, in your budget, that would help. And a couple
different areas. Agricultural research. I think that's
incredibly important. If you have some ability to move dollars
around, that might help us do more through our universities and
extensions, so forth, to do a good job on agricultural
research. Biofuels development. Also, even in the area of, with
the Rural Utilities Service (RUS), some of the new clean coal
technologies, which actually comes under your purview through
RUS.
Is there something we can do with flexibility, in these
times when there are going to be less dollars, that can really
help, in terms of doing the job--make your budget go further
for agriculture?
Secretary Vilsack. On the research side, Senator, we're
trying to do that by increasing, over what we had last year,
the competitive grant program. We think that that is a way in
which we can more effectively leverage scarce Federal resources
to partner with private resources and the land grant
universities to extend our research opportunities.
ENERGY PROGRAMS
You mentioned RUS. We are proposing, in this budget, the
capacity to use a portion of $6 billion in loan authority to be
able to better assist existing facilities that might be fossil
fuel-based, as they look for new renewable opportunities for
peak production, for efficiencies and improvements, and more
flexibility in being able to use those resources to help assist
in the development of those improvements. That would be
something that could be helpful.
Senator Hoeven. So, that is something we could work with
your people, in terms of your budget, that--clean coal
technology, the RUS loan program is a great example. How do we
make sure--same thing in biofuels--second-generation cellulosic
development for ethanol, other--and biodiesel.
Secretary Vilsack. Well, the biofuels----
Senator Hoeven. We need to get that creativity going in the
private sector.
Secretary Vilsack. You're right.
Senator Hoeven. We need to get your dollars into those
projects.
Secretary Vilsack. On the biofuels side, I think the
Congress and the President have been of one mind, in terms of
getting the energy title of the farm bill implemented. And we
are attempting to do that with new biorefineries that are being
financed with the Biomass Crop Assistance Program, with
advanced biofuel producer assistance. All of that is underway.
So, I think we're doing a pretty good job on that. But we're
certainly willing to work with you in other ways.
I will tell you that I have a deep concern--this is a
little far afield from your question, but I have a deep concern
about the cliff that some folks want to create, in terms of the
incentives that are currently in place for the biofuel
industry. I think, if you create a cliff, what you're going to
see is a drop in production. You're going to see a loss of
jobs. I think it would be much better to have a glidepath
towards ultimate elimination of those incentives--but, a
glidepath. And perhaps a redirection of those incentives in a
way that helps blender pumps, helps build greater demand with
flexible fuel vehicles. That kind of thing could be very
helpful to us.
So, I think there are a number of ways in which we can
help.
Senator Hoeven. Blender pumps, flex-fuel vehicles, higher-
blend standard, working with the Environmental Protection
Agency--I think we can transition to some of those measures
that can still help the industry grow, but that don't create a
cost, necessarily, for the Federal Government.
Secretary Vilsack. Right. Or reduce the cost that we've
been incurring over time.
Senator Hoeven. Right. Thank you.
Senator Kohl. Thank you, Senator Hoeven.
Senator Cochran.
Senator Cochran. Mr. Chairman.
Mr. Secretary, welcome to the subcommittee. We appreciate
your cooperation with us in attending the hearing.
CATFISH INSPECTION PROGRAM
While we understand that the Department has been
considering releasing some catfish inspection regulations and
beginning to implement a program, we've not seen any final
action taken, or specific requests for funding, for enforcement
of the program. What is the status of that issue, if you know,
particularly as it relates to aquaculture activities?
Secretary Vilsack. Senator, we just recently put forward
for comment and consideration, specifically as it relates to
catfish, a responsibility that was given to us statutorily, a
new inspection program. We expect and anticipate that there'll
be quite a bit of comment, relative to precisely how extensive
that inspection process should be, in terms of the varieties of
catfish that should be included.
I didn't know how many different varieties of catfish there
were until I got this job. I just thought there was one kind,
out in the Mississippi River. But I find that that's not the
case. There are quite a few more.
So, our view is that it's going to take some time for us to
sort of get our hands around precisely what we will be
regulating. Therefore, it would be a bit premature this year to
ask for resources for an inspection process, or enforcement
process, when we don't have the program in place. We anticipate
it will take us a little time to get it in place.
Senator Cochran. We would encourage you to move ahead on
it. We hope you don't do like we do here in the Senate
sometimes, and just kind of filibuster, talk, talk, and nothing
really happens. We hope the administration will cooperate with
this subcommittee, and collaborate on defining a new regime,
and then let us provide the funds to pay for it.
Thank you, Mr. Chairman.
Senator Kohl. Thank you very much, Senator Cochran.
FARM SERVICE AGENCY LOAN PROGRAMS
Mr. Secretary, for the past 2 years, private credit markets
provided insufficient credit to support farmers and ranchers,
due to the recession. As a result, this subcommittee had to
increase support for FSA loan programs. Wisconsin is the
largest user of these programs, with a loan portfolio of more
than $1.3 billion. And they are particularly important for the
dairy industry. This budget cuts those programs by 6 percent.
Can you give us some assurances that private credit markets
will provide adequate credit for farmers and ranchers in fiscal
year 2012?
Secretary Vilsack. Mr. Chairman, I think the most
significant reduction in the loan programs is a program that
provided not just a loan, but also interest assistance. Given
the difficult times, our feeling was that there obviously are
priorities, and our priorities should be on the direct loan and
the guaranteed loan programs without interest assistance.
We are seeing a better credit circumstance, in terms of the
capacity to get credit. That's probably in part because farm
prices are better. It's in part because we're seeing fewer
defaults. We're seeing fewer efforts to restructure or ask for
additional time in which to pay. Therefore, we're fairly
confident that the numbers we've provided should be adequate to
meet the credit needs of our farm community, given the
circumstances as they exist today. But as you know, things
could change in the next 3 or 4 months. We're keeping an eye,
obviously, on energy costs. That may have an impact on all of
this. But at this point in time, we're confident that we'll be
able to meet the need with what we proposed.
GOVERNMENT SPENDING CUTS
Senator Kohl. Mr. Secretary, as we've all been trying to
find ways to reduce Government spending, we received from the
Office of Management and Budget (OMB) a list of suggested
places to cut spending across the entire Government. That list
included 38 items, of which 12 out of the 38 were from USDA.
Those USDA programs included cuts of $1.5 billion, from a total
of $6.5 billion on the entire OMB list.
So, can you explain why OMB seems to be focused so much on
USDA spending? Are these USDA programs really not that
important? Does USDA simply have too much money these days, or
does the administration have huge amount of regard and respect
for your ability to create efficiencies?
Secretary Vilsack. I'd like to think it's the latter, Mr.
Chairman. But in all seriousness, we at USDA recognize the
responsibility because of the people that we work with and
represent and work for--the folks in rural America, who I
think, themselves, understood something about that long ago,
which is one of the reasons why the agricultural economy is
probably a little bit stronger than other parts of the economy,
because there wasn't quite as much debt. We're seeing, right
now, an 11.3-percent debt-to-asset ratio in farm country, which
is a solid ratio.
So, we stepped up last year, with a $4 billion savings on
the crop insurance. We were asked to identify, consistent with
the President's instructions, a number of reductions that would
take place within a reduced discretionary spending number.
We've provided those to OMB. And I think what you see is a
reflection of OMB's efforts to accelerate what we have
identified in the fiscal year 2012 budget as a way of assisting
the Congress in trying to finalize the fiscal year 2011 budget.
Will these reductions be easy? No. If I had my druthers,
I'd like to live in a world where we had unlimited resources
and we didn't have to deal with these issues. But the reality
is, American families are dealing with them, and they expect
their Government to do the same. And we want to be reflective
of that value.
Senator Kohl. All right. Senator Pryor, we'll turn to you.
Senator Pryor. Thank you, Mr. Chairman.
Secretary Vilsack, always good to see you. Thank you for
being here today.
Let me start by picking up on something that Senator
Cochran said just a few moments ago. And that is that catfish
is an important industry, of course, but even more than that,
it's an important food source for people, and it's important
that consumers know what they're eating and can be assured that
it's safe to eat. So, I hope that the USDA will continue to
move down the tracks with your new catfish rule.
NATIONAL INSTITUTE OF FOOD AND AGRICULTURE
Let me, though, ask a question about the National Institute
of Food and Agriculture (NIFA). I have a question, generally,
about the administration's decision to recommend some of these
cuts, because as some of my colleagues have said already,
agriculture is a fairly strong sector of the U.S. economy. I
think you just mentioned that. And we are not doing well, when
it comes to exports. We have a huge trade deficit. The
President has come out and said he wants to double exports
within so many years. It seems to me that we're a world leader
in exporting of agriculture products, and so I'm not sure why
we should be cutting that. We want to see economic recovery. We
want to see a more stable, more robust economy in this country.
And really, the foundation of rural America's economy is
agriculture.
So, I was going to ask about NIFA. But just generally, why
are you recommending some of these cuts? And particularly with
NIFA, which is agricultural research and is doing great things
all over the country. Why are we cutting now? I understand
we're in a difficult budget environment, but tell me the
administration's thought process.
Secretary Vilsack. I would say two things.
First of all, as it relates to exports, I want to make sure
I make our budget clear, Senator. We are proposing, actually,
in that area of the budget, an increase of $20 million. And we
believe that that increase--based on experience, every $1 we
spent on export assistance last year netted $35 of trade. So,
that's actually an increased item on our budget.
Senator Pryor. Right.
I think it's great. That's why we need the product in the
pipeline.
Secretary Vilsack. It can create economic opportunity.
As it relates to NIFA's budget, basically, we are
increasing the competitive grant program within NIFA. Our
belief is that, by increasing that part of NIFA, of AFRI, we
will be able to leverage an equal or greater amount of overall
dollars within research. So, while it obviously is, in total,
less money, we think by increasing a part of that budget, we
can make up for whatever reductions may take place in other
parts of the research budget.
And it's primarily in the areas of formula funding, a small
reduction in formula funding, an increase in competitive
grants, because competitive grants, we believe, have the
greater potential for accessing additional dollars into
research. This administration has been a supporter of research,
and has been proposing additional resources for research, over
the last couple of years.
Senator Pryor. Thank you, Mr. Chairman.
Senator Kohl. Thank you very much, Senator Pryor.
Senator Blunt.
Senator Blunt. Thank you, Chairman.
DISCRETIONARY FUNDING LEVELS
What is the fiscal year 2010 number that you're working
under now, the fiscal year 2012 number, and the fiscal year
2008 number? If somebody could give me the bottom line. I don't
expect you to know that, without looking it up, but you might.
Secretary Vilsack. I know that the net discretionary
appropriations for fiscal year 2010, enacted, was $26 billion.
In the fiscal year 2011 budget, what we proposed was a little
more than $25.5 billion. And the fiscal year 2012 number is
less than----
Senator Blunt. This is net discretionary, right, Secretary?
Secretary Vilsack. Yes.
Senator Blunt. The other number I'd like to know is what
the 2008 number was for net discretionary.
Secretary Vilsack. The fiscal year 2012 budget number is
almost $24 billion--$23.8 billion. The fiscal year 2008 number
is $21 billion.
Senator Blunt. Okay, that's helpful. Thank you.
BUDGET PRIORITIES
What are the three top priorities that you have for the
year for the Department? And why would those be your three top
priorities?
Secretary Vilsack. That is a really difficult question,
given the scope of what we do at USDA.
First and foremost, we obviously want to continue the
momentum that's been building in rural America, in terms of job
growth and economic opportunity. We've got a strong
agricultural economy. We want to continue to build on that. We
have a strategy of expanding broadband, of making sure the
biofuels industry is supported, of doing a good job of using
our conservation resources in a way that builds outdoor
recreational opportunities, which we think can help build the
rural economy. And the ability to build local and regional food
systems creates job opportunities. So, that's one.
Second, we've got a good trade story to tell. We obviously
want to increase the momentum there.
Then we have a responsibility to make sure that safe and
nutritious food is available to every American. So, that gets
into the food safety area. It also gets into the nutrition
programs that are important, with particular emphasis on
implementation of the recently enacted Healthy and Hunger-Free
Kids Act of 2010, a historic opportunity for us to improve,
significantly, the school lunch and school breakfast programs,
given the obesity and hunger issues we face.
Now, there are a multitude of other responsibilities we
have. Invasive species are a big issue, often not discussed in
a context of this budget, because, in terms of dollars, it may
not be the largest part of our budget, but it's extraordinarily
important to crop production and productivity.
There are issues relative to homeownership, that we
discussed briefly earlier. That's an issue.
The credit needs of farmers is an issue. The beginning
farmer. I mean, there are just a lot of issues that you deal
with in this Department.
And asking which of those, of all my priorities, is sort of
like asking which of my two sons I love the most. I love them
all. And we want to work hard to try to advance all of these
priorities.
Senator Blunt. Thank you, Secretary.
I think that is it for my questions, Mr. Chairman.
Senator Kohl. Senator Cochran.
Senator Cochran. I have no further questions.
Senator Kohl. Senator Hoeven.
Senator Hoeven. I have one other question, Mr. Chairman.
CROP INSURANCE
Mr. Secretary, crop insurance is incredibly important for
our producers. It's going to be incredibly important in the
next farm bill. I see, in the budget proposal you put forward,
you're reducing funding for crop insurance by $1.7 billion.
That follows about a $4 billion reduction this past year. But I
think crop insurance is really going to be a cornerstone of our
safety net. It will be a cornerstone of our safety net for our
producers in the new farm bill. How do we improve crop
insurance?
Secretary Vilsack. If I can, let me explain why we're
proposing the reduction. The $4 billion reduction was, in part,
a result of us doing a historical study of appropriate returns
on investment for the insurance industry to provide stability
in the crop insurance arena. What we determined was, a 12-
percent return on investment would be sufficient to promote and
ensure stability. What we did with the crop insurance agreement
was to come down from the 17-percent to a 14-percent return.
So, we think that there is stablility and security.
The proposal we're making this year is in one narrow area
of crop insurance: catastrophic insurance. And the reason we're
doing this is because the loss ratio, not the premiums, but the
relationship with the insurance industry was based on a 1.0
loss ratio. When in reality, historically, it's been far less
than that. So, there are ways in which we can reduce the
exposure to the taxpayers, not increase the cost to producers,
and make the product still available. That's what we're
proposing.
We are expanding crop insurance. We have 14,000 additional
customers in our crop insurance program, as a result of the
program improvements we made last year in range and pasture and
forageland areas. We're looking at a series of organic crops
that could potentially be covered, as well. We're reducing
surcharges on a variety of citrus products, which may not
impact North Dakota, but----
Senator Hoeven. That's funny.
Secretary Vilsack [continuing]. Are obviously important to
folks in the South. So, there are steps that we are taking.
We are also creating a premium refund program for good
producers, those who have historically good records. We've
identified about $75 million that could be returned, if you
will, to producers.
So, I think we're looking--always looking for ways in which
we can expand coverage and create a better program.
Senator Hoeven. I think it's going to be absolutely key
that we work together, particularly as we go into this next
farm bill, on crop insurance. I think that's going to be just a
key, key component. And we have such a good case to make with
it, too, for our producers.
Secretary Vilsack. You're right, Senator. I don't disagree
with that.
Senator Hoeven. Thank you.
Senator Kohl. Senator Pryor, you have a question?
Senator Pryor. I do, Mr. Chairman. Thank you.
THE NATIONAL AGRICULTURAL LAW CENTER
This may seem like a parochial matter, but it really isn't;
it's of national importance. And that is, University of
Arkansas School of Law has the National Agricultural Law Center
housed there. It offers a master of laws in agricultural law,
which I think is the only program in the country that does
that. But even more than that, it is really a clearinghouse for
all kinds of information. Last year, they had 430,000 visitors
to their Web site, wanting to know about agriculture law.
It reminds me--I just finished a book on healthcare--
there's now a new field of economics, called ``healthcare
economics.'' Agriculture is complicated enough, where there is
a legitimate field of agriculture law.
But the Web site also had well more than 1 million hits.
And 20 percent of those--this is just last year's numbers--20
percent of those were Federal employees.
So, this is a real resource that's available to everybody.
Even our own Federal Government relies on it heavily. There's a
lot of very constructive and positive things I could talk about
with the National Agricultural Law Center. In fact, in your
shop, Janie Hipp and Doug O'Brien are former directors of the
center.
Nonetheless, I'm curious to hear your explanation about why
the program is proposed to be terminated and how we might
overcome the adverse effects of a termination.
Secretary Vilsack. Senator, this is just a reflection on
the concern that has been expressed by the President and
others, in terms of specific earmarks. This is a process that
we need to undertake within the USDA, that we are undertaking
within USDA, to establish a priority listing of things that
need to be maintained and things that need to be continued, and
to be able to explain and justify why they need to be
continued. We're undertaking that. And in lieu of that, our
budget reflects an elimination of all of those earmarks.
Senator Pryor. Mr. Chairman, I'm not sure I agree with
y'all's definition of ``earmark,'' but that's something that we
should talk about further, and maybe not in this context. But I
do think it does provide a national service.
Thank you.
ADDITIONAL COMMITTEE QUESTIONS
[The following questions were not asked at the hearing, but
were submitted to the Department for response subsequent to the
hearing:]
Questions Submitted by Senator Herb Kohl
broadband
Question. A recent Washington Post article called the U.S.
Department of Agriculture (USDA) Rural Broadband Loan Program one of
the ``worst ideas in Washington.'' The loan program is eliminated in
your fiscal year 2012 budget, but there will still be money available
from previous years to carry it out.
How do you respond to criticism that the program hasn't focused on
rural America?
Answer. The program is focused on rural America. The issues raised
in the Washington Post article addressed concerns from the USDA
inspector general that the program did not reach the most rural
communities. USDA has used the statutory definition of ``rural'' for
its Broadband program that was enacted through the 2002 farm bill and
then revised the Broadband program in 2008. USDA had no authority to
change the statutory definition and was pleased that the Congress
enacted the inspector general's recommendation to amend the definition
of ``rural'' in 2008. This new definition of rural was used for the
American Recovery and Reinvestment Act's (ARRA's) Broadband Initiatives
Program (BIP) and is used today in our revised farm bill Broadband Loan
program. I am also pleased to report that no farm bill broadband
infrastructure loans to new borrowers were made under this
administration using the old definition of ``rural.'' I am also pleased
to report that the Rural Utilities Service (RUS) has addressed all
Office of Inspector General (OIG) recommendations on the farm bill
Rural Broadband Loan Program and as of March 24, the OIG has now closed
the audit. If the Congress has concerns with the current statutory
definition of rural for our Broadband program, we would be pleased to
work with the subcommittee to draft a new standard.
Question. When will rural America truly be served by high-speed
broadband, which is important for economic development?
Answer. Under ARRA, USDA received more than $28 billion in
applications for BIP. With our $2.5 billion in budget authority, we
were pleased to leverage these funds into 320 awards totaling in excess
of $3.5 billion. In Wisconsin, USDA made 15 BIP awards totaling in
excess of $90 million. For example, USDA provided a $15.5 million loan
and $15.5 million grant to Chequamegon Communications Cooperative, Inc.
(CCC) to offer high-speed broadband to 31 rural communities in northern
Wisconsin. CCC's network will bring high-speed fiber to more than 3,000
new customers including several community anchor institutions. To
further leverage this BIP award, CCC partnered with the State of
Wisconsin on another ARRA project to bring high-speed Internet to
schools and libraries in the area. The project will create or save 66
jobs.
Regrettably, we did not have sufficient resources to reach every
unserved area in rural America. To help reach families and business in
areas unserved by BIP or the Department of Commerce's Broadband
Technology Opportunities Program (BTOP), USDA made $100 million in
awards to satellite service providers to lower the cost of installation
and monthly broadband service to areas that remain unserved after all
BIP and BTOP awards were made.
Finally, USDA has other broadband programs to assist with bringing
broadband to rural areas. Our Community Connect Grant program is
specifically targeted to rural communities that have no broadband
service. The 2008 farm bill Rural Broadband Loan Program offers loans
to bring broadband to underserved and unserved communities. Both
programs are operating under carryover funding this fiscal year and
were part of the President's fiscal year 2011 budget request. The
President's fiscal year 2012 budget did not request funds for the farm
bill loan program but did request an additional $17.8 billion for the
Community Connect Grant program. The fiscal year 2012 budget did not
request additional funds for the Broadband program because it
anticipated sufficient carryover funding would be available.
renewable energy
Question. USDA was given a clear and urgent mandate to promote the
development and expansion of renewable energy, to help diminish the
Nation's dependence on fossil fuels. Recent oil price volatility has
caused us to refocus on this charge. Substantial mandatory funding was
included in the farm bill for this purpose. This subcommittee needs to
know what USDA has done with this mandate and the funding you received.
Specifically:
Please describe the current state of implementation of USDA's
renewable energy programs.
Answer. The interim rules for the Advanced Biofuel Payment Program
and the Repowering Assistance Program were published in the Federal
Register on February 11, 2011. The interim rule for the Biorefinery
Assistance Program was published in the Federal Register on February
14, 2011. Notices of funds availability and a notice contract of
proposal for these programs were published in the Federal Register on
March 11, 2011. The interim rule and Notice of Funds Availability for
the Rural Energy for America Program (REAP) are expected to be
published in the Federal Register by April 14, 2011. The Rural Energy
Self Sufficiency Initiative was not implemented because no funds have
been appropriated for this program.
Question. What are the timelines you envision for bringing new
energy sources on line to reach consumers?
Answer. New energy supplies from biofuels currently being developed
by the Biorefinery Assistance Program will take 3-5 years to allow for
plants to be built, ramped up, and for supplies to reach consumers.
Less complex renewable energy and energy efficiency projects involving
known technologies are being completed anywhere from a few months to a
few years.
Question. What challenges are slowing achievement of your goals?
Answer. Interest in our programs has never been greater. In terms
of market concerns: the availability of private-sector capital and
investments necessary to develop new biofuels and biorefineries is a
challenge. Some lenders are risk averse and the Department has worked
closely with the industry and the investment community to address this
issue.
Question. We need to know which of these programs work and which do
not. How are you measuring success and what can you tell us about
successes and failures?
Answer. All of our programs are working, very popular, and in the
case of REAP, producing measurable results. While awards have been
made, none of the construction projects have been completed. In terms
of applicants: REAP had 2,400 successful applicants in 2010; it helped
to provide an investment of $159 million in renewable energy and energy
efficiency projects in rural America with less than $84 million of
Government grants and helped to produce or save more than 2,900
megawatt hours of energy. The Bioenergy Program for Advanced Biofuels
is providing incentive payments for the production of advanced
biofuels. The program made payments of $19 million to 140 recipients
that produced advanced biofuel during fiscal year 2010. We measure
success of our programs by the geographic diversity of the program
funds, funding a wide range of project technologies, jobs creation,
energy production, energy conservation, leveraging other funds with
program funds, and by providing loan guarantees for the development of
new fuels that will meet the energy demands of our Nation. Upon
request, the Rural Business Service (RBS) will provide summary data for
all of the title 9 RBS programs.
Question. Please describe how you are coordinating the energy
initiatives within USDA, and with land grant universities' research
efforts.
Answer. USDA is working within the Department and with other
Federal departments and organizations, including the land grant
universities, on furthering renewable energy initiatives and programs.
Efforts include the following intra-/inter-governmental panels,
councils, working groups, and boards.
As an extramural research, education, and extension agency, the
National Institute of Food and Agriculture (NIFA) works directly with
land grant universities and others to implement sustainable bioenergy
strategies. These extramural groups carry out the needed work to
advance programs. This is further coordinated with NIFA review of the
State plans of work for noncompetitive funding. Competitive funding
typically brings together university faculty, Federal scientists,
industry, and others to meet national needs related to advancing
bioenergy. This leverages and coordinates Federal, State, and private
funding in most cases.
The USDA Energy Council mission is to advance the contribution of
agriculture and forestry in rural America in promoting the Nation's
achievement of energy security through the efficiency and effectiveness
of the Department's numerous energy-related programs and initiatives.
Chaired by the Secretary of Agriculture and consisting of the Under
Secretaries and other senior managers, the Energy Council leads the
Department in policy development and efforts to reach all audiences to
inform them about USDA energy programs and regulations. The council
ensures that these audiences are aware of the Department's
comprehensive energy program and also understand how it fits into the
United States' overall energy policy.
The USDA Energy Council Coordinating Committee consists of staff
from all USDA mission areas who work on energy issues, coordinates
energy-related activities among USDA agencies and performs duties as
assigned by the Secretary as the Energy Council chair, or the Energy
Council as a whole.
The Biomass Research and Development Board is co-chaired by USDA
and the Department of Energy (DOE). The board coordinates the
Governmentwide research initiatives and activities for the purpose of
promoting the use of bio-based products, power, and biofuels. Members
of the board also include the National Science Foundation (NSF), the
Environmental Protection Agency (EPA), the Departments of the Interior
and Defense, and the Office of Science and Technology Policy.
The Biomass Research and Development Advisory Committee is a group
of approximately 30 individuals from industry, academia including land
grant universities, and State government. The committee is responsible
for providing guidance to the Biomass Research and Development Board on
the technical focus of the Biomass Research and Development Initiative.
The National Agricultural Research, Extension, Education and
Economics Advisory Board's Renewable Energy Committee was created by
the Congress in 2008. This committee annually submits to the advisory
board a report that contains its findings and any policy
recommendations to the USDA in preparation for the annual budget. The
committee also consults with the Biomass Research and Development
Technical Advisory Committee.
Question. How is USDA coordinating efforts with other Federal,
State, and private entities to make sure the most efficient use of
public dollars is taking place?
Answer. We coordinate with DOE, using their environmental reviews
when available for biorefinery assistance projects and we are working
with DOE grant recipients, where we guarantee loans to build
biorefineries that will help to end our dependence on foreign sources
of petroleum. The USDA works closely with DOE to provide the best
energy expertise to our field staff and ensure that all of our project
loans and grants are awarded in accordance with the highest
professional standards. We work closely with EPA to ensure that their
expertise is utilized as well as their efforts to promote anaerobic
digester technology. We ensure that applications for assistance are
selected on a basis of competition using priority scoring so that
applicants selected have a project that is meritorious. REAP provides a
grant for no more than 25 percent of eligible project costs, up to a
maximum amount to an eligible applicant; and the majority of funds are
invested by the applicant who put their own money into the project. Our
programs succeed by utilizing State incentive programs, renewable
portfolio standards, utility incentives, and local and national lenders
making solid investments in partnership with applicants throughout the
Nation.
Question. What is your evaluation of the Department's success in
meeting its renewable energy mandate?
Answer. Based on the purpose of the program and the results
tracked, we determine whether the program is successful. In fiscal
years 2009 and 2010, REAP helped nearly 4,000 rural small businesses,
farmers, and ranchers save energy and improve their bottom line by
installing renewable energy systems and energy efficiency solutions
that will save a projected 3 billion in kWh--enough energy to power
390,000 American homes for a year. In 2010, the Biorefinery Assistance
Program provided a conditional guaranteed for $55 million private loan
to the advanced bioenergy producer Sapphire, once completed the
facility is expected to generate 72 million kWh in renewable energy,
once the biorefinery is built. In 2010, the Bioenergy Program for
Advanced Biofuels provided $18.5 billionin support of the generation of
53 billion BTUs, and the Business and Industry Guaranteed Loan program
provided $43.4 billion in support of renewable energy infrastructure.
plant/animal health
Question. More than $830 million is requested for protection
against invasive species, pests, and diseases. However, there is no
indication in the budget what the real costs of these various threats
are, in terms of market disruption, lost income, diminishment of
producers' capital, etc. It is also unclear what the value is of the
Department's strategies implicit in this request. This budget asks the
subcommittee to make decisions regarding allocating discretionary
resources absent any cost/benefit framework.
This subcommittee needs to know what are the costs facing the
economy of these different threats.
Answer. Invasive pests and diseases can cause huge losses and
control and eradication costs. For example, we estimate that a half-
week delay in finding an animal disease outbreak can increase cleaning,
disinfection, depopulation, and quarantine costs by $70 million per
incident (on average). The light brown apple moth (LBAM) attacks more
than 2,000 types of plants and trees found throughout the United States
and we estimate that it has the potential to cause production losses
ranging from $700 million to $1.6 billion annually if it spreads. The
Asian long-horned beetle's total potential economic impact on
industries in New York and New England is estimated at $1.1 billion in
annual losses.
Question. In addition, what are the benefits that accrue from
expenditures on the various programs?
Answer. The benefits of Animal and Plant Health Inspection
Service's (APHIS') pest and disease programs generally include the
prevention of damage to the commodity or resource at risk, reduced
control costs over time, and continued trade opportunities. For
example, the Asian long-horned beetle (ALB) program protects forest
resources and urban trees nationwide, as roughly 30 percent of U.S.
trees are potential ALB hosts. If urban areas across the United States
were infested with ALB, the estimated potential national impact would
be a loss of 35 percent of the canopy cover and almost $815 billion in
compensatory value. The benefits of the program include protecting
these trees in neighborhoods and parks across the country as well as
preventing the spread of the pest into New England's hardwood forests,
which support the timber, tourism, and maple syrup industries. The LBAM
program prevents the spread of the pest through regulatory and control
efforts. Without the regulatory program to prevent LBAM from spreading,
U.S. trading partners would restrict, if not ban, imports of U.S.
fruits, vegetables, and nursery stock into their countries.
Question. What basis did the administration use to determine the
priorities implicit in the request?
Answer. Our main focus was to determine those programs where we
could have a positive impact on the health of American agriculture and
where we could best contribute to reducing losses caused by pests and
diseases. Recognizing the need to restrain Federal spending, we
reviewed our programs to determine where we could do things
differently. In some areas, the agency was able to take advantage of
program successes to realize savings (examples include the decreases
requested for the cotton pests, screwworm, pseudorabies, and avian
influenza programs). APHIS also identified programs that could be
reduced since eradication or control of agricultural pests or diseases
are no longer considered feasible (such as emerald ash borer), or where
we will request greater contributions from partners or those that
directly benefit from program efforts (such as the potato cyst nematode
program).
Question. Please identify the administration's priorities within
these components.
Answer. Ensuring our ability to prevent the entry of exotic pests
and diseases, quickly detect those that do enter the United States, and
respond in a timely way remain our highest priorities. Our budget
proposes to maintain our strong infrastructure of highly skilled
employees and cooperative relationships with States and industry.
Additionally, there are several emerging needs for which we request
more funding.
APHIS developed the National Animal Identification System in 2004
to enhance the United States' capability to minimize the spread of
foreign and domestic animal diseases of concern. Since then, USDA has
obtained input from stakeholders to develop a more efficient
traceability system. Detecting a disease before many animals have been
exposed to it limits the spread and allows for more timely eradication
and management efforts. The proposed funding level for fiscal year
2012, which includes an increase of $8.85 million for a total of $14.15
million, more accurately reflects how much the program needs to carry
out essential activities and retain advances made to date.
APHIS faces a growing workload in the area of genetically
engineered (GE) plants. The requested increase for our Biotechnology
Regulatory Services (BRS) program, while significant, is needed to
implement improvements, expand our regulatory program for
biotechnology, and resolve the challenges currently faced by the
program.
The agency is responsible for enforcing the Animal Welfare Act
(AWA). APHIS' Animal Welfare program carries out activities designed to
ensure the humane care and treatment of animals. USDA's Office of
Inspector General (OIG) recently conducted a review of APHIS'
inspections for AWA compliance, specific to problematic dog dealers who
have committed repeat and serious violations. OIG concluded that APHIS
should shift its compliance efforts from an education focus to an
enforcement focus, improve inspection performance, and seek legislation
regarding the Internet sale of dogs. APHIS is responding to the audit
and needs additional resources to address the improvements noted in the
OIG audit.
The fiscal year 2012 budget also includes increases for programs
that target specific pests, such as the Asian long-horned beetle (ALB)
and the European grapevine moth (EGVM). The ALB program has eradicated
two ALB outbreaks (in Chicago, Illinois, and Hudson, New Jersey) and
has successful tools and strategies to attack this pest. The program is
now addressing a large outbreak near Worchester, Massachusetts, that
threatens New England's hardwood forests. With adequate resources, the
program can prevent ALB from spreading into the valuable forests and
ultimately eradicate it. APHIS is also addressing EGVM (detected in
fiscal year 2009) in California. With a strong early response, APHIS
and State and industry cooperators have greatly reduced EGVM
populations. Continued resources are necessary to ensure that the pest
is eliminated.
Questions. In the future, this subcommittee requests that this
segment of the budget (at least) be supported by a rigorous cost-
benefit analysis, to better focus the Department's plans and
strategies, and to equip this subcommittee with adequate tools to make
the most effective decisions.
Answer. We will make every effort to provide this information with
our budget request in the future.
genetically modified organisms
Question. GE or genetically modified organisms (GMOs) were in the
news again last week--specifically, GMO alfalfa and GMO sugar beets.
Obviously, there are a variety of concerns surrounding the
proliferation of genetically modified (GM) species.
What assurances can you provide that new GM crops will not result
in drift-related problems, contaminating nearby species?
Answer. Before a GE crop can be commercialized, APHIS thoroughly
evaluates it to ensure there is no plant-pest risk, thereby enhancing
public and international confidence in these products. Crops being
field tested must be grown under a permit or notification depending on
the type of crop and its potential risk. APHIS imposes confinement
measures for field trials of regulated GE organisms to safeguard
against the unintended release of GE materials into the environment and
also limit gene flow. Safeguards can include surveying for local wild
relatives; removing plant reproductive structures (detasseling);
cleaning equipment; and bagging flowers to contain pollen. APHIS also
conducts thorough inspections of field trials to ensure that
biotechnology organizations are adhering to APHIS regulations and
permit conditions. Once APHIS has made a determination of nonregulated
status, the GE organisms do not fall under APHIS regulatory purview and
can be moved and planted freely in the United States.
Question. Does this budget request, for instance for BRS, provide
sufficient resources for the Department to meet marketplace demands and
ensure public safety regarding GMOs?
Answer. The fiscal year 2012 budget request for the BRS program
includes an increase of $12,072,000 to, among other things, enhance
APHIS' compliance program and improve the petition process for
nonregulated status. Specifically, the increase will allow BRS to
inspect additional field test permit acreages, develop emergency
response plans for APHIS to rapidly respond to incidents involving
regulated GE organisms, enhance port of entry inspection procedures and
processes, increase the ability to respond to emerging technologies,
and fully implement the Biotechnology Quality Management System, a
voluntary program that helps participating biotechnology researchers
and companies develop sound management practices that enhance
compliance with regulatory requirements for field trials and movement
of regulated GE organisms. APHIS has also requested funding in the
fiscal year 2012 budget to begin a multiyear gene flow status and
trends monitoring program. This program will develop information about
the extent, scale, and measurement of gene flow in major agricultural
regions in the United States.
research
Question. Mr. Secretary, the budget proposes to decrease funding
for the two USDA research agencies, the Agricultural Research Service
and NIFA, by $180 million. In NIFA alone, nearly 20 programs are
eliminated.
I understand and appreciate the need to consolidate or eliminate
programs, especially in this budget environment. How did you determine
which programs to eliminate and which to protect? Are you trying to
steer people towards competitive funding?
Answer. The administration strongly believes that peer-reviewed
competitive programs that meet national needs are a more effective use
of taxpayer dollars than earmarks that are provided to specific
recipients. The fiscal year 2012 budget proposes to eliminate these
targeted earmarks. Within necessary budget constraints, it is critical
that taxpayer dollars be used for the highest quality projects, those
that are awarded based on a competitive peer-reviewed process to meet
national priorities. Therefore, some broad aspects of many research
topics currently addressed by earmarked projects can be included in the
scope of the Agriculture and Food Research Initiative (AFRI) program in
fiscal year 2012. Other topics will be addressed under other broader
based, competitively awarded Federal programs supported with non-
Federal funds administered by State-level scientific program managers.
agriculture and food research initiative
Question. In AFRI specifically, over the past few years, have you
received more qualified applications than you have been able to fund?
How do you coordinate with other Federal and State research agencies to
prevent duplication?
Answer. There are always more qualified applications for AFRI than
we are able to fund. In fiscal year 2009, the first year of the AFRI
program, NIFA received 2,424 applications, of which 835 ranked well
enough in the peer review process to qualify for funding. Funds were
available to support 470 of those applications. For fiscal year 2010,
funds are available to support the applications processed to date.
NIFA has increased discussions in recent years with agencies such
as NSF, the National Institutes of Health (NIH), and others to ensure
coordination and lack of duplication. NIFA is actively partnering with
these agencies to offer joint programs in areas of common interest,
creating greater visibility and impact for agricultural issues. For
example, NIFA has recently partnered with NIH to offer a program
entitled, ``Dual purpose with dual benefit: Research in biomedicine and
agriculture using agriculturally important domestic species.'' This
program allows NIFA to leverage its scarce dollars while engaging a
broader research community in work relevant to NIFA's mission.
research
Question. Is there concern about the long-term effects that occur
from stopping or significantly reducing agricultural research projects
mid-stream? Typically, do the researchers stay in agriculture research,
or do they move on to something else?
Answer. While the administration proposes to eliminate earmarks and
emphasize peer-reviewed competitive programs, we do expect earmark
projects funded in fiscal year 2010 to fully meet research goals and
objectives outlined in the proposals submitted to and approved by the
agency. The majority of these projects included multiyear funding that
would allow for the orderly completion of the specific research
outlined in these proposals. The agency has encouraged recipients of
earmarked projects to submit proposals to the competitive grant
programs of the agency. Researchers generally continue to stay in
agricultural research but may also look to alternative sources to
support their work.
settlements of discrimination cases
Question. Recently the Department announced settlement processes
for discrimination cases involving Hispanic and women farmers and
ranchers.
Please summarize the current status of the Pigford, Love, Garcia,
and Keepseagle cases.
Answer. On February 18, 2010, USDA worked with the Department of
Justice (DOJ) to enter into a settlement with Black farmers for $1.25
billion, known as Pigford II. And on December 8, 2010, President Obama
signed legislation that will provide $1.15 billion in funding for this
settlement beyond the $100 million provided for in the 2008 farm bill.
When this settlement receives final approval by a Federal court, we
look forward to bringing closure, once and for all, to the long-
standing litigation brought by Black farmers against USDA.
On October 19, 2010, USDA and DOJ announced the settlement of a
class action lawsuit filed against USDA by Native American farmers
(Keepseagle) alleging discrimination by USDA. The settlement, which
received preliminary approval by a Federal court, ends litigation
concerning discrimination complaints from Native Americans generally
covering the period 1981-1999. Under the settlement agreement, $680
million will be made available from the Judgment Fund to eligible class
members to compensate them for their discrimination claims, and tax
relief. An additional $80 million will be provided by USDA for the
forgiveness of existing farm loan program debt.
On February 25, 2011, USDA and DOJ announced a unified claims
process for Hispanic and women farmers and ranchers who allege
discrimination that occurred between 1981 and 2000. Under the plan, the
United States will make available at least $1.33 billion from the
Judgment Fund to eligible claimants to resolve their discrimination
claims. USDA will provide an additional $160 million in debt relief to
successful claimants with eligible farm loan program debt. USDA is
presently conducting outreach across the country regarding the claims
process and is in the process of procuring an independent administrator
and adjudicator to carry out the claims process. Once the administrator
and adjudicator are in place, the opening of the 180-day period for
filing claims will be announced.
Question. Are there other situations involving groups of aggrieved
applicants that remain unresolved?
Answer. On March 15, 2011, a group of Garcia plaintiffs filed a
complaint challenging the voluntary claims process. This complaint has
been referred to the judge presiding over Garcia and the Government
will argue for its swift dismissal. We are moving forward to fully
implement the Hispanic and Women Farmers and Ranchers Claims Process
and the new lawsuit has no impact on our outreach and preparation. USDA
is confident that the court will uphold the legality of the voluntary
claims process.
Question. What processes have you implemented to ensure equal
public access to all farm credit programs?
Answer. The Farm Service Agency (FSA) has more than 2,400 offices
located throughout the country. While not all of the offices have
credit officials permanently stationed in them, FSA employees are cross
trained to provide basic information on credit programs and arrange an
appointment with the credit official if needed. Each FSA office
delivering credit programs has developed a marketing/outreach plan to
ensure programs are marketed to all sectors of the served communities.
FSA credit forms have been streamlined to make the application process
less daunting. Currently FSA is working on a ``plain language guide to
FSA loans'' that when completed will provide for a layman's guide to
obtaining credit.
renewable energy
Question. REAP has been in existence, in some form, since the
fiscal year 2002 farm bill. Substantial mandatory and discretionary
funding has been spent on this program over the years. This budget
seeks to supplement the $70 million of mandatory funds available in
2012 with an additional $37 million of discretionary dollars.
Why is additional funding needed for this specific program?
Answer. The demand for REAP far exceeds the funds available in this
program. In 2010, more than 300 eligible applications did not receive
funding. This program encourages investment; and successful applicants
make tangible investments in more energy conservation, more renewable
energy production, and a more productive economy.
Question. In the past, the bulk of this funding was used for on-
farm activities such as grain dryers. Is this the best use of this
funding?
Answer. Through the interim rule the agency is limiting equipment
replacement to similar size or capacity equipment. The change is
designed to provide an equitable distribution among a range of
technologies and balance our portfolio without giving any project type
an undue advantage.
Question. Would utilizing these funds in alternative energy
programs be more effective in moving the United States toward energy
independence?
Answer. REAP is geared towards rural areas and small businesses.
Achieving energy independence is a goal that requires a comprehensive
effort and will involve every community in America, rural and urban.
Energy efficiency has played a major role in reducing our demand for
energy and most experts predict we will continue to do more with less
energy in the future. Providing the mechanisms for energy efficient
rural communities must be part of achieving energy independence. While
we aren't going to totally replace fossil fuels in the near term, we
need to rapidly grow our ability to use alternative advanced biofuel
and rural communities are on the frontlines of that effort. The
investment in REAP and other USDA Energy programs is a sound investment
with real dividends for America.
water and waste disposal program
Question. The second largest source of budget authority
expenditures in the USDA Office of Rural Development (RD) is the Water
and Waste Disposal program. Projects are typically funded through loan/
grant combinations, with the loan component averaging 65-70 percent of
the project cost.
Have you given thought to requiring communities to rely even more
heavily on loans?
Answer. RD Water and Waste Loan and Grant activities are
exclusively focused on rural water and waste infrastructure needs,
working with only rural areas with populations of 10,000 or less. Most
RD projects serve areas well less than a 10,000 population. Applicants
must demonstrate that they need Federal assistance because they cannot
obtain credit from commercial lenders or investors, and they have
urgent needs for water or wastewater improvements. While some
communities are able to take on additional loan debt, many of our
applicant communities are not. The average cost for water and waste
disposal service in rural America has increased as the cost of
construction, operation, and maintenance of water and waste disposal
systems has increased. The average cost per equivalent dwelling unit
was $43 per month for water service and $45 per month for waste
disposal service for the projects we funded in fiscal year 2010.
The program is a needs-based program, where loan and grant funds
are combined based on a strict underwriting process to keep rates
reasonable for rural residents. That underwriting process considers the
cost of the project, the current ability of a community to take on
additional debt, and the level of reserves that are needed for
replacement of short-lived assets (i.e., motors, pumps, etc.), as well
as other factors necessary to ensure that the project is feasible.
In fiscal year 2010, RD obligated 1,052 loans of which 315 (30
percent) were cases where the loan component was greater than 70
percent of the funding provided.
Question. Can this be done such that grant funding is conserved for
the most remote and low-income rural communities?
Answer. Grant funding is currently conserved for the communities
with the greatest financial need. We continue to implement our funds
through an underwriting process that determines the loan and grant mix
needed to fund the project. Grant levels are subject to the
availability of funds and we are not always able to provide the level
of grant funding a community has requested. Therefore, we encourage and
often facilitate the partnering of our funding with that of other
Federal, State, and local programs to keep the user rates as reasonable
as possible.
housing
Question. This budget announces a fee change in administration
policy regarding rural housing support. Many long-standing rural
housing programs are eliminated, and the flagship Single-Family Housing
Direct Loan program is slashed. The following housing programs are
eliminated:
--Very Low-Income Housing Repair Loans;
--Multifamily Housing Guaranteed Loans;
--Credit Sales of Acquired Property;
--Self-Help Land Development Loans;
--Mutual and Self-Help Housing Grants;
--Housing Preservation Grants; and
--the Multifamily Housing Revitalization and Preservation Program.
--And the Single-Family Housing Direct Loan Program is reduced from
an historic annual level of $1.1 billion to $211 million. This
loan program, for very low- and low-income rural households,
will fund fewer than 1,700 houses nationwide.
What is your vision of the future role the Federal Government will
play regarding providing support for rural housing?
Answer. Housing is a vital economic pillar in rural America for
creating wealth for communities and homeowners. USDA realizes that
rural populations tend to be more economically challenged with lower
incomes and fewer housing choices than their suburban and urban
counterparts, and therefore we continue to offer a no-down payment
homeownership program through both the Single-Family Housing Guaranteed
and Direct programs. Providing credit in areas that lack private
investment is a critical function of USDA RD. To address the need for
credit--particularly in the rural housing market--RD has dramatically
increased the Single-Family Housing Guaranteed Loan Program in recent
years, doubling the Government's investment from $12 billion in 2010 to
$24 billion in 2011. A fee structure that is consistent with other
Federal housing agencies has eliminated the requirements for additional
budget authority.
Question. What evidence do you have that private housing credit
markets have recovered sufficiently to meet credit needs in rural
America?
Answer. RD's section 502 guaranteed loans have taken on a greatly
increased role in providing adequate housing credit in rural America.
The program increased from 31,000 guarantees for $3 million in fiscal
year 2006 to 133,000 guarantees totaling nearly $12 billion in fiscal
year 2010. The market has clearly demonstrated a need for USDA's home
loan program as lenders have increased activity in rural areas. We
expect this growth to continue.
The private housing credit markets have never fully met the needs
in rural America. These credit markets have changed, with RD stepping
in to play a crucial role to help assure adequate credit will be
available to rural Americans and stabilize mortgage availability. The
situation would be worse without the USDA program.
The private housing credit markets for affordable rental loans
guaranteed through the section 538 program have not changed the past
several years. RD has maintained its relationship with the Government
National Mortgage Association (Ginnie Mae) to secure loans guaranteed
under the section 538 program. Through this relationship the vast
majority of the loans guaranteed under the section 538 program prior to
the credit crisis and after the crisis have been purchased by private
investors as pooled loans in Ginnie Mae securities.
Question. Does it make sense to have a nationwide housing loan
program that serves fewer than 1,700 families?
Answer. The Single-Family Housing Direct Loan Program provides
subsidized mortgages to low- and very low-income families, who cannot
obtain credit elsewhere, so that they can own modest, decent, safe, and
sanitary homes in rural areas. In some instances, qualified borrowers
can reduce the interest rate to 1 percent. The fiscal year 2012 budget
provides funding to support the needs of rural America's neediest
homeowners. The funds are targeted to very low-income borrowers who
would not be eligible for private-sector financing. The Direct Loan
program enables these borrowers the opportunity to purchase a home.
While it's true that the Single-Family Housing Guaranteed Loan
Program performance from 2010 shows that 30 percent (more than 40,000)
of the loans were to low-income home buyers, there will always be a
segment of the population that will not qualify for the guaranteed
program because of the need to qualify for private-sector credit. It is
USDA's intent to meet that need, however large or small, to the extent
possible given our budget constraints.
Question. In the face of eliminating the multifamily revitalization
program, how does USDA plan to protect the Government's interest in its
large multifamily housing portfolio?
Answer. The USDA plans to protect the Government's interest in its
large multifamily housing portfolio through a proposed budget increase
in the Section 515 Direct Rural Rental Housing Program for fiscal year
2012. Traditionally, the way to fund revitalization has been though the
section 515 program with rehabilitation loans. The fiscal year 2012
budget proposes to increase the section 515 program from $69.5 million
to $95 million.
Question. For years USDA has cultivated the expansion of Self-Help
Housing grantee organizations across the country. What assistance can
the Department provide to these organizations now that you are
eliminating grant funding?
Answer. USDA intends to continue a partnership in the immediate
future with the Self-Help Housing Technical and Management Assistance
(T&MA) contractors to provide guidance to Self-Help Housing grantees.
As we transition out of a program that we recognize has made major
contributions to rural housing, we will no longer have the ability to
fund the administrative costs associated with Self-Help Housing due to
budget constraints. Together with the grantees and T&MA contractors,
USDA will identify other means for grantees to garner fees for their
services and address regulations that will accommodate new ideas.
rental assistance
Question. Please describe in detail the forecasting methodology
used to develop contract renewal estimates (number of contracts and
costs) for the President's budget.
Answer. In 2004, the RD Program Office and Chief Information Office
developed a rental assistance forecasting tool that incorporated the
Office of Management and Budget's (OMB's) inflation rate to forecast
the exhaustion of funds from all the rental assistance contracts. The
forecasting methodology reviews actual rental assistance usage over the
last 3 years, develops an average usage rate, and applies the inflation
factor to determine the amount needed in the contract based on the
number of units with rental assistance. The methodology was reviewed by
the Government Accountability Office (GAO), which provided comments on
the inflation adjustment that were incorporated in the tool in 2005.
Question. How do you determine inflation factors for utility
increases, etc.?
Answer. Inflation factors are determined within the forecasting
tool using the OMB inflation rate.
Question. Is the same methodology used for section 515 and farm
labor housing?
Answer. The same methodology is used for section 515 and farm labor
housing.
Question. Has this methodology been reviewed by either OIG or GAO?
Answer. This methodology was reviewed by GAO in 2005.
Question. If so, what were their comments and what changes were
implemented based on those comments?
Answer. GAO suggested a change in the inflation adjustment to add
the inflation factor one time, rather than for each year in a contract.
The change was incorporated.
Question. Please provide, by year since 2008, the total President's
budget request, including the number of contracts and average costs.
Answer. [The information follows:]
----------------------------------------------------------------------------------------------------------------
Amount
Fiscal year Budget request Appropriation No. of units obligated Average per
(millions) (millions) under contract (millions) year
----------------------------------------------------------------------------------------------------------------
2008............................ $567 $478.7 121,568 $478.7 $3,937
2009............................ 997 997.0 210,618 902.5 4,285
2010............................ 897 980.0 219,231 980.0 4,470
2011............................ 966 980.0 211,111 252.8 4,340
2012............................ 906 .............. 204,500 .............. ..............
----------------------------------------------------------------------------------------------------------------
Question. Also provide the appropriated amount, the number of
contracts actually funded and the average cost.
Answer. [The information follows:]
----------------------------------------------------------------------------------------------------------------
Budget request Appropriation No. of units Amount obligated Average per
Fiscal year (millions) (millions) under contract (millions) year
----------------------------------------------------------------------------------------------------------------
2008........................ $567 $478.7 121,568 $478.7 $3,937
2009........................ 997 997.0 210,618 902.5 4,285
2010........................ 897 980.0 219,231 980.0 4,470
2011 continuing resolution.. 965 980.0 58,237 252.8 4,340
----------------------------------------------------------------------------------------------------------------
Question. For each year since 2008 please provide the average
actual duration of contracts funded.
Answer. Starting in fiscal year 2008, Rental Assistance contracts
were funded for a 1-year period. In fiscal year 2009, of the contracts
funded in fiscal year 2008, approximately 9.5 percent of the contracts
exhausted funds prior to the end of the 1-year period. In fiscal year
2010, of the contracts funded in fiscal year 2009, approximately 3
percent of the contracts exhausted funds prior to the end of the 1-year
period.
Question. Please describe how RD controls the escalation of rental
assistance costs.
Answer. The Housing Act of 1949 requires that borrowers under
Section 515 Rural Rental Housing and Section 514 Farm Labor Housing
programs submit a budget annually to demonstrate the costs associated
with operating rental housing. This includes requests for rent
increases, which must be justified by the borrower. Since rental
assistance provides some of the operating income to support operations,
the Rural Housing Service (RHS) field staff work closely with borrowers
and management agents in reviewing the budget and determining
appropriate costs.
multifamily revitalization initiative
Question. Please describe in detail all of the tools available in
the Multifamily Housing Revitalization Initiative toolbox, and how RD
utilizes this mix of options to sustain affordable housing in rural
areas.
Answer. The Multifamily Housing Revitalization Demonstration
Program uses four tools to financially restructure these affordable
rural rental properties. These tools are a modification of the existing
section 515 loan, a zero-interest rate section 515 loan, a soft second
section 515 loan (a second loan that has its interest and principal
deferred to a balloon payment) and a revitalization grant. In addition,
there are two other programs which, although not technically
revitalization, are funded from the same account. They are the
Preservation Revolving Loan Fund and RD vouchers. The properties are
reviewed and underwritten to determine the property's financial needs,
after which a combination of tools are used to ensure the property is
financially sound and remains in the affordable housing portfolio for
many years. In addition to these section 515 revitalization tools,
direct loans are available to support revitalization activities of the
portfolio as well. The section 538 loan guarantee has also been used in
the past to address immediate capital repair needs; however, funding
for section 538 is not requested in the fiscal year 2012 budget. Many
revitalization projects also use third-party funding, such as low-
income housing tax credits, as additional leverage for revitalization
of section 515 properties.
Question. By year, for the life of the initiative, please provide
the President' budget request, the appropriated amounts, and how those
funds were used.
Answer. [The information follows:]
[Dollars in millions]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Budget
request Appropriated Number of Soft second Zero-percent Preservation
Fiscal year (budget (budget deals loans Grants Deferrals section 515 revolving Vouchers
authority) authority) loan loan fund
--------------------------------------------------------------------------------------------------------------------------------------------------------
2006......................... $214.00 $18.976 76 $4.5 $0.2 $48 $0.280 $6.415 $0.620
2007......................... 74.25 18.853 87 2.8 0.5 56 2.561 9.151 3.000
2008......................... 27.80 27.804 135 13.0 0.4 100 12.649 13.793 6.205
2009......................... ............ 27.714 94 5.3 0.2 50 15.021 15.398 6.751
2010......................... 26.62 43.191 142 21.5 0.3 117 5.057 20.897 7.595
2011......................... 18.00 43.191 8 3.7 ........... ......... 0.391 7.061 4.557
--------------------------------------------------------------------------------------------------------------------------
Total.................. 342.67 179.730 536 50.8 1.6 371 51.030 80.820 28.730
--------------------------------------------------------------------------------------------------------------------------------------------------------
Question. For vouchers specifically, please provide by year the
President's budget request, the amount appropriated, the number and
amount of vouchers offered (distinguishing between new and renewals),
the number and amount of vouchers accepted (also distinguishing between
new and renewals), and how surplus voucher funding was utilized.
Answer. [The information follows:]
RURAL DEVELOPMENT VOUCHER PROGRAM
[Dollars in millions]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Vouchers issued
Fiscal year President's Appropriated Dollars -----------------------------------------------
budget obligated New Renewals Total issued
--------------------------------------------------------------------------------------------------------------------------------------------------------
2006.................................................... .............. $16,000,000 $620,000 211 .............. 211
2007.................................................... $74,250,000 15,840,000 3,000,000 1,098 .............. 1,098
2008.................................................... 27,800,000 4,965,000 6,205,375 1,013 1,088 2,101
2009 \1\................................................ .............. 4,965,000 6,751,534 811 1,251 2,062
2010.................................................... 4,965,000 16,400,000 7,595,644 764 1,481 2,245
2011 \2\................................................ 18,000,000 16,400,000 3,610,843 563 577 1,140
-----------------------------------------------------------------------------------------------
Total............................................. .............. .............. 24,783,396 4,460 4,397 8,857
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Indicates the President's budget did not request funds for this program and proposed a $20 million rescission from carryover balances.
\2\ Fiscal year 2011 obligations are as of March 31, 2011.
Carryover funding that was not used for vouchers in the
appropriated fiscal year was used to fund the Multifamily Preservation
and Revitalization Program, for voucher administration contracting
payments, and for information technology upgrades.
Question. What percentage of voucher recipients move from their
original place of residence?
Answer. RHS experience in the program as of October 2010 is that
12.6 percent of the former section 515 tenants receiving vouchers move
from their original apartment after the property leaves the section 515
program.
Question. Please describe the information systems RD utilizes to
manage the voucher initiative. What socioeconomic data do you collect
on voucher recipients?
Answer. USDA maintains a database system on all tenants in section
515 and section 514 housing developments. As a borrower prepays the
section 514 or 515 mortgage, or a foreclose action occurs, tenant
information is used to advise tenants of the availability of the
voucher program. Once a tenant chooses to accept a voucher, USDA
utilizes the services of a contractor, who has developed a Workflow
Management System that houses landlord and voucher holder information.
In addition, RHS is currently in the process of replacing and upgrading
its current accounting database, which will manage the voucher
certification and payment processes.
The agency collects demographic and income data on voucher holders
at the time of issuance of the voucher. The tenant characteristics are
captured in the Multifamily Information Systems database.
Question. Are vouchers always renewed for the same amount or have
you instituted procedures whereby voucher amounts can be increased?
Answer. Generally, vouchers are renewed for the same amount. There
are exceptions where the original amount of the voucher may have been
reduced from the maximum amount available because the voucher amount
exceeded the amount of the voucher holder's rent. If the voucher holder
moves to another apartment where the rent is higher, the voucher amount
is adjusted upward, not to exceed the maximum amount available. USDA
has not instituted a cost of living or annual adjustment increase.
microenterprise program
Question. What is the status of implementation of the
Microenterprise Program?
Answer. Rural Development, Rural Business-Cooperative Service
published a final rule in June 2010 and began funding loans and grants
during the fourth quarter of fiscal year 2010. Additionally, on July
19, 2010, the agency published a technical correction to the interim
rule (1 CFR, park 4280, subpart D).
Question. Is this program showing success as you expected?
Answer. Yes, in fiscal year 2010, the Rural Business-Cooperative
Service funded 63 direct loans in the amount of $24,982,500, 62
automatic technical assistance grants in the amount of $5,356,349, and
12 technical assistance only grants in the amount of $1,289,500. It is
anticipated that the intermediary will revolve the Rural
Microentreprenuer Assistance Program loan funds twice in the 20-year
term; and each ultimate recipient loan will assist one business and
save a minimum of one job. Each loan to an ultimate recipient is
expected to average $15,000 to $20,000. This equates to an estimated
minimum 40 businesses assisted and 40 jobs created/saved per $100,000
of Loan Budget Authority.
Question. At this stage of implementation, isn't it premature to
request additional discretionary funding to supplement the mandatory
funding that is available?
Answer. The program has already experienced success based on the
overwhelming interest in the program, as a result of the 2010 Notice of
Funds Availability (NOFA). The majority of available discretionary and
mandatory funding has been provided during the first round of
solicitation in 2010. To date, $34.9 million has been awarded to 82
microlenders in 38 States.
The reduced level of funding included in 2011 will be fully
utilized when the 2011 NOFA is published. Already, there are 60
applicants requesting $17.1 million in programmatic funds in the
funding cue. This compares to the approximate $16 million program level
provided for 2011. If the Congress determines that additional
discretionary funds are needed, it would meet the demand of rural small
businesses.
Question. How are you measuring success?
Answer. We measure success of our programs by the number of jobs
created/saved, businesses assisted, geographic distribution, and
addressing communities with the greatest need.
agricultural exports
Question. The budget request includes an increase of $20 million
for the National Export Initiative (NEI). According to USDA,
agricultural exports are forecast to hit a record of $135 billion, this
is $9 billion more from the November forecast and higher than the
previous record set in 2008.
Given the current budget atmosphere and ever shrinking resources,
please explain why you believe this request is justified at this time.
Answer. The $20 million request for NEI in fiscal year 2012
supports additional activities and staff positions that are necessary
to reach the President's goal of doubling U.S. exports by the end of
2014. The Foreign Agricultural Service (FAS) will use these funds to
enhance our activities in defending market access as well as expanding
market access for U.S. agricultural products. Competitive opportunities
around the globe are rapidly changing, as more and more countries enter
into trade agreements and preferential arrangements. Although U.S.
agricultural exports are currently strong and increasing, these
changing international relationships will pose ever-increasing
challenges to U.S. export competitiveness. We must also help educate
more agricultural businesses on the benefits of exporting and provide
technical assistance on reaching foreign customers.
To expand FAS export assistance efforts, $18 million will be used
to provide technical assistance and trade facilitation, both in the
United States and in overseas markets, in order to strengthen the
ability of U.S. producers and related agribusinesses to increase
exports to a wider range of foreign markets. Domestic outreach efforts
will include a special outreach to educate and support small- and
medium-sized enterprises, which are a key focus of NEI. The remaining
$2 million will be used to bolster FAS's trade monitoring and
enforcement efforts. This work will focus on key countries such as
China, the European Union, Indonesia, Canada, Mexico, Japan, as well as
on prospective Free Trade Agreement partners such as South Korea,
Colombia, and Panama. With continued growth in exports come new and
more complex opportunities for trade barriers and irritants, especially
on sanitary and phytosanitary issues, and other technical issues. The
additional resources will enable FAS to better support U.S. challenges
to foreign actions that harm U.S. agricultural interests, as well as
support U.S. defenses against trade cases brought against us, such as
under the World Trade Organization.
humanitarian food assistance
Question. News events daily remind us of a chaotic world where
chronic and acute hunger threatens the lives of millions of people. As
we have seen over the past few months, rising food prices around the
world have caused instability in some of the most vulnerable places.
Your budget includes level funding for Public Law 480 title II grants,
which often provides the only meal a person will have during the day.
Given the current worldwide economic situation, do you believe your
request is sufficient to meet the ever increasing demand for food
assistance?
Answer. Although USDA is not responsible for administering the
title II program, we understand the importance of food aid programs and
appreciate the Congress' support in our efforts to alleviate hunger.
Rising food prices do have an impact on hunger and certainly lead to
political and economic instability worldwide.
Given competing priorities and current deficit-reduction
strategies, we believe that amounts requested for fiscal year 2012 are
sufficient. If unanticipated emergencies arise, the Bill Emerson
Humanitarian Trust is available to supplement title II resources.
farm bill cuts
Question. The farm bill provides mandatory spending for a number of
programs. Over the last several budget cycles the administration has
proposed to limit several of these programs.
Can you discuss why the administration believes these limitations
are needed and how you decide which programs to target?
Answer. The President believes that if we are to promote economic
recovery, invest in our long-term competitiveness, and create
opportunities for all Americans a comprehensive, balanced deficit
reduction framework must be part of that strategy. The President's
vision of ``shared sacrifice'' requires that mandatory programs be
included in the comprehensive deficit reduction framework. There are a
number of factors that have influenced which mandatory programs have
thus far been targeted for reductions in the President's annual budget
requests as well has how those reduction have been proposed. For
example, President Obama made a campaign promise to eliminate farm
program payments to wealthy individuals. Accordingly, since taking
office, the President's budget requests have consistently proposed
reductions to mandatory farm programs to eliminate payments to wealthy
individuals and better target the farm safety-net payments to
individuals who need the assistance. These proposals have provided
budgetary savings consistent with the President's campaign promises
while preserving the basic structure of the farm safety-net programs so
that the future of the farm program policies can be debated in the
context of the next farm bill.
the special supplemental nutrition program for women, infants, and
children
Question. Mr. Secretary, the budget request includes an increase of
$138 million for the Special Supplemental Nutrition Program for Women,
Infants, and Children (WIC). According to the Economic Research
Service, food prices are expected to increase 3-4 percent this year.
Often times, when we see food prices rise, we also see a corresponding
rise in WIC participation levels. Food becomes more expensive and so
more people need assistance.
In light of food price increases, do you believe your request of
$7.4 billion is sufficient to cover the demand for this program?
Answer. The amount requested for WIC in the President's budget was
based on estimates for the program derived from the most current data
available at that time. However, the Food and Nutrition Service (FNS)
recognizes that circumstances can change, and we constantly monitor
food costs and participation in the program.
Question. The budget does not include new monies for the
contingency fund. What is the current availability in the contingency
fund? Given the current economic situation, do you envision the need
for the contingency fund?
Answer. FNS constantly monitors program performance in WIC,
including participation trends and food costs, and would consider
seeking apportionment of the $125 million in WIC contingency funds if
needed to support participation because program costs are unexpectedly
higher than anticipated.
public health information system
Question. For fiscal year 2012, the budget proposes to decrease
funding for the Food Safety and Inspection Service (FSIS) overall
slightly, but includes significant increases for the Public Health
Information System (PHIS), which will help FSIS track information in a
more streamlined, real-time manner.
Can you discuss how the testing of PHIS went and what benefits you
expect it to provide when fully implemented.
Answer. FSIS conducted multiple rounds of user acceptance testing
with field personnel as well as several extensive dry-run training
sessions with District Office representatives from around the country
in order to make PHIS the best possible tool for FSIS personnel. They
provided critical feedback that was utilized to refine the system for
implementation and finalize clear and concise training for inspection
program personnel.
The goal of the PHIS is to improve the agency's ability to collect,
analyze, and communicate data to protect public health. The system will
integrate FSIS' data sources to support a comprehensive, timely, and
reliable data-driven approach to FSIS inspection, auditing and
scheduling. This system will be flexible, user-friendly, and Web-based.
It refines and replaces many of FSIS' stove-piped legacy systems (e.g.,
Performance-Based Inspection System (PBIS)), automates paper-based
business processes (e.g., export certification), and can accommodate
changing needs.
PHIS will better identify food safety risks to help prevent
outbreaks or recalls. Using multiple FSIS data sources, analysts will
be able to identify trends and anomalies, including the relationship
between pathogen test results and inspection findings.
Using PHIS' predictive analytics component, the agency will be able
to monitor establishment data in near real time and have built-in
alerts for anomalies such as a large number of incomplete inspection
activities or high rates of noncompliance in an establishment.
PHIS will also streamline the agency's export program by automating
paper-based processes, including establishment applications for
approval for export, applications for export certificates, and the
issuance of export certificates. The system will enable automatic edit-
checks to ensure that certificates properly reflect a foreign country's
import requirements.
Finally, the system will allow for faster and more effective
communication between FSIS personnel at headquarters and the more than
8,000 FSIS personnel protecting public health nationwide in
approximately 6,200 federally inspected establishments and elsewhere on
the front lines. It will also allow for improved collaboration with
stakeholders and Federal, State, and local public health partners to
improve contaminant tracing and prevent foodborne illness outbreaks.
Question. What will the effects be if the Congress is unable to
provide the level of funding you are requesting for PHIS?
Answer. The agency will seek to manage the effects in such a way as
to minimize the impact on PHIS. FSIS considers PHIS a critical food
safety regulatory tool for inspection program personnel.
The goal of the PHIS is to better protect public health by
improving the agency's ability to collect, analyze, and communicate
data. The system will integrate FSIS' data sources to support a
comprehensive, timely, and reliable data-driven approach to FSIS
inspection, auditing, and scheduling. Through improved data quality,
more consistent reporting, enhanced management controls, and efficient,
effective use of FSIS data, PHIS will enable FSIS to respond more
quickly to threats. Integration and analysis of the data will also help
us to predict negative public health outcomes and pinpoint
vulnerabilities so that FSIS can rapidly respond to the hazards at all
points and prevent problems. The system will also allow FSIS to
coordinate effectively within FSIS and with stakeholders and other
agencies, improving investigations and contaminant tracing.
______
Questions Submitted by Senator Tom Harkin
food safety and inspection service
Question. For fiscal year 2011, the administration requested an $18
million increase more than fiscal year 2010 levels for the Food Safety
and Inspection Service (FSIS) to support initiatives to improve public
health infrastructure, speed up investigations and response to
outbreaks, conduct a baseline study on the prevalence of pathogens, and
expand sampling. Rather than this increase, FSIS would suffer an $88
million cut over the remainder of the year if H.R. 1, passed by the
House of Representatives becomes law.
Please describe any progress you were able to make on the
initiatives described in the fiscal year 2011 budget and describe how
the fiscal year 2012 budget builds on that. If no progress was made,
did we in fact lose a year of progress on improving public health?
Answer. In addition to inspection, verification, enforcement, and
other activities directly related to FSIS' food safety mission, during
fiscal year 2011, FSIS has continued to develop its Public Health
Information System (PHIS). The agency conducted multiple rounds of user
acceptance testing with field personnel as well as several extensive
dry-run training sessions with District Office representatives from
around the country, who provided critical feedback that was used to
make PHIS the best possible tool for employees. FSIS refined the system
based on this feedback; began training inspection program personnel on
March 14; and plans to launch the system on a staggered basis, as
employees are trained, in April 2011. FSIS will continue implementation
and enhancement of PHIS into fiscal year 2012.
During fiscal year 2011, FSIS has also implemented policy
initiatives, such as revised salmonella performance standards and new
campylobacter performance standards aimed at reducing the prevalence of
these pathogens in young chickens and turkeys. However, FSIS did not
fund these initiatives as they were proposed in the President's fiscal
year 2011 budget, since FSIS is operating with an annualized fiscal
year 2011 continuing resolution funding.
Question. What impacts would the proposed $88 million cut have on
food safety programs, and how would those impacts be addressed in
fiscal year 2012--even assuming the Congress provides at least the full
FSIS budget request for fiscal year 2012?
Answer. Under the proposed plan to mitigate an $88 million
reduction, the agency would seek to manage the effects in such a way as
to minimize the impact on the agency's regulatory responsibilities, on
industry, and ultimately the consumer.
If FSIS funding for fiscal year 2011 were reduced further, we would
have to review our options for achieving efficiencies for fiscal year
2011 and fiscal year 2012. I would point out, however, that 85 percent
of the FSIS budget is for personnel; therefore, a reduction of this
magnitude would likely have an effect on the FSIS workforce.
Question. Can you describe what is new in the food safety
initiatives proposed for fiscal year 2012 and what is a carryover from
last year's request?
Answer. For fiscal year 2012, the FSIS request totals
$1,011,393,000, a net decrease of $7,127,000 (0.7 percent) compared
with the annualized fiscal year 2011 continuing resolution amount of
$1,018,520,000.
The fiscal year 2012 budget for FSIS includes the following
increases for food safety initiatives:
--$16.6 million to continue the deployment and enhancement of the
FSIS public health information infrastructure, including $13
million to allow for the purchase of critical equipment and
improvement of information gathering systems to enhance access
of inspection personnel to centralized, mission-critical
systems (fiscal year 2011 request); and $3.6 million to pay for
staffing requirements associated with the implementation of
PHIS (fiscal year 2012 request).
--$700,000 to support regulatory testing for strains of non-O157
Shiga-toxin producing E. coli, motivated by increasing
awareness that these strains are causing human illnesses
(fiscal year 2012 request);
--$5.5 million to expand regulatory sampling for key pathogens and
conduct an additional baseline study. Expanded sampling will
help FSIS better estimate food safety risks and focus its
resources most effectively and efficiently (fiscal year 2011
request);
--$4.3 million for strengthening the Public Health Epidemiology
Program, which will support the agency in responding more
quickly to the current public health needs, including rising
frequency of multijurisdictional foodborne illness
investigations (fiscal year 2011 request).
Increases in the fiscal year 2012 budget request for FSIS are
partially offset by reductions in funding for:
--The Catfish Inspection Program, given the investment to date and
the need for considerable stakeholder engagement and regulatory
development before adoption and implementation of the program
(-$15.3 million) (combined fiscal years 2011-2012 request);
--Cooperative agreements with the 25 State and local partner
laboratories in the Food Emergency Response Network (FERN). In
conjunction with the capabilities of the FSIS laboratories,
this funding will maintain surge capacity throughout the FERN
laboratory system should a terrorist attack on the food supply
involving meat, poultry, or egg products take place (-$4.1
million) (fiscal year 2011 request); and
--FSIS laboratory capacity-building. Since fiscal year 2002, FSIS has
worked to improve the overall security and capacity of its
three regulatory sampling laboratories. We have completed the
capacity-building phase of these efforts and have begun the
maintenance and operational phases, which require considerably
fewer resources (-$5.6 million) (fiscal year 2011 request).
In addition, FSIS will achieve significant savings by streamlining
agency operations (-$4.5 million); achieving broadband efficiencies
(-$3.5 million) and laboratory sampling efficiencies (-$1 million); and
reducing laboratory sample shipping costs ($400,000) (fiscal year 2012
requests).
Question. The inspector general for the U.S. Department of
Agriculture (USDA) found that the current sampling program lacks a
statistical precision that is reasonable for assuring food is safe.
Would you describe how the program in your budget for fiscal year 2012
addresses the concerns raised by the inspector general?
Answer. FSIS agrees that a strong sampling program is an important
part of inspection activities performed by the agency. We believe that
to ensure food safety, FSIS must verify that establishments have
identified hazards likely to occur and have put in place processes to
minimize or eliminate those hazards. Verification includes a variety of
inspection activities, of which sampling is just one example.
The focus of the Office of Inspector General (OIG) report is the
sampling method that FSIS uses to test for E. coli O157:H7 in beef
products. Overall, our current beef sampling strategy appears to be
working, because ground beef is no longer the leading source of
foodborne-based E. coli illnesses.
Still, the agency is continually considering new approaches to
further reduce the incidence of E. coli O157:H7, testing being one of
our many strategies. Testing alone will not ensure the safety of
products in the marketplace. Food safety is achieved by ensuring that
the appropriate safeguards are in place at every step along the
process.
That is why the agency is working to ensure that our sampling
programs have the greatest possible impact on public health. We want to
explore what improvements can be made in our sampling programs, and the
OIG report will inform and help drive our efforts.
As referenced in the report, FSIS will develop a plan for
prioritizing and performing E. coli O157:H7 baseline studies of beef to
improve our verification systems, and will develop new verification
tasks for inspection program personnel to perform as part of their
hazard analysis verification and their verification of sanitary
dressing.
Question. The fiscal year 2012 budget request estimates savings of
$34 million from restructuring, eliminating positions, and introducing
efficiencies. If FSIS inspection is inadequate, we risk massive
recalls, plant closures, and of course, heightened food safety risks to
consumers.
Please describe what safeguards would be in place with respect to
the proposed savings to ensure that they don't result in inspection
failures with serious adverse consequences?
Answer. The proposed $34 million in savings for fiscal year 2012
from restructuring, eliminating positions, and introducing efficiencies
will not affect our front line inspection workforce. For example, FSIS
has identified 37 full-time equivalent positions that can be eliminated
by refraining from backfilling open positions resulting from attrition,
restructuring functional areas to streamline operations, and
consolidating staff and resources to eliminate redundant positions,
saving the agency an estimated $4.5 million. However, none of these
positions are in the field.
The agency does not anticipate a change in its regulatory
requirements and activities, and would seek to minimize any effect on
the enforcement of its regulatory responsibilities. For example, FSIS
inspection program personnel will continue to be present at all times
for slaughter operations and once-per-shift per day for processing
operations. In addition, FSIS personnel will continue to perform humane
handling verification and enforcement activities at all slaughter
plants.
school food safety
Question. The Healthy, Hunger Free Kids Act sets some new
requirements for USDA to improve food safety in America's schools.
Specifically, the bill requires you to improve the communication and
effectiveness of communication from the Federal level to the States
about food safety holds and recalls.
How do you intend to improve that communication? Have you
considered a Rapid Alert System similar to the one used in Europe,
which uses technology to ensure rapid dissemination of critical
information?
Answer. The Food and Nutrition Service (FNS) currently uses a Rapid
Alert System to communicate with State agencies about food safety
recalls that affect USDA foods. The Rapid Alert System uses telephone,
email, text message/SMS, and fax to repeatedly contact the State recall
coordinators until they acknowledge receiving the message.
USDA has conducted an evaluation of the needs of State agencies
during food emergencies such as recalls, and is setting criteria and
exploring means to improve their capabilities. The President's fiscal
year 2012 budget request proposes $1.75 million to fund State
information technology enhancements to assist State agencies in
fulfilling their responsibility to quickly identify and inform
recipient agencies that receive recalled product. These enhancements
would provide for improved communication with recipient agencies about
recalled foods; enable Web-based information posting; and include both
a rapid alert notification system and a self-registration notification
service. Currently, FNS communicates with State agencies through the
Electronic Commodity Ordering System (ECOS), but a similar system
reaching from State agencies to local school districts and schools is
not widely available. Provided funds are available, phase two of this
initiative would enable the same rapid communication between State
agencies and recipient agencies.
Question. Are you considering reorganizing responsibility within
the Department for oversight of food safety in schools, which is now
shared among FSIS, the Agricultural Marketing Service (AMS), and FNS, I
understand?
Answer. No, at this time the Department has no plans to reorganize
the oversight of food safety activities within schools.
Ensuring safe food for our school children is a collaborative
effort among a number of USDA agencies which have unique authorities
that span the farm to table food safety continuum, from inspecting the
product when it is produced, to setting procurement standards, managing
the distribution of the product to schools, and inspecting the school
cafeterias in which the product is served.
In February 2010, Secretary Vilsack announced several new
initiatives to assure the safety and quality of food purchased by USDA
for the National School Lunch Program and these initiatives have moved
forward. For example, in July 2010, after a detailed, ongoing review by
USDA's FSIS and the Agricultural Research Service (ARS), AMS finalized
tougher new standards for ground beef purchased for Federal food and
nutrition assistance programs including the National School Lunch
Program. The new standards guaranteed that USDA purchase standards meet
or exceed major private-sector buyers of ground beef.
In addition, USDA has increased its information sharing between
agencies to better monitor vendor performance and identify potential
food safety issues in the process. For example, information on FSIS in-
plant enforcement actions, positive pathogen test results, and recall
notifications are being shared directly with AMS.
Also, as Secretary Vilsack had requested, the National Academy of
Sciences completed a review of the testing procedures and requirements
of USDA purchased ground beef for the National School Lunch Program.
The review confirmed America's school children are receiving a safe
ground beef supply.
Collectively, these changes and ongoing scientific reviews of AMS
commodity procurement specifications is ensuring, and will continue to
ensure, that the food USDA distributes to school children and others
meets the highest quality and safety standards.
dairy policy reform proposals
Question. There is a significant amount of work being done to
develop proposals for modifying and reforming Federal dairy policy. The
Congress will consider a number of important considerations relating to
the ramifications of any changes to Federal dairy policy. In addition
to the key objective of enhancing income protection and prospects for
dairy farmers, the Congress will also be examining expected impacts of
policy on milk and dairy product markets and prices, consumer prices,
and costs to the Federal budget both for the dairy programs and for
nutrition programs such as the Special Supplemental Nutrition Program
for Women, Infants, and Children.
Will you ensure that USDA includes all of these considerations and
potential impacts in its analysis and review of proposals for dairy
policy reform and that the Department completes and provides to the
Congress such review and analysis in time for it to be available to the
Congress in its examination of legislative options for dairy policy
reform?
Answer. The USDA looks forward to working with the Congress in
evaluating proposals for dairy policy reform. We will strive to provide
comprehensive information on the impacts of significant reform
proposals in a timely manner.
______
Questions Submitted by Senator Dianne Feinstein
dairy
Question. Years 2009 and 2010 were catastrophic for our Nation's
dairy farmers. Over supply and chronically low prices led to an
unprecedented loss of farm equity and the closure of more than 4,500
dairies nationwide. In response, the U.S. Department of Agriculture
(USDA) spent more than $1 billion on dairy support programs and the
Congress appropriated an additional $350 million to help farmers
weather the hard times. These private-sector losses and public-sector
expenditures were untenable, and the lesson was clear: Federal dairy
programs must be reformed.
What is the Department doing to facilitate meaningful reforms in
the dairy support system?
Answer. The Secretary formed the Dairy Industry Advisory Committee
(DIAC) which was made up of 17 milk producers, processors, retailers,
and academic members. The DIAC has worked over the past year to develop
a set of recommendations for dairy policy reform. The Department is
currently reviewing those recommendations. The recommendation of the
DIAC can be found at: http://www.fsa.usda.gov/Internet/FSA_File/
diac_final_rpt_0302.pdf.
Question. Do you believe that a supply management system will help
stabilize dairy prices? And if so, will the market stabilize at a level
that is sustainable for both producers and processors?
Answer. Developing and administering a supply management system to
stabilize dairy prices at a level that is sustainable for both
producers and processors could prove to be a tremendous challenge.
Finding the correct balance between producer and processor price
desires in an ever changing domestic and international marketplace
could be difficult. While the DIAC recommended that the Federal
Government should adopt a growth management program by a narrow margin,
the subcommittee was not prepared to endorse a specific plan or agree
on whether better coordinating milk marketings with milk usage over
time in order to reduce milk price volatility should be a public or a
private endeavor.
dairy insurance program
Question. Crop insurance has been a great asset to row crop farmers
across the country looking to manage their risks, but to date the dairy
insurance program, Livestock Gross Margin for Dairy (LGM-Dairy), has
not seen the same successes.
Is a new dairy insurance program needed to ensure that farmers have
a bona fide safety net and a sound financial management strategy?
Answer. The Risk Management Agency (RMA) has administered the LGM-
Dairy pilot program since 2009. Until this year, the pilot program
experienced very low participation. During summer 2010, the Federal
Crop Insurance Corporation Board of Directors approved two program
changes that have had a significant impact on participation. The board
revised the date that premium is due from the producer until the end of
the coverage period, and instituted a graduated producer premium
subsidy. These changes went into effect for the December 2011 sales
period, and RMA saw a significant jump in participation. Participation
in the LGM-Dairy policy has continued to grow each month since then,
until program funding was exhausted during the March 2011 sales period.
(The Federal Crop Insurance Act limits funding to not more than $20
million for administrative costs to cover all livestock pilot programs,
which generally include any premium subsidy and administrative and
operating expenses. There are currently eight livestock pilot programs
available, and LGM-Dairy was allocated approximately $16.2 million with
the remaining amount left to fund the other livestock programs based on
their historical rate of spending.) During this short period of sales
time reflecting the new program changes, private companies wrote and
RMA will reinsure about 44 million cwt. of milk, representing about 2.5
percent of the market. Thus, dairy producers have responded to these
changes indicating they believe the LGM-Dairy program has become a
viable risk management strategy.
Question. If every dairy farmer in the country were to opt in to
the existing LGM-Dairy program, what would be the annual expected cost
to the Federal Government? If we found a way to reduce the volatility
of the dairy market, how would this annual expected cost change?
Answer. If every dairy farmer were to use the LGM-Dairy product,
USDA estimates it would need approximately $715 million to support this
program, based on the recent market conditions and purchasing patterns
of dairy producers. If the volatility in the dairy market were reduced,
both the cost to dairy producers and the amount of premium subsidy paid
to dairy producers would decrease, but it is not possible to provide
any meaningful estimates as to how much savings that might entail given
the wide range of potential scenarios to consider.
invasive pests
Question. California farmers, unlike farmers in many other States,
pride themselves on receiving very little by way of Federal subsidies.
But what I do hear is that they need assistance in finding ways to
control invasive pests that come across the border from Mexico or
through our international ports. The European grapevine moth, just
discovered last year, already has the potential to devastate the $3.2
million California grape and wine industry. The red palm weevil, just
discovered this year, threatens the date industry and poses a serious
public safety threat. And of course, the Asian citrus psyllid, which
has been found in San Diego, Imperial, Orange, Riverside, and Los
Angeles counties is poised to overwhelm citrus producers in California,
just as it overwhelmed the Florida producers only 3 years ago.
Simply put, U.S. agriculture is facing threats from foreign pests
and diseases like never before, and the USDA must do more to help
growers address these bugs.
The Congress included section 10201 in the 2008 farm bill which
authorized funding for States and localities to address invasive pest
problems in new and unique ways, but the funding for this program is in
question because the Commodity Credit Corporation (CCC) will not
release the funds to pay for these activities. What are you doing to
ensure that this funding goes out in a timely manner?
Answer. We recognize your concern about the threats that U.S.
farmers face from invasive pests and diseases and the potential for
section 10201 programs to help with early detection and control of new
infestations. The Animal and Plant Health Inspection Service (APHIS)
has taken steps to improve the process for allocating section 10201
funds and worked with a variety of stakeholders, including the National
Plant Board, specialty crop stakeholder groups, State partners, and
others, to develop criteria for evaluating proposals for the funds.
The Commodity Credit Corporation Charter Act (15 U.S.C. 714i)
limits the availability and use of section 11 CCC funds for salaries
and related expenses, including technical assistance, associated with
the implementation of farm bill programs. Language was included in the
American Recovery and Reinvestment Act of 2009 that allowed APHIS, and
certain other USDA agencies, to utilize the funds of CCC to administer
certain 2008 farm bill programs in fiscal year 2009 and fiscal year
2010. However, this authority expired at the end of fiscal year 2010
and without this authority to use CCC funds to administer farm bill
programs going forward, APHIS and other agencies would have to reduce
discretionary program funding and use appropriated funds to carry out
mandatory farm bill programs.
For fiscal year 2011, USDA requested language be included in the
full-year appropriations bill that would allow section 11 funds of CCC
to be available for salaries and related administrative expenses
associated with the implementation of certain farm bill programs
without regard to the limitation contained in section 11 of the CCC
Charter Act. The fiscal year 2012 budget includes $50 million for
section 10201.
Question. What authorities and resources can APHIS use to address
emerging pests and diseases prior to congressional approval of the
action?
Answer. Under section 442 of the Plant Protection Act, the
Secretary of Agriculture may transfer funds from other appropriations
or funds available to the agencies or corporations of the USDA in
connection with emergencies in which a plant pest or noxious weed
threatens any segment of U.S. agriculture. For example, USDA released
$16.9 million from CCC for the European vine moth in fiscal year 2011.
APHIS can also use its appropriated Contingency Fund to address small-
scale outbreaks.
Question. I was pleased to see that the President's budget included
$44.8 million for the Citrus Health Research Program because this
program is critical to ensuring that the citrus industry has a future
in our country. Can please update me on what progress has been made in
developing citrus trees that are resilient to the Huanglongbing disease
carried by the citrus psyllid?
Answer. Industry-led research to develop citrus greening-resistant
trees began in 2007. The company that developed the trees is currently
conducting field trials under a permit from APHIS on genetically
engineered (GE) trees that have shown disease resistance in a
laboratory setting. If the trees perform well in the field, the company
will likely petition APHIS to determine the GE trees' regulatory status
so that they can be commercialized.
APHIS is working to coordinate and accelerate research efforts to
identify tools that can assist producers with sustainable management of
citrus greening, including development of disease-resistant trees. USDA
has established the Citrus Research Coordination Group, a collection of
representatives from USDA agencies, universities, States, and citrus
industry organizations. This group is coordinating the comprehensive
research being conducted by more than 150 scientists dedicated to
finding the necessary tools and solutions for citrus greening. The
research efforts focus on several critical areas, including: crop
improvement by developing disease-resistant trees; horticulture
management strategies designed to maintain productive trees, even if
they are infected with citrus greening; early-detection technology to
find the disease; and tools to track infectious citrus psyllid
populations and limit their encroachment into citrus production areas.
antibiotics
Question. I remain concerned about the routine use of antibiotics
in the food and water of animals that are not sick. While I understand
that these antibiotics may improve feed efficiency, it also facilitates
the development of antibiotic-resistant bacteria.
The President's fiscal year 2012 budget request announces that the
Agricultural Research Service (ARS) plans on launching a biotherapeutic
discovery program to find alternatives to antibiotics in animal
agriculture. Can you provide more details on this initiative and when
you plan on implementing this program?
Answer. The incidence of antibiotic resistance in pathogenic
bacteria is rising. This presents one of the greatest threats to human
health in the 21st century. Public health concerns with antibiotic
resistance are driving new proposed regulations and policies to
restrict the use of antibiotics in animal production. Developing
alternatives to antibiotics is therefore becoming a critical issue for
food animal medicine. The ARS Animal Health Research Program is using
new information emerging from the rapidly expanding ``omic''
technologies (e.g., animal genomics, metagenomics, transcriptomics,
proteomics, metabolomics) to discover new molecules with antimicrobial
activity that can be developed as alternatives to antibiotics. The ARS
Animal Health National Program plans for fiscal year 2012 include
launching a biotherapeutics discovery program that will focus initially
in the following strategic areas:
--innate immune molecules with antimicrobial function;
--bioactive phytochemicals (herbal extracts and volatile oils); and
--demonstrated synergistic approaches that could both reduce costs
and increase efficacy while reducing the risk of drug
resistance development.
This animal health initiative cross-cuts other national programs,
such as the ARS Food Safety Research Program, which includes research
on alternatives to antibiotics, microbial ecology, and the effect of
processing environments on antibiotic resistance prevalence.
Question. Should the USDA and ARS receive funding less than the
President's fiscal year 2012 request, will this inhibit the program?
Answer. If ARS receives funding less than the fiscal year 2012
request, this will prevent the launch of the proposed animal health
alternatives to antibiotics research program.
Question. Are you working with the Food and Drug Administration
(FDA) in relation to its proposed draft guidance regarding the use of
antimicrobials in food-producing animals? When can we expect to see
this guidance implemented on the farm?
Answer. ARS provided significant input to the development of the
draft guidance document. USDA has collectively drafted a response plan
to FDA's latest guidance document on the voluntary reduction of growth
promoters in agriculture. APHIS is the lead agency for USDA
interactions and any timeline for on-farm implementation.
organic
Question. Organic agriculture is one of the fastest growing
segments of the rural economy. It creates nearly 150,000 jobs and
provides farmers with lucrative market opportunities.
But Federal investment in organic research and market data has
lagged behind its fair share--organic agriculture makes up about 3.7
percent of the total industry, but research in this new and promising
area only makes up 2.6 percent of the total USDA research budget. I was
pleased to see the agency's plan to spend $20 million in the Organic
Agriculture Research and Extension Initiative (OREI) and an additional
$5 million in the Organic Transitions program, but I believe more must
be done to help ensure the continued growth of this industry.
What additional resources can be made available to help organic
farmers discover and understand the best ways to address invasive pests
and diseases?
Answer. In the 2011 OREI, research and extension to develop and
improve systems-based Integrated Pest Management (IPM) programs for
organic crops was one of the seven priority areas. Specifically, we
requested systems-based evaluations that could include the safety and
efficacy of allowable pest management materials and practices. Special
emphasis was given in the 2011 request for applications to research
relating to management of diseases, insect pests, and weeds in specific
regions where organic acreage is increasing, and yet remain deficient
in terms of numbers of certified and exempt organic farms, as compared
to nationwide averages. For example, the southern region lags behind
the northeastern and north central regions in organically certified
acreage. Additional research and extension on pests, weeds, and
diseases that may limit production in those regions should help
overcome barriers to the growth of organic farming in these
underrepresented regions. The southern region is often the first place
that invasive plants, diseases, and pests are noticed. Controlling them
in the region in which they first appear can help reduce the spread to
other regions, as well as making additional management tools available
as they are needed. Research in organic systems is particularly
valuable, because organic farmers rely on a systems approach that
includes rotation, cover crops, tillage, biological controls, and less
toxic materials. Thus resistance is less likely to develop to a
specific material.
Invasive pests, weeds, and diseases also can be a problem in animal
agricultural systems. An additional priority in the 2011 OREI was to
develop or improve systems-based animal production and pest management
practices, especially in the areas of nutrition, grazing, pasture, and
confinement requirements, to improve animal productivity, health, and
welfare, while retaining economic viability. Thus two of the seven
priorities in OREI pertained directly to pest, weed, and disease
issues. In addition, plant breeding and animal selection for pest and
disease resistance comprised two additional priorities of the seven.
Therefore, more than one-half of the priorities for this program deal
with some aspect of research and extension on management of pest,
weeds, and diseases in organic farming systems. Compiling extension
resources is another priority, and these resources could also address
pest, weed, and disease management.
The Sustainable Agriculture Research and Education (SARE) program
is another source of competitively awarded funding for improved pest
management in organic production systems. Historically, approximately
20 percent of the SARE program awards have been for applied research in
organic systems and pest control has been one of the predominant focus
areas for the proposals that we receive. The SARE program had a funding
line in 2010 of $14.5 million for research and education and a funding
line of $4,705,000 for professional development and training. Together
these funds allow SARE to provide a seamless continuum that links
research with outreach and implementation. The fiscal year 2012 budget
proposes increases of $10.8 million for SARE, including $10 million for
the creation of a new Federal-State matching-grant SARE program to
assist in the establishment and enhancement of State-sustainable
agriculture research, education, and extension programs. These
increases will bring the total SARE funding to $30 million in 2012.
In fiscal year 2012, total ARS and NIFA funding will provide more
than $38 million for direct organic research. ARS spends an additional
$32.5 million on research which indirectly contributes to organic
production.
Question. What internal work is being done by ARS or other USDA
entities that reduces the need for harsh chemical pesticides and
improves the effectiveness of greener and organic alternatives?
Answer. ARS organic farming research is focused on understanding
the scientific basis of biological and physical processes innate to
plants, soils, invertebrates, and microbes that naturally regulate pest
problems and soil fertility. ARS organic research emphasizes whole-
system preventative solutions, rather than one-for-one substitution of
conventional production materials and practices with organic ones.
Results from ARS organic research can also benefit conventional
agriculture by reducing the need for purchased synthetic agricultural
chemicals. ARS organic research activities are coordinated with other
agencies through the USDA Organic Working Group. In March 2011, three
Research, Education, and Economics agencies (ARS; the Economic Research
Service (ERS); and the National Institute of Food and Agriculture
(NIFA)) together with the Office of the Chief Scientist and the Office
of the Secretary hosted a very successful USDA Organic Research
Conference in Washington, DC. Feedback from participants indicated that
many were pleasantly surprised by the breadth, depth, and level of USDA
support for organic agriculture research. Some specific examples of ARS
internal research objectives and activities are:
--Identify genetic plant growth efficiency mechanisms and combine
with soil fertility management strategies to increase crop
productivity with improved cultivars suited to organic
production conditions.
--Develop whole-system biological-based management strategies for
weed, insect pest, and disease control using preventive
approaches as first defense, and therapeutic controls as rescue
practices.
--Develop whole-system biological-based management strategies for
prevention of parasites in small ruminant grazing animals.
NIFA is engaged with a wide range of research, education, and
extension programs that develop and help agricultural producers adopt
IPM approaches on their farms and ranches. IPM provides a sustainable
approach to managing pests by combining biological, cultural, physical,
and chemical tools in a way that minimizes economic, health, and
environmental risks. These approaches encourage the use of the most
environmentally friendly and sustainable methods for managing pests.
NIFA programs support the development of IPM strategies and bio-based
methods like biological control methods, microbial pesticides, mating
disruption tactics, genetic manipulation of pests, and improving plant
resistance to pests and diseases. The adoption and implementation of
these science-based IPM methods helps reduce the need for pesticides on
conventional and organic farms and ranches.
The National Organic Program (NOP) strictly regulates the
pesticides that can be utilized in certified organic production. In
most cases, these materials are less toxic and have reduced potential
for an adverse environmental impact. In certified organic production,
many of the allowed pesticides are restricted to use as a ``last
resort'' in an overall approach that relies first and foremost on
biologically based materials and cultural management practices. These
practices include tillage, rotation, and cover cropping as a preferred
alternative to herbicide usage. Very few herbicides are allowed in
certified organic production. All these practices utilized by organic
farmers reduce the potential for the development of resistance in pest
and weed populations and the necessity for increasingly harsh and
frequent application of pesticides.
Question. Organic products receive a substantial premium at market,
and this has helped many farmers increase their income and improve
their living conditions. But along with this premium comes the
possibility that some farmers may seek to cheat the system and make
false ``organic'' claims.
Please explain how $10 million for NOP is sufficient to regulate
and enforce a set of complex standards on more than 16,000 certified
organic operations. What assurances can you give me, and all consumers
of organic goods, that the USDA ``Organic'' label really means that the
product was grown without pesticides or hormones?
Answer. NOP accomplishes its main mission by accrediting private
and public entities as certifying agents to conduct organic
certification of production and handling operations. There are
currently 94 accredited certifying agents located around the world,
certifying about 27,000 operations, about 17,400 of which are U.S.
domestic operations. NOP authorizes the State of California to handle
compliance and investigative activities for agents and operations
located in the State. NOP also recognizes six foreign governments
(United Kingdom, Denmark, Israel, New Zealand, India, and Japan) to
exercise oversight for products certified to the NOP standards in their
countries. The United States-Canada Organic Equivalency Arrangement
allows products certified to each country's standards to go to the
other country with minimal additional conditions.
NOP currently has a budget of $7 million which supports 32 staff
members. NOP staff members manage a comprehensive accreditation
program, handle complaints and take enforcement actions on violations
of the regulations, develop and revise standards and policy guidance,
as well as coordinate the activities and implement the recommendations
of the National Organic Standards Board.
NOP ensures organic integrity and consumer assurance through a
rigorous accreditation and certification process. The accreditation
applicants are first assessed through a comprehensive desk audit. Upon
satisfactory completion, an onsite audit of personnel and system is
then conducted. Subsequently, regular audits are conducted at every 2.5
years for all certifying agents, domestic and foreign. NOP
certification is a process-based system that establishes proactive
control measures through the development, approval and implementation
of organic system plans (OSP). The OSPs describe detailed practices and
procedures for production and handling, all inputs used and their
source/composition/application, monitoring practices and procedures,
record-keeping system, and management practices to prevent
contamination and commingling. Implementation of the OSP is verified
through annual onsite inspections.
NOP regulations require pre- or postharvest tests based on
suspected use of prohibited materials or excluded methods. Such tests
are often conducted in the process of complaint investigation and
utilized as a tool to verify compliance. The program is presently
considering additional measures to further deter the use of prohibited
materials.
The program accomplishes these tasks by collaborating with other
entities and leveraging resources to manage this complex global program
within available resources. However, many areas could be enhanced to
increase organic integrity of products shipped to the United States
from around the world. To that end, a $2.9 million increase has been
proposed in the NOP budget for 2012 to conduct additional surveillance
of foreign accredited certifying agents; increase the program's
capacity to investigate complaints and violations (both domestic and
foreign); educate certifying agents worldwide to ensure the organic
regulations are consistently applied; and respond to requests for
international equivalency agreements.
Question. Could you please provide me with a report on all
enforcement actions taken by NOP in 2010, and with an enforcement
strategy for the remainder of 2011 and beyond?
Answer. Responsibility for enforcement of the NOP regulations is
shared by the certifying agents and NOP. Certifying agents ensure the
correct implementation of NOP standards through annual inspections and
require corrective actions by operations when noncompliances are
identified. NOP takes enforcement action as part of its complaint
investigation and accreditation audit processes.
NOP has increased its enforcement activities, not only in the
United States but also in foreign countries, through monitoring
recognition agreements and certification activity of foreign certifying
agents. During fiscal year 2010, NOP conducted compliance assessments
in Canada, Egypt, Israel, Denmark, Ghana, and China. AMS auditors also
conducted organic audits in Argentina, Italy, Germany, Bolivia, and
Mexico.
During fiscal year 2010, NOP closed 123 complaints. As a result of
investigating these complaints, NOP issued 10 civil penalties, totaling
$64,000; and issued 52 cease-and-desist letters that stopped
inappropriate use of the NOP logo or label.
Through the enforcement activity of NOP, three certifying agents
have lost their accreditation status (Guaranteed Organic Certification
Agency, California; California Organic Farmers Association, California;
and Certified Organic, Incorporated, Iowa). Those certifying agents are
no longer permitted to certify organic producers or handlers.
For the remainder of 2011 and beyond, NOP's No. 1 priority is to
protect organic integrity through enforcement activities. NOP's plan is
focused on the following 10 points:
--clear, enforceable standards;
--timely notification to certifiers, organic producers, and handlers
concerning changes/clarifications to the standards;
--transparency of suspensions, revocations, adverse actions, and
sanctions;
--quality certification program;
--effective and efficient complaint handling process;
--penalties for willful violations;
--market surveillance inspections;
--unannounced inspections;
--periodic pesticide residue testing; and
--continual improvement.
section 502 and mutual self-help housing program
Question. The administration's budget proposes to reduce funding
for affordable housing for low-income families and improving housing
conditions in smaller, poorer rural communities. The Department's
Section 502 Single-Family Housing Direct Loan Program was funded at
$1.02 billion, but the administration has requested $211 million for
fiscal year 2012. This is a cut of nearly 79 percent to a program that
small towns and rural communities rely on for affordable housing. In
addition, the Mutual and Self-Help Housing Program, which was funded at
$43 million in fiscal year 2010, has been eliminated in the
administration's request.
How will the Department continue to offer affordable housing to
low-income families in rural areas despite the elimination of the
Mutual and Self-Help Housing Program and a major budget cut in the
section 502 program?
Answer. Housing is a vital economic pillar in rural America for
creating wealth for communities and homeowners. USDA realizes that
rural populations tend to be more economically challenged with lower
incomes and fewer housing choices than their suburban and urban
counterparts, and therefore we continue to offer a no-down payment
homeownership program through both the Single-Family Housing Guaranteed
and Direct Loan programs.
Providing credit in areas that lack private investment is a
critical function of USDA Rural Development. To address the need for
credit--particularly in the rural housing market--Rural Development has
dramatically increased the Single-Family Housing Guaranteed Loan
Program in recent years, doubling the Government's investment from $12
billion in 2010 to $24 billion in 2011. In these austere fiscal times,
we are investing more than ever in rural housing at no cost to the
taxpayer, because the Single-Family Housing Guaranteed Loan Program has
a negative subsidy rate and does not require budget authority.
The need to address the state of the current housing stock, in
particular for very low-income seniors, and in areas of persistent
poverty like tribal lands and border communities, will be met through
the Section 504 Home Repair Grant Program. There are fewer affordable
housing options in smaller and more rurally remote communities and we
continue to grow the Section 515 Multifamily Direct Program to address
needs in these communities. Often the section 515 program is the
critical element in making a low-income housing tax credit deal work in
rural communities that are starved for private investment. We already
serve hundreds of thousands of very-low and low-income tenants through
our multifamily housing programs, and we intend to continue to invest
in new properties and the revitalization of existing units.
USDA intends to continue a partnership in the immediate future with
the Self-Help Housing Technical and Management Assistance (T&MA)
contractors to provide guidance to Self-Help Housing grantees. As we
transition out of a program that we recognize has made major
contributions to rural housing, we will no longer have the ability to
fund the administrative costs associated with Self-Help Housing due to
budget constraints. Together with the grantees and T&MA contractors,
USDA will identify other means for grantees to garner fees for their
services and address regulations that will accommodate new ideas.
______
Questions Submitted by Senator Mark Pryor
formula funds
Question. Over the last three decades, formula funds (land grant
institutions) as a percentage of the U.S. Department of Agriculture
(USDA) extramural funding have declined in both absolute and relative
amounts. To rectify that drop, the Congress filled in the gaps with
special grants--earmarks--that are no longer available. With inherent
limitations on the scope and effectiveness of competitive-funded
research and extension, do you believe it is wise to reduce our formula
fund investment by 5 percent?
Answer. Although we are proposing modest cuts in formula funds, the
National Institute of Food and Agriculture (NIFA) has proposed
significant increases in the Agriculture and Food Research Initiative
(AFRI) competitive grants program that includes increased investments
in the integrated programs of AFRI. These integrated programs provide
significant opportunities for support of multidisciplinary and
multistate extension programs. Strong extension components within the
integrated programs of AFRI will help ensure that research findings are
accessible to agriculture producers and other key stakeholders. In
addition, NIFA proposes to continue support for our electronically
based initiative, eXtension, to ensure broad access to peer reviewed
research-based information.
research
Question. Why did the administration decide to cut funding to the
Agricultural Research Service (ARS) at a time when we are depending on
our leadership in science and technology to help our economy recover
from the recession?
Answer. The President's fiscal year 2012 budget request for ARS
proposes a net decrease of $41.9 million. The budget proposes an
increase of $58.7 million, including $55.7 million for new and expanded
research initiatives in food safety, child and human nutrition; crop/
animal breeding and protection; bioenergy/biomass; plant, animal, and
microbial collections; production systems for sustainable agriculture;
global climate change; and the National Agricultural Library.
Investments in these high-priority programs will be critical to keeping
the food and agriculture sector of the economy strong. These increases
are offset by the proposed reduction or termination of ongoing ARS
programs. The proposed net reduction in the fiscal year 2012 budget for
ARS is achieved through the elimination of earmarked and other lower-
priority projects.
housing programs
Question. Can you explain why the administration has sharply
reduced funding for the Section 523 Mutual Self-Help Housing Program
and the Section 502 Single-Family Housing Direct Loan Program which
have been both successful and important in rural America?
Answer. The Department believes that the Section 502 Single-Family
Housing Guaranteed Loan Program is the most cost-effective approach to
providing a large number of housing loans. With a $24 billion level, at
a negative subsidy rate, the program provided more assistance and
served more families in rural areas by far than any other housing
program at the Department. For example, more than 30 percent of the
loans made last year, were made to low-income families, the target
population of the Section 502 Single-Family Housing Direct Loan Program
(commonly known as the section 502 direct program). In fact the 30-
percent figure represented 43,708 loans to low-income families, more
than have ever been made in a single year by the section 502 direct
program. While both the section 502 direct program and the Section 523
Mutual Self-Help Technical Assistance Grant programs have assisted low-
income families, they are much more costly than the Section 502 Single-
Family Housing Guaranteed Loan Program.
forest legacy projects
Question. I understand that the administration ranks Forest Legacy
projects. Can you explain a little bit about that process? And can you
explain to me how the projects will be funded? Will you go straight
down the ranking list and fully fund project No. 1, No. 2, No. 3, and
so on until you run out of funds?
Answer. Program priorities are developed in consultation with
participating State-lead agencies. Each summer, the Forest Service
sends a call letter to States asking them to provide a prioritized list
of up to three projects. These projects always involve willing sellers
who voluntarily seek to participate in the Forest Legacy Program. In
many cases, there are other partners from the local community and
forestry and conservation organizations who support the projects.
The call letter includes the scoring criteria that details how the
projects will be ranked. In January, a panel convenes for 2 days to
rank the projects and develop a prioritized list. The panel is composed
of 10 members: 6 Forest Service employees and 4 representatives from
State agencies responsible for implementing the Forest Legacy Program.
Each member arrives at the panel having reviewed and scored the
proposed projects based upon the scoring criteria. Once the prioritized
list is developed, it is cleared through the Forest Service and the
USDA and becomes part of the President's budget proposal to the
Congress.
The intent is to follow the prioritized list as developed and fund
as many projects as funding allows. The Forest Legacy prioritization
process is well-developed and understood by our State partners and
other conservation interests and we believe it is important to adhere
to the competitively developed list.
china food safety system
Question. Can you please bring the subcommittee up to speed on how
things are progressing with the implementation of section 743 of the
fiscal year 2010 appropriations bill? Are the Chinese cooperating with
efforts to establish the equivalency of their food safety laws with
those of the United States?
Answer. From December 1-21, 2010, FSIS conducted two separate but
simultaneous audits of China's poultry inspection system: one for
poultry processing and one for poultry slaughter. FSIS continues to
analyze materials provided by China during the on-site audits, and
sought published information on China's food safety system from various
domestic and international agencies, as part of its equivalence
evaluation of China's poultry inspection system.
FSIS will submit two separate audit reports to China. China will
then be responsible for working with FSIS to address any concerns that
may be raised in the reports.
To date, FSIS has obtained from China's primary food safety
authority all of the information necessary to conduct the equivalence
audits.
grain inspection, packers and stockyards administration rule
Question. Can you tell the subcommittee the status of the new
analysis of the Grain Inspection, Packers and Stockyards Administration
(GIPSA) rule, and explain how the administration is working to improve
the rulemaking process at USDA?
Answer. GIPSA provided 150 days for the public to comment on the
rule. The agency received 61,000 comments, and it is currently
reviewing and analyzing the comments that were received. The Department
will take the following steps in developing the final rule:
--Conduct a content analysis of comments and identify those requiring
additional legal and policy analysis;
--Evaluate the proposed cost-benefit analysis in light of comments
and revise as necessary;
--Draft a regulatory workplan and submit to the Office of Management
and Budget (OMB);
--Revise the rule as necessary;
--Enter the rule into Departmental clearance;
--Submit the rule for OMB clearance; and
--Publish the rule.
The cost-benefit analysis that is being conducted will be guided by
the comments that we received during the comment period. Further,
officials within the Department and OMB will clear this rule before the
rule is promulgated. USDA's Chief Economist, Joseph Glauber is taking
the lead in coordinating a team of economists across the Department to
provide rigorous review of the comments.
______
Questions Submitted by Senator Susan Collins
resource conservation and development funding
Question. The U.S. Department of Agriculture's (USDA's) Resource
Conservation and Development (RC&D) program provides important
resources for many rural communities in Maine and around the country.
RC&D-sponsored activities have led to more sustainable communities,
better informed land use decisions, and sound natural resource
management practices.
Maine's five RC&D councils have proven their effectiveness through
a number of accomplishments. During fiscal year 2010, 79 RC&D projects
were actively worked on and 35 projects were completed. Maine RC&D
councils participate in a variety of successful projects that range
from providing technical assistance for the development of community
wind projects to helping build and sustain agricultural businesses.
One of the main benefits of the RC&D program is the promotion of
local economies through the leveraging of Federal dollars. According to
the National Association of RC&D Councils, the RC&D program returns
$5.60 for every $1 the Federal Government invests to support economic
development and resource protection in rural areas. For some RC&D
councils the leverage is even greater.
In fact, the administration's budget document cites the program's
history of success and ability to attract non-Federal dollars as a
reason why Federal funding is no longer necessary. I appreciate that
these are difficult budget times, and difficult decisions must be made
as to where to allocate limited Federal dollars. I wonder, though,
whether it makes sense to eliminate funding for successful programs.
Shouldn't we be supporting programs that have a proven track record of
being able to attract and leverage non-Federal funds?
Answer. President Barack Obama's budget proposal eliminates Federal
technical assistance to the 375 RC&D councils, the majority of which
have received Federal support for at least 10 years. Given the current
budget situation, we have had to make some difficult funding decisions.
As nonprofit organizations, RC&D councils will still exist and we
believe that most have the capacity to identify, plan, and address
their identified priorities without the need for continued Federal
support. The RC&D program is not being targeted due to poor performance
or lack of effectiveness. RC&D has been a remarkable program since 1964
and it is expected that many councils will continue to provide services
to their communities.
integrated pest management
Question. Mr. Secretary, the science-based principles of Integrated
Pest Management (IPM) have proven to be valuable tools for American
agriculture. IPM has allowed American agriculture to address food
safety issues by maintaining crop quality, avoiding crop losses,
improving pest management strategies, and minimizing negative impacts
to the environment. The four regional IPM centers have been invaluable
in their effort towards increasing IPM programming breadth and depth
throughout the United States. Many of these programs funded via USDA
have demonstrated excellent cost-benefit ratios. For example, the
University of Maine Cooperative Extension Potato IPM Program showed in
2009 that for every USDA $1 invested, $58 in benefits were returned.
The UMaine's IPM program Web site is visited thousands of times per
growing season, showing how integral it is to the potato industry.
Farmers use the program to more appropriately treat their crops, to
lessen the impact of chemicals to the environment, and to catch
troubling diseases, like late blight and pests sooner.
Given the importance of these IPM programs, how does USDA plan to
not only maintain but enhance these valuable IPM programs?
Answer. The National Institute of Food and Agriculture (NIFA)
recognizes the importance of IPM in our science portfolio and will
continue to provide national leadership for IPM research education, and
extension programs. NIFA will continue to support IPM research,
extension and education efforts through the Agriculture and Food
Research Initiative (AFRI) and other NIFA programs. The consolidation
of funding authorities into broader programs such as AFRI enhances
NIFA's ability to address issues confronting U.S. agriculture in a more
holistic way, and with a scale of investment that is large enough to
make a real difference. Consolidation will also reduce transaction
costs and improve the efficiency of program management in a climate of
limited resources.
In fiscal year 2010, AFRI was restructured so that investments
could be focused on five societal challenge areas: global food
security, climate change, food safety, sustainable bioenergy, and
childhood obesity prevention. The development of IPM methods for plant
and animal production systems is a key element of efforts to ensure
global food security, respond to climate change, and develop
sustainable bioenergy production systems. AFRI supports the development
and implementation of IPM approaches that help us address these
challenge areas and contribute to the sustainability of U.S.
agriculture.
For fiscal year 2012, NIFA will seek to expand the role and
influence of science in agriculture through focused, problem-solving
research, education, and extension activities related to IPM challenges
in plant and animal production systems. The proposed budget
consolidates funding for the Expert IPM Decision Support System, Pest
Management Alternatives, and IPM and Biological Control into a single
program to improve the efficiency of program implementation resulting
in research investments with greater focus, more appropriate scale, and
enhanced impact. The proposed budget maintains funding for the Smith-
Lever 3(d) Pest Management Program, which addresses many challenges
facing agriculture and the environment by delivering science-based IPM
methods to producers and agricultural professionals. Supplemental
programs like the IPM Potato Late Blight project with the University of
Maine Cooperative Extension Potato IPM Program further address
significant issues and are closely aligned with the Smith-Lever 3(d)
program.
foreign market development programs
Question. Programs that increase market access for American
agricultural products are important to increasing exports and market
share for our farmers. In 2008, at the height of the economic downturn,
Maine's wild blueberry industry was beginning market development work
in China. Although it often can take 5 or 6 years to fully develop a
new export market, Maine's wild blueberry industry was able to grow its
market in China by 73 percent between 2009 and 2010.
Given the importance of such efforts and the President's National
Export Initiative (NEI), why has the administration only provided a 1-
percent increase for such programs?
Answer. The administration fully concurs that programs to increase
market access for American agricultural products are important to
increasing exports and market share for American farmers. To that end,
the President's fiscal year 2012 budget includes full funding for the
Market Access Program, Foreign Market Development Program, Emerging
Markets Program, and Technical Assistance for Specialty Crops Programs
consistent with the provisions of the 2008 farm bill; total funding for
those programs is $253.5 million. In addition, the fiscal year 2012
request includes an increase of $20 million to provide additional
funding for Foreign Agricultural Service market development efforts in
support of NEI.
forest legacy
Question. Maine has the largest private forest ownership in the
country--some 18 million acres of diverse forest covering roughly 90
percent of its land area. These private landowners are the stewards of
our forests and the caretakers of the natural resources that are vital
to Maine's forest-products industry. In addition, they are the hosts
for our increasingly important recreation economy.
One of the most important Federal programs to help forested
landowners preserve working forest, protect natural resources, and
promote outdoor recreation is the Forest Legacy Program. I appreciate
your commitment to this program, and hope we can keep it going for the
remainder of fiscal year 2011, as the House's decision to deeply cut
Forest Legacy funding will directly affect Maine.
Maine's West Grand Lake Community Forest project, for example, was
ranked the No. 1 Forest Legacy project in the Nation for 2011 through a
competitive scoring process. This project will ensure sustainable
forest management and public recreational access. It will also preserve
and enhance Maine's timber economy and Grand Lake Stream's 180-year
outdoor recreation heritage. It is a project led by the local community
and accomplished in partnership with community, State, Federal, and
nonprofit partners. West Grand Lake is a shining example of how the
Forest Legacy Program works with local communities to prevent the
conversion of forest land to nonforest uses while sustaining and
improving both our local timber and recreational economies.
I understand that there is a great deal of uncertainty right now as
to what the Department's budget will look like for the remainder of the
fiscal year. And beyond fiscal year 2011, there are many worthy
projects being proposed for fiscal year 2012. Recognizing that things
are still very much in the air, has the Department considered how it
might allocate funding within the Forest Legacy Program at a reduced
funding level? It is my understanding that the fiscal year 2012 request
assumes that the projects that were priorities for fiscal year 2011 are
funded this year. How will Department allocate funding among the fiscal
year 2011 and fiscal year 2012 priorities should full funding not be
provided this year?
Answer. Currently, the intent is to adhere to the prioritized list.
We are aware that the funded list may be a short one. The Forest Legacy
Program prioritization process at the national level is undertaken
without a known funding level. The intent is to identify the most
important forestland for conservation funding. The relative importance
of the projects does not change because of funding levels and we intend
to adhere to the prioritized list.
It is true that there are projects on both the fiscal year 2011 and
fiscal year 2012 priority lists. Due to the uncertainty of the fiscal
year 2011 funding at the time of the fiscal year 2012 call for
projects, some States chose to submit, as their priority, projects on
the fiscal year 2011 list for consideration in fiscal year 2012. Each
funding year represents a distinct national competition of projects.
Fiscal year 2011 projects will not be prioritized in fiscal year 2012
as only projects submitted in response to the call for proposals for
fiscal year 2012 will be on the fiscal year 2012 project priority list.
SUBCOMMITTEE RECESS
Senator Kohl. Thank you, Senator Pryor.
And thank you very much, Secretary Vilsack.
We have about 5 minutes left in the vote.
But you've done a great job, been very complete. You've
offered a lot of information, and we very much appreciate your
coming here today. We're all looking forward to continuing to
work with you.
Secretary Vilsack. Thank you.
Senator Kohl. Thank you so much.
The hearing is recessed.
[Whereupon, at 3:05 p.m., Thursday, March 10, the
subcommittee was recessed, to reconvene subject to the call of
the Chair.]
MATERIAL SUBMITTED SUBSEQUENT TO THE HEARING
[Clerk's Note.--The following testimony was received
subsequent to the hearing for inclusion in the record.]
Prepared Statement of Hon. Leland A. Strom, Chairman and Chief
Executive Officer, Farm Credit Administration
Mr. Chairman, members of the subcommittee, I am Leland A. Strom,
chairman and chief executive officer of the Farm Credit Administration
(FCA). On behalf of my colleagues on the FCA Board, Kenneth Spearman of
Florida and Jill Long Thompson of Indiana, and all the dedicated men
and women of FCA, I am pleased to provide this testimony.
Before I discuss FCA's role, responsibilities, and budget request,
I would like to thank the subcommittee staff for its assistance during
the budget process. Also, I would respectfully bring to the
subcommittee's attention that the funds used by FCA to pay its
administrative expenses are assessed and collected annually from the
Farm Credit System (FCS) institutions we regulate and examine--the FCS
banks, associations, and service corporations, and the Federal
Agricultural Mortgage Corporation (Farmer Mac). FCA does not receive a
Federal appropriation.
Earlier this fiscal year, FCA submitted a proposed total budget
request of $62,299,787 for fiscal year 2012. FCA's proposed budget for
fiscal year 2012 includes funding from current and prior assessments of
$62,000,000 on FCS institutions, including Farmer Mac. Almost all this
amount (approximately 82 percent) goes for salaries, benefits, and
related costs.
The fiscal year 2012 proposed budget is driven largely by two
factors:
--stress on FCS caused by conditions in the agricultural and the
general economy; and
--the large number of retirements that FCA anticipates in the coming
5 years.
Although FCS remains safe and sound overall, risks have increased
across FCS, and conditions in several institutions have deteriorated.
As a result, we are hiring additional staff members to provide more
intensive examination and oversight. We are also hiring employees to
fill the positions of those who will be retiring soon. The funding
we've requested for fiscal year 2012 will allow us to provide the
additional supervision and oversight required in challenging economic
times and to ensure that we maintain a staff with the skills necessary
to properly examine, oversee, and regulate FCS.
mission of the farm credit administration
As directed by the Congress, FCA's mission is to ensure a safe,
sound, and dependable source of credit and related services for
agriculture and rural America. FCA accomplishes its mission in two
important ways. First, FCA protects the safety and soundness of the FCS
by examining and supervising all FCS institutions, including Farmer
Mac, and ensures that the institutions comply with applicable laws and
regulations. Our examinations and oversight strategies focus on an
institution's financial condition and any material existing or
potential risk, as well as on the ability of its board and management
to direct its operations. We also evaluate each institution's
compliance with laws and regulations to ensure that it serves all
eligible borrowers, including young, beginning, and small farmers and
ranchers. If an FCS institution violates a law or regulation or
operates in an unsafe or unsound manner, we use our supervisory and
enforcement authorities to take appropriate corrective action. Second,
FCA develops policies and regulations that govern how FCS institutions
conduct their business and interact with customers. FCA's policy and
regulation development focuses on protecting FCS safety and soundness;
implementing the Farm Credit Act; providing minimum requirements for
lending, related services, investments, capital, and mission; and
ensuring adequate financial disclosure and governance. The policy
development program includes approval of corporate charter changes, FCS
debt issuance, and other financial and operational matters.
examination programs for farm credit system banks and associations
FCA's highest priority is to maintain appropriate risk-based
oversight and examination programs to ensure the safety and soundness
of FCS institutions. Given the increasing complexity and risk in FCS
and human capital challenges at FCA, we have undertaken a number of
initiatives to improve operations, increase examination effectiveness,
and enhance staff expertise in key examination areas. FCA bases its
examination and supervision strategies on institution size, existing
and prospective risk exposure, and the scope and nature of each
institution's business model. FCA also performs nationally focused
examinations of specific issues and operational areas to monitor the
condition and operations of FCS as a whole. On a national level, we
actively monitor risks that may affect groups of FCS institutions or
the entire FCS, including risks from the agricultural, financial, and
economic environment.
The frequency and depth of examination activities vary based on
risk, but each institution receives a summary of examination activities
and a report on its overall condition at least every 18 months. FCS
institutions are required to have effective loan underwriting and loan
administration processes, to maintain adequate asset-liability
management capabilities, and to establish high standards for governance
and transparent disclosures for shareholder oversight. Because of the
recent increased volatility in the agricultural and credit sectors, FCA
has increased its on-site examination presence. Also, FCA is closely
watching rapidly rising real estate values in certain sections of the
country to ensure that FCS lending practices remain prudent.
In certain cases, FCA will use its enforcement powers to effect
changes in the institution's policies and practices to correct unsafe
or unsound conditions or violations of law or regulations. FCA uses
FIRS as a key method to assess the safety and soundness of each FCS
institution (see chart above \1\ ). The FIRS provides a general
framework for evaluating significant financial, asset quality, and
management factors to assign component and composite ratings. FIRS
ratings range from 1 (for a sound institution) to 5 (for an institution
that is likely to fail). Overall, FCS remains financially strong and
adequately capitalized. The FCS does not pose material risk to
investors in FCS debt, the Farm Credit System Insurance Corporation, or
to FCS institution stockholders.
---------------------------------------------------------------------------
\1\ Source.--FCA's FIRS Ratings Database. The above chart includes
only the five FCS banks and their affiliated direct-lender
associations. The figures in the bars reflect the number of
institutions by FIRS rating.
---------------------------------------------------------------------------
Although FCS's condition and performance remain satisfactory
overall, a number of FCS institutions are experiencing stress and now
require special supervision and enforcement actions. These actions
reflect the weaknesses in the Nation's economy and credit markets, a
rapidly changing risk environment in certain agricultural segments,
and, in certain cases, management's ineffectiveness in responding to
these risks. We have increased supervisory oversight at a number of
institutions and dedicated additional resources in particular to those
14 institutions rated 3 or worse. Although these 14 institutions
represent less than 4 percent of FCS assets and do not meaningfully
impact FCS's consolidated performance, they require significantly
greater FCA resources to oversee. As of December 31, 2010, five FCS
institutions were under formal enforcement action, but no FCS
institutions are in conservatorship or receivership.
regulatory and corporate activities
Regulatory Activities.--The Congress has given the FCA Board
statutory authority to establish policy, prescribe regulations, and
issue other guidance to ensure that FCS institutions comply with the
law and operate in a safe and sound manner. FCA is committed to
developing balanced, flexible, and legally sound regulations. Some of
FCA's current regulatory and policy projects include the following:
--Revising regulations to implement the requirements of the Dodd-
Frank Act;
--Revising regulations to ensure that FCS funding and liquidity
requirements are appropriate and to ensure that the discounts
applied to investments reflect their marketability;
--Revising regulations to require that each FCS institution's
business plan includes strategies and actions to serve all
creditworthy and eligible persons in the institution's
territory and to achieve diversity and inclusion in its
workforce and marketplace;
--Enhancing our risk-based capital adequacy framework to more closely
align it with that of other Federal banking agencies and the
Basel Accord;
--Revising lending- and leasing-limit regulations to ensure that FCS
institutions maintain effective policies to measure and manage
exposure to single counterparties, industries, and market
segments, and to large complex loans;
--Revising regulations to allow FCS institutions to purchase eligible
agricultural loans from the Federal Deposit Insurance
Corporation;
--Revising regulations to enhance FCS disclosures of senior officer
compensation and supplemental benefit programs; and
--Strengthening investment-management regulations to ensure that
prudent practices are in place for the safe and sound
management of FCS investment portfolios.
Corporate Activities.--While the number of FCS institutions has
declined over the years as a result of mergers, their complexity has
increased, which has placed greater demands on both examination staff
resources and expertise. Generally, these mergers have resulted in
larger, more cost-efficient, and better-capitalized institutions with a
broad, diversified asset base, both by geography and commodity. Thus
far in fiscal year 2011, two mergers of associations have become
effective. In addition, two banks have submitted a plan of merger for
FCA Board consideration. As of January 1, 2011, FCS had 84 direct-
lender associations, five banks, five service corporations, and two
special-purpose entities.
condition of the farm credit system
FCS remained fundamentally safe and sound in 2010 and is well
positioned to withstand the continuing challenges affecting the general
economy and agriculture. Total capital increased to $33.3 billion at
December 31, 2010, up from $30.0 billion a year earlier. In addition,
more than 81 percent of total capital is in the form of earned surplus,
the most stable form of capital. The ratio of total capital to total
assets increased to 14.5 percent at year-end 2010, compared with 13.9
percent the year before, as strong earnings allowed FCS to continue to
grow its capital base.
Loan growth picked up in 2010, especially in the second half of the
year when commodity prices increased sharply. In total, loans grew by
6.4 percent in 2010 compared with 2.1 percent in 2009. Nonperforming
loans decreased modestly to $3.4 billion as of December 31, 2010, and
represented 10.2 percent of total capital at the end of 2010, down from
11.8 percent at the end of 2009. However, although credit quality is
satisfactory overall, the volatility in commodity prices and weaknesses
in the general economy have increased risks to some agricultural
operators, creating the potential for future declines in asset quality.
FCS reported significantly higher earnings in 2010, with a combined
net income of $3.5 billion, up 22.6 percent from 2009. Return on assets
remained favorable at 1.60 percent. FCS's liquidity position equaled
173 days at December 31, 2010, which was essentially unchanged from the
178 days a year earlier and well in excess of the 90-day regulatory
minimum. The quality of FCS's liquidity reserves also improved in 2010.
Further strengthening FCS's financial condition is the Farm Credit
Insurance Fund, which holds more than $3.2 billion. Administered by the
Farm Credit System Insurance Corporation, this fund protects investors
in FCS-wide consolidated debt obligations.
Farm income is expected to be very strong in 2011. The U.S.
Department of Agriculture forecasts $98.6 billion in farm net cash
income--the highest since 1974, after adjusting for inflation. The high
prices that grain, soybean, and cotton farmers will receive for their
products will largely account for this increase. High feed costs,
however, will present challenges for livestock producers. Already tight
supplies of corn and soybeans in the United States could lead to
significantly higher feed costs in 2011 and 2012 if growing conditions
are unfavorable. High grain prices combined with extremely low interest
rates are also propelling farmland values to record highs in parts of
the Midwest. Although the current economy supports today's average land
prices, some factors, such as higher interest rates, geopolitical
developments that could undermine global demand for farm products, and
an unexpected decline in grain prices because of a global supply
response, could lead to a drop in the value of farm real estate. To
address the issue of rising farmland values, FCA organized a meeting
with the other Federal financial regulators to discuss concerns and
observations regarding agricultural land values and associated risk to
loan collateral. Our intent also was to foster a broad-based
interchange on the appropriate regulator response to these risks and to
develop a productive working relationship among banking regulators. We
are considering additional meetings to continue our focus on topics
important to agriculture.
FCS's access to capital markets returned to normal during 2010,
which helped FCS further augment its solid overall financial strength,
serve its mission, and maintain the Insurance Fund. FCS, as a
Government-sponsored enterprise (GSE) with solid financial performance,
benefited from monetary policy actions that helped to foster
historically low domestic interest rate levels. Tepid investor demand
for longer-term FCS-wide debt securities in 2009 improved appreciably
in 2010, particularly for those with maturities of more than 5 years.
Also, FCS continued to enhance its domestic marketing and internal
liquidity reserve requirements. For 2011, FCS expects that the capital
markets will continue to meet all of its financing needs.
federal agricultural mortgage corporation
The Congress established Farmer Mac in 1988 to establish a
secondary market for agricultural real estate and rural housing
mortgage loans. Farmer Mac creates and guarantees securities and other
secondary market products that are backed by agricultural real estate
mortgages and rural home loans, USDA guaranteed farm and rural
development loans, and rural utility loans made by cooperative lenders.
Through a separate office required by statute (Office of Secondary
Market Oversight), FCA regulates, examines, and supervises Farmer Mac's
operations.
Farmer Mac is a GSE devoted to making funds available to
agriculture and rural America through its secondary market activities.
Under specific circumstances defined by statute, Farmer Mac may issue
obligations to the Department of the Treasury, not to exceed $1.5
billion, to fulfill the guarantee obligations on Farmer Mac Guaranteed
Securities. Farmer Mac is not subject to any intra-FCS agreements and
is not jointly and severally liable for FCS-wide debt obligations.
Moreover, the Farm Credit Insurance Fund does not back Farmer Mac's
securities.
Farmer Mac made continued financial progress during 2010. Although
net income was down significantly from 2009, this decline was largely
the result of unrealized gains and losses; however, core earnings, a
measure based more on cash flow, was up by 56 percent. As of December
31, 2010, Farmer Mac's core capital totaled $460.6 million, which
exceeded its statutory requirement of $301.0 million. The result is a
capital surplus of $159.6 million, up from $120.2 million as of
December 31, 2009. The total portfolio of loans, guarantees, and
commitments grew 14 percent to $12.2 billion.
In January 2010, Farmer Mac raised $250 million in capital from a
private offering of shares of noncumulative perpetual preferred stock
of Farmer Mac II LLC, an operating subsidiary in which Farmer Mac owns
all of the common equity. Farmer Mac used the proceeds to repurchase
and retire $150 million of Farmer Mac's outstanding series B preferred
stock, with additional proceeds available for other corporate purposes.
The new preferred stock has a lower net effective cost than the retired
capital and has improved Farmer Mac's ability to generate new capital
through earnings.
Farmer Mac's program-business portfolio shows stress in certain
subsectors but remains manageable. Stress in the ethanol industry, as
well as certain crop and permanent planting segments, contributed to an
increase in the nonperforming loan rate. The nonperforming loan rate
was 1.90 percent at December 31, 2010, compared with 1.41 percent at
December 31, 2009. Loans more than 90 days delinquent increased from
1.13 percent at December 31, 2009, to 1.63 percent at December 31,
2010.
Regulatory activity in 2011 that will affect Farmer Mac includes an
interagency joint Notice of Proposed Rulemaking to implement provisions
of the Dodd-Frank Act relating to capital and margin requirements for
over-the-counter derivatives that are not cleared through exchanges; a
Notice of Proposed Rulemaking on nonprogram investments and liquidity
at Farmer Mac that would, among other things, reduce reliance on credit
ratings as required by section 939A of the Dodd-Frank Act; and an
Advance Notice of Proposed Rulemaking that will request public input on
how to reduce reliance on credit ratings in the methodology underlying
the Risk-Based Capital Stress Test. In addition, FCA plans to finalize
a rule to update the stress test to address Farmer Mac's new rural
utility financing authority and make other technical changes.
conclusion
We at FCA remain vigilant in our efforts to ensure that FCS and
Farmer Mac remain financially sound and focused on serving agriculture
and rural America. It is our intent to stay within the constraints of
our fiscal year 2012 budget as presented, and we continue our efforts
to be good stewards of the resources entrusted to us. While we are
proud of our record and accomplishments, I assure you that FCA will
continue its commitment to excellence, effectiveness, and cost
efficiency and will remain focused on our mission of ensuring a safe,
sound, and dependable source of credit for agriculture and rural
America. This concludes my statement. On behalf of my colleagues on the
FCA Board and at FCA, I thank you for the opportunity to share this
information.
AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND
RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2012
----------
THURSDAY, MARCH 17, 2011
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 1:58 p.m., in room SD-124, Dirksen
Senate Office Building, Hon. Herb Kohl (chairman) presiding.
Present: Senators Kohl, Pryor, Brown, Blunt, and Moran.
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Food and Drug Administration
STATEMENT OF DR. MARGARET A. HAMBURG, COMMISSIONER
ACCOMPANIED BY:
PATRICK McGAREY, ASSISTANT COMMISSIONER FOR BUDGET, FOOD AND
DRUG ADMINISTRATION
NORRIS COCHRAN, DEPUTY ASSISTANT SECRETARY FOR BUDGET,
DEPARTMENT OF HEALTH AND HUMAN SERVICES
OPENING STATEMENT OF SENATOR HERB KOHL
Senator Kohl. We will come to order right now and start
this hearing.
Today's hearing will focus on the fiscal year 2012 budget
request of the Food and Drug Administration (FDA). We would
like to welcome Commissioner Hamburg, as well as Mr. Patrick
McGarey and Mr. Norris Cochran. It is very good to have you
guys here with us.
The FDA budget request for this fiscal year includes an
increase of $385 million, or 14 percent, more than the funding
level provided in fiscal year 2010. During a time when overall
Government spending is declining, this budget request is an
exception. Among other things, we are here to talk about why
this increase is necessary.
Some people have questioned the role of the FDA and the
growth of the agency's budget over the past several years.
These are fair and important questions. I have been and
continue to be a very strong supporter of the FDA. At the same
time, I understand how difficult it is to talk about deficit
reduction while at the same time defending such a large
increase in the budget. Justifying that increase, Dr. Hamburg,
is your task and it is not an easy one.
We have supported your work because we believe it is the
job of the Federal Government to make sure that our food and
drugs are safe, and we need to make sure that you have the
funding that you need to make that happen. This is not
something we can relegate to States, local government, or
private industry. The world and the way our food and drugs are
produced are becoming more complex every day, and it is
important for the FDA to have the ability to adapt to these
changes.
Every $1 that we spend in this bill must be questioned, of
course, defended, of course, and well thought out. The
administration has proposed to increase this budget while other
areas of the Government are being cut. I believe the FDA's
mission is critical to the safety of American families, but we
must be able to justify the budget increase at this time.
So, we are looking forward to hearing from you, and first
we will call on Senator Blunt.
STATEMENT OF SENATOR ROY BLUNT
Senator Blunt. Thank you, Chairman Kohl, for holding this
hearing on FDA and their budget request for fiscal year 2012. I
know you have been a knowledgeable advocate for this work and
look forward to your leadership on it.
I want to thank our witnesses for coming today as well.
The administration's request for FDA is an increase of 16
percent more than the current funding level, and if the budget
request is approved, the agency will grow by an astonishing 60
percent since fiscal year 2008. This is one of the largest
increases in the entire Department of Health and Human Services
(HHS) and it is a higher percentage increase than in almost any
agency in the U.S. Department of Agriculture (USDA).
As I mentioned at last week's hearing with Secretary
Vilsack and earlier this week in a meeting I am pleased the
Commissioner was able to have with me in anticipation of this
hearing, I am concerned about the fragmentation among the food
agency inspection services and hope we can look for ways to
streamline wherever we can. I think it was Einstein who said
everything should be as simple as possible but no simpler. So,
we do not want to streamline it to the point that it does not
work, but we do want to look for those efficiencies that we are
able to find. According to the Government Accountability Office
report released earlier this month, 15 Federal agencies are
responsible for oversight of 30 food-related laws. It is
important we look for ways to do what we can about duplication
where it occurs.
The recent outbreak of salmonella in eggs showcased this
fragmentation. Currently, the FDA has the responsibility of
ensuring the safety of shell eggs, yet USDA oversees eggs that
are processed into egg products. The Secretary himself used the
example of a pepperoni pizza that is under the jurisdiction of
one agency while cheese pizza is under the jurisdiction of
another.
With significant investments, Dr. Hamburg, comes
significant responsibility. I know you want your agency to be
accountable and we do too. We cannot look at this budget
without understanding that the Federal Government is borrowing
$4 billion every single day. Families all across America do not
understand why their Government cannot operate with the same
rules they face, and the Government must start living within
its means. So, I am looking forward to what we can do together
to address these issues.
As we tackle funding decisions this year, we have to be
mindful, of course, that the FDA touches the lives of every
American every day, and amazingly around 20 cents out of every
$1 spent in America is used to purchase an FDA-regulated
product. Americans expect these products to be safe and
effective. Dr. Hamburg, I look forward to working with you and
your team and certainly with Chairman Kohl as we move down the
path to doing the things that make the most sense for the job
you have to do.
And thank you, Chairman.
Senator Kohl. Thank you very much, Senator Blunt.
Commissioner Hamburg, we would love to hear from you.
SUMMARY STATEMENT OF DR. MARGARET A. HAMBURG
Dr. Hamburg. Thank you very much, Chairman Kohl, Ranking
Member Blunt, and distinguished members of this subcommittee. I
appreciate the opportunity to present the President's fiscal
year 2012 budget for FDA and our priorities for the coming
year.
This hearing comes at a critical time for our Nation and
for our agency. We must be prepared to meet and fully embrace
the scientific challenges and global realities of our modern
world, and the stakes for public health, for patients and
consumers, and for our economic health have never been higher.
Our agency is charged with an extremely significant task,
to promote and protect the health of the American people. This
includes ensuring the safety, effectiveness, and wholesomeness
of products that Americans rely on, as you noted, in
fundamental, sometimes lifesaving, ways--drugs, vaccines,
medical devices, our Nation's food supply, and more. But it
also includes working proactively to foster the scientific
innovation that will lead to tomorrow's new breakthrough
products. Both roles are essential to delivering progress for
the American people and both roles impact our economy by
encouraging consumer confidence, growing key industries, and
creating jobs.
Thanks to the support of the chairman and members of this
subcommittee, FDA has been able to make forward progress on a
wide range of vital priorities to improve the health, quality
of life, safety, and security of all Americans. With the
resources that you have appropriated, we have achieved tangible
benefits for the people that we all serve.
During the past year, we have approved dozens of new drugs,
vaccines for seasonal and pandemic flu, and medical devices for
hearing and vision loss, severe asthma, and to perform 3-D
mammography screening. We applied cutting-edge whole genome
sequencing to trace foodborne illness outbreaks. We have
launched a new system that identified 100 food safety problems
in the first months of operation. We have collaborated with the
National Oceanic and Atmospheric Administration to develop and
to perform screening tests to assure seafood safety and reopen
the gulf coast fisheries after the Deepwater Horizon oil spill.
Those are just a few of the things that the agency has
accomplished in the past year.
As you can see, FDA is charged with an enormous and unique
set of tasks, and if we do not do our job and do it fully,
there is no other agency or entity to backstop behind us. That
is why I am here to ask for your support of the fiscal year
2012 budget for the FDA.
The proposed budget includes $4.4 billion overall and
identifies four priority initiative areas: Transforming Food
Safety and Nutrition; Advancing Medical Countermeasures;
Protecting Patients; and Fostering FDA Regulatory Science and
Facilities.
Compared to the fiscal year 2010 budget, the fiscal year
2012 budget represents an increase of almost $1.1 billion, $382
million in budget authority, and $694 million in user fees. The
amount of user fees includes $60 million for three new user
fees that FDA is proposing.
In addition, in an effort to contribute to deficit
reduction, we will undertake nearly $30 million in contract and
administrative savings across the agency.
These four initiatives are critical to our mission of
protecting and promoting the health of the public and they also
represent important opportunities for our food and medical
product industries to grow and to strengthen our economy. In
other words, they will provide the significant return on
investment that we all are looking for, for products, for
people, and most importantly, for the public health. And let me
just quickly explain how.
First, the Transforming Food Safety and Nutrition
Initiative contains an increase of $326 million to build a
stronger, more reliable food safety system that will protect
American consumers. We will use these resources to aggressively
implement the Food Safety Modernization Act (FSMA) that the
Congress passed in December. This landmark legislation provides
FDA with the tools to establish a prevention-focused food
safety system, placing the primary responsibility for
prevention on the food producers and processors and leveraging
the valuable work of FDA's State and local partners. FDA will
also make sure that American families have the information that
they need to make more healthful food choices through menu and
vending machine labeling.
Second, for the Advancing Medical Countermeasures
Initiative, FDA proposes $70 million. Medical countermeasures
include drugs, vaccines, diagnostic tests, and other medical
equipment that are needed to detect and respond to deliberate
chemical, biological, radiological, and nuclear threats, as
well as emerging infectious diseases or other natural
disasters, all of which threaten the lives and safety of the
American people and I think weigh heavily on our minds right
now given the tragic events in Japan. This investment will help
accelerate the development of countermeasures to meet a set of
critical national security and public health needs.
Third, the Protecting Patients Initiative, for which we are
proposing an increase of $123.6 million, will allow FDA to
establish a pathway for approving lifesaving biosimilar
products. This could offer substantial savings for the Federal
Government and private-sector healthcare. This initiative also
includes investments in scientific tools and partnerships to
enhance the safety of increasingly complex drugs, medical
devices, and biologics, and an increasingly complex foreign and
domestic global supply chain.
Fourth, the FDA Regulatory Science and Facilities
Initiative contains an increase of $48.7 million to strengthen
the core regulatory scientific capacity that supports all of
FDA's missions and will enable us to truly streamline and
modernize our regulatory work by applying the best possible
science, especially as we address more advanced therapies,
complex devices, and emerging technologies. It will also allow
FDA to outfit and to occupy the Center for Biologics and Center
for Drugs Life Sciences-Biodefense Laboratory complex which
will play a critical role in shaping strategies in response to
pandemics, emerging infectious diseases, and deliberate
biological threats.
So, even in these difficult times, the FDA's fiscal year
2012 budget is essential to our ability to take meaningful,
science-based action on behalf of the American people. With
these investments and your support, I am confident that we can
build on our past successes and better ensure our Nation's
health.
Thank you for the opportunity to testify and I am happy to
answer your questions.
[The statement follows:]
Prepared Statement of Dr. Margaret A. Hamburg
introduction
Chairman Kohl, Ranking Member Blunt, and members of the
subcommittee, I am Dr. Margaret A. Hamburg, Commissioner of the Food
and Drug Administration (FDA). I am pleased to present the President's
fiscal year 2012 budget request for FDA.
For today's hearing, I am joined by Patrick McGarey, FDA's
Assistant Commissioner for Budget and Norris Cochran, Deputy Assistant
Secretary for Budget at the Department of Health and Human Services
(HHS).
In my testimony today, I will outline the important initiatives in
FDA's fiscal year 2012 budget request to the Congress. My testimony
also highlights FDA's unique role in protecting public health and the
value that FDA delivers for American taxpayers.
unique role of fda
FDA is charged with ensuring the safety, effectiveness, and
wholesomeness of products that Americans rely on in fundamental,
sometimes lifesaving, ways--drugs, vaccines, medical devices, our
Nation's food supply, and more. These are products that people need;
products they care about; and products that are critical to their
health, safety, and well-being. Our role is unique and if we don't do
our job completely and responsibly, there is simply no other agency or
entity to backstop us.
Fulfilling our mission--to promote and protect the public health--
is a difficult task under any circumstances. But these are especially
challenging times. Today, the powerful forces of globalization are
reshaping our world. We face complex threats--both accidental and
deliberate--that pose new risks to FDA-regulated products and the
Americans who rely on them. And we have been forced to rethink the way
we do our job.
But we also live in a time of great advances in science and
technology. Breakthroughs in the life sciences have provided industry
with new opportunities to invest, innovate, create new markets,
strengthen our economy, and most important, deliver new products and
benefits for the American people.
fda innovation, accountability, and results
My dedicated colleagues at the FDA are deeply committed to the
health of American patients and consumers--and they recognize that
innovation is essential to progress in public health.
Innovation is the foundation of the successful industries we
regulate, and innovation is responsible for remarkable advances across
all of the product areas within FDA's jurisdiction--which is why we
must work proactively to foster the scientific innovation that will
lead to tomorrow's breakthrough products.
Innovation is also critical to maintaining U.S. global leadership
in many areas, including medical product development. Currently, most
new drugs are approved in the United States before they are approved in
Europe. And according to a recent industry study, we either are ahead
of or tied with Europe for approval of medical devices that fall into
the lower-risk category, which represents 90 percent of medical
devices.
In my testimony, I highlight some recent FDA actions that allow the
food, drug, biologic, and device industries--all engines of
innovation--to bring new products and technologies to market.
We also recognize that just as FDA supports the ability of industry
to innovate, FDA itself must innovate and become more efficient. In
FDA's fiscal year 2012 budget, we highlight more than 100 examples in
which FDA centers and offices are improving the efficiency of our
programs, and in many of these examples, we are also supporting
industry efforts to develop new products. Examples of FDA innovation
include the recent launch of the Innovation Pathway, a program to
stimulate new, breakthrough technology and advances for medical device
manufacturers, as well as a scientific collaboration with industry to
develop novel technologies to detect new and traditional foodborne
contaminants and to develop safe food packaging. These efforts reduce
the risk and expense of recalling products that fail to meet safety
standards.
FDA is also committed to accountability. During the past year, we
developed and implemented FDA-TRACK, an agency-wide system to monitor
key performance measures for more than 90 FDA programs. Through FDA-
TRACK, we are systematically monitoring FDA's progress as we work to
achieve our performance measures and allowing stakeholders and the
public to witness our progress through quarterly reports that we post
on www.FDA.gov.
But the best measure of the value that FDA delivers is the
opportunity to reduce costs and achieve measurable savings in areas
that are important to America's health. One example is FDA support for
the generic drug industry, which markets drugs that save American
patients and taxpayers $140 billion per year.
A second example is FDA's food safety program, which is making
significant progress to reduce foodborne illness that costs the U.S.
healthcare system $88 billion annually. A third example is the fiscal
year 2012 Generic Biologics Initiative, which will generate significant
savings for the Federal Government and for private-sector health plans.
fda accomplishments
Thanks to the support of this subcommittee, FDA continues to
achieve important public health milestones. Since early 2010, FDA has
supported industry efforts to bring new products and technologies to
market--and to think creatively about how to promote and protect the
health of the American people in meaningful and sustainable ways.
During the past year, FDA:
--approved new drugs to treat diabetes, hypertension, osteoporosis,
bacterial infections, chronic pain, rheumatoid arthritis,
preterm birth, gout, immune deficiencies, schizophrenia, major
depressive disorder, and pulmonary disease;
--approved five new therapies to treat rare diseases;
--conducted four workshops to stimulate new orphan drug development;
--tentatively approved the 126th anti-retroviral drug under the
President's Emergency Plan for AIDS Relief;
--approved vaccines for seasonal and pandemic influenza;
--approved new donor screening tests for HIV and Chagas disease;
--cleared a new test to support kidney transplant patients;
--approved new medical devices to treat hearing loss, severe asthma,
and vision loss, and to perform 3-D mammography screening;
--cleared technology for physicians to view diagnostic images on
iPhones and iPads;
--identified measures to prevent radiation overdoses during computed
tomography scanning;
--permitted the marketing of the first test to identify norovirus, a
common foodborne illness;
--applied genome sequencing to trace foodborne illness outbreaks;
--collaborated with the National Oceanic and Atmospheric
Administration to develop tests to re-open gulf coast
fisheries;
--formed public-private partnerships to improve produce safety; and
--launched a new system that identified 100 food safety problems in
first 7 months of operation.
fiscal year 2012 budget summary
Although the President emphasized in his fiscal year 2012 budget
message that the fiscal realities we face require ``hard choices,'' the
5-year freeze on Federal spending announced in the fiscal year 2012
budget is not an across-the-board cut. Although the overall budget
represents a freeze in the aggregate, it also contains investments in
areas critical to sustain and grow the American economy.
FDA is one such area of critical investment. As you can see from
FDA's fiscal year 2012 priorities--food safety and nutrition, medical
countermeasures (MCMs), patient safety, and FDA regulatory science--an
investment in FDA is an investment in the economic health of two of the
largest segments of America's economy: our food and medical products
industries.
Our fiscal year 2012 budget is also an investment in health--in the
health of individuals and the public health of our Nation. As a result,
the budget includes $4.4 billion in budget authority and user fees to
protect and promote the health of the American public every day, and
through every stage of life.
contract and administrative savings
Although FDA's fiscal year 2012 budget is an overall increase for
FDA, it also contains savings that contribute to the administration's
deficit reduction goals. FDA is proposing $29.7 million in contract and
administrative savings designed to achieve reductions and cut costs
across all FDA program areas.
To achieve these savings, FDA will reduce administrative staff by
46 full-time equivalents, lower contract costs by increasing
competition, and expand the use of blanket purchase agreements and
other agency-wide approaches to reduce contract costs. Where possible,
we will also save by using technology to improve how we manage our
contracts and the contracting process. Finally, in some program areas,
FDA will reduce the cost of employee training by replacing the
traditional classroom model with online training.
transforming food safety and nutrition
For fiscal year 2012, FDA proposes an increase of $326 million for
the Transforming Food Safety and Nutrition Initiative to build a
stronger, more reliable food safety system that will protect American
consumers. This increase includes $225.8 million in budget authority
and $100.2 million for user fees, including the four new user fees
enacted in the FDA Food Safety Modernization Act (FSMA).
With this increase, FDA will begin to implement the landmark food
safety legislation, which the Congress enacted last December. Under
this initiative, FDA will also ensure--through menu and vending machine
labeling--that American families have the information they need to make
more healthful food choices.
FDA Food Safety Investment.--The passage of FDA FSMA, the first
major overhaul of our food safety law in more than 70 years, will
transform FDA's food safety program. Through FFSMA, the Congress
enacted new safeguards and enhanced tools to protect America's food
supply by preventing food safety problems rather than reacting to
problems after they occur.
Regrettably, foodborne illness is pervasive across America. Each
year, nearly one of every six Americans gets sick due to foodborne
illness. Some cases are severe--128,000 require hospitalization, and
3,000 Americans die from foodborne illness.
FFSMA closes significant and longstanding gaps in FDA's food safety
authority. For example, FFSMA gives FDA important new tools to ensure
that imported foods are as safe as domestic foods and directs FDA to
build an integrated national food safety system in partnership with
State, local, and tribal authorities.
FDA will use these resources to establish a prevention-focused food
safety system that leverages the valuable work of FDA's State and local
food safety partners. In addition to yielding profound public health
benefits, the FFSMA focus on prevention offers the opportunity for a
dramatic return on the resources that this subcommittee invests in food
safety. According to recent studies and the latest estimates of
foodborne illness, the healthcare cost of foodborne illness--not
including costs to the food industry--exceeds $88 billion each year.
The combined result of these actions will be a stronger, more
reliable food safety system that protects the American people.
In its fiscal year 2012 budget, FDA is organizing its food and
animal feed safety programs and investments to implement FFSMA. Our
detailed budget documents display the specific dollar amounts that FDA
will allocate to implement the 22 separate sections of the law.
Nutrition.--As part of the Transforming Food Safety and Nutrition
Initiative, FDA will also begin an $8.8 million program to improve
nutrition labeling on restaurant menus and vending machines so that
consumers can adopt healthier diets. This small but significant
initiative offers powerful return on investment. A fiscal year 2009
analysis estimated the medical costs of obesity at $147 billion per
year (Finkelstein, et al., Health Affairs), which means that
controlling obesity goes hand-in-hand with controlling healthcare costs
and reducing a significant burden on our economy.
The investments in this initiative will empower consumers to make
better nutritional choices and will motivate food producers to develop
healthier foods.
advancing medical countermeasures
For fiscal year 2012, FDA proposes $70 million for the Advancing
MCMs Initiative. MCMs include drugs, vaccines, diagnostic tests, and
medical equipment and supplies to respond to deliberate chemical,
biological, radiological, and nuclear (CBRN) threats and emerging
infectious diseases, such as pandemic influenza.
The Advancing MCM Initiative will strengthen FDA's ability to
respond to these national security threats by supporting the
development of MCMs as well as enhancing review by allowing FDA to work
interactively with product developers and Government partners from
early in the development process. With this investment, FDA will be
better able to anticipate and resolve bottlenecks in MCM development
and accelerate development of MCM products for pressing public health
and national security needs.
MCM Gap.--Today, our Nation lacks the range of MCMs required for
emergency response. For example, there are no countermeasures to treat
acute radiation syndrome, which would afflict millions in the aftermath
of a nuclear event.
Moreover, no FDA-cleared, rapid, point-of-care diagnostics exist
for any of the biothreat agents of greatest concern. Such diagnostic
tests are essential to guiding the public health response; ensuring
that patients receive the most appropriate treatment; and promoting
appropriate use of the limited supplies of MCMs available during a
public health emergency.
Analysis of the Need for MCMs.--In December 2009, on the heels of
the influenza pandemic, HHS Secretary Sebelius called for a
comprehensive review of the Nation's readiness to defend against CBRN
threats. The HHS review was prompted by recognition that influenza
vaccine became available only after pandemic influenza was already
widespread across the United States. The HHS review called on the
expertise of the scientific leadership of all Federal agencies that
work with MCMs, as well as State and local health departments, the
National Biodefense Science Board, and the Institute of Medicine.
The review, released on August 19, 2010, identified the barriers to
MCM development as well as significant opportunities to improve the
path for successful MCM development. The review identified FDA as
critical to the success of the MCM Enterprise, primarily because FDA
evaluation of product safety and efficacy can significantly affect the
course of product development.
The report further recognized that robust FDA engagement from the
earliest stages of product development can substantially increase the
odds of successful approval. In other words, increased support for
FDA's MCM activities is one of the most critical steps the Federal
Government could take to transform the larger MCM Enterprise.
Threat Assessment.--Dozens of reports since September 2001 and the
October 2001 anthrax attack have affirmed the risk of terrorist groups
wielding biological weapons and the suffering, death, and social and
economic disruption that would result in the case of an attack.
Therefore, the fiscal year 2012 investment in FDA medical
countermeasure development and review offers the potential for a strong
return on investment.
The analysis of the National Security Strategy warns that the
effective dissemination of a lethal biological agent within a U.S.
population center would endanger the lives of hundreds of thousands of
people and have unprecedented economic, social, and political
consequences. The National Security Council warned in 2009 that the
economic cost of a well-executed bioterrorist attack on American soil
could exceed $1 trillion.
Clearly, such an attack would have profound consequences on our
social and political order, and more broadly, our way of life. Without
this investment, America's public health and national security will
continue to be at risk.
protecting patients
For fiscal year 2012, FDA proposes an increase of $123.6 million
for the Protecting Patients Initiative. This increase includes $64.8
million in budget authority and $58.8 million from three new user fees.
FDA is proposing new fees for reviewing generic drug applications,
paying the cost of medical product reinspections, and inspecting
imports that arrive by international courier.
Generic Biologics.--With the fiscal year 2012 increase in budget
authority, FDA will establish a pathway for approving generic
biologics. Generic biologics are biological drugs shown to be highly
similar to an FDA-approved biological product. In some cases, generic
biologics may also be interchangeable with the FDA-approved biological
product.
Biological products include therapies to treat certain cancers,
rheumatoid arthritis, age-related macular degeneration, and HIV. These
therapies cost $15,000 to $150,000 or more per patient per year--and
represent a significant share of Federal Government and private-sector
pharmaceutical costs.
Approving biosimilar versions of these products offers the
potential for substantial savings for the Federal Government and
private-sector health plans. However, these savings will not
materialize unless FDA has the resources to implement a clear
regulatory pathway for approving generic biologics. FDA is requesting
these funds for fiscal year 2012 because the sooner we make this
investment the sooner we will see savings from generic biologics.
Other Medical Products.--In addition to investing in generic
biologics, the Protecting Patients Initiative also invests in new
scientific tools and partnerships to enhance the safety of increasingly
complex drugs, medical devices, vaccines, and other biological
products. For example, the Protecting Patients Initiative will
strengthen FDA efforts to modernize and improve safety throughout the
supply chain of medical products at a time when the number of medical
products manufactured abroad is increasing dramatically, which presents
real challenges for medical product and manufacturing safety.
Safer medical products not only benefit patients, but also benefit
the manufacturers of drugs, biologics, and medical devices. Safer
products reduce healthcare costs and allow manufacturers to avoid the
expense of product recalls.
With the resources in this initiative, FDA will modernize its
approach to ensure safety across the supply chain for medical products.
The initiative will also expand FDA's capacity to conduct medical
product safety assessments and strengthen the safety of vaccines and
the blood supply.
The proposals in this initiative offer a high rate of return for
the investment of Federal dollars. They can reduce the cost of care and
promote safe, high-quality, and accessible healthcare that Americans
deserve. In addition, the administration is proposing additional
measures for fiscal year 2012 designed to reduce costs and increase the
availability of generic drugs and biologics.
fda regulatory science and facilities
For fiscal year 2012, FDA proposes an increase of $48.7 million for
the FDA Regulatory Science and Facilities Initiative.
The FDA Regulatory Science and Facilities Initiative will
strengthen the core regulatory scientific capacity that supports all
elements of the FDA mission. Regulatory science focuses on developing
the knowledge and tools to properly assess the safety, effectiveness
and quality of products that are being developed or are already on the
market. Specifically, this initiative will help modernize and
streamline the regulatory pathways that industry relies on to bring
new, innovative products to market.
It will also modernize the FDA review and approval process for
products that rely on new and emerging technologies. The result will be
promising new opportunities to diagnose, treat, cure, and prevent
disease.
Finally, the resources in this initiative will also allow FDA to
outfit the Center for Biologics Evaluation and Research-Center for Drug
Evaluation and Research Life Sciences-Biodefense Laboratory complex. On
August 18, 2010, the General Services Administration awarded the
construction contract for the new laboratory complex at White Oak, and
construction work is currently underway. Without this investment, FDA
must pay double the rent: the first for a new lab we cannot occupy and
second for the old lab we cannot vacate.
The new laboratory complex will help FDA fulfill our scientific
responsibilities to promote drug and biologic safety and MCM
development and prevent threats, including annual influenza. FDA must
make this investment in fiscal year 2012 to ensure that the laboratory
is operational and ready for occupancy in fiscal year 2014.
fda current law user fees
For fiscal year 2012, FDA proposes an increase of $634.5 million
for 12 current law user fee programs.
FDA user fee programs support safety and effectiveness reviews of
human and animal drugs, biological products, medical devices, and other
FDA-regulated products. Fees also allow FDA programs to achieve timely
and enhanced premarket review performance. Finally, fees support the
programs and operations of the FDA Center for Tobacco Products.
Existing user fee laws authorize fee increases for many FDA user
fee programs. The increases expand the available options for treating
and curing diseases and addressing other important public health needs.
conclusion
The FDA budget for fiscal year 2012 contains important investments
for critical public health priorities. With these resources, FDA will
transform food safety; support the development of urgently needed MCMs;
protect patients by assuring that the drugs and other medical products
they rely on are safe; and advance regulatory science, which serves as
the foundation for all science-based decisions at FDA.
Thank you for the opportunity to testify. I am happy to answer your
questions.
Senator Kohl. Thank you very much, Dr. Hamburg. We will now
embark on a round of questions from the panel.
FOOD AND DRUG SUPPLY
Your statement highlights what FDA can do with additional
funding, but what happens if you do not get the full amount you
are asking for like, for example, can you still tell us that
you will be able to ensure a safe food and drug supply with
your present budget?
Dr. Hamburg. Well, as you know, FSMA, which just went into
law, gives us a historic opportunity to really transform the
food safety system in our country into one based on prevention
and one that will really make a difference in preventing costs
in terms of illness and death of people, consumers, and
preventable costs to our healthcare system and to the food
industry.
If we cannot get additional resources to support the
implementation of this bill, we will, of course, continue to
pursue important aspects of what is contained in that
legislation, but we will only really be able to put forward
regs. We will be able to put ideas and programs on paper, but
we will not be able to fully implement all that needs to be
done. We will not be able to pursue the ambitious inspection
program domestically and internationally that enables us to
have a hands-on look at how food production and processing is
being done to ensure safety.
Importantly, we will not be able to work with manufacturers
and producers to really put in place the prevention-based
strategies, the risk-based approaches that are really so vital
to what we need to be doing so that we are not scrambling after
outbreaks occur but actually preventing them in the first
place. That will save lives. That will save money.
And we will not be able to address the increasing challenge
of import safety. More and more of the food we eat in this
country is actually grown, produced, manufactured, distributed
overseas in an increasingly complex supply chain, and we really
have a responsibility to enhance our efforts to ensure the
safety of that global food supply as well.
And at the end of the day, it is very, very important to
industry that we have and maintain the reputation of a strong
food supply. We do, at the present time, have one of the
strongest food safety systems in the world. That is very, very
important. It matters to people and it matters to the health of
the industry, their ability to have markets that people have
confidence here at home, and export markets depend on the
confidence of the public at large in the work of the FDA
working with industry.
MEDICAL COUNTERMEASURES
Senator Kohl. The budget for fiscal year 2012, Commissioner
Hamburg, proposes an increase of $70 million to help develop
new therapies that could be quickly used in the event of a
chemical or biological attack or a natural disaster of another
sort. The tragedy in Japan where they are confronting so many
challenges right now including, of course, radiation exposure,
does focus our attention on the importance of preparedness.
Can you tell us a little bit about this initiative of
yours? What will we be getting with this investment? What can
we tell the American people about our present state of
preparedness with respect to something comparable to what
happened in Japan?
Dr. Hamburg. This is a very important initiative, and as
you say, it is underscored by recent events. As a Nation, we
must be prepared and we must be resilient in the face of a
range of potential threats, both naturally occurring and
deliberately caused. And at the present time, we have more work
to do, and this Medical Countermeasures Initiative at FDA is
part of a broader administration-wide initiative to ensure that
we as a Nation are prepared for the kinds of potential threats
to our Nation's security that can occur.
If we cannot move forward with this Medical Countermeasures
Initiative, we will not be able to ensure that we have the
drugs, the vaccines, the diagnostics, the medical equipment
that is necessary to respond to an event. We need to be
developing, for example, with respect to radiation safety,
state-of-the-art therapies that will enable us to treat both
acute radiation syndrome, such as, sadly, workers in the
nuclear plant in Japan are potentially being exposed to, and
other forms of radiologic exposures, both the threat of a dirty
bomb or an intentional nuclear event, or a catastrophic,
unexpected event, such as what has occurred in Japan.
RADIATION PREPAREDNESS
Senator Kohl. Are we prepared at this time to deal with the
fallout of a nuclear meltdown such as they have had in Japan?
Are we prepared?
Dr. Hamburg. There are many aspects of preparedness, and
actually FDA is involved in a number of them. There is the
issue of ensuring that any imported products from Japan are
screened and safe for consumption, and we are actively involved
in addressing that. At the moment, there are not imports from
that region coming in.
Senator Kohl. I was referring to something akin to what
happened in Japan. Are we prepared today to deal with it here
in the United States?
Dr. Hamburg. Oh, an event in--you know, we have many
systems of preparedness in place, but we are lacking some
critical elements of preparedness, including these important
medical countermeasures. We need to make sure that we have the
medical treatments necessary. We do not have treatments for
acute radiation sickness. We need to develop those treatments
and we need to make sure that they are available for the
American people and potentially available for people around the
world.
Senator Kohl. Before I turn this over to Senator Blunt, I
believe I hear you saying that we could not assure the American
people here today that in the event of something similar to
what happened in Japan, we would be in a position to take care
of the needs of the people in the areas where the nuclear
disaster occurred. We are not prepared to take care of them.
Dr. Hamburg. We have systems for response and we have some
acute measures that we could provide, but we do not have, for
example, as I said, the treatment of acute radiation sickness
that we would need to be able to benefit people exposed to very
high levels of radiation exposure. We do not have the
treatments to address a range of potential nuclear exposures.
We would be able, in the case of a nuclear reactor event, to
provide potassium iodide for limited protection of the thyroid
organ. There are other potential exposures, and we are working
to develop, as a Government, interventions that will make a
difference.
But we need to make targeted investments today to be
prepared for tomorrow. That is what this Medical
Countermeasures Initiative is about. In the field of radiation
exposure absolutely, yes, we have other gaps in preparedness
that we need to address whether it is naturally occurring
infectious disease threats or the potential for biological,
chemical, nuclear terrorism. We really have a responsibility to
make sure that we make these investments today, and I think it
is something that we all, for our Nation's security, need to
work on together.
Senator Kohl. Senator Blunt.
RADIATION TREATMENTS
Senator Blunt. Thank you, Chairman.
Commissioner, are you saying on this area of radiation
problems, that we do not have a stockpile of the treatments or
that the treatments do not exist?
Dr. Hamburg. The treatments do not exist for many aspects
of radiation exposure.
Senator Blunt. And are you saying that under this program
you are talking about, one of the FDA's goals would be to
develop those treatments?
Dr. Hamburg. Would be to work with industry and Government
scientists to, yes, develop and also to get them reviewed and
approved for safety and effectiveness so that they could be
available to the American people.
RESPONSIBILITY DUPLICATION
Senator Blunt. Well, I am going to get to review and
approval here in 1 minute. Let me go through things with some
quickness, if I can.
On the duplication issues that I talked about earlier and
that we talked about the other day, is there any ongoing effort
in the food and drug safety agencies to try to figure out how
we can do that in a more focused way?
Dr. Hamburg. It is an important area of focus. Soon after
the President was inaugurated, he initiated the Food Safety
Working Group to bring together the different agencies of the
Federal Government that have responsibilities for food to
really look at how they could coordinate better and to develop
key cross-cutting strategic priorities as well.
It is the case that FDA and USDA have the major
responsibilities for food safety in this country, and we, of
course, do work closely together and we are examining ways to
work more closely going forward. Certainly, in FSMA
implementation, we are working closely with USDA in order to
take advantage of their expertise and experience working in
farming communities, to take advantage of the resources that
they already have on the ground. We are also talking with them
about how to more effectively share information around
inspections and other food safety-related activities.
The partnership is also very important, and the integration
working with State and local authorities as well, and that is
an important component of FSMA, and it is a very important
component of how we do business and need to do business more
efficiently going forward.
Within the FDA itself, we have looked hard at how to make
our work more efficient and integrated as well because we had
components of the FDA working on food safety issues and we have
now created an Office of Foods with a Deputy for Foods in
charge of all of those activities and are integrating our food
safety activities across both the human and the animal food
safety arenas to make our program more robust, more integrated,
and more efficient. And there is lots more work to be done.
FOOD SAFETY MODERNIZATION ACT
Senator Blunt. Well, I encourage you to pursue all of that
work as vigorously as we can. We need to be able to defend the
things we do and to argue with justification that we are trying
to do those things better and not duplicate our effort.
On the duplication of effort, one of my big concerns about
FSMA was yet another on-farm presence of another Government
regulator. What are you doing there, as you look at those new
responsibilities, and are you working with agencies like USDA
that are already there to see how you can work with the
information and structure they have?
Dr. Hamburg. Yes. No, very much so. We have been working
hard to really make sure that we understand the challenges and
the concerns of the farming community as we move towards
implementing FSMA. We, of course, have been on farms in the
past when there are food-borne outbreaks around BSE issues and
tissue residue issues. So, it is not completely new territory
to us. But we recognize that we are now undertaking a new set
of roles and it is very important that we work constructively
with the farming community and with other partners that
interact with the farming community.
I have been out to visit quite a number of farms and my
Deputy for Foods even more, have learned a lot about the full
range of different types of farms and their different issues
and have listened hard and will continue to try to work with
the farming community. And USDA has been very helpful to us and
the Extension Service is a critical component of our ability to
do outreach to farmers and to consumers.
We recognize that nobody wants more people in their farming
communities telling them what to do. We view this as a
collaboration. We view this as an opportunity for us to pursue
a common goal of ensuring that the food supply is safe, doing
what I think every farmer and food producer wants to be able to
do, which is to make sure that the food they produce is safe
and wholesome and that consumers can count on it and trust it.
FOOD TRACEABILITY
Senator Blunt. And do you have new responsibilities for
food traceability in this law?
Dr. Hamburg. It is an important component of what we need
to do as part of FSMA, and it will certainly prove to be of
value if we can put that kind of a program in place because it
will enable much more rapid identification of a problem and its
source when it should occur so that we can identify and respond
rapidly, control the problem, and mitigate the effects, and get
those companies back up and running, producing the food with a
robust market for the food that they produce.
Senator Blunt. Would that be across the board? This is a
question I do not know the answer to. Is that across the board
for your agency? Does that include livestock as well?
Dr. Hamburg. No. We regulate about 80 percent of the food
supply, but we are not responsible for meat, poultry, processed
eggs, and catfish.
Senator Blunt. And particularly catfish.
Dr. Hamburg. Right.
Senator Blunt. Mr. Cochran will be glad to know that you
are not going to get involved in catfish. Probably Mr. Pryor as
well.
But you will have new traceability requirements or
obligations on the things you do regulate on the farm.
Dr. Hamburg. We are going to be starting to have those
discussions about what such a system should look like. Industry
has an important voice and a lot of experience in these issues
because it is so important in terms of being able to rapidly
identify problems and address them.
REVIEW PROCESS
Senator Blunt. Let me ask just a couple of quick questions
on review processes, particularly since you mentioned you might
have some other ways to try to get these products that Chairman
Kohl was talking about to the market quicker.
USER FEE REVIEWS
Two of your largest fee programs, prescription drugs and
medical device review, are up for reauthorization in this
fiscal year. How do you intend to approach those fee
negotiations with industry?
Dr. Hamburg. Well, these are very important activities, and
the user fee programs that were introduced in the 1990s have
demonstrated their value on the drug side and on the device
side in terms of helping to give us the resources that we need
to be able to ensure the best possible review in the most
timely way possible. The negotiations are underway. We have
actually just begun negotiations with the generic industry as
well, which currently does not have user fees. We are
optimistic that we are going to be able to achieve a good
proposal for the next user fee legislation that will come
before you. And I think both the industries we regulate that
provide user fees and certainly our agency feel that these are
critical programs that help to enable us to be able to do our
job. And I think that overall we have been performing well in
response to the introduction of the user fees and meeting the
targeted goals both on the drug side and the device side.
Senator Blunt. I do not know what the fiscal year 2010
numbers were. I think the fiscal year 2009 numbers--and
clearly, this is the first 9 months of this administration, so
numbers that may be even less than fiscal year 2009. But I
think in fiscal year 2009, the agency failed to meet one-third
of its drug review goals and approximately 20 percent of its
device review goals.
Dr. Hamburg. Well, those are different numbers than I have
seen. On the drug side, it is the case that in recent years we
have not met all of the goals, although in the first 15 years
of the program, we met and surpassed the goals. In 2007, the
FDA Amendments Act (FDAAA), gave FDA quite a comprehensive set
of additional new responsibilities mainly focused on drug
safety, and it is the case because our resources are fairly
limited, we had to target resources that might have gone into
drug review into responding and implementing the requirements
of this new and important Amendments Act. So, we saw some drop-
off in our review times as we began to implement those
components of FDAAA. We are getting right back up to the
performance levels prior to that though. But we have had a lag.
That is true.
On the device side, most of the device program is focused
on the premarket notification program, what is called the
510(k) process. About 95 percent, I think, of the devices that
we review are part of that program. And we have been meeting
the targets agreed to with industry in that program.
Senator Blunt. And they should expect you to do that.
Dr. Hamburg. And they should expect us to do that.
In the premarket approval area, which is a more rigorous
approval mechanism and has more requirements, we can and will
do better. We have put forward, under the leadership of our new
center director, Dr. Jeffrey Shuren--he has led a very serious
review of our regulatory pathways, how we can make them more
effective and efficient, how we can bring the best possible
science to bear. He put forward in January of this year 25
recommendations that reflected a lot of public comment,
discussions with industry, stakeholders, patient advocates, and
others. He put forward these 25 recommendations for how we can
do better.
We have also asked the Institute of Medicine of the
National Academies of Sciences to take a look at some of the
regulatory issues in the device area to make broader
recommendations about how we can modernize and improve our
regulatory pathways.
Senator Blunt. Good.
Dr. Hamburg. So, we want to keep working on it.
Senator Blunt. if my figures are wrong here, would you
please get back to me and let me know? But my notes here
indicate that FDA failed to meet one-third of the drug review
goals and approximately one-fifth of the device review goals.
And if that is not right, just tell me at some future time.
Dr. Hamburg. We will get back to you.
[The information follows:]
Drug and Device Review Goals
In fiscal year 2008, we met or exceeded the 90-percent performance
levels for 33 percent--or 4 of 12 goals--of the drug review performance
goals. In fiscal year 2009, we demonstrated significant improvement in
regaining stability in meeting our performance goals and met or
exceeded the 90-percent performance levels for almost 60 percent--or 7
of 12 goals--of the drug review performance goals.
The Food and Drug Administration (FDA) agreed to more stringent
device performance goals as part of the Medical Device User Fee
Amendments of 2007, also known as MDUFA II. For fiscal year 2009, FDA
is on track to meet or exceed 7 out of 10 device performance goals for
which we have reportable results, including the goals relating to
510(k) devices, which represent more than 90 percent of the devices FDA
clears or approves for marketing. The goals not met by FDA in fiscal
year 2009 represent less than 3 percent of the submission volume FDA
reviews, and performance has been steadily improving for these goals.
The Center for Devices and Radiological Health has undertaken a number
of steps to continue making improvements towards meeting these goals,
including drafting clinical trial guidance, identifying, and recruiting
needed staff expertise, strengthening its external experts program, and
improving its premarket information management systems.
Senator Blunt. I would also be pleased to see the numbers
for fiscal year 2010, if they are available now, the data that
ended September 30.
[The information follows:]
Fiscal Year 2010 Drug and Device Reviews
It is too early to determine the overall performance for fiscal
year 2010, given the current number of pending applications. While drug
review performance numbers for fiscal year 2010 are still preliminary,
it appears that the Food and Drug Administration (FDA) is on track to
meet or exceed 11 of the 12 drug review performance goals called for
under the Prescription Drug User Fee Act. Preliminary data as of the
fiscal year 2010 Medical Device User Fee Amendments of 2007 performance
report indicates that FDA is meeting or exceeding 5 of the goals for
which there are sufficient results to reliably estimate current
performance, and has the potential to meet or exceed all 12 performance
goals.
Senator Blunt. I have got a couple other questions, but I
think I will try to do those a little later, chairman, and let
others ask questions. Thank you.
Senator Kohl. Thank you.
Senator Brown for 5 minutes.
MAKENA
Senator Brown. Thank you, Mr. Chairman. I will take less
time. My Governor from Ohio is coming in and I have a meeting
with him in a few minutes.
But just one brief line of questioning, Dr. Hamburg. And
thank you for joining us.
As you know, after the FDA-approved Makena, which was the
version of a longstanding medicine that had been produced by
compounding pharmacies for years given to women who were at
high-risk of low birth weight, early birth babies, K-V
Pharmaceutical announced that the price for the product would
jump from about $10 to $20 per injection and typically a woman
would take 20 doses of it, I guess, over 20 weeks. It would
jump from $10 to $20 per injection to $1,500 per injection,
which by my calculations is from $10 to $1,500 is a 14,900-
percent increase.
Since the drug plays such a critical role in reducing the
incidence of premature birth and the associated deaths and
disabilities and costs, this price increase marks a dramatic
setback for public health, to insurance carriers, to
businesses, to taxpayers, to anyone and to the individuals
trying to pay them going from $10 times 20 injections to $1,500
times 20 injections.
What can the FDA do to stop manufacturers from exploiting
this existing approval process? Even though K-V has admitted
that the price increase does not derive from R&D or from
production costs, all they did was--my understanding--they say,
pay $200 million for the clinical trials, but they did not do
the R&D. In fact, taxpayers did most of the R&D here. So,
taxpayers, in the end, get a good drug, but it looks a lot like
blackmail to me. Seat belts serve an important purpose too, but
they are not priced in the stratosphere to reflect the fact
they save lives. But they are pricing it in a way that they
will make huge profits and it will compromise the public
health.
What can you do? Administrative, legislative strategies?
What do we do about a drug that has been used for decades and
prevented an awful lot of low birth weight baby births and
instead will become so, so, so prohibitively expensive?
Dr. Hamburg. Well, it is such an important concern, and
like you, I was very surprised when I learned about the price
increase. I think it is important and an advance that we have
an FDA-approved drug to prevent preterm pregnancy and all of
its consequent serious medical concerns for both mother and
infant. And while the drug had been available through
compounding, compounding as a practice has been associated with
serious health risks, contamination----
Senator Brown. I am not in any way questioning that FDA did
the right thing here. But my understanding is under Bayh-Dole
enacted decades--three decades--25, however many years ago, I
think in the 1980s. Under Bayh-Dole, you in fact do have the
power to do something about this price and do something about
K-V Pharmaceutical's actions. And if you do not, it is so
important that we figure out something to do here.
This price increase in my understanding started this week,
and it is only going to get worse. And if K-V is not willing to
back down, I would hope the embarrassment of doing this to
America's families would cause them to want to back down, at
least try to price it a little more reasonably. But if you
cannot use Bayh-Dole, you need to figure out a strategy what to
do here.
Dr. Hamburg. I am not as expert on these issues as I
perhaps should be. I am told that Bayh-Dole does not fall under
FDA's jurisdiction.
Senator Brown. It is HHS with Bayh-Dole. You are suggesting
that to them. You are writing a letter. You are weighing in
with them, as we are doing and some other Senators are starting
to now, as we worked on this.
Dr. Hamburg. This is an issue that, as you know, has arisen
recently. It did come as a surprise to us, very surprising,
especially in that the National Institutes of Health, as you
indicated, did the original clinical trials on which this
approval was based. I think it is a very important issue to
raise. FDA does not make its approval decisions with pricing
considerations.
Senator Brown. Nor should you.
Dr. Hamburg. So, I think our role is a different one, but I
think that the issue that you are raising about the
accessibility to this important drug is a critical one.
Senator Brown. I made clear I am not blaming FDA. FDA did
the right thing. This company acted I guess you cannot say
criminally, but immorally and any other string of adverbs you
might want to choose. I am just looking for FDA to take
leadership with HHS in finding a way, a strategy, or a path
quickly to get this company to price its drug more reasonably
for American women. Fair enough. Thank you.
Dr. Hamburg. Thank you.
Senator Kohl. Thank you very much, Senator Brown.
Senator Moran.
FOOD FROM THE FARM
Senator Moran. Chairman Kohl, thank you very much.
Thank you, Dr. Hamburg, for joining us.
In a broad sense, I was pleased to hear you indicate that
you are working to understand the challenges of the farm
community. In a broad sense, a broad question that I would ask
you is what does that mean within FDA. Have you hired people as
a result of the passage of the legislation who have farm
experience--agronomists, actual farmers, or ranchers who
produce food for our country?
LIVESTOCK ANTIBIOTICS
And then in a very narrower, more specific way, I want to
raise concerns that I have raised previously in regard to your
draft guidance No. 209 issued June 28, 2010, ``The Judicious
Use of Medically Important Antimicrobial Drug in Food-
Processing Animals.'' We are very much a livestock-producing
State, and I generally would tend to avoid commenting on what I
would hope would be scientific-based decisions by FDA, but I
continue to raise significant concerns about FDA's proposal in
that draft guidance document.
It appears, from reading that draft, that FDA did not
engage in rigorous review of current research in regard to
antimicrobial resistance and is attempting to ban the use of
those antibiotics for growth promotion, feed efficiency, and in
some instances preventive treatment based upon uncertain
evidence. In fact, if you read the report, the analysis uses
the phrases like--when you cite reports in that draft, they
fail to establish a direct link between antibiotic use and the
risk to human health, not adequate epidemiological evidence, a
very limited amount of that research unable to find a
substantial body of evidence. And so there is, in my view,
great uncertainty about the specific risk posed by antibiotics
shown in your draft. And it also appears that the most recent
scientific evidence was completed 10 years ago.
And so I am asking what has changed, other than personnel
at the FDA, that now causes the FDA to have a significant
interest in regulating antibiotics.
Also in that draft you state, in fact, that before
withdrawing a drug that is for--a labeled use of an approved
drug, Federal law requires the FDA to demonstrate that new
evidence shows that a drug is not shown to be safe under
approved conditions. And I am interested in knowing what that
new evidence is and how you are proceeding with this draft,
what time frame, have you read the comments, and the direction
that you are going.
Dr. Hamburg. As you well know, antibiotics are an essential
and vital tool for the health of animals and the health of
people. It is a limited resource. There is a serious and
growing problem with antibiotic resistance, and that is well
documented in human populations and in animal populations. And
that is the concern that we are trying to address. We do not
want to go back to an era of pre-antibiotics because the
antibiotics that we have no longer work. And in some areas of
serious medical disease, we have begun to see that kind of a
circumstance occurring.
We are a science-based agency. It is our mission, our
orienting purpose to make data-driven science-based decisions.
So, it is very, very important to us that we do that rigorous
review of the scientific literature and really look at what the
data tells us about these important questions. There is broad
scientific literature in this area. There is a lot of data to
support the concerns about the use of antibiotics in food-
producing animals for growth promoting or feed enhancement
purposes. Many, many of the public health, medical, and
scientific societies have reviewed the science and have made
recommendations that such use should not be considered
judicious, therapeutic use. We, of course, are doing our own
internal reviews.
But this guidance is voluntary guidance. We are working on
it with industry and other stakeholders. When we proposed our
framework, which was to limit medically important antimicrobial
agents in food-producing animals to the circumstances that are
necessary for assuring health and to also have those
antibiotics used under the supervision or oversight of a
veterinarian, that was done as guidance. It was put forward
over the summer. We have received a lot of comments from a
range of stakeholders, all with very different and very hard-
held perspectives. We are analyzing those comments and
continuing to look at the data. We will be coming forward with
a revised guidance and we will continue to have that open for
comment from the public. We want to move towards something that
benefits the health of animals and humans.
Senator Moran. Mr. Chairman, I have follow-up, but I notice
they have just called the vote and I would not want to prevent
Mr. Pryor from having his opportunity to question.
But I would say that the draft proposal that you have put
forth does not demonstrate the things that you said about the
broad scientific evidence. It lacks the connection. And I also
still continue to believe that the scientific research that you
announced or indicated in your draft proposal is still 10 years
old. And so if there is more to come or you have additional
scientific-based evidence, I would welcome that.
Thank you, Mr. Chairman.
Senator Kohl. Thank you, Senator Moran.
Senator Pryor.
NATIONAL CENTER FOR TOXICOLOGICAL RESEARCH
Senator Pryor. Thank you.
Thank you for joining us today, Commissioner. It is always
good to see you.
Let me start with something that you know is near and dear
to my heart. It happens to be located in my State. It is the
National Center for Toxicological Research (NCTR). NCTR focuses
on technological research so that the FDA can make science-
based decisions, and this includes an emphasis on regulatory
science. The decisions that the FDA makes based on this
research range from food safety to safety devices used in the
medical community to safety of basic cosmetics.
The House has proposed a very significant cut--I believe it
is 43 percent--in their continuing resolution, and my
understanding is that might even lead to the closure of NCTR. I
guess the first question is, do you have any idea why the House
targeted NCTR?
Dr. Hamburg. No, I really do not, but it is a grave concern
to me what that will mean.
Senator Pryor. If you do not mind, tell the subcommittee
what NCTR is and what it does and what its unique role is at
the FDA.
Dr. Hamburg. Well, it is a unique resource for FDA and for
the Nation. It is a center for toxicological research really
focused on strengthening our understanding of a set of safety
concerns that cut across drugs and cosmetics and food, dietary
supplements, a range of issues that FDA regulates. It is
helping us to really understand emerging new technologies in
terms of the scientific promise that they hold, things like
nanotechnology. They have been a leader in nanotechnology
research which offers applications in so many areas. But also,
we need to understand what are the implications in terms of
near-term and long-term safety issues, and they are a leader in
research in that area.
They undertake important research in areas that are very
much on the minds of Americans these days, issues like
bisphenol-A (BPA), a chemical in plastic and the lining of food
containers, really trying to sort out what are the risks and
benefits of a substance like that and really understand and
trying to modernize the underlying science of toxicology so
that we can get important answers for consumers and to support
industry in key areas and to make sure that we have the
innovative products that Americans are counting on.
Senator Pryor. Is there another facility that does all this
type of research?
Dr. Hamburg. It is really quite a unique resource, a whole
center really focused on toxicology research and doing this
research in the service of product evaluation for safety and
efficacy.
NANOTECHNOLOGY
Senator Pryor. You mentioned a few moments ago about
nanotechnology and research in that area at NCTR. There are
more and more products that are coming onto the market that
claim to be nanotechnology products. I am sure a lot of them
are.
What steps is FDA taking to ensure the American public that
nano products are safe?
Dr. Hamburg. Well, there is a broad research agenda that
needs to be undertaken to really understand the effects that
these very, very small nano-sized materials have when they are
introduced into the human body, often with chronic exposures,
and they can be used to deliver drugs in exciting ways to get
targeted therapies to people. They can be used in food
products, in cosmetics. They are used in non-FDA-regulated
products as well, including fabric and clothing.
But NCTR is really helping to develop and undertake
important areas of research to examine how these nano particles
work under different circumstances, how the human body
responds, and to look at it under different conditions,
different models, different products, and of course, working in
partnership with others, but it is a unique resource.
Senator Pryor. And my last question on nanotechnology--
maybe my last question because I am out of time--is should the
FDA have a regulatory science program on nano-toxicology.
Dr. Hamburg. I think that we are undertaking important
experiments in that arena. I think it probably needs to be
developed as a full-fledged area of focus, and FDA clearly
should be at the center of those activities in that as we see
more and more products using this technology, we need to be
able to fully assess the risks and the benefits and we need to
have a strong, sound science base to enable us to make the most
informed decisions possible.
Senator Pryor. Thank you.
Thank you, Mr. Chairman.
GENERIC DRUGS
Senator Kohl. Thank you very much, Senator Pryor.
Dr. Hamburg and I talked about this issue before. Over the
years, we have provided funding to speed approval of generic
drugs because, as everybody knows, they save the consumer tons
of money. Unfortunately, the backlog of applications awaiting
approval continues to grow and at this point, we have no
indication that it will slow down. The budget proposes a very
slight increase for generic drugs, not enough to keep up with
the increased workload and again proposes to create a user fee
for generic drugs in order to offset the costs, which would
speed up our ability to get these generic drugs approved.
Research shows that it is the first and second generic
drugs coming to the market that save consumers the real money,
and of those at FDA awaiting approval, how many of the pending
applications, if approved, would be the first or second generic
of their kind on the market?
Dr. Hamburg. Of the pending applications, I believe that
about 365 or so are first generics. I would be delighted to
give you more specifics on the numbers of second generics. I do
not have that information at hand. But it is the case that with
the additional dollars that you have helped us get in recent
years and what we hope to get going forward through a
combination of budget authority and user fees, that we will be
able to make a significant dent in the pending applications and
be able to continue to get these important products to people
as quickly as possible.
You correctly note that they have had a huge impact. I was
told that over the last decade, it has been about $284 billion
saved, and of course, people getting access to these drugs. So,
it is a hugely important area.
[The information follows:]
First and Second Generic Drugs
It is not possible to immediately determine which pending generic
applications would be the first or second generics on the market.
Whether a generic is first or second is based on the order in which it
is approved and marketed. A number of factors can affect which drug is
marketed first, making it difficult to identify which pending
applications will ultimately become first or second generics. However,
FDA makes every effort to ensure that generics are available to
consumers as soon as possible. In most cases, a first generic is
approved shortly after all relevant exclusivities have expired, and all
relevant patents have expired or are successfully challenged.
GENERIC DRUG USER FEES
Senator Kohl. Yes, as you point out, it has been a
tremendous savings, if we can just get these drugs to market.
And the reason I say first and second, if a standard drug from
a brand name company is priced at $10, maybe the first generic
comes out at $8, but then the second generic might come out at
$4 or $2 in order to get their share of markets. So, oftentimes
it is the second generic that comes to market that really
impacts the price of that product to consumers.
Do you support user fees?
Dr. Hamburg. I do support user fees. I think that the user
fees will enable our generic program to be much stronger and I
think that it is increasingly important that we have a robust
generic review program both because of the importance of these
drugs to the American people, as we have been discussing, but
also because our ability to review them is getting harder and
harder. In a way, we are a victim of our own success. Number
one, because the industry has really taken off, we are getting
more and more applications. Believe it or not, we actually
approve about two generic drugs per working business day at the
FDA. So, it is a huge volume that comes before us.
And many of the generic drugs are part of this more
globalized supply and manufacturing chain that we have touched
on briefly. So, increasingly, in order to do the approvals, we
have to go overseas to do inspections of the manufacturing
plants, and that takes more time and money as well.
So, as we are seeing the generic industry really expanding
and the challenge of the review process increasing because of
this globalization--and in some cases, because of the
complexity of the drugs that are coming before us, but mainly
we are facing growing challenges and we need to meet them. I
think that both industry and the public benefit. So, I think it
is appropriate to have the program funded by budget authority
and user fees.
Senator Kohl. Thank you.
Senator Blunt, go ahead.
Senator Blunt. Well, we do have votes, and I may have some
written questions. I would be interested in how big these user
fees are for generics compared to the original certification of
drugs.
Dr. Hamburg. Well, we are just----
Senator Blunt. If you had them, what are we talking about
here?
Dr. Hamburg. We are beginning to sit down at the table for
the negotiations. The President's budget proposes, sort of
targets a $40 million user fee for generic drugs in fiscal year
2012.
[The information follows:]
Generic Drug User Fee
The fiscal year 2012 budget proposal calls for a generic drug user
fee program of about $40 million. In relation to the market for generic
drugs, estimated at $58 billion, according to the Generic
Pharmaceutical Association, this represents a modest expense.
The economics of the generic drug market make it difficult to
determine precisely what impact this $40 million would have on the
price of generic drugs. We note that this $40 million is significantly
less than the $250 million user fee program which members of the
generic drug industry have outlined in public meetings; any impact from
the $40 million user fee would therefore be significantly less than any
impact resulting from the $250 million user fee proposed by industry.
Senator Blunt. If you have any studies on what impact that
has on the prices of these drugs, and maybe it is over such a
large number of drugs it is varied, but I would like to see
that if you have that information. You know what I am asking?
What impact do you think $40 million of user fees would have on
the price of drugs, and is there a way to differentiate that
out?
Dr. Hamburg. Okay. Well, we will take our best stab at
doing that.
[The information follows:]
Generic Drug Price Impacts
The Federal Drug Administration and the generic drug industry have
only recently begun negotiations to discuss generic drug user fees. At
this time, FDA does not know what type of fee structure will be
established, let alone the amount of each fee. FDA's goal is to work
with the industry trade associations to establish a program that
promotes the timely review and inspection of the growing number of
generic drug applications. Members of the generic drug industry
outlined proposals at a public stakeholders meeting that would equate
to about $250 million in annual user fees. Given that sales of generic
drugs are about $58 billion, from the GPHA, such a user fee would
represent less than 1 percent of sales.
By contrast, the prescription drug industry paid approximately $459
million in fiscal year 2008, on 2008 sales of $234 billion, according
to a report by the Kaiser Family Foundation in 2010, also less than 1
percent of sales.
ADDITIONAL COMMITTEE QUESTIONS
Senator Blunt. I would think that would be something we
would want to know as part of the whole evaluation of what
impact this has on the generic marketplace.
And I may have some other written questions, Mr. Chairman.
Dr. Hamburg. Okay, delighted to take them.
Senator Blunt. Commissioner, thank you for your
knowledgeable answers today.
Dr. Hamburg. Thank you very much.
[The following questions were not asked at the hearing, but
were submitted to the Department for response subsequent to the
hearing:]
Questions Submitted by Senator Herb Kohl
overall budget
Question. Please provide a priority list of the increased funding
items you are requesting in the budget.
Answer. The Food and Drug Administration (FDA) is responsible for
protecting Americans many times each day and through every stage of
their lives. Our role in protecting public health is unique, and there
is no one to backstop us.
With these principles in mind, the FDA fiscal year 2012 budget
supports many urgent public health priorities. It contains the
resources to achieve fundamental public health responsibilities
entrusted to FDA. The budget recommends new resources for FDA to
transform America's food safety and nutrition, speed the development of
medical countermeasures to meet critical national security priorities,
protect American patients, and advance the regulatory science that
serves as the foundation for FDA public health decisions.
The initiatives and resources that FDA recommends for fiscal year
2012 will allow us to act more quickly and strategically to protect
consumers from food safety threats and help deliver safer, more
effective medical therapies to the American people. Fulfilling our
responsibilities to the American public requires additional resources,
as recommend in the fiscal year 2012 budget, across all of these
priorities.
Like many Government executives, I am carefully watching the
progress of the ongoing bicameral, bipartisan discussions between the
administration and congressional leadership on the Nation's long-term
fiscal picture. These discussions will likely affect the overall
funding for Federal programs, the scope of many programs and the size
of individual budgets. We look forward to working with you and others
in the Congress as this process moves forward.
The administration is committed to making the difficult decisions
necessary to reduce the deficit. However, we must do so in a way that
safeguards the public health of Americans now and in the future. That
is what FDA and its employees strive to do every day.
medical countermeasures
Question. The budget for fiscal year 2012 proposes an increase of
$70 million for advancing medical countermeasures (MCMs). This is on
top of a fiscal year 2011 request to use $170 million in unspent
pandemic flu money for these activities.
Can you talk a little bit about this initiative--it's a lot of
money. What, specifically, will we be getting with this investment? Is
the initiative scalable, and to what degree?
Answer. FDA plays a key role in facilitating development and
availability of the Nation's MCMs. To successfully contribute and keep
pace with the multibillion-dollar investments being made in MCM
development by the National Institutes of Health (NIH), the Biomedical
Advanced Research and Development Authority (BARDA) of the Office of
the Assistant Secretary for Preparedness and Response, and the private
sector, FDA needs funding to support its MCM Initiative. The fiscal
year 2012 investment of $70 million in the MCM is critical to
successfully developing innovative, safe, and effective MCMs to counter
identified chemical, biological, radiological, and nuclear (CBRN)
threats and emerging infectious disease threats. The $70 million
investment is also essential to develop the capacity to rapidly develop
MCMs in the face of new threats.
The fiscal year 2012 investment in the MCM will help to accelerate
the pace and increase the probability of successfully developing MCMs
for these threats. FDA will use the fiscal year 2012 funds in a number
of ways. FDA will create and maintain a highly qualified workforce with
the appropriate technical training, scientific skill, and subject-
matter expertise to fully support FDA's MCM responsibilities. FDA will
also improve the MCM infrastructure at FDA, such as laboratory
equipment and information technology, so that our researchers and
reviewers have the tools they need. FDA will establish
multidisciplinary Action Teams that will work to establish clear,
science-based pathways for evaluating and approving MCMs. FDA will
expand FDA's regulatory science program to help overcome existing
hurdles in MCM development and to facilitate the translation of
scientific discoveries into MCMs. And, FDA will modernize agency
regulations and policies to make the FDA evaluation and review process
more efficient and to ensure that MCMs can be made readily available to
the public when needed.
Regarding the question about whether the MCM is scalable, we
recognize the budget challenges that the Congress and the Federal
Government face. The FDA investment has been carefully designed and
balanced to fulfill the resource needs for the activities that FDA must
conduct and the performance that FDA must deliver. It has also been
designed to sustain the MCM infrastructure and programs already under
way and to continue and build on this critical work. If the Congress
must scale its investment in MCM, FDA will determine how to make
adjustments.
Question. Are there specific threats that you are working on that
are greater than others?
Answer. Yes, FDA is fully engaged with its MCM Enterprise partners
throughout the Federal Government to establish and maintain MCM
programs and activities based on MCM Enterprise partner priorities
based on anticipated.
The Department of Health and Human Services (HHS) prioritizes both
the threats and the MCM programs to counter those threats. The highest
priority threats include CBRN threats for which a Material Threat
Determination has been issued by the Department of Homeland Security.
Examples include anthrax, smallpox, botulinum toxins, and radiological
nuclear threats. These have been determined to present a material
threat against the United States population sufficient to affect
national security. Pandemic influenza is also a high-priority threat.
The HHS review, ``The Public Health Emergency Medical
Countermeasures Enterprise Review'', released in August 2010,
envisioned the Nation's MCM Enterprise evolving from its current
threat-specific approach to a flexible capability that can produce MCMs
rapidly in the face of any attack or threat, known or unknown. As a
result, FDA is also focusing on supporting the development of broad-
based platform technologies in support of MCM Enterprise priorities
that can offer scalable and flexible advantages over agent-specific MCM
programs for high-priority threats.
Question. I know you've started working on some of this in
earnest--what happens if you don't get the money you are requesting in
fiscal year 2011 or fiscal year 2012?
Answer. HHS provided FDA with the funding to launch and begin
implementing the MCM by allocating $170 million from previously
appropriated funds for pandemic influenza activities. The $70 million
budget request for fiscal year 2012 is designed to provide base funding
for the MCM.
As already noted, the $70 million fiscal year 2012 budget request
for the MCM is designed to sustain the MCM and to enable it to keep
pace with the multibillion-dollar investments ongoing at NIH and BARDA.
If FDA receives less than the amount requested, the agency must limit
its investment in the MCM, regulatory science program, and the full-
time equivalents (FTEs) necessary to support the enhanced review
process for MCMs. The risks of receiving a reduced amount include an
inability to adequately implement FDA's MCM, which will ultimately
degrade the ability of the MCM Enterprise to achieve its mission to
protect the Nation from these threats.
The HHS review, ``The Public Health Emergency Medical
Countermeasures Enterprise Review'', stressed that improving the
regulatory environment for MCMs is critical to the success of the MCM
Enterprise and is among the challenges the U.S. Government must address
if it is to successfully develop MCMs. Moreover, investments in the MCM
have implications for improving the health and security of the U.S.
population beyond countering CBRN threats and emerging infectious
disease threats. Investments to advance regulatory science to support
development of MCMs will contribute directly and indirectly to
development of products to treat other diseases and conditions and help
improve the safety and efficacy of and access to FDA-regulated
products.
pregnancy rule
Question. An estimated 75 percent of all pregnant women use 4-6
prescriptions or over-the-counter drugs at some time during their
pregnancy. It's widely acknowledged that information provided to
pregnant women on drug labels is confusing at best. I know FDA has been
working on this issue and even proposed a rule in 2008.
I understand that 73 comments were received on this proposed rule.
Even if they are extremely complex, I can't see why I would take
several years to go through 73 comments. Can you tell me the reason for
the delay?
Answer. FDA staff have been reviewing the comments, identifying and
considering the issues raised by the comments, determining whether any
revisions should be made to the proposed regulation and preparing the
final rule. FDA staff are continuing to work on the final rule. Because
of the importance of this public health issue, FDA wants to proceed
with the appropriate care and judgment.
Question. Is it a priority for FDA, and when do you think it will
be finalized?
Answer. Publication of the final rule regarding prescription drug
labeling for pregnant and lactating women remains a strong priority
within FDA. FDA staff are actively working on the rule. Please be
assured that FDA is committed to finalizing this rule as promptly as
feasible and practical.
generic drugs
Question. Dr. Hamburg, I ask about this every year. Over the years
we have provided funding to speed approval of generic drugs. We do it
because they save consumers and the Government significant money.
Unfortunately, the backlog of applications awaiting approval continues
to grow. And at this point, we have no indication that it will slow
down. The budget proposes a slight increase for generic drugs--not
enough to keep up with the increased workload, and again proposes to
create a user fee for generic drugs in order to offset the costs. These
user fees would allow you to collect more than $40 million in fiscal
year 2011.
To put the question in context, how many generic drug applications
are pending at FDA right now?
Answer. There are approximately 2,400 generic drug applications
pending. These pending applications include applications that are
awaiting FDA's original assessment or review, applications that FDA
found were not ready for approval and the company is preparing a
resolution or response to address the FDA concerns, and applications
awaiting re-review where companies submitted responses to deficiencies
previously identified by FDA. This last category of applications is
known as amendments.
Question. Research shows that it's the first and second generic
drugs that save consumers the most money. Of those in the backlog, how
many, if approved, would be the first or second generic of their kind
on the market?
Answer. Our current tracking system does not allow us to identify
pending generic applications as first or second generics. Whether a
generic is first or second is based on the order in which it is
approved and marketed. A number of factors can impact this order and
factors can cause the order to shift with the passage of time. In
addition, a first generic might be only one of the dosage strengths
that the brand manufacturer makes, so the actual definition of first
generic is not always clear. The Food and Drug Administration makes
every effort to ensure that generics are available to consumers as soon
as possible. In most cases, a first generic is, as with multiple
generic drugs, approved shortly after all relevant patents and
exclusivities have expired or the relevant patent is successfully
challenged.
Question. And within those, how many could go on the market
tomorrow, as opposed to those being delayed due to lawsuits, etc.?
Answer. As explained earlier, we cannot specify the number of
pending first and second generic applications, and therefore, we cannot
specify how many of those applications are not blocked by patents or
exclusivities.
However, of the approximately 2,400 abbreviated new drug
applications currently under review, about two-thirds are currently
blocked from approval by patents or other exclusivities. Please note
that applications waiting for expiration of patents or exclusivity to
expire may be tentatively approved. A tentatively approved application
has been found to meet FDA's rigorous approval requirements, and is
ready to be marketed as soon as the innovator patent expires, the
patent is successfully challenged, or all exclusivities expire. As a
general matter, all patent or exclusivity issues related to the brand
product or reference listed drug must be resolved before the generic
product can be approved. Currently, there are 309 tentatively approved
applications.
food safety modernization act
Question. The Food Safety Modernization Act (FSMA), passed last
year, was the largest expansion of FDA's authorities in 70 years.
Obviously, the way food is produced, transported, stored, and consumed
has changed since then, so this updated law was long overdue.
The Congressional Budget Office has estimated that it will cost
$1.4 billion over 5 years to fully implement this law. Your budget
proposes an increase of around $225 million for your Transforming Food
Safety and Nutrition Initiative, which includes $183 million for you to
begin implementation. Will this amount fully fund FDA's first year
costs for the new food safety law, and how much additional funding do
you think you'll need over the next few years?
Answer. With the requested increase of $183 million to implement
FSMA, FDA expects to make substantial progress in building the science-
based, prevention-oriented, and efficient food safety system mandated
by the Congress. FDA plans to issue the key regulations required by
FSMA, including produce safety standards, preventive controls in food
facilities, and standards for preventing intentional adulteration. In
addition, we would strengthen the scientific basis for the Foods
Program, including the ability to make the design and implementation of
our prevention standards more risk-based and effective in preventing
food safety problems.
FDA plans to train FDA investigators in the latest inspection
techniques that take advantage of the preventive controls regulatory
framework. FDA will also build State capacity and create a national
inspection work plan so that State inspections can be leveraged to meet
FDA's domestic inspection frequency requirements.
FDA plans to design and implement a new import safety framework for
carrying out the FSMA mandates. The new framework will include stronger
importer accountability through the foreign supplier verification
program, an accredited third-party certification program, comparability
assessments to determine if foreign governments have food safety
systems comparable to that of the United States, a voluntary qualified
importer program to expedite review and importation of food by
qualified importers, and expansion of the foreign inspection program.
Finally, FDA will need to rely on better information technology to
support more efficient domestic inspection and effective oversight of
imports.
In future years, FDA will need to continue to invest in
implementing these programs, including increasing FDA science capacity,
strengthening the integrated food safety system, and implementing the
import safety framework. We hope to work with the Congress to ensure
that FDA has adequate resources to achieve our shared food safety
goals.
Question. There have been statements made that this law isn't
really necessary. Some people point to the recent decreases in the
Centers for Disease Control and Prevention (CDC) estimates of the
numbers of deaths and illness from food-borne illnesses. Particularly
at a time when Federal spending is declining, how would you respond to
those criticisms? Why do we need to spend this additional money right
now, when we continue to have one of the safest food supplies in the
world?
Answer. The revised CDC estimates still demonstrate a significant
public health burden due to foodborne diseases with an estimated 48
million illnesses, affecting one in six Americans each year and
resulting in 128,000 hospitalizations, and 3,000 deaths each year. It
is true that the United States has one of the safest food supplies. For
the most part, the food industry does a good job of providing abundant,
safe food to American consumers. However, there has been a continuing
series of food safety problems--major recalls, outbreaks, and
illnesses--most of which are preventable. FDA FSMA, which gives FDA new
tools to prevent foodborne illness, received the support of industry
and consumer groups, as well as the Congress, and represents a
consensus that improvements in the current system are necessary.
Question. How will these efforts help our economy? What is our
return on investment?
Answer. Efforts to improve food safety through the prevention-
focused framework envisioned in FSMA will result in fewer outbreaks of
foodborne illness and more rapid response when they do occur. Outbreaks
are costly to all involved--to consumers, to the food and feed
industries, and to the healthcare industry. A 2007 study estimated the
average hospital stay at 5.8 days for each case of foodborne illness
requiring hospitalization. The same study estimated the average cost
per case of foodborne illness at between $16,100--for an adult--and
$26,700--for a child. In the case of the 2006 spinach recall, the
Institute of Food Technologists estimated the cost of recalled spinach,
lost sales, lost productivity, and other costs at $129 million.
Likewise, in the case of the 2008 Peanut Corporation of America (PCA)
peanut product recall, one major manufacturer--Kellogg--estimated its
costs to recall peanut-containing products at $65 million to $70
million. FDA expended more than 100 staff years--full-time
equivalents--to protect consumers and conduct PCA-related inspection
and recall activities. In the aggregate, the costs of foodborne
illnesses and outbreaks are in the billions of dollars.
Question. How can you ensure that the produce safety regulations
you are drafting will not follow a one-size-fits-all approach, which
would harm small and organic growers?
Answer. FDA is aware of the tremendous diversity in farming
operations and that a one-size-fits-all approach to produce food safety
will not be practicable. Over the past year, FDA and U.S. Department of
Agriculture (USDA) technical experts, scientists, and other staff
participated in listening sessions and meetings in 13 States. In some
of those States, we were able to tour large and small farms and speak
with people who have the on-the-ground knowledge that FDA realizes must
be reflected in the proposed rule. FDA is committed to providing
operators with flexibility and innovation in their approaches to on-
farm food safety for their operations.
food safety duplication efforts
Question. The Government Accountability Office (GAO) recently
issued a report on duplicative Government programs. Duplication in food
safety across Federal agencies was a major theme in the report. Of the
15 agencies with oversight over food safety activities, the FDA is in
charge of 80 percent of domestically produced and imported food.
Since your agency has responsibility for the vast majority of the
food we eat and in light of the fact that we just passed a massive food
safety overhaul bill, can you please respond to the findings of the
report regarding overlap in food safety activities?
Answer. The GAO report, ``Federal Food Safety Oversight--Food
Safety Working Group Is a Positive First Step but Governmentwide
Planning Is Needed to Address Fragmentation,'' highlighted the positive
steps taken by the Federal food safety agencies under the auspices of
the Food Safety Working Group (FSWG) to coordinate and collaborate on
cross-cutting food safety issues, such as produce safety, salmonella
contamination, and food safety performance measures. The report
contained one recommendation for the Office of Management and Budget
(OMB) to develop a Governmentwide performance plan for food safety. FDA
continues to work through FSWG with its food safety partners to address
a coordinated agenda of food safety issues as appropriate within our
statutory frameworks.
Question. How often and how well do you work with the Food Safety
and Inspection Service and other Federal, State, and local food safety
agencies during an outbreak that would affect both agencies, and how
can you improve?
Answer. FDA works with its State and local food safety partners
during every outbreak of foodborne illness. FDA and its State and local
counterparts are striving to improve how they work together on
outbreaks. Efforts include cooperative agreements with States to form
rapid response teams (RRTs). The RRT agreements allow the selected
recipient to build State program infrastructure and rapid response
capabilities for food and feed emergencies and implementation of the
Manufactured Foods Regulatory Program Standards. This project engages
partners to develop innovative programs and tools, both within each
individual program and jointly among the nine pilot teams.
During the past 2 years, there have been three specific
investigations in which FDA and USDA have had close, very positive
collaborations--salmonella enteritidis in shell eggs, salmonella
montevideo in spices used in deli meat, and salmonella enteritidis in
liquid-/pasteurized eggs. In these investigations, FDA and USDA senior
level and field level staff have planned the investigation, worked side
by side in the field, shared laboratory resources, and coordinated
closely on messages to consumers. Also, senior outbreak staff from FDA,
CDC, and USDA now participate in 1- to 2-week orientation visits within
each agency to better understand policies and procedures, and allow
networking outside of emergency events. In addition, through FSWG, the
Federal food safety agencies recently formed a group to improve how
they work together during outbreaks. The agencies have formed a
standing Multi-Agency Coordination Group for Foodborne Illness
Outbreaks (MAC-FIO). MAC-FIO is comprised of a designated
representative from each of the Federal agencies with food safety
responsibilities, which allows for rapid coordination and communication
during an outbreak that involves multiple Federal food safety agencies.
advancing regulatory science
Question. The budget includes an increase of $49 million for your
regulatory science initiative. Of this, nearly $24 million is to pay
for FDA staff to occupy a new lab.
What specifically will these funds be used for? Please provide a
breakout of spending. Is this a top priority?
Answer. The Advancing Regulatory Science funding relating to White
Oak are required to ensure that the new Life Sciences-Biodefense
Laboratories and supporting facilities on the White Oak Campus are
outfitted and operational to support critical FDA biologic and human
drug research programs. Since these laboratories use select agents,
they must undergo a highly specialized certification process before we
can conduct research in these facilities to advance FDA's mission.
These funds will allow the testing and commissioning of state-of-the
art laboratory equipment required for FDA science operations to support
the following programs: annual and pandemic influenza, nonpandemic
MCMs, blood and other biological products, biosimilars, and regulatory
science. System testing and commissioning includes building automation
system operation and monitoring, air flow tests, HEPA air filter tests,
primary bio-containment device effectiveness, room pressurization
control, and power tests. Funding will also allow FDA to provide for
cabling and telecommunications equipment to support lab operations.
This is a top priority as the funding will allow FDA to demonstrate
that all systems and standard operating procedures will provide
environmental and biological safety. We will be severely hampered in
our ability to protect national security and world-wide public health
if funding is not received as our existing laboratories are outdated
and filled to capacity. In addition, FDA lab facilities would not be
able to move to White Oak from National Institutes of Health and other
locations and FDA would continue to pay approximately $20 million in
annual rent for existing facilities.
drug safety
Question. Drug recalls have increased significantly since 2009, and
there have been several high-profile cases of tainted drugs reaching
the market. There have been many potential causes discussed for these
increases. Some point to the high cost of manufacturing drugs, and
cost-saving measures taken by manufacturers that lead to problems.
Others point to manufacturers rushing too quickly to be the first
company to submit an application, especially in the case of generic
drugs. Another obvious concern is that 40 percent of drugs consumed in
the United States are imported, while 80 percent of the ingredients
used in U.S. drugs come from other countries, and these numbers
continue to rise. Both you and your senior staff have said very
recently that we continue to be at risk, and another drug safety
problem is all but unavoidable. The budget includes an increase of $56
million for the Protecting Patients Initiative, of which $12 million is
for import safety.
Can you talk specifically about this increase, and more generally
about how you begin to address problems like this when increased
funding is not a certainty?
Answer. The increased funding will be used to strengthen our
multifaceted approach for leveraging different opportunities for
additional knowledge of imported products and foreign manufacturers. As
resources allow, we will continue to pursue our efforts to conduct
additional foreign inspections, enhance our working relationships with
international regulatory counterparts, and strengthen our foreign
presence. FDA conducts inspections of foreign facilities that offer
FDA-regulated products for import into the United States, and in some
cases supplements information gathered during inspections with
knowledge gained from foreign regulatory counterparts. In this regard,
we continue to enhance working relationships and information-sharing
with our international regulatory partners which, in turn, help FDA
identify problem products before they are offered for import and enter
U.S. commerce. Another important opportunity is FDA's acceptance into
the Pharmaceutical Inspection Cooperation Scheme, whose primary goals
are to foster the international development, implementation, and
maintenance of harmonized Good Manufacturing Practice standards, and
further the development of a quality system of inspectorates in
medicinal products.
FDA is also participating in a pilot program with the European
Medicines Agency on the coordination and performance of joint
inspections. The overall objective is to see whether greater
international collaboration can better distribute inspection capacity,
allowing more sites to be monitored and reducing duplication. In
addition, FDA's Office of International Programs has opened several
foreign offices to further enhance FDA's ability to protect U.S.
consumers from unsafe foreign-sourced products. Establishing a foreign
presence reflects the evolution of FDA's regulatory strategy and its
responsiveness to U.S. consumers in meeting its mission of public
health protection.
An additional example of international collaboration includes the
FDA's memorandum of understanding with the Health Products and Food
Branch of Health Canada. This allows FDA and Canada to develop specific
procedures for sharing of regulatory, emergency management, and public
health information related to drug products. This can include
information on quality defects or product recalls of therapeutic
products manufactured or distributed in Canada, inspection reports,
product samples, enforcement activities, product investigations, as
well as information on facilities registered or authorized to market
products.
patient medication information
Question. I understand that FDA has been working on a new process
for producing consumer and patient medication information (PMI) that is
included with patient prescription medication. This is due to a general
belief that the current format can be confusing, and too much
information can be included, which makes it less useful to consumers.
This information is currently produced by private publishing companies.
My understanding is that the current proposal would require each
manufacturer to provide a consumer/PMI insert with each drug they
produce, and the information would be limited to one page.
Concerns have been brought to my attention that requiring every
drug manufacturer to independently produce this information could lead
to inconsistent information being provided to patients, and limiting
the documents to one page could lead to the omission of important
information. I have further been informed that FDA has stated they will
not be able to provide oversight of these documents.
What is the current plan for modernizing the consumer and PMI? What
was the thought process behind requiring each manufacturer to publish
this information independently?
Answer. FDA's ongoing analysis of and plans for modernizing
consumer and PMI are intended to achieve the goals of Public Law 104-
180, enacted in 1996, which included specific targets regarding the
distribution and usefulness of PMI. FDA-commissioned studies subsequent
to the enactment of Public Law 104-180 have indicated that those
statutory goals are not being met by current private sector efforts,
and we are considering next steps.
Currently, documents are developed by drug manufacturers, other
private organizations, or individuals and patients may receive several
different types of information, developed by different sources. PMI may
be duplicative, incomplete, inconsistent, or difficult to read and
understand, and distribution is voluntary for certain types of PMI. The
distribution of Medication Guides, in accordance with 21 CFR part 208
and some patient package inserts in accordance with 21 CFR 310.501 and
310.515 is mandatory as described in the regulations.
FDA has determined that the current system is not adequate to
ensure patients receive essential medication information needed to
safely use drugs. Based on recommendations from FDA's Risk
Communication Advisory Committee and other stakeholder input, FDA sees
merit in adopting the use of a single document with standardized
content and format. FDA is working with all relevant parties, such as
patients, healthcare providers, drug manufacturers, interested
professional organizations, and PMI developers and publishers, to
determine the appropriate regulatory path forward. For example, the
Engelberg Center for Health Care Reform at the Brookings Institution is
working with key stakeholders, including FDA, to conduct initial
demonstration pilots, designed to evaluate feasibility of various PMI
distribution channels and assess patient and provider PMI preferences.
FDA does not intend to limit production of PMI solely to drug
manufacturers. Our goal is to establish standards regarding the content
and format of PMI in order to increase the overall quality of the
documents patients receive and hopefully enhance patient care through
proper medication use. FDA is still considering how best to accomplish
this goal, and has not finalized requirements for the procedural
aspects surrounding the creation of PMI or the single page limitation.
When making any determinations, FDA will consider all stakeholder
input, including the comments received in your statement.
Question. Can you please address the concerns that have been
brought to my attention?
Answer. We understand that concerns have been voiced that requiring
every drug manufacturer to independently produce PMI could lead to
inconsistent information being provided to patients, and limiting PMI
documents to one page could lead to the omission of important
information. To address those concerns, FDA is seeking public input and
taking a scientific approach, including conducting research, as part of
our decisionmaking process. FDA has developed three draft PMI
prototypes to be used in consumer testing. The results of the consumer
testing will inform FDA of the usefulness and various format options
for PMI documents. FDA recognizes that FDA review and approval of all
PMI documents prior to distribution may not be feasible given our
resource constraints and the potential volume of products that may
require PMI, perhaps as many as 22,000 products. FDA is considering
developing standardized content and format requirements, which should
enhance quality and accessibility of information in PMI, similar to the
standardized labels on over-the-counter drugs and many food products,
and should lead to improvements in patient care due to safer use of
medications.
Question. Will there be rules regarding updating and streamlining
information to make it easily understandable for consumers, which
providing an appropriate amount of information? Will FDA provide
oversight on these publications?
Answer. Yes, FDA intends to develop rules or guidance based in part
on the outcomes of our testing and pilot projects. FDA has developed
three draft PMI prototypes to be used in consumer testing. Based on
public comment and expert panel input, FDA is also finalizing the
design of the consumer testing study of the prototypes. Consumer
testing will begin when the final study design is approved by OMB. The
results of this study will inform FDA of the usefulness and various
format options for PMI documents.
FDA intends to provide oversight of PMI documents, and is
considering the best approach for doing so. Although one approach to
oversight could involve FDA review and approval of all PMI prior to
distribution, we recognize that this may not be feasible given FDA's
resource constraints and the potential volume of products that may
require PMI--perhaps as many as 22,000 products when including all
innovator and generic products.
Question. What is the timeline for this change?
Answer. Before implementing changes to PMI, the plan is for FDA to
first study and test the utility of PMI prototypes. Approval by the
White House OMB for this research is expected by July 2011 and results
of the study are expected in 2012.
One option for implementing changes to PMI might be to develop a
new rule. The timeframe for developing and finalizing a new rule at FDA
varies, but the process can take a 5 years. Thus, implementation of a
PMI rule would likely not occur prior to 2015/2016. During FDA's
decisionmaking process, FDA plans to continue to study prototypes,
research potential processes, and discuss and evaluate the impact of
those potential procedures. FDA intends to continue to involve all
interested stakeholders in these activities.
generic for lipitor
Question. I understand that later this year, a generic for the
blood pressure drug Lipitor will be eligible to enter the market due to
patent expirations. The entry of generic competition to Lipitor has the
potential to save consumers as much as $6.7 billion.
Are you working to try to reach a decision as to whether to approve
a generic drug application for Lipitor in a timely fashion?
Answer. Lipitor, which has the chemical name atorvastatin, is a
drug used to treat high cholesterol. The FDA recognizes the benefits
and value of making safe, effective, high-quality generic drugs, such
as Atorvastatin, available to the American public. FDA is fully
dedicated to doing so as quickly as possible within the framework of
the law and applicable regulations.
______
Questions Submitted by Senator Dianne Feinstein
progress on research into bisphenol-a
Question. I remain particularly concerned about the use of
bisphenol-A (BPA) in food containers, particularly those used to
provide food and beverages to infants and children. Mounting scientific
evidence demonstrates a link between BPA exposure, even at low doses,
and a host of harmful health effects such as cancer, diabetes,
behavioral disorders, and heart disease. This is why I have introduced
legislation in the 112th Congress that would ban the use of BPA in baby
bottles, sippy cups, infant formula, and baby food.
In January 2010, the Food and Drug Administration (FDA) released an
``Update on Bisphenol A for Use in Food Contact Applications'' (update)
to explain your current perspective on BPA, including support for
additional research and interim recommendations for public health.
In this update, you agreed with the National Toxicology Program
(NTP) at the National Institutes of Health (NIH) and expressed ``some
concern about the potential effects of BPA on the brain, behavior and
prostate gland in fetuses, infants, and young children.'' You also
cited additional research being pursued by the FDA's National Center
for Toxicological Research (NCTR), and the interim steps you would take
to reduce exposure.
What progress have you made in your consideration of the low-dose
toxicity studies and peer-reviewed studies of BPA?
Answer. FDA announced the availability of updated review documents
on low-dose studies in a Federal Register Notice published on April 5,
2010. Since that notice published, FDA has continued to incorporate new
published information and information from studies conducted at FDA's
NCTR into our review of the safety of BPA in FDA-regulated products.
Question. What is the status of the research being conducted by the
FDA's NCTR, including those studies being conducted in collaboration
with NTP?
Answer. FDA's NCTR is conducting studies characterizing the
toxicities of BPA in several animal models in partnership with NTP.
Study designs are using both oral and intravenous routes of exposure.
The results with oral studies are used to model dietary exposure while
intravenous studies are used to model neonatal and infant exposure in a
medical setting.
To date, the results of several studies have been published in the
peer-reviewed scientific literature. Four studies were published that
characterize systemic distribution and excretion patterns following
oral and intravenous administration of BPA using rat and nonhuman
primate models. Human biomonitoring data are also being collected in
conjunction with research partners, including FDA's Center for Devices
and Radiological Health; the Centers for Disease Control and Prevention
(CDC); and the Pacific Northwest National Laboratory. The animal study
data and the human biomonitoring data will be combined into
mathematical models to minimize uncertainties in estimates of human
tissue exposures.
Several additional, longer-term exposure studies with BPA
evaluating effects of in utero and neonatal exposures are in progress
in rats, which include the effects on the brain structure and behavior.
Additional long-term exposure studies are scheduled to begin in fiscal
year 2012. These studies include a lifetime cancer bioassay, and an
evaluation of factors related to diabetes and heart disease. All the
studies have been designed to fill data uncertainties identified by FDA
and NTP in order to assess potential impact of BPA on human health.
Question. What is the status of your consultations with other
expert agencies including the NIH, the Environmental Protection Agency
(EPA), the Consumer Product Safety Commission (CPSC), and CDC?
Answer. FDA included scientists from several other agencies
including NIH, EPA, and CPSC in an external review of our most recent
memorandum on low-dose studies of BPA. We continue to interact with
Government scientists from all these agencies to better inform our
safety assessment process. For example, FDA's on-going studies at the
NCTR are being performed in collaboration with the National Institute
for Environmental Health Sciences (NIEHS), as mentioned previously and
FDA scientists have attended NIEHS BPA grantee meetings. In addition,
in November 2010, FDA scientists participated with other U.S.
Government scientists as well as international experts in a Food and
Agriculture Organization (FAO)/World Health Organization (WHO)-
sponsored consultation regarding the safety of BPA in food contact
applications. One conclusion of the FAO/WHO consultation was that it
would be premature to initiate public health measures based on current
data.
Question. You cite support for the industry's actions to stop
producing BPA-containing bottles and infant feeding cups in the U.S.
market. What specific actions, if any, have you taken to express this
support?
Answer. FDA announced its support for these actions in a January
10, 2010, announcement posted on FDA's Internet site. At that time, FDA
announced that major manufacturers had stopped selling new BPA-
containing baby bottles and infant feeding cups for the U.S. market
since early 2009. FDA's contact with these industry members over the
past year continues to confirm that BPA is not being used for the
manufacture of infant feeding articles.
Question. You also cite the FDA is facilitating the development of
alternatives to BPA for the linings of infant formula cans by working
with manufacturers, giving technical advice on the approval of
alternatives, and expeditiously reviewing new applications for
alternatives. Please provide details of the efforts you have taken in
this area.
Answer. FDA has worked with industry to increase our understanding
of the different packaging materials currently used for infant formula
and the types and quantities of infant formula packaged in these
materials. At the present time nearly 90 percent of infant formula--
primarily those that are powdered--sold in the United States is
packaged in materials that are not manufactured using BPA. Over the
past year, FDA has actively worked with industry on a wide range of
alternative materials for liquid infant formula packaging. Because of
the complexities in this market and the higher potential exposures to
infants to these materials, FDA has provided substantial individualized
guidance regarding the development of appropriate safety data to ensure
safe use of replacement products. These efforts have been the subject
of over a dozen presubmission applications, a tool FDA uses to
communicate with industry prior to the formal submission process. Once
an applicant submits a complete premarket submission is made to FDA,
the review time is 120 days. We continue to work with the infant
formula and packaging industries to bring safe alternative materials to
the market.
nuclear radiation and its effect on our food supply
Question. The tragic events that continue to unfold in Japan are
having extraordinary consequences even within our own society. In
addition to the earthquake's much publicized effect on gas prices and
the price of consumer electronic goods, there is substantial concern
about the safety of food produced in regions affected by the nuclear
radiation emitting from the damaged power plants.
What extra precautions is the FDA taking to ensure that all food
that has been exposed to high levels of radiation is either destroyed
or decontaminated before it enters the U.S. market?
Answer. From the earliest days of the situation in Japan, FDA has
been actively protecting United States consumers from potentially
contaminated products; instituting import controls to ensure such
products do not enter the United States marketplace, and adjusting
those controls as circumstances warranted. These controls include the
detention of specific products from prefectures reported by the
Japanese Government as being found to contain radionuclides; and
increased examinations and FDA analysis of other FDA-regulated
products. These controls provide a blanket of coverage for FDA-
regulated products from Japan. As this situation evolves, our targeted
coverage is evolving.
As of today, March 17, 2011, FDA-activated electronic screening
criteria to hold all lines of products manufactured or shipped by
Japanese firms. This screening provides instructions to FDA's field
offices when encountering shipments from Japan. The instructions
include documenting review and disposition of all shipments from Japan
based upon when the shipment left Japan. For those shipments that left
Japan prior to March 11, no further action is required. Admissibility
is determined as per normal procedures. For all lines shipped on or
after March 11, if the shipment originated from an area outside of our
areas of concern, admissibility is determined as per normal procedures.
If the shipment originated from within the affected area, FDA
investigators are instructed to check with local Customs and Border
Protection (CBP) to determine if the shipment went through CBP's
radiation screening. CBP will contact FDA if CBP has not screened the
line or if CBP screening indicates adverse readings for the presence of
radionuclide contamination.
If the importer of contaminated product does not voluntarily
destroy or decontaminate the product, we will rely on CBP's seizure
authority to take control of the product and ensure it is properly
disposed.
Question. What steps is FDA taking to ensure that the elevated
levels of radiation in the United States does not impact food
production in California and across the rest of the country?
Answer. EPA is monitoring atmospheric radiation levels and collects
environmental samples, such as rainwater, to monitor radiation and any
increases that may occur due to the tragedy in Japan. Monitoring allows
FDA to react swiftly in the unlikely event of significant amounts of
radionuclides reaching our shores. So far, EPA's monitoring has
detected only very low traces of radionuclides characteristic of a
power plant accident. These levels do not present a public health
concern. FDA has had a sampling program in place domestically for many
years collecting samples of food products from areas around nuclear
facilities to monitor any potential problems, including California and
other States across the country. There have been no sample results from
this program indicating harmful levels of radionuclides. We continue to
keep abreast of EPA's monitoring to ensure that there is no threat to
our domestic crops.
food safety bill implementation
Question. I strongly supported the passage of FDA FSMA last
Congress because I believe that the FDA needs to move towards
preventative model when it comes to protecting the safety of our food
supply. I believe that all processors should have in place a Hazard
Analysis and Critical Control Point (HACCP) plan, and I believe that we
must fully enforce the requirement that these plans are in operation
any time food is being produced.
However, produce farmers in my State that are concerned that FDA
will take a one-size-fits-all approach when it comes to the
implementation and approval of these food safety plans. I do not think
that this would be in the best interest of safety, and it certainly
would not be in the best interest of the food production industry.
What are you doing to ensure that HACCP plans will be product
specific? What assurances can I give farmers in California that the FDA
will not treat spinach HACCP plans, like almond or dairy HACCP plans?
Answer. We understand your question to relate to the produce safety
standards required by section 105 of the FDA Food Safety Modernization
Act. FDA is aware of the tremendous diversity in farming operations and
that a one-size-fits-all approach to produce food safety will not be
practicable. FDA is committed to providing operators with flexibility
and innovation in their approaches to on-farm food safety for their
operations. FDA intends to propose a rule containing requirements that
will be commensurate to the hazards and risks associated with any
particular operation.
antibiotics in food production
Question. I remain concerned about the overuse of antibiotics in
food animal production and FDA's slow response to address this critical
public health matter. While I was encouraged to see the FDA proposal in
guidance for industry (GFI) No. 209 in June of last year, I have not
seen or heard of any definitive progress since. I cannot underscore the
importance of swift action in addressing this concern--in the last 10
years antibiotic resistant E. coli infections have risen by 16.5
percent, antibiotic resistant P. mirabilis infections have risen by 19
percent, and MRSA infections rose by 22.4 percent.
When will FDA offer a definitive plan of action on how to reduce
the over- and misuse of antibiotics in food animal production?
Answer. FDA's action plan for promoting more judicious use of
medically important antimicrobial drugs in food-producing animals began
in 2010 with the publication of draft GFI No. 209. GFI No. 209, which,
for the first time, lays out FDA's policy on the use of these drugs in
animal agriculture provides two definitive guiding principles. The
first principle is that medically important antimicrobial drugs should
be used in food-producing animals only when necessary for assuring
animal health. The second, that such use should include veterinary
oversight or consultation. We believe that by communicating these key
principles we have identified a clear pathway forward as we work with
the animal health and animal agriculture industries to reduce the
overuse and misuse of antibiotics in food animal production. FDA is
close to completing review of comments received regarding draft GFI No.
209 and plans to finalize the guidance later this year.
However, while this was an important first step, the goal now is to
put these principles into action. Since publication of GFI No. 209, we
are very encouraged by the interactions we have had to date with key
stakeholders, including the animal health industry, on plans for
implementation. Sponsors of some of our most important antimicrobial
drugs have already initiated discussions with FDA about updating their
animal drug products in a manner consistent with the principles of GFI
No. 209.
To further support implementation of GFI No. 209 principles, FDA
intends to issue additional guidance which will provide more specific
information for animal drug sponsors. In addition, FDA has initiated
the rulemaking process to streamline the Veterinary Feed Directive
System to facilitate the transition to veterinary oversight of the use
of medically important antimicrobial drugs in feed. Work has already
begun on both of these tasks and related publications can be expected
sometime within the next year.
Question. If you intend to follow the general principals laid out
in GFI No. 209, how will you define the term ``nontherapeutic use of
antibiotics''? Will the definition include prophylactic use of these
drugs?
Answer. The intent of GFI No. 209 was to make a distinction between
those uses of medically important antimicrobial drugs in food-producing
animals that FDA considers judicious and those we consider injudicious.
In this context, FDA believes those uses that are considered necessary
for assuring animal health are judicious uses and those uses for
production purposes in healthy animals, such as to promote growth or
improve feed efficiency, represent injudicious use. As noted in the
GFI, FDA considers uses that are associated with the treatment,
control, or prevention of specific diseases to be uses that are
necessary for assuring the health of food-producing animals. However,
while FDA does believe that some prevention uses are necessary and
judicious, we also believe it is imperative that such uses include
veterinary oversight or consultation. Veterinary involvement in the
decisionmaking process associated with the use of medically important
antimicrobial drugs is an important aspect of assuring appropriate use,
including judicious preventive use.
Question. It is also my understanding that the FDA intends on
revisiting the Veterinary Feed Directive (VFD) program and the approval
of new animal drugs under FDA GFI No. 152. What revisions to these
documents are you considering and by when do you plan on making these
recommendations public?
Answer. In March 2010, FDA published an Advance Notice of Proposed
Rulemaking (ANPRM) regarding the VFD program. This action was taken in
response to informal comments received by FDA that characterize the
current VFD process as being overly burdensome. FDA is concerned that
the VFD process in its current form may be difficult to administer in
the future as the number of approved VFD animal drugs increases.
Therefore, the goal will be to streamline the regulatory requirements
where possible while still protecting public and animal health. The
target date for publishing of specific proposals based on the comments
we received on the ANPRM is planned for sometime during 2012. Of
course, FDA's publication date can be affected by issues that emerge
during the review and clearance process.
FDA believes that GFI No. 152 has provided an effective mechanism
for evaluating antimicrobial resistance concerns as part of the new
animal drug approval process. This GFI includes a table that ranks
antimicrobial drugs with respect to their importance to human medicine.
FDA has acknowledged that this listing may need to be periodically
updated so that it reflects current conditions regarding antimicrobial
use in humans. FDA intends to seek public comments on any updates to
the GFI prior to implementation.
______
Questions Submitted by Senator Roy Blunt
use of veterinary drugs in food-producing animals
Question. The international body that establishes standards for
food safety, known as Codex Alimentarius, is playing an increasing role
in the facilitation of market access for U.S. agricultural products to
a growing number of countries and customers around the globe. Standards
set by Codex should be established based on scientific merit and be
used to improve trade, not hinder it.
Specifically, the Codex Committee on Residues of Veterinary Drugs
in Foods (CCRVDF) has had a maximum residue standard for a Food and
Drug Administration (FDA)-approved veterinary product, ractopamine,
pending for the past 3 years. The adoption of this standard should move
forward.
FDA chairs this particular Codex committee, what are your thoughts
on the current process as it relates to this particular situation?
Answer. An FDA employee chairs the CCRVDF and another FDA employee
serves as the U.S. delegate to this committee. Proposed ractopamine
maximum residue levels (MRLs) for cattle and swine have been advanced
from this committee to the Codex Alimentarius Commission (CAC) for
adoption. Adopting MRLs is pending at the CAC level. The U.S.
Government is part of a small group of countries that have been meeting
at the CAC level to resolve the ractopamine issue before the next CAC
meeting. The U.S. delegation remains hopeful the deliberations will be
successful and the recommended ractopamine MRLs will be finalized and
adopted by the CAC as a Codex standard.
The U.S. delegation is committed to moving forward to adopt MRLs
for ractopamine on the merits of the scientific evidence presented to
Codex, without exemptions that would undermine the international Codex
standard. The ractopamine MRLs have been recommended as safe after
extensive review by the Joint Expert Committee on Food Additives
(JECFA), an independent Food and Agricultural Organization/World Health
Organization scientific body of recognized world experts. Adopting
Codex MRLs for ractopamine is especially important for countries that
do not have the resources to carry out their own risk assessments and
rely on Codex MRLs. Other countries that do not have an MRL, but want
to import from countries that enforce Codex MRLs can do so with
confidence in the safety of the product.
Some countries are trying to block adoption of the ractopamine MRLs
using arguments that include national interests, national laws, or
preferences regarding product use. Blocking the ractopamine MRLs after
they have been evaluated and deemed safe by JECFA undermines the
ability of Codex to establish international food safety standards, and
may set a precedent for discounting the advice of its scientific
experts.
Question. How is FDA engaging within with our trading partners to
ensure a science-based outcome of Codex meetings?
Answer. The FDA works very closely with the U.S. Codex Office in
the U.S. Department of Agriculture (USDA) on all matters related to
Codex. The U.S. Chair of CCRVDF, and the U.S. Delegate to CCRVDF are
FDA employees and have been actively engaged with the U.S. Codex
Office, the Foreign Agriculture Service, and the U.S. Trade
Representative to reach out to other countries on this issue.
food marketing guidelines
Question. In December 2009, the Federal Trade Commission (FTC),
FDA, USDA, and the Centers for Disease Control and Prevention (CDC)
released a proposal for voluntary guidelines for food advertising to
children and teens. These guidelines applied certain nutrition criteria
to advertising during television programs that are viewed by children
and teens. Some have complained that the proposal would prohibit the
marketing of products that clearly fit within USDA and FDA's dietary
guidelines.
To what extent was FDA involved in the development of these
guidelines?
Answer. The committee reports that accompanied the 2009 Omnibus
Appropriations Act included a provision calling for the establishment
of an Interagency Working Group on Food Marketed to Children, made up
of members from FDA, CDC, USDA, and FTC. The FDA representative to this
working group was the Director of the Office of Nutrition, Labeling,
and Dietary Supplements, at the Center for Food Safety and Applied
Nutrition.
In 2009, the working group met and held conference calls. The FDA
representative worked to ensure that the working group understood the
FDA nutrition labeling requirements and policies, and the FDA
representative drew upon the technical expertise of FDA staff as
necessary.
The working group's discussions in 2009 on nutrition principles led
to the development of the guidelines that your question refers to.
Developing the tentative guidelines was the first phase of preparing a
report to the Congress containing the working group's final findings
and recommendations, as required by the committee reports that
accompanied the 2009 Omnibus Appropriations Act. These guidelines were
a tentative set of recommendations for voluntary nutrition principles.
The voluntary principles were designed to guide industry self-
regulatory efforts to improve the nutritional profile of foods that are
most heavily marketed to children.
These tentative guidelines were made public at a forum hosted by
the FTC in December 2009, entitled ``Sizing Up Food Marketing and
Childhood Obesity.'' At the forum, the FDA representative joined
representatives from the other participating agencies to discuss the
standards that the working group had tentatively agreed to. Throughout
2010, the working group met to refine the voluntary nutrition
principles based on comments provided at the public forum and based on
newly issued nutrition reports. Once again, the FDA representative and
staff worked to ensure consistency with existing nutrition labeling
requirements and current Federal nutrition policy. The continuing
discussion of the working group has led to the development of a report
on a set of proposed nutrition principles published for comment on the
FTC Web site on April 28, 2011.
Question. Are you aware of any scientific study that directly links
television advertising to obesity?
Answer. The Interagency Working Group evaluated research related to
associations between television viewing, including advertisements, and
childhood obesity. At the forum hosted by FTC in December 2009, the CDC
representative to the working group, from CDC's Division of Nutrition
and Physical Activity, provided data in his presentation from research
on television viewing and links to childhood obesity. The CDC
representative noted that although there is some evidence to suggest an
association between television viewing and childhood obesity, the
Institute of Medicine, part of the National Academies of Science, has
concluded in a report entitled ``Food Marketing to Children and Youth''
that there is insufficient evidence of a causal relationship between TV
advertising to obesity. The primary objective of the Working Group has
been the promotion of children's health through better diet, with
particular, but not sole, emphasis on reducing the incidence of
childhood obesity. The proposed recommendations are therefore designed
to encourage children, through advertising and marketing, to choose
foods that make a meaningful contribution to a healthful diet and
minimize consumption of foods with significant amounts of nutrients
that could have a negative impact on health or weight.
Question. Would these guidelines prohibit the marketing of foods
that you would define as healthy?
Answer. Neither the tentative guidelines on the recommendations for
voluntary nutrition principles issued in December 2009 nor the report
on the proposed nutrition principles that issued in April 2011 prohibit
the marketing of any foods. The nutrition principles in each document
contain recommendations related to advertising practices to guide
industry efforts to improve the nutritional profile of foods marketed
directly to children and to tap into the power of advertising and
marketing to support healthful food choices. Such recommended
principles should not be interpreted as a substitute or a replacement
for any of FDA's food labeling regulations or a change in Federal
dietary guidance for industry (GFI).
The final product of the working group will be a report to the
Congress containing recommendations for voluntary nutrition principles
for industry to consider in advertising practices and not regulations
promulgated by the agencies. Therefore, any guidelines from the working
group would not prohibit the marketing of any foods.
generic drug review
Question. Since the fiscal year 2008 appropriation, funding for the
Office of Generic Drugs (OGD) has increased by 23 percent. However,
during this same time period, the median approval time for generic
drugs has gone from 18.89 months to more than 26 months.
How do you explain this decline in performance?
Answer. FDA used the increased resources to hire more reviewers.
However, it takes several months to train new reviewers and even longer
before new reviewers become fully productive.
In addition, the new and experienced reviewers are dealing with
more complex new drugs that are becoming eligible for generic
competition. Therefore, more time is required to review and approve the
generic drug versions. Also, more resources are required to develop
recommendations and GFI to address complex products.
The number of new generic drug applications submitted to FDA
remains at a high rate of more than 800 per year, compared to just more
than 300 per year a decade ago. Complicating the review is an increase
in the number of new companies, often relying on overseas manufacturing
and bioequivalence testing sites. Approval of applications from new
companies often takes longer as the new companies are less familiar
with FDA requirements.
This review effort makes up only part of the median approval time.
The other part is time that the applications are with the firm to
address deficiencies raised during review. More than 90 percent of the
original generic drug submissions are found deficient. The companies
must address these deficiencies before they can gain approval. The
responses from companies are not always timely due to the companies'
own priorities. Furthermore, there may be multiple review cycles before
approval.
Finally, other postapproval activities compete with FDA's efforts
to review generic drug applications. There are many more marketed
generic drugs products now than ever before. These products must be
monitored to assure the safety of American patients. For example, any
change to an already-approved generic drug must be reported to FDA's
OGD. The growing workload to evaluate these changes competes with the
workload of new generic drug application review.
Question. Specifically, what have we been getting for our
investment in generic drug review?
Answer. The following is a brief summary of just a few of the
benefits of the generic drug review program. For the decade 2000
through 2009, according to a publication from the Generic
Pharmaceutical Association, the use of generic prescription drugs in
place of their brand-name counterparts saved the Nation's healthcare
system more than $824 billion. In fiscal year 2009 alone, the use of
FDA-approved generics saved $139.6 billion.
It is estimated that more than 20 percent of all the drugs products
on the market are only available in generic form. Therefore, generic
drugs play a role in augmenting the supply and sources of drug products
for national emergencies.
In fiscal year 2010, 565 generic drugs were approved or tentatively
approved. In fiscal year 2010, the OGD took 2079 actions on original/
new generic drug applications. These exceeded estimates for the
program.
As of March 2011, OGD has posted more than 800 product-specific
bioequivalence draft GFI documents, including more than 150 that have
been finalized after considering public comments. Approximately 15-30
new GFI documents are posted every quarter. The information that FDA
posts has been responsible for an approximately 75-percent reduction in
the number of bioequivalence inquiries during the past 3 years. This
timely and transparent provision of bioequivalence recommendations
allows all interested parties equal access to information, and OGD
believes the overall quality of submissions has improved.
medical device review
Question. Recently, medical device manufacturers have complained
that FDA's review process is expensive and unpredictable which leads to
costly delays in approval. Many United States-based device companies
have indicated that it makes far more financial sense to apply for
approval and market new medical devices in Europe than in the United
States. This has led some to worry that this sector would relocate to
other countries and focus more intently on developing new products for
marketing in other countries.
Given that FDA missed 30 percent of its device review goals for
fiscal year 2009, I wonder if there is any credence to this concern.
What is your response to this industry complaint?
Answer. Overall, FDA is meeting or exceeding the Medical Device
User Fee Act (MDUFA) performance goals for more than 95 percent of the
more than 4,000 annual device applications subject to these goals. For
example, under the 510(k) program--the pathway used by 90 percent of
the devices we examine each year--FDA completed 90 percent of our
reviews in 90 days or less, which met the applicable goal. FDA also
completed 98 percent of our reviews in 150 days or less, just as we
committed to under MDUFA. For most of the goals FDA is not yet meeting,
our performance has been steadily improving. FDA published more
detailed performance information in FDA's fiscal year 2010 MDUFA
Performance Report to Congress.
The model of the European Union (EU) has important limitations.
Unlike the United States, the EU does not require that a device be
shown to be effective. Moreover, decisions to approve a device in the
EU are made by private companies, called Notified Bodies. There are
more than 70 from which a manufacturer can select and to whom it pays a
fee. Notified Bodies are subject to variable amounts of oversight. The
information on which Notified Bodies make an approval decision is not
made available to the public. In addition, it is difficult to compare
the United States and EU systems because, unlike in the United States,
the EU does not have a centralized, publicly available database of
review performance, summaries of approval decisions, or important
measures of safety, such as adverse event reports.
The European Commission has recognized that the EU model does not
always offer a uniform level of protection of public health. As a
result, it has sought comment on proposals to change the EU model. FDA
believes that the best approach is not to replace the U.S. model, which
has served the American public well, but rather to make the U.S. model
more robust. With this goal in mind, in January 2011 FDA announced 25
actions we will take this year to make our premarket review programs
more predictable, consistent, and transparent. As a further effort to
make the U.S. model more robust, in February we announced our
Innovation Initiative to help bring breakthrough technologies to
patients more quickly.
Question. Could you be doing more outreach with device
manufacturers during the review process to increase review certainty?
Answer. FDA currently conducts interactive reviews on many
submissions. As part of the Medical Device User Fee Amendments of 2007
(MDUFA II) negotiations, FDA agreed to continue to incorporate an
interactive review process. The commitment letter for MDUFA II states:
``The agency will continue to incorporate an interactive review
process to provide for, and encourage, informal communication between
FDA and sponsors to facilitate timely completion of the review process
based on accurate and complete information. Interactive review entails
responsibilities for both FDA and sponsors.''
In response to this commitment, FDA has developed GFI titled,
``Interactive Review for Medical Device Submissions: 510(k)s, Original
PMAs, PMA Supplements, Original BLAs, and BLA Supplements.'' \1,\ \2\
We also added an interactive review log in the Center Tracking System
database and trained Center for Devices and Radiological Health and
Center for Biologics Evaluation and Research staff on interactive
review with sponsors.
---------------------------------------------------------------------------
\1\ PMA refers to premarket approval.
\2\ BLA refers to biologics license application.
---------------------------------------------------------------------------
In addition, as reflected in the public meeting minutes, FDA has
proposed to industry during the Medical Device User Fee Amendments of
2012 (MDUFA III) negotiations to further enhance interactive review by
making mandatory the tracking of interactive review and by establishing
interaction goals for premarket notification, or 510(k), submissions
and for premarket approval submissions. The proposal also included
identifying best practices and incorporating them into a Good Review
Management Practices GFI.
counterfeit drugs
Question. This week, you were on 60 Minutes discussing the $75
billion counterfeit drug industry. During this interview, you stated
that the agency does not know the extent to which counterfeit drugs
have entered the domestic drug supply, but that you are aware that 30-
50 percent of important drugs for public health in certain countries
are counterfeit.
What would it take to get a handle on counterfeit products in the
domestic drug supply?
Answer. Addressing the challenge of counterfeit drugs is an
important challenge and FDA uses a multifaceted approach to address
this challenge. Counterfeiters take steps to avoid detection so it is
very challenging to determine the prevalence of counterfeit drugs in
the domestic drug supply. FDA can only quantify those events that we
discover. FDA believes the U.S. drug supply is one of the safest in the
world due to the closed distribution system and we rely on global
estimates and reports to gauge the relative risk to U.S. consumers.
FDA uses a multilayered approach to minimize the risk of
counterfeit drugs entering the United States and to protect the U.S.
drug supply. FDA works closely with supply chain stakeholders to secure
the product, the supply chain, and distribution of the product by
engaging in public outreach and education, coordinating regulatory
actions with State and other Federal agencies, cooperating
internationally, conducting criminal investigations, and enhancing
enforcement.
A robust track and trace system could help decrease the
opportunities for diversion and counterfeiting by allowing distributors
and pharmacies to authenticate product origin and supply chain by
ensuring that a drug was handled only by legitimate entities. FDA is
working to develop such a system, but implementation by the drug supply
chain is essential to its success.
FDA collaborates with many State and Federal agencies, in addition
to international law enforcement and regulatory bodies to combat
counterfeit drugs. FDA's Office of Criminal Investigations (OCI) works
to identify counterfeit drug manufacturing locations, and prosecutes
those responsible for the manufacturing and distributing of counterfeit
drugs.
Drug counterfeiting is a global problem so FDA is tackling this
issue internationally by actively working with the World Health
Organization and other private and public sector partners to develop
tools, implement strategies, and take action to prevent and detect
counterfeits that threaten the global marketplace and U.S. consumers.
Question. Do you work with industry to find these products?
Answer. FDA collaborates with industry to identify counterfeit drug
products and warn the public once the products are identified. FDA's
OCI collaborates with industry on a regular basis regarding illegal
drug products, including counterfeit drugs. An example of this
collaboration occurred last year when GlaxoSmithKline (GSK) received
several reports of suspected counterfeit over-the-counter weight-loss
product from consumers and GSK notified OCI. GSK worked with FDA to
quickly identify the counterfeit product, warn the public about the
danger of the counterfeit since it contained the wrong active
ingredient, and educate consumers on how to distinguish counterfeit
products from the authentic products. FDA issued two press releases
with important information for consumers which assisted them in
protecting themselves from buying or taking a counterfeit product.
Additionally, OCI successfully identified and prosecuted those
responsible for manufacturing and distributing the counterfeit product.
FDA also has a Counterfeit Alert Network (CAN) a coalition of
health professional and consumer groups. This network also includes
associations that represent distributors and pharmacies. Participants
in the network agree to develop educational information and to rapidly
disseminate important information about confirmed counterfeit products
to their members. The CAN is another way for FDA to engage other parts
of the drug supply chain and share information with healthcare
professionals and consumers so they can identify counterfeit products.
Question. Would you agree that before we move forward with any
proposal to allow Americans to buy drugs from other countries, we
should demonstrate that we can do so safely and do so without
increasing the chances that Americans may get a contaminated or
potentially dangerous or counterfeit medication?
Answer. FDA's main concern with the importation of prescription
drugs is patient safety. Many of the drugs currently being illegally
imported are not FDA-approved and come from unknown sources and foreign
locations that may not be manufacturing the products in accordance with
FDA regulations. In addition, these products may be counterfeit or may
contain potentially harmful ingredients. FDA does not have the same
information for drugs produced and approved for foreign markets or that
are manufactured in foreign facilities not inspected by FDA as we do
for products approved and manufactured for the U.S. market.
Expanding the purchase of drugs from other countries would provide
additional opportunities for counterfeits and other substandard or
contaminated products to enter into the U.S. supply chain. FDA
continues to identify appropriate compliance, enforcement, and
information technology tools to monitor and address unapproved or
otherwise illegally imported drugs. FDA is also developing a risk-model
associated with importation to identify and minimize the risks to
consumers, drug quality, and the supply chain. In addition, FDA is
analyzing and assessing potential policies and operations that could
reduce the risks from allowing foreign-approved drugs into the United
States. This assessment includes exploring policy options that strike a
balance between providing adequate safety measures and reducing costs
to patients.
fda modernization
Question. In February, The Financial Times reported that, ``Barack
Obama has warned that the U.S. Food and Drug Administration is a
candidate for a sweeping revamp amid complaints that it is ill-equipped
to handle biotechnology and advances in medicine. `I've gotten a lot of
commentary about the fact that . . . essentially their model was
designed for the kind of medical devices you see in museums,' the
president said in remarks before a new panel on jobs and
competitiveness. While he was short on details, Mr. Obama singled out
the FDA as an agency that ought to be modernized''.
What changes has the President specifically asked you to initiate?
Answer. The President has directed agencies to review regulations
and other procedures to see if they can withdraw or modify regulations,
or otherwise improve procedures, to reduce regulatory burden and
improve competitiveness, innovation, economic growth, and jobs, while
assuring safety. FDA has identified improvements to regulatory science
as well as other initiatives--such as its Medical Device Innovation
Initiative, the 510(k) Plan of Action, and the voluntary pilot program
by FDA and the Centers for Medicare & Medicaid Services--also referred
to as Parallel Review of Medical Devices--that will help it and the
industries it regulates innovate and remain competitive.
FDA has also identified regulations for revision and is continuing
its review of its rules and procedures to identify additional
opportunities. For example, FDA recently revised its biologics
regulations to permit approval of exceptions or alternative to the
regulation of constituent materials. This action recognizes advances in
the development and manufacture of safe, pure, and potent biological
products that, in some instances, render the existing constituent
materials regulation too prescriptive and unnecessarily restrictive.
FDA will maintain its ongoing review of device classifications to
determine whether devices can be classified to a lower level, which
reduces burdens on industry while maintaining product safety and
efficacy. FDA is also revising its device adverse event reporting
requirements to convert to a more efficient paperless, electronic
system. In addition, FDA is pursuing initiatives to permit electronic
submission of clinical trial data and other information related to
drugs and medical devices, which will create efficiencies for both
industry and FDA.
advisory panels
Question. At advisory panel meetings, FDA reviewers often instruct
the panel on the standards that apply for assessing the safety and
effectiveness of the product at hand. It appears that in the context of
certain advisory panel presentations, FDA reviewers have put forward
standards that differ from regulations and applicable binding
agreements.
What procedures are in place to ensure that FDA review teams'
presentations to panels comply in every respect with the regulations
and applicable binding protocol agreements?
Answer. FDA presentations at panel meetings undergo multiple levels
of review by scientific and supervisory staff to ensure that statements
made by FDA are factually correct. FDA provides information that will
be presented at the meeting to the sponsor of the product under review.
Sponsors may suggest corrections, clarifications, or edits to these
materials in advance of the meeting.
Question. Does a product sponsor have any recourse if the review
staff's presentation to an advisory panel provides incorrect
information to the panel regarding the standards of safety,
effectiveness, or the terms and obligations under a binding protocol
agreement?
Answer. In advance of a panel meeting, the product sponsor has the
opportunity to comment on the review staff's presentation if they have
any concerns. During the meeting, the sponsor may make a request to
address the panel with any concerns it may have related to the material
presented by FDA.
blood testing
Question. I understand FDA is considering whether to require all
blood donations for human transfusion be screened for hepatitis B virus
(HBV) using nucleic acid testing (NAT). The last public discussion on
this issue took place at the April 2009 meeting of FDA's Blood Products
Advisory Committee (BPAC).
What is the agency's current thinking is regarding an HBV NAT
mandate?
Answer. FDA is evaluating and considering the required testing of
blood for transfusion using HBV NATs. FDA currently requires that blood
for transfusion be tested for HBV surface antigen and antibody to HBV
core antigen. FDA brought the issue of testing of human blood for
transfusion by HBV NAT to BPAC on April 1, 2009. The committee
discussed scientific issues related to the risk of HBV transmission by
blood for transfusion. The committee supported routine HBV NAT for
blood donations, and establishment of a minimum sensitivity standard
for the test. Currently, multiplex nucleic acid assay systems that
simultaneously detect human immunodeficiency virus (HIV), hepatitis C
virus (HCV), and HBV are in widespread use for testing blood donations.
Therefore, because HIV and HCV NAT are required by FDA for testing
blood donations, HBV NAT is also already widely performed to test blood
for transfusion.
Question. Is FDA preparing to issue GFI regarding this topic?
Answer. FDA is considering issuing draft GFI for public comment on
the use of HBV NAT to test both blood for transfusion and Source Plasma
for further manufacture into derivatives.
diabetes and obesity drugs
Question. I understand FDA is now requiring additional clinical
trials, including cardiovascular (CV) studies, for new diabetes and
obesity drugs.
What is the agency doing to ensure that changing product
requirements do not get in the way of making better therapies available
to patients?
Answer. For diabetes drugs, new concerns have recently been raised
regarding the CV safety of drugs to treat diabetes. In May 2007, a
meta-analysis of clinical trials of the diabetes drug, Avandia, also
referred to as rosiglitazone, was published that suggested an increased
risk of heart attacks in patients taking this widely used drug. The
controversy surrounding the meta-analysis and other data on the CV
safety of diabetes drugs were discussed at several public advisory
committee meetings. In July 2008, FDA held a 2-day advisory committee
meeting to seek advice from a panel of experts in the field of
endocrinology, cardiology, statistics, and drug safety on the extent of
assessment of CV safety that should be required of new therapies to
treat type-2 diabetes mellitus (T2DM). The panel, by a majority of 14-
to-2, voted in favor of requiring a prospective assessment of CV safety
prior to approval, Subsequently, in September 2010, FDA announced that
it would restrict the use of Avandia in response to data suggesting an
elevated risk of cardiovascular events by requiring a restricted access
program under a risk evaluation and mitigation strategy. In December
2008, FDA issued GFI titled, ``Diabetes Mellitus--Evaluating CV Risk in
New Anti-diabetic Therapies to Treat T2DM.'' This GFI articulates FDA
expectations for CV safety assessment of new drugs to treat T2DM. Under
this GFI, collection of controlled data of new anti-diabetic therapies
for at least 2 years is anticipated.
Regarding obesity drugs, in February 2007, FDA issued a draft GFI
entitled, ``Developing Products for Weight Management.'' The
recommendations provided in the 2007 draft GFI document continue to
guide the development of novel obesity drugs. Significant safety issues
with three recently reviewed obesity drugs--Qnexa, Lorqess, and
Contrave--led FDA to request that the drug sponsors conduct additional
studies. In one case, FDA requested that a cardiovascular safety study
to provide for a more complete benefit-risk assessment.
Question. What has FDA's performance, in terms of months to review
and number of review cycles, been for diabetes and obesity drugs?
Answer. Since the diabetes GFI was issued in December 2008, FDA has
approved three new molecular entity new drug applications (NDAs),
submitted for the treatment of T2DM. Of these three NDAs, two were
approved within their Prescription Drug User Fee Act goal dates for FDA
to complete its review and take an action. All three NDAs were approved
during their first review cycle.
Since 1999, four NDAs for prescription obesity drugs have been
submitted to FDA. Qnexa, Lorqess, and Contrave were all reviewed within
one review cycle and were acted upon within 10 months of submission. In
addition, the drug Rimonabant was reviewed within 10 months of initial
submission in 2005 and was undergoing a second review cycle when the
sponsor withdrew the application.
The prescription obesity drug, orlistat, was approved in 2007 for
use without a prescription. The nonprescription application was
approved following an initial 10-month review cycle and a subsequent 6-
month review cycle.
______
Questions Submitted by Senator Jerry Moran
antibiotics in food production
Question. As discussed by the Food and Drug Administration (FDA) in
draft guidance for industry (GFI) No. 209, ``The Judicious Use of
Medically Important Antimicrobial Drugs in Food-Processing Animals,''
antibiotic drugs, and the drugs' labeled uses, are approved on an
individual basis, utilizing a drug-specific risk assessment. In the
draft GFI, the FDA states that before withdrawing a previously approved
use of an approved drug, Federal law requires the FDA to demonstrate
that ``new evidence . . . shows that a drug is not shown to be safe
under the approved conditions of use.'' Then, once the FDA meets this
initial burden, under Federal law, the drug sponsor is entitled to
demonstrate the drug is still safe for its intended use. Despite this
Federal mandate, it appears that FDA is trying to generally ban the use
of antibiotics for growth promotion, feed efficiency, and certain types
of preventive treatment through the draft GFI. However, the draft GFI
makes no finding in regard to a specific animal drug. Furthermore, the
studies cited by the draft GFI are dated and generally confirm no
direct link between antibiotics used for growth promotion, feed
efficiency, and certain types of preventive treatment and risk to human
health. Has FDA made any specific findings on individual, previously
approved drug applications that demonstrate that animal ``production
uses'' of a specific drug should be withdrawn based on new evidence
that the drug is no longer safe under the approved conditions for use?
If so, how many and for which drugs has it made such a finding?
Answer. No, FDA has not yet made such a finding regarding any
individual, previously approved new animal drug application.
Question. In draft GFI No. 209, ``The Judicious Use of Medically
Important Antimicrobial Drugs in Food-Processing Animals,'' the FDA
states that rather than follow statutory procedures to withdraw an
approved drug use, the FDA will sometimes address issues through an
informal process where it convinces a drug sponsor to voluntarily
withdraw an approved use.
Which drug sponsors of animal antibiotic drugs is the FDA, through
an informal process, currently trying to persuade to withdraw approved
uses of antibiotics for animal growth promotion, feed efficiency, and
preventive treatment? Of these drug sponsors, which approved animal
antibiotic drugs are implicated in the informal withdrawal process?
Answer. As discussed in draft GFI No. 209, the focus of FDA's
concerns are on the use of medically important antimicrobial drugs in
food-producing animals for production purposes, such as to promote
growth or improve feed efficiency. FDA considers uses that are
associated with the treatment, control, or prevention of specific
diseases, including administration through feed and water, to be uses
that are necessary for assuring the health of food-producing animals.
Currently, FDA is conducting outreach to the animal health industry
on this issue. Since publication of draft GFI No. 209, we have been
very encouraged by the interactions we have had to date with key
stakeholders, including the animal health industry, on plans for
implementation. Sponsors of some of our most important antimicrobial
drugs have already initiated discussions with FDA about updating their
animal drug products in a manner consistent with the principles of
draft GFI No. 209. Regarding which specific animal drug products are in
most need of updating, FDA intends to issue additional GFI, which will
provide more specific information on this topic and allow stakeholders
the opportunity to comment on it.
Question. Once draft GFI No. 209 is finalized, which drug sponsors
is the FDA, through an informal process, planning to persuade to
withdraw approved uses of antibiotics for animal growth promotion, feed
efficiency, and preventive treatment? Of these drug sponsors, which
approved animal antibiotic drugs are implicated in the informal
withdrawal process?
Answer. As previously noted, the focus of FDA's concerns are on the
use of medically important antimicrobial drugs in food-producing
animals for production purposes, for example, to promote growth or
improve feed efficiency. FDA considers uses that are associated with
the treatment, control, or prevention of specific diseases, including
administration through feed and water, to be uses that are necessary
for assuring the health of food-producing animals. Also as noted
previously, FDA intends to issue additional GFI, which will provide
more specific information on this topic including identifying which
specific drugs or drug classes are subject to the recommendations
outlined in draft GFI No. 209.
Question. What is the FDA's timeline for publication of the final
GFI for draft GFI No. 209, ``The Judicious Use of Medically Important
Antimicrobial Drugs in Food-Processing Animals''?
Answer. Once review of the comments received on draft GFI No. 209
is complete, FDA plans to issue final GFI implementing draft GFI No.
209. FDA is still developing a timeline for issuance of the final GFI
No. 209. In addition, FDA continues to work collaboratively with other
agencies and FDA stakeholders to develop sound strategies for
implementing the recommendations outlined in the draft GFI.
Question. Has the FDA reviewed and responded to all of the
submitted comments to draft GFI No. 209, ``The Judicious Use of
Medically Important Antimicrobial Drugs in Food-Processing Animals''?
Answer. FDA is nearly finished reviewing the comments received
regarding draft GFI No. 209. FDA is using the comments to assist in
development of the final draft GFI No. 209.
The FDA has requested an increase of nearly $326 million to fund
its Food Safety and Nutrition activities associated with implementation
of the FDA Food Safety Modernization Act (FSMA). I am concerned about
how FDA plans to use these funds to create on-farm production standards
and traceability rules.
Question. First, I would like to know whether the FDA will abide by
the law's exemption from on-farm production standards and traceability
rules for grain commodities and livestock and not interfere with on-
farm decisions made by producers of these agricultural products.
Answer. FDA FSMA contains numerous provisions requiring FDA to
develop more than 50 new regulations, GFI documents, and reports to the
Congress. As FDA is in the process of developing the required
regulations, it is too soon to be able to provide specificity about the
new requirements. However, I can assure you that, as we move forward,
we will certainly be mindful of any exemptions contained in the
statute. We also are committed to continuing to engage all our
stakeholders to gain the information needed to inform our rulemaking
activities and to help the affected industry implement the new food
safety requirements.
Question. Second, I would like the FDA to explain how it plans to
set on-farm production standards for fruits and vegetables. Is FDA
planning on promulgating broad, flexible standards that defer to the
expertise of the individual producer or is FDA planning to promulgate
specific production standards that restrict producer flexibility and
ultimately hamper on-farm innovation?
Answer. FDA is aware of the tremendous diversity in farming
operations and that a one-size-fits-all approach to produce food safety
will not be practicable. FDA is committed to providing operators with
flexibility and innovation in their approaches to on-farm food safety
for their operations. FDA intends to propose a rule containing
requirements that will be commensurate to the hazards and risks
associated with any particular operation.
Question. During the hearing on March 17, 2011, Commissioner
Hamburg noted that she recently appointed a new director for the FDA
Office of Foods and plans to hire additional personnel to assist in
implementation of on-farm production standards and traceability under
the new authorities granted by FDA FSMA. Does FDA plan to hire
individuals with production agriculture experience and education? For
instance, does FDA plan to consider hiring personnel with a degree in
agronomy or other applied agricultural science degrees?
Answer. The authorities granted to FDA under FSMA cover many
disciplines in the area of food safety, including production
agriculture. FDA currently has staff whose expertise is production
agriculture and with degrees in agronomy. FDA is committed to hiring
subject matter experts from any field relevant to its needs, which
would include consideration of individuals with degrees in applied
agricultural sciences.
CONCLUSION OF HEARINGS
Senator Kohl. Thank you very much, Senator Blunt.
And Commissioner Hamburg, you have been great. You have
been very informative. We have had a good discussion on many
issues. I am sure you are looking forward to following it up
with us.
Dr. Hamburg. Yes. Thank you so much.
Senator Kohl. Thank you very much.
The hearing is recessed.
[Whereupon, at 2:58 p.m., Thursday, March 17, the hearings
were concluded, and the subcommittee was recessed, to reconvene
subject to the call of the Chair.]
AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND
RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2012
----------
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
NONDEPARTMENTAL WITNESSES
[The following testimonies were received by the
Subcommittee on Agriculture, Rural Development, Food and Drug
Administration, and Related Agencies for inclusion in the
record. The submitted materials relate to the fiscal year 2012
budget request for programs within the subcommittee's
jurisdiction.]
Prepared Statement of the American Commodity Distribution Association
On behalf of the American Commodity Distribution Association
(ACDA), I respectfully submit this statement regarding the budget
request of the Food and Nutrition Service for inclusion in the
subcommittee's official record. ACDA members appreciate the
subcommittee's support for these vital programs.
We urge the subcommittee to maintain administrative expense funding
for The Emergency Food Assistance Program (TEFAP) at $74.5 million; to
make TEFAP food purchase dollars available for 2 fiscal years; to
approve the administration's budget request for the Commodity
Supplemental Food Program (CSFP) and provide an increase of $5 million
to begin operations in six additional States approved by the U.S.
Department of Agriculture (USDA); and to evaluate alternative
approaches for the Department of Defense (DOD) Fresh Program.
ACDA is a nonprofit professional trade association, dedicated to
the growth and improvement of USDA Commodity Food Distribution Program.
ACDA members include:
--State agencies that distribute USDA-purchased commodity foods;
--agricultural organizations;
--industry;
--associate members;
--recipient agencies, such as schools and soup kitchens; and
--allied organizations, such as anti-hunger groups.
--ACDA members are responsible for distributing more than 1.5 billion
pounds of USDA-purchased commodity foods annually through
programs such as the National School Lunch Program, TEFAP,
Summer Food Service Program (SFSP), CSFP, Charitable
Institution Program, and Food Distribution Program on Indian
Reservations (FDPIR).
the emergency food assistance program administrative funds at $74.5
million, as provided for fiscal year 2009 and fiscal year 2010
We urge the subcommittee to maintain TEFAP administrative funds at
$74.5 million, as provided for fiscal year 2009 and fiscal year 2010
when American Recovery and Reinvestment Act (ARRA) funds were added to
the regular appropriation.
Food banks around the Nation are in great need. The number of
Americans who are turning to food banks for assistance continues to
increase. The Congress appropriated $49.5 million for TEFAP
administrative funds in both fiscal year 2009 and 2010, and through
ARRA, supplemented these amounts with an additional $25 million. These
resources have been used responsibly, and are sincerely appreciated.
Donations to food banks are declining as many individuals and
businesses no longer have the ability to be as supportive as they had
been in the past. ACDA members tell us that unless TEFAP expense funds
are restored to the fiscal year 2009-2010 level, they will have to
accept less food to reduce shipping/warehousing expenses, and will
likely have to cut reimbursement to local distributors. These
reimbursements are key to maintaining distribution sites, especially in
rural distribution sites.
The lower funding level available in fiscal year 2011 has already
had a negative impact. In Wisconsin, this year's lack of administrative
funding to compensate for the increased quantities of bonus commodities
required a mid-year cut in support to Wisconsin's 16 Emergency Feeding
Organizations administrative budgets.
We recognize that States have had the ability to convert a portion
of their food funds to administrative funds, and have done so. We
appreciate this flexibility, but must respectfully point out that even
if this flexibility is continued, TEFAP operators will experience a
significant reduction in available administrative expense funds that
jeopardizes their ability to provide essential food assistance to needy
Americans.
Section 4201 of the Food, Conservation, and Energy Act of 2008
(Public Law 110-246) increased the authorization for TEFAP
administrative expense funds from $60 million to $100 million,
recognizing the need for increased expense funds to responsibly manage
increased TEFAP food supplies. Our request for $74.5 million, is well
within the amounts authorized.
make the emergency food assistance program food dollars available for 2
fiscal years
We urge the subcommittee to make TEFAP food dollars available for 2
fiscal years, as was done under ARRA.
While the agencies of USDA work closely with food banks to provide
as much food for distribution as possible, there are occasions when
food dollars are at jeopardy through no fault of recipient agencies. If
food orders are canceled by either USDA or vendors for any reason near
the end of the Federal fiscal year, State agencies must either purchase
whatever items might be available through USDA, or lose these end-of-
year balances.
At the end of fiscal year 2009 Florida had an ARRA TEFAP balance of
$1.6 million on September 28, 2009, due to the cancellation of cheese
orders that day. Florida's regular TEFAP balance was $218,023. On
September 8, 2009, the TEFAP entitlement balance in New York was just
more than $12,000. On September 28, it was $415,000 due to the
significant cancellations and deletions of truckloads of commodity
foods. On July 28, 2009, New York's ARRA balance was $11,000. On
September 28, it was $481,000. Other ACDA members have told us of
similar experiences in their States.
Food banks are working diligently to use every $1 responsibly
because every $1 is needed. When ARRA was passed, TEFAP food dollars
were allowed to be carried over from fiscal year 2009 to fiscal year
2010. This procedure helped food bank operators to make responsible
decisions and to take maximum advantage of available resources.
We urge the subcommittee to make TEFAP food dollars available for 2
years, and urge the Secretary of Agriculture to allow those States who
made responsible efforts to use their TEFAP food dollars to roll over
to the next fiscal year balances unexpended through no fault of the
TEFAP operator.
funding for the commodity supplemental food program
ACDA supports the fiscal year 2012 budget request of $176,788,000
for CSFP, but urges the subcommittee provide an additional $5 million
to begin CSFP operations in six States that now have USDA-approved
State plans--Connecticut, Hawaii, Idaho, Maryland, Massachusetts, and
Rhode Island. This additional funding would make CSFP available in 45
States. CSFP now serves primarily elderly individuals, many of whom are
homebound. States currently operating CSFP requested 137,276 additional
caseload slots for the current program year, clearly showing the need
for this program.
american commodity distribution association requests the evaluation of
alternative approaches for dod fresh
There is broad consensus that improving the nutritional well-being
of Americans, particularly children, includes increasing fruit and
vegetable consumption, including fresh items. USDA's commodity program
is constrained in its ability to distribute fresh foods.
However, in the 1990s, the Department developed a partner
relationship with DOD to utilize some of the Federal commodity
entitlement for school meal programs to allow school districts to
purchase through the DOD distribution system. This program, DOD Fresh,
was very successful.
Changes in the DOD procurement and distribution program which have
outsourced these procurement activities have had a deleterious effect
on the school program. This change has also created a situation where
each school that participates must pay a fee to access the DOD secure
ordering system.
The Secretary has worked to ameliorate these fees, approximately $3
million per year, in the short term, but this is a temporary fix. We
believe that there may be an alternate approach that will restore the
many benefits of the original DOD Fresh Program.
We once again ask the subcommittee to direct the Secretary to
evaluate alternative approaches for replacing DOD Fresh including, but
not limited to, developing an analog program through the Agricultural
Marketing Service, and report back to the subcommittee on these
options.
We look forward to continuing to partner with you and USDA in the
delivery of these needed services.
______
Prepared Statement of the American Farm Bureau Federation
The American Farm Bureau Federation (AFBF) has identified three
priorities for emphasis and funding for U.S. Department of Agriculture
(USDA) programs in the fiscal year 2012 agriculture spending bill. They
are:
--programs that expand export markets for agriculture;
--programs that promote broadband expansion; and
--programs that further develop renewable energy.
AFBF strongly opposes any cuts to funding for the farm safety net.
Such cuts would break a 5-year commitment made to America's farmers and
ranchers in the 2008 farm bill. Producers have made business decisions
based on this contract with the Government, and to break these
commitments would severely impact the rural economy. The farm bill
discussion should occur when the House and Senate Agriculture
Committees begin hearings and draft legislation for the next farm bill.
programs that expand international markets for agriculture
In order to take full advantage of the market opportunities offered
through trade agreements, AFBF supports funding at authorized levels
for:
--The Foreign Agricultural Service (FAS) to maintain services that
expand agricultural export markets. We urge continued support
for the Office of the Secretary for trade negotiations and
biotechnology resources.
--The Market Access Program, the Foreign Market Development Program,
the Emerging Markets Program, and the Technical Assistance for
Specialty Crops Program that are effective export development
and expansion programs. These programs have resulted in
increased demand for U.S. agriculture and food products abroad
and should be fully funded.
--Public Law 480 programs which serve as the primary means by which
the United States provides needed foreign food assistance
through the purchase of U.S. commodities. In addition to
providing short-term humanitarian assistance, the program helps
to develop long-term commercial export markets.
We support full funding for the following Animal Plant Health
Inspection Service (APHIS) programs:
--The APHIS Plant Protection and Quarantine personnel and facilities,
especially the plant inspection stations, which are necessary
to protect U.S. agriculture from costly pest problems that
enter the United States from foreign lands.
--APHIS trade issues resolution and management activities that are
essential for an effective response when other countries raise
pest and disease concerns (i.e., sanitary and phytosanitary
measures) to prohibit the entry of American products.
--APHIS-Biotechnology Regulatory Services (BRS) that play an
important role in overseeing the permit, notification, and
deregulation process for products of biotechnology. BRS
personnel and activities are essential to ensure public
confidence and international acceptance of biotechnology
products.
Funding for the U.S. Codex Office is essential to developing
harmonized international standards for food and food products. Codex
standards provide uniformity in food rules and regulations by allowing
countries to adopt similar levels of safety protection for consumers
while concurrently facilitating transparency in food trade.
programs that promote broadband expansion
The lack of high-speed, modern Internet service in rural America
prevents rural Americans' access to educational, medical, and business
opportunities, and hampers the economic growth of rural America. We
support funding for loans and grants administered by the Rural
Utilities Service to increase rural broadband capacity and
telecommunications services and to fund the Distance Learning and
Telemedicine Program.
programs that further develop renewable energy
AFBF supports funding for the following programs, which help
farmers and ranchers contribute to our Nation's goal of energy
independence and a cleaner environment.
We support funding the Biomass Crop Assistance Program (BCAP) at
levels authorized by the 2008 farm bill. BCAP provides vital financial
assistance to farmers who produce and transport eligible biomass
feedstocks and helps growers meet the capital-intensive costs of
transitioning to producing new crops and delivering them to market.
Additionally, we support increasing funding for the Renewable
Energy for America Program (REAP). REAP offers grants, guaranteed
loans, and combination grant/guaranteed loans for agricultural
producers to purchase renewable energy systems and energy efficiency
improvements, as well as offers funding for energy audits and
feasibility studies.
AFBF has identified five other areas of importance for USDA
programs in the fiscal year 2012 agriculture spending bill. They are:
--programs that promote conservation;
--programs that strengthen rural communities;
--programs that enhance and improve food safety and protection;
--programs that promote animal health; and
--research priorities.
programs that promote conservation
AFBF supports full funding for working lands programs. In this time
of fiscal constraint, it is imperative to invest in programs that
contribute to the world's production of food and fiber. Farmers and
ranchers have made great strides in conserving our natural resources
and believe that these gains can continue through working lands
programs.
programs that strengthen rural communities
Rural entrepreneurs often lack access to the capital and technical
assistance necessary to start new businesses. These new ventures are
needed for rural communities to sustain themselves and contribute to
our national economy. AFBF supports funding for USDA Rural Development
(RD) programs that foster new business development in rural
communities. These programs include the Value-Added Agricultural
Producer Grants, Rural Innovation Initiative, Rural Microentrepreneur
Assistance Program, and Business and Industry Direct and Guaranteed
Loans.
Many rural communities lack access to the tax base necessary to
provide modern community facilities like nursing homes, fire stations,
and food distribution centers. AFBF supports funding for the
construction, enlargement, or improvement of essential community
facilities in rural areas and small towns through RD's Community
Facility Direct and Guaranteed Loans. The use of Community Facility
Guaranteed Loans encourages synergy between USDA, private lenders, and
local communities.
The Revolving Fund Program grant helps communities acquire safe
drinking water and sanitary, environmentally sound waste disposal
facilities. With dependable water facilities, rural communities can
attract families and businesses that will invest in the community and
improve the quality of life for all residents. We support funding for
this important program.
AFBF supports funding for the Resource Conservation and Development
Program. This vital program supports economic development and resource
protection. This program, in cooperation with rural development
councils, helps local volunteers create new businesses, form
cooperatives, develop marketing and agri-tourism activities, improve
water quality and flood control, improve leadership and other business
skills, and implement renewable energy projects.
AFBF supports continued funding for the Beginning Farmer and
Rancher Development Program, which provides farmers information,
skills, and tools needed to make informed decisions for their
operations, with the goal of enhancing the success of beginning farmers
and ranchers.
AFBF supports full funding for Agriculture in the Classroom, a
national grassroots program coordinated by the USDA. This worthy
program helps students gain a greater awareness of the role of
agriculture in the economy and society, so that they may become
citizens who support wise agricultural policies.
programs that enhance and improve food safety and protection
The continued safety of food is crucial to consumers, as well as
production agriculture and the rest of the food industry. Sufficient,
reliable Federal funding for the Government's food and feed safety and
protection functions is vital to this effort. Agencies responsible for
food safety must have the necessary resources to reasonably establish
safety, especially Food and Drug Administration (FDA) inspections of
imported food. While food imports have increased more than 50 percent
in the past 5 years, the number of FDA food import inspectors has
fallen about 20 percent.
We recommend that adequate funding for food protection at the FDA
and Food Safety Inspection Service (FSIS) be directed to the following
priorities:
--increased education and training of inspectors;
--additional science-based inspection, targeted according to risk;
--effective inspection of imported food and feed products;
--research and development of scientifically based rapid testing
procedures and tools;
--accurate and timely responses to outbreaks that identify
contaminated products, remove them from the market, and
minimize disruption to producers; and
--indemnification for producers who suffer marketing losses due to
inaccurate Government-advised recalls or warnings.
We also support authorized funding of $2.5 million for the Food
Animal Residue Avoidance Databank (FARAD). FARAD aids veterinarians in
establishing science-based recommendations for drug withdrawal
intervals, critical for both food safety and animal health. No other
Government program provides or duplicates the food safety information
FARAD provides to the public. Without the critical FARAD program,
producers may be forced to euthanize animals or dispose of meat, milk,
and eggs due to the lack of withdrawal information.
AFBF opposes the administration's request for new user fees for
inspection activities. Food safety is for the public good and as such,
it is a justified use of public funds.
programs that promote animal health
Tracking infected and exposed animals is critical to protecting
livestock and poultry health through streamlined surveillance and
response. Disease traceability helps to reduce the number of animal
deaths and preserve animal health when outbreaks occur. A traceability
system can limit the number of animal owners impacted by an outbreak
and reduce the economic strain on owners and affected communities, as
well as protect public health.
We support a voluntary animal disease tracking system, but are
concerned about the share of implementation costs that could burden
producers if APHIS is not adequately funded. Providing APHIS Federal
funding of $15 million this year, and strong oversight on the
expenditure of funds, is essential to generate the greatest possible
benefit for animal health and the livestock industry.
We support $5 million for the Veterinary Medicine Loan Repayment
Program (VMLRP) administered by the National Institute for Food and
Agriculture. VMLRP provides veterinary school graduates student-loan
repayment if they agree to work in underserved areas. VMLRP
veterinarians ensure animal health and welfare, while protecting the
Nation's food supply.
AFBF supports $155.5 million for the FDA Center for Veterinary
Medicine (CVM). CVM oversees the safety of animal drugs, feeds, and
biotechnology-derived plant products used as or in animal feed, as well
as biotechnology-derived products used to improve the health or
productivity of animals (including fish).
research priorities
Research funding is critical to the future of American agriculture.
The United Nations' Food and Agriculture Organization predicts that
farmers will have to produce 70 percent more food by 2050 to feed an
additional 2.3 billion people around the globe. This production
challenge likely will have to be met using fewer resources and less
land than is available today. America's farmers are the most efficient
in the world, but without a commitment to further agricultural research
and technological advancement, even America's farmers could be hard-
pressed to meet these challenges. We believe that agricultural research
is vital to the lives of our citizens and the economic well-being of
our Nation, particularly research focused on meeting the growing
challenges of production agriculture.
______
Prepared Statement of the American Indian Higher Education Consortium
On behalf of the American Indian Higher Education Consortium
(AIHEC) and the 32 Tribal Colleges and Universities (TCUs) that compose
the list of 1994 Institutions, thank you for this opportunity to
outline our needs and concerns for fiscal year 2012.
This statement is presented in three parts:
--a summary of our fiscal year 2012 funding recommendations;
--a brief background on TCUs; and
--an outline of the 1994 Institutions' plan for using our land grant
programs to fulfill the agricultural potential of American
Indian communities, and to ensure that American Indians have
the skills and support needed to maximize the economic
potential of their resources.
summary of requests
We respectfully request the following for fiscal year 2012 for our
land grant programs established within the USDA National Institute of
Food and Agriculture (NIFA) and the Rural Development mission area. In
NIFA, we request:
--$5,321,000 for the 1994 Institutions' competitive Extension grants
program;
--$1,805,000 for the 1994 Institutions' competitive Research Grants
program;
--$3,676,000 for the Higher Education Equity Grants;
--an $11,880,000 payment into the Native American Endowment fund; and
--in the Rural Development's Rural Community Advancement Program
(RCAP), that funding for the TCU Essential Community Facilities
Grants program be retained at $3,972,000, the same level that
has been in place since fiscal year 2008, to help the 1994
Institutions to address the critical facilities and
infrastructure needs that advance their capacity to participate
fully as land grant partners.
background on tribal colleges and universities
The first Morrill Act was enacted in 1862 specifically to bring
education to the people and to serve their fundamental needs. Today,
nearly 150 years after enactment of the first land grant legislation,
the 1994 Institutions, as much as any other higher education
institutions, exemplify the original intent of the land grant
legislation, as they are truly community-based institutions.
The Tribal College Movement was launched in 1968 with the
establishment of Dine College, serving the Navajo Nation. Rapid growth
of the TCU Movement soon followed, primarily in the Northern Plains
region. In 1972, six tribally charted colleges established the AIHEC to
provide a support network for member institutions. Today, AIHEC
represents 36 TCUs, operating 76 campuses--32 of which compose the
current list of 1994 Institutions located in 12 States. Each year,
collectively, tribal colleges serve more than 65,000 American Indians
from well more than 250 federally recognized tribes through academic
and community education programs.
The 1994 Institutions are accredited by independent, regional
accreditation agencies and like all institutions of higher education,
must undergo stringent performance reviews to retain their
accreditation status. TCUs serve as community centers by providing
libraries, tribal archives, career centers, economic development and
business centers, public meeting places, and child and elder care
centers. Despite their many obligations, functions, and notable
achievements, TCUs remain the most poorly funded institutions of higher
education in this country. The vast majority of the 1994 Institutions
is located on Federal trust territory. Therefore, States have no
obligation, and in most cases, provide no funding to TCUs. In fact,
most States do not even provide funds to our institutions for the non-
Indian State residents attending our colleges, leaving the TCUs to
assume the per student operational costs for non-Indian students
enrolled in our institutions, accounting for approximately 21 percent
of their student population. This is a significant financial commitment
on the part of TCUs, as they are small, developing institutions and
cannot, unlike their State land grant partners, benefit from economies
of scale--where the cost per student to operate an institution is
reduced by the comparatively large size of the student body.
As a result of 200 years of Federal Indian policy--including
policies of termination, assimilation, and relocation--many reservation
residents live in conditions of poverty comparable to those found in
Third World nations. Through the efforts of TCUs, American Indian
communities are availing themselves of resources needed to foster
responsible, productive, and self-reliant citizens. It is essential
that we continue to invest in the human resources that will help open
new avenues to economic development, specifically through enhancing the
1994 Institutions' land grant programs, and securing adequate access to
information technology.
1994 land grant programs--ambitious efforts to economic potential
In the past, due to lack of expertise and training, millions of
acres on Indian reservations lay fallow, under-used, or had been
developed using methods that caused irreparable damage. The Equity in
Educational Land Grant Status Act of 1994 is addressing this situation
and is our hope for the continued improvement of our reservation lands.
Our current land grant programs remain small, yet very important to us.
It is essential that American Indians explore and adopt new and
evolving technologies for managing our lands. With increased capacity
and program funding, we will become even more fundamental contributors
to the agricultural base of the Nation and the world.
Competitive Extension Grants Programs
The 1994 Institutions' extension programs strengthen communities
through outreach programs designed to bolster economic development;
community resources; family and youth development; natural resources
development; and agriculture; as well as health and nutrition education
and awareness. Without adequate funding the 1994 Institutions' ability
to maintain existing programs and to respond to the many emerging
issues, such as food safety and homeland security, especially on border
reservations, is severely limited. Increased funding is needed to
support these vital programs designed to address the inadequate
extension services that have been provided to Indian reservations by
their respective State programs. Funding for the 1994 Land Grant
Extension programs is extremely modest. The 1994 Institutions have
applied their resourcefulness for making the most of every dollar they
have at their disposal by leveraging funds to maximize their programs
whenever possible. Two examples of effective 1994 Extension programs
include:
--Extension activities at the College of Menominee Nation (Wisconsin)
strengthen the sustainable economic development potential of
the Menominee, Stockbridge-Munsee, Oneida, and Potawatomi
Reservations and surrounding communities by increasing distance
education capacity, conducting needs assessment studies,
providing workshops and training sessions, and offering
strategic planning assistance.
--The Agriculture & Natural Resources Outreach Education Extension
Program at Oglala Lakota College (South Dakota), which is
located in one of the poorest counties in the Nation, utilizes
education to promote the environmentally sound used of
agriculture and natural resources by Lakota people. The program
coordinates activities between the college's Agriculture and
Natural Resources department, reservation schools, other tribal
departments, South Dakota State University, and county
extension programs. Specific issues addressed by the program
include poverty, isolation, health, cultural dissonance, and
land-use practices by Lakota landowners.
To continue and expand highly successful programs at 1994
Institutions, we request that the subcommittee support the President's
fiscal year 2012 budget request for this competitive grants program and
appropriate $5,321,000 to sustain the growth and further success of
these essential community-based extension programs.
1994 Competitive Research Program
As the 1994 Institutions enter into partnerships with 1862/1890
land grant institutions through collaborative research projects,
impressive efforts to address economic development through natural
resource management have emerged. The 1994 Research Grants program
illustrates an ideal combination of Federal resources and TCU-State
institutional expertise, with the overall impact being far greater than
the sum of its parts. We recognize the severe budget constraints under
which the Congress is currently functioning. The $1,805,000
appropriated in fiscal year 2010 is, by any measure, inadequate to
develop capacity and conduct necessary research at our institutions.
The 1994 Research Grants program is vital to ensuring that TCUs may
finally be recognized as full partners in the Nation's land grant
system. Currently, many of our institutions are conducting applied
research, yet finding the resources to continue this research to meet
their communities' needs is a constant challenge. This research
authority opens the door to funding opportunities to maintain and
expand the vital research projects begun at the 1994 Institutions, but
only if adequate funds are secured and sustained. A total research
appropriation of $1,805,000, for which all 32 of the 1994 Institutions
compete, is hugely insufficient. Priority issue areas currently being
studied at the 1994 Institutions include:
--sustainable agriculture and forestry;
--biotechnology and bioprocessing;
--agribusiness management and marketing;
--plant propagation, including native plant preservation for
medicinal and economic purposes;
--animal breeding;
--aquaculture;
--human nutrition (including health, obesity, and diabetes); and
--family, community, and rural development.
For example, the Standing Rock Sioux Reservation, home to Sitting
Bull College and located in North and South Dakota, is often
characterized by high unemployment and health concerns. The college is
conducting a research project to develop a natural beef enterprise on
the reservation that will maximize use of existing natural resources,
allow American Indian students to be actively involved in research and
to produce a healthier agricultural product for the community. This
project combines expertise from Sitting Bull College, North Dakota
State University, and the USDA-ARS Northern Great Plains Research
Laboratory.
We request that the subcommittee continue to fund this program at a
minimum of $1,805,000.
1994 Institutions' Educational Equity Grant Program
This program is designed to assist 1994 Institutions with academic
programs. Through the modest appropriations first made available in
fiscal year 2001, the 1994 Institutions have developed and implemented
courses and programs in natural resource management; environmental
sciences; horticulture; forestry; and food science and nutrition. This
last category is helping to address the epidemic rates of diabetes and
cardiovascular disease that plague American Indian reservations. We
request that the subcommittee support the President's fiscal year 2012
budget by appropriating $3,676,000 to allow the 1994 Institutions to
build upon their course offerings and the successful activities that
have been established.
Native American Endowment Fund
Endowment installments that are paid into the 1994 Institutions'
account remain with the U.S. Treasury. Only the annual interest yield,
less the USDA's administrative fee, is distributed to the 1994
Institutions. The latest annual interest yield for the 1994
Institutions' endowment was $4,266,794 and after USDA-NIFA claimed its
standard 4-percent administrative fee, $4,096,122 was distributed among
the eligible 32 TCU Land Grant Institutions by statutory formula. Once
again, the administrative fee paid to USDA-NIFA to simply make the
funds available for draw down by the eligible 1994 Institutions was
higher than the amount paid to 72 percent of 1994 Institutions.
Endowment payments appropriated increase the size of the corpus
held by the U.S. Treasury and thereby increase the base on which the
annual interest yield is determined. These additional funds would
continue to support faculty and staff positions and program needs
within 1994 agriculture and natural resources departments, as well as
to help address the critical and very expensive facilities needs at
these institutions. For the latest endowment interest distribution, the
median interest payment to 1994 Institutions was $95,894, which is
clearly not sufficient to address curriculum development and
instruction delivery, not to mention the need to address the ongoing
facilities and infrastructure projects at these institutions. In order
for the 1994 Institutions to become full partners in the Nation's land-
grant system, we need the facilities and infrastructure necessary to
fully engage in education and research programs vital to the future
health and well being of our reservation communities.
We respectfully request that the subcommittee again appropriate
$11,880,000 for the fiscal year 2012 endowment payment. Additionally,
we strongly urge the subcommittee to review the USDA-NIFA
administrative fee charged and consider directing the department to
reduce said fee for the Tribal College Endowment program so that more
of these already limited interest funds can be utilized by the 1994
Institutions to conduct essential community-based programs.
Tribal Colleges and Universities Essential Community Facilities Program
(Rural Development)
The President's fiscal year 2012 budget request recommends
eliminating the TCU Essential Community Facilities Grant program. The
administration has stated that the TCUs' grant program should be
eliminated because tribal colleges are eligible to participate in other
programs offered in the USDA's Community Facilities Loan and Grant
Programs (CFLGP). However, eligibility does not portend the level of
success the TCUs might have in securing their much-needed grant
dollars. Before the TCU-specific grant was established, only three of
the 1994 Institutions ever received any funding under CFLGP; in other
words, less than 10 percent of the eligible TCUs were successful in
securing a grant. Additionally, grant opportunities under CFLGP require
non-Federal matching funds at a minimum of 25 percent, which it has
been determined that many of the tribal colleges cannot meet. By
contrast, in fiscal year 2001 when the TCU-specific program was
launched, 22 TCU Land Grant Institutions or almost 70 percent of the
1994 Institutions received grant awards.
We strongly urge the subcommittee to reject the proposal to
eliminate this critical program and to continue to appropriate a
minimum of $3,972,000 each year for the next 5 fiscal years to afford
the 1994 Institutions the means to aggressively address critical
facilities and infrastructure needs, thereby allowing them to better
serve their students and their respective communities.
conclusion
The 1994 Institutions have proven to be efficient and effective
vehicles for bringing educational opportunities to American Indians and
the promise of self-sufficiency to some of this Nation's poorest and
most underserved regions. The modest Federal investment in the 1994
Institutions has already paid great dividends in terms of increased
employment, access to higher education, and economic development.
Continuation of this investment makes sound moral and fiscal sense.
American Indian reservation communities are second to none in their
potential for benefiting from effective land grant programs and, as
earlier stated, no institutions better exemplify the original intent of
the land grant concept than the 1994 Institutions.
We appreciate your support of the 1994 Institutions and recognition
of their role in the Nation's land grant system. We ask you to renew
your commitment to help move our students and communities toward self-
sufficiency and respectfully request your continued support and full
consideration of our fiscal year 2012 appropriations requests.
______
Prepared Statement of the American Public Power Association
The American Public Power Association (APPA) appreciates the
opportunity to submit this statement outlining our fiscal year 2012
funding priorities within the jurisdiction of the Agriculture, Rural
Development, Food and Drug Administration and Related Agencies
Subcommittee. We support increased funding for farm bill title IX
programs, and $308 million for the Commodity Futures Trading Commission
(CFTC).
APPA is the national service organization representing the
interests of more than 2,000 municipal and other State and locally
owned utilities in 49 States (all but Hawaii). Public power utilities
deliver electricity to one of every seven electricity consumers
(approximately 46 million people), serving some of the Nation's largest
cities. However, the vast majority of APPA's members serve communities
with populations of 10,000 people or less.
department of agriculture: title ix programs
APPA supports full funding for programs authorized in title IX of
the 2008 farm bill for energy efficiency, renewable energy and
biofuels. APPA is extremely pleased that the President's budget
provides an additional $36.8 million in addition to the $70 million in
discretionary funding for the Rural Energy for America Program (REAP).
In addition, we request the full authorized level of $5 million for the
Rural Energy Self-Sufficiency Program, and $5 million for the Community
Wood Energy Program for fiscal year 2012.
commodity futures trading commission
APPA supports the President's budget request of $308 million for
CFTC, an 82-percent increase more than fiscal year 2011. As CFTC
continues to implement the Dodd-Frank Wall Street Reform and Consumer
Protection Act of 2010, they will struggle to do so in a timely manner
without the proper staffing levels and technology necessary to complete
rule-makings and implementation. Given the direct effect the rule-
makings will have on public power utilities and consumers, APPA is
supportive of giving the CFTC the resources it needs to complete the
rule-makings quickly and thoroughly.
______
Prepared Statement of the American Society of Plant Biologists
On behalf of the American Society of Plant Biologists (ASPB) we
submit this statement for the official record in support of funding for
agricultural research by the U.S. Department of Agriculture (USDA).
ASPB supports the requested level for USDA's National Institute of Food
and Agriculture (NIFA) in fiscal year 2012, specifically funding the
Agriculture and Food Research Initiative (AFRI) at the requested level
of $325 million. However, ASPB does not support the proposed decrease
of $109 million to the Agricultural Research Service (ARS), and would
ask that funding for ARS be sustained.
This testimony highlights the importance of biology, particularly
plant biology, as the Nation seeks to address vital issues including a
sustainable food supply, energy security, and protecting our
environment. We would like to thank the subcommittee for its
consideration of this testimony and for recognizing that its support of
agricultural research is an important investment in America's future in
this difficult fiscal environment.
food, fuel, environment, and health: plant biology research and
america's future
Plants are vital to our very existence. They harvest sunlight,
converting it to chemical energy for food and feed; they take up carbon
dioxide and produce oxygen; and they are the primary producers on which
all life depends. Indeed, plant biology research is making many
fundamental contributions in the areas of fuel security and
environmental stewardship; the continued and sustainable development of
better foods, fabrics, and building materials; and in the understanding
of basic biological principles that underpin improvements in the health
and nutrition of all Americans. In fact, the 2009 National Research
Council report, ``A New Biology for the 21st Century,'' placed plant
biology at the center of urgent priorities in food, health, and the
environment. For example, one of the challenges outlined in the report
is to generate food plants that can adapt and grow sustainably in
changing environments, which will require enhanced understanding of
plant growth mechanisms, genetically informed plant breeding, and the
advancement of plant genomics.
Plant biology is at the center of numerous scientific breakthroughs
in the increasingly interdisciplinary world of alternative energy
research. For example, interfaces among plant biology, engineering,
chemistry, and physics represent critical frontiers in both basic
biofuels research and bioenergy production. Similarly, with the
increase in plant genome sequencing and functional genomics, the
interface of plant biology and computer science is essential to our
understanding of complex biological systems ranging from single cells
to entire ecosystems.
Despite the fact that plant biology research--the kind of research
funded by USDA--underpins so many vital practical considerations for
our country, the amount invested in understanding the basic function
and mechanisms of plants is relatively small when compared with the
broader impacts on society and on our economy. Failure to sustain
investment in scientific research jeopardizes the Nation's ability to
maintain U.S. competitiveness in agriculture.
recommendations
Because of our membership's extensive expertise, ASPB is in an
excellent position to articulate the Nation's plant science priorities
as they relate to agriculture. Our recommendations are as follows:
--It is ASPB's hope that USDA will have an elevated role to play as
part of the expanding Federal research landscape. USDA supports
research that is intended to provide a foundation for creating
sustainable food and new energy supplies; however, much higher
investment in competitive funding is needed if the Nation is to
continue to make ground-breaking discoveries and accelerate
progress toward addressing urgent national priorities. ASPB
encourages the appropriation of the requested level of $325
million in fiscal year 2012 for AFRI, which although far short
of the authorized level of $700 million, is sensitive to
today's fiscal environment.
--ARS provides vital research to serve USDA's mission and objectives
and the Nation's agricultural research needs. As USDA begins to
transform its extramural research programs through NIFA, ASPB
asks that the parallel reorganization of the agency's
intramural research programs around the five core challenges
identified by the USDA be carried out with due care and
diligence. Indeed, ASPB supports sustained funding for ARS and
does not support the President's proposed cut of $109 million
to ARS in fiscal year 2012.
--USDA has focused attention in several key priority areas including
childhood obesity, climate change, global food security, food
safety, and sustainable bioenergy. While ASPB appreciates the
need for such strategic focus, ASPB also emphasizes the
importance of robust support for AFRI's Foundational Program as
scientific research supported by this program provides a basis
for outcomes across a wide spectrum, often leading to
groundbreaking developments that cannot be anticipated in
advance.
--ASPB recognizes the importance of competitive grants in fostering
creativity and enabling the research community to take
advantage of new opportunities for discovery and innovation.
With few research funding streams available, there will be
increased pressure on an already limited competitive grants
budget. Therefore, ASPB encourages that any funds eliminated in
congressionally directed spending be applied to the competitive
grants offered as part of AFRI.
--Current estimates predict a significant shortfall in the needed
scientific and engineering workforce as the demographics of the
U.S. workforce change. For example, there is a clear need for
additional scientists in the areas of interdisciplinary energy
research and plant breeding. ASPB applauds the creation of the
NIFA Fellows program. However, given the expected need for
additional scientists and engineers who are well-grounded in
agriculture research and development activities, ASPB calls for
targeted funding of specific programs (e.g., training grants
and fellowships) to provide this needed workforce over the next
10 years and to adequately prepare these individuals for
careers in the agricultural research of the future.
--Considerable research interest is now being paid to the use of
plant biomass for energy production. However, if crops are to
be used to their full potential, considerable effort must be
expended to improve the understanding of their basic biology
and development, as well as their agronomic performance.
Therefore, ASPB calls for additional funding that would be
targeted to efforts to increase the utility and agronomic
performance of bioenergy crops.
--With NIFA now in place, USDA is in a strong position to cultivate
and expand interagency relationships (as well as relationships
with private philanthropies) to take on bolder new initiatives
to address grand challenges related to food, energy, the
environment, and health. ASPB also appreciates the need to
focus resources in key priority areas. However, ASPB emphasizes
continued focus on individual grantees, in addition to group
awards and larger multi-institution partnerships. Truly
paradigm shifting discoveries cannot be predicted through
collaborative efforts alone, and thus, there is a need to
maintain a broad, diverse, and robust research agenda.
Thank you for your consideration of our testimony on behalf of the
American Society of Plant Biologists.
______
Prepared Statement of the Animal Welfare Institute
We would like to preface this testimony by recognizing major steps
the U.S. Department of Agriculture's (USDA's) Animal and Plant Health
Inspection Service (APHIS) has taken recently to improve its
performance. In February, based on an investigation into possible
violations of the Animal Welfare Act (AWA) undertaken by Animal Care
(AC), APHIS, and the Office of Inspector General (OIG), random source
class B dealers Floyd and Susan Martin (doing business as Chestnut
Grove Kennel in Pennsylvania) were indicted on charges of conspiracy,
aggravated identity theft, mail fraud, and making false statements. In
March, three individuals in Tennessee were indicted for conspiring to
violate the Horse Protection Act (HPA) by soring horses, transporting
sored horses, and falsifying paperwork. Also, in March, AC unveiled its
new Animal Care Information System search engine. This new system will
give the public access to key documents, such as information about
licensees and registrants, inspections reports, and annual reports.
This is an important step toward greater transparency and
accountability.
The Congress' support for needed funding for AC, OIG, and
Investigative and Enforcement Services (IES) has made enforcement
improvements possible, and we respectfully request its continued
support for these programs.
usda/animal and plant health inspection service/animal care/animal
welfare act enforcement
Animal Welfare Institute Request: Support Administration's Request for
$30 Million
Over the past decade, the subcommittee has responded to the urgent
need for increased funding for the AC program to improve its
inspections of nearly 16,000 sites, including animal dealers,
commercial breeding facilities, laboratories, zoos, circuses, and
airlines, to ensure compliance with AWA standards. AC now has 130
inspectors (with nine vacancies), and during fiscal year 2010, they
conducted 14,003 inspections, including required annual visits to all
registered research institutions that alone house more than 1 million
animals (excluding birds, rats, and mice). Moreover, AC inspectors are
engaged in follow-up with licensees who are regarded as problems
because of the nature and frequency of their violations.
This budget request of $30 million provides a minimal increase over
fiscal year 2011 needed to sustain the progress that has been made.
animal and plant health inspection service/animal care/horse protection
act enforcement
Animal Welfare Institute Request: Support Administration's Request for
$891,000
The goal of HPA, passed in 1970, is to end the cruel practice of
soring, by which unscrupulous owners and/or trainers, primarily of
Tennessee Walking Horses, intentionally inflict pain on the legs and
hooves of horses, through the application of chemical and mechanical
irritants, to produce an exaggerated gait. In 2008, the American
Association of Equine Practitioners condemned soring as ``one of the
most significant welfare issues faced by the equine industry.'' Three
Girl Scouts bravely documented the brutality of this crime in their
video ``See it Through My Eyes'' (available at www.youtube.com/
watch?v=kqFeYu1CrjU).
Throughout its history, however, the law has been openly flouted
and inadequate funding has hampered enforcement. USDA inspectors are
able to attend a mere fraction of Tennessee Walking Horse shows--
between 6-14 percent. Consequently, there is continued reliance on an
industry-run system of certified Horse Industry Organization inspection
programs that utilize designated qualified persons (DQPs), usually
industry insiders with a history of looking the other way. Reliance on
DQPs has been an abysmal failure. Statistics clearly indicate that the
presence of USDA inspectors at shows results in a far higher rate of
noted violations than occurs when DQPs are present. The greater the
likelihood of a USDA inspection, the greater the deterrent effect on
those who routinely sore their horses. Enforcement should not be
entrusted to individuals with a stake in the status quo.
Given the problems as outlined above and in separate, more detailed
fiscal year 2012 testimony signed by the Animal Welfare Institute and
many other groups, it is clear that USDA cannot make progress in this
area with current funding levels. We ask that the Congress appropriate
the $891,000 for HPA enforcement as provided in the administration's
budget.
animal and plant health inspection service/investigative and
enforcement services
Animal Welfare Institute Request: $17,275,000
IES handles investigations related to enforcement of the laws and
regulations for APHIS' programs, which involves collection of evidence;
both civil and criminal investigations; and investigations carried out
in conjunction with Federal, State, and local enforcement agencies. It
is actively involved in the two high-profile cases noted at the start
of this testimony. In addition, IES, in collaboration with USDA's
Office of the General Counsel, handles other types of enforcement
actions including stipulations and formal administrative proceedings.
We respectfully request a $17.275 million appropriation for IES to
enable the Service to fulfill its full range of responsibilities,
particularly its increasing HPA and AWA investigatory demands.
agricultural research service/national agricultural library/animal
welfare information center
Animal Welfare Institute Request: $1,978,400
We very much appreciate the subcommittee's continuing support for
the Animal Welfare Information Center (AWIC). AWIC's services are
vitally important to the Nation's biomedical research enterprise, as
well as other regulated entities, because they facilitate compliance
with specific requirements of the Federal animal welfare regulations
and policies governing animal-related research. It proves its worth
time and time again.
AWIC was established in 1986 in response to a mandate in the
Improved Standards for Laboratory Animals amendment to AWA. The center
serves as a clearinghouse, training center, and education resource for
those involved in the use of animals for research, testing, and
teaching, as well as other entities covered by AWA. It provides
training and compiles, distributes, and posts on its Web site
information resources from the scientific literature to assist
researchers who use animals. The subjects covered include husbandry,
handling, and care of animals; personnel training; animal behavior;
alternatives; improved methodologies; environmental enrichment; and
pain control via anesthesia and analgesia and other methods. It also
serves as a resource for the wider scientific and agricultural
communities by providing access to material on zoonotic diseases such
as avian influenza, transmissible spongiform encephalopathies,
tuberculosis, West Nile virus, foot and mouth disease, the H1N1 virus,
and others. Its activities contribute significantly to science-based
decisionmaking in animal care.
In fiscal year 2010, staff conducted 13 sessions of AWIC's
workshop, ``Meeting the Information Requirements of the Animal Welfare
Act'' (evaluations of which are overwhelmingly positive, with
participants indicating a high degree of new information acquisition).
In April 2010 in Kansas City, Missouri, AWIC and AC collaborated on a
workshop for AC inspectors to help them better understand the
alternatives requirement of AWA.
The AWIC Web site (http://awic.nal.usda.gov/) is one of the most
accessed sites at the National Agricultural Library (NAL), with more
than 4,322,000 page views during fiscal year 2010. Many improvements to
the Web site have been made in the past year, including increased
timeliness and accessibility through a Twitter account and several
blogs. Currently, 274 full text documents are available on the Web site
and 24 new ones were added in fiscal year 2010. Already completed or in
process for fiscal year 2011 are documents on anesthesia and analgesia
for animals, swine as biomedical models, reducing animal numbers in
research, review of enforcement data, environmental enrichment for
nonhuman primates, cryopreservation of animal embryos, a Google map of
State and local animal control agencies throughout the United States
and issues of the AWIC newsletter. Making this information available in
a timely fashion urgently requires additional staff.
The need and demand for AWIC's services continue to outstrip its
resources. We write in support of an appropriation of $1,978,400, which
is urgently needed to fund, in addition to current salaries and other
expenses, AWIC's services and its ongoing efforts to improve their
delivery, including but not limited to the following:
--$300,000.--Add two full-time equivalents to the professional staff.
--$100,000.--Develop Web-based training modules, including
interactive modules, in order to provide online delivery of
training opportunities and expand the reach of the program.
--$50,000.--Present workshops for research personnel, in
collaboration with AC. The workshops must be free of charge to
the institutions in order to encourage attendance.
--$20,500.--Internet services.
--$10,000.--AWIC staff training.
--$15,000.--To fund an internship program that would provide
opportunities for postgraduate students (including
veterinarians) to work on special projects, such as creating
specialized information resources on animal (especially
zoonotic) diseases.
--$200,000.--Resume acquisition of veterinary publications that NAL
discontinued several years ago, and increase the pace of
indexing all such publications.
--$259,000.--Overhead to the Agricultural Research Service and NAL.
--$50,000.--Meet congressional mandate to digitize more materials; in
particular, scanning historically relevant materials dating
from the 1800s.
--$65,000.--Funding is urgently needed to update Essentials for
Animals in Research, as well as certain animal care manuals,
and then to translate them and AWA and its regulations into
Spanish; develop training DVDs, etc. In the past, this program
yielded very useful products, including the original Essentials
for Animal Research: A Primer for Research Personnel (which was
also translated into Spanish and is still among the top 10
downloaded documents); a video on normal animal behaviors; and
a training video on using animals in research. The growing
numbers of Spanish-speaking animal care personnel in U.S.
research facilities and zoos, as well as increasing interest on
the part of the scientific communities in Central and South
America, have made the availability of Spanish-language
materials a priority.
AWIC's value to the research community and other entities that must
comply with AWA, and to the general public, justifies this modest
proposed increase in its budget.
food safety and inspection service/humane methods of slaughter act
enforcement
Animal Welfare Institute Request: An Additional $2 Million for District
Veterinary Medical Specialists
We appreciate the Congress' support during the past decade for
enforcement of the Humane Methods of Slaughter Act (HMSA). While USDA's
enforcement of the law has increased since 2008, following the exposure
of egregious humane handling and food safety violations at the
Westland-Hallmark plant in California, attention to the issue remains
uneven among Federal regional districts.
An analysis of Humane Activities Tracking System data reveals that
some USDA districts spend 10-20 times the number of hours on humane
enforcement as other districts. Overall, USDA continues to allot an
extremely small percentage of its resources to humane slaughter. For
example, in 2009, only 1.5 percent of Food Safety and Inspection
Service (FSIS) verification procedures were conducted for humane
handling and slaughter, and only 0.5 percent of all noncompliance
records written by FSIS that year were for humane violations.
Repeat violators present a major enforcement problem for FSIS. Of
the 173 federally inspected plants that have been suspended for humane
slaughter violations since January 1, 2005, 32 percent have been
suspended more than once within a 1-year period. Moreover, 15 plants
have been suspended on three or more occasions during the past 3 years.
Federal inspection personnel have inadequate training in humane
enforcement and inadequate access to humane slaughter expertise.
Enforcement documents reveal that inspectors often react differently
when faced with similar violations. District veterinary medical
specialists (DVMSs) are stationed in each district to assist plant
inspectors with humane enforcement and to serve as a liaison between
the district office and headquarters on humane matters. However, the
workload of each of the 15 DVMSs, which includes visiting each meat and
poultry plant within the district to perform humane audits and
conducting verification visits following suspensions, severely limits
the effectiveness of the role.
The problems of inadequate and inconsistent enforcement can be
resolved by increasing the number and qualifications of the personnel
assigned to humane handling and slaughter duties.
The standard for time spent exclusively on HMSA-related inspections
and enforcement should not fall below 140 full-time equivalent
positions. In addition, the number of DVMS positions should be
increased to an average of two per district. Enforcement records
suggest that violations are reported with greater frequency in the
presence of outside inspection personnel, such as DVMSs. Hiring
additional DVMSs will provide for increased auditing and training to
help uncover problems before they result in egregious humane handling
incidents and potential food safety threats to the public.
We thank the subcommittee for this opportunity to present testimony
on behalf of important programs within USDA.
______
Prepared Statement of the Colorado River Basin Salinity Control Forum
The Congress concluded that the Colorado River Basin Salinity
Control Program (CRBSCP) should be implemented in the most cost-
effective way. CRBSCP is funded by the Environmental Quality Incentives
Program (EQIP), the Bureau of Reclamation's (BOR's) Basinwide Program,
and a cost share for both of these programs provided by the Basin
States. Realizing that agricultural on-farm strategies were some of the
most cost-effective strategies, the Congress authorized a program for
the U.S. Department of Agriculture (USDA) through amendment of the
Colorado River Basin Salinity Control Act (CRBSCA) in 1984. With the
enactment of the Federal Agriculture Improvement and Reform Act of 1996
(FAIRA), the Congress directed that CRBSCP should continue to be
implemented as one of the components of EQIP. Since the enactment of
the Farm Security and Rural Investment Act (FSRIA) in 2002, there have
been, for the first time in a number of years, opportunities to
adequately fund CRBSCP within the EQIP. In 2008, the Congress passed
the Food, Conservation, and Energy Act (FCEA). The FCEA addresses the
cost-sharing required from the basin funds. In so doing, the FCEA named
the cost-sharing requirement as the Basin States Program (BSP). The BSP
will provide 30 percent of the total amount that will be spent each
year by the combined EQIP and BSP effort.
CRBSCP, as set forth in CRBSCA, is to benefit lower basin water
users hundreds of miles downstream from salt sources in the upper basin
as the salinity of Colorado River water increases as the water flows
downstream. There are very significant economic damages caused by high
salt levels in this water source. Agriculturalists in the upper basin
where the salt must be controlled, however, don't first look to
downstream water quality standards but look for local benefits. These
local benefits are in the form of enhanced beneficial use and improved
crop yields. They submit cost-effective proposals to the State
conservationists in Utah, Wyoming, and Colorado and offer to cost share
in the acquisition of new irrigation equipment. It is CRBSCA that
provides that the seven Colorado River Basin States will also cost
share with the Federal funds for this effort. This has brought together
a remarkable partnership.
After longstanding urgings from the States and directives from the
Congress, the USDA has concluded that this program is different than
small watershed enhancement efforts common to EQIP. In the case of the
Colorado River salinity control effort, the watershed to be considered
stretches more than 1,200 miles from the river's headwater in the Rocky
Mountains to the river's terminus in the Gulf of California in Mexico
and receives water from numerous tributaries. The USDA has determined
that this effort should receive a special funding designation and has
appointed a coordinator for this multi-State effort.
In recent fiscal years, the Natural Resources Conservation Service
(NRCS) has directed that about $18 million of EQIP funds be used for
CRBSCP. The Colorado River Basin Salinity Control Forum (CRBSCF)
appreciates the efforts of the NRCS leadership and the support of this
subcommittee. The plan for water quality control of the Colorado River
was prepared by CRBSCF, adopted by the States, and approved by the
Environmental Protection Agency (EPA). The Colorado River Basin
Salinity Control Advisory Council has taken the position that the
funding for the salinity control program should not be less than $20
million per year. Over the last few fiscal years, for the first time,
funding has almost reached the needed level. State and local cost-
sharing is triggered by the Federal appropriation. In fiscal year 2012,
it is anticipated that the States will cost share with about $8 million
and local agriculture producers will add more than $7 million. Hence,
it is anticipated that in fiscal year 2012 the State and local
contributions will be about 45 percent of the total program cost.
Over the past few years, the NRCS has designated that about 2.5
percent of the EQIP funds be allocated to CRBSCP. CRBSCF believes this
is the appropriate future level of funding as long as the total EQIP
funding nationwide is more than $1 billion. Funding above this level
assists in offsetting pre-fiscal year 2003 funding below this level.
The Basin States have cost-sharing dollars available to participate in
funding on-farm salinity control efforts. The agricultural producers in
the upper basin are waiting for their applications to be considered so
that they might improve their irrigation equipment and also cost-share
in CRBSCP.
overview
CRBSCP was authorized by the Congress in 1974. The title I portion
of CRBSCA responded to commitments that the United States made, through
a Minute of the International Boundary and Water Commission, to Mexico
specific to the quality of water being delivered to Mexico below
Imperial Dam. Title II of CRBSCA established a program to respond to
salinity control needs of Colorado River water users in the United
States and to comply with the mandates of the then newly enacted Clean
Water Act. This testimony is in support of funding for the title II
program.
After a decade of investigative and implementation efforts, the
Basin States concluded that CRBSCA needed to be amended. The Congress
agreed and made a major revision to CRBSCA in 1984. That revision,
while keeping the Department of the Interior as lead coordinator for
Colorado River Basin salinity control efforts, also gave new salinity
control responsibilities to the USDA. The Congress has charged the
administration with implementing the most cost-effective program
practicable (measured in dollars per ton of salt controlled). It has
been determined that the agricultural efforts are some of the most
cost-effective opportunities.
Since congressional mandates of more than three decades ago, much
has been learned about the impact of salts in the Colorado River
system. BOR has conducted studies on the economic impact of these
salts. BOR recognizes that the damages to United States' water users
alone are hundreds of millions of dollars per year.
CRBSCF is composed of gubernatorial appointees from Arizona,
California, Colorado, Nevada, New Mexico, Utah, and Wyoming. CRBSCF has
become the seven-State coordinating body for interfacing with Federal
agencies and the Congress in support of the implementation of the
salinity control program. In close cooperation with the EPA and
pursuant to requirements of the Clean Water Act, every 3 years CRBSCF
prepares a formal report evaluating the salinity of the Colorado River,
its anticipated future salinity, and the program elements necessary to
keep the salinity concentrations (measured in total dissolved solids)
at or below the levels measured in the river system in 1972 at Imperial
Dam, and below Parker and Hoover Dams.
In setting water quality standards for the Colorado River system,
the salinity concentrations at these three locations in 1972 have been
identified as the numeric criteria. The plan necessary for controlling
salinity and reducing downstream damages has been captioned the ``Plan
of Implementation.'' The 2008 Review of water quality standards
includes an updated Plan of Implementation. In order to eliminate the
shortfall in salinity control resulting from inadequate Federal funding
for a number of years from the USDA, CRBSCF has determined that
implementation of CRBSCP needs to be accelerated. The level of
appropriation requested in this testimony is in keeping with the
agreed-upon plan. If adequate funds are not appropriated, significant
damages from the higher salt concentrations in the water will be more
widespread in the United States and Mexico.
Concentrations of salts in the river cause well more than $300
million in quantified damages and significantly more in unquantified
damages in the United States and result in poorer quality water being
delivered by the United States to Mexico. Damages occur from:
--a reduction in the yield of salt-sensitive crops and increased
water use for leaching in the agricultural sector;
--a reduction in the useful life of galvanized water pipe systems,
water heaters, faucets, garbage disposals, clothes washers, and
dishwashers, and increased use of bottled water and water
softeners in the household sector;
--an increase in the use of water for cooling, and the cost of water
softening, and a decrease in equipment service life in the
commercial sector;
--an increase in the use of water and the cost of water treatment,
and an increase in sewer fees in the industrial sector;
--a decrease in the life of treatment facilities and pipelines in the
utility sector;
--difficulty in meeting wastewater discharge requirements to comply
with National Pollutant Discharge Elimination System permit
terms and conditions, and an increase in desalination and brine
disposal costs due to accumulation of salts in groundwater
basins; and
--increased use of imported water for leaching and cost of
desalination and brine disposal for recycled water.
state cost-sharing and technical assistance
The authorized cost-sharing by the Basin States, as provided by
FAIRA, was at first difficult to implement as attorneys for the USDA
concluded that the Basin States were authorized to cost share in the
effort, but the Congress had not given the USDA authority to receive
the Basin States' funds. After almost 1 year of exploring every
possible solution as to how the cost-sharing was to occur, the States,
in agreement with BOR, State officials in Utah, Colorado, and Wyoming
and with NRCS State conservationists in Utah, Colorado, and Wyoming,
agreed upon a program parallel to the salinity control activities
provided by EQIP wherein the States' cost-sharing funds are being
contributed and used. We now have several years of experience with that
program and with the passage of FCEA we now have a clear authority for
this program that is now known as the Basin States Program.
CRBSCA designates that the Secretary of the Interior provide the
coordination for the Federal agencies involved in the salinity control
program. That responsibility has been delegated to BOR. BOR administers
the Basin States cost-sharing funds that are used in the Basin States
Program.
With respect to the use of Basin States' cost-sharing funds in the
past, the Basin States felt that it was most essential that a portion
of CRBSCP be associated with technical assistance and education
activities in the field. Without this necessary support, there is no
advanced planning, proposals are not well prepared, assertions in the
proposals cannot be verified, implementation of contracts cannot be
observed, and valuable partnering and education efforts cannot occur.
Recognizing these values, it is essential that adequate funds for
technical assistance be provided by USDA and the BSP.
______
Prepared Statement of the Cystic Fibrosis Foundation
On behalf of the Cystic Fibrosis Foundation (CFF) and the
approximately 30,000 people with cystic fibrosis (CF), we are pleased
to submit the following testimony regarding the fiscal year 2012
appropriations for the Food and Drug Administration's (FDA's) review of
rare disease treatments.
about cystic fibrosis
CF is a life-threatening genetic disease for which there is no
cure. People with CF have two copies of a defective gene, known as CF
transmembrane conductance regulator, which causes the body to produce
abnormally thick, sticky mucus that clogs the lungs and results in
fatal lung infections. The thick mucus in those with CF also obstructs
the pancreas, making it difficult for patients to absorb nutrients from
food.
Since its founding, CFF has maintained its focus on promoting
research and improving treatments for CF. More than 30 drugs are now in
development to treat CF; some treat the basic defect of the disease,
while others target its symptoms. Through the research leadership of
CFF, people with CF are living into their thirties, forties, and
beyond. This improvement in the life expectancy for those with CF can
be attributed to research advances and to the teams of CF caregivers
who offer specialized care. Although life expectancy has improved
dramatically, we continue to lose young lives to this disease.
The promise for people with CF lies in research. In the past 6
years, CFF has invested more than $1 billion in its medical programs of
drug discovery, drug development, research, and care focused on life-
sustaining treatments and a cure for CF.
This testimony focuses on the funding the FDA needs to quickly and
efficiently review treatments for CF and other rare diseases so they
can swiftly move into the hands of the patients who need them.
sustaining funding for rare disease drug review at the fda
Cystic Fibrosis Foundation Drug Development Model
CFF has been recognized for its unique research approach, which
encompasses everything from basic research through phase 4
postmarketing drug safety monitoring, and has created the
infrastructure required to accelerate the development of new CF
therapies. As a result, we now have a pipeline of more than 30
potential therapies which are being examined to treat people with CF.
One such treatment is VX-770, a drug being developed by Vertex
Pharmaceuticals that was discovered in collaboration with CFF. This
promising therapy actually targets the genetic defect that causes CF in
patients with a particular mutation of CF, as opposed to only
addressing symptoms of the disease. In late February we learned that
phase 3 clinical trial data of VX-770 showed profound improvements in
lung function and other health measures in CF patients, and a new drug
application is expected to be submitted to the FDA for review later
this year. This new treatment is a direct result of CFF's innovative
research agenda, advancing from bench to bedside through CFF's research
program which speeds the creation of new CF therapies.
Funding for Rare and Orphan Disease Drug Review
In order to encourage the swift review of drugs for CF and other
rare diseases, we urge the subcommittee to recommend sufficient funding
for the FDA, particularly the Center for Drug Evaluation and Research's
(CDER's) Office of New Drugs. Reducing FDA funding to fiscal year 2008
levels, as has been proposed, would set rare drug review and approval
back at a time when effective treatment for some of our most deadly
diseases is sorely needed.
In order to be effective, the FDA needs not only an adequate number
of reviewers of new treatments, but also those with the appropriate
skills and expertise, particularly for rare diseases like CF.
Additional support for the FDA through increased funding not only
assures that the Nation has a safe and effective supply of drugs and
devices, but also that the agency can give the necessary attention to
reviewing treatments that treat small populations but serve specific
unmet medical needs, such as new CF drugs.
The subcommittee and the Congress should be commended for recent
funding increases for the FDA. Nonetheless, the agency continues to
face resource constraints. Its workload has increased due to threats
from bioterrorism and other public health emergencies. Even with
funding increases in recent years, FDA's appropriation supported about
9,100 full-time employees in fiscal year 2010. This is the same
personnel level as 1994, a time in which FDA faced fewer challenges and
its job was considerably less complex.
It is now more critical than ever that the Congress significantly
increase funding for CDER at the FDA and for the agency as a whole in
fiscal year 2012, so that it can meet its statutory obligations to
review drugs for safety and efficacy in a timely manner.
Accelerating the Rare Disease Drug Review Process at the FDA
CFF applauds the FDA, and Associate Director for Rare Diseases Dr.
Anne Pariser in particular, for their attention to rare disease drugs
and sensitivity to the unique challenges posed by the evaluation of
these treatments.
FDA review officials have taken steps to improve their scientific
expertise for review of therapies to treat rare diseases, and FDA
leaders and review staff have been willing to engage in constructive
dialogue to address issues with rare disease review. The agency has
consistently taken part in productive conversations with medical
experts, researchers, clinicians, and patients at CFF, including many
of the foremost experts in the world on CF. This collaboration has
augmented the FDA's work, allowing experts in CF to provide the FDA
with the information it needs to effectively evaluate new treatments
and accelerate the approval process, such as CFF's ongoing research
into the development of improved tools for Patient Reported Outcomes
and measurements of lung function.
However, in many cases the opportunity for public comment is not
available if the product in question is not the subject of an advisory
committee. In all cases, this public comment period occurs very late in
the review process. We recommend that the agency consider establishing
a procedure to receive comment from patients and their physicians
earlier in the process, at the time of the submission of the
investigational new drug application. Receiving such input earlier
might be especially useful in defining and addressing the matter of
unmet medical need. Because orphan diseases are by definition of
limited prevalence, it is generally unlikely that specific expertise in
the disease will be available among FDA staff. For that reason, the
agency should be willing to inform its review process through early
input from experts--both patients and professionals--regarding living
with the disease, treating the disease, and developing therapies for
it.
Additionally, CFF commends the establishment of the new Regulatory
Science Initiative, formed by the National Institutes of Health and the
FDA, with the goal of accelerating the development and use of new
approaches to evaluate drug safety, efficacy, and quality, and urges
the subcommittee to strongly support this type of collaboration.
Support for these types of collaborations throughout the national
health agencies, including programs like the Therapeutics for Rare and
Neglected Diseases Program and the Cures Acceleration Network,
leverages the Federal investment in new research, facilitating swifter
development, and delivery of new medical treatments.
CFF's unique and successful drug development model for creating
treatments for a rare disease has helped create a pipeline with more
than 30 promising drugs to fight CF, and the FDA has played a critical
role in this process, working with CFF as they review treatments and
move them into the hands of those who need them. Encouraged by our
successes, we believe the experience of CFF in clinical research can
serve as a model of drug discovery and development for research on
other orphan diseases and we stand ready to work with the FDA and
congressional leaders. On behalf of CFF, we thank the subcommittee for
its consideration.
______
Prepared Statement of the Federation of American Societies for
Experimental Biology
On behalf of the Federation of American Societies for Experimental
Biology (FASEB), I respectfully request a fiscal year 2012
appropriation of $500 million for the Agriculture and Food Research
Initiative (AFRI) within the National Institute of Food and
Agriculture. This funding level would keep AFRI on a path to its
authorized level of $700 million in the 2008 Food, Conservation, and
Energy Act.
As a federation of 23 scientific societies, FASEB represents more
than 100,000 life scientists and engineers, making it the largest
coalition of biomedical research associations in the United States.
FASEB's mission is to advance health and welfare by promoting progress
and education in biological and biomedical sciences, including the
research funded by AFRI, through service to its member societies and
collaborative advocacy. FASEB enhances the ability of scientists and
engineers to improve--through their research--the health, well-being,
and productivity of all people.
As the Department of Agriculture's principal extramural competitive
grants program, AFRI funds agricultural research, education, and
extension activities critical to improving the Nation's health and
prosperity. In order to optimize the effectiveness of its resources,
the AFRI program facilitates collaborative, interdisciplinary research
that addresses broad societal challenges while expanding the
fundamental understanding of all life sciences. In addition, AFRI
encourages young scientists to undertake agricultural research by
providing grant opportunities for pre- and postdoctoral scholars.
Currently, our Federal investment in competitive agricultural research
is only $262 million. This is woefully inadequate to ensure viability
of a vital industry whose contribution to the economy is more than $300
billion annually. A report by the Economic Research Service found
``strong and consistent evidence'' that investment in agricultural
research has yielded ``high returns per dollar spent,'' citing mean
annual rates of return of 53 percent. Our investment in agricultural
research directly benefits all sectors of society and every geographic
region of the country.
AFRI creates the necessary resources and infrastructure to
efficiently translate scientific discoveries into a broad range of
applications. For example, a team of scientists has identified the
genes that determine why some varieties of wheat are more tolerant to
freezing temperatures than others, enabling researchers to use plant
breeding techniques to accelerate the selection of hardier wheat
plants. By reducing the effect of cold winters on wheat production, the
United States can continue to meet the demands of a growing global
population and remain the world's leading exporter of wheat. AFRI
research also makes critical contributions to improving human health;
scientists studying a bacterial type that commonly causes food
poisoning have determined the mechanism by which it withstands food
safety precautions, such as heating, refrigeration, and chemical
preservatives. Other AFRI-funded researchers have found evidence that a
naturally secreted chemical plays a key role in controlling the
accumulation of fat in humans and animals, a discovery with important
implications for the prevention of obesity-related human diseases and
the agricultural production of leaner, healthier livestock. Strong
funding for AFRI projects like these is also an effective way to
attract outstanding scientists to careers in agricultural research. The
ability of the United States to meet the need for better nutrition, new
biofuels, more efficient agriculture, and a safer food supply will
depend on investment in the agricultural sciences as well as
development and retention of a robust and scientifically diverse
agricultural research workforce. Furthermore, because of the
collaborative work of science agencies and the increasingly
interdisciplinary nature of scientific research, support for the
Federal research and development portfolio has never been more
important to the future of the United States. The solutions to our
Nation's most pressing challenges depend on advances in the
agricultural sciences.
Thank you for the opportunity to offer FASEB's support for AFRI.
______
Prepared Statement of Feeding America
Chairman Kohl, Ranking Member Blunt, and members of the U.S. Senate
Committee on Appropriations, Subcommittee on Agriculture, Rural
Development, Food and Drug Administration, and Related Agencies, thank
you for the opportunity to submit this statement for the record on
behalf of Feeding America. We look forward to the chairman and the
subcommittee's examination of the U.S. Department of Agriculture's
(USDA's) fiscal year 2012 budget request and in particular, the
programs administered by USDA's Food and Nutrition Service.
Feeding America is the Nation's leading domestic hunger-relief
charity with a network of more than 200 food banks in every State
serving more than 61,000 local food assistance agencies. Feeding
America food banks as well as food assistance agencies rely on a
variety of public and private funding streams to feed 37 million
Americans a year, including 14 million children and nearly 3 million
seniors.
During the worst economic downturn since the Great Depression, the
number of American families struggling to make ends meet has increased
significantly. With unemployment still hovering near 9 percent, the
need for food assistance continues to grow and food banks continue to
be pressed to meet the need in their communities. Last year, 37 million
people, or 1-in-8 Americans, received emergency food assistance through
the Feeding America network. This represents an increase of 46 percent
since 2006. As a result, approximately 5.7 million people per week are
now receiving emergency food assistance through Feeding America food
banks.
The food distributed by Feeding America food banks and the
children's and senior's programs our food bank members run in local
communities provide a solid return on taxpayer investments and help
reduce State government and private-sector health costs as well as help
invest in a healthy future workforce. Emergency food assistance
provides support not only to struggling working Americans but also to
farmers and the agriculture industry through purchase of commodities.
While Feeding America receives generous support from our national
and local charitable donors, we would not be able to continue serving
those in need were it not for the food commodities provided by USDA.
Indeed, these commodities comprise approximately 25 percent of all the
food moving through the Feeding America network, and are among some of
the most nutritious foods that our food banks provide. Without this
steady, reliable source of nutritious basic food staples, Feeding
America food banks would simply be unable to continue serving those in
need on a consistent basis.
the emergency food assistance program commodities
The Emergency Food Assistance Program (TEFAP) is a means-tested
Federal program that provides food commodities at no cost to low-income
Americans in need of short-term hunger relief through organizations
like food banks, pantries, soup kitchens, and emergency shelters.
Healthy and nutritious food commodities provided through TEFAP are an
essential resource for the continued success of Feeding America food
banks.
TEFAP commodities currently account for approximately 25 percent of
the food moving through Feeding America food banks. In most instances,
local food banks leverage TEFAP commodities with privately donated
foods to extend TEFAP program benefits beyond the budgeted amount for
the program. As the unprecedented demand for food continues at food
banks across the country, TEFAP commodities are essential for the
provision of a steady emergency food supply.
Unfortunately, the level of commodity support Feeding America
receives from USDA is projected to drop off in fiscal year 2011 and on
into fiscal year 2012. In Federal fiscal year 2010, TEFAP provided
approximately $655 million worth of nutritious foods to low-income
Americans. This figure includes commodity purchases mandated by the
2008 farm bill as well as bonus commodity purchases that were
appropriated for in fiscal year 2010 and those purchases made by USDA
when necessitated by market conditions. Unfortunately though, even as
the need remains at unprecedented levels, if no additional bonus
purchases are made in fiscal year 2011, TEFAP spending levels will fall
to $355 million. This decrease will severely impact efforts to address
the growing need for emergency food assistance. Without additional
funding for commodities, too many Americans may go without adequate
access to the food they need.
While most decisions on TEFAP spending are made either by the
authorizing committee or by the administration, Feeding America urges
this subcommittee to work with the Secretary of Agriculture to identify
ways to increase the supply of TEFAP commodities and to consider making
TEFAP a direct beneficiary of any farm support expenditures that may be
included in a fiscal year 2012 appropriations bill.
the emergency food assistance program administrative grants and
infrastructure grants
In order for States to distribute commodity foods to emergency food
providers and for those providers to get the food to those in need,
Federal funding is appropriated each year to help defray the costs of
storing, transporting, and distributing TEFAP commodities. For the past
several years, despite an authorized spending level of $100 million per
year, the appropriated funding level has remained steady at $50 million
per year.
As food banks are already struggling to respond to a significant
increase in demand, they can no longer afford the rising costs
associated with storing and distributing emergency food commodities
without adequate Federal assistance. While the increase in TEFAP
products that require refrigeration or freezer capacity has been a
welcome addition for clients, these products are costly to store and
deliver across large service areas. Funding TEFAP administrative grants
at the $100 million level authorized in fiscal year 2012 is critical to
helping food banks ensure they can provide a wide variety of nutritious
TEFAP foods to help meet the needs of hungry Americans.
Similarly, TEFAP infrastructure grants, which received $6 million
in appropriations in fiscal year 2010, are essential to helping
emergency food providers meet a variety of infrastructure needs, and
ensuring the effective and efficient delivery of TEFAP foods to those
most in need. Funding provided through this competitive grant program
may be used to help emergency food providers implement, improve, and
expand their infrastructure activities and projects. Specific items
that may be funded include developing computerized systems for tracking
time-sensitive food products; improving the distribution of perishable
foods (such as fresh fruits and vegetables); rescuing prepared,
unserved food; identifying donors and eligible recipients; and
improving facilities and equipment.
In fiscal year 2010, USDA awarded TEFAP Infrastructure Grants to 39
emergency food providers, 19 of whom primarily served low-income
individuals in rural areas. However, USDA had at least four times as
many applicants for these grants as they had funding to award. The 2008
farm bill authorizes $15 million per year in annual appropriations for
this program, and Feeding America urges the subcommittee to provide
full funding for this program in fiscal year 2012 so that even more
emergency food providers can benefit.
commodity supplemental food program
Administered by USDA, the Commodity Supplemental Food Program
(CSFP) leverages Government buying power to provide nutritionally
balanced food packages to more than 604,000 low-income seniors 60 years
or older, pregnant and postpartum women, infants, and children up to 6
years old each month in 39 States, two tribal organizations, and the
District of Columbia. More than 96 percent of those benefiting from
this program are seniors with incomes of less than 130 percent of the
Federal poverty line (approximately $14,000 for a senior living alone).
For many of these seniors, CSFP may be the only nutrition assistance
program readily accessible to them.
CSFP is an efficient and effective program. While the cost to USDA
to provide this package of food is, on average, $20 per month, the
average retail value of the foods in the package is $50. For the
seniors participating in this program, CSFP provides more than just
food and nourishment, it also helps to combat the poor health
conditions often found in seniors who are experiencing food insecurity
and at risk of hunger. According to analysis of data from the 1999-2002
National Health and Nutrition Examination Survey, seniors older than
the age of 60 who are experiencing some form of food insecurity are
significantly more likely to have lower intakes of major vitamins,
significantly more likely to be in poor or fair health, and more likely
to have limitations in activities of daily living. CSFP food packages,
specifically designed to supplement needed sources of nutrients
typically lacking in participants' diets like protein, iron, zinc, and
vitamins B-6 and B-12, can play an important role in addressing the
nutrition needs of low-income seniors.
In fiscal year 2010, CSFP received $171.4 million in appropriated
funds. These funds enabled to program to expand caseload to additional
participants in States and areas with an existing CSFP program and
provided $5 million for seven additional States--Arkansas, Delaware,
Georgia, Maine, New Jersey, Oklahoma, and Utah--to begin CSFP service
for the first time ever. In order to maintain existing caseload in
fiscal year 2012, Feeding America urges the subcommittee to support the
President's CSFP budget request for $176.8 million. In addition, we
urge the subcommittee to provide an additional $5 million to expand the
program into the six additional States (Connecticut, Hawaii, Idaho,
Maryland, Massachusetts, and Rhode Island) with USDA-approved State
plans.
conclusion
We greatly appreciate the opportunity to submit testimony today on
behalf of Feeding America, our more than 200-member food banks, and the
37 million Americans our food banks fed last year. For these growing
numbers of Americans, food banks are truly the first line of defense,
and many times the only resource standing between them being able to
put food on the family dinner table or going to bed with an empty
stomach. However, our food banks and the charitable food assistance
network cannot be expected to meet the needs of these families alone.
It is only through our partnership with the public sector and the
sustained support the Federal Government provides through programs like
TEFAP and CSFP that we can make real strides in the fight against
hunger.
______
Prepared Statement of Friends of Agricultural Research--Beltsville,
Inc.
Mr. Chairman, and members of the subcommittee, thank you for this
opportunity to present our statement supporting funding for the U.S.
Department of Agriculture's (USDA's) Agricultural Research Service
(ARS), and especially for the ARS flagship research facility, the Henry
A. Wallace Beltsville Agricultural Research Center (BARC), in Maryland.
Our organization--the Friends of Agricultural Research--Beltsville
(FAR-B) promotes the center's current and long-term agricultural
research, outreach, and educational missions.
We begin, Mr. Chairman, by citing from Agriculture Secretary Tom
Vilsack's March 10, 2011, remarks before the Senate Appropriations
Subcommittee on Agriculture, Rural Development, Food and Drug
Administration, and Related Agencies. To quote from Secretary's
Vilsack's remarks:
``Scientific research is essential for achieving [our] goals. To
promote American innovation, new discoveries, and new industries, we
continue to target and focus additional research dollars in key areas,
like biofuel feedstocks, livestock and crop production and protection,
ecosystem market foundations, and biotechnology.''
Also:
``We will invest in research to spur innovation, promote exports,
support renewable energy and conservation, and enhance critical
infrastructure in rural communities.''
Our organization could not agree more strongly with Secretary
Vilsack. Writing on world food in the March 14, 2011, Washington Post,
highly regarded columnist Robert J. Samuelson warned, ``the global food
squeeze is largely an uncovered story.'' According to Samuelson, global
food demand is colliding with strained food supplies. Middle East
countries, he notes, are importing 50 percent or more of their wheat,
and looking back from February world wheat prices have doubled in 8
months. Calling the situation the ``Great Food Crunch,'' Samuelson
cites growing affluence leading to higher consumption of meat and dairy
products, and exploding population growth as major contributing
factors. Looking ahead, he notes that from 2010 to 2050 world
population is projected to grow by 38 percent, from 6.9 billion to 9.5
billion.
Can world food production keep pace with growing demand? There are
those who would argue that it cannot. Yet the more hopeful of us take
reassurance in technological advances originating from BARC. Please
consider as recently as 1950 U.S. average corn yields were 38 bushels
per acre. Average wheat yields were 17 bushels per acre. By 2010,
average U.S. corn yields had jumped to 153 bushels per acre, while
average wheat yields grew to an impressive 46 bushels per acre.
Technological discoveries from Beltsville contributed tremendously to
that progress. For decades, Beltsville has stood at the forefront of
technical advances in agriculture. In 2010, the center celebrated 100
years of research accomplishments. The center's landmark technological
achievements over that time are truly remarkable. We would be pleased
to provide documentation should the subcommittee so wish.
Today, Beltsville is unequalled in scientific capability, breadth
of agricultural research program, and concentration of scientific
expertise. Under the leadership of Director Joseph Spence and with its
powerful scientific capability, BARC remains unique and indispensable
to meeting the challenges that lie ahead.
We are aware of the financial constraints facing our country. We
are aware, too, of urgent demands for funding among compelling national
priorities. Securing ample, safe, and nutritious food--food security--
has always been the most compelling of human priorities. That is true
today, and it will be no less so in the years ahead. Commentators such
as Robert Samuelson speculate that as much as oil, scarce food could
shape global politics for decades to come.
In summation, Mr. Chairman, we strongly support adequate funding
for BARC. We would respectively suggest that adequately funding the
USDA's flagship research center is central to maintaining national and
world food security.
priorities in the president's fiscal year 2012 budget request
Now, Mr. Chairman, we turn to key research areas highlighted in the
President's proposed budget. We strongly recommend this proposed
funding. Our recommendation is consistent with the remarks of Secretary
Vilsack.
Animal Breeding and Protection.--$1 million:
--Beltsville has extensive research activity related to animal
production and animal health.
--Research conducted at BARC is the foundation for the dairy industry
in it's research on the genetic prediction of dairy cows that
can more efficiently meet the Nation's dairy needs. Slight
differences in milk production by a cow can mean the difference
between profitability and loss by dairy farmers.
--Research at BARC is aimed at preventing development of resistance
to drugs used for treating cattle for parasites.
Crop Breeding and Protection.--$1 million:
--Beltsville scientists have an extensive record of ongoing research
relating to protecting crops from pests and emerging pathogens.
--Beltsville has unique expertise to identify pathogens such as
nematodes and insects that can destroy crops or make crops
ineligible for export to other countries.
--Beltsville also houses the Germplasm Resource Information Network,
the U.S. coordinating body to identify and catalog plant
germplasm. It is essential to maintain these important
functional operations to identify plant germplasm that is
diseases resistant, drought tolerant, and most valuable to the
consumer.
Child and Human Nutrition.--$4.5 million:
--Beltsville houses the Nation's largest, most comprehensive
federally funded human nutrition research center, the
Beltsville Human Nutrition Research Center (BHNRC).
--Unique activities include the What We Eat in America survey, which
is the Government's nutrition monitoring program and the
National Nutrient Databank, the gold standard reference of food
nutrient content. It is used throughout the world. These two
activities are the basis for food labels, nutrition education
programs, food assistance programs including SNAP, the
Supplemental Nutrition Assistance Program, school feeding
programs, and Government nutrition education programs.
--The research facilities at BHNRC feature unique feeding facilities
and are used in collaboration with other Federal agencies,
including the National Institutes of Health, industry, and
university partners.
--Obesity is a serious problem in the United States and it must be
dealt with. Effective nutrition programs aimed at preventing
the onset of obesity are needed to prevent the high costs of
medical care associated with the epidemic of obesity in this
country.
Global Climate Change.--$800,000:
--Beltsville had been actively engaged in climate change research
long before climate change became a topic of discussion in the
media.
--Beltsville scientists are at the forefront of climate change
research--understanding how climate change affects crop
production and the effects of climate change on growth and
spread of invasive and undesirable plants (such as weeds). A
central aim is finding ways to mitigate effects of climate
change on crops.
--Beltsville houses truly unique facilities for replication of
climates of the past and those that might exist in the future.
Scientists here are able to model the effects of climate change
and to develop strategies to mitigate the effects of any
changes in climate.
Plant, Animal, and Microbial Collections.--$1.25 million:
--BARC houses many truly unique national biological collections that
are indispensable to the well-being of American agriculture. In
addition to the actual collections, BARC scientists are
internationally recognized for their expertise and ability to
quickly and properly identify threats to agriculture.
--This expertise is crucial to preventing loss of crops and animals,
ensuring that threats to American agriculture are identified
before they can enter the country, ensuring homeland security,
and ensuring that American exports are free of pests and
pathogens that could prohibit exports to other countries.
--Collections and expertise include insect pests, fungal pathogens,
bacterial threats, and nematodes.
--BARC houses the National Animal Parasite collection and has the
expertise to identify parasites that are of importance to
agricultural animals.
Mr. Chairman, that concludes our statement. Thank you for
consideration and support for the educational, research, and outreach
missions of BARC.
______
Prepared Statement of the Izaak Walton League of America
The Izaak Walton League of America (IWLA) appreciates the
opportunity to submit testimony concerning appropriations for fiscal
year 2012 for various agencies and programs under the jurisdiction of
the subcommittee. IWLA is a national, nonprofit organization founded in
1922. We have approximately 38,000 members and nearly 300 chapters and
State divisions nationwide. Our members are committed to advancing
common sense policies that safeguard wildlife and habitat, support
community-based conservation, and address pressing environmental
issues. IWLA has been a partner with farmers and a participant in
forming agriculture policy since the 1930s. The following pertains to
conservation programs administered by the U.S. Department of
Agriculture (USDA).
The Food, Conservation, and Energy Act of 2008 (farm bill) was
enacted with a prominent commitment to increased mandatory conservation
spending. It was bipartisan and supported by more than 1,000 diverse
organizations engaged in farm bill policy. We urge the subcommittee to
maintain the mandatory spending levels for conservation programs as
provided in the farm bill. IWLA strongly opposes the administration's
proposal to cut essential conservation programs, placing the farm bill
baseline in jeopardy, in fiscal year 2012 and beyond.
IWLA is also concerned that the administration's budget would not
only deprive farmers and ranchers of conservation and environmental
stewardship assistance in fiscal year 2012, but would also reduce the
farm bill conservation baseline. These programs benefit producers
through improved soil quality and productivity of their land, and the
American people through cleaner air and water and healthy habitat.
Reducing the farm bill baseline in the face of increasing future
demands for resource protection and productivity is counterproductive.
IWLA and its members across the country are especially focused on
the following core conservation programs:
Conservation Reserve Program (CRP).--CRP reduces soil erosion,
protects water quality, and enhances habitat through long-term
contracts with landowners that convert highly erodible cropland to more
sustainable vegetative cover. The administration's budget is strongly
supportive of CRP because it proposes to allow landowners to enroll up
to 6 million acres in fiscal year 2012, on top of the 3.95 million
acres sought in the fiscal year 2011 general signup. After the 2008
farm bill reduced the overall acreage limit for CRP to 32 million
acres--it is encouraging to see the effort being made to ensure farmers
and ranchers are able to achieve the maximum allowable enrollment for
their most sensitive lands and most important habitat.
Wetlands Reserve Program (WRP).--WRP provides technical and
financial assistance to landowners to restore and protect wetlands on
their properties. Wetlands are generally conserved through permanent or
30-year easements purchased by the USDA. Unfortunately, the President
proposes to permanently reduce the farm bill authorization for WRP by
158,895 acres. The action taken with this proposal is to arbitrarily
rewrite the Federal farm bill's multi-year obligation as signed into
law in 2008. IWLA opposes this cut and urges the Congress to uphold the
binding, 5-year commitment made to WRP.
Grassland Reserve Program (GRP).--GRP focuses on limiting
conversion of pasture and other grasslands to cropland or development
while allowing landowners to continue grazing and other operations that
align with this goal. The President's budget also proposes to
permanently cut the mandated total acreage for GRP by 165,684 acres.
Again, IWLA opposes this reduction because it will undermine efforts to
protect one of the country's most threatened natural resources through
fiscal year 2012 and beyond.
Conservation Stewardship Program (CSP).--CSP is a comprehensive
approach to conserving soil, water, and other natural resources across
a range of lands, including cropland, prairie, and forests. CSP makes
conservation the basis for a producer to receive Federal financial
support rather than limitless subsidies for intensive production of a
few crops. It is troubling that the administration's fiscal year 2012
budget is proposing to cut the number of acres that could be enrolled
in CSP by 764,204. IWLA opposes this cut because CSP is a
comprehensive, whole-farm approach to conservation that can maximize
benefits to natural resources, fish and wildlife, and producers alike.
Wildlife Habitat Incentives Program (WHIP).--WHIP helps
agricultural landowners develop habitat for upland wildlife, wetland
wildlife, threatened and endangered species, fish, and other wildlife.
The President's fiscal year 2012 proposal also seeks to permanently
reduce the mandatory commitment established for WHIP in the Federal
farm bill. The budget would cut fiscal year 2012 funding for WHIP by 14
percent, or $12 million. IWLA opposes this damaging cut to a program
with the central goal of supporting wildlife resources in rural
America.
Finally, effective implementation of farm bill conservation
programs depends upon adequate technical resources to work with
landowners in addressing their unique environmental concerns. Although
conservation programs are available, underinvestment in technical
assistance limits agency support to assist farmers and ranchers in
selecting and optimizing appropriate programs for their operations. The
technical expertise of the Natural Resource Conservation Service and
partners that assist in the delivery of programs and technical
assistance directly to landowners is necessary for the adoption and
maintenance of conservation practices. We request that the subcommittee
support the mandatory levels of conservation program funding as
provided in the farm bill to enable robust technical resources to
implement those programs successfully.
We appreciate the opportunity to testify in strong support of fully
funding agricultural conservation programs.
______
Prepared Statement of the National Association of County and City
Health Officials
background
The National Association of County and City Health Officials
(NACCHO) represents the Nation's 2,800 local health departments (LHDs).
These governmental agencies work every day in their communities to
prevent disease, promote wellness, and protect the health of the entire
community. LHDs have a unique and distinctive role and set of
responsibilities in the larger health system and within every
community. The Nation depends upon the capacity of LHDs to play this
role well.
LHDs have wide ranging responsibilities including measuring
population-wide illness, organizing efforts to prevent disease and
prolong quality of life, and to serve the public through programs not
offered elsewhere. Two of those responsibilities are preventing
foodborne illness and investigating the cause and spread of illness. In
fact, LHDs are the significant majority of the 3,000 State, local, and
tribal agencies that have primary responsibility to regulate the more
than 1 million food establishments in the United States.
However, the Nation's current fiscal challenges have diminished the
resources available to, and therefore the ability of, LHDs to focus on
the problem of foodborne illness. NACCHO surveys reveal that in the 3-
year period covering 2008-2010, 29,000 jobs have been lost in LHDs,
which represents a 19-percent cut in local public health jobs
nationwide.
Even so, LHDs continue to respond to increased threats of all
types, from rising chronic disease rates to public anxiety about
potential radiation from the recent disaster in Japan. These increased
threats, combined with budget cuts, layoffs, and furloughs make it more
and more difficult for LHDs to respond to outbreaks of foodborne
illness.
Despite the best efforts of public officials, more than 48 million
cases of preventable foodborne illness occur every year in this
country. Many of these cases cause pain and suffering, high medical
bills, disability, lost productivity, lower life expectancy, and death.
In fact, foodborne illness causes an estimated 128,000 hospital visits
and 3,000 deaths annually.
Last year, the Congress passed historic and bipartisan food safety
legislation. This legislation recognized the importance of protecting
the public from foodborne illness and the shortcomings of our current
system. It is clear that LHDs are facing increasing budget pressures
and that the enormous societal costs imposed by foodborne illness can
be reduced with extremely modest investments in training as well as
regulation and enforcement at the retail level. The return on Federal
investment in retail food safety, training, and enforcement can be
measured in improved health and lower healthcare costs and lost
productivity. It is our members' experience that ``tough but fair''
enforcement is valued by industry.
food and drug administration retail food safety initiative
NACCHO Request: $5.6 Million
President's Fiscal Year 2012 Budget: $5.6 Million (New
Program)
FDA conducted a 10-year study of more than 800 retail food
establishments to determine compliance with five key risk factors for
foodborne illness in nine types of retail operations. These included
schools, hospitals, and nursing homes, as well as markets and
restaurants. This study provides the evidence to support a robust,
science-based approach to food safety at the retail level, where food
is handled, prepared, and stored prior to direct purchase by consumers
and where a significant amount of preventable foodborne illness begins.
LHDs are on the front lines conducting food safety inspections and have
the expertise to educate food handlers in their communities.
The presence of certified food safety managers in retail
establishments is an important factor in achieving overall risk
reduction in food service operations. It is not possible to attribute
improvement in overall compliance with food safety standards to any
single factor, due to the number of interdependent variables with any
given food service operation. However, NACCHO firmly believes that the
comprehensive approach of the Food and Drug Administration's (FDA's)
Retail Food Safety Initiative will significantly enhance the capacity
of LHDs to achieve compliance with improved food safety standards,
thereby reducing the incidence of foodborne illness. NACCHO recommends
a funding level of $5.6 million in fiscal year 2012 to implement this
initiative, which recognizes the critical importance of local food
safety activities to protect the Nation's consumers.
fda food safety training
NACCHO Request: $8 Million
President's Fiscal Year 2012 Budget: $8 Million
Fiscal Year 2010 Funding: $1 Million
It is crucial that regulators and public health partners have the
appropriate knowledge and training to carry out their duties to safe
guard our citizens from foodborne illness. The Congress provided $1
million in fiscal year 2010 appropriations and the International Food
Protection Training Institute (IFPTI) is already up and running.
However, food safety training requires continued funding to increase
capacity and adequately train our Nation's food protection workers. A
national food safety training system, including a certification system,
will ensure that officials at all levels of Government have current,
consistent, and adequate knowledge, as well as the necessary skills, to
do their jobs. Without a robust national training system, we risk
having a food safety workforce applying a patchwork of standards and
methodologies without the ability to consistently and continuously
improve their knowledge and skills based on the latest science and risk
assessments. NACCHO recommends a funding level of $8 million in fiscal
year 2012 to continue to implement an effective food safety training
system.
As you draft the fiscal year 2012 Agriculture, Rural Development,
Food and Drug Administration, and Related Agencies appropriations bill,
we ask that you consider our recommendations for these two programs
that are critical to ensuring the safety of our Nation's food supply
and will protect our Nation's people. NACCHO thanks you for your
previous support of food safety and welcomes the opportunity to discuss
this further with the subcommittee.
______
Prepared Statement of the National Association of State Energy
Officials
Chairman Kohl, Ranking Member Blunt, and members of the
subcommittee, I am Phil Giudice, chairman of the National Association
of State Energy Officials (NASEO). NASEO is submitting this testimony
in support of funding of at least $39 million in discretionary
appropriations for the Rural Energy for America Program (REAP) (section
9007 of the 2008 farm bill) in addition to $70 million in mandatory
funding. REAP was created as part of the 2002 farm bill and it has been
a huge success. Approximately 4,000 clean energy projects have been
implemented in every State since 2003. These activities have included
energy efficiency projects, as well as wind, solar, biomass, anaerobic
digesters, biodiesel, and geothermal. Technical assistance has also
been a big factor in this program. Funding requests are generally three
times the amount of available funds. NASEO has worked with farmers, our
State agricultural agencies, and rural interests to promote this
successful program. As we face dramatically increasing energy bills for
all sectors of the economy (and increased volatility in energy prices),
it is critical that we do more to address the energy problems of rural
America.
Greater energy efficiency and renewable energy use in the farm
sector will help create jobs, increase agricultural productivity, and
improve the environment. Funding for the energy title of the farm bill
is a critical public investment.
______
Prepared Statement of the National Commodity Supplemental Food Program
Association
Mr. Chairman and subcommittee members, thank you for this
opportunity to present information regarding the U.S. Department of
Agriculture (USDA)/Food and Nutrition Service's Commodity Supplemental
Food Program (CSFP).
The National Commodity Supplemental Food Program Association
(NCSFPA) requests the Senate Agriculture Appropriations Subcommittee
fund CSFP for fiscal year 2012 at $207.588 million, $176.788 million as
requested by the USDA, an additional $5 million to begin CSFP
operations in six States (Connecticut, Hawaii, Idaho, Maryland,
Massachusetts, and Rhode Island) with USDA-approved plans, plus $25.8
million to meet pending requests for increasing caseload by 114,000
slots, and include language directing the Department to utilize all
available resources to supplement the CSFP food package and meet the
rising demand for nutritional assistance among our vulnerable senior
population.
CSFP is a unique program that brings together Federal and State
agencies, along with public and private entities. Low-income seniors
added since 1983 now comprise 96 percent of all CSFP participants. The
USDA purchases specific nutrient-rich foods at wholesale prices,
including canned fruits and vegetables, juices, meats, fish, peanut
butter, cereals, grain products, cheese, and dairy products from
American farmers. State agencies provide oversight, contract with
community and faith-based organizations to warehouse and distribute
food, certify eligibility, and educate participants. Local
organizations build broad collaboration among nonprofits, health units,
and area agencies on aging for simple, fast access to these
supplemental foods and nutrition education to improve participants'
health and quality of life. This partnership reaches even homebound
seniors in both rural and urban settings with vital nutrition and
remains an important ``market'' for commodities supported under various
farm programs.
In fiscal year 2010, the CSFP provided services through 150
nonprofit community and faith-based organizations at 1,800 sites
located in 39 States, the District of Columbia, and two Indian tribal
organizations (Red Lake, Minnesota, and Oglala Sioux, South Dakota). On
behalf of those organizations NCSFPA would like to express our
gratitude for the increased fiscal year 2010 funding that has allowed
CSFP to begin in seven new States, Arkansas, Delaware, Georgia, Maine,
New Jersey, Oklahoma, and Utah, and has also resulted in a significant
increase in the number of individuals who are now able to participate
in the program in the other CSFP States.
CSFP's 42 years of service is a testimony to the power of community
partnerships of faith-based organizations, farmers, private industry,
and Government agencies. The CSFP offers a unique combination of
advantages unparalleled by any other food assistance program:
--CSFP specifically targets our Nation's most nutritionally
vulnerable populations--young children and low-income seniors,
many of whom may not qualify for other nutrition assistance
programs.
--CSFP provides a monthly selection of food packages tailored to
specific nutritional needs. The nutritional content of the food
provided has improved with the introduction of low-fat cheese,
whole grain products, canned fruits packed in fruit juice, and
low-salt canned vegetables.
--CSFP purchases foods at wholesale prices, directly supporting
American farmers. The average food package cost is estimated at
$19.26 while the retail value is $50.
--The CSFP involves the entire community. Thousands of volunteers and
private companies donate money, equipment, and, most
importantly, time and effort to deliver food to needy and
homebound seniors. These volunteers not only bring food but
companionship and other assistance to seniors who might have
limited support systems.
In a recent CSFP survey, more than one-half of seniors living alone
reported an income of less than $750 per month. One-half of respondents
from two-person households reported an income under $1,000 per month.
Twenty-five percent were enrolled in the Supplemental Nutrition
Assistance Program (SNAP) and 50 percent said they ran out of food
during the month. Seventy percent of senior respondents said they
choose between medicine and food.
The Senate Agriculture Appropriations Subcommittee has consistently
supported CSFP, acknowledging it as a cost-effective way of providing
nutritious supplemental foods. The Congress provided funding to meet
the rising need among the elderly in the fiscal year 2010
appropriation. While USDA's budget request will provide adequate
resources for our monthly caseload of 604,931 mothers, children, and
seniors, we urge the subcommittee to strongly consider our request for
funding to allow six additional States to begin providing nutritional
assistance to their vulnerable seniors as well as granting us
sufficient funding to meet the increasing need in the 39 current CSFP
States.
CSFP and other nutrition programs, such as SNAP, are only
supplemental programs by design. Together they cover a shortfall that
many seniors face each month. These programs must have support to meet
the increasing need as part of the ``safety net.''
``The Managers fully support continued operation of this program
and recognize the need for a substantial expansion of CSFP . . . the
Managers encourage the Secretary to approve all remaining [S]tates for
expansion and to expand caseload in all participating [S]tates.''
(Joint Statement of Managers, H.R. 2419, the Food, Conservation and
Energy Act of 2008.)
``CSFP has charms worth considering in designing human service
programs . . . the program's trademarks were its simplicity and
accessibility . . . CSFP in particular represents a guaranteed source
of high quality food, delivered in a balanced package.'' (``The Role of
CSFP in Nutritional Assistance to Mothers, Infants, Children and
Seniors'', The Urban Institute, August 2008.)
NCSFPA requests the following:
[In millions of dollars]
------------------------------------------------------------------------
------------------------------------------------------------------------
To continue serving our monthly caseload of 604,931 needy $176.788
seniors (97 percent of participants), women, infants, and
children (3 percent of participants)......................
Respond to six States (Connecticut, Hawaii, Idaho, 5.000
Maryland, Massachusetts, and Rhode Island) requesting
assistance in serving its vulnerable senior population....
To meet the increasing demand/need. Feed an additional 25.800
114,718 at risk seniors in 39 States per requests turned
in to USDA by CSFP operators nationwide...................
------------
Total fiscal year 2012 request....................... 207.588
------------------------------------------------------------------------
A 1997 report by the National Policy and Resource Center on
Nutrition and Aging at Florida International University, Miami--``Elder
Insecurities: Poverty, Hunger, and Malnutrition'' indicated that
malnourished elderly patients experience 2 to 20 times more medical
complications, have up to 100-percent longer hospital stays, and incur
hospital costs $2,000 to $10,000 higher per stay. Proper nutrition
promotes health, treats chronic disease, decreases hospital length of
stay, and saves healthcare dollars. America is aging. CSFP must be an
integral part of senior nutrition policy and plans to support the
productivity, health, independence, and quality of life for America's
seniors, many of whom now need to continue working at least part-time
beyond retirement age to afford basics.
The CSFP is committed grassroots operators and dedicated volunteers
with a mission to provide quality nutrition assistance economically,
efficiently, and responsibly always keeping the needs and dignity of
our participants first. We commend the Food Distribution Division of
Food and Nutrition Service of the USDA for their continued innovations
to strengthen the quality of the food package and streamline
administration.
______
Prepared Statement of the New Mexico Interstate Stream Commission
The Congress authorized the Colorado River Basin Salinity Control
Program (CRBSCP) in the Colorado River Basin Salinity Control Act of
1974 (CRBSCA). The Congress amended the act in 1984 to give new
responsibilities to the U.S. Department of Agriculture (USDA). While
retaining the Department of the Interior as the lead coordinator for
CRBSCP, the amended act recognized the importance of USDA efforts in
meeting the objectives of CRBSCP. Many of the most cost-effective
salinity control projects to date have occurred since implementation of
the USDA's authorization for CRBSCP.
Bureau of Reclamation studies show that quantified damages from the
Colorado River to U.S. water users are about $350 million per year.
Unquantified damages are significantly greater. Damages are estimated
at $75 million per year for every additional increase of 30 milligrams
per liter in salinity of the Colorado River. It is essential that USDA
salinity control projects be funded for timely implementation to
protect the quality of Colorado River Basin water delivered to the
lower Basin States and Mexico.
The Congress directed, with the enactment the Federal Agricultural
Improvement and Reform Act of 1996 (FAIRA), that CRBSCP should continue
to be implemented as a component of the Environmental Quality
Incentives Program (EQIP). However, until 2004, CRBSCP was not funded
at an adequate level to protect the Basin State-adopted and
Environmental Protection Agency (EPA)-approved water quality standards
for salinity in the Colorado River. Appropriations for EQIP prior to
2004 were insufficient to adequately control salinity impacts from
water delivered to the downstream States and Mexico.
EQIP subsumed the salinity control program without giving adequate
recognition to the responsibilities of the USDA to implement salinity
control measures per section 202(c) of CRBSCA. The EQIP evaluation and
project ranking criteria targeted small watershed improvements and did
not recognize that water users hundreds of miles downstream are
significant beneficiaries of the salinity control program. Proposals
for EQIP funding were ranked in the States of Utah, Wyoming, and
Colorado under the direction of the respective State conservationists
without consideration of those downstream, particularly out-of-State,
benefits.
Following recommendations of the Basin States to address the
funding problem, the USDA's Natural Resources Conservation Service
(NRCS) designated the Colorado River Basin an ``area of special
interest'' and earmarked funds for CRBSCP. NRCS concluded that the
salinity control program is different from the small watershed approach
of EQIP. The watershed for CRBSCP stretches more than 1,200 miles from
the headwaters of the river through the salt-laden soils of the upper
basin to the river's termination at the Gulf of California in Mexico.
NRCS is to be commended for its efforts to comply with the USDA's
responsibilities under CRBSCA, as amended. Irrigated agriculture in the
upper basin realizes significant local benefits of improved irrigation
practices, and agricultural producers have succeeded in submitting
cost-effective proposals to NRCS.
Years of inadequate Federal funding for EQIP since the 1996
enactment of FAIRA and prior to 2004 resulted in the need to accelerate
the salinity control program in order to maintain the criteria of the
Colorado River Water Quality Standards for Salinity. With the enactment
of the Farm Security and Rural Investment Act in 2002, an opportunity
to adequately fund the salinity control program now exists. The
requested funding of 2.5 percent of the EQIP funding will continue to
be needed each year for at least the next few fiscal years.
State and local cost-sharing is triggered by and indexed to the
Federal appropriation. In fiscal year 2012, it is anticipated that the
States will cost-share about $8 million and local agricultural
producers will add more than $7 million, resulting in contributions for
more than 40 percent of the total program costs.
USDA salinity control projects have proven to be a cost-effective
component of the salinity control program. USDA has indicated that a
more adequately funded EQIP program would result in more funds being
allocated to the salinity program. The Basin States have cost-sharing
dollars available to participate in on-farm salinity control efforts.
The agricultural producers in the upper basin are willing to cost-share
their portion and are awaiting funding for their applications to be
considered.
The Basin States expend 40 percent of the State funds allocated for
CRBSCP for essential NRCS technical assistance and education
activities. Previously, the Federal part of the salinity control
program funded through EQIP failed to adequately fund NRCS for these
activities, which has been shown to be an impediment to accomplishing
successful implementation of the salinity control program.
Acknowledgement by the administration that technical assistance and
education activities must be better funded has encouraged the Basin
States and local producers that cost-share with EQIP. I request that
adequate funds be appropriated to NRCS technical assistance and
education activities directed to the salinity control program
participants.
I urge the Congress to appropriate at least $1 billion in fiscal
year 2012 for EQIP. Also, I request that 2.5 percent of the EQIP
appropriation be designated for CRBSCP.
______
Prepared Statement of Pickle Packers International, Inc.
The pickled vegetable industry strongly supports and encourages
your subcommittee in its work of maintaining and guiding the
Agricultural Research Service. To accomplish the goal of improved
health and quality of life for the American people, the health action
agencies of this country continue to encourage increased consumption of
fruits and vegetables in our diets. Accumulating evidence from the
epidemiology and biochemistry of heart disease, cancer, diabetes, and
obesity supports this policy. Vitamins (particularly A, C, and folic
acid), minerals, and a variety of antioxidant phytochemicals in plant
foods are thought to be the basis for correlation's between high fruit
and vegetable consumption and reduced incidence of these debilitating
and deadly diseases. The problem is that many Americans choose not to
consume the variety and quantities of fruits and vegetables that are
needed for better health.
As an association representing processors that produce more than 85
percent of the tonnage of pickled vegetables in North America, it is
our goal to produce new products that increase the competitiveness of
U.S. agriculture as well as meet the demands of an increasingly diverse
U.S. population that is encouraged to eat more vegetables. The profit
margins of growers continue to be narrowed by foreign competition.
Likewise, the people of this country represent an ever-broadening array
of expectations, tastes, and preferences derived from many cultural
backgrounds. Everyone, however, faces the common dilemma that food
costs should remain stable and preparation time continues to be
squeezed by the other demands of life. This industry can grow by
meeting these expectations and demands with reasonably priced products
of good texture and flavor that are high in nutritional value, low in
negative environmental impacts, and produced with assured safety from
pathogenic microorganisms and from those who would use food as a
vehicle for terror. With strong research to back us up, we believe our
industry can make a greater contribution toward reducing product costs
and improving human diets and health for all economic strata of U.S.
society.
Many small- to medium-sized growers and processing operations are
involved in the pickled vegetable industry. We grow and process a group
of vegetable crops, including cucumbers, peppers, carrots, onions,
garlic, cauliflower, cabbage (sauerkraut), and Brussels sprouts, which
are referred to as minor crops. None of these crops is in any commodity
program and as such, do not rely upon taxpayer subsidies. However,
current farm value for just cucumbers, onions, and garlic is $2.4
billion with an estimated processed value of $5.8 billion. These crops
represent important sources of income to farmers, and the processing
operations are important employers in rural communities around the
United States. Growers, processing plant employees, and employees of
suppliers to this industry reside in all 50 States. To realize its
potential in the rapidly changing American economy, this industry will
rely upon a growing stream of appropriately directed basic and applied
research from four important research programs within the Agricultural
Research Service. These programs contribute directly to top research
priorities that the Research, Education, and Economic mission area of
the U.S. Department of Agriculture (USDA) has identified in that they
develop vegetable crop germplasm and preservation technology that
contributes to improved profitability with reduced pesticide inputs in
a safer, higher quality product grown by rural farm communities across
the United States, consequently improving food security and food
safety. Improved germplasm, crop management practices, and processing
technologies from these projects have measurably contributed to the
profitability, improved nutritional value, and increased consumption of
affordable vegetable crops for children and adults in America and
around the world.
vegetable crops research laboratory, madison, wisconsin
The USDA/ARS Vegetable Crops Research Lab at the University of
Wisconsin is the only USDA research unit dedicated to the genetic
improvement of cucumbers, carrots, onions, and garlic. Three scientists
in this unit account for approximately one-half of the total U.S.
public breeding and genetics research on these crops. Their past
efforts have yielded cucumber, carrot, and onion cultivars and breeding
stocks that are widely used by the U.S. vegetable industry (i.e.,
growers, processors, and seed companies). These varieties account for
more than one-half of the farm yield produced by these crops today. All
U.S. seed companies rely upon this program for developing new
varieties, because ARS programs seek to introduce economically
important traits (e.g., virus and nematode resistance) not available in
commercial varieties using long-term high risk research efforts. The
U.S. vegetable seed industry develops new varieties of cucumbers,
carrots, onions, and garlic and more than 20 other vegetables used by
thousands of vegetable growers. The U.S. vegetable seed, grower, and
processing industry, relies upon the USDA/ARS Vegetable Crops Research
Lab for unique genetic stocks to improve varieties in the same way the
U.S. healthcare and pharmaceutical industries depend on fundamental
research from the National Institutes of Health. Their innovations meet
long-term needs and bring innovations in these crops for the U.S. and
export markets, for which the United States has successfully competed.
Past accomplishments by this USDA group have been cornerstones for the
U.S. vegetable industry that have resulted in increased profitability,
and improved product nutrition and quality.
Both consumers and the vegetable production and processing industry
would like to see fewer pesticides applied to food and into the
environment in a cost-effective manner. Scientists in this unit have
developed genetic resistance for many major vegetable diseases that are
perhaps the most important threat to sustained production of a
marketable crop for all vegetables. Genetic resistance assures
sustainable crop production for growers and reduces pesticide residues
in our food and environment. Value of this genetic resistance developed
by the vegetable crops unit is estimated at $670 million per year in
increased crop production, not to mention environmental benefits due to
reduction in pesticide use. New research in Madison has resulted in
cucumbers with improved disease resistance, pickling quality, and
suitability for machine harvesting. New sources of genetic resistance
to viral and fungal diseases, environmental stress resistance like heat
and cold, and higher yield have recently been mapped on cucumber
chromosomes to provide a ready tool for our seed industry to
significantly accelerate the development of resistant cultivars for
U.S. growers. Nematodes in the soil deform carrot roots to reduce yield
from 10 percent to more than 70 percent in major production areas. A
new genetic resistance to nematode attack was found to almost
completely protect the carrot crop from one major nematode. This group
improved both consumer quality and processing quality of vegetables
with a resulting increase in production efficiency and consumer appeal.
Baby carrots were founded on germplasm developed in Madison, Wisconsin.
Carrots provide approximately 30 percent of the U.S. dietary vitamin A.
New carrots have been developed with tripled nutritional value, and
nutrient-rich cucumbers have been developed with increased levels of
provitamin A. Using new biotechnological methods, a system for rapidly
and simply identifying seed production ability in onions has been
developed that reduces the breeding process up to 6 years. A genetic
map of onion flavor and nutrition will be used to develop onions that
are more appealing and healthy for consumers.
There are still serious vegetable production problems which need
attention. For example, losses of cucumbers, onions, and carrots in the
field due to attack by pathogens and pests remains high, nutritional
quality needs to be significantly improved and U.S. production value
and export markets could certainly be enhanced. Genetic improvement of
all the attributes of these valuable crops are at hand through the
unique USDA lines and populations (i.e., germplasm) that are available
and the new biotechnological methodologies that are being developed by
the group. The achievement of these goals will involve the utilization
of a wide range of biological diversity available in the germplasm
collections for these crops. Classical plant breeding methods combined
with biotechnological tools such as DNA marker-assisted selection and
genome maps of cucumber, carrot, and onion will be used to implement
these genetic improvements. With this, new high-value vegetable
products based upon genetic improvements developed by our USDA
laboratories can offer vegetable processors and growers expanded
economic opportunities for U.S. and export markets.
u.s. food fermentation laboratory, raleigh, north carolina
The USDA/ARS Food Fermentation Laboratory in Raleigh, North
Carolina is the major public laboratory that this industry looks to for
new scientific information on the safety of our products and
development of new processing technologies related to fermented and
acidified vegetables. Over the years, this laboratory has been a source
for innovations which have helped this industry remain competitive in
the current global trade environment. We expect the research done in
this laboratory to lead to new processing and product ideas that will
increase the economic value of this industry and provide consumers with
safe, high-quality, and healthful vegetable products.
We seek additional funding to support two new research initiatives
for this laboratory that have substantial economic potential for our
industry and health benefits for the American public. These are:
--adaptation of a more efficient heating technology, such as
microwave processing, to replace the current tunnel
pasteurizers in order to reduce the energy and water use
required for heat processing acidified vegetables; and
--development of techniques to deliver living probiotic
microorganisms to consumers in fermented or acidified vegetable
products.
Nearly all pickled vegetables in the aisles of your super market
are heated (pasteurized) so they are shelf stable at room temperature.
Current steam and water bath pasteurizer technologies, which were
developed in the 1940s and 1950s, have been very successful in that
there has never been an outbreak of illness caused by commercially
processed fermented or acidified vegetables. However, these current
processing technologies are not efficient in the use of energy or water
resources. Rising costs for energy and limits on water use require that
major improvements be made in the way we heat process our products.
There are three promising approaches that could benefit the broad range
of products and sizes of companies that constitute the membership of
Pickle Packers International. First, is to develop practical ways to
preheat and pack vegetables to reduce or even eliminate the residence
time required in current pasteurizers. Second, is to adapt newer
thermal processing technologies, particularly microwave heating, to our
products. Third, is to modify containers and product ingredients such
that less heat and associated water use is required to assure killing
of pathogenic bacteria and other spoilage microorganisms. Modifications
of processes require strong scientific justification to assure
ourselves, FDA, and the public that safety and quality will be
maintained. In concert with any new processing technologies adequate
process verification methods to assure process control and acceptance
of our processes by FDA must be developed and validated. The objective
is to have energy-efficient, low water use, and scientifically
validated thermal processing technologies for commercial preservation
of acidified vegetables.
Most of what we hear about bacteria in foods concerns the pathogens
that cause disease. However, lactic acid bacteria are intentionally
grown in fermented foods because they are needed to give foods like
sauerkraut, yoghurt, cheeses, and fermented salami the characteristic
flavors and textures that we desire. There is a growing body of
research to indicate that certain living lactic acid bacteria are
``pro-biotic'' in that they improve human health by remaining in the
intestinal tract after they are consumed. Fermented or acidified
vegetables may be a good way to deliver such probiotic bacteria to
consumers. The objective will be to identify probiotic lactic acid
bacteria that can survive in high numbers in selected vegetable
products and investigate the potential for using vegetables as
healthful delivery vehicles for probiotic organisms.
sugar beet and bean research unit, east lansing, michigan
Quality inspection and assurance for pickling vegetables is needed
at many points from the field through postharvest processing to final
packaging and marketing. Accurate quality assessment methodologies and
techniques are critical to growers and processors and ultimately
consumers of pickling vegetables. While automated quality inspection
systems are currently used in many pickle processing facilities, they
are largely confined to inspecting product surface quality
characteristics. There exists considerable room for improving current
technologies and developing new and more efficient sensors and
automated inspection methods, especially for internal quality
assessment and grading of pickling vegetables and pickled products.
Moreover, labor required for postharvest handling and processing
operations represents a significant portion of the total production
cost. Development of new and/or improved technologies can help growers
and processors assess, inspect, and grade pickling vegetables and
pickled products rapidly and accurately for internal and external
quality characteristics so that they can be directed to, or removed
from, appropriate processing or marketing avenues. This will minimize
postharvest losses of food that has already been produced, ensure high-
quality, consistent final product and end-user satisfaction, and reduce
production cost.
The USDA/ARS Sugarbeet and Bean Research Unit at East Lansing,
Michigan provides national leadership in research and development of
innovative technologies and systems for assessing and assuring quality
and marketability of tree fruits and pickling vegetables and enhancing
production efficiency. Over the years, the Unit has developed a number
of innovative engineering technologies for rapid, nondestructive
measurement and inspection of postharvest quality of tree fruits and
vegetables, including a novel spectral scattering technology for
assessing the texture and flavor of fruits, a portable fruit firmness
tester, and a spectral property measuring instrument for quality
evaluation of fruits and vegetables. Recently, it also developed an
advanced hyperspectral imaging system for automated detection of
internal and external quality of pickling cucumbers and pickles.
Research at East Lansing will continue to provide the pickling
vegetable industry a vital source of innovative inspection and grading
technology to assure high-quality safe products to the marketplace and
achieve labor cost savings. Therefore, it is critical that additional
resources be provided to support and expand the existing program to
effectively address the technological needs for the pickling industry.
u.s. vegetable laboratory, charleston, south carolina
The research program at the USDA/ARS Vegetable Laboratory in
Charleston, South Carolina, addresses national problems in vegetable
crop production and protection with emphasis on the Southeastern United
States. This research program is internationally recognized for its
accomplishments, which have resulted in development of more than 150
new vegetable varieties and lines along with the development of many
new and improved disease and pest management practices.
This laboratory's program currently addresses 14 vegetable crops
including those in the cabbage, cucumber, and pepper families, which
are of major importance to the pickling industry. The mission of the
laboratory is to:
--develop disease and pest-resistant vegetable crops; and
--develop new, reliable, environmentally sound disease and pest
management programs that do not rely on conventional
pesticides.
Continued expansion of the Charleston program is crucial. Vegetable
growers depend heavily on synthetic pesticides to control diseases and
pests. Cancellation and/or restrictions on the use of many effective
pesticide compounds are having a considerable influence on the future
of vegetable crop production. Without the use of certain pesticides,
growers will experience crop failures unless other effective,
nonpesticide control methods are found quickly. The research on
improved, more efficient and environmentally compatible vegetable
production practices and genetically resistant varieties at the U.S.
Vegetable Laboratory continues to be absolutely essential. This gives
U.S. growers the competitive edge they must have to sustain and keep
this important industry and allow it to expand in the face of
increasing foreign competition. Current cucumber varieties are highly
susceptible to a new strain of the downy mildew pathogen; this new
strain has caused considerable damage to commercial cucumber production
in some South Atlantic and Midwestern States during the past 5 years,
and a new plant pathologist position needs to be established to address
this critical situation.
funding needs for the future
It remains critical that funding continues the forward momentum in
pickled vegetable research that the United States now enjoys and to
increase funding levels as warranted by planned expansion of research
projects to maintain U.S. competitiveness. We also understand that
discretionary funds are now used to meet the rising fixed costs
associated with each location. Additional funding is needed at the
Wisconsin and South Carolina programs for genetic improvement of crops
essential to the pickled vegetable industry, and at North Carolina and
Michigan for development of environmentally sensitive technologies for
improved safety and value to the consumer of our products. The
fermented and acidified vegetable industry is receptive to capital
investment in order to remain competitive, but only if that investment
is economically justified. The research needed to justify such capital
investment involves both short-term (6-24 months) and long-term (2-10
years or longer) commitments. The diverse array of companies making up
our industry assumes responsibility for short-term research, but the
expense and risk are too great for individual companies to commit to
the long-term research needed to insure future competitiveness. The
pickled vegetable industry currently supports research efforts at
Wisconsin and North Carolina and anticipates funding work at South
Carolina and Michigan as scientists are put in place. Donations of
supplies and processing equipment from processors and affiliated
industries have continued for many years.
U.S. Vegetable Laboratory, Charleston, South Carolina
New funds are needed to establish a plant pathology position to
address cucumber diseases, especially the disease caused by a new
strain of the downy mildew pathogen that has caused extensive damage to
cucumber production in some South Atlantic and Midwestern States during
the past 5 years. The plant pathologist is needed to characterize
pathogen strains using molecular methodologies and to develop new
management approaches and resistant cucumber lines. This new plant
pathologist position will greatly contribute to the accomplishment of
research that will provide for the effective protection of cucumbers
from disease without the use of conventional pesticides. This position
will require a funding level of $500,000 for its establishment.
------------------------------------------------------------------------
New scientific staff needed Current status Funds needed
------------------------------------------------------------------------
Plant pathologist (cucumber Needed............. $500,000
disease).
---------------
New funds needed............. ................... 500,000
------------------------------------------------------------------------
Food Fermentation Laboratory, Raleigh, North Carolina
The current funding for the laboratory is $1,264,000. To carry out
the new research initiatives to reduce the energy and water use
required to produce safe, high-quality products and to develop systems
to deliver probiotic lactic acid bacteria in acidified and fermented
vegetable products, we request additional support for the Food
Fermentation Laboratory of $300,000 in fiscal year 2012. This will
provide support for postdoctoral or predoctoral research associates
along with necessary equipment and supplies to develop these new areas
of research.
------------------------------------------------------------------------
Scientific staff Current status Funds needed
------------------------------------------------------------------------
Microbiologist..................... Active............. $316,000
Chemist............................ Active............. 316,000
Food technologist/biochemist....... Active............. 316,000
Microbial physiologist............. Active............. 316,000
Fiscal year 2012 postdoctoral and Needed............. 300,000
predoctoral research associate.
---------------
Total funding required....... ................... 1,564,000
---------------
Presidential budget (fiscal year ................... 1,264,000
2012).
---------------
New funds needed............. ................... 300,000
------------------------------------------------------------------------
Vegetable Crops Research Laboratory Unit, Madison, Wisconsin
Current base funding for three scientists is $893,150, of which
$200,000 was added in fiscal year 2002. Emerging diseases, such as
downy mildew of cucumber, threaten production of the crop in all
production areas. Therefore, we request an additional $531,850 to fully
fund the scientists and support staff in fiscal year 2012, including
graduate students and postdoctorates for new research searching for
genetic resistance to emerging diseases.
------------------------------------------------------------------------
Scientific staff in place Current status Funds needed
------------------------------------------------------------------------
Geneticist......................... Active............. $375,000
Geneticist......................... Active............. 375,000
Geneticist......................... Active............. 375,000
Fiscal year 2012 postdoctoral or Needed............. 300,000
predoctoral research associates.
---------------
Total funding required....... ................... 1,425,000
---------------
Presidential budget (fiscal year ................... 893,150
2012).
---------------
New funds needed............. ................... 531,850
------------------------------------------------------------------------
Sugar Beet and Bean Research Unit, East Lansing, Michigan
Current base funding for the location is $190,000, which is far
short of the funding level needed to carry out research on inspection,
sorting, and grading of pickling cucumbers and other vegetable crops to
assure the processing and keeping quality of pickled products. An
increase of $550,000 in the current base funding level would be needed
to fund the research engineer position.
------------------------------------------------------------------------
Scientific staff in place Current status Funds needed
------------------------------------------------------------------------
Postdoctoral research associate.... Active............. $190,000
Research engineer.................. Needed............. 550,000
---------------
Total funding required....... ................... 740,000
---------------
Current funding.................... ................... 190,000
---------------
New funds needed............. ................... 550,000
------------------------------------------------------------------------
Thank you for your consideration and expression of support for the
USDA/ARS.
______
Prepared Statement of the Society for Women's Health Research
The Society for Women's Health Research (SWHR) is pleased to submit
written testimony to urge the subcommittee to increase the
congressional appropriation to the Food and Drug Administration (FDA)
by $382 million for fiscal year 2012. This allocation will allow the
agency to provide necessary and critical improvements in
infrastructure, address resource shortages, and support needed
investment into the Office of Women's Health (OWH), the focal point on
women's health within the agency.
Insufficient investment in this important agency prevents the FDA
from fully achieving its mission and threatens the health, economic,
and national security of the Nation. While SWHR recognizes the need for
responsible discretionary spending, proper and sustained funding of the
FDA must remain a public priority. The administration's fiscal year
2012 increase of $382 million to FDA reflects the agency's increased
responsibilities and workload.
Appropriate funding of the FDA by the Congress is vital for it to
fulfill its mission. Americans rely on the FDA every day, from
promoting wellness and meeting healthcare needs to ensuring the food
supply and keeping drugs safe and effective. Altogether, 25 percent of
every consumer $1 spent in America is spent on products regulated by
the FDA.
This level of investment will allow the FDA to foster a 21st
century culture of proactive science and research leadership that will
better meet the demands and expectations of the American public. Each
year, more than 80 percent of FDA's budget is allocated toward the
salary of its scientists and staff, making a substantial investment in
infrastructure needs, technology, and human collateral all but
impossible. Until the budgetary allocation from the Congress is enough
to allow FDA to invest in staffing and infrastructure needs, the FDA
will continue to act in a reactionary manner against the emerging or
known threats to food and drug security.
fda and sex differences research
In the past decades, scientists have uncovered significant
biological and physiological differences between men and women. Sex
differences have been found everywhere, from the composition of bone
matter to the metabolism of certain drugs, to the rate of
neurotransmitter synthesis in the brain. Sex-based biology, the study
of biological and physiological differences between men and women, has
revolutionized the way that the scientific community views the sexes.
America's drug development process continues to advance in delivering
new and better targeted medications to combat disease; however,
medication effectiveness and safety could be better targeted to women
and men if analysis of sex and gender differences would be done
routinely during review processes at FDA.
SWHR has long recognized that the inclusion of women in study
populations by itself was insufficient to address the inequities in our
knowledge of human biology and medicine, and that only by the careful
study of sex differences at all levels, from genes to behavior, would
science achieve the goal of optimal healthcare for both men and women.
Many sex differences are already present at birth, whereas others
develop later in life. These differences play an important role in
disease susceptibility, prevalence, time of onset, and severity and
have documented roles in cancer, obesity, heart disease, immune
dysfunction, mental health disorders, and other illnesses.
Physiological differences and hormonal fluctuations may also play a
role in the rate of drug absorption, distribution, metabolism,
elimination, as well as ultimate effectiveness of response in females
as opposed to males. This vital research is supported and encouraged by
the OWH at FDA, working directly with the various centers to advance
the science in this area, collaborating on programs, projects, and
research.
Unfortunately, FDA's requirement that the data acquired during
research of a new drug or device's safety and efficacy be reported and
analyzed as a function of sex is not universally enforced.
Information about the ways drugs may differ in various populations
(e.g., women may require a lower dosage because of different rates of
absorption or metabolism) are often unexplored, or female enrollment in
studies is too low to adequately power statistically significant
results. As a result, this information is not able to be transmitted to
healthcare providers and the potential benefit of a more appropriate
medical option is not available to the patient, man or woman.
SWHR believes that the opportunity to translate this information to
patients exists now. Sex differences data discovered from clinical
trials can be presented to the medical community and to patients
through education, drug labeling, and packaging inserts, and other
forms of alerts directed to key audiences. SWHR encourages the FDA to
continue addressing the need for accurate, sex-specific drug and device
labeling to better serve male and female patients, as well as to ensure
that appropriate data analysis of postmarket surveillance reporting for
these differences is placed in the hands of physicians and ultimately
the patient.
fda must improve its information technology infrastructure
The FDA is tasked with guarding the safety, efficacy, and security
of human drugs, biological products, and medical devices, yet still
does not have sufficient resources to establish and maintain the
information technology needed to appropriately analyze the information
that FDA receives. This lack of appropriate information technology (IT)
systems inhibits the FDA from fulfilling its mission and prevents
appropriate sex differences analysis from being conducted. A 2007
Science Board Report, requested by former Commissioner von Eschenbach,
found that FDA's IT systems were inefficient and incapable of handling
the current demands placed on the agency.
Tremendous advances have been made throughout the agency to
modernize in the 4 years since that initial report; however, it still
remains a challenge for the agency to access and maintain the
information technology needed to meet the growing expectations from the
American public and to fulfill its mission. As technology continues to
advance, congressional investment in FDA must remain robust.
FDA is expected by the Congress and the American public to have IT
systems that can quickly and effectively do appropriate data analyses
and reporting, safety analyses, tracking the natural history and
disease models for rare disorders, analyses of subpopulations within
the context of larger trials or comparative effectiveness research
(CER), access large amounts of clinical data, capture emerging trends,
and determine food and drug safety when a problem impacting the public
breaks out.
FDA Must Create a Centralized Database
The creation of a central database would provide a single
repository for all relevant facts about a certain product, including
where, when, and how the product was made. Such a database will be
relevant for all information stored across agencies, so as to maximize
functionality not only of FDA's data but for any other research and
analysis needed by the American public for safety and surveillance.
This database should allow for easier tracking of recruitment and
retention rates of women and minorities in clinical trials, which will
allow the FDA to monitor and collect data on how drugs, devices and
biologics affect men and women differently, and allow for sex
differences to be analyzed during the drug review process.
FDA IT systems must encourage electronic submissions and be able to
handle all applications in an electronic format. FDA must move away
from a paper-based system into a standardized electronic format. This
will aid in transforming agency reviews, CER, and further data analysis
and reporting, such as sex differences.
fda office of women's health
The FDA's OWH, like the agency that houses it, also needs steady
and sustained investment to remain a key resource advocating for this
important research. OWH at the FDA, established in 1994, plays a
critical role in women's health, both within and agency and as an
information source to the public.
OWH's programs, often conducted with the agency centers, focus on
women's health within the FDA and are critical to improving care and
increased awareness of disease-specific impacts on women. OWH works to
ensure that sex and gender differences in the efficacy of drugs (such
as metabolism rates), devices (sizes and functionality) and diagnostics
are taken into consideration in reviews and approvals, but they cannot
fix the problem alone. Additionally, OWH endeavors to correct sex and
gender disparities in the areas for which the FDA has jurisdiction and
also monitors women's health priorities, providing both leadership and
an integrated approach to problem solving across the FDA. OWH continues
to provide women with invaluable tools for their health
To address OWH's growing list of priorities, SWHR recommends that
the Congress support an additional $1 million budget for OWH for fiscal
year 2012 within the budget for the FDA. Each year, OWH exhausts its
budget. OWH's pamphlets are the most requested of any documents at the
Government Printing Office facility in Colorado. More than 5 million
OWH pamphlets have been distributed to women across America, including
target populations such as Hispanic communities, seniors, and low-
income citizens. Last year, the OWH funded more than 18 research
studies on conditions ranging from sex and racial disparities in Swam-
Ganz balloon flotation pulmonary artery catheters to assessment of
outcomes and bleeding complications following drug eluting stents and
dual anti-platelet therapy.
The value-added with congressional investment in FDA's OWH is
clear. The office provides women with the high-quality and timely
information that American women need to make medical decisions on
behalf of them and their families. Further, OWH's Web site is a vital
tool for consumers and is regularly updated to include new and
important health information. The Web site provides free, downloadable
fact sheets on more than 100 different illnesses, diseases, and health-
related issues for women. OWH has created medication charts on several
chronic diseases, listing all the medications that are prescribed and
available for each disease. This type of information is ideal for women
to use in talking to their doctors, pharmacists, or nurses about their
treatment options. Such resources need to be updated, evaluated, and
disseminated to further impact improvements in women's health. OWH has
collaborated with Pharmacy Choice, Inc. to create a Web portal solely
dedicated to FDA consumer health education materials, providing access
to fact sheets and medication guides. In keeping with current
technology trends, OWH has used social media networks like Twitter to
reach out to consumers.
office of women's health and sex differences research
OWH funds high-quality scientific research to serve as the
foundation for FDA activities that improve women's health. Since 1994,
OWH has funded approximately 195 research projects with approximately
$15.7 million in intramural grants, supporting projects within the FDA
that address knowledge gaps or set new directions for sex and gender
research. All contracts and grants are awarded through a competitive
process and a large number are published in peer reviewed journals. It
is critical for the Congress to help preserve the vital functions of
OWH and to ensure that its budget is dedicated to the resource needs of
the office and to the projects, programs, and research it funds.
In conclusion, Mr. Chairman, we thank this subcommittee for its
strong record of support for the FDA and women's health. SWHR
recommends for fiscal year 2012 that you appropriate the $382 million
increase for the FDA provided in the administration's request so that
the FDA may dramatically improve upon current operations and to improve
its staffing and infrastructure needs. Second, we urge you to allocate
$7 million for OWH for fiscal year 2012, and to ensure that future
budget appropriations for the OWH never fall below fiscal year 2010
funding levels of $6 million.
We look forward to continuing to work with the subcommittee to
build a stronger, healthier, and safer future for all Americans.
______
Prepared Statement of The Humane Society of the United States
As the largest animal protection organization in the country, we
appreciate the opportunity to provide testimony to your subcommittee on
fiscal year 2012 items of great importance to The Humane Society of the
United States (HSUS) and its 11 million supporters nationwide. In this
testimony, we request the following assistance for the following U.S.
Department of Agriculture (USDA) accounts:
--Food Safety and Inspection Service (FSIS)/Humane Methods of
Slaughter Act (HMSA) Enforcement.--Language directing FSIS to
ensure that 23 inspectors hired through $2 million appropriated
in fiscal year 2009 for improved humane handling focus their
attention on overseeing compliance with humane handling rules
for live animals as they arrive and are offloaded and handled
in pens, chutes, and stunning areas.
--FSIS/Horse Slaughter.--Language mirroring fiscal year 2010
provision.
--Animal and Plant Health Inspection Service (APHIS)/Horse Protection
Act Enforcement.--$900,000.
--APHIS/Animal Welfare Act Enforcement.--$28,587,000.
--APHIS/Investigative and Enforcement Services.--$17,275,000.
--Office of Inspector General (OIG)/Including Animal Fighting
Enforcement.--$90,700,000.
--National Institute of Food and Agriculture (Formerly Cooperative
State Research, Education, and Extension Service)/Veterinary
Student Loan Forgiveness.--$4,800,000.
--APHIS/Emergency Management Systems/Disaster Planning for Animals.--
$1,017,000.
--APHIS/Wildlife Services.--Funding limitation on use of two
particularly toxic poisons.
--National Agriculture Library/Animal Welfare Information Center.--
$1,978,400.
At this time of intense budget pressure, we thank you for your
outstanding past support for enforcement of key animal welfare laws by
the USDA and we urge you to sustain this effort in fiscal year 2012.
While we understand the focus on reducing Federal spending, we believe
there should be room for careful decisionmaking within the budget to
achieve macro-level cuts and at the same time ensure adequate funding
for specific accounts that are vital and have previously been
underfunded.
Your leadership is making a great difference in helping to protect
the welfare of millions of animals across the country. As you know,
better enforcement also benefits people by decreasing:
--food safety risks to consumers from sick animals who can transmit
illness, and injuries to slaughterhouse workers from suffering
animals;
--orchestrated dogfights and cockfights that often involve illegal
gambling, drug trafficking, and human violence, and can
contribute to the spread of costly illnesses such as bird flu;
--sale of unhealthy pets by commercial breeders, commonly referred to
as ``puppy mills'';
--laboratory conditions that may impair the scientific integrity of
animal-based research;
--risks of disease transmission from, and dangerous encounters with,
wild animals in public exhibition; and
--injuries and deaths of pets on commercial airline flights due to
mishandling and exposure to adverse environmental conditions.
In order to continue the important work made possible by the
subcommittee's prior support, we request the following for fiscal year
2012.
food safety and inspection service/humane methods of slaughter act
enforcement
We request language to ensure strengthened HMSA enforcement. We
greatly appreciated the subcommittee's inclusion of $2 million in
fiscal year 2009 to address severe shortfalls in USDA oversight of
humane handling rules for animals at slaughter facilities, oversight
that is important not only for animal welfare but also for food safety.
Effective day-to-day enforcement can prevent abuses like those that
have previously been documented in undercover investigations, and
associated food safety risks and costly recalls of meat and egg
products. While the agency has begun to take steps to strengthen its
HMSA enforcement, it is imperative that these funds be used in the most
effective way possible. We understand that nearly all of the $2 million
was used to hire 23 new inspectors whose responsibilities are not
focused on humane handling. We, therefore, urge inclusion of language
directing FSIS to ensure that these 23 inspectors focus their attention
on overseeing compliance with humane handling rules of live animals as
they arrive and are offloaded and handled in pens, chutes, and stunning
areas.
horse slaughter
We request inclusion of the same language barring USDA from the
expenditure of funds for horse slaughter inspection as the subcommittee
included in the fiscal year 2010 omnibus. This provision is vital to
prevent renewed horse slaughter activity in this country.
animal and plant health inspection service/horse protection act
enforcement
We request that you support the President's request of $900,000 for
strengthened enforcement of the Horse Protection Act (HPA). The
Congress enacted the HPA in 1970 to make illegal the abusive practice
of ``soring,'' in which unscrupulous trainers use a variety of methods
to inflict pain on sensitive areas of Tennessee Walking Horses' hooves
and legs to exaggerate their high-stepping gait and gain unfair
competitive advantage at horse shows. For example, caustic chemicals--
such as mustard oil, diesel fuel, and kerosene--are painted on the
lower front legs of a horse, then the legs are wrapped for days in
plastic wrap and tight bandages to ``cook'' the chemicals deep into the
horse's flesh, and then heavy chains are attached to slide up and down
the horse's sore legs. Additional tactics include inserting foreign
objects such as metal screws or acrylic between a heavy stacked shoe
and the horse's hoof; pressure shoeing--cutting a horse's hoof down to
the sensitive live tissue to cause extreme pain every time the horse
bears weight on the hoof; and applying painful chemicals such as
salicylic acid to slough off scarred tissue, in an attempt to disguise
the sored areas. Though soring has been illegal for 40 years, this
cruel practice continues unabated by the well-intentioned but seriously
understaffed APHIS inspection program and the inherent conflicts of
interest in the industry self-policing system established to supplement
Federal enforcement. A report released in October 2010 by USDA's OIG
documents these problems and calls for increased funding to enable the
agency to more adequately oversee the law. Several horse show industry
groups, animal protection groups, and the key organization of equine
veterinarians have also called for funding increases to enable USDA to
do a better job enforcing this law. To meet the goal of the HPA, Animal
Care (AC) inspectors must be present at more shows. Exhibitors who sore
their horses go to great lengths to avoid detection, even fleeing a
show when USDA inspectors arrive. With current funding, AC is able to
attend only about 6 percent of the more than 500 Tennessee Walking
Horse shows held annually. An appropriation at the requested level will
help provide for additional inspectors, training, security (to address
threats of violence against inspectors), and advanced detection
equipment (thermography and gas chromatography/mass spectrometry
machines).
animal and plant health inspection service/animal welfare act
enforcement
We request that you support the President's request of $28,587,000
for Animal Welfare Act (AWA) enforcement under APHIS. We commend the
subcommittee for responding in recent years to the urgent need for
increased funding for the AC division to improve its inspections of
approximately 12,000 sites, including commercial breeding facilities,
laboratories, zoos, circuses, and airlines, to ensure compliance with
AWA standards. In May 2010, USDA's OIG released a report criticizing
the agency's history of lax oversight of dog dealers--finding that
inhumane treatment and horrible conditions often failed to be properly
documented and yielded little to no enforcement actions--prompting
Agriculture Secretary Vilsack to call for more inspections and a
tougher stance on repeat offenders. USDA is also moving forward on
regulations to implement a new responsibility created by the Congress
in 2008--enforcing a ban on imports from foreign puppy mills where
puppies are mass produced under inhumane conditions and forced to
endure harsh long-distance transport. AC currently has 130 inspectors
(with nine vacancies), compared to 64 inspectors at the end of the
1990s. An appropriation at the requested level would allow the agency
to continue to address the concerns identified by the OIG, enforce the
new puppy import ban, and provide adequate oversight of the many
licensed/registered facilities.
animal and plant health inspection service/investigative and
enforcement services
We request that you support the President's request of $17,275,000
for APHIS-Investigative and Enforcement Services. We appreciate the
subcommittee's consistent support for this division, which handles many
important responsibilities, including the investigation of alleged
violations of Federal animal welfare laws and the initiation of
appropriate enforcement actions. The volume of animal welfare cases is
rising significantly, and an appropriation at the requested level would
enable the agency to keep pace with the additional enforcement
workload.
office of inspector general/animal fighting enforcement
We request that you support the President's request of $90,700,000
for OIG to maintain staff, improve effectiveness, and allow
investigations in various areas, including enforcement of animal
fighting laws. We appreciate the subcommittee's inclusion of funding
and language in recent years for USDA's OIG to focus on animal fighting
cases. The Congress first prohibited most interstate and foreign
commerce of animals for fighting in 1976, tightened loopholes in the
law in 2002, established felony penalties in 2007, and further
strengthened the law as part of the 2008 farm bill. We are pleased that
USDA is taking seriously its responsibility to enforce this law,
working with State and local agencies to complement their efforts and
address these barbaric practices, in which animals are drugged to
heighten their aggression and forced to keep fighting even after
they've suffered grievous injuries. Dogs bred and trained to fight
endanger public safety, and some dogfighters steal pets to use as bait
for training their dogs. Cockfighting was linked to an outbreak of
exotic Newcastle disease in 2002-2003 that cost taxpayers more than
$200 million to contain. It's also been linked to the death of a number
of people in Asia reportedly exposed through cockfighting activity to
bird flu. Given the potential for further costly disease transmission,
as well as the animal cruelty involved, we believe it is a sound
investment for the Federal Government to increase its efforts to combat
illegal animal fighting activity. We also support the OIG's auditing
and investigative work to improve compliance with AWA, HPA, HMSA, and
downed animal rules.
national institute of food and agriculture/veterinary student loan
forgiveness
We request that you support the President's request of $4.8 million
to continue the implementation of the National Veterinary Medical
Service Act (Public Law 108-161). This program received $2.95 million
in fiscal year 2009, $4.8 million in fiscal year 2010, and was
projected to need $5 million in its third year under the Congressional
Budget Office score accompanying authorization. We appreciate that the
Congress is working to address the critical shortage of veterinarians
practicing in rural and inner-city areas, as well as in Government
positions at FSIS and APHIS. A 2009 Government Accountability Office
report enumerating the challenges facing veterinary medicine identified
that an inadequate number of veterinarians to meet national needs is
among the foremost challenges. A 2006 study demonstrated the acute and
worsening shortage of veterinarians working in rural farm animal
practice, while domestic pets in both rural and urban areas are often
left without necessary medical care. Having adequate veterinary care is
a core animal welfare concern. To ensure adequate oversight of humane
handling and food safety rules, FSIS must be able to fill vacancies in
inspector positions. Veterinarians also support our Nation's defense
against bioterrorism (the Centers for Disease Control estimate that 75
percent of potential bioterrorism agents are zoonotic--transmitted from
animals to human). They are also on the front lines addressing public
health problems such as those associated with pet overpopulation,
parasites, rabies, chronic wasting disease, and bovine spongiform
encephalopathy (``mad cow'' disease). Veterinary school graduates face
a crushing debt burden of $134,000 on average, with an average starting
salary of $68,000. For those who choose employment in underserved rural
or inner-city areas or public health practice, the National Veterinary
Medical Service Act authorizes the Secretary of Agriculture to forgive
student debt. It also authorizes financial assistance for those who
provide services during Federal emergency situations such as disease
outbreaks.
animal and plant health inspection service/emergency management
systems/disaster planning for animals
We request that you support the President's request of $1,017,000
for AC under APHIS' Emergency Management Systems line item. Hurricanes
Katrina and Rita demonstrated that many people refuse to evacuate if
they are forced to leave their pets behind. The AC division develops
infrastructure to help prepare for and respond to animal issues in a
disaster and incorporate lessons learned from previous disasters. These
funds are used for staff time and resources to support State and local
governments' and humane organizations' efforts to plan for protection
of people with animals, and to enable the agency to participate, in
partnership with the Federal Emergency Management Agency, in the
National Response Plan without jeopardizing other AC programs.
animal and plant health inspection service/wildlife services
We also hope the subcommittee will consider a funding limitation on
two particularly cruel, indiscriminate wildlife control methods used by
the Wildlife Services (WS) division to kill more than 13,000 animals
every year: the toxicants sodium cyanide (delivered via small explosive
devices known as M-44s) and sodium fluoroacetate (commonly known as
compound 1080). Not only are these two substances undeniably cruel to
animals, they also pose an unnecessary threat to human health and
public safety. The Federal Bureau of Investigation (FBI) has declared
that both compound 1080 and sodium cyanide are ``highly toxic
pesticides judged most likely to be used by terrorists or for malicious
intent.'' The FBI and the Canadian Security Intelligence Service have
listed compound 1080 as a substance that may be sought for use as a
possible chemical warfare agent in public water supplies. As early as
1999, the Air Force identified compound 1080 as a likely biological
agent. A funding limitation on the use of these particular methods
would not only reduce the number of animals killed every year and the
amount of suffering animals endure as a result of the continued use of
these inhumane methods by WS, it would help protect homeland security
and move WS toward nonlethal wildlife control methods that are safer,
more effective, less expensive, and more humane. With the most
indefensible methods eliminated, WS can focus on its other, more
beneficial programs.
animal welfare information center
We request $1,978,400 for the Animal Welfare Information Center
(AWIC). These funds will enable AWIC to improve its services as a
clearinghouse, training center, and educational resource to help
institutions using animals in research, testing, and teaching comply
with the requirements of AWA, including consideration of alternatives
to minimize or eliminate animal use in specific research protocols.
closing
Again, we appreciate the opportunity to share our views and
priorities for the Agriculture, Rural Development, Food and Drug
Administration, and Related Agencies Appropriation Act of fiscal year
2012. We are so grateful for the subcommittee's past support, and hope
you will be able to accommodate these modest requests to address some
very pressing problems affecting millions of animals in the United
States. Thank you for your consideration.
______
Prepared Statement of The Humane Society of the United States--Equine
Protection
On behalf of the undersigned animal welfare and horse industry
organizations (HIOs), with combined supporters exceeding 12 million,
and former Senator Joseph Tydings, we submit the following testimony
seeking an increase in funding for the U.S. Department of Agriculture
(USDA)/Animal and Plant Health Inspection Service (APHIS) Horse
Protection Program to $900,000, as requested in the President's budget
for fiscal year 2012. We recognize that the Congress is focused on the
imperative of cutting Federal spending. But we believe that it should
be possible to achieve meaningful reductions in the overall budget
while still addressing shortfalls in very specific accounts that are
vital and have been seriously underfunded. This $900,000 is urgently
needed to begin to fulfill the intent of the Horse Protection Act
(HPA)--to eliminate the cruel practice of soring--by allowing the USDA
to strengthen its enforcement capabilities for this law.
In 1970, the Congress passed HPA to end soring, the intentional
infliction of pain to the hooves and legs of a horse to produce an
exaggerated gait, practiced primarily in the Tennessee Walking Horse
show industry.
For example, caustic chemicals--such as mustard oil, diesel fuel,
and kerosene--are painted on the lower front legs of a horse, then the
legs are wrapped for days in plastic wrap and bandages to ``cook'' the
chemicals deep into the horse's flesh. This makes the horse's legs
extremely painful and sensitive, and when ridden, the horse is fitted
with chains that slide up and down the horse's sore legs, forcing him
to produce an exaggerated, high-stepping gait in the show ring.
Additional tactics include inserting foreign objects such as metal
screws or hard acrylic between a heavy stacked shoe and the horse's
hoof; pressure shoeing--cutting a horse's hoof down to the sensitive
live tissue to cause extreme pain every time the horse bears weight on
the hoof; and applying painful chemicals such as salicylic acid to
slough off scarred tissue, in an attempt to remove evidence of soring.
HPA authorizes the USDA to inspect Tennessee Walking Horses and
Racking Horses--in transport to and at shows, exhibits, auctions, and
sales--for signs of soring, and to pursue penalties against violators.
Unfortunately, since its inception, enforcement of the act has been
plagued by underfunding. As a result, the USDA has never been able to
adequately enforce the act, allowing this extreme and deliberate
cruelty to persist on a widespread basis.
The most effective way to eliminate soring and meet the goals of
the act is for USDA officials to be present at more shows. However,
limited funds allow USDA attendance at only about 6 percent of
Tennessee Walking Horse shows. So the agency set up an industry-run
system of certified HIO inspection programs, which are charged with
inspecting horses for signs of soring at the majority of shows. These
groups license examiners known as designated qualified persons (DQPs)
to conduct inspections. To perform this function, some of these
organizations hire industry insiders who have an obvious stake in
preserving the status quo. Statistics clearly show that when USDA
inspectors are in attendance to oversee shows affiliated with these
organizations, the numbers of noted violations are many times higher
than at shows where industry inspectors alone are conducting the
inspections. By all measures, the overall DQP program as a whole has
been a failure--the only remedy is to abolish the conflicted industry-
run inspection programs charged with self-regulation and give USDA the
resources it needs to adequately enforce the act.
USDA appears to have attempted to step up its enforcement efforts
in recent years, as evidenced in 2009 by a more than twofold increase
over the previous year in the number of violations cited at the
industry's largest show (the Tennessee Walking Horse National
Celebration). However, horses identified at shows as having been sored
also continue to be shown in subsequent events, and their owners
continue to win lucrative prizes. USDA needs enhanced resources to
carry out its responsibilities as the Congress, and the public,
expects.
Lack of a consistent presence by USDA officials at events featuring
Tennessee Walking Horses, Racking Horses, Spotted Saddle Horses, and
other related breeds has fostered a cavalier attitude among industry
insiders, who have not stopped their abuse, but have only become more
clandestine in their soring methods. The continued use of soring to
gain an advantage in the show ring has tainted the gaited horse
industry as a whole, and creates an unfair advantage for those who are
willing to break the law in pursuit of victory. Besides the
indefensible suffering of the animals themselves, the continued
acceptance of sored horses in the show ring prevents those with sound
horses from competing fairly for prizes, breeding fees, and other
financial incentives, while those horse owners whose horses are sored
may unwittingly suffer property damage and be duped into believing that
their now abused, damaged horses are naturally superior.
Currently, when USDA inspectors arrive at shows affiliated with
some industry organizations, many of the exhibitors load up and leave
to avoid being caught with sored horses. While USDA could stop these
trailers on the way out, agency officials have stated that inspectors
are wary of going outside of their designated inspection area, for fear
of harassment and physical violence from exhibitors. Recently, armed
security has been utilized to allow such inspections, at additional
expense to this program. The fact that exhibitors feel they can
intimidate Government officials without penalty is a testament to the
inherent shortcomings of the current system.
In years past, inspections were limited to physical observation and
palpation by the inspector. New technologies, such as thermography and
``sniffer'' devices (gas chromatography/mass spectrometry machines),
have been developed, which can help inspectors identify soring more
effectively and objectively. However, USDA has been unable to purchase
and put enough of this equipment in use in the field, allowing for
industry insiders to continually evade detection. With increased
funding, the USDA could purchase this equipment and hire and train more
inspectors to use it properly, greatly increasing its ability to
enforce HPA.
The egregious cruelty of soring is not only a concern for animal
protection and HIOs, but also for veterinarians. In 2008, the American
Association of Equine Practitioners (AAEP) issued a white paper
condemning soring, calling it ``one of the most significant welfare
issues faced by the equine industry.'' It called for the abolition of
the DQP Program, saying ``the acknowledged conflicts of interest which
involve many of them cannot be reasonably resolved, and these
individuals should be excluded from the regulatory process.'' The AAEP
further stated, ``The failure of the HPA to eliminate the practice of
soring can be traced to the woefully inadequate annual budget of
$500,000 allocated to the USDA to enforce these rules and
regulations.''
The USDA Office of Inspector General recently conducted an audit of
the Horse Protection Program, and issued its final report in September
of 2010. The report recommends the abolition of the DQP program, and an
increase in funding for APHIS enforcement of HPA. The agency concurred
with the findings and recommendations in the report, specifically
recommendation 2: ``Seeking the necessary funding from Congress to
adequately oversee the Horse Protection Program'', indicating that it
requested a $400,000 increase in funding for fiscal year 2011 and that
it will develop a budgeting and staffing plan to phase in the resources
needed to adequately oversee the Horse Protection Program.
It is unacceptable that nearly 40 years after passage of HPA, the
USDA still lacks the resources needed to end this extreme form of
abuse. It is time for the Congress to give our public servants charged
with enforcing this act the support and resources they want and need to
fulfill their duty to protect these horses as effectively and safely as
possible.
We appreciate the opportunity to share our views about this serious
problem, and thank you for your consideration of our request.
Sincerely,
Keith Dane, Director of Equine Protection, The Humane Society of the
United States.
Former U.S. Senator Joseph Tydings, Original Sponsor of the Horse
Protection Act.
Lori Northrup, President, Friends of Sound Horses, Inc.
Chris Heyde, Deputy Director, Government and Legal Affairs, Animal
Welfare Institute.
Betsy Dribben, Vice President for Government Relations, American
Society for the Prevention of Cruelty to Animals (ASPCA).
Robin Lohnes, Executive Director, American Horse Protection
Association.
Shelley Sawhook, President, American Horse Defense Fund.
Louise Semancik, Plantation Walking Horses of Maryland.
Karen Brown, Director of Programs, United Animal Nations.
Karen Ayres, President, National Plantation Walking Horse Association.
Susan Crotty, President, Plantation Walking Horse Association of
California.
Joyce Guillemot, President, United Pleasure Walking Horse Association.
Gina Vehige, Gaitway Walking Horse Association.
Steve Bucher, President, Mid Atlantic Tennessee Walking Horse
Association.
Bonnie Yeager, President, International Pleasure Walking Horse
Registry.
Sharon Halpin, Sound Horse Outreach (SHO).
Penny Austin, President, One Horse At a Time, Inc. Horse Rescue.
Fran Cole, President, Northern California Walking Horse Association.
Bob Kuykendall, Tennessee Walking Horse Association of Oklahoma.
Cris Van Horn, President, Pure Pleasure Gaited Horse Association.
Rick Brighton, President, Northwest Gaited Horse Club.
Walter Farnholtz, President, New York State Plantation Walking Horse
Club.
Michele McGuire, Northwest Pleasure Tennessee Walking Horse
Association.
______
Prepared Statement of The Wildlife Society
The Wildlife Society (TWS) appreciates the opportunity to submit
testimony concerning fiscal year 2012 budgets for the Animal and Plant
Health Inspection Service (APHIS), National Institute of Food and
Agriculture (NIFA), and Natural Resources Conservation Service (NRCS).
TWS represents more than 10,000 professional wildlife biologists and
managers dedicated to sound wildlife stewardship through science and
education. TWS is committed to strengthening all Federal programs that
benefit wildlife and their habitats on agricultural and other private
land.
animal and plant health inspection service
Wildlife Services, a unit of APHIS, is responsible for controlling
wildlife damage to agriculture, aquaculture, forest, range, and other
natural resources, monitoring wildlife-borne diseases, and managing
wildlife at airports. Its activities are based on the principles of
wildlife management and integrated damage management, and are carried
out cooperatively with State fish and wildlife agencies. The
administration's request this year is a $10.36 million decrease from
fiscal year 2010. Such a significant decrease substantially reduces
funding for State and Federal cooperative wildlife damage programs
across the country; just a few of the programs affected would be Hawaii
Wildlife Operations, Mississippi Beaver Management, Montana, Idaho, and
Wyoming Predator Management, and Pennsylvania Cooperative Livestock
Protection. Funding cuts for these programs will result not only in
significant ecological damage, but threaten local economies as well.
TWS recommends the Congress increase the appropriation for Wildlife
Services operations to $77.78 million. This amount would continue to
provide support for ongoing programs funded through the direct
appropriations process, as well as fund necessary safety improvements
and cover the programmed pay costs for operations.
Another key budget line in Wildlife Service's operations is methods
development, which funds the National Wildlife Research Center (NWRC).
Much of the newest research critical to State wildlife agencies is
being performed at NWRC. In order for State wildlife management
programs to be the most up-to-date, the work of the NWRC must continue.
The President's request is currently a $10.36 million decrease from
fiscal year 2010 enacted levels. Ultimately, this decrease in funding
will eliminate or severely impact programs conducting research on
human-wildlife conflict (Jack Berryman Institute), invasive species and
seed crops (Hilo Hawaii Field Station), and wildlife disease
(Kingsville Texas Field Station). Such a loss could be devastating, as
human and wildlife issues are becoming increasingly intertwined. TWS
requests that the Congress restore $3.9 million to the methods
development line, including $1,243,892 to the methods development base;
$904,428 for the Hilo, Hawaii Field Station; $290,000 for the NWRC
Kingsville, Texas Field Station; and $1.5 million for the Logan, Utah
Berryman Institute.
Finally, TWS recommends providing $22.6 million to veterinary
services for addressing the import and export of invasive species. The
potential import of exotic disease and parasite vectors into the United
States is a grave threat to human, wildlife, and habitat health, and
has been shown to cause incalculable economic damage. To mitigate this
impact, it is essential that APHIS-Veterinary Services have the
capacity to conduct inspections at all U.S. ports. The historic method
of relying on import or user fees has proven to be inadequate at
preventing importation of previously unknown parasites and diseases.
Also, with the continuing spread of wildlife diseases worldwide,
growing number of exotic species importations, and increasing ports of
entry, the resources available to conduct inspections are stretched
even further.
national institute of food and agriculture
The Renewable Resources Extension Act (RREA) provides an expanded,
comprehensive extension program for forest and rangeland renewable
resources. RREA funds, which are apportioned to State Extension
Services, effectively leverage cooperative partnerships at an average
of 4 to 1, with a focus on private landowners. The need for RREA
educational programs is greater than ever because of continuing
fragmentation of ownership, urbanization, diversity of landowners
needing assistance, and increasing societal concerns about land use and
increasing human impacts on natural resources TWS recommends that RREA
be funded at $10 million.
The McIntire-Stennis Cooperative Forestry Program is essential to
the future of resource management on nonindustrial private forestlands
while conserving natural resources, including fish and wildlife. As
nationwide demand for forest products grow, privately held forests will
be increasingly needed to supplement supplies obtained from national
forest lands. However, commercial trees take many decades to produce.
In the absence of long research, such as that provided through
McIntire-Stennis, the Nation might not be able to meet future forest-
product needs as resources are harvested. We appreciate the more than
$29 million in funding allocated in the fiscal year 2010 appropriations
and urge that amount to be continued in fiscal year 2012.
natural resources conservation service
Food, Conservation, and Energy Act of 2008 (2008 farm bill)
conservation programs are more important than ever, given the huge
backlog of qualified applicants, increased pressure on farmland from
biofuels development, urban sprawl, and the concurrent declines in
wildlife habitat and water quality. NRCS, which administers many farm
bill conservation programs, is one of the primary Federal agencies
ensuring our public and private lands are made resilient to climate
change. NRCS does this through a variety of programs that are aimed at
conserving land, protecting water resources, and mitigating effects of
climate change.
One key program within the overall NRCS discretionary budget is
conservation operations. The total fiscal year 2012 request for
conservation operations is $899 million, an 11-percent decrease
compared to the fiscal year 2011 estimated level of $1.010 million.
Conservation operations' activities consists of five subactivities:
--technical assistance (TA);
--grazing lands;
--soil surveys;
--snow surveys; and
--plant materials.
TA subactivity provides funding for NRCS to support implementation
of the various farm bill programs. The fiscal year 2012 budget
recommends an increase of $10 million (1 percent) more than the fiscal
year 2011 estimated level for TA, and TWS supports this increase. We
also support the $11.3 million increase for NRCS' Conservation Delivery
Streamlining Initiative that promises to increase staff efficiencies
and allow more time for actual in-the-field conservation planning.
However, TWS believes more attention to TA delivery is needed.
Changes in the 2008 farm bill greatly increased the number of
conservation programs NRCS was required to support through delivery of
TA. In addition, the Congress expanded TA eligible activities in the
2008 farm bill to include conservation planning, education and
outreach, assistance with design and implementation of conservation
practices, and related TA services that accelerate conservation program
delivery. TA will require funding levels from Office of Management and
Budget (OMB) that are more than what was historically allocated if NRCS
is to fulfill congressional intent as intended in the 2008 farm bill.
Recently, the Congress allowed the use of mandatory funds for TA and,
under current economic conditions; TWS believes that such funds must
continue to be utilized for effective delivery to occur. TWS urges the
Congress to authorize up to 30 percent of each mandatory program's
funding for technical service provider provisions as mandated by the
2008 farm bill and additional technical assistance to provide resources
necessary to help meet NRCS TA shortfalls. Similarly, we strongly
encourage the Congress to explore new ways of funding technical
assistance in fiscal year 2012 and beyond. TWS also supports the $7
million requested for the Conservation Effects Assessment Project.
Information gathered from this effort will greatly assist in monitoring
accomplishments and identifying ways to further enhance effectiveness
of NRCS programs.
TWS recommends farm bill conservation programs be funded at levels
mandated in the 2008 farm bill. The administration's current budget
request will result in collective program reductions for the Wildlife
Habitat Incentive Program (WHIP), the Environmental Quality Incentives
Program (EQIP), and the Grassland Reserve Program (GRP) of $22 million
less than authorized levels. TWS encourages the Congress to restore
funding for all conservation programs at authorized levels. Demand for
these programs continues to grow during this difficult economic climate
at a time when greater assistance is needed to address natural resource
challenges and conservation goals, including climate change, soil
quality deficiencies, declining pollinator health, disease, and
invasive species, water quality and quantity issues, and degraded,
fragmented and lost habitat for fish and wildlife. We would also like
to specifically highlight WHIP, a voluntary program for landowners who
want to improve wildlife habitat on agricultural, nonindustrial, and
Indian land. WHIP plays an important role in protecting and restoring
America's environment, and is doubly important because it actively
engages public participation in conservation. We urge the Congress to
fully fund WHIP at $85 million.
farm services administration
The administration increased funding for the Conservation Reserve
Program (CRP) by $145 million versus fiscal year 2011 requested.
However, this increase assumes a CRP enrollment of 4 million acres in
spring of fiscal year 2011. TWS applauds Farm Services Administration
(FSA) efforts to have a 4-million-acre general sign-up in 2011, and to
more fully utilize CRP enrollment authority to address conservation
needs. Lands enrolled in CRP are important to conserve soil on some of
the Nation's most erodible cropland. These lands also contribute to
water quantity and quality, provide habitat for wildlife that reside on
agricultural landscapes, sequester carbon, and provide a strategic
forage reserve that can be tapped as a periodic compatible use in times
when other livestock forage is limited due to drought or other natural
disasters. It will be important for FSA to hold another general sign-up
in 2012 due to expiration of 6.6 million acres of CRP contracts on
September 30, 2012. A sign-up in advance of the date of expiration
would provide CRP contract holders the opportunity to compete for re-
enrollment and allow time for them to make management decisions
regarding their land. We strongly encourage the Congress to fund CRP at
a level that fully utilizes program enrollment authority through CRP
general sign-up. CRP initiatives including the Upland Bird Habitat
Initiative (CP33), Duck Nesting Habitat Restoration (CP37), the
Longleaf Pine Initiative (CP36), State Acres for Wildlife Enhancement
(SAFE), and Western States Shrub-steppe Conservation Initiative require
special incentives for enrollment. We are pleased with and support the
general sign-up and target enrollment of 4 million acres FSA included
in the fiscal year 2011 budget. CRP provides farmers with supplemental
income and helps them manage their farming operations. Enrolled lands
also provide an important source of fish and wildlife habitat and help
achieve soil and water conservation goals.
The Voluntary Public Access and Habitat Incentives Program was
first authorized in the 2008 farm bill. With an authorization of $50
million from fiscal year 2008-2012, the administration proposed funding
of the program for the first time at $16.67 million in fiscal year
2010. While this level of funding was enacted, none of the funds were
spent that year due to implementation delays. TWS commends the
administration for continuing to fund this program in fiscal year 2011
at the planned $33 million level. These funds will assist State and
tribal governments with needed resources to provide the public with
additional outdoor opportunities. In addition, increased public access
opportunities will help create jobs and stimulate rural economies.
Continuity of program funding is critical to these programs that rely
on landowner interest across multiple years. It is important that the
remaining $17 million in authorized program funding be provided in
fiscal year 2012 as the administration has requested.
Thank you for considering the views of wildlife professionals. We
look forward to working with you and your staff to ensure adequate
funding for wildlife conservation.
______
Letter From the USA Rice Federation
March 31, 2011.
Hon. Herb Kohl,
Chairman, Subcommittee on Agriculture, Rural Development, Food and Drug
Administration, and Related Agencies, Committee on
Appropriations, U.S. Senate, Washington, DC.
Hon. Roy Blunt,
Ranking Member, Subcommittee on Agriculture, Rural Development, Food
and Drug Administration, and Related Agencies, Committee on
Appropriations, U.S. Senate, Washington, DC.
Re: USA Rice Federation's Fiscal Year 2012 Agriculture Appropriations
Requests
Dear Chairman Kohl and Senator Blunt: This is to convey the rice
industry's requests for fiscal year 2012 funding for selected programs
under the jurisdiction of your subcommittee. The USA Rice Federation
appreciates your assistance in making this letter a part of the hearing
record.
The USA Rice Federation is the global advocate for all segments of
the U.S. rice industry with a mission to promote and protect the
interests of producers, millers, merchants, and allied businesses. USA
Rice members are active in all major rice-producing States: Arkansas,
California, Florida, Louisiana, Mississippi, Missouri, and Texas. The
USA Rice Producers' Group, the USA Rice Council, the USA Rice Millers'
Association, and the USA Rice Merchants' Association are members of the
USA Rice Federation. U.S. rice production supported 128,000 jobs and
more than $34 billion of economic output nationally in 2009.
USA Rice understands the budget constraints the subcommittee faces
when developing the fiscal year 2012 appropriations bill. We appreciate
your past support for initiatives that are critical to the rice
industry and look forward to working with you to meet the continued
needs of research, food aid, and market development in the future.
A healthy U.S. rice industry is also dependent on the program
benefits offered by the farm bill. Therefore, we oppose any attempts to
modify the farm-safety-net support levels provided by this vital
legislation through more restrictive payment limitations or other means
and encourage the subcommittee and Committee to resist such efforts
during the appropriations process, especially given that the 2008 farm
bill will be debated and reauthorized next year, is paid for, and
represents a 5-year contract with America's producers. USA Rice
strongly opposes reducing the farm-safety net to appropriate funds for
other Federal programs.
A list of the programs the USA Rice Federation supports for
appropriations in fiscal year 2012 are as follows.
market access
Exports are critical to the U.S. rice industry. About 50 percent of
the U.S. crop is exported annually in a highly competitive world-rice
market. Those directly involved in U.S. rice exports contributed $6
billion in output and supported more than 14,000 jobs. The Market
Access Program (MAP) and Foreign Market Development (FMD) Program play
key roles in helping to promote U.S. rice sales overseas. USA Rice
Federation industry members spend more than $3 in matching funds for
each $1 of Foreign Agricultural Service (FAS) funds received. The USA
Rice Federation uses MAP and FMD funding in more than 25 markets to
conduct successful export-market-development initiatives.
The FMD Program allows USA Rice to focus on importer, foodservice,
and other nonretail promotion activities around the world. This program
should be fully funded for fiscal year 2012 at the authorized level of
$34.5 million.
The MAP allows USA Rice to concentrate on consumer promotion and
other activities for market expansion around the world. This program
should also be fully funded for fiscal year 2012 at the authorized
level of $200 million.
In addition, the FAS should be funded to the fullest degree
possible to ensure adequate support for trade-policy initiatives and
oversight of export programs. These programs are critical for the
economic health of the U.S. rice industry.
food aid
We urge the subcommittee to fund Public Law 480 title I. No title I
funding has been provided since fiscal year 2006. At a minimum, fiscal
year 2012 funding should be the same as 2006. Public Law 480 title I is
our top food-aid priority and we support continued funding in order to
meet international demand. Food-aid sales historically account for an
important portion of U.S. rice exports.
For Public Law 480 title II, we strongly support funding title II
up front at the fully authorized $2.5 billion level, which would help
to make possible satisfying the 2.5 million MT amount required by
statute. We encourage the subcommittee to fund title II at the higher
level to ensure consistent tonnage amounts for the rice industry. We
strongly oppose any shifting of title II funds, which have
traditionally been contained within USDA's budget.
We believe all food-aid funds should continue to be used for food-
aid purchases of rice and other commodities from only U.S. origin.
USA Rice supports continued funding at fiscal year 2006 levels, at
a minimum, for the Food for Progress Program's Public Law 480 title I-
sourced funding. For the program's Commodity Credit Corporation funding
component, USDA's fiscal year 2012 budget estimate of $156 million is
requested. Funding for this program is important to improve food
security for food-deficit nations.
The McGovern-Dole International Food for Education and Child
Nutrition Program is a proven success and it is important to provide
steady, reliable funding for multi-year programming. USA Rice supports
funding at the $300 million level for this education initiative because
it efficiently delivers food to its targeted group, children, while
also encouraging education, a primary stepping-stone for populations to
improve economic conditions.
research
U.S. agricultural research needs are great and the challenges are
plentiful. USA Rice supports funding for the core capacity programs at
land-grant institutions, USDA's intramural-research activities, and the
National Institute of Food and Agriculture and its Agriculture and Food
Research Initiative at levels that would continue the commitment to
strong agricultural research by and through USDA.
farm service agency, risk management agency, and natural resources
conservation service
We encourage the subcommittee to provide adequate funding so the
agencies can deliver essential programs and services, including for
improved computer hardware and software. Our members fear a serious
reduction in service if sufficient funds are not allocated.
Please feel free to contact us if you would like further
information about the programs we have listed. Additional background
information is available for all of the programs we have referenced;
however, we understand the volume of requests the subcommittee receives
and have restricted our comments accordingly.
Thank you for your consideration of our recommendations.
Sincerely,
Reece Langley,
Vice President, Government Affairs.
LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS
----------
Page
American:
Commodity Distribution Association, Prepared Statement of the 113
Farm Bureau Federation, Prepared Statement of the............ 115
Indian Higher Education Consortium, Prepared Statement of the 118
Public Power Association, Prepared Statement of the.......... 121
Society of Plant Biologists, Prepared Statement of the....... 122
Animal Welfare Institute, Prepared Statement of the.............. 123
Blunt, Senator Roy, U.S. Senator From Missouri:
Prepared Statement of........................................ 18
Questions Submitted by....................................... 103
Statement of................................................. 70
Cochran, Norris, Deputy Assistant Secretary for Budget,
Department of Health and Human Services........................ 69
Collins, Senator Susan, U.S. Senator From Maine, Questions
Submitted by................................................... 58
Colorado River Basin Salinity Control Forum, Prepared Statement
of the......................................................... 126
Cystic Fibrosis Foundation, Prepared Statement of the............ 128
Federation of American Societies for Experimental Biology,
Prepared Statement of the...................................... 130
Feeding America, Prepared Statement of........................... 131
Feinstein, Senator Dianne, U.S. Senator From California,
Questions Submitted by.........................................50, 99
Friends of Agricultural Research--Beltsville, Inc., Prepared
Statement of................................................... 133
Glauber, Joseph, Chief Economist, Office of the Secretary,
Department of Agriculture......................................
Hamburg, Dr. Margaret A., Commissioner, Food and Drug
Administration, Department of Health and Human Services:
Prepared Statement of........................................ 73
Statement of................................................. 69
Summary Statement of......................................... 71
Harkin, Senator Tom, U.S. Senator From Iowa, Questions Submitted
by............................................................. 47
Izaak Walton League of America, Prepared Statement of the........ 135
Kohl, Senator Herb, U.S. Senator From Wisconsin:
Opening Statements of........................................ 1, 69
Questions Submitted by.......................................31, 92
McGarey, Patrick, Assistant Commissioner for Budget, Food and
Drug Administration, Department of Agriculture................. 69
Merrigan, Kathleen, Deputy Secretary, Office of the Secretary,
Department of Agriculture...................................... 1
Moran, Senator Jerry, U.S. Senator From Kansas, Questions
Submitted by................................................... 109
National:
Association:
Of:
County and City Health Officials, Prepared Statement
of the............................................. 137
State Energy Officials, Prepared Statement of the.... 138
Commodity Supplemental Food Program Association, Prepared
Statement of the........................................... 138
New Mexico Interstate Stream Commission, Prepared Statement of
the............................................................ 140
Pickle Packers International, Inc., Prepared Statement of........ 141
Pryor, Senator Mark, U.S. Senator From Arkansas, Questions
Submitted by................................................... 56
Society for Women's Health Research, Prepared Statement of the... 146
Strom, Hon. Leland A., Chairman and Chief Executive Officer, Farm
Credit Administration, Prepared Statement of................... 63
The:
Humane Society of the United States, Prepared Statement of... 149
Equine Protection, Prepared Statement of................. 152
Wildlife Society, Prepared Statement of...................... 154
USA Rice Federation, Letter From the............................. 157
Vilsack, Hon. Tom, Secretary, Office of the Secretary, Department
of Agriculture:
Prepared Statement of........................................ 3
Statement of................................................. 1
Summary Statement of......................................... 2
Young, Michael, Director, Office of Budget and Program Analysis,
Department of Agriculture...................................... 1
SUBJECT INDEX
----------
DEPARTMENT OF AGRICULTURE
Office of the Secretary
Page
Additional Committee Questions................................... 30
Agricultural:
Exports...................................................... 45
Production................................................... 22
Research..................................................... 23
Agriculture and Food Research Initiative (AFRI).................. 36
Antibiotics...................................................... 52
Assisting Rural Communities To Create Prosperity................. 3
Beginning Farmers................................................ 17
Broadband....................................................16, 21, 31
Budget Priorities................................................ 28
Catfish Inspection Program....................................... 25
China Food Safety System......................................... 58
Condition of the Farm Credit System.............................. 65
Crop:
Insurance.................................................... 29
Production................................................... 18
Dairy............................................................ 50
Insurance Program............................................ 50
Policy Reform Proposals...................................... 50
Discretionary Funding Levels..................................... 28
Energy Programs.................................................. 24
Ensuring That All of America's Children Have Access to Safe,
Nutritious, and Balanced Meals................................. 7
Examination Programs for Farm Credit System Banks and
Associations................................................... 64
Farm:
Bill Cuts.................................................... 45
Service Agency (FSA) Loan Programs........................... 25
Federal Agricultural Mortgage Corporation (Farmer Mac)........... 66
Food Safety and Inspection Service (FSIS)........................ 47
Funding Level................................................ 10
Foreign Market Development Programs.............................. 60
Forest Legacy.................................................... 60
Projects..................................................... 57
Formula Funds.................................................... 56
Genetically Modified Organisms (GMOs)............................ 35
Government:
Accountability Office (GAO) Report on Duplicative:...........
Government Programs...................................... 11
Programs................................................. 20
Spending Cuts................................................ 26
Grain Inspection, Packers and Stockyards Administration (GIPSA)
Rule...........................................................15, 58
Housing.......................................................... 38
Programs..................................................... 57
Humanitarian Food Assistance..................................... 45
Integrated Pest Management (IPM)................................. 59
Invasive Pests................................................... 51
Management Initiatives........................................... 9
Microenterprise Program.......................................... 44
Mission of the Farm Credit Administration (FCA).................. 63
Multifamily Revitalization Initiative............................ 40
National:
Drought Mitigation Center.................................... 22
Institute of Food and Agriculture (NIFA)..................... 27
Organic.......................................................... 53
Plant/Animal Health.............................................. 33
Promote Agricultural Production and Biotechnology Exports as
America Works To Increase Food Security........................ 7
Public Health Information System (PHIS).......................... 46
Regulatory and Corporate Activities.............................. 65
Renewable Energy.................................................31, 37
Rental Assistance................................................ 39
Research..................................................8, 35, 36, 57
Resource Conservation and Development (RC&D) Funding............. 58
School Food Safety............................................... 49
Section 502 and Mutual Self-Help Housing Program................. 56
Settlements of Discrimination Cases.............................. 36
The:
National Agricultural Law Center............................. 30
Special Supplemental Nutrition Program for Women, Infants,
and Children (WIC)......................................... 46
Trade Agreement.................................................. 19
Water and Waste Disposal Program................................. 37
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Food and Drug Administration
Additional Committee Questions................................... 91
Advancing:
Medical Countermeasures...................................... 76
Regulatory Science........................................... 96
Advisory Panels.................................................. 108
Antibiotics in Food Production.................................101, 109
Blood Testing.................................................... 108
Contract and Administrative Savings.............................. 75
Counterfeit Drugs................................................ 106
Diabetes and Obesity Drugs....................................... 109
Drug:
And Device Review Goals...................................... 84
Safety....................................................... 97
First and Second Generic Drugs................................... 90
Fiscal Year:
2010 Drug and Device Reviews................................. 84
2012 Budget Summary.......................................... 75
Food:
And Drug:
Administration (FDA):
Accomplishments...................................... 74
Current Law User Fees................................ 77
Innovation, Accountability, and Results.............. 73
Modernization........................................ 107
Regulatory Science and Facilities.................... 77
Supply................................................... 78
From the Farm................................................ 86
Marketing Guidelines......................................... 103
Safety:
Bill Implementation...................................... 101
Duplication Efforts...................................... 95
Modernization Act........................................81, 94
Traceability................................................. 82
Generic:
Drug:
Price Impacts............................................ 91
Review................................................... 104
User:
Fee.................................................. 91
Fees................................................. 90
Drugs........................................................89, 94
For Lipitor.................................................. 99
Livestock Antibiotics............................................ 86
Makena........................................................... 84
Medical:
Countermeasures (MCMs).......................................79, 92
Device Review................................................ 105
Nanotechnology................................................... 88
National Center for Toxicological Research (NCTR)................ 88
Nuclear Radiation and Its Effect on Our Food Supply.............. 100
Overall Budget................................................... 92
Patient Medication Information (PMI)............................. 97
Pregnancy Rule................................................... 93
Progress on Research Into Bisphenol-A (BPA)...................... 99
Protecting Patients.............................................. 76
Radiation:
Preparedness................................................. 79
Treatments................................................... 80
Responsibility Duplication....................................... 80
Review Process................................................... 82
Transforming Food Safety and Nutrition........................... 75
Unique Role of FDA............................................... 73
Use of Veterinary Drugs in Food-Producing Animals................ 103
User Fee Reviews................................................. 82
-