if anyone has an electronics, if he can put those on silent mode, that would be helpful. we understand we may have folks that may be called over the next few minutes. take questions or take your statement as long as we can, and then we will do a temporary adjournment. so everybody is welcome to come back after the vote to proceed. secretary feel sack, without objection, your written testimony will be included in the record. thank you, again, for being here. members of the, committee, thank you very much for the opportunity to be here this morning. let me start by focusing on the impact of this budget on real people. 85% of whichs, will be beginning farmers or socially disadvantaged farmers, will benefit under this budget. crop insurance will cover $63

billion in crops. billionl protect $165 in livestock, poultry, and specialty crops as a result of this budget. ag will continue to support $140 billion in agricultural exports which helps to support one million jobs at home. the food and nutrition assistance programs will benefit nearly 47 million americans under the snap program. 8.7 women, infant and children under the wic program. thellion children under summer feeding programs. the food safety budget will provide assistance in detecting our food supply and reducing foodborne illnesses by estimated 52,000 illnesses. nrcs will provide conservation assistance that will add 23 million acres of land to our conservation programs, helping

half a million producers do a better job of conserving soil and protecting water. while it is not related to this budget, it does have an impact on this budget. our overall budget will also million acres of forest and grasslands under the u.s. forest service, which will protect 70,000 communities that are located within the urban wildland interface and the 45 million homes that are located in those communities. rural development will help support, create and retain 44,000 jobs with the investments we make. utilities will provide additional, improved electric service to 4.6 million. 2.2 million people receive better water and sewage facilities. 00 households and businesses will benefit from expanded broadband access. 66,000 people will have to the

dream of homeownership as a result of this budget. i think it is important to point out that the budget authority that we are requesting in terms of housing is actually increased. the problem and challenge is that interest rates have driven up the cost of borrowing, which is what will be difficult for us to reach the program levels in the past. this is not a situation where we are cutting. it is a situation where the cost of lending is a little bit increased. people will benefit from community facilities located in their communities improving. these might be police and fire stations, hospitals, levers, or schools that we invest our community facility resources in. and our research facilities will help to support nearly 100 research facilities in the agricultural research service that are currently involved in 800 research projects that over the last five years have 383orted 215 patents and licensing agreements which leads to jobs and small business growth. the nifa competitive grant

program is helping to support our land grant universities, our historic black colleges and universities, our hispanic serving institutions, and are troubled colleges and universities. this is about results. we are focused on results. we are also focus on reforms. this budget performances -- proposes a number of reforms, including modernizing our farm service agency offices so they can better handle the challenges that farmers face by providing a bridge to additional opportunities. we will also continue to focus our efforts and reform on our rental assistance program so that continues to support the 285,000 families that benefit from our rental assistance program. thated to right size program and we need additional tools to do that. given actions taken by congress in the past that have now

created a challenging situation for us to fit rental assistance within existing budgets. we will continue to look at ways in which we can improve our services through a series of reforms better outlined in this budget including the development who's focusorps. the job will be to look at the areas of most persistent poverty and to amplify the strikeforce initiative that chairman rogers alluded to. this budget will also focus on opportunity. the ability to significantly expand local and regional food systems as an alternative for small and midsize producers. additional new market opportunities for them. we'll also take advantage of the new farm bill that passed. that creates an opportunity for us to expand rural manufacturing. 14% of american manufacturing is related to food and agriculture.

we want to expand on that with a bio-based product opportunities the "farmville" presents. this bill also focuses on innovation. three innovation institutes microbialn anti- resistance, pollinators, and the bio product manufacturing will help in reserving our agricultural production and expand new opportunities for agricultural products. and we will also focus on an effort to do a better job of addressing the challenges the poultry industry faces with disease. we have antiquated facilities, which is frankly true of our anti-agricultural research entire -- of our agricultural service. we have to address our infrastructure. one way to look at that is to look at our unobligated balances, allowing us to retain

those balances and use them to upgrade our facilities. this would also give us an opportunity to better manage and perhaps reduce the 70 million square feet of space we currently operate, lease, or own. as i shared with you earlier yesterday, mr. chairman, i think there is an opportunity for us to save resources by right sizing our rental properties within the capital area and improving our lab facilities. to do that we need a resource that is predictable and one we can budget from. that has been difficult to do. so that's the roi of this budget. reform and results, opportunity and innovation. i want to point out the this budgets discretionary sentence is half a billion dollars less than it was when i became secretary. i think we will continue to try to manage this budget in an appropriate way. commentsional specifically relating to comments you made, mr. chairman. we are proud of the work we're

doing on snap integrity. you mentioned the combined fraud rate of 4.07%. that is at record lows. and it needs to be pointed out that we have aggressively pursued integrity in these programs. last year, 40 2000 individuals were disqualified from the program. 1200 businesses disqualifies. investigations work conducted. we are proposing additional resources not only to improve our integrity efforts but to focus on the other programs including the crop insurance program where the error rate is ain excess of 5%. we think we are doing the job in terms of oversight and integrity. i would say that we are working very hard on securing our systems, significant improvement have been made. when i became secretary, we had

17 e-mail systems. we now have a single e-mail system. billionpart of the $1.2 we have saved through our administrative services process and who prefer stronger service. so i look forward to responding to the questions the committee has. these are difficult budget times, but there are significant results that come from this budget and we're going to work hard to make sure the people of rural america are served well by the usda. >> thank you, ms. or secretary. -- mr secretary. we will proceed on. it will be another 15 or 20 minutes before we have any votes. so we will proceed as long as we can and then we will return after the votes. let me start out with something that was in the f.y. 14 on the bus. light which was included to usda to establish a waiver process for schools that are finding the invitation

of the school breakfast and the competitive food regulations rae are too costly. i sent aklein and letter asking that you act quickly to put this waiver in place. i would like to enter into the record of letter from the school nutrition association supporting the waiver. let me just say, one of the paragraphs in here from the school attrition association says "since the passage of the foodkids act, school authorities have continued to take great pride in providing students with helpful and tasty meals to more than 30 million students each school day. however, the yearly changes have undue administrative burden on operators and industry alike. thus, a waiver will allow certain schools the option to have more time to prepare their district schools and students." i know you have sent a letter to us

i just received it before i walked into the hearing so i had not had chance to look at that, but could you tell me about how you could possibly implement a waiver? >> i appreciate the question. it is important to point out the school district have received centenefit of a six increase as a result of the healthy and free kids act. we respect very much the directive from congress. 90% of school district across the united states are being certified in terms of their participation in the act and the nutritional standards improving. we are focused on the 10% that are having a bit more difficulty. we want to help those 10%. russell national school act makes it impossible for us to provide the waiver you have requested. by express language in that statute, we are prohibited from granting a waiver. i'll quote, "the secretary may

not grant a waiver undnerer that increases federal costs or that relates to a, the nutritional content of meals served, and the sale of competitive foods." your letter was attracted to the breakfast program and to the sale of competitive foods. we are trying to help the school district. we recently announced $5.5 million in grants under are smarter school lunch room program. this is going to provide $50,000 to each state to assist in competitive grants up to $350,000 for district and for schools associations and for department of education to assist and help the other 10% of schools that are having a more difficult time. where there has been an opportunity for us to be a bit flexible, as is the case of protein content of meals, we have been able to do that. we propose initially some changes. we then made those changes in terms of protein content and

portion size per minute. -- permanent. we will continue to look for ways to help the 10% of schools having a difficult time, but unless this law changes, mr. chairman, i do not think i have the authority to be able to do what you would like us to do. >> needless to say, we are getting feedback from our schools that they want to see some kind of waiver. chschools are searching for some type of relief, but i do note th at the farm bill expressly prohibits usda from advertising and recruiting for sanp. but you were quoted as saying that we will find a way to make sure that people know about the program. my question, if you wanted to, i think you could find some creative ways to be implement this waiver. intent of the language is not to permanently waive the standards and requirements of the law. it is a process to delaying to

have more schools to comply with regulations. in fact, usda provides a similar delay for the breakfast requirements when it issued the final regulation on the new school meal standard. rulete, "the final provides additional time for the implementation of the school breakfast requirement and modifies those requirements in a manner that reduces the estimated cost for breakfast changes as compared to the proposed rule." mr. secretary, these challenges are not going away, and i would hope he would work with us to find ways to help the school cafeterias. >> mr. chairman, i think we are willing to find ways. and we will be happy to work with this committee and with you to look for ways. i think the law is pretty explicit as it relates to the waiver of the program in terms of nutrition standards and competitive foods, but we're more than happy and i think we have shown in the past a willingness to be flexible. i would point out, i think the

snap situation is a big difference in food because there is a difference between educating and advocating. i think what congress was attending to tell us is that you did not want us to incent or encourage recruitment of people to go out and search for people to qualify for snap. i am not sure that you intended to prevent us from educating people about the existence of the program. one of the concerns we had about the program is that when i became secretary, only 52% of eligible folks participated because a number of states were not really doing a very good job of letting folks at least know that the program existed. today, that participation rate is 80%. so i think we will work with you abilities and on flex within what ever statutory responsibilities we want to gather him up because i am hearing a great pushback and it is a very real concern out there among schools. they are very concerned about

it. to youto relate that because as a representative and hearing from the school cafeterias, they are very, very concerned. >> thank you. i think i will follow-up on your question. there is a lot of concern, and it is because, frankly, if you look into the law as i have on our idea of getting nutritional food to children in this country, is absolutely a smart thing to do. the problem is congress has micromanaged his program where every child who walks into the cafeteria has to first of all be means tested. you do not do that when they get on the bus or when they walk into the library, but if they walk into a food area, they have to be means tested so we can tell which kids get free or reduced lunch payments. then we go on to dictate the portion size, the nutritional content. we even last year when so far, because of the potato lobby --

special interests, the potato lobby here, this congress ordered you worked out sort of mitigated the language between the senate and the house, to figure out how to make white potatoes as a wic food program as a nutritional item. and i think we asked you, in our legislation, the language saying we expect of you to amend the rules governing wic program to include, in effect, white potatoes in the wic food package. we asked for a report from you, if you chose not to amend the rules. and i think undersecretary kincannon recently sent us that report. i suspect that we're going to be back here with the same members of the committee saying they didn't win last year, they're going to be back again this year, and i just wondered, we never got a chance to hear your viewpoints after this committee had done its work. it was in the full committee.

what are your views on this issue? >> well, congressman, i think it's important to point out that we approach the institute of medicine to ask for advice as to how to structure a wic program that would provide supplemental assistance and nutrition for women, infants and children. they took their job very seriously, they made a set of recommendations, and the recommendations were that we should focus on nutritious choices in food products that would not normally be purchased or not normally be used by women, infant and children. the issue with potatoes, white potatoes and potatoes generally is the average american consumes almost 90 pounds of potatoes a year. >> what's that? >> almost 90 pounds of potatoes a year. the average american consumes almost 90 pounds. like 88.7 pounds of potatoes. so the institute believed that it would be appropriate to focus on vegetables that weren't consumed in quite the same level

of quantity, and so they suggested and proposed and directed us to focus on green, orange, red vegetables. which we have done in the wic program. the report that undersecretary kincannon provided essentially says we have nothing against potatoes but this is a supplemental program. this is supposed to supplement what people would otherwise normally buy. and that's why potatoes were not included. and why we focus the wic package on more nutritious alternatives that are not normally purchased by women for their children. so, it's really based on the institute of medicine recommendation. now the potato folks say whether there's additional nutritional information, fair enough. we have asked the institute of medicine to sort of accelerate their review. they do this periodically accelerate the review and if there's additional information or new information that's come to light we'll certainly take that into consideration. but at this point in time this is really a focus on what will supplement and complement what people are already purchasing.

>> in getting back to the schools lunch programs and the school feeding programs, could we have use the appropriate technology, you've talked in -- about sort of streamlining the management of rural fsa offices and combining them through electronics. is there a way where we could essentially, if we have to -- if we're not going to changed microrequirements of measuring each child each day for the amount of food they get and whether it's nutritional food could we begin sort of a bar code system so that things that the chairman are talking about where the servers are -- they're just overwhelmed by the amount of work they have to do, and the limited amount of money they have. can't we use smart technology to sort of portion size and make sure that the child who is receiving that proportion is also all those records are kept electronically? >> well, i think a couple

things, congressman. we are obviously very anxious to work with technology advances to modernize our programs. it is an issue of resources, obviously. we are -- we think the first order of business is to help schools better equip themselves to be able to produce food on site, which is why we've had the school equipment grant program nearly $200 million has already been granted out to schools to improve their equipment purchases so they can actually produce food on site. we've also recently launched the community eligibility program. currently roughly 3300 school districts representing 22,000 schools and several million children currently, because of the high level of poverty in their school district, rather than forcing them to go through this process of deciding who gets free and reduced lunch and who doesn't, essentially everyone is considered and deemed to be part of the free and reduced lunch population, so it saves the school district the administrative expense, and the

cost, and ensures that every youngster who should be participating in the program does. that may be an opportunity to take a look at that process, and to determine whether or not that would be an easier way to administer these programs. so we are looking at ways to streamline. we are looking at ways to improve equipment. and we'd be happy to work with you on other ideas. >> thank you very much. appreciate. my time. thank you mr. chairman. >> mr. rogers. >> thank you, mr. chairman. mr. secretary, let me ask you about the s.n.a.p. program. in your budget request, you propose that we spend $104.7 billion for food stamps. that's 3.3 billion dollar increase in one year. i'm told that there's some 49 -- 47 million participants per month.

and whether you call it education or recruitment, there are people out there, from the government, that are aggressively seeking out people to sign up. and let me ask you, where in your budget request do you have moneys for, quote, education, unquote? >> mr. chairman, we provide several hundred million dollars to states, through the education and training part of the budget, that provides them resources to do several things. one is to make sure that those who are eligible are aware of the existence of the program. and to work with us to do a better job of connecting the 8% of snap beneficiaries that are able bodied without dependents, to be able to access work opportunities if they're aware of jobs that are available.

one of the great opportunities, i think, that the farm bill presents is the ability with the pilot programs authorized in the farm bill for states and for us to do a better job of connecting those able-bodied folks to work. i think that will result in a decline in the number of people currently receiving s.n.a.p. and we anticipate and are projecting a decline because of the improving economy. >> well, you know, the farm bill is pretty plain. the language is as blunt as you can put it, i think, that no money shall be used for the purpose of soliciting, advertising and recruiting for s.n.a.p. and you call it education. but i think the intent of the bill, and for all practical purposes, is a prohibition. >> mr. chairman, i think that you're correct, there is a prohibition towards using resources to hire people who would go out and who would be

paid based on the number of people that signed up the program. i think that there were concerns expressed about that practice that some states utilized. and i think it's important to point out that states administer this program. and so so many decisions that are being made in terms of how to recruit, versus how to educate, are being made at the state level. >> but certainly, surely the u.s. department of agriculture has the capability by regulations to tell the states what they can and can't do. >> well, we do. and we are working with them. part of the problem, mr. chairman, is that there are some folks, when they get in to a position in state government where they are happy to have a program, they just simply don't want people to use it. and that's what we found when i came in to this office. we found a number of states where the participation rate in s.n.a.p. was woefully inadequate. there were a lot of people who qualified for this program who simply didn't get in the program. and the question -- i think the key here is, as long as the

qualifications are what they are, i would hope that we would want in a perfect world everyone who is qualified for the program using the program, and participating in the program. as opposed to obviously nobody wants people that aren't qualified to be participating in the program. that shouldn't happen, to the chairman's point about integrity and mistakes and so forth we obviously want to continue to reduce those. >> well, this item in the budget, $104.7 billion out of $144 billion, 80% of your budget is going roughly for the food stamp program >> well, mr. chairman, could i put this in a slightly different light, if i could. first of all, i think it's important to understand who gets this perk. 92% of the people receiving this program are senior citizens, people with serious disabilities, children, or those who are actually in the workforce who are struggling because they've got a minimum wage job, or they have a

part-time job. so it's helping a substantial number of people who i think are playing by the rules. secondly, this is part of the overall effort to stabilize prices and so forth in terms of agriculture and the economy, because if people can buy more in the grocery store what we do know is they do, indeed, buy more. and it is clearly an anti-poverty program that is effective. records would show that this s.n.a.p. program helps to reduce the poverty late, it helps to reduce the severity of poverty that folks face. i think it's a successful program. the best way to reduce the number, the best way to reduce the number, is to do a better job of linking people who are able bodied who can work and should work to jobs that we know are out there. and we do need to do a better job of that. and i think the farm bill gives us an opportunity to do that. >> thank you, mr. chairman. >> the vote has been called, but i want to answer miss recognize. we have several minutes before we have to go. >> a quick question.

frl following up on some of your comments. the budget requests $30 million to continue to program to provide money to food for poor children during summer months when they're not benefitting from school feeding programs. there were very encouraging results for the pilot program at a modest cost of about $60 per child a month using existing with or snap ebt programs. the budget proposes to either continue the demonstrations in the same area or go statewide in some smaller states. i know it would be very helpful in new york. i think it's an important program. can you tell me what you have learned from the existing demonstration program? what dro you hope to achieve with the 2015 budget proposal? >> congresswoman, there are 20 million youngsters on free and reduced lunches in the country. in the summer months it reaches 3 million.

there's a significant delta. we want to figure out ways to improve the nutritional opportunities to the youngsters. we know it's linked to their health and exal achievement. so this program has essentially focused on 100,000 youngsters. it's ramped up over the period of the last couple of years. it provides 60 bucks a month to the youngsters in additional food. it helps to reduce food and security among the population by 30%, which is a fairly significant number. what we would like to do is ramp this up. we think we can still get the same kind of benefits, even if the overall amount is less than $60. we think we can still get significant benefits. but we would like to expand it. we would like to see what this would look like on a statewide basis.

iz. we newsed them in the summer programs, the winter programs. we'll talk further about it. thank you very much. >> okay. again, we apologize for the votes. as you know, that's out of our control. so we will take a recess for about 25 minutes, and then we'll reconvene. and so thank you for your patience with us. and priorities for the year. this is live coverage on c-span 3.

okay we're back. and we'll again with mr. latham. >> thank you very much, mr. chairman. welcome, mr. secretary. this is my last time probably to be here with you. and i guess i want to make a couple couple observations. going back with the clinton administration, the bush administeed administrati administration. i had always heard from farmers

that they felt that the department was supporting them. that that was their advocates in washington, for the farmers, was the department of agriculture. i will just have to say i hear every time i meet with farmers, talk to them one on one, is that there is a huge change. they don't think the department is on their side. when you look at things like the department of labor, when they come out with a proposed rule so that farm kids can help their parents on the the farm, the first response from you in the department basically is in support of the department of labor, rather than the farm and farm families. the department, i mean, you've got a lot of livestock producers out there. the department talks about meatless monday and the message

that sends to their, what should be the department's constituency. that you're against them. you're not with them. when they're inundated with regulations from epa, whether under the clean water act, particlants with the clean air act and dust, we don't hear anything in opposition from the department to support the farmers themselves and their positions. renewable fuel standard coming out. i would like to know what advice or counsel or what the department's position is that's going to be devastating to a lot of people in rural iowa certainly and a lot of places across the midwest and throughout the country as far as agriculture. but i just am -- leaving here it

is very, very disappointing to see the change in attitude at the department towards what should be their constituents. the farmers themselves. this is something that is obviously near and dear to my heart with my background, coming from the big town of alexander, 165 people, living in the suburbs on the farm outside of town. but there is a change. there's a huge change. and i hear it every day. and i don't know if you want to respond. we have a luncheon. that's why i have the green tie on with the irish ambassador here. i don't know in you have any response. but it is very discouraging to me. >> well, congressman, i am surprised by your comments, and i do want to respond, because i think they merit a response.

request reference to the department of labor, this department basically suggested that it was not the appropriate approach and that we suggested it was an opportunity for us to better educate folks about public safety and farm safety generally. and we work with the labor department to get that rule pulled. and to create an alternative approach. >> well, it wasn't your first response in your tweet. >> yes, it was. >> in support of -- >> yes, it was. yes, it was. >> no, no. our first response, congressman, was to suggest that there was a better way to do this. and we're working with penn state and another grant universities to develop a curriculum that will make it easier, and we work with the farm bureau and national farmers union. you can ask the others in the room with me when that was

proposed. as it relates to meatless money, i was very critical of that effort and immediately so. it was pulled immediately. it wasn't something that i sanctioned. and i would point out livestock exports are at record levels under this administration. every dollar that we spent in promotion is generating $35 in trade. with we are at record levels of agricultural trade and record levels of farm income. in terms of the e.p.a., we're working to make sure they fully understand and appreciate what will and will not hall and they're looking at. we've arranged for meetings to take place between farm groups and the epa administrator. we've arranged that the epa administrators go out and talk to farmers. industrial doesn't exist, and you know it. as far as the rsf is concerned, we are working with the epa so they fully understand and appreciate the current situation relative to gas. when the rsf was established, as

you well know, it feels based on the assumption there would be increased gas utilization by americans. that's not necessarily been the case. we are focused on making sure there are continued opportunities to expand exports of ethanol and continued capacity to have higher blends. in fact, i have spoken directly to governor branstad in our home state about a joint effort to encourage more e-85 tanks. i find it interesting that congress made it more difficult for us to do that when you essentially restricted us from using funds for blender pumps. we'll figure out a way to continue to help the expand opportunity for higher blend. so i'm happy to visit with those farmers who expressed disappointment to you. . that's not what i hear, and so obviously we must be talking to a different group. >> i think we're probably talking to different people. . >> i don't think we are, congressman. with all due respect. >> i know what i know. and it's very disheartening to

me to see the change in the relationship. there is an absolute feeling out in the country that the department sides more with epa or takes the orders from above and not advocating for farmers. >> that's just not true. that's just not true. >> that reality and perception can be reality. but that is the reality of the situation. anyway, thank you very much, mr. chairman. f i'll have to excuse myself here. >> thank you. >> thank you very much, mr. chairman. ful welcome, mr. secretary. let me thank you for your work. for your work to strengthen the integrity of the wic program and a science based food package that is essential to improving the health of our kids. secondly, i would like to quickly applaud, if if i can, the governors in the six states, connecticut, new york, rhode island, montana, oregon, and

pennsylvania, and thank them for making up the difference in food stamp program and understanding how critically important it is for vulnerable populations. on this issue because i want to move to another one quickly, in light of the education, commentary that we've heard here today, it's interesting to note that sfa, these are news releases na come out regularly. usda reminds producers of an approaching deadline on crp general sign up. sure disaster deadline approaches for 2011 crops. farmers and ranchers are reminded that the sign up period for revenue payments for 2009 losses has opened. enrollment reminders for direct encounter payments and other sfa programs. my god, if we can be getting notices out for all these other efforts, we sure ought to be able the to get notices and education out to the farmers

about dealing with their participating in the food stamp program. let me move to another area, mr. secretary. and that is, again, thank you for the restriction prohibiting domestic horse slaughter. thank jack kingston from coming by and mentioning it. but on a different area, why is the department so intent on moving guard with the proposed poultry modernization rule and given the reality associated with this proposal? rule is based on a program that has an inspection model project or h.e.m.p. gao twice found to have no food safety benefits. i just will -- this is a -- over 15 years usda's food safety and inspection service has been running pilot programs in 25

chicken and turkey processing plants called the base inspection model project. the project has been assessed twice. both times failed to convince investigators of any food safety benefits. also their commentary was that there's no data collected over the 15-year run of the program that demonstrates any reduction in food born bacterias. stutd studies showed a reduction in salmonella when more offline testing is done. no provisions in the modernization plan for mandating microbial testing. there were limitations in the data that was found by gao. in the report on chicken plants.

there wasn't a report on the pilot program at turkey plants. sfis has said it plans to address some of the limitations as it works on the final rule. the question is shouldn't the usda be addressing the data limitations so that we better understand the implications, including on food safety before we move forward with the rule. i've said nothing about worker safety. or any of the other areas that come into play with this effort. so that's a first question on this effort. without complete disclosure from sfif, the public does not have complete and accurate information to inform their comments on the proposed rule and provide them with a clearer understanding of the potential impacts of the final rule. again, shouldn't we be more transparent with the public? work with stake holders concerning the implications on

food safety, worker safety, and the treatment of an ma'ams before we move forward on this rule? >> congresswoman, thank you for asking the question. i guess i have a slightly different view of the rule than what you just outlined. i spent some time yesterday actually taking a look at the rule and reading it. and what i know from my reading is we've had a 30-year history with the 25 plants you mentioned. there's been a recent review of data concerning the 25 plants, and i believe the professionals are confident in saying that there has been an increase of compliance with safety standards equal two fewer product safety issues in the plants than tp general plants that we have and the other processes that we use and equal two t to fewer safety issues in the plants based on the data. this is a voluntary program. it's a program that would be phased in.

it would provide more inspections offline. it would require more verification of compliance with standard operating procedures and with the requirements. line speeds would average -- have averaged in the plant ps 131 per minute. there's obviously a difference between line speed and inspection and processing as it relates to worker safety. the processing, which is where the worker safety issues arise is really a function of equipment. it's a function of facility lay out. the number of employees involved. and the rule would provide if there are come compliance problems that we would be able to shut the process down. it would require new microbiological testing and make strong -- to worker safety. routine surveillance, quick mitigation of problems and

injury prevention program would be recommended. a complaint procedure would be set up. our workers would have opportunities to take a look, and if they saw a worker condition unsafe they could report it. i think on balance we believe this will save and present roughly 52 illnesses a year and we think the poultry system has not been modernized in 60 years. this system was established in 1950. she said it with such an emphasis as if 1950 were so long ago. that was the year i was born. it was a while ago. and certainly i have evolved over a period of 63 years. hopefully we can evolve a process. and i think we have made an effort to listen. when the final rule is proposed. that will reflect itself in proposals. >> mr. secretary, isn't it true the poultry companies will decide on their own performance

standards? and we are providing only guidance? and then the piece of this in which is very interesting is the end of the process if we find fecal material and all this other -- these other unbelievable contaminants on the product, that then it's dipped in a chemical bath, so that we then deal with whatever toxic configuration that is dealing with. and we are eliminating inspectors. we're allowing the company to put inspectors on. in addition to that there isn't a training program set up for inspectors. we'll have more time to talk about this. i understand my time is done. i think there's a vast amount of information. i will hope you will chance what the gao was saying because the gao reports are very, very clear to see no health benefits

arising for this, and the further understanding with salmonella, we are putting ourselves in public health danger. thank you, mr. chairman. >> thank you. >> thank you, mr. chairman. thank you for being here, mr. secretary. in your testimony you talked about how the discretionary spending under your watch has been cut to almost half a billion dollars. i want to commend you for that. working with chair imagine rogers and the leadership here we have been successful. do you have numbers on what mandatory spending has done in the same time period? >> we can get you those numbers, congressman. i'm sure it's likely increased, although with the recent changes

in the farm bill, we're expecting mandatory funding to go down. >> my figures tell me the mandatory spending has gone up at about the same rate ads discretionary figures have gone down. so the net cost is about the same. does that seem consistent with what information you might have? >> can you give me just a second? i want to make sure i answer your question accurately. >> well, what i -- >> dwail there's been an increase in mandatories during the period of about $31 billion. >> 31 billion. so we're cutting on the discretionary side. but the mandatory continues to

go up. >> the discretionary side is something i have at least some control over. the mandatory side is obviously mandatory. >> right, and i don't think there's anything that better highlights the issues that we're dealing with than those two statements. that we have to continue to work together to find a way to reduce the mandatory side of spending. that's what is going to bankrupt this country. all of our mandatory spending. i've been reading some dietary guidelines that have been published. and they say they want us -- they're going to focus on an ecologically responsible diet. and i'm just curious, what is an ecologically responsible diet? >> well, i think it's important

to put this in proper context. we take a look periodically. we have a set of experts who will make a set of recommendations to hhds in terms of dietary guidelines. and historically, not just in this this administration, but dating back to the bush administration, there were a series of factors looked at in terms of individual decision making relative to diet and food system issues that impacted and affected the availability of foods. so it is, i think appropriate to take a look in an overview and in a context area a variety of things that could potentially impact the availability of food. if you say it would be helpful for people to consume fruits and vegetables, that assumes fruits and vegetables are going to be available. and the question, are we going to have as many fruits and

vegetables available to us this year when a fate look california that produces 50% is inpacted by a drought that's the worst it's seen in, i don't know, 100 years. so there's a context for that as it related to what can we recommend? what impacts will there be relative to the availability of what we're going to recommend? >> i don't know that that really recommend answered my question. what i would encourage you to do -- >> i'm not sure that's what they will ultimately decide. i don't think that's the question that the dietary guidelines will decide. i think mail make a set of recommendations about what a diet should look like in order to be healthy. and as they develop those recommendations they're going to take a look at a broad array of things in terms of what the

context of those dietary guidelines. so i don't know that they're going to tell us what that is or that we have to decide what that is. their recommendation as to what a nutrition and balanced diet looks like and should look like. >> and final question. the former farm bill was very explicit. they were spoetzed to issue guidelines within 18 months after 2008. and we still don't have those guidelines. when can we expect them? >> we will have them in 2014. >> in march of 2014 or december? >> well, i don't mean to be facetious. sometimes between march of 2014 and december because it has to go through a process. we are in the process of finalizing the rules. we have gotten and received a more definitive definition of

what cat fish constitutes. i didn't know there was 39 or 40 varieties of cat fish. now i know that. and it wasn't clear from the language of the previous farm bill what congress intended and whether the inspection should be narrow or broad. you have given us specific recommendations that you want. that is very helpful to us in completing our process. . >> thank you, mr. chairman. >> thank you very much, mr. chairman. thank you, mr. secretary. i think many of us in congress are very interested in the department's development of the new regulations in connection with the farm bill defining the term active personal management as used to make actively engaged in farming determinations beginning in 2015 under the farm

bill. and members in my district believe that there's a misconception of exactly what farmer is and does on a day-to-day basis. one of my farmers actually said, and i want to quote. most will prefer driving a drak tor than doing all the tasks they face. unfortunately they spend their time coordinating with the fertilizer guy and talking about soil samples. getting the parts to fix the plan or getting to the bank oar working on leases, doing the paperwork. most of us wish we could get back on the tractor. that's the easy part of the job. clearly farming is not just driving a tractor. and it will be critically important to care for the considerable sitz and the cropping mix. the regional locations of the farms. the unique characteristics in

developing this new definition. i believe that the conference report provides excellent guidelines for your consideration. and i hope every effort will be made to make certain throughout the process there's flo disruption to family operations provided in the statute. i would like to get your thoughts on that. because in some south, east agriculture has a broad portfolio and many farms have multiple crops. and farming throughout the country, most farm families have a lot of farm income. and the second part of my question is, when do you expect to issue proposed regulations on the actively engaged interpretation? particularly given the equal

important competing issues that you'll have to tackle, including implementation of the disaster programs and the arc programs, which by the end of 14 or 15 or when will we have some sensz o f what that is? and how much input will the department allow for producers to actually talk about how they feel about this actively engaged definition. >> your microphone. >> congressman. we expect and anticipate to have a proposed rule by the end of this year, call year 2014 on the issue of act i liveively engage. and i say proposed concerning the input. that would give people the opportunity to weigh in on what

we propose. i think it is fair to say we recognize the diversity of american agriculture and we celebrate it. we know there are small operations. there are mid sized operations and there are large operations. and it depends on where pane what you farm in terms of the size and scope and what is involved in the management of the farming operation. congress has indeed given us a very narrow lane in terms of what our capacity is to define actively engaged by virtue of the restriction that we are not essentially par tis pay tor involved in family operations, and there's a fairly broad definition of what a family operation is. i think there was and is a concern on the part of many an appropriate concern that there are circumstances where folks who are really not actually farming and really not actually engaged in the management of a farming operation, but who have

invested in a farming operation, who participate in a very minimal way, in decision making have been able to qualify for benefits. and i think it is appropriate for us to take a look at that. and i suspect that's basically going to be the primary focus. i don't think your family farmers need to be concerned about this because of the restriction contained in the law that you all passed. #. >> okay, we'll be looking fwarld to that. let me change gears for a moment and talk about the forest products. my district's rule economy has a strong forest products industry. and i'm excited that given the changes enacted in the farm bill, it's clear that forest products are eligible to fully participate in the usda labor program. as you know prior to the farm bill there was a, quote, mature

market, end of quote, limitation placed on the user of certain products. now that companies will be submitting applications for the program, will usda move forward in processing them despite the regulatory mature market limitation, which is now outside the statute as a result of the farm bill? >> we would anticipate and expect action on that some time in the winter -- the latter part of 2014 in terms of our ability to incorporate those changes in the bio-based labeling program. >> i think my time has expired. >> mr. chairman, if i could, with your permission, 30 seconds of additional response. we are very sensitive to the challenges that you have alluded to in terms of forest industry. and that's why next week we are having a wood conference at usda that will encourage federal agencies to take a look at the

utilization of wood more effectively frequently in building projects and improvement projects for a variety of reason, not the least of which is the reason that we think we can make the case that it's climate friendly and with new changes in the structure and design of composite materials, we think in some cases it can be as strong as steel and concrete. >> mr. valadeo. >> thank you, mr. chair. mr. secretary. i'm glad that you referenced the fresh potato exclusion in the wic program. i would think that if folks wanted to encourage consumption of vegetables other than potatoes then it would be a consistent policy at farmers markets and supermarkets. as it currently stands with current vouchers people at a sup he were market can't process fresh white potatoes but they can purchase them at a farmer's market. i find that a curious inconsistency.

i have a letter that i signed along with 65 other members of the house including mr. rooney and ms. ping gree that express continued disappointment with this unnecessary exclusion. mr. chairman, i would like to submit a copy of that letter for the record. switching gears a little bit. your budget highlights rural opportunities and speaks about the number of communities, families and businesses that have been helped by usda programs. we are all glad that the rural development has been able to help these communities and families, but i think the credit should lie with congress instead of the department. the overall budget for rural development has been harder hit than any other areas in your budget. if we enacted your proposal, far fewer communities, families and businesses would be helped. take the water and waste disposal accounts for example. you have proposed for fiscal year 2015 appropriation of $304 million which is a 52% reduction

for the levels congress appropriated in 2014. you also proposed 304 million in 2014. it was hard for businesses to retain jobs or expand without access to clean and affordable water. how did the 52% reduction for a program that provides crucial infrastructure and where there is pretty wide bipartisan support help rural communities? >> congressman, i think it's important to point out that we are dealing in the context of this budget in terms of sequester and budget reductions and overall caps that we have to live within. 50% of the discretionary part of our budget is in four categories, it's in wic, it's in fire suppression, it's in rental assistance and food safety. 50% of our budget. when sequester comes, when budget caps are imposed, it is very difficult, if not impossible, to apply those reductions in that 50% category,

very difficult. in most cases those items are increased. in many cases they're increased. certainly that's true of fire suppression and it's certainly true of the wic program, so that means the other 50% of our budget disproportionately shares in the reductions. as it relates to the water and wastewater system, part of the reason why there is a need for less money is in the grant program, the grant program as you probably know is designed -- was designed to buy down interest rates on these projects. interest rates are pretty doggone low right now so there is not the need there once was. there is an important necessity for us to focus on particular sized facilities so we are faced with some difficult challenges and difficult choices and that's the reason why that number is what it is. >> okay. and i also want to associate myself with the remarks of the chairman for his concerns of the

cuts of the section 502 direct loan program and self-help housing programs. this past summer i spent a few days out in lamont, california, south of bakersfield with some families that were actually building their own homes with the help of these low interest loans. it's obviously an amazing program because people actually take the time, families get together, they build a community, they build their home and actually, i mean, when you see a community get together like that, work together on each other's homes, gain some talent, pride in ownership, pride in their own efforts and actually learn some new talents from this or new skills, it's a beneficial program. this program obviously took the same type of hit. this program saw a cut from 900 million down to 360 million. i was disappointed. i wondered your rationale for the cut? >> first of all, i want to be

clear. in terms of the direct loan program, we are not cutting that program in terms of the budget authority, we are actually increasing it, but the cost -- the subsidization and cost of borrowing, the subsidy rate went from a little over 2% to over 7% in a single year so the reality is that more money buys less. it's not that we want to buy less, it is a fact of the marketplace. secondly, congress a number of years ago changed the way in which it funded rental assistance. in the past you all funded rental assistance projects as they came on board and fully funded them in the year they were created. over the course of the last 15 years or so you have changed that dynamic so that every year we have additional units that come into our budget that are expiring under the -- under their first and existing contract, like it might be a 15 year krd, it might be a 10 year contract, a 5 year contract, now it is a single contract.

now we have 7,000 rental units we have to focus which concentrates on the 285,000 families that are receiving rental assistance. if you want to, you know, not have a cap, fine. if you want to look at other aspects of the budget, if you want to reduce fire suppression and put 45 a other homes at greater risk, if you want to reduce wic, 8.7 million women, infant and children that benefit from that, fine. the realities are there are difficult choices to make, but i want to make sure it's clear, we have no control over the subsidy rate on these loan programs. when interest rates go up and when borrower's income is down, it makes it much more costly to fund these programs. >> thank you. thank you, mr. chair. >> ms. pingree. >> thank you, mr. chair. thank you, mr. secretary, for being here this morning, for the great work that you do in handling so many diverse and not always easy questions.

i have plenty, but i actually think my first question is very simple. i want to talk a little bit about the farm bill implementation, and i'm going to use a specific example of the main senior farm share. so back in maine we're hearing from a lot of people, farmers, consumers alike who are worried about the implementation of farm bill programs, particularly those programs that were left stranded without full funding after the last farm bill expired in 2012. there's a lot of anxiety in my home state about when the funding will be released and what changes they should expect. so i was a little concerned just recently, this is a new hampshire headline from maine, that it says the delay threatens farm program from maine seniors. the usda has not yet provided a time line for implementation of the senior farmer's market nutrition program which funds the maine senior farm share. seniors and farmers are receiving mixed messages about whether funding will be released this year at all. the state's website says we must wait for guidance from the usda

rashding what will be required from state agencies to on perfect flat 2014 and when we will be authorized to proceed. our 2014 grant amount is also unknown. in my opinion, a delay in the farm share program is especially harmful because this is the time of year when farmers are planning for their upcoming growing season. they need to know how many seniors will be signing up for farm shares and this article notes that until the usda releases funding, maine can't allow their farmers to apply for the program. now we only have a million people in our state, but last year there were 17,000 maine seniors who were able to take advantage of this, buying food from 118 farmers. so far they're in the dark. do you think you can get the money out the door to help them plan and guarantee we'll have the money this year? >> we've been waiting for the apportionment on those funds from omb. we anticipate in the next couple of weeks we'll have that completed so that should alleviate the concerns you've

expressed. >> great. i can tell people there's a very strong likelihood this program will be operating this year? >> yes. >> they'll have the money. okay. that was easy. so i want to -- i want to reiterate a little bit of what congresswoman deloro already said to you. i have some of the same concerns and i want to thank her for advocacy on the poultry slaughter rule. i have a lot of concerns and i appreciate the many answers you gave. i'm going to take a different takt on this but i think there will be a negative impact because of the poultry slaughter rule, i think it will have an impact on food safety, worker welfare, poultry slaughterhouse workers have consistently suffered injuries and illnesses at a rate more than twice the national average and because the line speed could increase up to 175 birds per minute i think it's hard to say that won't continue happening. here's a little bit of a different tact. so since you're currently proposing the rule that allows

the industry to police itself and potentially get even bigger slaughter houses, i want to say that there are many american consumers that are looking for something slightly different when it comes to meat. according to the usda's economic service, per capita meat consumption is declining but demand for meat is growing at 20% per year o are began anythingically. at the same time small consumers are lowering. i know in my home state in maine, this is true in much of new england and the northeast, farmers have to travel several hours to reach the capability to slaughter their animals. in my opinion, the demand is there and the usda needs to do more to support the infrastructure that connects livestock producers with consumers. you talk about outreach and technical assistance to small

and very small processing plants. could you provide me with information on what your total budget was in fy '14 for this activity? >> while we're getting you that number, if i can amplify on what that resource buys. we basically are focused on the 90% of the 6400 plants that we consider to be small that are under our jurisdiction. we have a small plant help desk that has a hotline that folks can call with any questions they may have. there are training materials and educational materials that are produced. there is a small plant newsletter that goes out on a regular basis and we provide direct help to state agencies in terms of working conditions. i might also point out that this administration has been encouraging mobile slaughter units to be able to address the issue of distance between processing facilities. we stant ready to continue as part of our know your farmer initiative to help engage in

that and we've also been encouraging folks to take better advantage and more advantage of the interstate meat rule that basically allows for an opportunity for state assisted review. so there is a multitude of steps that we're taking. let me see if i can get you the specific number. >> i will -- i'll give you one more piece of information. you can follow up with the information. so i just want to say, i submitted a title you may remember that was called the local farms and jobs act. one of the things we called for was an advisory group to help develop guidance on food safety guidance, process control and pathogen prevention in small processing plants. we also suggested that the usda work with an advisory group to develop a report and set of recommendations on steps that can be taken to assist the small processor. the previous report, which was published in 2006, is now eight years old so i guess i'm asking or you go issing that under

existing authorities could you explore moving these two pieces forward as part of your effort to invest in local and regional food systems and could you use some of the research and technical assistance funding that's in fsis budget to move forward on an advisory group or update of that report? >> those are fair questions and fair requests. we certainly should take them into serious consideration. you know, i -- i think it is important to note that we have been engaged and involved in terms of market development in a very significant way. our view is that in order to help these smaller and mid-sized producers we have got to create more market opportunity which is why we've been involved in expanding a number of farmer's markets and food hubs. i will continue to focus on that as well. >> let me reinforce. i know my time is up. i do appreciate with all the work you've done with know your food, know your farmer. i think you've done a lot of work to expand this market and i

would say this market is growing very nast spite of whatever anyone has done. it's a huge interest and often it's the inability of the producer to meet the demands of the market. >> mr. forden berry. >> thank you, mr. chairman. let me thank you to coming to nebraska to speak to the rural futures conference. i thought you did an outstanding job retailing the great 34er7b agricultural story. i was grateful for your attendance there. i have three points i'd like to make with you. the first one being, i very much appreciated what you began with, talking about how 40,000 new farmers and disadvantaged farmers will come into our system, our agriculture family through the efforts of this farm bill. i worked on some components of that. but i do want to return to the point that mr. bishop raised earlier regarding payment limitations and closing loopholes. in the farm bill i had offered an amendment on the house side

that put stricter payment limitations in place and it helped what we thought was going to help you with actively engaged rules. the senate did the same things. the conference committee saw fit to take that out with an extorsion of the process. i thought this was a good agricultural reform measure. it passed on a bipartisan basis but we lost. the residue of what is left though again gives you the authority to define actively engaged. there is a general accounting office -- accountability office report out. a farm in the midwest received $400,000 of payments in 2012 organized as a general partnership with six corporations and 11 individual members, two of whom apparently lived in south florida and one was 88 years old. now this type of thing gives a black eye to agriculture overall. when we are these exotic financial arrangements, these legal loopholes that are leveraged, when we are in a time of declining budgets and the need to be very, very aware of

the impact that our programs have not only in terms of budgets but in terms of perception, we have to do a very robust job here of thoroughly going through this process and ensuring that, again, deserving farmers who are a part of the agriculture community, not simply passive investors, are receiving payments. i'm worried because 10% of farmers receive 70% of the payments. and when you have a situation like that, we and you may be inadvertently underwriting the concentration and undermining what we're doing on the other side of the department which is so important of trying to bring new people into agriculture. i'm very concerned about this and i'd like to hear your response. the second issue is regarding adverse wage rates. this might be a little bit out of your purview, but in nebraska it is $13.41. i have two small farmers who came into my office trying to

use h2a money doing this legally. they're being pushed out of the market. the wage rate is $12.22. $10.89. $11 in california. now the department of labor, you apparently shot this out to the department of labor, but we've got a peculiar grouping of states here that is driving up this wage rate and potentially, again, pushing small farmers who are trying to be entrepreneurial and using, again, diverse and traditional means of farming production that we're encouraging in the rest of the bill, this ear being pushed out of these marketplaces. the third issue is regarding the drought mitigation. very important to us in nebraska. with this being the year that we see through the office of the chief economist competitive federal funding for drought mitigation research. >> so, first of all,

congressman, i made a mistake in responding to congressman bishop's question. i really should have had you respond to him about actively engaged. i mean, honestly, i think that is the nub. i think congress has given us, as i said, a very narrow range of options to look at because of the fairly broad definition of family farming. fair enough. you have raised concerns about situations where that -- the rules have been stretched and creatively utilized, and i think our task is to take a look at what makes sense and what doesn't in the real world and basically provide credibility and legitimacy to whatever support system we have. this support system is important for farmers, as you know, and we can talk about how many -- what percent get what percent, but i think it's important for all of us to explain to our friends in urban and suburban america that

support systems are used to design the risk of farming. farming is a difficult and risky business from a financial perspective because you have no impact on mother nature and no impact on some foreign country creating market havoc. we have reduced the risk and we keep people in the farming business. we obviously want a program that people believe in so we will work very hard to try to do the right thing in this area of actively engaged. >> all of this is said in the spirit of being a very strong supporter of farm payment system and the ups and downs of the vagaries in the market and to give farmers the control they used to have but when you've gotten to the size of graduating from that need of public support or you're working around it, it's a concern. >> i'm not disagreeing. should i respond? >> if you could respond. >> you know, my response, and it's an honest one to the adverse wage rate issue, is to

fix the system and that would help, i think, comprehensive immigration reform and new opportunities for usda to be engaged in that process in establishing wage levels would be the solution for the concerns that you've raised in the long term, and on drought mitigation, we are support being the drought mitigation people that do good work in terms of the monitor in nebraska. we will continue to focus on ways we can provide additional resources. we announced a $30 million competitive grant program on water that is involved to folks. we'll continue to be very engaged in this space. >> thank you, mr. chairman, thank you, mr. secretary for coming to the committee today. i represent kansas. obviously a big farm producing state, a lot of wheat farmers, a lot of livestock. so your role in looking out for kansas farmers and consumers and everyone across the state is very important to me as i'm sure all the members of the committee

in terms of their states as well and across the whole country. i have a question following up on the farm bill compromise that ultimately passed the house and senate. i know you were involved in helping ensure that we have a long-term bill that creates certainty for farmers, predictability, that responds to the needs of crop insurance and other programs. there's a lot of things to like about the bill. there a there's a lot of things not to like as well. one of the distressing portions is the balance that came out in terms of -- there are a lot of people that are hungry and in need. we work to ensure we feed people on the committee and we also take care of the family farmer. when the bill came forward it had a sort of compromise in which 1% of the reductions out of the -- came out of a food stamp program and about 7% of reductions came out of commodity programs to help farmers.

some people thought that was a little lopsided. i was one of those folks. but that was what ultimately came out of the compromise in this congress. it was looked at as the balance and the people are looking for the parties to work together and find a balance and that was it apparently. yet now we see that hard fought compromise may not come to fruition. quote, when congress passed the farm bill earlier this year it expected to save 8.6 billion over ten years by tightening a loophole in the food stamp or snap program but it's not going to happen. so what was already a lopsided compromise is now not even going to happen. i think what most people in this country want to ensure is that if you qualify for food stamps, you get food stamps and if you don't qualify, you don't qualify. there was an effort by congress to fix what some call loophole. many supported it. i guess my question for you is were you aware when that bill was going forward that those savings wouldn't actually

materialize on the snap program? and what can you do in your role as secretary to ensure the intent of congress to ensure savings will actually happen. >> first of all, i really did not consider or think about what individual states, governors and state legislators would do in response to the farm bill passage. i was focused on getting the bill passed and trying to figure out a compromise, particularly in the dairy place that was the major stumbling block. so, no idea. there was no indication one way or the other. and, frankly, as a former governor and as a former state senator, i respect obviously the role of both state legislatures and governors to make the best use of their resources for the best interests of the folks. now i have always said when there was a discussion about this issue, i have always said that the right way from my perspective to reduce the snap numbers, both in terms of numbers of people and in terms of dollars, is to try to find

ways in which we can better link the job opportunities that are being created in states and the folks who are on snap who are looking in and cap panel of working. one of the exciting opportunities i think this farm bill presents is the ability to really dig down with states to do a much better job of creating that link. it's hard for me to understand why state work force development offices aren't doing a better job of communicating with state human service offices because they know where the jobs are and they know who the snap beneficiaries are. there ought to be a way that we can better connect those two things. if we do, we're going to see better reductions in the people needing snap and the cost of that program. >> mr. secretary, i think there's broad bipartisan support for that and everyone would concur that finding way for people to go to work is the best way to bring people out of po o poverty and feed people.

the question comes back to compromise, it's lopsided, isn't going to be achieved and so i guess what part of that $8.6 billion that democrats and republicans supported as this sort of let's all work together to find a solution that now the -- half of that solution's no longer going to happen. do you know what portion of that will occur? will any of the $8.6 billion be saved? >> people are still making decisions in the respective states that are affected by the liheap decision. there are 17 states that are affected. not all 17 states have made a decision so i think it's a little early to determine exactly what that savings are going to be. our focus, and, again, is going to be on two areas that we do control at usda. one is working on those pilots, which we've talked about, and the other is which the chair has brought up, is the issue of integrity. i think conducting 733,000 investigations and interviews last year that disqualified 42,000 folks that were trying to take advantage of the system is

an indication that we're serious about that. 1200 businesses that are taking advantage of the program are no longer involved in the program. we're serious about it. the additional resources we're asking for in this budget will allow us to do more of that. and i think the farm bill discussion of redefining what entities are entitled to participate in the snap program in terms of the depth of their offerings in the store, they've got to do a better job of offering more of the basic food groups will also, i think, substantially reduce the amount of misuse in this program so those are two critical ways where we control the ability to reduce the amount without disqualifying people that would otherwise be qualified for the program. >> right. i certainly appreciate those efforts. i think many in congress do. i think the intent of the bill was to ensure that you had to qualify for food stamps to receive them and to sort of close that loophole and democrats and republicans both supported that. i would hope that you would do all of that to ensure that the congressional intent is followed in the administration of that

program. i yield back my time. thank you, mr. chairman. >> mr. secretary, a couple of members of the subcommittee have mentioned the farm bill. of course, everyone is very happy that it follows agriculture and most people are involved in agriculture one way or another in this nation, whether directly or indirectly, but you have the problem now to implement this farm bill. what do you see from your standpoint as the priority programs that need to be implemented first? >> well, the first program that's going to be implemented is the disaster assistance for livestock producers. these folks have struggled through two difficult years. the farm bill of 2008 expired and we were not able to provide assistance. we know that has put a strain on small to mid-sized operators. we will on april 15th roll out the disaster assistance programs

allowing people to apply for assistance. that will be followed by a series of efforts throughout 200two 2014 in terms of the programs that are important to people that we have access to. i think you'll see a significant amount of activity in 2014. what i have done, mr. chairman, is i have instructed our team at usda to look at each title of the farm bill, to prioritize specifically what needs to be done first, second, third, fourth, and fifth. we have a convening group that oversees and looks at all of the tiertless and has prioritized activities and we will be very much engaged in outreach and education during the months of -- between now and, say, fall in terms of these safety net programs to make sure farmers know precisely what the programs are going to look like, what their elections and options are, what decisions they have to make and the information they need to make those decisions.

we're in the process of determining which land grant programs will have $3 million allocated for that purpose. you'll see quite a bit of activity throughout the year. >> in your testimony you talk about the new standard for snack foods and schools that preserve flexibility for activities like fundraisers and bake sales. you mention those in particular. would that also include like when a mom was to bring cupcakes for a birthday party? that would include that? >> okay. we're not going to stop mom or dad from bringing cupcakes. >> well, usda's -- >> [ inaudible ] >> absolutely. usda recently proposed a rule requiring that schools establish a local school wellness policy. it states that the policy must also address standards for other foods and beverages available on campus. these would include policies such as those governing classroom parties or school

celebrations that involve food. there seems to be a little bit af conflict with this -- when we talk about time honored traditions. maybe usda isn't setting the standards regarding that, but it seems to be mandating that schools do set a policy. is that what the intent is? >> the wellness program has been in existence for some time and this was just a continuation of that program. and i think primarily what we were attempt to go do and what we announced was to suggest and focus on the marketing during the school day. the theory being if we changed the mix that was in the vending machine or a la carte menu, we would provide consistency in the message. we want healthy snacks to be easy, the easy choice, but we don't want to necessarily restrict the ability of school

districts after school hours. we don't want to have them take down the scoreboard that is advertising a particular type of soft drink at this point in time, but we'd like them to be conscious of the need to be consistent messaging. >> so, again, if i'm understanding you right, if a school in some way interpreted this to be that a mom or dad can't bring their cupcakes -- >> no, that's not -- >> -- has no bearing whatsoever? >> no. i think it is primarily the vending machines that schools operate and the a la carte lines to make sure there is a consistent messages. >> i can tell you there's a lot of moms out there that have, you know, about their bringing chocolate cupcakes to their 2 grader's birthday party at school and the federal government telling them they can't do that or the usda says

they can't do that and you have no problem with trying to tell them to intervene whatsoever. >> as a consistent and constant consumer of cupcakes i can tell you that's not the intent. >> thank you. thank you, mr. secretary. at this time i'm going to recognize ms. deloro, mr. forest is kind enough to defer. ms. deloro. >> thank you, mr. chairman and thank you, to my colleague, mr. yoder. the farm bill historically has been looked at as a safety net to both farmers and for farming and for nutrition and quite honestly that this was really the renting of that historic bipartisan safety net and i'll tell you why in this regard. you see, the farming and ranching community was in the farm bill. when you had talked about the cut in direct payments, then

what occurred was an increase in crop insurance opportunities and then, secondly, there was instituted something called shallow loss protection to deal with commodities. now -- so there are places in the farm bill where farmers, ranchers can go to make sure that the safety net isn't rented, with regard to the food stamp beneficiary. they have nowhere else to go. nowhere else to go. when you cut 1.7 million people and you say we're going to cut your food stamp benefit by $90 a month, they can't deal with shallow loss. they're not dealing with crop insurance. so this was a false construct in this farm bill. let me just ask and i will do this for the record, mr. secretary, because i want to ask something else. this has to do with the crop insurance program.

and i've seen the articles that have come out about cheating and skirting, etc. i believe that we ought to provide those terms and a hard look at the crop insurance program. let me lay out the questions and we'll get them to you. do you expect the reforms -- and i applaud you for the reforms that you can have come forward with. do you expect them to produce producer reforms? who receives crop insurance subsidies? what percentage went to the largest 1% of agri-business? can you talk about the projections for crop insurance in 2014 based on weather and agriculture? are we in fact going to reduce enrollment and payment and particularly who gets these subsidies? and we both know that 26

individuals who get at least $1 million in their premium subsidies are protected statutorily from our and taxpayers knowing who they are so i get the questions to you and i would love to have you respond as soon as possible. let me go back to the poultry rule if i can for a second. it was brought to my attention in one of your comments was about the last time we did chickin inspections, but the fact of the matter is beef slaughter inspection has not changed even longer period of time. but no hemp pilot in beef occurred because there was no industry takers to do the pilot. now in the area of performance standards on micro biological standard, microbial standards,

i'm sorry, it's now voluntary for the producers. can we -- why can't we move to required standards on microbial testing instead of voluntary? one question i want to deal with and i'll ask a second one because my time is going to run out and i'm conscious of that, but recently the center for the study of -- anyway, cspi, i've forgotten the -- science and the public interest, thank you, why does usda refuse to consider the multiple resistant salmonella as an a dull ter rant? the same way we do as e. coli 1057h7? you've got a 25 million per year to create an innovation center

to study antibiotic resistance. i would like at some point if you can and maybe for the record because there isn't time now to let us know about the petition that cspi put together and the questions that they have asked and if we could get an answer to those questions. voluntary versus -- >> actually, i think to a certain extent the questions are in a sense one and the same in this respect. there is a difference between our jurisdiction and capacity relative to beef and e. coli and poultry and salmonella. it's based on what you're asking to us do and we were told by the court that we did not have the authority or the jurisdiction to do that. so, as a result, we have been looking at ways in which we can improve efforts at reducing

salmonella. we've initiated salmonella performance standards that are enhanced and for the first time came up with bacterial standards. we are proposing to enhance our sampling to intensify testing and to potentially post facilities that have inadequate results from these tests, and as you point out, we are trying to have an innovation institute that really focuses on this issue. >> but we can't require microbial standards to be -- >> i have been told -- >> you have performance standards. they are going to come up with their own performance standards that may or may not coincide with your performance standards. >> we have performance standards that say there are certain levels of the -- the reality of the biology of food production is there are certain levels that can't be avoided and have to be

dealt with in other ways. we have been very aggressive on e. coli because we believe we have the jurisdictional power to do that. we have been able to, for example, expand the number of adult ter rants. we've been focused on beef trim and all of that stuff so i think a lot of this has to do with how courts have perceived our jurisdiction and our resource and our power. >> have you asked for the authority? can you ask for the authority? ask us for the authority. >> well, we've attempted to exercise the authority and courts have basically told us, can't do it. >> ask us for the authority. >> well -- >> i'm serious. >> i didn't realize -- >> supreme court just dealt with led better, etc. advance versus ball state. we turned that around in congress. we have legislation here we can deal with these issues. ask for the authority. thank you, mr. chairman. thank you, mr. secretary.

>> thank you, mr. chairman. mr. secretary, just to maybe return to points that my good colleague from connecticut raised, i think the point of our dialogue was that there was a compromise that was struck in the bill that would reduce commodity programs for farmers by 7% and reduce snap program by 1%. some people thought that was lopsided. my only point that i'm trying to make, sir, to drive that home is that at least the 1% that is out of the snap program, that is merely an agreed to point, it should be fixed and it would save $8 billion and that would be the agreement. we'll leave that and i'll say support of farmers and support of the agriculture community is a long standing tradition of this congress and this country and without a healthy, vibrant agriculture community, without healthy, vibrant farmers there is no food in the grocery store for people to buy or for snap

beneficiaries to purchase and so i think we need to be mindful. the 7% reduction, i would be hard-pressed to find any other program that's been reduced in that amount and farmers have been noble and to give up payments in a time in which we don't know what the future of agriculture brings in terms of the economy going forward and it can be some tough times. we've all been through tough times. in farming would he have to ensure we have a vibrant agricultural community. now i have a couple follow-up -- or a couple i guess unrelated questions to that topic. i want to ask you a little bit about the lesser prey chicken. i would like to ask you about the partial irrigation ability to use crop insurance. clearly farmers deal with a lot of epa regulations, they deal with a lot of bureaucracy and mandates and things that drive up the cost of doing business

that makes food more expensive in the grocery store, that makes it harder in this country to have an affordable food supply. you have a farming community that is successful and produces affordable food. one particular air kbra that is troubling a lot of kansas farmers is that the fish and wildlife service is prepared to issue a ruling on the endangered species status of the lesser prey chicken on or before march 31st. as you know this will impact a large portion of western and southern kansans. is there anything we can do to lessen the cost and burden and expense that may occur if this is listed and will folks who are enflold crp after march 31st still be able to take up the contracts? >> senator, we have been very much engaged in discusses with the fish and wildlife service

issues relating to not just the lesser prey chicken but sage grouse and other endangered species that could be listed. in fact, i think there's seven specific species that we are working with the department of interior on. one thing that we are attempting to do is to create what we refer to in our shop as regulatory certainty. the reality is the biggest concern that a lot of producers have is once they've taken certain steps can they be assured that those steps are all they will be asked to do. so we have instituted a program with the department of interior where we use our conservation resources and develop a suite of conservation practices and in exchange for embracing those conservation practices and using our cost share programs, producers are guaranteed a certain level of certainty that if and when a particular species is listed they will have to do no further actions relative to that listing. we've done this in sage grouse

and it's been particularly effective and we are currently doing this with, as i say, six other endangered species including prey chicken. we are continuing to look at ways we can provide assistance and help hopefully to avoid the listing if that occurs and if the department of interior makes the decision for it to be listed to assist landowners with the costs and cost share of any steps that they need to take in order to protect themselves from that listing. we'll do everything we can to educate our sister agency from the impact and do everything we can to mitigate its impact if and when it's listed. >> what about the crp program in terms of folks that are enrolled after march 31st, will they still be able to take up those contracts? >> i'm he going to have to -- i don't know the answer on that question. >> if you would permit me, i've got some constituents inquiring on that. >> i will certainly get back to you on that. >> another issue on crop insurance.

you can have an irrigated crop insurance program or a non-irrigated program. just quickly, mr. chairman, did the department look into a partially irrigated system? because we've got farmers who are not fully irrigating because of drought or irrigation reduction programs and so they're not qualifying for the irrigation program but they're not really a dry land program either. >> currently there are a small group of farmers who have individual written agreements providing that protection. part of the problem is it's been hard getting the data that would help us be actuarial sound and be a legitimate insurance product, but with the experience we're having with the individual agreements we hope to get to a point and obviously when and if we get the foundation, we will look at that. there is also within the farm bill an opportunity for us to take a look at irrigated and unirrigated policies. >> mr. farr. >> thank you, mr. chairman.

i'd like to shift to an issue on food for peace. i'm a return peace corps volunteer and certainly interested in the food for peace program. i've seen in the years since i've returned from the peace corps a real shift in the world's ability to deal with food delivery. what we've essentially had is a feeding program to help impoverished areas. it's been odd. we brought it to the united states on our flag carriers all the way to these foreign countries and the new effort is to try to, as we are domestically, trying to empower host country nationals to develop their own ability to have a viable agrarian economy. i recently got back with some members of congress from ethiopia which is one of the

strongest countries in latin america, biggest and most populated and strategically necessary for the world security because it's positioned in the horn of africa. ethiopia is a huge agrarian country. we have a lot of programs there, including peace corps. but what shocked me is we're still all aiding about $800 million a year to that one country because they can't even feed themselves. a lot of that is food aid. you mentioned in your opening statement that you're asking authority to use up to 25% of the total account to increase the flexibility in emergency aid for complex prices, specifically within regional purchases and cash vouchers and cash transfers. the budget justification states that this authority would allow usaid to reach up to 2 million

more people in challenging emergency situations such as we've seen with the internal and external displacement of people in syria and sudan and i'm just wondering if you could clarify for us how these increases in flexibility of title 2 funds would allow you to reach more people. >> well, it's pretty simple, congressman. it basically is less expensive when you do it in country and you actually can get the relief to people a lot quicker. under our current system it can take anywhere from 10 to 14 additional weeks to get relief to people who are obviously in need immediately and we can substantially reduce the time and the cost with that 25% which in turn would allow us to buy more food and get that food to people. >> is that triggered with ability to -- i mean, ethiopia's struggling to be able to better have yields, to have -- obviously they're in the coffee business now and starbucks has

done a great job of sort of helping them build their infrastructure to have an international coffee market, coffee exchange. so are we working with these countries that we're distributing this food in so that they can build capacity? >> that's -- there are two aspects to that question. one is within the food for peace program there's roughly $270 million that's used for additional development to sort of mature the agriculture that exists in the country and then our feed the future initiative, which is an effort on the part of our foreign ag service, essentially is helping to train tens of thousands of producers in africa and in developing countries to be better farmers. we don't see this as a competitive situation, we see this as complimenting american agriculture. if you actually strengthen agriculture in developing countries, you create larger and larger middle classes. those larger and larger middle

classes are encouraged in producing value added processes in this country. we think it's an appropriate way to use resources. >> we had some resistance obviously fwi commodity groups and by flag shippers and unions and so on. have you been able to work your way with the i.d. and alleviating some of those concerns? >> we've trying to transfer jurisdiction and responsibility to usaid. we try to engage our union friends and shipping friends and producers to make sure that they know there's still a substantial amount of quantity that's produced in america, shipped by americans and it hires organized labor folks to load it and to provide it. so our hope is that we've

approached this a little more effectively this year than last year. >> i support it on one condition, and that is that you stay in charge of it. what happens with the usaid and that's in another appropriations committee, but that money gets into that 150 account and it's consumed by all the other competitors of that account. you lods tse the ability and i applaud your effort to maintain control of it. >> i'm assured of this job today. i don't know about tomorrow. >> thank you. >> mr. mitchell. >> thank you very much. let me first go back to mr. fortenberry who talked about his amendment in connection with our discussion about actively engaged. i just wanted to point out that i voted against his amendment because there's a difference between actively engaged, that issue, and payment limitations.

those are two separate issues, and i think the conference committee was probably more thoughtful and better informed in recognizing that different regions of the country, like in the southeast, have different needs with regard to the amount. i think it was a specific amount of payment limitations that was the problem because in the southeast they have farmers who have multiple crops and that definitely impacts when there's a lower payment limitation. i just wanted to point that out. but i wanted to go back, mr. secretary, and i think last year you and i discussed what i think is one of the most creative initiatives undertaken under your tenure at the department and that's the strike force initiative. the strike force initiative introduced in 2010 is one of the tools that usda is using to combat poverty on projects to

promote economic development and job creation. i'd like to just put on your radar screen the 10, 20, 30 concept which has been put out in connection with an overall attack on poverty trying to assure that 10% of the resources can be utilized on communities that have had 20% sustained poverty over a 30-year period, using that as a metric for trying to allocate services. several people have been targeted to participate in a strike force initiative. it's been reviewed as a refreshing and appropriate resource. to reach out to communities that have not benefitted from the department's programs. can you give us an update on where the program stands today

and your vision for the future. >> congress, thank you very much for asking the question about rural poverty because i think it's an area that is often not talked about and discussed in this country and unfortunately we see extraordinarily high and consistent poverty in america. higher than it is in other parts of the country. it directly impacts children in a very serious way. strike force is now operating in 700 counties in 20 states and travel areas. as a result of strike force, we've seen increased participation in farm loan programs, we've seen increased participation in farm loan programs, more housing opportunities created and we've seen a market increase in the number of summer feeding opportunities that exist in rural areas. there is still a great deal of work to do. we've gone in a slightly different direction as it

relates to your 10-20-30 program. we have a 20-2016 program. 20% of our rural development would be invested in areas where there is a census track of 20% poverty or greater and we want to reach that goal by 2016. as of today i think we're in -- somewhere in the neighborhood of 18.5% or so of our resources being invested in those areas and i am confident we will get to the 20-20 by 2016. after that maybe we can look at additional challenges. this issue of rural poverty is part of a larger concern that i have with -- just if i can have 30 seconds, mr. chairman. three major factors about rural america. one, highest poverty rate in 25 years. two, despite the fact that we've had job growth in this country in the last four years, little

of it has actually been seen in rural areas. we're just holding our own. and, three, for the first time in the history of this country we actually saw reduced numbers of people living in rural areas, and part of it has to do with what's happening in agriculture, we have increased number ever very small organizations. we have to figure out ways to provide market opportunities for those in the middle which is back to the congresswoman's questions about local and regional food systems. that is one strategy for doing that. we have to look at ways to use conservation, rural development resources and the local and regional food system to create opportunities in order to keep our kids in those areas and to reverse some of those trends. >> may i just ask one unrelated question? >> real quickly please. >> can you give us some idea for

the fsa droerktor's position that's vacant in georgia of when we can expect to get a director? it's been vacant for some time. >> congressman, i don't know the answer to that question specifically, but we will get you an answer by the end of tod today. >> thank you very much, mr. chair. thank you again, mr. secretary. you've put in a long morning and afternoon with us, and i won't drag out the pain too much longer, but i do concur a lot of my colleagues have asked many of the things that i wanted to talk about so i appreciate them bringing so many things up. i've just got one and i'm sure it's yet another one of your favorite topics. that is around gmos. maine just recently became the second state in the country to pass a law requiring the labeling of genetically modified ingredients in foods. just as an aside, i would say this was a republican sponsored

bill passed by democratic legislature signed by a republican governor. i think i can say maine's call for action konls from people who want to know what's in their food as well as farmers that are concerned about the contamination of their crops by genetically modified crops in the area. so could you just give me a quick update on the activities of ac 21, your working group dedicated to farmers with genetically modified zplops and i'll throw in two questions. is there funding for ac 21 in your budget and has the department been hearing the concerns of those farmers and consumers? >> the ac 21 committee was a balanced group of folks who were supportive of gmos. folks who are conventional producers and folks who are professionals involved in all

aspects of this. there were a couple of recommendations from ac 21. one is taking a look at crop insurance programs to determine whether or not we can do a better job of doing a better job for crop producers. the result has been, number one, the elimination of the surcharge on organic products. number two, an expansion of the number of products available. i think there are now over 350 policies that are sold for roughly 130 crops and, number three, better pricing of organic crop insurance in terms of price election. the challenge with organic is that it may be the result of a contract, it may not be the result of a market in the same way that basic commodities are so we had to basically begin to make an adjustment of how we might be able to compensate folks for damage. that's one thing. secondly, there was deep concern about the importance of keeping and maintaining the quality of

regenerate should there be an event or incident. that prompted us to take a look at our own storage and seed bank capacity to do a better job of maintaining, testing and examining the seed banks to make sure we continue to maintain adequate supplies and that they haven't been contaminated or impacted in any way. number three, you know, working on ways in which we can provide better information concerning stewardship responsibilities in terms of knowing what your neighbor's planting, knowing how what you may do may impact potentially your neighbor and the value that's -- the high val added opportunity that organic promotes and provides. number three -- or number four i think there was a concerted effort to increase our research budget and to make sure that our conservation resources were