[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]
AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND
RELATED AGENCIES APPROPRIATIONS FOR 2016
_______________________________________________________________________
HEARINGS
BEFORE A
SUBCOMMITTEE OF THE
COMMITTEE ON APPROPRIATIONS
HOUSE OF REPRESENTATIVES
ONE HUNDRED FOURTEENTH CONGRESS
FIRST SESSION
________
SUBCOMMITTEE ON AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG
ADMINISTRATION, AND RELATED AGENCIES
ROBERT B. ADERHOLT, Alabama, Chairman
KEVIN YODER, Kansas SAM FARR, California
THOMAS J. ROONEY, Florida ROSA L. DeLAURO, Connecticut
DAVID G. VALADAO, California SANFORD D. BISHOP, Jr., Georgia
ANDY HARRIS, Maryland CHELLIE PINGREE, Maine
DAVID YOUNG, Iowa
STEVEN M. PALAZZO, Mississippi
NOTE: Under Committee Rules, Mr. Rogers, as Chairman of the Full
Committee, and Mrs. Lowey, as Ranking Minority Member of the Full
Committee, are authorized to sit as Members of all Subcommittees.
Tom O'Brien, Pam Miller, Andrew Cooper,
and Elizabeth King,
Staff Assistants
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PART 4
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Office of the Secretary...............
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Natural Resources Conservation Service
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Marketing and Regulatory Programs.....
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Food and Drug Administration..........
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Printed for the use of the Committee on Appropriations
U.S. GOVERNMENT PUBLISHING OFFICE
96-947 WASHINGTON : 2015
COMMITTEE ON APPROPRIATIONS
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HAROLD ROGERS, Kentucky, Chairman
RODNEY P. FRELINGHUYSEN, New Jersey NITA M. LOWEY, New York
ROBERT B. ADERHOLT, Alabama MARCY KAPTUR, Ohio
KAY GRANGER, Texas PETER J. VISCLOSKY, Indiana
MICHAEL K. SIMPSON, Idaho JOSE E. SERRANO, New York
JOHN ABNEY CULBERSON, Texas ROSA L. DeLAURO, Connecticut
ANDER CRENSHAW, Florida DAVID E. PRICE, North Carolina
JOHN R. CARTER, Texas LUCILLE ROYBAL-ALLARD, California
KEN CALVERT, California SAM FARR, California
TOM COLE, Oklahoma CHAKA FATTAH, Pennsylvania
MARIO DIAZ-BALART, Florida SANFORD D. BISHOP, Jr., Georgia
CHARLES W. DENT, Pennsylvania BARBARA LEE, California
TOM GRAVES, Georgia MICHAEL M. HONDA, California
KEVIN YODER, Kansas BETTY McCOLLUM, Minnesota
STEVE WOMACK, Arkansas STEVE ISRAEL, New York
JEFF FORTENBERRY, Nebraska TIM RYAN, Ohio
THOMAS J. ROONEY, Florida C. A. DUTCH RUPPERSBERGER, Maryland
CHARLES J. FLEISCHMANN, Tennessee DEBBIE WASSERMAN SCHULTZ, Florida
JAIME HERRERA BEUTLER, Washington HENRY CUELLAR, Texas
DAVID P. JOYCE, Ohio CHELLIE PINGREE, Maine
DAVID G. VALADAO, California MIKE QUIGLEY, Illinois
ANDY HARRIS, Maryland DEREK KILMER, Washington
MARTHA ROBY, Alabama
MARK E. AMODEI, Nevada
CHRIS STEWART, Utah
E. SCOTT RIGELL, Virginia
DAVID W. JOLLY, Florida
DAVID YOUNG, Iowa
EVAN H. JENKINS, West Virginia
STEVEN M. PALAZZO, Mississippi
William E. Smith, Clerk and Staff Director
(ii)
AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND
RELATED AGENCIES APPROPRIATIONS FOR 2016
________
Wednesday, February 25, 2015.
DEPARTMENT OF AGRICULTURE--OFFICE OF THE SECRETARY
WITNESSES
HON. THOMAS VILSACK, SECRETARY, DEPARTMENT OF AGRICULTURE
DR. ROBERT JOHANSSON, CHIEF ECONOMIST, DEPARTMENT OF AGRICULTURE
MICHAEL YOUNG, BUDGET OFFICER, DEPARTMENT OF AGRICULTURE
Introduction of Witnesses
Mr. Aderholt. Good morning. It is good to welcome everybody
to the subcommittee hearing this morning. I think we have
several subcommittee hearings that are going on at the same
time. So there may be members that will be going back and forth
from different subcommittees.
I know we have the Secretary of Health and Human Services
just next door. That is going on so if you see people leaving,
it is probably not something you said, but rather just because
of schedules.
I want to welcome all of you to today's hearing. Our
primary goal this morning is to examine the Department of
Agriculture's fiscal year 2016 budget, while also reviewing the
funds used past and present.
Our witnesses for this morning is the Secretary of
Agriculture, the Honorable Tom Vilsack. He is joined by Acting
Chief Economist, Robert Johansson, and USDA's Budget Director,
Mr. Mike Young. Welcome to each of you.
Opening Statement--Mr. Aderholt
Before I begin, Mr. Secretary , I do want to commend you
and your team for your timely implementation of the 2014 Farm
Bill programs to date. You had quite a few programs to
implement, and you seem to have stayed on schedule, and again,
I congratulate you on that.
As I have mentioned in previous hearings, we have three
goals in this Subcommittee as we move through the fiscal year
2016 appropriations process. The first goal is improving the
management of the agencies and programs within our purview.
Continue to build upon oversight efforts in previous years. The
goal is enhanced accountability in spending of taxpayer dollars
to improve agency governance, processes and internal controls;
and ensuring transparent decision making.
Specific to USDA, the agency has authorized and has
regulations in place to properly oversee various efforts under
its jurisdiction, from nutrition to farm programs, to
conservation operations.
USDA needs to utilize their oversight capabilities in all
areas to better ensure resources are spent wisely. USDA must
also tighten controls for areas subject to large expenditures
with unclear results and where performance tasks or milestones
are not met, such as information technology investments.
Inspector General Fong testified before this Subcommittee
about two weeks ago. In her testimony, she says that USDA has
challenges with overseeing information technology security and
performance and agrees that the agency needs to strengthen its
internal control.
Moreover, between fiscal year 2009 and fiscal year 2013,
the Inspector General made 55 recommendations for improving the
overall security of USDA systems, but the agreed upon
corrective action has been implemented for only 21 of these
recommendations.
The second goal before us is to target funds to the most
important programs and functions. There is a wide range of
programs in our bill, and I want to be sure that we make wise
decisions in allocating the funding. We should continue to
invest in programs that prove effective and have broad support,
such as WIC, Research and Rural Development Programs.
We should also support programs that have a clear and
distinct reason for funding, for using Federal funding, such as
addressing emerging agricultural pests and disease threats that
are across the Nation.
In addition to funding these programs, we must reduce or
eliminate funding for lower priorities and those programs that
are less effective or may be duplicative.
The third goal is to promote U.S. agricultural free and
fair markets. The safe food and medicines is a good example.
The United States has one of the most highly productive food
agricultural sectors in the world, and the U.S. Government
plays a unique role in ensuring the sector's vitality.
For instance, we support a vibrant rural economy by
investing in infrastructure, such as water and waste and
housing programs. We set the ground rules to ensure efficient
trading of agricultural commodities, and we promote a free and
fair international trade regime that allows U.S. commodities
and products to be sold around the world.
USDA has proposed substantial changes to the programs that
support these efforts, and we will need to carefully evaluate
them to ensure that we continue programs and not undermine
these areas.
Agricultural exports play a crucial role in the U.S.
economy, supporting more than one million jobs and record
levels of exports for our farmers and our ranchers valued at
$152 billion in fiscal year 2014 alone. We need to be mindful
of the intricate trade system if we are to remain a reputable
trading partner, acting quickly to resolve issues on the rail
lines and at ports of entry.
USDA's budget request includes increases for discretionary
and mandatory programs that appear to disregard the debt crisis
facing our Nation. The agency is again proposing to establish
new programs in offices using scarce discretionary resources.
The justification of these actions is lacking robust data
to support the request, hindering this Subcommittee's ability
to adequately evaluate their merit. Data such as a clearly
identified need for these additional programs or offices, the
total estimated cost for the efforts, and the anticipated
results for intended outcomes are not provided.
The issue becomes more complex as these increases are
offset by questionable decrease, such as large reductions
attributed to operating efficiencies.
The savings are justified by a few nebulous sentences that
cite decreased travel, fuel and printing costs that will yield
large savings. However, these savings have been claimed by the
agency in previous years and have been claimed by the agency,
but they are not likely to produce amounts suggested that they
would save in the budget request. These are programs within
USDA's request that remain a priority.
USDA is requesting increased resources to assist with
implementation of the Food Safety Modernization Act. The Food
and Drug Administration is also requesting additional funding
for this purpose. Nevertheless, the subcommittee and the
American public need assurance that the agencies are
coordinating efforts and pursuing effective means for the
implementation.
I want to ensure proper implementation of the Act and hope
that we can discuss this in more detail during our question
period.
In looking at the mandatory programs USDA is proposing to
reinvest savings into new and improved efforts. While these
efforts are well intended, evidence is not provided that
demonstrates current efforts are effective in assisting the
beneficiaries that the resources for new efforts will result in
better services for the customers.
Therefore, I am still a little hesitant to reinvest the
savings into these efforts. I am especially concerned about the
major changes proposed to the Crop Insurance Program. Farmers
have endured an estimated 43 percent decline in net farm income
over the last two years. They are experiencing tough economic
times with sharply lower crop prices and a number of natural
disasters. There are a number of uncertain economic factors in
the future.
Yet USDA is proposing to reduce crop insurance by $16
billion, which is a reduction of over 17 percent, and make it
increasingly difficult for them to secure funding.
I join with my fellow colleague, the chairman of the
authorizing Committee on Agriculture, Mike Conaway, in the
question that we not adversely change the rules of the Farm
Bill, and I certainly do not want to do so through the
appropriations process.
The Ryan-Murray budget deal signed into law back in 2013
caps overall spending as well as defense and non-defense
spending. I anticipate that the subcommittee's funding levels
will remain relatively flat at best. USDA's budget request
largely exceeds the 2015 enacted funding levels.
Today and in the months ahead as we proceed on, we must
analyze the request and focus on allocating the funding using
the goals that I have outlined to the most effective, highest
priority programs that are available.
Ms. Pingree, the Ranking Member is not here. Would you like
to make any opening comments?
Opening Statement--Ms. Pingree
Ms. Pingree. Thank you, Mr. Chair.
I do not have any comments prepared, but I will just
welcome the Secretary. Thank you for the work that you do. I,
too, am looking forward to the hearing and looking forward to
figuring out how the President's budget and what are likely to
be the budget numbers from this Committee come together and
where your priorities will be.
And I will just make a short personal note. At this hearing
last year, which was my first term on this particular
committee, I asked you about the Senior Farmers' Market
Nutrition Program, which in my State is called the Maine
FarmShare Program, and whether that would be funded for the
2014 growing season, and I just want to thank you because that
afternoon you gave us an answer, and that was wonderful work on
your part, and that was an important program for the seniors in
our State in dealing with some of the hunger challenges they
have in making sure they get fresh food. So I will just start
with a little thank you for that and your quick work last year,
and I look forward to everything being solved this afternoon
from today's hearing as well.
So thank you very much.
Mr. Aderholt. Thank you, Ms. Pingree.
Secretary Vilsack, without objection your entire written
testimony will be included in the record, and I will now
recognize you for your statement and then we will proceed with
the questions.
So, again, welcome. Secretary Vilsack.
Opening Statement--Secretary Vilsack
Secretary Vilsack. Thank you very much, Mr. Chairman. I
certainly appreciate the opportunity to be here today.
I would be remiss if I did not acknowledge the absence of
one of the members of this Committee for quite some time,
Congressman Nunnelee. Our thoughts and prayers continue to go
with him and his family and this Committee for his loss.
Mr. Chairman, a budget is an expression of values. It is
also a roadmap for a better future. The budget presented to you
today is a budget that is based on middle class economics in
which we believe we are expanding a family's ability to meet
basic needs, while at the same time creating opportunity
through investment and infrastructure innovation. The
President's budget overall reflects the damage that has been
done in the past by a policy of sequester that has been
damaging both to defense and non-defense investment and
interests.
This budget is also based on a reality in rural America
which is that, indeed, agriculture is critically important to
the future of the rural economy and of America. It has a $775
billion impact on the American economy. One out of every 12
jobs is connected in some way, shape or form to agriculture,
but we have an aging producer population that needs to be
addressed.
It also reflects the reality of persistent poverty,
especially impacting children. Ninety-five percent of the
counties with highest poverty rates in this country are located
in rural America. So let me take a few minutes to reflect on
the importance of American agriculture, the need for expanding
a family's ability to meet basic needs, and the investments in
innovation and infrastructure.
This budget contains enough resources to fund 42,964
operating and ownership loans to farmers, 23,000 of which will
be extended to beginning farmers. It provides access to credit.
It will promote financial literacy and business planning among
new and beginning farmers, and it will provide further
awareness and greater awareness of USDA programs and resources
for our farm families.
It provides for $8.2 billion in crop insurance, which will
help assist us in protecting the value of a $110 billion crop.
It promotes trade as the Chairman rightly indicates, something
that is extraordinarily important to American agriculture,
helping us to knock down barriers that exist to the record
exports that we have experienced over the last five years.
It will provide additional resources in adequate resources
for the Animal and Plant Health Inspection Service (APHIS) to,
indeed, protect the livestock industry, which is a $191 billion
industry, and it will also provide funding for 20 million
additional acres to our record enrolled Conservation Programs.
It will also provide $200 million in watershed protection and
flood prevention.
So it does reflect the importance of American agriculture
to the economy. It also provides assistance and help for
beginning farmers.
On expanding a family's ability to meet basic needs, this
budget provides additional support for the Supplemental
Nutrition Assistance Program (SNAP), focused on our efforts to
improve employment and training efforts to put able bodied
people to work. At the same time, the fact that senior citizens
are not accessing this program as effectively as they should,
we want to pay a little attention to our senior citizens in
terms of access to the SNAP Program.
Six, point, six billion dollars for the Special
Supplemental Nutrition Program for Women, Infants and Children
(WIC) funding will serve 8.5 million women, infants, and
children. I note that 53 percent of all newborns in this
country currently participate in WIC.
Over $26 billion in loans and other assistance which will
provide rental assistance for over a quarter of a million low
income families whose income is roughly somewhere between
$10,000 and $11,000 a year annually. It will also provide
financing for 171,000 single family homes. It will expand
summer feeding, will continue to focus on the 23.5 million
Americans who live more than a mile from a grocery store by
providing money for the Healthy Food Financing effort, and
obviously continued support for our School Nutrition Programs
with a focus on expanding school breakfast and ensuring that
community eligibility is available.
In terms of investment in innovation, we will continue to
focus on job growth. This budget provides assistance for 32,000
jobs. Community infrastructure is supported. Twenty-four
broadband projects, 1,300 waste water sewage projects, roughly
400 electric projects, and over 2,500 community facilities can
be financed through this budget.
On the research side let me just point out that we are
proud of the 758 patent applications that have occurred as a
result of USDA research since 2009, and the 398 new plant
varieties that have been identified by our scientists. This
budget provided additional resources and adequate resources for
the 800 research projects that are ongoing at Agricultural
Research Service (ARS) facilities, as well as adequate
resources for our National Institute of Food and Agriculture
(NIFA), with an emphasis on new opportunities for antimicrobial
resistance and pollinators.
I shared with you, Mr. Chairman, the importance of our two
institutes that we are proposing in nanotechnology and
biomanufacturing and hope that the questions allow us to
amplify on that a bit today.
On poverty, and I will just quickly finish with this, one
in four American children live in poverty in rural areas. In
the Deep South it could be as high as one in three. It is the
highest rate of child poverty since 1986, and that is why we
have included resources in this budget to develop new
approaches and better coordinated efforts within the Federal
Government focused on child poverty.
This budget does contain reforms, and I would simply point
out in conclusion that this budget is still below the fiscal
year 2010 budget that was approved by a previous committee. So
we are in the process of going on six years with no additional
resources, but we have found ways within the existing resources
to save through our administrative services process and our
Blueprint for Stronger Services that has identified $1.4
billion in savings, and I am happy to go into greater detail.
It is far more extensive than travel and the items that you
listed.
So with that, Mr. Chairman, I am happy to try to answer and
respond to questions.
[The statement of Secretary Vilsack follows:]
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DIETARY GUIDELINES FOR AMERICANS
Mr. Aderholt. Okay. Let me begin by just talking about
something recently that has come up with the dietary guidelines
for Americans. I appreciate your recent comments that you have
spent time reviewing the law establishing the dietary
guidelines for Americans, and you have concluded that you and
Secretary Burwell have a narrow mandate in issuing the
following guidelines.
You did acknowledge that the Advisory Committee had a
greater latitude to opine about a variety of issues, but your
function at USDA is to adhere to the statutory directive.
I guess my question that I would pose to you is: do
American farmers and ranchers have assurance from you that the
final report will include nutrient and dietary recommendations
and not include environmental factors and other extraneous
material?
Secretary Vilsack. Mr. Chairman, I fully expect and
anticipate that I will work with my colleague in the Health and
Human Services (HHS) to make sure that we follow the
appropriate approach within the statutory guidelines and
directions that we have received.
I understand we need to color inside the lines and do not
have the luxury of coloring outside the lines.
Mr. Aderholt. I find it interesting that the Advisory
Committee has found that cholesterol is not a nutrient of
concern for over consumption even though previous dietary
guidelines have recommended limiting cholesterol intake to more
than 300 milligrams per day.
There are other such examples in recent past where the
Advisory Committee completely changed its focus despite claims
of sound science. The Advisory Committee also recommended a
diet higher in plant base foods and lower in animal base foods
as more health promoting, even though lean meat has been
included as part of a healthy, balanced diet in previous
dietary guidelines.
How are consumers supposed to feel confident about
following dietary guidelines when the recommendations that are
put forward contradict what was just put out there five years
ago?
Secretary Vilsack. Mr. Chairman, I think it points out the
fact that in many areas science is evolving, and science
changes. The committee that formulated these recommendations is
supposed to take a look at the most recent science and
determine from a review of scientific literature and studies.
You know, part of the issue, I think, here is that we need
to be focused on a broader range of research projects because
if you have a narrow band of research projects that are
conducted over a five-year period, most of what you are going
to find out through this review is what basically has been
written and published in the last five years. It is one of the
reasons why, frankly, in the beef industry I am encouraging the
beef industry to take a look at their check-off program and
expand it because I think there is additional research that is
required, and with additional research it may very well be that
the science will continue to evolve.
It is also the reason why it is important for folks to
understand that they do have a comment opportunity here. These
recommendations are just that. They are not the guidelines, and
it is important for folks who feel differently, and I know that
there are scientists who do feel differently about all of this,
to weigh in with their comments so that we can take into
consideration the breadth of opinions.
Mr. Aderholt. Back last November, Mr. Kingston and I wrote
to you and Secretary Burwell concerning the scientific evidence
used by the two departments to establish sodium
recommendations.
You responded on January 23rd, and thank you for your
response. I would move the original letter and response to be
made part of the record.
[The information follows:]
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Mr. Aderholt. As you know, fiscal year 2015 Omnibus
includes section 752, which states that the sodium levels in
the school milk programs cannot be further reduced until the
latest scientific research establishes the reduction is
beneficial for children.
With regards to the action of the Dietary Guidelines
Advisory Committee, it appears they only reviewed literature
that fit the objective of lowering sodium consumption in
Americans. The point of including the bill language was to make
sure all relevant and recent science was considered so that we
do not harm the health of Americans, including school children,
by forcing a sodium level that the most recent research shows
is harmful.
Would you think is important that USDA and the Health and
Human Services consider this data as well, as they protect the
health of school children?
Secretary Vilsack. Well, certainly, Mr. Chairman, any
information that is relevant and specifically focused on the
welfare of children we ought to consider. I hope that during
the comment period that we would solicit additional information
by virtue of your comments and questions today, and that our
teams would be understanding their statutory responsibility and
the budget law to comply with that.
Mr. Aderholt. And, again, of course, if I understood you
correctly, you are giving your assurance that the final report
will include the nutrient and dietary recommendations that are
included without environmental factors and other extraneous
material?
Secretary Vilsack. Mr. Chairman, I do not want to be cute
about this. I do not want to make a representation to you that
binds Secretary Burwell. What I will commit to you is I
understand my responsibility is color inside the lines, that we
have a responsibility to focus on guidelines that are dietary
and nutritional in impact and effect, and that they will,
indeed, be used to educate the public as well as Federal
nutrition policy.
That is my responsibility, and I intend to live up to that
responsibility. I do not want to speak for Secretary Burwell.
She can certainly do a good enough job by herself on that.
Mr. Aderholt. Thank you.
Mr. Farr.
2016 BUDGET REQUEST
Mr. Farr. Thank you very much, Mr. Chairman.
Sorry I have been in and out. Right next door is the
Milcon/veterans hearing, and I have a lot of military bases in
my district. So I am running back and forth.
Thank you very much for your testimony, and I really admire
your ability to sort of seize the capability you have as
Secretary to look at consolidation and prioritization within
the Department. I think it is long overdue.
You know, these moments of our first hearings are all ones
of nice-and-nice because nobody talks about what happens if we
do not give you the money you are asking for, and I think
hopefully these hearings can talk about that because what will
happen is we will do everything in the public like we are doing
right now, and then the Budget Committee meets, gives us our
numbers, and we do all of the cut, squeeze and trim without
public comment.
I hope, Mr. Chairman, if that happens that you will invite
the Secretary back so he can talk about what might be the
implications of anything we give him less than what he is
asking for. And perhaps you just want to suggest how essential
these monies are.
You know what? I find in Congress that everybody wants to
solve problems, but nobody wants to pay for solving the
problem. There is not anything in our family situation where a
problem does not require some funding or a business where we do
not do it. We throw money at it, and in Congress we have a very
hard time. We might agree that there is a problem there, but we
have a very hard time deciding we want to give you more money
or additional money to solve that problem.
So if there is sequestration, which is rumored in the
Budget Committee that these cuts may go back to 2008 level,
what would be the consequences?
Secretary Vilsack. Well, it is a loss of opportunity. You
know, just take Rural Development programs. For example, it
means fewer projects, fewer job opportunities, fewer job
creating projects, fewer infrastructure needs that are met.
It is one of the reasons why given the fact that we have a
budget that is less than it was in fiscal year 2010, we are
proposing a budget today that is less than it was in fiscal
year 2010, and we are currently in a budget that was less than
fiscal year 2010, that we have sought to figure out ways in
which we can leverage our resources more effectively, and there
is a limitation to that but we are trying every possible way we
can think of to try to meet the need that is out there.
Congressman, we have one in four kids in rural America that
are in poverty. So if you are impacting and affecting jobs, if
you are impacting and affecting the ability to obtain housing,
if you are impacting and affecting the ability to get a decent
education, you are basically making sure that those kids have a
much steeper hill to climb.
And one of the concerns that I have is that all of us
collectively have not spent enough time and attention on rural
poverty, especially as it relates to children, and this budget
begins that process.
RURAL POVERTY
Mr. Farr. How do you prioritize those poverty projects
around the country?
Secretary Vilsack. Well, we had a meeting with the Rural
Council yesterday that I chair in which we are going to try to
create an opportunity to better coordinate the Federal programs
that exist.
You know, we know programs that work, but we have a
tendency to operate them in our silos and in isolation. So we
operate our USDA poverty reduction----
Mr. Farr. You mean silos outside of just USDA.
Secretary Vilsack. Correct.
Mr. Farr. Transportation?
Secretary Vilsack. Our nutrition programs may be operating
differently in a different place than HHS' programs, and HHS'
programs may be operating differently than Transportation's
programs.
We believe that it is important and necessary, and I have
got this map that basically shows the counties and areas of the
country where the poverty rate for kids is higher than 30
percent, and so obviously geographically focuses our attention,
but we also have to make sure that we coordinate and target all
of our resources and coordinate those resources. We have not
done as good a job of that probably ever, not just this
Administration, any Administration, for quite some time.
So yesterday we began a process of trying to figure out how
to do that better.
Mr. Farr. You know, outside of just being Secretary of
Agriculture, I mean, you have been a mayor. You have been a
councilmember. You have been a Governor, Secretary , and a
legislator. I mean, you have seen it all. Many of us have been
through local government as well.
I have never seen a willingness of the Federal Government
to really assess these capabilities and re-prioritize them. I
think it is one of the finest things that the Administration
and you are really doing that, and I really applaud you for
that because everybody in Congress wants to get the best bang
for the buck, and we are not going to get that best bang unless
we use this sort of collaborative effort.
And somebody has to pull it all together. So I hope in
those kind of new starts that we in Congress do not then turn
around and cut you flat because it is a new idea. It is a new
idea that in the long term it is going to be much more cost
effective than essentially our kind of welfare spending that we
all criticize.
So I applaud that, and, Mr. Chairman, if we do cut his
budget significantly, I would really request that we have
another hearing to hear from the Secretary about what the
consequences of those cuts will be.
Mr. Aderholt. Mr. Yoder.
AGRICULTURAL EXPORTS
Mr. Yoder. Thank you, Mr. Chairman.
Mr. Secretary , welcome to the Committee, and I want to
thank you for your time recently that you spent in Kansas and
in my district.
Mr. Chairman, the Secretary came out and met with
agriculture producers and others who create and promote
transportation of goods in our country to discuss the
importance of transportation of those goods and trade.
And I wanted to thank you for your time. I thought it was a
very good use of our time to visit about the opportunity to
sell more goods from Kansas, agricultural products in
particular and other States around the globe.
I thought maybe you could just briefly highlight what
Congress could do or what we should be doing as a country to
promote the export of goods from Kansas and Alabama and
California and Florida and, you know, the other States
certainly that are here and that are in Congress that have a
lot of agriculture basis.
How important is it to them and what can we do? What would
be your position on what Congress could do and how we could
work together, both parties, to create more jobs at home?
And, frankly, the best way to lift some of these young kids
out of poverty is to bring more dollars into the United States
through exporting goods from their communities.
Secretary Vilsack. It is an excellent question,
Congressman. I would say three things. One, recognizing the
fact that 30 percent of all agricultural sales are export
related, which is roughly equivalent to a net cash income for
farming. So theoretically if you were to do away with exports,
you would essentially do away with any real significant profit
margin in farming.
So obviously you need to continue that. So we have to
continue to fund and promote our programs that allow us to go
out and advocate on behalf of and market agricultural exports.
That is why we have asked for an increase in the budget in our
trade promotion efforts, $35 to one return on investment of
those monies.
Two, we need the Congress to give the President the same
authority that every President has had since Franklin Delano
Roosevelt, which is trade promotion authority, so that as we
finalize important negotiations on free trade agreements,
Congress has the ability to review them, but ultimately to vote
up or down.
And then finally, to the extent that we conclude a strong,
fair, and appropriate access, and reducing barrier trans-
Pacific partnership, understanding the significance of that, we
have got to control the rulemaking in Asia and the market
development in Asia.
I'll just finish with this. Today there are 525 million
middle class consumers in Asia. Within 15 years, that is going
to be 3.2 billion. There is a tremendous opportunity here. We
do not want China writing those rules. We want to write those
rules.
FARM BILL SAVINGS--SNAP
Mr. Yoder. I appreciate your leadership on those issues,
and it is important to Kansas. I know it is important to a lot
of farmers in our districts who depend on selling their goods
around the globe, and so it is an important economic
development tool I think we could work together on, and we look
forward tomoving on some of those items that you suggested.
I noted last year during the Farm Bill debate that there
were some expected reductions in savings that the two parties
worked together to sort of iron out in a compromise bill. One
of those areas of savings was related to agriculture, farming,
and the other area was related to the Food Stamp Program, SNAP
Program. We know that about 80 percent of the Farm Bill is for
food stamps, yet the area in savings on the Food Stamp Bill was
only eight billion out of 23 billion in total savings. So it is
a disproportionately small savings.
But it was, I think, an ability for the sides to show they
can sort of iron out some differences, but to get to that
solution, the compromise was savings through the Low Income
Energy Assistance Program (LIHEAP). I guess I would like an
update on your implementation of those savings and where we
think that is going to end up.
I think the estimate was about eight and a half billion in
savings, and I note that an article in Politico stated at the
time the single biggest savings comes from cracking down on
what many see as an abusive scheme employed by about 16 States
that distribute token amounts of low income free assistance to
households to help them gain higher benefits.
Have we corrected that abusive scheme? And what will the
savings be?
Secretary Vilsack. Congressman, I think we will have
savings in the program. It may not come from exactly the area
that Congress has directed. Seventeen States were impacted by
what you all did in the Farm Bill. Twelve States have
essentially increased their commitment in LIHEAP, which they
are capable of doing and able to do. But we are seeing
declining numbers in SNAP, and I have always said that the most
effective way of reducing SNAP is an improved economy and
focusing time and attention and resources on getting able
bodied people to work who are currently receiving SNAP.
We are currently doing that, and I think we will see from
the pilots and from an improved economy significant reductions
in the same way under the farm programs the expectation was
that we were going to receive savings from our safety net
programs. The reality is we are probably going to have to
trigger those a little bit quicker than anticipated.
So, you know, at the end of the day, I think you are going
to have the cumulative savings, but you may have it in a
slightly different mix and a slightly different calculation.
WIC PROGRAM ELIGIBILITY
Mr. Yoder. I also note, Mr. Secretary , your statement
which I think many people would be surprised to hear that 53
percent of newborns in our country start out on the WIC
program. I think that is clearly an example of the economy not
working well enough for enough people that we have these young
mothers and families reliant upon this program.
But it's also by some reports an example of a poorly
administered program. I am sure you are familiar with the
General Accountability Office (GAO) report in 2013 that stated
that the Food and Nutrition Service (FNS) regularly monitored
State and local WIC administration through the management
evaluations conducted by its regional offices, and in one-third
of the States reviewed since 2010, FNS found problems with
income eligibility determination, policy and procedures.
Furthermore, the GAO found that FNS has not reviewed
findings on income eligibility determination and as a result,
they have not focused their technical assistance in this area.
So that report was pretty damning in that it stated some of
the explosion in WIC eligibility is related to an improper
implementation of the program.
Mr. Aderholt. Let me just interject here.
Mr. Yoder. And I apologize, Mr. Chairman.
Mr. Aderholt. You did run a little bit over, but if you
could give some of your answer quickly so we can move on to the
next.
Mr. Yoder. How would you fix this and what is your response
to that?
Secretary Vilsack. Additional training, and additional
focus on this. I would say this is actually an answer to
Congressman Farr's question on the impact of inadequate
resources. We have seen a reduction in workforce, and if you
have got fewer people, it is very difficult to do all of the
work that you all want us to do, and we see this not just in
WIC, but we also see this in some of the other programs.
So we are doing our level best to try to improve training
and make sure the States understand their responsibilities.
We are also focusing on fraud and improper use of the
program, which I know is also an interest and a priority of
this Committee.
Mr. Yoder. Thank you, Mr. Chairman.
Mr. Aderholt. Ms. Pingree.
FOOD SAFETY OUTREACH PROGRAM
Ms. Pingree. Thank you, Mr. Chair.
Mr. Secretary , thank you for your testimony and your
answer to the previous questions.
I want to talk about an issue that is of concern to the
farmers in our State and I think in places like mine around the
country. As you know, the Food and Drug Administration (FDA) is
getting close to finalizing new food safety regulations later
this year, and I am very interested to see if we can have a
discussion on the USDA's plans for the Food Safety Training
Competitive Grants Program, which will be operated by the USDA
under the NIFA agency.
Now, in Maine I have heard from farmers for the last couple
of years who are very concerned that the Food Safety
Modernization Act (FSMA) rules are going to be applied in a way
that unfairly targets small and medium sized farms, when we
know the intent of the law was to prevent food safety outbreaks
like those from massive farms and farm operations like Foster
Farms where salmonella affected eggs and people in 18 States.
Like a lot of New England and other States, small farmers
in my State who sell locally and direct to the consumer are by
definition better protected from a food safety outbreak. They
have a limited market, can more easily trace their sales, and
as you can imagine, farmers in our State have turned out to
public hearings on this, so we have had a lot of discussions
with the FDA on what the final rules will look like.
We do not know the funding levels yet, but if it is
adequately funded, the Food Safety Outreach Program could play
a crucial role in preparing the farmers for FSMA by conducting
outreach to help train them for the complex web of the new
rules and easing some of the burdens of compliance for these
farmers.
I think without the training, FSMA will fall short of its
goal of improving on-farm safety. I am very pleased that we
were able to provide the Food Safety Outreach Program, for the
first time, with funding in fiscal year 2015, and I am very
supportive of the USDA's request to double those funds in
fiscal year 2016.
I would like to hear you talk about the $5 million that has
been requested, how it would be spent, and if you have enough
funding for what really needs to be done.
This will be a massive change for farms of that size.
Secretary Vilsack. Well, we obviously will do this in
conjunction with the Department of Health and Human Services.
First and foremost, it is going to be important for producers
to know who is in and who is out of the program because there
are exemptions for the program, particularly aimed at small
size producers.
You know, using technology through Webinars and using the
Extension Service, the expectation would be that we would try
to reach as many farmers who were interested in this and in
need of assistance. We are really focused on trying to build a
local and regional food system in rural America as a complement
to production agriculture, and so this becomes critically
important because oftentimes those small producers are
specialty crop producers and the people who will fall within
FSMA's reach.
So I would say we will extensively use Extension,
extensively use Webinars, and utilize our land-grant university
system to try to get the word out.
Ms. Pingree. Just a little bit of a follow-up, and I agree
with you, and I appreciate in your testimony that in both the
organic market and in the local foods market you recognize that
this is a fast growing market, and there is a lot of interest
in it and great opportunities for many of our rural farmers to
grow or establish new opportunities, and I am lucky enough to
come from one of the States where the average age of our farmer
is not going up and we have more farms coming into production
and returning to some of the ways farming used to look like in
the 1800s. So we are happy about that, maybe except for the
excessive snowfall this winter, but other than that, we are
happy for some of that return.
My understanding is that the USDA is partnering with the
FDA on this initial round of grants to establish a National
Coordination Center and several regional centers for food
safety training. I just have some concerns about the plan,
namely, that grant funding may be limited to large regional
centers rather than to organizations that work directly with
small and mid-sized farmers and food businesses.
I think some of them are best suited to provide the
outreach in education and training. Can you talk a little bit
more about the vision for the Competitive Grants Program and
beyond, particularly how you will make sure that this funding
has real impacts?
Secretary Vilsack. Well, a component of any competitive
grant will be the ability to establish your capacity to reach
the people in the field and out in the countryside, and to the
extent that I can say one thing with certainty about this USDA
is that we are all about collaboration. We are all trying to
figure out how we leverage scarce resources and use all of the
support entities that we can.
So I would expect and hope that NIFA would continue to do
what it has done on many other initiatives similar to this,
which is as a component of the grant basically say: how are you
going to ensure us that the word is actually going to get
beyond the university campus? How is it going to get actually
to that farmer or that producer who may be concerned about
whether they are exempt or not, how they comply, what they have
to do, what paperwork they have to fill out and so forth?
So I can assure you that that will be part of the
competitive process and part of the decision making process.
Ms. Pingree. Well, I look forward to working with you on
that. Thank you for your answer.
Thank you, Mr. Chairman.
Mr. Aderholt. Mr. Valadao.
UNDER SECRETARY FOR TRADE AND FOREIGN AGRICULTURAL AFFAIRS
Mr. Valadao. Thank you, Mr. Secretary.
First I wanted to say that your department, especially Dana
Coale and others there, are helping out quite a bit working
with our California dairy producers on this process to go with
the Federal marketing order. So it has been going well, and she
has been very well received in the district and very
informative.
The recently enacted Farm Bill included a mandate that USDA
create a new Under Secretary for Trade and Foreign Agricultural
Affairs. As part of the fiscal year 2015 Agricultural
Appropriation Act, this Subcommittee also commissioned an
independent study similar to the one USDA was supposed to
complete by July of last year. The new Under Secretary would
become USDA's tip of the spear for agriculture trade, export
and import efforts. This is in addition to the higher level
efforts led by the U.S. Trade Representative.
Currently trade and foreign affairs functions are spread
across the Department. Streamlining trade priorities through
the new Under Secretary , I believe, will result in much more
efficient and effective process.
In your testimony you even highlighted the exponential
growth in agriculture exports as one of the few bright spots in
our economy. A large portion of these are coming from my
district, and we want and need to see this to continue.
We have seen two recent examples of the manufacture crisis
that cost our farmers, ranchers and producers dearly: the West
Coast port shutdown and the backlog of Midwest railway
shipments.
Mr. Secretary , how can a newly organized function provide
direction to the Department and U.S. agriculture in general by
strategically focusing on trade related issues and avoid these
types of situations in the future?
Will you make the creation of this new function a priority
in complying with the mandate?
Secretary Vilsack. Congressman, I would be happy to have
our Acting Chief Economist talk to you about the contracting
process that we are currently undergoing to comply with the
budget directive to have this studied, if that would be
helpful.
But I would say, first and foremost, that this is a
complicated issue because it does require a review of all the
mission areas that are impacted within USDA by trade, and
certainly we have taken a role both in the port resolution and
in the rail issue. The port deal, as you know, was resolved in
large part because of Secretary Perez's intervention, and he
will tell you that the most powerful message that he carried
out to the West Coast was from farmers because he was given
that information from us.
On the rail side, it is good to note that we continue to
see investment by our rail companies, and we are now beginning
to see a much more competitive secondary market for cars. So
that has abated a bit, and hopefully with additional
investments from the rail industry that we have advocated for
and pushed for that will be less of a concern in the future.
But would you like the Chief Economist to sort of----
Dr. Johansson. Thank you, Congressman, for the question.
As you know, my office, the Office of the Chief Economist,
was given extra funding to pursue this study, and we are moving
ahead as quickly as possible with getting the contract vehicle
fleshed out and put in place. Of course, as the Secretary
mentioned, it is a very complicated issue, and we expect to be
working with the group that is going to be working on that
report over the next couple of months, next six months or so to
get that report.
And we will have several places during that process by
which we can come up here and brief folks about the progress we
have made and to solicit any input that you might have on that,
but we will be working forward on this and hopefully we will
get that contract in place within the next few weeks.
DIETARY GUIDELINES ADVISORY COMMITTEE
Mr. Valadao. Perfect. And then back to the Secretary.
Since 1985, HHS and USDA have appointed Dietary Guidelines
Advisory Committee consisting of nationally recognized experts
in the field of nutrition and health. The charge of the
Committee is to review the scientific and medical knowledge
current at the time and to provide recommendations for the next
edition of Dietary Guidelines based on their current review of
the literature.
To date the committee has consisted entirely of human
nutrition and health experts. However, during the review
process, agriculture questions often arise, especially
regarding common practices and processing methods associated
with food production.
In order to appropriately address the needs of the
committee, do you feel that it is beneficial to have an
agriculture expert included in this Committee?
Secretary Vilsack. Congressman, I am not sure that it is
absolutely essential or necessary that it be involved in the
committee, but obviously it is very important that those
considerations be taken into consideration when the guidelines
are established.
I mean, at the end of the day what we have here is a 600
page report that ultimately will be substantially whittled down
to probably less than 100 pages by our teams at HHS and USDA.
So I think it is important for that viewpoint to be in the
process, but I do not necessarily think it has to be. It might
be helpful, but it does not have to be included in the
recommendations.
Mr. Valadao. All right. Thank you.
Mr. Aderholt. Mr. Rooney.
DIETARY GUIDELINES ADVISORY COMMITTEE
Mr. Rooney. Thank you, Mr. Chairman.
Mr. Secretary , it is good to see you again.
As you know, my district is largely citrus based, and I
have a comment with regard to that, but then I have a question
with regard to another big part of my district, which is beef
cattle.
I was happy to finally see that the Specialty Crop Research
Initiative (SCRI) funds were released to the projects chosen by
the Citrus Subcommittee. This has been an incredibly
challenging time in Florida's history, and while the industry
is resilient, the delay in getting these projects out the door
is concerning to the growers in my district.
I know that a majority of the Multi-Agency Coordination
(MAC) funding is going to shorter term projects, and the SCRI
funds tend to be more focused on the longer term solutions, but
the overwhelming anxiety over any solution to the problem makes
me concerned about the level of funding requested in your
budget for the programs directed to solve the problem.
I am hopeful that in the future this Citrus Subcommittee
will improve their communications not only among their members,
but also the stakeholders on the ground. That is something that
I have been hearing in my district time and time again.
I do not know if you have a comment on that, but I just
wanted to make sure that you knew where our growers stood.
Now, with regard to this issue of lean meat, I am concerned
with the recent Dietary Guideline Advisory Committee's report
that removes lean meat from the definition of a healthy dietary
pattern, but does mention healthy benefits associated with lean
meat in a footnote and a handful of other times in the 571-page
report.
The final recommendation from the advisory committee I find
confusing since they spend significant portions of their
meetings talking about healthy diets like the Mediterranean
style diet, which is higher in red meats than the U.S. diet.
So on one hand the Committee is touting diets with more red
meat, but on the other, removes lean meats from what they
consider a healthy diet. Now, I assume that you believe that
red meats and processed meats have a role in a healthy and
nutritious diet, but what I want to ask you specifically deals
with genetically modified organisms (GMOs).
The 2015 report states that access to sufficient nutritious
and safe food is an essential element of food security for the
U.S. population. A sustainable diet helps to ensure this access
for both the current population and future generations.
However, the report fails to mention the strong scientific
consensus behind the safety of GMOs or their apparent net
positive impact on both food sustainability like increased
yields per acre and the environment, like the reduced use of
pesticides overall.
So given that the recommendation to decrease meat
consumption was included based on moderate scientific evidence
and there is arguably strong scientific evidence demonstrating
the environmental benefits of GMOs in a sustainable
agricultural production, how will this be addressed in the
final 2015 dietary guidelines?
Secretary Vilsack. Well, may I comment on the citrus issue
first? I want to point out that $40 million has been invested
to date in citrus greening, and it has been focused on trying
to find a wide variety of better surveillance, better
detection, better treatment, and better prevention initiatives.
We were directed to set up a process that involved asking
our advisory council to essentially operate this and to
essentially make recommendations about where the priorities
ought to be, and they came up with 20 priorities, which
obviously is 20. That is a lot.
They have since looked at this and narrowed it down to
four. So I fully expect in the future that decisions will be
much quicker because that process has been completed, and I
would also expect and anticipate that we wouldn't necessarily
only focus on short-term review, but we would also be looking
at long-term solutions as well.
So you can be reassured we are focused on this and we are
investing in it.
Okay. As it relates to GMOs, you know, there is no question
in my mind that GMOs are safe. There is no question in my mind
that we have a conversation that needs to take place in this
country about the science behind GMOs, and there is no question
in my mind that we have to figure out ways in which organic
producers and our genetically modified producers can coexist in
the agricultural world that we live in. In my view we need both
for potentially different reasons.
And I would say that a good deal of attention is being
placed on recommendations. Again, I want to emphasize my
understanding of my role here, which is nutrition and dietary
only. That's my function, and I intend to be very vigilant in
looking at the statutory direction to me in terms of the
development of these guidelines, and I am going to be
personally involved in this.
I have on my desk a very large book that advocates a
slightly different approach to all of this, and so my hope is
that through the comment period we will expand the knowledge
and the reach and the information, and that all of that can be
taken into consideration so that we can provide the United
States citizens and health care policy makers clear direction
in terms of nutrition and dietary guidelines, and that is what
I intend to do.
Thank you.
Mr. Aderholt. Mr. Young.
WATERS OF THE U.S. RULE
Mr. Young. Mr. Secretary , fellow Iowan, good to see you
today. Thanks for being here.
Thank you, Mr. Chairman, for this hearing.
I want to ask you about the Environmental Protection Agency
(EPA's) Waters of the U.S. rule. I know it is not under the
USDA, but I hear a lot from farmers, and I know that many folks
here in the room do as well. I see this as a massive land grab
that will hurt Iowa agriculture by regulating farmland instead
of the navigable waters as Congress intended.
Unfortunately, Iowa farmers think this rule will hamper,
disincentivize, and possibly prohibit voluntary conservation
practices that are actually working.
What has the USDA done in response to the Waters of the
U.S. rule and will you, Mr. Secretary , stand with the farmers
and publicly oppose this rule?
Secretary Vilsack. Congressman, we were engaged in a
process with sister agencies in providing education and
information in terms of real life responses or reactions to
anything that is being proposed or considered. We will do that,
have done that, will continue to do that.
I think the most effective way for me to be effective on
behalf of American agriculture is to continue to make sure
sister agencies as they are making decisions that may impact
agriculture in rural America, that they are aware of the real
life implications.
Secondly, I have encouraged the Administrator of EPA to
open up dialogue and conversation with producers so that she
can hear directly from producers what you are hearing when you
travel back to our home State, and she has traveled to rural
America. She has gone to farms. She has visited with farm
groups, and we have set up a regular communication system and
process with community groups, livestock groups so that the EPA
Administrator can hear directly from them.
Third, we are very heavily invested in supporting and
advocating for voluntary conservation. We believe it works, and
we believe we have assessed the impact of voluntary
conservation. It is now at record levels, over 400 million
acres, over 600,000 producers. We know from our assessment
programs that nutrients are being reduced, that erosion is
being reduced. We believe it works, and we believe the reaction
to the Farm Bill Regional Conservation Partnership Program,
which was more than we expected in terms of interest, sort of
supports the notion that voluntary conservation has an
important role to play.
And finally, we have stressed to our sister agencies the
importance of predictability, stability and the ability of
certainty, the opportunity for folks to know precisely what the
rules are so that they can comply with them, so that there is
no question or confusion about that. We have done that with the
Endangered Species Act. We have also done it in the context of
EPA regulations.
FEDERAL CROP INSURANCE PROGRAM
Mr. Young. I appreciate those comments, and you know,
farmers really are terrified of this rule. I believe it hurts
Iowa agriculture. I ask you to continue to be that voice to the
sister agencies on behalf of the Iowa farmer and ask that you
oppose this rule during the interagency process.
I want to talk a little bit about the Federal crop
insurance program. Farmers anticipated this new Farm Bill would
provide some certainty, and now they are concerned less than a
year after its passage. The Administration is cutting programs
that farmers rely on. I believe it is a cut of $16 billion over
ten years.
As you know, those crop insurance premium supports are the
most vital and important risk management tool for Iowa farmers
and farmers across the country.
Can you explain the Administration's proposal to cut the
crop insurance premium supports?
Secretary Vilsack. Sure. The GAO and Inspector General have
been concerned about the preventive planning aspects of crop
insurance suggesting that it has a disincentive for the
planting of a second crop, and part of what we have proposed
and suggested is to remove that disincentive so that farmers
are encouraged to plant a second crop.
Secondly, there is the issue of the harvest price loss
option. In some cases the reimbursement in subsidy rate is
anywhere from 60 to 80 percent taxpayer supported. We believe
this is a partnership between taxpayers, producers and
insurance companies and a partnership in our view is a little
bit closer to 50-50 than 80-20, and we think that our
responsibility with crop insurance is to ensure that we are
insuring against Mother Nature. The harvest price loss insures
not just against Mother Nature, but also against market
decisions that producers are making. It is one of the reasons
why we have an Agriculture Risk Coverage (ARC) and Price Loss
Coverage (PLC) program.
So the combination of those things suggest to us the need
for proposed modifications and changes, and particularly since
it looks as if the harvest price loss option might result in
nearly 50 percent of the cost of the crop insurance program. I
would say $8.2 billion being invested in this program is an
indication that we understand the importance of it and the
significance of it, but there are some issues that have to be
dealt with.
Mr. Young. I appreciate that, and I also appreciate your
comments on the reliance of sound science when it comes to
GMOs. I appreciate that.
I yield back my time, Mr. Chairman.
Mr. Aderholt. Dr. Harris.
FARM SERVICE AGENCY (FSA)--STAFFING
Dr. Harris. Thank you very much, and thank you, Mr.
Secretary , for appearing before us.
You know, I represent Maryland's First Congressional
District, a rural area, 12 counties most of which are rural.
Farmers in my district have been contacting my office about
concerns about their local FSA office specifically as it
relates to their operating hours and staffing.
You know, the language agreed upon in the fiscal year 2015
omnibus included a moratorium on closing FSA offices until a
comprehensive assessment of its workload is conducted. Given
this language could you provide an update on the status of the
workload assessment?
Secretary Vilsack. We are in the process of doing that. We
actually were in the process of doing that before the budget
bill was proposed. The budget bill approves us to spend an
additional $400,000 to do what we have already done, which we
will do.
The reality is, as I told the Chairman yesterday,
Congressman, we have 31 offices around the United States that
have no employees in them, and one of the reasons we were
asking for permission to right-size these offices is to focus
on 31 offices that have no physical person in them. No business
would operate that way.
We have some issues with our office structure. I know that
there is an issue in your district involving a held over lease
situation, which we are going to rectify and take care of, but
it is a small indication of a larger problem that we are
currently dealing with.
Dr. Harris. Is there a hiring freeze in place right now
that would prevent FSA from hiring additional staff?
Secretary Vilsack. It is a budget issue.
Dr. Harris. But internally is there a hiring freeze?
Secretary Vilsack. No.
Dr. Harris. I mean, has the decision been made not to hire
additional----
Secretary Vilsack. No. In fact, we have added additional
staff as a result of the passage of the Farm Bill.
Dr. Harris. Okay, and I will ask you----
Secretary Vilsack. But, Congressman, we are actually
significantly below where we were when I first started this
job. It is roughly 15 percent, I think, or so of workforce
reduction.
APHIS--AGRICULTURAL QUARANTINE INSPECTION FEES
Dr. Harris. Okay. And I will ask you to provide for the
record an update on the staffing situation in my district,
including both permanent and temporary employees, as well as
any available vacancies.
[The information from USDA follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
One other issue that has come to my attention is that the
APHIS has proposed a new rule that would revise the
Agricultural Quarantine Inspection fees on aircraft, ships,
trucks and railroad cars to, quote, more accurately rely on the
fees for the costs of the services.
But when you look through the proposed fees, the
international passenger flights pay between $225 and $1,600,
but if you are an all-cargo flight no matter how big an
airplane, it is a flat $225 fee. So obviously airline
passengers will be paying more than if it were just cargo, and
private flights pay nothing at all.
How do you justify this kind of inequitable treatment of
private airline passengers? I mean, they are going to pay a
disproportionate amount which could be as much as $150 million
a year.
Secretary Vilsack. Actually, Congressman, if you look at
the overall proposal, it is designed to address part of that
inequity. We did, in fact, see that passenger air travel was
disproportionately bearing the cost. We had a consulting group
come in and basically take a look at the entire fee structure,
which has not been changed in over a decade. We have obviously
seen significant import increases and challenges with imports.
So we asked them to take a look at that. How would you
basically provide the balance? We created this proposal. We
have also been working with the industries that are impacted
and affected and have made certain modifications. But I think
if you look at the overall program, it is designed to better
balance between passenger service and commercial service.
Dr. Harris. So when all is said and done will there be a
disproportionate fee paid? I mean, will, in fact, the passenger
airlines be paying more than their share even under the new
program's proposed fees?
Secretary Vilsack. I am hesitant to say it is totally
equitable, you know, but I would say that it will be better
than it was.
BIOTECHNOLOGY REGULATORY SERVICES
Dr. Harris. Okay. Well, thank you very much for that.
I am going to just echo my concerns, my colleague from Iowa
here, with the proposed Waters of the U.S. rule. I would hope,
first of all, that your department was consulted extensively
prior to proposing the rule because of the disproportionate
impact on agriculture. This is the number one issue in my
district. People are just afraid that the irrigation ditches
are going to be declared navigable waters of some kind.
And I would hope that through the interagency process,
again, as my colleague from Iowa has suggested, that you
aggressively protect American farmers from this intrusion by
the EPA and Corps of Engineers on their water.
Finally, in fiscal year 2015, the agency was appropriated
an additional $740,000 to help ensure the agency will continue
to make strides toward improving regulatory predictability. And
with regards to that, at what point in the future does the
agency anticipate it will start meeting those goals of the
regulatory predictability with regard especially to
biotechnology regulation?
Secretary Vilsack. Actually we have done a good job of
reducing the backlog that I inherited when I was Secretary. We
had 23 pending applications when I became Secretary. We are now
down to three.
We have had since that time ten additional applications,
and I believe we have taken action on seven. So we have
actually improved, and we have actually reduced the amount of
time it takes for regulatory approvals from roughly 900 days to
somewhere around 18 months, and our goal is to get to 13 to 15
months, which will be very consistent with international
approvals.
Dr. Harris. Well, thank you very much, Mr. Secretary.
I yield back.
FSA--STAFFING
Mr. Aderholt. Before I recognize Mr. Rogers, I want to
clarify. You mentioned about the FSA offices. The issue last
year when you were dealing with this, how did that come about?
Was it a budget freeze or hiring freeze rather, or was it
because of trying to free up money regarding MIDAS?
Secretary Vilsack. No, no, no. Congressman, the reason we
focused on the proposal was first to address the fact that we
have offices today, and we have had these offices for some time
that have had no full-time physical person in them.
Secondly was, based on where we knew the work was--now you
are asking us to review this again, which we will be happy to
do--based on where we knew the work was, retrofit it, right-
sizing the staffing levels of offices so that they can
effectively address the needs and demands, and that was the
purpose and reason.
Mr. Aderholt. Yes, but I think last year there was some
money that was used to free up, not this year but last year, to
free up because of the MIDAS issue, as I recall.
Secretary Vilsack. Well, there is no question that, given
the reductions in the Salaries and Expenses (S&E) accounts that
have occurred over a period of time, there were resources that
were used to ensure that we had and continue to have better
technology for our producers.
But their driving purpose of the consolidation was to make
sure that we had adequate numbers of people in offices to be
able to do the workload that we knew individual offices had,
and in some places where there was very little, we were
overstaffed.
Mr. Aderholt. I understand. I think the MIDAS thing was a
factor last year.
Secretary Vilsack. It may very well be, but from my
perspective the key here is to continue looking at ways in
which we can become more efficient, and that is part of it.
Mr. Aderholt. Mr. Rogers.
ECONOMIC AND COMMUNITY DEVELOPMENT
Mr. Rogers. Thank you, Mr. Chairman.
Mr. Secretary , good to see you. Welcome to you and your
aides.
I apologize for my tardiness here, but we have another
hearing going in another room next door, and I missed the
opening statements, but I want to briefly welcome you and thank
you for visiting my district back in January of 2014.
As you know, in Eastern Kentucky we are working on a
regional community development initiative known as SOAR,
Shaping Our Appalachian Region. Your attendance at one of those
early SOAR meetings meant a lot to the region and the
communities involved.That program, by the way, is moving along
wonderfully. We are starting to see some early success stories
in the region, and I want to thank you for designating that
area as a Strike Force region of the country, which means a
lot.
To continue on that path, I want to learn more about
section 6025 of the Farm Bill, which allows USDA Rural
Development the ability to prioritize projects that are part of
multi-jurisdictional strategic economic development or
community development plans, multi-county organizations, such
as SOAR.So at your convenience, would you give us an update on
USDA's progress in implementing that provision of the Farm
Bill?
Secretary Vilsack. Mr. Chairman, we have over 50 regions of
the country that we have invested resources in to enable those
multi-county and in some cases multi-State areas to take a look
at how they might create a compelling economic vision for the
region, and then to be able to identify resources that can be
directed to make that vision a reality.
Earlier today I showed this map, Mr. Chairman, which you
are probably very familiar with. This is a map, and I apologize
for the smallness of it, that reflects the counties in this
country where the child poverty rate is in excess of 30
percent. And it tells us and shows us, and the SOAR Program in
particular created a greater awareness of our having a more
comprehensive approach; that it was not enough just to simply
make one investment over here and one investment over here;
that there needed to be coordination within USDA.
That is why we have Strike Force. I can tell you Strike
Force has resulted in over 100,000 investments being made in
Strike Force areas pursuant to an overall strategic plan. I can
tell you that we have invested over $11 million in those Strike
Force areas, and I think we are seeing some signs of progress.
We are now working with our Federal sister agencies to try
to figure out a way in which we can better coordinate each
other's programs. I visited earlier about the Rural Councils
Initiative in this respect. So we are very much engaged in
this. We understand it is the best way to use resources.
The last thing I would say is we are also indicating and
educating people in the private sector about investment
opportunities that exist.
The problem we have is that we have an enormous number of
water projects that we could fund. We will have resources to
fund 1,300, but we might have 2,300 applications. We cannot get
the investment community interested in a single water project
even if it is a $5 million project, but if we could figure out
a way to bundle 50 of those projects, we could actually create
an investment asset class that the private sector would be
willing to invest in.
So we are now in the process of having folks come in, take
a look at our portfolio, figuring out how we can adequately
bundle sufficient numbers of projects, and we are now beginning
to identify capital markets that might be willing to invest in
those bundled assets. That is why CoBank announced the $10
billion initiative. It is why Citibank yesterday just announced
a $100 billion effort, part of which is going to go in rural
areas.
So it is a combination of strategic visioning, coordinating
our resources, coordinating sister agency resources, and
engaging the private sector.
Mr. Rogers. Well, good luck. That is very, very important.
Secretary Vilsack. Well, you are making it. The leadership
that you and Governor Beshear have provided in Kentucky are, I
think, a terrific example of how this ought to be done in other
parts of the country.
Mr. Rogers. Thank you.
Secretary Vilsack. Of course, it helps to have the Chairman
of the Appropriations Committee engaged in the process, I might
add, and a Governor who is pretty dog gone progressive.
WATERS OF THE U.S. RULE
Mr. Rogers. Thank you, and it is great to have the
Secretary of Agriculture as a part of that team.
Having said that, let me ask you about the Waters of the
U.S. Rule. We had our Farm Bureau from Kentucky here yesterday,
several hundred of them, and that was a big topic of
conversation with farmers. They are worried; they are
frightened at this notion that the Federal Government would
assert jurisdiction over farm ponds, irrigation canals,
culverts on farms, drainage ditches, and the like and require
them to come to Washington and get a permit to put a culvert on
their farm or to restock a pond or what have you.
Can you give us any alleviation of those concerns?
Secretary Vilsack. Well, Mr. Chairman, I have indicated to
Administrator McCarthy concerns that I expected would be
expressed, as you have expressed them, particularly as it
relates to ephemeral streams, the notion of a bed, the bank,
and water in there at some point in time creating potential
opportunities. And we have expressed that to EPA.
I respect my sister agency and the determination and
responsibility they have, both statutory and from a judicial
direction, and we have done our best to make sure that they are
educated about the impacts of this. We have encouraged the farm
community to comment, as they have.
Our focus is to create the most strong and robust voluntary
conservation possible so that we are in a position to provide
assistance and help to farmers regardless of what ultimately is
determined or decided by EPA, and ultimately decided by the
courts, so that they are in the best position to comply.
And I am proud of the fact that we have a record number of
acres enrolled in conservation, and I am very, very pleased
with the reaction to our regional conservation program, which
has shown great interest and collaboration.
DEPARTMENTAL OFFICE STAFF LEVELS
Mr. Rogers. And finally, Mr. Secretary , let me ask you
briefly about some increases you have requested. You are asking
for $908.5 million above the 2015 level, and included in that
is a huge increase in staff.
According to data, USDA has increased staff to support
Department activities at the Federal headquarters from 3900 in
2009 to 4900 for 2016, a 25 percent increase. During that same
time period, many agencies at USDA have seen a reduction in
staff to support critical activities.
What do you think? Are you asking too much?
Secretary Vilsack. Mr. Chairman, first of all let me say,
as a practical matter, the budget that was submitted by the
President is attempting to convey a very strong message about,
in our view, respectfully, the inappropriate policy of
sequester and the impact it has not just on non-defense
spending but also on defense spending. So it is reflective of
that.
It is also reflective of the fact that we have had
reductions in workforce. I am happy to check on those numbers.
I do not believe that those are accurate, but I could be wrong.
I know that we have had overall reductions in workforce. In
many areas some of the questions that have been asked today are
why we are not doing more of this or that, and part of the
reason is that there are a limited number of people working.
But we are at record levels of participation, and this
budget that we are proposing, despite the increases, is still
below the budget that I had in fiscal year 2010, which was the
first full budget the President submitted. And we have been
able to identify almost $1.4 billion of additional savings
through our administrative services process. But I am happy to
check those numbers, and if you are right about those numbers,
I will be asking serious questions because I do not believe
that is accurate.
Mr. Rogers. Well, in your budget request, you will have
increased staff to support Department activities by 25 percent
in just six years, including your 2016 request. Those numbers
are, I think, pretty accurate.
Secretary Vilsack. Well, I know that we have had an 18
percent reduction prior to this year, an 18 percent reduction
in FSA employees. And I know that we are very conscious of
making sure that we do not disproportionately impact outside of
the D.C. area.
And in fact, we are in the process now of consolidating our
offices to be able to save rent space on folks who are located
in the Capital District that are not physically in our
building, the Whitten Building, or the South Building.
Mr. Rogers. Would you for the record furnish----
Secretary Vilsack. Sure. Sure.
Mr. Rogers [continuing]. On staff numbers, and increases or
decreases and what have you, so that we have got a picture of
where you are?
Secretary Vilsack. That is a fair request. Absolutely.
[The information follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Rogers. Because the request that you have for
additional staff in headquarters is rather shocking.
Thank you, Mr. Chairman.
Mr. Aderholt. Thank you.
Along with the chairman, we are also happy to have the
ranking member with us, Mrs. Lowey. So you are recognized.
SNAP--ELDERLY PARTICIPATION
Mrs. Lowey. Thank you very much, Mr. Chairman.
And Secretary Vilsack, welcome. I want to thank you for
coming before the Agriculture Subcommittee today. And as I am
sure others did, I apologize for not coming on time, but we
have four Secretaries appearing before the Committee. So I want
to thank Chairman Aderholt and Ranking Member Farr for having
this hearing to discuss the fiscal year 2016 budget request.
There are many areas, but what I want to do is limit my
questions to two. One is SNAP for the elderly. I was really
shocked by this report. According to the National Council on
Aging, over 4 million low income seniors rely on SNAP to put
food on the table. The amount of seniors facing food insecurity
has more than doubled--this is the United States of America--
since 2001. And yet three out of five seniors who qualify for
SNAP benefits do not apply.
Your budget requests $9 million to work with States to
improve access to SNAP for low income seniors, and I thank you.
How do you plan to target eligible seniors, to prevent senior
hunger? What obstacles does the Department face in getting the
message out about SNAP for the elderly?
Secretary Vilsack. Congresswoman, thank you very much for
the question. If I can just take five seconds of your time.
Mr. Chairman, part of those numbers are the National
Finance Center, which is located in New Orleans. And perhaps
the increase of that number is a result of the fact that we are
taking on more responsibility for processing applications and
paperwork and payroll for a variety of other sister agencies,
which actually saves money over time. But we will get you more
detailed information about that.
I appreciate the question about SNAP and the elderly. I too
am concerned about the fact that only 42 percent of eligible
folks are receiving the benefits. And what we have found out
from our initial study is that the process is cumbersome. The
process requires annual recertification, which is difficult and
problematic for seniors, who may not have adequate
transportation.
And so what we are looking at is a way in which we might be
able to streamline the application process, make it a little
bit easier for folks to understand the application process, and
take a look at perhaps not having the need for annual
recertification, given the fact that these seniors are most
likely not going to be employed or their financial
circumstances are not going to change significantly. They are
probably living on a very, very small Social Security check.
And also getting over the hurdle that many have, where they
see this as something that they do not have the right to
receive, and that is a generational issue that we are going to
have to address and deal with.
Mrs. Lowey. This has been going on for a long time. And I
understand attitudes take time to change, but in terms of the
process, how big a hurdle is that?
Secretary Vilsack. Well, I think it is a significant
hurdle. But I think perhaps what has happened is that we have
paid a lot of attention to children. We have paid a lot of
attention to families. But we have forgotten about this
component, which is equally important, which are seniors.
And now, because of these numbers, we are going to put a
little more attention and focus on it. My hope is that that
will make a difference in the numbers. And I will tell you that
when we have put a focus on certain States and certain groups
of people, we have seen increases. We are now at 83 percent of
eligibles participating, which I suspect is probably close to a
record if not a record level of participation.
CHILD NUTRITION
Mrs. Lowey. Thank you. Now, you said we have paid attention
to children. I guess so. But when I was looking at those
statistics, according to the Centers for Disease Control and
Prevention (CDC), more than one in five children between the
ages of 12 and 19 are obese. This has long-term consequences to
the health of our Nation as well as our economy.
We know that children and adolescents who are obese early
in life are more likely to suffer significant health problems,
type 2 diabetes, strokes, and cancer, among others. The USDA
has been tasked with improving school lunches, child nutrition,
and increasing standards under WIC.
I have worked on this issue a long, long time. In fact, I
can remember--oh, gosh, I was working at the State before I got
to Congress--and we were hiring the unemployed, helping them
work in school lunch programs, having them use commodities,
teaching them how to prepare healthy foods.
Can you tell me about any new programs you have, or what
does the Department do to improve childhood nutrition in the
coming year? Or you can talk about an old program if that maybe
has not been working as successfully and we would like to make
it more successful.
Secretary Vilsack. Well, this is an issue that has evolved
over time. It is an issue that is not necessarily going to be
resolved in a short period of time. It is going to take time.
We have reformulated the WIC package. We have instituted many
of the Healthy, Hunger-Free Kids proposals. We are helping
school districts; 93 percent of school districts have adopted
those guidelines and proposals.
We are helping those who were having difficulty with a
variety of programs--Smarter Lunchroom grants; school equipment
grants; additional recipes from a recipe contest that makes it
easier for people to do nutritious meals; expanding the school
breakfast program--that is a focus of this year's efforts;
also, expanding the summer feeding program, and using
innovative and creative ways to get more kids covered. And we
have seen 23 million additional meals served since 2010, when
we began this effort.
And so we are focused on a holistic effort. Within SNAP, we
are engaged in educating SNAP recipients on healthy choices,
and we are providing opportunities through the Food Insecurity
Nutrition Initiative to provide point-of-sale incentives for
more fruits and vegetables and healthier foods.
We are also expanding the opportunity for locally and
regionally produced foods, and particularly fruits and
vegetables, through a series of pilots that were authorized in
the Farm Bill. So there is an awful lot of activity in this
area, but I think it is going to be over a long period of time
that it will take for attitudes to change, for the food
processing industry to make adjustments--which they are
making--reducing sugar, reducing sodium, reducing the fat
content of certain items.
And I will tell you, the 70 percent of elementary school
kids surveyed in a recent survey I saw are embracing these
changes. Even 63 percent of high school kids are embracing
these changes. I know when I was governor, if I had a 70
percent approval rating or 63 percent approval rating, I was
doing okay. Probably folks here would be okay with those; maybe
your numbers are higher. I do not know.
But it is going to take time, and it is going to take
effort. And it also has to take understanding. This chart--I
have shown it three times now--this explains to me a lot of the
challenges that are faced because some of these areas and some
of these school districts that are doing it are poor. They are
poor. And they are pinching pennies, and they are finding it
difficult. And we are trying to provide help.
We created a program called Team Up for Success, where we
are taking schools that are having a hard time adjusting to
these new standards and pairing them up with similarly situated
schools who have embraced them so they have a mentor. And we
are providing assistance from the University of Mississippi and
their nutrition center, and from Cornell and its nutrition
work, for strategies to make it a little bit easier for these
school districts. But you have to have some understanding of
the challenges that some school districts face with poverty.
Mrs. Lowey. I just want to say, in conclusion, I really
appreciate the work you are doing. Some of us, especially my
colleague Congresswoman Pingree, have been working on these
issues for a very long time, and I would love you to keep us
posted.
It seems to me we have been talking about these issues a
long time, and there are some successes. And maybe we have to
publicize them more and help those who are having the success
visit school districts who are having problem. But even in poor
school districts, and I think of one in particular, using
government commodities you can be creative; and using some of
the fresh food around, maybe they can be even be more creative.
But I appreciate the work you are doing, and I look forward
to getting regular updates, as I know Ms. Pingree and other
members of the committee would appreciate as well. So I thank
you. Thank you, Mr. Chairman.
Mr. Aderholt. Mr. Bishop.
ARC AND PLC PROGRAM COVERAGE
Mr. Bishop. Thank you very much. Welcome, Mr. Secretary ,
and I apologize for my delinquency. I had three Subcommittees
scheduled at the same time, one of which I am ranking member
on. I really wanted to get here, though, because I did have
some questions. But first I have two thank yous for you.
I was very pleased to see that the President's budget for
fiscal year 2016 included a significant investment of almost
$114 million for a new Research Service Agricultural poultry
laboratory. As you may or may not know, I am co-chair of the
Congressional Chicken Caucus, and Georgia, of course, is the
number one producer and exporter of poultry in the country. At
another time--I am not going to ask you now--I would like for
you to give us an update on the progress of that.
The second thank you has to do with the broadband wireless
technology project. You recall that you visited in 2010 in
rural Southwest Georgia. We experienced significant delays and
a number of problems and challenges. But I just learned last
week that Rural Utilities Service (RUS) 2 has signed off on the
final contracts. There has been a readjustment there.
The City of Albany has assumed responsibility for that
project, and it looks like it will enable thousands of rural
residents in our Southwest Georgia area to get high-speed
internet for the first time. So I just want to thank you for
that, and thank the RUS staff for continuously working with us
on that.
I want to get to a more substantive generic question with
regard to cotton. The 2014 Farm Bill transitions existing
cotton base to generic base. And allowing the traditional
cotton base to be protected as generic base has given farmers
in my State a tremendous amount of flexibility in planning
while still providing an adequate safety net.
If a producer has generic base, the quantity of payment
acres determined may not include any crops that are
subsequently planted during the same crop year on the same land
for which the first crop is eligible for price loss coverage or
agriculture risk coverage payments.
For example, the provision would penalize a farmer who
plants a cover commodity such as oats or wheat for grazing and
then follows behind on the same land with corn that was planted
and harvested. That producer has to take the base on the first
crop despite the fact that crops used for grazing are often or
not ever harvested.
Is there anything that USDA can do to exempt cover
commodities that are used for grazing and not taken to harvest
from the generic base allocation?
Secretary Vilsack. Congressman, the Farm Bill does provide
for some flexibility relative to cover crops with the ARC and
PLC program, but it is very, very specific. If it is used for
haying and grazing, wheats, oats, other crops that are used for
haying and grazing, that is okay. The law does not allow us to
use it if it is for cover only.
So there is sort of a glitch potentially or a modification
that may be required in terms of our statutory authority. We
will work with the flexibilities we are given, but we cannot
work outside of the flexibilities you all have given us.
BIOBASED MARKETS PROGRAM-FOREST PRODUCTS
Mr. Bishop. Thank you for that. It is a problem, and
hopefully we can work together to try to alleviate that glitch.
Let me also thank you for your leadership in promoting wood
products in building construction through both your symposium
last March, ``Building With Wood and Jobs in the Environment,''
and the launch of your Tall Wood Building competition. Of
course, for Georgia, wood products are incredibly important and
where processing and manufacturing of forest products employs
almost 150,000 people in the State and supports 504,000 family
woodland owners who supply most of the industry with raw
material.
The recent Farm Bill made some changes to the Biobased
Markets program which will provide opportunities to strengthen
markets for forest products, which is again a key economic
driver. With the strong markets for forest products, we have
got healthier forests and stronger rural economies.
Can you provide an update now that USDA has begun to
implement the changes to the Biobased Markets program to
include forest products, and how is that program working for
forest products, and what are the next plans for
implementation?
Secretary Vilsack. Well, we are getting the word out about
it, and I think it is going to take a little while in terms of
BioPreferred programs for the word to get out. But we are in
the process of advertising that.
We are excited about the response on the Biomass Crop
Assistance Program (BCAP) to the utilization of woody biomass.
I think it is something in the neighborhood of 300,000 tons of
woody biomass was created and supported through the recent BCAP
announcement.
And we are also really excited about this tall building
competition. I think it is going to be amazing to see 20-, 30-
story buildings made solely from wood in some of our major
cities. We were very pleased with the reaction, and in fact,
the Softwood Lumber Council was so impressed with the
applications we received that they added another million
dollars to the contest. So it is now basically a $3 million
pot, which is going to enable us, I think, to fund more than
one project, which I think is really going to get people's
attention.
COUNTRY OF ORIGIN LABELING (COOL) PROGRAM
Mr. Bishop. Okay. Finally, and before my time runs out, the
COOL program, a couple of years ago the World Trade
Organization (WTO) issued a decision favoring Mexico and Canada
with respect to the Country of Origin Labeling, and
specifically the treatment of Canadian and Mexican cattle
imports to the USA resulting from our COOL law and procedures.
Under the law, cattle either processed in Canada or Mexico
or imported to the U.S. from Mexico or Canada must be labeled,
and of course the WTO found that it prejudiced U.S. consumers
against Mexican and Canadian beef. Can you give us a status of
USDA's activities in that regard?
Secretary Vilsack. Congressman, the process is under appeal
with WTO. We are expecting a decision some time this spring.
There are two options here. We either win the appeal or
Congress has to change the law because we cannot navigate a
requirement that we label with U.S. product without segregating
U.S. product. And once we segregate, WTO comes into play.
So either there has to be a generic label established by
Congress or you have to essentially repeal what is in the
current law if we lose the WTO appeal. Those are the two
options.
Mr. Bishop. Thank you very much. My time is expired, but
thank you very much.
Mr. Aderholt. Ms. Lowey. I am sorry, Ms. DeLauro.
SINGLE FOOD SAFETY AGENCY
Ms. DeLauro. Thank you very much, Mr. Chairman.
Good morning, Mr. Secretary. Sorry to be late in coming,
but a lot of secretaries today on Capitol Hill testifying.
Hello to you, but also if I might just say hello to Melinda
Cep. USDA has got a number of former DeLauro employees on their
staff, so I am pleased to see that they are there. And it is
good to see you, Melinda.
I want to say thank you to you, Mr. Secretary, for your
work in preserving and strengthening child nutrition, WIC,
SNAP, commodity supplemental feeding programs. They are
important programs. They lift people out of poverty. They
assure our next generation is ready for the future.
To that end, while I was not here, I do understand that
there were comments made about the SNAP program and the WIC
program. I really believe it is unconscionable that folks would
want to further cut SNAP benefits when we know the program has
been successful in helping families. Low wage recovery,
sluggish job growth, this was a lifeline.
Actually, the House Agriculture Committee views an
estimates letter shows bipartisan agreement that SNAP costs are
coming down. The SNAP error rate is very low. It declined from
2.77 in 2012 to 2.6 in fiscal year 2013.
With regard to WIC, it is highly effective. It reduces the
probability of high-risk births, especially in very premature
and low birth weight babies. And for every dollar we spend on a
pregnant woman in WIC, it is up to $4.21 is saved in Medicaid
for her and her baby. So I think we should take a hard look at
the value of these programs before we comment about their
inefficiencies, maybe link to some other programs that are
inefficient.
I am going to try to tick off two or three quick questions
because I have to go back.
A proposed consolidation of the Food Safety and Inspection
Service (FSIS) and food safety activities, you and I have had
this conversation many times. You know I am a supporter of an
independent agency. I know you have expressed support for this
proposal. I agree it is a good first step.
Can you talk about your thinking on the issue and why you
think an independent food safety agency within HHS is the way
to go? You also know that I have felt that FSIS and the food
safety functions of FDA were back burner issues and that this
kind of an approach for a single effort would be more
beneficial for food safety.
Secretary Vilsack. Fifteen different agencies have some
jurisdiction or some responsibility for food safety, and it
creates 15 opportunities for the right hand not to know what
the left hand knows and not to be able to react and respond
accurately and quickly. And this proposal is a way of
underscoring the fact that the President ought to have the
ability to reorganize and restructure the Executive Branch of
government for greater efficiency.
To me, it is about food safety. It is about making sure
that everyone knows what they need to know when they need to
know it so that we can prevent food safety issues or be able to
respond to them as quickly as possible so that we can prevent
more foodborne illness.
We still have work to do. If you put this in the context of
the number of meals that are served every day in this country
and the number of items in each meal, we are talking about over
a trillion opportunities for foodborne illness. So when we look
at the numbers in that context, I think we can say that we have
a relatively safe food supply.
But when 45 million people have a foodborne illness, when
130,000 of them are hospitalized and several thousand
unfortunately and tragically die, there is still obviously work
to do. And one way to do it is to create a more efficient
system, and that suggests a single food safety agency. And I
really take issue with the notion that by doing that, that
somehow you are going to put all of this on the back burner.
I can tell you the people that work in my shop and the
people that are in my office, we take this issue very
seriously, which is why we have proposed a number of changes in
terms of E. coli, a number of changes in terms of Salmonella
and Campylobacter, that I think do suggest that we take this
seriously, and it is not a back burner issue and it should not
be. It should never be. And a single food safety agency is not
going to make it a back burner issue, regardless of what other
jurisdictional issues----
BEEF LABELING RULES
Ms. DeLauro. I do not expect it will be a back burner
issue. We have often seen the opportunity because you have dual
missions in both you and the FDA with regard to promotion of
product. And FDA has so much on its plate--excuse the pun--that
it has been difficult to really address the food safety issues.
I am of the view that this is a good first step in moving
forward, and my hope is that you all will be sending
legislation here so that we can look at it.
Let me move to mechanically tenderized beef. I have been
for nearly a decade been urging the Department to finalize the
mechanically tenderized beef labeling rule. A comment period
closed on December 24th.
My questions are, why did it take USDA until November 21,
2014--December 24, 2013 is when it closed--2014 to transmit the
final rule to the Office of Management and Budget? What is the
holdup with getting the rule finalized? Will the USDA take
action to suspend the provisions of the uniform labeling
regulation in order to implement the rule in 2016 and 2018?
Let me just at the same time talk about the beef grinding
rule. I will not go through the background on that; I do know
my colleague, Ms. Pingree, is interested in this. But what is
the status of this proposed rule? Do you intend to move forward
with the rule soon? Will there be further delays? And will you
move forward with the rule even if there is industry
opposition?
Secretary Vilsack. I am not quite sure where to start yet.
I will try to answer all those questions. I hope I do not
forget them.
Ms. DeLauro. Well, no. Will USDA take action to suspend----
Secretary Vilsack. Yes.
Ms. DeLauro. What took us so long and what held up the role
on mechanically tenderized beef? Will we suspend provisions of
uniform labeling in order to move in 2016 versus 2018?
Secretary Vilsack. We obviously have to take the comments
that are provided seriously, and we have to review them, and we
take our time to make sure that we comply with the
administrative process.
Having said that, I think you have a legitimate concern
about the fact that because we were delayed, that under the
Uniform Labeling Act, that this will not become effective in
2018. You find that unacceptable, and frankly, I do, too. So we
are going to suspend that and we are going to move the timeline
up.
Ms. DeLauro. Thank you. Thank you very much.
Secretary Vilsack. On the----
Ms. DeLauro. Grinding.
Secretary Vilsack [continuing]. Grinding laws, we are
proceeding with that, and I can assure you that we understand
the importance of getting that done. We have had a recent issue
in Massachusetts that suggests the need for this, and we are
going to proceed forward with it.
TRADE AGREEMENT NEGOTIATIONS
Ms. DeLauro. Thank you. Thank you very much. I am going to
get an extra two minutes, and then I will depart.
TPP trade questions, Mr. Secretary. There was a report from
the Administration saying that completing the Trans-Pacific
Partnership (TPP) provides the opportunity to open markets,
lower tariffs, and help support an additional 650,000 jobs.
Washington Post Fact Checker found this claim to be patently
false. In the Post analysis, it was discovered that the net
effect of the TPP on jobs was zero.
In October 2014, a report issued by USDA calculated that if
the TPP in fact slashed all tariffs and the tariff rate is to
zero, it would not alter U.S. gross domestic product at all. In
the first two years of the Korea free trade agreement, U.S.
exports to Korea declined, growing trade deficits with the
country that resulted in nearly 60,000 lost jobs.
Given the findings as reported by the USDA and the threat
that the 11-nation TPP poses to jobs and wages for the average
American worker, how does the Administration justify the
pursuit of fast track authority for this trade deal?
If I can, I would like to ask a couple of other questions,
and if you do not get to them, we can get back for the record.
The Transpacific Trade and Investment Partnership (TTIP)
negotiations, the European Union would like for FSIS to grant
equivalency status to the entire E.U. as a whole for its
inspection systems for meat, poultry, and engaging products
rather than conducting equivalency determinations for each
individual country in the E.U. What is the USDA position on
this approach?
And for APHIS, reports of the current trade negotiations
indicate that there might be a new sanitary or phytosanitary
dispute mechanism to speed up resolution of possible
disagreements. Is it true? If so, how will this mechanism
impact both APHIS and FSIS rulemaking processes for imported
processes? How will that impact imported inspection systems
that are currently in place?
Secretary Vilsack. The sanitary-phytosanitary (SPS)
decision-making process ought not to alter the inspection
process that is required for imports to ensure producers and
consumers of the safety of whatever is being imported.
On TTIP and recently with beef, we have indicated a strong
desire that each individual country meet its responsibilities.
That is the way we are approaching this today, and I do not
know of any reason why that would change because we have to be
assuring our consumers of the equivalency in terms of safety.
In terms of TPP, I will tell you that obviously we are
going to have a disagreement on whether or not this is going to
create opportunity for agriculture and whether or not that
opportunity in expanded exports will create jobs. It is
certainly true that free trade agreements have increased
agricultural exports by 130 percent, and our determination is
for every billion dollars of agriculture trade, roughly 6500
jobs are supported. And so if you are going to expand trade
opportunities to a middle class that is expanding
exponentially, you are going to create jobs. You are going to
create additional market opportunities for farmers.
The last thing I would say is one of the most important
reasons for TPP is to make sure that China does not write the
rules. And I can assure you that Ambassador Froman is working
extremely hard to make sure that the labor and environment
standards that are in this TPP are historic in nature and
cement significant gains in terms of labor and environment. And
I frankly do not want China to be writing those rules. I would
prefer the United States write those.
Ms. DeLauro. Well, Mr. Secretary , with respect to China,
et cetera, the way that we can really deal with China is to
deal with currency, and currency is not going to be part of the
TPP.
Secretary Vilsack. That is a whole 'nother issue.
Ms. DeLauro. It is a whole other issue. But that
geopolitical issue is not one that has really to do with middle
class families and their ability to have a job, to maintain a
job, and to maintain good wages. Thank you very much.
SCHOOL MEALS REGULATIONS
Mr. Aderholt. Sure. Thank you. And I think we have gotten
through everyone once. What we will do is we will do another
round, and we will conclude with this round. Instead of staying
hard and fast to the five-minute rule, we will be a little bit
lenient on that so we can go ahead and conclude.
I know, from our meeting yesterday, you said this is your
second day of testifying on the Hill, so I know that you have
had a rigorous couple of days. I know there are other meetings
after the noon hour. So we will try to do this one round. But
again, if you want to go a little bit over five minutes, we
will accommodate that just so we can go ahead and make sure
that we can get everybody in the next round.
We have talked a little bit about school meals, and I think
every Member of Congress--and I cannot imagine any Member of
Congress that would not want a healthy, balanced meal for our
schoolchildren. I mean, I think that is a given. There is
nobody that I know that is advocating of trying to give
unhealthy meals or anything that would be harmful to students
in any way.
My efforts on the school meal issue that I have worked on
really stem back from what I have heard back in my district.
Some people have indicated that it is some kind of industry or
something comments. I have not really even talked to industry
about it. It stems back, actually, from conversations that I
have had with the nutritionists at the schools.
One in particular, Ms. Evelyn Hicks, she works in one of
the schools in my home county of Winston County, serves
students every day, and she is the one that told me about the
struggles that she was facing with the new regulations. I am
pleased that we were able to gain some flexibility on the whole
grain requirements and the sodium standards in the fiscal year
2015 omnibus. I appreciate the Department promptly issuing the
guidance memos to States so that they can begin implementing
the whole grain flexibilities.
I realize that child nutrition programs are up for
reauthorization this year in the authorizing Committee. But as
the process moves forward, I would hope we could work together
to find solutions to the specific challenges facing our
schools, such as flexibility with Smart Snack regulations, a
longer-term solution to whole grain and sodium requirements,
and any other areas where we can bring practical and strategic
fixes to the program.
And I would just like to ask you if you would commit to
working with us to provide school flexibility on these
particular areas that will help provide and serve healthy meals
without continued financial strain.
Secretary Vilsack. Mr. Chairman, I think the USDA has been
always willing to provide flexibility where it is warranted and
needed, and we will certainly work with everybody and anybody.
What we are concerned about, and I take reassurance from your
comments, that we do not get into a situation where flexibility
is a vehicle through which we take a significant step backward
from the forward steps we have taken on child nutrition.
So we are happy to work with folks, and I think we have
reflected that. And our willingness to work with our Team Up
for Success program, our willing to do the Smarter Lunchroom
grant program, our school equipment grant proposals, are all
designed to provide and equip school districts with the tools
that they need to comply. We want this to work.
SINGLE FOOD SAFETY AGENCY
Mr. Aderholt. Thank you. Let me switch issues here, the
single food safety agency. The President's budget proposes
transitioning to a single food safety agency by combining the
Food Safety and Inspection Service and the food activities
within the Food and Drug Administration to one agency under the
Department of Health and Human Services. Support for the
President's single food safety agency among consumer advocacy
groups, and certainly the regulated industry, appear to be slim
to nonexistent.
Could you explain to the Committee how rearranging boxes on
the organizational chart would produce a favorable public
health outcome? And why do you think that the Health and Human
Services can provide better leadership over food safety issues
than the USDA?
Secretary Vilsack. Well, Mr. Chairman, the President's
budget uses this as an example for making the case for the
ability of the Executive Branch to have the capacity to
reorganize. And I think the President, as the chief executive
officer of the Executive Branch, ought to have that authority.
Let me say that we have had circumstances in the time that
I have been secretary where there has been information that HHS
and FDA may have had that would have impacted and affected some
decision-making that we would make relative to school meals,
for example, or circumstances where we had information where
HHS might have been better off understanding immediately.
There is this risk in any system that has multiple parts
and multiple jurisdictional operations of the right hand not
knowing what the left hand knows and not knowing it as quickly
as they need to know it. So a single food safety agency,
regardless of where it is located, would essentially eliminate
that risk.
And I think it is a significant risk and one that we are
always conscious of in an effort to try to communicate with our
sister agencies. But there are a number of agencies that are
involved in this, and reorganizing would, I think, provide less
risky circumstances.
The location of it, I think it is just simply we do 20
percent of food inspection. They do 80 percent. It is just,
where is the bulk of the work currently being done? And with
respect to consumer groups and the industry, I think they are
assuming that if this were to happen, that somehow all of this
would get lost in a large organization, and nobody would care
about it, and it would not be adequately funded.
I just do not think that is the case. That is certainly not
how I would approach it, and I cannot imagine that Secretary
Burwell or future secretaries of this department or her
department would think that food safety was a back burner
issue. It just is not.
Mr. Aderholt. Is there any scientific evidence that
consolidation would reduce the number of foodborne illnesses
and provide a safer system?
Secretary Vilsack. Well, I would be happy to research that
question, and it is a legitimate question. But I will tell you
from my own experience recently in having spoken to the mother
and father of a young fellow who died as a result of consuming
tainted meat, that when you look at the timeline, when you look
at the relationship between the State health department and FDA
and USDA, I do not know if the time would have made a
difference.
But there were gaps in when people knew information. And it
led me believe that if those gaps did not exist, then that
would be one less question we would have to ask about our
system. But because they did exist, it is a question I asked:
What can we do to make sure that those gaps do not exist in the
current system? And the one way for sure that those gaps would
not exist would be if you had just one agency.
And you would also have better accountability because you
would be able to point the finger at the agency that is
responsible for food safety and say, why did you not do your
job? Today it is very difficult. If you look at individual
cases, it is very difficult to determine exactly where the
fault might lie if there is a problem and a delay.
DIETARY GUIDELINES FOR AMERICANS
Mr. Aderholt. Well, let me just say there is a lot of
skepticism about this. And over the years, we have seen these
type of proposals that would make some giant food safety
agency, and there has been outbreaks and increases of foodborne
illnesses that we have seen. So I just want to add that there
is some skepticism, and unless we can see some scientific
proof, there is going to be continued reluctance.
As my time concludes and I go on to Mr. Farr, let me just
follow up with--we were talking earlier about the Dietary
Guidelines. And a couple other members have mentioned that in
addition to my question. And understanding the tremendous
amount of information and the literature from constituencies
that have to be reviewed as you move forward in your taking
public comment, would there be any harm in extending the
comment period for an additional 60 days so that all the
relevant data can be received?
Secretary Vilsack. Given your request, Mr. Chairman, I
would be happy to visit with Secretary Burwell. As you know,
the Department of Health and Human Services is the lead agency
in the formulation of these guidelines. We were the lead agency
five years ago. And in deference to her and her department, I
would want to make sure that I had a chance to visit with her.
But I would be happy to do that if that would be all right with
you.
Mr. Aderholt. Thank you. That would be great. Thank you.
Mr. Farr.
ORGANIC AQUACULTURE RULE
Mr. Farr. Thank you very much for asking those questions. I
hope that as you requested of the secretary to extend the
comment period, I hope that our Committee will also extend the
comment period for the impact of the Budget Committee's
decision on what our expenditure level is in this Committee so
that if it is less than what the Administration is asking for,
we can have an extended comment period on how we feel about
those impacts and really get the facts on what the consequences
are going to be.
I also wonder--Mr. Secretary , I think you are in a
position in an agency--and I think you are the longest-serving
Secretary now. You certainly have an incredible, distinguished
background as a national leader, even being a candidate for
President of the United States. I would hope that you realize
that you can do a lot of message-making in this country that is
beyond perhaps other agencies, and a couple of them that I
would like to address on.
One is this school meals, and I think that the chairman has
got a legitimate concern. He is hearing from his constituencies
that they do not like the way this program is being
implemented. The kids are rejecting the food. Is there a way
you can be a matchmaker and find school districts that are like
the school districts that are rejecting it who have been
successful?
There are a lot of school districts out there. We have got
1200 in California. I represent a K-12 school that only has 33
students, a public school district in a really rural area. So
it is all types. And I am sure that there are schools that are
saying this is too hard, too difficult. The kids do not like
it.
The same size school somewhere else is saying, this is a
great challenge and we have done some marvelous teaching
opportunities with it. And if perhaps you could be the
matchmaker to match up these successful and unsuccessful
schools so that there will not be such a fight here in Congress
to delay or opt out of the program.
Second comment: I think that the biggest street battle,
other than your issues on trade, are the discussions of GMOs, a
totally confusing subject matter that the media and internet
has taken it over. I think if we do not speak out quickly on
the science side of it, we are going to lose the debate.
California is going to go to a statewide initiative; I
think it will pass. In the food area you are going to begin
seeing what has happened in this chaos with--I hate to use the
analogy, but it is the medical marijuana, where you have 33
States that have 33 different opinions that are totally
opposite of what the Federal law is.
And there is just really mass confusion out there, and what
you do in the end is lose respect for government. People who
want to disobey the law have all kinds of reasons. And I think
the Federal Government is hurting in its respect, and that is
why voter turnout is so low.
So a couple of these issues I think we have to get in front
of. I think you are trying to do with that with the trade
issue. But I do not think we have done a very good job between
USDA and Food and Drug Administration to really get to the
bottom of the GMO issue. And I hope that you will find a way
that we could ratchet up that, get a discussion on the facts.
And lastly I want to ask you, and this is one I want an
answer to, why are you delaying or why is the Department
delaying the rulemaking on organic aquaculture? It seems that
suggestions for that rule have been in the books for a long
time. In fact, some of my people have invested heavily in
organic aquaculture, and they are waiting for that rule in
order to stimulate the business.
Secretary Vilsack. Congressman, your question was longer
than my presidential campaign, so I appreciate your mentioning
that. [Laughter.]
The issue with aquaculture is just simply a matter of
prioritization. You have limited people, lots of work to do,
and the question is, how can you do the most amount of work
that is going to implement the most amount of people
effectively? This is an issue that we do take seriously, but
there were competing rules. And you are bringing it up, so I
will----
Mr. Farr. A lot of work that gets to rulemaking by very
wise people who have gone in, volunteering their time for years
to make the suggestions.
GENETICALLY MODIFIED ORGANISMS
Secretary Vilsack. That is true of many of the rules that
we are engaged in, and that is the issue. But I take your
concern.
With the Chairman's permission and your permission,
Congressman Farr, I have got to respond to the concerns that
you expressed about stepping up the advocacy on some of these
issues. On the GMO issue, we in USDA sponsored an AC-21 group,
which brought organic and GMO and conventional producers
together in a room and said, look, help us identify the steps
that we need to take to make sure that everyone can basically
get along here.
And they essentially focused on the need for seed
integrity. They focused on the need for better stewardship,
focused on the need for risk management tools, focused on the
need for a communication process. And I will tell you that we
have made progress on every single one of those
recommendations.
Now, we are now scheduling a second followup conference
that is going to take place in a couple of weeks at North
Carolina State where we are going to bring folks back and we
are going to have an additional conversation, say, well, now we
have done all of this; what is the next thing we need to do?
So we have been heavily engaged in this issue. And I have
been addressing this issue of labeling in a way that I think
makes sense, and would hope that Congress, at the end of the
day, understands this. You have got these referendums. You are
right, you cannot have 50 different sets of rules. That is
crazy. It is not going to work. The courts are not going to
allow it. And you cannot necessarily label something that
suggests that there is something unsafe about the product when
that is not the case.
What you can do is you can use this bar code, and you can
extend the bar code, so that people who are genuinely
interested and wanting to know what is in this particular
product can, with a smartphone or a scanner at a grocery store,
get all the information they want about a product in a way that
conveys, you have the right to know but you do not have the
right to know in a way that conveys a misperception about the
product.
If you had an extended bar code and we were engaged in it
or FDA engaged in it, somebody is engaged in basically creating
the template for what information would be in that extended bar
code, industry could solve that issue in a heartbeat. You would
not need 50 different regulations. You would not need
referendums. Consumers would have the right to know. They could
make a choice.
If they are informed, or if they do not care, as many
consumers are more concerned about price or quality or
whatever, then you are not creating a misperception about the
product. That seems to me to be a way of furthering the process
and addressing this issue.
And then finally, on the issue of schools, we are in fact
doing exactly what you are suggesting. We created this Team Up
process. We had a pilot where we brought I think it is about a
half a dozen schools to Mississippi, the University of
Mississippi. They were down there for a day and a half. We
brought a companion number of school districts that were
successfully implementing these efforts and said, what can you
learn from each other? And then we had a day and a half of
training and additional information.
We are following up, and we are proposing in this budget to
extend this program in other parts of the country because
legitimately, there are some school districts that struggle.
And I do not have any doubt about that. And I have no doubt
that the Chairman is right. These people are good folks and
they care deeply about their kids and they want to do right by
their kids. They just need help. And we are trying to provide
help in a variety of different ways. And we will continue to do
as much as we can to elevate this.
The last thing I will say is the challenge with this
department is its portfolio is so broad that it is very hard--I
mean, I do an hour of press a day on a variety of issues, and
so I can get you the clippings and show you how much we have
talked about this if you are interested. But trust me, we are
working on these issues.
Mr. Farr. I am done.
Mr. Aderholt. Okay. Mr. Young.
FARM BILL PROGRAM ELIGIBILITY
Mr. Young. Thank you, Mr. Chairman.
Mr. Secretary , we all want to be guardians of the taxpayer
and stop abuse. In the 2014 Farm Bill, there is a requirement
that USDA define those persons who are ``actively engaged in
farming'' in order to receive federal farm payments. This
provision will help end abuse of farm subsidies by limiting the
number of individuals eligible for them.
When does the USDA expect to have a final rule on the
definition of ``actively engaged in farming'' for payment
restrictions? Can you provide any comment on that whole issue
in general?
Secretary Vilsack. Congressman, I am a little hesitant to
say when a final rule is available. But I can tell you that the
proposal that we are going to put forward will be coming very
soon for comment so that people will have the ability to weigh
in on whatever it is we propose.
And let me also say that this is an issue which I hope the
expectations meet the statutory reality, which is to say that
when Congress fashioned the Farm Bill, it basically created a
fairly narrow lane for the USDA to navigate on this issue. It
is suggested that whatever we come up with is not going to
necessarily impact family farming operations. It is not going
to impact corporations because you only have a single payment
limit anyway.
So what we are really focused on are limited and general
partnerships, a couple percentage points, if you will, of the
overall farming activity in the country. So it is a relatively
small group of folks who are going to be impacted and affected
by what we do.
The second thing I would say is that as we look at this, we
have to make sure that there is an appreciation and
understanding for the complexity and size, and the differing
complexities and sizes, of operations around the country. What
you and I are used to is fundamentally, I suspect, a little bit
different than what the Chairman is used to, which is
absolutely different than what Representative Farr is used to.
And you have to understand that, and you have to appreciate
that in formulating any kind of rule.
Last but certainly not least, we are all about trying to
maintain confidence in this program. So it is important to
close these loopholes so that people cannot unfairly criticize
the safety net totally, which is ultimately what happens when
there is an egregious circumstance. It taints the entire safety
net, and the safety net is extremely important to maintain for
producers.
Mr. Young. I appreciate those comments and appreciate you
being here today. Thanks for your service and your leadership.
Many members here have thanked you for coming to their
districts. I want to thank you for coming to my district every
weekend or every other weekend since you live there and I see
you at the airport.
Secretary Vilsack. We will see you at the Booneville Tap
for breakfast.
Mr. Young. I will take you up on that.
Mr. Aderholt. Ms. Pingree.
GENETICALLY MODIFIED ORGANISMS
Ms. Pingree. Thank you, Mr. Chair.
Well, thank you. I know the topic of GMOs has come up
several times in this hearing, and I appreciate your last
overview on all the things you are workingon. I will be looking
forward to hearing what comes up in the next couple of weeks
and maybe get a little more sophisticated understanding of how
the bar code works. You brought that up last year, and if that
is going to move forward at some point, it will be good for
people to know more about it.
I just want to add in one other part of the conversation, a
little bit about the brand integrity. You made the point in
your testimony that organics has become a $35 billion industry.
I raise organic crops, have been involved in this topic since
the 1970s, and I have really seen enormous change from this
being a fringe sideline to now really a mainstream industry
that certainly in New England has saved a lot of farms, brought
people back to new markets, given people better pricing. There
is a lot to be said about it.
I am always interested in how much young people are engaged
in this topic, whether it is GMOs or organics. And you know,
and I will not get too carried away here, but you know there
are a lot of things about what goes into an organic label,
including that the ingredients are non-GMO.
So last September I was a little distressed to read about
the USDA's announcement that unapproved GMO wheat was
discovered in the U.S. for the second time in as many years.
And I know you know a lot about this, so I do not have to go
through every detail here. But GMO wheat has not been approved
for commercial usage. My understanding is that this wheat
discovery was part of a drift left over from a Monsanto GMO
field tried in the early 2000s.
In that same announcement, you said that you were closing
the investigation into a May 2013 GMO wheat contamination
episode in Oregon without really any explanation. I could go
through all the details with you, but you know this question.
It certainly threatens the integrity of the market for people
who market here and abroad.
And with the growth in this market and questions coming up,
about some of the issues that will come in around trade as
well, I want to know, what are you doing to amend the field
trials for GMO crops to ensure that these types of
contamination episodes are prevented in the future? Are you
actually conducting future tests to determine the extent of the
Monsanto contamination? Is there funding for this kind of
testing?
I know I have heard the Department say before that some of
the contamination issue could be solved by better neighbor-to-
neighbor relations, and I understand that is an important part
of it. I live in a small town. I know how important it is when
people can communicate with their neighbor. There has been
suggestion that there be some kind of insurance to protect
people against this.
But I am worried that insurance and relationships do not
take care of potential brand integrity. And as this market
grows--and I know there are a lot of people who will debate
forever about whether you should have a label, whether you
should know if it is a GMO crop, or whatever--but the fact is
the standards include and more, and more companies are saying,
no GMO product can go into this brand. And as consumer demand
grows, I do not want the USDA to be less vigilant about how we
protect that.
Secretary Vilsack. Well, there are no doubt research
projects underway, and no doubt we are holding those who are
conducting the research to rigorous standards relative to
safety. We are also expanding research on the issue of drift so
that we have a better understanding of precisely what it is.
And I think there is going to be an executive board, if
there is not already engaged, a discussion both domestically
and internationally on precisely what it means to say that you
are GMO-free. As testing mechanisms become extraordinarily
precise, what is it, so many parts per what? And I do not know
that anybody has the answer to that, but I would suggest that
we collectively need to be asking that question and answering
it so that the brand integrity is protected because it is a
high-value proposition.
And the discussions of stewardship and risk management
tools are designed to create an understanding or a perception
that we understand the importance of maintaining that brand.
And that is why we continue to look at ways to strengthen the
organic program. It is why we are excited about the organic
research initiative that we have launched through the Farm
Bill. It is why we are excited about the marketing assistance
that we are providing.
So it is a holistic effort because this is a growing aspect
of agriculture, and you are correct that there is a lot of
passion and enthusiasm, a lot of entrepreneurship, and it is a
way for new and beginning farmers to enter without necessarily
having to buy a very, very large operation.
Ms. Pingree. Great. Well, I will end with that. And thank
you again for your testimony and your presence here today.
Mr. Aderholt. Mr. Bishop.
RURAL HOUSING PROGRAMS
Mr. Bishop. Thank you very much. I have got a couple of
questions.
The first one is regarding rural housing. Despite proposing
an overall 7 percent increase in domestic discretionary
funding, the Administration again proposed to cut the budget
authority for USDA housing programs by more than 27 million. If
enacted, the President's budget would cut rural housing
programs by $235 million, or 61 percent since 2010.
Likewise, USDA proposed to reduce the Section 523 Mutual
Self-Help Housing program by 60 percent, or $17.5 million to
just $10 million. This is a program where families work on
nights and weekends to build their own home.
While these are relatively small programs, if utilized,
they cumulatively represent enormous opportunities for
constituents in my district and others on this Committee in
rural areas. And given that the traditional public housing and
Section 8 voucher programs are nearly nonexistent in rural
communities, what can we do to make sure that there is an
adequate supply of housing, particularly rental housing, for
our rural and poor communities?
Secretary Vilsack. Congressman, your question, I think,
requires me to point out that over one-half of the
discretionary budget that I have control over and that you all
make decisions on is allocated to food safety, rental
assistance, WIC, and fire suppression and forest management.
Just those four items.
All of those items are important. And in the rental
assistance area in particular, because Congress over a period
of years has gone from fully funding a unit for the life of the
unit to doing it on a year-to-year basis, every single year for
the next 10 years we are going to continue to see increases in
rental assistance required unless we do a better job of
adopting some of the reforms we have suggested because the
programs that were funded for 20 years or 15 years or 10 years
are going off that program, and they now have to be funded
every single year. So it places a great deal of stress on
housing generally because you have to continue to bump up
rental assistance.
You have also a significant problem on the horizon, and
this is something, Mr. Chairman, that we have not had a chance
to talk to you about but we need to talk to you about, and that
is that as the mortgages on these rental assistance properties
are paid off, they fall out of the program and there is not a
voucher associated with that. So you are looking at units
coming out of the program, but you still are going to have
families in need of the program.
And so I have asked my team to take a look at how we might
be able to extend some of those mortgages, reduce payments for
the property owner, and have the property owner commit to
taking the additional income that they have and creating
improvements to the property so that you get a continuation of
the program, you get better units, but folks are not kicked
out.
Mr. Bishop. You do agree, though, that there is a need, and
particularly as you look at StrikeForce and look at the
persistent poverty counties across the country, that housing is
as much a vital need as food and other economic activities.
Secretary Vilsack. No question about it. And this budget
basically supports nearly a quarter of a million families in
subsidized rental assistance and 171,000 home loans. But the
reality is that when 50 percent of your budget is consumed by a
small number of items, it puts a lot----
Mr. Bishop. There is a lot of stress. I understand that.
Secretary Vilsack. There is a lot of pressure. And you have
got to make decisions.
FARM SAFETY NET PROGRAMS
Mr. Bishop. And the other thing, farm income and the farm
safety net. A couple of weeks ago, the Economic Research
Service (ERS) released its 2015 farm sector income forecast,
which stated, ``Net farm income is forecast to be $73.6 billion
in 2015, down nearly 32 percent from 2014's forecast of $108
billion. The 2015 will be the lowest since 2009.'' They also
pointed out that the annual value of U.S. crop production is
expected to decline in 2015 from the 2013 record high value,
reflecting net inventory loss and the third straight year of
declining cash receipts for crops.
And then finally, the ERS reported that the net cash farm
income is $79,200 for all farm businesses in 2015, which is a
decline of 22.7 percent from 2014, which represents the average
amount of cash available to individual farmers to pay and
service their debt, pay family living expenses, and make
investments.
I know that agriculture is very cyclical. In one year you
can record crops and income across commodity lines, and in
another year farms can lose their shirts. And it is exactly
that kind of volatility which led Congress to create farm
support programs in the first place.
Let me ask you, should farm income continue to decline over
the next few years, do you expect that the demand on our farm
and our agriculture support programs will rise as well? And how
is that going to be impacted by the worldwide agriculture
competition?
And what do we have to look forward to, and how are we
going to anticipate and deal with perhaps this trending for a
decline in farm income if we are going to produce the highest
quality, the safest, the most abundant, and economical food and
fiber anywhere in the industrialized world, which is our claim
to fame now?
Secretary Vilsack. You know, I get a little bit troubled by
the headlines on farm income. Since pitchers and catchers
reported recently to spring training, I have got kind of a
baseball mentality here. You know, if I hit .370 as a ball
player one year and I hit .320 the next year, I suppose you
could say that my performance had declined. But my guess is
that you would still be paid millions of dollars to hit .320.
And the reality is the farm income is coming off of record
highs because commodity prices were exceedingly high. And that,
frankly, created some stress on some aspects of agriculture,
the livestock industry in particular. So we are going to see
the livestock industry do a little bit better.
The answer to your question is a combination of producers
making informed decisions about the market and understanding
what they need to do in terms of planting. When you plant a
record number of acres and you have decent weather, you are
going to have a heck of a crop. And when the rest of the world
also at the same time has a heck of a crop, then you have got
abundance, and that obviously is going to drive prices down.
So I would expect and anticipate that people will start
making some market decisions about what they farm and what they
grow, and the market will adjust, and that will affect. The
second thing is----
Mr. Bishop. Does that mean that you are going to have to
get involved in more closely advising and educating the
agriculture community perhaps better than has been done in the
last two or three years?
Secretary Vilsack. Not necessarily. I think it is----
Mr. Bishop. Because obviously, somebody has not been
planning consistently with what the expected----
Secretary Vilsack. Well, no. Farmers, Congressman, have
done this forever. This is not a new phenomenon. It is very
cyclical, and the reality is that is why you have got safety
net programs. That is why we expect the safety net programs are
probably going to get triggered sooner than it was anticipated
when the Farm Bill was signed.
And it is why we are going to continue to focus on
marketing opportunities. It is why you need trade. It is why
you need trade promotion authority. It is why you need trade
agreements that allow us to move more product to market, and
why you need to focus on the efficiencies.
It is why you have to find additional uses for these
products, which is why this Administration supports the biofuel
industry and the bioeconomy, the ability to take agricultural
waste product and convert it into a variety of other materials,
which the Farm Bill is now going to allow us to do.
So it is a combination of all those things. The key here is
making sure right now that producers, as they make a very
important decision that they have to make--we have had over
nearly 5,000 interactions with the producers about ARC and PLC,
what their options are. We have created computer models that
they can put their numbers into; over 176,000 folks have
utilized that.
And hopefully by the end of March they are in a position to
determine for us, for the next four or five years, ARC is
better or PLC is better, and that they make the most informed
decision. That is the focus right now, making the most informed
decision about the safety net.
Mr. Bishop. Thank you.
MEAT ANIMAL RESEARCH CENTER
Mr. Aderholt. Thank you, Mr. Bishop.
Before we adjourn the hearing, I want to just mention a
couple of key areas that are important to the subcommittee. As
States begin issuing exemptions to schools that are seeking
flexibility from the school meal whole grain requirements, I
would ask that you would keep the subcommittee informed of the
process.
Second, I also appreciate the Department issuing the
guidance to WIC State agencies, allowing participants to
purchase white potatoes with their cash value vouchers. As the
Institute of Medicine continues its review of the WIC food
package, I would ask that you would also keep the subcommittee
apprised.
As you know, the fiscal year 2015 omnibus contains report
language directing you to submit a report with language of
legislative changes needed to implement the Country of Origin
Labeling, otherwise known as COOL, that complies with
international trade obligations. The report is due no later
than May 1st, and we look forward to receiving that report at
that time.
Lastly, Mr. Farr and I have asked the Inspector General to
conduct an audit of the Meat Animal Research Center (MARC), and
we have heard about the review that you have ordered. And on
behalf of the Subcommittee, we would like to request that you
share the results with us on that as soon as you are able to do
that.
Secretary Vilsack. Can I comment on that issue?
Mr. Aderholt. Yes, please.
Secretary Vilsack. As you know, we did order a review. I
want to make sure that everyone understands the three primary
reasons for ordering that review.
First is to make sure that we identify current practices
versus prior practices because the Times article that generated
this really had--it was difficult to determine whether they
were talking about things that occurred 20 years ago or 30
years ago or things that were occurring in the very recent
past.
Secondly, to make sure that we identify the responsible
party, we have a standard that is not statutorily required but
that we do wish to live up to, which is the animal welfare
standard. Research that is done at these facilities oftentimes
involves multiple different parties other than ARS personnel,
and so we want to make sure whatever concerns there might be,
that we have identified who is responsible for that research.
And then finally, to the extent that there have been
concerns that are legitimate, we want to make sure we get a set
of recommendations that we can institute relatively quickly. We
also have an ombudsman that we have appointed, and that
ombudsman is going to be the recipient of any additional
concerns. And that person is also going to conduct additional
training.
And then once we receive the 60-day report, and we are
happy to share it with you, we will also begin a process of
reviewing other locations where there are research projects
that we are involved in.
Mr. Aderholt. Thank you. And like I said, as you move
forward, keep us posted on that. We would very much appreciate
that.
And with that, the Subcommittee is adjourned.
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Friday, February 27, 2015.
NATURAL RESOURCES CONSERVATION SERVICE
WITNESSES
JASON WELLER, CHIEF, NATURAL RESOURCES CONSERVATION SERVICE
MICHAEL YOUNG, BUDGET OFFICER, U.S. DEPARTMENT OF AGRICULTURE
Introduction of Witnesses
Mr. Aderholt. The Subcommittee will come to order. I would
like to welcome Mr. Jason Weller, Chief of the Natural
Resources Conservation Service, and also Mr. Mike Young, USDA's
Budget Director, to the Agriculture Appropriations Subcommittee
this morning. Welcome to both of you for being and thank you
for being here.
Opening Statement--Mr. Aderholt
We convene today, of course, to review the Natural
Resources Conservation Service's Fiscal Year 2016 budget
request. NRCS requests a total of $1.03 billion in
discretionary funds, and it is for salaries, expenses,
programs, and activities. In addition, about $3.2 billion will
be available through the Farm Bill's mandatory conservation
programs to farmers, ranchers, private forests, land owners, to
help them preserve, protect, and enhance their land.
For several years the NRCS has been working to bring its
financial and accounting systems into line with today's
transparency and accountability standards. This work is
enormously important to ensuring the integrity of NRCS's
operation, and also their programs.
The cooperation work between the NRCS and the farm, ranch,
and forest land families to conserve and to maintain their
productive lands is often unrecognized. The science-based,
locally-led and volunteer approach to conservation on these
lands is an incredible legacy that arose out of the dustbowl
years. This legacy is worth defending. But we must have an
appropriate so-called ``back-office systems'' and controls in
place to ensure that it can be passed on to future generations.
NRCS is about to embark on a significant restructuring that
will strengthen integrity of its programs and its systems to
ensure the legacy of the science-based and locally-implemented
and voluntary conservation continues. The plan appears to be
thoughtful and to be thoroughly vetted.
Chief Weller, I would like to congratulate you and also
your staff on the time, the effort that you put in. Also, the--
I am sure--blood, sweat, and tears that were invested in
putting this plan together over the past several months. And I
look forward to hearing more about it as we go through the
hearing today.
So, at that, I would like to recognize the Ranking Member,
Mr. Farr, if he has any comments he would like to make at this
time.
Opening Statement--Mr. Farr
Mr. Farr. Thank you very much, Mr. Chairman. I have no
prepared comments, I just have some observations.
I have the privilege of flying across this country every
week, and back to California. And it hit me, looking out the
window of the plane often, how much of this land is an open
space in America. And almost all that land is in private
ownership. And it really strikes you that--what a delicate
balance there is, because you have people who own that land,
and much of it is in productivity, with agriculture and/or
grazing. There is no way in the world that you could make all
that land public, or lock it all up, but it is really important
that--best management practices and smart use of land.
I think that is where your agency really comes in with
technical assistance, kind of an advisor, almost as people have
financial advisors, you know. You do land conservation--not
even sure the word ``conservation'' ought to be in--best
management practices of what we have learned in applying that,
and giving them assistance with that.
I would be very interested to know how we can leverage that
more with private-public partnerships--so you work with a lot
of different agencies. There are a lot of silos back here in
Washington. But I think we are at a time as the Chairman
pointed out--that, with limited resources, we are going to have
to get better collaboration, get a better bang for our buck.
And I am wondering if you can, in your remarks, talk about
how we could leverage state and non-profit organizations so
that they were all kind of going in the same direction, and
putting our money, matching money and things like that, carrot
stick-type thing--I think that is what you are trying to do
with reorganization, and I look forward to hearing about it.
Thank you very much.
Mr. Aderholt. Thank you, Mr. Farr. Chief Weller, the floor
is yours.
Opening Statement--Mr. Weller
Mr. Weller. All right. Well, thank you very much. Good
morning, Chairman Aderholt, Ranking Member Farr, members of the
Committee. I am very honored to serve as chief of the Natural
Resources Conservation Service, and work for the 10,500 men and
women that work in this agency across the United States. And
hopefully, I am able to well represent what they deserve, in
terms of good representation today before the Committee.
I am particularly proud of where I work, because it is an
example of what I view government at its best, in that we
actually empower people. We empower families, we empower
businesses, we empower communities to take charge of their
operations, their businesses, to make investments on their
lands and their operations to be economically successful, but
also better manage those resources for the long term.
Ultimately, to grow the feed and fiber and food we need, as a
nation, but also maintain the quality of life that we deserve
and expect in this country.
Mr. Farr, with respect to your observation about the United
States, you are absolutely right. If you look continentally, 70
percent of the land in the lower 48 is in private ownership.
And, particularly in the Southeast and the East Coast, it is
upwards of 80 or 90 percent of the land is in private
ownership. So if you talk about the long-term environmental
quality or economic vibrancy or ability to feed ourselves, but
also still have water and wildlife and other amenities we
demand, it is ultimately the decisions those millions of
private landowners make.
And, in my view, another way I think about NRCS is as one
of the world's largest management consulting firms. We are
actually out there every day, working one on one, voluntarily,
at the invitation of those land owners, to help them make wise
business decisions, which ultimately help their bottom lines,
but also help them better manage their soils and the water and
the habitat more effectively.
So, I have sort of four core priorities for this agency. I
just want to briefly touch upon that, hopefully, you will see
reflected in this budget.
Number one is that I want NRCS to be known as and to
continue delivering excellent and innovative service across the
United States. I think that is emblematic on how this agency
took what Congress provided us last year in the new Farm Bill,
and we are ready. In a matter of weeks we caught it, we
pivoted, and delivered on the promise of that Farm Bill. So we
got all the programs out last year. That resulted into tens of
thousands of contracts, billions of dollars of financial and
technical assistance, and we got all our rules out on time. And
so it is no muss, no fuss, no drama, we got that Farm Bill
implemented.
Second priority is that we need to be able to modernize and
strengthen NRCS's Conservation Delivery System. Chairman
Aderholt, to your point, one of the examples, that is our
administrative transformation, where we are looking at how to
transform NRCS as the business of conservation so we can become
a leading-edge example of how government can manage itself more
effectively, more efficiently, and ultimately provide better
customer service.
But another example is the Conservation Delivery
Streamlining Initiative. Hopefully I can also expand upon that.
This Committee has entrusted us resources the last several
years to invest in this modernized IT infrastructure, and we
have delivered on that. The first major component, first of its
kind, cutting edge technology which is then empowering land
owners to manage their business and interact with us without
having to come into a field office.
Third priority is to enhance and expand NRCS's technical
and scientific capabilities. Again, that is exampled from our
soil health campaign, where we are helping farmers and ranchers
not just manage the physical and chemical properties of the
soils, but also the biological properties of the soils,
treating the soil as a living ecosystem, so the livestock below
the surface of the soil can support the livestock and the food
production above the surface.
But also, then, part of our budget request is increased
support for the Conservation Effects Assessment Project, CEAP,
as it is known by its acronym: world-class, cutting-edge, only
one of its kind, in my view, in the world, that is looking, on
a continental basis, what is the return on investment when we
invest in conservation. What does that mean for the land owner
and, ultimately, for the resources in that area?
And the fourth priority is to expand the scope, the reach,
and customers and partners of NRCS. Again, that is--I would
like to, hopefully today, expand upon this. An example of this
is our Strike Force Initiative. We are investing serious money
in the poorest communities in this country, working with land
owners for a variety of reasons have been left behind. We are
making a difference. We are offering economic opportunity and
hope to these families. But, in return, also helping better
manage the resources.
And also, the Regional Conservation Partnership Program.
Again, to your point, Mr. Farr, about how to leverage from the
private sector, from foundations, state and local governments,
other federal agencies, philanthropic investors. We have an
example of how we are trying to do this a little bit
differently, outside the box, and I would like to talk a little
bit more later on today about that new approach.
I really appreciate this Committee's support for this
agency, for conservation in general, but for our agency,
specifically. And I really look forward to today's
conversation. Thank you, sir.
[The information follows:]
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ADMINISTRATIVE TRANSFORMATION
Mr. Aderholt. Thank you. Let me just begin by mentioning
back in 2013 the Committee approved the NRCS's reorganization
plan to separate the management of its business operations from
the management of its policy and programs. This was an early
step toward the changes mentioned in your testimony regarding
the streamlining and improvement to NRCS's administrative
functions.
What is the status of the plan to transform the
administrative services?
Mr. Weller. So just to real quickly--for other Members, for
their awareness, what NRCS--we have invested in--the last
couple years, taken a really hard look at how we do the
business of NRCS. So, principally looking at our human
resources, our financial management, and our contracting
property management. Big picture, what are--the vestige of how
we manage that business is we are very decentralized. So think
about us being a franchise. We have 53 independent franchises,
each with their own HR operation, their own budgeting
operation, their own contracting operation.
That worked well, historically. But now that we have to be
more efficient and more cost-effective with the money, the
irony is, corporately, we are probably spending too much, in
terms of the management. But if you look at each state, where
you have an independent state office, probably too thin. We
don't have enough support in each state.
So, for example, you're one person deep in your budget
office. You are one person deep in your HR office. That means
you are one retirement, one sick day away from that business
operation shutting down. So what we are trying to look at is
how do we become more cost effective and a better-managed
business of NRCS, be more accountable, be more streamlined, but
also ultimately provide better service, more timely, internally
and externally.
And so, yes, we have invested the last two years, taken a
look at how to harness the latent power and capacity of all of
these professionals. We have close to 600 professionals across
the United States in all these different disciplines. How do we
use their expertise, but really then, instead of having them
wear multiple hats, expect them to be jacks of all trades,
instead allow them to be the experts they are, and focus on
what they are trained in, they have their educational
attainment in, they have their tools and capabilities to be
focused on. So you allow accountants to be accountants, you
allow contracting officers to be contracting officers, and HR
specialists to be HR experts.
And so, we are creating national teams that will be
providing service from the field office to my office, and
everywhere in between. And we are looking forward--we have
already stood up several of these national teams for managing
our fleets, managing our reimbursable payments, managing our
budget processes, managing our hiring staffing, and it is
showing--it works. You can get higher quality service delivered
faster and cheaper.
And so, we are looking forward to--we are going to be--we
briefed the Committee staff earlier last week--finalizing final
approvals within the Department, and we look forward to them
coming before the Committee officially, and seeking your review
and concurrence with this approach. The goal is to have this
completely stood up this calendar year. And we are really
excited about what this will ultimately mean for the long-term
resiliency and cost-effectiveness of our agency.
Mr. Aderholt. You mentioned the employees. What does it
mean for the current employees?
Mr. Weller. So we have--I have core commitments to those
employees. Number one, everyone gets to keep their jobs. This
is not a large RIF. They will all remain NRCS employees.
Importantly too, they all get to keep their grade and pay.
Three, they can stay where they are. We are not creating a Taj
Mahal of administration somewhere, where everyone has to move
to. They can stay in their current locations, because we have
the technology and tools to manage this, virtually.
And so, we really, then, are looking to then get these
folks realigned into teams where you have experts delivering
what they are trained to do. They are being supervised,
importantly, by experts, then, who know this discipline.
Because HR policy is incredibly complex. Contracting policy,
grants and agreements policy, very complex. You want to have
experts doing this day in and day out. You got economies of
scale. But then you want to have good training, the
supervision, the collaboration that occurs in these teams that
then, ultimately, we will expect.
So I think this is, ultimately, for our employees, going to
be a better morale-booster. Employees who have been on these
interim teams serving on detail assignments, the feedback we
get is that they are really excited. They actually see this as
a big improvement in their quality of life. It is less stress.
But then also, we all save some time and money, as well, at the
end of the day.
FINANCIAL AUDITS
Mr. Aderholt. As you are aware, the Inspector General has
issued numerous reports under financial management system. And,
as you know, this Subcommittee has been concerned about the
audits for several years. NRCS has made great progress, but
there continues to be a great number of deficiencies.
I understand that the planned administrative transformation
also addresses these deficiencies and concerns. What is the
relationship between audits and your work to transform the
NRCS's administrative functions?
Mr. Weller. So there is no one more concerned about the
financial audit and our financial management capabilities than
me. And part of--this is very personal for me, because in a
past life I actually was the OMB budget examiner for this
agency. And my parting gift, when I was at OMB, to NRCS was to
require them to go into a stand-alone audit, some parts.
So, fast forward to today. I am now bearing the joy of
that--what I inflicted upon myself. So kind of back to the
future. [Laughter.]
This agency has come a long way. If you go back to where we
were three years ago, we had seven material weaknesses.
Completely unacceptable. In just the last three years we are
down now to three material weaknesses, just three weaknesses.
And now we are on the cusp of getting this done. We know what
we need to do, and this administrative transformation is going
to get us over the line. So, instead of having 53 different
business centers writing into our general ledger, we will have
one team writing into our general ledger. While instead of
having 53 different reimbursement payment teams issuing
payments, we will now have one team issuing payments to this
agency, using standard operating procedures, standard policies,
same technology, the same training. So this is absolutely the
way we will nail it, and stick our audit.
Mr. Aderholt. Okay. Just in closing, when do you expect to
achieve a clean audit?
Mr. Weller. So, our goal this year, it is very complex. I
don't want to equivocate here. Our goal is this fiscal year to
end with clean balances. This is the goal, so that our auditors
can tie to our balances, which then sets us up for clean
balances for 2016. And then you need to maintain your internal
controls for a whole fiscal year. So the goal is, by end of
2016, they will be able to get an opinion on our books. That is
what we are aiming for.
Mr. Aderholt. End of the year.
Mr. Weller. Yes.
Mr. Aderholt. Mr. Farr.
LEVERAGING RESOURCES
Mr. Farr. Well, thank you, Mr. Chairman. I am so impressed
with--I guess we call you Chief Weller. Sounds like law
enforcement. But I am really impressed with your ability to get
in and do that reorganization, because there is so much of that
that is essential in government these days. In all levels, not
just the federal government. California is into a term now
called ``realignment,'' where we are going to--reorganizing.
Is that because you were a member of this staff, and you
got really good training. Perhaps, Mr. Chairman, we ought to
require that all the agencies have to hire former
Appropriations staff members.
I would like to pursue just that, what you are trying to do
to leverage your resources. I mean I represent a really
beautifully environmental area. We had dozens of non-profits,
you know: Save the Redwoods, the Big Sur Land Trust, Santa Cruz
Land Trust, three or four farm land trusts. I will bet, if we
add it up, we probably have 25 land trusts working in my area.
All of them have a different client, different agenda,
different staffing, but they all have one thing in common, they
all want to come and have the land that they buy transferred to
the federal government.
But they are doing a lot of work with getting agricultural
easements on lands by big land owners, and there is a lot of
interest in that, just because they want to preserve their land
and agriculture forever and ever, and they don't want their
children to have to sell it off or dump it to some big
developer. So there is a lot of private-sector interest in
this. It is just I am interested in how we can better leverage,
because, as you know, they are all in their own silos.
I have got a lot of big Forest Service in my area. Forest
Service is in your Department. Are you working with them also,
so that there is kind of a one-stop--you talk about being
that--what, strike team? Is that--could you explain more about
that?
Mr. Weller. Yes, absolutely. So there are two direct
examples I will give you, sir. And one I mentioned in my
opening remarks is the Regional Conservation Partnership
Program (RCPP), which is a new authority in the 2014 Farm Bill.
The basic idea here is you actually invite local partners to
devise their own projects. You ask them what do they want to
do.
So, what we are finding is that, more often now, you go
into places like the Salinas Valley or the Pajaro Valley in
your district, for example, and there is a lot of people doing
a lot of really good things. But, more often than not, we are
not coordinated. We are putting a lot of money on the ground,
but in a way we are like ships passing in the night.
So what we did with the Regional Conservation Partnership
Program is sort of like pulling a sock inside out. Instead of
the federal government saying, ``This is what we are going to
do in your community,'' instead we ask, ``Community, what do
you want to do? And we are here to support you.''
So, we opened it up to competition, and we got
applications, 600 applications, from every state in the
country, from all over the country. And folks were really
excited about this. And what it does is it catalyzes that
locally-led approach, where you get, like, the Santa Cruz
Resource Conservation District (RCD). They then talk to
Driscoll's Berries. They talk to the Pajaro Valley Water
Management Agency. They talk to Santa Cruz extension. They talk
to the marine sanctuary. And they leverage the resources up
front, and then they come to us and say, ``NRCS, this is what
we would like to do with the program in the Pajaro Valley to
save water, but also to increase groundwater recharge.''
And so, one of the projects we funded, then, in the Pajaro
Valley this year through RCPP first round was $800,000 of NRCS
money matched by $900,000 of the partners. So, total project,
over $1.5 million that they estimate is going to save over 400
acre-feet of withdrawal from the aquifer, but also add
additional recharge to the aquifer of 600 acre-feet. That is a
lot of water savings in a water-scarce area, but you are
getting industry involved-- Driscoll's Berries. You are getting
extension to provide really good outreach and education. You
are engaging RCD, so it is a locally-led approach. And the
federal government, then, is just a co-investor. We are a true
partner in this. So this is one example.
Nationally, we have 115 of these projects that-- they are
just showing this is an approach we really absolutely have to
pursue.
Mr. Farr. Well, my time is up, but I really appreciate
that. The ag industry is really excited about what Driscoll is
doing, and Driscoll is, I think, taking a national lead in
talking about how agriculture can do a lot to improve water
conservation and water quality. Thank you.
Mr. Aderholt. Yes, thank you. We are getting a call for
votes, and we anticipated we were going to have a little bit
more time. And so we are trying to make sure everybody gets
their questions in. But we are going to go on as long as we
can.
So, Mr. Valadao.
CALIFORNIA DROUGHT INITIATIVE
Mr. Valadao. Thank you, Chairman.
Thank you again for coming and spending some time with us
today. My question is about a drought initiative that started
in February of 2014. About $25 million was spent. Can you give
me an idea of what type of technologies and what type of
response, and even some of the improvements, or maybe how much
efficiency we have seen? Do we have any numbers that we can
see?
Mr. Weller. Yes, sir. Absolutely. I know in California--the
whole state, but particularly in the San Joaquin--this is a
huge issue. So, last year, just using our financial assistance
program alone, we added an additional $25 million into
California to go into the drought-stressed areas. Sort of three
core things we are looking at.
First, for fallow fields that we--there is no water to
plant, we are looking at putting in some kind of cover. So
whether that is keeping residue on the land, or actually
planting a water crop that doesn't--or a cover crop that
doesn't require a lot of water resources, lock those soils
down.
For folks that still have access to water, we are secondly
trying to help upgrade their irrigation efficiency, so their
microdrip irrigation--you know, remove flood irrigation, move
to a different improved water management. And then, for grazing
lands, again, helping them put in the infrastructure to support
cows, getting cattle out of the riparian areas to reduce
pressure on water there, developing water, you know, upstream,
putting the proper fencing that works in receding pastures and
range land areas to maintain the vitality of those areas.
The big picture, though, we have been very focused on
drought, long-term, in California. So we have actually
partnered with Reclamation, joint partnership. Reclamation is
making investments in their delivery mechanisms, their canal
systems. And then we meet them at the farm gate, and we do the
on farm savings. So this partnership, we have invested over $20
million over the last several years in Central Valley. We
estimate these projects, when complete, will save 167,000 acre-
feet per year, which is a lot of water. That actually equates
to over 550 billion gallons of water, which sounds like a lot
of water. Well, that is actually enough water to supply 3.7
million homes with drinking water, annually. That is the amount
of water we are saving. So we are very focused on drought and
water scarcity in California.
Mr. Valadao. All right. Well, I appreciate that. Thank you
again, and I yield back.
Mr. Aderholt. Mr. Bishop.
Mr. Bishop. Thank you very much. And welcome, again, Chief
Weller.
Mr. Weller. Thank you.
SOCIALLY-DISADVANTAGED FARMERS AND RANCHERS
Mr. Bishop. Sounds good to address you as chief. Your
budget justification indicated that you have successfully
provided $99 million through 3,764 contacts with socially-
disadvantaged farmers and ranchers to treat approximately 2.3
million acres. Is this on an annual basis, or is it the
cumulative total over several years? And do you have any plans
to expand the activities?
Many of us at some point would like to see persistent
poverty counties in the nation have a targeted plan of action
from USDA and all federal agencies, really, whose mission it is
to assist our lowest income communities, and particularly our
rural areas. I congratulate you on what you are doing, but can
you kind of expound on that.
And I also want to congratulate you on your partnerships
with the North Carolina A&T and Florida A&M, with regard to the
biological, agriculture, and system engineering academic
programs, which is a great partnership. But I would like to
also remind you that there are 14 historically black land grant
universities, not the least of which is Fort Valley State
University in the Second District of Georgia. And all of them,
I think, are in need of assistance. And if there is any way,
any plans that you have for expanding those partnerships, I
think it would help you help the nation. And, of course, it
would help those universities.
Mr. Weller. Yes, sir. So yes to both. First, starting with
StrikeForce, very quickly. So we started--actually, Georgia was
one of the original pilot states. And NRCS--I am really proud
of how NRCS stood up here, and complete hats off to those field
folks. They worked mightily to start working with community-
based organizations in Georgia and Mississippi and Arkansas. We
went into every county in the state to improve outreach, to
hold community sessions, town hall meetings. We had people at
those meetings with contracts in hand, ready to sign people up
as they leave the room, ``Let's get you in programs.''
So, if you look at just last year alone, yes, it was over
$90 million just annually, just to socially-disadvantaged
producers. But, in total, NRCS invested over $286 million into
the highest poverty counties in the Strike Force. Over the last
four years, $992 million in financial assistance went to those
poor communities. And so these are absolutely job-creating
investments. It is helping those families put modest
investments on their operation to help their bottom line. But
it is also then a complete job creator, in really offering
economic opportunities in those communities.
Regarding interest in working with historically black
colleges and universities, 1890s, absolutely. Actually, I just
had a meeting last week with the new president of the Student
Conservation Association. We have a shared interest in the Gulf
State region, in particular, improving their association's
engagement with the historically black colleges, and also
Hispanic Institutions. We do, as well, because we have to start
employing a 21st century workforce that is representative of
this country, and ensuring we are having diversity in every
sense of the word in the agency. So I am very much focused on
this, and would be happy to visit with you or your staff about
how we could work with you on----
DRONES
Mr. Bishop. Thank you. We will follow up on that. I
appreciate that very much.
Under the Natural Resource Inventory Program, you acquire,
analyze, interpret, and deliver data through the NRI program
and Conservation Effects Assessment Project. Can you tell us if
you have any plans to utilize drones to assist in the
collection of information? Because you do a lot of photography,
put a lot of contracts out to take pictures, and there is a
tremendous amount of interest in the use of drones and
agriculture, particularly in assisting the optimal design of
and layout of soil and water assessments, and other related
issues.
Have you looked at this issue? Are there any current inter-
agency discussions with FAA or other agencies concerning the
growth and the use of drones? Obviously, there are some
security issues involved, but there is also a great deal of
interest for commercializing that practice, and using it in
agriculture.
Mr. Weller. Absolutely. It is a new technology, but we also
have to be careful, because folks do have privacy concerns. FAA
also had safety concerns. So, in part, NRCS, we were sort of at
full-stop, let's wait for FAA to actually come out with a rule.
Now that the rule has been issued, we are trying to figure out
how NRCS can work within that to do remote sensing, but in a
way that protects privacy, assures land owners who are not--
there is a regulatory component, because I know folks have some
concerns when the federal government starts flying drones over
their property.
So we just need to make sure NRCS is doing this technology
in a way that is appropriate, that is sensitive to land owners'
concerns, but also then helps us do a better job of managing
resources.
Mr. Bishop. Thank you.
Mr. Weller. Thank you.
Mr. Bishop. Thank you very much. I yield back.
Mr. Aderholt. Mr. Rooney.
AGRICULTURAL CONSERVATON EASEMENT PROGRAM
Mr. Rooney. Thank you, Mr. Chairman. I have a very brief
question. A lot of my larger land owners, farmers, ranchers in
Central Florida, which I represent, a lot of citrus, beef
cattle--a lot of them are getting interested in this
conservation easement program that--you have consolidated a lot
of the easement programs into one new overarching program. I
just wanted you to give us an update about how that is going,
and how you have been working with the enrollees, or potential
enrollees, that want to participate.
Mr. Weller. So--yes, sir. The 2014 Farm Bill consolidated
all these programs we had into one new program called the Ag
Conservation Easement Program. ACEP is the acronym. Two
components to this. There is the ag land easement component,
which is like a working lands, grazing lands, row crop
protection, which is we basically provide financial assistance
to a state agency or to a land trust, and they go acquire the
easement. And then there is a wetland component, where NRCS
actually acquires the easement and does the wetland
restoration, but it is still privately-owned land.
It was well oversubscribed last year, so we invested $328
million. We got 144,000 acres of easements across the United
States. And so we are trying to do everything we can. We
actually just--I think today--issued the interim final rule for
the new program. So we have been working very hard with land
trust and state agencies across the U.S. to understand how the
program is working, how it is not, how we can fix it and make
it better, an easier experience for state agency or land trust
to work with us. But then also how to streamline this so, for a
land owner, they have a better experience, they get their
easements closed quicker, they understand kind of the rules of
the road, so it is much more transparent and they know kind of
what their responsibilities are, what they are getting involved
in, but also, hopefully, what they see the benefits are of
easements.
At NRCS, over the last several years, we put a lot of very
significant easement resources voluntarily into Central
Florida, working particularly with the grazing community, the
ranching community in Florida. A very strong interest in that
community, and we are very proud of that partnership with them.
Because what is great with this program, you can also have--you
can still have working lands. So as long as we have an
agreement on, you know, stocking rates and the management, you
can still run cattle on those wetlands, and so you still have
working ranch lands, but then you are also providing water
quality, flood protection, wildlife habitat on the same working
lands.
So, we are real excited about our partnership with
producers in Florida. Thank you.
Mr. Rooney. Yield back.
Mr. Aderholt. Mr. Young.
Mr. Young. Thank you, Mr. Chairman. Chief, how are you
today?
Mr. Weller. Very well, thank you.
NUTRIENT DISCHARGE
Mr. Young. Nice to see you again, Mr. Michael Young. I want
to reflect back on one of my colleague's comments regarding
drones. I appreciate your comments on privacy and respect for
land owners. Also please be cognizant of what is being done in
state legislatures and with state law regarding this, because
there are some things going on in the states that you will have
to reflect on as well. So thank you for your comments regarding
privacy and the need for and the attention to that.
In Iowa, we are working hard on a pragmatic approach to
reduce the amount of nutrients discharged from point sources
and non-point sources, wastewater treatment plants, as well as
our farm fields. We have got state, federal, and farmer dollars
that have been invested in this. It is a voluntary approach.
You have flexibility to target those programs, I understand, to
the needs of the region, county, and state. How much is the
NRCS contributing to this effort, and does it plan on
contributing more or less?
Mr. Weller. If anything, more. But it is--again, it is at
the invitation of those land owners in Iowa. But also,
crucially, to Congressman Farr's--again, his request, or hope,
that we are coordinating with government, with state agencies,
and also with non-profits and other private organizations in
Iowa.
And, again, coming back to the Regional Conservation
Partnership Program, there is two examples of this, two great
projects in Iowa. One, we partnered up with the State of Iowa.
The Department of Agriculture invested $3.5 million to then
complement the state's resources to help implement their
nutrient reduction strategy, which is part of this pragmatic
approach you are talking about in Iowa.
We also invested $2.5 million with the City of Cedar
Rapids, again, to do source water protection for that city. We
are working collaboratively with land owners up the river to do
land treatment, good investments on their operations to help
their bottom line, but also then to help protect drinking water
quality coming in to the City of Cedar Rapids. These are two
examples of that pragmatic approach we are trying to take in
Iowa, working voluntarily with land owners to protect, help
their bottom line be more efficient with their nutrients, and
better manage their soils, be more productive, then also
protect water quality for all Iowans.
So we are very much proud of our partnership with the State
of Iowa, but also with other associations like soybean, corn
associations in Iowa, as well as non-profit organizations, like
Nature Conservancy and other groups in Iowa. We are all
collectively partnering on this.
WETLANDS DETERMINATION
Mr. Young. Well, I appreciate that collective approach to
what we are trying to do on a voluntary level. I believe that
we will get it right. It is a matter of time. Some people want
it sooner, rather than later. But to get it right, it may take
a little more time. But we will see.
Last year the NRCS proposed updating the way it conducts
wetlands determination in the prairie pothole states--you know:
Minnesota, Iowa, North Dakota, South Dakota. How will the
wetland determination proposal affect producers? When there is
a review, will there be an ability for folks to have a second
request for review, and a second opinion, if they disagree with
a determination you make?
Mr. Weller. Yes. So, first, starting with what a producer
hopefully will experience with this, what we are proposing is
bringing a modern, up-to-date, scientifically-driven approach
to doing what we are calling offsite determinations. This is a
practice we have had at NRCS for decades. But what we didn't
have in the prairie pothole region is a consistent approach
across all four states. So, depending on where your property
was, you had a different approach that we needed to update.
So what this means, though, is actually, at the end of the
day, when we implement this--because we were just seeking
comments on this approach, so far--is better service for a
producer. So, right now, as you know, there has been a backlog,
particularly in North and South Dakota, but Iowa, as well. And
a lot of cases it is because it is on-site determinations. It
takes staff time. When you do an off-site determination, you
are using remote sensing technology, photography, LIDAR
coverage, other techniques to really do equivalent, if not more
accurate, determination approach.
Bottom line is time savings. So, the average number of time
it takes to do an off-site determination is six hours. The
average number of hours it takes to do on-site is at least 14
hours. Many of them are 40 hours. And that doesn't count all
the driving time. When you break that down into dollars and
cents, if you just take the assumed $30 an hour for, like, a
field technician to go out and do it, that equates to about
$170 to do an off-site determination. When you do on-site it is
like over $400 a determination, on average.
But when you multiply it out over, like, South Dakota,
where they have 2,500 determinations in the backlog, that is
the difference between $300,000 over $1 million. And when it
comes down to that kind of expenditure, when you add that up
across four states, you are talking real money. And that is
money I would rather employ back in the field to provide, you
know, technical assistance to producers, as opposed to
investing in a way that we could be more efficient.
So, to your question about what happens for the producer,
the first approach would be the off-site determinations, which
would be much more efficient. They will get determinations made
quickly. It is a preliminary determination. They don't like the
determination, they can then appeal it and they can then
request an on-site determination. They don't like the on-site
determination from the field staff, they can then appeal that
to the state office. They don't like the state office
determination, they can then appeal that to the National
Appeals Division. So there is absolutely all these protections
for a producer. We are not changing any of that, how that
works. We are actually just trying to streamline it and get the
determinations made faster and cheaper.
Mr. Young. So, with the off-site, it saves time. But you
make that up with the technology you are talking about to get a
more accurate read, you believe. If there is some disagreement,
there is a review for on-site.
Mr. Weller. Exactly.
Mr. Young. Okay. About how many acres of wetlands are left
in the pothole prairie region for review, do you know?
Mr. Weller. So--I don't know the acreage, but in terms of
the backlog, across all four states is a backlog, currently, as
of January this year, 4,600 determinations backlog. But to put
that in perspective, we have done over 50,000 determinations in
the last 4 years. So there is a lot of folks coming in, and we
have been keeping up with that, plus getting rid of the
backlog. So we have a plan now to get rid of that backlog
within the next two years.
Mr. Young. Thank you, gentlemen. Mr. Chairman.
Mr. Aderholt. Okay. We have been summoned for a vote, and I
am not sure how long we will be over there. So what I would
like to do is just open it up. Does any Member have another
question they would like to ask Chief Weller before we adjourn?
[No response.]
Mr. Aderholt. So--okay, good. Well, thank you for being
here, and we appreciate your assistance and work that you do.
And we look forward to following up with you.
We may have some questions that we will submit for the
record. But, anyway, we appreciate your presence here. Thanks
very much.
Mr. Weller. Thank you, sir.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Tuesday, March 3, 2015.
DEPARTMENT OF AGRICULTURE MARKETING AND REGULATORY PROGRAMS
WITNESSES
ED AVALOS, UNDER SECRETARY, MARKETING AND REGULATORY PROGRAMS,
DEPARTMENT OF AGRICULTURE
KEVIN SHEA, ADMINISTRATOR, ANIMAL AND PLANT HEALTH INSPECTION SERVICE,
DEPARTMENT OF AGRICULTURE
ANNE ALONZO, ADMINISTRATOR, AGRICULTURAL MARKETING SERVICE, DEPARTMENT
OF AGRICULTURE
LARRY MITCHELL, ADMINISTRATOR, GRAIN INSPECTION, PACKERS AND STOCKYARDS
ADMINISTRATION, DEPARTMENT OF AGRICULTURE
MICHAEL YOUNG, BUDGET OFFICER, U.S. DEPARTMENT OF AGRICULTURE
Introduction of Witnesses
Mr. Aderholt. The Subcommittee will come to order. Good
afternoon. I want to welcome everybody here. I was mentioning
to somebody earlier, you all bear with me. I have got a little
bit of a sore throat, so you all have to be patient with me
this afternoon with that.
But I am pleased to begin our review of fiscal year 2016
budget requests for the agencies of USDA's Marketing and
Regulatory Program mission area. I would like to welcome to the
Subcommittee Mr. Ed Avalos, USDA's Under Secretary for
Marketing and Regulatory Programs. Good to have you.
We also are joined today by Mr. Kevin Shea, Administrator
of the Animal and Plant Health Inspection Service. Good to have
you here. Ms. Anne Alonzo, Administrator of the Agricultural
Marketing Service; Mr. Larry Mitchell, Administrator of the
Grain Inspection, Packers and Stockyards Administration; and
also welcome back Mr. Mike Young, USDA's Budget Director. So
all of you, we welcome you here and glad to have you here this
afternoon.
Opening Statement--Mr. Aderholt
I have been emphasizing in previous hearings three goals of
this Subcommittee as we move forward. First is improving the
management of the agencies and programs under our purview, we
will be enhancing accountability and spending of taxpayer
dollars through improved agency governance process and internal
controls, and ensuring transparent decisionmaking.
Inspector General Fong testified a few weeks ago before
this Subcommittee. She cited a lack of sufficient management
controls to ensure that APHIS' pre-clearance offshore program
was operating effectively. This program helps protect U.S.
agriculture from foreign pests and disease, and it is
imperative that you address the report recommendations.
The second goal is to target funds to the most important
programs and their functions. Likewise, we must continue to
reduce or eliminate funding for lower priorities and those
programs that are less effective or duplicative. This mission
area has a broad spectrum of responsibilities that directly
impact our domestic and international agricultural products and
markets, and we will continue to support them.
However, you are requesting additional funds for several
initiatives that may be to the detriment of critical and
successful programs. For example, in your mission area I think
there is a missing component, such as a long-term strategic
infrastructure plan, that is crucial to moving products
domestically in order to expand trade and marketing
opportunities. USDA has been reacting to market disruptions
like those at the ports and railways instead of having a
proactive plan in place.
And the third goal is to promote U.S. agriculture, free and
fair markets, and safe food. Your mission area facilitates the
marketing of agricultural products domestically and around the
world, it works to remove non-tariff barriers in trade, and to
open, retain, and expand export markets, and also addresses
agricultural threats to safeguard animal and plant health. We
provided additional funding to APHIS in recent years to address
significant agricultural threats. We are appreciative of your
work with the private sector to address citrus greening and
emerging swine health issues.
I am also pleased the Department acted quickly to follow
the Congressional direction rescinding the provisions regarding
certain GIPSA regulations, as outlined in Section 731 of the
fiscal year 2015 Omnibus, and halting activities to establish a
duplicative and second beef checkoff program, as directed in
the Omnibus explanatory statement.
USDA is requesting a total of $987 million in discretionary
resources in fiscal year 2016 for the mission area, and that is
a decrease of $12.5 million from the 2015 enacted level.
However, all these agencies are requesting increases for
enhancing current activities or supporting new initiatives.
I will be looking for evidence that current efforts are
effective, and I would like to know what industry and public
support exists for these expanded efforts. I am particularly
concerned that USDA has requested scarce discretionary
resources for lower priority programs.
For example, APHIS has requested an increase to enhance
implementation of Lacey Act provisions. I have trouble
supporting such an increase at the expense of higher priority
and more effective animal and plant health programs, many of
which the agency has proposed to decrease.
With the overall spending caps still in effect, I
anticipate that this Subcommittee's funding levels will remain
relatively flat at best. We have tough allocation decisions
that are before us, and I want to be sure that we maintain
funding for the most critical and the most successful programs.
Today and in the coming months, we expect to have an
ongoing dialogue with your agencies as we develop a fair and
responsible budget for the next fiscal year.
So again, thank you each for being here. I would now like
to ask our distinguished Ranking Member, Mr. Farr, for any
opening statements that he may have.
Mr. Farr. Mr. Chairman, I have no opening statement. I am
so excited listening to this distinguished, intelligent panel
that let's just get on with the hearing.
Mr. Aderholt. Very good. Thank you, Mr. Farr.
Also, before I get started, let me just take time to
recognize Karen Ratzow. She has been on detail with our office,
with the Subcommittee office, from the APHIS budget office, and
she has been a very valuable member to the Subcommittee over
the past year.
She is very diligent. She has a tremendous work ethic, is
very knowledgeable in the budget process, always eager to
volunteer and always to lend a hand wherever she can. She
quickly became a part of this team from very early on when she
came here, and while her detail is slowly coming to an end, we
do want to thank her for her service and look forward to
working with her as she returns to APHIS. So I just wanted to
mention that. Thank you.
At this time, Mr. Under Secretary , I will give you the
floor and let you speak as you would like as your prepared
remarks.
Opening Statement--Mr. Avalos
Mr. Avalos. Thank you, Mr. Chairman.
Distinguished members of the Subcommittee, before we get
into the budget request, I would like to offer my condolences
on the passing of Congressman Nunnelee. I vividly remember one
exchange that the honorable Congressman and I had. We were
discussing the Specialty Crops Grant Program and the different
State marketing slogans we used to identify specific products
and specific States.
I mentioned using New Mexico: Taste the Tradition, when I
was in charge of marketing at New Mexico Department of
Agriculture--I told him his State slogan was unique and one of
my favorites. He admitted that he did not know what it was, but
when I told him that it was, ``Make Mine Mississippi,'' I saw a
smile and look of pride in his face. He will be missed.
Mr. Aderholt. Thank you.
Mr. Avalos. I appear before you to discuss the activities
of the Marketing and Regulatory Programs mission area at USDA
and to present the fiscal year 2016 budget proposals for AMS,
APHIS, and GIPSA. With me today are Ms. Anne Alonzo, Mr. Kevin
Shea, and Mr. Larry Mitchell. They have statements for the
record, and they will answer questions regarding specific
budget proposals in their agencies. Also with me is Mr. Michael
Young, USDA budget officer.
The MRP agencies have achieved significant accomplishments
recently. I will talk about a few today, and I have additional
accomplishments in my written statement.
In fiscal year 2014 APHIS, in cooperation with other
agencies, successfully negotiated and resolved 170 sanitary and
vital sanitary trade issues with an estimated value of $2.5
billion. This includes opening new markets as well as retaining
and expanding existing market access for U.S. agricultural
products.
To illustrate the impact of APHIS' efforts to open markets,
I will highlight the agreement recently reached with China to
allow U.S.-grown apples into the Chinese market. With this new
agreement, the apple industry estimates exports will reach
nearly $100 million.
AMS also has a role in promoting trade and opening new
markets. In July 2014, the U.S. and Korea announced an organic
equivalency agreement that should create market access for a
market that is valued at over $35 million a year.
In fiscal year 2014, GIPSA provided over 3.3 million
inspections on grain, with a value of over $45 billion. GIPSA
has succeeded in making these inspections affordable. Export
services' fees are about a penny per bushel. Further, the sheer
volume of grain that GIPSA inspectors evaluate on a daily basis
is absolutely astounding. GIPSA inspects, on the average, the
equivalent of more than 380,000 acres of wheat. That is every
day.
Next I will present a select number of requests for
increases in our 2016 APHIS budget. As part of the government-
wide initiative to address antimicrobial resistance, we are
requesting $10 million to increase our surveillance efforts to
antimicrobial-resistant bacteria.
The budget also includes an increase to address the threat
of citrus greening. This work continues the efforts that were
initiated by this Subcommittee's direction to establish a
multi-agency response.
The budget also includes an increase to combat illegal
logging. This increase is consistent with our goal today to
balance the need to enforce the 2008 amendments to the Lacey
Act with the need to facilitate legitimate trade.
For AMS programs, additional funding is requested to work
with Federal, State, and local stakeholders to access regional
food systems and determine key characteristics that will help
food system developers, investors, and State and local
governments better understand the challenges and opportunities
for growth in their local food systems.
For GIPSA, the budget includes a modest increase in
existing restrictions on user fee expenditures to a maximum of
$55 million for grain inspection and weighing. This adjustment
to the obligation cap will allow GIPSA to keep pace for overall
increases in volume of trade as well as to be present in new
export facilities as they come online.
Mr. Chairman, this concludes my statement. I look forward
to working with the Subcommittee on our fiscal year 2016
budget. And we are happy to answer any questions.
[The information follows:]
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AGRICULTURAL QUARANTINE INSPECTION PRECLEARANCE PROGRAM
Mr. Aderholt. Thank you for your testimony. As I had
mentioned in my opening statement, the Inspector General
testified before this Subcommittee a couple weeks ago, and she
testified and included a summary of findings from a recent
report on APHIS' pre-clearance offshore program.
She mentioned that the agency did not have sufficient
management controls in place to effectively protect the United
States from the introduction of devastating foreign
agricultural pests and disease. The findings included several
management issues such as lack of oversight from top-level
officials, inspection reports that were being generated but not
read, and there were no consequences for repeated
noncompliance.
These are, of course, as you would agree, serious
allegations when you consider that the program is designed to
protect the health of United States citizens from harmful
agriculture pests and disease. As you know, some of the pests
in the country now are costing us billions of dollars to
control and as we attempt to eradicate them.
It is my understanding that 14 out of the 16
recommendations have been resolved. Can you talk about and
summarize APHIS' actions that they have taken to address these
findings and these recommendations?
Mr. Avalos. Mr. Chairman, first I just want to state that
we take our mandate to protect animal and plant health in this
country very seriously. I am going to ask our administrator at
APHIS, Mr. Kevin Shea, to answer your question.
Mr. Shea. Thank you, Mr. Avalos.
Mr. Chairman, we certainly take that very, very seriously,
and I think we did take some solace in that there was no
indication that any pest or disease occurrence happened because
of any deficiency in our systems. The main things that we
learned from the Office of Inspector General (OIG), and we very
much appreciate their recommendations, is that we lacked really
systemic methods of overseeing the program.
Those are all in place now. You mentioned, for example,
lack of oversight of reports by high-level officials. We have a
complete system in place now to ensure that does not happen
again. We will complete not only the 14 you mentioned, but the
other two as well by the time this fiscal year is over, and we
are certainly dedicated to making sure that happens.
Mr. Aderholt. Talk about some of the controls that you have
in place to assure that these type of deficiencies will not
occur in the future.
Mr. Shea. Some of the things we have done: We have put in
place a system of processes, a checklist, if you will, that
will tell the inspectors what forms to fill out, what reports
to file. That same system will apply to their supervisors so
they can review things at a particular time.
I think that was what we lacked. I think some of the things
took place. I think some of the reviews took place, but it was
not systematic. And that is what we now have, standard
operating procedures that will apply to all aspects of the pre-
clearance program.
BIOTECHNOLOGY REGULATORY SERVICES--PETITION REVIEWS
Mr. Aderholt. APHIS has been improving the biotechnology
petition review process for a couple of years. Last year you
reported that you were only able to reduce the backlog of 22
petitions by six. Your testimony this year states that you are
nearly through the list of backlogged petitions. Can you
provide us more details on the status of the backlog and what
progress you have been able to achieve?
Mr. Avalos. Mr. Chairman, under the direction of Mr. Shea,
APHIS has done a fantastic job in reducing the backlog. They
have really cut down on the time frame it takes to deregulate a
specific product. So I am going to ask Mr. Shea to go ahead and
expand on the answer.
Mr. Shea. Mr. Chairman, I recall a year ago I pledged to
you we would cut the backlog of 16 by at least half, and I am
proud to say that the fantastic men and women who work in our
biotechnology review program have indeed exceeded that goal and
there are now only six of those 16 remaining. So that means we
reduced it by more than half.
I would say this also. When we began our business process
improvement just a few years ago in 2012, there were 23
deregulation requests in the backlog. Since then, 11 more
requests have come in, so there were a total of 34 regulation
requests. There are only six left. We got 28 out of 34 done.
There are only six remaining. We are going to get those done,
we think, by the end of this fiscal year.
And so now we have the system in equilibrium. We can handle
the amount that comes in. And not only can we handle them, we
can handle them quicker. It was taking us three to five years
to do these things. We are now down to 15 to 18 months. Our
goal is no more than 15 months, and I think we are going to
achieve that as well. So I am very proud of our progress there.
Mr. Aderholt. So when do you think you will be caught up
with no longer having a backlog?
Mr. Shea. I do not think we will have any in a backlog, so
to speak, at the end of this fiscal year. We would hope to have
all of the 34 that were either in place in 2012 or have come
into the system since then--we would expect to have most of
them done and then be in an equilibrium where we can move out
the same number that comes in over the course of 15 to 18
months.
Mr. Aderholt. Mr. Farr.
PLANT PESTS AND DISEASE SURVEILLANCE
Mr. Farr. Thank you very much, Mr. Chairman.
First of all, I would just like to introduce to the
audience--California is our leading agriculture State--it is
our number one industry in California. And I forget how many
billions of dollars it is, but in my county alone, in one of my
counties, Monterey County, which is the second in the nation,
ag production is at $4.8 billion.
And the head of that, the ag commissioner, Eric Lauritzen,
he is here today. I just want to thank him for coming to our
hearing because he is bringing a lot of ag commissioners.
California has an ag commissioner in every county, 58 counties,
and those commissioners have all the responsibility for
enforcing the pesticide laws, the weights and measure laws, the
consumer laws, also doing all the economic data--just about
everything you have to do with agriculture.
And what I am worried about--we are hearing about all
this--we just had the Prime Minister of Israel talking to us
about the fears of the Middle East. What we are worried about
is the attack that is going on in California with invasive
species.
We have spent all our money on cyber-security and things
like that, very little on invasive species, and yet California
has the largest ports in the United States in Long Beach and
L.A. It has a border with more people living on the other side
in Mexico than any other State. It has dozens of international
airports, and 36 million people who move around a lot. So
invasive species is huge, and pest detection activities are
critical if they are targeted.
I really want to ask Kevin Shea, in the recent past you
have only committed $27 million for the entire United States,
for 50 States--that is less than a half a million dollars per
State--for your pest detection line item. Is that enough?
Mr. Shea. Mr. Congressman, I would say that we have $27
million dedicated to general plant pest and disease
surveillance. But we have a lot more money in individual pest
disease programs that have surveillance. For example, we spend
millions of dollars simply on fruit fly surveillance every
year. That is just one example.
Mr. Farr. But do we have enough money to bolster our system
to protect agriculture and to therefore have to minimize
eradication, like the fruit fly that you are talking about?
That is a huge eradication program that has been going on for
25 years or longer.
Why is there a reduction in the specialty crop line item,
knowing that the continued pressure for invasive species is
going to hamper agriculture and impact our trade? The fresh
fruits and vegetables out of California are wanted all over the
world, and vice versa.
Mr. Shea. We think that the level of spending on those
programs is appropriate. What we think may not be appropriate
is the share of costs between the Federal Government and the
State governments. And that is what we are proposing here, is
to shift some of those costs from the Federal Government and
our declining appropriation to State governments.
LIGHT BROWN APPLE MOTH
Mr. Farr. Well, I am all for that. But I think you cannot
abandon your leadership role, particularly on the light brown
apple moth. As you know, we have failed in the eradication, but
we are moving to control and contain through the protocols. We
do not want that dropped and left to the States, where
everybody then starts a crazy war in this country of State
against State.
So I think it is important that you maintain your attention
and bring resources to that. Can you commit that that is what
you do to continue your effort in that regard?
Mr. Shea. We are certainly committed to carrying out the
light brown apple moth regulatory program, which has enabled
tens of millions if not hundreds of millions of dollars' worth
of product to move out of California, and particularly into
Canada and Mexico and other parts of the United States. We are
certainly committed to the----
Mr. Farr. Well, there is a program where the industry puts
up a lot of dough because they have got to go through all the
protocols to make sure that they get the clearances. We just
want you to make sure that you are involved in holding us to
those protocols, and having money to do it.
The other thing I would hope that you will do with these
States is that I think we do this poorly throughout government.
Some States just do not want to tax. They do not want to spend
any money. Well, we ought not to give them money. If you are
going to come in and get grants around here, the first thing
that is asked is, how much money have you got in the game?
We ought to be asking States, how much money have you got
in the game to help solve this problem? And if they are not
putting any money in it, we ought to put them at the end of
this list. Help those who help themselves. That is a good
Republican motto.
I want to ask a question of Anne Alonzo, because you went
to my district, and I loved your visit and I think you loved
our district. It was really a love fest. [Laughter.]
ORGANIC AQUACULTURE
Because you saw all the organic that we are doing and the
ability to expand that market. So I am asking, when can we
expect to see the rule clear USDA and OMB, and what are the
timelines for the organic aquaculture rule?
Ms. Alonzo. Thank you, Congressman.
Mr. Farr. People want to grow fish and shellfish
organically as well.
Ms. Alonzo. We know the proposed rule is important to you.
It is important to us. It is in departmental clearance, and we
are expediting it. We hope to have the rule out of the
Department in the next few months. From the Department it will
go to OMB because it is economically significant. We figure it
will be about there 90 days. And it took time. Some of the--
sorry.
Mr. Farr. What is the bottom line about the rule. When do
you think it is going to be out there?
Ms. Alonzo. This year.
Mr. Farr. This year?
Ms. Alonzo. Yes. This year.
Mr. Farr. Summer? Fall? Winter?
Ms. Alonzo. We would hope that it would be out by May or
June from the Department.
Mr. Farr. Thank you.
Mr. Aderholt. Mr. Rooney.
CITRUS GREENING
Mr. Rooney. Thank you, Mr. Chairman.
I wanted to talk about--I come from one of the largest
citrus-producing districts, I think, in the Congress, if not
the largest. And obviously, citrus funding is of utmost
importance to my growers. So I wanted to talk first, if I
could, about the citrus funding in the Multi-Agency
Coordination (MAC) for the fiscal year 2016 budget. As you
know, it provides an additional $7.5 million increase for the
Huang-longbing (HLB) MAC.
If you could for the Committee, could you go into more
specifics about the USDA's plan for these additional resources?
Like will this be for new research or existing programs or
both? And if it is just existing, are you able to target that
existing funding in a way that still gets at the critical
needs?
Mr. Avalos. Congressman, I am going to ask Mr. Shea to
answer the question. But before I do that, I just wanted to
emphasize that we understand how devastating this disease--
citrus greening--has been to the industry. And I want to assure
you that we are doing everything we can to put tools in the
hands of the growers so they can continue to be productive. We
get it, and we are on board to support.
I want to thank the Committee for the $20 million that was
put in for a MAC group. I think that money is put to good use.
We look for practical solutions, practical tools, that we can
use today to help our growers.
So anyway, I just wanted to----
Mr. Rooney. Well, just if I could before you give the
answer, I echo that and I thank you for saying that because it
is a critical time. Driving around my district in the counties
that I have and talking to the growers there, they do feel like
we are at that moment of truth where they are either going to
encourage their kids to get involved in this business or they
are not.
And I hear that more and more. And it is pretty depressing.
But they are encouraged by what we are both doing, and so I
think that that is why it is important that we reiterate and
answer this question and encourage those growers that there is
hope.
Mr. Avalos. Absolutely, Congressman. And I did spend some
time in your State and I did meet with quite a few of your
growers. And we are committed to support the industry.
Mr. Rooney. Thank you. Thank you, sir.
Mr. Avalos. I am going to pass it on over to Mr. Shea.
Mr. Shea. As the Under Secretary said, we are trying to
focus the $20 million you generously provided to us last year
and the $7.5 million we are proposing for 2016 on quick-hitting
things that can help citrus growers in Florida, California, and
Texas right away.
We need to be able to have quick detection, we have to have
citrus groves stay sustainable once they do incur some
infection, we need to have therapies, and we need to have more
vector control. So there are some things we are doing for that,
really interesting things. And we are providing money to
universities, private companies, all who come up with good
ideas to try.
For example, detection: We are learning that dogs can
detect the disease, and so we can identify the disease faster
than with visual survey. So that is one thing we are doing.
Sustainability, several things we are trying to do there.
One is, as I am sure you are well aware, there are abandoned
citrus groves in Florida and they become reservoirs of
infection and of the vector. And so we are providing money, in
connection with Commissioner Putnam in Florida, helping to
clear those fields or those groves and to have those not become
reservoirs. So managing those groves is important.
We are trying therapies that can help trees maintain their
useful life. One that seems to be really promising is thermo-
therapy. Indeed, using the good Florida sun, heating the trees
to a certain degree, can reduce the infection load. And one of
the allocations currently that we have is for a company to
figure out how to cover 150 trees at a time because, obviously,
one tree at a time will not help. So that is something we are
funding this year. There is half a million dollars' worth of
work on that.
And we are funding more work on antimicrobials, and more
funding to release more parasitoids and other enemies of the
Asian citrus psyllid that carries the disease. So we are doing
lots of these things that we hope will buy time while some of
the longer-term research, funded through the Farm Bill, will
come through.
Mr. Rooney. Thank you. And I will come back if--are we
going to do another round or should I try to ask another
question real quick?
Mr. Aderholt. Since your time has expired----
Mr. Rooney. Yes. Okay. I yield back. Thank you very much.
Mr. Aderholt. We will try to do another round. We are
uncertain about the floor schedule, but we will proceed on as
best we can.
Ms. Pingree.
ORGANIC CHECKOFF
Ms. Pingree. Thank you, Mr. Chair. Thank you all for being
here today and for your work on behalf of the farmers across
the country and the consumers as well.
I am going to ask a question of Administrator Alonzo about
the organic checkoff and some of the organic things. I know you
are very focused on the growth of the organic sector, and
certainly understand that for a State like Maine, as part of
the ability for agriculture to come back as an important part
of our economic growth, the organic sector has provided a
really important market.
But I want to talk to you a little bit about the checkoff
program. The Farm Bill included language that would exempt
organic producers from paying into commodity checkoff programs,
so that was a positive way to move forward.
But the next proposal being considered is the creation of
the checkoff program for the organic industry. Farmers and
processors with a certain level of income would pay into the
program, which USDA oversees but does not fund, and then that
money, as you know, goes on to fund research, marketing,
promotion campaigns, a lot of very good things to help people
understand the organic sector better and for this to strengthen
the sector.
I just want to weigh in on the importance of making sure
that this checkoff represents all farmers, from those farmers
with a few acres, which are a very important part of this
growing industry, to the giants that are out there really doing
great work in feeding people organic food.
So I think my question is, if the proposal exempts the
smaller farmers from an assessment and from voting in the
program, how do we make sure that those voices are included in
the decisions that are going to be made, given the fact that
there are more certified organic farmers in the small to
medium-sized group, but some of them will not be included in
this? And just in the discussion of this, what is the timeline
for moving forward on this? You get my questions?
Ms. Alonzo. Thank you, Congresswoman. First of all, all
organic producers are important to us, small and large. And
over the past year we have met with multiple groups about the
Farm Bill authorization for the checkoff. No single group has
control of this process.
In terms of how the process works, the organic industry
initiates it by filing a proposal with AMS, and the proposal
must also indicate industry support for the proposal. We do not
have a proposal yet so it is kind of difficult to talk about
particulars.
But in fact, any group is able to submit a separate order
or submit a partial order or comment on the proposal that we do
receive throughout the process. So there are many opportunities
for everybody's to input. But before any of this becomes final,
there will be a referendum vote and eligible voters will be
able to vote.
And so I just wanted to assure you that we are hearing all
voices large and small, and there is ample opportunity for
public input in this process.
Ms. Pingree. Great. Well, thank you for your reassurance.
It is certainly critically important.
And I yield back.
Mr. Aderholt. Dr. Harris.
HIGHLY PATHOGENIC AVIAN INFLUENZA
Dr. Harris. Thank you very much.
Let me start just by asking a couple of questions about the
Avian Influenza virus because I have poultry in my district and
am worried about that. Are there other actions that could have
been taken by your agency or need to be taken with regards to
the Avian Influenza at this point? And do you have the proper
funding in this year's budget to do those actions?
Mr. Avalos. Congressman, first I want to emphasize that at
USDA at APHIS, we are committed to protecting the U.S. poultry
industry from high-path avian influenza. We have a very good
working relationship with our State partners, a very good
relationship with the stakeholders, with the industry, and we
have the best surveillance program in the world.
Now, what has happened, when we had our two detections in
California, several countries, they did not follow
international guidelines. The World Organization for Animal
Health (OIE) established these criteria as to how you restrict
should an outbreak come out, and they encourage that you only
restrict an area or a region or a State.
Several of our trading partners did not do that. And so I
just want to assure you, Congressman, that from Secretary
Vilsack on down, we are communicating with our trading partners
and working to get them in line with OIE guidelines.
AQI USER FEE INCREASES
Dr. Harris. Well, thank you. Now, with regards to the
agricultural quarantine and inspection user fees, my
understanding is that USDA has proposed significant changes
both to user fees and the overtime reimbursement rates. But we
had language in the 2015 Omnibus, I think, that required you to
take into account stakeholders' opinions before issuing the
rule.
Apparently the webinar was held on January 13 with the
stakeholders, the final rule submitted to OMB on January 16.
Now, you either did some pretty quick drafting in those three
days or it appears that it was just a check-off-the-box
action--yes, we have to talk to the stakeholders, so we will
wait three days and publish the rule or submit the rule.
Were there significant changes made taking stakeholders'
opinions into account?
Mr. Avalos. Congressman, I am going to ask Kevin Shea to
answer your question. But before I do that, I just wanted to
emphasize that Mr. Shea and his team at APHIS have put a lot of
effort into this user fee. For the longest time, it has been on
their agenda. So I know that it has not been something that
they just did quickly. They have spent a lot of effort on
developing an AQI user fee rule.
So anyway, I will ask Mr. Shea to answer your question.
Mr. Shea. Prior to the webinar you mentioned, we had had
five or six public meetings or webinars before that. We had an
open comment period, which was extended, as well. So many of
the things we heard on January 13 were the same things we had
heard in many of those other webinars.
We were already prepared to make some adjustments in the
initial proposal based on that feedback. And I think whenever
we do publish a final rule, you will see that that feedback was
addressed. But what we heard that day was the same thing
generally that we have been hearing pretty much at all the
other times.
Mr. Harris. And when you took into account--because not
only the service fees went up but the overtime reimbursement
rates. And when you analyzed the impact on your stakeholders,
was it just for each one individually or the fact that they
could get hit with increases in both of them?
Mr. Shea. We looked at those both in tandem. For example,
there is one fee that has been very controversial--about a fee
to oversee treatment, for example cold treatment or fumigation.
And we were able to take that in tandem with the overtime rule
as well to make some adjustments. So we definitely took them
both into consideration in tandem.
FOOT AND MOUTH DISEASE VACCINE
Dr. Harris. And just the last thing I am going to ask about
is the foot-and-mouth disease vaccine. I know some of the
livestock producers are concerned that although it is not a
problem in the country now, that it could be at some point. And
the way we do it is I understand we have the antigen here, but
we send it to Europe to produce a vaccine. It seems a little
cumbersome.
Do we have the ability, given that system, to address an
outbreak of foot-and-mouth disease in the United States? Do we
have adequate resources? Do we have an adequate amount of the
vaccine?
Mr. Shea. Our first response to any foot-and-mouth disease
occurrence in this country would be to try to stamp it out
without vaccination. We have good surveillance systems in
place. I think we would find the disease very quickly. And of
course, we are lucky enough--we have not had it here in over 85
years; we hope we will never have it here--but we have good
surveillance that we think can find the disease quickly so that
stamping it out could work.
In the long run, vaccination is probably the way we should
go. That is the way the rest of the world operates now with
foot-and-mouth disease. To have an adequate amount of vaccine
would be enormously expensive, and the amount of vaccine we
have now certainly would not allow us to enter into a
vaccination-only approach to a foot-and-mouth disease
incursion.
So I think it is really vital that we work with our
industry stakeholders and others in trying to find a financial
system to support a larger vaccine bank.
Dr. Harris. Thank you very much. I yield back.
Mr. Aderholt. Mr. Bishop.
SHELL EGG SURVEILLANCE PROGRAM
Mr. Bishop. Thank you very much. I apologize for my
delinquency. I had a conflict with another Subcommittee. But
let me go to reductions in the shell egg surveillance program.
According to your budget justification, the shell egg
surveillance program inspects registered shell egg facilities
and monitors the disposition of restricted eggs to limit the
number of restricted eggs that get into consumer channels.
Stoppages in the program could disrupt markets for the product
and it could endanger customer health.
So I find it a little bit curious that the Administration's
budget proposal is to cut the program's budget by 17 percent
and, more importantly, reduce the staff of the program by half.
Packing plants in the past have gone through inspections at
least four times annually and hatcheries once a year. Will you
continue to be able to conduct these inspections at the
frequency that they have occurred in the past, and in fact, are
four annual inspections actually frequent enough?
Inedible eggs are a small proportion of all shell eggs and
they are typically destroyed, but a significant number is used
for animal feed. Can you tell me how you are going to be able
to do that? In other words, you have got to do more with less.
Mr. Avalos. Congressman, Administrator Alonzo is going to
answer the question for you. Administrator Alonzo will answer
the question.
Ms. Alonzo. Thank you, Congressman. Yes, we are requesting
a decrease of $444,000 for two reasons. One is industry
consolidation, which has reduced the number of facilities that
need inspection. There has been a 28 percent decrease from 2000
to 2013, so we have fewer facilities to inspect.
Number two, we have better compliance. The number of
compliance actions resulting from inspection has decreased by
almost 70 percent in this same time frame. So less facilities,
better compliance, and our service is not going to suffer.
We have scheduled visits to these shell egg handlers. It is
going to remain the same, four times per year, and annual
visits to hatcheries. So we feel good about this decrease.
Mr. Bishop. Thank you. Thank you for clarifying that.
I think all of us have been concerned with the ongoing
situation in Ukraine, and in particular, Russia's annexation of
Crimea. As you know, APHIS began a new initiative to open and
expand markets to Belarus, Kazakhstan, and Russia for U.S. day-
old chicks and hatching eggs, which was a very significant
development for our poultry exporters here in the U.S.
Can you give us an update on the status of our export
activity in the region and whether or not the conflict in the
region has had an impact on our agreements with the nations
involved?
Mr. Avalos. Congressman, we are going to have to get back
to you on that question.
[The information follows:]
Day-Old Chicks and Hatching Eggs Exports to Russia, Belarus, and
Kazakhstan
APHIS has agreed to conditions for the export of day-old chicks and
hatching eggs to the Russian Federation, Belarus, and Kazakhstan. The
recent outbreaks of highly pathogenic avian influenza (HPAI) in the
United States have impacted the existing conditions, with these
countries now prohibiting the import of day-old chicks and hatching
eggs from regions where HPAI outbreaks have been identified.
GENETICALLY MODIFIED ORGANISMS
Mr. Bishop. All right. I still have some time. Let me ask
you about the genetically modified organisms (GMOs). The APHIS
enforcement program is designed to promote the integrity of the
APHIS program for providing effective investigative and
enforcement services. This funds biotechnology and regulatory
services activities, which support the Department's strategic
goal of helping to promote ag production and biotechnology
experts by deregulating biotechnology products that are found
safe for agriculture.
In addition to the COOL debate, there continues to be
considerable attention given to the issue of genetically
modified organisms, GMOs. In both instances this has become a
major concern for many of my producers, not only on the animal
side but the fruit and vegetable side.
Can you give us an update of your activities related to
GMOs and whether the Department should be playing a greater
role if not the leadership role in making sure that the public
is made aware of all sides of the GMO issue, and in particular,
the extensive current use of modified seeds, such as Roundup-
ready seeds for cotton and peanuts, for a variety of
commodities, and the current research which is underway at our
major land grant universities, and the real plans to expand the
use of such research and technologies in other areas of the
food chain.
Mr. Avalos. Congressman, I am going to ask Administrator
Shea to answer part of that question, anyway.
Mr. Shea. Our role in regulating biotechnology or
genetically engineered products is simply to determine whether
or not a proposed product would be a plant pest or not. The
Environmental Protection Agency (EPA) has a role. The Food and
Drug Administration (FDA) has a role as well. We believe, as
Secretary Vilsack has emphasized since he took office, that
coexistence is so important; that there is room for genetically
engineered, conventional, and organic growers throughout the
country.
Just next week we are having a major conference in Raleigh,
North Carolina, bringing together all of those sectors to get
input about genetically engineered products and how they can
coexist. And all sectors will be there. And we think that is
part of our effort to do as you suggested, to communicate with
and help educate all aspects of American agriculture about what
we are doing.
Mr. Bishop. As you know, it is pretty controversial and it
is beginning to fuel a lot of debates across the consumer
market as well as the production markets. And of course, it
impacts us when we consider exporting also because some of the
European countries and other countries are very, very
particular about not having GMOs come into their food chain.
So are you the lead agency on it? Would you say that the
other agencies, EPA and FDA, are further ahead of you, or are
you working equally? Who is the lead agency?
Mr. Shea. We work equally. Since 1986, in fact, there has
been a consolidated framework for regulating genetically
engineered agriculture, and FDA, EPA, and USDA have worked
together equally over the entire almost 30 years now.
Mr. Bishop. I think my time has expired.
Mr. Aderholt. Mr. Young.
MARKET NEWS REPORT--NATIONAL HOG REPORT
Mr. Young of Iowa. Thank you, Mr. Chairman. And guests,
thank you for coming before us today. We have a vote here soon
so I am going to try to do this quickly.
Ms. Alonzo, independent pork producers in my district have
raised an issue regarding the national hog reports that are
prepared by the AMS. Smaller independent producers sell on the
prices based in your reports, and this has led to a very small
proportion of overall sales nationally dictating prices for
smaller producers, they believe.
There is some concern that the current reporting
methodology may not be offering the most fair price to farmers
and that there could be price manipulation taking place in the
market. Can you address those accusations and those fears that
are out there? They are real. I see you raising your eyebrows,
but I hear that in my district. Can you tell a little bit about
your methodology?
Ms. Alonzo. Well, you are referring to our Market News
reports. These are the reports that are unbiased, and they are
timely, and they are free for the public. And we issue hundreds
of them every day, a quarter of a million a year. A lot of use.
I am not familiar with what you are mentioning in terms of
the distortion, and we would be happy to go back and look at
that--unless, Under Secretary Avalos, do you want to speak to
that issue?
Mr. Avalos. Congressman, one thing I do want to mention is
we do have livestock mandatory reporting. And I think this is
very, very important to talk about because livestock mandatory
reporting, it does encourage competition in the marketplace. It
does create transparency. It does give us more quality price
and supply data. And I think this is very important to the
small producer.
I do want to mention that this authority expires this year,
and we do need support for reauthorization so we can maintain
this quality supply and price data.
[The information follows:]
Market News--National Hog Report
AMS Market News is aware of the concern that the daily hog market
can appear to be volatile because it is thinly traded with a limited
number of buyers and sellers participating in the negotiated hog
market. In an effort to normalize the reported market information, AMS
is developing a five-day rolling average of the daily negotiated hog
prices to be published in the current swine reports.
Mr. Young of Iowa. Thank you. When we have more time, maybe
we can have a meeting and follow up on this. But I appreciate
that.
Mr. Avalos. Absolutely, Congressman.
BIOTECHNOLOGY REGULATORY SERVICES--PETITION REVIEWS
Mr. Young of Iowa. Mr. Shea, in your testimony, you discuss
how USDA is making the approval process for biotechnology
products more efficient. Would you comment on the new process
specifics, how they are streamlining the biotech approval
process?
Mr. Shea. There are several things that we are doing, Mr.
Congressman. One is, it seems remarkably simple, but when we
reviewed the business process that we used for deregulation, we
saw how many different approval steps there were. And we simply
were able to reduce some of those, and also give people a
little less time to complete their part of the work. So that
was one piece of it.
A second piece is that we now publish an initial risk
assessment so the public can see, so we can get input from the
public very quickly and not drag out the process quite as long.
We get a lot of input right up front with our initial risk
assessment on any deregulation. So that is another thing we
have done.
Also, I would be remiss if I did not say the Committee has
provided more funding for that item over the last several
years. And that has allowed us to have more scientists on board
to review the petitions, do the analysis. As Congressman Bishop
pointed out, these are highly controversial things. We need to
make sure we get it right because we do end up in the courts on
many of these cases.
Mr. Young of Iowa. Well, thank you. And I do have some
questions for the record I will submit--we are short on time--
if that is okay, Mr. Chairman.
Mr. Aderholt. That is fine.
Mr. Young of Iowa. Thank you folks for your time.
COUNTRY OF ORIGIN LABELING
Mr. Aderholt. Let me turn back to talk a little bit more
about COOL. The fiscal year 2015 Omnibus directs the Secretary
to work with the U.S. Trade Representative and to submit to
this Committee a report with legislative language that would
establish the country of origin labeling program for beef,
pork, and poultry, which you know. And the report is due May 1.
I asked the Secretary when he was here a week or so ago
about this. My question to you is can we have your assurance,
Mr. Under Secretary , that we will receive that report by May
1?
Mr. Avalos. Mr. Chairman, at USDA we stand ready to work
with Congress on the next steps of addressing COOL.
Mr. Aderholt. But do you all think that you all will have
something to come back to Congress by May 1?
Mr. Avalos. Mr. Chairman, I guess my answer to you would be
that the request we take serious. And right now we do not have
a regulatory fix, as the Secretary mentioned, and Congress
really needs to amend the statute in order to move forward
should we lose that appeal. So I can just tell you that we have
taken the request seriously and that we stand ready to work
with you to move forward.
Mr. Aderholt. Well, if the U.S. does not win an appeal at
the WTO, meaning, of course, industries will face retaliation,
what commodities and industries are being targeted by Canada
and Mexico for retaliation, and how much do you estimate that
these various sectors will have to pay in tariffs?
Mr. Avalos. Mr. Chairman, I do not have that information.
That would probably be a question for USTR.
Mr. Aderholt. Anybody have any more comment on that at all?
[No response.]
[The information from USDA follows:]
Country of Origin Labeling
AMS is not aware of any official list of industries or commodities
that would be subject to retaliation by Canada or Mexico, provided we
lose the appeal. Should the WTO Appellate Body rule against the United
States in the appeal of the COOL case, Canada and Mexico would have the
right to request authorization from the WTO's Dispute Settlement Body
(DSB) to suspend trade concessions. At that time, Canada and Mexico
would inform the DSB and the United States of both the total level of
retaliation proposed and the commodities for which Canada or Mexico
seek to suspend concessions. The United States would have the
opportunity at that time to object to the level of suspension proposed,
in which case the matter would be referred to binding arbitration
before a WTO Panel.
-Mr. Aderholt. Okay. Excuse me just a second. [Pause]
TRANSPORTATION INFRASTRUCTURE
We have got a vote going on, so we are just trying to
monitor to make sure we can keep this going forward while we
are voting at the same time.
The United States has seen record levels of agricultural
exports for the past few years. Your mission area has a large
focus on trade and marketing opportunities for all agricultural
products and plays a key role in that outcome. However, it
seems that the focus on increased trade opportunities without
consideration for infrastructure to adequately support it can
be a little bit short-sighted. The rail situation and the
disruptions at our ports are recent examples that USDA is
reacting to the domestic international commerce circumstances
instead of providing a proactive plan to move forward.
With the latest budget request, there is a continued
emphasis on expanded trade and marketing opportunities.
However, the concern is that we do not have the infrastructure
fully in place to support them. Having the goods available but
not being able to deliver them just do not really seem to make
a lot of sense, and it is a little disconcerting to see the
Department's lack of a comprehensive vision in long-term
planning to ensure the infrastructure is solid and to make sure
that you are expanding these efforts.
Can you provide us some particular examples of how the
Department is looking at all aspects of transportation
infrastructure to see how a comprehensive solution will benefit
America's producers?
Mr. Avalos. Mr. Chairman, I can comment just briefly on
rail transportation. In my mission area at USDA, we do not have
jurisdiction over transportation per se. However, we do have a
component of AMS that looks at rail transportation from the
perspective of agriculture. And we do testify in front of the
Surface Transportation Board and we make recommendations on
behalf of agriculture.
Mr. Aderholt. I realize the Department has focused heavily
on local and regional markets. But I would ask you commit today
to providing the Committee with a long-term infrastructure plan
that benefits all producers and not just those that market
their products locally, and you give us that assurance that you
will do that.
Mr. Avalos. Oh, absolutely. At USDA our focus is on all
components of agriculture, and local and regional just happens
to be one component.
[The information follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Aderholt. We are going to have to go into recess for
just a minute for us to go cast our vote. And so we will
reconvene probably in about 15 minutes. So we will just adjourn
for 15 minutes.
[Recess.]
We will try to get back on track. Thank you all for your
patience on the vote.
I would like to now go to Mr. Farr.
RETAIL PET STORE RULE
Mr. Farr. Well, thank you very much, Mr. Chairman. I am
sorry Mr. Rooney is not here. He mentioned about kids not
wanting to take over their parents' farms because they think it
is a losing proposition.
What I love about this Committee and the U.S. Department of
Agriculture essentially is it is the rural America department
that really handles the infrastructure of rural America. I hope
that we will realize that if indeed rural America, as the
Secretary indicated not this year but last year in his opening
remarks, has not been in a recession; it has been in a
depression.
But when you think about the infrastructure, of trying to
WiFi it and bring broadband in, that is under the jurisdiction
of this Committee. When you think about the fact that what we
are talking about here today is to sustain the health and
safety of plants and animals, and I would say to Mr. Rooney,
one of the things we need to do is we also need to realize that
you cannot start a business in agriculture without millions of
dollars in agricultural areas like my district.
But the exception to that is these really small growers,
starting off just going to farmers markets and doing organic
where they do not have the cost of inputs. The bigger growers
are having a big problem because it costs about $35,000 an acre
to plant an acre of strawberries. Now, the pickers will get $19
an hour. That is higher than Costco's wages. And you cannot
find the farmworkers.
So we have a huge labor shortage, which is, I think, why we
need the Ags jobs bill. But anyway, that is just one of my
lectures, that I think that this Committee is so able to really
infuse energy into rural America. And I think that the growth
industry for small businesses can be there as long as we
support them at this level.
One of the things, speaking of small businesses, that I
tried to eliminate was puppy mills. I started in California
when I was in the legislature, and I have been very interested
since I have been in Congress because I do not think you ought
to be making money in an inhumane way.
And USDA finally got started in addressing the puppy mill
problem by implementing the retail store rule and the puppy
import rule. And so I want to know what has happened with the
progress you have made on licensing the internet sellers and
ensuring that puppies are not entering this country from
foreign puppy mills for resale.
Mr. Avalos. Congressman, this was a major concern. The
loophole was there. And of course, Kevin Shea and his APHIS
team did address it, so I am going to ask Mr. Shea to respond
to your question.
Mr. Shea. Mr. Farr, with the retail pet store rule, we have
had 133 entities come under license since we put that into
place, and our best knowledge so far is that about 30 to 35 of
those were entities that had had a license many years ago and
dropped it, and we believe possibly taking advantage of the
internet loophole.
So we think we are headed in the right direction by having
that many more entities come under license, and seeing that we
are getting back some of the ones who dropped their license
when they said they were no longer breeders. They were retail
pet sellers. So I think we have made some really good progress
on that, and we will continue to work on it.
MARKET DIRECTORIES
Mr. Farr. Well, would you let us know? I want to follow
through. I just think we ought to put the puppy mill breeders
out of business anywhere in the world, particularly if they are
trying to get access to the American market.
One of the things that I also wanted to compliment you on,
and maybe you can comment on it, is the work you are doing on
creating the national on-farm market directory. It seems to me,
in this light of trying to give people opportunity--what I have
seen in agriculture, and Mr. Valadao is certainly in it for a
living and I am just in it on the sidelines, but the
consolidation has just allowed no market competition.
You are a beef operator, and boy, the prices are stable.
And now you grow your beef cows on grasslands, and you can go
to a local slaughter, hopefully; we are going to try to build
that. And there you can keep it organic, and you can go and
sell it in a farmers market and all that. These really are
nifty new markets that are opening up, and restaurants who want
to buy directly from growers.
And now you are putting together this national on-the-farm
market directory, and I wanted to know how that is coming. I
guess you are doing town hall meetings to show rural America
how they can get better educated, and for the assistance that
you can give them, technical assistance for how you can do
local food promotion program grants, how you can work with the
regional rural development centers to conduct grant-writing
workshops. All these things sound really cool to me.
And I want to know, is it effective? Are people excited
about this opportunity to see a light at the end of the tunnel,
that maybe their dreams of being in agriculture might have some
play out? I know you have converted some--I read that you
converted an historic flour mill in Pennsylvania to a farmers
market, a train depot in Tennessee, a ferry building in
California, and shipping containers in New York. Is that still
going on, and what is the response?
Mr. Avalos. Congressman, first I want to say that we are so
lucky in this country that our agriculture is so large and so
diverse, and there are so many different types of growers, so
many different products. And I just want to emphasize this,
like I mentioned to the Chairman earlier.
At USDA, we are focused on all types of agriculture. It is
true that the bulk of the agriculture in this country is what
we call your mainstream agriculture. But some of the local and
regional--when I was in New Mexico, as you know, Congressman, I
worked a lot to develop local and regional markets for small
farmers. And this was an area that has been ignored for a long,
long time.
And as I mentioned to the Congresswoman earlier, back home
a lot of agricultural land that had irrigation water rights was
not being farmed. And it was not being farmed because the small
grower did not have a place to go with his product. He could
not pay the bills if he grew a crop on that farmland. But when
you did not grow on that farmland, you lost your water rights.
Three years in a row, your water rights were gone. So that is
another component of this local and regional that is so, so
important.
But to get into your question on the directory, I am going
to ask Ms. Alonzo to expand on it. Thank you.
Ms. Alonzo. Thank you, Mr. Under Secretary.
Yes, Congressman Farr. There is a lot of consumer interest
and demand for local/regional information. In fact, last year
we had about 2,000 requests for support. And as you mentioned
in terms of supporting the rural economy, Secretary Vilsack has
made support of local/regional as one of the four pillars in
terms of how we are going to support the rural economy and
economic development and jobs.
And so we are very proud of that. Something called the
``Know Your Farmer, Know Your Food'' Initiative across the
Department, where we are looking at how we can support this
growing industry, and we have had about 3,000 projects that we
have been advancing throughout the United States because of our
work collectively.
There is a lot of demand. We just had an estimate of about
$6.1 billion in sales in this area and growing. And in terms of
my agency's role, we have a multifaceted role--technical
assistance, research and information-gathering, procurement and
grant-giving.
But to your point, we recently put together four helpful
directories. There is such a need for information. Folks are
looking for where is the farmers market? Where is the food hub?
And so we have directories on farmers markets, food hubs,
community-supported agriculture, and on-site farm store
directories. They were just launched. They are voluntary, and
people are starting to put their information in so people can
become aware of where these----
Mr. Farr. Can you shift that into--do not answer this
question except for yes--can you turn that into agritourism,
all that information? Yes, you can.
Ms. Alonzo. I am sure we can, and we will say yes.
Mr. Aderholt. Mr. Valadao.
CALIFORNIA MILK MARKETING ORDER
Mr. Valadao. Thank you, Mr. Chairman. Thank you, Under
Secretary , for taking the time out for us today.
My first question is actually directed towards Ms. Anne
Alonzo. Obviously, the California dairy industry is something
close to my heart, as I am the only dairy farmer in Congress.
On February 5, 2015, USDA received a formal hearing request
from California Dairies, Incorporated, Land O'Lakes,
Incorporated, and Dairy Farmers of America, Incorporated, all
coops representing the majority of California milk, which is
owned by, as coops are all owned, by U.S. dairy farmers, to
establish a Federal milk marketing order for the State of
California.
Ms. Alonzo, can you provide us an update on the status of
California's application to establish a Federal order?
Ms. Alonzo. Yes, Congressman Valadao, and thank you for
your leadership in this area. Yes. My agency received the
proposal on February 5, and we are now requesting additional
proposals. We posted the proposal online, and we again
requested the additional proposals.
We have also sent out by mail to 2,000 folks this
information. We wanted to make sure that this is very open and
folks can understand what we are doing.
Mr. Valadao. The 2,000 are dairy farmers?
Ms. Alonzo. We believe so, yes. In terms of next steps,
there are next steps. In May 2015 we are going to host three
public outreach sessions throughout the State, and folks will
have the ability to explain the intent of their proposals and
we can explain the rulemaking process.
Then we are going to follow a formal rulemaking hearing
process to investigate the merits of this request. And in terms
of when we can expect the hearing if that were to happen, it is
going to be in September 2015, most likely in the Central
Valley of California, and we expect it to last several weeks.
And if initiated, rulemaking is expected to take over two
years.
TRADE-RISK ASSESSMENTS
Mr. Valadao. All right. Thank you.
And then Under Secretary Avalos, USDA is proposing to amend
regulations governing the importation of fruits and vegetables
by broadening the existing performance standard and using
notice-based process.
Under Secretary Avalos, would this expedited process allow
for access to the U.S. market without OMB and the Secretary 's
review? And would potentially impacted parties have the
opportunity to thoroughly review the risk assessment or to have
OMB consider economic impacts to the U.S. economy, as in such
cases as the lemon imports from Argentina?
Mr. Avalos. I guess the general answer is no. We are
looking at more efficiency, to do the job better, to meet the
needs of the stakeholders.
Mr. Valadao. What stakeholders are you referring to?
Mr. Avalos. It would be importers and exporters. But I am
going to ask Mr. Shea to answer your question because I know
that he has worked quite a bit on this issue.
Mr. Valadao. All right. Thank you.
Mr. Avalos. Now, before I do that, I did want to mention--
you mentioned lemons from Argentina. I know that is a concern
in California. I have had California folks come in to see me
several times on this issue, and I just want to assure you and
assure your citrus industry in California that before we start
talking about a proposed rule for lemons from Argentina, that
APHIS is going to do a very, very thorough site visit into
Argentina.
We are going to make sure that mitigations are in place,
that mitigations would not be removed over time, to prevent the
entry of any pest or disease from Argentina. But again, this is
in the very, very early stages, and I just want to make you
aware, Congressman----
Mr. Valadao. Appreciate that.
Mr. Avalos [continuing]. That it is on our radar and we are
talking to your industry.
Mr. Valadao. Thanks.
Mr. Shea. To get to some of your specific questions, the
Secretary would always have to approve anything that we did
along these lines.
Second, while OMB would not have formal approval
involvement, they certainly would have informal involvement,
and we are working with them so that they would always have the
opportunity to look at one of these things before we do it.
And I think the ironic thing here is we really are
proposing this to try to help stakeholders. You asked the
question, who are the stakeholders. We really think we need to
streamline our import regulation process because when we go to
other countries to try to gain new markets, often the question
back to us is, well, we would like your market as well. And our
process takes much longer than most of their processes do.
So what we were really trying to do here was to get
leverage in our trade negotiations with other countries by
being able to more quickly respond to their requests, but with
the full risk assessment done. And again, to get back to one of
your very specific questions, even under this process, the risk
assessment would be published with an ample comment period for
everyone to look at it.
Mr. Valadao. Thank you. I yield back.
Mr. Aderholt. Ms. Pingree.
ANTIMICROBIAL RESISTANCE
Ms. Pingree. Thank you, Mr. Chair, and thank you again to
the panel for being here. And I do appreciate, Mr. Under
Secretary , your remarks about the opportunity for all markets
here and how important that is at the USDA because certainly,
opening up more local and regional things and some of the
opportunities for organic growth have really been helpful in a
lot of the New England States and other places in the country.
I think my question is for APHIS about antibiotic
resistance. I do not think I have to make the case to you that
this is a very serious health concern. The CDC has told us that
at least 20 million illnesses and 23,000 deaths are caused by
antibiotic-resistant bacteria each year in the U.S. alone.
So I was very happy to see that the President's budget
acknowledges the seriousness of that threat and allocates $1.2
billion across the Government to tackle antibiotic resistance.
Of that, $77 million goes to the USDA for research alternatives
to antibiotic use, which is, as I understand it, quadrupling of
current funding. So that is great.
I just want to know more about how APHIS is going to work
with USDA's research agencies to combat the issue. Is it
working with the FDA? CDC? NIH? Just interested in a little
more about what you think is likely to happen. Or whoever wants
to answer the question; I did not mean to point at you.
Mr. Avalos. Congresswoman, let me just make a comment, and
then I will turn it over to Mr. Shea.
I just wanted to say that at USDA, we know that the use of
antibiotics is really important to the livestock industry. And
it is a priority for us to make sure that, today and going into
the future, antibiotics will still be a tool for the livestock
industry. And that is one of the reasons that we asked for this
additional funding.
Now, we are going to use this money--well, you know what? I
will let Mr. Shea expand because I know that he will have a
better answer than me.
Ms. Pingree. Well, thank you. Thank you both.
Mr. Shea. I am sure he would have had a fine answer. But
let me say that our role in APHIS is to use our on-farm
relationships to be able to gather data. I think there is an
assumption by some that farm practices constitute the biggest
problem with antimicrobial resistance. And we are not sure that
that is exactly true.
What we want to do is gather information. So we are going
to be doing surveys with farmers and ranchers. We are going to
be collecting samples and testing them at our Veterinary
Services laboratories to see what the bacteria level is on
farms.
So that is the kind of thing we are going to be doing. So
we are gathering real basic data about on-farm use of
antimicrobials to see just how they are used, and to be able to
analyze that data and provide that to the larger national
discussion with FDA and the research agencies.
Ms. Pingree. Thank you. Thank you, Mr. Chair.
FERAL SWINE PROGRAM
Mr. Aderholt. The committee provided $20 million to support
a new effort that addresses feral swine in the United States.
Animals have caused an estimated $1.5 billion annually in
damage to the United States, and frequently have interactions
with livestock and humans posing a real health risk.
Can you tell us a little bit about the actions that APHIS
has taken and what its partners have taken up to this time?
Mr. Avalos. Mr. Chairman, first of all, again, we really
appreciate your support to our feral swine program. As you
mentioned, feral swine do a lot of damage, not only to cropland
but to private property and to natural resources. And also
another thing that a lot of people forget is these feral swine,
they carry diseases like pseudorabies and brucellosis that
USDA, with the support from this Committee over the years,
eradicated in our livestock. And now these wild pigs are
carrying these diseases.
So we appreciate your support, and our folks at Wildlife
Services have really done a good job to address the issue of
feral swine. They have done a very good job to remove some of
these pigs. They have done a good job to manage the spread of
feral swine in several States. To date with the funding, we
have established 41 management programs in 41 different States.
And the good news is that in two States this year we will
eradicate feral swine, in Idaho and in Maryland. And this is
three years ahead of schedule. So I just want to applaud the
work of Mr. Shea, APHIS, and Wildlife Services in this arena.
GRAIN EXPORT INSPECTIONS
Mr. Aderholt. Let me switch to GIPSA just for a minute.
Last summer there was a great deal of upheaval at the Port of
Vancouver when the Washington State grain inspectors did not
conduct inspection of grain shipments citing safety concerns
due to an ongoing labor dispute at the port.
There was an expectation and statutory requirement that
Federal inspectors would carry out the activities in the
absence of State inspectors. To my knowledge, Federal
inspectors did not conduct inspections, also in citing safety
concerns. After a great deal of delay, the situation was
finally resolved and the Washington State inspectors resumed
their duties.
In order to expand trade opportunities, it is vital that
our trading partners know we are a reliable source of goods.
This is a situation where USDA can directly assist with export
opportunities. I know worker safety is important, but I think
the delay on behalf of USDA was unnecessarily long in this
instance.
My question is: Given what happened in Washington last
year, should all export inspection be conducted by Federal
inspectors?
Mr. Avalos. Mr. Chairman, I am going to ask Larry Mitchell,
our GIPSA administrator, to answer your question because I
agree fully that having dependable access to the ports is
critical to agricultural trade, and it is very, very important
to how our trading partners think and how they feel about us.
But this issue was very, very complicated and very, very
complex. So I am going to ask Mr. Mitchell to answer your
question.
Mr. Mitchell. Thank you, Mr. Avalos.
I believe your question was, should all the inspections be
done by Federal inspectors.
Mr. Aderholt. Given what happened in Washington.
Mr. Mitchell. Given what happened in Washington. I am not
sure that I concur with that. This was an isolated incident at
one elevator, one elevator out of over 10 export facilities in
the Pacific Northwest. There were some unique issues there.
The Washington State Department of Agriculture inspectors
found it to be a hostile and very dangerous environment to get
in and out for work. When they had to stand down, we went in to
do a safety assessment. That safety assessment showed that we
needed a full safety mitigation plan to ensure the safety of
our inspectors going in and out.
It took longer than I wanted, and longer than everyone else
that I know wanted, to get that plan established. We had the
plan established, were ready to go into the facility with
Federal inspectors, about the time that the labor-management
dispute was resolved. In fact, we were planning to go in that
morning, and the night before was when the agreement was made.
But to answer your question, I do not know that we would
have gotten in there any quicker than Washington State. It was
a very hazardous environment. I can say that we do have that
safety mitigation plan in place. It is on the shelf. Should
this occur again, the time frame for dusting it off,
reassessing it, and moving inspectors in to ensure the export
of our grain would be much shorter.
Mr. Aderholt. Well, in the future, I hope and I think we
certainly expect that GIPSA will respond in a more expedited,
swift manner if another incident like that should occur.
Mr. Farr.
MARKET DIRECTORIES
Mr. Farr. Thank you very much, Mr. Chairman. I am sorry
about your cold. I hope you get over it.
I want to again follow up on this directory because I see
these opportunities opening up. We have a farmworker training
center, not necessarily farmworkers, ag workers, who want to
learn how to be other than just pickers. They want to be able
to operate machinery. They want to actually go into farming.
And it is very successful. And they have got incubator plots
where they can start.
What they have found is that they then go out and make
contacts with restaurants and with the Community Supported
Agriculture (CSAs) and develop their own marketing. I would
love to see them get into your market directories. What are you
doing to really outreach? Do you give incentives? You said you
get a whole bunch of hits, but it seems to me these directories
really ought to be--every county in America ought to have this
directory full because I think then you can develop markets for
the tourists and, for example, the on-the-farm markets.
If you think about it, wineries have been on-the-farm
markets forever. You go to the farm and you sample what they
have and you walk away with some samples. I hope we can do that
some with meat and poultry someday with our craziness in that
area.
But is there an opportunity? What are you doing to really
go out and tell people, look, we can help you match up what you
are making, getting people here to buy it on farm, or get
people to buy a basketful of food that we will deliver to your
door under the CSAs, and to list all those things? Because
people are hungry to know about that.
When I got here in Washington--I do not think it is legal
any more--there used to be a guy that came in here with his
vegetables in our building and sold them to our offices. And
everybody raved about it because it was always fresh and it was
right from the farm.
But where there are opportunities for that, I hope you will
seize it. So what are you doing to do an outreach, and
aggressive outreach?
Mr. Avalos. Congressman, before I turn it over to Ms.
Alonzo, I just want to follow up a little bit on your
agritourism comment. It caught my attention because years ago,
when I was out in the countryside in New Mexico, we did just
that. And it was in cooperation with USDA, AMS, because at one
time they had a very strong agritourism program. And we used to
have directories, partially funded by USDA, to advertise on-
farm agritourism.
And to this day, all over the country, agritourism is a
very important component of a farm. It generates income other
than just regular crop production. Agritourism is another
source of income.
Mr. Farr. Well, wineries have done it really well. What
about the rest of it? I have got people who can pick apples and
strawberries and loganberries and raspberries. All the families
go out and do it, and if you do not want to take it home and
make your own pies, they also have a bakery there and they make
the pie so you can take the pie home. But it is just really all
this value-added.
Mr. Avalos. Oh, absolutely. And it is really another option
for a smaller producer. Instead of producing, say, their grapes
and selling them to the wholesale market to mainstream, they
can generate more money for that small acreage by selling
direct and by being creative and creating some agritourism, or
just a simple thing like a bakery, tying it with education with
the schools.
There are so many components. So when you mentioned
agritourism, it reminded me of the stuff that we used to do
years ago.
Mr. Farr. What are we doing on a national level to make
sure that you have all that information and can put it into a
standardized national directory so people can look it up county
by county, city by city?
Mr. Avalos. I think Ms. Alonzo probably can answer that
question for you.
Ms. Alonzo. Well, Congressman Farr, a top priority of ours
is communicating what we are doing. It is really not helpful to
put all these tools in place for these stakeholders unless they
know that they are available. So we keep our public affairs
office very busy with blogs, with webinars, with press
releases. We have proactively tried to communicate all these
value-added tools.
In fact, in terms of some of the grants that we have
available, we are putting in place 109 workshops this year to
go out to the different States. And I believe Congresswoman
Pingree may even be participating with us in some of these
grant workshops where we are going to be educating stakeholders
about some of our grants.
So I guess I would just summarize that we have had a very
big communications focus on these tools. And you have probably
read about some of what we are doing in some of the blogs and
the webinars and the press releases. But we recognize the
importance of communicating these programs.
Mr. Farr. Have you included flower growers in that?
Ms. Alonzo. Flower growers are very important to us. We
have funded some projects with our Specialty Crop Block Grants.
We also do grading of flowers. And I know in the past there was
an effort underway to create a committee, a checkoff, if you
will. But yes, this is all part of the stakeholders that we
serve and we communicate to.
Mr. Farr. For on-farm markets, including flowers in that
category, too?
Ms. Alonzo. I believe so.
Mr. Aderholt. Ms. DeLauro.
COUNTRY OF ORIGIN LABELING
Ms. DeLauro. Thank you, Mr. Chairman. And my apologies to
you and to our guests. Crazy day. But thank you. And I have got
a couple of questions for AMS and then for APHIS.
In AMS, Ms. Alonzo, have you been following the recent
foodborne illness outbreaks in Australia, which are the
imported berries from the Peoples Republic of China that were
contaminated with hepatitis A? We have had about, I think, 21
Australians sickened. The majority of the victims are kids.
Because of the outbreak, Australia is now considering
tightening its Country of Origin Labeling requirements.
Has AMS been consulted on what the Australian Government
intends to propose? Could those new requirements be challenged
at the WTO? And how will this labeling requirement affect U.S.
agricultural products exported to Australia?
Mr. Avalos. Congresswoman, I am not aware of the situation
and we have not been consulted. So thank you for bringing it to
our attention.
Ms. DeLauro. Terrific. Well, if you would just get back to
us, that would be great.
Mr. Avalos. Yes, we can. Absolutely.
[The information follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
POULTRY IMPORTS
Ms. DeLauro. Yes, please. Again with regard to AMS, and
this is the Chinese chicken ban, what has AMS done to implement
Section 736 of the Omnibus Bill, which would prohibit USDA from
purchasing poultry products from the Peoples Republic of China
for the various nutrition programs that the USDA administers?
Have there been communications sent to State nutrition
programs and school districts about this provision of the law?
If so, may we receive those documents?
Ms. Alonzo. Congresswoman, we only purchase 100 percent
domestically produced food under our commodity procurement
program.
Ms. DeLauro. So for the State nutrition programs and the
school district programs, you are only purchasing domestic
product?
Ms. Alonzo. That is correct.
Mr. Avalos. And also, Congresswoman, on chicken coming in
from China, right now no chicken, whether it be fresh, frozen,
or cooked, is allowed to come into this country.
FOOT AND MOUTH DISEASE
Ms. DeLauro. The language that was in the Omnibus would
prohibit because we do not know what the future will bring us
in this area. So we certainly do not want it to be part of the
nutrition programs.
Brazilian/Argentinian beef imports, the status of the two
proposed rules that would permit 14 Brazilian States and
Argentina to export fresh and chilled beef to the U.S. domestic
livestock producers have been upset about this because of foot-
and-mouth disease in their animal herds. We have not had a case
like this since 1929 because of the strict ban that we have had
on the importation of live animals or meat from these
countries. Why are we now relaxing that ban?
Mr. Avalos. Congresswoman, I want to assure you that at
USDA, it is our priority to protect the livestock industry from
any animal disease such as FMD. It is a priority that is not
going to change.
Now, I also want to state that when we get a request from
different countries, our decisions have to be science-based.
Our decisions have to follow international guidelines. And the
reason that I am saying this, Congresswoman, is because when we
seek access into other countries, we have to follow certain
criteria and that country has to follow certain criteria. So if
we are not doing what they do, we will not get market access,
either.
Ms. DeLauro. Just for one second, both Brazil and Argentina
have checkered food safety pasts. Both of these countries have
been accorded food safety equivalency by FSIS, and then we have
discovered that there are deficiencies in these systems. And
the issue is the coordination with FSIS on this, and we have
two proposed rules that would allow for the export efforts
here.
So if you could get back to me on where we stand on those
rules. And again, to answer the question, can we wait until the
GAO study--there is a GAO study going to be published before we
move to finalize the rules about allowing this or relaxing this
ban.
Mr. Avalos. Congresswoman, absolutely. We will get back to
you on where we are. I can tell you now we have had comment
periods. We have received comments. We are still reviewing
them. And we have not determined which way we are going at this
time.
[The information follows:]
Brazilian and Argentinian Beef Imports
We have not implemented any final rules regarding this issue and
are still considering how to move forward. In regard to GAO, they have
not contacted APHIS to begin an audit on beef imports from Brazil and
Argentina. When GAO contacts us to begin the audit, APHIS will be happy
to provide all of the information they request.
Ms. DeLauro. A quick question for APHIS. How engaged has
APHIS been in the two trade negotiations that are currently
taking place? Would you supply us with a list of the dates that
APHIS staff has physically participated in these negotiations
and the subject matter discussed?
Mr. Shea. We would certainly have to provide those for the
record, the exact dates. But we have been involved and we are
certainly doing everything we can to make sure that animal and
plant health considerations remain important.
Ms. DeLauro. But you will provide us with the information
and the dates and the subject matter?
Mr. Shea. We will provide any information we may have.
[The information follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Ms. DeLauro. Thank you. Thank you very, very much. I am out
of time. Thank you, Mr. Chairman.
Ms. Pingree. Mr. Chair, I have one long question on
superweeds, and I will submit it for the record and yield back
the rest of my time to Congresswoman DeLauro.
FOOD SAFETY COOPERATION
Ms. DeLauro. Thank you very much, Ms. Pingree. Thank you,
Mr. Chairman.
Would you describe again how AMS has been working with U.S.
Food and Drug Administration in the development of regulations
for the Food Safety Modernization Act? Does AMS anticipate
playing any role in the enforcement of the regulations? How
will those regulations impact any existing marketing orders
that contain food safety components to them?
Mr. Avalos. Congresswoman, I am going to ask Ms. Alonzo to
answer your question.
Ms. DeLauro. Thank you.
Ms. Alonzo. Congresswoman, as you know, FDA and FSIS are
the primary agencies with responsibility for food safety. It is
not part of our core mission.
That said, in terms of the Food Safety Modernization Act
(FSMA), I guess we like to look at ourselves as bridging the
gap, if you will, between stakeholders and the FDA to address a
lot of the concerns that might be in the marketplace about
produce safety, for example.
And so, for example, we have a full-time position that acts
as a liaison to FDA relative to all FSMA, if you will, related
activities and FDA funds the position, which is great. And we
have a jointly funded Produce Safety Alliance, which is an
effort with Cornell University. And we are trying to help the
produce industry with educational opportunities to understand
best practices, if you will, and future regulatory
requirements, especially since a lot of this is coming down the
pike.
And we also have several projects related to good
agricultural practices in the marketplace to make sure that
what we are doing aligns with FDA produce safety regulations.
And so many, many more. We have a group Good Agricultural
Practices (GAP) project with small producers to make sure that
they work together. They get audited and they get sampled, and
this pilot, if you will, is in six States and we want to expand
it.
All this to say that we have a very close relationship with
FDA, and we are working very closely on the expected FSMA
eventuality and making sure that our stakeholders feel
comfortable and educated about what is going to be required.
BEEF AND POULTRY PURCHASES
Ms. DeLauro. I have a question about the testing of beef
and poultry. What is the testing regime for beef and poultry
products that are purchased by AMS for the nutrition programs
that USDA administers? Do we have performance standards used by
the agency for the various pathogens for which it tests? If so,
what are they?
And you may not be able to answer all these now, but you
may want to--how are vendors held accountable for those
standards? What is the policy for AMS to drop a vendor from its
approved list based on the microbiological testing program that
it conducts?
Mr. Avalos. Congresswoman, these are really good questions
and very good concerns. And I do not have an answer at this
time, but if you would allow us, we would like to get back to
you and answer those questions for you.
Ms. DeLauro. Sure. I absolutely will, and I appreciate
that. Sometimes you just do not know the answer to all the
questions. I get that. But if you can get back to us on all
these issues, that would certainly be helpful.
And I want to say thank you, Mr. Chairman, and yield back
the balance of Ms. Pingree's time.
And thank you all very much.
[The information from USDA follows:]
Beef and Poultry Testing for Commodity Purchases
All beef and poultry procured by AMS must be produced at an FSIS-
inspected establishment. In addition, AMS purchase specifications
require approximately every 2,000 pounds of boneless beef trim and
every 10,000 pounds of ground beef to be tested for the presence of
microorganisms. All beef is tested for standard plate count organisms,
generic Escherichia coil, and coliforms as indicators of process
control. Any beef found to contain these microorganisms at levels
exceeding AMS-defined critical limits is rejected for purchase. In
addition, the testing results are used to monitor a vendor's process
control, based on which a vendor may be declared ineligible to produce
for AMS. Beef that is intended to be delivered raw is also tested for
Salmonella and for E. coil 026, 045, 0103, 0111, 0121, 0145, and 0157.
Any beef testing positive is rejected for purchase by AMS. Cooked diced
chicken is sampled and tested for the pathogens Salmonella and Listeria
monocytogenes, and for the following indicator microorganisms: standard
plate count organisms, total coliforms, generic E. coil, and
Staphylococcus aureus. Any lot of product found to contain pathogens or
found to exceed any indicator microorganism critical limit is rejected
for purchase by AMS. A detailed description of the AMS microbiological
purchase specification program, including sampling methodology and
sampling results, is available at http://www.ams.usda.gov/AMSv1.0/
ams.fetchTemplateData.do?temp
plate=TemplateA&navID=MicrobialTestingofCommodities&rightNav1=Microbial
TestingofCommodities&topNav=&leftNav=&page=FPPMicroDataReports&result
Type=&acct=ls std.
Mr. Aderholt. Okay. Well, thank you all for being here this
afternoon, and that concludes our hearing. And we look forward
to hearing your answers on some of these issues.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Wednesday, March 4, 2015.
FOOD AND DRUG ADMINISTRATION
WITNESSES
DR. MARGARET HAMBURG, COMMISSIONER, FOOD AND DRUG ADMINISTRATION
JAY TYLER, CHIEF FINANCIAL OFFICER, FOOD AND DRUG ADMINISTRATION
NORRIS COCHRAN, DIRECTOR, OFFICE OF BUDGET, ASSISTANT SECRETARY FOR
FINANCIAL RESOURCES, DEPARTMENT OF HEALTH AND HUMAN SERVICES
Mr. Aderholt. The Committee will come to order, and good
morning, everybody. It is good to have everyone here and
welcome everyone to the hearing. Of course, the intent of the
hearing this morning to look at the Food and Drug
Administration's fiscal year 2016 budget request.
And of course, in addition to that, as we move forward
through the hearing, I know a lot of the members will want to
seek information on the Agency's use of current and past
resources, including the activities, policies, and practices
that are supported with appropriated funds from Congress.
Our witness today is Commissioner of the Food and Drug
Administration, Dr. Margaret Hamburg. Thank you for being here.
It is good to have you here. She is joined by Norris Cochran,
who is the Deputy Assistant Secretary for Budget at the
Department of Health and Human Services--good to have you
here--and Jay Tyler, the Chief Financial Officer of FDA. So
welcome to all of you.
As you note in your statement that you have submitted, you
will be stepping down at the end of the month. And of course,
we talked about that as you were in my office earlier this
week. You have not only served six years in your current post,
and it is one of the most challenging, I think, and demanding
jobs in the Federal Government, but you have served with great
success on behalf of your dedicated staff and also on behalf of
the American people.
Of course, we have differing opinions on some things; we
all do regarding policies and regarding regulations, and
regarding funding. But there is bicameral and bipartisan
respect for the way you have provided leadership in your role
and in your very important job in the public health agency.
As I have mentioned in previous hearings, we have
established three primary goals for this Subcommittee as we
progress through the fiscal year 2016 Appropriations process.
The first goal is to improve the management of the agencies
and programs within our purview. Continuing to build upon the
efforts of previous years, our goal is enhancing accountability
in spending the taxpayer's dollars through improved Agency
governance processes and internal controls and also ensuring
transparent decision-making.
FDA has vast authority and regulations to properly oversee
various efforts under its jurisdiction--from the safety of food
and medical products, to the effectiveness of drugs and
devices, to the safety of vaccines and the blood supply. With
these responsibilities, FDA needs to utilize their oversight
capabilities in all areas to better ensure that our limited
resources are spent wisely.
The Food and Drug Administration must also tighten controls
for areas subject to large expenditures with unclear results
and where performance tasks or milestones are not met, such as
information technology. To assist Congress in monitoring the
use of scarce resources, we have authorized the transfer of
$1.5 million in fiscal year 2015 to the Department of Health
and Human Services' Office of the Inspector General.
The second goal is to target funds to the most important
programs and functions. This bill contains vast and diverse
responsibilities and a limited amount of resources. It would be
impossible to meet the full demands of any one agency, so there
are tough decisions that have to be made by this Subcommittee.
I want to continue to be sure that we make wise decisions in
allocating the funding as we move forward.
We will continue to invest in programs that prove effective
and that have broad support, such as the FDA's Medical
Countermeasures Initiative, WIC, and Rural Development
programs. We should also support programs that have a clear and
distinct reason for using Federal funding, such as addressing
emerging agricultural pest and disease threats across the
Nation or the monitoring of safety issues with food or medical
products. In order to fund these programs we must reduce or
eliminate funding for lower-priority and those that are maybe
duplicative or less effective.
And then the third goal is to promote U.S. agriculture,
free and fair markets, and safe food and medicines. The United
States has one of the safest medical product markets and the
safest, most highly productive food and agriculture sectors in
the world, and the U.S. Government plays a unique role in
ensuring that all of these sectors remain in their current
vitality.
For instance, we support a vibrant rural economy by
investing in infrastructure such as water and waste and housing
programs. We fund FDA's efforts to oversee a growing number of
drugs and drug ingredients produced outside of our borders. We
also promote a free and fair international trade regime that
allows U.S. commodities and products to be sold around the
world.
As you remind us in your testimony that you have submitted,
FDA regulates over 20 percent of every consumer dollar spent on
products in the United States. This Subcommittee must
continually remind FDA and the Administration that they need to
be very aware of the comprehensive economic impact of their
regulatory decisionmaking so that the path to greater safety
and effectiveness of products under their jurisdiction is not
littered with lost jobs and struggling small businesses.
The Agency's approval of 51 new molecular entities and
biological products as well as a record number of orphan drugs
in a single year are commendable, but we just remind you that
regulations have the potential to limit both scientific
discovery and also ingenuity.
The size of the FDA's fiscal year 2016 budget request
includes increases for budget authority that disregard the debt
crisis facing our Nation. The Agency is proposing large
increases using scarce discretionary resources. Since FDA is
informing Congress that food safety, medical product safety,
and rental and infrastructure needs are their highest
priorities this year, it will be incumbent upon FDA to prove to
Congress that such priorities cannot be funded out of base
resources first. In addition, the Agency must demonstrate that
all efforts have been made to review current operations for
potential savings and efficiencies.
Lastly, the Subcommittee and the American public need
assurance that the Agency is coordinating and not duplicating
other efforts across the Department of Health and Human
Services, the United States Department of Agriculture, and
elsewhere to ensure the most efficient means of accomplishing
its mission. We hope to touch upon each of these issues in more
detail as we move forward in the questioning process.
In looking to the proposed user fees, FDA is again
proposing to collect and spend $198.6 million in new and
unauthorized programs. While there is a time and place for user
fees, as demonstrated by the success of most of FDA's user fee
programs, FDA provides no evidence that demonstrates current
efforts are effective in assisting the beneficiaries and that
the resources for new efforts will result in better services
for the customers.
The Ryan-Murray budget deal signed into law back in 2013
capped overall spending not only on defense but also non-
defense as well. I anticipate that this Subcommittee's funding
levels will remain relatively flat at best. FDA's request for
budget authority exceeds the 2015 enacted level by 6 percent.
Today and in the months ahead, we must analyze the request and
focus on allocating the funding using the goals that I have
outlined above to the most effective and to the highest-
priority programs.
At this time I would like to recognize Ms. Pingree, who is
standing in for the distinguished Ranking Member, Mr. Farr, and
see if she has any opening remarks.
Ms. Pingree. Thank you, Mr. Chair, and I will just speak
briefly.
Thank you very much, Commissioner Hamburg, for being here
today. I am filling in the very large shoes of my colleagues
here, who are all unfortunately at many of the hearings that
are going on today. But they will be joining us soon, and I am
happy to fill in for our Ranking Member.
I will also just add my thoughts to the Chair's comments.
Thank you so much for being here today, but also for your six
years of very distinguished service at the FDA. We really
appreciate your commitment to public service and the work that
you have done here.
I know you have a lot of challenges ahead, and certainly
there will be a lot of challenges in this budget. But I think
we also do have to balance it with the growing responsibilities
of the FDA, with the tremendous number of new drugs that are
coming on line, and the very fast-changing world that you are
dealing with.
I personally have been very grateful to you for the work
you have done to help us improve the Food Safety Modernization
Act rules and working with your agency on that. I think many of
my colleagues will remain committed to providing the FDA with
the resources it needs to fully carry out its responsibility to
our public health and safety.
So I look forward to hearing your testimony today and
hearing you answer the questions of my colleagues, and thank
you very much for being here with us.
Mr. Aderholt. Thank you, Ms. Pingree.
We are also very happy to have the Chairman of the full
Appropriations Committee, Mr. Rogers, here with us, and I would
like to recognize him for any opening statement that he would
like to make.
Mr. Rogers. Thank you, Mr. Chairman. And welcome,
Commissioner and staff, to the hearing. I first want to pay
tribute to the Commissioner for six years of service at this
chore, which I think is a modern-day record if not an all-time
record tenure; but also, not just the time you have served, but
the quality of service that you have given to the country.
This is a really tough job you have. People do not
appreciate that. It is fairly obscure in the pantheon of
alphabet in the city, but the remarkable regulatory entity and
breadth of your responsibilities is astonishing. You have
brought a public health perspective to an Agency charged with
ensuring the safety of our country's drugs, biological devices,
our human and animal food chain, cosmetics, anything that emits
radiation.
Dr. Hamburg. Dietary supplements. Tobacco. [Laughter.]
Mr. Rogers. We support you in this important mission. And
while we certainly understand the breadth of your
responsibilities, I am concerned by the size of the budget
request before us. At $4.9 billion, this is the largest FDA
request in recent history. And while you have indeed taken cues
from Congress to utilize budget authority rather than saddling
industry with the costs associated with finalizing a number of
FSMA regulations this year, a $150 million increase will be
tough to swallow. We look forward to hearing from you today
about your plans for adhering to the terms of the FSMA court
order.
While I know many of the members of this Subcommittee have
a number of areas of concern, there are three that I would like
to briefly touch on with you--first, prescription drug abuse,
which I am sure you would have guessed I would put first.
As your time as Commissioner comes to a close, it gives us
all an opportunity to reflect on your legacy regarding this
issue, which is near and dear to my heart. My district in
Kentucky was ground zero for prescription drug abuse with
OxyContin a dozen years ago, which started me on my tear on
this subject.
The first time I approached FDA about the abuse of
prescription medications was in 2000, and for over a decade, my
pleas for FDA to take action on this life-or-death issue fell
on deaf ears. And in the meantime, kids and teenagers and
people from all over my district were dying, overdosing in
emergency rooms almost every night.
And when this problem reached epidemic proportions, I found
in you a willing partner, Madame Commissioner, and I am
grateful for all of your efforts to address this very complex
public health challenge. I hope you can provide an update on
the guidance for abuse-deterrent formulations that hopefully
will be finalized before your tenure comes to a close.
You have been a real champion for helping to solve this
problem with helping make prescription medicines, opioids,
abuse-deterrent. In the case of OxyContin, for example, a 12-
hour-release pain reliever for terminally ill patients, mainly
for severe pain, first you changed the definition so that it
could be used only for severe pain and not just for moderate to
severe pain. You helped educate the medical community,
particularly prescribing doctors, about the danger of this drug
if abused and the difficulty in breaking its habit. You
upscaled for tighter controls the hydrocodones. And you have,
in the case of OxyContin, for example, changed that formulation
so now it is abuse-deterrent.
You cannot shoot it up. You cannot crush it. You cannot
snort it. You can only take it for what it is supposed to be.
That is an amazing change that has taken place thanks to your
tenure and so many others in that second vein.
Second, your proposed tobacco deeming regulation is of
interest to a lot of people, as evidenced by the 135,000
comments that were submitted in response to its publication.
You and I have discussed the regulation of premium cigars in
the past. The decision FDA makes regarding e-cigarettes has the
potential to be transformative for this emerging market. I know
many are eager for your thoughts about how and whether these
products will be regulated and whether FDA has the adequate
resources and infrastructure in place to tackle a really
herculean chore.
Finally, like many, I am concerned about obstacles created
by the Chinese Government to our inspection of foreign food and
drug products. While the safety of American consumers is our
paramount concern, there is also a fundamental question about
fair trade practices. Domestic manufacturers and producers are
subjected to extensive regulation to ensure the safety of their
products, and they should have an equal playing field with
their foreign competitors. The fiscal year 2015 Omnibus
included $2 million to speed up drug facility reviews in China,
and we are looking forward to an update on that effort and
where you see it going.
With that, I am going to close my remarks here, Mr.
Chairman. And in doing so, I want to close with a very high
tribute to this public servant who has given her entire
adulthood to public service, both in New York City and, of
course, here, among others.
So Madame Commissioner, we are indebted to you. Your
service has been stellar, and we hate to see you go. You bring
a fresh, optimistic approach to things, and I hope that your
successor can be half as good as you. Thank you.
Dr. Hamburg. Thank you so much.
Mr. Aderholt. Thank you.
Commissioner Hamburg, without objection, your entire
written testimony will be included in the record. But now I
would like to recognize you for comments that you would like to
make, and then we will proceed with the questions from the
members. So the floor is yours.
Dr. Hamburg. Thank you very much. Thank you, Chairman
Rogers, Chairman Aderholt, and all the members of the
Subcommittee. And I certainly appreciate the chance to be here
before you today to discuss the President's fiscal year 2016
budget request for FDA.
This, as you know, will be my final appearance before the
Subcommittee. I am stepping down at the end of this month. So I
really do want to thank you, as I begin, for the investments
that you have made in FDA and the confidence and support that
you have placed in my leadership.
Your support has helped us address many of the demands of
our broad and increasingly complex mission, and I really have
felt that we have had the opportunity for many constructive
dialogues over the years as we have shaped our budgets and
prioritized our budget needs.
And I also want to, as I reflect on the work of this
Subcommittee, express my condolences to the family, friends,
and colleagues of Representative Alan Nunnelee. His legacy of
service I know will not be forgotten.
During my tenure at FDA, Congress has recognized the vital,
unique, and dynamic role that FDA plays in promoting and
protecting the health of the public in our increasingly complex
and global environment. You have provided the Agency with
resources, and tasked us with a multitude of new
responsibilities.
In response, our accomplishments demonstrate our ability to
respond to evolving public health needs and opportunities
across the spectrum of the products that we regulate. But even
as FDA has risen to meet these challenges, successful
implementation of our authority and existing responsibilities
really does require additional resources.
To help meet this need for fiscal year 2016, FDA is
requesting, as you noted, $4.9 billion, $2.7 billion in budget
authority and $2.2 billion in user fees. The increase above
fiscal year 2015 is $425 million, of which $148 million is new
budget authority.
Recognizing the larger pressures on the Federal budget, we
focused the budget request on essential functions and urgent
needs of our Agency, as Chairman Aderholt has indicated is a
priority for the Committee.
I would like to begin by discussing FDA's efforts to
improve and protect America's food supply. The fiscal year 2016
budget request includes a total of $1.5 billion for food
safety, including $109.5 million budget authority increase over
fiscal year 2015. And that increase will largely be dedicated
to implementing the Food Safety Modernization Act, or FSMA.
And since FSMA was passed in 2011, FDA has made
extraordinary progress in implementing the new law. We have
issued seven major proposed rules, and we have also been
developing innovative new technologies to identify the source
of foodborne outbreaks more quickly so that needed actions can
be taken to prevent additional illness.
But past achievement is no guarantee of future success,
particularly when significant funding gaps loom. We will issue
final FSMA regulations this year. Implementing these
regulations will require us to modernize inspections and
retrain staff to apply the new rules effectively and
consistently, provide guidance and technical assistance to
industry to support their compliance efforts, and invest in the
capacity of our State partners to leverage their local
knowledge and resources.
We also must address the concerns about the safety of the
large and growing volume of food imported from other countries.
FSMA empowers the Agency to hold foreign food producers to the
same standards we expect of food producers in the United
States. We must do so, as you note, to assure level playing
fields for American firms, but also to protect American
consumers.
I cannot overstate the importance of our request to fund
continued successful implementation of FSMA. A shortfall in our
funding will undermine Congress' intent to transform our
Nation's food safety program and will harm all stakeholders. If
we invest now, I am confident that we can fulfill FSMA's vision
of a modern, prevention-oriented food safety system that works
collaboratively across our global food system to reduce
foodborne illness, bolstering public confidence in the food
supply and maintaining U.S. leadership on food safety
domestically and internationally.
Now, in the vital area of medical product safety and
innovation, the fiscal year 2016 budget request provides a
program level of $2.7 billion, including a budget authority
increase of $33.2 million above fiscal year 2015. Part of the
proposed budget increase will support FDA implementation of key
initiatives of the Food and Drug Administration Safety and
Innovation Act, FDASIA, and also our important work on the
national strategy for combating antibiotic-resistant bacteria,
where we have made important strides on both the human and
animal front. But this remains a pressing public health
challenge.
An additional $10 million is to support FDA's essential
role in precision medicine and enable us to continue to speed
the development of promising new diagnostics and treatments for
patients with serious illnesses.
Our exciting work in the medical product innovation and
safety area is a testament both to new opportunities offered by
dramatic advances in science and technology as well as our
innovative approaches to expedite development and review of
medical products to address unmet medical needs while adhering
to established standards for safety and efficacy.
In 2014, FDA approved the most new drugs and biologics in
almost 20 years, and brought lifesaving drugs to market more
quickly than ever. We have also made real progress in reducing
times for medical devices to reach market. Enhanced funding
will help us to maintain our Nation's preeminence in biomedical
product innovation and safety, and will benefit us all.
Let me close by underscoring that FDA's public health
mission is indispensable to the health and well-being of every
American. We carry out our mission effectively and with few
taxpayer dollars despite dramatic expansions in our
responsibilities as a result of new legislation, scientific and
technological advances, and a globalized marketplace.
Our budget request plans for efficient spending on programs
that are essential to providing Americans with the safe foods
and the safe and effective medical products that they expect
and count on. And I know that with your ongoing support, FDA
will continue to move forward in fulfilling its critical
responsibilities to the American people even as I leave the
Agency in the very capable hands of my successor.
So thank you very much, and I am happy to try to answer any
questions that you may have.
[The information follows:]
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Mr. Aderholt. Thank you. And thanks for your testimony. And
like I said, as everyone has said, we appreciate your service
and look forward to a time of questioning.
The Chairman reminded me that I do not sound very good this
morning as I am recovering from a sore throat. So I am going to
try to do less talking, but this will be a good opportunity for
me to turn to Chairman Rogers and let me see if he has got any
questions in case he needs to slip out.
Mr. Rogers. Well, thank you very much, Mr. Chairman. I hope
you feel better.
Mr. Aderholt. I sound worse than I actually am.
Dr. Hamburg. We might have something to offer you.
[Laughter.]
Mr. Aderholt. I need something.
Mr. Rogers. You sound a little bit hurtful. It reminds me
of Mark Twain's comment about Wagner's music. He said, ``It is
really better than it sounds.''
Mr. Aderholt. Thank you. I will take that as a compliment.
[Laughter.]
PRESCRIPTION DRUG ABUSE
Mr. Rogers. Well, Dr. Hamburg, as your tenure comes to a
close here, it gives us all an opportunity to reflect somewhat
on your legacy regarding an issue, as I mentioned, that is dear
to my heart, and that is the prescription drug abuse. But you
have up-scheduled hydrocodone combination products to make them
more difficult to prescribe.
You have also changed the indication for the strongest
painkillers to severe pain only, which is a huge step forward,
because doctors really were misled when OxyContin came out. A
great pain-relief drug, but they were not aware that it was
very addictive and just how difficult it was to kick it.
So when the label said for moderate to severe pain, it was
being prescribed for toothaches and toenail hurts or what have
you when it was designed and meant to be just for terminally
ill cancer patients in severe pain. So you changed the way
doctors saw this drug, which was a huge educational opportunity
and obligation.
I spoke yesterday with Dr. Collins and Dr. Volkow, Collins
at the Health Institute, Dr. Volkow at NIDA, the drug abuse
group, about public investments in these important drug
technologies. But can you assure us that this guidance will
create the right conditions to incentivize the private sector
investment and innovation to bring better products forward?
Because that is where that research, of course, has to take
place, is in private companies. And yet if there is not the
proper incentive, financial incentive, then we will not get
better drugs. FDA staff have indicated that despite five abuse-
deterrent products now on the market, uptake of these
medications has been very slow. How do we get doctors and
insurers to come around and prescribe these abuse-deterrent
products?
Dr. Hamburg. Well, thank you. As your question notes, this
requires many different agencies and organizations coming
together to address a really important shared problem that is
devastating communities as your district in Kentucky, as you so
well know.
We think this is a high priority, and we have made it very
clear that it is within FDA and in our conversations with the
scientific research community and with our partners in
government, and of course, in our work with industry.
The abuse-deterrent guidance, which will be out by the date
that you have indicated--in fact, we think well before--will be
laying out clearly and explicitly for industry our expectations
for what kind of studies need to be done, what kind of data
needs to be collected, to demonstrate an abuse-deterrent
effect, how best to go about creating these products with
abuse-deterrent properties that can measurably make a
difference so that these products are harder to abuse.
And as you know, most of the technologies to date have been
to make it harder to inject or snort. But the oral abuse, which
is in fact the largest category of abuse and overdose, still
remains very challenging in terms of an abuse-deterrent
formulation.
So we need continued innovation, and we are trying to do
that by working with industry and the scientific community to
point out where the gaps are, where the opportunities are. We
also do need others--insurers, the healthcare community--to
step up to the plate to start to insist on better formulations
as well.
And I think we really need to continue to find strategies
to create some of the incentive framework so that companies
really want to work in this area. One thing that I have
actually talked about is with the X Prize Foundation, whether
they should do an X Prize for this because we need some out-of-
the-box thinking.
But we are encouraged. We are seeing progress in terms of
new formulations, new approaches. There are some very exciting
ideas in the pipeline. I think in partnership with NIH we can
continue to really help move some of the scientific thinking
and bring others on board in public-private partnerships.
So I think there is progress made. But we have to remember
that abuse deterrence is only that. It does not mean abuse-
proof. And we still need to work hard on the bigger picture of
reducing inappropriate prescribing of opiates and assuring
appropriate medical treatment and care, including
identification and treatment of addiction when it does occur.
Mr. Rogers. Well, prescription drug abuse is killing more
people than car wrecks in our country. CDC calls it a national
epidemic, and it is, certainly in my district, and I am sure
elsewhere.
And we do need that breakthrough. With the brilliance of
the medical community and the pharmaceuticals, there has got to
be a silver bullet out there. And I wonder whether the so-
called prodrug drugs are that silver bullet.
A pill that apparently is being tested now--a pill, but it
does not release its tranquilizing effect until it reaches the
digestive tract and reacts with enzymes in the digestive tract.
You cannot snort it or chew it or shoot it up. It does not
work, only when it reacts with the digestive juices in the
digestive tract. What do you think about that?
Dr. Hamburg. Well, you and I, I think, both had the
opportunity at your last prescription drug abuse summit last
spring to speak with the scientists working on that. I think it
is a very, very interesting approach that holds promise, and we
have been very receptive to talking with the developers about
what they are thinking about and what they should be thinking
about as they design their research/development plan.
We are eager to see that kind of new thinking and approach
evolve. We are also interested in seeing if there are other
approaches that perhaps have not really been thought of yet but
that might make a real and enduring difference.
Mr. Rogers. Well, we thank you, and we hope FDA continues
as aggressively on this track as you have been because you are
saving lives in the process. Thank you very much. But thank you
for your service.
Dr. Hamburg. Thank you.
Mr. Rogers. We hope to see you around here time and again.
In the meantime, Mr. Chairman, I have got to attend another
hearing with the Secretary of Defense.
Mr. Aderholt. Absolutely.
Mr. Rogers. Thank you, madame.
Dr. Hamburg. Thank you. Thank you so much.
Mr. Aderholt. Thank you, Chairman Rogers.
DIETARY GUIDELINES
Let me switch over to dietary guidelines. The Department of
Health and Human Services--of course, FDA is a part of that--
has the lead role in developing the Dietary Guidelines for
Americans in 2015. The Secretary of Agriculture appeared before
this Subcommittee, was sitting where you are sitting just about
a week ago. He made a commitment to adhere to the statutory
directive for developing the Dietary Guidelines for Americans.
And as he put it, and this was his quote, ``I know my role, and
I will color within the lines.''
I reminded him when he was here last week of the need to
stay focused only on the dietary and nutritional
recommendations of the Dietary Guideline Advisory Committee,
and subsequent comments collected by USDA and the Department of
Health and Human Services about these recommendations.
To quote from former Senator Bob Dole, he said, ``I believe
the Committee exceeded its mandate when it made dietary
recommendations based on environmental concerns of
sustainability.'' I urged the Secretary of Agriculture and the
Secretary of Health and Human Services to omit those
recommendations in issuing their final guidelines. The science
of nutrition can be confusing to the average consumer.
Integrating environmental consideration into dietary
recommendations lessens the report's impact and usefulness.
My question, Commissioner, would be: As a vital player in
the development of these final guidelines, can we get an
assurance from the Department of Health and Human Services that
the final report will include only nutrient and dietary
recommendations and not include environmental factors and other
extraneous material?
Dr. Hamburg. Well, our role in the nutrition space is a
little bit different. We are involved, of course, in the
Dietary Guidelines, but that is not our direct responsibility.
We have many responsibilities directly in areas of
nutrition and nutrition science, and I am really happy to be
able to report to you that we have a very strong commitment to
science-based decisionmaking in our nutrition programs; that,
as we look at what matters to promoting health and protecting
health of the American public with respect to health and
nutrition, we spend a lot of time examining what is known, what
does the literature show, soliciting input from other experts
in helping to get additional information that we might not be
aware of.
We also do undertake research ourselves and in partnership
with others. We also have just recruited a wonderful new
director of our Center for Food Safety and Applied Nutrition,
Dr. Susan Mayne, who is here, who we got from Yale University,
who has a long and distinguished career in nutrition science
and health.
So I think we are well positioned to help advance
understanding and to make sound policies based on evidence. And
certainly we try very hard to color within the lines, too. We
already have responsibilities that outstrip our resources. We
have no desire to take on new activities that are outside of
what we have been mandated and asked to do.
Mr. Aderholt. I will take that as a yes, then.
I find it interesting that the Advisory Committee has found
that cholesterol is not a nutrient of concern for over-
consumption even though previous dietary guidelines have
recommended limiting cholesterol intake to no more than 300
milligrams per day. There are other such examples in the recent
past where the Advisory Committee completely changed its focus
despite claims of sound science.
The Advisory Committee also recommended a diet higher in
plant-based foods and lower in animal-based foods as more
health-promoting even though lean meat has been included as
part of a healthy, balanced diet in previous Dietary
Guidelines. How are consumers supposed to feel confident about
following the Dietary Guidelines when the recommendations
contradict what was just put out five years ago?
Dr. Hamburg. Well, I think one of the challenges in this
arena, and other arenas as well, is that the science base is
always changing. Also, with the vast array of different kinds
of studies going on with different perspectives, it can get
very confusing about emerging information and how to put it
into context and what information consumers should rely on.
Again, I come back to my earlier answer, that we really
view as the foundation of the work we do establishing the
database and the evidence for regulatory decisionmaking. But
recognize that this is a dynamic process and new evidence
emerges as understandings of the science and of human biology
advance. And as that happens, we do think it is very important
to periodically update the work we are doing.
For example, not too long ago we put forward a proposal to
update our nutrition facts label, which is the nutrition
information on the back of various kinds of processed and other
foods. That was first begun, I think, now more than 20 years
ago, and some of the nutritional components being represented
there did not represent advances in nutrition science, and also
the serving size information did not reflect current practices
and behaviors of American consumers. So I think that is very
important so that Americans can have access to the most recent
and updated information so they can make informed choices.
Mr. Aderholt. I reminded Secretary Vilsack when he was here
last week of the enormous impact the Dietary Guidelines have on
individual diets; also, nutritionists and dieticians who plan
and prepare food for schools and other institutions and
elsewhere across the United States. I suggested to him that the
45-day timeline for the comments is too short, and he committed
to discussing extending that comment period for an additional
60 days with Secretary Burwell.
Can I get a commitment from you that you and your
colleagues will convey that need to extend that comment period?
Dr. Hamburg. Well, I will certainly reflect back to
Secretary Burwell your comments and this discussion.
Mr. Aderholt. Thank you. Well, as I say, the Secretary , I
think, was in agreement that this additional 60 days was
important because of the impact of this. And so we would
appreciate your conveying that to the Secretary , and that many
of us feel here on the committee that it is important as well.
So with that, let me recognize Mr. Farr.
Mr. Farr. Thank you very much, Mr. Buff. You transferred
questioning to Mr. Lumpy. [Laughter.]
Dr. Hamburg. I was trying figure that out.
Mr. Farr. It is interesting. He is the healthy one, and is
worried about too much Dietary Guidelines; I am the unhealthy
one that thinks that they are probably a good idea. But maybe
he follows them better than I do.
Thank you for all of your service. I know you are leaving,
and we are really going to miss you. You have been one of the
more outstanding FDA directors we have ever had, and I think,
as Mr. Rogers says, a lot has been accomplished under you.
BUDGET REQUEST
In looking over your budget request in our discussion and
in the office, it just seems that Congress, in our lawmaking,
has given you, the FDA, just tons of authorities, but we never
give you the money to carry them out. Maybe we have just over-
stretched your role.
Yet if you poll the public, you are the most trusted part
of the Federal Government, more than any--more than Congress,
certainly a lot more than Congress. Since everybody trusts you,
we are giving you more say about things in our society. But
perhaps the mission is too big or the budget is too small. I
happen to think the budget is too small.
Can you tell me what level of resources FDA needs to do the
job that Congress has mandated?
Dr. Hamburg. Well, that is a question that is of huge
importance to the Agency, although it would take some time to
really work it out and offer you a meaningful answer. But I
guess we also recognize we will never get everything we need.
But I think you are correct when you recognize that our
responsibilities, especially in an increasingly complicated
environment in terms of the advances in science and technology
of the products we are overseeing, and a new global
marketplace, those demands, and the new laws that have given
new authorities and responsibilities such as FDASIA and FSMA,
are packed full of tasks for us to undertake.
That all does outstrip the available resources that we
have, and I really think we do an extraordinary job delivering
for the American people with the resources that we have been
given, and that we take our responsibility as stewards----
Mr. Farr. But not having enough of those resources, what
are going to be the consequences for the American public?
FSMA
Dr. Hamburg. Well, I think, taking FSMA, for example, we
are asking for $109 million in budget authority from Congress
to continue the implementation of what is a historic
transformation of our food safety system in this Nation after
more than 60 years, to turn it from a reactive system that
responds after a problem has already occurred and is entrenched
to a preventive system.
It is something that industry and consumer advocates and
the public health and scientific community came together to
support, and Congress passed in a bipartisan way, with
considerable ease, in fact, at the end of the day because
everybody recognizes that this is a benefit for all.
By strengthening food safety and reducing foodborne
illness, we will save the healthcare system an estimated $78
billion a year from foodborne illness. The food industry
suffers every time there is a problem in the food system
because it undermines public confidence; even if it was not
your farm that has the contaminated food, there may be a huge
decrease and a sustained decrease in purchasing.
Mr. Farr. Yes. We saw that. My district produced 70 percent
of the spinach in the United States, when we had the E. coli in
the spinach recall. We have never since reached the level of
sales in spinach that we had prior to that.
Dr. Hamburg. Yes. So I think that while it may be a large
number in terms of past asks by the FDA for this program, this
is a critical time for implementation and it seems like there
is a terrific return on investment. If we invest now, it will
have broad tradeoffs for people, communities, healthcare, and
industry.
And we are trying to do this in the most responsible way
possible. At the time the law was passed, CBO estimated a
dollar amount for implementation of FSMA over a five-year
period, and that was something north of $500 million, $583
million over five years.
Mr. Farr. Let me drill down----
Dr. Hamburg. We have estimated that we can do it for less,
and that is what we are striving for.
GMO AND MEDICAL MARIJUANA
Mr. Farr. Yes. Let me drill down on two things that I think
are symbolic of this. I think that the public distrust is borne
out by all these local initiatives to require labeling of GMOs.
We have not had the scientific evidence to show that a
genetically modified product does any kind of harm, yet people
are, because it is genetically modified, freaked out about it.
I think California is going to have another ballot
initiative. It failed the first time in California; this time I
think it is probably going to pass. It would be interesting,
one, to get a statement from the department on GMOs, or
studies, or whatever we need to do because there is just a lot
of confusion out there.
And the second one I want to ask you about--because I do
not think FDA has ever done any studies on it--is medical
marijuana. We do not know about medical marijuana. We have
Federal laws saying medical marijuana is evil, and in order to
study it the Federal Government makes you bust down significant
research barriers. And yet we have 33 States that say, no,
medical marijuana is okay.
We have a huge conflict in credibility. It seems to be that
people are saying that it has some medical benefits. What would
it take for the FDA to have a study on marijuana? What is
holding it up?
Dr. Hamburg. Well, we agree with you that research is very,
very important to better understand medical marijuana and its
appropriate uses, especially as more and more States are
introducing law to support the use of medical marijuana. And of
course, also recreational marijuana we still should learn more
about.
FDA historically has been an advocate for more research and
has supported requests for research to be done when they come
before us and represent quality research that could provide
meaningful answers to important questions. I think it is also
useful to note that we have actually approved a couple of
products that have marijuana components in them.
But the issue of the study of the botanical marijuana plant
has been more challenging, and different agencies are involved
in it. Our role is to address the approval of investigational
new drug status for clinical studies to go forward in the
context of potential product development.
Mr. Farr. What would it take to get you to do a study on
the plant that is being used?
Dr. Hamburg. We do not generally do those kinds of studies
ourselves, but we are a key player in establishing the
appropriate conditions for those studies to go forward.
Mr. Farr. What would that take?
Dr. Hamburg. NIDA, as you may have heard when they
testified yesterday, actually is responsible for the oversight
of a farm in Mississippi that grows marijuana plants in a more
controlled way in terms of potency, et cetera. And they can
authorize use of those marijuana plants for research. And DEA
has to provide licensure to the investigators and the sites who
wish to undertake research with marijuana because it is a
Schedule I drug.
So all of those things have to align. But we are supportive
of more research being done. I think we need to ask and answer
a set of critical questions around appropriate use. And there
are a couple of studies going on at the present time. One is
involving marijuana components. One involves cannabidiol and a
drug for epilepsy specifically, intractable childhood epilepsy.
And then there is also a study going on for cancer pain.
So I think that this is a critical time for this work to be
done, and certainly are stepping up to the plate to try to make
sure that research is done in a responsible way.
Mr. Aderholt. Mr. Yoder.
Mr. Yoder. Thank you, Mr. Chairman. Dr. Hamburg, let me
echo the comments of my colleagues regarding your service and
tenure, and we appreciate your work on behalf of our great
country and wish you good luck in future endeavors.
SEQUESTRATION
I wanted to start by just highlighting our efforts to
ensure that as sequestration has impacted various levels of
government, the one area that made no sense was the impact on
the fees from industry that partners with the FDA. And when
those fees were sequestered, they basically could not go to pay
down debt. They could not go to the FDA. They would just sit in
an Al Gore-style lockbox, for a better term.
And I know that we worked to ensure that that would not
happen again, and I want to make sure that the Committee is
aware we need to continue to keep those provisions in law and
in our ongoing bill to ensure that we do not get those fees
locked out and cannot go back to the industry or the FDA. It
makes no sense.
BIOSIMILARS
I want to ask you a little bit about biosimilars, and I
know that there was legislation passed in Congress to create an
abbreviated licensure pathway for biological products that are
demonstrated to be biosimilar or interchangeable with an FDA-
licensed biological product.
FDA officials have stated several times that we would see a
pending guidance on biosimilars before the end of the year last
year. Can you inform the Committee when we can expect to see a
guidance on interchangeability, naming, labeling, indication,
extrapolation--when we can expect the FDA to release guidance
on these key public health issues related to the implementation
of biosimilars?
Dr. Hamburg. Well, there has been a lot of work, as I think
you know, in the biosimilar area, and it is very important in
terms of making very critical drugs available to more people.
And the ability to create a biosimilar pathway has been a
priority for us and a huge amount of work has been done,
including a lot of communications with industry about how to
develop biosimilar products, lots of meetings with prospective
companies. And we have, as I think is publicly known, received
some applications as well.
So it is going forward, we actually expect, very soon. I am
always warned not to be overly optimistic, but very soon to be
putting out some important guidance and decisions on
biosimilar-related issues. So stay tuned.
E-CIGARETTES
Mr. Yoder. We will be watching. I also wanted to make note
of a conversation we had in the Committee last year regarding
e-cigarettes and the emerging growth in that industry.
I think both the industry and public health organizations
are interested in the FDA's thoughts on the science,
recommendations, and regulations that would ensure that
children are not getting these products, and that we understand
the potential risks or how these may be less risky than other
alternatives. So we are looking forward to that, and we have
had conversations about that in the past. We are looking
forward to your scientific-based regulation and information on
that.
CIGARS
I did want to come back to an issue we discussed last year
as well regarding the cigars and the tobacco regulations that
the FDA is currently engaging in, and those of course would be
a variety of issues. One would be e-cigarettes. One would be
cigarettes in general. There are all sorts of issues that are
coming down.
But on the issue of cigars, I have had concerns raised from
local small businesses in my community that the one-size-fits-
all model that would be used to apply cigars to other tobacco
products would have a dramatic impact on their ability to
conduct business. And I have heard words like ``devastation''
and ``putting us out of business.'' And I know you have to
balance public health concerns with specific items and to
ensure that we are providing all the protections that Americans
expect from the FDA.
But I wonder if you could describe to the Committee the
efforts that the FDA engages in to ensure that the impact on
our small businesses at home, that you are taking that into
consideration to ensure that those ideas will be represented in
your effort. And in particular, these folks are talking about
having to put their cigars in cases, and not let folks touch
them, and just lots of things that would be inconsistent with
how they do business. I wonder if you could discuss that for
us.
Dr. Hamburg. Well, as I think you know, we issued a while
back a proposed deeming rule, which would give FDA the
authority to regulate a broader range of tobacco products than
were specifically mentioned in the tobacco law that was passed
and signed into law back in 2009.
That obviously would include e-cigarettes. But in that, we
also addressed cigars, both little cigars and flavored cigars,
but the premium cigars. And we specifically did ask for input
on premium cigars in terms of what is known about their use,
their health impact, and more information about the context of
premium cigars.
And we received a lot of comments back, not surprisingly,
over 135,000, I think someone noted already, overall to the
proposed deeming rule. So we are going very carefully through
that and trying to add the new insights that we have gotten
from the comments in many areas, but also specifically in the
premium cigar area, to what information we already had. And we
will be integrating that in and coming forward with a final
rule soon.
But as part of rulemaking, we always do an economic
analysis as well, looking at the benefits and the costs of the
rulemaking that we are undertaking.
Mr. Aderholt. Ms. Pingree.
Ms. Pingree. Thank you, Mr. Chair.
LYME DISEASE AND LDTS
Thank you again for being here today. I want to ask you a
question about Lyme disease tests. Coming from New England, and
particularly as Lyme disease spreads more rapidly into some of
the Northern New England States--Maine has seen a very high
incidence in the disease and has many concerns about the
handling, the treatment, the diagnosis of the disease.
I want to say I share some of the Administration's concerns
about the changing nature of laboratory-developed tests and
stories we have heard about false reports or questionable
interpretations. Many of us have heard about these from our
constituents.
I am glad to be revisiting the issue of their regulation in
light of the expanded rule that LDTs now play in our healthcare
system. But I am also concerned about how the FDA's exercise of
authority in this area is going to impact patient access to new
testing technology.
For example, I know that there is a great deal of attention
that has been paid to LDTs for Lyme disease, and questions
about the accuracy of unapproved tests. I agree that having
accurate and reliable test results is certainly critically
important, and the risks associated with inappropriate or
delayed treatment are grave.
I would also like to mention that the accuracy of the two-
tiered testing system recommended by the CDC and cleared by the
FDA is far from perfect. Both tests, and I am talking
technically out of my range here, but the ELISA and the Western
blot have the potential to yield false results.
In light of the lack of certainty about current testing
methods, I do not blame people who have symptoms of Lyme
disease for looking at other options in order to find out what
is making them sick. So with that in mind, just a couple of
questions about the oversight framework for the LDTs.
How will you ensure there is a level playing field that
will ensure that effective new tests will be available to
consumers without unnecessary delays? And can you detail how
the Administration currently monitors adverse events from
existing Lyme tests and how these adverse events are addressed?
Dr. Hamburg. Well, as I think you probably know, we are in
a process of reviewing the oversight of LDTs, an area where we
over a period of many, many years exercised enforcement
discretion because laboratory-developed tests, when FDA first
got authority to regulate diagnostics, were mainly tests that
were developed within a laboratory in a given facility for use
in that facility, sometimes as a part of research and sometimes
care. But they were relatively simple tests and they were not
being marketed elsewhere.
Since that time, the world has changed dramatically and
laboratory-developed tests are now being developed and marketed
broadly. They are often much more complex diagnostic tests that
are being used as the basis for really critical medical
decisions. And there is an increased number of these tests as
well.
So we felt it was a critical time, based in part because we
were getting more and more reports of faulty tests, tests that
did not do what they said they did. And we think that to serve
the American people and their health, we need to make sure that
diagnostics that will then lead to critical medical decisions
about treatment, about other potential risks or activities,
need to be overseen in terms of both analytical validity and
clinical validity.
So we have proposed a risk-based, phased-in approach,
really focusing on the high-priority laboratory-developed
tests. And our goal is to have a level playing field, to have
any test that is used for a critical medical decision to be
demonstrated, to do what it says it does, and to be accurate
and reliable.
And we feel that, actually, that will help to support
innovation because that is the criteria the American people
want. And it certainly is not good for anyone to have one set
of product developers going through the FDA oversight and
demonstrating that their diagnostic works, and others being
able to just make the laboratory test without that same degree
of rigor.
So our goal is really not to try to make fewer tests
available, but to just work with the producers of these tests
to have them provide the data that is needed to do the
assessment. But the critical thing is that we are in a process
of learning more. We did a proposed guidance, and now we are
responding to the comments that came in.
The comment period closed on February 2 of this year, I
think, and we did get a lot of comments, many detailed
comments. And we have spent a lot of time listening to
stakeholders and hearing different perspectives. And we will
proceed, but with the best interests of the patients in mind,
and with the desire to be able to support new and better tests
that will make an important difference for health.
Ms. Pingree. Great. Well, thank you for your answer. And my
time is up, but I will just again reiterate I have learned a
lot about this process, and I appreciate that you are looking
into how to make sure it is a level playing field. And I know
when it comes to diseases like Lyme, which are very hard to
diagnose, people want all the tools available to them, and then
they want to know that they are accurate. And that is
important.
Dr. Hamburg. And my colleagues just sent me a note, if I
may, just to underscore that because the patient is our focus,
that as we have been thinking about this problem, when there is
an unmet medical need and there is not an approved diagnostic
through the traditional pathway, we would exercise enforcement
discretion for LDTs in that domain.
But we certainly have been concerned about the problems you
outlined with Lyme disease and other diagnostics, where
patients have not been well served.
Ms. Pingree. Thank you.
Mr. Aderholt. Dr. Harris.
OLYMPUS SCOPE
Mr. Harris. Thank you very much, Mr. Chairman. And thank
you, Dr. Hamburg, for coming before the Committee. Just some
brief questions on a variety of topics.
There was actually an article on CNN this morning about the
Olympus scope. I understand where it changed in the elevator
channel, and they probably thought they were doing something
good. It turned out it was something bad. I think prospectively
probably no reason to know that, but we do know that now.
What changes, if any, did this case--make to our device
approval process? I think, pretty clearly, Olympus felt this
was an improvement. It turned out to be detrimental. Is there a
way we can change the process? Briefly, if you could----
Dr. Hamburg. I will try to be brief. This is a complex
topic, and we would be happy to come and give you a full
briefing.
I think it is important to first frame it that
duodenoscopes are very important medical devices addressing
serious problems and lowering risk for patients overall by
doing the endoscopic approach as opposed to open surgery.
Dr. Harris. Sure.
Dr. Hamburg. And there are about 500,000 of these done a
year to benefit patients. In the case of these duodenoscopes,
in the very nature of the task they are trying to do in ERCP
and getting into the biliary tract, the design has this
intrinsic complexity of the elevator mechanism.
The issue you are talking about that was on CNN today, I
think, is not a clearcut issue. There are three products that
are in the marketplace now. Olympus has the majority of the
market share. But all of them had been approved through the
510(k) process originally. Two of the products had a closed----
Dr. Harris. Channel. Right.
Dr. Hamburg [continuing.] Channel. Olympus' 510(k) was
originally with an open channel, and they began to manufacture
with a closed channel, I think reflecting the sense that that
might help----
Dr. Harris. Sure. It might actually help. So do you think
we need to change the approval process shortly?
Dr. Hamburg. Well, what is complicated here is they thought
they were coming into alignment with the other products in the
marketplace that were closed. They did not realize that it was
a substantial modification, from the FDA perspective, that
would require them coming to us for a 510(k). As soon as we
learned about this problem, we told them that did need----
Dr. Harris. To apply. Okay.
Dr. Hamburg. [continuing]--To apply. They initially
disagreed. There was back and forth. But now they are applying.
Dr. Harris. Thanks. And I do not have time for you to get
into any more of it. I have got a variety of questions.
Dr. Hamburg. Yes.
HYDROGENATED OILS
Dr. Harris. The next two, or three, really, deal with some
scientific evidence. One is on partially hydrogenated oils. My
understanding is that the FDA had announced a tentative
determination to ban all partially hydrogenated oils. And my
understanding is that there may be something coming out that
would give only a year for a transition to eliminate all
partially hydrogenated oils.
But the scientific evidence is that below a level of 2
grams a day--or, I am sorry, 2 percent total energy a day,
which is 4 to 5 grams per day--the evidence is not good that
you are achieving anything, that in fact, like a lot of things,
if you take a whole lot it is bad for you, but a little bit is
not bad for you at all.
So there are industries like the baking industry that uses
partially hydrogenated oils which would be severely handicapped
by a one-year process. I do not bake, but my understanding is
that the oils you use are very important, and that changing
over to a new oil is not easy.
A simple question: Why just one year? We have lived with
partially hydrogenated oils. We have decreased the consumption
by 75 percent over the past 10 years. Why rush to this? Why not
give a couple years' transition, a two- to three-year
transition?
Dr. Hamburg. Well, partially answering Congressman Yoder's
question also about the analyses we do, we have been working
closely with the industry and hearing their concerns about
product reformulation and access and use of other oil
substitutes, et cetera.
We are not locked into a phase-in period. We think, based
on the available science, that decreasing partially
hydrogenated oils to as close to zero in the diet as we can get
and using other oils instead would be extremely----
Dr. Harris. Well, I would appreciate you just to show me
the studies that show that decreasing it to near zero is a
substantial decrease in risk from, as I said, the 2 percent
energy or 4 to 5 grams a day.
SODIUM INTAKE
Finally, in terms of salt, intriguing article last year in
New England Journal of Medicine from the PURE study. Look, I
grew up learning in medical school, yes, salt is bad, and you
tell everybody, eat a little less salt. Yet that study actually
indicates that if you are a healthy person, you actually have
an increased cardiovascular risk of salt restriction.
That is not clear. I think the party line is that salt is
bad and decreasing salt is good. But it appears that is not
really true. Is the FDA thinking about working with the Dietary
Guidelines to admit there is actually real uncertainty about
which category of patients benefit and which actually may be
harmed by limiting sodium intake?
Dr. Hamburg. Well, I think that there is a very large body
of evidence and literature that supports the value of
reductions in sodium from the average intake of Americans
today. There have been some studies that have raised questions,
and it is very hard to realistically do some of the studies
that might definitively show the one-to-one causation because
these are cardiovascular risk, and risk of stroke is very
multi-determined.
But we do know a couple things--that most of the sodium
that people take is from processed food, not from the salt
shakers, and that if we are going to make a difference, we do
need to look at that source of sodium. And we do know, as I
said, that there is a very large body of literature that shows
that reducing sodium has significant meaningful impacts on
hypertension and other risks.
So I think that we are deeply involved in examining the
science. I mentioned our new center director for the Center for
Food Safety and Applied Nutrition. She is already deep into
these issues and reviewing all of the more recent studies as
well.
But I think that we should not, because of a new study or a
suite of studies that have come out, fail to look at the full
body of evidence. And I think that we are, as I said, committed
to making sure that we look at all the data, evaluate the
quality of the science, and make our decisions based on what we
feel, with input from a large number of stakeholders and
subject matter experts, make the best decisions that we can
make.
So it sounds like we need to come up and do some briefings
with you on a couple of topics where your medical background
may lead you to have some special expertise and interest.
Dr. Harris. Thank you very much. And thank you, Mr.
Chairman.
Mr. Aderholt. Ms. DeLauro.
Ms. DeLauro. Thank you very much, Mr. Chairman. And
Commissioner, I apologize for being so late. But Secretary
Duncan is next door at Labor, Health and Human Services, and
Education. So we are tearing up the hallway here.
But first let me say to you that I read your testimony, and
I just want to say one thing, where you say that FDA is: ``A
science-based regulatory Agency charged with an enormous and
significant public health mission to promote and protect the
health of the American people. Our goal in carrying out of
mission is to ensure the safety, effectiveness, and quality of
medical products as well as the safety and security of the vast
majority of our Nation's food supply.'' And you go on.
But I want to say to you, thank you. Thank you for
restoring the mission, the original mission, of the Food and
Drug Administration. And you have worked tirelessly to make
sure that that scientific and regulatory effort has come
together for the benefit of the people of this country. We owe
you a real debt of gratitude. And my personal thanks to you for
all that you have done.
I am also happy to say hello to Dr. Susan Mayne of Yale
University. Yes? Here we go. The new director of CFSAN, and
your own science background will indeed lend so much to the
direction that we need to go to instead of dealing with
anecdotes, but deal with the science.
FOOD SAFETY MODERNIZATION ACT
Let me ask a question. You know that, Commissioner, I have
been a strong supporter of the Food Safety Modernization Act
(FSMA) for many years, and I am excited that the pieces are
falling into place this year. And now you have made a
substantial budget authority request, as we asked you to do. We
asked you to do this.
The consent agreement requires you to implement the rules.
You have been incredibly transparent with your budget materials
and in your communication with this Committee. To some extent,
the ball is in our court now. So let me ask you: What happens
if you do not get the funding that you need in 2016? How will
that affect public health? How will it affect growers and food
makers who rely on the certainty of the rules that you have
published and the law that we passed?
Dr. Hamburg. Well, it is such an important question, and is
certainly one of the great worries that we have because this is
such an important new law, and implementing it right matters to
everyone.
If we could not get the resources that we need, we will not
be able to undertake a set of really critical activities that
will ensure a smooth, effective, and efficient implementation
and the realization of the benefits of a system that in fact is
based on prevention, a system that is based on partnership,
leveraging resources at the local, State, Federal, and
international level, and one that recognizes that the food
safety system is far more complex than it has ever been, with a
hugely increasing volume of imported food coming from countries
around the world that do not have the kind of oversight and
regulatory systems that we have to protect American consumers.
So we are asking for this money to do an important set of
tasks--to modernize our inspection system and do training
necessary to have efficient, appropriate inspections; to do
technical assistance and work with companies so they know what
is expected and how to, in a streamlined way, implement this
new law and be compliant.
We need to give the States resources so they can be our
partners in a national integrated food safety system, and do
training and technical assistance with them as well so that we
have a coherent and aligned program. We need to work on the
import side with the foreign supplier verification program so
that we can raise the standards and oversight overseas so that
we have a level playing field for American firms and we have
assurances of quality and safety for the American people.
Ms. DeLauro. Also to protect our growers. Protect our
growers.
Dr. Hamburg. Protect our growers and protect our consumers.
And also, we are trying to move as much as we can to using more
risk analytics to streamline our systems for prioritizing high-
risk and lower-risk products that benefit industry so that
companies with good track records and performance can move
through the import process more quickly while, when there have
been problems, we focus on those, or we have reasons to have
concerns.
So it will disrupt what could be a very smooth and
efficient implementation process that would benefit all and
create a fragmented effort that will not enable us to realize
the benefits of FSMA, and it will not enable us to assure
industry the benefits that they are looking for as well.
Ms. DeLauro. My time is over. Let me put this out there, if
you can get back.
FDA is under court order to issue the regulations necessary
to implement the Food Safety Modernization Act. The rule's
preventive controls for human and animal food, produce safety
standards, and the foreign supplier verification are essential
to implementing the law. And you can get back: Will the FDA
meet these court-imposed deadlines, and what are the hurdles to
meeting the deadlines? So that we know and can be helpful in
this regard.
Dr. Hamburg. Thank you. An important question. I will be
quick. We are committed, both because it is the right thing to
do and because we are under court order, to getting those
regulations finished on time. We took it very seriously to
develop those regs with the right stakeholder input, and we
took time and listened and learned. And I think that the final
regs will reflect the best possible understanding of how to
implement this law right.
But we will get it done. And it has taken an enormous
amount of effort, a lot of redirection of our FDA employees
from other important work to get this job done.
Ms. DeLauro. Thank you very much. And again, our very best
wishes are with you. Thank you.
Mr. Yoder [presiding]. The chair is now ready to welcome
the distinguished Ranking Member to the Committee, and would
recognize her for her comments and questions.
Mrs. Lowey. Thank you so much, Dr. Hamburg, for joining us.
And again, I apologize. As you probably heard, we have four
hearings at the same time this morning. So it is a delight to
be Ranking Member, but with that comes responsibilities, and I
do apologize for being late. And I also want to take this
opportunity to thank you for your outstanding service, and I do
wish you well in the next chapter of your career. Thank you.
COMPOUNDING
As you know, the FDA recently released draft guidance
concerning the compounding or repackaging of biologics. The
issue of drug compounding is of critical importance to our
public health, particularly for injectable medication. So it is
vital that patients receive safe and effective products that
are manufactured to the highest standards.
When can we expect the final guidance on compounding to be
issued? Will the final guidance maintain the intent that there
should be a single set of standards that all manufacturers of
biologic products must meet?
Dr. Hamburg. Well, we have been working very hard since
Congress passed DQSA to implement it and to build on other work
we were doing with respect to the compounding pharmacy issue.
We have already put forward quite a number of guidances and
taken a lot of relevant actions in terms of outlining a number
of critical issues around GMPs, good manufacturing practices,
fees, adverse event reporting, et cetera. But we have more work
to be done.
We recently held the first meeting of the Advisory
Committee, which is going to be very important to us, and I
think we have got a good, strong group with diverse points of
view, but important to inform our decision-making as well. So I
am not sure exactly which guidance you are referring to, but I
would say that an extraordinary amount of work has gone on in a
very short time as we try to build up this program.
And in particular, I think your focus is on the outsourcing
facilities, which is created as part of DQSA 503(b), to create
a new category of facility, outsourcing facilities, where
companies can choose to register with us, be subject to FDA
oversight and regulation for the manufacture of sterile
injectables.
And I think that those products will reflect a level of
quality and benefit for patients that will be much desired,
especially when we look at the current environment and all of
the many problems that we have seen with sterility practices in
certain compounding pharmacies.
E-CIGARETTES
Mrs. Lowey. E-cigarettes. These stores are popping up
everywhere. And we know cigarette products are regulated by the
FDA. Only e-cigarettes that are marketed for therapeutic
purposes are currently regulated by the FDA.
I have been in and out of those stores, and I am concerned
that new tobacco products on the market may be able to do
serious harm without being regulated by the FDA. How would the
budget request support increased research and supervision of
tobacco products? And have you been doing any work on these new
e-cigarette stores that are opening up?
Dr. Hamburg. Well, it is such an important question, such
an area in terms of public health. We have a major set of
activities going on, not part of the budget request because our
Center for Tobacco Products and our tobacco program is fully
funded by industry user fees.
But I think it is important to note that with e-cigarettes,
which is an emerging tobacco-related product, there are a lot
of open questions and a lot of differing points of view about
their risks and their potential benefits in terms of an
alternative to combustible cigarettes.
When the Family Smoking Prevention and Tobacco Control Act
was passed in 2009, it only specifically gave FDA the authority
to regulate, cigarettes, cigarette tobacco, smokeless tobacco,
and roll-your-own, but said we could expand our own authorities
through regulation.
We recently did put forward a proposed deeming rule in that
context to extend our regulatory authority over tobacco
products, some of which were not even much present in the
marketplace when the law was first passed. And that would
include giving FDA the authority to regulate e-cigarettes. We
got over 135,000 comments on that proposed deeming rule, which
we are going through now, but will be finalizing. And that will
then lay the foundation for regulation in certain areas,
including e-cigarettes.
I also want to underscore that we have invested a lot of
resources in expanding the research base around e-cigarettes
and other aspects of tobacco products, tobacco-related behavior
and use, the ingredients in tobacco products, and of course the
health impact of tobacco products.
And in that regard, a lot of important work is currently
going on around e-cigarettes to better understand them. And
that will obviously be a huge contribution to our regulatory
work and also to our understanding of this really important
public health issue for the broader American people--and
frankly, for the world because I think we have been funding the
most advanced research program anywhere.
Mrs. Lowey. So at this moment, the e-cigarette stores can
keep multiplying?
Dr. Hamburg. They are not subject to FDA regulation.
Mrs. Lowey. Are they subject to anyone's regulations? I
guess not.
Dr. Hamburg. States and localities have established their
own regulatory frameworks in some instances. But we think it is
very important that we finalize the deeming rule in a timely
way so that we can begin to have regulatory oversight of the e-
cigarette products and other products as well.
Mrs. Lowey. Thank you very much.
Mr. Yoder. Mr. Young.
Mr. Young. Thank you, Mr. Chairman, and thank you for being
here. Appreciate you coming.
GMOS
Ranking Member Farr mentioned GMOs, and I wanted to pick up
on that. As you know, there has been a push by some States and
some consumer groups to label foods with any GMO ingredient.
Recently the National Association of State Departments of
Agriculture passed a resolution supporting a national uniform
labeling policy of foods derived from GMOs and reasserting the
FDA's food labeling authority.
Do you have plans to mandate GMO labels, even though these
foods are proven safe and can help end hunger around the world?
Dr. Hamburg. Well, historically the FDA's position in terms
of its responsibilities around labeling have really been to
address our mandate, which is that we prohibit false and
misleading labeling. There needs to be a demonstration of a
material change to the product.
In the case of GMO--we like to say genetically engineered
products because they are not organisms--we do not see, and
actually the courts have supported this position in the past,
that mandatory labeling would be indicated or appropriate if
there is not a material change to the product. The process
itself is not that.
If the genetic engineering process changed the nature of
the product--for example, if it was an oil and it no longer
fried in the same way--or if it introduced something that was a
material change, and particularly if it could represent a risk,
like introduced a peanut antigen that someone would not expect
in that product but could cause harm in someone who was
allergic to peanuts, then that fact would have to be indicated
on the label, not that it was genetically engineered but the
nature of the material change to the product.
We do understand that many consumers want to know what is
in the foods they eat, and we support individual companies that
want to voluntarily label their products to do so. And we are
working on a guidance to industry with respect to voluntary
labeling of genetically engineered products, starting first
with plant-based products. So I hope that answers your
question.
Mr. Young. Thank you. A lot of us are trying to fight that
misconception about GMOs and GEs, that they are unsafe. What
can the FDA do to help combat this misconception?
Dr. Hamburg. Well, as has been noted, we really do strive
very hard to look at the science base for our decision-making,
and we apply that in the area of genetically engineered foods
as well.
SINGLE FOOD SAFETY AGENCY
Mr. Young. My next question touches on an issue a lot of
livestock groups are concerned about: the proposal
consolidating the USDA FSIS and the FDA's food safety
inspections into a new agency at HHS. The thought is: Is HHS
the most appropriate agency to head food safety, with it not
having that kind of inspection experience as other agencies
have had?
Can you comment on your current food safety mission and the
interactions or overlap between the two agencies? Have you
looked at potential efficiency gains that can be achieved under
the current two-agency system?
Dr. Hamburg. Well, as you know, USDA and FDA are the two
largest organizations--we are an agency, they are a
department--involved in food safety. We are responsible for 80
percent of the food supply and they are responsible for about
20 percent of the food supply. We do everything, basically,
except meat, poultry, and processed eggs.
But there are many other components of government that
actually are involved in food safety as well. It has been
historically a fragmented system, and people have talked about
the need for better integration over time. And I think it is a
discussion worth having in terms of how can we best align the
different components of government that are involved in food
safety, and what kind of an organizational structure would be
necessary to best support that.
I think it is very interesting to look at what we are doing
in FSMA, and implementing the Food Safety Modernization Act is
one example of how we can work together effectively. We
recognize that while we have a huge amount of inspectional
experience in the food area, we have not been on the farms
nearly as much as USDA. And there is a huge amount of
experience, expertise, and trust in the grower community of
USDA.
And so we have worked hard with USDA, as we have begun to
develop our regs for FSMA and then as we move into the
implementation phase, to take advantage of their expertise and
their role in the communities, and to work in partnership. So
we are in different agencies. We have different legal/
regulatory frameworks for our work. But we are working in
partnership to try to get the job done.
Mr. Young. Thank you. I believe my time is about up. Can I
get 20 seconds, Mr. Chairman?
Mr. Yoder. Fifteen.
MEDICAL MARIJUANA
Mr. Young. I want to follow up on Mr. Farr's issue
regarding medical marijuana.
You talked about some other agencies and groups that have
done studies on medical marijuana. Has the FDA ever done any
research or studies on medical marijuana, and is that public?
Do you need a mandate to do those studies?
Dr. Hamburg. Well, we do a variety of different types of
research. We do not generally undertake clinical studies of any
drugs that are in development. That is usually undertaken by
industry, often undertaken by industry in conjunction with
private research.
Mr. Young. So no clinical studies. Have you ever looked at
the issue?
Dr. Hamburg. No. As far as I know, we have not been
involved ourselves in conducting clinical research on
marijuana. We have been involved in reviewing clinical research
proposals for potential products that include components of
marijuana.
Mr. Young. Well, they are out there, if you have been to
Colorado.
Thank you very much, Mr. Chairman.
Mr. Yoder. The Chair recognizes Mr. Valadao.
Mr. Valadao. Thank you, Chairman.
FSMA
I appreciate your taking some time out for us today. My
first question is about FSMA. FSMA enables FDA to better
protect public health by strengthening the food safety system
and empowering the FDA to overhaul the existing program. This
Subcommittee has provided a considerable amount of funding to
support the implementation of FSMA. Commissioner Hamburg, could
you please tell us how some of this additional funding has been
used by FDA to implement FSMA?
And you and your staff have visited many farms in
California. And based on your meetings and experiences with
farmers, how do you interpret their feelings about FSMA
implementation, and do you believe they are confident that
their input will be received?
Dr. Hamburg. Well, answering your second question first, a
number of us have spent time on farms across the country,
including in California. I had actually the opportunity to go
with Congressman Farr to his district and visit a number of
farms and meet with the leafy green producers in particular.
I would say that we have learned an enormous amount from
those visits, both about what are best practices that we want
to build on rather than reinvent the wheel, and also about the
realities of implementation and how we can address a set of
concerns that would make the implementation more cumbersome in
ways that achieve all of the goals but understand more clearly
where are the opportunities to reduce risks by changes in
practice.
So the visits have been enormously helpful. And as a result
of some of our visits, our town halls, our discussions, and
input, we actually put forward four supplementals in our
rulemaking process that reflected changes in thinking in
response to input so we could make the best rule possible.
With respect to how have we used the resources already, we
have been working flat out to meet the requirements of FSMA and
to get these rules done and to get them done in the most
responsible way possible, which has not been just sitting at
our desks, as I was just describing to you, but really going
out and walking the fields and the processing plants and other
things to understand the issues, to hear the concerns, and have
those integrated into our final approach.
And I would say that we did not start to implement FSMA
replete in terms of resources. We were already at a deficit.
When FSMA passed back in 2011, our Center for Food Safety and
applied Nutrition had fewer employees in it than it had 20
years before that. So we redirected employees. We galvanized
everyone. We had them, sadly, working through the Christmas
holidays two years in a row in order to meet deadlines and
achieve our goals.
But we do need real money to get the job done. And I think
that, as I said----
Mr. Valadao. Thank you.
Dr. Hamburg [continuing]. If we make this investment, it
will benefit all.
BIOSIMILARS
Mr. Valadao. And I also want to echo Representative Yoder's
comments on biosimilars. That is an important issue, obviously,
for us in California as well and a lot of folks that create a
lot of jobs there. So it is something that I would like to
echo.
SUBSTANTIAL EQUIVALENCE
I also wanted to touch on another issue. According to the
September 2013 GAO report, over 3800 substantial equivalence
applications have been submitted as of January 7, 2013. My
understanding is that today the number of applications is
nearly 4500, of which only 95 have received final action.
Do you feel that this amount of backlog is acceptable? Is
there a reason that the Agency is not using its unobligated
user fees for clearing this backlog, as is in the case of
tobacco? And is there not a statutory deadline for FDA to issue
a substantial equivalence order or for the FDA to grant or deny
the exemption request? Given the delays in FDA's implementation
of the time-sensitive application process procedure, do you
feel that such a deadline should be imposed?
Dr. Hamburg. Well, first let me say this is a very new
program. We just stood up the center a few years ago, and it
has been expanding rapidly. And this is a whole new area of
undertaking, never done anywhere in the world before. And we
are moving much more efficiently as we learn more about what to
do and how to do it.
I do want to turn, if I can take the liberty of asking
Mitch Zeller, Director of the Center for Tobacco Products, to
respond because he is much more familiar with some of the
details, and I think in order to give you the best answer
possible.
Mr. Yoder. Is there objection? [No response.]
Mr. Yoder. Without objection. Please, sir, go ahead.
Mr. Zeller. Thank you so much for the question, Mr.
Valadao. Here are the numbers.
There are applications for products that are already on the
market that we have made a lower priority than the applications
for the products that are not currently on the market. For the
applications for products that are not currently on the market,
there is no backlog. As soon as a new application comes in, we
commence a review immediately.
And of the roughly 1,000 of those applications that are for
products not currently on the market, we have resolved over
half of them, and that is from zero a couple of years ago. We
are up to either saying yes, saying no, or a company
withdrawing them. So we are at 52 percent resolved, and there
is no backlog for new applications coming in.
Mr. Valadao. Thank you. I yield back.
Mr. Yoder. Mrs. Lowey.
Mrs. Lowey. Well, thank you.
DIETARY SUPPLEMENTS
On another area, you probably do not know, but labeling has
been a key issue of mine. It took me a long time the first time
trying to get labeling on products. The FDA requires
verification that products are safe and have adequate labeling,
but unlike medications, supplements are not subject to the same
evaluations process as medication.
Now, in my home State of New York, a recent investigation
found that 21 percent of the test results from store brand
herbal supplements contained traces of the plant species listed
on its label. The remainder, 79 percent of supplements tested,
showed no DNA relationship with the plant listed or had
contamination of other plant material.
I am really concerned about what that means for those with
allergies who may not know that supplements they consume may be
contaminated by other substances which could cause the
individual great harm. Should supplements, in your opinion, be
evaluated at a higher standard? How should labeling standards
be improved to make sure that allergens are properly declined?
Dr. Hamburg. Very important questions. And I think many
Americans are actually surprised to learn that dietary
supplements are not subject to the same premarket review and
approval process that drugs are by the FDA. We do have
responsibilities with respect to claims and oversight of good
manufacturing practices, and it is required that companies
report serious adverse event reports to us.
So we do monitor dietary supplements, and we are, sadly,
called to action in terms of enforcement periodically because
of findings that dietary supplements contain unapproved drugs,
various kinds of contaminants, or are making claims that are
false and misleading.
The challenge is increased by the fact that many, many
dietary supplements are now coming from countries all over the
world, subject to these complex supply chains and increasing
vulnerabilities to substandard contaminated or adulterated
product. So it is an area that I think we are concerned about,
and we continue to act within the responsibilities that we have
been given for oversight of dietary supplements. And certainly
when we hear of concerns, we respond.
Mrs. Lowey. I appreciate it. But the question is, should
they be evaluated at a higher standard, and is it the
responsibility of your Agency? It is not now, I gather. Should
it be, and is there something we should do about it or could do
about it?
Dr. Hamburg. It is not now, and I think that there are
concerns. And we want to work closely with industry and the
responsible players in industry to see how we can ensure a
higher level of quality. But we do not have the authority for
premarket review. We certainly do not at the present time have
the resources, either, but that is a discussion that certainly
Congress could undertake in light of some of the concerns that
have emerged.
Mrs. Lowey. So in order to change the standards and to
expand your authority, Congress would have to give you
directive? Is that what you are saying?
Dr. Hamburg. Yes. We do not have the authority for
premarket review and approval. And it would be a very large new
set of tasks for us, but certainly these products----
Mrs. Lowey. But should it be done, now that you are leaving
and going on to other things? [Laughter.]
Mrs. Lowey. Not that I am trying to----
Dr. Hamburg. I have seen very serious concerns. And I think
that there are a set of very reputable manufacturers out there.
But especially in a globalized world, the quality of products
is clearly inadequate. And I also do believe that there are the
so-called snake oil salesmen out there as well that are pushing
products with claims that simply do not reflect benefits to
consumers. And consumers are spending a lot of money on these
products.
Mrs. Lowey. So we will work on that. So in other words, you
think it would be a good idea.
Dr. Hamburg. I think it should be examined. This comes up
on a regular basis.
Mrs. Lowey. Oh, I remember. Thank you very much, and thank
you, Mr. Chairman.
Mr. Yoder. Thank you. Dr. Harris.
COMPOUNDING
Dr. Harris. Thank you very much. I guess this is the
lightning round.
First, in terms of drug shortages, I just want to bring to
your attention one concern. As an anesthesiologist working in
an operating room, the USP 797, the compounding regulation with
the one-hour rule, does not make any exception at all for
things done in an operating room, which is a sterile
environment, different situation.
Has the FDA done anything or plan to work with USP to
create an exception with regards to certain environments with
regards to the safety of compounding?
Dr. Hamburg. No. I do not know the answer to the question,
so I will be quick. We will get back thank you.
[The information follows:]
FDA has several staff participating as liaisions in the USP
Compounding Expert Committee's efforts to revise USP Chapter
797,Pharmaceutical Compounding--Sterile Preparations. The intent of all
involved is to improve standards for pharmacy compounding, and
especially for aseptic practice, where we have seen so many issues.
Dr. Harris. You can get back to me. I appreciate that.
And we talked in my office about drug shortages. Again,
anything you can do to help because in the operating room
environment, there are several drugs that we do not have ready
availability to on occasion.
With regards to the e-cigarettes, just a couple of followup
questions. Is harm reduction potential going to be part of
consideration when you look at product approval or not? Because
there is some evidence that in some populations, people do give
up smoking and use e-cigarettes. So there is some benefit.
There might be risk, but there is some benefit. So I take it
that that harm reduction potential is taken into consideration
under certain circumstances.
Dr. Hamburg. And there actually is--Mitch can correct me if
I am wrong--a pathway for companies to actually seek a reduced
harm label.
SUBSTANTIAL EQUIVALENCE
Dr. Harris. And with regards to the substantially
equivalent product consideration, GAO, as you know, has issued
a report very critical of the backlog. Is that something you
are working through?
Dr. Hamburg. Well, that is. And I thought that Mitch gave a
very--I do not know, you may not have heard--but a very nice
overview of the progress that has been made, and that there
actually are not backlogs in some of the critical areas that
were present earlier. This was a program that was being started
from scratch, and we had to build----
Dr. Harris. Sure. No, I understand.
Dr. Hamburg [continuing]. And the procedures. But I think
it is----
TROPICAL DISEASE PRIORITY REVIEW VOUCHER
Dr. Harris. Keep going. The Tropical Disease Priority
Review Voucher Program obviously increased the tension because
of Ebola. Are you considering adding diseases to the program,
and has the FDA begun work to add diseases to that program?
Dr. Hamburg. We are very, very eager to continue to advance
new antibiotic development, and particularly for under-met
medical needs, including tropical diseases. And as you know, we
are seeing diseases moving slowly but steadily into the United
States and becoming endemic in many cases, and ones where we
badly need treatments or vaccines.
The process for the priority voucher may be one where
actually--I think the list may be statutorily defined. There is
another process that we have been using and we think has been
working very effectively, which was part of the GAIN Act, in
terms of qualified infectious diseases that creates a program
to incentivize companies to develop new products in that area.
And we have, I think, designated over 60 in that program
and approved four new drugs. That was part of FDASIA, so it has
only been in existence for a few years. So I think that is
another very viable option for how to get more of these drugs
developed and into use.
THREE-PARENT EMBRYO
Dr. Harris. Thank you. Finally, one thing that was asked in
last year's testimony--I was not on the Subcommittee last
year--was about the whole three-parent embryo issue. Obviously,
some ethical concerns. That will be discussed elsewhere. But
the U.K. Parliament has approved it.
Has the FDA received a request for approval here or for
guidance of similar techniques? Are you considering further
hearings or actions? Where does that stand?
Dr. Hamburg. Yes. Well, I think the U.K. Parliament
approved it for research. We have had an approach on this
technology, and we did hold a public meeting I think some time
last year where issues of science and ethics were discussed.
We subsequently asked the Institute of Medicine at the
National Academy of Sciences to actually look at the ethical
issues because we do not think that the FDA is the right place
for that, but we think they certainly need to be examined in
some depth.
So it is certainly a technology that is being examined. We
will learn more from the U.K. experience. We await the input
from the Institute of Medicine.
Dr. Harris. But has FDA received a request for approval or
guidance at this point from anyone?
Dr. Hamburg. Well, we have received inquiries about the
development of research in this area, and that was what led to
the public meeting that I mentioned.
Dr. Harris. And do they intend to have more meetings as
this develops?
Dr. Hamburg. Well, I think we are taking it one step at a
time, and we need to look at both where is the science--this is
for an approach that would enable women that have a
mitochondrial disease that can be passed on, that would be
passed on, to their offspring to have----
Dr. Harris. Oh, I understand the science. Thank you very
much. I yield back.
Mr. Aderholt [presiding]. Before I go to Mr. Farr, let me
just add--and thank you, Dr. Harris, for bringing this issue up
because I am hearing more and more about it. And I think it is
important that FDA does consider the ethical considerations of
this three-parent embryo because from my colleagues I am
hearing more and more concern about this. So I would encourage
you to take that very seriously as we move on, and we may think
of some ways that we can work together on that.
Mr. Farr.
Mr. Farr. Welcome to the hearing of drug du jour. I have
something to ask you about, but I just wanted to--in fact, I
will just go through my list and then you can respond.
First, what struck me is you remember the panic with the
Ebola, of all the patients arriving here? And we just panicked.
This country just--we got lots of questions at home, our
offices. People were scared. And yet we have had this measles
outbreak and there does not seem to be a scare. What is the
difference? Why does Ebola freak us out and measles not? We
have not heard the hue and cry. That is just a generic
question.
The specific question on drugs is, I want to ask you about
the female sexual dysfunction drug. I understand that there are
26 FDA-approved drugs for the treatment of male sexual
dysfunction, but there are zero, none, for women. There also
seems to be disparities in the approval process requirements
for these drugs between those for men and those for women.
For example, the male drugs got all priority reviews. The
female drugs all got denied. The female drugs had to go through
a multitude of formal public meetings. The male drugs had none.
Why are the drugs for the female problem being handled
differently than those for the male problem?
Second question. For years this Committee has asked about
sunscreen approval, and for years the Committee has put strong
language in the report directing the FDA to act affirmatively
in moving the process along. Last year Congress passed, and the
President signed, a new law on the issue. And yet this year we
are at a dead stop. Why are the sunscreen ingredient
applications still stuck? The last time a over-the-counter
sunscreen ingredient was approved by FDA was in the 1990s.
And the third one is on medical gas, and I understand that
there is a regulation and certification of medical gas. But
that is still bumping around even though Congress fast-tracked
them in the FDASIA bill. Can you give me a sense of when the
FDA intends to finalize the regulations on this?
Dr. Hamburg. Okay.
Mr. Farr. And I have a few more, but I will probably just
put those in the record.
Dr. Hamburg. All right. Well, let me try to answer those
questions as succinctly as I can, although each of them has its
complexities.
MEDICAL GAS
On the medical gas, going backwards, we do have a
certification program in place, and in 2013 draft guidance went
out that outlined how we plan to administer the process. As I
understand it, there are now over 60 designated medical gas
products that have been certified, but there is still more work
to be done.
Mr. Farr. The problem is the industrial gases, which are
dangerous. I guess this process runs into that problem. And
these are for little personal packs that people carry--oxygen
you see a lot of, but other kinds of medical gases that are
trying to get fast-tracked get caught up in the industrial.
Dr. Hamburg. Well, this is obviously important in the
hospital setting and for individual patient needs. And it is an
area that we have been working hard on. It is one of many. We
talked earlier about the scope. It is incredible the range of
things. And we do not have the person power always to move as
quickly as we would want.
But this is an important and priority area that has gotten
more attention in recent years, and so we are working
diligently. And we have been working with medical manufacturers
and healthcare providers and other stakeholders as we address
the problem.
And we have conducted an extensive regulation review, and
we have had a public meeting with followup with stakeholders to
address it as well. So progress is being made, and you can see
in both the number of designated medical gases that have been
through the certification process and----
FEMALE SEXUAL DYSFUNCTION
Mr. Farr. What about the female sexual dysfunction?
Dr. Hamburg. Well, that is more complicated because the
male ones that you mention are talking about a very mechanistic
plumbing kind of issue. The female ones are looking at desire.
I do not know if that is quite the right word. But we are
talking apples and oranges in terms of the class of drug and
what the drug is trying to achieve.
And it is a harder scientific research question to develop
the product that really works. We are very open to
applications, and we have been working with one manufacturer
over time whose product has not yet met our standards for
approval in terms of safety and efficacy. But we would be
delighted if we saw more products in this area.
There are several products for painful sex, and that is
another important aspect as well. But it is an area where I can
assure you there is no prejudice against these products because
of the nature of the product or the population that would be
using them. It is a question of getting the science and the
understanding of how to address the medical condition aligned
with a product that really works.
Mr. Farr. But the bureaucracy is--you say it is apples and
oranges. But I think the concern that we have heard is just
that the protocols make it much more difficult.
Dr. Hamburg. They are very different products that you are
talking about on the male side in terms of how they work and
what is trying to be achieved. Of course, many of them--you
cited a large number; a lot of them are generics, not all new
molecular entities.
But I think the important point is that we want to work
with the consumer advocates and the stakeholder community,
healthcare providers, and importantly, industry and research to
try to advance the science to develop new and better products.
And we want to work with anyone who is developing these
products to help ensure the kind of research plan and studies
that could help us really assess if it is safe and effective
and appropriate for approval.
But so far, we have not seen a product that can make it
over the finish line. But we hope that we will, and we want to
continue to work on that.
Mr. Aderholt. Mr. Yoder.
Mr. Yoder. Thank you, Mr. Chairman.
BUDGET REQUEST
Dr. Hamburg, as we consider your budget proposal and some
of the increases in authority that you have asked for, new
personnel, I think it is really instructive of the impact that
passing legislation has in Washington; as we grow the scope and
responsibilities of your Agency, it requires more personnel and
more dollars to meet the demands that have been placed upon
you.
And I think that sometimes it is forgotten when we debating
bills on the floor, which is, what is the administrative price
tag? Who is going to administer this? What is it going to cost?
And I think Congress should take that into consideration more
often.
One of our biggest challenges on this Committee and in
Congress is how we reduce the impact of the national debt and
the ongoing Federal deficit in a town in which a $400 billion
deficit is considered by some a victory because it was much
higher than that before. And we know we have a lot of work to
do, and it is one of my top priorities and I know my
colleagues' as well.
And so we will give due consideration to your budgetary
increases, but we do so under the context of the larger
challenges we face as a Nation in paying some of our bills. I
do note that if we accept your budgetary request, personnel
will have gone up nearly 95 percent since you took over in
2009, starting at roughly 8,000-some personnel and ending up
with 16,000 personnel.
Obviously, we cannot be in the business of doubling agency
sizes at that rate all across government or even the FDA over
time, and so we have to figure out how to do more with less.
And the budget increases would be about 85 percent since your
time in your position. And if we had adopted the President's
budget submissions overall, the entire Federal budget would be
20 percent larger.
And so we may not be able to accept some of your requests,
but I want you to understand the larger context. And I think it
is also important for the committee to understand the growth in
the FDA. It has been larger than most agencies, and moreso than
certainly businesses and families have been able to grow at
home. We do not have a lot of businesses that have doubled
their employees over that time. So government cannot keep
outpacing private industry.
OPIOIDS
I wanted to ask you a little bit about opioids and the
issue related to prescription drugs. And I know that Chairman
Rogers raised this issue, and I know we are looking at
deterrent formulations.
And I guess I want to just know: Can we expect the Agency
to approve more abuse-deterrent formulations in the coming
months and years? Is the FDA facing any challenges to the
timely approval of abuse-deterrent formulations that the
committee should be aware of? And what is your work with
manufacturers? Are they struggling with any issues where the
FDA has been unable to provide clear guidance? What advice do
you give them, and are they interested in providing additional
abuse deterrence?
Dr. Hamburg. Yes. Well, this is a priority for us, and we
have been working very closely with industry, and the research
community more broadly, to try to stimulate work in this area
to come up with more innovative approaches and new strategies
to improve abuse deterrence and make these drugs less subject
to abuse and misuse.
We are finalizing guidance that really spells out for
industry, with greater clarity, what is our thinking and how
they should structure the studies that they do, and what we
will be looking for in terms of assessing their abuse
deterrence.
But one of the barriers is stimulating the science to come
up with these new approaches, and that is really, really key, I
think. Everybody recognizes that what we have now is better
than nothing, but it is not abuse-proof, and that it still
allows abuse through the oral--just taking the pills. And that
is the most common source of significant medical complications
of prescription opiate use. So it is an ongoing process. But we
have been very actively involved, working closely with industry
to try to stimulate new work.
Can I just say something on your other, or is that stepping
on----
Mr. Yoder. Absolutely. Sure. No, please.
Dr. Hamburg. I just want to say, I appreciate completely
where you are coming from. But I think it is really important
to understand that the world has changed dramatically in recent
years. And part of the task that I had as FDA Commissioner was
really to make sure that we were positioned to fulfill our
promise to the American people in a world where science has
been advancing so quickly that we needed to be able to
appropriately and efficiently regulate the products that come
before us.
And globalization has just shifted everything. There are
several hundred thousand facilities around the world in more
than 120 countries making products that are coming into the
United States. And we have to be able to know that those
products are being made according to the standards that we hold
American companies to and that the American people expect.
So this has been a very unusual time. I do not think anyone
would anticipate the continuing transformation in terms of
expansion of FDA. We got new authority for tobacco products,
which of course is a whole new enterprise that has caused us to
grow by more than 500 people in recent years.
But in terms of what we do and our impact on Americans and
what we are asking the American people to pay, it is about
eight dollars a year per American to support FDA activities. A
very large and increasingly large percentage of our budget is
coming from industry because the industry actually does see the
value of a modern, efficient, smart regulator. So they, through
our user fee negotiations, have been putting money into our
programs and activities, and they hold us accountable for
appropriate use of those monies.
But I think this is really important to understand, and I
think it is really--we do actually represent good government at
its best in many ways, and reflected in the Gallup poll.
Mr. Yoder. Well, Mr. Chairman, if I might just conclude.
And I think that is why you have seen your Agency grow 95
percent in terms of personnel over the past seven years. I just
make that point so we understand Congress has answered the
requests and has answered the call and has put the resources
forward. And industry has done so as well with the relationship
that has been created.
Sometimes we get in this Committee and we say, oh, we are
cutting these agencies and we are slashing them. We are not
giving them resources. I think most Americans would say,
consistent with the points you just made, that almost a
doubling of the size of personnel over seven years is Congress
answering that call.
And I also make that point to recognize that we cannot
continue that pace. All right? We are not going to be----
Dr. Hamburg. No. We are looking for efficiencies and taking
some cuts in this budget.
Mr. Yoder. And I appreciate that. 8,000 to 16,000
employees, I cannot imagine seven years from now we will be
talking about 32,000 employees.
Dr. Hamburg. No, no.
Mr. Yoder. So that has been a real J curve on that pace
that we will not be able to keep up, and that is just good for
all of us to know.
Dr. Hamburg. And I believe it.
Mr. Yoder. Thank you, Doctor.
Dr. Hamburg. And fully appreciate the support you have
given us in these recent years.
Mr. Yoder. Thank you, Doctor. Thank you, Mr. Chairman.
Mr. Aderholt. Mr. Farr.
SUNSCREEN
Mr. Farr. Can you finish the sunscreen discussion? And
maybe what you think the feeling about the Ebola versus
measles.
Dr. Hamburg. Well, on the sunscreen, just to try to be
brief, you, I think, said that progress has stopped. It has not
stopped. It was too slow before. Congress passed the Sunscreen
Innovation Act and gave us a new framework with more clearly-
defined timelines for reviewing sunscreens in an effort to make
a product that is really important more available in terms of
the addition of new ingredients.
We are systemically now looking at a number of
ingredients--there are eight in all--in terms of their use in
over-the-counter sunscreen products. And we are asking the
companies for data to support the safety of the use, the
chronic use, of these products.
But we are committed to moving forward. We actually have
redirected some of our limited resources to focus more
attention on moving these reviews. We have to work very closely
with the companies involved to get the data that we need to
assess toxicity, which is not a trivial issue.
People may think, what is sunscreen? It is used more, and
that is a very good thing. And it needs to be effective to be
used in a fairly substantial quantity. People use it a lot, and
it gets absorbed into the body. So we do have to think about
chronic----
Mr. Farr. Is it being stuck because of the industry not
being able to provide the information you are asking? Or is it
stuck because of not enough personnel and time dedicated to it?
Dr. Hamburg. Well, at the moment, with respect to these
eight ingredients, I think that we are working with the
companies to indicate to them what kinds of data that we need.
And as soon as we get that data, we will embark on a rapid
review with the right personnel mobilized to do those reviews
and to meet the timelines that were put forth in the Sunscreen
Innovation Act.
EBOLA/MEASLES
Mr. Farr. How about the Ebola/measles?
Dr. Hamburg. I think Ebola is really scary because it is a
disease that most people do not know much about. And in recent
experience, it has a very high lethality rate and a very
horrifying mode of death. So I think people panicked. I think
the risk to American citizens were always much lower, but it is
understandable why there are concerns.
I think we are too complacent about many, many infectious
diseases. And I think that many have come to believe that in
the era of vaccines and antibiotics, that the era of infectious
diseases is over. Ebola is scary because there is no vaccine or
treatment. People know what measles is and they think, well,
how bad can it be?
In fact, measles can be a very deadly disease, and if not
deadly, it can have lifelong damage associated with measles.
And we have a safe and effective measles vaccine. But I think,
frankly, we have been complacent. Too many parents have chosen
not to vaccinate their children because they felt that the
risks of the vaccine were much more serious than they were, and
that the risk of getting the disease was almost marginal.
But we know that when vaccination rates go down and there
is measles in a community or introduced into a community
because of the amount of travel that occurs, including to other
countries where measles is much more endemic, it can reignite.
And we have seen that, and we have seen the devastating
consequences of it.
So I think we need to continue to educate the public. We
need to continue to ensure that products that can make a
difference in the health and safety of people are taken up by
the medical community and understood and accepted by consumers.
I think it is a teachable moment for this country about the
importance of vaccination against preventable disease.
Mr. Farr. Good point. I hope you can speak out about it. I
think putting it in some kind of context with Ebola is very
important. I think the consumer now is always comparison-
shopping, and how bad is this? And just the scare is not
enough. It is what you are talking about. We seem to have
downplayed things that we can treat versus things that we
cannot treat. And maybe what we can treat is actually more
serious than what we cannot treat. Thank you.
Mr. Aderholt. Ms. Pingree.
Ms. Pingree. Thank you, Mr. Chair.
Thank you again. You have put in a long day and had a lot
of very diverse questions, so I appreciate all your answers.
Let me just bring a couple more points up.
FSMA
I know I have spent a lot of time talking with Mr. Taylor
and others, and appreciate the focus you have given to the Food
Safety Modernization Act. Representative DeLauro has brought up
a lot of things about the quick implementation of the rules.
And I have spent a lot of time looking at how they are going to
impact some of our farmers and especially small- to medium-
sized farmers.
I am very grateful for the fact that Mr. Taylor took a trip
up to Maine and some of the other New England States to hear
from a variety of people about their issues. And I know you
have been doing a lot of work since then.
The only thing I wanted to bring up--and I think this is
already known since I have made some comments about it. The
revised rule, which does more clearly reflect some of the
actual issues around farming, and does improve guidance on
manure and compost. Some things that I think sound scary to the
consumer on the outside, but the use of manure on a field or
making sure there is more wildlife in the field is just a big
part of a healthy ecosystem.
But the water rule still has some issues. And I think
people are very concerned about whether or not the water
quality metrics upon which the FDA is relying are still too
stringent to be realistic for farms. For example, irrigation
water is being held to the same standard as water used for
recreational use, like swimming.
So I am hoping the FDA will commit to pursuing a more
practical water standard for agriculture that can be updated to
reflect advances in science. I do not know if there is funding
being allocated for the research on appropriate water
standards, but that seems important to me.
Do you have an estimate of the cost to the farmer for the
water test? I hope that there is some flexibility in making
sure this is not overly burdensome and prohibitive for some
farmers. I realize you may not have all these answers on the
tip of your tongue, but since this is a big topic of interest
to many of my constituents, I wanted to put it out there.
Dr. Hamburg. Well, I think, most importantly, we are still
assessing a full range of comments that we have gotten on the
proposed regs, and we will be moving towards finalization, as
you know. But I hope and trust that you have submitted some of
these comments to us as part of that process, or others that
share your concerns you no doubt have. And certainly we are
listening today.
Ms. Pingree. Great. Well, we will certainly be keeping a
close eye on it, and do appreciate the amount of listening that
has gone in. But that is one of the concerns that people still
have.
Let me just pass along one last question that
Representative DeLauro did not get a chance to ask, but I will
put it out there in the mix and you can either reply to her or
to all of us.
TANNING BEDS
She is concerned about, as I think many of us are, tanning
beds. She wants----
Dr. Hamburg. It would not be a budget hearing if Rosa did
not ask me about tanning beds.
Ms. Pingree. There you go. So I do not even know if I need
to explain to you that there are concerns about the high
exposure which happens more commonly in teen and over-exposure
in childhood. We all know that those things increase your
chances of developing skin cancer.
And tanning bed companies aggressively target girls. Ten
States have forbidden tanning bed use by children under 18
years of age. Forty-one States regulate use of tanning
facilities by minors. And I guess we all want to know if the
FDA is going to do the same.
Dr. Hamburg. Well, we have up-scheduled tanning beds to put
them in a category of medical device where they have more
oversight, and also have required a black box warning on their
use that includes a warning against people under the age of 18
from using them.
We are also trying to finalize some other--I do not know
if it is a guidance or a rule--proposed rule. So we are trying
to put forward a proposed rule that would more specifically
address some of the Congresswoman's concerns. But that is still
in process and hopefully will be available, maybe not before I
leave but soon thereafter.
Ms. Pingree. Great. Well, thank you again for your
comments today.
MENU LABELING
Mr. Aderholt. Let me switch gears and talk about Menu
Labeling. As you know, the FDA published the final rule for
nutrition labeling of standard menu items at chain restaurants
on December 1 of last year. Since fiscal year 2014, Congress
included report language instructing FDA to not expand the
final regulations to supermarkets and grocery stores. Yet in
the final rule, FDA disregarded this instruction and not only
regulated chain restaurants but also supermarkets, grocery
stores, convenience stores, gas stations, and a whole host of
other retailers.
My question would be: Can you explain why FDA chose to
ignore the explicit statements accompanying the appropriations
bill and expand the regulations even further?
Dr. Hamburg. Well, I think that we were following what
was put forward in the law in terms of oversight of restaurants
and restaurant-like establishments with chains of 20 or more,
as well as vending machines. We tried hard to be very
thoughtful and careful and mindful of some of the kinds of
concerns that you were expressing about what were the
appropriate places for Menu Labeling.
But in some instances, the law was very specific about when
there is a menu board and it is restaurant-type food that is
prepared for consumption in individual-sized portions either
onsite or for consumption as you are leaving or soon
thereafter.
So, for example, in the grocery stores, which I know has
been a place of some concern, we tried to very clearly limit it
to the components of the grocery store where there is a mini-
deli kind of a setting or a salad bar-type setting, which is
explicitly in the law for coverage, and for the deli, where
there is a menu.
So if it is a ham and cheese sandwich that is prepared and
there is a menu, then it would apply. If you are buying a pound
of ham and a pound of cheese and a loaf of bread, that would
not be subject to our oversight.
So I think now that we have finalized the Menu Labeling
rule, what is incumbent upon us is to work closely with the
different stakeholders to achieve the most efficient way to
implement and the greatest clarity about what the expectations
are and how to do it.
We have been working closely with FMI, that represents a
lot of the chain grocery stores, to really find out what are
the things that are difficult about implementation and how can
we address them, including doing a walk-through recently and
looking at the different types of food and what would apply, et
cetera. But we want to work with stakeholders in order to
implement this and to comply with the intent of the law.
Mr. Aderholt. The FDA's final rule mandates that
approximately 300,000 restaurants and similar retail food
establishments comply with the rule by December 1, 2015. The
Agency provides a December 1, 2016 compliance date for similar
rules released simultaneously that apply to foods sold through
vending machines.
We have heard from a number of our constituents that are
awaiting clarification from the FDA on many of these unresolved
questions, and they are expressing serious concerns about their
ability to comply with the Menu Labeling regulations by
December 1, 2015.
FDA has yet to provide regulated industries with additional
compliance time as they await forthcoming guidance that is
increasing the likelihood for errors, further corrections, and
higher compliance costs due to the uncertainty.
As I mentioned in my opening statements earlier this
morning, FDA has to be aware of the comprehensive costs of
regulations overall. In a vacuum, these regulations may be very
logical and relatively easy to comply with. However, the
Federal Government is forcing major cost on the industry from
numerous sectors of the government and in aggregate places
undue cost on these businesses.
Granted, the Food and Drug Administration extended the
implementation date beyond what was proposed. Why did FDA only
allow for one year?
Dr. Hamburg. Well, it is one year for restaurants and
restaurant-like establishments, and two years for vending
machines. But I recognize what you are saying, that the clock
has already started ticking on the one year, and the guidances
are not available.
We want an orderly, realistic, and effective implementation
process. That is why we are working closely with FMI, as I
mentioned, and others. So we need to give them guidance. We
need to work with them and hear their concerns. And we need to
be, as I said, orderly and realistic about how we go about it.
Mr. Aderholt. Would you support FDA extending or delaying
the compliance date of the final menu labeling regulations
until at least December 1, 2016 to provide the regulated
entities----
Dr. Hamburg. Well, I am not going to comment on that, and
it will be someone else's decision as well. But I think what I
am saying to you is that we want this to work. We want it not
to disrupt industry but to enable industry to put in place an
informational system that actually reflects, I think, what a
growing number of consumers are already asking for. And of
course, some companies have already moved towards doing this.
So we are right now in a stage of really trying to--now
that the final rule is out and these institutions and companies
know what they are dealing with, we now need to work with them
to understand, what are the barriers to implementation? What
are the areas that need greater clarity? And how can we assure
the right implementation so that it works?
Mr. Aderholt. Well, there is a great concern out there,
let me just reiterate, because we are hearing--because of the
impact of this language and the impact it has on them.
Dr. Hamburg. Yes. Well, we do understand. I think I have
said to this Committee before that when I first learned of this
new responsibility for the FDA, I thought it was relatively
straightforward. It turned out to be one of the most complex
undertakings that I have been involved in in my tenure, and so
I understand why industry is concerned and why there is anxiety
about what does it mean and how do we implement it. So we get
it, and we are going to work closely with them to assure a
smooth implementation.
CHINA
Mr. Aderholt. Last year our Subcommittee had raised some
serious concerns about China creating delays and obstacles in
the process necessary for FDA officials to gain visas into
China and to allow them to inspect the facilities. In fact, it
is my understanding that things were so bad that Vice President
Biden reportedly had to negotiate with the Chinese on the visas
in China to exchange for China visas in the United States. I
understand there is some progress that has been made, but the
progress that has occurred so far is really not that
acceptable.
In December of last year, the FDA entered into two
implementing agreements with two agencies in the Chinese
Government as it relates to inspections. According to the
agreements with China, can U.S. inspectors, either based in
China or on detail in China, inspect a Chinese facility without
notifying the Chinese Government?
Dr. Hamburg. Yes, we can. We often, though, do work with
these Chinese inspectors because I think it is a way of helping
to train them to better understand what is expected in terms of
our standards and quality concerns. And what we are trying to
do is both achieve the necessary inspections and also help
create a more rigorous oversight system in China in broadly.
And why having offices in China is of great value is that
we are able to work with our counterpart regulatory authorities
on the medical product and the food side, and also to work with
industry because industry can help drive this process as well.
So we are making progress. We have the ability to get the
visas that we need. We are staffing up. It does remain a
continuing challenge for us to recruit the right FDA employees
to live and work in China, India, other places where living can
be more challenging in other ways.
But we have been able to carry on a lot of inspections, not
just with the people that are actually physically working out
of our China office, but using that office as a hub for other
inspections to go on. We send people for 30, 60, 90 days, or in
some instances if it requires specialized expertise, someone
may go over just to do a couple of inspections.
But we think the ability to do unannounced can be very
important. But we also want to use inspections as an
opportunity not do to a ``got you,'' but to work with our
counterpart regulatory authorities and industry to identify the
kinds of concerns we have and fix them so that the company can
do a better job going forward.
Mr. Aderholt. And I understand the working with them to
try to help them to understand what the concerns are. But the
bottom line is, you are saying that unannounced inspections,
surprise visits, we can do that?
Dr. Hamburg. Yes.
Mr. Aderholt. Without notifying the government ahead of
time?
Dr. Hamburg. Right. And the other thing--this, I think, was
in FSMA; someone may need to correct me--but we now have the
ability to refuse entry of a product if we have not been
allowed to go into the facility to do the inspection.
Mr. Aderholt. How many permanent FDA inspectors with visas
do we now have in China?
Dr. Hamburg. Right now we have eight staff in China, with
five more pending. As I said, we also use those offices as a
hub to support inspections with people who are not actually
living and working in China. But this gets to the broader issue
we were discussing. This is obviously a critical need.
There are many, many manufacturers in China on both the
medical product and the food side that we want to know more
about, that we want to be inspecting regularly, where we want
to make sure they are meeting our standard for the protection
of the American public. Yet it is much more costly for us to do
those inspections overseas.
So we are working hard, in keeping with the mantra you
laid out at the beginning of your remarks, not only to
strengthen our presence there, but to also try to raise
capacity through working with our counterparts in government
and industry, and also working with our counterpart regulatory
authorities from regulatory agencies around the world who share
this problem.
We have the biggest burden because of the volume of
products coming from China into this country. But the European
Union, Canada, Australia, Brazil, all are getting products from
China, and they are not able to cover the waterfront in terms
of inspections, either.
So we are working on how can we leverage each other's
inspections and information and intelligence about what is
going on to enhance our overall knowledge of product quality
and safety.
Mr. Aderholt. So currently there are only eight permanent
inspectors in the entire country of China?
Dr. Hamburg. There are eight staff in China.
Mr. Aderholt. How many food and drug inspections were
conducted by the United States inspectors versus how many were
planned?
Dr. Hamburg. I think that we conducted the ones that were
planned, and some that we had not plan but that were done for
cause. In terms of the exact numbers, you want international
numbers for all inspections done of all----
Mr. Aderholt. U.S.
Dr. Hamburg. So inspections done domestically?
Mr. Aderholt. Yes. How many were--I am sorry. It would
also be helpful to know also China as well. How many were
conducted by inspectors, yes, in China, by United States
inspectors versus how many were planned and how many were----
Dr. Hamburg. There were, I think, 456 total inspections
that were done in China in the last year. As I said, we do gain
some additional situational awareness from exchanging
information with counterpart regulatory authorities.
But obviously, there is more work to be done. And again, I
am often asked, what are the issues that keep you up at night?
Well, being able to respond to the globalized marketplace to
ensure import safety is one of those issues for me. So I
appreciate your interest, and I think it is one of those areas
that explains why we have had expansions. But we need,
actually, still more.
We have adopted other strategies to address some of our
import safety concerns, including more risk-based and
information technology-driven screening at the borders so we
know where to set priorities and target resources. But that is
also a huge challenge because we have got more than 300
different ports of entry--water, truck, airplane, train. And
the volume of products coming over our borders has, I think,
quadrupled in the last decade.
So we are scrambling. And one of the things that I am proud
of is that we have really repositioned FDA to address these
challenges of the globalized world. But there is more work to
be done.
Mr. Aderholt. Well, I think just the mere fact that we do
so much trade with China, and especially regarding more and
more food, I think the increased visibility of inspectors, food
inspectors, U.S. food inspectors, is important. And I think
that is something that FDA needs to take very seriously.
Well, thank you. I know we have gone on now for quite a
while, and appreciate your testimony here this morning. I know
this is your last testimony before the Subcommittee, and we
could draw it out all afternoon, probably, with different
questions.
But we do appreciate your testimony, your work, and your
service to the Food and Drug Administration. And as my
colleagues have said, we wish you the best in your further
endeavors.
And at this point, the subcommittee is adjourned.
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W I T N E S S E S
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Page
Alonzon, Anne.................................................... 527
Avalose, Ed...................................................... 527
Cochran, Norris.................................................. 247
Hamburg, Margret................................................. 247
Johansson, Robert................................................ 1
Mitchell, Larry.................................................. 527
Shea, Kevin...................................................... 527
Tyler, Jay....................................................... 247
Vilsack, Hon. Thomas............................................. 1
Weller, Jason.................................................... 363
Young, Michael............................................. 1, 363, 527