[House Report 105-178]
[From the U.S. Government Publishing Office]



105th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 1st Session                                                    105-178
_______________________________________________________________________


 
   AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND 
               RELATED AGENCIES APPROPRIATIONS BILL, 1998

                                _______
                                

 July 14, 1997.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

_______________________________________________________________________


    Mr. Skeen, from the Committee on Appropriations, submitted the 
                               following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                        [To accompany H.R. 2160]

    The Committee on Appropriations submits the following 
report in explanation of the accompanying bill making 
appropriations for Agriculture, Rural Development, Food and 
Drug Administration, and Related Agencies for fiscal year 1998.

                                                        SUMMARY OF ESTIMATES AND RECOMMENDATIONS                                                        
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                    FY 1998 recommendation compared with
                                                                   FY 1997           FY 1998           FY 1998     -------------------------------------
                                                                appropriation       estimates      recommendation        FY 1997                        
                                                                                                                      appropriation    FY 1998 estimates
--------------------------------------------------------------------------------------------------------------------------------------------------------
Title I--Agricultural Programs..............................    $7,718,014,000    $6,943,651,000    $6,874,933,000      -$843,081,000       -$68,718,000
Title II--Conservation Programs.............................       770,554,000       821,995,000       759,431,000        -11,123,000        -62,564,000
Title III--Rural Economic and Community Development Programs     2,003,756,000     2,180,559,000     2,041,168,000        +37,412,000       -139,391,000
Title IV--Domestic Food Programs............................    40,490,965,000    39,822,970,000    37,218,192,000     -3,272,773,000     -2,604,778,000
Title V--Foreign Assistance and Related Programs............     1,593,194,000     1,645,070,000     1,719,429,000       +126,235,000        +74,359,000
Title VI--Related Agencies and FDA..........................       953,006,000       887,945,000       990,444,000        +37,438,000       +102,499,000
Title VII--Emergency Appropriations (P.L. 104-208)..........       360,000,000  ................  ................       -360,000,000  .................
                                                             -------------------------------------------------------------------------------------------
      Subtotal..............................................    53,889,489,000    52,302,190,000    49,603,597,000     -4,285,892,000     -2,698,593,000
      Scorekeeping adjustments..............................      -762,000,000       -17,546,000      -156,546,000       +605,454,000       -139,000,000
                                                             -------------------------------------------------------------------------------------------
      Total.................................................   $53,127,489,000   $52,284,644,000   $49,447,051,000    -$3,680,438,000    -$2,837,593,000
--------------------------------------------------------------------------------------------------------------------------------------------------------

    For discretionary programs the Committee provides 
$13,650,196,000, which is $599,317,000 more than the amount 
available in fiscal year 1997 and $424,043,000 less than the 
budget request.
    For mandatory programs, which account for over 70 percent 
of the bill, the Committee provides $35,796,855,000, a decrease 
of $4,279,755,000 below the amount available for fiscal year 
1997 and $2,413,550,000 below the budget request.

                              Introduction

    The programs funded in this legislation touch the lives of 
every American, every day. The Department of Agriculture 
administers nutrition and feeding programs for millions of 
Americans. USDA is also responsible for the safety of our meat 
and poultry supply.
    This bill provides funding for research to strengthen our 
Nation's food supply, to make American exports competitive in 
world markets, to improve human nutrition, and to help ensure 
food safety. Funds in this bill make it possible for less than 
two percent of the population to provide a wide variety of 
safe, nutritious, and affordable food for nearly 270 million 
Americans and many more people overseas.
    The rural development programs funded in this bill provide 
basic housing, safe water, and opportunities for economic 
growth in rural America. Conservation and environmental 
programs preserve lands and watersheds for use by future 
generations.
    In addition, this bill provides funding for the Food and 
Drug Administration which oversees the safety of an enormous 
range of food, drugs, and medical devices and the Commodity 
Futures Trading Commission which regulates an increasingly 
complex market in commodity trading.
    To establish priorities for funding for so many diverse and 
critical activities is never easy and the task will be more 
difficult as we continue with the effort to balance the budget. 
There are relatively few program increases in this bill: most 
of the accounts are at current levels of spending or decreased 
from the previous fiscal year.
    The Committee has carefully considered the funding requests 
from the Administration and has tried to allocate the fiscal 
year 1998 appropriation in the most responsible way possible. 
In doing so, the Committee expects the Administration to carry 
out the programs as efficiently as possible.
    Clause 2(l)(4) of rule XI of the Rules of the House of 
Representatives states that:

          Each report of a committee on a bill or joint 
        resolution of a public character, shall include a 
        statement citing the specific powers granted to the 
        Congress in the Constitution to enact the law proposed 
        by the bill or joint resolution.

    The Committee bases its authority to report this 
legislation from Clause 7 of Section 9 of Article I of the 
Constitution of the United States of America which states:

          No money shall be drawn from the Treasury but in 
        consequence of Appropriations made by law * * *

    Appropriations contained in this Act are made pursuant to 
this specific power granted by the Constitution.

                 government performance and results act

    The Committee considers the full and effective 
implementation of the Government Performance and Results Act, 
P.L. 103-62, to be a priority for all agencies of government.
    Starting with fiscal year 1999, the Results Act requires 
each agency to ``prepare an annual performance plan covering 
each program activity set forth in the budget of such agency.'' 
Specifically, for each program activity the agency is required 
to ``establish performance goals to define the level of 
performance to be achieved by a program activity'' and 
``performance indicators to be used in assessing the relevant 
outputs, service levels, and outcomes of each program 
activity.''
    The Committee takes this requirement of the Results Act 
very seriously and plans to carefully examine agency 
performance goals and measures during the appropriations 
process. As a result, starting with the fiscal year 1999 
appropriations cycle, the Committee will consider agency 
progress in articulating clear, definitive, and results-
oriented (outcome) goals and measures as it reviews requests 
for appropriations.
    The Committee suggests agencies examine their program 
activities in light of their strategic goals to determine 
whether any changes or realignments would facilitate a more 
accurate and informed presentation of budgetary information. 
Agencies are encouraged to consult with the Committee as they 
consider such revisions prior to finalizing any requests 
pursuant to 31 U.S.C. 1104. The Committee will consider any 
requests with a view toward ensuring that fiscal year 1999 and 
subsequent budget submissions display amounts requested against 
program activity structures for which annual performance goals 
and measures have been established.

                     TITLE I--AGRICULTURAL PROGRAMS

                 Production, Processing, and Marketing

                        Office of The Secretary

1997 appropriation......................................      $2,836,000
1998 budget estimate....................................       2,872,000
Provided in the bill....................................       2,836,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................         -36,000

    The Secretary of Agriculture, assisted by the Deputy 
Secretary, Under Secretaries and Assistant Secretaries, Chief 
Information Officer, Chief Financial Officer, and members of 
their immediate staffs, directs and coordinates the work of the 
Department. This includes developing policy, maintaining 
relationships with agricultural organizations and others in the 
development of farm programs, and maintaining liaison with the 
Executive Office of the President and Members of Congress on 
all matters pertaining to agricultural policy.
    The general authority of the Secretary to supervise and 
control the work of the Department is contained in the Organic 
Act 1944 (7 U.S.C. 2201-2202). The delegation of regulatory 
functions to Department employees and authorization of 
appropriations to carry out these functions is contained in 7 
U.S.C. 450c-450g.

                          committee provisions

    For the Office of the Secretary, the Committee provides an 
appropriation of $2,836,000, the same as the amount available 
for fiscal year 1997 and a decrease of $36,000 below the budget 
request.
    The Secretary shall report to the Appropriations Committee 
of the House and the Appropriations Committee of the Senate 
biannually during fiscal year 1998 as to whether the prices of 
raw cane and beet sugar are sufficient to prevent forfeitures 
and that the stock/use ratio is sufficient to ensure stable and 
adequate supplies to consumers and refiners, with consideration 
of its impact on growers, producers, processors, and users. 
This report language worked well for fiscal year 1997.
    The Committee has supported Conservation Reserve Program 
(CRP) in the past. However, the Committee recognizes apparent 
discrepancies exist as a result of the 15th CRP sign-up in 
Washington State. Furthermore, the Committee believes the 
Conservation Reserve Program rules will result in a significant 
loss of environmental benefit to the Pacific Northwest. 
Therefore, the Inspector General shall perform a comprehensive 
investigation of the 15th CRP sign-up in Washington State to 
determine why the state received a 60% lower acceptance rate 
than bordering states. The Inspector General shall report to 
Congress no later than November 15, 1997.
    The bill contains a general provision prohibiting any 
appropriated funds to be used for the position of Western 
Director and Special Assistant to the Secretary within the 
Office of the Secretary. This is a new position, established in 
1997 by the Secretary. The Department intends to use $136,500 
from funds appropriated for rural development to pay 50 percent 
of the cost of this position. The Committee does not believe 
that this position advances any interest in the rural 
development mission area. The Committee also notes that there 
are rural development directors in each state and more than 
7,300 rural development personnel in Washington, D.C. and the 
states who already represent the Secretary in working with 
state, local, and other Federal government agencies and the 
private sector.
    The Committee further notes that the Department plans to 
reduce the rural housing work force by approximately 350 
positions in the next fiscal year and believes the 
establishment of new bureaucracy within the Department at a 
time of personnel reduction is not justified.
    The Committee has included a general provision which limits 
expenses related to advisory committees, panels, task forces, 
and commissions to not more than $1,000,000. This provision is 
intended to cover the activities of all advisory committee, 
panels, task forces, and commissions including any FACA related 
activities. The only exceptions are for panels used to comply 
with negotiated rule makings and panels used to evaluate 
competitively awarded grants.
    In fiscal year 1997, the Committee included language 
designed to limit the personnel detailed to sub-Cabinet 
offices. It had come to the Committee's attention that while 
each office had requested and received a specific appropriation 
that, in fact, many more personnel and funds were being used to 
support sub-Cabinet offices. Each Under or Assistant Secretary 
office should justify its expenditures and staffing the same as 
agencies must. It became apparent during hearings this year 
that Under and Assistant Secretary offices continue to violate 
the spirit of the individual appropriations for these offices. 
Financial shell games have been devised to deflect salaries of 
agency personnel for the continuation of the very same function 
detailees have been performing. The Committee includes language 
again this year which prohibits details for more than 30 days. 
The Committee has also appropriately reduced the fiscal year 
1998 appropriations for those agencies contributing funding for 
the purposes of supporting Under and Assistant Secretary 
offices.

                          Executive Operations

    Executive Operations was established as a result of the 
reorganization of the Department to provide a support team for 
USDA policy officials and selected department-wide services. 
Activities under Executive Operations include the Office of the 
Chief Economist, the National Appeals Division, the Office of 
Budget and Program Analysis, and the Office of the Chief 
Information Officer.

                     Office of the Chief Economist

1997 appropriation......................................      $4,231,000
1998 budget estimate....................................       5,308,000
Provided in the bill....................................       4,844,000
Comparison:
    1997 appropriation..................................        +613,000
    1998 budget estimate................................        -464,000

    The Office of the Chief Economist advises the Secretary of 
Agriculture on the economic implications of Department policies 
and programs. The Office serves as the single focal point for 
the Nation's economic intelligence and analysis, risk 
assessment, and cost-benefit analysis related to domestic and 
international food and agriculture, and is responsible for 
coordination and review of all commodity and aggregate 
agricultural and food-related data used to develop outlook and 
situation material within the Department.

                          committee provisions

    For the Office of the Chief Economist, the Committee 
provides an appropriation of $4,844,000, an increase of 
$613,000 above the amount available for fiscal year 1997 and a 
decrease of $464,000 below the budget request. The increase 
reflects the $175,000 that was transferred to this office in 
fiscal year 1997 from other USDA agencies to support 
sustainable development activities. The Committee has also 
included an additional $438,000 to enhance the Department's 
weather information activities.

           commission on 21st century production agriculture

1997 appropriation......................................................
1998 budget estimate....................................      $1,100,000
Provided in the bill....................................................
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................      -1,100,000

    The Federal Agriculture Improvement and Reform (FAIR) Act 
of 1996 authorized the Commission on 21st Century Production 
Agriculture to conduct a comprehensive review and assessment of 
the success of production flexibility contracts in supporting 
the viability of U.S. farming and a review of the future of 
production agriculture and the appropriate role of the Federal 
government.

                          Committee Provisions

    The Committee does not concur with the budget request for a 
separate appropriation for the Commission on 21st Century 
Production Agriculture. The Committee has included a general 
provision which limits the total amount spent on all advisory 
committees, task forces, panels, and commissions of the 
Department to not more than $1,000,000. The Committee does not 
specify how this funding should be spent, but rather allows the 
Secretary to prioritize and decide which ones to fund and at 
what funding levels.

                       National Appeals Division

1997 appropriation......................................     $11,718,000
1998 budget estimate....................................      13,359,000
Provided in the bill....................................      11,718,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................      -1,641,000

    The National Appeals Division conducts administrative 
hearings and reviews adverse program decisions made by the Farm 
Service Agency, the Natural Resources Conservation Service, and 
the Rural Housing Service.

                          Committee Provisions

    For the National Appeals Division, the Committee provides 
an appropriation of $11,718,000, the same as the amount 
available for fiscal year 1997 and a decrease of $1,641,000 
below the budget request.

                 Office of Budget and Program Analysis

1997 appropriation......................................      $5,986,000
1998 budget estimate....................................       5,918,000
Provided in the bill....................................       5,986,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................         +68,000

    The Office of Budget and Program Analysis provides 
direction and administration of the Department's budgetary 
functions including development, presentation, and execution of 
the budget; reviews program and legislative proposals for 
program, budget, and related implications; analyzes program and 
resource issues and alternatives, and prepares summaries of 
pertinent data to aid the Secretary and departmental policy 
officials and agency program managers in the decision-making 
process; and provides department-wide coordination for and 
participation in the presentation of budget related matters to 
the Committees of the Congress, the media, and interested 
public. The Office also provides department-wide coordination 
of the preparation and processing of regulations and 
legislative programs and reports.

                          COMMITTEE PROVISIONS

    For the Office of Budget and Program Analysis, the 
Committee provides an appropriation of $5,986,000, the same as 
the amount available for fiscal year 1997 and an increase of 
$68,000 above the budget request.

                office of the chief information officer

1997 appropriation......................................  \1\ $4,498,000
1998 budget estimate....................................   \2\ 4,828,000
Provided in the bill....................................       4,773,000
Comparison:
    1997 appropriation..................................        +275,000
    1998 budget estimate................................         -55,000

\1\ $4,498,000 transferred from Departmental Administration.
\2\ The official budget request was $275,000.

    The Clinger-Cohen Act of 1996 required the establishment of 
a Chief Information Officer for major Federal agencies. 
Pursuant to this Act, the Office of the Chief Information 
Officer was established in August 1996, to provide policy 
guidance, leadership, coordination, and direction to the 
Department's information management and information technology 
investment activities in support of USDA program delivery. The 
Office provides long-range planning guidance, implements 
measures to ensure that technology investments are economical 
and effective, coordinates interagency Information Resources 
Management projects, and implements standards to promote 
information exchange and technical interoperability. Department 
level information resources management functions were 
transferred from Departmental Administration to this Office.

                          committee provisions

    For the Office of the Chief Information Officer, the 
Committee provides an appropriation of $4,773,000, a decrease 
of $55,000 below the budget request and an increase of $275,000 
above the amount available for fiscal year 1997.
    The budget request for fiscal year 1998 creates separate 
funding for the Office of the Chief Information Officer. This 
office has previously been funded under Departmental 
Administration.
    The bill also includes a general provision that none of the 
funds available to the Department of Agriculture may be used to 
acquire significant new information technology systems or 
upgrades without the approval of the Chief Information Officer 
and the concurrence of the Executive Information Technology 
Investment Review Board. The Committee expects the Secretary to 
redirect IRM resources as necessary to enable the Office of the 
CIO to carry out its responsibilities.

                 Office of the Chief Financial Officer

1997 appropriation......................................      $4,283,000
1998 budget estimate....................................       4,718,000
Provided in the bill....................................       4,283,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................        -435,000

    Under the Chief Financial Officers Act of 1990, the Chief 
Financial Officer is responsible for the continued direction 
and oversight of the Department's financial management 
operations and systems. The Office supports the Chief Financial 
Officer in carrying out the dual roles of the Chief Financial 
Management Policy Officer and the Chief Financial Management 
Advisor to the Secretary and mission area heads. The Office 
provides leadership, expertise, coordination, and evaluation in 
the development of Department and agency programs in financial 
management, accounting, travel, Federal assistance, and 
performance measurements. It is also responsible for the 
management and operation of the National Finance Center. The 
Office also provides budget, accounting, and fiscal services to 
the Office of the Secretary, departmental staff offices, Office 
of the Chief Information Officer, Office of Communications, and 
Executive Operations.

                          Committee Provisions

    For the Office of the Chief Financial Officer, the 
Committee provides an appropriation of $4,283,000, the same as 
the amount available for fiscal year 1997 and a decrease of 
$435,000 below the budget request.
    The Committee has repeated bill language that directs the 
Chief Financial Officer to continue to market actively the 
cross-servicing activities of the National Finance Center.

          Office of the Assistant Secretary for Administration

1997 appropriation......................................        $613,000
1998 budget estimate....................................         621,000
Provided in the bill....................................         613,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................          -8,000

    The Office of the Assistant Secretary for Administration 
directs and coordinates the work of the departmental staff in 
carrying out the laws enacted by the Congress relating to real 
and personal property management, personnel management, equal 
opportunity and civil rights programs, and other general 
administrative functions. Additionally, the Office of the 
Assistant Secretary for Administration is responsible for 
certain activities financed under the Department's Working 
Capital Fund (7 U.S.C. 2235).

                          committee provisions

    For the Office of the Assistant Secretary for 
Administration, the Committee provides an appropriation of 
$613,000, the same as the amount available for fiscal year 1997 
and a decrease of $8,000 below the budget request.

        Agriculture Buildings and Facilities and Rental Payments

1997 appropriation......................................    $144,053,000
1998 budget estimate....................................     131,085,000
Provided in the bill....................................     141,085,000
Comparison:
    1997 appropriation..................................      -2,968,000
    1998 budget estimate................................     +10,000,000

    Rental Payments.--Annual appropriations are made to 
agencies of the Federal government so that they can pay the 
General Services Administration (GSA) fees for rental of space 
and for related services.
    The budget estimates for rental payments are based on GSA's 
projection of what it will bill agencies in the budget year. 
The agencies have no influence or control over how GSA sets 
their rates. Rental payments paid by agencies go into a fund to 
be used for other real property management operations, such as 
rental of buildings, repairs and alterations, and acquisition 
of new facilities. The concept behind rental payments is that 
all agencies pay the market value of the space they occupy so 
that GSA will have the funds available to provide, in an 
efficient and coordinated way, for overall Federal space needs. 
However, in practice this concept means that agencies are 
paying prevailing commercial rental rates in order to subsidize 
the inflated cost of new construction and newly leased space 
and to cover the cost of vacant space in GSA's inventory.
    Building Operations and Maintenance.--On October 1, 1984, 
GSA delegated the operations and maintenance functions for the 
buildings in the D.C. complex to the Department. This activity 
provides departmental staff and support services to operate, 
maintain, and repair the buildings in the D.C. complex. Since 
1989, when the GSA delegation expired, USDA has been 
responsible for managing, operating, maintaining, repairing, 
and improving the headquarters complex, which encompasses 14.1 
acres of ground and four buildings containing approximately 
three million square feet of space occupied by approximately 
8,000 employees.
    Strategic Space Plan.--The Department's headquarters staff 
is presently housed in a four-building government-owned complex 
in downtown Washington, D.C. and in leased buildings in the 
metropolitan Washington area. In 1995, USDA initiated a plan to 
improve the delivery of USDA programs to the American people, 
including streamlining the USDA organization. A high priority 
goal in the Secretary's plan is to improve the operation and 
effectiveness of the USDA headquarters in Washington. To 
implement this goal, a strategy for efficient re-allocation of 
space to house the restructured headquarters agencies in modern 
and safe facilities has been proposed. This USDA Strategic 
Space Plan will correct serious problems USDA has faced in its 
facility program including the inefficiencies of operating out 
of scattered leased facilities and serious safety hazards which 
exist in the huge Agriculture South Building.

                          Committee Provisions

    For Agriculture Buildings and Facilities and Rental 
Payments to GSA, the Committee provides an appropriation of 
$141,085,000, a decrease of $2,968,000 below the amount 
available for fiscal year 1997 and an increase of $10,000,000 
above the budget request.
    Included in this amount is $98,600,000 for rental payments 
to GSA. The Committee includes language permitting the 
Secretary of Agriculture to transfer not more than five percent 
of this appropriation to or from another agency's 
appropriation. The Committee expects that such a transfer will 
be proposed only when a move into GSA space is vacated in favor 
of commercial space. This flexibility is provided to allow for 
incremental changes in the amount of GSA space and is not 
intended merely to finance changes in GSA billing.
    Also included in the total amount is an additional 
$10,000,000 above the budget request to accelerate the work 
that needs to be done to address the serious health and safety 
hazards which exist in the South Building.
    The new facility at Beltsville will be complete and ready 
for occupancy during fiscal year 1998. The Committee does not 
expect the Department to sign any new leases for the rental of 
space in the Washington D.C. area, but instead expects this 
facility to be fully utilized. Funding for relocation expenses 
are provided for moving to either the Headquarters complex or 
the Beltsville facility, not to new leased space. The Committee 
further expects GSA to reduce its billing to USDA to reflect 
any moves out of leased space and that any reductions in rental 
payments be used for additional renovation work of the South 
Building.

                       Hazardous Waste Management

1997 appropriation......................................     $15,700,000
1998 budget estimate....................................      25,000,000
Provided in the bill....................................      20,000,000
Comparison:
    1997 appropriation..................................      +4,300,000
    1998 budget estimate................................      -5,000,000

    Under the Comprehensive Environmental Response, 
Compensation, and Liability Act and the Resource Conservation 
and Recovery Act, the Department has the responsibility to meet 
the same standards regarding the storage and disposition of 
hazardous waste as private businesses. The Department is 
required to contain, clean up, monitor, and inspect for 
hazardous waste in areas covered by the Department or within 
departmental jurisdiction.

                          Committee Provisions

    For Hazardous Waste Management, the Committee provides an 
appropriation of $20,000,000, an increase of $4,300,000 above 
the amount available for fiscal year 1997 and a decrease of 
$5,000,000 below the budget request.
    The Committee notes that the budget request for Hazardous 
Waste Management includes nearly 5,000 abandoned mining sites 
among properties to be cleaned. The Committee suggests that the 
Department consider requesting funds for the cleanup of Forest 
Service properties from the Appropriations subcommittee with 
jurisdiction over that agency.

                      Departmental Administration

1997 appropriation...................................... \1\ $30,529,000
1998 budget estimate....................................  \2\ 25,258,000
Provided in the bill....................................      25,731,000
Comparison:
    1997 appropriation..................................      -4,798,000
    1998 budget estimate................................        +473,000

\1\ Includes $783,000 for the Office of Small and Disadvantaged Business 
Utilization and $4,498,000 transferred to the Office of the Chief 
Information Officer.
\2\ Does not include $795,000 for the Office of Small and Disadvantaged 
Business Utilization.

    Departmental Administration is comprised of activities that 
provide staff support to top policy officials and overall 
direction and coordination of the Department. These activities 
include department-wide programs for human resource management, 
management improvement, occupational safety and health 
management, real and personal property management, procurement, 
contracting, motor vehicle and aircraft management, supply 
management, civil rights and equal opportunity, emergency 
preparedness, small and disadvantaged business utilization, and 
the regulatory hearing and administrative proceedings conducted 
by the Administrative Law Judges, Judicial Officer, and Board 
of Contract Appeals.
    Departmental Administration is also responsible for 
representing USDA in the development of government-wide 
policies and initiatives; analyzing the impact of government-
wide trends and developing appropriate USDA principles, 
policies, and standards. In addition, Departmental 
Administration engages in strategic planning and evaluating 
programs to ensure Department-wide compliance with applicable 
laws, rules, and regulations pertaining to administrative 
matters for the Secretary and general officers of the 
Department.
    In fiscal year 1996, Departmental Administration 
reorganized its policy development and administrative 
operational activities. The reorganization significantly 
altered the alignment of functions and activities within 
Departmental Administration. The previous organization 
structure divided the Departmental Administration function into 
specific program offices, such as personnel, operations, and 
civil rights enforcement. The new organization structure 
divides the function into policy, program operations, and 
support for other offices, and is intended to be more focused 
and responsive to customer needs.
    The Office of Small and Disadvantaged Business Utilization 
oversees direction and implementation of Section 8 and 16 of 
the Small Business Act and oversees procurement to assure 
maximum participation of small and small disadvantaged 
businesses.

                          Committee Provisions

    For Departmental Administration, the Committee provides an 
appropriation of $25,731,000, a decrease of $4,798,000 below 
the amount available for fiscal year 1997 and an increase of 
$473,000 above the budget request. The fiscal year 1998 budget 
request reflects a transfer of $4,498,000 from Departmental 
Administration to the Office of the Chief Information Officer.
    The total includes funding for the Office of Small and 
Disadvantaged Business Utilization at the same amount available 
in fiscal year 1997.

     Office of the Assistant Secretary for Congressional Relations

1997 appropriation......................................      $3,668,000
1998 budget estimate....................................       3,714,000
Provided in the bill....................................       3,668,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................         -46,000

    The Office of the Assistant Secretary for Congressional 
Relations maintains liaison with the Congress and White House 
on legislative matters. It also provides for overall direction 
and coordination in the development and implementation of 
policies and procedures applicable to the Department's intra 
and inter-governmental relations.

                          Committee Provisions

    For the Office of the Assistant Secretary for Congressional 
Relations, the Committee provides an appropriation of 
$3,668,000, the same as the amount available for fiscal year 
1997 and a decrease of $46,000 below the budget request. The 
Committee includes language allowing the transfer of not less 
than $2,241,000 to agencies funded in this Act to maintain 
personnel at the agency level. The following table reflects the 
amounts provided by the Committee:

Headquarters Activities.......................................  $957,000
Intergovernmental Affairs.....................................   470,000
Agricultural Marketing Service................................   176,000
Agricultural Research Service.................................   129,000
Animal and Plant Health Inspection Service....................   101,000
Cooperative Research, Education, and Extension Service........   120,000
Farm Service Agency...........................................   355,000
Food and Consumer Service.....................................   270,000
Food Safety and Inspection Service............................   309,000
Foreign Agricultural Service..................................   188,000
Natural Resources Conservation Service........................   148,000
Rural Business-Cooperative Service............................    52,000
Rural Housing Service.........................................   251,000
Rural Utilities Service.......................................   142,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total...................................................

                                                              $3,668,000
    The Committee has learned that the office of Congressional 
Relations is billing agencies for ``other services.'' The 
Committee emphasizes language included in the bill stating that 
no other funds appropriated to the Department in this Act shall 
be available for support of activities of congressional 
relations. If the Office of the Assistant Secretary for 
Congressional Relations is branching out and performing 
services not related to congressional affairs, then the Office 
is directed to submit a description of these services and the 
amount it is charging agencies for these services to the 
Committee so it can adjust its appropriation accordingly.

                        Office of Communications

1997 appropriation......................................      $8,138,000
1998 budget estimate....................................       8,279,000
Provided in the bill....................................       8,138,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................        -141,000

    The Office of Communications provides direction, 
leadership, and coordination in the development and delivery of 
useful information through all media to the public on USDA 
programs. The Office serves as the liaison between the 
Department and the many associations and organizations 
representing America's food, fiber, and environmental 
interests.

                          committee provisions

    For the Office of Communications, the Committee provides an 
appropriation of $8,138,000, the same as the amount available 
for fiscal year 1997 and a decrease of $141,000 below the 
budget request.

                    Office of the Inspector General

1997 appropriation......................................     $63,028,000
1998 budget estimate....................................      65,259,000
Provided in the bill....................................      63,128,000
Comparison:
    1997 appropriation..................................        +100,000
    1998 budget estimate................................      -2,131,000

    The Office of the Inspector General was established October 
12, 1978, by the Inspector General Act of 1978. This reaffirmed 
and expanded the Office established by Secretary's Memorandum 
No. 1915, dated March 23, 1977.
    The Office is administered by an Inspector General who 
reports directly to the Secretary of Agriculture. Functions and 
responsibilities of this Office include direction and control 
of audit and investigative activities within the Department, 
formulation of audit and investigative policies and procedures 
regarding Department programs and operations, analysis and 
coordination of program-related audit and investigation 
activities performed by other Department agencies, and review 
of existing and proposed legislation and regulations regarding 
the impact such initiatives will have on the economy and 
efficiency of the Department's programs and operations and the 
prevention and detection of fraud and abuse in such programs. 
The activities of this Office are designed to assure compliance 
with existing laws, policies, regulations, and programs of the 
Department's agencies, and to provide appropriate officials 
with the means for prompt corrective action where deviations 
have occurred. The scope of audit and investigative activities 
is large and includes administrative, program, and criminal 
matters. These activities are coordinated, when appropriate, 
with various audit and investigative agencies of the executive 
and legislative branches of the government.

                          Committee Provisions

    For the Office of the Inspector General, the Committee 
provides an appropriation of $63,128,000, an increase of 
$100,000 above the amount available for fiscal year 1997 and a 
decrease of $2,131,000 below the budget request. The amount 
provided reflects the transfer in fiscal year 1997 of $100,000 
from Departmental Administration for personnel support 
services.

                     Office of the General Counsel

1997 appropriation......................................     $27,749,000
1998 budget estimate....................................      29,449,000
Provided in the bill....................................      27,949,000
Comparison:
    1997 appropriation..................................        +200,000
    1998 budget estimate................................      -1,500,000

    The Office of the General Counsel, originally known as the 
Office of the Solicitor, was established in 1910 as the law 
office of the Department of Agriculture, and manages all of the 
legal work arising from the activities of the Department. The 
General Counsel represents the Department on administrative 
proceedings for the promulgation of rules and regulations 
having the force and effect of law; in quasi-judicial hearings 
held in connection with the administration of various programs 
and acts; and in proceedings involving freight rates and 
practices relating to farm commodities. Counsel serves as 
General Counsel for the Commodity Credit Corporation and the 
Federal Crop Insurance Corporation and reviews criminal cases 
arising under the programs of the Department for referral to 
the Department of Justice.

                          Committee Provisions

    For the Office of General Counsel, the Committee provides 
an appropriation of $27,949,000, an increase of $200,000 above 
the amount available for fiscal year 1997 and a decrease of 
$1,500,000 below the budget request. The amount reflects the 
$200,000 transferred from Departmental Administration for civil 
rights activities in fiscal year 1997.

  Office of the Under Secretary for Research, Education, and Economics

1997 appropriation......................................        $540,000
1998 budget estimate....................................         547,000
Provided in the bill....................................         540,000
Comparison:
     1997 appropriation.................................................
     1998 budget estimate...............................          -7,000

    The Office of the Under Secretary for Research, Education, 
and Economics provides direction and coordination in carrying 
out the laws enacted by the Congress for food and agricultural 
research, education, extension, and economic and statistical 
information. The Office has oversight and management 
responsibilities for the Agricultural Research Service; 
Cooperative State Research, Education, and Extension Service; 
Economic Research Service; and National Agricultural Statistics 
Service.

                          Committee Provisions

    For the Office of the Under Secretary for Research, 
Education, and Economics, the Committee provides an 
appropriation of $540,000, the same as the amount available for 
fiscal year 1997 and a decrease of $7,000 below the budget 
request.

                       Economic Research Service

1997 appropriation......................................     $53,109,000
1998 budget estimate....................................      54,310,000
Provided in the bil.....................................      71,604,000
Comparison:
    1997 appropriation..................................     +18,495,000
    1998 budget estimate................................     +17,294,000

    The Economic Research Service (ERS) provides economic and 
other social science information and analysis for public and 
private decisions on agriculture, food, natural resources, and 
rural America. ERS produces such information for use by the 
general public and to help the executive and legislative 
branches develop, administer, and evaluate agricultural and 
rural policies and programs.

                          Committee Provisions

    For the Economic Research Service, the Committee provides 
an appropriation of $71,604,000, an increase of $18,495,000 
above the amount available for fiscal year 1997 and an increase 
of $17,294,000 above the budget request. The increase provided 
consolidates all studies and evaluations work of the food 
stamp, child nutrition, and WIC programs into one account. This 
work is to be carried out within the Food and Consumer 
Economics Division of the ERS which conducts research and 
analysis of food programs and food policy issues. The Committee 
expects ERS to consult and work with the staff at the Food and 
Consumer Service as well as other agencies to assure that all 
studies and evaluations are meeting the needs of the 
Department.
    The Committee expects the agency to study the nutritional 
advantages of including more beef, lamb, and chevon meats in 
the school lunch program. The results of this study should be 
reported to the Committee by February 1, 1998.

                National Agricultural Statistics Service

1997 appropriation......................................    $100,221,000
1998 budget estimate....................................     119,877,000
Provided in the bill....................................     118,361,000
Comparison:
    1997 appropriation..................................     +18,140,000
    1998 budget estimate................................      -1,516,000

    The National Agricultural Statistics Service (NASS) 
administers the Department's program of collecting and 
publishing current national, state, and county agricultural 
statistics, which are essential for making effective policy, 
production, and marketing decisions. These statistics provide 
accurate and timely estimates of current agricultural 
production and measures of the economic and environmental 
welfare of the agricultural sector. NASS also provides 
statistical services to other USDA and Federal agencies in 
support of their missions, and provides consulting, technical 
assistance, and training to developing countries.
    The fiscal year 1997 appropriation includes funding for the 
Census of Agriculture which has been transferred from the 
Department of Commerce to the Department of Agriculture to 
consolidate the activities of the two agricultural statistics 
programs. The Census of Agriculture is taken every five years 
and provides comprehensive data on the agricultural economy 
including: data on the number of farms, land use, production 
expenses, farm product values, value of land and buildings, 
farm size, and characteristics of farm operators. It provides 
national, state, and county data as well as selected data for 
Puerto Rico, Guam, and the United States Virgin Islands. The 
next agricultural census will be conducted beginning in January 
1998 for the calendar year 1997.

                          Committee Provisions

    For the National Agricultural Statistics Service, the 
Committee provides an appropriation of $118,361,000, an 
increase of $18,140,000 above the amount available for fiscal 
year 1997 and a decrease of $1,516,000 below the budget 
request. Included in this amount is $36,140,000 for the Census 
of Agriculture. The Census of Agriculture collects and provides 
comprehensive data every five years on all aspects of the 
agricultural economy. Fiscal year 1998 is the year data 
collection occurs.

                     Agricultural Research Service

1997 appropriation......................................    $716,826,000
1998 budget estimate....................................     726,797,000
Provided in the bill....................................     725,059,000
Comparison:
    1997 appropriation..................................      +8,233,000
    1998 budget estimate................................      -1,738,000

    The Agricultural Research Service (ARS) was established by 
the Secretary of Agriculture on November 2, 1953, under the 
authority of the Reorganization Act of 1949 (5 U.S.C. 133z-15), 
Reorganization Plan No. 2 of 1953, and other authorities. 
Pursuant to the Department of Agriculture Reorganization Act of 
1994 (7 U.S.C. 6912), ARS includes functions previously 
performed by the Human Nutrition Information Service and the 
National Agricultural Library. ARS conducts basic and applied 
research in the fields of animal sciences, plant sciences, 
entomology, soil and water conservation, agricultural 
engineering, utilization and development, human nutrition and 
consumer use, marketing, development of integrated farming 
systems, and development of methods to eradicate narcotic-
producing plants.
    ARS also directs research beneficial to the United States 
which can be advantageously conducted in foreign countries 
through agreements with foreign research institutions and 
universities, using foreign currencies for such purposes. This 
program is carried out under the authority of sections 104(b) 
(1) and (3) of Public Law 480, and the Agricultural Trade 
Development and Assistance Act of 1954, as amended.

                          Committee Provisions

    Salaries and expenses.--For salaries and expenses of the 
Agricultural Research Service the Committee provides an 
appropriation of $725,059,000, an increase of $8,233,000 above 
the amount available for fiscal year 1997 and a decrease of 
$1,738,000 below the budget request.
    The Committee has carefully reviewed the 72 projects 
recommended to be eliminated under the President's Budget. The 
Committee has concurred with many of these recommendations 
noting that all these projects are important to some aspect of 
agriculture and the nation's economy. In this regard, the 
Committee is retaining a number of important ongoing research 
projects that underpin critical agricultural production 
programs.
    Continuing programs.--The Committee directs the 
Agricultural Research Service to continue to fund the following 
areas of research in fiscal year 1998: biocontrol of yellowstar 
thistle; global climate change research; Formosan termites; 
molecular research in oat enhancement; animal health 
consortium; exploratory thermal chemical conversion to starch; 
enhanced use of plant proteins; weed management, crop 
management, and soybean disease research, Urbana, IL; soybean 
germplasm; sugarcane biotechnology research; Lyme disease 
research; apple research; evaluation of tissue cultured fruit 
crops; turf grass evaluation; reduction of chilling injury; 
germplasm evaluation of wild rice; enhancement of peanut 
flavor; peanut germplasm; processing of sweet potato products; 
evaluation of legumes and grasses in sustainable systems; 
soybean germplasm and production systems; germplasm enhancement 
of small fruits; club wheat research; and floriculture 
research.
    Location closures.--The Committee does not concur with the 
proposed closure of ARS research stations and directs the 
continuation of research at the major laboratories and 
worksites located at Prosser, WA; Mandan, ND; Orono, ME; and 
Brawley, CA.
    Streamlining and management savings.--The Committee 
approves the agency's request to reduce headquarters management 
divisions and staff funding by $550,000. The Committee also 
concurs with the request to reduce appropriations commensurate 
with streamlining efforts as proposed in the budget request.
    Evaluation studies.--The Committee notes that since the 
early 1980's, ARS received $1,000,000 for evaluation studies. 
These funds, which are used to finance various studies or 
reports that go beyond the ARS research mission, are deleted in 
fiscal year 1998. The Committee requests a detailed report of 
studies conducted with these appropriations for fiscal years 
1994 through 1997.
    Rice research.--The Committee is aware of the important 
rice research program conducted at the ARS Rice Research 
Laboratory in Beaumont, TX. The Committee provides an increase 
of $250,000 in fiscal year 1998 for rice research carried out 
in this laboratory.
    Biotechnology Research and Development Corporation.--The 
Committee expects the agency to continue its work on the 
Corporation's research at the same levels as fiscal year 1997, 
subject to administrative streamlining reductions concurred in 
by the Committee.
    Asian long-horned beetle.--The Asian Long-horned Beetle is 
a major threat to trees in urban areas and forested ares of the 
Northeast. It was first found in trees in North America in 
Greenpoint, New York. In New York, the beetle has been 
attacking a variety of trees including: maple, chestnut, 
poplar, willow, elm, mulberry and locust. The insect is native 
to Japan, Korea and China, where it kills trees. In New York, 
the current strategy to eradicate this insect is to fell, chop, 
and burn affected trees. The Committee provides an increase of 
$500,000 to investigate the biology and ecology of this pest 
and to implement biological control and foreign exploration for 
natural enemies.
    Citrus tristeza.--The Committee provides an increase of 
$500,000 for citrus tristeza research to assist the citrus 
industry in the suppression and eradication of this citrus 
virus.
    Cotton ginning research.--The Committee provides $750,000 
for staffing three scientists at the Cotton Ginning Laboratory 
at Lubbock, TX.
    Northwest nursery crop research.--The Committee supports 
the important research carried out at the Northwest Nursery 
Crop Research Laboratory at Corvallis, OR. An increase of 
$500,000 is provided for nursery crop research carried out at 
this laboratory.
    Small grains research.--An increase of $462,000 is provided 
to hire a small grain pathologist at the ARS laboratory in 
Raleigh, NC and one at the ARS laboratory in Aberdeen, Idaho.
    Food fermentation research.--An increase of $270,000 is 
provided to enhance the research conducted at the Food 
Fermentation Laboratory in Raleigh, NC.
    Legumes research.--An increase of $250,000 is provided to 
support grain legume plant genetics investigations underway at 
Pullman, WA.
    Hops research.--The Committee recognizes the important 
contribution of the ARS hops research program in the Pacific 
Northwest. An increase of $100,000 to strengthen this research 
is provided for fiscal year 1998.
    Food safety through organics management research.--The 
Committee provides an increase of $500,000 for research on bio-
minerals. This is a public-private partnership to develop 
guidelines and recommended practices for the use of bio-organic 
materials that have been stabilized by composting or by 
advanced alkaline technology. Every year billions of tons of 
animal waste are spread on agricultural land. The results of 
this project will reduce human health risks by helping control 
pathogenic organisms in animal waste.
    Poult enteritis and mortality syndrome (PEMS) research.--
Poult Enteritis Mortality Syndrome (PEMS) has cost U.S. turkey 
producers almost $100 million since 1991. Although nearly half 
of these losses have occurred in North Carolina, outbreaks have 
also occurred in Arkansas, Georgia, Indiana, New York, South 
Carolina, and Virginia. The origin and cause of this highly 
infectious disease that kills about 70 percent of the birds in 
an infected flock is still unknown. To meet the urgent need for 
PEMS research the Committee provides an increase of $250,000 in 
fiscal year 1998 for the Southeast Poultry Research Laboratory 
in Athens, Georgia.
    Sugarcane research.--The Committee provides an increase of 
$200,000 for research at the Houma, LA, research worksite for 
an additional scientist and $500,000 for the Canal Point, FL, 
laboratory to identify sugarcane germplasm aimed at improving 
sugarcane tolerance to high water tables.
    The Committee supports the cooperative research carried out 
by the Southern Regional Research Center and the Sugar 
Processing Research Institute. This research agreement on 
product quality and new product development is jointly funded 
by ARS and the cane and sugar beet industries. The Committee 
urges ARS to increase funding for this joint research.
    Vomitoxin research.--The Committee provides an increase of 
$500,000 to expedite research on vomitoxin contamination in 
wheat yields.
    Formosan termite control.--The Committee recognizes the 
growing threat of the Formosan termite to homes, buildings, 
forests, and crops throughout Hawaii and the Southern United 
States especially Texas, Florida, and Louisiana. Populations of 
this imported pest are growing exponentially because 
traditional protectants are ineffective. Prevention, control, 
and damage repair costs are already estimated to be $1 billion. 
To control this exotic pest, the Committee provides an increase 
of $5,000,000 in fiscal year 1998 for a coordinated control and 
research demonstration program.
    Oat and barley research.--The Committee expects the agency 
to continue its research projects related to oats and barley.
    Viticulture research.--The Committee expects the ARS to 
provide increased emphasis on its viticulture research. The 
grape and wine industry is one of the largest agriculture 
industries. Additional resources would help address needs in 
rootstock development, variety/clone development, vine cold 
hardiness and other research. This is necessary if the U.S. is 
to remain competitive in the dynamic international marketplace.
    Lyme disease.--For research on Lyme disease, the Committee 
provides $745,000. Included in this amount is $175,000 for a 
cooperative research project on tick-borne disease in 
Connecticut and Westchester County, New York. The Committee 
also expects the Beltsville Agricultural Research Center, in 
its Lyme disease research efforts, to support and participate 
in the implementation of a tick management project to be 
conducted in Lyme disease endemic areas of Connecticut; 
Westchester County, New York; Rhode Island; and New Jersey.
    Apple pathogens.--The Committee provides $250,000 for apple 
specific research on E. coli and other pathogens. This research 
will enable researchers to follow the path of contamination and 
identify alternative methods of effectively killing pathogens.
    Coastal wetlands erosion control.--The Committee has 
provided $1,000,000 to continue and expand research efforts at 
the Rice Research Station in Louisiana specifically for 
wetlands plant production and testing under controlled green 
house environments and field evaluations including the 
development and implementation of artificial and genetic 
engineering technology for erosion control purposes.
    Ergot research.--The Committee provides an increase of 
$250,000 to initiate research on this serious sorghum disease. 
This disease is expected to affect the U.S. sorghum industry if 
not immediately addressed.
    Poisonous plant research.--The Committee provides an 
increase of $200,000 to strengthen research on poisonous 
rangeland plants carried out at the ARS Logan, UT laboratory.
    Weed bio-control project.--The Committee is concerned that 
30 million acres of western rangeland is threatened by a number 
of plant pests including yellowstar thistle and Medusahead. To 
help provide biological controls for these pests, the Committee 
provides an increase of $250,000 in fiscal year 1998 for a weed 
bio-control project at the Western Regional Research Center in 
Albany, California.
    Emerging diseases and exotic pests.--The Committee provides 
$2,000,000 in addition to funds appropriated in fiscal year 
1997 to limit the introduction and spread of exotic diseases 
and pests in the U.S. These resources should be split between 
plant and livestock research programs.
    Swine research.--The Committee directs ARS to conduct a 
review of ongoing swine research and report to the Committee 
options for consolidation of that research at the National 
Swine Research Center in Ames, IA. The Committee encourages ARS 
to investigate possible cost-share arrangements with Iowa State 
University and swine producer groups for the operation and 
maintenance of the National Swine Research Center.
    Food safety research.--Congress appropriated an increase of 
$5,500,000 in fiscal year 1997 to ARS for food safety research. 
The Committee provides an additional increase of $2,000,000 for 
pre- and post-harvest food safety research for fiscal year 
1998.
    Genetic resources.--The Committee provides an increase of 
$500,000 for fiscal year 1998 for the preservation of plant 
genetic resources. This appropriation is in addition to the 
$500,000 increase provided by Congress for fiscal year 1997. 
The Committee specifically funds the agency's need to support 
clonal repositories located in Hilo, HI; Riverside and Davis, 
CA; and Corvallis, OR, as requested.
    Grazingland utilization and conservation research.--The 
Committee provides an increase of $750,000 for research to 
improve production and conservation technologies through 
pasture and range management systems. This work is to be 
carried out at the El Reno, OK; Las Cruces, NM; and University 
Park, PA research laboratories.
    Pest management.--The Committee provides an increase of 
$1,000,000 for fiscal year 1998 for IPM and biocontrol 
research. In fiscal year 1997, the Congress provided ARS with 
an increase of $3,000,000 for IPM research. The Committee notes 
that the Department's current effort for Integrated Pest 
Management and related programs amounts to $216,000,000, most 
of which is in research. ARS' research on chemical and non-
chemical means of pest control is reported as $134,200,000 for 
this fiscal year. The Committee directs that the Department's 
programs and resources be coordinated and managed to more 
effectively deal with the IPM initiative goal of having IPM 
practices on 75 percent of crop acreage by the year 2000. In 
this regard, the Committee will expect a report detailing 
current programs and resources carried out by the Department 
with respect to pest management activities and efforts to 
focus, manage, and coordinate these significant resources to 
accomplish IPM systems approaches to targeted farm acreage. 
Within the increase provided for integrated pest management, 
the Committee provides $100,000 for the National Arboretum to 
develop a landscape IPM program.
    Plum Island lighthouse.--The Committee expects the 
Department of Agriculture to investigate the current state of 
the lighthouse located on Plum Island, New York. The Department 
should report back to the Committee the status of the 
lighthouse and the actions the Department will take to protect 
and preserve this historic structure. The Department should 
provide the report to the appropriate Committees of Congress by 
March 31, 1998.
    Survey of food intakes of infants and children.--The 
Committee provides the $5,000,000 that is necessary to respond 
to the requirements of the Food Quality and Protection Act. The 
survey will enable the Secretary to provide the Environmental 
Protection Agency with essential information on food 
consumption patterns of infants and children. This data will 
also be useful to other agencies that address similar or 
related issues.
    Plant genetics research equipment.--The Committee provides 
an increase of $200,000 for research equipment, 
instrumentation, and greenhouses at the ARS Columbia, MO 
laboratory.
    Meadowfoam.--Meadowfoam is a plant whose seed oil is being 
researched for uses in cosmetics, plastics, metalworking 
lubricants, ink, textile fiber lubricants, and other industrial 
products. This seed presents an opportunity for a new cash crop 
for farmers. The Committee expects the ARS to provide 
additional resources from its new products program to expand 
reseach on this potential new crop.
    Phytoestrogen.--The Committee expects the ARS to continue 
its work on phytoestrogen at its current level.
    Methyl bromide.--The Committee expects the agency to 
continue its work on methyl bromide at the same level as fiscal 
year 1997.
    National Warmwater Aquaculture Research Center.--The 
Committee directs the Agriculture Research Service to rename 
the National Warmwater Aquaculture Research Center in 
Stoneville, Mississippi, as The Thad Cochran National Warmwater 
Aquaculture Center.

                        Buildings and Facilities

1997 appropriation......................................     $69,100,000
1998 budget estimate....................................      59,300,000
Provided in the bill....................................      59,000,000
Comparison:
    1997 appropriation..................................     -10,100,000
    1998 budget estimate................................        -300,000

    The ARS Buildings and Facilities account was established 
for the acquisition of land, construction, repair, improvement, 
extension, alteration, and purchase of fixed equipment or 
facilities which directly or indirectly support research and 
extension programs of the Department. Routine construction or 
replacement items would continue to be funded under the 
limitations contained in the regular account.

                          Committee Provisions

    For Agricultural Research Service, Buildings and 
Facilities, the Committee provides an appropriation of 
$59,000,000, a decrease of $10,100,000 below the amount 
available for fiscal year 1997 and a decrease of $300,000 below 
the budget request.
    The following table summarizes the Committee's provisions:

                      AGRICULTURAL RESEARCH SERVICE                     
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                     FY 1997      FY 1998     Committee 
                                     enacted      estimate    provisions
------------------------------------------------------------------------
     BUILDINGS AND FACILITIES                                           
                                                                        
California:                                                             
     Horticulture Crops and Water                                       
     Management, Parlier.........  ...........      $23,400      $23,400
     Western Regional Research                                          
     Center, Albany..............       $4,000  ...........  ...........
    Western Human Nutrition Lab,                                        
     Davis.......................  ...........  ...........        1,700
Florida:                                                                
    Horticulture Research Lab,                                          
     Ft. Pierce..................       27,000  ...........  ...........
    Melaleuca Research and                                              
     Quarantine Facility, Ft.                                           
     Lauderdale..................  ...........        4,000  ...........
Illinois:                                                               
    National Center for                                                 
     Agricultural Utilization                                           
     Research, Peoria............        1,500        8,000        8,000
    Ethanol pilot plant,                                                
     Edwardsville................        1,500  ...........  ...........
Kansas:                                                                 
    Grain Marketing Research Lab,                                       
     Manhattan...................          500  ...........  ...........
Louisiana:                                                              
    Southern Regional Research                                          
     Center, New Orleans.........  ...........        1,100        1,100
Maryland:                                                               
    Beltsville Agricultural                                             
     Research Center.............        4,500        3,200        3,200
    National Agricultural                                               
     Library, Beltsville.........  ...........        6,000        3,000
Michigan:                                                               
    Avian Disease Lab, Lansing...  ...........  ...........        1,800
New York:                                                               
    Plum Island Animal Disease                                          
     Center......................        5,000        5,000        4,000
North Dakota:                                                           
    Nutrition Lab, Grand Forks...  ...........  ...........        4,400
Pennsylvania:                                                           
     Eastern Regional Research                                          
     Center, Philadelphia........        4,000        5,200        5,000
South Carolina:                                                         
     U.S. Vegetable Lab,                                                
     Charleston..................        3,000  ...........  ...........
Texas:                                                                  
     Plant Stress Lab, Texas Tech                                       
     University..................        8,100  ...........  ...........
     Subtropical Lab, Weslaco....        4,000  ...........  ...........
West Virginia:                                                          
    National Center for Cool and                                        
     Cold Water Aquaculture,                                            
     Leetown.....................        6,000  ...........  ...........
France:                                                                 
    European Biological Control                                         
     Laboratory, Montpellier.....  ...........        3,400        3,400
                                  --------------------------------------
      Total, Buildings and                                              
       Facilities................      $69,100      $59,300      $59,000
------------------------------------------------------------------------

    The Committee provides $1,700,000 for the planning and 
design of the Western Human Nutrition Research Center, Davis, 
California. These funds are required for design of a 
replacement nutrition facility to be located on the campus of 
the University of California, Davis. The Committee also 
provides a total of $3,400,000 for the completion of the 
European Biological Control Laboratory. This amount represents 
the full funding to complete all phases of construction of this 
replacement facility.

      Cooperative State Research, Education, and Extension Service

    The Cooperative State Research, Education, and Extension 
Service (CSREES) was established by the Secretary of 
Agriculture on October 1, 1994, under the authority of the 
Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 
6912). The Service was created by the merger of the Cooperative 
State Research Service and the Extension Service. The mission 
of CSREES is to work with university partners to advance 
research, extension, and higher education in the food and 
agricultural sciences and related environmental and human 
sciences to benefit people, communities, and the Nation.

                   Research and Education Activities

1997 appropriation......................................    $421,504,000
1998 budget estimate....................................     422,342,000
Provided in the bill....................................     420,723,000
Comparison:
    1997 appropriation..................................        -781,000
    1998 budget estimate................................      -1,619,000

    The research and education programs administered by the 
Cooperative State Research, Education, and Extension Service 
were established by Secretary's Memorandum No. 1462, dated July 
19, 1961 and Supplement 1, dated August 31, 1961, and under 
Reorganization Plan No. 2 of 1953. The primary function of 
research and education activities is to administer Acts of 
Congress that authorize Federal appropriations for agricultural 
research and higher education carried on by the State 
Agricultural Experiment Stations of the 50 States, District of 
Columbia, Puerto Rico, Guam, the Virgin Islands, American 
Samoa, Micronesia, and Northern Mariana Islands, and by 
approved schools of forestry, the 1890 land-grant colleges and 
Tuskegee University, the 1994 land-grant institutions, and 
other eligible institutions. Administration of payments and 
grants involves the approval of each research proposal to be 
financed in whole or in part from Federal grant funds; the 
continuous review and evaluation of research and higher 
education programs and expenditures thereunder; and the 
encouragement of cooperation within and between the states and 
with the research programs of the Department of Agriculture.

                          Committee Provisions

    For payments under the Hatch Act, the Committee provides an 
appropriation of $168,734,000, the same as the amount available 
for fiscal year 1997 and the same as the budget request.
    For cooperative forestry research, the Committee provides 
an appropriation of $20,497,000, the same as the amount 
available for fiscal year 1997 and the same as the budget 
request.
    For payments to the 1890 land-grant colleges and Tuskegee 
University, the Committee provides an appropriation of 
$27,735,000, the same as the amount available for fiscal year 
1997 and the same as the budget request.

                         RESEARCH AND EDUCATION                         
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                 FY 1997     FY 1998       Committee    
                                 enacted    estimate       provisions   
------------------------------------------------------------------------
    RESEARCH AND EDUCATION                                              
          ACTIVITIES                                                    
                                                                        
Payments Under Hatch Act.....    $168,734    $168,734           $168,734
Cooperative forestry research                                           
 (McIntire-Stennis)..........      20,497      20,497             20,497
Payments to 1890 colleges and                                           
 Tuskegee....................      27,735      27,735             27,735
Special Research Grants (P.L.                                           
 89-106):                                                               
    Aegilops cylindricum (WA)         296  ..........                296
    Aflatoxin (IL)...........         113  ..........  .................
    Agriculture based                                                   
     industrial lubricants                                              
     (IA)....................  ..........  ..........                200
    Agricultural                                                        
     diversification (HI)....         131  ..........  .................
    Agricultural diversity/                                             
     Red River Corridor (MN,                                            
     ND).....................  ..........  ..........                250
    Alliance for food                                                   
     protection (NE, GA).....         300  ..........                300
    Alternative crops (ND)...         550  ..........  .................
    Alternative crops for                                               
     arid lands (TX).........          85  ..........  .................
    Alternative marine and                                              
     fresh water species (MS)         308  ..........  .................
    Apple fireblight (MI, NY)         325  ..........                325
    Aquaculture (IL).........         169  ..........                169
    Aquaculture (LA).........         330  ..........                330
    Aquaculture (MS).........         592  ..........  .................
    Aquaculture (NC).........         150  ..........  .................
    Babcock Institute (WI)...         312  ..........                312
    Barley feed for rangeland                                           
     cattle (MT).............         500  ..........                500
    Binational Ag. Research &                                           
     Dev.....................       2,000       2,500  .................
    Biodiesel research (MO)..         152  ..........  .................
    Biotechnology (OR).......         250  ..........  .................
    Broom snakeweed (NM).....         175  ..........                185
    Canola (KS)..............          85  ..........  .................
    Center for animal health                                            
     and productivity (PA)...         113  ..........                113
    Center for innovative                                               
     food technology (OH)....         181  ..........                181
    Center for rural studies                                            
     (VT)....................          32  ..........  .................
    Chesapeake Bay                                                      
     aquaculture.............         370  ..........                370
    Citrus decay fungus (AZ).  ..........  ..........                250
    Coastal cultivars (GA)...         200  ..........                250
    Competitiveness of                                                  
     agricultural products                                              
     (WA)....................         677  ..........                677
    Cool season legume                                                  
     research (ID, WA).......         329  ..........                329
    Cranberry/blueberry                                                 
     disease and breeding                                               
     (NJ)....................         220  ..........                220
    Dairy and meat goat                                                 
     research (TX)...........          63  ..........  .................
    Delta rural                                                         
     revitalization (MS).....         148  ..........  .................
    Drought mitigation (NE)..         200  ..........                200
    Environmental research                                              
     (NY)....................         486  ..........                486
    Environmental risk                                                  
     factors--cancer (NY)....         100  ..........                100
    Expanded wheat pasture                                              
     (OK)....................         285  ..........                285
    Farm and rural business                                             
     finance (IL, AR)........         106  ..........  .................
    Floriculture (HI)........         250  ..........  .................
    Food and Agriculture                                                
     Policy Institute (IA,                                              
     MO).....................         800  ..........                800
    Food irradiation (IA)....         201  ..........                200
    Food Marketing Policy                                               
     Center (CT).............         332  ..........                332
    Food Processing Center                                              
     (NE)....................          42  ..........                 42
    Food safety consortium                                              
     (AR, KS, IA)............       1,690  ..........  .................
    Food Safety Initiative...  ..........       2,000  .................
    Food systems research                                               
     group (WI)..............         221  ..........                221
    Forestry (AR)............         523  ..........  .................
    Fruit and vegetable                                                 
     market analysis (AZ, MO)         296  ..........                296
    Generic commodity                                                   
     promotion research and                                             
     evaluation (NY).........         212  ..........                212
    Global change............       1,567       1,567  .................
    Global marketing support                                            
     service (AR)............          92  ..........  .................
    Grain Sorghum (KS).......         106  ..........                106
    Grass seed cropping                                                 
     systems for a                                                      
     sustainable agriculture                                            
     (WA, OR, ID)............         423  ..........                423
    Human nutrition (IA).....         473  ..........                473
    Human nutrition (LA).....         752  ..........                752
    Human nutrition (NY).....         622  ..........                622
    Hydroponic tomato                                                   
     production (OH).........  ..........  ..........                140
    Illinois-Missouri                                                   
     Alliance for                                                       
     Biotechnology...........       1,316  ..........  .................
    Improved dairy management                                           
     practices (PA)..........         296  ..........                296
    Improved fruit practices                                            
     (MI)....................         445  ..........                445
    Institute for Food                                                  
     Science and Engineering                                            
     (AR)....................         750  ..........  .................
    Integrated production                                               
     systems (OK)............         161  ..........  .................
    International arid lands                                            
     consortium..............         329  ..........                329
    Iowa biotechnology                                                  
     consortium..............       1,738  ..........  .................
    Landscaping for water                                               
     quality (GA)............         300  ..........                300
    Livestock and dairy                                                 
     policy (NY, TX).........         445  ..........                445
    Lowbush blueberry                                                   
     research (ME)...........         220  ..........  .................
    Maple research (VT)......          84  ..........  .................
    Michigan biotechnology                                              
     consortium..............         750  ..........  .................
    Midwest advanced food                                               
     manufacturing alliance..         423  ..........                423
    Midwest agricultural                                                
     products (IA)...........         592  ..........                592
    Milk safety (PA).........         268  ..........  .................
    Minor use animal drug....         550         550                550
    Molluscan shellfish (OR).         400  ..........  .................
    Multi-commodity research                                            
     (OR)....................         364  ..........                364
    Multi-cropping strategies                                           
     for aquaculture (HI)....         127  ..........  .................
    National biological                                                 
     impact assessment.......         254         254                254
    Nematode resistance                                                 
     genetic engineering (NM)         127  ..........                127
    Non-food agricultural                                               
     products (NE)...........          64  ..........                 64
    North central                                                       
     biotechnology initiative       1,940  ..........  .................
    Oil resources from desert                                           
     plants (NM).............         175  ..........                175
    Organic waste utilization                                           
     (NM)....................         100  ..........                100
    Pasture and Forage                                                  
     Research (UT)...........         200  ..........                200
    Peach tree short life                                               
     (SC)....................         162  ..........  .................
    Pest control alternatives                                           
     (SC)....................         106  ..........  .................
    Phytophthora root rot                                               
     (NM)....................         127  ..........                127
    Post Harvest Rice Straw                                             
     (CA)....................         100  ..........                200
    Potato Cultivars (AK)....         120  ..........  .................
    Potato research..........       1,214  ..........              1,214
    Poultry carcass removal                                             
     (AL)....................  ..........  ..........                250
    Preharvest food safety                                              
     (KS)....................         212  ..........                212
    Preservation and                                                    
     processing research (OK)         226  ..........                226
    Red River Corridor (MN,                                             
     ND).....................         169  ..........  .................
    Regional barley gene                                                
     mapping project.........         348  ..........                348
    Regionalized implications                                           
     of farm programs (MO,                                              
     TX).....................         294  ..........                294
    Rice modeling, (AR)......         395  ..........  .................
    Rural development centers                                           
     (PA, IA (ND), MS, OR)...         423         423                423
    Rural Policies Institute                                            
     (NE, MO)................         644  ..........                644
    Russian wheat aphid......  ..........  ..........                200
    Seafood and aquaculture                                             
     harvesting, processing,                                            
     and marketing (MS)......         305  ..........  .................
    Small fruit research (OR,                                           
     WA, ID).................         212  ..........                212
    Southwest consortium for                                            
     plant genetics and water                                           
     resources...............         338  ..........                338
    Soybean cyst nematode                                               
     (MO)....................         303  ..........                303
    Spatial Technologies for                                            
     Agric (MS)..............         350  ..........  .................
    STEEP II--water quality                                             
     in Northwest............         500  ..........                500
    Sustainable agriculture                                             
     (MI)....................         445  ..........                445
    Sustainable agriculture                                             
     and natural resources                                              
     (PA)....................          94  ..........  .................
    Sustainable agriculture                                             
     systems (NE)............          59  ..........                 59
    Sustainable pest mgt-                                               
     dryland wheat (MT)......         200  ..........                200
    Swine waste mgt (NC).....         215  ..........                300
    Tillage, silviculture,                                              
     waste management (LA)...         212  ..........                212
    Tropical and subtropical.       2,724  ..........              2,500
    Urban pests (GA).........          64  ..........                 64
    Vidalia Onions (GA)......  ..........  ..........                 84
    Viticulture consortium                                              
     (NY, CA)................         500  ..........                500
    Water conservation (KS)..          79  ..........  .................
    Water mgt (AL)...........         170  ..........  .................
    Water quality............       2,757       2,757              2,300
    Weed control (ND)........         423  ..........  .................
    Wheat genetic research                                              
     (KS)....................         176  ..........                176
    Wood utilization research                                           
     (OR, MS, NC, MN, ME, MI)       3,536  ..........              3,500
    Wool research (TX, MT,                                              
     WY).....................         212  ..........                212
                              ------------------------------------------
      Total, Special Research                                           
       Grants................      49,767      10,051             31,654
                              ==========================================
Improved pest control:                                                  
    Integrated pest                                                     
     management..............       2,731       8,000              4,210
    Pesticide clearance (IR-                                            
     4)......................       5,711      10,711              8,990
    Pesticide impact                                                    
     assessment..............       1,327       1,327              1,327
    Expert IPM decision                                                 
     support system..........         177         300                300
    Critical issues..........         200         200                500
    Emerging pest and disease                                           
     issues..................       1,623       4,200              2,000
                              ------------------------------------------
      Total, Improved pest                                              
       control...............      11,769      24,738             17,327
                              ==========================================
Competitive research grants:                                            
    Plant systems............      36,044      47,000             37,044
    Animal systems...........      23,104      29,500             24,854
    Nutrition, food quality,                                            
     and health..............       7,209      11,000              9,000
    Natural resources and the                                           
     environment.............      17,194      27,000             17,194
    Processes and new                                                   
     products................       6,755       9,000              6,755
    Markets, trade and policy       3,897       6,500              3,897
    Biotech consortiums......  ..........  ..........              4,000
    Genomics.................  ..........  ..........              3,000
    Citrus tristeza..........  ..........  ..........              1,000
                              ------------------------------------------
      Total, Competitive                                                
       research grants.......      94,203     130,000            106,744
                              ==========================================
Animal Health and Disease                                               
 (Sec. 1433).................       4,775       4,775              4,500
Critical Agricultural                                                   
 Materials Act...............         500  ..........                500
Aquaculture Centers (Sec.                                               
 1475).......................       4,000       4,000              4,000
Rangeland Research Grants                                               
 (Sec. 1480).................         475  ..........  .................
Alternative crops............         650         650                650
Sustainable agriculture......       8,000       8,000              8,000
Capacity building grants.....       9,200       9,200              9,200
Payments to the 1994                                                    
 institutions................       1,450       1,450              1,450
Graduate fellowship grants...       3,000       3,000              3,000
Institution challenge grants.       4,000       4,350              4,350
Multcultural scholars program       1,000       1,000              1,000
Hispanic serving institutions       1,500       1,500              2,500
Federal Administration:                                                 
    Agriculture development                                             
     in American Pacific.....         564  ..........                564
    Agriculture waste                                                   
     utilization (WV)........  ..........  ..........                360
    Alternative Fuels                                                   
     Characterization Lab                                               
     (ND)....................         218  ..........                218
    Center for Agricultural                                             
     and Rural Development                                              
     (IA)....................         355  ..........                355
    Center for North American                                           
     Studies (TX)............          87  ..........                 87
    Data Information System..         400       1,000                500
    Geographic information                                              
     system..................         844  ..........  .................
    Mississippi Valley State                                            
     University..............         583  ..........  .................
    National Center for                                                 
     Peanut Competitiveness..  ..........  ..........                150
    National Education Center                                           
     for Agricultural Safety,                                           
     (IA)....................         300  ..........  .................
    Office of Extramural                                                
     Programs................         310         310                310
    Pay costs and FERS                                                  
     (prior).................         833       1,002                833
    Peer panels..............         350         350                350
    PM-10 study (CA, WA).....         873  ..........                873
    Shrimp aquaculture (AZ,                                             
     HI, MS, MA, SC).........       3,354  ..........              3,354
    Water quality (IL).......         492  ..........                492
    Water quality (ND).......         436  ..........                436
    Rural partnership (NE)...         250  ..........  .................
                              ------------------------------------------
      Total, Federal                                                    
       Administration........      10,249       2,662              8,882
                              ==========================================
      Total, Research and                                               
       Education Activities..    $421,504    $422,342           $420,723
------------------------------------------------------------------------

    Alternative crops.--The Committee provides $650,000 of 
which $500,000 is for canola research and $150,000 is for 
hesperaloe research.
    Citrus decay fungus research.--The Committee is concerned 
about the rapid spread of citrus fungus decay in southwestern 
Arizona where it has infected 40 percent of the lemon acreage. 
Given the economic significance of this infestation, the 
Committee provides $250,000 in fiscal year 1998 to the 
University of Arizona for research to develop preventive and 
remedial treatments.
    National Center for Peanut Competitiveness.--The Committee 
has provided $150,000 for the National Center for Peanut 
Competitiveness. The Center will perform intensive economic, 
genetic, and biotechnological research to develop peanut 
production systems that are more pest resistant, less sensitive 
to moisture stress, and more competitive in the global market. 
In addition, the Center will seek to create a safer and more 
nutritious product by reducing aflatoxin problems and by 
studying the nutritional aspects of peanuts. The Committee 
strongly supports the National Center for Peanut 
Competitiveness and expects USDA to exploit every opportunity 
to collaborate with the Center.
    Hydroponic tomato production.--This project will develop 
and demonstrate economically viable, pesticide free, hydroponic 
greenhouse tomato growing systems. The project will integrate 
new low cost energy efficient greenhouse designs and computer 
controlled fertigation systems. The Committee provides $140,000 
to Ohio State University to support this innovative project in 
Northwest Ohio.
    Vidalia onion research.--This two year project will focus 
on enhancing the quality of Vidalia onions. This work is 
particularly important considering the recent increase in 
imported onions. The Committee provides $84,000 for Georgia to 
undertake this research essential to supporting the onion 
industry.
    Poultry carcass removal.--Increased production in the 
poultry industry to meet both domestic and export demand has 
created a significant environmental problem in dealing with the 
disposal of dead birds. The industry needs a safe and effective 
recycling service to eliminate the problems associated with 
burial pits, composting, and incineration. The University of 
West Alabama and Alabama Protein Recycling has proposed an 
alternative disposal system that pelletizes and dehydrates the 
carcasses producing a safe and high quality animal feed. The 
Committee provides $250,000 to support developing systems to 
recycle poultry carcasses into animal feed.
    Agriculture waste utilization.--Included under Federal 
Administration is $360,000 for the Department to cooperate with 
the West Virginia Department of Agriculture to continue 
research and development on technology demonstrations 
associated with a combined poultry and municipal waste 
processing and recovery facility. The POWER facility uses an 
anaerobic digestion process which reduces or eliminates odor 
and pathogens in agriculture waste and generates methane gas 
and useable fertilizer.
    Food safety.--The budget request included a special 
research line item for part of the food safety initiative. The 
Committee did not concur with this request but instead provided 
an increase of $1,800,000 in the competitive research line for 
nutrition, food quality, and health. The Agency should use 
these funds to increase research on food safety. The Committee 
also expects the Food Safety Consortium to compete for these 
funds.
    Biotechnology consortiums.--In past years, the Committee 
has provided funds for five specific biotechnology consortiums 
or projects (Michigan, Iowa, North Central, and Illinois-
Missouri Alliance biotechnology consortiums and the Oregon 
biotechnology project). This year, instead of providing 
individual earmarks, the Committee has provided a competitive 
grant line item of $4,000,000 for biotechnology. The Committee 
expects the agency to establish a National Research Initiative 
item for biotechnology and the projects previously funded as 
separate items should compete for these funds.
    Genomics.--Under the National Research Initiative 
competitive grants program, the Committee has provided a new 
category of $3,000,000 for plant and animal genomics. The 
Committee recognizes the critical role that genomics research 
can play in the improvement of plant and animal production and, 
ultimately, in the improvement of the environment. The 
Committee believes that a competitive plant and animal genomics 
program will provide for significant advancements for plant and 
animal species.
    Citrus tristeza.--The Committee has provided under the 
National Research Initiative a new line item of $1,000,000 for 
a competitive research program for the control of citrus brown 
aphid and citrus tristeza. Citrus tristeza virus (CTV) is a 
serious threat to the U.S. citrus industry. CTV can cause 
citrus trees to die and/or cause reduced yield or the fruit to 
be so small as to be unmarketable. The virus is spreading 
throughout citrus growing areas of the United States. Its 
spread appears to be caused by the citrus brown aphid. This 
research effort should focus on control and eventual 
eradication of the pest.
    Agriculture based industrial lubricants, IA.--The Committee 
provides $200,000 for a special grant to assist in the 
identification and verification of new uses of modified 
vegetable oils. Newly genetically modified oil seeds and their 
oils could be the new seedstock for a new generation of 
vegetable oils and environmentally friendly industrial 
lubricants.
    Agriculture diversity (ND, MN).--The Committee provides 
$250,000 for an agriculture diversity research project in the 
Northern Great Plains. Diversification into new, high value 
crops could improve survival of the Northern Great Plains small 
producers. This project should incorporate an analysis of the 
various components of agriculture diversification as it relates 
to an emerging vegetable industry in the region.
    Water Quality Center of Excellence.--The Committee is aware 
of a number of ongoing cooperative efforts among USDA agencies 
and the 1890s colleges and universities. Centers of Excellence 
established in cooperation with one or more USDA agencies and 
an 1890 institution provide a means to meet Department needs 
and strengthen these institutions. The Committee is aware of 
the work at the Water Quality Center of Excellence at Florida 
A&M University, which is a positive example of coordination 
between USDA and universities.

              Native American Institutions Endowment Fund

1997 appropriation......................................    ($4,600,000)
1998 budget estimate....................................     (4,600,000)
Provided in the bill....................................     (4,600,000)
Comparison:
    1997 appropriation.......................(.........................)
    1998 budget estimate.....................(.........................)

    The Native American Institutions Endowment Fund authorized 
by Public Law 103-382 provides authority to establish an 
endowment for the 1994 land-grant institutions (29 tribal 
controlled colleges). This program will enhance educational 
opportunities for Native Americans by building educational 
capacity at these institutions in the areas of student 
recruitment and retention, curricula development, faculty 
preparation, instruction delivery systems, and scientific 
instrumentation for teaching. On the termination of each fiscal 
year, the Secretary shall withdraw the income from the 
endowment fund for the fiscal year, and after making 
adjustments for the cost of administering the endowment fund, 
distribute the adjusted income as follows: sixty percent of the 
adjusted income from these funds shall be distributed among the 
1994 land-grant institutions on a pro-rata basis, the 
proportionate share being based on the Indian student count; 
and forty percent of the adjusted income shall be distributed 
in equal shares to the 1994 land-grant institutions.

                          Committee Provisions

    For the Native American Institutions Endowment Fund, the 
Committee provides $4,600,000, the same as the amount available 
in fiscal year 1997 and the same as the budget request.

                          Extension Activities

1997 appropriation......................................    $426,273,000
1998 budget estimate....................................     417,811,000
Provided in the bill....................................     415,110,000
Comparison:
    1997 appropriation..................................     -11,163,000
    1998 budget estimate................................      -2,701,000

    Cooperative agricultural extension work was established by 
the Smith-Lever Act of May 8, 1914, as amended. The legislation 
authorizes the Department of Agriculture to give, through the 
land-grant institutions, instruction and practical 
demonstrations in agricultural and home economics and related 
subjects, and to encourage the application of such information 
by means of demonstrations, publications, and otherwise to 
persons not attending or a resident in the colleges. In 
addition, the Service provides nutrition training to low-income 
families, 4-H Club work, and educational assistance such as 
community resource development.

                          Committee Provisions

    For Extension activities, the Committee provides an 
appropriation of $415,110,000, a decrease of $11,163,000 below 
the amount available for fiscal year 1997 and a decrease of 
$2,701,000 below the budget request.
    The following table reflects the amount provided by the 
Committee:

                         RESEARCH AND EDUCATION                         
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                         FY 1997    FY 1998    Committee
                                         enacted    estimate  provisions
------------------------------------------------------------------------
         Extension Activities                                           
                                                                        
Smith Lever 3(b) & 3(c)...............   $268,493   $268,493    $268,493
Smith Lever: 3(d)                                                       
    Pest management...................     10,783     15,000      10,783
    Water quality.....................     10,733      9,061       9,061
    Farm safety.......................      2,855  .........       2,855
    Food and nutrition education                                        
     (EFNEP)..........................     58,695     58,695      58,695
    Pesticide impact assessment.......      3,214      3,313       3,214
    Rural development centers.........        908        908         908
    Sustainable agriculture...........      3,309      3,309       3,309
    Food safety.......................      2,365      4,365       2,365
    Youth-at-risk.....................      9,554     11,700       9,554
    Indian Reservation agents.........      1,672      1,672       1,672
    Pesticide applicator training.....  .........      1,500  ..........
1890 Colleges and Tuskegee............     25,090     25,090      25,090
1890 facilities grants................      7,549      7,549       7,549
Renewable Resources Extension Act.....      3,192  .........       3,192
Agricultural telecommunications.......      1,167  .........  ..........
Rural health and safety education.....      2,628  .........  ..........
Extension services at the 1994                                          
 Institutions.........................      2,000      2,000       2,000
                                       ---------------------------------
      Subtotal........................    414,207    412,655     408,740
                                       =================================
Federal Administration and special                                      
 grants:                                                                
    General administration............      4,995      5,156       4,975
    Pilot tech. transfer (OK, MS).....        326  .........  ..........
    Pilot tech. transfer (WI).........        163  .........         163
    Rural rehabilitation (GA).........        246  .........  ..........
    Income enhancement demonstration                                    
     (OH).............................        246  .........         246
    Rural development (NM)............        227  .........         247
    Rural development (NE)............        386  .........  ..........
    Rural Development (OK)............        296  .........  ..........
    Beef producers' improvement (AR)..        197  .........  ..........
    Integrated cow/calf resources                                       
     management (IA)..................        345  .........         345
    Extension specialist (AR).........         99  .........  ..........
    Extension specialist (MS).........         50  .........  ..........
    Rural Center for the Study and                                      
     Promotion of HIV/STD Prevention                                    
     (IN).............................        246  .........  ..........
    Delta Teachers Academy............      3,850  .........  ..........
    Wood biomass as an alternative                                      
     farm product (NY)................        197  .........         197
    Range improvement (NM)............        197  .........         197
                                       ---------------------------------
      Total, Federal Administration                                     
       and special grants.............     12,066      5,156       6,370
                                       =================================
      Total, Extension Activities.....   $426,273   $417,811    $415,110
------------------------------------------------------------------------

    The Committee directs the Department to work with the 
applicants for section 3(d) grants to develop matching funding 
from non-Federal sources.
    The Committee fully supports the food safety initiative and 
expects that the food safety and expanded food and nutrition 
education programs be refocused to enhance and support the food 
safety education activities of this initiative.
    The Committee is aware that state extension agents in 
Florida and North Dakota have been used to assist in providing 
behavioral health services to the victims of natural disasters. 
The Committee requests the Department report on the feasibility 
of establishing a National Rural Health Behavioral Center to 
train extension agents nationwide to provide behavioral health 
services in rural areas. This report should include the cost of 
establishing a Center, and the annual cost to train extension 
agents.

                        Buildings and Facilities

1997 appropriation......................................     $61,591,000
1998 budget estimate....................................................
Provided in the bill....................................................
Comparison:
    1997 appropriation..................................     -61,591,000
    1998 budget estimate................................................

    The CSREES, Buildings and Facilities account was 
established for the acquisition of land, construction, repair, 
improvement, extension, alteration, and purchase of fixed 
equipment or facilities which directly or indirectly support 
research and extension programs of the Department.

                          Committee Provisions

    For Buildings and Facilities of the Cooperative State 
Research, Education, and Extension Service, the Committee 
provides no funding. In the fiscal year 1996 Conference Report 
104-268 accompanying Public Law 104-37, the Congress stated 
that funding for this account would be terminated after fiscal 
year 1997. Again in Conference Report 104-726 accompanying 
Public Law 104-180 the Congress stated that fiscal year 1997 
was the last year of funding for this program and that any 
project that was unfinished should obtain additional funding 
from other than Federal resources.
    The Committee strongly supports funding for the School of 
Forestry Building Complex at Auburn University. This facility 
will provide a state of the art teaching and research facility 
for Forestry Science at Auburn University to support and 
enhance the economic competitiveness of the forestry industry. 
The Committee recommends that up to $4.75 million be made 
available for this project.

Office of the Assistant Secretary for Marketing and Regulatory Programs

1997 appropriation......................................        $618,000
1998 budget estimate....................................         625,000
Provided in the bill....................................         618,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................          -7,000

    The Office of the Assistant Secretary for Marketing and 
Regulatory Programs provides direction and coordination in 
carrying out laws enacted by the Congress with respect to the 
Department's marketing, grading, and standardization activities 
related to grain; competitive marketing practices of livestock, 
marketing orders and various programs; veterinary services; and 
plant protection and quarantine. The Office has oversight and 
management responsibilities for the Animal and Plant Health 
Inspection Service; Agricultural Marketing Service; and Grain 
Inspection, Packers and Stockyards Administration.

                          Committee Provisions

    For the Office of the Assistant Secretary for Marketing and 
Regulatory Programs, the Committee provides an appropriation of 
$618,000, the same as the amount available for fiscal year 1997 
and a decrease of $7,000 below the budget request.

               Animal and Plant Health Inspection Service

                         Salaries and Expenses

                                                                                                                
                                                              Appropriation       User Fees       Total, APHIS  
                                                                                                                
1997 appropriation........................................      $336,909,000     ($98,000,000)    ($434,909,000)
1998 budget estimate......................................       324,491,000     (100,000,000)     (424,491,000)
Provided in the bill......................................       336,244,000      (88,000,000)     (424,244,000)
Comparison:                                                                                                     
    1997 appropriation....................................          -665,000     (-10,000,000)     (-10,665,000)
    1998 budget estimate..................................       +11,753,000     (-12,000,000)        (-247,000)
                                                                                                                
                                                                                                                

    The Animal and Plant Health Inspection Service (APHIS) was 
established by the Secretary of Agriculture on April 2, 1972 
under the authority of Reorganization Plan No. 2 of 1953 and 
other authorities. The major objectives of APHIS are to protect 
the animal and plant resources of the nation from diseases and 
pests. These objectives are carried out under the major areas 
of activity, as follows:
    Pest and Disease Exclusion.--The agency conducts inspection 
and quarantine activities at U.S. ports-of-entry to prevent the 
introduction of exotic animal and plant diseases and pests. The 
agency also participates in inspection, survey, and control 
activities in foreign countries to reinforce its domestic 
activities.
    Plant and Animal Health Monitoring.--The agency conducts 
programs to assess animal and plant health and to detect 
endemic and exotic diseases and pests.
    Pest and Disease Management Programs.--The agency carries 
out programs to control and eradicate pest infestations and 
animal diseases that threaten the United States; reduce 
agricultural losses caused by predatory animals, birds, and 
rodents; provide technical assistance to other cooperators such 
as states, counties, farmer or rancher groups, and foundations; 
and ensure compliance with interstate movement and other 
disease control regulations within the jurisdiction of the 
agency.
     Animal Care.--The agency conducts regulatory activities 
which ensure the humane care and treatment of animals and 
horses as required by the Animal Welfare and Horse Protection 
Acts. These activities include inspection of certain 
establishments which handle animals intended for research, 
exhibition, and as pets, and monitoring of certain horse shows.
    Scientific and Technical Services.--The agency performs 
other regulatory activities, including the development of 
standards for the licensing and testing of veterinary 
biologicals to ensure their safety and effectiveness; 
diagnostic activities in support of the control and eradication 
programs in other functional components; applied research aimed 
at reducing economic damage from vertebrate animals; 
development of new pest and animal damage control methods and 
tools; and regulatory oversight of genetically engineered 
products.
    Agricultural Quarantine Inspection.--User fees are 
collected to cover the cost of inspection and quarantine 
activities at U.S. ports of entry to prevent the introduction 
of exotic animal and plant diseases and pests.

                          committee provisions

    The following table reflects the amounts provided by the 
Committee:

                        ANIMAL AND PLANT HEALTH INSPECTION SERVICE--SALARIES AND EXPENSES                       
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                      FY 1997         FY 1998        Committee  
                          New Structure                               enacted        estimate       provisions  
----------------------------------------------------------------------------------------------------------------
Pest and Disease Exclusion:                                                                                     
    Agricultural quarantine inspection..........................         $26,547         $27,814         $26,547
    User fees...................................................          98,000         100,000          88,000
                                                                 -----------------------------------------------
        Subtotal, Agricultural quarantine inspection............         124,547         127,814         114,547
                                                                                                                
    Cattle ticks................................................           4,537           4,427           4,427
    Foot-and-mouth disease......................................           3,991           3,803           3,803
    Import-export inspection....................................           6,847           6,815           6,815
    International programs......................................           6,643           6,630           6,630
    Fruit fly exclusion and detection...........................          21,161          20,970          20,970
    Screwworm...................................................          31,713          31,335          31,335
    Tropical bont tick..........................................             452             444             444
                                                                 -----------------------------------------------
      Total, Pest and Disease Exclusion.........................         199,891         202,238         188,971
                                                                 ===============================================
Plant and Animal Health Monitoring:                                                                             
    Animal health monitoring and surveillance...................          60,831          60,564          61,064
    Animal and plant health regulatory enforcement..............           5,855           5,722           5,722
    Pest detection..............................................           4,202           8,732           6,202
                                                                 -----------------------------------------------
      Total, Plant and Animal Health Monitoring.................          70,888          75,018          72,988
                                                                 ===============================================
Pest and Disease Management Programs:                                                                           
    Animal damage control-operations............................          26,967          23,713          27,967
    Aquaculture.................................................             571             567             567
    Biocontrol..................................................           6,290           6,275           6,275
    Boll weevil.................................................          16,209           6,376          16,209
    Brucellosis eradication.....................................          21,661          19,818          19,818
    Golden nematode.............................................             444             435             435
    Gypsy moth..................................................           4,367           4,366           4,366
    Imported fire ant...........................................           1,000  ..............           1,000
    Miscellaneous plant diseases................................           1,516           1,533           1,516
    Noxious weeds...............................................             404             406             404
    Pink bollworm...............................................           1,069           1,048           1,048
    Pseudorabies................................................           4,518           4,481           4,481
    Scrapie.....................................................           2,967           2,931           2,931
    Sweet potato whitefly.......................................           1,888           1,877           1,877
    Tuberculosis................................................           4,948           4,920           4,920
    Witchweed...................................................           1,662           1,638           1,638
                                                                 -----------------------------------------------
      Total, Pest and Disease Management Programs...............          96,481          80,384          95,452
                                                                 ===============================================
Animal Care:                                                                                                    
    Animal welfare..............................................           9,185           9,175           9,175
    Horse protection............................................             360             353             353
                                                                 -----------------------------------------------
      Total, Animal Care........................................           9,545           9,528           9,528
                                                                 ===============================================
Scientific and Technical Services:                                                                              
    Animal damage control methods development...................          10,591           9,672          10,215
    Biotechnology/environmental protection......................           8,132           8,139           8,132
    Integrated systems acquisition..............................           4,000           4,000           3,500
    Plant methods development laboratories......................           5,048           5,102           5,048
    Veterinary biologics........................................          10,360          10,345          10,345
    Veterinary diagnostics......................................          15,473          15,622          15,622
                                                                 -----------------------------------------------
      Total, Scientific and Technical Services..................          53,604          52,880          52,862
                                                                 ===============================================
    Contingency fund............................................           4,500           4,443           4,443
                                                                 ===============================================
        Total, Salaries and Expenses............................        $434,909        $424,491        $424,244
----------------------------------------------------------------------------------------------------------------

    Agricultural Quarantine Inspection (AQI).--The Committee 
provides an appropriation of $88,000,000 for the agricultural 
quarantine inspection user fee program, a decrease of 
$10,000,000 below the amount available in fiscal year 1997 and 
a decrease of $12,000,000 below the budget request.
    Animal care.--The Committee urges APHIS to implement the 
regulations for the safe transportation of horses to 
slaughterhouse facilities.
    Animal Damage Control (ADC).--The Committee directs APHIS 
to assure, to the maximum extent possible, that all control 
activities be cost-shared with local sponsors. The Committee 
also expects APHIS to continue work related to blackbird damage 
control in Louisiana and North Dakota. The Committee provides 
an additional $1,000,000 for rabies control activities.
    Avocados.--APHIS is directed to provide the Committee with 
a monthly report on the pest infestation status of Mexican 
avocado orchards designated for export. The Committee also 
expects APHIS to provide an update on the protocol for 
importation. In addition, the Committee encourages APHIS to 
work with U.S. avocado growers in implementing procedures to 
meet phytosanitary standards.
    Imported Fire Ant.--The Committee supports the development 
of a program for the control, management, and eradication of 
the imported fire ant.
    Methods Development.--The Committee provides an increase of 
$350,000 for trap testing, development of best management 
practices, and related activities necessary to meet U.S. 
obligations under an international agreement for trap 
standards. The Committee expects that these activities will be 
conducted in full cooperation with state wildlife management 
agencies.
    National Farm Animal Identification and Records Project for 
Dairy Cattle.--The Committee provides an increase of $500,000 
for a National Farm Animal Identification and Records Project 
for Dairy Cattle to be coordinated with the Holstein 
Association.
    Pest Detection.--The Committee provides an additional 
$2,000,000 for the Karnal bunt program.
    Sanitary and Phytosanitary Standards.--The Committee 
expects that imported products will be subjected to the same 
sanitary and phytosanitary standards as domestic products and 
those that don't meet the U.S. standards will be rejected. 
APHIS should provide adequate staffing levels at the borders 
and ports of entry to ensure that sanitary and phytosanitary 
standards are upheld.

                        Buildings and Facilities

1997 appropriation......................................      $3,200,000
1998 budget estimate....................................       7,200,000
Provided in the bill....................................       3,200,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................      -4,000,000

    The APHIS Buildings and Facilities account funds major 
nonrecurring construction projects in support of specific 
program activities and recurring construction, alterations, 
preventive maintenance, and repairs of existing APHIS 
facilities.

                          Committee Provisions

    For Animal and Plant Health Inspection Service, Buildings 
and Facilities, the Committee provides an appropriation of 
$3,200,000, the same as the amount available for fiscal year 
1997 and a decrease of $4,000,000 below the budget request.

                     Agricultural Marketing Service

                           Marketing Services

1997 appropriation......................................     $38,507,000
1998 budget estimate....................................      49,786,000
Provided in the bill....................................      45,592,000
Comparison:
    1997 appropriation..................................      +7,085,000
    1998 budget estimate................................      -4,194,000

    The Agricultural Marketing Service (AMS) was established by 
the Secretary of Agriculture on April 2, 1972, under the 
authority of Reorganization Plan No. 2 of 1953, and other 
authorities. Through its marketing, consumer, and regulatory 
programs, AMS aids in advancing orderly and efficient marketing 
and effective distribution and transportation of products from 
the Nation's farms.
    Programs administered by this agency include the market 
news services, payments to states for marketing activities, the 
Plant Variety Protection Act, the Federal administration of 
marketing agreements and orders, standardization, grading, 
classing, and shell egg surveillance services, transportation 
services, and market protection and promotion.

                          Committee Provisions

    For Marketing Services of the Agricultural Marketing 
Service, the Committee provides an appropriation of 
$45,592,000, an increase of $7,085,000 above the amount 
available for fiscal year 1997 and a decrease of $4,194,000 
below the budget request. Included in this amount is $8,000,000 
for the Pesticide Data Program. The Committee also provides 
language to allow for the collection of fees for the 
development of standards.
    The Committee expects implementation of the Organic 
Certification Program to continue and that a final rule will be 
published in fiscal year 1998.

                 Limitation on Administrative Expenses

1997 limitation.........................................   ($59,012,000)
1998 budget limitation..................................    (59,521,000)
Provided in the bill....................................    (59,521,000)
Comparison:
    1997 limitation.....................................      (+509,000)
    1998 budget limitation...................(.........................)

    The Agricultural Marketing Service provides inspection, 
grading, and classing services to the cotton and tobacco 
industries on a user funded basis. The legislative authorities 
to carry out these programs are: the U.S. Cotton Standards Act; 
the Cotton Statistics and Estimates Act of 1927, as amended; 
the Tobacco Inspection Act; the Omnibus Budget Reconciliation 
Act of 1981; the Dairy and Tobacco Adjustment Act of 1985; and 
the Uniform Cotton Classing Fees Act of 1987. These programs 
facilitate the interstate and foreign commerce of these 
products. This is accomplished by inspecting, identifying, and 
certifying the quality of these products in accordance with 
official standards. Grades serve as a basis for prices and 
reflect the value of the products to the producer as well as 
the buyer. These programs facilitate the movement of 
commodities through marketing channels in a quick, efficient, 
and equitable manner.

                          Committee Provisions

    For a Limitation on Administrative Expenses of the 
Agricultural Marketing Service, the Committee provides 
$59,521,000, an increase of $509,000 above the amount available 
for fiscal year 1997 and the same amount as the budget request.

          Funds for Strengthening Markets, Income, and Supply

                              (Section 32)

1997 appropriation......................................     $10,576,000
1998 budget estimate....................................      10,690,000
Provided in the bill....................................      10,690,000
Comparison:
    1997 appropriation..................................        +114,000
    1998 budget estimate................................................

    The Act of August 24, 1935, appropriates 30 percent of all 
customs receipts for: (a) encouraging exports of agricultural 
commodities; (b) encouraging domestic consumption of 
agricultural commodities by diversion to alternative outlets or 
by increasing their utilization; and (c) reestablishing the 
farmers' purchasing power.
    The primary purpose of section 32 is to strengthen markets 
by purchasing surplus perishable agricultural commodities to 
encourage continued adequate production.
    The following table reflects the status of this fund for 
fiscal years 1996 through 1998:

         SECTION 32--ESTIMATED TOTAL FUNDS AVAILABLE AND BALANCE CARRIED FORWARD, FISCAL YEARS 1996-1998        
----------------------------------------------------------------------------------------------------------------
                                                                               FY 1997 current   FY 1998 current
                                                             FY 1996 actual       estimate          estimate    
----------------------------------------------------------------------------------------------------------------
Appropriation (30 percent of customs receipts)............    $6,263,764,062    $5,923,376,725    $5,799,067,890
    Less rescission.......................................        -5,000,000  ................  ................
Less transfers:                                                                                                 
    Food and Consumer Service.............................    -5,597,858,000    -5,433,753,000    -5,218,411,000
    Commerce Department...................................       -72,893,162       -66,381,020       -66,381,000
                                                           -----------------------------------------------------
      Total, transfers....................................    -5,670,751,162    -5,500,134,020    -5,284,792,000
                                                           =====================================================
Budget authority..........................................       588,012,900       423,242,705       581,295,890
Unobligated balance available, start of year..............       235,129,235       300,000,000       202,611,705
Recoveries of prior year obligations......................           739,082  ................  ................
                                                           -----------------------------------------------------
    Available for obligation..............................       823,881,217       723,242,705       783,907,595
Less obligations:                                                                                               
    Commodity procurement:                                                                                      
    Child nutrition purchases.............................       399,084,074       400,000,000       400,000,000
    Emergency surplus removal.............................        56,171,527       101,000,000  ................
    Diversion payments....................................  ................  ................  ................
    Disaster relief.......................................         1,167,904  ................  ................
    Sunflower and cottonseed oil purchase.................        23,900,000  ................  ................
                                                           -----------------------------------------------------
          Total, commodity procurement....................       480,323,505       501,000,000       400,000,000
                                                           =====================================================
Administrative funds:                                                                                           
    Commodity purchase service............................         5,733,351         6,155,000         6,198,000
    Marketing agreements and orders.......................        10,016,377        10,576,000        10,690,000
                                                           -----------------------------------------------------
      Total, administrative funds.........................        15,749,728        16,731,000        16,888,000
                                                           =====================================================
      Total, obligations..................................       496,073,233       517,731,000       416,888,000
                                                           =====================================================
      Carryout............................................       327,807,984       202,611,705       300,000,000
      Return to Treasury..................................        27,807,984  ................  ................
                                                           =====================================================
      Unobligated balance available, end of year..........      $300,000,000      $205,511,705      $300,000,000
----------------------------------------------------------------------------------------------------------------

                          Committee Provisions

    For the Marketing Agreements and Orders Program, the 
Committee provides a transfer from section 32 funds of 
$10,690,000, an increase of $114,000 above the amount available 
for fiscal year 1997 and the same amount as the budget request.

                   Payments to States and Possessions

1997 appropriation......................................      $1,200,000
1998 budget estimate....................................       1,200,000
Provided in the bill....................................       1,200,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................................

    The Federal-State Marketing Improvement Program is 
authorized by section 204(b) of the Agricultural Marketing Act 
of 1946 and is also funded from appropriations. Payments are 
made to state marketing agencies to: identify and test market 
alternative farm commodities; determine methods of providing 
more reliable market information; and develop better commodity 
grading standards. This program has made possible many types of 
projects, such as electronic marketing and agricultural product 
diversification. Current projects are focused on the 
improvement of marketing efficiency and effectiveness, and 
seeking new outlets for existing farm produced commodities. The 
legislation grants the U.S. Department of Agriculture authority 
to establish cooperative agreements with State Departments of 
Agriculture or similar state agencies to improve the efficiency 
of the agricultural marketing chain. The states perform the 
work or contract it to others, and must contribute at least 
one-half of the cost of the projects.

                          Committee Provisions

    For Payments to States and Possessions, the Committee 
provides an appropriation of $1,200,000, the same as the amount 
available for fiscal year 1997 and the same as the budget 
request.

        Grain Inspection, Packers and Stockyards Administration

                         Salaries and Expenses

1997 appropriation......................................     $23,128,000
1998 budget estimate....................................      25,722,000
Provided in the bill....................................      23,928,000
Comparison:
    1997 appropriation..................................        +800,000
    1998 budget estimate................................      -1,794,000

    The Grain Inspection, Packers and Stockyards Administration 
(GIPSA) was established pursuant to the Secretary's 1994 
reorganization. Grain inspection and weighing programs are 
carried out under the U.S. Grain Standards Act and other 
programs under the authority of the Agricultural Marketing Act 
of 1946, including the inspection and grading of rice and 
grain-related products; conducting official weighing and grain 
inspection activities; and grading dry beans and peas, and 
processed grain products. Under the Packers and Stockyards Act, 
assurance of the financial integrity of the livestock, meat, 
and poultry markets is provided. The Administration monitors 
competition in order to protect producers, consumers, and 
industry from deceptive and fraudulent practices which affect 
meat and poultry prices.

                          Committee Provisions

    For Grain Inspection, Packers and Stockyards 
Administration, the Committee provides an appropriation of 
$23,928,000, an increase of $800,000 above the amount available 
for fiscal year 1997 and a decrease of $1,794,000 below the 
budget request. The Committee provides $800,000 for packer 
concentration activities.

        Limitation on Inspection and Weighing Services Expenses

1997 limitation.........................................   ($43,207,000)
1998 budget limitation..................................    (43,092,000)
Provided in the bill....................................    (43,092,000)
Comparison:
    1997 limitation.....................................      (-115,000)
    1998 budget limitation...................(.........................)

    The U.S. Grain Standards Act requires, with minor 
exceptions, that all grain exported by grade must be officially 
inspected and weighed. The agency's employees or delegated 
state agencies perform original inspection and weighing 
services at export port locations in the United States and 
Canada. Grain which is not being exported may be inspected at 
interior locations, upon request, by licensed employees of 
designated state and private agencies. The agency's employees, 
upon request, perform domestic original inspection and weighing 
services on grain, oilseeds, pulses, rice, and related grain 
commodities. The agency's employees supervise and provide 
oversight for inspectors performing official services.

                          committee provisions

    The Committee includes a limitation on inspection and 
weighing services expenses of $43,092,000, a decrease of 
$115,000 below the amount available for fiscal year 1997 and 
the same as the budget request. The bill includes authority to 
exceed by 10 percent the limitation on inspection and weighing 
services with notification to the Appropriations Committees. 
This allows for flexibility if export activities require 
additional supervision and oversight or other uncontrollable 
factors occur.

             Office of the Under Secretary for Food Safety

1997 appropriation......................................        $446,000
1998 budget estimate....................................         583,000
Provided in the bill....................................         446,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................        -137,000

    The Office of the Under Secretary for Food Safety provides 
direction and coordination in carrying out the laws enacted by 
the Congress with respect to the Department's inspection of 
meat, poultry, and egg products. The Office has oversight and 
management responsibilities for the Food Safety and Inspection 
Service.

                          Committee Provisions

    For the Office of the Under Secretary for Food Safety, the 
Committee provides an appropriation of $446,000, the same as 
the amount available for fiscal year 1997 and a decrease of 
$137,000 below the budget request. The Under Secretary for Food 
Safety has one agency to administer--the Food Safety and 
Inspection Service (FSIS). Although the position of Under 
Secretary has been vacant for nearly three years, FSIS has 
continued to deal with a wide array of complex and critical 
food safety issues including implementation of the largest 
change in meat and poultry inspection procedure since Federal 
inspection began.

                   Food Safety and Inspection Service

1997 appropriation......................................    $574,000,000
1998 budget estimate....................................     591,209,000
Provided in the bill....................................     589,263,000
Comparison:
    1997 appropriation..................................     +15,263,000
    1998 budget estimate................................      -1,946,000

    The Food Safety and Inspection Service was established on 
June 17, 1981, by Secretary's Memorandum No. 1000-1, issued 
pursuant to Reorganization Plan No. 2 of 1953.
    The major objectives of the Service are to assure that meat 
and poultry products are wholesome, unadulterated, and properly 
labeled and packaged, as required by the Federal Meat 
Inspection Act and the Poultry Products Inspection Act; provide 
continuous in-plant inspection to egg processing plants under 
the Egg Products Inspection Act; and administer the pathogen 
reduction program.
    The inspection program of the Food Safety and Inspection 
Service provides continuous in-plant inspection of all domestic 
plants preparing meat, poultry, or egg products for sale or 
distribution; reviews foreign inspection systems and 
establishments that prepare meat or poultry products for export 
to the United States; and provides technical and financial 
assistance to states which maintain meat and poultry inspection 
programs.

                          Committee Provisions

    For the Food Safety and Inspection Service, the Committee 
provides an appropriation of $589,263,000, an increase of 
$15,263,000 above the amount available for fiscal year 1997 and 
a decrease of $1,946,000 below the budget request.
    The Committee continues to regard the inspection of the 
Nation's meat and poultry supply as one of the highest 
priorities for funding in the USDA budget. The small decrease 
in funding for fiscal year 1998 reflects the Committee's belief 
that the pilot projects for dairy herd and other animal 
identification are better carried out by the Animal and Plant 
Health Inspection Service.
    The Committee notes that at the beginning of the year the 
Administration proposed user fees totaling $390,000,000, or 
nearly 70 percent of the FSIS budget, for meat and poultry 
inspection. As of June 25, the Administration has failed to 
submit the required authorizing legislation to Congress. The 
Committee believes that if the Administration is serious about 
securing user fees for funding of the national meat inspection 
program, it should develop plans to justify to Congress, 
industry, and consumers the reason for this major change in 
policy.
    The Committee directs the Department to work with the 
Centers for Disease Control and Prevention and any other 
appropriate agency to provide the House and Senate Committees 
on Appropriations an annual report on the incidence of 
foodborne illnesses in the United States. The report should be 
submitted with the annual request for funding for the Food 
Safety and Inspection Service.
    The Committee notes the increased consumption of ratite 
meat in the United States and that the inspection of these 
meats is done on a voluntary basis by producers and processors. 
The Committee directs FSIS to develop a cost benefit analysis 
of the impact of including ratite meats in the mandatory 
inspection program by February 1, 1998.
    The Committee commends the Administration's efforts to 
better coordinate the resources of the various food inspection 
agencies in the Federal government and urges the Administration 
to proceed with the development of a single food inspection 
agency to maximize consumer protection and the efficient use of 
scarce government resources.
    The bill includes language requiring the Department of 
Agriculture to publish a final rule governing the storage and 
transportation of shell eggs. Since 1991, Congress and the egg 
production industry have asked the Department to publish such a 
rule. The Egg Products Inspection Amendments of 1991 contained 
such a requirement. However, after nearly six years since the 
passage of that legislation, the Department has not published a 
final rule. The Committee believes that the Department has 
ignored the best interests of consumers and industry for no 
reason other than bureaucratic inertia. The bill language, 
therefore, withholds $5,000,000 of funds appropriated to FSIS 
until a final rule is implemented to prescribe the temperature 
at which eggs are maintained.

                        FARM ASSISTANCE PROGRAMS

    Office of the Under Secretary for Farm and Foreign Agricultural 
                                Services

1997 appropriation......................................        $572,000
1998 budget estimate....................................         580,000
Provided in the bill....................................         572,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................          -8,000

    The Office of the Under Secretary for Farm and Foreign 
Agricultural Services provides direction and coordination in 
carrying out the laws enacted by the Congress with respect to 
the Department's international affairs (except for foreign 
economic development) and commodity programs. The Office has 
oversight and management responsibilities for the Farm Service 
Agency (which includes the Commodity Credit Corporation), the 
Risk Management Agency, and the Foreign Agricultural Service.

                          Committee Provisions

    For the Office of the Under Secretary for Farm and Foreign 
Agricultural Services, the Committee provides an appropriation 
of $572,000, the same as the amount available for fiscal year 
1997 and a decrease of $8,000 below the budget request.

                          Farm Service Agency

    The Farm Service Agency (FSA) was established by the 
Department of Agriculture Reorganization Act of 1994, P.L. 103-
354, enacted October 13, 1994. Originally called the 
Consolidated Farm Service Agency, the name was changed to the 
Farm Service Agency on November 8, 1995. The FSA administers 
the agricultural commodity programs financed by the Commodity 
Credit Corporation (CCC); the warehouse examination function; 
the conservation reserve program (CRP); several other 
conservation cost-share programs; the Noninsured Crop Disaster 
Assistance Program (NAP); and farm ownership, operating, 
emergency disaster, and other loan programs.
    Agricultural market transition program.--The Federal 
Agriculture Improvement and Reform Act of 1996, P.L. 104-127 
(1996 Act), enacted April 4, 1996, mandates that the Secretary 
offer individuals with eligible cropland acreage the 
opportunity for a one-time signup in a 7-year, production 
flexibility contract. Depending on each contract, a 
participant's prior contract-crop acreage history and payment 
yield, as well as total program participation, each contract 
participant shares a portion of a statutorily-specified annual 
dollar amount. In return, participants must comply with certain 
requirements regarding land conservation, wetland protection, 
planting flexibility, and agricultural use. Contract crops, for 
the purposes of determining eligible cropland and payments, 
include wheat, corn, grain sorghum, barley, oats, upland 
cotton, and rice. This program does not include any production 
adjustment requirements or related provisions except for 
restrictions on the planting of fruits and vegetables.
    Marketing assistance loan program, price support programs, 
and other loan and related programs.--The 1996 Act provides for 
marketing assistance loans to producers of contract 
commodities, extra long staple (ELS) cotton, and oilseeds for 
the 1996 through 2002 crops. With the exception of ELS cotton, 
these nonrecourse loans are characterized by loan repayment 
rates that may be determined to be less than the principal plus 
accrued interest per unit of the commodity. Producers have the 
option of taking a loan deficiency payment, if available, in 
lieu of the marketing assistance loan.
    The 1996 Act also provides for a loan program for sugar for 
the 1996 through 2002 crops of sugar beets and sugarcane, where 
the loans may be either recourse or nonrecourse in nature 
depending on the level of the tariff rate quota for imports of 
sugar. The 1996 Act provides for a milk price support program, 
whereby the price of milk is supported through December 31, 
1999, via purchases of butter, cheese, and nonfat dry milk. The 
rate of support is fixed each calendar year, starting at $10.35 
per hundredweight in 1996 and declining each year to $9.90 per 
hundredweight in 1999. Beginning January 1, 2000, the 1996 Act 
provides a recourse loan program for commercial processors of 
dairy products. The 1996 Act and the 1938 Act provide for a 
peanut loan and poundage quota program for the 1996 through 
2002 crops of peanuts. Finally, the Agricultural Act of 1949, 
as amended (1949 Act), and the 1938 Act provide for a price 
support, quota, and allotment program for tobacco.
    The interest rate on commodity loans secured on or after 
October 1, 1996, will be one percentage point higher than the 
formula which was used to calculate commodity loans secured 
prior to fiscal year 1997. The CCC monthly commodity loan 
interest rate will, in effect, be one percentage point higher 
than CCC's cost-of-money for that month.
    The 1996 Act amended the payment limitation provisions in 
the Food Security Act of 1985, as amended (1985 Act), by 
changing the annual $50,000 payment limit per person for 
deficiency and diversion payments to an annual $40,000 payment 
limit per person for contract payments. The annual $75,000 
payment limit per person applicable to combined marketing loan 
gains and loan deficiency payments for all commodities that was 
in effect for the 1991 through 1995 crop years continues 
through the 2002 crop year. Similarly, the 3-entity rule is 
continued.
    Commodity Credit Corporation program activities.--Various 
price support and related programs have been authorized in 
numerous legislative enactments since the early 1930's. 
Operations under these programs are financed through the 
Commodity Credit Corporation. Personnel and facilities of the 
Farm Service Agency (FSA) are utilized in the administration of 
the Commodity Credit Corporation, and the Administrator of the 
FSA is also Executive Vice President of the Corporation.
    The 1996 Act created new conservation programs to address 
high priority environmental protection goals and authorizes CCC 
funding for many of the existing and new conservation programs. 
The Natural Resources Conservation Service administers many of 
the programs financed through the CCC.
    Foreign assistance programs and other special activities.--
Various surplus disposal programs and other special activities 
are conducted pursuant to the specific statutory authorizations 
and directives. These laws authorize the use of CCC funds and 
facilities to implement the programs. Appropriations for these 
programs are transferred or paid to the Corporation for its 
costs incurred in connection with these activities, such as 
Public Law 480.
    Farm credit programs.--The Department's reorganization has 
placed the farm credit programs under FSA and is designed to 
facilitate improved coordination between the credit programs 
and FSA's risk management, conservation, and commodity support 
programs. FSA reviews applications, makes and collects loans, 
and provides technical assistance and guidance to borrowers. 
Under credit reform, administrative costs associated with 
Agricultural Credit Insurance Fund (ACIF) loans are 
appropriated to the ACIF Program Account and transferred to FSA 
salaries and expenses.
    Risk management.--Includes the Noninsured Crop Disaster 
Assistance Program (NAP) which provides crop loss protection 
for growers of many crops for which crop insurance is not 
available.

                         Salaries and Expenses

                                                                                                                
                                                                              Transfer from                     
                                                             Appropriation   program accts.     Total, FSA, S&E 
                                                                                                                
1997 appropriation........................................    $746,440,000    ($209,780,000)      ($956,220,000)
1998 budget estimate......................................     742,789,000     (211,324,000)       (954,113,000)
Provided in the bill......................................     702,203,000     (209,780,000)       (911,983,000)
Comparison:                                                                                                     
    1997 appropriation....................................     -44,237,000  (...............                    
                                                                                      .....)       (-44,237,000)
    1998 budget estimate..................................     -40,586,000      (-1,544,000)       (-42,130,000)
                                                                                                                

                          Committee Provisions

    For salaries and expenses of the Farm Service Agency (FSA), 
the Committee provides an appropriation of $702,203,000 and 
transfers from other accounts of $209,780,000, for a total 
program level of $911,983,000, a decrease of $44,237,000 below 
the amount available for fiscal year 1997 and $42,130,000 below 
the budget request.
    During hearings before the Committee the Secretary stated 
that the Department had no plans to close more field offices 
than were in the original 1994 consolidation plan considered 
and approved by Congress. With the funds provided, the 
Committee expects the Department to continue operating under 
this plan and expects the Secretary to consult with Congress 
prior to any further field office consolidations.
    The Committee continues to support the Conservation Reserve 
Program and believes that CRP is essential to protecting and 
improving highly erodible lands, water quality, air quality, 
and wildlife habitat. The Committee believes that such benefits 
can be enhanced by emphasizing greater reliance on the National 
Buffer Strip Initiative and the use of Conservation Reserve 
Enhancement Program (CREP) initiatives. The Committee expects 
the Secretary to offer incentive payment rates on all practices 
eligible for the continuous sign-up, including in-field 
practices. The Committee further urges the Secretary to 
consider adjusting rental rates for partial field enrollments 
where necessary to ensure adequate, nationwide participation. 
Riparian rangeland should be eligible for program 
participation, the inclusion of which will help preserve 
environmentally sensitive lands and allow for greater 
geographic diversity among program participants. The Committee 
expects the Secretary to further emphasize the use of the 
National Buffer Strip Initiative and CREP in regions where PM-
10 threatens population centers as a result of wind erosion. 
The Committee urges the Secretary to factor these 
considerations into the future administration of the CRP.

                         state mediation grants

1997 appropriation......................................      $2,000,000
1998 budget estimate....................................       4,000,000
Provided in the bill....................................       2,000,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................      -2,000,000

    This program is authorized under title V of the 
Agricultural Credit Act of 1987. Grants are made to states 
which have been certified by FSA as having an agricultural loan 
mediation program. Grants will be solely for operation and 
administration of the state's agricultural loan mediation 
program.

                          Committee Provisions

    For State Mediation Grants, the Committee provides an 
appropriation of $2,000,000, the same as the amount available 
in fiscal year 1997 and a decrease of $2,000,000 below the 
budget request.

                        Dairy Indemnity Program

1997 appropriation......................................        $100,000
1998 budget estimate....................................         100,000
Provided in the bill....................................         350,000
Comparison:
    1997 appropriation..................................        +250,000
    1998 budget estimate................................        +250,000

    Under the program, the Department makes indemnification 
payments to dairy farmers and manufacturers of dairy products 
who, through no fault of their own, suffer losses because they 
are directed to remove their milk from commercial markets due 
to contamination of their products by registered pesticides. 
The program also authorizes indemnity payments to dairy farmers 
for losses resulting from the removal of cows or dairy products 
from the market due to nuclear radiation or fallout.

                          Committee Provisions

    For the Dairy Indemnity Program, the Committee provides an 
appropriation of $350,000, an increase of $250,000 above amount 
available for fiscal year 1997 and an increase of $250,000 
above the budget request.

           agricultural credit insurance fund program account

    Farm Ownership Loans.--Makes loans to farmers and ranchers 
for acquiring, enlarging, or improving farms, including farm 
buildings, land development, use, and conservation, refinancing 
indebtedness, and for loan closing costs.
    Operating Loans.--Makes loans to farmers and ranchers for 
costs incident to reorganizing a farming system for more 
profitable operations, for a variety of essential farm 
operating expenses such as purchase of livestock, farm 
equipment, feed, seed, fertilizer, and farm supplies; for 
refinancing land and water development, use, and conservation; 
for refinancing indebtedness; for other farm and home needs; 
and for loan closing costs.
    Emergency Loans.--Makes loans in designated areas where a 
natural disaster has caused a general need for agricultural 
credit which cannot be met for limited periods of time by 
private cooperatives or other responsible sources.
    Indian Tribe Land Acquisition Loans.--Makes loans to any 
Indian tribe recognized by the Secretary of the Interior or 
tribal corporation established pursuant to the Indian 
Reorganization Act, which does not have adequate uncommitted 
funds, to acquire lands or interest in lands within the tribe's 
reservation or Alaskan Indian community, as determined by the 
Secretary of the Interior, for use of the tribe or the 
corporation or the members thereof.
    Credit Sales of Acquired Property.--Makes loans in 
conjunction with the sale of security properties previously 
acquired during the servicing of its loan portfolio.
    Boll Weevil Eradication Loans.--Makes loans to assist 
foundations in financing the operation of boll weevil 
eradication programs provided to farmers.

                         estimated loan levels

1997 loan level.........................................($3,080,724,000)
1998 budget estimate.................................... (2,831,828,000)
Provided in the bill.................................... (2,852,114,000)
Comparison:
    1997 loan level.....................................  (-228,610,000)
    1998 budget estimate................................   (+20,286,000)

Note.--Public Law 104-180 provided supplemental 1996 appropriations of 
$32,244,000 to support an emergency disaster loan level of $110,000,000. 
These funds are not reflected here.

    This fund makes the following loans to individuals: farm 
ownership, farm operating, soil and water, recreation, and 
emergency. In addition, the fund makes loans to associations 
for irrigation and drainage, grazing, recreation facilities, 
Indian tribe land acquisition, watershed protection, flood 
prevention, and resource conservation and development.

                          committee provisions

    Approximate loan levels provided by the Committee for 
fiscal year 1998 for the agricultural credit insurance fund 
programs are: $430,828,000 for farm ownership loans, of which 
$30,828,000 is for direct loans and $400,000,000 is for 
guaranteed loans; $2,341,701,000 for farm operating loans, of 
which $450,000,000 is for direct loans, $191,701,000 is for 
guaranteed subsidized loans, and $1,700,000,000 is for 
guaranteed unsubsidized loans; $500,000 for Indian tribe land 
acquisition loans; $25,000,000 for emergency disaster loans; 
$34,653,000 for boll weevil eradication loans; and $19,432,000 
for credit sales of acquired property.

                      agriculture credit programs

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                                      FY 1998        Committee  
                                                                   FY 1997 level     estimate       provisions  
----------------------------------------------------------------------------------------------------------------
Farm loan programs:                                                                                             
Farm ownership:                                                                                                 
    Direct......................................................       ($50,000)       ($30,828)       ($30,828)
    Guaranteed..................................................       (550,000)       (400,000)       (400,000)
Farm operating:                                                                                                 
    Direct......................................................       (495,071)       (450,000)       (450,000)
    Unsubsidized guaranteed.....................................     (1,700,000)     (1,700,000)     (1,700,000)
    Subsidized guaranteed.......................................       (200,000)       (200,000)       (191,701)
Emergency disaster..............................................        (25,000)        (25,000)        (25,000)
Indian tribe land acquisition...................................         (1,000)         (1,000)           (500)
Credit sales of acquired property...............................        (25,000)        (25,000)        (19,432)
Boll Weevil Eradication.........................................        (34,653)  ..............        (34,653)
                                                                 -----------------------------------------------
      Total, farm loans.........................................    ($3,080,724)    ($2,831,828)    ($2,852,114)
----------------------------------------------------------------------------------------------------------------

       estimated loan subsidy and administrative expenses levels

                                                                                                                
                                                                 Direct loan    Guaranteed loan   Administrative
                                                                   subsidy          subsidy          expenses   
                                                                                                                
1997 appropriation...........................................      $80,818,000      $59,745,000     $221,046,000
1998 budget estimate.........................................       42,980,000       54,610,000      219,861,000
Provided in the bill.........................................       42,689,000       53,130,000      218,446,000
Comparison:                                                                                                     
    1997 appropriation.......................................      -38,129,000       -6,615,000       -2,600,000
    1998 budget estimate.....................................         -291,000       -1,480,000       -1,415,000
                                                                                                                

    The Federal Credit Reform Act of 1990 established the 
Program Account. Appropriations to this account will be used to 
cover the lifetime subsidy costs associated with the direct 
loans obligated and loan guarantees committed in 1998, as well 
as for administrative expenses.

                          committee provisions

    The following table reflects the costs of loan programs 
under credit reform:

----------------------------------------------------------------------------------------------------------------
                                                                                                    Committee   
                                                             FY 1997 enacted  FY 1998 estimate     provisions   
----------------------------------------------------------------------------------------------------------------
Loan subsidies:                                                                                                 
  Farm ownership:                                                                                               
    Direct................................................        $5,920,000        $4,020,000        $4,020,000
    Guaranteed............................................        22,055,000        15,440,000        15,440,000
                                                           -----------------------------------------------------
      Subtotal............................................        27,975,000        19,460,000        19,460,000
                                                           =====================================================
  Farm operating:                                                                                               
    Direct................................................        65,450,000        29,565,000        29,565,000
    Guaranteed unsubsidized...............................        19,210,000        19,890,000        19,210,000
    Guaranteed subsidized.................................        18,480,000        19,280,000        18,480,000
                                                           -----------------------------------------------------
      Subtotal............................................       103,140,000        68,735,000        67,255,000
                                                           =====================================================
Boll weevil eradication...................................           499,000  ................           500,000
Indian tribe land acquisition.............................            54,000           132,000            66,000
Emergency disaster........................................         6,365,000         6,008,000         6,008,000
Credit sales of acquired property.........................         2,530,000         3,255,000         2,530,000
                                                           -----------------------------------------------------
    Total, Loan subsidies.................................       140,563,000        97,590,000        95,819,000
                                                           =====================================================
ACIF expenses:                                                                                                  
  Salaries and expenses...................................       208,446,000       209,861,000       208,446,000
  Administrative expenses.................................        12,600,000        10,000,000        10,000,000
                                                           -----------------------------------------------------
    Total, ACIF expenses..................................      $361,609,000      $317,451,000      $314,265,000
----------------------------------------------------------------------------------------------------------------

                         Risk Management Agency

1997 appropriation......................................     $64,000,000
1998 budget estimate....................................     271,036,000
Provided in the bill....................................     253,571,000
Comparison:
    1997 appropriation..................................    +189,571,000
    1998 budget estimate................................     -17,465,000

    Under the Federal Agriculture Improvement and Reform (FAIR) 
Act of 1996, Risk Management became an agency of the Department 
of Agriculture, known as the Risk Management Agency (RMA), 
reporting to the Under Secretary for Farm and Foreign 
Agricultural Services.
    RMA manages program activities in support of the Federal 
crop insurance program as authorized by the Federal Crop 
Insurance Reform and Department of Agriculture Reorganization 
Act of 1994 and the FAIR Act of 1996. Functional areas of RMA 
are research and development, insurance services, and 
compliance whose functions include policy formulation and 
procedures and regulations development. Reviews and evaluations 
are conducted for overall performance to ensure the actuarial 
soundness of the insurance program.

                          committee provisions

    For the Risk Management Agency, the Committee provides an 
appropriation of $253,571,000, an increase of $189,571,000 
above the amount available for fiscal year 1997 and a decrease 
of $17,465,000 below the budget request. The amount includes an 
increase of $1,000,000 for compliance activities in the Kansas 
City office and $188,571,000 for crop insurance sales 
commissions. The amount for sales commissions represents the 
amount the Administration proposed to allow for a reduced 
commissions base. It should be noted that the budget request 
stated legislation addressing a fluctuating commission rate 
would be proposed and as of June 25, this proposal had not yet 
been submitted to Congress.
    The 1994 Crop Insurance Reform Bill required the Risk 
Management Agency to reduce its paperwork requirements 
particularly those related to reinsurance companies. To date, 
there has been little, if any, effort to reduce paperwork and 
other costs. The Committee expects the agency to report to the 
appropriate Committees of Congress on its efforts in this 
regard and the report should include a review of its regional 
office structure and potential for consolidation of those 
offices.
    Currently the Risk Management Agency only offers revenue 
insurance coverage for the basic commodities. Lack of similar 
insurance products for other crops puts some diversified 
farming operations at a disadvantage. The Committee expects the 
Risk Management Agency to consider the feasibility of providing 
revenue insurance products for all crops.

                              Corporations

                Federal Crop Insurance Corporation Fund

1997 appropriation....................................\1\ $1,785,013,000
1998 budget estimate...................................\1\ 1,584,135,000
Provided in the bill....................................   1,584,135,000
Comparison:
    1997 appropriation..................................    -200,878,000
    1998 budget estimate................................................

\1\ Estimated amounts. The 1997 appropriations bill provided such sums 
as may be necessary to administer the program. The FY 1998 proposed 
appropriation will do the same.

     The Federal Crop Insurance Reform and Department of 
Agriculture Reorganization Act of 1994 was designed to replace 
the combination of crop insurance and ad hoc disaster payment 
programs with a strengthened crop insurance program.
    Producers of insurable crops are eligible to receive a 
basic level of protection against catastrophic losses, which 
cover 50 percent of the normal yield at 60 percent of the 
expected price. The only cost to the producer is an 
administrative fee of $50 per policy, or $200 for all crops 
grown by the producer in a county, with a cap of $600 
regardless of the number of crops and counties involved. At 
least catastrophic (CAT) coverage was required for producers 
who participate in the commodity support, farm credit, and 
certain other farm programs. This coverage was available either 
through FSA local offices or private insurance companies. Under 
the Federal Agriculture Improvement and Reform (FAIR) Act of 
1996, producers have the option of waiving their eligibility 
for emergency crop loss assistance instead of obtaining CAT 
coverage required to meet program requirements. Emergency loss 
assistance does not include emergency loans or payment under 
the noninsured assistance program (NAP), which is administered 
by FSA. Beginning with the 1997 crop, the Secretary began 
phasing out delivery of CAT coverage through the FSA offices, 
except in those areas where there are insufficient private 
insurance providers.
    The Reform Act of 1994 also provided increased subsidies 
for additional ``buy-up'' coverage levels which producers may 
obtain from private insurance companies. The amount of subsidy 
is equivalent to the amount of premium established for 
catastrophic risk protection coverage and an amount for 
operating and administrative expenses for coverage up to 65 
percent at 100 percent price. For coverage equal to or greater 
than 65 percent at 100 percent of the price, the amount is 
equivalent to an amount equal to the premium established for 50 
percent loss in yield indemnified at 75 percent of the expected 
market price and an amount of operating and administrative 
expenses.
    The reform legislation included the NAP program for 
producers of crops for which there is currently no insurance 
available. NAP was established to ensure that most producers of 
crops not yet insurable will have protection against crop 
catastrophes comparable to protection previously provided by ad 
hoc disaster assistance programs. While the NAP program was 
implemented under the Deputy Administrator for Risk Management, 
under the FAIR Act of 1996, the NAP program will remain with 
the FSA and has been incorporated into the Commodity Credit 
Corporation program activities.

                          Committee Provisions

    For the Federal Crop Insurance Corporation Fund, the 
Committee provides an appropriation of such sums as may be 
necessary, the same as the budget request.

                   Commodity Credit Corporation Fund

     The Corporation was organized on October 17, 1933, under 
the laws of the State of Delaware, as an agency of the United 
States, and was managed and operated in close affiliation with 
the Reconstruction Finance Corporation. On July 1, 1939, it was 
transferred to the Department of Agriculture by the President's 
Reorganization Plan No. 1. On July 1, 1948, it was established 
as an agency and instrumentality of the United States under a 
permanent Federal charter by Public Law 80-806, as amended. Its 
operations are conducted pursuant to this charter and other 
specific legislation.
    The Commodity Credit Corporation engages in buying, 
selling, lending, and other activities with respect to 
agricultural commodities, their products, food, feed, and 
fibers. Its purposes include stabilizing, supporting, and 
protecting farm income and prices; maintaining the balance and 
adequate supplies of selected commodities; and facilitating the 
orderly distribution of such commodities. In addition, the 
Corporation also makes available materials and facilities 
required in connection with the storage and distribution of 
such commodities. The Corporation also disburses funds for 
sharing of costs with producers for the establishment of 
approved conservation practices on environmentally sensitive 
land and subsequent rental payments for such land for the 
duration of conservation reserve program contracts.
    Activities of the Corporation are primarily governed by the 
following statutes: the Commodity Credit Corporation Charter 
Act, as amended; the Federal Agriculture Improvement and Reform 
Act of 1996, P.L. 104-127 (1996 Act), enacted April 4, 1996; 
the Agricultural Act of 1949, as amended (1949 Act); the 
Agricultural Adjustment Act of 1938, as amended (1938 Act); and 
the Food Security Act of 1985, as amended (1985 Act).
    The 1996 Act requires that the following programs be 
offered for the 1996 through 2002 crops: seven-year production 
flexibility contracts for contract commodities (wheat, feed 
grains, upland cotton, and rice); nonrecourse marketing 
assistance loans for contract commodities, extra long staple 
(ELS) cotton, and oilseeds; a nonrecourse loan program for 
peanuts; and a nonrecourse/recourse loan program for sugar. The 
1996 Act also requires a milk price support program that begins 
after enactment of the Act and continues through December 31, 
1999, followed by a recourse loan program for dairy product 
processors.
    The 1996 Act establishes the environmental conservation 
acreage reserve program (ECARP), which encompasses the 
conservation reserve program (CRP), the wetlands reserve 
program (WRP), and the environmental quality incentives program 
(EQIP). Each of these programs is funded through the 
Corporation.
    The 1996 Act also authorizes other new Corporation funded 
conservation programs, including the conservation farm option; 
flood risk reduction contracts; wildlife habitat incentives, 
and farmland protection programs.
    The Corporation is managed by a board of directors 
appointed by the President and confirmed by the Senate, subject 
to the general supervision and direction of the Secretary of 
Agriculture, who is ex officio, a director, and chairman of the 
board. The board consists of six members, in addition to the 
Secretary, who are designated according to their positions in 
the Department of Agriculture.
    Personnel and facilities of the Farm Service Agency, FSA 
state and county committees, and other USDA agencies are used 
to carry out Corporation activities.
    The Corporation has an authorized capital stock of $100 
million held by the United States and authority to borrow up to 
$30 billion. The fiscal year 1988 Appropriations Act, P.L. 100-
202, increased the statutory borrowing authority from $25 
billion to $30 billion. Funds are borrowed from the Federal 
Treasury and may also be borrowed from private lending 
agencies.
    The specific powers (15 U.S.C. 714c) of the Commodity 
Credit Corporation are as follows:
    In the fulfillment of its purposes and in carrying out its 
annual budget programs submitted to and approved by the 
Congress pursuant to chapter 91 of title 31, the Corporation is 
authorized to use its general powers only to--
          (a) Support the price of agricultural commodities 
        through loans, purchases, payments, and other 
        operations.
          (b) Make available materials and facilities required 
        in connection with the production and marketing of 
        agricultural commodities.
          (c) Procure agricultural commodities for sale to 
        other government agencies, foreign governments, and 
        domestic, foreign or international relief or 
        rehabilitation agencies, and to meet domestic 
        requirements.
          (d) Remove and dispose of or aid in the removal or 
        disposition of surplus agricultural commodities.
          (e) Increase the domestic consumption of agricultural 
        commodities by expanding or aiding in the expansion of 
        domestic markets or by developing or aiding in the 
        development of new and additional markets, marketing 
        facilities, and use for such commodities.
          (f) Export or cause to be exported, or aid in the 
        development of foreign markets for agricultural 
        commodities.
          (g) Carry out such other operations as the Congress 
        may specifically authorize or provide.

                 Reimbursement for Net Realized Losses

1997 appropriation......................................  $1,500,000,000
1998 budget estimate.................................... \1\ 783,507,000
Provided in the bill....................................     783,507,000
Comparison:
    1997 appropriation..................................    -716,493,000
    1998 budget estimate................................................

\1\ Amount proposed to be reimbursed through a current, indefinite 
appropriation.

    If necessary to perform the functions, duties, obligations, 
or commitments of the Commodity Credit Corporation, 
administrative personnel and others serving the Corporation 
shall be paid from funds on hand or from those funds received 
from the redemption or sale of commodities. Such funds shall 
also be available to meet program payments, commodity loans, or 
other obligations of the Corporation.

                          Committee Provisions

    For Reimbursement for Net Realized Losses to the Commodity 
Credit Corporation, the Committee provides $783,507,000, a 
decrease of $716,493,000 below the amount provided in fiscal 
year 1997 and the same as the budget request.

       Operations and Maintenance for Hazardous Waste Management

1997 limitation.........................................    ($5,000,000)
1998 budget estimate....................................     (5,000,000)
Provided in the bill....................................     (5,000,000)
Comparison:
    1997 limitation..........................(.........................)
    1998 budget estimate.....................(.........................)

    The Commodity Credit Corporation's (CCC) hazardous waste 
management program is intended to ensure compliance with the 
Comprehensive Environmental Response, Compensation, and 
Liability Act, as amended, and the Resource Conservation and 
Recovery Act, as amended.
    Investigative and cleanup costs associated with the 
management of CCC hazardous waste are paid from USDA's 
hazardous waste management appropriation. CCC funds operations 
and maintenance costs only.

                          Committee Provisions

    For CCC Operations and Maintenance for Hazardous Waste 
Management, the Committee provides a limitation of $5,000,000, 
the same as the amount available for fiscal year 1997 and the 
same as the budget request.

                    TITLE II--CONSERVATION PROGRAMS

  Office of the Under Secretary for Natural Resources and Environment

1997 appropriation......................................        $693,000
1998 budget estimate....................................         702,000
Provided in the bill....................................         693,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................          -9,000

    The Office of the Under Secretary for Natural Resources and 
Environment provides direction and coordination in carrying out 
the laws enacted by the Congress with respect to natural 
resources and the environment. The Office has oversight and 
management responsibilities for the Natural Resources 
Conservation Service and the Forest Service.

                          Committee Provisions

    For the Office of the Under Secretary for Natural Resources 
and Environment, the Committee provides an appropriation of 
$693,000, the same as the amount available for fiscal year 1997 
and a decrease of $9,000 below the budget request.

                 Natural Resources Conservation Service

    NRCS, formerly the Soil Conservation Service (SCS), is the 
lead Federal conservation agency for private land. SCS was 
established in 1935 to carry out a continuing program of soil 
and water conservation on the Nation's private and non-Federal 
land. NRCS was established by the Department of Agriculture 
Reorganization Act of 1994 (7 U.S.C. 6962). The agency combines 
the authorities of the former SCS and directs sixteen 
additional financial or technical assistance programs for 
natural resource conservation.
    NRCS provides conservation technical assistance through 
local conservation districts to individuals, communities, 
watershed groups, tribal governments, Federal, state, and local 
agencies, and others. The NRCS staff at the local level work 
with state and local conservation staff and volunteers in a 
partnership to assist individuals and communities to care for 
natural resources. NRCS also develops technical guidance for 
conservation planning and assistance. This technical guidance 
is tailored to local conditions and is widely used by NRCS 
staff and governmental and nongovernmental organizations to 
ensure that conservation is based on sound science.
    The benefits of these activities are multifaceted, 
including sustained and improved agricultural productivity; 
cleaner, safer, and more dependable water supplies; reduced 
damages caused by floods and other natural disasters; and an 
enhanced natural resource base to support continued economic 
development, recreation, and the environment.

                        Conservation Operations

1997 appropriation......................................    $619,742,000
1998 budget estimate.................................... \1\ 722,268,000
Provided in the bill....................................     610,000,000
Comparison:
    1997 appropriation..................................      -9,742,000
    1998 budget estimate................................    -112,268,000

\1\ Includes funding for Watershed Surveys and Planning and technical 
assistance for the Watershed and Flood Prevention Operators Program.

    The purpose of conservation operations is to sustain 
agricultural productivity and protect and enhance the natural 
resource base. This is done through providing technical 
assistance to land users, communities, units of state and local 
government, and other Federal agencies in planning and 
implementing natural resources solutions to reduce erosion, 
improve soil and water quantity and quality, improve and 
conserve wetlands, enhance fish and wildlife habitat, improve 
air quality, improve pasture and range conditions, reduce 
upstream flooding, and improve woodlands. Assistance is also 
provided to implement highly erodible land (HEL), wetlands 
(swampbuster), wetlands reserve program (WRP), and conservation 
reserve program (CRP) provisions of the 1985 Food Security Act, 
as amended by the Food, Agriculture, Conservation, and Trade 
Act of 1990, the 1993 Omnibus Reconciliation Act, and the 
Federal Agriculture Improvement and Reform Act of 1996.

                          Committee Provisions

    For Conservation Operations, the Committee provides an 
appropriation of $610,000,000, a decrease of $9,742,000 below 
the amount available for fiscal year 1997 and a decrease of 
$112,268,000 below the budget request. Included in this amount 
is $15,000,000, the same as the amount available for fiscal 
year 1997, to continue the grazing lands conservation 
initiative.
    The conservation operations program accounts for 80 percent 
of the Natural Resources Conservation Service appropriations, 
yet there is virtually no accountability for how these funds 
are used by the agency. The Committee notes the Urban Resources 
Partnership Initiative, the Northwest Salmon Recovery 
Initiative, and the American Heritage River Initiative as 
examples. In these cases, millions of dollars are being spent 
on major initiatives that have never been requested from or 
provided for by Congress. The agency budget justification, 
which provide the Committee with the details of the budget 
request, do not mention these projects or their funding levels. 
The Committee does not believe it has a complete understanding 
of how the conservation operations funds are being used. The 
Committee directs the agency to enhance its accountability by 
tracking the activities conservation operations funds are being 
spent on and presenting a more detailed budget justification 
when it submits the fiscal year 1999 request. Funds for these 
initiatives are not available until justification and reprogram 
requests are approved.
    The Committee has provided for the continuation of the 
following projects: $300,000 to promote pastureland management 
and rotational grazing in central New York; $250,000 to 
establish best management practices to individual farmers to 
reduce the impact of agriculture-related non-point sources of 
pollution in the Skaneateles and Owasco, New York watersheds; 
$350,000 for the Great Lakes Basin Program for Soil and Erosion 
Sediment Control; $100,000 for the Community Leadership 
Alliance for Sustainable Development Program; and $300,000 for 
technical assistance to the Westchester Soil and Water 
Conservation District for a partnership with the Environmental 
Protection Agency to address land use and water quality issues 
affecting the Long Island Sound.
    The Committee expects the project to assist farmers 
surrounding Lake Otisco in central New York in implementing 
best management practices to continue at the funding level of 
$200,000 through the Environmental Quality Incentives Program. 
The Committee also expects the Department to give every 
consideration to utilizing financial or educational assistance 
under EQIP for pilot work to evaluate and assess the 
effectiveness of various best management practices to assist 
livestock producers in the Bosque River watershed in Texas.
    The Committee directs the agency to provide additional 
support to the work being conducted at the Rice Research 
Station in Louisiana.
    The 1996 Farm Bill directed EQIP funding to be used to 
address national environmental priorities in cooperation with 
the agricultural community. However, the committee has learned 
that USDA is distributing the FY 1997 EQIP funds among states 
based on the allocation formula of conservation programs which 
are no longer authorized, in part to maintain existing NRCS 
staffing patterns. The committee strongly objects to this 
funding distribution, which is clearly contrary to 
congressional intent. The committee expects NRCS to allocate 
EQIP funds based exclusively on environmental priorities and 
not to apply state funding ceilings and floors which were 
imposed as constraints in determining state shares in the FY 
1997 round of funding.
    The Committee is aware of the ongoing environmental problem 
associated with agriculture drainage wells in Iowa. The 
Committee expects the NRCS to cooperate with the Army Corps of 
Engineers in facilitating the closing of these wells in a 
timely manner.
    Furthermore, the Committee recognizes the environmental 
benefits associated with the closure of agriculture drainage 
wells and expects these benefits to be taken into account fully 
for purposes of determining wetlands mitigation if and when the 
wells are closed and alternative drainage systems are devised.
    The Committee also directs the Department to give due 
consideration to the possibility of allowing agriculture 
drainage districts or producers seeking to close agriculture 
drainage wells and to create alternative replacement 
agriculture drainage systems to use the Conservation Reserve 
Program, EQIP, and/or the Wetlands Reserve Program to meet 
wetlands mitigation requirements resulting from the 
establishment of alternative replacement drainage systems.

                     watershed surveys and planning

1997 appropriation......................................     $12,381,000
1998 budget estimate....................................           (\1\)
Provided in the bill....................................      10,000,000
Comparison:
    1997 appropriation..................................      -2,381,000
    1998 budget estimate................................     +10,000,000

\1\Proposed to be funded under conservation operations.


    The Watershed Protection and Flood Prevention Act, Public 
Law 83-566, August 4, 1954, provided for the establishment of 
the Small Watershed Program (16 U.S.C. 1001-1008), and section 
6 of the Act provided for the establishment of the River Basin 
Surveys and Investigations Program (16 U.S.C. 1006-1009). A 
separate appropriation funded the two programs until fiscal 
year 1996 when they were combined into a single appropriation, 
Watershed Surveys and Planning.
    River Basin activities provide for cooperation with other 
Federal, state, and local agencies in making investigations and 
surveys of the watersheds of rivers and other waterways as a 
basis for the development of coordinated programs. Reports of 
the investigations and surveys are prepared to serve as a guide 
for the development of agricultural, rural, and upstream 
watershed aspects of water and related land resources, and as a 
basis of coordination of this development with downstream and 
other phases of water development.
    Watershed planning activities provide for cooperation 
between the Federal government and the states and their 
political subdivisions in a program of watershed planning. 
Watershed plans form the basis for installing works of 
improvement of floodwater retardation, erosion control, and 
reduction of sedimentation in the watershed of rivers and 
streams and to further the conservation, development, 
utilization, and disposal of water. Watershed planning consists 
of assisting local organizations to develop their watershed 
work plan by making investigations and surveys in response to 
requests made by sponsoring local organizations. These plans 
describe the soil erosion, water management, and sedimentation 
problems in a watershed and works of improvement proposed to 
alleviate these problems. Plans also include estimated benefits 
and costs, cost sharing and operating and maintenance 
arrangements, and other appropriate information necessary to 
justify Federal assistance for carrying out the plan.

                          committee provisions

    For Watershed Surveys and Planning, the Committee provides 
an appropriation of $10,000,000, a decrease of $2,381,000 below 
the amount available for fiscal year 1997. The budget request 
proposed to fund these activities under conservation 
operations.

               Watershed and Flood Prevention Operations

1997 appropriation......................................    $101,036,000
1998 budget estimate....................................      40,000,000
Provided in the bill....................................     101,036,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................     +61,036,000

    The Watershed Protection and Flood Prevention Act (Public 
Law 566, 83d Cong.), as amended (16 U.S.C. 1001-1005, 1007-
1009), provides for cooperation among the Federal government, 
the states, and local political subdivisions in a program to 
prevent erosion, floodwater, and sediment damages in the 
watersheds or rivers and streams, and to further the 
conservation, development, utilization, and disposal of water.
    The work of the Department under this item includes 
financial assistance for the installation of works of 
improvement specified in approved watershed work plans 
including structural measures, land treatment measures, and 
program evaluation studies in selected watershed projects to 
determine the effectiveness of structural and land treatment 
measures installed. In addition, NRCS makes loans to local 
organizations to finance the local share of the costs of 
installing planned works of improvement.

                          committee provisions

    For Watershed and Flood Prevention Operations, the 
Committee provides an appropriation of $101,036,000, the same 
as the amount available for fiscal year 1997 and an increase of 
$61,036,000 above the budget request. Language is included 
which limits the amount spent on technical assistance to not 
more than $50,000,000. The Committee expects more funding to be 
spent on completing on-going projects and reducing the backlog 
of watershed projects.
    The Committee is aware of and expects progress to continue 
on the following projects: Virgil Creek watershed, Cortland and 
Tompkins Counties, New York; North Deer Creek Watershed, 
Oklahoma; Park River Dam #5, North Dakota; the four pilot 
projects in North Florida related to dairy and poultry cleanup 
efforts; and Marshland Flood Control District, Washington.

                 resource conservation and development

1997 appropriation......................................     $29,377,000
1998 budget estimate....................................      47,700,000
Provided in the bill....................................      29,377,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................     -18,323,000

    The Natural Resources Conservation Service has general 
responsibility under provisions of section 102, title I of the 
Food and Agriculture Act of 1962, for developing overall work 
plans for resource conservation and development projects in 
cooperation with local sponsors; to help develop local programs 
of land conservation and utilization; to assist local groups 
and individuals in carrying out such plans and programs; to 
conduct surveys and investigations relating to the conditions 
and factors affecting such work on private lands; and to make 
loans to project sponsors for conservation and development 
purposes and to individual operators for establishing soil and 
water conservation practices.

                          committee provisions

    For Resource Conservation and Development, the Committee 
provides an appropriation of $29,377,000, the same as the 
amount available for fiscal year 1997 and a decrease of 
$18,323,000 below the budget request.

                      forestry incentives program

1997 appropriation......................................      $6,325,000
1998 budget estimate....................................       6,325,000
Provided in the bill....................................       6,325,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................................

    The Forestry Incentives Program is authorized by the 
Cooperative Forestry Assistance Act of 1978 (Public Law 95-
313), as amended by section 1214, title XII, of the Food, 
Agriculture, Conservation, and Trade Act of 1990 and the 
Federal Agriculture Improvement and Reform Act of 1996. Its 
purpose is to encourage the development, management, and 
protection of nonindustrial private forest lands. The program 
will be carried out by providing technical assistance and long-
term cost sharing agreements with private landowners.

                          committee provisions

    For the Forestry Incentives Program, the Committee provides 
an appropriation of $6,325,000, the same as the amount 
available for fiscal year 1997 and the same as the budget 
request.

        Outreach for Socially Disadvantaged Farmers and Ranchers

1997 appropriation......................................      $1,000,000
1998 budget estimate....................................       5,000,000
Provided in the bill....................................       2,000,000
Comparison:
    1997 appropriation..................................      +1,000,000
    1998 budget estimate................................      -3,000,000

    This program is authorized under section 2501 of title XXV 
of the Food, Agriculture, Conservation, and Trade Act of 1990. 
Grants are made to eligible community-based organizations with 
demonstrated experience in providing education or other 
agriculturally related services to socially disadvantaged 
farmers and ranchers in their area of influence. Also eligible 
are the 1890 land-grant colleges, Tuskegee University, Indian 
tribal community colleges, and Hispanic serving post-secondary 
education facilities.
    Administration of the program was transferred to the 
Natural Resources Conservation Service from the Farm Service 
Agency beginning in fiscal year 1997.

                          committee provisions

    For the Outreach for Socially Disadvantaged Farmers and 
Ranchers Program, the Committee provides an appropriation of 
$2,000,000, an increase of $1,000,000 above the amount 
available for fiscal year 1997 and a decrease of $3,000,000 
below the budget request.

                 TITLE III--RURAL DEVELOPMENT PROGRAMS

    The Federal Crop Insurance Reform and Department of 
Agriculture Reorganization Act of 1994 (Public Law 103-354) 
abolished the Farmers Home Administration, Rural Development 
Administration, and Rural Electrification Administration and 
replaced those agencies with the Rural Housing Service, Rural 
Business-Cooperative Service, and Rural Utilities Service and 
placed them under the oversight of the Under Secretary for 
Rural Development. These agencies deliver a variety of programs 
through a network of state, district, and county offices.
    In the 1930's and 1940's these agencies were primarily 
involved in making small loans to farmers; however, today these 
agencies have a multi-billion dollar loan program throughout 
all America providing loan and grant assistance for single 
family, multi-family, housing, and special housing needs, as 
well as a variety of community facilities, infrastructure, and 
business development programs.

          Office of the Under Secretary for Rural Development

1997 appropriation......................................        $588,000
1998 budget estimate....................................         596,000
Provided in the bill....................................         588,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................          -8,000

    The Office of the Under Secretary for Rural Development 
provides direction and coordination in carrying out the laws 
enacted by the Congress with respect to the Department's rural 
economic and community development activities. The Office has 
oversight and management responsibilities for the Rural Housing 
Service, Rural Business-Cooperative Service, and Rural 
Utilities Service.

                          committee provisions

    For the Office of the Under Secretary for Rural 
Development, the Committee provides an appropriation of 
$588,000, the same as the amount available for fiscal year 1997 
and a decrease of $8,000 below the budget request.
    The Department has requested funding in fiscal year 1998 
for the Rural Community Advancement Program. The Committee has 
chosen instead to continue funding programs in rural housing, 
economic development, water and sewer and utilities for which 
there is more demand than available funds. The bill provides 
three funding streams consisting of the Rural Housing 
Assistance Program, the Rural Business-Cooperative Assistance 
Program and the Rural Utilities Assistance Program. These three 
programs consolidate funding for individual grant and loan 
activities into three separate appropriations. Within each 
funding stream, the Department and state rural development 
directors may allocate funds as needed rather than be limited 
to a fixed amount for each separate activity.
    The individual budgets and activities for each of the three 
funding streams are further described in this title of the 
report.
    The fiscal year 1998 budget request consolidates funding 
for several rural development grant programs under rural 
housing assistance grants. The Committee has not provided 
funding for this program. However, all of the individual 
activities for which funding has been requested have received 
an appropriation elsewhere in the bill. Mutual and self-help 
housing grants are provided for as a separate activity. Grants 
for domestic farm labor, very low-income housing repair, and 
rural housing preservation are provided for under the rural 
housing assistance program.
    The Committee is concerned about the ability of the 
Department to assist nonprofit and community development groups 
in capacity-building and directs the Department to submit 
proposals for supporting this activity in the fiscal year 1999 
budget request.

                         Rural Housing Service

    The Rural Housing Service (RHS) was established under 
Federal Crop Insurance Reform and Department of Agriculture 
Reorganization Act of 1994, dated October 13, 1994.
    The mission of the Service is to improve the quality of 
life in rural America by assisting rural residents and 
communities in obtaining adequate and affordable housing and 
access to needed community facilities. The goals and objectives 
of the Service are: (1) facilitate the economic revitalization 
of rural areas by providing direct and indirect economic 
benefits to individual borrowers, families, and rural 
communities; (2) assure that benefits are communicated to all 
program eligible customers with special outreach efforts to 
target resources to underserved, impoverished, or economically 
declining rural areas; (3) lower the cost of programs while 
retaining the benefits by redesigning more effective programs 
that work in partnership with state and local governments and 
the private sector; and (4) leverage the economic benefits 
through the use of low-cost credit programs, especially 
guaranteed loans.

              RURAL HOUSING INSURANCE FUND PROGRAM ACCOUNT

                          ESTIMATED LOAN LEVEL

1997 loan level.........................................($3,459,854,000)
1998 budget estimate.................................... (4,199,832,000)
Provided in the bill.................................... (4,149,827,000)
Comparison:
    1997 loan level.....................................  (+689,973,000)
    1998 budget estimate................................   (-50,005,000)

    This fund was established in 1965 (Public Law 89-117) 
pursuant to Section 517 of Title V of the Housing Act of 1949, 
as amended. This fund may be used to insure or guarantee rural 
housing loans for single family homes, rental and cooperative 
housing, farm labor housing, and rural housing sites. Rural 
housing loans are made to construct, improve, alter, repair or 
replace dwellings and essential farm service buildings that are 
modest in size, design, and cost. Rental housing insured loans 
are made to individuals, corporations, associations, trusts, or 
partnerships to provide moderate-cost rental housing and 
related facilities for elderly persons in rural areas. These 
loans, made with funds advanced by private lenders, are 
repayable in not to exceed 50 years. Farm labor housing insured 
loans are made either to a farm owner or to a public or private 
nonprofit organization to provide modest living quarters and 
related facilities for domestic farm labor. Loan programs are 
limited to rural areas which include towns, villages, and other 
places of not more than 10,000 population, which are not part 
of an urban area. Loans may also be made in areas with a 
population in excess of 10,000, but less than 20,000, if the 
area is not included in a standard metropolitan statistical 
area and has a serious lack of mortgage credit for low- and 
moderate-income borrowers.

                          committee provisions

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                                                   Committee    
                                                           FY 1997 level     FY 1998 estimate      provisions   
----------------------------------------------------------------------------------------------------------------
Rural Housing Insurance Fund Program Account:                                                                   
    Low-income family housing (sec 502):                                                                        
        Direct.........................................       ($1,000,000)       ($1,000,000)         ($950,000)
        Unsubsidized guaranteed........................        (2,300,000)        (3,000,000)        (3,000,000)
    Rental housing (sec 515)...........................       \1\ (58,654)          (128,640)          (128,640)
    Housing repair (sec 504)...........................           (35,000)           (30,000)           (30,000)
    Farm labor (sec 514)...............................           (15,000)           (15,001)           (15,000)
    Credit sales of acquired property..................           (50,000)           (25,004)           (25,000)
    Site loans (sec 524)...............................              (600)              (600)              (600)
    Self-help housing land development fund............              (600)              (587)              (587)
                                                        --------------------------------------------------------
      Total, loan authorization........................       ($3,459,854)       ($4,199,832)       ($4,149,827)
----------------------------------------------------------------------------------------------------------------
\1\ Does not include section 515 new construction.                                                              

       estimated loan subsidy and administrative expenses levels

                                                                                                                
                                                            Direct loan      Guaranteed loan     Administrative 
                                                              subsidy            subsidy            expenses    
                                                                                                                
1997 appropriation.....................................       $134,020,000         $6,210,000       $366,205,000
1998 budget estimate...................................        218,054,000          6,900,000        354,785,000
Provided in the bill...................................        211,542,000          6,900,000        354,785,000
Comparison:                                                                                                     
    1997 appropriation.................................        +77,522,000           +690,000        -11,420,000
    1998 budget estimate...............................         -6,512,000  .................  .................
                                                                                                                

    The Federal Credit Reform Act of 1990 established the 
Program Account. Appropriations to this account will be used to 
cover the lifetime subsidy costs associated with the direct 
loans obligated and loan guarantees committed in 1998, as well 
as for administrative expenses.

                          committee provisions

    The Committee strongly urges the Rural Housing Service to 
continue participation in the leveraged loan program of New 
York and other states where alternative procedures are needed 
to meet the needs of affordable housing in rural areas.
    The following table reflects the cost of the loan programs 
under credit reform. In many cases, changes from the fiscal 
year 1997 amount reflect changes in the loan subsidy rates as 
set by OMB.

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                                                   Committee    
                                                           FY 1997 level     FY 1998 estimate      provisions   
----------------------------------------------------------------------------------------------------------------
Loan subsidies:                                                                                                 
    Single family (sec 502):                                                                                    
        Direct.........................................            $83,000           $128,100           $121,600
        Unsubsidized guaranteed........................              6,210              6,900              6,900
    Housing repair (sec 504)...........................             11,081             10,308             10,300
    Farm labor (sec 514)...............................              6,885              7,388              7,388
    Rental housing (sec 515)...........................             28,987             68,745             68,745
    Credit sales of acquired property..................              4,050              3,493              3,492
    Self-help housing land development fund............                 17                 20                 17
                                                        --------------------------------------------------------
      Total, Loan subsidies............................           $140,230           $224,954           $218,442
RHIF expenses:                                                                                                  
    Administrative expenses............................           $366,205           $354,785           $354,785
----------------------------------------------------------------------------------------------------------------

                 multi-family housing guarantee program

                                                                        
                                         Loan level       Subsidy level 
                                                                        
1997 appropriation..................       $30,000,000        $1,200,000
1998 budget estimate................  ................  ................
Provided in the bill................        19,700,000         1,200,000
Comparison:                                                             
    1997 appropriation..............       -10,300,000  ................
    1998 budget estimate............       +19,700,000        +1,200,000
                                                                        

    The Section 538 Multifamily Rural Rental Guarantee Loan 
Program was authorized as part of P.L. 104-120 signed by the 
President on March 28, 1996. In fiscal year 1996, RHS operated 
a demonstration program to gather data and experience on what 
types of financing and projects were most appropriate for the 
guarantee program. The program utilizes up to 90% guarantees on 
90% loan to value ratios for the profit sector and 97% loan to 
value ratios for the non-profit development sector. The program 
guarantees loans made by certified lenders for multi-family 
housing available to moderate and low income rural residents.

                          committee provision

    For the cost of subsidies for the Multi-Family Rural 
Housing Guarantee Program, the Committee provides an 
appropriation of $1,200,000. The same amount was provided for 
this program in fiscal year 1997 under the Rural Housing 
Assistance Program. There was no budget request for this 
program in fiscal year 1998. This subsidy amount will provide a 
loan level of approximately $19,700,000.

                       rental assistance program

1997 appropriation .....................................\1\ $493,870,000
1998 budget estimate.................................... \2\ 593,397,000
Provided in the bill....................................     493,870,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................     -99,527,000

\1\ Funding for the portion of rental assistance payments supporting 
rental housing section 515 new construction is included in the RHAP 
account.
\2\ Includes $52 million transfer from HUD section 8 contracts.

    The Housing and Community Development Act of 1974 
established a rural rental assistance program to be 
administered through the rural housing loans programs.
    The objective of the program is to reduce rents paid by 
low-income families living in Rural Housing Service financed 
rental projects and farm labor housing projects. Under this 
program, low-income tenants will contribute the higher of: (1) 
30 percent of monthly adjusted income; (2) 10 percent of 
monthly income; or (3) designated housing payments from a 
welfare agency.
    Payments from the fund are made to the project owner for 
the difference between the tenant's payment and the approved 
rental rate established for the unit.
    The program is administered in tandem with Rural Housing 
Service Section 515 rural rental and cooperative housing 
programs and the farm labor loan and grant programs. Priority 
is given to existing projects for units occupied by low-income 
families to extend expiring contracts or provide full amounts 
authority to existing contracts; any remaining authority will 
be used for projects receiving new construction commitments 
under Sections 514, 515, or 516 for very low-income families 
with certain limitations.

                          committee provisions

    For the Rental Assistance Program, the Committee provides a 
program level of $493,870,000, the same as provided in fiscal 
year 1997 and a decrease of $99,527,000 below the budget 
request.
    The Committee does not concur with the proposed transfer of 
$52,000,000 in Section 8 rental subsidies from HUD.

                  mutual and self-help housing grants

1997 appropriation......................................     $26,000,000
1998 budget estimate....................................           (\1\)
Provided in the bill....................................      26,000,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................     +26,000,000

\1\ Funding for mutual and self-help housing grants is included in the 
Rural Housing Assistance Grants request.

    This grant program is authorized by title V of the Housing 
Act of 1949, as amended. Grants are made to local organizations 
to promote the development of mutual or self-help programs 
under which groups of usually six to ten families build their 
own homes by mutually exchanging labor. Funds may be used to 
pay the cost of construction supervisors who will work with 
families in the construction of their homes and for 
administrative expenses of the organizations providing the 
self-help assistance.

                          COMMITTEE PROVISIONS

    For Mutual and Self-Help Housing Grants, the Committee 
provides an appropriation of $26,000,000, the same amount as 
available in fiscal year 1997. The budget request for mutual 
and self-help housing was $26,000,000 under the Rural Housing 
Assistance Grants program.

                 RURAL COMMUNITY FIRE PROTECTION GRANTS

1997 appropriation......................................         ( \1\ )
1998 budget estimate....................................      $2,000,000
Provided in the bill....................................       2,000,000
Comparison:
    1997 appropriation..................................      +2,000,000
    1998 budget estimate................................................

\1\ This program was funded under the Rural Housing Assistance Program 
(RHAP) in 1997.

    Rural community fire protection grants are authorized by 
Section 7 of the Cooperative Forestry Assistance Act of 1978. 
Grants are made to public bodies to organize, train, and equip 
local firefighting forces, including those of Indian tribes or 
other native groups, to prevent, control, and suppress fires 
threatening human lives, crops, livestock, farmsteads or other 
improvements, pastures, orchards, wildlife, rangeland, 
woodland, and other resources in rural areas.

                          COMMITTEE PROVISIONS

    For Rural Community Fire Protection Grants, the Committee 
provides an appropriation of $2,000,000, the same as the budget 
request. In fiscal year 1997, $1,285,000 was provided for this 
program under the Rural Housing Assistance Program.

                    rural housing assistance program

1997 appropriation......................................    $130,433,000
1998 budget estimate....................................         ( \1\ )
Provided in the bill....................................      86,488,000
Comparison:
    1997 appropriation..................................     -43,945,000
    1998 budget estimate................................     +86,488,000

\1\ The Administration proposed funding for this account under ``Rural 
Community Advancement Program'' and ``Rural Housing Assistance Grants.''

    The Committee consolidates funding for the following 
programs under the Rural Housing Assistance Programs: grants 
for rural housing for domestic farm labor, very low-income 
housing repair grants, rural housing preservation grants, 
compensation for construction defects, direct community 
facility loans, guaranteed community facility loans and 
community facility grants.
    Community Facility Loans were created by the Rural 
Development Act of 1972. Loans are made to organizations, 
including certain Indian tribes, corporations not operated for 
profit, and public and quasi-public agencies, to construct, 
enlarge, extend, or otherwise improve community facilities 
providing essential services to rural residents. Such 
facilities include those providing or supporting overall 
community development such as fire and rescue services, health 
care, transportation, traffic control, and community, social, 
cultural, and recreational benefits. Loans are made for 
facilities which primarily serve rural residents of open 
country and rural towns and villages of not more than 20,000 
people. Health care and fire and rescue facilities are the 
priorities of the program and receive the majority of available 
funds.
    The Community Facility Grant program authorized in the 
Federal Agriculture Improvement and Reform Act of 1996 (P.L. 
104-127), is used in conjunction with the existing direct and 
guaranteed loan programs for the development of community 
facilities, such as hospitals, fire stations, and community 
centers. Grants will be targeted to the lowest income 
communities.
    Rural Housing for Domestic Farm Labor grants are provided 
to public or private nonprofit organizations or other eligible 
organizations for low-rent housing and related facilities for 
domestic farm labor.
    Under Section 516 of the Housing Act of 1949, the Rural 
Housing Service is authorized to share with States or other 
political subdivisions, public or private nonprofit 
organizations, or nonprofit organizations of farm workers, the 
cost of providing low-rent housing, basic household 
furnishings, and related facilities to be used by domestic farm 
laborers. Such housing may be for year-round or seasonal 
occupancy and consist of family units, apartments, or 
dormitory-type units, constructed in an economical manner, and 
not of elaborate or extravagant design or materials.
    The Very Low-Income Housing Repair Grants program is 
authorized under Section 504 of Title V of the Housing Act of 
1949, as amended. The program makes grants to very low-income 
families to make necessary repairs to their homes in order to 
make such dwellings, safe and sanitary, and remove hazards to 
the health of the occupants, their families, or the community. 
A grant can be made in combination with a Section 504 very low-
income housing repair loan.
    Rural Housing Preservation Grants are used for home repair 
for low- and very low-income people. The purpose of the 
preservation program is to improve the delivery of 
rehabilitation assistance by employing the expertise of housing 
organizations at the local level. Eligible applicants will 
compete on a state-by-state basis for grants funds. These funds 
may be administered as loans, loan write-downs, or grants to 
finance home repair. The program is administered by local 
grantees.
    Compensation for Construction Defects provides funds for 
grants to eligible section 502 borrowers to correct structural 
defects, or to pay claims of owners arising from such defects 
on a newly constructed dwelling purchased with RHS financial 
assistance.



                          COMMITTEE PROVISIONS

    For the Rural Housing Assistance Program (RHAP), the 
Committee provides an appropriation of $86,488,000, a decrease 
of $43,945,000 below the amount provided for fiscal year 1997. 
There was no budget request for this program for fiscal year 
1998.
    The fiscal year 1997 appropriation included approximately 
$60,000,000 for Section 515 multi-family rural rental housing 
loans for new construction. For fiscal year 1998, the Committee 
proposes funding for Section 515 new construction along with 
rehabilitation as a separate program.
    The fiscal year 1998 budget request included funding for 
RHAP programs under the Rural Community Advancement Program and 
the Rural Housing Assistance Grant program.
    The Committee also provides language for an earmark of 
$1,200,000 for empowerment zones and enterprise communities.

                         SALARIES AND EXPENSES

                                                                                                                
                                                             Administrative                                     
                                                                expenses          Transfers      Total expenses 
                                                                                                                
1997 level................................................       $60,743,000    ($366,205,000)    ($426,948,000)
1998 budget estimate......................................        58,804,000     (354,785,000)     (413,589,000)
Provided in the bill......................................        58,804,000     (354,785,000)     (413,589,000)
Comparison:                                                                                                     
    1997 level............................................        -1,939,000     (-11,420,000)     (-13,359,000)
    1998 budget estimate..................................  ................  (...............                  
                                                                                   ..........)  (...............
                                                                                                     ..........)
                                                                                                                

    These funds are used to administer the loan and grant 
programs of the Rural Housing Service including reviewing 
applications, making and collecting loans, and providing 
technical assistance and guidance to borrowers; and to assist 
in extending other Federal programs to people in rural areas.
    Under credit reform, administrative costs associated with 
loan programs are appropriated to the program accounts for the 
rural housing insurance fund and rural community facility 
loans. Appropriations to the salaries and expenses account will 
be for costs associated with grant programs.

                          Committee Provisions

    For Salaries and Expenses of the Rural Housing Service, the 
Committee provides an appropriation of $58,804,000, a decrease 
of $1,939,000 below the amount available for fiscal year 1997 
and the same as the budget request.

                   Rural Business-Cooperative Service

    The Rural Business-Cooperative Service (RBS) was 
established by Public Law 103-354, Federal Crop Insurance 
Reform and Department of Agriculture Reorganization Act of 
1994, dated October 13, 1994. Its programs were previously 
administered by the Rural Development Administration and the 
Rural Electrification Administration.
    The mission of the Rural Business-Cooperative Service is to 
enhance the quality of life for all rural residents by 
assisting new and existing cooperatives and other businesses 
through partnership with rural communities. The goals and 
objectives are to: (1) promote a stable business environment in 
rural America through financial assistance, sound business 
planning, technical assistance, appropriate research, 
education, and information; (2) support environmentally-
sensitive economic growth that meets the needs of the entire 
community; and (3) assure that the Service benefits are 
available to all segments of the rural community, with emphasis 
on those most in need.

              rural development loan fund program account

                          estimated loan level

1997 loan level.........................................   ($37,544,000)
1998 budget estimate....................................    (35,000,000)
Provided in the bill....................................    (35,000,000)
Comparison:
    1997 loan level.....................................    (-2,544,000)
    1998 budget estimate.....................(.........................)

    The rural development (intermediary relending) loan program 
was originally authorized by the Economic Opportunity Act of 
1964 (Public Law 88-452). The making of rural development loans 
by the Department of Agriculture was reauthorized by Public Law 
99-425, the Human Services Reauthorization Act of 1986.
    Loans are made to intermediary borrowers (small investment 
groups) who in turn will reloan the funds to rural businesses, 
community development corporations private nonprofit 
organizations, public agencies, et cetera, for the purpose of 
improving business, industry, community facilities, and 
employment opportunities and diversification of the economy in 
rural areas.
    The Federal Credit Reform Act of 1990 established the 
Program Account. Appropriations to this account will be used to 
cover the lifetime subsidy costs associated with the direct 
loans obligated in 1998, as well as for administrative 
expenses.

                          Committee Provisions

    For the Rural Development Loan Fund Program Account, the 
Committee provides for a loan level of $35,000,000, a decrease 
of $2,544,000 below the loan level for fiscal year 1997 and the 
same as the budget request.

       estimated loan subsidy and administrative expenses levels

                                                                        
                                         Direct loan     Administrative 
                                           subsidy          expenses    
                                                                        
1997 appropriation..................       $17,270,000  ................
1998 budget estimate................        16,888,000        $3,482,000
Provided in the bill................        16,888,000         3,482,000
Comparison:                                                             
    1997 appropriation..............          -382,000        +3,482,000
    1998 budget estimates...........  ................  ................
                                                                        

            rural economic development loans program account

                          estimated loan level

1997 loan level.........................................   ($12,865,000)
1998 budget estimate....................................    (25,000,000)
Provided in the bill....................................    (25,000,000)
Comparison:
    1997 loan level.....................................   (+12,135,000)
    1998 budget estimate.....................(.........................)

    The rural economic development loans program was 
established by the Reconciliation Act of December 1987 (P.L. 
100-203), which amended the Rural Electrification Act of 1936, 
by establishing a new section 313. This section of the Rural 
Electrification Act (7 U.S.C. 901) established a cushion of 
credits payment program and created the rural economic 
development subaccount. The Administrator of RUS is authorized 
under the Act to utilize funds in this program to provide zero 
interest loans to electric telecommunications borrowers for the 
purpose of promoting rural economic development and job 
creation projects, including funding for feasibility studies, 
start-up costs, and other reasonable expenses for the purpose 
of fostering rural economic development.

                          committee provisions

    For the Rural Economic Development Loans Program Account, 
the Committee provides for a loan level of $25,000,000, an 
increase of $12,135,000 above the level for fiscal year 1997 
and the same as the budget request.
    The Committee has provided language, requested by the 
Administration, to use earnings generated by the interest 
differential on voluntary cushion of credit payments made by 
Rural Utilities Service borrowers to provide necessary loan 
subsidies for rural economic development loans. By using these 
earnings for subsidy budget authority, additional loans funds 
will be available to rural communities. The discretionary cost 
of these loans is offset by reductions to rural economic 
development grants made from the cushion of credit.

       estimated loan subsidy and administrative expenses levels

                                                                        
                                         Direct loan     Administrative 
                                           subsidy          expenses    
                                                                        
1997 appropriation..................        $2,830,000          $654,000
1998 budget estimate................             (\1\)  ................
Provided in the bill................             (\1\)             (\1\)
Comparison:                                                             
    1997 appropriation..............        -2,830,000          -654,000
                                                                        
    1998 budget estimate............  ................  ................
                                                                        
                                                                        
\1\ Up to $5,977,500 to be derived by transfer from interest on the     
  cushion of credit payments, as authorized by section 313 of the REA   
  Act of 1936, as amended.                                              

 alternative agricultural research and commercialization revolving fund

                         cooperative agreements

1997 appropriation......................................      $7,000,000
1998 budget estimate....................................      10,000,000
Provided in the bill....................................................
Comparison:
    1997 appropriation..................................      -7,000,000
    1998 budget estimate................................     -10,000,000

    The Alternative Agricultural Research and Commercialization 
Act of 1990, subtitle G of the Food, Agriculture, Conservation, 
and Trade Act of 1990, as amended by the Federal Agriculture 
Improvement and Reform Act of 1996, was established to develop 
and produce marketable products other than food, feed, or 
traditional forest or fiber products. It will assist in 
researching, developing, commercializing, and marketing new 
nonfood, nonfeed uses for traditional and new agriculture 
commodities.

                          Committee Provisions

    The Committee does not provide funding for the Alternative 
Agricultural Research and Commercialization Revolving Fund for 
fiscal year 1998.
    The Committee notes that $28,000,000 in U.S. Government 
funds have been invested in AARC since its first full year of 
operation in 1993.
    The Committee believes that AARC should begin operating 
with repayments to its revolving fund as intended by Congress 
when the program was first authorized.

                  rural cooperative development grants

1997 appropriation......................................  (1)
1998 budget estimate....................................      $3,000,000
Provided in the bill....................................       3,000,000
Comparison:
    1997 appropriation..................................      +3,000,000
    1998 budget estimate................................................

\1\ Funded under the Rural Business-Cooperative Assistance Program.

    Rural Cooperative Development Grants are authorized under 
section 310B(e) of the Consolidated Farm and Rural Development 
Act, as amended. Grants are made to fund the establishment and 
operation centers for rural cooperative development with their 
primary purpose being the improvement of economic conditions in 
rural areas. Grants may be made to nonprofit institutions or 
institutions of higher education. Grants may be used to pay up 
to 75 percent of the cost of the project and associated 
administrative costs. The applicant must contribute at least 25 
percent from non-federal sources. Grants are competitive and 
are awarded based on specific selection criteria.

                          Committee Provisions

    For Rural Cooperative Development Grants, the Committee 
provides an appropriation of $3,000,000, the same as the budget 
request. In fiscal year 1997, $3,000,000 was appropriated for 
this program under the Rural Business-Cooperative Assistance 
Program.
    Of the funds provided, not to exceed $1,300,000 is provided 
for a cooperative agreement for the Appropriate Technology 
Transfer for Rural Areas (ATTRA) program.

             rural business-cooperative assistance program

1997 appropriation......................................     $51,400,000
1998 budget estimate....................................  (1)
Provided in the bill....................................      51,400,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................     +51,400,000

\1\ The Administration proposed funding for this account under the name 
``Rural Community Advancement Program.''

    The Committee consolidates funding for the following 
programs under the Rural Business-Cooperative Assistance 
Program: guaranteed business and industry loans, direct 
business and industry loans, and rural business enterprise 
grants.
    The Rural Business and Industry Loans Program was created 
by the Rural Development Act of 1972, finances a variety of 
rural industrial development loans.
    Rural Industrialization Loans are loans for rural 
industrialization and rural community facilities under Rural 
Development Act amendments to the Consolidated Farm and Rural 
Development Act authorities. Business and industrial loans are 
made to public, private, or cooperative organizations organized 
for profit, to certain Indian tribes, or to individuals for the 
purpose of improving, developing or financing business, 
industry, and employment or improving the economic and 
environmental climate in rural areas. Such purposes include 
financing business and industrial acquisition, construction, 
enlargement, repair or modernization, financing the purchase 
and development of land, easements, rights-of-way, buildings, 
payment of start-up costs, and supplying working capital. 
Industrial development loans may be made in any area that is 
not within the outer boundary of any city having a population 
of 50,000 or more and its immediately adjacent urbanized and 
urbanizing areas with a population density of more than 100 
persons per square mile. Special consideration for such loans 
is given to rural areas and cities having a population of less 
than 25,000.
    Rural Business Enterprise Grants were authorized by the 
Rural Development Act of 1972. Grants are made to public bodies 
and non-profit organizations to facilitate development of small 
and emerging business enterprises in rural areas, including the 
acquisition and development of land; the construction of 
buildings, plants, equipment, access streets and roads, parking 
areas, and utility extensions; refinancing fees; technical 
assistance; and startup operating costs and working capital.

                          Committee Provisions

    For the Rural Business-Cooperative Assistance Program, the 
Committee provides an appropriation of $51,400,000, the same as 
the amount provided in fiscal year 1997.
    The fiscal year 1998 budget request proposed funding for 
the activities under the RB-CAP in the Rural Community 
Advancement Program. Funding for rural cooperative development 
grants and ATTRA was requested as a separate program.
    The Committee has included $500,000 for transportation 
technical assistance and $148,000 for the subsidy costs of 
business and industry loans in empowerment zones and enterprise 
communities, the same amounts as provided in fiscal year 1997.
    The Committee expects the Department to give consideration 
to the following projects requesting assistance under the rural 
business enterprise grants program: The WSOS Community Action 
Commission, Inc. Ohio Rural Enterprise Program; the Alma 
(Georgia) fruit and vegetable facility; the Tri-County Economic 
Development Group (California) regional entrepreneurial 
training program; the City of Red Bluff (California) business 
district revitalization program; the University of Scranton 
business advancement, distance education and training 
infrastructure program for rural northeast Pennsylvania; the 
Lycoming County High Technology Industrial Park in Brady 
Township, Pennsylvania; the revolving loan fund for Southern VI 
Corporation in Huntingburg, Indiana; the revolving loan fund 
for the City of Madison, Indiana; the revolving loan fund for 
the Fayette County (Indiana) Industrial Development Corporation 
and the regional farmers market in Scott County, Virginia; and 
the demonstration projects for energy cooperative development 
by the Cooperative Development Institute in New York, 
Massachusetts and Vermont.
    The Committee expects the Department to consider only those 
applications judged meritorious when subjected to established 
review procedures.

                         SALARIES AND EXPENSES

                                                                                                                
                                                                                Transfer from                   
                                                              Appropriation     loan accounts    Total, RBS, S&E
                                                                                                                
1997 appropriation........................................       $25,680,000        ($654,000)     ($26,334,000)
1998 budget estimate......................................        27,482,000       (3,482,000)      (30,964,000)
Provided in the bill......................................        25,680,000       (3,482,000)      (29,162,000)
Comparison:                                                                                                     
    1997 appropriation....................................  ................      (+2,828,000)      (+2,828,000)
    1998 budget estimate..................................        -1,802,000  (...............                  
                                                                                   ..........)      (-1,802,000)
                                                                                                                

    These funds are used to administer the loan and grant 
programs of the Rural Business-Cooperative Service including 
reviewing applications, making and collecting loans, and 
providing technical assistance and guidance to borrowers; and 
to assist in extending other Federal programs to people in 
rural areas.

                          Committee Provisions

    For Salaries and Expenses of the Rural Business-Cooperative 
Development Service, the Committee provides an appropriation of 
$25,680,000, the same amount as provided in fiscal year 1997 
and a decrease of $1,802,000 below the budget request.

                        Rural Utilities Service

    The Rural Utilities Service (RUS) was established under the 
Federal Crop Insurance Reform and Department of Agriculture 
Reorganization Act of 1994 (Public Law 103-354), October 13, 
1994. RUS administers the electric and telephone programs of 
the former Rural Electrification Administration and the water 
and waste programs of the former Rural Development 
Administration.
    The mission of the RUS is to serve a leading role in 
improving the quality of life in rural America by administering 
its electric, telecommunications, and water and waste programs 
in a service oriented, forward looking, and financially 
responsible manner. All three programs have the common goal of 
modernizing and revitalizing rural communities. RUS provides 
funding and support service for utilities serving rural areas. 
The public-private partnerships established by RUS and local 
utilities assist rural communities in modernizing local 
infrastructure. RUS programs are also characterized by the 
substantial amount of private investment which is leveraged by 
the public funds invested into infrastructure and technology, 
resulting in the creation of new sources of employment.

   RURAL ELECTRIFICATION AND TELECOMMUNICATIONS LOANS PROGRAM ACCOUNT

                          ESTIMATED LOAN LEVEL

1997 loan level.........................................($1,445,000,000)
1998 budget estimate.................................... (1,285,000,000)
Provided in the bill.................................... (1,320,000,000)
Comparison:
    1997 loan level.....................................  (-125,000,000)
    1998 budget estimate................................   (+35,000,000)

    The Rural Electrification Act of 1936 (7 U.S.C. 901 et 
seq.), as amended provides the statutory authority for the 
electric and telecommunications programs.

                          Committee Provisions

    The following table reflects the loan levels for the rural 
electrification and telecommunications loan program account:

----------------------------------------------------------------------------------------------------------------
                                                                                                    Committee   
                                                             FY 1997 enacted  FY 1998 estimate     provisions   
----------------------------------------------------------------------------------------------------------------
Rural electrification and telecommunications loans program                                                      
 account.                                                                                                       
    Loan authorizations: Direct loans:                                                                          
        Electric 5%.......................................    ($125,000,000)    ($125,000,000)    ($125,000,000)
        Telecommunications 5%.............................      (75,000,000)      (40,000,000)      (75,000,000)
                                                           -----------------------------------------------------
          Subtotal........................................     (200,000,000)     (165,000,000)     (200,000,000)
                                                           =====================================================
Treasury rate: Telecommunications.........................     (300,000,000)     (300,000,000)     (300,000,000)
Muni-rate: Electric.......................................     (525,000,000)     (400,000,000)     (400,000,000)
FFB loans:                                                                                                      
    Electric, regular.....................................     (300,000,000)     (300,000,000)     (300,000,000)
    Telecommunications....................................     (120,000,000)     (120,000,000)     (120,000,000)
                                                           -----------------------------------------------------
      Subtotal............................................     (420,000,000)     (420,000,000)     (420,000,000)
                                                           =====================================================
      Total, Loan authorizations..........................  ($1,445,000,000)  ($1,285,000,000)  ($1,320,000,000)
----------------------------------------------------------------------------------------------------------------

        ESTIMATED LOAN SUBSIDY AND ADMINISTRATIVE EXPENSES LEVEL

----------------------------------------------------------------------------------------------------------------
                                                                                                    Committee   
                                                             FY 1997 enacted  FY 1998 estimate     provisions   
----------------------------------------------------------------------------------------------------------------
Loan subsidies: Direct loans:                                                                                   
    Electric 5%...........................................        $3,625,000        $9,325,000        $9,325,000
    Telecommunications 5%.................................         1,193,000         1,568,000         3,136,000
                                                           -----------------------------------------------------
      Subtotal............................................         4,818,000        10,893,000        12,461,000
                                                           =====================================================
Treasury rate: Telecommunications.........................            60,000            60,000            60,000
Muni-rate: Electric.......................................        28,245,000        16,880,000        16,880,000
FFB loans: Regular Electric...............................         2,790,000         2,760,000         2,760,000
                                                           -----------------------------------------------------
      Total, Loan subsidies...............................        35,913,000        30,593,000        32,161,000
                                                           =====================================================
RETLP administrative expenses.............................        29,982,000        34,398,000        34,398,000
      Total, Rural electrification and telecommunications                                                       
       loans program account..............................       $65,895,000       $64,991,000       $66,559,000
(Loan authorization)......................................  ($1,445,000,000)  ($1,320,000,000)  ($1,320,000,000)
----------------------------------------------------------------------------------------------------------------

    The Federal Credit Reform Act of 1990 established the 
Program Account. An appropriation to this account will be used 
to cover the lifetime subsidy costs associated with the direct 
loans obligated and loan guarantees committed in 1998, as well 
as for administrative expenses.

                  RURAL TELEPHONE BANK PROGRAM ACCOUNT

                          ESTIMATED LOAN LEVEL

1997 loan level.........................................  ($175,000,000)
1998 budget estimate....................................   (175,000,000)
Provided in the bill....................................   (175,000,000)
Comparison:
    1997 loan level..........................(.........................)
    1998 budget estimate.....................(.........................)

    The Rural Telephone Bank (RTB) is required by law to begin 
privatization (repurchase of Federally owned stock) in fiscal 
year 1996. RTB borrowers are able to borrow at private market 
rates and no longer require Federal assistance.
    The Rural Telephone Bank is managed by a 13-member board of 
directors. The Administrator of RUS serves as Governor of the 
Bank until conversion to private ownership, control, and 
operation. This will take place when 51 percent of the Class A 
stock issued to the United States and outstanding at any time 
after September 30, 1996, has been fully redeemed and retired. 
Activities of the Bank are carried out by RUS employees and the 
Office of General Counsel of the U.S. Department of 
Agriculture.

                          Committee Provisions

    For the Rural Telephone Bank, the Committee provides for a 
loan level of $175,000,000, the same as the level for fiscal 
year 1997 and the same as the budget request.
    The committee includes the same provision from the fiscal 
year 1997 bill which limits the retirement of the Class A stock 
of the Rural Telephone Bank.

       ESTIMATED LOAN SUBSIDY AND ADMINISTRATIVE EXPENSES LEVELS

                                                                        
                                         Direct loan     Administrative 
                                           subsidy          expenses    
                                                                        
1997 appropriation..................        $2,328,000        $3,500,000
1998 budget estimate................         3,710,000         3,000,000
Provided in the bill................         3,710,000         3,000,000
Comparison:                                                             
    1997 appropriation..............        +1,382,000          -500,000
    1998 budget estimate............  ................  ................
                                                                        

    The Federal Credit Reform Act of 1990 established the 
Program Account. Appropriations to this account will be used to 
cover the lifetime subsidy costs associated with the direct 
loans obligated in 1998, as well as for administrative 
expenses.

      DISTANCE LEARNING AND MEDICAL LINK GRANTS AND LOANS PROGRAM

                                                                                                                
                                                                    Loan level     Subsidy level      Grants    
                                                                                                                
1997 appropriation..............................................    $150,000,000      $1,530,000      $7,470,000
1998 budget estimate............................................     150,000,000          30,000      20,970,000
Provided in the bill............................................     150,000,000          30,000      15,000,000
Comparison:                                                                                                     
    1997 appropriation..........................................  ..............      -1,500,000      +7,530,000
    1998 budget estimates.......................................  ..............  ..............      -5,970,000
                                                                                                                


    The Distance Learning and Medical Link Grants and Loans 
Program was established by the Rural Economic Development Act 
of 1990 (104 STAT. 4017, 7 U.S.C. 950aaa et seq.), as amended 
by the Federal Agriculture Improvement and Reform Act of 1996. 
This program is authorized in the Food, Agriculture, 
Conservation, and Trade Act of 1990 to provide incentives to 
improve the quality of phone services, to provide access to 
advanced telecommunications services and computer networks, and 
to improve rural opportunities.
    This program provides the facilities and equipment to link 
rural education and medical facilities with more urban centers 
and other facilities providing rural residents access to better 
health care through technology and increasing educational 
opportunities for rural students. These funds are available for 
loans and grants.

                          Committee Provisions

    For the Distance Learning and Medical Link Grants and Loans 
Program, the Committee provides an appropriation of 
$15,030,000, an increase of $6,030,000 above the amount 
available for fiscal year 1997 and a decrease of $5,970,000 
below the budget request.
    The Committee expects the Department to give consideration 
to the following projects requesting assistance under the 
Distance Learning and Medical Link program: the Cayuga County 
(New York) Telecommunications Consortium project and the Daemen 
College health care services and training project for Western 
New York.
    The Committee expects the Department to consider only those 
applications judged meritorious when subjected to established 
review procedures.
    The Committee commends the Rural Utilities Service for its 
new regulation regarding the Distance Learning and Medical Link 
program and urges the Department to give careful consideration 
to applications for the program which propose education and 
training uses including the training of people moving from 
welfare to the work force.

                   RURAL UTILITIES ASSISTANCE PROGRAM

1997 appropriation......................................    $566,935,000
1998 budget estimate....................................           (\1\)
Provided in the bill....................................     577,242,000
Comparison:
    1997 appropriation..................................     +10,307,000
    1998 budget estimate................................    +577,242,000

\1\ The Administration proposed funding for this account under the name 
``Rural Community Advancement Program.''

    In 1997, the Congress appropriated funds under the rural 
utilities assistance program to support water and waste 
disposal loans and grants and solid waste management grants and 
the associated administrative expenses. This program, allows 
for greater flexibility to tailor the assistance to the 
applicant's needs.
    The water and waste disposal program is authorized by 
several actions, including sections 306, 306A, 309A, and 310B 
of the Consolidated Farm and Rural Development Act (7 U.S.C. 
1921 et seq., as amended). The program makes loans for water 
and waste disposal development costs. Development loans are 
made to associations, including corporations operating on a 
nonprofit basis, municipalities and similar organization 
generally designated as public or quasi-public agencies, that 
propose projects for the development, storage, treatment, 
purification, and distribution of domestic water or the 
collection, treatment, or disposal of waste in rural areas.
    The program makes grants for water and waste disposal 
development costs. Development grants are made to associations, 
including corporations operating on a nonprofit basis, 
municipalities and similar organizations generally designated 
as public or quasi-public agencies, that propose projects for 
the development, storage, treatment, purification, and 
distribution of domestic water or the collection, treatment, or 
disposal of waste in rural areas. Such grants may not exceed 75 
percent of the development cost of the projects and can 
supplement other funds borrowed or furnished by applicants to 
pay development costs.
    The solid waste grant program is authorized under section 
310(b)(2) of the Consolidated Farm and Rural Development Act, 
as amended. Grants are made to public bodies and private 
nonprofit organizations to provide technical assistance to 
local and regional governments for the purpose of reducing or 
eliminating pollution of water resources and for improving the 
planning of management of solid waste disposal facilities.

                          Committee Provisions

    For the Rural Utilities Assistance Program, the Committee 
provides an appropriation of $577,242,000, an increase of 
$10,307,000 above the amount available for fiscal year 1997. 
The fiscal year 1998 budget request proposed funding for these 
programs under the Rural Community Advancement Program.
    The Committee provides earmarks of $5,200,000 for the 
circuit rider program, $18,700,000 for Colonias along the 
United States-Mexican border, $18,700,000 for direct loans, 
loan guarantees, and grants for empowerment zones and 
enterprise communities, and a continuation of technical 
assistance at the same level as provided in fiscal year 1997 
for water, solid waste, and transportation projects.
    The Committee expects the Department to give consideration 
to the following projects requesting assistance from the rural 
utilities assistance program: construction of wastewater 
treatment facilities for the City of Gridley, California and 
replacement of the water system in Cassopolis, Michigan.
    The Committee expects the Department to consider only those 
applications judged meritorious when subjected to established 
review procedures.

                         SALARIES AND EXPENSES

                                                                                                                
                                                                                Transfer from                   
                                                              Appropriation     loan accounts    Total, RUS, S&E
                                                                                                                
1997 appropriation........................................       $33,195,000     ($33,482,000)     ($66,677,000)
1998 budget estimate......................................        33,000,000      (37,398,000)      (70,398,000)
Provided in the bill......................................        33,000,000      (37,398,000)      (70,398,000)
Comparison:                                                                                                     
    1997 appropriation....................................          -195,000      (+3,916,000)      (+3,721,000)
    1998 budget estimate..................................  ................  (...............                  
                                                                                   ..........)  (...............
                                                                                                     ..........)
                                                                                                                

    These funds are used to administer the loan and grant 
programs of the Rural Utilities Service, including reviewing 
applications, making and collecting loans, and providing 
technical assistance and guidance to borrowers; and to assist 
in extending other Federal programs to people in rural areas.
    Under Credit Reform, administrative costs associated with 
loan programs are appropriation to the program accounts for the 
agricultural credit insurance fund and the rural housing 
insurance fund. Appropriations to the salaries and expenses 
account will be for costs associated with grant programs.

                          Committee Provisions

    For salaries and expenses of the Rural Utilities Service, 
the Committee provides an appropriation of $33,000,000, a 
decrease of $195,000 below the amount available for fiscal year 
1997 and the same as the budget request.

                    TITLE IV--DOMESTIC FOOD PROGRAMS

Office of the Under Secretary for Food, Nutrition and Consumer Services

1997 appropriation......................................        $454,000
1998 budget estimate....................................         560,000
Provided in the bill....................................         454,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................        -106,000

    The Office of the Under Secretary for Food, Nutrition and 
Consumer Services provides direction and coordination in 
carrying out the laws enacted by the Congress with respect to 
the Department's food and consumer activities. The Office has 
oversight and management responsibilities for the Food and 
Consumer Service.

                          committee provisions

    For the Office of the Under Secretary for Food, Nutrition, 
and Consumer Services, the Committee provides an appropriation 
of $454,000, the same as the amount available for fiscal year 
1997 and a decrease of $106,000 below the budget request.

                       Food and Consumer Service

    The Food and Consumer Service (FCS) represents an 
organizational effort to eliminate hunger and malnutrition in 
this country. Food assistance programs are intended to provide 
access to a nutritionally adequate diet for families and 
persons with low incomes, and encourage better eating patterns 
among the nation's children. These programs include:
    Child Nutrition Programs.--Federal assistance is provided 
to the 50 States, Puerto Rico, Virgin Islands, and Guam for use 
in serving nutritious lunches and breakfasts to children 
attending schools of high school grades or under, to children 
of preschool age in child care centers and homes, and to 
children in other institutions in order to improve the health 
and well-being of the nation's children, and broaden the 
markets for agricultural food commodities. Through the special 
milk program, assistance is provided to the states for making 
reimbursement payments to eligible schools and child care 
institutions which institute or expand milk service in order to 
increase the consumption of fluid milk by children.
    Food Stamp Program.--This program is aimed at making more 
effective use of the Nation's food supply and at improving 
nutritional standards of needy persons and families, in most 
cases, through the issuance of food coupons which may be used 
in retail stores for the purchase of food. The program also 
includes nutrition assistance to Puerto Rico. The Omnibus 
Budget Reconciliation Act of 1981 (Public Law 97-35) authorized 
a block grant for nutrition assistance to Puerto Rico which 
gives the Commonwealth broad flexibility in establishing a food 
assistance program that is specifically tailored to the needs 
of its low-income households.
    The program includes the Food Distribution Program on 
Indian Reservations which provides nutritious agricultural 
commodities to low-income persons living on or near Indian 
reservations who choose not to participate in the Food Stamp 
Program. The program also includes $100,000,000 for commodity 
purchases under the Emergency Food Assistance Program.
    Special Supplemental Nutrition Program for Women, Infants, 
and Children (WIC).--This program helps to safeguard the health 
of pregnant, postpartum, and breastfeeding women, and infants, 
and children up to age five who are at nutritional risk by 
providing food packages designed to supplement each 
participant's diet with foods that are typically lacking. 
Delivery of supplemental foods may be done through health 
clinics, vouchers redeemable at retail food stores, or other 
approved methods which a cooperating state health agency may 
select.
    The Commodity Assistance Program (CAP).--This program was 
created by the Agriculture, Rural Development, Food and Drug 
Administration, and Related Agencies Appropriations Act, 1996 
(P.L. 104-37), by consolidating funding for the commodity 
supplemental food program (CSFP), the emergency food assistance 
program (TEFAP), and the soup kitchens and food banks program 
(SK/FB).
    CSFP provides supplemental foods to infants and children up 
to age six, and to pregnant, postpartum, and breastfeeding 
women with low incomes who reside in approved project areas. In 
addition, this program operates commodity distribution projects 
directed at low-income elderly persons.
    TEFAP provides grant funds to state agencies to assist in 
the cost of storage and distribution of donated commodities for 
needy individuals.
    Food Donations Program for Selected Groups.--Nutritious 
agricultural commodities are also provided to residents of the 
Pacific Territory of Palau and Federated States of Micronesia 
and the Marshall Islands. Cash assistance is provided to 
distributing agencies to assist them in meeting administrative 
expenses incurred. Commodities or cash-in-lieu of commodities 
are provided to assist nutrition programs for the elderly.
    Food Program Administration.--This account represents all 
salaries and Federal operating expenses of the Food and 
Consumer Service and the Center for Nutrition Policy and 
Promotion (CNPP). As of September 30, 1996, there were 1,684 
full-time permanent and 78 part-time and temporary employees in 
the agency. There were 583 in the Washington headquarters and 
1,179 in the field, which includes 769 in seven regional 
offices and the balance in six food stamp compliance offices; 
one computer support center in Minneapolis, Minnesota; two 
administrative review offices; and 67 field offices. The Center 
oversees improvements in and revisions to the food nutrition 
guidance systems. CNPP is the focal point for advancing and 
coordinating nutrition promotion and education policy to 
improve the health of all Americans.
    Funds for Strengthening Markets, Income, and Supply 
(Section 32).--This program includes the donation of 
commodities purchased under the surplus removal activities of 
the Agricultural Marketing Service. Special programs provide 
food to needy children and adults who are suffering from 
general and continued hunger.

                        child nutrition programs

                                                                                                                
                                                               Direct         Transfer from      Total program  
                                                           appropriation        section 32           level      
                                                                                                                
1997 appropriation.....................................     $3,219,544,000   ($5,433,753,000)   ($8,653,297,000)
1998 budget estimate...................................      2,631,375,000    (5,151,391,000)    (7,782,766,000)
Provided in the bill...................................      2,548,555,000    (5,218,411,000)    (7,766,966,000)
Comparison:                                                                                                     
    1997 appropriation.................................       -670,989,000     (-215,342,000)     (-886,331,000)
    1998 budget estimate...............................        -82,820,000      (+67,020,000)      (-15,800,000)
                                                                                                                


    Working through state agencies, the Food and Consumer 
Service (FCS) provides Federal assistance in cash and 
commodities for use in preparing and serving nutritious meals 
to children while they are attending school, residing in 
service institutions, or participating in other organized 
activities away from home. The purpose of this program is to 
help maintain the health and proper physical development of 
America's children. The child nutrition account includes the 
school lunch program; the school breakfast program; the summer 
food service program; and child and adult care food programs. 
In addition, the special milk program provides funding for milk 
service in some kindergartens, as well as in schools, nonprofit 
child care centers, and camps which have no other Federally 
assisted food programs. Milk is provided to children either 
free or at a low cost depending on their family income level. 
FCS provides cash subsidies to state administered programs and 
directly administers the program in the states which have 
chosen not to do so. Funds for this program are provided by 
direct appropriation and transfer from section 32. Grants are 
also made for nutritional training and surveys and for state 
administrative expenses. Under current legislation, most of 
these payments are made on the basis of reimbursement rates 
established by law and applied to lunches and breakfasts 
actually served by the states.
    The Child Nutrition and WIC Reauthorization Act of 1989, 
Public Law 101-147, contained a number of child nutrition 
provisions. These include:
    Summer Food Service Program (SFSP).--Reauthorized and 
expanded SFSP to private, nonprofit organizations under certain 
conditions.
    School Breakfast Program (SBP).--Provided start-up grants 
for programs serving low-income children.
    Child and Adult Care Food Program (CACFP).--Provided funds 
for demonstration projects to expand services to homeless 
children and family day care homes in low-income areas.
    National School Lunch Program (NSLP).--(1) Mandated a 
unified system for compliance and accountability which would 
integrate Federal and state efforts and provide for increased 
Federal monitoring of SFSP operations. (2) Authorized the Food 
Service Management Institute to improve school food service 
operations.
    Nutrition Education and Training (NET).--Required 
demonstration projects and studies to examine a number of 
program issues and increased the authorization level.
    Special Milk Program.--Through the special milk program, 
funds are provided to state agencies to reimburse eligible 
participants for all or part of the cost of fluid milk 
consumed. Under Public Law 97-35, participation in the special 
milk program is restricted to schools and institutions that do 
not participate in another meal service program authorized by 
the Child Nutrition or School Lunch Acts. Effective October 1, 
1986, based on authority in Public Law 99-661, children in 
split session kindergarten programs in nonprofit schools who do 
not have access to the meal service programs operating in those 
schools may participate in the program.

                          committee provisions

    For the Child Nutrition Programs, the Committee provides a 
total of $7,766,966,000, a decrease of $886,331,000 below the 
amount available for fiscal year 1997 and a decrease of 
$15,800,000 below the budget request. Of the total amount 
provided, $2,548,555,000 is by direct appropriation and 
$5,218,411,000 is by transfer from section 32. The following 
table reflects the amounts provided by the Committee:

Child Nutrition Programs:
    School lunch program................................  $4,327,804,000
    School breakfast program............................   1,265,507,000
    Child and adult care food program...................   1,411,590,000
    Summer food service program.........................     277,292,000
    Special milk program................................      19,747,000
    State administrative expenses.......................     112,808,000
    Commodity procurement and computer support..........     337,194,000
    School meals initiative.............................       5,900,000
    Coordinated review effort...........................       4,124,000
    Nutrition Education and Training....................       5,000,000
                    --------------------------------------------------------
                    ____________________________________________________
        Total...........................................  $7,766,966,000

    The Committee provides $5,900,000 for the School Meals 
Initiative. Included in this amount is $4,000,000 for food 
service training grants to states; $1,000,000 for technical 
assistance materials; $500,000 for the National Food Service 
Management Institute cooperative agreement for food service; 
and $400,000 for print and electronic food service resource 
systems.
    The Committee has consolidated all funding for studies and 
evaluations under the Economic Research Service.

special supplemental nutrition program for women, infants, and children 
                                 (WIC)

1997 appropriation......................................  $3,805,807,000
1998 budget estimate....................................   4,108,000,000
Provided in the bill....................................   3,924,000,000
Comparison:
    1997 appropriation..................................    +118,193,000
    1998 budget estimate................................    -184,000,000

    The special supplemental nutrition program for women, 
infants, and children (WIC) safeguards the health of pregnant, 
breastfeeding, and postpartum women and infants, and children 
up to age five who are at nutritional risk because of 
inadequate nutrition and inadequate income.
    The Child Nutrition and WIC Reauthorization Act of 1989, 
Public Law 101-147, reauthorized and added a provision to the 
program as follows:
    Cost Containment Initiatives to Expand Participation.--(1) 
Required state agencies with a retail food delivery system to 
use a competitive bidding system or a system with equal savings 
for the procurement of infant formula. Savings are to be used 
to expand program participation. (2) Permitted states with an 
approved cost containment system to use first quarter funds to 
cover obligations incurred during the fourth quarter of the 
preceding fiscal year.
    The WIC farmers' market nutrition program (FMNP) is also 
funded from the WIC appropriation. FMNP is designed to 
accomplish two major goals: (1) to improve the diets of WIC 
participants by providing them with coupons to purchase fresh, 
nutritious, unprepared food, such as fruits and vegetables, 
from farmers' markets; and (2) to increase the awareness and 
use of farmers' markets by low-income households. Funds for the 
WIC program are provided by direct appropriation.

                          committee provisions

    For the Special Supplemental Nutrition Program for Women, 
Infants, and Children (WIC), the Committee provides an 
appropriation of $3,924,000,000, an increase of $118,193,000 
above the amount available for fiscal year 1997 and a decrease 
of $184,000,000 below the budget request. This amount allows 
the program to maintain the current participation level of 7.4 
million pregnant, breastfeeding, and postpartum women and 
infants and children up to age five. The total includes up to 
$12,000,000 for the farmers' market nutrition program.
    The Committee has included two provisions requested by the 
President which gives the Secretary some flexibility in 
distributing WIC funds. The first provision provides for an 
adjustment of fiscal year 1998 state allocations by requiring 
the Secretary to reduce each state allocation by the amount of 
food funds that the state chooses to spend forward from fiscal 
year 1997. The second provision addresses the reallocation of 
fiscal year 1997 recovered funds and allows the Secretary to 
allocate funds first to states to maintain stability funding 
levels and then to states whose funding is less than their fair 
share of funds.
    The Committee has consolidated all funding for studies and 
evaluations under the Economic Research Service.

                           food stamp program

1997 appropriation...................................... $27,618,029,000
1998 budget estimate....................................  27,551,479,000
Provided in the bill....................................  25,140,479,000
Comparison:
    1997 appropriation..................................  -2,477,550,000
    1998 budget estimate................................  -2,411,000,000

    The food stamp program, authorized by the Food Stamp Act of 
1964, attempts to alleviate hunger and malnutrition among low-
income persons by increasing their food purchasing power. 
Eligible households receive food stamps with which they can 
purchase food through regular retail stores. They are thus 
enabled to obtain a more nutritious diet than would be possible 
without food stamp assistance.
    Participating households receive free food stamps in 
amounts determined by household size and income. Since March 
1975, food stamp projects have been established throughout the 
country. State social service agencies assume responsibility 
for certifying eligible households and issuing the stamps 
through suitable outlets. The Food and Consumer Service 
establishes a range of household food stamp allotments which 
are updated annually.
    Authorized grocery stores accept the stamps as payment for 
food purchases and forward them to commercial banks for cash or 
credit. The stamps flow through the banking system to a Federal 
Reserve Bank for redemption out of a special account maintained 
by the U.S. Treasury Department. As the major alternative to 
the paper food stamp system, Electronic Benefit Transfer (EBT) 
is operating statewide in New Mexico, Maryland, South Carolina, 
Texas, and Utah, in parts of Pennsylvania, Minnesota, Ohio, New 
Jersey, Iowa, Kansas, North Dakota, South Dakota, Illinois, and 
Wyoming and is planned in other states.
    The program also includes the Food Distribution Program on 
Indian Reservations which provides nutritious agricultural 
commodities to low-income persons living on or near Indian 
reservations who choose not to participate in the Food Stamp 
Program.

                          administrative costs

    All direct and indirect administrative costs incurred for 
certification of households, issuance of food coupons, quality 
control, outreach, and fair hearing efforts are shared by the 
Federal government and the states on a 50-50 basis.
    In addition, state agencies which reduce quality control 
error rates below 6 percent receive up to a maximum match of 60 
percent of their administrative expenses. Also, state agencies 
are paid up to 100 percent of the costs of administering the 
program on Indian reservations. The food stamp program is in 
operation in all 50 States, the Virgin Islands, Guam, and the 
District of Columbia.
    The Food Stamp Act Amendments of 1982 provided for the 
establishment of a system for levying fiscal sanctions on 
states which fail to reduce high error rates below a prescribed 
target.
    Nutrition Assistance for Puerto Rico.--The Omnibus Budget 
Reconciliation Act of 1981, Public Law 97-35, authorized a 
block grant for nutrition assistance to Puerto Rico which gives 
the Commonwealth broad flexibility in establishing a food 
assistance program which is specifically tailored to the needs 
of its low-income households. Beginning in fiscal year 1987, 
funding for this block grant program was included under the 
food stamp appropriation account.

                          Committee Provisions

    For the Food Stamp Program, the Committee provides an 
appropriation of $25,140,479,000, a decrease of $2,477,550,000 
below the amount available for fiscal year 1997 and a decrease 
of $2,411,000,000 below the budget request. The total amount 
includes $100,000,000 for a contingency reserve in fiscal year 
1998.
    The Committee has consolidated all funding for studies and 
evaluations under the Economic Research Service.
    The Committee is encouraged by the implementation of EBT 
systems around the country and supports the goal that all 
states must be operating an EBT system by 2002. The Committee 
remains concerned about security problems with EBT cards and 
directs the Secretary to report to the Committee on what is 
being done to ensure that EBT cards being issued include anti-
fraud mechanisms such as fine line printing and holograms.
    The Committee believes the agency should focus more on 
preventive strategies to combat retailer trafficking of food 
stamps. Last year, the Committee urged the Food and Consumer 
Service, FCS, to require preauthorization visits for all high 
risk stores. The Committee is disappointed that more 
preauthorization visits have not been required and directs the 
agency to work with its field offices to ensure that all new 
high risk retailer applicants are visited before they are 
authorized to participate in the program.
    In addition, the Committee urges the agency to conduct more 
sweeps to detect ineligible retailers in the program. An 
Inspector General audit found that field offices have accepted 
reauthorization applications without verifying significant 
changes in sales and did not remove prior store owners from the 
Store Tracking and Redemption System database. The Committee 
believes FCS must do more to identify ineligible retailers and 
remove them from the program. Verification of sales changes and 
updating the database are two methods that should be used to 
prevent fraud in the program.
    The Committee also agrees with the Inspector General 
recommendation that the National office needs to provide more 
direction and oversight to regional and field offices and that 
half of all field offices should be reviewed each year. FCS 
established new oversight procedures as a result of an OIG 1992 
retailer audit, but does not enforce them.

                      Commodity Assistance Program

1997 appropriation......................................\1\ $166,000,000
1998 budget estimate.................................... \1\ 272,165,000
Provided in the bill....................................     141,000,000
Comparison:
    1997 appropriation..................................     -25,000,000
    1998 budget estimate................................    -131,165,000

\1\ Includes funding for soup kitchens, the commodity supplemental food 
program, and TEFAP.
\2\ Includes funding for TEFAP, Commodity Supplemental Food Program, 
Elderly Feeding Program and Pacific Island Assistance.

    The Commodity Assistance Program was established in fiscal 
year 1996 by the Agriculture Appropriations Act (P.L. 104-37). 
The Commodity Assistance Program includes: the Commodity 
Supplemental Food Program (CSFP), and administrative expenses 
of The Emergency Food Assistance Program (TEFAP).
    Commodity Supplemental Food Program.--The commodity 
supplemental food program (CSFP) provides supplemental food to 
infants and children up to age six, and to pregnant, 
postpartum, and breast-feeding women who have low incomes, and 
reside in approved project areas. In addition, this program 
operates commodity distribution projects directed at low-income 
elderly persons 60 years of age or older.
    The 1996 FAIR Act (P.L. 104-127) reauthorized the commodity 
supplemental food program through fiscal year 2002. In 
addition, this law requires CCC to donate 4 million pounds of 
nonfat dry milk and 9 million pounds of cheese to the program 
annually, subject to availability.

                          Committee Provisions

    For the Commodity Assistance Program, the Committee 
provides an appropriation of $141,000,000, a decrease of 
$25,000,000 below the amount available for fiscal year 1997 and 
a decrease of $131,165,000 below the budget request. Included 
in the total is funding for administrative expenses of The 
Emergency Food Assistance Program only. Commodity purchases for 
the program are provided within the Food Stamp Program.

              food donations programs for selected groups

1997 appropriation......................................    $141,250,000
1998 budget estimate....................................           (\1\)
Provided in the bill....................................     141,165,000
Comparison:
    1997 appropriation..................................         -85,000
    1998 budget estimate................................    +141,165,000

\1\ The Administration's budget proposes to include $141,165,000 for 
these programs under the Commodity Assistance Program in FY 1998.

    Nutrition Program for the Elderly.--The nutrition program 
for the elderly (NPE) provides cash and commodities to States 
for distribution to local organizations that prepare meals 
served to elderly persons in congregate settings or delivered 
to their homes. The program promotes good health through 
nutrition assistance and by reducing the isolation experienced 
by the elderly. This program is a supplement to the Department 
of Health and Human Services' (DHHS) funding for programs for 
the elderly with cash commodities on a per meal basis for each 
meal served to an elderly person.
    Pacific Island Assistance.--This program provides for a 
directly funded food distribution program for low-income 
individuals in the Pacific Island Territories. This program 
attempts to alleviate hunger and malnutrition in low-income 
households by providing nutritious agricultural commodities to 
eligible persons.

                          Committee Provisions

    For the Food Donations Programs for Selected Groups, the 
Committee provides an appropriation of $141,165,000, a decrease 
of $85,000 below the amount available for fiscal year 1997 and 
the same as the budget request. Included in the amount is 
$140,000,000 for the nutrition program for the elderly.

                      food program administration

1997 appropriation......................................    $106,128,000
1998 budget estimate....................................     105,501,000
Provided in the bill....................................     104,128,000
Comparison:
    1997 appropriation..................................      -2,000,000
    1998 budget estimate................................      -1,373,000

    The food program administration appropriation provides for 
all of the Federal operating expenses of the Food and Consumer 
Service, which includes the child nutrition programs; special 
supplemental nutrition program for women, infants, and children 
(WIC); the commodity assistance program, including the 
commodity supplemental food program, and administrative 
expenses of the emergency food assistance program, the 
nutrition program for the elderly, Pacific Island Assistance, 
and the food stamp program.
    The major objective of food program administration is to 
efficiently and effectively carry out the food assistance 
programs mandated by law. This is to be accomplished by the 
following: (1) giving clear and consistent guidance and 
supervision to state agencies and other cooperators; (2) 
assisting the states and other cooperators by providing 
program, managerial, financial, and other advice and expertise; 
(3) measuring, reviewing, and analyzing progress toward program 
objectives; and (4) carrying out regular staff support 
functions.

                          Committee Provisions

    For Food Program Administration, the Committee provides an 
appropriation of $104,128,000, a decrease of $2,000,000 below 
the amount available for fiscal year 1997 and a decrease of 
$1,373,000 below the budget request. Included in this amount is 
$2,218,000 for the Center for Nutrition Policy and Promotion, 
the same as the amount available for fiscal year 1997.
    The Committee has consolidated all funding for studies and 
evaluations under the Economic Research Service's Food and 
Consumer Economics Division. The Committee does not reduce the 
funding available for studies and evaluations nor does it 
specify which studies to conduct or not conduct. Full 
discretion on how these funds are to be spent has been left to 
the Department. The Committee believes that consolidating these 
funds under ERS is prudent and fiscally responsible. It is 
expected that FCS staff, as well as staff from other agencies, 
will provide input and continue to work with ERS staff to 
assure that all program and policy needs of the Department are 
being met.
    There is some concern that the shift to Electronic Benefits 
Transfer under the nutrition programs, while important in many 
ways, may have the unintended side effect of hurting small 
vendors without access to point-of-sale, POS, terminals, 
particularly farmers' markets. The agency is to report to the 
Committee on how it intends to address this concern.

               Center for Nutrition Policy and Promotion

1997 appropriation......................................................
1998 budget estimate....................................      $2,499,000
Provided in the bill....................................................
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................      -2,499,000

    Pursuant to the Department of Agriculture Reorganization 
Act of 1994 (7 U.S.C. 6901), the Center for Nutrition Policy 
and Promotion was created for the purpose of designing and 
disseminating nutrition education and information to all 
American consumers.

                          Committee Provisions

    The Committee does not provide a separate appropriation for 
the Center for Nutrition Policy and Promotion. The functions of 
this office are retained under food program administration.

            TITLE V--FOREIGN ASSISTANCE AND RELATED PROGRAMS

         Foreign Agricultural Service and General Sales Manager

                                                                                                                
                                                                                 Transfer from                  
                                                                 Appropriation   loan accounts     Total, FAS   
                                                                                                                
1997 appropriation............................................    $131,295,000    ($4,266,000)    ($135,561,000)
1998 budget estimate..........................................     146,549,000     (4,393,000)     (150,942,000)
Provided in the bill..........................................     131,295,000     (4,266,000)     (135,561,000)
Comparison:                                                                                                     
    1997 appropriation........................................  ..............  (.............                  
                                                                                        .....)  (...............
                                                                                                            ...)
    1998 budget estimate......................................     -15,254,000      (-127,000)     (-15,381,000)
                                                                                                                

    The Foreign Agricultural Service (FAS) was established 
March 10, 1953, by Secretary's Memorandum No. 1320, Supplement 
1. Public Law 83-690, approved August 28, 1954, transferred the 
agricultural attaches from the Department of State to the 
Foreign Agricultural Service.
    The primary function of this organization is to help 
American agriculture in maintaining and expanding foreign 
markets for agriculture products vital to the economic well-
being of the nation. It maintains a worldwide agricultural 
intelligence and reporting service to assist the U.S. 
agricultural industry in its export operations through a 
continuous program of analyzing and reporting foreign 
agricultural production, markets, and policies. It attempts to 
develop foreign markets for U.S. farm products through 
administration of special export programs and through helping 
to secure international trade conditions that are favorable 
toward American products. FAS is also responsible for 
coordinating, planning, and directing the Department's programs 
in international development and technical cooperation in food 
and agriculture formerly carried out by the Office of 
International Cooperation and Development.

                          committee provisions

    For the Foreign Agricultural Service, the Committee 
provides an appropriation of $131,295,000 and transfers of 
$4,266,000 for a total program level of $135,561,000, the same 
as the amount available for fiscal year 1997 and a decrease of 
$15,381,000 below the budget request.
    The Committee does not concur with the Administration's 
request that $10,000,000 for the emerging markets program and 
$9,652,000 for information resource management costs be shifted 
from the Commodity Credit Corporation to direct FAS budget 
expenses. The Committee intends that these costs continue to be 
funded through CCC and expects the Department to continue 
operating the emerging markets program at the fiscal year 1997 
level.
    The Committee does not concur with the request for an 
advance appropriation of $3,000,000 to fund overseas wage and 
price increases and the request to make funds available for 
obligation over two years rather than one year.
    The Committee believes that the funding provided to the 
Foreign Agricultural Service will enable the foreign market 
development/cooperator program to operate at the same level as 
fiscal year 1997.
    The Committee recommends that FAS seek an increase in cost-
sharing from participants in the Foreign Market Development/
Cooperator Program.
    The Committee also recommends that FAS not expend scarce 
resources on a market access barrier identification project. 
The Committee notes that the Office of the United States Trade 
Representative produces an annual National Trade Estimates 
report and urges the Department to work with the USTR to avoid 
duplication of efforts.
    The Committee urges the Foreign Agricultural Service to 
consider providing assistance to the University of 
Massachusetts proposal to establish a Model Farm/Agricultural 
Learning Center with China. The Committee expects FAS to use 
established review procedures in considering the request.

                             Public Law 480

                       program and grant accounts

                 public law 480 title I program account

    The Federal Credit Reform Act of 1990 established the 
Program Account. Appropriations to this account are used to 
cover the lifetime subsidy cost associated with direct loans 
obligated in 1998 and beyond, as well as for administrative 
expenses.
    Financing sales of agricultural commodities to developing 
countries and private entities for dollars on credit terms, or 
for local currencies (including for local currencies on credit 
terms) for use under section 104; and for furnishing 
commodities to carry out the Food for Progress Act of 1985, as 
amended (title I).--Title I of the legislation authorizes 
financing of sales to developing countries for local currencies 
and for dollars on credit terms. Sales for dollars or local 
currency may be made to foreign governments. The legislation 
provides for repayment terms either in local currencies or U.S. 
dollars on credit terms of up to 30 years, with a grace period 
of up to 5 years.
    Local currencies under title I sales agreements may be used 
in carrying out activities under section 104 of the 
Agricultural Trade Development and Assistance Act of 1954, as 
amended. Activities in the recipient country for which these 
local currencies may be used include developing new markets for 
U.S. agricultural commodities, paying U.S. obligations, and 
supporting agricultural development and research.
    Title I appropriated funds may also be used under the Food 
for Progress Act of 1985, as amended, to furnish commodities on 
credit terms or on a grant basis to assist developing countries 
and countries that are emerging democracies that have a 
commitment to introduce and expand free enterprise elements in 
their agricultural economies.
    Ocean freight differential costs in connection with 
commodities sales financed for local currencies or U.S. dollars 
(title I).--The Commodity Credit Corporation pays ocean freight 
differential costs on shipments under this title. These costs 
are the difference between foreign flag and U.S. flag shipping 
costs.
    Commodities supplied in connection with dispositions abroad 
(title II) (7 U.S.C. 1721-1726).--Commodities are supplied 
without cost through foreign governments to combat malnutrition 
and to meet famine and other emergency requirements. 
Commodities are also supplied for nonemergencies through public 
and private agencies, including intergovernmental 
organizations. The Commodity Credit Corporation pays ocean 
freight on shipments under this title, and may also pay 
overland transportation costs to a land-locked country, as well 
as internal distribution costs in emergency situations. The 
funds appropriated for title II are made available to private 
voluntary organizations and cooperatives to assist these 
organizations in meeting administrative and related costs.
    Commodities supplied in connection with dispositions abroad 
(title III).--Commodities are supplied without cost to least 
developed countries through foreign governments for direct 
feeding, development of emergency food reserves, or may be sold 
with the proceeds of such sale used by the recipient country 
for specific economic development purposes. The Commodity 
Credit Corporation may pay ocean freight on shipments under 
this title, and may also pay overland transportation costs to a 
landlocked country, as well as internal distribution costs.

                          committee provisions

    The following table reflects the loan levels, subsidy 
levels, and administrative costs for all Public Law 480 
programs:

----------------------------------------------------------------------------------------------------------------
                                                                                                   Committee    
                                                          FY 1997 enacted    FY 1998 estimate      provisions   
----------------------------------------------------------------------------------------------------------------
Public Law 480 Program Account:                                                                                 
    Title I--Credit sales:                                                                                      
        Program level..................................     ($240,805,000)     ($123,149,000)     ($238,048,000)
        Direct loans...................................      (226,900,000)      (112,899,000)      (225,798,000)
        Ocean freight differential.....................        13,905,000         10,250,000         12,250,000 
    Title II--Commodities for disposition abroad:                                                               
        Program level..................................      (837,000,000)      (837,000,000)      (837,000,000)
        Appropriation..................................       837,000,000        837,000,000        837,000,000 
    Title III--Commodity grants:                                                                                
        Program level..................................       (29,500,000)       (30,000,000)       (30,000,000)
        Appropriation..................................        29,500,000         30,000,000         30,000,000 
    Loan subsidies.....................................       185,589,000         87,869,000        175,738,000 
    Salaries and expenses:                                                                                      
        General Sales Manager..........................         1,035,000          1,066,000          1,035,000 
        FSA............................................           745,000            815,000            745,000 
                                                        --------------------------------------------------------
          Subtotal.....................................         1,780,000          1,881,000          1,780,000 
                                                        ========================================================
          Total, Public Law 480:                                                                                
              Program level............................   ($1,107,305,000)     ($990,149,000)   ($1,105,048,000)
              Appropriation............................    $1,067,774,000       $967,000,000     $1,056,768,000 
----------------------------------------------------------------------------------------------------------------

                    CCC Export Loans Program Account

                                                                        
                                     Guaranteed loan     Administrative 
                                         subsidy            expenses    
                                                                        
1997 appropriation................   \1\ $390,305,000         $3,820,000
1998 budget estimate..............    \2\ 527,546,000          3,975,000
Provided in the bill..............        527,546,000          3,820,000
Comparison:                                                             
    1997 appropriation............       +137,241,000  .................
    1998 budget estimate..........  .................           -155,000
                                                                        
                                                                        
                                                                        
\1\ In 1997, the subsidy required will be financed by funding derived   
  from the 1996 subsidy reestimate.                                     
\2\ In 1998, $181,506,000 will be financed by funding derived from the  
  1996 subsidy reestimate.                                              


    Under the export credit programs, guarantees are provided 
by CCC for the repayment of commercial credit extended to 
finance U.S. agricultural export sales. The GSM-102 program 
covers export credit with repayment terms of up to three years. 
The GSM-103 program provides intermediate-term credit with 
repayment terms of three to ten years. The Agricultural Trade 
Act of 1978, as amended, requires that not less than $5.5 
billion be made available annually from 1996 through 2002 for 
GSM-102 and GSM-103. The FAIR Act provides $200,000,000 for the 
Emerging Markets Export Credit Program.
    The Federal Credit Reform Act of 1990 established the 
Program Account. Appropriations to this account will be used to 
cover the lifetime subsidy costs associated with the loan 
guarantees committed in 1998 and beyond, as well as for 
administrative expenses.
    Funding for the loan subsidy costs of CCC export credit is 
provided through a permanent, indefinite appropriation and not 
by annual appropriation.

      TITLE VI--RELATED AGENCIES AND FOOD AND DRUG ADMINISTRATION

                DEPARTMENT OF HEALTH AND HUMAN SERVICES

                      Food and Drug Administration

                         salaries and expenses

                                                                                                                
                                                                                 User fee                       
                                                             Appropriation       accounts       Total, FDA, S&E 
                                                                                                                
1997 appropriation.......................................      $819,971,000    ($100,931,000)     ($920,902,000)
1998 budget estimate.....................................       750,922,000     (236,813,000)      (987,735,000)
Provided in the bill.....................................       857,971,000     (105,170,000)      (963,141,000)
Comparison:                                                                                                     
    1997 appropriation...................................       +38,000,000      (+4,239,000)      (+42,239,000)
    1998 budget estimate.................................      +107,049,000    (-131,643,000)      (-24,594,000)
                                                                                                                

    The programs of the Food and Drug Administration (FDA) are 
designed to achieve a single overall objective: consumer 
protection. FDA's mission is to ensure that: (1) food is safe, 
pure, and wholesome; (2) human and animal drugs, biological 
products, and medical devices are safe and effective; and (3) 
radiological products and use procedures do not result in 
unnecessary exposure to radiation.
    To accomplish its mission, FDA: (1) sets food and product 
standards; (2) evaluates the safety and efficacy of new drugs 
and medical devices before they are marketed; (3) conducts and 
sponsors research studies to detect health hazards and 
violations of laws or regulations, to improve the agency's base 
of scientific knowledge in toxicology and other disciplines, 
and to promote development of orphan products; (4) informs 
business firms and consumers about FDA-related topics; (5) 
works with state and local agencies to develop programs that 
will supplement or complement those of FDA; (6) maintains 
surveillance over foods, drugs, medical devices and electronic 
products to ensure that they are safe, effective, and honestly 
labeled; and (7) takes legal action where necessary to remove 
violative products from the marketplace and to prosecute firms 
or individuals that violate the law.
    Through its regulation of food, FDA protects and promotes 
the health of nearly every American by monitoring the food 
industry to safeguard against contamination by dangerous 
bacteria and molds and other natural and man-made toxins, and 
by regulating the safe use of veterinary drugs and feed 
additives to protect consumers against hazardous drug residues 
or by-products that may remain in meat. FDA also assures that 
consumers are not victimized by adulteration; promotes 
informative labeling to assist consumers in choosing foods; and 
examines imported foods to see that they meet the same 
standards as domestic products. FDA also provides leadership 
and assistance to the states and local authorities in 
conducting their responsibilities.

                          committee provisions

    For the Food and Drug Administration, the Committee 
provides a program level of $963,141,000, an increase of 
$42,239,000 above the amount available in fiscal year 1997. The 
recommendation includes an increase of $3,676,000 for the 
Prescription Drug User Fee Act and an increase of $563,000 for 
the Mammography Quality Clinic Act. These increases are a 
result of increased user fee collections.
    Again this year the agency has submitted a budget proposal 
that includes major changes in funding resulting from proposed 
user fees. The Administration has yet to provide legislative 
proposals to implement the user fees. The Food and Drug 
Administration is one of the country's most important safety 
agencies. It is disappointing that the Office of Management and 
Budget continues to play budget games with this agency.
    In the past several years, as the agency's responsibilities 
have grown it has become increasingly difficult to track agency 
spending. For fiscal year 1997, the Committee provided specific 
amounts of funding for major functions of the agency. For 
fiscal year 1998, the Committee provides the following program 
accounts:

------------------------------------------------------------------------
                                     Fiscal year 1997   Fiscal year 1998
------------------------------------------------------------------------
Foods.............................       $202,639,000       $222,639,000
Human drugs.......................        251,730,000        254,618,000
Biologics.........................        119,609,000        121,398,000
Animal drugs & feeds..............         40,704,000         44,704,000
Medical Devices...................        157,058,000        157,621,000
National Center for Toxicological                                       
 Research.........................         31,307,000         31,307,000
Tobacco...........................          4,914,000         24,279,000
Other services including program                                        
 management.......................         88,741,000         83,810,000
Rent & related activities.........         24,200,000         22,765,000
                                   -------------------------------------
      Total.......................       $920,902,000       $963,141,000
------------------------------------------------------------------------

    Except in the case of an imminent threat to the public 
health or safety, the Committee directs the FDA to provide 
advance written notification to the House and Senate Committees 
on Appropriations when reprogramming any amount from one of 
these line items to another.
    The Committee supports the food safety initiative and has 
provided an increase of $20,000,000 to the Center for Foods and 
$4,000,000 to the Center for Animal Drugs and Feed. It is 
disappointing that the budget presented in February requested 
funding for a Food Safety Initiative, but details of how the 
funds would be used was not decided until May. It would appear 
a dollar figure was decided long before the Administration had 
a plan. Food safety of this country's citizens is a serious 
concern. Treating planning for this activity as an after 
thought to press releases does not put its importance in the 
proper perspective.
    For the program relating to tobacco, the Committee provides 
$24,279,000. The Committee expects the agency to provide semi-
annual reports on the specific use and obligation status of 
these funds.
    The Committee expects the FDA to reduce its costs related 
to other services and program management. These are costs 
incurred by the Office of the Commissioner, Office of Policy, 
Office of External Affairs, Office of Management Systems and 
Central Services. The costs for these functions appears to be 
excessive. For example, the amount available for the Office of 
the Commissioner in fiscal year 1997 was $12,489,000. In 
comparison, the costs for the Office of the Secretary of the 
Department of Agriculture and all the Under and Assistant 
Secretaries totaled less than $11,000,000, even though USDA has 
over 10 times the staff years as FDA. The amount provided in 
the bill for these services is about $5,000,000 less than in 
fiscal year 1997.
    In the past few years, the times for approval of food 
additive petitions and drug and medical device applications 
have improved. Nevertheless, there are statutory requirements 
that are not being met and the Committee expects FDA to meet 
the requirements established in law.
    Health care costs in the country have increased to 
extraordinary levels. One effort that could assist in 
addressing this problem is the quick approval of generic 
products. FDA must assure bioequivalency, but should review 
applications as quickly as possible. The potential for savings 
runs in the billions of dollars. The Committee has provided an 
increase of $1,000,000 for the Office of Generic Drugs to 
assist with accelerated approvals.
    The Committee has provided $200,000 for a grant to the 
Interstate Shellfish Sanitation Commission. These funds should 
be used to assist with shellfish safety rules, regulations, and 
monitoring activities.
    The Committee notes the need for an on-going process of 
ensuring harmonization of international regulatory requirements 
and standards. The FDA should provide a status report on its 
efforts to reach world-wide harmonization.
    The Committee requests that FDA give increased attention to 
the incidence of Hepatitis A outbreaks in the United States and 
to the incidence of potential for Hepatitis A caused by the 
import of fresh fruit and vegetables into the United States.
    The Committee expects the Food and Drug Administration and 
the Substance Abuse and Mental Health Services Administration 
to cooperate and coordinate their efforts to prevent youth 
tobacco usage so as to avoid duplication of effort and to 
ensure efficient and effective use of scarce resources.

                        buildings and facilities

1997 appropriation......................................     $21,350,000
1998 budget estimate....................................      22,900,000
Provided in the bill....................................      21,350,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................      -1,550,000

    The Buildings and Facilities account was established for 
repair and improvement of existing facilities, as well as for 
construction of new facilities when needed.

                          committee provisions

    For Buildings and Facilities of the Food and Drug 
Administration, the Committee provides an appropriation of 
$21,350,000, the same as the amount available for fiscal year 
1997 and a decrease of $1,550,000 below the budget request. The 
amount includes $14,550,000 to continue the modernization of 
the National Center for Toxicological Research.

                         rental payments (fda)

1997 appropriation......................................     $46,294,000
1998 budget estimate....................................      46,294,000
Provided in the bill....................................      46,294,000
Comparison:
    1997 appropriation..................................................
    1998 budget estimate................................................

    Annual appropriations are made to agencies of the Federal 
government so that they can pay the General Services 
Administration fees for rental of space and for related 
services.

                          committee provisions

    For Rental Payments of the Food and Drug Administration, 
the Committee provides an appropriation of $46,294,000, the 
same as the amount available for fiscal year 1997 and the same 
as the budget request.

                       DEPARTMENT OF THE TREASURY

                      Financial Management Service

  Payments to the Farm Credit System Financial Assistance Corporation

1997 appropriation......................................     $10,290,000
1998 budget estimate....................................       7,728,000
Provided in the bill....................................       7,728,000
Comparison:
    1997 appropriation..................................      -2,562,000
    1998 budget estimate................................................

    The Agricultural Credit Act of 1987 (Public Law 100-233) 
authorized such sums as necessary to be appropriated to the 
Secretary of the Treasury for Payment to the Farm Credit System 
Financial Assistance Corporation. These payments reimburse the 
Corporation for interest expenses on U.S. guaranteed debt 
issued by the Corporation. Assistance Corporation debt proceeds 
will be used to provide assistance to financially troubled 
System institutions. Beginning in fiscal year 1989, Treasury 
annually reimburses 100 percent of the Assistance Corporation 
interest expense incurred until January 1994. Between January 
1994 and the ensuing five years, Treasury will reimburse up to 
50 percent of the Assistance Corporation's interest expense, 
with System banks paying the balance. Thereafter all Assistance 
Corporation interest expense will be paid by System banks.

                          committee provisions

    For interest expenses incurred by the Farm Credit System 
Financial Assistance Corporation, the Committee provides an 
appropriation of $7,728,000, a decrease of $2,562,000 below the 
amount available for fiscal year 1997 and the same amount as 
the budget request.

                          Independent Agencies

                  Commodity Futures Trading Commission

1997 appropriation......................................     $55,101,000
1998 budget estimate....................................      60,101,000
Provided in the bill....................................      57,101,000
Comparison:
    1997 appropriation..................................      +2,000,000
    1998 budget estimate................................      -3,000,000

    The Commodity Futures Trading Commission (CFTC) administers 
the Commodity Exchange Act of 1936, as amended. The purpose of 
the Commission is to further the economic utility of futures 
and option markets by encouraging their efficiency, assuring 
their integrity, and protecting participants against abusive 
trade practices, fraud, and deceit. The objective is to enable 
the markets to better serve their designated function in 
providing a price discovery mechanism and as a means of 
offsetting price risk. In properly serving these functions, the 
futures markets contribute toward better planning, more 
efficient distribution and consumption, and more economical 
marketing.

                          committee provisions

    For the Commodity Futures Trading Commission, the Committee 
provides an appropriation of $57,101,000, an increase of 
$2,000,000 above the amount available for fiscal year 1997 and 
a decrease of $3,000,000 below the budget request.

                       Farm Credit Administration

                 limitation on administrative expenses

1997 appropriation......................................   ($37,478,000)
1998 budget estimate....................................    (34,423,000)
Provided in the bill....................................    (34,423,000)
Comparison:
    1997 appropriation..................................    (-3,055,000)
    1998 budget estimate.....................(.........................)

    The Farm Credit Administration (FCA) originally created by 
Executive Order No. 6084 on May 27, 1933, was transferred to 
the Department of Agriculture on July 1, 1939, by 
Reorganization Plan No. 1. From December 4, 1953 to January 23, 
1986, the Administration was an independent agency under the 
direction of a Federal Farm Credit Board (12 U.S.C. 636). The 
Farm Credit Amendments Act of 1985 (P.L. 99-205) clarified the 
FCA's role as an arm's-length financial regulator, granting it 
the same intermediate enforcement powers as other Federal 
financial regulatory agencies. The Act also replaced the 
Federal Farm Credit Board of 13 Presidentially appointed part-
time Board members with the FCA Board, comprised of a Chairman 
and two other Board members, all serving in a full-time 
capacity. Not more than two members of the Board shall be 
members of the same political party.
    The FCA is responsible for regulating, supervising, and 
examining the institutions of the Farm Credit System (System). 
The FCA and the System institutions operate under the authority 
of the Farm Credit Act of 1971 (12 U.S.C. 2001 et seq.). The 
institutions of the System are the Farm Credit banks, Federal 
land bank associations, Federal intermediate credit banks, 
production credit associations, Federal land credit 
associations, agricultural credit associations, and banks for 
cooperatives. The combined lending activities in the System 
institutions provided short- and long-term credit to the 
nation's farmers, ranchers, and producers and harvesters of 
aquatic products, and their cooperatives. System institutions 
are owned by their member borrowers. The operation of the 
System is funded through the sale of systemwide consolidated 
bonds and discount notes in the public money markets, and the 
institutions are fully liable for the payment of these 
securities. The operating expenses of the FCA are paid by the 
System institutions and by the Federal Agricultural Mortgage 
Corporation through assessments, which are deposited in a 
special fund in the Treasury which is available for the use of 
the FCA.

                          Committee Provisions

    For a limitation on the expenses of the Farm Credit 
Administration, the Committee provides $34,423,000, a decrease 
of $3,055,000 below the amount available for fiscal year 1997 
level and the same as the budget request.

                     TITLE VII--GENERAL PROVISIONS

    Sections 701 through 720 of the General Provisions 
contained in the accompanying bill for fiscal year 1998 are 
fundamentally the same as those included in last year's 
appropriations bill.
    Section 721. Provides that none of the funds in this Act 
shall be used to carry out an export enhancement program in 
excess of $270,000,000.
    Section 722. Provides that no employee of the Department of 
Agriculture may be detailed or assigned from an agency or 
office funded by this bill to any other agency or office of the 
Department for more than 30 days unless the individual's 
employing agency or office is fully reimbursed by the receiving 
agency or office for the salary and expenses of the employee 
for the period of assignment.
    Section 723. Provides that none of the funds in this Act 
shall be used to transmit questions or responses to questions 
related to information requested for the appropriations hearing 
process to any non-Department of Agriculture employee.
    Section 724. Provides that none of the funds appropriated 
or otherwise made available in this Act may be expended or 
obligated to fund the activities of the Western Director and 
Special Assistant to the Secretary within the office of the 
Secretary of Agriculture or any similar position.
    Section 725. Provides that none of the funds made available 
to the Department of Agriculture by this Act may be used to 
acquire new information technology systems or significant 
upgrades, as determined by the Office of the Chief Information 
Officer, without the approval of the Chief Information Officer 
and the concurrence of the Executive Information Technology 
Investment Review Board.
    Section 726. Provides that none of the funds in this Act 
shall be used to fund the immediate Office of the Deputy and 
Assistant Deputy Administrator for Farm Programs within the 
Farm Service Agency.
    Section 727. Provides that the City of Galt, California 
shall not be considered rural or a rural area for the purposes 
of section 520 of the Housing Act of 1949.

                    Transfer of Unexpended Balances

    Pursuant to clause 1(b), rule X of the House of 
Representatives, the following statement is submitted 
describing the transfer of unexpended balances provided in the 
accompanying bill. Transfers of unexpended balances are 
assigned to the jurisdiction of the Committee on Appropriations 
by clause 1(b)(2) of rule X.
    1. Office of the Secretary.--The bill allows the transfer 
of unobligated balances of representation funds in the Foreign 
Agricultural Service to the Office of the Secretary.
    2. Agriculture Buildings and Facilities and Rental 
Payments.--The bill allows transfers to or from the rental 
payments account based on changing space requirements.
    3. Hazardous Waste Management.--The bill allows the funds 
appropriated to the Department for hazardous waste management 
to be transferred to agencies of the Department as required.
    4. Departmental Administration.--The bill allows 
reimbursement for expenses related to certain hearings.
    5. Office of the Assistant Secretary for Congressional 
Relations.--The bill allows the funds appropriated to the 
Office of the Assistant Secretary to be transferred to 
agencies.
    6. Office of the Inspector General.--Authority is provided 
to transfer funds to the Office of the Inspector General from 
the Department of Justice Assets Forfeiture Fund or the 
Department of Treasury Forfeiture Fund.
    7. Animal and Plant Health Inspection Service.--Authority 
is included to enable the Secretary of Agriculture to transfer 
from other appropriations or funds of the Department such sums 
as may be necessary to combat emergency outbreaks of certain 
diseases of animals, plants, and poultry.
    8. Agricultural Marketing Service.--The bill limits the 
transfer of section 32 funds to purposes specified in the bill.
    9. Farm Service Agency.--The bill provides that funds 
provided to other accounts in the agency may be merged with the 
salaries and expenses account of the Farm Service Agency.
    10. Dairy Indemnity Program.--The bill authorizes the 
transfer of funds to the Commodity Credit Corporation.
    11. Agricultural Credit Insurance Fund.--The bill provides 
that funds from the account shall be transferred to the Farm 
Service Agency salaries and expenses account.
    12. Rural Housing Insurance Fund Program Account; Rural 
Development Loan Program Account; and Rural Electrification and 
Telecommunications Loan Program Account.--The bill provides 
that administrative funds may be transferred to various 
salaries and expenses accounts.
    13. Rural Housing Assistance Program; Rural Business-
Cooperative Assistance Program; and Rural Utilities Assistance 
Program.--The bill allows funds to be transferred between 
authorized programs within the account.
    14. Rural Economic Development Loans Program Account.--
Language is included that allows for transfer of cushion of 
credit payments to this account.
    15. Child Nutrition Programs.--The bill includes authority 
to transfer section 32 funds to these programs.
    16. Foreign Agricultural Service.--The bill allows for the 
transfer of funds from the Commodity Credit Corporation Export 
Loan Program Account and Public Law 480 Program Account.
    17. Public Law 480.--The bill allows for the transfer of up 
to 15 percent of the funds between titles I, II, and III.
    18. Commodity Credit Corporation Export Loans Program.--The 
bill provides for transfer of funds to the Foreign Agricultural 
Service and to the Farm Service Agency for overhead expenses 
associated with credit reform.
    19. Rental Payments (FDA).--The bill allows transfer to or 
from the rental payments account based on changing space 
requirements.

               Changes in the Application of Existing Law

    Pursuant to clause 3, rule XXI of the House of 
Representatives, the following statements are submitted 
describing the effect or provisions in the accompanying bill 
which directly or indirectly change the application of existing 
law. In most instances, these provisions have been included in 
prior appropriations bills, often at the request of or with the 
knowledge and consent of the responsible legislative 
committees.
    Language is included in various parts of the bill to 
continue ongoing activities of those Federal agencies which 
require annual authorization or additional legislation which to 
date has not been enacted.
    Language is included in the bill in several accounts that 
earmarks funds for empowerment zones and enterprise communities 
as authorized by title XIII of the Omnibus Budget 
Reconciliation Act of 1993.
    The bill includes a number of provisions which place 
limitations on the use of funds in the bill or change existing 
limitations and which might, under some circumstances, be 
construed as changing the application of existing law:
    1. Office of the Secretary.--Language is included to limit 
the amount of funds for official reception and representation 
expenses, as determined by the Secretary.
    2. Agriculture Buildings and Facilities and Rental 
Payments.--Language is included which allows the transfer of 
limited amounts to and from this account.
    3. Departmental Administration.--Language is included to 
reimburse the agency for travel expenses incident to the 
holding of hearings.
    4. Inspector General.--Language is included to allow the 
Inspector General to use funds transferred through forfeiture 
proceedings for authorized law enforcement activities.
    5. National Agricultural Statistics Service.--Language is 
included to provide the Secretary the authority to conduct the 
Census of Agriculture.
    6. Agricultural Research Service.--The bill includes 
language that prohibits funds from being used to carry out 
research related to the production, processing or marketing of 
tobacco or tobacco products.
    7. Cooperative State Research, Education, and Extension 
Service.--The bill includes language that prohibits funds from 
being used to carry out research related to the production, 
processing or marketing of tobacco or tobacco products.
    8. Animal and Plant Health Inspection Service.--A provision 
carried in the bill since fiscal year 1973 regarding state 
matching funds has been continued to assure more effective 
operation of the brucellosis control program through state cost 
sharing, with resulting savings to the Federal budget.
    Language is included to allow APHIS to recoup expenses 
incurred from providing training to non-APHIS personnel.
    9. Grain Inspection, Packers and Stockyards Administration, 
Inspection and Weighing Services.--The bill includes authority 
to exceed the limitation on inspection and weighing services by 
10 percent with notification to the Appropriations Committees. 
This allows for flexibility if export activities require 
additional supervision and oversight, or other uncontrollable 
factors occur.
    10. Agricultural Marketing Service.--The bill includes 
language that allows the Secretary to charge user fees for AMS 
activity related to preparation of standards.
    11. Agricultural Marketing Service, Limitation on 
Administrative Expenses.--The bill includes language to allow 
AMS to exceed the limitation on administrative expenses by 10 
percent with notification to the Appropriations Committees. 
This allows flexibility in case crop size is understated and/or 
other uncontrollable events occur.
    12. Dairy Indemnity Program.--Language is included that 
allows the Secretary to utilize the services of the Commodity 
Credit Corporation for the purpose of making dairy indemnity 
payments.
    13. Commodity Credit Corporation Fund, Reimbursement for 
Net Realized Losses.--Language is included to provide for the 
reimbursement appropriation. Language is also included which 
limits the amount of funds that can be spent on operation and 
maintenance costs of CCC hazardous waste sites.
    14. Risk Management Agency.--Language is included to limit 
the amount of funds for official reception and representation 
expenses.
    15. Natural Resources Conservation Service--Conservation 
Operations.--This language, which has been included in the bill 
since 1938, prohibits construction of buildings on land not 
owned by the government, although construction on land owned by 
states and counties is authorized by basic law. This paragraph 
also includes language carried in the bill since 1950, which 
prohibits the use of funds for demonstration projects 
authorized by the Act of April 27, 1935.
    16. Watershed and Flood Prevention Operations.--Language, 
which was also included in the Emergency Jobs Bill and all 
bills since 1984, provides that funds may be used for 
rehabilitation of existing works.
    17. Rural Housing Service--Rental Assistance Program.--
Language is included which provides that agreements entered 
into during fiscal year 1998 be funded for a five-year period.
    18. Rural Electrification and Telecommunications Loan 
Program Account.--Language is included to allow borrowers' 
interest rates for electric loans to exceed seven percent.
    19. Rural Economic Development Loans Program Account.--
Language is included that allows for transfer of cushion of 
credit payments to this account.
    20. Child Nutrition Programs.--Language is included to 
prohibit funds from being used for studies and evaluations.
    21. Special Supplemental Nutrition Program for Women, 
Infants, and Children (WIC).--Language is included to prohibit 
funds from being used for studies and evaluations.
    22. Food Stamp Program.--Language is included to prohibit 
funds from being used for studies and evaluations.
    23. Foreign Agricultural Service.--Language carried since 
1979 enables this organizational unit to utilize funds received 
by an advance or by reimbursement to carry out its activities 
involving international development and technical cooperation.
    The bill includes language that prohibits funds from being 
used to promote the sale or export of tobacco or tobacco 
products. Language is included to limit the amount of funds for 
official reception and representation expenses.
    24. Food and Drug Administration.--Language included since 
1986 prohibits any user fee authorized by 31 U.S.C. 9701.
    25. Rental Payments (FDA).--Language included since 1985 
allows transfer of limited amounts to and from this account.
    26. Commodity Futures Trading Commission.--Language is 
included to allow CFTC to recoup expenses incurred from 
providing training to non-CFTC personnel.
    27. General Provisions.--
          Section 704: This provision repeats language carried 
        since 1972 which permits the accumulation of growth 
        capital not to exceed $2,000,000, and which provides 
        that no funds appropriated to an agency shall be 
        transferred to the Working Capital Fund without the 
        approval of the agency administrator.
          Section 705: This provision, carried since 1976, is 
        again included which provides that certain 
        appropriations in this Act shall remain available until 
        expended where the programs or projects involved are 
        continuing in nature under the provisions of 
        authorizing legislation, but for which such legislation 
        does not specifically provide for extended 
        availability. This authority tends to result in savings 
        by preventing the wasteful practice often found in 
        government of rushing to commit funds at the end of the 
        fiscal year without due regard to the value of the 
        purpose for which the funds are used. Such extended 
        availability is also essential in view of the long lead 
        time frequently required to negotiate agreements or 
        contracts which normally extend over a period of more 
        than one year. Under these conditions such authority is 
        commonly provided in Appropriations Acts where omitted 
        from basic law. These provisions have been carried 
        through the years in this Act to facilitate efficient 
        and effective program execution and to assure maximum 
        savings. They involve the following items: Animal and 
        Plant Health Inspection Service, the contingency fund 
        to meet emergency conditions, fruit fly program, the 
        reserve fund for integrated systems acquisition 
        project, the boll weevil program, and up to 10 percent 
        of the screwworm program; Food Safety and Inspection 
        Service, field automation and information management 
        project; Cooperative State Research, Education, and 
        Extension Service, funds for the Native American 
        institutions endowment fund and competitive research 
        grants; Foreign Agricultural Service, middle-income 
        country training program; Farm Service Agency, salaries 
        and expenses to county committees; National 
        Agricultural Statistics Service, Census of Agriculture; 
        and funds appropriated for rental payments.
          Section 708: This provision, included since fiscal 
        year 1981, limits the overhead that can be charged on 
        cooperative agreements to a maximum of 10 percent. This 
        provision is necessary because many universities 
        attempted to apply the same overhead rates to 
        cooperative agreements as was being applied to grants 
        and contracts, without giving consideration to the 
        cooperator's contributions as an offset to the overhead 
        charges.
          Section 710: This provision, carried since 1983, 
        provides that none of the funds in this Act shall be 
        available to reimburse the General Services 
        Administration for rental payment in excess of the 
        amounts specified in the Act.
          Section 711: This provision, added in 1987, provides 
        that none of the funds in this Act may be used to 
        restrict the authority of CCC to lease space. This 
        provision allows CCC to continue to lease space at a 
        lower cost than space leased by GSA.
          Section 712: This provision, added in 1990, provides 
        that none of the funds in this Act may be made 
        available to pay indirect costs on competitive research 
        grants awarded by the Cooperative State Research, 
        Education, and Extension Service in excess of 14 
        percent of total direct costs, except for grants 
        available under the Small Business Innovation and 
        Development Act.
          Section 713: This provision clarifies that loan 
        levels provided in the Act are to be considered 
        estimates and not limitations. The Federal Credit 
        Reform Act of 1990 provides that the appropriated 
        subsidy is the controlling factor for the amount of 
        loans made and that as lifetime costs and interest 
        rates change, the amount of loan authority will 
        fluctuate.
          Section 714: This provision allows funds made 
        available in fiscal year 1998 for the Rural Development 
        Loan Fund Program Account; Rural Telephone Bank Program 
        Account; the Rural Electrification and 
        Telecommunications Loans Program Account; and the Rural 
        Economic Development Loans Program Account to remain 
        available until expended. The Credit Reform Act 
        requires that the lifetime costs of loans be 
        appropriated. Current law requires that funds 
        unobligated after five years expire. The life of some 
        loans extends well beyond the five-year period and this 
        provision allows funds appropriated to remain available 
        until the loans are closed out.
          Section 715: This provision provides that sums 
        necessary for fiscal year 1998 pay raises shall be 
        absorbed within the levels appropriated in this Act.
          Section 716: This provision, added in fiscal year 
        1994, provides for compliance with the Buy American 
        Act.
          Section 717: This provision provides that the 
        Agricultural Marketing Service and the Animal and Plant 
        Health Inspection Service may use cooperative 
        agreements.
          Section 718: Provides that not more than 5 percent of 
        Class A stock of the Rural Telephone Bank may be 
        retired in fiscal year 1998. The provision also 
        prohibits the maintenance of any account or subaccount 
        which has not been specifically authorized by law. The 
        provision also prohibits a transfer of any unobligated 
        funds of the Rural Telephone Bank telephone liquidating 
        account to the Treasury or the Federal Financing Bank 
        that are in excess of current requirements.
          Section 719: Provides that none of the funds in this 
        Act may be used to provide market promotion/market 
        access program assistance to the U.S. Mink Export 
        Development Council or any mink industry trade 
        association.
          Section 720: Provides that of the funds made 
        available, not more than $1,000,000 shall be used to 
        cover expenses of activities related to all advisory 
        committees, panels, commissions, and task forces of the 
        Department of Agriculture except for panels used to 
        comply with negotiated rule makings and panels used to 
        evaluate competitive award grants.
          Section 721: Provides that none of the funds in this 
        Act shall be used to carry out an export enhancement 
        program in excess of $270,000,000.
          Section 722: This provision prohibits any employee of 
        the Department of Agriculture from being detailed or 
        assigned to any other agency or office of the 
        Department for more than 30 days unless the 
        individual's employing agency or office is fully 
        reimbursed by the receiving agency or office for the 
        salary and expenses of the employee for the period of 
        assignment.
          Section 723: This provision prohibits the Department 
        of Agriculture from transmitting or making available to 
        any non-Department of Agriculture employee questions or 
        responses to questions that are a result of information 
        requested for the appropriations hearing process.

                  Compliance With Rule XIII, Clause 3

    In compliance with clause 3 of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter printed in italic, existing law in which no change is 
proposed is shown in roman):
    Section 520 of the Housing Act of 1949 (42 U.S.C. 1490)
          * * * * * * *

                   TITLE 42, UNITED STATES CODE 1490

          * * * * * * *
    As used in this subchapter, the terms ``rural'' and ``rural 
area'' mean any open country, or any place, town, village, or 
city which is not (except in the cases of Pajaro, in the State 
of California, and guadalupe, in the State of Arizona) part of 
or associated with an urban area and which (1) has a population 
not in excess of 2,500 inhabitants, or (2) has a population in 
excess of 2,500 but not in excess of 10,000 if it is rural in 
character, or (3) has a population in excess of 10,000 but not 
in excess of 20,000, and (A) is not contained within a standard 
metropolitan statistical area, and (B) has a serious lack of 
mortgage credit for lower and moderate-income families, as 
determined by the Secretary and the Secretary of Housing and 
Urban Development. For purposes of this subchapter, any area 
classified as ``rural'' or a ``rural area'' prior to October 1, 
1990, and determined not to be ``rural'' or a ``rural area'' as 
a result of data received from or after the 1990 decennial 
census shall continue to be so classified until the receipt of 
data from the decennial census in the year 2000, if such area 
has a population in excess of 10,000 but not in excess of 
25,000, is rural in character, and has a serious lack of 
mortgage credit for lower and moderate-income families. 
Notwithstanding any other provision of this section, the city 
of Plainview, Texas, shall be considered a rural area for 
purposes of this subchapter, and the City of Galt, California, 
shall not be considered rural or a rural area for purposes of 
this title.

                  Appropriations Not Authorized By Law

    Pursuant to clause 3 of rule XXI of the House of 
Representatives, the following table lists the appropriations 
in the accompanying bill which are not authorized by law:

          Section 515, Multi-Family Housing,
          Section 538 Guaranteed Multiple Family Housing,
          Dairy Indemnity Program,
          Prescription Drug User Fees,
          Elderly Feeding Program,
          Food Assistance for the Nuclear-Affected Islands.

                   Comparison With Budget Resolution

    Section 308(a)(1)(A) of the Congressional Budget and 
Impoundment Control Act of 1974 (Public Law 93-344), as 
amended, requires that the report accompanying a bill providing 
new budget authority contains a statement detailing how the 
authority compares with the reports submitted under section 602 
of the Act for the most recently agreed to concurrent 
resolution on the budget for the fiscal year. This information 
follows:

                                            [In millions of dollars]                                            
----------------------------------------------------------------------------------------------------------------
                                                                     602(b) allocation           This bill      
                                                                 -----------------------------------------------
                       Full committee data                          Budget                  Budget              
                                                                   authority    Outlays    authority    Outlays 
----------------------------------------------------------------------------------------------------------------
Comparison with Budget Resolution:                                                                              
    Discretionary...............................................     $13,651     $13,967     $13,650     $13,966
    Mandatory...................................................      35,048      35,205      35,797      35,205
                                                                 -----------------------------------------------
      Total.....................................................     $48,699     $49,172     $49,447     $49,171
----------------------------------------------------------------------------------------------------------------

    The bill provides no new spending authority as described in 
section 401(c)(2) of the Congressional Budget and Impoundment 
Control Act of 1974 (Public Law 93-344), as amended.

                    Five-Year Projection of Outlays

    In compliance with section 308(a)(1)(C) of the 
Congressional Budget and Impoundment Control Act of 1974 
(Public Law 93-344), as amended, the following table contains 
five-year projections associated with the budget authority 
provided in the accompanying bill:

------------------------------------------------------------------------
                                                    Budget              
              Five year projections                authority    Outlays 
------------------------------------------------------------------------
Budget Authority................................     $49,447  ..........
Outlays:                                                                
    1998........................................  ..........     $41,682
    1999........................................  ..........       5,360
    2000........................................  ..........         566
    2001........................................  ..........         270
    2002 and beyond.............................  ..........         465
------------------------------------------------------------------------

    The bill provides no new revenues or tax expenditures, and 
will have no effect on budget authority, budget outlays, 
spending authority, revenues, tax expenditures, direct loan 
obligations, or primary loan guarantee commitments available 
under existing law for fiscal year 1997 and beyond.

          Financial Assistance to State and Local Governments

    In accordance with section 308(a)(1)(D) of the 
Congressional Budget and Impoundment Control Act of 1974 
(Public Law 93-344), as amended, the financial assistance to 
state and local governments is as follows:

                        [In millions of dollars]

New budget authority....................................     $16,440,000
Fiscal year 1998 outlays resulting therefrom............      15,036,000

                     Program, Project, and Activity

    During fiscal year 1998, for purposes of the Balanced 
Budget and Emergency Deficit Control Act of 1985 (Public Law 
99-177), the following information provides the definition of 
the term ``program, project, and activity'' for departments and 
agencies under the jurisdiction of the Agriculture, Rural 
Development, Food and Drug Administration, and Related Agencies 
Subcommittee. The term ``program, project, and activity'' shall 
include the most specific level of budget items identified in 
the Agriculture, Rural Development, Food and Drug 
Administration, and Related Agencies Appropriations Act of 
1998, the House and Senate Committee reports, and the 
conference report and accompanying joint explanatory statement 
of the managers of the committee of conference.
    If a Sequestration Order is necessary, in implementing the 
required Presidential Order, departments and agencies shall 
apply any percentage reduction for fiscal year 1998 pursuant to 
the provisions of Public Law 99-177 to all items specified in 
the explanatory notes submitted to the Committees on 
Appropriations of the House and Senate in support of the fiscal 
year 1998 budget estimates, as amended, for such departments 
and agencies, as modified by congressional action, and in 
addition:
    For the Agricultural Research Service the definition shall 
include specific research locations as identified in the 
explanatory notes and lines of research specifically identified 
in the reports of the House and Senate Appropriations 
Committees.
    For the Natural Resources Conservation Service the 
definition shall include individual flood prevention projects 
as identified in the explanatory notes and individual 
operational watershed projects as summarized in the notes.
    For the Farm Service Agency the definition shall include 
individual state, district, and county offices.

                          Full Committee Votes

    Pursuant to the provisions of clause 2(l)(2)(b) of rule XI 
of the House of Representatives, the results of each rollcall 
vote on an amendment or on the motion to report, together with 
the names of those voting for and those voting against, are 
printed below:

                             ROLLCALL No. 1

    Date: July 9, 1997.
    Measure: FY 1998 Agriculture Appropriations Bill.
    Motion by: Mr. Nethercutt.
    Description of motion: To prohibit funding of the office of 
the Deputy and Assistant Deputy Administrator for Farm Programs 
in the Farm Service Agency.
    Results: Adopted; 28 yeas, 21 nays.
        Members Voting Yea            Members Voting Nay
Mr. Aderholt                        Ms. DeLauro
Mr. Bonilla                         Mr. Fazio
Mr. Callahan                        Mr. Hefner
Mr. Cunningham                      Mr. Hoyer
Mr. Forbes                          Miss Kaptur
Mr. Frelinghuysen                   Mrs. Lowey
Mr. Hobson                          Mrs. Meek
Mr. Istook                          Mr. Moran
Mr. Kingston                        Mr. Obey
Mr. Knollenberg                     Mr. Olver
Mr. Kolbe                           Mr. Pastor
Mr. Latham                          Ms. Pelosi
Mr. Lewis                           Mr. Porter
Mr. Livingston                      Mr. Price
Mr. McDade                          Mr. Sabo
Mr. Miller                          Mr. Serrano
Mr. Nethercutt                      Mr. Skaggs
Mrs. Northup                        Mr. Stokes
Mr. Packard                         Mr. Torres
Mr. Parker                          Mr. Visclosky
Mr. Skeen                           Mr. Yates
Mr. Taylor
Mr. Tiahrt
Mr. Walsh
Mr. Wamp
Mr. Wicker
Mr. Wolf
Mr. Young



 ADDITIONAL VIEWS OF HONORABLE MARCY KAPTUR, HONORABLE DAVID R. OBEY, 
  HONORABLE JOSE E. SERRANO, HONORABLE ROSA L. DeLAURO and HONORABLE 
                              DAVID PRICE

    Overall, the fiscal year 1998 Agriculture, Rural 
Development, Food and Drug Administration, and Related Agencies 
appropriations bill represents a fair and bipartisan approach, 
incorporating a wide range of priorities for Members of the 
Committee. We are supportive of funding levels recommended for 
many vitally important programs in this bill, including 
important nutrition programs such as the Special Supplemental 
Nutritional Program for Women, Infants, and Children (WIC). We 
also note that increases are provided for the Food Safety 
initiative under both the Department of Agriculture (USDA) and 
the Food and Drug Administration (FDA), as well as the Youth 
Tobacco Prevention initiative proposed under FDA. While these 
programs are not funded at the full amount requested, the 
Committee has allocated additional resources to programs that 
primarily protect the most vulnerable in our society--our 
children.
    For the most part, the bill represents a bipartisan 
approach on behalf of the Subcommittee chairman, and as 
reported out of subcommittee, the bill contained no extraneous 
or controversial riders.
    We remain concerned about some of the reductions proposed 
for salary accounts under the Department of Agriculture, 
particularly reductions in the Farm Service Agency, and the 
potential for disruption of the delivery of programs and 
services provided by these agencies. We intend to work with 
USDA to evaluate the impact of these reductions and will work 
to make any necessary improvements in funding levels as the 
bill continues to move through the process.
    While some of our concerns about the bill were addressed 
through amendments at the Full Committee, there were several 
amendments adopted that cause us to question our continuing 
support for the bill.
    In the bill reported by the Subcommittee, $152 Million was 
provided for sales commissions paid to private crop insurance 
agents. At Full Committee, the Chairman's en bloc amendment 
included a further increase of $36 Million for crop insurance 
sales commissions. We feel that there are many other programs 
in this bill that are of a higher priority than underwriting 
private insurance agents, particularly in light of a report 
from the General Accounting office released in April of this 
year, as well as a proposal by the Administration to lower the 
commission rate from 28 percent to 24.5 percent.
    In its April report, the GAO stated that some expenses 
reimbursed with taxpayer funds under the crop insurance sales 
commission program appeared excessive or did not appear to be 
reasonably associated with the sale and service of Federal crop 
insurance. These include: agents' commissions that exceeded the 
industry average, unnecessary travel-related expenses, 
questionable entertainment activities, expenses associated with 
buying competitors' businesses, profit-sharing bonuses, and 
lobbying. GAO suggested that future reimbursement rates could 
be reduced. Consequently, USDA indicated to the Committee that 
$152 Million would be sufficient funding for this program for 
fiscal year 1998, and that these funds would provide assurance 
that valuable crop insurance products would be delivered by 
private insurance companies and their agents. We strongly 
support the crop insurance program as a continuing safety net 
for our nation's producers, but believe that a 24.5 percent 
level of commission should be sufficient to encourage private 
companies to provide this service. Providing an additional $36 
Million increase to raise those commissions from 24.5 percent 
to about 27 percent of the value of the insurance policy is 
simply not the highest priority use of this Subcommittee's 
limited funding allocation.
    We also strongly oppose the amendment adopted by the Full 
Committee that would eliminate the positions of the Deputy and 
Assistant Deputy Administrator of the Farm Service Agency. 
While we realize that farmers and landowners in Washington 
state are disappointed with the results of the most recent 
Conservation Reserve Program sign-up, we strongly oppose this 
punitive attempt to affect a change in program management 
through micro-management of a Federal agency.
    We are concerned about an amendment which seems to give 
special preference and consideration to one university building 
under the Cooperative State Research, Education and Extension 
Buildings and Facilities account. With limited Federal funding 
available for priority programs, this Subcommittee agreed in 
fiscal year 1997 that it could no longer continue to try to 
meet the demand for building academic research facilities. 
While we followed this approach in Subcommittee markup and 
provided no funding for this account, the amendment adopted at 
Full Committee subverts an established process. It appears to 
give preference to one university, however valid its 
requirements may be, while disallowing other priority proposals 
from consideration.
    We are also concerned about an amendment adopted by the 
Committee that would change the designation of a community in 
California from rural to urban. We have strong reservations 
about the intent of this language, and the unintended 
consequences that may result. We strongly urge that this 
language be removed.
    Overall, we are pleased with many of the recommendations 
made in this bill. We think it represents, for the most part, a 
fair and thoughtful distribution of the limited resources 
available to the Subcommittee and we intend to work to improve 
the bill as the process continues.

                                   David Price.
                                   Marcy Kaptur.
                                   Jose E. Serrano.
                                   David R. Obey.
                                   Rosa L. DeLauro.



                               I N D E X

                              ----------                              

   Agriculture, Rural Development, Food and Drug Administration, and 
                         Related Agencies, 1998
                              Introduction
                     TITLE I--AGRICULTURAL PROGRAMS
                 Production, Processing, and Marketing

                                                                   Page
Office of the Secretary..........................................     3
Executive Operations.............................................     5
    Office of the Chief Economist................................     5
    Commisson on 21st Century Production Agriculture.............     6
    National Appeals Division....................................     6
    Office of Budget and Program Analysis........................     7
    Office of the Chief Information Officer......................     7
Office of the Chief Financial Officer............................     8
Office of the Assistant Secretary for Administration.............     8
Agriculture Buildings and Facilities and Rental Payments.........     9
Hazardous Waste Management.......................................    10
Departmental Administration......................................    11
Office of the Assistant Secretary for Congressional Relations....    12
Office of Communications.........................................    13
Office of the Inspector General..................................    13
Office of the General Counsel....................................    14
Office of the Under Secretary for Research, Education, and 
  Economics......................................................    14
Economic Research Service........................................    15
National Agricultural Statistics Service.........................    15
Agricultural Research Service....................................    16
    Buildings and Facilities.....................................    21
Cooperative State Research, Education, and Extension Service.....    23
    Research and Education Activities............................    23
    Native American Institutions Endowment Fund..................    29
    Extension Activities.........................................    29
    Buildings and Facilities.....................................    31
Office of the Assistant Secretary for Marketing and Regulatory 
  Programs.......................................................    31
Animal and Plant Health Inspection Service:
    Salaries and Expenses........................................    32
    Buildings and Facilities.....................................    35
Agricultural Marketing Service:
    Marketing Services...........................................    35
    Limitation on Administrative Expenses........................    36
    Funds for Strengthening Markets, Income, and Supply (section 
      32)........................................................    36
    Payments to States and Possessions...........................    37
Grain Inspection, Packers and Stockyards Administration..........    38
    Salaries and Expenses........................................    38
    Limitation on Inspection and Weighing Services Expenses......    38
Office of the Under Secretary for Food Safety....................    39
Food Safety and Inspection Service...............................    39

                        Farm Assistance Programs

Office of the Under Secretary for Farm and Foreign Agricultural 
  Services.......................................................    41
Farm Service Agency:
    Salaries and Expenses........................................    43
    State Mediation Grants.......................................    44
    Dairy Indemnity Program......................................    44
Agricultural Credit Insurance Fund Program Account...............    45
Risk Management Agency...........................................    47

                              Corporations

Federal Crop Insurance Corporation Fund..........................    48
Commodity Credit Corporation Fund:
    Reimbursement for Net Realized Losses........................    51
    Operations and Maintenance for Hazardous Waste Management....    51

                    TITLE II--CONSERVATION PROGRAMS

Office of the Under Secretary for Natural Resources and 
  Environment....................................................    53
Natural Resources Conservation Service:
    Conservation Operations......................................    54
    Watershed Surveys and Planning...............................    56
    Watershed and Flood Prevention Operations....................    56
    Resource Conservation and Development........................    57
    Forestry Incentives Program..................................    58
    Outreach for Socially Disadvantaged Farmers and Ranchers.....    58

      TITLE III--RURAL ECONOMIC AND COMMUNITY DEVELOPMENT PROGRAMS

Office of the Under Secretary for Rural Development..............    59
Rural Housing Service:
    Rural Housing Insurance Fund Program Account.................    60
    Multi-family Housing guarantees..............................    62
    Rental Assistance Program....................................    62
    Mutual and Self-Help Housing Grants..........................    63
    Rural Community Fire Protection Grants.......................    64
    Rural Housing Assistance Program.............................    64
    Salaries and Expenses........................................    66
Rural Business-Cooperative Service:
    Rural Development Loan Fund Program Account..................    66
    Rural Economic Development Loans Program Account.............    67
    Alternative Agricultural Research and Commercialization 
      Revolving Fund.............................................    68
    Rural Cooperative Development Grants.........................    69
    Rural Business-Cooperative Assistance Program................    69
    Salaries and Expenses........................................    71
Rural Utilities Service:
    Rural Electrification and Telecommunications Loans Program 
      Account....................................................    71
    Rural Telephone Bank Program Account.........................    72
    Distance Learning and Medical Link Grants and Loans..........    73
    Rural Utilities Assistance Program...........................    74
    Salaries and Expenses........................................    75

                    TITLE IV--DOMESTIC FOOD PROGRAMS

Office of the Under Secretary for Food, Nutrition and Consumer 
  Services.......................................................    77
Food and Consumer Service:
    Child Nutrition Programs.....................................    79
    Special Supplemental Nutrition Program for Women, Infants, 
      and Children (WIC).........................................    80
    Food Stamp Program...........................................    81
    Commodity Assistance Program.................................    83
    Food Donations Programs for Selected Groups..................    84
    Food Program Administration..................................    84

            TITLE V--FOREIGN ASSISTANCE AND RELATED PROGRAMS

Foreign Agricultural Service and General Sales Manager...........    87
Public Law 480...................................................    88
CCC Export Loans Program Account.................................    89

      TITLE VI--RELATED AGENCIES AND FOOD AND DRUG ADMINISTRATION
                DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration:
    Salaries and Expenses........................................    91
    Buildings and Facilities.....................................    93
    Rental Payments..............................................    94

                       DEPARTMENT OF THE TREASURY

Financial Management Service: Payments to the Farm Credit System.    94

                          INDEPENDENT AGENCIES

Commodity Futures Trading Commission.............................    95
Farm Credit Administration.......................................    95

                     TITLE VII--GENERAL PROVISIONS

Sections 701 through 727.........................................    97
Transfer of Unexpended Balances..................................    97
Changes in the Application of Existing Law.......................    99
Compliance with Rule XIII, Clause 3..............................   103
Appropriations Not Authorized By Law.............................   104
Comparison with Budget Resolution................................   104
Five-Year Projection of Outlays..................................   104
Financial Assistance to State and Local Governments..............   105
Program, Project, and Activity...................................   105

                                
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