[Congressional Record (Bound Edition), Volume 151 (2005), Part 17]
[House]
[Pages 23097-23103]
[From the U.S. Government Publishing Office, www.gpo.gov]




      MOTION TO GO TO CONFERENCE ON H.R. 2744, AGRICULTURE, RURAL 
    DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND RELATED AGENCIES 
                        APPROPRIATIONS ACT, 2006

  Mr. BONILLA. Mr. Speaker, pursuant to clause 1 of rule XXII, and by 
direction of the Committee on Appropriations, I move to take from the 
Speaker's table the bill (H.R. 2744) making appropriations for 
Agriculture, Rural Development, Food and Drug Administration, and 
Related Agencies for the fiscal year ending September 30, 2006, and for 
other purposes, with a Senate amendment thereto, disagree to the Senate 
amendment, and agree to the conference asked by the Senate.
  The SPEAKER pro tempore (Mr. Terry). The question is on the motion 
offered by the gentleman from Texas (Mr. Bonilla).
  The motion was agreed to.


               Motion to Instruct Offered by Ms. DeLauro

  Ms. DeLAURO. Mr. Speaker, I offer a motion to instruct conferees.
  The Clerk read as follows:

       Ms. DeLauro of Connecticut moves that the managers on the 
     part of the House at the conference on the disagreeing votes 
     of the two Houses on the Senate amendment to the bill, H.R. 
     2744, be instructed to:
       1. Recede to the Senate on Section 785 of the Senate 
     amendment, and
       2. Agree to a provision that restricts, within the scope of 
     conference, the availability of funds to reimburse 
     administrative costs under the Food Stamp Act of 1977 to a 
     State agency based on the percentage of the costs (other than 
     costs for issuance of benefits or nutrition education) 
     obtained under contract.

                              {time}  1315

  The SPEAKER pro tempore (Mr. Terry). Pursuant to clause 7 of rule 
XXII, the gentlewoman from Connecticut (Ms. DeLauro) and the gentleman 
from Texas (Mr. Bonilla) each will control 30 minutes.
  The Chair recognizes the gentlewoman from Connecticut (Ms. DeLauro).
  Ms. DeLAURO. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise to offer this motion to instruct. This motion 
will instruct House conferees for the fiscal year 2006 agricultural 
appropriations bill to insist that none of the funds made available by 
this or any other act be used to close or relocate a county or local 
Farm Service Agency office until the Secretary of Agriculture has 
determined the cost effectiveness of such closures.
  It would also set a limit on the funds available for States to 
contract out work being carried out under the Food Stamp Act of 1977.
  I want to first say that it has been a pleasure working with the 
gentleman from Texas (Mr. Bonilla) and his talented staff to put 
together the fiscal year 2006 agricultural appropriations bill, doing 
the best we could with very limited resources.
  Under the circumstances, it is a bill that I was proud of, my first 
as ranking minority member of this subcommittee. I also want to thank 
the gentleman from Wisconsin (Mr. Obey).
  Mr. Speaker, I join with my colleagues to offer a motion that would 
in essence codify the decision announced yesterday by the U.S. 
Department of Agriculture to shelve its so-called FSA Tomorrow Plan, a 
plan that would have closed 713 of the Farm Service Agency's 2,351 
offices across America, including two in my State of Connecticut. Had 
the plan gone into effect, more than a quarter of FSA's total field 
offices would have closed at a time when rural America is battling 
drought, the aftermath of Hurricane Katrina, and skyrocketing energy 
costs, all leading to what has been a steady deterioration of its 
economic base.
  For those unfamiliar with FSA, the Farm Service Agency administers 45 
different programs designed to meet the demands of our increasingly 
diverse agricultural landscape. It provides critical services to 
America's farmer, services such as assistance to specialty crop 
producers, disbursal of payments for programs such as the tobacco and 
peanut buyout, and the handling of disaster assistance payments.
  But perhaps more importantly, FSA offices provide that critical link 
between the farmer and the Federal Government. In that respect, FSA 
still retains its roots in FDR's New Deal which established that the 
Federal Government had an appropriate role to play in ensuring a 
healthy rural economy, a critical component to managing the national 
economy.
  Over the years, the agency that became the FSA managed programs such 
as the standard Rural Rehabilitation Loan Program, which provided 
credit, farm, home management planning and technical supervision to 
farms. It helped farmers and their debtors arbitrate agreements and 
head off foreclosure. Indeed, FSA's focus has changed as the need has.
  After Pearl Harbor the War Food Administration was organized to meet 
the increased needs of a country at war. And in 1994 USDA reorganized 
what is now the Farm Service Agency, which included the Agricultural 
Stabilization and Conservation Service, the Risk Management Agency, and 
the Farm Credit portion of the Farmers Home Administration.

[[Page 23098]]

  In recent years, FSA has become part of USDA's one-stop concept, a 
clearinghouse for the delivery for farm programs, where farmers can go 
for programs that help them stabilize farm income, conserve land and 
water resources, provide credit to new or disadvantaged farmers and 
ranchers, and help farm operations recover from the effects of 
disaster.
  In recent months, however, USDA was planning what was called FSA 
Tomorrow, which ostensibly was designed to provide better staff, better 
equipped and trained offices to improve flexibility and efficiency and 
to modernize technology. These were all laudable goals, despite real 
challenges posed by that digital divide and lack of Internet access in 
rural America.
  But central to FSA Tomorrow was its proposal to close over 700 FSA 
offices. The effect would have been clear and immediate, making it more 
difficult for producers to participate in USDA programs. Closing these 
offices would have fragmented the one-stop concept, forcing many 
farmers to drive hundreds of miles to the nearest FSA office where some 
of the closings are occurring in areas with an already high 
concentration of underserved minority and small-operation farms.
  This was all happening at a time when FSA services were as critical 
as ever in modern memory. Even before Katrina there was extensive work 
going on for hurricane and flood relief for the Southeast and mid-
South, as well as work around drought problem in the Midwest; and we 
know the havoc Katrina wrecked on the gulf coast.
  What was most worrisome about the FSA Tomorrow Plan was its 
formulation by USDA without any cost analysis to show why it was 
necessary, nor was there any input from Congress. Thankfully, in the 
wake of Senate action, USDA announced yesterday that it would set aside 
FSA Tomorrow and its timetable for implementation.
  As such, we offer this motion today to codify that decision, 
protecting Congress' jurisdiction in the formulation of policy so vital 
to American farmers' interest. We all support improving FSA efficiency, 
streamlining the program so that our farmers can get the best services 
possible. But I think yesterday's decision confirmed that ensuring FSA 
field offices remain open and within reach of our farmers is a critical 
piece of making that happen.
  Mr. Speaker, the second component of this motion would instruct 
conferees to limit the availability of food stamp funds that can be 
contracted out by States. Specifically, such language would prohibit a 
State agency from using Federal funds if they privatize a certain 
percentage of their food stamp program operations.
  What this is about is ensuring the integrity of the Food Stamp 
Program, which, Mr. Speaker, is one of the most effective, well-run 
Federal programs that we have. If you have any doubt about that, I 
point you to the program's remarkable response to Hurricane Katrina.
  Today, in Louisiana nearly 300,000 households are already receiving 
food stamps. In Texas there are another 125,000 households receiving 
emergency food stamp assistance. Altogether, nearly a million citizens 
affected or displaced by Hurricane Katrina, children, seniors, are 
receiving emergency food stamp benefits, 25 million Americans in all, 
reminding us once again that good and decent societies take care of 
their most vulnerable.
  But as we speak, at least one State is planning on delegating an 
unprecedented billion dollar privatization contract. Texas is hoping to 
delegate certification and enrollment of recipients for food stamps to 
a private firm, Accenture, LLP. Its plan is disturbing, to say the 
least, as its Health and Human Services Department would lay off at 
least 1,200 stamp workers, closing more than a third of State-run 
eligibility offices around the State, 99 in all. Texas is planning to 
replace staff at low hourly rates.
  The responsibility for screening applicants, filling out web-based 
forms and driving clients to the remaining offices for certification, 
that would fall to community organizations. Much like with farmers in 
the proposed FSA office closing, clients, including their children, 
seniors and many who do not speak English, would be forced to travel 
long distances for these services.
  There are a host of problems with the Texas plan. For one, it appears 
illegal, conflicting with Federal statutes governing the Food Stamp 
Program, which requires States to seek a waiver from the USDA.
  In a letter to the ranking member on the Senate side, the USDA said 
the following: We do not have enough information to ascertain whether 
or not Texas' proposal is in compliance with the act in regard to the 
certification of recipients. States are required to seek a waiver from 
the USDA, and Texas sought no such waiver. Indeed, USDA has raised 
questions directly to the Texas Health and Human Services Commission 
for over a year, asking it for information demonstrating this contract 
is in compliance with Federal law, and has received no real response.
  Secondly, there are several worrisome conflicts of interest. The 
Houston Chronicle reports that the HHS Chief Information Officer 
involved in contract negotiation was once an employee of a firm that 
partnered with Accenture. Additionally, the former HHS Deputy 
Commissioner who helped develop the bidding procedures subsequently 
went to work for Accenture.
  What makes this so unfortunate is that it is so unnecessary. The Food 
Stamp Program right now is operating with the lowest error rate it has 
ever had, the result of years of work by USDA and by State and local 
employees all over the country. Texas itself has a very well-operated 
program. Why take the risk that a well-run program will, even with the 
best intentions, be put at risk?
  Let me just say, of all the companies with which the government can 
do business with, I have serious concerns about the company that has 
been awarded this particular food stamp contract. Accenture is a 
corporate expatriate, a company that has set up paper offices overseas 
to avoid paying American taxes, yet comes back to feed at the Federal 
trough by way of government contracts when it is convenient.
  One need only to look at the Department of Homeland Security's $10 
billion US-VISIT Program which Accenture oversees to understand such 
concerns. That contract is over budget, behind schedule, and falling 
well short of its goals.
  Mr. Speaker, this is not simply about an isolated issue in Texas. The 
taxpayers all over the country pay half of the costs of running the 
Food Stamp Program. We have an obligation to ensure that that program 
is run effectively and efficiently and in compliance with the law. 
Moreover, before other States go down the same path as Texas, we need 
to be sure we understand what the implications are first.
  That is what this motion would accomplish. Protecting vital services 
and benefits offered through the Food Stamp Program is something all of 
us share, which is why we need to ensure that those charged with 
administering and carrying out these programs are by and large public 
employees. They are the ones with the expertise. They are the ones with 
the experience on the front lines. And, Mr. Speaker, they were the ones 
who made it possible for the victims of Hurricane Katrina to put food 
on the table, who showed us that even in the face of all those failings 
of leadership government can make a difference in people's lives.
  Making sure that continues is what this motion accomplishes.
  Mr. Speaker, I reserve the balance of my time.
  Mr. BONILLA. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in opposition to the motion but first I would 
like to say, Mr. Speaker, that it is a pleasure to work with my ranking 
member from Connecticut, a person who comes to work every day wanting 
to see some serious work done and a colleague who has always been very 
direct about what she wants to accomplish even when we do have 
disagreements.
  On this particular motion I do agree with a portion, in the principle 
of what the FSA portion says in this motion. The gentlewoman is correct 
the Department of Agriculture went about

[[Page 23099]]

there the wrong way in terms of trying to select offices around the 
country without any input, without any input from the House or the 
Senate or, if they did choose to listen to input, completely ignored 
what we had to say.
  When I had conversations with those in charge at USDA, I pointed out 
initially that if there are going to be cuts, we understand that cuts 
need to be made. Everybody understands that, but we wanted to make sure 
that if cuts were made and designated positions were listed that they 
had to have an equal number of positions here at USDA, at the big 
conglomerate that we have here in Washington.

                              {time}  1330

  Do not just cut the field staff that serves farmers and ranchers 
around the country; but, again, let us make it fair and let us talk 
about it. First and foremost, we wanted to talk about it openly and 
have input because we are the legislative body that has oversight on 
what the executive branch does.
  So I do agree with what the gentlewoman has to say. However, the 
administration has already acknowledged and listened to these remarks 
that many of us have made in the House and Senate and has chosen to 
backtrack and withdraw the list of proposed cuts, offices to be closed 
that was put out just a few days ago.
  On the other part of the motion, I would differ greatly with the 
gentlewoman from Connecticut on the food stamp outsourcing, because as 
the gentlewoman understands, I support the food stamp program 
wholeheartedly and it has been historically supported wholeheartedly in 
a bipartisan way. We have never run short on the program, and everyone 
who needs to take part in this program has always had a meal and had 
the food products they needed in their homes regardless of where they 
live or their ethnic background or what part of the country they come 
from. But this language, in my view, would tie the hands of some States 
that are implementing the program and distributing the benefits 
effectively, including my home State of Texas. But this motion to 
instruct would also encompass Florida, Pennsylvania, New York, and 
California.
  Now, in terms of outsourcing, it is my very strong belief that if a 
State is administering the program effectively and they have no 
outsourcing, that is wonderful. That is fine. But if another State 
decides, as we do in the State of Texas do it, and I believe the 
statistic now is about 14 percent of the program is now outsourced, and 
it works well, then we ought to be allowed to do that. So all I am 
saying is that the language in this motion to recommit would 
inappropriately indicate that Congress does not feel like the States 
ought to be able to administer this program the way they see fit in 
their community to effectively get the product to the people truly in 
need. So that is my reason for opposing this motion to instruct.
  Mr. Speaker, I reserve the balance of my time.
  Ms. DeLAURO. Mr. Speaker, I yield 1 minute to the gentleman from 
Missouri (Mr. Skelton).
  Mr. SKELTON. Mr. Speaker, today I rise in support of the motion to 
instruct the conferees regarding the USDA spending bill offered by the 
gentlewoman from Connecticut (Ms. DeLauro). The gentlewoman from 
Connecticut has been a diligent advocate for the Nation's farmers 
during her first year as ranking member on the Subcommittee on 
Agriculture, Rural Development, Food and Drug of the Committee on 
Appropriations, and I am proud to have watched her work successfully on 
behalf of the agricultural interests of my home State of Missouri.
  Mr. Speaker, this motion asks the conferees to recede to the Senate 
language that stops the United States Department of Agriculture from 
going forward with its plans to close the Farm Service Agency offices, 
an initiative they call FSA Tomorrow, during fiscal year 2006.
  Now, while I join most of my colleagues from rural America in 
applauding the USDA for backing away from this proposal yesterday, 
Congress must make it crystal clear that the administration's plan is 
bad, bad for farmers, and that we will not fund FSA office-closings 
whatsoever. This is especially true since there has been nothing 
written in the law to prevent USDA from having a sudden change of heart 
and within the next 12 months closing the offices.
  Ms. DeLAURO. Mr. Speaker, I yield 6 minutes to the gentleman from 
Wisconsin (Mr. Obey).
  Mr. OBEY. Mr. Speaker, I thank the gentlewoman for yielding me this 
time.
  Mr. Speaker, this motion is really meant to do two things: it is 
meant to rein in bureaucratic arrogance on the part of USDA, and it is 
meant to rein in bureaucratic arrogance on the part of the State 
government of Texas. With respect to USDA, this motion would prevent 
the arbitrary and secret closing of almost one-third of Farm Service 
Agencies around the country.
  In the agriculture appropriation subcommittee hearing this year, the 
subcommittee chairman asked the USDA witnesses if their budget was 
based in any way on an assumption that there would be a closure of 
Agriculture Department offices. The agency responded in the negative.
  And yet The Washington Post has now revealed in a September article 
that FSA had plans afoot to close 713 Farm Service Agencies around the 
country. When that was discovered, the Agriculture Department 
indicated, ``Oh, this was just a draft. It was just a draft.'' But in 
fact USDA had pulled all 50 State FSA directors into Washington to give 
them instructions about how to go about selecting which offices would 
be closed.
  So it seems to me that USDA was disingenuous in their response to the 
Congress of the United States and that any self-respecting Congress 
would pull that agency's chain until we get straight answers to 
straight questions.
  The second issue that this motion deals with is the question of 
whether or not Texas ought to be able to go off on its own, in 
violation of Federal law, by privatizing the administration of the food 
stamp program.
  In June of 2004, Texas asked USDA to approve their request to 
privatize the administration of that program. The USDA sent them 
numerous letters requesting information that would enable USDA to 
determine whether or not the plan that Texas was providing was rational 
or not and whether it was consistent with law or not; and Texas has, 
frankly, stiffed the agency.
  If you take a look at the letters sent by the agencies, you will see 
for instance that in a letter from USDA to Senator Harkin, USDA said: 
``We do not yet have enough information to ascertain whether or not 
Texas's proposal is in compliance with the act in regard to the 
certification of recipients.'' It also then went on to say: ``We are 
concerned with the State's aggressive schedule for rolling out this 
project, especially with regard to contingency planning.''
  In another letter from USDA to the Texas Health and Human Services 
Commission, USDA stated: ``FMS needs to have clear and coherent 
narrative explanations of the food stamp certification process that are 
grounded in the contract and its supporting documents.'' USDA then went 
on to tell Texas: ``We must ensure that your new system is in full 
compliance with food stamp rules, regulations, and policy and that 
service to our program clients is not compromised.''
  Nonetheless, despite that, the Texas State government has yet to 
respond and provide the kind of information that is needed by USDA if 
USDA is to consider approval of their plan.
  The problem with the Texas plan is that while recipients are 
guaranteed under the law that they will have an opportunity to have 
their eligibility determined by a State employee, in fact, what Texas 
is trying to do is to circumvent Federal law and allow eligibility to 
be determined by a private party. The problem with that is that if you 
have a public servant who denies you a right, you are entitled under 
the law and you have a somewhat more direct redress than you do if you 
have a private citizen working for a private company who has no long-
term commitment to the government and who can simply stiff the 
recipients and does

[[Page 23100]]

not have to answer questions from the government.
  The government is supposed to be active in protecting the rights of 
each and every individual citizen of this country. Texas is interposing 
itself to prevent that right from actually being delivered; and in the 
process, in my view, Texas is clearly in violation of the law because 
they have proceeded with a plan that has not yet been approved by USDA.
  Again, any self-respecting Congress, in defense of what is existing 
law, would pass this motion so that Texas cannot unilaterally obviate 
State law.
  Ms. DeLAURO. Mr. Speaker, I yield 8\1/2\ minutes to the gentleman 
from Texas (Mr. Doggett).
  Mr. DOGGETT. Mr. Speaker, I applaud the gentlewoman for her very 
important motion to instruct. It is a motion to instruct that is 
designed to prevent an ideological experiment being conducted on some 
of the most vulnerable people in our society. It is about what has gone 
wrong in Texas, but it is much more than that because we are about to 
have a very bad precedent established that will spread across this 
country affecting the old, the poor, the hungry, the victims of 
Katrina, and the victims who are left behind.
  As all the Nation saw in the disaster that was the Federal response 
to Katrina, a hurricane is not the only time that working poor people 
in this country get left behind. The Texas experiment on poor people 
suggests that the answer to food security that food stamps provide is 
to close one out of every four offices that people go to to assess 
their food stamp needs, to fire a significant number of public 
employees who have expertise in this area, and to suggest to old and 
poor and hungry people that what they need to do instead of turning to 
a public servant is to log on the Internet.
  Yes, that is actually what the State of Texas is suggesting. And they 
offer to these poor people, not all of whom are literate in English or 
Spanish much less literate in the language of e-commerce, they offer 
them an alternative, which is the one that so many American families 
have faced, to dial in and be put on hold, much as the victims of 
Katrina were put on hold. You punch in a number and then you get 
referred to another number and you get to wait and wait and wait; and 
maybe eventually this company, Accenture, which chose to establish its 
base not in America but in Bermuda so it could dodge as much of its tax 
responsibility as it possibly could, that this company will substitute 
for a face-to-face evaluation.
  I represent the poorest county in the United States, Starr County, 
Texas, the poorest statistical metropolitan area, McAllen-Mission; and 
a lot of people along the way through the Mesquite trees up to Austin, 
Texans, who depend on food stamps for enough nourishment to get their 
kids to school, or to be able to survive as a senior. These folks are 
going to be directly affected.
  Currently, they are able to go in, and certainly along the border 
area if they feel more comfortable in Spanish, to talk face-to-face 
with someone who has expertise in this area, to talk with them and have 
that experienced public servant assess what their needs are and ensure 
that taxpayers are protected, and that there is not fraud, and ensure 
that their needs are fully satisfied.
  Now those folks in Hebbronville, San Diego, George West, and Lockhart 
are being told go to the Internet or go to some long-distance number 
because you will no longer be able to assess your needs on the local 
level. And in McAllen, Mission, and Austin, staff will be cut by 50 
percent.
  That is why, Mr. Speaker, I have been joined by 10 of my Texas 
colleagues in questioning this scheme and raising questions to the U.S. 
Department of Agriculture. And I will provide for the Record a report 
from the Center on Public Policy Priorities in Austin, an excellent 
report, under its director, Judge F. Scott McCown, and with the able 
participation of Celia C. Hagert, analyzing this, as well as an 
editorial that is on point in today's Houston Chronicle.

              [From the Houston Chronicle, Oct. 19, 2005]

                            An Untested Plan

       Texas Health and Human Services officials continue to 
     discuss with their federal counterparts at the Department of 
     Agriculture an unprecedented billion dollar welfare 
     privatization contract. It delegates certification and 
     enrollment of recipients for programs including food stamps, 
     Medicaid and the Children's Health Insurance Program known as 
     CHIP to a private firm, Accenture LLP.
       There are a number of troubling features in this deal that 
     justify delaying its implementation while it is tested on a 
     small scale around the state.
       The pact allows Accenture to set up a handful of calling 
     centers in Texas where operators would help applicants 
     navigate the federal and state aid bureaucracy. Meanwhile, 
     Texas Health and Human Services will lay off thousands of 
     food stamp workers and close more than a quarter of state-run 
     eligibility offices around the state. In their place, 
     Accenture plans to hire staff at low hourly rates while 
     depending on community organizations for volunteers to screen 
     applicants, fill out Web-based forms and drive clients to the 
     remaining offices for certification.
       Six Texas Democratic members of Congress have written Eric 
     Bost, U.S. undersecretary for food, nutrition and consumer 
     services, to express concerns. They point out that closing 
     state offices would require longer travel distances for 
     clients, primarily the elderly, children and the working 
     poor, many of whom do not speak English. They charge that the 
     expectation of a million hours of volunteer service to make 
     the plan work is unrealistic and ``would place an 
     unacceptable and perhaps impossible burden on these 
     organizations, many of whom are volunteer-run themselves.''
       According to the lawmakers, including Chet Edwards of Waco, 
     Eddie Bernice Johnson of Dallas, and Lloyd Doggett of Austin, 
     the current plan to launch the new system statewide in 11 
     months ``is a reckless timetable that does not allow time to 
     test or evaluate the new technology or its impact on food 
     stamp recipients.''
       The U.S. Senate already has banned such mass privatizations 
     of food stamp programs. Similar legislation is pending in the 
     House. Texas stands to lose federal food assistance funding 
     if it goes forward with the Accenture contract and the 
     privatization prohibition becomes law.
       The issue of conflict of interest by state officials in the 
     awarding of the contract has been raised in the past year in 
     Houston Chronicle reports. The HHS chief information officer 
     involved in pre-award negotiations was a former employee of a 
     firm partnering with Accenture, and the former HHS deputy 
     commissioner who helped develop the bidding procedures 
     subsequently went to work for Accenture. IBM, which also 
     sought the contract, has sued the state agency alleging bias 
     in the awarding of the pact.
       The Austin-based Center for Public Policy Priorities is 
     urging Texas lawmakers to support a pilot program to test the 
     Accenture system before putting it into effect statewide. As 
     staffer Celia Hagert points out, the issue involves access to 
     life supporting benefits for the most vulnerable Texans and 
     is particularly important for Harris County where 13 percent 
     of Texas food stamp recipients reside.
       There are plenty of unanswered questions about the awarding 
     of the Accenture contract and its feasibility to justify a 
     delay in implementing this radical revamping of the way Texas 
     administers social services. Nothing is put at risk by 
     testing the company's ability to adequately fulfill its 
     contract on a small scale. There's plenty to be lost in 
     liquidating a state-run system that has worked well in the 
     past and in potentially imperiling the health and welfare of 
     tens of thousands of people.
                                  ____

                                    Congress of the United States,


                                     House of Representatives,

                                Washington, DC, September 2, 2005.
     Re Texas's misguided plan to privatize the eligibility 
         determination process for the Food Stamp Program.

     Eric M. Bost,
     Under Secretary for Food, Nutrition, and Consumer Services, 
         Department of Agriculture, Alexandria, VA.
       Dear Secretary Bost: We are writing to express our deep 
     concerns about the State of Texas's efforts to privatize the 
     eligibility determination process for the Food Stamp Program. 
     As Members of Congress from Texas, we are apprehensive about 
     the impact the State's proposal could have on low-income 
     Texans who rely on this assistance, as well as the precedent 
     this effort sets for such practices to be adopted throughout 
     the Nation.
       Texas proposes to replace half of the State's eligibility 
     workers with privately contracted employees at four call 
     centers. The State would close 99 of its 380 eligibility 
     offices, which would mean longer travel distances for many 
     clients, most of whom would still be required to go to an 
     office to complete their application and be finger-imaged. 
     The State has called on community- and faith-based 
     organizations to donate over one million volunteer hours to 
     assist clients in navigating the more automated system to 
     make up for reductions in the State workforce. This would 
     place an unacceptable and

[[Page 23101]]

     perhaps impossible burden on these organizations, many of 
     which are volunteer-run themselves.
       We believe that privatizing the Food Stamp Program offers 
     little advantage and may put our most vulnerable citizens at 
     risk. We are deeply concerned about the impact the proposal 
     could have on hard-to-reach populations, in particular 
     children, people with disabilities, and seniors seeking food 
     assistance who may have trouble with the more automated 
     approach to enrollment.
       No state has ever privatized the determination of 
     eligibility for Food Stamps, and the wisdom of abandoning the 
     collective knowledge and experience of so my current 
     eligibility workers is uncertain at best. It is impossible to 
     estimate the number of eligible persons likely to lose Food 
     Stamp benefits as they lose access to local offices and face-
     to-face interviews. Therefore, we are very concerned about 
     the enormous consequences of this proposal. There are still 
     many unanswered questions about the impact of such an 
     approach on the Food Stamp program.
       We know of no plan to evaluate this new approach even 
     though the State has already signed a five-year contract that 
     calls for an 11-month statewide rollout. We believe this is a 
     reckless timetable that does not allow enough time to test or 
     evaluate the new technology or its impact on Food Stamp 
     recipients. A more thoughtful approach would be to test the 
     system in one area for 12 months, followed by an independent 
     evaluation. Since the contract was signed before the Food and 
     Nutrition Service reviewed and granted approval for the plan, 
     we urge you to adopt this more thoughtful approach as a 
     condition of continuing receipt of federal funds.
       We urge you to require the State to submit a request for a 
     waiver of the Food Stamp law related to merit system 
     employees conducting eligibility determinations. Should the 
     United States Department of Agriculture decide to approve 
     such a waiver, we urge you, at a minimum, to require Texas to 
     pilot test the new system in a limited geographic environment 
     for at least 12 months and to engage an independent entity to 
     produce a formal evaluation of the pilot program before the 
     program is permitted to expand. The geographic areas selected 
     should be representative of Texas's diverse ethnic and 
     linguistic population, and should encompass rural areas to 
     determine the challenges rural residents will face in a 
     system with such drastically reduced local services.
       Should you decide to grant such a waiver, we request that 
     you not do so before a detailed background briefing for our 
     offices and a public hearing before Congress. The public 
     needs to understand the implications of privatizing such a 
     critical and basic part of the Food Stamp Programs.
       We appreciate your attention to this important matter and 
     request that you contact us regarding the actions you plan to 
     take in this matter. Should you have any questions or 
     concerns regarding this issue, please do not hesitate to 
     contact us.
       Sincerely,
         Hon. Lloyd Doggett, Hon. Henry Cuellar, Hon. Ruben 
           Hinojosa, Hon. Sheila Jackson Lee, Hon. Al Green, Hon 
           Silvestre Reyes, Hon. Eddie Bernice Johnson, Hon. 
           Charles Gonzalez, Hon. Chet Edwards, Hon. Solomon 
           Ortiz, Hon. Gene Green.
                                  ____


                  [From the Policy Page, July 7, 2005]

                    HHSC Awards Call Center Contract

       On June 30, the Health and Human Services Commission 
     announced a 5-year, $899 million contract with Accenture, LLP 
     to revamp and take over operation of the state's eligibility 
     and enrollment systems for Medicaid, CHIP, Food Stamps, and 
     TANF cash assistance. The contract includes maintenance of 
     TIERS (the computer system that will support eligibility 
     determination) and an enrollment broker program for Medicaid 
     managed care and CHIP clients. The contract is the latest 
     development in the state's plans to move to a more automated 
     system for enrolling people in these benefits and will lead 
     to the use of four call centers and an Internet application, 
     with fewer eligibility staff and local offices. Many 
     important details about the contract and the new system have 
     not been released yet, including the location of office 
     closures, whether necessary federal approvals have been 
     granted, and the timeline for employee lay-offs and call 
     center implementation. This Policy Page shares what we know 
     so far about these latest developments in the state's plans 
     to use private call centers to enroll people in public 
     benefits.
       Nuts and Bolts: Four call centers will be established to 
     help people apply for and recertify for public benefits. 
     Staffed primarily by Accenture employees, the call centers 
     will be open from 8 a.m. to 8 p.m., Monday through Friday, 
     with the ability for callers to leave a recorded message 
     after hours. The 2-1-1 system, the state's information and 
     referral network for social services, will be the portal to 
     the call centers. One call center will be located in Austin, 
     where the CHIP call center is now (this call center's duties 
     will be folded into the new call center). The location of the 
     other three has not been announced, although San Antonio, 
     Tyler, and Odessa are rumored to be candidates.
       In the new system people will be able to apply for benefits 
     over the Internet or via a call center, as well as to check 
     the status of their application through an automated phone 
     system. Some clients will still be required to appear in 
     person at a local office to complete their application. HHSC 
     staff have said previously that only those clients with a 
     finger imaging requirement (the majority of the 900,000 
     households on Food Stamps) will have to go to a local office. 
     In addition, clients who request an in-person interview with 
     a caseworker will be granted one. Emergency requests for Food 
     Stamps (state law requires benefits to be delivered within 24 
     hours) are expected to be processed at local offices, rather 
     than through the call center. The local workforce centers 
     that assist HHSC clients with employment services 
     (administered by the Texas Workforce Commission through a 
     system of locally run regional workforce development boards) 
     will still provide these services and monitor whether clients 
     are complying with program work requirements.
       One hundred (100) offices will be closed, leaving 281 open. 
     HHSC had originally proposed closing 217 offices. An 
     announcement about office closures is expected this month.
       Role of Community-Based Organizations: When the state's 
     plans to use call centers were first announced in March 2004, 
     HHSC proposed using 600 volunteers and relying on over one 
     million volunteer hours per year from nonprofit and faith-
     based organizations, prompting an outcry from nonprofits 
     about their inability to take on this responsibility without 
     compensation.
       Savings: With the contract announcement, HHSC also issued a 
     one-page summary of its cost comparison of the estimated 
     savings possible through a state-operated integrated 
     eligibility system versus a contracted system. HB 2292, the 
     2003 law that directed the state to evaluate the cost-
     effectiveness of using call centers, also required HHSC to 
     determine whether the state or a private company could offer 
     the greatest savings. HHSC's analysis claims that the 
     contracted system offers the state 8.6% more in savings, or 
     roughly $210 million over five years. The cost comparison 
     attributes 1.5% of these additional savings to the difference 
     in the cost of employee benefits under a contracted system. 
     The source of the remaining additional savings is not 
     identified in the summary.
       The savings identified HHSC last week when the contract was 
     announced are higher than originally projected in the March 
     2004 business case, which claimed $389 million in savings. At 
     the same time, the total number of staff proposed for the new 
     system has risen from 3,377 (proposed in March 2004) to 
     5,398. There are other inconsistencies between last year's 
     business case analysis and the documents HHSC released last 
     week when the contract was announced, including differences 
     in the ``baseline'' budget (the cost if we stuck with the 
     current system) projections for 2006-2010. We anticipate HHSC 
     will release information shortly to clarify these 
     differences.
       Staff Reductions: According to an HHSC presentation to 
     eligibility staff last month, the total number of staff in 
     the new system--including public and private employees--will 
     drop from 5,824 current employees (as of June 1, 2005) to 
     5,398. The schedule for laying off state workers and 
     achieving the overall reduction in force has not been 
     announced. Out of the 5,398 remaining staff, 2,500 jobs will 
     be held private call center employees, which means the same 
     number of state staff will lose their jobs (HHSC is committed 
     to finding these employees different jobs within the HHS 
     system; Accenture also has indicated a hiring preference at 
     the call centers for former state workers). In addition to 
     the private sector employees, there will be 2,898 state 
     staff: 298 will be assigned to the call centers, 1,800 to the 
     remaining field offices, 600 outstationed at hospitals and 
     clinics, and 200 assigned to traveling ``SWAT'' teams that 
     will respond to fluctuations in staffing needs throughout the 
     state.
       The total number of workers in the new system will be 37% 
     higher than originally projected in HHSC's March 2004 cost-
     effectiveness study, which proposed staffing the new system 
     with only 3,377 employees.
       Although the proposed staffing levels are far higher than 
     originally anticipated, the number may still be inadequate to 
     deal with the growing workload in the system, even if the 
     improvements anticipated from better technology and a more 
     automated enrollment process are actually realized. Staff 
     reductions over the last eight years have caused disruptions 
     in services to clients and breaches in customer service, 
     resulting in lawsuits. These cuts were made despite growing 
     caseloads and workload and have badly damaged the foundation 
     for the current eligibility system. Inadequate resources have 
     been compounded by complicated eligibility rules that vary 
     across programs, a hard-to-serve clientele, and a constantly 
     changing policy environment. All told, the proposed 
     renovation faces a great deal of major repairs. While the new 
     system may resolve some of these shortcomings, no system, no 
     matter how efficient or modern, can make up for shortages in 
     the workforce.
       Timeline: The first call center is expected to begin 
     operations in Austin in November 2005, with remaining call 
     center operations and system changes phased in beginning in

[[Page 23102]]

     January 2006. The statewide roll-out is estimated to be 
     complete by the end of 2006. This l4-month timeline may not 
     allow adequate time to test the new technology needed to 
     support the system or to assess clients' ability to grapple 
     with a more automated approach to enrollment. Although 
     pressure from the legislature--the final state budget for 
     2006-2007 assumed a reduction of more than 4,000 HHSC 
     eligibility staff--may be driving such an aggressive 
     timeline, a slower, more rational approach to such drastic 
     changes would produce a better system in the long run while 
     mitigating the risks of going too fast.
       The Pros and Cons of Privatization: CPPP acknowledges that 
     private companies may offer innovations and savings the state 
     could not achieve on its own. However, although the 
     additiona1 15-year savings of $210 million achievable through 
     privatization (versus a state-run, revamped system) sounds 
     impressive, much of these projected additional savings are 
     likely the result of reductions in salary, health benefits, 
     and pension plans. To make room for these savings, thousands 
     of well-paying state jobs with family-supporting health, 
     vacation, and retirement benefits will be replaced with 
     lower-paying private sector jobs with fewer benefits. Most 
     notably, according to HHSC's presentation to eligibility 
     staff, Accenture will not contribute to dependent health 
     benefits such as the state does for its employees, opting 
     instead for a flexible spending account option that allows 
     employees to set aside their own pre-tax income to pay for 
     dependent health premiums and other out-of-pocket medical 
     costs. The loss of employer-sponsored dependent health 
     coverage may lead to an increase in need for publicly funded 
     health insurance--increasing these costs for the state--or 
     more uncompensated care that will be borne by local 
     governments and taxpayers. With privatization also comes 
     increased risk, which may outweigh the savings associated 
     with outsourcing.
       Other Issues and Concerns: It is also unclear whether HHSC 
     has received the necessary approvals from the federal 
     agencies that administer these programs and share the cost of 
     the benefits they provide. These agencies will have to 
     approve the cost-reimbursement methodology in the contract, 
     the allocation of costs to the federal agencies that 
     administer these programs, and the decision to privatize the 
     eligibility system, which could require a waiver of federal 
     law that HHSC has not requested. Both the Federal Food Stamp 
     and Medicaid statutes require public employees to determine 
     eligibility for these benefits.

                              {time}  1345

  Mr. Speaker, the idea of ensuring as much efficiency in this program, 
as will all, is one that I applaud. But the way that the State of Texas 
has gone about it is very troubling. Indeed, today's vote on this 
motion to instruct is a vote for food security, a vote for health 
security, and a vote against cronyism.
  As noted in a series of reports that the Houston Chronicle undertook 
on this proposal, and in today's editorial, the former Texas Health and 
Human Services Deputy Commissioner who helped develop the bidding 
procedures to close down these offices and substitute the Internet and 
Accenture's telephone lines to who knows where then went to work for 
Accenture, surprisingly enough. It sounds a lot like the cronyism in 
Washington we have been hearing so much about lately. The situation was 
so bad that IBM, International Business Machines, which also bid on 
this contract, after this person set the procedures and then went off 
to work for the people who were awarded the contract, has sued the 
State of Texas alleging bias in the award.
  My concern is that we not shift to an impersonal system that does not 
meet the needs of poor people in our State and at the same time, as the 
Houston Chronicle points out today, it is ``an unprecedented billion-
dollar privatization contract,'' that the taxpayers do not end up 
losing even as the most vulnerable people in our society lose.
  This privatization scheme relies not on experienced public servants, 
but it will shift more of the burden to community volunteers, to 
churches, and to local nonprofits. And while it is great to have those 
people and organizations as part of our social safety network, they 
cannot substitute for the experienced backup, as we found in the 
Hurricane Katrina disaster, of a public safety net. That is what this 
motion to instruct preserves.
  Mr. Speaker, if you do not have access to the Internet, do not want 
to be put on hold indefinitely to some unknown line across the world to 
wherever Accenture locates its phone center, the only other alternative 
is to get in the car and drive. We all know if we are going to have to 
drive with all of the nearby offices closed to one far away, that also 
because of the policies of this administration the price of gasoline 
has gone out the roof.
  I think as a practical matter, putting this scheme on hold, it is 
clear that the administration, the response that I got only within the 
last few days from an Under Secretary of Agriculture, indicating that 
there were concerns with the speedy nature of the way the State had 
gone about this proposal, concerned the Department of Agriculture. They 
raised a number of questions. I think this is consistent with their 
concerns to not rush into this.
  In the event we are to move to such an insensitive system, it ought 
to at least be market tested. No business--and we are always hearing 
about the importance of running government as a business--would go off 
with this kind of scheme if it were introducing a new product without 
at least testing it. That is what we have been calling for. Before you 
do an experiment on all of the poor and hungry people of Texas that 
could spread across the country, at least do some limited testing on 
that proposal and see if it works or it creates more cost to the 
taxpayer and more pain to the hungry.
  I believe that the editorial in today's Houston Chronicle sums up the 
problems in talking about the difficulties of relying on a handful of 
calling centers, closing more than a fourth of the State-run 
eligibility offices, not allowing time to test or evaluate the new 
technology or its actual impact on food stamp recipients, the conflict 
of interest by State officials in awarding the contract, and the call 
of the Center for Public Policy Priorities to support a pilot program. 
I also find it indeed ironic, and I agree with the chairman on the 
importance of not prematurely closing these Farm Service Agencies 
because this is what this motion to instruct also is about. I represent 
a number of those rural producer areas. If we are not going to close 
those offices, why is it again that the poor people who are applying 
for food stamps, that their offices get closed. That is what will 
happen if this motion to instruct which has been ably worded by the 
gentlewoman from Connecticut (Ms. DeLauro) is not adopted.
  I hope my colleagues in a bipartisan way will join with the 
expressions of concern from the U.S. Department of Agriculture and put 
a stop to this until it is market tested and before this faulty 
experiment is foisted off on both the taxpayer and the hungry people of 
America.
  Mr. BONILLA. Mr. Speaker, I yield back the balance of my time.
  Ms. DeLAURO. Mr. Speaker, I yield myself the balance of my time.
  Mr. Speaker, I want to say to the gentleman from Texas (Mr. Bonilla), 
his opening comments and his conversations with USDA with regard to the 
Farm Service Agency field offices, it sounds like we had very, very 
similar conversations. I think we both agree, even in light of 
yesterday's letter, it is good to trust but it is also good to verify.
  With regard to the second portion of the motion to instruct with 
which the chairman has concerns, I would say that the Food Stamp 
Program is a Federal program. Fifty percent of the administrative costs 
are Federal, 100 percent of the benefits are Federal. In our bill there 
is $40 billion that we are about to appropriate for this program; and, 
in fact, I think we cannot willy-nilly make changes in the program 
without coming back to the Federal Government for waivers as such.
  In closing, let me say this motion is the right thing to do. I would 
repeat it is twofold, codifying USDA's decision yesterday to keep open 
more than 700 FSA offices, returning jurisdiction of the issue to the 
hands of Congress where it belongs, and ensuring that our food stamp 
programs are not privatized.
  With respect to FSA, I would repeat this motion is needed because 
even though the FSA Tomorrow Plan has been shelved for the time being, 
we are already hearing reports that USDA is contemplating reviving this 
plan, perhaps under a new name, and Congress

[[Page 23103]]

 needs to ensure that the people impacted most directly by this plan, 
our farmers, have a say in how that modernization plan is carried out.
  On the latter point with respect to food stamps, I would repeat, this 
is not just a Texas issue. The Federal Government and taxpayers all 
over the country pay half the cost of running the Food Stamp Program. 
That means that we, the Congress, have an obligation to ensure that the 
program is run effectively, efficiently and in compliance with the law.
  The Food Stamp Program is operating with the lowest error rate it has 
ever had, the results of years of work by USDA, State and local 
employees, and bipartisan support from this institution. We do not want 
to see a repeat of what happened in Colorado where the State spent 
millions of Federal funds on a computer system that not only did not 
work, but prevented thousands of needy people from getting government 
benefits like food assistance and health insurance. Particularly with 
many believing the State of Texas is counting on the White House to 
override any efforts by USDA officials to rein in this plan, we know 
Congress must address this issue and do it immediately.
  In all these instances, we are reminded of the same thing, that 
government has an obligation to people, whether it is ensuring our most 
needy citizens receive food stamps or our farmers receive the services 
they need to keep planting, harvesting, and selling crops. This is 
about the Congress, this institution, its role in ensuring that the 
American people tackle their toughest challenges together. That is our 
responsibility to the American people, and fulfilling that obligation 
is what this motion would accomplish.
  Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Terry). Without objection, the previous 
question is ordered on the motion to instruct.
  There was no objection.
  The SPEAKER pro tempore. The question is on the motion to instruct 
offered by the gentlewoman from Connecticut (Ms. DeLauro).
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Ms. DeLAURO. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further 
proceedings on this question will be postponed.

                          ____________________