On Tuesday and Wednesday of this week, the House Appropriations Subcommittee on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies held two hearings with top officials at the U.S. Department of Agriculture (USDA).

On Tuesday, Secretary of Agriculture Tom Vilsack, along with Deputy Secretary Kathleen Merrigan, Chief Economist Joe Glauber, and USDA Budget Director Michael Young, answered questions related to both the President’s fiscal year (FY) 2012 budget request and the FY 2011 appropriations process.  Then, on Wednesday, USDA’s Inspector General testified before the Subcommittee on a variety of issues relating to incidences of fraud within USDA programs.

With the Continuing Resolution (CR) set to expire March 18th, the committee is exploring the state of USDA’s spending and how to proceed throughout the remainder of the 2011 Fiscal Year and into FY 2012.

At the first hearing, Secretary Vilsack and members of the Subcommittee discussed a number of issues and programs of concern to NSAC, including commodity payments, food safety, agricultural research, the Conservation Reserve Program (CRP), and the Supplemental Nutrition Assistance Program (SNAP).

Vilsack and fellow Iowan Tom Latham (R-IA) sparred over the Administration’s proposal to scale back the per farm payment limit on commodity program direct payments and to reduce income thresholds for farm subsidy eligibility.  Despite protests from Latham, the Secretary did not back away from the proposals.

In response to questions from Reps. Rosa DeLauro (D-CT) and Norm Dicks (D-WA) regarding the impact of H.R. 1 (the FY 2011 CR passed by the House on February 19) on food safety inspections, Vilsack noted that the Food Safety Inspection Service (FSIS) budget “is predominantly personnel.”  As such, the $88 million cut to the FSIS budget included in H.R.1 would have an immediate effect on inspectors and other employees.

Vilsack was also asked about how H.R. 1 and the President’s FY 2012 budget request would impact USDA’s research budget.  He responded by noting that because Congress and the Administration have shunned earmarks, which have funded research and especially research facilities in the past, overall research funding will be down, requiring careful prioritization.

In addition to food safety and research, members of the Subcommittee raised a number of concerns related to conservation and feeding and nutrition programs.  Regarding SNAP (food stamps), Vilsack noted that the error rate in the payment of SNAP benefits is low, around 4 percent, and that 60 percent of those errors are overpayments, while 40 percent are underpayments.

On conservation, Vilsack explained that the President’s FY 2012 budget request prioritizes spending in order to get “the best bang for the conservation buck.”  The FY 2012 Budget Request proposes significant cuts to conservation programs, including some permanent cuts and some all-out eliminations.  Click here to read NSAC’s analysis of the President’s budget request.

In his prepared statement, the Secretary emphasized his rural regional innovation initiative, a plan that would use five percent of ten existing rural development programs to support regional economic and job creation strategies including local and regional food systems, renewable energy, broadband, natural resource-based development through competitive grants.  The Administration’s budget includes a request for a $5 million increase for Rural Business Opportunity Grants to support planning grants to foster these strategies.

Toward the end of the hearing, Subcommittee Chairman Jack Kingston (R-GA) suggested that the Conservation Reserve Program, the largest and most costly of the farm bill conservation programs, should be on the table for FY 2011 and FY 2012 cuts, arguing that the program is “very oversubscribed” and that it is no longer focused on environmentally sensitive land.  Vilsack responded by noting that because crop prices are so high, USDA is actually focusing more on highly erodible land than in the past.

Finally, Rep. Sam Farr (D-CA), ranking member on the Subcommittee, asked the Secretary how USDA plans to invest in organic agriculture.  “Between research, exports, marketing, promoting the co-existence of organic and genetically engineered (GE) agricultural products, and the Agency’s Organic Initiative, USDA is already investing in organic agriculture,” Vilsack said.

USDA’s Inspector General Phyllis Fong testified before the same Subcommittee on Wednesday.  Fong explained that the three primary areas of focus right now for the Office of Inspector General (OIG) are: (1) oversight of American Recovery and Reinvestment Act spending; (2) strengthening food safety; and (3) addressing improper payments, or instances in which the USDA paid out program money to unqualified recipients.

Many of the questions asked by members of the Subcommittee focused on a lack of action to address the fraud and improper payments OIG has identified.  Chairman Kingston (R-GA) and Ranking Member Farr (D-CA) both asked for information about improper farm program payments and farm program fraud.  Fong responded that the OIG is looking into these concerns.

Rep. DeLauro asked about food safety and  in particular to a study on e. coli in beef that she was responsible for getting into legislation last fall.  Fong said that the agency still lacks the prevalence rates of e. coli in beef and thus that the study is ongoing.  DeLauro also noted that the government relies on industry to provide food safety data and the Inspector General responded that it would be ideal to have food safety inspectors in plants collecting data and providing results directly to the Food Safety Inspection Service (FSIS).

Rep. Farr asked about an investigation into a fertilizer dealer in California who switched out organic ingredients for non-organic ingredients.  Fong responded that investigations are still underway and that California is taking a proactive approach to prevent such issues in the future.  She added that there are more audits planned for organic dairy and crop insurance.  Farr stated that he appreciates all such audits for organics because consumers respect the organic label.

When asked about the implications of H.R. 1, the Inspector General reported that if it became law her office would have to furlough the entire staff on a rolling basis for six weeks, meaning that only the highest priorities would be addressed.