    [Senate Hearing 114-239]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 114-239

      IMPACT OF FEDERAL LABOR AND SAFETY LAWS ON THE U.S. SEAFOOD INDUSTRY

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

                                    HEARING

                                   BEFORE THE

                          COMMITTEE ON SMALL BUSINESS
                              AND ENTREPRENEURSHIP
                              UNITED STATES SENATE

                        ONE HUNDRED FOURTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                  MAY 6, 2015

                                   __________

        Printed for the Committee on Small Business and Entrepreneurship

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

             Available via the World Wide Web: http://www.fdsys.gov

                             _________

                U.S. GOVERNMENT PUBLISHING OFFICE
      99-457 PDF          WASHINGTON : 2016
    _________________________________________________________________________________
    For sale by the Superintendent of Documents, U.S. Government Publishing 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 20402-001

                COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP

                        ONE HUNDRED FOURTEENTH CONGRESS

                                  ----------
                       DAVID VITTER, Louisiana, Chairman
                 JEANNE SHAHEEN, New Hampshire, Ranking Member
    JAMES E. RISCH, Idaho                MARIA CANTWELL, Washington
    MARCO RUBIO, Florida                 BENJAMIN L. CARDIN, Maryland
    RAND PAUL, Kentucky                  HEIDI HEITKAMP, North Dakota
    TIM SCOTT, South Carolina            EDWARD J. MARKEY, Massachusetts
    DEB FISCHER, Nebraska                CORY A. BOOKER, New Jersey
    CORY GARDNER, Colorado               CHRISTOPHER A. COONS, Delaware
    JONI ERNST, Iowa                     MAZIE K. HIRONO, Hawaii
    KELLY AYOTTE, New Hampshire          GARY C. PETERS, Michigan
    MICHAEL B. ENZI, Wyoming
                      Zak Baig, Republican Staff Director
                     Ann Jacobs, Democratic Staff Director

                                C O N T E N T S

                                  ----------

                               Opening Statements

                                                                       Page

    Vitter, Hon. David, Chairman, and a U.S. Senator from Louisiana..     1
    Shaheen, Hon. Jeanne, Ranking Member, a U.S. Senator from New
      Hampshire......................................................     2

                                   Witnesses
                                    Panel 1

    Dr. Steven Solomon, Deputy Associate Commissioner for Regulatory
      Affairs, U.S. Food and Drug Administration.....................     8
    Ms. Portia Wu, Assistant Secretary of the Employment and Training
      Administration, U.S. Department of Labor.......................    26

                                    Panel 2

    Dr. Mike Strain, Commissioner, Louisiana Department of
      Agriculture and Forestry.......................................    43
    Mr. John P. Connelly, President, National Fisheries Institute....    51
    Mr. Frank Randol, President, Randol Inc..........................    60

              Alphabetical Listing and Appendix Material Submitted

    Connelly, John P.
        Testimony....................................................    51
        Prepared statement...........................................    53
    Highliner Foods
        Letter Dated May 5, 2015.....................................     4
    Randol, Frank
        Testimony....................................................    60
        Prepared statement...........................................    63
        Addendum 1...................................................    74
        Addendum 2...................................................    77
        Addendum 3...................................................    79
        Addendum 4...................................................    81
        Addendum 5...................................................    90
        Addendum 6...................................................   112
        Addendum 7...................................................   123
        Addendum 8...................................................   142
        Addendum 9...................................................   149
        Addendum 10..................................................   177
        Addendum 11..................................................   193
        Addendum 12..................................................   212
        Addendum 13..................................................   237
        Addendum 14..................................................   263
    Shaheen, Hon. Jeanne
        Opening statement............................................     2
        Prepared statement...........................................     6
        Letter Dated April 30, 2015..................................    72
    Solomon, Dr. Steven
        Testimony....................................................     8
        Prepared statement...........................................    11
        Responses to questions for the record........................   264
    Strain, Mike
        Testimony....................................................    43
        Prepared statement...........................................    47
    Vitter, Hon. David
        Opening statement............................................     1
    Wu, Portia
        Testimony....................................................    26
        Prepared statement...........................................    28
        Responses to questions for the record........................   269

      IMPACT OF FEDERAL LABOR AND SAFETY LAWS ON THE U.S. SEAFOOD INDUSTRY

                                  ----------

                             WEDNESDAY, MAY 6, 2015

                          United States Senate,
                            Committee on Small Business
                                          and Entrepreneurship,
                                                        Washington, DC.
        The Committee met, pursuant to notice, at 2:34 p.m., in
    Room SR-428A, Dirksen Senate Office Building, Hon. David
    Vitter, Chairman of the Committee, presiding.
        Present: Senators Vitter, Risch, Fischer, Ayotte, Shaheen,
    and Cantwell.

     OPENING STATEMENT OF HON. DAVID VITTER, CHAIRMAN, AND A U.S.
                         SENATOR FROM LOUISIANA

        Chairman Vitter. Good afternoon. We are going to start our
    hearing today on the Impact of Federal Labor and Safety Laws on
    the U.S. Seafood Industry. Thanks for joining us today.
        We are going to be hearing from two panels of expert
    witnesses and stakeholders, a Federal panel who I will
    introduce in a minute, and then a stakeholder panel. I want to
    thank all of our witnesses for being here today to testify on
    these important issues.
        As anyone who has visited Louisiana knows, we enjoy great
    quality seafood and that plays a major role in our culture and
    our economy, and this is true for other States in the United
    States and it is an important part of our economy. In
    Louisiana, that seafood industry supports 20,000 jobs in the
    State with an annual economic impact of over $1.7 billion.
        More regionally, the Gulf States produce 70 percent of the
    nation's oysters, 69 percent of domestic shrimp, and are a
    leading producer of domestic hard- and soft-shell blue crabs.
    More broadly, the seafood industry is responsible for creating
    jobs and revenue that supports so many families along the Gulf,
    in Alaska, and elsewhere, including the East Coast and the West
    Coast.
        Seafood processors in Louisiana and across the Gulf Coast
    rely on seasonal foreign workers to fill the most labor-
    intensive positions throughout the sector. These workers come
    to the United States legally under the H-2B visa program. This
    program is vital to many in the seafood business, as many of
    these operations take place in small rural communities where
    access to a stable, reliable labor force can be extremely
    difficult.
        Recently, we have seen the difficulty of compliance with
    this program increase, most notably the Department of Labor's
    decision to stop accepting private wage rate surveys, which has
    often forced businesses to reallocate their financial
    resources, and that has been a big, big cost increase for these
    businesses.
        Another area that requires attention is ensuring the safety
    of seafood that is being imported into the country. It is
    imperative that we ensure that foreign imports are playing by
    the same rules and regulations that our domestic producers
    operate under, and that is one of the reasons I introduced the
    Imported Seafood Safety Standards Act. This legislation
    increases inspection rates, quality standards, and penalties in
    order to protect American families.
        In closing, we need to make sure that Federal regulations
    of all types, like the two areas I have highlighted, do not
    unfairly and negatively impact our small domestic seafood
    providers. What Washington bureaucrats often fail to realize is
    that their rulemaking can literally put some small businesses,
    like domestic seafood producers, out of business. So, we need
    to focus on these and other regulatory areas.
        Again, I thank everyone for being here today and I look
    forward to our discussion.
        With that, I will turn it over to our Ranking Member,
    Senator Shaheen.

      OPENING STATEMENT OF HON. JEANNE SHAHEEN, RANKING MEMBER, A
                    U.S. SENATOR FROM NEW HAMPSHIRE

        Senator Shaheen. Thank you, Mr. Chairman, and thank you to
    all of our panelists this afternoon for being here.
        As the Chairman said, seafood is a big issue in my home
    State of New Hampshire just as it is in Louisiana. Even though
    we only have 18 miles of coastline, it is an industry that is
    important to the State, both because of our tourism industry
    and the fishing--the pleasure boat fishing that goes on off the
    coast of New Hampshire, but also because we have not only a
    small fishing industry, but we also have a fish processing
    industry in New Hampshire.
        And, Mr. Chairman, in the interest of brevity and because I
    have to leave early, I am going to submit my full statement for
    the record, but I just wanted to raise a couple of concerns.
        One is not directly related to this hearing, but since we
    are talking about seafood, I feel compelled to talk about the
    concerns that we have in New Hampshire and the Northeast
    relative to the fishing quotas that have been set by the
    Department of Commerce and specifically by NOAA. Over the past
    few years, the Federal Government has found that the declining
    levels of cod in the Gulf of Maine have been dramatic. There is
    some disagreement about that among scientists and among the
    fishing industry, but they have set very dramatic, very low
    quotas that have almost totally decimated the fishing industry
    in New Hampshire, and again, I appreciate that that is not the
    subject of today's hearing, but it is an issue that we are very
    concerned about and I think it is something that we need to
    deal with because of its impact on our small business fishing
    fleet in New Hampshire.
        The other issue that is relevant to today's discussion is
    one that is having an impact in New Hampshire, as well, and
    that is the impact of creating a separate Federal program to
    remove catfish inspection authority from the FDA. As some of
    you probably already know, the 2008 farm bill transferred the
    inspection of catfish alone from FDA to the Department of
    Agriculture and it left the FDA with the jurisdiction of all
    other seafood products. That means that all of our seafood
    processors that handle catfish will now be subject to two
    separate sets of regulations. This is a costly and unnecessary
    burden on these businesses. It will kill jobs and hurt economic
    development.
        And, in fact, just the prospect of this regulation has put
    a freeze on job creation in some of those companies in New
    Hampshire. One seafood company, High Liner Foods, which I have
    had the opportunity to tour, has put on hold the job expansion
    that they would like to do because of the uncertainty around
    these regulations, and Mr. Chairman, I would like to enter this
    letter from High Liner Foods for the record, if I can.
        [The letter follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Chairman Vitter. Without objection.
        Senator Shaheen. This duplicative regulation does not just
    affect the seafood industry and it is not really about food
    safety, I believe. I think it is an effort to set up trade
    barriers against foreign catfish that will dramatically affect
    not only the seafood processing business in New Hampshire and
    this country, but it also could put us open to challenge at the
    WTO and trade retaliation against other agricultural
    industries.
        So, Mr. Chairman, I have been working with other members of
    the Senate to try and repeal this duplicative program. I hope
    we can do that. I think it is unnecessary and I hope that we
    will have the opportunity to do that and to further discuss
    this, not just in this committee, but when we get to the floor
    of the Senate.
        So, thank you again to our panelists for being here and I
    look forward to the discussion today.
        [The prepared statement of Senator Shaheen follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Chairman Vitter. Thank you, Senator Shaheen.
        We will now go to our first panel of witnesses, our Federal
    panel. I will introduce both and then we will hear their
    testimony and have discussion following their testimony.
        Dr. Steven Solomon is Deputy Associate Commissioner for
    Regulatory Affairs at the FDA, and he was appointed to that in
    April 2014. Prior to his appointment, he served in several
    capacities at the FDA since 1990. Dr. Solomon holds a D.V.M.
    degree from Ohio State University and a Master's of Public
    Health from Johns Hopkins University. Prior to joining the FDA,
    he owned and operated a private veterinary practice.
        And, he will be followed by Ms. Portia Wu, Assistant
    Secretary of the Employment and Training Administration within
    the U.S. Department of Labor. She was appointed to that in
    April 2004 and she now leads that Employment and Training
    Administration with its mission to address our nation's
    workforce needs through high quality training and employment
    programs. Prior to that, she held a number of positions in
    public, nonprofit, and private sector situations, including
    serving at the White House on the Domestic Policy Council as
    Special Assistant to the President for Labor and Workforce
    Policy. Ms. Wu holds a Yale Law School degree and a degree from
    Yale College and a Master's degree from Cornell, and is
    originally from Albany, New York.
        Welcome to both of you, and we will start with Dr. Solomon.

        STATEMENT OF STEVEN M. SOLOMON, D.V.M., M.P.H., DEPUTY
     ASSOCIATE COMMISSIONER FOR REGULATORY AFFAIRS, FOOD AND DRUG
      ADMINISTRATION, U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES

        Dr. Solomon. Good afternoon, Chairman Vitter, Ranking
    Member Shaheen, and members of the committee. I am Dr. Steve
    Solomon, Deputy Associate Commissioner for Regulatory Affairs
    at the Food and Drug Administration, and I appreciate the
    opportunity to appear before you today to discuss the agency's
    ongoing efforts to oversee the safety of the U.S. seafood
    supply.
        FDA has a strong regulatory program in place to ensure the
    safety of both domestic and imported seafood. In fact, the
    Hazard Analysis and Risk Preventive Control framework of FDA's
    seafood safety program is a basis for the preventive controls
    requirements for other FDA regulated foods called for in the
    FDA Food Safety Modernization Act, or FSMA. The agency has a
    variety of tools to ensure compliance with seafood safety
    requirements, including inspections of both domestic and
    foreign processing facilities, a hundred percent electronic
    screening of all imported products, examination of sampling of
    domestic seafood and seafood offered for import in the United
    States, domestic surveillance sampling of imported products,
    inspection of seafood importers, and foreign country program
    assessments.
        In today's testimony, I want to discuss FDA's regulatory
    framework for overseeing the safety of the U.S. seafood supply,
    emphasizing the agency's risk-based efforts with regard to
    imported seafood.
        Processors of fish and fishery products are subject to
    FDA's Hazard Analysis Critical Control Point, or HACCP,
    regulation. In short, the regulation requires both domestic and
    foreign processors of fish and fishery products to understand
    the food safety hazards associated with their process and
    product and require a preventive system to control for those
    hazards. Every processor is required to have and implement a
    written HACCP plan whenever a hazard analysis reveals one or
    more food safety hazards that are reasonably likely to occur.
    Foreign processors who export seafood to the United States also
    have to have--apply to the HACCP regulation.
        In addition, HACCP regulations require importers to
    understand the hazards associated with the products they are
    importing and to take positive steps to verify that they obtain
    shipments from foreign processors who comply with these
    requirements.
        In recent years, there have been reports of seafood in the
    United States being labeled with incorrect market names. FDA is
    aware that there may be economic incentives for some seafood
    producers and retailers to misrepresent the identity of the
    seafood species that they sell to buyers and consumers. While
    seafood fraud is often an economic issue, we have heightened
    concerns when species substitution poses a public health risk.
        The agency has invested in significant scientific
    advancements to enhance its ability to identify seafood species
    using state-of-the-art DNA sequencing. FDA is actively working
    to transfer this technology, which will enable the seafood
    industry and others to monitor and test their products to
    confirm the species purchase is correct.
        Turning now to imports specifically, it is the importers'
    responsibility to offer for entry into the United States
    product that is fully compliant with all applicable U.S. laws.
    FDA has numerous tools and authorities that enable the agency
    to take appropriate action regarding imported product. In
    recent years, the agency has significantly increased its number
    of foreign food inspections. Furthermore, if FDA requests to
    inspect a foreign facility and is refused, FSMA gave the agency
    the authority to not allow that facility's food submission into
    the United States.
        Besides HACCP inspection of foreign facilities, the agency
    also conducts surveillance of food offered for import at the
    border to check for compliance with U.S. requirements. FDA
    reviews all import entries electronically prior to the product
    being allowed into the country. The agency has implemented an
    automated screening tool, the PREDICT system, which
    significantly improves FDA's screening of imported food.
    PREDICT utilizes the admissibility history of the firm and/or a
    specific product and incorporates the inherent risk associated
    with the product. For example, a PREDICT review includes the
    facility inspection history, data quality concerns, sample
    analytical findings, and type of product that the firm offers
    for entry into U.S. commerce.
        Based on this electronic screening, the agency will direct
    resources to the most critical entries that have the greatest
    impact on public health. A subset of the import entries flagged
    may be physically inspected and/or sampled at varying rates
    depending on the type of the seafood product and the risk
    factors described.
        Another key regulatory tool for controlling imported goods
    is the Import Alert. Import Alerts inform FDA field personnel
    that the agency has sufficient evidence or other information
    about a particular product, producer, shipper, or importer to
    believe that future shipments of an importer product may be
    violative. On the basis of that evidence, FDA field personnel
    may detain the article that is being offered for import in the
    United States without physically examining the product. The
    agency has over 45 active seafood Import Alerts that focus on
    imports from certain firms, products, and/or countries based
    upon past violations or public health concerns.
        An Import Alert shifts the burden to the importer to
    demonstrate that the product meets FDA regulatory requirements.
    For example, FDA imposed a country-wide Import Alert on five
    aquaculture species from China in June 2007 due to the presence
    of unapproved animal drugs. These entries are currently subject
    to private laboratory testing before they are allowed into
    domestic commerce.
        Finally, I would like to note that the FDA is working
    globally to better accomplish its mission to promote and
    protect the public health of the United States. As one example,
    the agency has conducted foreign country assessments to
    evaluate the country's laws for and implementation of good
    aquaculture practices. FDA uses the information from country
    assessments to target better surveillance sampling of imported
    aquaculture products, informs its planning of foreign seafood
    HACCP inspections, provide additional evidence for potential
    regulatory actions, and improve collaboration with foreign
    government and industry to achieve better compliance with FDA's
    regulatory requirements.
        In closing, oversight of the safety of the U.S. food supply
    continues to be a top priority for FDA. The agency has a strong
    regulatory program in place for seafood products. We will
    continue to work with our domestic and international partners
    to ensure the safety of both domestic and imported seafood.
        Thank you again for the opportunity to appear before you
    today, and I would be happy to answer any questions.
        [The prepared statement of Dr. Solomon follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Chairman Vitter. Thank you very much, Doctor.
        Now, we will hear from Ms. Wu. Welcome.

    STATEMENT OF PORTIA WU, ASSISTANT SECRETARY FOR EMPLOYMENT AND
                   TRAINING, U.S. DEPARTMENT OF LABOR

        Ms. Wu. Thank you, Mr. Chairman. Chairman Vitter, Ranking
    Member Shaheen, members of the committee, thank you for having
    me here today to discuss the H-2B program and the seafood
    industry. My name is Portia Wu and I am the Assistant Secretary
    at the Employment and Training Administration at the Department
    of Labor. Together with the Department of Homeland Security, we
    administer the H-2B program.
        The H-2B program allows employers to meet legitimate needs
    for temporary foreign workers and the Department takes very
    seriously its statutory responsibility to administer this
    program and to ensure that U.S. workers have meaningful access
    to these job opportunities, that their wages and working
    conditions are not adversely affected. These efforts also help
    protect foreign-born workers from exploitation.
        The Department recognizes the vital role that the H-2B
    program plays for the seafood industry. Many seafood employers
    are multi-generational family-owned businesses and they are a
    source of cultural pride in coastal areas. The jobs these
    businesses provide are critical to local communities and create
    additional jobs in other related industries.
        And, Mr. Chairman, as you referenced, these businesses are
    often in remote or rural areas and so they can struggle to
    attract and retain a sufficient workforce necessary to provide
    seafood products for the United States and for the world. Thus,
    many do depend on temporary workers, including temporary
    foreign workers.
        Over the last five years, employers in some of the largest
    seafood producing States, like Louisiana and Maryland, were
    among the top ten users of the H-2B program, and last year,
    approximately 55 percent of the seafood jobs certified by the
    Department of Labor were located in the Gulf Coast States,
    ranging from shrimp boat deckhands in Texas to seafood and
    crawfish processors and packagers in Louisiana.
        We understand that seafood employers and others are
    impacted by the current annual 66,000 number cap on H-2B
    workers. That cap is set by Congress. And, we are again seeing
    demand nationwide that exceeds that cap.
        The Department is committed to maintaining a fair and
    reliable application process for those who use the program.
    However, unfortunately, in recent years, we have faced
    difficulties in achieving stability in this program because the
    Department of Labor's H-2B regulations have been subject to
    numerous cases brought in court by both employers and worker
    advocates. In fact, this litigation ultimately resulted in
    temporarily suspending the processing of H-2B applications
    earlier this year.
        Last week, in order to quickly reinstate the H-2B program
    and also to bring certainty, stability, and continuity to that
    program, the Department of Labor and the Department of Homeland
    Security jointly issued two new regulations. One is an interim
    final rule establishing the overall framework for the H-2B
    program. I should note that is an interim final rule, so it is
    open for public comment until June 29. The other is a final
    updated wage rule that allows the use of private wage surveys
    in certain circumstances in keeping with a recent court
    decision.
        These rules immediately restore processes for approving
    prevailing wage requests and labor certification applications
    so the program can continue to operate. They expand employer
    requirements for recruitment and consideration of U.S. workers
    so United States workers have a fair shot at finding and
    applying for these jobs. It also permits employers in the
    seafood industry to continue to stagger the entry of their H-2B
    workers into the United States.
        The regulations strengthen worker protections by clarifying
    employer obligations with respect to wages, working conditions,
    and benefits that must be offered to H-2B and U.S. workers
    alike.
        And, finally, as I noted, the rules explicitly include the
    use of private wage surveys, which were restricted by a recent
    court decision, and they--so, we set guidelines for how these
    surveys can now be used, and that includes State surveys, which
    are often used in the seafood industry.
        Both the Department of Labor and DHS are trying to ensure a
    smooth transition between the former regulations and the new
    rules. First and foremost, anyone who had already applied under
    the old rules or who were in line does not have to change
    anything. They will continue to operate under the prior
    regulations.
        Second, the new regulations allow an expedited process for
    employers who have a start date of need before October 1, 2015,
    so people will have time to quickly transition.
        In conclusion, the Department of Labor strives to maintain
    an H-2B program that is both responsive to legitimate employer
    needs where qualified U.S. workers are not available and to
    provide adequate protections for U.S. and foreign temporary
    workers. Doing so is not only good for law-abiding employers,
    including employers in the seafood industry, but also for the
    many U.S. workers seeking jobs in fields that rely heavily on
    the H-2B program.
        Thank you again for this opportunity and I look forward to
    answering your questions.
        [The prepared statement of Ms. Wu follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Chairman Vitter. Okay. Thank you, Ms. Wu, and we will start
    with our questions, and let me begin with you on one of the
    topics you discussed directly, and that is private wage
    surveys.
        Is it not correct that the new rule you were describing
    greatly limits compared to past practice, greatly narrows and
    limits the use of private wage surveys?
        Ms. Wu. Senator, it is true that in December last year, we
    had--our previous rule allowed significant use of private wage
    surveys. That use was enjoined by a court in December of last
    year and the court's opinion lays out a great deal of
    reasoning, including concerns about how private wage surveys
    might undercut wages and some other reasons that, for example,
    surveys that use only entry-level wages are not permissible
    under the law. They found that to be a violation of the law.
        At that time, we had to immediately suspend the use of
    surveys because of the court's order. However, with our new
    rule, we allow surveys in limited circumstances. There are
    some, and again, it is in keeping with the court's order, we
    believe, where, for example, an occupation is not well
    represented in the Occupational Employment Statistics.
        We also specifically allow for State conducted surveys, and
    I know this is a subject of particular interest in the seafood
    industry because many States do this. There are some basic
    criteria in keeping with the court's order. For example, as I
    mentioned, you have to look at average wages in an industry,
    not simply entry-level wages. But, we believe that this may be
    an opportunity for many in the seafood industry to take
    advantage of this provision. We actually--I was talking with
    some of your folks from Louisiana today and we are putting out
    some assistance next week to explain to people how they can use
    these surveys.
        In the transition provisions, we also said that, for
    example, if you already got your certification but you have not
    brought your workers in and you are wondering, can I go back
    and get a new survey wage, as long as it complies with our
    basic criteria, we put in a provision to allow people to go
    back and adjust that wage.
        Chairman Vitter. Well, Ms. Wu, as you know, there is a lot
    of concern that the new system is too narrow and narrows the
    use of these surveys way beyond anything that would be
    absolutely required or demanded by the court. What is your
    reaction to that critique, which I think is a fair one?
        Ms. Wu. Thank you, Senator. I think we believe that the new
    provisions are in keeping with the court's order. I should
    note, the State-provided surveys, frankly, we may be getting
    some criticism from the other side that it may be going beyond
    what the court allowed. So, there are many points of view on
    it.
        But, I do think that this provision of State-provided
    surveys may be an avenue that industries, particularly the
    seafood industry, could take advantage of and have taken
    advantage of in the past.
        Chairman Vitter. Does use of these State surveys allow for
    recognizing differences which exist from one local area to
    others within the State?
        Ms. Wu. Yes, Senator, it could. Obviously, it is up to the
    State as to what level of detail is conducted in the surveys.
    They certainly could provide a survey where there are
    differences in locality. Obviously, with different sorts of
    tasks in the industry, they would have different levels of
    wages. And, the Department is not in the business of dictating
    how employers should pay their wage or not. I know some
    employers, for example, use piece rate. They will be able to
    continue doing so.
        Chairman Vitter. Okay. And, Dr. Solomon, my understanding
    is that in 2014, only about 2.77 percent of all seafood imports
    were inspected. Do you think that percentage is adequate, and
    if not, what does the FDA plan to do differently?
        Dr. Solomon. So, the seafood safety system that I described
    during my testimony is multi-faceted, so there are many
    components of it. First, it is putting the Hazard Analysis
    Critical Control Point regulations into place, which puts the
    burden on the processor to produce safe product. Then, we have
    oversight by doing foreign inspections of them. Then, we also
    conduct inspections of HACCP regulations by the importers.
        So, the testing that takes place at the border is a
    verification activity or a surveillance activity to try and
    find if there is any flaws in the system and how it is working
    and to identify them and it is verification activities.
        So, we test at different rates a sampling. So, taking
    generic rates for seafood, we test higher rates for certain
    products, certain commodities, higher risk areas in much higher
    rates than that because we want to have additional verification
    for those particular aspects which pose the greatest safety
    concerns.
        Chairman Vitter. I understand all of that. I did not mean
    to suggest by my question that you just do one thing, you just
    stop 2.77 percent at the border and test it. So, as part of
    that overall effort, do you think the net inspection rate of
    2.77 percent is adequate?
        Dr. Solomon. Examination at the border as a verification
    activity at the various rates we do, we think is a viable
    control measure in light of all the other measures that we have
    in place.
        Chairman Vitter. So, you have no plans to increase it?
        Dr. Solomon. With the resources we currently have, we would
    not just increase sampling testing. If the agency had
    additional resources, we would focus on all the aspects of the
    framework, the regulatory structure that I described.
        Chairman Vitter. Why would you increase it if you had more
    resources?
        Dr. Solomon. Greater oversight and greater confidence in
    how the system is working. We would do more foreign
    inspections. We would do more importer examinations. But, once
    again, not on a universal basis, on a risk basis, on the
    products----
        Chairman Vitter. So, the level you do now is not optimal?
        Dr. Solomon. Uh, we think we actually have very few
    foodborne illnesses associated with seafood products, but with
    more resources, the agency could do more.
        Chairman Vitter. Okay. I am just trying to understand. You
    are suggesting it is adequate, but in the next sentence, you
    said you would certainly do more with more money.
        Dr. Solomon. So, it is a risk basis in terms of looking at
    the products that are coming in. With additional resources, we
    could look at lower levels of risk. We are looking at the
    highest levels of risk now.
        Chairman Vitter. Doctor, certainly in the past, the
    following has happened. A batch of actually tested and rejected
    seafood imports has been simply shopped to another port of
    entry. What in your overall system today categorically prevents
    that?
        Dr. Solomon. So, we have a notification system, electronic
    notification system. When we refuse an entry, that electronic
    notification system not only notifies Customs and Border
    Protection, but all the other FDA district offices and ports.
        Chairman Vitter. And, so, how is that batch tagged
    indelibly so that that notification is meaningful so that those
    other ports can identify the same batch we are talking about?
        Dr. Solomon. So, as you may be aware, we have been working
    for many years to try and get a marking rule that would provide
    that marking of the product. That is not in place yet, but
    right now, we do notifications based off the data that we have
    of who the importer is, what the commodity line is, and make
    sure that everyone is aware about that shipment was refused.
        Chairman Vitter. So, if they--so, there is not a set
    marking rule, so if they change the packaging or any of the
    markings, they could very possibly get away with what I am
    describing?
        Dr. Solomon. The system is not foolproof, I agree with you,
    but we do do notifications.
        Chairman Vitter. Okay. Well, I mean, I would suggest that
    is a bigger hole than simply saying it is not absolutely
    foolproof, but we will pursue that.
        Senator Shaheen.
        Senator Shaheen. Thank you, Mr. Chairman.
        Dr. Solomon, as I said in my opening statement, I am very
    concerned that we are in the process of setting up a new
    program under the Department of Agriculture to separate catfish
    out from all other seafood and inspect them separately. I think
    it is duplicative and it does not make sense.
        So, I wonder if you could talk a little bit about the
    program that has been operating under FDA, which up until now
    has had the responsibility for inspecting catfish. Can you tell
    us how it has functioned and whether or not catfish consumption
    has posed a risk to human health. Is there a reason why we
    should be setting up a separate program?
        Dr. Solomon. So, the last part of the question, catfish is
    not one of the species that we particularly target as being a
    risky product. It is not a product that is typically eaten or
    consumed raw. It is cooked beforehand. It is not put into
    reduced oxygen packaging, some of the other risk factors that
    may be associated with it. So, we handle catfish under the same
    framework that I described before. We have both inspections,
    domestic inspections, foreign inspections, the HACCP controls
    in place that have been adequately controlling issues
    associated with catfish.
        Senator Shaheen. So, and just to be clear, it is not the
    FDA or the Department of Labor or USDA that has set up this
    program separately. It was Congress that did this in the farm
    bill. But, there was not a safety risk to human health from
    catfish that triggered this effort, is that how you would
    analyze the situation?
        Dr. Solomon. I am not aware of any specific safety hazards
    unique to catfish.
        Senator Shaheen. Thank you. And, I know it may be hard for
    you to put a cost figure on the inspection of catfish under the
    FDA jurisdiction, that it may take you some time to come up
    with that. It is my understanding that right now, the USDA's
    catfish inspection program, it is estimated that it will cost
    about $14 million a year to operate. So, I am going to ask you
    to take for the record and try and get for this committee the
    cost of the inspection of catfish under FDA jurisdiction, if
    you would.
        Dr. Solomon. We would be happy to provide that back to you.
        Senator Shaheen. Okay. Thank you.
        Ms. Wu, I appreciate the fact that the Department is in a
    challenging position relative to how to make the H-2B visa
    program work, given that we have not yet taken up comprehensive
    immigration reform, which would go a long way towards
    addressing this challenge. But, in the meantime we do have
    small businesses in my State, we heard from the Chairman in
    Louisiana, who are using the H-2B program and are confused
    about how the new rules will affect their business. So, can you
    talk a little bit about how you are addressing outreach to
    those small businesses that are affected.
        Ms. Wu. Absolutely, Senator. As I noted, we have a bunch of
    fact sheets on our Web site. We are also doing some sort of
    webinars and outreach next week to talk with people. We
    always--we have frequent listening sessions. We recognize the
    use of this program by small business. We are happy to answer
    any questions.
        We have very detailed questions about, you know, if I
    already submitted my application, what happens to me now. And,
    I think, as I noted, for people who had already submitted their
    application before this whole court case in April, they can
    just keep going along. They got approved. They can keep going
    along, running the program the way they were going to do it
    this summer. There will be changes in the future.
        For those who want workers before October 1, we put in a
    sort of expedited process. As you may know, DHS administers the
    cap, but the cap was hit fairly early this year. But, we
    continue to process requests for labor certification, because
    there are some exceptions. So, we are happy to answer any
    questions. We are doing outreach to small businesses.
        Senator Shaheen. And, so, when you advertise those webinars
    that you are doing, do you notify the Small Business
    Administration so they can get it out to the Small Business
    Development Centers to share that with other businesses around
    the country? How do you get the word out that you are doing
    those kinds of webinars?
        Ms. Wu. Well, first and foremost, we use the contacts list
    that we have of the users of the program, because, obviously,
    the Small Business Administration deals with many, many
    businesses who do not even know what the H-2B program is.
        Senator Shaheen. Right.
        Ms. Wu. So, we really focus on the contacts that we have
    and work with our colleagues at DHS and others to make sure
    that we get the word out. But, if you have other suggestions or
    if you are concerned about the employers in your State, we
    would be happy to conduct some targeted outreach there. We also
    work with many of the associations who follow these regulations
    very closely. We make sure we get the word out to them. And, we
    have regular listening sessions with them to hear about their
    concerns.
        I will note the new comprehensive rule is an interim final
    rule. We took comments on a similar rule in 2011-2012. We made
    some changes, in part in recognition of the concerns of small
    business. We are taking comments again and we very much welcome
    people's comments on how we can improve the program and make it
    usable for them.
        Senator Shaheen. So, just because I am still not quite
    clear, if anybody has--if a company has applied for H-2B visas
    in the past, would they get a notification of proposed rule
    changes, of various outreach efforts that you are doing
    automatically because they are on your list?
        Ms. Wu. They should. They should. I will check with my
    operations people----
        Senator Shaheen. Okay.
        Ms. Wu. Yes, we do.
        Senator Shaheen. Behind you, they are nodding.
        [Laughter.]
        So, hopefully, that means that any New Hampshire company
    that has applied in the past will get those notifications.
        Ms. Wu. Yes, that is our hope.
        Senator Shaheen. Thank you very much.
        Chairman Vitter. Thank you.
        Next is Senator Ayotte.
        Senator Ayotte. Thank you, Chairman.
        I wanted to follow up on the question that Senator Shaheen
    had asked Dr. Solomon about the catfish program. As far as I
    can tell, the U.S. FDA handles seafood inspections for all
    other forms of seafood, correct?
        Dr. Solomon. That is correct.
        Senator Ayotte. And, so, there is no reason why you could
    not continue to handle independently the inspection as you did
    before Congress on its own created this duplicative inspection
    regime, the inspection of catfish, which is actually a low-risk
    species, correct?
        Dr. Solomon. We are currently, since that rule is not in
    effect yet, we are currently handling all the catfish
    inspections.
        Senator Ayotte. And in the end, as I understand it--you
    know, it has been interesting to me, we have nine GAO reports
    on this topic, and those nine GAO reports actually consistently
    recommend eliminating the newly created by Congress USDA
    program that, as I understand--you would not know these
    numbers--but as I understand, has already spent $20 million.
    Not one fish has been inspected. Obviously, the FDA has handled
    the inspection of seafood for a long time. And, here we are in
    the Congress going to--already spent another, you know, USDA,
    trying to stand up duplicative inspection, already spent $20
    million on it, and as Senator Shaheen mentioned, it is going to
    cost USDA, the estimate is, $14 million a year to continue
    doing what you already do quite well.
        So, I do not know if you have had a chance to look at these
    GAO reports. Have you?
        Dr. Solomon. Not nine of them, but I have read some.
        Senator Ayotte. And, do you agree that you can handle the
    inspection of catfish, that we do not really need another
    office to inspect catfish?
        Dr. Solomon. The program has worked effectively as far--
    from FDA's perspective.
        Senator Ayotte. Right. So, this is a great example of
    government run amok, truthfully, because the notion that we
    already have the FDA doing its job inspecting seafood, and to
    carve out just catfish so that we can spend millions of dollars
    more to have the USDA have another office inspecting catfish,
    which you are already doing quite well, for one species of
    fish--you know, these are the kinds of things that I think
    people look at Washington and they say, what are you all doing
    down there?
        So, I really hope, you know, that we will have some common
    sense on this and allow you to continue to do what you have
    been doing historically rather than creating another--
    continuing to plunk millions of dollars into a duplicative
    program.
        I also wanted to follow up, Ms. Wu, on the H-2B issue. I
    share--obviously, I serve in New Hampshire with Senator
    Shaheen, and what I have heard in New Hampshire, many of our
    seasonal businesses depend on these workers. In fact, in
    Portsmouth, Nashua, Laconia, they had the most H-2B visas
    granted. But, the abrupt breaks and a burdensome process,
    especially for smaller business, have been very, very
    difficult. So, when are we going to make sure that we are not
    in the same position we were this year as we look to the
    application process next year, you know, given that this is--
    people have to plan on what their workforce needs are?
        Ms. Wu. Thank you, Senator. It has been frustrating, I
    know. It has been frustrating for us trying to run a program. I
    am sure it has been frustrating and frightening, frankly, for a
    lot of small businesses when these abrupt court decisions come
    along and halt us from doing something we have been doing in
    the program, make us suspend this. I mean, it has really been
    very difficult.
        That is why we asked for a stay with the court order so we
    could keep running the program this spring, and now we have
    issued comprehensive rules--even though the Department of Labor
    believes we have the authority to do this on our own, because
    of the legal challenges, we jointly issued these regulations
    with DHS. So, I think we feel like we are at least insulating
    ourselves from that level of legal attack. Unfortunately, we do
    continue to see attacks from all sides on this program, but we
    hope that brings some certainty and stability. And, we also are
    trying to include some provisions that will make things easier
    over the long run for businesses using this program.
        Senator Ayotte. Well, I really appreciate that, because
    just the feedback I have gotten from businesses in New
    Hampshire on the program is that under the administration, it
    has become more complicated, more difficult, more paperwork,
    and as I look at the new H-2B interim and wage final rules that
    were issued on April 29, it is more than 100 pages, and I see
    the burden on employers increasing. So, I hope when you look at
    this that we need to decrease the burden on employers, not
    create more paperwork, especially when many of them, as you
    know, this is something that they do every year and they have
    been in the program already. So, thank you for being here
    today.
        Chairman Vitter. Thank you.
        And next, we will go to Senator Cantwell.
        Senator Cantwell. Thank you, Mr. Chair.
        Dr. Solomon, I wanted to ask you about Russian pollack.
    Last fall, I sent a letter, led by my colleague, Senator
    Murkowski, to the FDA Commissioner Hamburg requesting to fix
    this labeling problem. The FDA has authority to change the
    acceptable market name of product from pollack, and not just
    Alaska pollack. The change would prevent Russian pollack from
    being labeled as United States Alaskan pollack. So, we
    requested that the FDA make this change in September and now it
    is May of 2015. So, do you agree that the term ``Alaskan
    pollack'' would give consumers the impression that the product
    is from Alaska?
        Dr. Solomon. So, the determination about the species naming
    is handled by our Center for Food Safety and Applied Nutrition.
    They have what they call a seafood list. I know that your
    submission--that issue is before that group. They look at both
    the species name, they work with fish taxonomists and look at
    the DNA sequencing that talks about these different species,
    and I know they have that issue under review.
        Senator Cantwell. And, so, when will we hear about that
    decision?
        Dr. Solomon. I know they are actively working on it. I do
    not have that. We will be happy to try and get back with you.
        Senator Cantwell. Okay. Do you think, in your view, is the
    Russian pollack industry a sustainable fishing industry
    specifically--scientifically, I guess I would say?
        Dr. Solomon. So, I do not think I am qualified to speak on
    that. We look at fish from a food safety perspective and we are
    not, you know, related to the trade issues or other issues
    associated with it.
        Senator Cantwell. Well, I think we see things, obviously,
    about it. They are known for labor issues. Just last month, a
    Russian pollack catcher/processor vessel sank in the Bering
    Sea. Only 63 crew members survived. Sixty-nine were lost. Forty
    percent of the crew were--they are illegally from countries
    like Burma, Ukraine, Latvia. And, so, these lives are being
    lost because of lack of training and survival skills, and then
    consumers are seeing a product that is labeled Alaska and is
    not really Alaskan pollack. So, we hope that you will get a
    decision through the FDA about this and look at both the way
    the industry is operating and the right that consumers have to
    understand this product. Thank you.
        Thank you, Mr. Chairman.
        Chairman Vitter. Okay. Thank you both very much. We will
    excuse you and call up our second panel of witnesses. As they
    get situated, I am going to go ahead and be introducing all
    three of them.
        We are really pleased to be joined by Dr. Mike Strain, the
    Commissioner of the Louisiana Department of Agriculture and
    Forestry, who was elected to that position in 2007, sworn into
    office in January 2008. Dr. Strain holds a Doctorate in
    Veterinary Medicine from LSU and opened the Claiborne Hill
    Veterinary Hospital in Covington soon after he received that
    degree.
        We are also joined by Mr. John P. Connelly, President of
    the National Fisheries Institute, America's leading trade
    association advocating for the full seafood supply chain. John
    was Chairman of the International Coalition of Fisheries
    Associations and a board trustee of the Marine Stewardship
    Council and is currently a board member of the International
    Seafood Sustainability Organization.
        And, we are also joined by Mr. Frank Randol, President of
    Randol, Incorporated. Frank is a seafood processor from
    Lafayette, Louisiana. He has over 40 years of experience in the
    industry and also owns Randol's Restaurant in Lafayette,
    Louisiana.
        Welcome to all of you, and we will start with Dr. Strain.

       STATEMENT OF MIKE STRAIN, D.V.M., COMMISSIONER, LOUISIANA
                 DEPARTMENT OF AGRICULTURE AND FORESTRY

        Dr. Strain. Thank you. Good afternoon, Chairman Vitter.
    Thank you very much for the opportunity to come here and speak
    today. My name is Dr. Mike Strain. I am the Louisiana
    Commissioner of the Department of Agriculture, Forestry, and
    Aquaculture. I am testifying today on behalf of the Louisiana
    Department of Agriculture.
        State Departments of Agriculture are responsible for a wide
    variety of programs, including food safety, combating the
    introduction and spread of plant and animal diseases, and
    fostering the economic vitality of our rural communities. Our
    department oversees all agriculture activities within the
    State, including the markets for products produced by our
    farmers, and especially what we are here to talk about today in
    seafood, in the crawfish industry, which falls under my
    purview.
        First of all, I would like to thank Ms. Wu and other
    members of the Department of Labor for allowing us to come and
    visit with them on March 23 about this issue and have a very
    open and frank discussion.
        Also with me today is the Director of the National
    Association of State Departments of Agriculture, which I am a
    Vice President, Dr. Barbara Glenn. My statement is also
    consistent with the position of the National Association of
    State Departments of Agriculture, representing commissioners,
    secretaries, and directors across all 50 States and four
    Territories, in the development, implementation, and
    communication of sound public policy and programs which support
    and promote American agricultural industry while promoting and
    protecting the environment and our consumers.
        In order to feed our increased U.S. population, we must
    have a stable agricultural labor supply. The ability of
    seasonal businesses to keep their doors open and retain their
    full-time U.S. employees relies upon having successful peak
    seasons to offset the rest of the year when business is slow.
    During their busy seasons, companies must supplement their
    permanent staff with temporary seasonal employees. Employers
    spend thousands of dollars and hundreds of hours in their
    efforts to fill these positions.
        Unfortunately, even in today's tough economic climates,
    there are not enough local workers available to fill all the
    temporary seasonal positions, and efforts to obtain U.S.
    workers to relocate for temporary seasonal employment have not
    been successful. As a result, businesses must utilize the H-2B
    guest worker program to find seasonal workers and workers for
    their peak workforce needs. The H-2B program is vitally
    important for many industries, including forestry, nursery,
    landscaping, outdoor amusement, restaurant and hospitality,
    tourism, livestock, horse training, sugar, and many others.
        In Louisiana, the seafood industry, which includes
    crawfish, shrimp, crabs, oysters, and catfish, is in a critical
    situation because seafood processors traditionally cannot fill
    their temporary or seasonal vacancies with U.S. workers. Many
    of these businesses are located in rural areas that simply do
    not have sufficient populations to supply their extra workforce
    needs. Additionally, many who are willing to work want full-
    time, year-round jobs. Indeed, many of the jobs in these
    locales that are year-round and are full-time depend on the
    various processors operating for their own jobs and business
    operations.
        In 2014, Louisiana hired 5,546 H-2B workers. For each H-2B
    worker, it is estimated that 4.64 American jobs are created and
    sustained.
        Over the last ten years, Louisiana has seen many natural
    challenges to the agricultural sector of our economy, with
    Hurricanes Katrina and Rita, floods on the Mississippi River,
    spilling water through the spillways into the Atchafalaya
    Basin, and drought. The H-2B regulations released on April 29,
    2015, by the U.S. Department of Labor and the U.S. Department
    of Homeland Security could impact an already fragile industry's
    economic competitiveness.
        The seasonal industries have had to weather several years
    of regulatory instability. The H-2B wage rule that the
    Department of Labor adopted on January 19, 2011, imposed a new,
    untested wage determining methodology that would significantly
    increase costs for small and seasonal small businesses. After
    being blocked by Congress in April 2013, the DOL issued an
    interim final rule that included the same methodology for
    setting wages, but recognized the importance of State wage
    surveys. Unfortunately, the new rule released two weeks ago is
    virtually identical to the rule that was blocked by Congress,
    causing additional obstacles for employers in the program.
        In December 2014, the Department of Labor announced that it
    would no longer allow the private wage rate surveys that were
    developed by many State Departments of Agriculture, including
    Louisiana. My staff has spent countless hours gathering
    information to accurately depict the current wages that the
    industry is paying in our geographic location. This action
    forced employers into accepting higher prevailing wages that
    are not representative of the wages that are being paid
    domestically.
        To make matters worse, the H-2B worker caps have already
    been exceeded and now many seafood processors have not received
    the workers that they need. Seafood processing has already
    begun early in the spring, and with the crawfish industry
    especially, it is time sensitive. These actions have a negative
    impact on the seafood industry and related commerce sectors,
    such as restaurants, et cetera.
        Two months ago, the LSU Ag Center conducted a rapid
    economic analysis of the recent H-2B policy changes from the
    U.S. Department of Labor for the Louisiana seafood industry.
    The assessment was conducted in response to potential changes
    in the cost and availability of labor stemming from a mid-year
    cap on H-2B permits and the Department of Labor announcement
    that it would no longer accept the private wage rate surveys.
    Results indicate that for every one dollar of employee
    compensation created by the seafood preparation and packaging
    industry in Louisiana, employee compensation increased by $2.06
    across all sectors of the Louisiana economy. This includes the
    original one dollar of employee compensation created by the
    seafood preparation and packaging industry plus $1.06 of
    induced multiplier effects across all sectors of the economy.
        Total income generated by H-2B visa workers in the
    Louisiana seafood industry is estimated between $36 and $43
    million. Based on the assumption of $35 million in revenue, the
    loss of this revenue for any given number of firms would lead
    to a total reduction in labor income across the entire
    Louisiana economy, eventually leading to a number of companies
    closing. The economic impact of two processing facilities
    closing is $5.3 million, and with five firms shutting down,
    $13.3. Louisiana has already faced a number of processing
    facilities closing due to hurricanes and oil spills and the
    industry simply cannot be sustained without a stable workforce.
        I am certain that not only is the seafood industry in
    Louisiana impacted, but the entire United States seafood
    industry will be affected by these actions. Our markets are
    subject to particularly fierce competition from abroad. For
    example, the Chinese have been extremely aggressive in trying
    to corner the U.S. crawfish market. This predatory practice and
    behavior began in 1993 and it has continued. The Chinese
    presently control over 50 percent of the market and are poised
    to capture even a larger market share if our producers are put
    at a further competitive price and labor disadvantage.
        Without temporary H-2B guest seasonal workers to process
    seafood, Louisiana seafood processors would shut down,
    eliminating the primary market for our fishermen and our
    farmers to sell their catch. As a result, foreign seafood would
    gain a stronger foothold in the U.S. market and our fishermen
    and farmers who produce and harvest crawfish, shrimp, crabs,
    oysters, and catfish would be devastated and a key segment of
    the Louisiana economy crippled.
        Once we lose the processors, we would not be able to depend
    on them coming back in future years. Therefore, the losses
    because of the processors scale back and do not have the
    ability to operate during the season will have irreparable and
    bad repercussions now and in the future.
        The short-term consequence of an immediate expulsion of
    this vital segment of the workforce will cause a production
    crisis in a wide variety of seafood processing, field and
    nursery crops, sugar processing, forestry, livestock,
    restaurant industry, and others. This would leave the United
    States and our State of Louisiana no alternative but to import
    many food products from countries with surplus foreign labor.
    This is unacceptable. We must do everything in our power to
    grow and support America's jobs and economy.
        We are asking for your help. We must streamline and
    expedite the H-2B process. We need a working system without
    overburdensome rules, unrealistic time tables, and outright
    road blocks. Neglecting the labor needs of agriculture will
    raise the costs of production in a way that harms farmers,
    fishers, and industries throughout America.
        I appreciate your time and encourage you to work with us to
    find workable solutions, ways that we can facilitate rather
    than making it so difficult to where our processors and our
    industries cannot operate. Where we are at currently, we have a
    large crawfish harvest and we do not have enough peelers to
    process it and that puts us in a severe economic state, and I
    am sure Mr. Randol will address that, as well.
        Thank you.
        [The prepared statement of Dr. Strain follows:]

     [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Chairman Vitter. Thank you very much, Dr. Strain.
        We will now go to John Connelly. John, welcome.

     STATEMENT OF JOHN P. CONNELLY, PRESIDENT, NATIONAL FISHERIES
                               INSTITUTE

        Mr. Connelly. Thank you, Chairman Vitter, for inviting the
    National Fisheries Institute to present our views today. Our
    comments will include a brief introduction, the importance of
    H-2B visas to seafood processors, the economics of the American
    seafood industry, and the U.S. seafood safety system and its
    results.
        NFI is the nation's most comprehensive trade association.
    Our members include harvesters, like those on ``Deadliest
    Catch,'' to importers who enable us to enjoy seafood from
    around the globe, to processors who put fish in a form that
    consumers recognize, to retailers and restaurants. We do
    represent all geographic regions, and we were particularly
    proud to have had the late Louisiana seafood leader, Mike
    Voisin of Motavatit Seafood in Houma, as our Chairman.
        On H-2B visas, a functioning H-2B system is essential to
    seafood processors. Senator Mikulski captured many of the
    Senator's concerns in her letter to Secretary Johnson last
    week. Quote, ``The lack of available temporary foreign workers
    has caused chaos among businesses in Maryland that depend on
    the H-2B program. More than 40 percent of Maryland's seafood
    processors have been unable to get the workers that they need
    for the 2015 crab season.'' I think Dr. Strain pretty much said
    it all, and I think that is reflective of the rest of the
    seafood community in the U.S.
        On economics, seafood is the most globally traded food
    commodity. That benefits our fishing communities, as we send
    high quality and bountiful American seafood to Northern Asia
    and throughout Europe. Trade also benefits the more than
    525,000 Americans that process, distribute, and sell imported
    seafood. Those jobs are found in nearly every State and are an
    important reminder that trade benefits the U.S. not just when
    we export.
        Seafood trade also benefits farm States in two ways. About
    18 percent of all soy goes into fish farms, many of those fish
    farms in Asia. And, two, the countries to which American
    farmers increasingly seek to send our ag products are countries
    that export seafood to America. We cannot expect to open Asian
    markets to U.S. pork, beef, poultry, corn, dairy, and soy if we
    shut off access to our seafood markets.
        To seafood safety. NFI has been a long and strong supporter
    of seafood safety in word and deed. NFI has worked closely with
    academia and regulators to understand how to best implement
    HACCP. NFI joined you, Mr. Chairman, as an early and strong
    supporter of FSMA. And, NFI works with the Alliance for a
    Stronger FDA to urge Congress to appropriate the needed
    resources for the agency to meet its statutory obligations.
        As Dr. Solomon aptly and fully described the HACCP system,
    I will not duplicate that extensive discussion.
        I will close, though, speaking to results. Results, after
    all, are what matters. The fact is, the Centers for Disease
    Control analyzed and reported illnesses from all foods. Over
    the five-year period ending in 2010, CDC found that 141 of
    122,000, that is, 0.001156, or 0.12 percent of illnesses were
    caused by imported seafood.
        Most of us love baseball. It is a great day to go down to
    the Nats game. But, we recall going to the games with our dads,
    clutching that mitt, and hoping to catch that foul ball.
    Unfortunately, we often came home crestfallen because we
    rarely, if ever, did, because the chance of catching a foul
    ball is the exact same as becoming sick from imported seafood,
    0.001156, or 0.12 percent.
        As an example of the effectiveness of the FDA, and again,
    while the hearing focus is not on the USDA catfish program, I
    did want to acknowledge the leadership of Senators Shaheen and
    Ayotte and others on this committee in working in a bipartisan
    manner to eliminate a program that USDA's own risk experts have
    said will not improve public health, primarily because the FDA
    regulation of catfish, both domestic and imported, has reduced
    illnesses to less than two per year. That is a safe product.
        It is because of the stringent requirements of HACCP, a
    system required for both domestic and imported seafood, a
    system that requires problems to be fixed thousands of miles
    away from America and not caught at the border, that Congress
    acknowledged and exempted companies in seafood HACCP compliance
    from some of FSMA's key provisions. NFI agrees with Congress'
    determination. The safety of domestic and imported seafood is
    excellent.
        Thank you.
        [The prepared statement of Mr. Connelly follows:]

     [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Chairman Vitter. Thank you very much.
        And now, we will hear from Mr. Frank Randol. Frank,
    welcome.

        STATEMENT OF FRANK B. RANDOL, PRESIDENT, RANDOL, INC.,
                             LAFAYETTE, LA

        Mr. Randol. Thank you, Chairman Vitter, and for the members
    that are not here, Ranking Member Shaheen, Senator Cardin. I
    want to thank you for inviting me here to testify about the
    guest worker program that we refer to as H-2B.
        The program is a vital part of the survival--this program
    is vital to the survival of seafood processing, especially in
    Louisiana and Maryland. The program--I will--and I am getting
    shook. Excuse me. Just let me go.
        Chairman Vitter. Sure.
        Mr. Randol. It is vital. I will submit my statements for
    the record, in addition to a number of exhibits that will
    provide a useful reference for the committee. I will now
    provide my oral comments.
        I am here to express my concerns for the future of my
    business and other small businesses that struggle daily to
    succeed. I started Randols in 1971, starting small--one man,
    one truck. After four decades, Randols has grown in size and
    scope. We are transitioning to the next generation. The future
    is in my sons that work my business, allowing me to pull back.
        Hurdles over the last four years were detailed by the
    Commissioner--floods, hurricanes, oil spills, lack of product,
    predatory imports from China, yet the single most pressing
    issue for us has always been the lack of labor.
        In the 1970s, when I started my business, I was lucky
    enough to have the refugees from Vietnam come in, so we brought
    in roughly 40 to help us get through that time. Over the course
    of the years, we came to the 1990s, when that started to wane
    just a little bit. We discovered the H-2B program and started
    bringing in the guest workers from Mexico. We started with 40,
    dwindled to 30, now we are to 25.
        I am here to talk about the H-2B guest worker program, the
    legal--legal--temporary workers that we get from visas to
    support businesses from farming, fishing, to restaurants,
    wholesale, and retail food operations. The attached
    declarations that I have submitted from Dr. Strain, filed in
    our suit of 2011 against the Department of Labor, gives an
    overview of the importance of the H-2B program to the Louisiana
    economy.
        The H-2B application process has been a growing and
    expensive challenge. Since DOL took over the initial wage
    certification from the State in 2008, the process has become
    increasingly more time consuming and costly. Initially, I did
    the paperwork myself, but now, I have to turn it over to
    someone else more qualified to run through the governmental
    hoops. Many people are using legal or international immigration
    attorneys to do their paperwork. The stack of paperwork here
    represents what was submitted on the October 2014 application
    for the first cap. The same amount was resubmitted for the
    second cap, so it would be twice that stack.
        We missed both caps. Our plant was scheduled to open
    February 2015. We are still waiting to see if we will be
    getting any workers this year so we can open and salvage a part
    of it. Last year, we were processing between 6,000 and 8,000
    pounds of seafood daily, and like I said, right now, we are
    shuttered.
        Often, we hear the remark, why, if you pay more money, then
    you will get the labor you need. We feel that that is not the
    case. It is more about the job than the money in our seafood
    industry. After missing the cap--both caps--we tried something
    different, seven prison trustees. After one day, one prison
    trustee said, ``I would rather go back to jail than to peel
    crawfish.''
        [Laughter.]
        The warden picked him up, brought him back, we did not see
    him again. The remaining trustees continued to shrink until
    after a two-week effort, they were all gone.
        Now, union activity has started to increase and created
    problems for us, and recently, the NLRB has surfaced and
    getting involved. We have referenced this in documents that we
    brought as exhibits.
        We need--urgently, we need fixes to save the H-2B program
    for small businesses. Congress has to take action now. The lost
    opportunity to fix the problems created by DHS and DOL last
    year have already done severe harm in Louisiana. Some of
    Louisiana's small businesses will not recover. Others may be
    forced to cross the border. As in the past, we need immediate
    Congressional action to block the new DHS and DOL proposals of
    last Wednesday. The H-2B Workforce Coalition has submitted a
    statement which we have attached as an exhibit.
        In addition, we need to resume the H-2B returning worker,
    guest worker exemption from the annual cap. We also have to
    return to the authority of determining prevailing wages to the
    States. Additionally, we feel we need a seat at the table with
    DOL, just like the National Guest Workers Alliance. SBA's
    Office of Advocacy needs to be more aggressive in confronting
    DHS and DOL as policy changes are being discussed.
        And, part of what came up today, as I was listening to the
    testimony, is what we have been hearing, that somehow, what is
    happening here was caused by a judge or was caused by industry.
    You know, we just do not see it that way. We are small people,
    but we do know that no matter where it was caused or what,
    somehow, when something like this happens, if there is an error
    or whatever, the people that make the error still have their
    jobs. But in our case, we are small. We do not survive.
        So, there is some give and take that has got to take place
    here, and that is really why I am here. Somebody had to come up
    and tell you about what is going on back home, the little guys
    that are having problems. And, some of the big guys have the
    same problem. Hershey had these problems the last part of--from
    2007 on to 2011 when they decided to open up in Monterrey,
    Mexico, and most of their growth has already been funneled into
    that plant for their--American chocolate is now the Americas'
    chocolate.
        We have one right here, Elmer's, Louisiana, Ponchatoula,
    largest employer in Ponchatoula. He hires--he uses H-2B. He
    missed the cap and he is struggling. He is trying to make his
    orders for this year. Small business. He is up against somebody
    like Hershey. I am not saying that they are going to Mexico.
    This is good chocolate. It needs to stay home.
        I would be happy to answer any questions you may have.
    Thank you again.
        [The prepared statement of Mr. Randol follows:]

     [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Chairman Vitter. Thank you very much, Frank, and let us
    start with you, since you offer such a great real world
    perspective.
        If you can--I know you touched on it in your testimony--
    walk through the specific, concrete impact to your business
    that the various recent Department of Labor changes and rulings
    have had, number one. Number two, if you have any reaction so
    far--and it may be too new, maybe you do not--but, if you have
    any reaction so far of the new Department of Labor guidance
    moving forward on wage surveys.
        Mr. Randol. Let me start from the back. It is more of the
    same, as I see it, from DOL. We have reviewed this stuff. It is
    stuff that does not work. I mean, program rules, 75 percent
    guarantee. Hurricane comes, I cannot turn them back, got to
    keep them for ten months and got to pay them. That does not
    work in Louisiana.
        As far as the parity, if I pay one person this, another
    person has to be paid the same. In the seafood industry, we pay
    for productivity. You know, we might bring them in at entry
    level, but we give them the incentives through piece work. They
    accelerate. They get better. They might enter at a nominal
    rate, but a lot of these people get up to these larger rates,
    $12 to $15 an hour, peeling crawfish. That is attainable.
        Chairman Vitter. Just to take those two examples, as far as
    you know, is any of that mandated by statutory law, or is it
    just a creation of the Department of Labor?
        Mr. Randol. Creation. These mandates are killers for us.
    You know, you all write the laws, they interpret the laws, and
    then we try to say that is not what you meant, and that is what
    I have been doing for the last decade. You saw me up here in
    2006. It was very easy to predict or see where we were going,
    and now we are here, you know, when I first came to discuss
    this. The pain is in reality, and the pain to me. I feel it
    because I am in it and I cannot get out of it.
        We got through the process. We missed the first cap. I have
    been at this for a half a year, trying to make a deadline that
    was imposed--I can only start four months before I need them,
    four months, and I have been at it for six months and I am
    still not in the last step, which would gain me access in six
    weeks to bring them in. The real lifting is at the border to
    determine whether these people really need to come in. We
    demonstrated that we do not have the workforce here, but----
        Chairman Vitter. Frank, if I can interrupt for a second, if
    I can just through the record ask Ms. Wu, we talked about two
    specific requirements that you mentioned that are just flat out
    unworkable in the real world from your perspective. Ms. Wu, if
    you could submit for the record any statutory basis that
    requires the Department of Labor to do that, because from what
    I see, there is none. Thank you.
        Go ahead, Frank.
        Mr. Randol. Okay. The last one, we see that a lot of this
    stuff is outlined in the H-2B Coalition paper, but what comes
    to mind is open up a job order that starts four months out and
    you have to take it 20 days to where these people are coming
    inside the country and leave it open. So, normally, we--you
    know, we have demonstrated that there are no people that want
    this job. But these are just some of the few, and what I have
    offered to DOL is, you know, the NGA apparently has their ear.
    Let us let small business somehow be in the process so that we
    do not see the results of a mandate, but we have a team effort
    to try to move forward. Because, like I say, when they impose
    these things, we feel the pain. A lot of people go out of
    business.
        Chairman Vitter. Right. Let me ask both you and Dr. Strain
    if you have any specific reaction yet to their new guidance
    about allowing private, including State, surveys. Is it
    workable? Is it not? Is it reasonable? Is it too narrow? Do you
    have any reaction yet?
        Dr. Strain. Mr. Chairman, the reaction I have is that we
    have been using the State prevailing wage rate surveys for many
    years, and when you look at the final rule, it says they will
    be used in limited exceptions. And, so, now we have several
    different methodologies to determine a wage rate. I mean,
    simply let us continue to use the prevailing wage rate rule.
        If you look at it in the seafood industry and the crawfish
    industry, the State prevailing wage rate, as determined by the
    LSU Ag Center and my office, it is currently $8.66. That is a
    floor. But, they are also paid on piecemeal, and you have
    some--you have workers that make $12, $15, $18 an hour
    depending on production. This sets a minimum wage.
        So, let us not--if you look at what is in the interim rule
    there, it is very--it is complicated. We need to simplify this.
        Chairman Vitter. Okay. And, Dr. Strain, I also wanted to
    touch on my Imported Seafood Safety Act.
        Dr. Strain. Yes, sir. Please.
        Chairman Vitter. As you know, we have worked on it
    together. We have talked about it. As you know, it would give
    States more power to increase seafood inspections for foreign
    imports----
        Dr. Strain. Yes, sir.
        Chairman Vitter [continuing]. In conjunction with the
    Federal Government. We have talked about this before,
    essentially empowering you to reinforce the effort of the
    Federal Government to put more cops on the beat. We do this in
    many other areas where the primary regulation is at the Federal
    level, but related State entities can help enforce that. What
    is your view on that and how it could improve seafood safety?
        Dr. Strain. Mr. Chairman, the American public, when they go
    to the market, 100 percent of the mammalian proteins for beef
    and pork and 99 percent for poultry--there is a specialty thing
    for poultry, if you have a very small amount, less than 10,000
    chickens, you can sell them, but it is very tiny--but all those
    proteins are inspected. They are monitored from the farm all
    the way through slaughter. They are inspected at slaughter and
    they are tested and back-traced. The American public believes
    their seafood that they consume is inspected and safe at that
    same level.
        If you look at the CDC report, and I am going to quote
    their press release, March 14, 2012, it says that we currently
    import about 85 percent of our seafood, 60 percent of our fresh
    produce, and we currently import about 50 percent of our
    crawfish. And, I quote, ``CDC experts reviewed outbreaks from
    their Foodborne Disease Outbreak Surveillance System from 2005
    to 2010. During that five-year period, 39 outbreaks, 2,348
    illnesses, were linked to imported food from 15 countries. Of
    those outbreaks, 17, half, occurred in 2009 and 2010. Overall,
    fish, 17 outbreaks, were the most common source of implicated
    imported foodborne disease outbreaks, followed by spices.
    Nearly 45 percent of the imported foods causing outbreaks came
    from Asia.''
        The American public assumes that we are doing this testing.
    We know that we are not. Less than three percent of the
    imported seafood. Eighty-five percent of the seafood consumed
    in the United States is imported, and less than three percent
    is being tested.
        Furthermore, when you look at that particular issue, if you
    look in a container of seafood, there could be, in the case of
    crawfish, there could be up to 20 different lots--20 different
    lots, different origins, coming together. So, when you think
    that it is all a blended product and you take one sample and
    that it is consistent with everything in the container, it is
    not.
        And, when you look at the particular issues that we are
    talking about, we are talking about antibiotics that are banned
    from the United States, such as chloramphenicol, chemicals such
    as malachite green that are banned from the United States.
        And, so, when you look at that, it is imperative that we
    all be on the same level playing field. And, when you start
    talking about why we need to test this seafood and you say,
    well, how are we going to stop port shopping, well, it is very
    simple, is that we need to make sure that we have eyes on at
    the processing level in those foreign countries, and I think
    some of that will take into effect in the future under the Food
    Safety Modernization Act, but that is somewhere in the future,
    and that container be accompanied by a certificate stating that
    it has been tested, and that when--if you get--and if that
    container comes in and you retest that container and it is not
    what it says, then it can either return directly and be
    certified to go back to the country of origin or be destroyed
    on site.
        Now, our department, I am responsible--I oversee the
    Department of Animal Health and Food Safety and we have a food
    inspection program. We also work hand in hand with the USDA
    Animal and Plant Health Inspection Service, to where we do
    joint meat inspection. We do State plants and we can work
    jointly on Federal plants where those products can cross State
    lines. But, I am not permitted to test imported seafood. Now, I
    can look at the containers to make sure that, and as I, as the
    Commissioner of the Office of Metrology, Weights, Measures, and
    Standards, that if there is a pound of seafood in there, there
    is supposed to be a pound. But, we are not allowed to take
    samples and test it for contaminants.
        So, just like we are having a working relationship and we
    have a cooperative endeavor agreement with the Federal
    Government to do the other protein inspections, let us have the
    same arrangements where my inspectors who are out at those
    plants looking at other things--and we do label inspections for
    the Federal Government, as well--give us the authority under
    cooperative endeavor agreement to be a further arm. We have
    testing labs in Louisiana. We do half of the seafood testing.
        Chairman Vitter. And, so, if that were done, which I
    certainly support and am advocating through my bill, that would
    be fully consistent with the Federal standards. It would not be
    using different standards in any way. You would just be
    additional cops on the beat, correct?
        Dr. Strain. That is correct. And, if you--and, what we do,
    our standards, our procedures are in alignment with the Federal
    procedures.
        Chairman Vitter. Right. Right.
        Dr. Strain. And, we should have standards as high as the
    European Union.
        Chairman Vitter. Right.
        Dr. Strain. They test, and I believe it is up to 15 to 20
    percent of all the products going to the EU. We should meet at
    least those standards.
        Chairman Vitter. Right. Well, thank you all very much.
        We are going to wrap up, but in doing so, let me also ask
    through the record if Dr. Solomon could supplement his
    testimony with a response to this question. Dr. Strain
    mentioned the use of chemicals on imported seafood that are
    banned in the United States. Why should not that practice be
    presumptive grounds to not allow that seafood into the country,
    if Dr. Solomon could respond for the record.
        Thank you all very much. I think this was very informative
    and productive, particularly focusing on Department of Labor
    activity and regulations and the safety regime for seafood
    imports.
        Thanks very much, and our hearing is adjourned.
        [Whereupon, at 3:54 p.m., the committee was adjourned.]

                          APPENDIX MATERIAL SUBMITTED

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]