[Congressional Record Volume 144, Number 50 (Wednesday, April 29, 1998)]
[Extensions of Remarks]
[Page E709]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   INTRODUCTION OF H.R. 3744 LEGISLATION AMENDING THE FOOD FOR PEACE 
                                PROGRAM

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                     HON. GEORGE R. NETHERCUTT, JR.

                             of washington

                    in the house of representatives

                       Wednesday, April 29, 1998

  Mr. NETHERCUTT. Mr. Speaker, today I introduced a bill designed to 
help farmers participating in the PL 480 Food for Peace Program who 
have experienced trouble moving their product by rail to U.S. ports.
  Under PL 480, the Department of Agriculture invites farmers and 
processors to sell their product (e.g. grain, peas, lentils, barley) to 
the federal government. At the time they advertise their tender, the 
Department also specifies where and when the product has to be 
delivered. Farmers and processors are able to calculate their bids 
based on the cost to produce, the cost associated with rail shipment, 
the time normally required to get empty rail cars, and the time needed 
to have the railroad move cars to the port specified by the Department. 
Successful bidders sign a contract with the Department prior to 
shipping their product, but they don't receive payment from the 
government until after it is delivered to the port.
  This arrangement has generally worked well over the years, but last 
summer and fall a large number of farmers and processors--through no 
fault of their own--experienced tremendous difficulty abiding by the 
terms of their contracts with the Department. Rail congestion in the 
midwest and west caused many shipments to arrive late, thus missing 
sailing dates and generating expensive damage claims against farmers 
and processors. My bill would hold farmers and processors harmless 
against these kinds of damages.
  It is unreasonable for the government to hold farmers and processors 
liable for damages in instances where they make a good faith effort to 
load and transport their product on a timely basis. Farmers and 
processors surrender their product to a railroad for shipment to a 
port, but they have no ability to control its delivery and, under 
current program rules, they pay damages for late arrival.
  As an aside, I am aware that the Department of Agriculture has 
relieved some PL 480 participants from damages arising from last 
summer's rail service difficulties in the midwest, but I don't think it 
prudent to leave the issue of future damages to the discretion of the 
Department. Farmers and processors need the certainty of knowing that 
they will not be liable for transportation problems beyond their 
control.
  I ask all Members to cosponsor this legislation. The PL 480 Food for 
Peace Program is an important market for many farmers and processors, 
but under the current rules, it presents a whole host of unknowns that 
jeopardize future participation, especially in light of ongoing rail 
service problems.

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