SPEAKERS CONTENTS INSERTS
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FORMULATION OF THE 2002 FARM BILL
(FORESTRY, FOOD STAMPS)
SUBCOMMITTEE ON DEPARTMENT OPERATIONS,
OVERSIGHT, NUTRITION, AND FORESTRY
COMMITTEE ON AGRICULTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTH CONGRESS
JUNE 12, 27, 28, 2001
Serial No. 10710
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Printed for the use of the Committee on Agriculture
For sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpo.gov Phone: (202) 5121800 Fax: (202) 5122250
Mail: Stop SSOP, Washington, DC 204020001
COMMITTEE ON AGRICULTURE
LARRY COMBEST, Texas, Chairman
JOHN A. BOEHNER, Ohio
BOB GOODLATTE, Virginia
RICHARD W. POMBO, California
NICK SMITH, Michigan
TERRY EVERETT, Alabama
FRANK D. LUCAS, Oklahoma
SAXBY CHAMBLISS, Georgia
JERRY MORAN, Kansas
BOB SCHAFFER, Colorado
JOHN R. THUNE, South Dakota
WILLIAM L. JENKINS, Tennessee
JOHN COOKSEY, Louisiana
GIL GUTKNECHT, Minnesota
BOB RILEY, Alabama
Page 3 PREV PAGE TOP OF DOCMICHAEL K. SIMPSON, Idaho
DOUG OSE, California
ROBIN HAYES, North Carolina
ERNIE FLETCHER, Kentucky
CHARLES W. ''CHIP'' PICKERING, Mississippi
TIMOTHY V. JOHNSON, Illinois
TOM OSBORNE, Nebraska
MIKE PENCE, Indiana
DENNIS R. REHBERG, Montana
SAM GRAVES, Missouri
ADAM H. PUTNAM, Florida
MARK R. KENNEDY, Minnesota
CHARLES W. STENHOLM, Texas,
Ranking Minority Member
GARY A. CONDIT, California
COLLIN C. PETERSON, Minnesota
CALVIN M. DOOLEY, California
EVA M. CLAYTON, North Carolina
EARL F. HILLIARD, Alabama
TIM HOLDEN, Pennsylvania
SANFORD D. BISHOP, Jr., Georgia
BENNIE G. THOMPSON, Mississippi
JOHN ELIAS BALDACCI, Maine
MARION BERRY, Arkansas
Page 4 PREV PAGE TOP OF DOCMIKE McINTYRE, North Carolina
BOB ETHERIDGE, North Carolina
LEONARD L. BOSWELL, Iowa
DAVID D. PHELPS, Illinois
KEN LUCAS, Kentucky
MIKE THOMPSON, California
BARON P. HILL, Indiana
JOE BACA, California
RICK LARSEN, Washington
MIKE ROSS, Arkansas
ANÍBAL ACEVEDO-VILÁ, Puerto Rico
RON KIND, Wisconsin
RONNIE SHOWS, Mississippi
WILLIAM E. O'CONNER, JR., Staff Director
LANCE KOTSCHWAR, Chief Counsel
STEPHEN HATERIUS, Minority Staff Director
KEITH WILLIAMS, Communications Director
Subcommittee on Department Operations, Oversight, Nutrition, and Forestry
BOB GOODLATTE, Virginia, Chairman
RICHARD W. POMBO, California
Page 5 PREV PAGE TOP OF DOC Vice Chairman
JERRY MORAN, Kansas
JOHN COOKSEY, Louisiana
MICHAEL K. SIMPSON, Illinois
DENNIS R. REHBERG, Montana
ADAM H. PUTNAM, Florida
EVA M. CLAYTON, North Carolina,
Ranking Minority Member
MARION BERRY, Arkansas
ANÍBAL ACEVEDO-VILÁ, Puerto Rico
EARL F. HILLIARD, Alabama
TIM HOLDEN, Pennsylvania
JOHN ELIAS BALDACCI, Maine
BRENT W. GATTIS, Subcommittee Staff Director
C O N T E N T S
Clayton, Hon. Eva M., a Representative in Congress from the State of North Carolina, opening statement
Goodlatte, Hon. Bob, a Representative in Congress from the Commonwealth of Virginia, opening statement
JUNE 12, 2001
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Fledderman, Robert, Forest Resources Manager, Forest Resources Division, Westvaco Corporation, Summerville, SC
Hayes, Lark, Senior Attorney, Southern Environmental Law Center, Chapel Hill, North Carolina.
Larson, L. Keville, president, Forest Landowners Association, Mobile, AL
Leavell, Chuck, member, American Tree Farm System, Dry Branch, GA
Reid, C.P.P. (Patrick), president-elect, National Association of Professional Forestry Schools and Colleges, Tucson, AZ
Smith, David, vice-president, Society of American Foresters, Blacksburg, VA
The Intertribal Timber Council, statement
Smith, Dave, National Council on Private Forests, statement
JUNE 27, 2001Food Stamps
Clayton, Hon. Eva M., a Representative in Congress from the State of North Carolina, opening statement
Goodlatte, Hon. Bob, , a Representative in Congress from the Commonwealth of Virginia, opening statement
Page 7 PREV PAGE TOP OF DOCWitnesses
Bost, Eric M., Under Secretary, Food, Nutrition, and Consumer Services, U.S. Department of Agriculture
Brunty, Coeli, Food Stamp Program participant, Emmitsburg, MD
Dean, Stacy, director, food stamp and immigrant policy, Center on Budget and Policy Priorities, Washington, DC
Friedman, Jerry W., executive deputy commissioner, Texas Department of Human Services, Austin, TX
Haskins, Ron, senior fellow, Brookings Institution, Washington, DC
Howard, Douglas E., director, Michigan Family Independence Agency, Lansing, MI
Levin, Hon. Sander M., a Representative in Congress from the State of Michigan
Nelson, Claryce H., State coordinator for consumer issues, AARP, Washington, DC
Ohls, James, senior fellow, Mathematica Policy Research, Inc., Washington, DC
Page 8 PREV PAGE TOP OF DOC Rector, Robert, senior research fellow, Heritage Foundation, Washington, DC
Reinert, Jenifer, secretary, Wisconsin Department of Workforce Development, Madison, WI
Rivero, Sonia, commissioner, Virginia Department of Social Services, Richmond, VA
Robertson, Robert E., Director, Education, Workforce and Income Security Issues, General Accounting Office, Washington, DC
Ryan, Elaine M., acting executive director, American Public Human Services Association, Washington, DC
Savner, Rich, director, public affairs and government relations, Pathmark Stores, Inc., Carteret, NJ, on behalf of the Food Marketing Institute
Viadero, Roger C., Inspector General, Office of the Inspector General, U.S. Department of Agriculture, Washington, DC
Wagstaff, Bruce, deputy director, Welfare Work Divisions, California Department of Social Services, Sacramento, CA
Page 9 PREV PAGE TOP OF DOCSubmited Material
Alameda County Community Food Bank, et al., statement
American Public Human Services Association, statement
Hall, Hon Tony P, a Representative in Congress from the State of Ohio, statement
National Governors Association, statement
Sanders, Hon. Bernard, a Representative in Congress from the State of Vermont, statement
Turner, Jason A., commissioner, Human Resources Administration, the city of New York, NY, statement
United Fresh Fruit and Vegetable, statement
Walsh, Hon James T., a Representative in Congress from the State of New York, statement
JUNE 28, 2001Forestry
Clayton, Hon. Eva M., a Representative in Congress from the State of North Carolina, opening statement
Goodlatte, Hon. Bob, a Representative in Congress from the Commonwealth of Virginia, opening statement
Bendfeldt, Eric, extension agent, Environmental Sciences, Virginia Cooperative Extension Service, Harrisonburg, VA
Berkland, Mark, Director, Conservation Operations, Natural Resources Conservation Service, U.S. Department of Agriculture
Page 10 PREV PAGE TOP OF DOC Hefferan, Colien, Administrator, Cooperative State Research, Education, and Extension Service, U.S. Department of Agriculture
Hubbard, Jim, legislative committee chair, Colorado State Forester, National Association of State Foresters, Washington, DC
Rains, Michael T., Deputy Chief, State and Private Forestry, Forest Service, U.S. Department of Agriculture
Rohall, Ronald, consulting forester, National Forestry Policy Committee, National Association of Conservation Districts, Washington, DC
Shay, Russell, subnitted statement
FORMULATION OF THE 2002 FARM BILL
TUESDAY, JUNE 12, 2001
House of Representatives,
Subcommittee on Department Operations,
Oversight, Nutrition and Forestry,
Committee on Agriculture,
The subcommittee met, pursuant to call, at 10:08 a.m., in room 1300, Longworth House Office Building, Hon. Bob Goodlatte (chairman of the subcommittee) presiding.
Page 11 PREV PAGE TOP OF DOC Present: Representatives Rehberg and Clayton.
Staff present: Brent Gattis, subcommittee staff director; Callista Gingrich, clerk; Claire Folbre, Susanna Love, and Walter Vinson.
OPENING STATEMENT OF HON. BOB GOODLATTE, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF VIRGINIA
Mr. GOODLATTE. Good morning. Today we convene the Subcommittee on Department Operations, Oversight, Nutrition and Forestry to hear testimony on the forestry provisions of the 2002 farm bill.
This subcommittee has the responsibility for determining what kinds of forestry provisions will be included in the next farm bill and ultimately what the landscape of Forest Service programs available to private landowners will look like over the next decade. It is our task to create a path through what may look like a wooded thicket of programs, regulations, and red tape towards sustainable land management on both public and private lands.
This is a very exciting time to be involved in forest policy as we look at the new farm bill and a new opportunity to alter, keep, and create Forest Service authorizations. We must take this opportunity to closely examine those programs already authorized in past pieces of legislation and look at the present and future challenges to determine priorities for the 2002 farm bill.
I look forward to hearing from the witnesses their ideas about what has worked and what hasn't in past farm bills and to hear about any new potential programs that may have a place in the upcoming bill.
Proper forest management is vital to the health of our forests and our communities. My home State of Virginia is covered by 167 million acres of forested land; 77 percent of these forests are owned by farmers and other private non-industrial landowners. I believe we have a wonderful opportunity and a responsibility to support programs that reach out to these private landowners as well as continue to support and sustain our Federal and State lands.
Page 12 PREV PAGE TOP OF DOC Nationally, 54 percent of America's forests are owned by private individuals. These lands provide us with a plethora of products and recreational opportunities and an immeasurable quantity of clean air, clean water and habitat for both animals and people. The farm bill is about helping our neighbors and helping our country sustain itself on the land. The land gives us many things, from corn and beans and grass for pasture, to trees for shelter, recreation, and a clean environment.
I believe strongly that forestry should play an important role in the development of a new farm bill and I look forward to working closely with all of the interested parties to fully consider these programs, and most especially our ranking member, Mrs. Clayton of North Carolina, who I am now pleased to welcome.
OPENING STATEMENT OF HON. EVA M. CLAYTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NORTH CAROLINA
Mrs. CLAYTON. Thank you, Mr. Chairman. Good morning, panelists. I want to thank you, Mr. Chairman, for convening this hearing and soliciting the views of the leaders and those who are activists in the whole area of our forests. It is indeed an opportune time as we consider the farm bill to begin to understand and appreciate and make assessment of what things are working and the reflection of how our forests have changed and how the dynamics and the challenges for the new century may cause us also to look at new programs and new opportunities.
In reviewing the testimony of some the witnesses, I was reminded about the drastic shift in terms of forestry and where that has happened. Mr. Chairman, it is moving south, I must say, in terms of the areas. You are correct in terms of the percentage of landowners privately as compared to what are owned by the Government, but even more drastic is a shift now moving from the Midwest and the West to the Southeast. And my State happens to be one of the four States that seem to be far more active in that area.
Page 13 PREV PAGE TOP OF DOC So if we are going to maintain the kind of sustainability and the future enjoyment for future generations, I think we are challenged with looking at how do we provide the kind of incentives and the technical assistance to these new trustees and the future owners of the forests for the future. So we need to empower them with information. We need to engage them in formulating strategies that not only will allow them to prosper in terms of their own tilling and the laboring of the soil, but also they can transfer the goods that the trees have in terms of recreation, esthetic, and environment to their heirs in future generations. So I think we have a unique opportunity to reflect, to see what there is, but also to indeed prepare for the future.
Mr. Chairman, I ask unanimous consent to put my statement into the record later.
Mr. GOODLATTE. Without objection it is so ordered.
[The prepared statement of Mrs. Clayton follows:]
PREPARED STATEMENT OF HON. EVA M. CLAYTON
Thank you Mr. Chairman for holding this hearing on the role of forestry within our agricultural economy and on how we can update and improve our forestry programs at the Department of Agriculture.
Ordinarily, when people think of agriculture, they tend to conjure up images of amber waves of grain rather than stands of pine groves. In fact, many people are surprised to learn that, after corn, forestry is our Nation's leading commodity, with sales of $22 billion per year. Given the important role that forestry plays in our Nation's economy, the lack of attention that we pay to it as an agricultural product is striking. Today's hearing will allow us an opportunity to remedy this shortcoming to some extent.
This hearing is especially pertinent today for our subcommittee given that the chairman of the subcommittee hails from Virginia and that I come from the great State of North Carolina. It is a little known fact that the Southeast has become the most intensively cut region of the United States, leading some to refer to it as the ''fiber basket of the world.'' In fact, as the testimony of Ms. Hayes points out, harvest levels in the Southeast have increased by 50 percent in the past 20 years. This has come at a time when timber harvests have been slowing in many other parts of the country.
Page 14 PREV PAGE TOP OF DOC This raises serious questions about the sustainability of our southeastern forests. It is my hope that the upcoming farm bill will enable us to address these matters with equal concern for those who profit economically from the strategic use of our forest resources and those who derive benefits from alternative uses of our forest lands that are dependent upon the long-term preservation of our resource base.
There are some people who will try to polarize the issues at stake here, painting conservationists concerned about the future of our forests and private landowners who seek to manage their lands for profit as equally unwilling to consider the views of each other. That is often how views are framed here in Washington.
However, it is critical to recognize that all of us have a stake in the future of our forests. It is small-minded to move forward on these discussions about the future of our forests with a ''winner takes all'' mentality.
In reading through the testimony presented today, I was struck by the degree of agreement among all of our witnesses. In spite of the wide range of experience and interests testifying here today, a number of themes emerged that we must remember as we move forward with our consideration of our farm programs.
First, we must significantly increase the amount of resources that we devote to forestry. As noted earlier, forests constitute a very significant portion of our agricultural output, yet the funding that they receive is next to nothing. It is telling that, while many row crops and commodities receive mandatory funding, our forestry programs have been required to struggle for resources within the discretionary appropriations process.
The chronic lack of resources afforded to forest management takes on even greater significance when considered alongside the shift of our forestry from public to private lands. Quite simply, the shift from public to private lands will require that we provide private landowners with management resources. It is simply not possible to take a ''one size fits all'' policy that works well on our National Forests and to transport it in identical form to private lands. Private lands will require a different kind of resources, namely in the form of technical assistance and planning.
Page 15 PREV PAGE TOP OF DOC This brings us to the second area of agreement. The testimony presented today is consistent in its insistence that private landowners are poorly informed about how best to manage their land and thus require training and technical assistance in their efforts to be good stewards. Providing this technical assistance is important no matter which direction landowners choose to take.
For those who choose to harvest their lands, sound technical assistance and forest planning can help them to do so in a way that is beneficial both to their bottom line as well as to the long-term health of the forests. For others, up-front technical assistance will enable them to see that preserving their land for alternative uses, such as wildlife or recreation, will ultimately be a more prudent decision both for the landowners and for those to whom they hope to pass along their land.
I am not so naive as to believe that everyone on this subcommittee shares precisely the same beliefs as to how to move forward with our review of forestry policy. There is clearly some divergence of opinion as to the definition, nature, and degree of accountability and performance measures that are necessitated on our private lands. However, I am nonetheless encouraged to see that we begin this process with common ground and a shared concern from all parties that current Federal policy is poorly attuned to the needs of private landowners in terms of both resources and technical assistance.
I look forward to moving forward with my colleagues on these matters as we continue our work on the farm bill and the role of forestry policy within it.
Mr. GOODLATTE. Our program for this hearing of the Subcommittee on Department Operations, Oversight, Nutrition, and Forestry is to have one panel of witnesses, which are already at the table and I will introduce them now.
We first have Mr. Robert Fledderman, environmental manager, forest resources division, Westvaco Corporation, from Summerville, South Carolina. Dr. David Smith, vice-president, Society of American Foresters in Blacksburg, Virginia, very close to my district. Mr. Chuck Leavell, member of the American Tree Farm System in Dry Branch, Georgia, and wearing a different hat than many of us know him from the Rolling Stones. Dr. Patrick Reid, president-elect, National Association of Professional Forestry Schools and Colleges, Tucson, Arizona. Mr. L. Keville Larson, president, Forest Landowners Association, Mobile, Alabama. And Ms. Lark Hayes, senior attorney, Southern Environmental Law Center, Chapel Hill, North Carolina.
Page 16 PREV PAGE TOP OF DOC I would like to welcome all of you today and let you know your written statements will be made a part of the record. And we would be pleased to receive your testimony at this point, which we would ask that you attempt to limit to 5 minutes. Starting with Mr. Fledderman, welcome.
STATEMENT OF ROBERT FLEDDERMAN, ENVIRONMENTAL MANAGER, FOREST RESOURCES DIVISION, WESTVACO CORPORATION, SUMMERVILLE, SC
Mr. FLEDDERMAN. Thank you, Mr. Chairman. I appreciate the opportunity to testify today on the forest industry's perspective to reauthorize and enhance the forestry programs in the farm bill. Congress has a great opportunity here to promote sustainable forest management. I am speaking today on behalf of Westvaco as well as the membership of the American Forest and Paper Association.
Westvaco is a major manufacturer of paper packaging and speciality chemicals, employing 18,000 men and women. The company owns and manages nearly 1.3 million acres of forestlands in the United States and in adherence with the Sustainable Forestry Initiative Program, or SFI, our holdings support mill operations in six southeastern States.
Additionally, Westvaco foresters work with 2,800 private landowners in our Landowner Assistance Program that is designed in part to educate landowners about sustainable forestry. These private landowners together own almost 1.4 million acres.
I mentioned the SFI program which is a comprehensive system of principles, guidelines, and performance measures that integrates the perpetual growing and harvesting of trees with protection of wildlife, fish, plants, soil and air, and water quality. Today there are over 100 million acres enrolled in the program. Congress has a tremendous opportunity in the farm bill to assist non-industrial private forest landowners striving to achieve sustainable forest management, much as the SFI does for industrial lands.
Page 17 PREV PAGE TOP OF DOC In the past decade, dramatic shifts have taken place in forest dynamics, including intensified global competition, the virtual locking up of America's national forests, greater dependence on private landowners to supply wood products, and State forest agencies taking on greater responsibilities to protect forest resources in addition to their traditional role of fire prevention and suppression.
Despite these changing dynamics, direct Federal assistance to non-industrial private forest landowners is a scant $6 million, representing less than one-half of 1 percent of all commodity support.
It is appropriate at this time to reassess the Nation's commitment to sustainable forestry and determine how programs can be enhanced and improved. Today only 10 percent of private forest landowners use a professional forester when harvesting their timber. Current education and outreach programs on sustainable forestry are insufficient to meet current needs. And looking ahead, given the expected increase in the number of forest landowners, the Nation will need an upgraded delivery system for forestry program and services.
The primary delivery mechanism for forestry programs is through the Forest Stewardship Program. I have two suggestions to improve the program. First, build the capacity of State forestry agencies to assist forest landowners in sustainable forest management. Second, allow technical assistance to meet the requirements of Federal mandates. Specifically, the Forest Stewardship Program should be adjusted to provide State foresters with the authority to focus resources and technical assistance on priorities established through their offices, State forestry technical committees, and in cooperation with local communities.
Additionally, express authority should be given to State foresters or their equivalent to prepare grants and seek outside proposals to promote sustainable forestry programs on private non-industrial land. In concert with many of the State foresters, we support increased spending for the program as well as building in more flexibility. The only Federal program providing direct financial assistance is the Forestry Incentives Program, or FIP. FIP provides cost-share funds for tree planting, site appropriation and things. While we believe there is an essential element of sustainable forestry, it is only a small part of the myriad of practices that together achieve sustainable management.
Page 18 PREV PAGE TOP OF DOC The Stewardship Incentives Programs, or SIP, another cost-share assistance program is designed to enroll private non-industrial forest landowners into a program that requires written management plans. Due to a variety of Federal requirements, State foresters found most landowners were not interested in this program. Congress has not funded SIP in recent years.
To enhance all sustainable forestry practices, we believe it is time to combine FIP and SIP to create a single integrated program called the Sustainable Forestry Incentives Program or SFIP. The new SFIP program should be flexible enough to encourage private landowners to conduct a variety of environmental beneficial forestry practices; for example, professional forestry assistance, conservation easements on lands threatened by development pressures, longer education and training, invasive pest control, fire hazard reduction and wildlife and fish habitat enhancement.
The ultimate goal of the SFIP will be to entice non-industrial private forest landowners to participate in programs and then explain the benefits of developing written management plans. This type of program would require substantial financial support from Congress.
A new and improved forestry title should link State forestry agency programs into a comprehensive effort to address forest sustainability. It should allow State foresters to work with landowners and their fellow State agencies, while providing administrative flexibility to target resources to those on the ground, challenges that are most urgently needed.
The single most useful thing we can do to better protect our environment is to maintain our private forestland base. This is a difficult task with increasing development pressures and growing regulatory constraints. I submit that the best way to protect forestland is to enable private landowners to profitably manage their lands while using sustainable forestry techniques. I believe the program changes we propose here, along with the increased funding, amount to a significant first step in reaching that goal.
Page 19 PREV PAGE TOP OF DOC Mr. Chairman, that concludes my remarks. I will be glad to take any questions.
[The prepared statement of Mr. Fledderman appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. Now we are pleased to welcome Mr. Smith.
STATEMENT OF DAVID SMITH, VICE-PRESIDENT, SOCIETY OF AMERICAN FORESTERS, BLACKSBURG, VA
Mr. SMITH. Thank you. Mr. Chairman, members of the committee, my name is David Smith.
I come before you to discuss an underutilized potential resource to achieve forest sustainability in this Nation, namely non-industrial private forest landowners. They are absolutely essential to the sustainability of our Nation's forests, and there are significant opportunities to help them realize their potential.
SAF is proposing two major initiatives and changes to existing Federal conservation programs in order to improve the sustainability of the Nation's forests. The two initiatives are: One, the Sustainable Forestry Initiative Program, an effort to provide incentives to private landowners beyond commercial activities; and, two, the Sustainable Forestry Outreach Initiative which would be a targeted campaign to educate forest landowners about sustainable forestry and the importance and availability of professional forestry assistance, and other opportunities.
My testimony is modeled after a working paper developed by the National Council on Private Forests. The NCPF is a collection of organizations interested in private forestry. These organizations have come together to articulate a common set of principles regarding farm bill programs, and I would like to submit their working paper for the record.
Page 20 PREV PAGE TOP OF DOC NIPF landowners own approximately 363 million acres or nearly one-half of the Nation's forestland. This is an area twice the size of Texas and 14 times the size of the State of Virginia. These forests provide important public benefits, including wildlife habitat, clean water, recreational opportunities, open space, clean air, and other environmental benefits. They also provide important forest products. In fact, NIPF lands provided almost 60 percent of the Nation's timber harvest in 1996, and as timber harvests on National Forests continue to decline, the number of private landowners harvesting timber continues to grow. However, the most optimistic studies show that almost 10 percent of the estimated 9.9 million non-industrial private landowners consult a professional forester prior to harvest. Landowners are making important business transactions without using professional advice. These lands are the least intensively managed of any forest ownership category in the Nation. Much of this land in timber sales follows an unusual event in the owner's life, often in response to a personal situation such as a college education, illness, retirement, or other financial needs. NIPF landowners need technical advice and most are not even aware of this need.
The two major initiatives and changes to assisting Federal conservation programs being proposed are major steps in ensuring the sustainability of our Nation's forests, and will further strengthen existing partnerships among Federal and State agencies, colleges and universities, and professional organizations.
The first, the Sustainable Forest Incentive Programs will provide Federal funding to implement conservation practices that benefit the public. The program must be complementary to efforts to provide educational outreach on sustainable forestry and offer technical assistance to landowners. The program would fund a broad array of practices such as wind breaks, forested wetland management, control of invasive species, and fire protection that landowners typically do not implement due to lack of financial resources, and an integrated delivery mechanism combining financial assistance, technical assistance, and educational outreach to implement these conservation practices.
Page 21 PREV PAGE TOP OF DOC The second, the Sustainable Forestry Outreach Initiative the goals of which for forest landowners to inform them of the value and benefits of practicing sustainable forestry, the importance of professional forestry advice to achieving their objectives, and the variety of public and private sector resources available to assist them in implementing sustainable forestry.
The outreach effort would be funded through USDA CREES, or Extension, and implemented with the assistance of SAF, members of the SAF, the State foresters and university partners. A major thrust initiative would be the reauthorization and expansion of the Renewable Resources Extension Act.
A second major emphasis will be to enable nongovernment organizations to deliver forestry advice and expertise. The goal would be to reach a substantial number of the 4.1 million individuals and families who own forested tracts larger than 10 acres. There will be specific emphasis on peer-to-peer learning and outreach. The effort will allow landowners to explore opportunities to improve the condition of their land and improve the value of their property, provide public benefits by improved forestlands, all at a minimal cost to the Government because we are largely using private sector dollars and programs to get the work done.
Finally, we recommend that forestry be an explicit goal of all traditional conservation programs authorized in the farm bill. We can reap major conservation and environmental benefits from practices of forestry, and these programs ought to be actively encouraged for forestry.
Mr. Chairman, members of the committee, I thank you for the opportunity to appear before you today. The Society of American Foresters and its 17,500 members are dedicated to the sustainable management of our forests for all of the uses and values, and we shoulder a significant responsibility for implementing forest management practices that are based on the best science and experience that is available. Thank you.
Page 22 PREV PAGE TOP OF DOC [The prepared statement of Mr. Smith appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. Mr. Leavell, welcome.
STATEMENT OF CHUCK LEAVELL, MEMBER, AMERICAN TREE FARM SYSTEM, DRY BRANCH, GA
Mr. LEAVELL. Thank you, Mr. Chairman. I would like to ask permission to make my written statement a part of the record along with some other brief documents.
Mr. GOODLATTE. Without objection, it will be.
Mr. LEAVELL. Thank you.
Mr. Chairman, I am here to represent myself, my wife Rose Lane, as well as the 65,000 members of the American Tree Farm System. All of us have pledged to manage our forestland for water quality, for wildlife and for recreation. And we do it so that our kids and our neighbors' kids can enjoy the same healthy, thriving forest that we enjoy today. Together we own about 26 million acres of the most beautiful, diverse forestland in the country. But frankly, to quote that great American, Kermit the Frog, ''It ain't easy being green''.
Mr. Chairman, I would like to briefly tell about our story at Shore Lane Plantation. My wife inherited some 1,200 acres back in 1981 from her grandmother. This was land that her grandfather had purchased in the thirties. Things were a lot different in 1981, I realize that, and certainly inflation was different, interest rates were different, and the estate tax situation was different. But I can tell you from a personal standpoint that it was a struggle to keep that land, and in fact we had to sell a portion of it in order to keep the bulk of it. And it was also a struggle to rebuild that land.
Page 23 PREV PAGE TOP OF DOC How does all this relate to the farm bill? Well, first of all, people like Rose Lane and I are the majority owners of our Nation's forests. There are also 10 million of us altogether: teachers truck drivers, lawyers, doctors, Congressmen, Senators, even former Presidents.
The number of people who own forestland is growing very rapidly, but the size of the woodlands is shrinking. Over the past 50 years, the average size of a family-owned woodlot has shrunk to less than 20 acres. At the same time, more and more people are living far away from their forestland. Rose Lane and I learned about our forests, but most forest owners today don't really know all that much about sustainable forestry. Only 5 percent or so are have a written plan that provides for the future of their forest.
Finally, even though most forest owners aren't experts in the practice of sustainable forestry, their hearts are certainly in the right place. And I am convinced that, like me and Rose Lane, most of these folks would practice the best kind of sustainable forestry if they could. And that is the problem. Right now, there are a lot of pressures and problems that make it harder, not easier, for folks to be ''green.'' sprawl and development is one. Land values are skyrocketing in the outer suburbs where forests meet cities. Helping forest owners sustain the income stream they need to sustain their forests is critical. Otherwise, I can tell you from my own experience, the economics are all wrong.
Another roadblock to sustainability is education and outreach. We need to do much more in the way of outreach and education to get the millions of uninvolved forest landowners on the pathway towards sustainability. Once folks take that first step toward sustainability, they will soon discover that the next steps require a good deal of technical assistance and, for most of us, some financial assistance as well. But right now, Federal programs and incentives provided for forest owners are meager, fragmented, and often delivered in a way that limits the number of forest owners they can serve.
Page 24 PREV PAGE TOP OF DOC Many of the conservation programs already in place do not place a high enough priority on conserving and sustaining forests, so forest owners are almost always stuck at the back of the line and very rarely do they make it to the front of the line. And I know because that is what happened to us. We need to change all that.
With other members of the National Council on Private Forests, we would ask to you consider the following: consolidating and expanding the Forestry Incentives Program and Stewardship Incentive Program into a new Sustainable Forestry Incentives Program. We recommend that this new program be funded through mandatory funding at $150 million a year, that the funds be available for a broad range of conservation practices, that it be administered through State forestry agencies and stewardship committees that represent forest landowners, and that it be organized so that the administrative costs are minimized.
Rose Lane and I know how important it is to put Federal dollars to work on the ground and not back at the office. We also ask that you consider creating a new sustainable Forestry Outreach Initiative that can provide education and technical assistance. We at the American Tree Farm System believe strongly in the power of peer-to-peer mentoring, that one exemplary steward can lead his or her neighbors towards sustainability, So we urge that the initiative provide for nongovernmental organizations like tree farms to play a key role. And finally, we urge you to make sustainable forestry and forest conservation a priority goal for all the USDA conservation programs that are already in place, so like other rural landowners, we can keep our woodlands producing wood as well as the other public benefits that come from the forests.
Mr. Chairman, I have just written a book about sustainable forestry and what it means to us, and we named it Forever Green. That is like our philosophy of conservation. It is in that same spirit that we offer these recommendations today to keep our Nation's forests working intact and, indeed, forever green. Thank you, Mr. Chairman.
[The prepared statement of Mr. Leavell appears at the conclusion of the hearing.]
Page 25 PREV PAGE TOP OF DOC Mr. GOODLATTE. Thank you Mr. Leavell. I will be sure to get a copy.
STATEMENT OF C.P.P. (PATRICK) REID, PRESIDENT-ELECT, NAPFSC, AND DIRECTOR, SCHOOL OF RENEWABLE NATURAL RESOURCES, UNIVERSITY OF ARIZONA
Mr. REID. Thank you, Mr. Chairman, members of the subcommittee. I am director of the School of Renewable Natural Resources at the University of Arizona. But I am here in my capacity as president-elect of the National Association of Professional Forestry Schools and Colleges. We are often known by our acronym, NAPFSC. NAPFSC is comprised of 67 universities that conduct the Nation's research, teaching and extension programs in forestry and natural resource management. NAPFSC schools work in close partnership with the USDA research programs through extramural contracts and cooperative agreements. In representing NAPFSC, I also have the privilege of serving as the Chair of the National Coalition on Sustaining America's non-Federal forests.
NAPFSC certainly appreciates the opportunity to provide this testimony on our priority farm bill issues. First of all I would like to convey a sense of urgency in regard to this Nation's non-Federal forestlands and its private landowners, and to emphasize the importance of research, education, and extension efforts by our public universities. In early 1999, NAPFSC was one of several organizations that helped establish the National Coalition for Sustaining America's non-Federal Forests. This was in response to a growing national awareness and concern for the many issues and problems facing the sustainability of the more than 487 million acres of non-Federal forestland in this country. This is approximately two-thirds of the total forestland in this Nation.
Page 26 PREV PAGE TOP OF DOC The sustainability and stewardship of these non-Federal forestlands are economically, environmentally, and socially vital to this Nation. Today these non-Federal forestlands are threatened by urbanization, fragmentation, forest health problems, and increasing harvesting pressures.
Exacerbating the issue of sustainability of these lands is a growing number of private forest landowners that are inexperienced in forest stewardship practices and thus ill prepared to make informed decisions about their forests. This past year, the National Coalition for Sustaining America's non-Federal Forests documented a plan of action to conserve and sustain our Nation's non-Federal forestland, a plan that NAPFSC fully endorses. The Coalition's report, dated June 2000, ''A National Investment in Sustainable Forestry,'' has recently been sent to every Member of Congress. This report stresses the importance of cooperation among the public universities, State forestry agencies, Federal agencies, NGOs and the many forestland stakeholders. Key elements of this plan are research capacity and concerted effort on stakeholder priorities. The report documents the need for substantial investment to provide the science foundation for the sustainability of these forests, the need to transfer this knowledge into on-the-ground management and conservation practices, and the need to build professional capacity in every forested region of this Nation.
Based on this report, NAPFSC recommends the incorporation of a forestry title in the farm bill with a subtitle dealing with research, education, and extension. Furthermore, we recommend that the forestry title emphasize the need for a national initiative for stewardship and sustainability of America's non-Federal forests. Our NAPFSC institutions believe that research, education, and extension are prerequisites for non-Federal forest sustainability. Historically, our Nation's state colleges and universities, particularly those with land grant status, have been principal providers of non-Federal forestry and natural resources research, education, and extension. These institutions possess the expertise and infrastructure to conduct research and educational programs to transfer new knowledge to forest landowners and to provide the trained professionals we will need for research extension and implementation of new and improved practices.
Page 27 PREV PAGE TOP OF DOC Our recommendations for the farm bill basically suggest ways to attain three major goals:
First, a foundation of research-based knowledge that allows informed decision-making on the management and conservation alternatives necessary to achieve the objectives of America's non-Federal forest landowners and society at large.
Second, a cadre of forestry source professionals with the skills necessary to address the needs of all segments of our society, especially those that manage and provide stewardship on non-Federal forestlands.
And finally, an established and effective extension and outreach infrastructure that provides timely delivery of knowledge-based products to those who must make management and policy decisions concerning non-Federal forestlands.
More specifically, we recommend increasing funding in the McIntyre-Stennis Cooperative Forestry Research Act, the National Research Initiative, and increasing collaborative research with the Forest Service. We need to increase our capacity to provide extension, education, technology transfer, and outreach to forest landowners, so we recommend reauthorization and expanding RREA and collaborative efforts with State and private forestry, the Forest Service and private stakeholders.
To meet the need for integration and coordination of research, education, and extension with Federal financial and technical assistance programs and to provide oversight for national initiatives on non-Federal forests, we recommend establishing a national advisory board on non-Federal forests and four regional research and educational centers.
In closing, we think these investments will make a difference and begin to lead us towards truly productive and sustainable non-Federal forests and increase the opportunity for the Nation. Thank you.
[The prepared statement of Mr. Reid appears at the conclusion of the hearing.]
Page 28 PREV PAGE TOP OF DOC Mr. GOODLATTE. Thank you. Mr. Larson. Welcome.
STATEMENT OF L. KEVILLE LARSON, PRESIDENT, FOREST LANDOWNERS ASSOCIATION, MOBILE, AL
Mr. LARSON. Thank you. Mr. Chairman, members of the committee, after 40 years of being a consultant forester and 30 years of being a forest landowner, I feel confident I am expressing some of the views of forest landowners and I am proud to be representing the Forest Landowners Association today. Most Federal and other public timberlands are managed with little or no emphasis to timber production. Most industrial timberland managed to maximize production. The remaining 50 to 60 percent of the Nation's timberland owned in nearly 10 million non-industrial private ownerships is free to be managed for a wide variety of objectives as set by the owners. These ownerships include farmers, investors, individuals, and many family combinations.
I know of one person who owns some land in his own name, another tracthe is not a large landowneranother small tract jointly with his wife, another tract with his brother and sister, and another one with cousins and brothers and sisters. There are a lot of combinations and a lot of parties involved.
It is nearly impossible to generalize about the circumstance, objectives, or reasons they own land. Some manage for timber, some use the property for recreation, and some are holding for development. However, it is safe to say that on the whole, no one takes better care of or values forestland more than these owners.
Today, non-industrial private forestlands are more diverse, better stocked, better managed than in any time in the past 100 years. Much of the improvement occurred while there were few regulations and while increasing amounts of timber were produced. In short, the history of private forestlands is a great success story. Credit for the success should go to the natural responses and reactions of non-industrial owners to the free market supply-and-demand forces and their interest in responsible management.
Page 29 PREV PAGE TOP OF DOC When asked what they need to do a better job, these owners, in conferences around the country, including the Seventh American Forest Congress, have said tax changes, information, and better markets are their highest priorities. They do not ask for handouts or landowner welfare. Of course, they are not fools, and if industryto keep prices lowand Government agenciesto expand their influence successfullylobby for a giveaway program, they will respond. They will stop spending their own money and may even delay plans to wait for free money. In addition, such tampering with supply and demand can result in imbalances like those in other agricultural commodities.
Many statistics are cited and reasons given as to why attention from the Government should be given to these lands. Such information should be considered carefully. For instance, over half of the 10 million ownerships consist of 1- to 99-acre size holdings and may not be viable for forest management.
The information that only 5 percent of landowners have a written management plan is often cited as proof that something must be done. This is an example of a highly misleading statistic: first, that management plans are always necessary. It is not universally accepted. Second, those 5 percent of the landowners represent 40 percent of the acres. Based on this kind of information, many well-meaning people advocate Government programs or money to solve perceived problems.
For years, much of the forestry community called non-industrial private forest owners a problem because they were not growing as much timber as others wanted. Their volume has nearly doubled in 35 years. Now the forest community says there are problems facing these owners such as fragmentation, urbanization, forest health, and programs must be created to help them. The way to help them is to reduce tax disincentives such as the death tax, highly destructive to timberlands, limitations on expensing and income averaging. Doesn't make sense for a small landowner who could only harvest timber once every 10 years to not be able to average that income.
Page 30 PREV PAGE TOP OF DOC Provide information, minimize regulations, don't interfere too much and let the market operate.
To summarize recommendations for guiding principles of the farm bill, and we have presented some written testimony, the Forest Landowners Association has always supported research and education as an appropriate role of Government. If there is any other program, we believe it should be incentive-based not a cash subsidy. If any payments or services are to be offered, it is especially important to follow the precedent of the 1950 Cooperative Forest Management Act, direct delivery through the private sector. It is more efficient.
Thank you for the opportunity to appear. I will be glad to discuss any questions you may have.
[The prepared statement of Mr. Larson appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. Ms. Hayes, we are pleased to have your testimony.
STATEMENT OF LARK HAYES, SENIOR ATTORNEY, SOUTHERN ENVIRONMENTAL LAW CENTER, CHAPEL HILL, NC
Ms. HAYES. Thank you. Mr. Chairman, members of the committee, my name is Lark Hayes and I am a senior attorney at the Southern Environmental Law Center in Chapel Hill, North Carolina. That organization is a regional environmental organization focused on the protection of the natural resources of six southeastern States from Virginia through the two Carolinas, Georgia, Alabama and Tennessee. Because the region in which we work is the largest timber-producing region of the country, is leading the Nation in the loss of forestland, and is home to the greatest number of remaining wetlands in the lower 48 States, we have an intense interest in the reauthorization of the farm bill.
Page 31 PREV PAGE TOP OF DOC I gather, like others here, an overarching point I would like to make from the outset is that the forestry-related programs have historically not received either the attention or the funding which we believe is badly needed to assist forest landowners and also to address a range of issues facing our Nation's private forestlands. Accordingly, we appreciate you holding this hearing today. Because my views are derived from my experience in the Southeast, I want to take just a minute to note some of the recent developments and projected trends. We think these are of national significance. Most importantly, the committee needs to understand that harvest levels in the Southeast have greatly intensified in the past 20 years, up 50 percent from mid1970 levels. As Mrs. Clayton noted, other parts of the country have been reducing their timber harvest, collectively down by a fourth.
Serious issues about the sustainability of forest resources in our region are being asked. Using the traditional approach of comparing growth versus grain or harvest levels, we already know that softwood harvests across our region are at unsustainable levels. And in States like mine and Mrs. Clayton's, North Carolina, the official projections are that all harvests, including hardwoods, will be unsustainable by the year 2005. For these reasons, our last Chief of the Forest Service regularly spoke out about the issue of sustainability of southeastern forests.
These increased harvest levels in our region are creating many different pressures on our forest resources, on habitat for wildlife and rare species, and on water quality. With that backdrop in mind, let me make a couple of suggestions and draw your attention to a couple of specific issues:
First, native forestland in our region is being lost at an alarming rate. The only Federal program that specifically addresses loss of forestland is Forest Legacy, but it has been historically very much underfunded, even though it is hugely popular. My recommendation and request is that this committee consider mandating a minimum level of annual funding for the Forest Legacy Program in the range of several hundred million a year.
Page 32 PREV PAGE TOP OF DOC My second concern is that the southeastern States, in my view, are poorly prepared in terms of forest policies and laws to address the potential environmental impacts of all of this increased harvesting. Most of these laws were prepared back in the era of mom-and-pop forestry, if you will, and are not up to the challenges of the intensive harvest levels we are experiencing today.
The overall picture: No forest practices act, no preharvest notification, no mandatory certification or training of lawyers, no statewide mandatory best management practices.
The solution in my view is that we use the significant Federal dollars that will be handed out in the farm bill to create incentives for State forestry programs to meet some prescribed level of Federal effectiveness with regard to environmental safeguards as a condition of receiving significant Federal dollars.
A third concern I have is the continued loss of forested wetlands in our region due to silviculture practices. I am particularly focused here on freshwater, forested wetlands. The bottomland hardwood swamp would be a good example. These have very significantly declined and current losses, according to the Status and Trends Report just released by the Fish and Wildlife Service, attribute or place silviculture on a par with agriculture in terms of the cause of the loss of freshwater, forested wetlands.
In my view, the swamp buster provision which has been so successful in limiting the loss of and conversion of wetlands due to agricultural practices should be extended to silvicultural practices.
Finally, like others, I very much support increased assistance for the private non-industrial landowners. My two caveats there would briefly be that we equitably look at the variety of management objectives of these landowners which include, often, wildlife habitat and other objectives along with timber. So let's make sure the support is equitable across the variety of landowner objectives. And let's also ensure that we are only subsidizing practices which really have significant public benefits.
Page 33 PREV PAGE TOP OF DOC One example I would like to see an end to is any Federal subsidy for the conversion of natural forest stands to monoculture pine. I think in view of the trends in the region, this is not something we need to be providing Federal subsidies to.
I appreciate the opportunity to appear before you today and look forward to answering any questions you may have.
[The prepared statement of Ms. Hayes appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you very much.
Thank you all for your excellent testimony. We have a number of questions that we would like to ask. Let me begin by giving you a little bit of my perspective on this issue. I don't want to take a lot of time here addressing our policies in our national forests, because I want to keep the focus on private landowners and private forestry, but the two are very integrally related.
Ms. Hayes, you mentioned the dramatic increase in production in forests in the Southeast. I am sure that is true, but I would attribute the primary reason for that to the fact that we have virtually shut down our national forests in terms of harvesting timber. For example, there would be a natural shift from the West, where the overwhelming majority of the land is Federal land, to the Southeast where a majority of the land is privately owned because of that very factor. But my district in the mountains and valleys of western Virginia in the east is a good microcosm of that. My district contains about two-thirds forested land; of that, about half is owned by the Federal Government, about a million acres; about half is owned by private landowners, about a million acres. Of the timber harvested for building homes, for making furniture, for making paper and all the other forest product uses, 95 percent of the production comes off of the private land and 5 percent off of the Federal land, even though they are about equally divided in terms of the amount of acreage of forested land.
Page 34 PREV PAGE TOP OF DOC That concerns me greatly because I think you are right, it is putting increased pressure on private land. So I guess my first question to you would be, is it the purpose of your organization to see an overall reduction in productivity from all of our forests, be they national or private, in spite of the fact that demand for wood products is continuing to rise in the country and in spite of the fact that there is tremendous pressure on forest reserves elsewhere in the world where they don't do nearly as good a job as we do in protecting our forestry resources, and continuing to cut back on what we produce here is going to increase that pressure elsewhere in the world?
Ms. HAYES. No, we don't have the goal to reduce overall forest production. That is not a goal of ours and we have never advocated that, and we do not support efforts to end commercial logging on private lands.
Mr. GOODLATTE. How about on Federal land?
Ms. HAYES. I meant to say on Federal lands. Never had that position. Our focus has been exclusively on trying to maintain the health of our public lands in terms of the ecological resource that we see there, but we have never in any proceeding advocated an end to commercial logging on public lands.
Mr. GOODLATTE. Let me give Mr. Fledderman and Mr. Leavell and others an opportunity to respond. Is this a good thing or a bad thing? From the standpoint of prices for your products on private land, I would imagine that the lack of production on Federal land, limiting the supply, increases the price somewhat, although it also creates an opportunity for those who would import products in the United States because the competitive price outside Canada and other places becomes far more attractive. Or is it a bad thing because it is putting too much pressure on the private land and we should have more production on the Federal land?
Mr. FLEDDERMAN. Well, I certainly think that we need to do everything we can to make sure that the private landowners are getting a reasonable price for their timber, and to that extent, it may be a good thing. Perhaps more importantly, though, I think the real crisis on the Federal land is that those lands aren't being managed actively at all; and we are really seeing a decline in their health, and I am very much afraid that we are going to lose them altogether to wildfires and insects and other catastrophes.
Page 35 PREV PAGE TOP OF DOC So I think it is just good stewardship that needs to go on in our Federal forests.
Mr. GOODLATTE. In other words, over history, as we have fought forest fires and disease infestation and so on, the buildup of timber in those areas has gotten to the point where about half of all of our Federal forestlands are now subject to catastrophic wildfires that do not just burn on the ground, but destroy the entire forest, like we saw in Idaho and New Mexico and other places last year.
Mr. FLEDDERMAN. They burn up the forests, and they also burn up the forests of the landowners next to them.
Mr. GOODLATTE. That is a good point.
Mr. Leavell, do you have any thoughts on this issue? You are a southeastern private landowner.
Mr. LEVIN. Well, certainly I have an interest, Mr. Chairman, in the price of our goods and the health of the forests, but I would also say that Gifford Pinchot, who started forest management back in the early part of the century, I think had the notion, correctly, that these Federal lands should be managed in part as a resource for America. Now certainly, that having been said, I believe that there are parts of America that need to be protected and set aside andhalf for recreation, half for old growth forests to be there for all of us to enjoy. But I also believe, like Mr. Fledderman has said, that the health of the national forests are in jeopardy, and I would like to see stronger management practices on those Federal lands.
Mr. GOODLATTE. You favor a more balanced use of our national forests than we are getting today, and I agree with you.
Mr. LEVIN. Yes.
Mr. GOODLATTE. Let me ask a follow-up question, and then we will turn it over to Mrs. Clayton.
Page 36 PREV PAGE TOP OF DOC Ms. Hayes testified that there is considerably more production than growth in the south. I am not sure if that is correct or not; you may want to comment on that. But I have a Forest Service table showing the top 10 States in planting and seeding for 1999, and Georgia, Mississippi, Alabama, Florida, Texas, Louisiana, South Carolina and Virginia all appear on that list. If southern States are leading the effort in planting and seeding, is there truly a reason for alarm here?
Mr. FLEDDERMAN. Well, I do not think there is a reason for alarm. Actually, it seems to me a little scarcity would be a good thing to drive the prices a little bit for the private landowners, but that is really not what is happening here.
One thing that is in those statistics is the fact that they are going for information that in a lot of cases is 5 to 10 years old, so the plantations that have been established since the early 1980's and into the 1990's still are not merchantable; so their volume is not counted, which shows up in those growth-over-terrain statistics.
The RPA assessment from the Forest Service shows that those statistics will turn around in the next 10 years, and we will again have an increase of growth over terrain. So we do not view that as being a significant problem right now.
Mr. GOODLATTE. Thank you.
Mrs. CLAYTON. Thank you. Thank you all for your testimony.
Assuming there is general agreement about whether the south has absolute or ''the'' growth, but certainly the trend is moving that way, we do recognize that most of the timber is in the hands of the private landowners, and yet, the supposed management system, flawed as it may be, is with the Federal lands. There is not a balanced effort with private landowners to provide the kind of either incentives or management strategies or access to information, and I heard a professor from our land grant college indicate that indeed he wanted to increase that research, outreach. And I gather from the State, you wanted to do that, Dr. Reid, I guess through your land grant universities.
Page 37 PREV PAGE TOP OF DOC Each of you, would you just speak to the value of assessing the value of having available forest management assistance, standards, strategies and certifications of individuals working on private land as we are doing with public land; and as private owners, how would you access that and what value does it have?
The second question would be, as private landowners, you have mixed reasons why you own the land, I assume. Those who are tree farmers obviously want to have an adequate return on them, and have a right to, whether you do it for the building of houses or paper or whatever the industrial use; but some of you have value for other reasons, and that is aesthetic, that is, value of the right to own land where trees grow. And you also know the value that your tree farms have to clean air and clean water.
Could we assess a value to that for you as a private landowners? Anyone can respond, but let's start with the professor.
Let's talk about the value of the training to private landowners, Dr. Reid.
Mr. REID. Certainly. I would be glad to try to respond.
I certainly can't speak on behalf of the landowners themselves, but I think we see that if, in fact, we are going to provide a service to the private landowner, that this has to be, as I say, knowledge-based, that we have to have some information to transfer to the landowner.
There are a number of concerns from the educational community. One is that we realize that a number of our Federal agencies, State agencies, are going to have some major retirements of their work force, and we are concerned about providing the education and supplying those professionals that can work in the forest arena, whether that is extension agents or people that work for the State forestry agencies or the Forest Service, whoever. Certainly, we see a concern there.
Page 38 PREV PAGE TOP OF DOC Second, we think we could better utilize our cooperative extension system that most of our institutions at the land grant institutions have, but working more closely with the State agencies and the Forest Service in particular, perhaps in RCS and others, that we need to get the information out; and I think we have to continue to address new kinds of strategies to manage smaller and smaller land parcels that appear to be the trend with a lot of these forest landowners. And whether that relates to water quality or wildlife habitat or new ways to harvest timber in an efficient way on small tracts, we think there is a need and a concern about providing that kind of research information as well as the educational outreach.
I would hope that our landowners would agree that, hopefully, they are getting good information in a timely manner, and I think it is our responsibility as land grant institutions to help provide that.
Mrs. CLAYTON. Yes.
Mr. SMITH. I would just like to carry on a little bit from what Dr. Reid talked about.
This is a very complex issue, but I think it gets down to the fact that a guiding principle that I think virtually everybody here in this room would agree with, without question, is what is in force needs to stay in force. That is critical, and that relates to a lot of our population issues and so on, and some of the legacy program and how we do that.
I also speak representing professional foresters who are, in fact, the ones that are going to do this work on the ground and see that it is done. I also represent the nonindustrial private land owner. I have land which I own and which I manage. Even as a professional forester, in the area where my land is, I do not feel totally comfortable managing it when it comes down to plans and so on, because I am not in that area all the time, and I do not have the knowledge that people on the ground, the consultants, the State foresters and so on, do.
Page 39 PREV PAGE TOP OF DOC The landowners that I talk to, they are across the board interested in doing the right thing. They have, almost across the board, many different values and uses for their forests, which include aesthetics, wildlife, clean water, and timber; and in most cases, all of these values and uses are pretty compatible. I think it should be our goal so that a nonindustrial private landowner has the information and has the technical ability to make informed decisions.
There is a recent study, just completed in West Virginia, for example, and reported here just a month ago, on this very topic of landowners, nonindustrial private landowners who took advantage of the stewardship bill authorized by the 1990 farm bill. Some, close to 2,000 were surveyed, and they weren't surveyed unless they had had stewardship plans in place for at least 5 years. So these are working plans, and these are written by professional foresters, some 60 percent by consultant foresters, 30-some percent by State foresters, and a few others. But the results, the authors wanted to measure the effect of this on the management.
Well, there are several things that happened. First of all, compliance with best management practices were greatly enhanced by having the knowledge and having a professional forester and having a management plan in place. By offering the landowners other uses for their land, control of noxious weeds, control of erosion into streams, the stream side zones, the ability to prepare certain sites for certain types of wildlife. Once those other objectives were placed in the plan, the landowner's ability to utilize those was far greater and was actually quantified.
One complaint, I think there was some 80 percent satisfaction with these plans, and very few people didn't like it; and a couple of things they didn't like, they wanted some follow-up work by the professional foresterafter this is over, well, this is what we need to doand they also found that those activities that weren't directly related to the timber and the sale of the timber, those were less likely to be carried out because there wasn't an incentive.
Page 40 PREV PAGE TOP OF DOC Basically, I think most professional foresters think that providing the information and providing some type of incentive, not a gift, but some type of incentive to do those things that will help them achieve their goals, there is tremendous value in that.
Mr. GOODLATTE. We will do another round of questions.
Dr. Smith, the Society of American Foresters is recommending that we combine the Forestry Incentives Program, FIP, and the Stewardship Incentives Program, SIP, to create a new, sustainable Forestry Incentives Program. As it stands now, FIP is funded through the Department of Interior appropriations and administered by the Natural Resources Conservation Service, and SIP is funded through the Department of Agriculture and administered through the Forest Service. Neither program has been funded at a high level. In fact, the SIP program was authorized at $100 million annually and not funded at all during fiscal 1999, 2000, and 2001.
Which agency does the Society recommend we administer the new program through, and do you anticipate any problems in trying to authorize and fund a new program at approximately $143 million more than the two existing programs have ever been funded at?
Mr. SMITH. To say what agency should do this probably is a decision that would be better madewhatever it is, it needs to be together. These need to be coordinated programs. The partnerships need to be established and how they will be operated. Above all, they have to be coordinated so that out on the ground, they will happen.
I think this is so critical. When we have fragmented programs, we have fragmented results. It seems natural, I think, that the farm bill is a logical place for these to occur, especially when it comes to the nonindustrial private lands; and for that reason, to have a coordinated effort under that bill makes a lot of sense, and certainly from an administration standpoint makes more sense. The partnerships that I think we have seen across this table and the alliance, the national alliance that worked together on this, the players are there and the ability and the science are there, and I think now we need to get a program that will, in fact, work on the ground and can be accountable for what they do.
Page 41 PREV PAGE TOP OF DOC Mr. GOODLATTE. So your answer, I take it, is that you like involvement by the Department of Agriculture.
Should they take the lead on this?
Mr. SMITH. In my opinion, yes, sir.
Mr. GOODLATTE. All right. Good. And your thoughts on the funding are, you recognize we have not been successful in getting a lot of funding for this in the past, but authorize a lot and hope for the best? Is that your thinking?
Mr. SMITH. I think that no funding definitely does not work, and certainlya level of funding such as has been suggested certainly will be a large step in the right direction.
Mr. GOODLATTE. Well, thank you.
Mr. Leavell, your organization can actually be helpful in this regard, because organizations of private landowners that have many thousands of members have many thousands of contacts with Members of Congress. That is, I think, the most likely way we are going to get significant funding for these programs.
Can you tell me if your organization and others like it have any plans to, on a grass-roots level, get this message across to the community at large, and, more specifically, Members of Congress who are not on this subcommittee, about the need here?
Mr. LEAVELL. Well, Mr. Chairman, absolutely. We are constantly working in outreach to our fellow landowners through the tree farm program and through other programs that exist.
And if I may just go back to some of the issues we were discussing a few minutes ago about the programs that are in place and the increase of awareness of the landowners, it is so important that the landowners be aware of what is out there; and I think to some degree, that is a problem. I know that in my experience, I have used both. I have used FIP programs, ACP programs, the WIP program which, by the way, I think is a very good program, because it does include the wildlife aspect of it.
Page 42 PREV PAGE TOP OF DOC As a landowner, as Mrs. Clayton pointed out earlier, there are certainly diverse reasons for owning the land and for using the land and what you want to do with it. I think most all of us that are in this boat would say that we want a balanced approach. We want a balance of sound forestry, we want to see the wildlife out there, and we want it all to work.
This assistance is needed. I have fellow landowners come up to me at meetings and ask about these programs that they are either unaware that they exist or are not sure how to go forward.
I might disagree a little bit with Dr. Smith in saying about the administration of these programs. I must say that we are talking about forestry, and I would like to see more entities directly involved with forestry, the U.S. Forest Service, for instance, the State forest commissions be more involved in administering these programs.
Mr. GOODLATTE. Very good.
How important are easement programs and land trusts for forest sustainability? I will direct this to you as well, Mr. Leavell, and if anybody else wants to join in.
It seems to me if we have such programs where we have a barrier to sprawl and other uses of the forest, but continue to recognizenot to shut down the forest for the purpose that I think they exist, which is to provide for a variety of uses, including harvesting timber.
How important are those programs, and what emphasis should we put on them in our farm bill, Mr. Leavell.
Mr. LEAVELL. I am sorry, which programs, sir?
Mr. GOODLATTE. Easements and land trusts.
Mr. LEAVELL. Well, they are certainly part of the answer, Mr. Chairman; and we applaud some of these programs. But you know, quite honestly, there are some of us that may not want to tie up our land for generations yet to come, two or three generations up the road. So while I think certainly these programs have a place and they are important, they are not the only answer to conservation.
Page 43 PREV PAGE TOP OF DOC Mr. GOODLATTE. Sure.
Does anybody else want to comment on that?
Mr. FLEDDERMAN. Yes. I think certainly easements have a place here. I get somewhat concerned about a lot of the easements that are being written these days that tend to lock up the land rather than allow active management on them; and to that end, they may be counterproductive. Perhaps a better approach might be things like the Wetlands Reserve Program, where they have a 30-year agreement to manage lands for some conservation purpose, and you get away from the perpetual idea of giving up the rights to the land and go for 30 years at a time. I think that would be a lot more palatable to landowners.
Mr. GOODLATTE. Should we, to the extent the Federal Government offers any kind of tax credits and so on for conservation easements, attempt to more tightly define them, so that they are not used for the purpose of shutting off all activity on the land, which I think is not only economically irresponsible, but also environmentally irresponsible?
Mr. FLEDDERMAN. I think that should be a consideration, certainly.
Mr. GOODLATTE. Dr. Reid, you also testified to a number of different programs and recommended increased funding for them, many of which are not currently funded at their present authorized level, and I wonder if you could prioritize those. What are the top one or two in your mind that we should put our emphasis on, given the fact that they do not always get the money funded for the programs that we authorize?
Mr. REID. Well, certainly we would strongly support the McIntire-Stennis Cooperative Forestry Program. It leverages a lot of dollars from the State and other sources in addition to those Federal dollars. It really provides an infrastructure for our institutions in terms of the kinds of talent we can have on our faculties, that those monies are very important, and we think there need to be some increases to allow us to address some of these new issues, complex issues, that nonindustrial private landowners are facing.
Page 44 PREV PAGE TOP OF DOC So, certainly, trying to get the McIntire-Stennis up to its authorized level of half of the Forest Service research budget, somewhere around $105 million, is very important to us.
I think the reauthorization of the RREA is another major priority for us. I think this goes to that outreach component that is so needed to reach these 10 million landowners, many of whom we just do not have the contact with. As you realize, most of our member institutions are part of cooperative extension, which means we have a presence in every county in our States.
Unfortunately, of the 16,000-some-odd cooperative extension agents in this country, less than 3 percent are forestry source extension people. So we really would like to see us increase that capacity to work with the State forestry agencies and commissions, to work with State and private forestry, the Forest Service, and work with the private stakeholders and the NGOs. These are professional educators that we have out in these counties, and so the RREA program is an extremely important infrastructure type of program that I think could go a long way to our outreach.
Certainly there are other areas in the Competitive Grants Program, of course, where we think there needs to be more money directed to forestry and natural resources in addition to that money that goes to more of the commodity-related agriculture. But I would say those would be our major three priorities. Certainly we support those kinds of mechanisms that help lead to better collaborative efforts among all of the stakeholders.
Mr. GOODLATTE. Thank you, Dr. Reid.
Mrs. CLAYTON. Just following up on a comment you made, Mr. Reid.
I know in my county I work effectively with the Extension Service. And then when there is a little project, I have been engaged with my community 4-Hs, and they have a forest component; no one at the Extension Service is helping them, but the forest ranger is trying to.
Page 45 PREV PAGE TOP OF DOC Then, when I try to understand the forestry in my area, I understand that the logger, who indeed is probably the most minimum person who is engaged in this, is not engaged in terms of that information. It was the ranger coming to the extension agent who proposed to me that I try to establish a curriculum at the community college system to begin to have the knowledge base that they are part of a system, both economic and ecological systems, that they can appreciate if they had the education.
Now, I do not know if your program anticipates moving to that level, but I can tell you again, landowners need assistance. In some counties where I live and serve in the district, these are people who own 20, 30 acres of land and they live somewhere else sometimes, and they want to see the land produce. So, without thinking, the first person that comes with a contract, they cut the land down.
It sounds like normal business to me, but when you have a conversation with them, they say, well, if someone had engaged me in that, I might have thought differently about that process.
My husband is an attorney and majors in land, and they regret sometimes having made that decision when they want to sell; and parts of the land, there are no trees on them.
So there is a vast need for education at the level to include not just a farmer, but other people who are using that land. And sometimes there are landowners who want to get a value from their land to pay the taxes, and if they reserve a decision, they could have had more money, because later on, when they want to develop that land around the lake, it has more value if it indeed has trees.
That is more of a statement.
Mr. REID. I like the statement. Thank you.
Mrs. CLAYTON. It provoked that statement.
Page 46 PREV PAGE TOP OF DOC I want to ask Ms. Hayes, if I may, in your testimony, you made some recommendations about the modernization of State forestry practices. You recommend water quality funding only to the States that meet the Federal prescribed level of effectiveness.
Can you provide the subcommittee with a rough outline of what such a level of effectiveness would be? I know you cited one State, I think it was Kentucky that has a statewide strategy. Is that the kind of example, or do you have other ideas about a strategy?
Ms. HAYES. Well, I haven't prepared any particular definition of what we might expect in terms of awarding these funds. But some of the things that I note at the top of my testimony on page 6 about what we do not haveagain, I am talking as an overall picture in the Southeaststatewide mandatory best management practices for forestry would be one of the elements, it seems to me, that we ought to look to to help guide the loggers that you were just referring to.
Another thing that might be an element of some kind of Federal guideline would be, again, the training or certification of loggers, the program that you are exploring, possibly at the community college level. Forward-looking States like Kentucky have initiated short courses that they require of loggers, the folks who are actually going to be out there on the ground engaging in these practices.
It seems to me that there need not be any rigid Federal definition, but if we are extending significant Federal funds, it seems that there ought to be some sort of accountability that looks at the effectiveness of the State programs and best management practices, availability of logger training; these are all of the things that might be part of a Federal standard, and I think could wind up helping the landowners very substantially in avoiding any adverse environmental consequences as well.
But again, right now, the picture in the South is that we do not as a general matter have these provisions. There are some exceptions.
Page 47 PREV PAGE TOP OF DOC Mr. Goodlatte, I noted that Virginia has seen fit to require preharvest notification, so that technical assistance can be provided in advance of these logging operations and so that water quality laws can be enforced. These forward-looking States like Kentucky and Virginia, to me, need to be rewarded for their positive steps; and others need to be given some sort of performance guidelines, nothing that I have yet defined, but that include some of these factors.
Are we prepared for the increased logging levels that are occurring on private lands? It seems to me we have an opportunity to create some incentives here for the States to relook at some of these issues.
Mrs. CLAYTON. One final question to you. Would you suggest, or are there programs we are now subsidizing farmers with that are encouraging practices that are not ecologically sound? Are there some conflicts in objectives of programs, that we may be subsidizing programs that really may be achieving the very thing we say ecologically we should not be achieving?
Ms. HAYES. Well, I agree with the other speakers that the primary problem is that we are just not getting technical assistance and other forms of cost-share programs out there to assist the private landowner. That is the number one problem, and it is due to the lack of funding, and these people desperately need help.
Since so many people do support enhancing these landowner assistance programs, I was trying to make a suggestion, looking forward, that we, as we increase the dollars going into landowner assistance, we ought to be specific that we want them to equitably support all of the different landowner objectives, including wildlife management and uses, including timber, but not limited to timber.
So the first thing is, let's make sure that we give the full range of technical assistance that these people need.
Page 48 PREV PAGE TOP OF DOC I do think that the one issue that I would raise is that we have already converted large amounts of our region to pine plantation, and this has often been at the expense of naturally occurring forest types, some of which have been significantly reduced, like the long leaf pine forest that once covered most of the coastal plain, like bottomland hardwood.
Pine is already projected, for example, in North Carolina to increase by another 1 million acres by 2020. So I would like these new technical assistance programs to focus more on offering landowners assistance in maintaining or restoring naturally occurring forest types, and I do not believe that we should be subsidizing the conversion of existing natural lands to pine with Federal dollars.
So that would be a caveat about increasing technical assistance.
One of the big reasons, of course, is that some of these conversions of the naturally occurring forest types involve the conversion of wetlands to pine plantations, and I think that is something that we have to be concerned about as we have continuing wetland laws; and we want to make sure that that is not further encouraged.
Mrs. CLAYTON. My final comment is about the land trust, and I am not sureMr. Leavell, I thought I heard you say that land trusts and easement would be part of the solution, not the solution. Did I correctly interpret that?
Mr. LEAVELL. Yes. Yes, indeed.
Mrs. CLAYTON. The reason I make that observation, I do not know what would be an appropriate way to have the land trust, but in North Carolina, we lost more forests than anyone else, I guess, in the last few years that are measured. The report came out I guess about 4 months ago.
And so much of the concern now in sustainable growth in communities, both urban and rural, is about how do we maintain that balance. And one of the solutions, one of the offerings of solutions, was to begin to look at land trusts or giving tax incentives, giving landowners their development rights and defer it, meaning that they wouldn't lose their right if they wanted to later on.
Page 49 PREV PAGE TOP OF DOC Do you have other suggestions as to how we encourage your farmers to keep their land? They may not be making as much money on the land selling the wood, and they are tempted, or with the competing economic issue, do I sell it to the developer orbecause I can get more money? But if there is a tax incentive that gives them the developmental rights there, they can benefit through perhaps a tax structure.
Do you have other ideas or comments on that?
Mr. LEAVELL. Well, just to say that, again, we do support the Forest Legacy Program and we do urge that it be fully funded. We think these are wonderful incentives. But again, the problem of tying up land for generations is something that is a hard pill sometimes for a landowner to swallow.
I would certainly applaud Mr. Fledderman's suggestion that some of these programs have year limits, like 30 years, and allow future generations to make decisions on their own as to what they prefer to do with the land.
But I do think that those types of tax incentives that are given in those programs are certainly significant; they certainly can make a difference for a landowner to be able to hold on to their land. I think they are very important.
If I may also say, since it appears that we might be coming to a conclusion here, these are programs that we, I think, so desperately need to continue and to expand for the private landowners. The American tree farm system consisting of 65,000 landowners is a very powerful organization, and as I mentioned in my earlier testimony, I think there is a lot to be said for that peer-to-peer type of communication and type of connection.
While we are already, and have been for many, many years now, doing that type of outreach, we stand poised, with the possibility of some new programs that we think are better designed, to stand behind them and put the full force of tree farming in action.
Mr. GOODLATTE. Thank you, Mrs. Clayton. That has prompted a couple of more questions.
Page 50 PREV PAGE TOP OF DOC I wonder if any members of the panel have any comment of Ms. Hayes' expression of concern about the proliferation of pine plantations. Is that a good or a bad thing?
Mr. SMITH. There is a context here that needs to be, I think, brought out. For the most part, everything in, all the pine plantations historically were in agricultural land, or a large percentage of them at one point, and have reverted back to pine of different types naturally and, in some cases, plantations.
But virtually throughout the South, it was all agricultural land at one time, except probably prior toNative Americans, of course, burned these lands, and that is how the long leaf pine became well established prior to European settlement. So to say that we are going to have natural forests, I am not sure that is a reality. We can have succession natural forests that will come on after agricultural land, and if you don't replant the pine, a lot of it will go to hardwood. So there are some ecological ideas that we need to look at carefully here.
I think for a long time, from a scientific standpoint, the ability to have long leaf pine plantations because of the difficulty of planting it and getting it to survive, which a lot has been overcome through good research and science. We have made some progress, and I believe that actually the long leaf pine ecosystems are, in fact, growing at this point; and at least we have the capability to do that on some of these lands.
Mr. GOODLATTE. Thank you.
Mr. Larson, you get the last question.
In your testimony, you recommended we consider authorizing a new program entitled the Sustainable Forestry Outreach Initiative. You also recommended Congress reauthorize and expand the existing Renewable Resources Extension Act, two programs that appear to be quite similar. I wonder if you could tell us what the similarities and differences are between the two programs and why we need two rather than simply enhance the one?
Page 51 PREV PAGE TOP OF DOC Mr. LARSON. No, I cannot. I do not know enough detail about that to describe those differences, but the principal point we want to make is that any of the information and education programs is what we strongly endorse. We would second almost all of the things that Mr. Reid has suggested about the value of information and education and the package that it comes in, that is, up to the hashing out through this farm bill.
Mr. GOODLATTE. OK.
Mr. LARSON. I would like to make one follow-up comment, if I could.
Previously, in your very beginning questions, you talked about the transfer of cutting pressure to the South from the West and asked whether that was a good thing or not. Yes, landowners saw that as a very good thing. Price provides the best incentive to practice good forestry.
What we saw, what consultants saw when prices went up was landowners then had additional funds that they were willing to reinvest in the property, not just in planting trees, but in all sorts of environmental improvements. So the prices rise and the transfernow, it will be balanced out, if demand gets too high and they will respond and grow more trees. When the price goes down, they stop reinvesting.
Mr. GOODLATTE. Well, I certainly want landowners to get a premium price for their trees, and lack of supply is certainly one way to accomplish that. But I see two competing problems. One is that when the price gets high, the next place we go toand it is happening right nowis an increase, a substantial increase in imports from other countries, which in some respects certainly is part of free and fair trade and competition, but by the same token, if it is subsidizing another country, and they are not following sound environmental practiceswhich is an issue for another day's debatethat is not a good policy.
Page 52 PREV PAGE TOP OF DOC Second, I think it is not a good policy to shut off the vast majority of the areas of our national lands from an environmental standpoint, albeit increased production, and I do not say we are going to see dramatic increased production there any time soon, but that would have some effect on the price of timber coming off of private lands.
So it is a balance we need to achieve not only in the management of the land itself, but also in the management of the policy, which treats the private landowners very fairly and gives them every incentive to properly manage their land from both an economic and an environmental standpoint.
But we need to take the same approach with our Federal land, and I fear we are not.
I thank you all.
Mrs. Clayton, any other questions?
Mrs. CLAYTON. No.
Mr. GOODLATTE. I thank you all. It has been an excellent panel, great contributions, a great foundation for our work on this farm bill. Again, I thank you for your participation. I have some magic language I need to read here at the end.
The Chair would seek unanimous consent to allow the record of today's hearing to remain open for 10 days to receive additional material and supplementary written responses from witnesses to any question posed by a member of the panel. Without objection, it is so ordered.
This hearing of the Subcommittee on Department Operations, Oversight, Nutrition and Forestry is adjourned.
[Whereupon, at 11:45 a.m., the subcommittee was adjourned, subject tothe call of the Chiar.]
[Material submitted for inclusion in the record follows:]
Page 53 PREV PAGE TOP OF DOCStatement of David Smith
Mr. Chairman, my name is David Smith, and I thank you for the opportunity to share our views with you today. I come before you to discuss an underutilized potential resource to achieve sustainability in this nation; namely non-industrial private forest landowners. The Society of American foresters believes that non-industrial private forest (NIPF) landowners are absolutely essential to the sustainability of our Nation's forests, and that there are significant opportunities to help them realize their potential.
NIPF landowners own approximately 363 million of the Nation's 747 million acres of forestland, accounting for almost half of the Nation's forests. That is larger than two times the size of the state of Texas. These forests provide important public benefits like wildlife habitat, clean water, recreational opportunities, open space, and other environmental benefits. They also provide important forest products. In fact, NIPF lands provided almost 60 percent of the Nation's timber harvest in 1996, and as timber harvest on the national forests continues to decline, the number of private landowners harvesting timber continues to grow. However, the most optimistic studies show that only ten percent of NIPF landowners consult a professional forest prior to harvest, the most pessimistic put the figure at 5 percent. Landowners are making important business transactions that affect their bottom line, and the Public's environmental bottom line without using professional advice.
Despite their importance, these lands are the least intensively managed of any forest ownership category in the nation. On much of this land a timber sale is an unusual event in the owner's life; often in response to a personal situation such as retirement or other financial needs. If a landowner has a sound management plan, unusual events can usually be provided for within the context of that plan. Management plans enhance the investment in forestland, and can help the landowner achieve the full potential of that forest resource when they need it. Forest management is a long-term commitment that takes careful planning. As we have demonstrated, the vast majority of timber sales are without benefit of professional advice; with no plan for maintaining or regenerating a sustainable forest following harvest; and with little recognition of the environmental impacts of these activities. NIPF landowners need technical advice, and they are not even aware of this need.
Page 54 PREV PAGE TOP OF DOC The good news is that professional foresters have done an excellent job reaching large landowners. Almost 40 percent of the NIPF acres in this country have a forest management plan written by a professional forester. In many cases private landowners with large holdings seek professional advice. These ownerships have much more at stake both financially and environmentally and are much easier for foresters to identify. This is not to say that foresters do not want to seek out landowners with smaller acreage. There are 9.9 million NIPF landowners in the United States, and that number continues to grow. There are 17,500 members of the Society of American Foresters. Clearly we are out numbered and agencies are severely under-funded.
Providing landowners with education, technical assistance and financial incentives works. For example a recent study in the state of West Virginia shows that Forest Stewardship Plans (authorized under the farm bill) are effective in influencing landowners. Landowners implement activities, such as timber harvesting, stand improvement, grapevine removal, and wildlife habitat improvement, more often when prescribed in stewardship plans. Research also shows a strong positive association between forester involvement in timber sales and compliance with West Virginia's Best Management Practices. However, landowners expressed dissatisfaction with the Forest Stewardship Program, because they want more frequent visits from foresters; and more funding for implementing noncommercial forest stewardship activities. Studies indicate that landowners with Forest Stewardship Plans are three times more likely to implement those plans if they receive financial incentives or additional technical assistance. Landowners receiving this assistance are also more likely to manage their forests for timber, wildlife and water quality, and are more likely to adopt multiple resource management practices, and to try practices that are new to them. If landowners know what is possible with their forests, and can find the funds to implement a forester's advice, they want to do the right thing for the land. We just need to make those opportunities available.
In 1996, timber products were the 2nd highest valued agriculture crop in the U.S. at $22.5 billion. Only corn was bigger at $25.1 billion. Yet forestry programs receive less than one-half of one percent of all commodity support from the Federal Government. Private sector and state efforts have picked up some of the shortfall in resources, but unmet need is large. We are not saying that forestry is more important than other agriculture commodities, all are critical to the future of this nation, but we hope the Federal Government will increase the resources available to NIPF landowners through the next farm bill.
Page 55 PREV PAGE TOP OF DOC Since authorization of the forestry provisions of the farm bill in 1990, there have been significant changes in public and private attitudes on forest management including the promotion of ''sustainable'' forestry, forest certification and the dramatic shift in domestic supplies and international competition. State forestry agencies and commissions are being asked or mandated to take on greater environmental responsibilities and demonstrate progress in forest resource management, and financial incentives to convert forests to subdivisions and other developments are ever increasing.
Pressure to convert forests to development is ever increasing, and if we are to achieve sustainable forests, we must ensure that forests remain forested. The Federal Government can use effective, nonregulatory tools for maintaining a working forest land base, preserving environmental values, and protecting a community from development pressure. There are private sector initiatives addressing some of these issues, but the private sector cannot do this job alone. There are Federal taxes the government should modify to achieve some of these objectives, but changes in the tax code cannot do this job alone. The Federal Government must provide financial assistance to landowners to solve at least part of this problem, as the Federal Government has significant goals and regulatory programs affecting forest landowners such as the Clean Water Act, the Endangered Species Act, and other important environmental laws. These public sector efforts should dovetail with private and state efforts as well. Additionally, forest issues are not only national but global, and the Federal Government must act to ensure that non-industrial private forest landowners have access to global markets and have the type of forest resources that have value in those markets.
The SAF is proposing two major initiatives and changes to existing Federal conservation programs in order to improve the sustainability of the Nation's forests. We generated these ideas in strong partnership with the National Council on Private Forests, a collection of organizations interested in private forest resources.
Page 56 PREV PAGE TOP OF DOC The Sustainable Forestry Incentives Program
The Forestry Incentives Program (FIP) (Section 1214) and the Stewardship Incentives Program (SIP) (Section 1216)FIP and SIP were well intentioned and designed programs. They have suffered from a lack of funding and support. We recommend a new program to enhance the ideas and concepts the authors intended for FIP and SIP, and focus this program on ensuring sustainable forestry. The Sustainable Forestry Incentives Program would provide Federal funding to implement conservation practices that benefit the public. The program must be complementary to efforts to provide educational outreach on sustainable forestry, and offer technical assistance to landowners. The program would fund a broad array of conservation practices that landowners typically do not implement due to a lack of financial resources. These practices may include, but shall not be limited to; sustainable timber production; agroforestry practices such as shelterbelts and windbreaks; forest wetland and riparian area management; water quality and watershed protection and management; energy conservation and carbon sequestration; wildlife habitat enhancement; invasive species management; forest fire risk reduction and recovery; and forest management planning. State stewardship committees in collaboration with the state forestry agencies will determine practices eligible for Federal funding, and the state forestry agencies will implement the program. The key differences from past forestry cost share programs and this new program will be a commitment to sustainability, and an integrated delivery mechanism combining financial assistance, technical assistance and educational outreach to implement these conservation practices. The program should be funded through mandatory funding at a level of $150 million.
Sustainable Forestry Outreach Initiative
Research studies show that only ten percent of landowners receive professional forestry advice prior to harvest. Most landowners have a range of objectives, with timber production usually subordinate to other considerations such as recreation and aesthetics. Many landowners do not have management plans in place, and when they decide to harvest they often receive less value for their timber than if they had advice from a professional forester. Frequent results from unplanned harvests include land that could have been left in better condition, values other than timber may be significantly diminished, and reduced environmental compliance. Many of these problems are avoided when landowners receive professional forestry advice.
Page 57 PREV PAGE TOP OF DOC SAF proposes a new program entitled the Sustainable Forestry Outreach Initiative to conduct a targeted campaign to educate forest landowners about:
the value and benefits of practicing sustainable forestry;
the importance of professional forestry advice in achieving their sustainable forestry objectives;
the variety of public and private sector resources available to assist them in planning for and practicing sustainable forestry.
The outreach effort would be funded through USDA CREES (Extension) and implemented with the assistance of the SAF, members of the SAF, the State Foresters, and University partners. A major thrust of the Initiative would be the reauthorization and expansion of the Renewable Resources Extension Act (RREA). RREA addresses critical forestry and related natural resources extension and stewardship needs in states, and also the critical issues of forest management for productivity and environmental quality on non-Federal lands. The SAF supports this program, which helps in communicating ecologically sound technical advice to landowners, foresters, and loggers. This advice improves the productivity, management and long-term sustainability of nonindustrial private forests. The program funds extension efforts that are a model of partnership between the USDA and State Universities and Land Grant Colleges. We know there are substantial unmet needs of non-industrial private forest landowners, and RREA is one piece of the solution. We ask Congress to reauthorize and expand the program.
A second major emphasis will be to enable non-governmental organizations to delivery forestry advice and expertise.
The goal would be to reach a substantial number of the 4.1 million individuals and families who own forested tracts larger than 10 acres. There will be specific emphasis on peer to peer learning and outreach. Additionally, the effort would promote the value of professional forestry advice, and the favorable economic and environmental results associated with that advice.
Page 58 PREV PAGE TOP OF DOC We believe the program's value would lie in its targeted approach to outreach, and delivery mechanism of extension foresters, university partners and professional foresters. A national publication would provide information from a broad array of public and private sector programs available for landowners interested in sustainable forestry. The effort will allow landowners to explore opportunities to improve the condition of their land and improve the value of their property and the proceeds of their management, provide public benefits via improved forest lands, all at minimal cost to the government because we are largely using private sector dollars and programs to get the work done.
SAF supports a program authorization of $45 million per year to support the Initiative.
SAF recommends that the Secretary appoint an advisory body comprising Federal and state agencies as well as other stakeholders including forest landowners, foresters, conservation groups and the academic community. This body will advise the Secretary on outreach objectives, programs and implementation, cooperation and coordination among agencies and other stakeholders, and assessment of impacts.
Enhancing Existing Authorities
There are significant opportunities to meet SAF long and short-term goals through modifying or enhancing existing authorities.
The Cooperative Forestry Assistance Act of 1978 (CFAA) is the base legislation for a variety of forestry related programs authorized and funded, in part, by the Federal Government. The 1990 Food, Agriculture, Conservation and Trade Act (the farm bill) added a Title XII, called the Forest Stewardship Assistance Act (Congress amended the CFAA with title XII.) Congress authorized programs like the Forest Stewardship Program, Forestry Incentives Program, Stewardship Incentives Program, Forest Legacy Program, and others through these titles.
Overall, the 2002 farm bill conservation title should include sustainable forestry as a program objective, equal with wildlife habitat and other objectives. SAF asks that Congress rename Title XII as the Sustainable Cooperative Forestry Assistance Act. This title change will reflect the forestry community's efforts to ensure that sustainable forestry is practiced everywhere in the United States. Additionally, several of the programs we are advocating are truly focused on sustainability, and ensuring forests stay forested.
Page 59 PREV PAGE TOP OF DOC The SAF believes that several of these programs are operating effectively, and that others need modification.
Forest Stewardship Program (Section 1215)The program is functioning extremely well, providing technical forestry advice to 180,000 landowners covering 22 million acres of forest in the ten years since its inception. We believe Congress should build in flexibility in implementing the program and support substantial increases in appropriations. Congress should modify the Forest Stewardship Program to express two main goals: building the capacity of state and local agencies to assist forest landowners in managing their forests sustainably, and allow programmatic delivery of technical assistance to meet the requirements of Federal mandates.
Forest Legacy Program (Section 1217)We support the continuation of the Forest Legacy Program. The Legacy Program is achieving its objectives with excellent results. The only suggestion we might offer is to raise the spending authority for the program, as new states continue to complete assessments and request Federal funding.
Urban and Community Forestry Assistance (Section 1219)We support the continuation of Urban and Community Forestry Assistance as it is an effective program and connects urban residents to the forested environment in addition to enhancing the urban environment with beneficial forest cover.
Wildlife Habitat Incentives Program (WHIP) (Title IIIMiscellaneous Conservation Provisions of the 1996 farm bill) Working through state technical committees, WHIP is designed to help landowners improve wildlife habitat. The program provides cost-share funding to develop habitat for upland wildlife, endangered species, fisheries, and other wildlife. SAF would like to see more funding reach non-industrial forest landowners, and we would like to see those funds focused on developing habitat conservation plans.
Conservation Reserve Program (CRP)It is important to SAF that CRP funds be invested in conservation practices that have the potential to last beyond the 10-year contract period. We believe several changes that involve increasing incentives for tree planting, and the use of long-term easements could enhance the public benefits of the CRP program.
Page 60 PREV PAGE TOP OF DOC Environmental Quality Incentives Program (EQIP)EQIP is another program that could benefit from an enhanced commitment to using trees and forests to meet its objectives.
Conservation Reserve Enhancement Program (CREP)This program continues to show promise in producing public benefits from private lands. There will be a need for continued investment, and expansion of the program to lands that are predominately forested. All resource lands should be eligible, not just those with a cropping history.
Forestry Research focused on non-Federal lands
We support the continuation and expansion of forestry related research programs, and stress the important role outreach and research play in sustainable forestry.
THE COOPERATIVE FORESTRY (MCINTIRE-STENNIS) RESEARCH PROGRAM
The Cooperative Forestry (McIntire-Stennis) Research Program supports long-term research on forestry and wood fiber conducted by the Nation's public universities. University-based research is an important part of the collaborative forestry research effort involving Federal, state, and private sector scientists. McIntire-Stennis research is critical to the development of new information and technologies that increase not only the efficiency and productivity of forest management on all forest ownerships for a wide range of forest benefits, but also provide information for developing natural resource management policy. McIntire-Stennis research funds are granted directly to public colleges and universities on a matching basis leveraging more than three state and university dollars for every Federal dollar. We strongly support these efforts and ask that Congress increase authorized spending on the program.
Statement of Robert Fledderman
Mr. Chairman, members of the committee, I appreciate the opportunity to present my testimony today on the forest industry's perspective for reauthorization of the 1996 farm bill. There is tremendous opportunity for the Congress to make its mark on supporting and promoting the concept of sustainable forest management in this new 21st century. My testimony today will focus on the successes and weaknesses of forestry programs that were adopted over a decade ago as well as reasons why a new forestry title is warranted to address the changing face of forestry.
Page 61 PREV PAGE TOP OF DOC My name is Bob Fledderman and I am the Environmental Manager for Westvaco's Forest Resources Division. Westvaco is a major manufacturer of paper, packaging and specialty chemicals, employing nearly 18,000 men and women. Westvaco owns and manages nearly 1.3 million acres of forestlands in the United States in adherence with the Sustainable Forestry Initiative Program (SFITM). These highly valued forest holdings support mill operations in six southeastern states.
Additionally, Westvaco foresters work directly with 2,800 private non-industrial landowners under our own landowner assistance program that is designed, in part, to educate landowners about sustainable forestry. Participants in Westvaco's Cooperative Forest Management (CFMR) program together own almost 1.4 million acres.
I mentioned the SFITM program and I would like to take a moment to describe this private sector program. It is a comprehensive system of principles, guidelines and performance measures that integrates the perpetual growing and harvesting of trees with the protection of wildlife, fish, plants, soil, air and water quality. As of today, there are over 100 million acres enrolled in the SFI program. This is the industry's response to showing the world a higher standard by committing to the practice of sustainable forestry on its own lands and promoting these practices by further involving non-industrial landowners, loggers, consulting foresters, and company employees who are active in wood procurement and landowner assistance programs.
Congress has a tremendous opportunity to assist non-industrial private forest landowners in striving to achieve sustainable forest management as the SFI does for industrial lands. We are not asking Congress to duplicate or fund the SFI but rather to be a catalyst and major participant in promoting the concepts and ideas of sustainable forestry.
As authorized under the 1985, 1990 and 1996 farm bills, state foresters provide valuable technical assistance services. Our industry's perspective is unique with regard to non-industrial landowners, as approximately 75 percent of all annual forest harvests are received by the members American Forest & Paper Association, according to the most recent information contained in the AF&PA Sustainable Forestry Initiative (SFITM) report. As such, we have a special role in encouraging and supporting programs that can broaden public and non-industrial landowner awareness regarding sustainable forestry practices.
Page 62 PREV PAGE TOP OF DOC Rationale for a forestry title in a 2002 farm bill
The 1990 farm bill contains the Forest Stewardship Program (FSP), the Stewardship Incentives Program (SIP) and the Forestry Incentives Program (FIP) of Title XII, among many other program authorities. In the past decade, however, dramatic shifts have taken place in forest dynamics including:
Global competition has intensified;
The virtual locking up of America's national forests has led to a greater dependence upon private non-industrial forest landowners to supply timber and wood products;
Accordingly, annual timber harvests from non-industrial private forests have increased twenty percent between 1991 and 1996; and combined non-industrial and industrial private forests accounted for 89 percent of annual removals in 1996, up from 82 percent in 1991. This is a trend we are sure has continued.
A growing US population is demanding non-industrial landowners to supply increasing quantities of wildlife habitat, clean water, and other forestland related amenities.
There has been a substantial increase in the number of individuals who own forested land, particularly in the south where ownership levels are expected to double over the next 25 years, according to the USFS;
State forestry agencies and commissions are taking on greater environmental responsibilities in addition to their traditional roles of fire prevention and suppression and must demonstrate progress in forest resource management.
Despite these changing dynamics, direct Federal assistance to non-industrial private forest landowners is a scant $6 million through the Forestry Incentives Program, representing less than one-half of one percent of all commodity support. It is appropriate at this time to reassess the nation's commitment to sustainable forestry and determine how programs can be enhanced, and improved.
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The Need for New Programs and Modifications to Existing Program Authorities
Today, only ten percent of private forest landowners use a professional forester when harvesting their timber. Education and outreach on sustainable forestry programs and practices are insufficient to meet current needs. And looking ahead, given the expected increase in the number of landowners, the Nation will need upgraded delivery of forestry programs and services to reach these new owners. Congress by modernizing these forestry programs can help achieve sustainable forest management goals.
The primary delivery mechanism for forestry programs is through the Forest Stewardship Program established in the 1990 farm bill. It is our belief that this program remains a viable and useful framework. There are two specific ways in which we believe Congress could improve the Forest Stewardship Program. First, build the capacity of state agencies to assist forest landowners in sustainable forest management. Second, allow programmatic delivery of technical assistance to meet the requirements of Federal mandates. Specifically, we recommend that the Forest Stewardship Program be amended to provide the state foresters with authority to focus resources on priorities established through their offices and State Forestry Technical Committees. This should include authority to hire state water quality foresters, wildlife foresters, technical assistance foresters and liaison foresters to work with local communities or other state agencies engaged in forestry issues. Additionally, express authority should be given to state foresters or their equivalent to prepare grants and seek proposals from non-governmental organizations and consultants that promote and expand sustainable forestry programs on private non-industrial lands. In concert with many of the state foresters, we support increased spending authority and appropriations for the program, as well as building-in program implementation flexibility.
As I mentioned earlier, the only forestry program providing financial assistance that is funded by the Federal Government is the Forestry Incentives Program (FIP). This program provides cost-share funds for tree planting, site preparation and thinning. While we believe this is an essential element of sustainable forestry, it is only a small part of the myriad of practices that together achieve sustainable management. In fact, the FIP represents less than one-half of one percent of all commodity payments. The Stewardship Incentives Program (SIP), a cost-share assistance program also authorized in the 1990 farm bill, was designed to enroll private non-industrial forest landowners into a program that would require written management plans. Due to a variety of Federal requirements, state foresters were unable to accomplish this goal. As a result, the Forest Stewardship Program was unable to achieve the goal of enrolling 25 million acres by 1995. Given the lack of participation in the program and inability to sell it to landowners, Congress terminated its appropriation the past three years.
Page 64 PREV PAGE TOP OF DOC To enhance and promote all sustainable forestry practices, we believe it is now time to combine the FIP and SIP and create a comprehensive and integrated program titled the Sustainable Forestry Incentives Program (SFIP). To obtain public benefits such as clean water, drinking water, improved resource protection, enhanced wildlife habitat and encourage the practice of sustainable forest management activities, an SFIP should be flexible enough to encourage private landowners to conduct a variety of environmentally beneficial sustainable forestry practices. These practices could include:
Obtain professional forester assistance;
Facilitate conservation easements on lands threatened by development pressures;
Logger education & training;
Invasive pest control;
Fire hazard reduction;
Wildlife and fish habitat enhancement;
Other activities and practices designed to promote and implement sustainable forestry
The ultimate goal of the SFIP will be to entice non-industrial private forest landowners to participate in programs and then explain the benefits and rewards of developing written management plans. We believe this type of program would need substantial financial support from the Congress.
An amended forestry title that contained these programmatic elements, new authorities and additional incentive payments will link state forestry agency programs and practices into a comprehensive effort to address forest sustainability. It will allow the state foresters to work with landowners and their fellow state agencies. It will also be useful to meet other state or Federal mandates. It will provide them with the administrative flexibility to target resources; personnel and contractors to issues they believe are most urgently needed.
Page 65 PREV PAGE TOP OF DOCThe single most useful thing we can do to better protect our environment is to keep forestlands forested and perhaps add a few more. With increasing development pressures and growing regulatory constraints, that is a difficult task. We submit that the best way to protect forestland is to enable private landowners to profitably manage their forestlands while using sustainable forestry techniques. We believe the program changes we propose here and an increased level of financial support will be a significant first step in reaching that goal.
Other Forestry-Related Programs of the farm bill
From the AF&PA perspective, I have testified today on programs to improve and enhance coordination, cooperation and assistance to non-industrial private forest landowners. There are other important titles and programs authorized in the farm bill that are of significant and strategic importance to the industry including the Trade title, Conservation title, forest research including product utilization, forest inventory and analysis and forest carbon sequestration. Rather than spend time today discussing these areas, we have briefly described some of them below. At a future point, I would request that AF&PA reserve an opportunity to engage the Chairman and members of the Committee in these areas.
Forest Research Priorities
As a member of the National Coalition for Sustaining America's NonFederal Forests, AF&PA supports a collaborative, multi-organization effort to ensure the sustainability of our nation's nonFederal forestlands through research, education, and extension.
We believe it is important to maintain and expand existing farm bill authorizations related to:
Forest Inventory & Analysis (FIA)
The FIA program is administered through USDA Forest Service Research and provides data needed to measure forest growth, health, and other essential information needed to make resource allocation and forest policy decisions. There is widespread recognition within the forestry community of a critical need for more accurate and timely data.
Page 66 PREV PAGE TOP OF DOC Competitive Grants for Forest Productivity Research
Competitive grants that require collaboration, matching funding, and peer review selection assure quality research and the most efficient allocation of limited resources. The need for pragmatic research designed to produce and measure healthier, faster growing forests far exceeds supply. farm bill authorizations for competitive grants focused on forest productivity in the areas of biotechnology/tree improvement, forest soil productivity, tree physiology, and forest information technology should be expanded within USDA.
McIntire Stennis Cooperative Forestry Research Act
This is administered through the USDA Cooperative State Research, Education, and Extension Service (CSREES) and provides critical core funding for forestry research and for training students in forestry science at universities. Federal funding is matched more than three times by universities with state and nonFederal funds.
Renewable Resources Extension Act (RREA)
This is administered through the USDA Cooperative State Research, Education, and Extension Service (CSREES) and provides the foundation for outreach and extension efforts delivered to private landowners through universities.
National Research Initiative Competitive Grants Program (NRICGP)
This is administered through the USDA Cooperative State Research, Education, and Extension Service (CSREES) and provides competitive grants funding for agricultural and forestry research.
Statement of C.P.P. (Patrick) Reed
Mr. Chairman and Members of the Subcommittee, my name is Patrick Reid. I am the Director of the School of Renewable Natural Resources at the University of Arizona and am here in my capacity as President-elect of the National Association of Professional Forestry Schools and Colleges (NAPFSC). NAPFSC is comprised of the 67 universities that conduct the Nation's research, teaching, and extension programs in forestry and related areas of environmental and natural resource management. NAPFSC schools work in close partnership with the USDA research programs through extramural contracts and cooperative agreements. We appreciate the opportunity to provide this testimony on our priority farm bill issues.
Page 67 PREV PAGE TOP OF DOCBACKGROUND
The 1998 farm bill and various subsequent reports and conference proceedings have identified the need for greater attention on the emerging issues confronting non-Federal forest lands. Today these forests are facing threats from a myriad of factors. Many private landlowners are poorly equipped to make informed decisions about the management of their lands. Yet these decisions in the aggregate have important ecological, economic and social implications for society.
NAPFSC is pleased be one of the cofounders of the National Coalition for Sustaining America's NonFederal Forests. The Coalition and its subsequent report came out of a Forestry Summit held in 1999 that brought together key forestry leaders and landowners from across the nation. I would like to note the coalition report was recently sent to every member of Congress. The outcome of the Summit confirmed the need for increases in forestry research funding focused on non-Federal lands and for an increase in collaborative efforts between university-based research and the Federal agencies. There is great capacity in our nation's research universities to provide more research and educational outreach.
The National Coalition for Sustaining America's NonFederal Forests has documented a plan of action to conserve and sustain our nation's nonFederal forest lands. The plan stresses the importance of cooperation among the public universities, state forestry agencies, Federal agencies, and the many forest land stakeholders. Key elements of this plan are research capacity and concerted action on stakeholder priorities. The report documents the need for a substantial investment to provide the science foundation for the sustainability of these forests, to transfer this knowledge into on-the-ground management and conservation practices, and to build local professional capacity in every forested region of the nation. NAPFSC endorses this long-term plan and recommends the incorporation of a forestry title, with a subtitle dealing with Research, Education and Extension, for the farm bill. Below we outline the essentials of such a subtitle and our recommendations.
Page 68 PREV PAGE TOP OF DOCPROPOSED SUBTITLE: FOREST RESOURCES RESEARCH, EDUCATION, AND EXTENSION/OUTREACH
Focus: A National Initiative for Stewardship and Sustainability of America's NonFederal Forests
Statement of Need and Background:
The sustainability and stewardship of America's nonFederal forests are economically, environmentally, and socially vital to the Nation. These lands and their 10 million owners furnish 65 percent of the Nation's wood supply and form the core of a forest industry that accounts for 8 percent of the Nation's manufacturing economy. In addition, these lands provide the principal habitat for 75 percent of the Nation's fish and wildlife resources, the foundation for a $100 billion outdoor recreation industry, the major source of the Nation's water supply, and the source for carbon sequestration. The sustainability of the 487 million acres of nonFederal forestland is critical to providing these uses and values to enhance the quality of life of citizens. Yet the research and education capacity to support these uses is insufficient to the task before us.
Today these nonFederal lands are threatened by urbanization, fragmentation, forest health problems, and increased harvesting pressures. Exacerbating the issue is a growing number of private forest landowners inexperienced in forest stewardship practices, and thus, ill equipped to make informed decisions about their forests. Moreover, America's society is increasingly disconnected from ecosystems and the natural environment that provides its goods and services. Clearly, sustainability requires maintaining biodiversity and improving productivity, yet in a socially acceptable and cost effective manner.
Page 69 PREV PAGE TOP OF DOC Research, education and extension/outreach are prerequisites to nonFederal forest sustainability. A principal provider of nonFederal forestry research, education, and extension/outreach is the nation's state colleges and universities, particularly those with land grant status (1862, 1890, and 1994). These institutions possess the expertise and infrastructure to conduct research and educational programs to transfer new information to these forest landowners. Further, these institutions also provide the trained professionals we need for research, extension and the implementation of new and improved practices.
These critical research, education, and extension/outreach needs are consistent with the findings of the National Coalition for Sustaining America's NonFederal Forests Report entitled: A National Investment in sustainable Forestry: Addressing the Stewardship of NonFederal Forestlands through Research, Education, and Extension/Outreach, and the Report of the National Research Council of the Academy of Sciences entitled: A Forested Landscapes in Perspective: Prospects and Opportunities for Sustainable Management of America's NonFederal Forests.
NAPFSC supports inclusion of this forestry research subtitle to improve the coordination of existing authorizations in an effort to integrate and implement a national program on research, education and extension/outreach in conjunction with private and Federal agencies. This effort needs to focus on efforts to more effectively address the sustainability of nonFederal forests. Specific recommendations are:
Fund the McIntire-Stennis Cooperative Forestry Research Act (CFRA), and the Renewable Resources Extension Act (RREA) at their authorized levels of $105 and $15 million respectively, and while doing so, target priority research and extension needs and build research and extension capacity.
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Reauthorize and increase the authorization of RREA to $30 million.
Increase the Natural Resources and Environment section of the National Research Initiative (NRI) by $30 million to incorporate Agenda 2020 priority issues of soil productivity, plant responses (physiology), and information technologies including remote sensing.
Require the Forest Service to increase collaborative research programs between the Forest Service and University-based research partners.
Require the Forest Service to implement a competitive grants program within the Forest Service research function as authorized in the Agricultural Research, Extension, and Education Reform Act of 1998.
Increase the Plants section of the National Research Initiative by $10M to address forest biotechnology.
Increase Forestry Higher Education funding for CSREES by $10 million to educate and provide a professional workforce to address these needs.
Improve and enhance the coordination of programs that contribute to the stewardship and sustainability of nonFederal forestlands and to better utilize the research, education and extension/outreach expertise and products provided by the nation's forestry and natural resource schools.
Page 71 PREV PAGE TOP OF DOC Suggested Report Language
Create a National Advisory Board on NonFederal Forests and four (4) regional Research and Education Centers that would coordinate and integrate research, education and extension/outreach with Federal financial and technical assistance programs to engage forest landowners in sustainable forestry.
Create a new program entitled ''Technology Transfer and Applied Research'' to forestry schools under the Cooperative Forestry Program in the State and Private Forestry (S&PF) budget.
Suggested Report Language:
Create a Technology Transfer and Applied Research (TTAR) line under the Cooperative Forestry Programs in the USDA State and Private Forestry budget and direct the S&PF staff to establish criteria for a challenge cost share program by consulting with forestry schools eligible to receive funds under the McIntire-Stennis Cooperative Forestry Research Act. Criteria may include cost sharing, duration of funding, linkage to state forestry agency efforts, linkage to basic and applied research conducted by the subject schools or the USDA Forest Service Research and Development, addressing critical state needs, and multi-school or multi-state cooperation. General themes for this new line may be forest productivity, critical forest management information and analysis, and forest fire, or they may vary in consultation with the regions (Northeast, Southeast, and West). Funds would be equally allocated between the three regions. This Technology Transfer and Applied Research (TTAR) program shall be between the three regions. This Technology Transfer and Applied Research (TTAR) program should be funded in FY2002 at $5 million.
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Improve Forest Service priority setting for outreach and cooperative programs.
Suggested Report Language
Direct the Forest Service to develop a plan within 90 days of enactment of this bill to establish a S&PF Area Office to deliver cooperative programs in the Western U.S. Further, Area Office should be co-located with a Forest Service regional office, research station, or university forestry school. In addition, managers direct the Forest Service to reestablish the Southeastern Area Office situated in Atlanta, Georgia.
IMPLEMENTATION AND OUTCOMES OF THESE RECOMMENDATIONS WILL ENSURE:
A foundation of research-based knowledge that allows informed decision-making on the management and conservation alternatives necessary to achieve the objectives of America's nonFederal forestland owners and society at large.
A cadre of forest resource professionals with the skills necessary to address the needs of all segments of our society, especially those that manage and provide stewardship on nonFederal forest lands.
An established and effective extension and outreach infrastructure that provides timely delivery of knowledge based products to those who must make management and policy decisions concerning nonFederal forestlands.
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Finally, the recommendations for research, education, and extension/outreach will strengthen this nation's commitment and capacity to sustain our nonFederal forests into the 21st century and for many generations to come. The specific outcomes that will make this possible include:
Increased scientific understanding, dissemination of knowledge and information, and improved management methods that make it possible to sustainability use nonFederal forests to meet landowner objectives and public expectations.
A broadly educated professional cadre, recruited from diverse cultural backgrounds, having the skills and knowledge needed for sustainable management of nonFederal forests.
An American public that understands the benefits they receive from nonFederal forestland and thereby actively support sustainable forest management.
Ultimately, there investments will make the difference and lead us towards truly productive and sustainable nonFederal forests and increased opportunity for the nation.
NAPFSC and our individual member schools look forward to working closely with the Senate and House Agriculture Committees and with the Bush Administration to create an increased focus on nonFederal forestlands as discussions and implementation of the 2001 farm bill move forward.
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Statement of Chuck Leavell
I'd like to begin with a quote from a famous American: Kermit the Frog. When he said it isn't easy being greenhe could have been talking about people like me.
I'm one of 65,000 members of the American Tree Farm System. We're all different. Some of us are teachers, doctors, truck drivers, policemen, lawyers, judges, governors, senators, and members of this House. Some are rock and roll musicians, like me.
But in one important way, we're all the same.
What brings us together is a commitment to sustainable forestry. Each of us has pledged that we'll manage our forest lands for water quality, soil conservation, wildlife habitat, recreationnot just timber. We do this because we believe that healthy, thriving forests are important for our families, for our neighbors and our communitiesand most importantly, for our kids and their kids too. We preach what we practice. One of the most gratifying sights to me is seeing the Tree Farm sign appear on my neighbors' land. They've watched what my wife Rose Lane and I have done on our Tree Farm, and they've begun to do it, too.
Tree Farmers own tracts that total about 26 million acressome of the most beautiful, diverse and sustainably managed forest land in the US. Most of us own less than 100 acres. We are represented in virtually every state and forested county. [See Appendix A]
That's the good news. There's plenty of excellent sustainable forestry being practiced by members of the American Tree Farm System and by other outstanding woodland stewards.
So what's the bad news? Why isn't it easy for Certified Tree Farmers to be ''green?'' Just as important, what will it take for all 10 million forest owners to be ''green'' like us?
Page 75 PREV PAGE TOP OF DOC The answers to these questions are complicated. From my perspective, there are four important reasons.
First, some kinds of investments are rewarded by existing government programs and policies. Unfortunately, investing in forests isn't near the top of that list.
Second, most of the 10 million forest owners in the US [as many as 90 percent] either don't consult a professional before they harvest trees, don't know where to find forestry assistanceor, most troubling, don't even know they should ask for it. Frankly, many forest owners don't know what they don't know. They don't think ahead and plan for the future of their forests. And that's the cornerstone of sustainability.
Third, the Federal programs and incentives provided for forest owners are meager, fragmented and often delivered in a way that limits the number of forest owners they can serve. Many of the conservation programs already in place do not place a high enough priority on conserving and sustaining forests.
The lines to get access to these incentives are longtoo longand forest owners are almost always stuck at the back. They rarely make it to the front.
Fourth, while forest owners produce a lot, they don't necessarily get much for it. What products do we produce? Wood for houses and books is one, of course. But also clean water, storm water protection, carbon storage, clean air, plant and wildlife habitat, recreation andincreasingly important, green space that can provide relief from crowded cities. These are vital public goods, but right now most owners don't have an income stream to support them.
We're asked to do more and more through Federal and state mandates. However much we might want to do it, if forestry becomes too expensive, saying yes to a developer may be our only, viable choice. Investing in trees is long-term, risky and, when you consider that many of us have to wait between 10 and 40 years to get a check if we get one at all, not all that profitable.
Page 76 PREV PAGE TOP OF DOC We believe the upcoming farm bill provides Congress with an opportunity to address these problems, and that the solutions are within your grasp. On behalf of the 65,000 members of the American Tree Farm System we urge you to consider the following proposals:
1. Blend the Forestry Incentives Program and the Stewardship Incentives Program into a single program, the Sustainable Forestry Incentives Program.
The aim of this new program will be to provide Federal funding that supports conservation practices on private, non-industrial forests. We believe that the range of practices should be broad, and that Congress should consider mechanisms that reward owners who have already invested large sums of money, time and energy in implementing them.
Because forests and forestry differ so much from state to state, we believe that the program decisions should be made at the state level. State stewardship committees which are broadly representative of all stakeholders, including forest landowners, should determine what practices are eligible; the state forestry agency should implement the program.
Enacting this new incentive program will meet two of our most critical goals: making it easier for forest owners to gain access to programs that support sustainability and forest conservation, and insuring that administrative costs are held to the minimum necessaryputting public funds to work on the ground, not back at the office.
We support mandatory funding for this program at $150 million.
Create a new program called the Sustainable Forestry Outreach Initiative.
Most landowners don't know what they can accomplish through better forestry. They don't know what's possible, or where to turn to get the professional advice that can make it happen.
The consequences for them and their forests are enormous. Without good planning, owners can get short-changed on the income from a timber harvest. They can neglect easy steps that will protect wildlife and water quality and insure the future health of their woodlands.
Page 77 PREV PAGE TOP OF DOC We believe that Congress should enact within the farm bill a Sustainable Forestry Outreach Initiative that coordinates and strengthens both public and private sector efforts to get forest owners on the path toward sustainability.
An important part of that effort will be facilitating contact between forest owners who are already managing their forests sustainably, and those who are not. Our sixty years of experience with the American Tree Farm System affirms that this kind of peer-to-peer contact is a powerful catalyst for promoting sustainability. People see what you do, and what you get out of it, and they want to do it too.
We recommend an authorization of $45 million a year to support this Initiative.
Strengthen and sharpen the focus of existing conservation programs.
As a landowner myself, I see first hand which programs work well and which could work better in getting more people like me to do more to sustain their forests. Specifically, we recommend:
The Forest Stewardship Program should be authorized and funded at a higher level. It should be aimed at two main goals: building capacity at the state and local level to assist forest owners; and allowing these agencies to deliver technical assistance that will help meet all the various Federal mandates that are laid on usfor water quality, wetlands, species conservation, and all the rest.
There's an alphabet soup of other farm bill programs that could get more owners practicing sustainable forestry: Wildlife Habitat Enhancement Program, the Conservation Reserve Program, the Environmental Quality Incentives Program and the Conservation Reserve Enhancement Program. That's WHIP, EQUIP, CRP and CREP.
All of these programs could be strengthened by making sustainable forestry a priority objective for each of them. And if there's a way to help forest owners navigate the mazeperhaps through some form of state-level one-stop shoppingwe urge you to consider it. Remember, most forest landowners aren't farmers, though they do produce a crop. And many of them, like me, aren't certain where to turn to get the help we need.
Page 78 PREV PAGE TOP OF DOC I've just written a book about how Rose Lane and I become involved in forestry and what it means to us. We named it Forever Green, like our philosophy of conservation. And from everything we've learned, I believe we're at a critical turning point in the history of our Nation's forests to keep them ''forever green.''
Here's what we know about the future:
We know that most forests will be owned by families and individuals like memore than 10 million of them. Right now, we own about half of all the nation's forests.
We know that this number will grow, because our median age is high. Over 90 million acres of family forestland is owned by folks who are over 65.
We know that forest tracts are going to get smaller, and more fragmentedand more susceptible to development. Between 1953 and now, the average size of a family woodlot decreased from 45 acres to less than 20. Without an adequate income stream to support your investment in trees, selling out can become a financial necessitynot an option.
We know smaller tracts and uncertain income from forestry could mean more loss of forested acres, as developers build for a growing population. Between 1850 and 1983, New Hampshire's forest grew, from a low of 43 percent of the state's area to 87 percent. Since then, New Hampshire has lost nearly 150,000 acres of forest to development. In Virginia, the amount of land developed each year has increased by nearly 50 percent from 1982 to 1997. This is sprawl: forest lands will shrink as cities grow.
We know that fewer trees and forests hurt our communitiesnot just because we've lost green space, but because giving up forests can cost real money. EPA estimates that storm water control costs in the Chesapeake Bay watershed increased by over $1 billion as forest cover decreased from 51 percent in 1973 to 38 percent in 1997.
But things don't have to turn out like this. The American Tree Farm System is part of a larger coalition of groups concerned about the future of our nation's private forests: land
Page 79 PREV PAGE TOP OF DOCowners, forestry professionals, agencies and academics. For the past year, we've been working together to understand these problems and how to solve them.
We are pleased to support the farm bill recommendations you will hear today. They may not be the last word on how to keep our nation's forests green and growing, but we are convinced they represent a good place for us to start.
Statement of the Intertribal Timber Council
Mr. Chairman, I am Fred Matt, President of the Intertribal Timber Council and Chairman of the Confederated Salish and Kootenai Tribes of the Flathead Reservation of Montana. On the behalf of the Intertribal Timber Council, I hereby submit this testimony for the Subcommittee's consideration and inclusion in its record of this hearing.
Mr. Chairman, my testimony today requests that the 2002 farm bill amend the Cooperative Forestry Assistance Act to include four programs to facilitate cooperation and consultation between Indian tribes and the U.S. Forest Service, and to provide equitable tribal participation in that Act.
Background. The Intertribal Timber Council (ITC) is a twenty five year old organization of seventy forest owning tribes and Alaska Native organizations that collectively possess close to seventeen million forest land acres that provide habitat, cultural and spiritual sites, recreation and subsistence uses, and through commercial forestry, income for the tribes and jobs for their members. In Alaska, the forests of Native corporations and thousands of individual allotments are equally important to their owners.
A significant portion of our forest lands have common borders with U.S. Forest Service land, and many tribes have treaty rights and trust resources within Forest Service land. But despite our common borders, despite our long history as neighbors with similar and shared landscapes and resources, and our trust and treaty rights on Forest Service lands, the Forest Service and tribes have remained too often distant. There is a need to improve cross-boundary cooperation, consultation, and equitable tribal participation in the Service's public programs.
Page 80 PREV PAGE TOP OF DOC Accordingly, we were very encouraged when the Chief of the Forest Service established a national Tribal Relations Task Force in October, 1999 to begin to address these concerns. The Task Force, with tribal participation, has completed its report, which is available on-line (www.R5.FS.FED.US/tribal-relations) and is now being printed. Currently, a Forest Service Implementation Team is moving to effectuate the recommendations of the Task Force.
Request summary. The ITC believes the current reauthorization of the Farm Bill, and in particular its potential revision of the Cooperative Forestry Assistance Act, offers an excellent opportunity for the Congress to meet two of the Task Force's key recommendations: (1) improve USFS consultation and coordination with Indian tribes at the local level, and (2) assure more equitable tribal participation in Cooperative Forestry Assistance Act programs.
To do this, we suggest the Cooperative Forestry Assistance Act be amended to provide a separate tribal section in the Act for four programs:
To facilitate consultation and cooperation -
(1) authorize a USFS program of financial assistance to tribal governments for increased cooperation and participation in U.S. Forest Service planning and management activities regarding trust, treaty, and religious and cultural issues on Forest Service land, and in trans-boundary issues such as wildlife, water, fire, and forest health.
To provide more equitable tribal participation in the Cooperative Forestry Assistance Act -
(2) authorize a USFS program of assistance to tribal governments for conservation education and awareness programs within a tribe's reservation,
(3) authorize a USFS program of assistance to tribal governments for the provision of technical assistance to tribal and individual Indian forest land owners, and
(4) authorize a USFS program of assistance to tribal governments to secure conservation interests in forest lands owned by individual Indians.
Indian forest land in the Cooperative Forestry Assistance Act
Page 81 PREV PAGE TOP OF DOC Indian tribes and individuals are the beneficial owners of 17 million acres of forest land, from which approximately 750 million board feet are eligible for sustainable annual harvest. While the great majority of tribal land and most individual Indian forest land are held in trust by the United States Department of the Interior, the tribal and individual Indian owners of these lands share many of the prerogatives of state or private ownership. For instance, Indian governmental and individual forest land owners exercise general discretion over the use of the land, decide whether and what to harvest, and receive the income from the sale of resources. This similarity with state and private forest land owners is already recognized in the Cooperative Forestry Assistance Act, in which tribes are specifically cited as eligible for the Forestry Incentives (Section 4) and Forest Stewardship (Section 5) programs.
But, as reported by the Forest Service National Tribal Relations Task Force report on page 7 under ''Review Administration of Forest Service Programs,'' ''we should explore opportunities to improve the design of programs to meet the specific needs of tribal communities.''
Tribal and individual Indian forest lands, which contribute significantly to the national forest land base and harvest levels, should fall within the overall purpose of the Cooperative Forestry Assistance Act: to improve the management, productivity, and health of nonFederal forest lands. And management of our forest land shares many of the same needs and deficiencies as state and small private forest lands. Often at the tribal governmental level, there is insufficient forest management capacity to fully manage our own lands, let alone extend technical help to individual Indian land owners. We, too, need assistance in managing and conserving our forest lands, and more specific inclusion of tribal and individual Indian forest lands in the Cooperative Forestry Assistance Act would help the Act better achieve its purposes and goals.
Barriers to Indian participation in the Cooperative Forestry Assistance Act
Page 82 PREV PAGE TOP OF DOC State administration and certification of the Coop Act's programs and the acreage limitations are sharp disincentives to tribal participation. Individual Indian land owners who should be beneficiaries under the Coop Act are even further alienated from its programs, if not completely barred from participation.
Tribes and individual Indian land owners encounter a number of barriers when attempting to participate in the Coop Act programs. One significant barrier, noted in the Task Force report, is the Coop Act's administration of its programs through states. Indian tribes are sovereign governments with principal authority over tribal and individual Indian land within our reservations. Individual Indian forest land owners generally look to the tribal government and the Interior Department as having responsibility over their land, and so are very unlikely to have forest management plans developed ''in coordination with and approved by the State.'' As Indian tribes, we have a special relationship with the United States and should not be required to work through state offices in order to participate in a Federal program. As noted in the Forest Service Tribal Relations Task Force report's discussion of the Cooperative Forestry Assistance programs (Background, page 35), '' Current authorities require the FS to administer cooperative forestry funds to private landowners through the State Forestry Programs. Some Indian Tribes believe that the need to request assistance through state forest organizations is inconsistent with the Federal trust relationship and the government-to-government relationship with the FS.''
A second barrier is the lack of explicit recognition within the Coop Act of the capacity to provide assistance to individual Indian forest land owners whose land is held in trust. Although individual Indian forest land owners are closely akin to the small private land owners that are principally sought to be assisted by the Coop Act, individual Indian forest land in trust receives few, if any, benefits under the Act. Individual Indian forest land owners whose land is held in Federal trust are not specifically mentioned in the definition of ''private forest land,'' and to the extent tribes are cited, it could be inferred that individual Indian owners in trust are deliberately excluded. Such uncertainty only makes individual Indian land owners less inclined to inquire about and pursue assistance under the Coop Act.
Page 83 PREV PAGE TOP OF DOC The acreage limitations are another barrier preventing Indian tribes from participating in Coop Act programs. While individual Indian lands, which typically are smaller than 1,000 acres, may qualify, all but the very smallest tribal forests are larger than both 1,000 acre general limit and the 5,000 acre exception, rendering them ineligible.
And finally, there is the ambiguity regarding the effect of assistance provided tribes and individual Indian land owners by the Bureau of Indian Affairs. The level of assitance provided by the BIA is far less than the need. The BIA Forestry budget is about $48 million a year. The Assessment of Indian Forests and Forest Management in the United States, a blue ribbon independent review of Indian forestry published in November, 1993, determined ''[c]urrent funding for Indian forestry is only 63% of that for timber production for the National Forests, only 50% of that for timber production for private forestry in the Pacific Northwest, and only 35% of that for coordinated resources management for the National Forests'' (IFMAT report, page V3). Section 5(e) in the Coop Act Stewardship program excludes lands ''in management under Federal ... assistance programs,'' although there is also a potentially applicable exception. Indian tribes, by being specifically mentioned as eligible in Section 5(c), are evidently not affected by this exclusion, but the ability to provide assistance for the management of Indian forests remains unclear
Why a separate section?. We believe a separate section for tribal-specific programs in the Cooperative Forestry Assistance Act is warranted for several reasons. (1) A separate section could set up programs administered directly between the Forest Service and tribal governments. Tribal governments have a direct and unique government- to- government relationship with the United States that should be recognized and supported. Programs in the current Coop Act are principally geared for implementation through, or with the concurrence of, the states. (2) Attempting to amend existing programs to establish a separate component for tribal government would be very cumbersome. (3) Further, a separate section would allow a more appropriate range of programs tailored to meet the needs of tribal communities rather than simply appending tribal governments to current Cooperative Forestry Assistance Act programs principally geared for states. (4) Finally, a separate section, with a separate authorization of appropriations, would alleviate competition for funding that is already inadequate for existing interests in established programs.
Page 84 PREV PAGE TOP OF DOC Program 1) Why a program to facilitate cooperation and consultation with tribes?
As noted above, tribes and the Forest Service share very extensive boundaries, and must contend with issues that require close coordination and consultation. Also, tribes often have reserved rights, such as hunting, fishing, and gathering, to utilize Forest Service land and resources. The Forest Service not only has an obligation to fully abide by and protect those rights, it also has an affirmative obligation to preserve the resources upon which the exercise of those rights may depend. Further, the Forest Service is obliged to protect and preserve sites and resources of cultural and religious significance to tribes. Clearly, tribal interests are deeply intertwined with those of our Forest Service neighbors, and tribes should have the capacity to actively take part in USFS decisions bearing upon the tribe's interests.
The Forest Service National Tribal Relations Task Force report, on page 3, notes ''many tribes are now seeking increased collaborative involvement in FS decision-making that affects tribal rights and interests. There is a need to improve the timeliness and effectiveness of the FS government-to-government consultations with Indian tribes.'' But currently, there is no program in the Forest Service to provide tribes with the financial assistance that tribes often need to respond to or actively participate in Forest Service activities regarding these issues. Such participation can involve not-insignificant expense, including such items as travel or the engagement of needed technical professionals. Many tribes lack the funds to meet such costs, especially tribes in more remote locations that are more likely to share boundaries with Forest Service land. Such a fund would enable the Forest Service to help the tribe take part in cooperative efforts with the Service. The amount for such a fund should recognize its national scope, and a means of distribution, perhaps by the Central Office, could be established in regulation through a negotiated rulemaking with tribal governments. A program to make tribal governments more capable of meaningfully participating in Forest Service actions affecting tribal interests is needed and justified. The Cooperative Forestry Assistance Act, in Section 11, authorizes funds directly to states to enhance state forest land management capacity; similar assistance should be made available to tribal governments, at least to participate in Forest Service related issues.
Page 85 PREV PAGE TOP OF DOC Why create programs to assist tribal efforts in conservation education, technical assistance, and acquisition of conservation interests?
We believe these three programs would enable tribal governments to perform several of the Coop Act's basic intentions for the benefit of our governmental land and the individually owned Indian land within our reservations, where these sorts of services are needed. We believe these programs will enable the tribes and the Forest Service to become more familiar with one another on a comparatively modest level, so that all parties can initially gauge how our new relationship is faring, and allow opportunity to easily make any necessary adjustments.
Program 2) Authorize a USFS program of assistance to tribal governments for conservation education and awareness programs within a tribe's reservation.
Much like other private forest landowners in the U.S., individual Indian forest landowners within reservations often have only limited understanding and appreciation of the management and conservation needs of their land, even when their land is held in trust by the Department of the Interior. Accordingly, there is a need for landowner education activities provided by the tribal government with the assistance of the Forest Service, similar to those programs operated by states with assistance from the USFS. As discussed earlier, tribal governments have principal authority for activities within their reservations, so it would be most appropriate - and more effective - for tribal governments to carry out this program for individual Indian land owners within the reservation.
Program 3) Authorize a USFS program of assistance to tribal governments for the provision of technical assistance to tribal and individual Indian land owners.
Tribal governments and their Forestry departments could certainly benefit from a cooperative relationship with the U.S. Forest Service, drawing upon the USFS research and technical expertise to improve the management of both tribal forest lands and, through active outreach, individual Indian forest lands within the reservation.
Page 86 PREV PAGE TOP OF DOC Program 4) Authorize a USFS program of assistance to tribal governments to secure conservation interests in individual Indian forest lands within the reservation.
Currently, to the best of our understanding, there is no Federal assistance available to tribal governments for their acquisition of conservation interests, such as easements, from willing individual land owners within the reservation. Yet tribal governments have at least as much, and probably more, reason as states or the Federal Government for seeking such long-term conservation projects. Our reservations are our permanent homelands. It is up to us to sustain our lands for all generations yet unborn. Our limited land base must provide for their physical, spiritual, and material well-being, so there is a particular need for active conservation. And individual land owners on reservations are not exempt from pressures to develop or exploit their land. So, a compelling need exists for such assistance to tribal governments.
Tribal governments have the principal responsibility for carrying out any long term conservation program within a reservation. Federal acquisition of such interests, as now provided for private lands in the Coop Act, is not well suited for land within reservations, because it is often the Federal Government as trustee that holds title to individual Indian lands. A tribal acquisition of a conservation interest in individual trust land would vest that interest in the tribe in trust, which is not only the most appropriate way, but perhaps the only way, such an interest can be achieved.
Mr. Chairman, we urge you to consider our recommendations in this testimony. Indian forest lands, both tribal and individual, are a significant part of the nation's forest land base. Given the permanency on our reservations, given the Federal Government's unique relationship and obligations to Indian tribes, and given our contribution to the national goal of conservation, we hope you will agree with the worthiness and equity of establishing a separate tribal section in the Cooperative Forestry Assistance Act. We also hope you will amend the Act to provide assistance to enable tribal governments to work more closely with the Forest Service on matters involving our interests.
Page 87 PREV PAGE TOP OF DOC We stand ready to work with you and the Subcommittee to incorporate these issues into the Farm Bill legislation now under consideration.
FORMULATION OF THE 2002 FARM BILL
WEDNESDAY, JUNE 27, 2001
House of Representatives,
Subcommittee on Department Operations,
Oversight, Nutrition and Forestry,
Committee on Agriculture,
The subcommittee met, pursuant to call, at 2:10 p.m., in room 1300, Longworth House Office Building, Hon. Bob Goodlatte (chairman of the subcommittee) presiding.
Present: Representatives Goodlatte, Moran, Cooksey, Rehberg, Clayton, Acevedo-Vilá, and Baldacci.
Staff present: Brent Gattis, subcommittee staff director; Lynn Gallagher, senior professional staff; Callista Gingrich, chief clerk; Jason Vaillancourt, Stephanie Myers, Susanna Love, and Walter Vinson.
STATEMENT OF HON. BOB GOODLATTE, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF VIRGINIA
Mr. GOODLATTE. Good afternoon. This hearing of the Subcommittee on Department Operations, Oversight, Nutrition and Forestry to review the Food Stamp Program will come to order. I have an opening statement that I would like to give, and then we will hear from the ranking Democrat, Mrs. Clayton.
Page 88 PREV PAGE TOP OF DOC The purpose of this hearing is to receive testimony regarding the Food Stamp Program. Today we will focus on several aspects of the program in order to receive a more broad and comprehensive picture as we move closer to writing a new farm bill. We will hear from witnesses concerning the implementation of the changes to the Food Stamp Program since the passage of the Personal Responsibility and Work Opportunity Act of 1996. In addition, we will hear testimony from witnesses concerning further changes to the Food Stamp Program, including recommendations to simplify the Food Stamp Program for families in need of assistance and for States administering the Food Stamp Program and other public assistance programs.
Also, the Food Stamp Act requires that each State implement an electronic benefit transfer (EBT) system no later than October one 2002. The subcommittee is interested in the status of implementation of EBT systems in the States and the effectiveness of the EBT systems. Participation in the Food Stamp Program, the Nation's largest assistance program, has dropped, according to a recent GAO study, by 33 percent during the last 4 1/2 years. The Welfare Reform Act that Congress passed in 1996 retained the Food Stamp Program as an entitlement program for qualifying participants but it tightened the program's eligibility standards by establishing work requirements for 18- to 50-year-old able-bodied adults without dependents and by disqualifying most noncitizens from participating in the program.
There are many theories to explain this dramatic drop and I suspect we will hear about most of them today. Most theories look to place blame or point fingers. I hesitate to be so negative. Some studies suggest that there is a growing gap between need and assistance. Let me make it clear, there is no argument that we should not have hunger in the world's richest country that has the world's safest, most wholesome, economical, and abundant food supply.
Another important issue before the subcommittee today is whether or not the States should be given more individual control over the administration of the Food Stamp Program. I fear that instead of giving the States greater flexibility in the program, there will be pressure to create a more command-and-control management style. Some States have proven they can be the innovators of welfare reform, as we will hear today. Their success in handling the administrative freedoms of the TANF program confirms my support for greater flexibility in the Food Stamp Program.
Page 89 PREV PAGE TOP OF DOC I look forward to working with the States and the U.S. Department of Agriculture to see what advances can be made. In addition, I hope to hear other perspectives about both the issues of caseload reduction and greater flexibility for the States in the Food Stamp Program today.
We have assembled a group of uniquely qualified witnesses, 17 in all I believe, that will testify before the subcommittee today about the many aspects of the Food Stamp Program, and I look forward to hearing all the witnesses' testimony. I hope their points of view will provide the subcommittee with increasing knowledge and guidance toward the shaping of future nutrition programs and policy.
And I would now like to recognize the ranking member of the subcommittee, Mrs. Clayton of North Carolina.
OPENING STATEMENT OF HON. EVA M. CLAYTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NORTH CAROLINA
Mrs. CLAYTON. Thank you, Mr. Chairman and thank you for holding this important hearing.
In his book, ''The Third Freedom'', George McGovern reflects on the shame he felt watching a 1968 CBS documentary, ''Hunger, USA.'' Senator McGovern remembers a young hungry boy solemnly watching as his classmates ate their school lunch. When the reporters asked the boy what he was thinking as he stood watching his classmate eat, the boy replied, I'm ashamed because I ain't got no money. Senator McGovern writes that it was he, the powerful Senator, who felt ashamed. ''I was ashamed because I hadn't known more about hunger in my own land. I was ashamed that a Federal program I was supposed to know all about permitted youngsters to go hungry even as they watched paying classmates eat before their eyes.''.
Page 90 PREV PAGE TOP OF DOC While churches and charities are essential to helping poor and hungry people, the Nation's first line of defense against hunger is the Federal Food Stamp Program. Each month over 17 million people receive food stamp assistance. More than half of the people served are children, with 80 percent of the benefits going to households with children.
Since 1996, Food Stamp Program participation has fallen by 8.8 million people. Some of this is due to the legislative changes and improvement in the economy. But much of the caseload reduction has occurred for other reasons. We must address this caseload reduction and ensure that food stamp works for working families.
By reauthorizing the Food Stamp Program as part of the farm bill, the Agriculture Committee will once again have an opportunity to demonstrate the close association of our agriculture producers with struggling working Americans. Historically, the Nutrition Title has been an important part of the larger farm bill, not only because it helps working Americans but also because it helps to garner sufficient support to pass the bill on the floor of the House of Representatives. It is crucial that the next farm bill reinforce this by providing a strong Nutrition Title that recognizes the critical role that the Food Stamp Program plays in the lives of people across America, from farmers in the fields in America's heartland to working mothers in small towns in North Carolina.
We must not kid ourselves, a strong Nutrition Title costs money. In fact there are a number of things that deserve our attention within the farm bill that will require resources. Conservation, research, rural development and APHIS among others are areas in which we will need to consider allocating new funds within the farm bill.
Given the devastating cuts that were forced upon the Food Stamp Program in 1996, cuts which had little to do with sound nutritional food security policy and more to do with a budget constraint, or by cutting the budget to reduce expenditures, a modest reinvestment in the Food Stamp Program is therefore certainly warranted.
Page 91 PREV PAGE TOP OF DOC In reading through testimony presented today, it is clear to me that I am not alone in this belief. Many of the recommendations offered here today by advocates, by the States, and by our own Department will surely cost money to implement, and I look forward to hearing from our witnesses. They are indeed many, but they are all distinguished and are leaders today, and they have devoted their resources and their time to this area.
The Food Stamp Program is a critical work support that enables many struggling working American families to enter and remain in the workforce. Many will argue that the Food Stamp Program is simply a welfare program that engenders dependency. I disagree strongly. In many cases a Food Stamp Program is often not what prevents someone from getting a job, but enables them to sustain their families when they are located in the low-wage sector of the economy, which many are. Coeli Brunty, a working mother of two who will testify here today, is a perfect example of how the Food Stamp Program supports our families and enables her.
I have recently introduced with Congressman Walsh the Nutritional Assistance for Seniors and Working Families Act of 2001, H.R. 2142. I am proud to say that we introduced this bill with eight Republicans and nine Democrats, showing once again that hunger transcends political boundaries.
My bill recognizes that the Food Stamp Program, as worthy and important as it is, still needs to be updated and reformed. However, we must be careful not to let reformist zeal, including my own, undercut our purpose of serving low-income Americans in a targeted and an effective way. This does not require of us a total overhaul of the Food Stamp Program. It does require of us to make the necessary changes. We already know what works in the program. We must also build upon that. Doing so will allow us to realign the Food Stamp Program so that it addresses the economic situation of low-income and working Americans.
I am pleased to have all the witnesses that are here, especially Representative Levin.
Page 92 PREV PAGE TOP OF DOC Mr. Chairman, in closing that I may ask unanimous consent to put into the record Congressman Walsh's statement. He was not able to come.
Mr. GOODLATTE. Without objection, it will be made a part of the record.
[The information appears at the conclusion of the hearing.]
Mrs. CLAYTON. And I thank you for allowing me to read my statement.
Mr. GOODLATTE. Thank you Mrs. Clayton.
We are now pleased to welcome our first witness, the Honorable Sander M. Levin, Member of Congress, from Royal Oak, Michigan. And, Congressman Levin, as you are well aware, we are very pleased to have your written testimony as an official part of the record and we would be happy to have your oral testimony at this time. Welcome.
STATEMENT OF HON. SANDER M. LEVIN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN
Mr. LEVIN. Thank you, Mr. Chairman and Mrs. Clayton. It is a real pleasure and privilege to be here and I appreciate you letting me take a few minutes. I did look over your list of witnesses, and I admire your fortitude. But looking over the list, I do think it will be a very enlightening hearing with some diverse points of view. Some of the people on your roster and I worked on the 1996 act. So let me just be very brief so that others, including the new Under Secretary, can take over.
Three or four points. Number one, as an individual Member of Congress, I would hope that a nutrition portion will be in any agricultural authorization bill.
It seems to me that otherwise, any agricultural bill will be insufficient, incomplete and, if I might say so, inappropriate.
Page 93 PREV PAGE TOP OF DOC Second, there may be some argument over the exact figures, but as you said in, Mr. Chairman, your opening statement, food insecurity and hunger remain prevalent in America, not dominant but prevalent. And I don't see how we can abide it. I went to a food pantry in the Detroit area some months ago and saw the demand for food, and it seemed to me that something was wrong.
A third point I would like to make relates to the interchange between welfare reform and nutrition and the Food Stamp Program. And I want to spend just a couple of minutes on that, and then I am in no hurry, but you have so many witnesses, I will leave.
When welfare reform was debated and discussed, there were a number of critical issues. I felt, I think with the clear majority of this Congress, that we should reform welfare; that we had to have a much more vibrant nexus between welfare and work; that we needed to rearrange the program with a much greater emphasis on work. We argued over not that principle, we argued over issues like health care and child care, and eventually boosted those elements dramatically in the bill that was ultimately signed and that I supported.
But there were several serious flaws in the bill. One related to the provisions for legal immigrants, primarily SSI and food stamps. And the other related to food stamps more generally. As Mrs. Clayton has said, there were very, very substantial cuts in both programs, $50 to $60 billion, and with few exceptions they were unrelated to the gist of welfare reform. Legal immigrants were in small numbers receiving ADC and, in relatively small numbers, food stamps.
Anyway, those cuts were made and a number of us pledged to ourselves that we would move to rectify those flaws, and we did so in substantial measure relating to legal immigrants and SSI. But there remain, I think, in terms of welfare reform some very major outstanding questions as to food stamps, and it goes beyond those who are receiving TANF, but it includes them.
Page 94 PREV PAGE TOP OF DOC And so let me just say a few words about how I see it. People have moved from welfare to work. Food stamp use has gone down. Why is it? Part of it is the economy. But also part of it is that substantial numbers, tens of thousands, really hundreds of thousands have gone to work, receiving about $7 an hourwe don't have the complete dataand don't have enough with their work, with their wages to provide adequate food for their children. In my judgment, we need to change that.
A few years ago we looked into it. Part of the reason was the majority who were not receiving or obtaining food stamps, who were eligible, who were on TANF, did not realize that they were eligible or found the hoops too many to jump through. And so we provided, all of us working together, many of us, some moneys for there to be some outreach programs.
Let me urge as you look at this, as you will in a very diligent way, to ask yourself the question, as people move from welfare to work, whether the inability to provide adequate food is a stimulus for dependence or independence. And I would urge that having hungry kids in a home, or a hungry mother, doesn't spur people to more independence but diminishes the chance, as they much as they want, that they will work themselves up the ladder and out of poverty.
So one of the elements of this program I think that has to be looked at is what is wrong with it; why are not more people who are moving up the ladder utilizing their eligibility? And so I would hope in addition to the overall needs of the Food Stamp Programand they are very substantialthat you will look at this issue. In my judgment, a further step towards welfare reform in a real sense, moving people out of poverty, is making sure that work is not combined with hunger.
Thank you very much.
Mr. GOODLATTE. Thank you, Congressman Levin. We very much appreciate your testimony and we know how heartfelt that it is, and we will certainly be hearing more about that from the 16 witnesses to follow you.
Page 95 PREV PAGE TOP OF DOC Mr. LEVIN. Thank you very much.
Mr. GOODLATTE. Thank you. We would now like to invite the second panel to the table, a repeat visitor. We are going to do this every week Mr. Bost. The Honorable Eric M. Bost, Under Secretary, Food, Nutrition, and Consumer Services, United States Department of Agriculture, Washington, DC. Again we welcome you and remind you that your written statement will be made a part of the record.
STATEMENT OF ERIC M. BOST, UNDER SECRETARY, FOOD, NUTRITION, AND CONSUMER SERVICES, U.S. DEPARTMENT OF AGRICULTURE
Mr. BOST. Thank you, Mr. Chairman, Mrs. Clayton. It is indeed a pleasure to be here with you again and to see you again. And I appreciate the opportunity to join you today to discuss the reauthorization of the Food Stamp Program to build on its history of success to meet the demands of a new century.
Nearly 4 years ago, then-Governor George W. Bush appointed me commissioner of the Texas Department of Human Services, one of the Nation's largest human services agencies, an organization with more than 15,000 employees and an annual budget of over $3.5 billion.
I was responsible for administering State and Federal programs and served more than 2 million needy, aged, or disabled Texans each month. I assumed that position after more than 20 years of experience in managing human services agencies across the country.
When the President and Secretary Veneman asked me to join the team at the Department of Agriculture, I was extremely pleased to have the opportunity to put my expertise at the State and local levels to work in managing and improving the Federal nutrition assistance programs. I particularly looked forward to representing the administration in the process of reauthorizing the Food Stamp Program, the foundation of the Nation's nutrition safety net, as part of the farm bill. I believe that my knowledge and experience prepared me well for this challenge.
Page 96 PREV PAGE TOP OF DOC I look forward to working with the subcommittee as we develop a reauthorization approach that both preserves those aspects of the program that has served this country so well over the past decades and makes changes needed for the program to function more effectively and efficiently into the future.
I would first like to begin today with just a brief review of the Food Stamp Program's current status, then describe some of the changes in the program's performance and operations in the context of welfare reform, and then kind of outline some of my thoughts about the aspects of the program that could be improved through reauthorization.
For over 30 years the Food Stamp Program has served as a first line of the Nation's defense against hunger, a powerful tool to improve nutrition among low-income people. Any discussion of Food Stamp reauthorization must start with the recognition of the strong evidence that the Food Stamp Program works to reduce hunger and improve nutrition in our country.
It touches the lives of millions of people who need a helping hand to put food on the table. Unlike most other States' TANF programs, the Food Stamp Program is available to nearly anyone with little income and few resources, serving low-income families and individuals wherever they live with food-based benefits that increase a household's food expenditures and its access to nutrition foods.
Because food stamps are not targeted or restricted by age, disability status, or family structure, recipients are a diverse group, representing a broad cross-section of the Nation's poor.
In 1999, over half of all food stamp recipients, about 51 percent, were children; 9 percent were elderly; and another 9 percent were disabled. Many recipients worked, and the majority of food stamp households were not on Temporary Assistance to Needy Families. However, low food stamp households have little income and few resources available to them. Only 11 percent were above the poverty line, while 35 percent had incomes that were less than half of the poverty line. About two-thirds of all households had no countable assets. The program is clearly successful at targeting benefits to our neediest fellow citizens.
Page 97 PREV PAGE TOP OF DOC The program responds to economic changes, expanding to meet increased needs when the economy is in recession, and contracting when the economy is growing, making sure that food gets to people who need it. And it is something that I am really pleased with in terms of this program.
In March of this year, the program served 17.3 million people, down from 28 million at its peak in March 1994, and in recent months the participation has slowed and may have ended. I think that we are going to hear from people today in terms of whether they believe that is accurate or not. Over half of all States are now serving more people than they did a year ago. It is important to note that as participation has declined, program costs have also dropped considerably. Annual costs have declined by over $7 billion since fiscal year 1995.
The program delivers billions of dollars in benefits, with a high degree of integrity and accountability. The vast majority of program benefits go only to the households that need them. In 2000, about 6.5 percent of the program benefits were issued in excess of the correct amount. An additional 2.4 percent of program benefits should have been issued to recipients but were not actually issued. The combined overall payment error rateI like to call it accuracy rateof 8.9 percent represents the lowest rate of overall error in the program's history. I believe that we are doing well, but further improvement can be made.
In 2000, 98 percent of the households that received food stamps were entitled to some benefit. Problems tend to occur far more frequently in cases where an eligible household is provided with the wrong amount of benefits. Difficulties in determining the correct level of benefits stems from a number of factors: the intricacy of the program rules designed to target benefits precisely; error rate or the accuracy rate; the complex circumstances of working families; and the need to anticipate the circumstances of program participants. And here again I am sure that we are going to hear about that from several other witnesses today.
When errors resulting in overpayments do occur, the Department works very hard to recoup those funds from those who receive them in partnership with the States. There are a variety of tools that have supported this effort such as recoupment from active benefits, voluntary repayments, referrals to collection agencies, and offsets of State and Federal payments. In fiscal year 2000, $223.8 million was collected through these mechanisms. By far, of course, the most successful tool is the Federal offset program.
Page 98 PREV PAGE TOP OF DOC The period since the program was last reauthorized has seen a revolution in the way that food stamp benefits are delivered. In 1996, Congress set a deadline to have all food stamp benefits delivered through electronic benefit transfer, or EBT, by October 1 of 2002. At that time, only 15 percent of the benefits were delivered electronically. Today, over 80 percent of all benefits are delivered through EBT. Forty-three agencies now operate EBT systems for the Food Stamp Program and 41 EBT systems operate statewide. And, Mr. Chairman, I am happy to report that it appears that your home State of Virginia is going to meet the deadline.
One of the benefits of the move to EBT is that it provides new tools in the fight against food stamp trafficking. Electronic transaction data are systematically analyzed and used to identify violations and we continue to refine the use of that data. While the extent of trafficking food stamps for cash is estimated to be less than 4 cents of every dollar issued, we must continue to be vigilant not just to improve our ability to address trafficking and other kinds of fraud, but to ensure that only eligible stores participate in the program.
And this is so important to me personally because it ensures effective stewardship of taxpayer investment in the program, and it is one of the most important responsibilities that I believe that we have. I know that you will hear from the Inspector General later, and I look forward to working with him closely to see what other things we can do to maintain a high level of integrity in these programs.
As I have mentioned, much has changed since Congress last reauthorized the Food Stamp Program. Increasing food security, ending hunger and improving nutrition among low-income families and individuals remains central to the program's mission, yet the challenges facing the program today and the pace of change in the world in which we operate are indeed substantial.
Welfare reform transforms social policy for low-income families, replacing an entitlement to cash assistance with a system that requires work in exchange for time-limited benefits. Between January 1996 and June 2000, the welfare caseload in our country fell by over 50 percent, the largest welfare caseload decline in history and the lowest percentage of population on welfare since 1965.
Page 99 PREV PAGE TOP OF DOC In important ways, States have been leaders in this revolutionary effort and are responsible for much of its success. State Governments made use of the flexibility provided in the 1996 law to develop innovative efforts to restructure their welfare programs to require work, time-limited assistance, improve child support enforcement, or encourage parental responsibility. But I also believe that the Food Stamp Program contributed to a little bit of the success of the welfare reform by supporting the transition from welfare to work. The reasons are easy to understand. If you are worried about your family's next meal, it is hard, so very hard, to focus on your future.
As I said, as I mentioned earlier, the Food Stamp Program served 17.3 million people in March 2000, nearly 11 million fewer than at its peak in March 1994. Part of the decline is explained by a strong economy, the success of welfare reform in moving people into jobs, and the restrictions on legal immigrants and unemployed adults.
But other factors may also be at work. The percentage of people eligible for food stamps who actually participated fell 11 points between 1994 and 1998. In 1998, about 59 percent of those eligible for benefits received them, roughly the same level as in the late 1980's. Working poor families and elderly people continue to participate at rates well below the national average.
Concerns have grown that the program's administrative burden and complexity are hampering its performance in the post-welfare reform environment. There is growing recognition that the complexity of program requirements, often the result of the desire to target benefits more precisely, may cause errors and deter participation among people eligible for benefits. For example, households are required to provide detailed documentation of expenses for shelter, dependent care, medical expenses and child support. Similarly, the law requires that most unemployed adults without children should only receive food stamps for a limited time, and most legal immigrants should not receive food stamps at all.
Page 100 PREV PAGE TOP OF DOC These policies have a great deal of merit; however, provisions of this kind require applicants to provide additional information, introduce new rules for case workers to follow, and impose costly and potentially error-prone tracking requirements on State agencies.
These burdens are particularly significant for working families that comprise an increasing portion of the food stamp caseload. Case workers are often expected to anticipate changes in their income and expenses, a difficult and error-prone task, especially for working poor households whose incomes fluctuate, and households are expected to report changes in their circumstances to ensure that each month's benefits reflect their current need. Such burdensome requirements may discourage working families from participating in the program. They also make the job of State agencies exceptionally difficult.
Finally, there is a growing awareness that we need to reform the quality control system to ensure that it more effectively encourages payment accuracy without discouraging States from achieving other important program objectives. The existing quality control system provides timely and accurate data on States' performance in issuing the correct amount of benefits as well as other valuable program information. Establishing sanctions against any State with a higher than average error rate is a source of serious and continuing friction with States. Sanctioning approximately half of the States each year does not contribute effectively to produce partnerships that can achieve the program's objectives. In addition, there is a growing concern that the system discourages States from achieving other desired program outcomes such as program access.
My view, and this is probably one of the most important things that I am going to say today, my view is that every person eligible for benefits should receive the full benefits. However, our commitment is to ensure that we maintain a high level of integrity in our programs. We need to reexamine how the Food Stamp Programs recognizes and supports these multiple goals.
Page 101 PREV PAGE TOP OF DOC Mr. GOODLATTE. Mr. Bost I noticed your testimony is about 12 pages long and I don't think you can get it in in time. You are well over. I wonder if you could summarize and we will try to hit the other points in the questions.
Mr. BOST. There are three points let's talk about in terms of reauthorization:
One, supporting work. Food stamps can serve as a critical support for the transition to work and self-sufficiency.
Two, simplifying program rules. There is a broad agreement that the program has grown too complicated.
And maintaining the nutrition safety net. I believe this is also very important for this program.
And last but not least, something they talked about, improving accountability. We have to be good stewards of taxpayer dollars, and this is really important as we move toward reauthorization.
So those are the three points that I wanted to share with you.
[The prepared statement of Mr. Bost appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you very much, and as I indicated, the full testimony will be a part of the record and it will definitely be reviewed by us.
Let me ask you a couple of questions. First of all, when you were commissioner of the Texas Department of Human Services, would you have preferred to have the same rules for food stamp and TANF Programs, and is your view shared by other commissioners around the country?
Mr. BOST. Mr. Chairman, I think I would essentially say we need greater flexibility when it comes to implementing the Food Stamp Program. I don't know if the rules need to be exactly alike, but I think that they would say and I would say, having been a commissioner of one of the largest States in the country, greater flexibility when it comes to implementing the program. I think, as I said before in my testimony, the intentions of the Food Stamp Program in terms of all of the rules that were there, I think the intent was positive. But when you have layer on layer on layer on layer of rules to implement, and as a caseworker trying to hit that target exactly head on, it is exceptionally difficult to do. And as a result, I think that that in turn causes errors, and not necessarily well-intentioned, but the end result is that it is errors. The Federal Government reviews it and they in turn sanction the States, so it is a cycle that goes round and round, and in many instances, in my opinion, there are folks who have believed it has contributed to why people don't want to come to apply even if they are indeed eligible.
Page 102 PREV PAGE TOP OF DOC Mr. GOODLATTE. We have heard a lot about access to the Food Stamp Program, and the USDA and some of the States have been criticized for not doing enough about access during your tenure. As commissioner of the Department of Resources in Texas, what did you do with respect to access to the Food Stamp Program; and now in your new position, what is your perspective on the Department's efforts with regard to access?
Mr. BOST. I am really happy that you asked me that question, because I am sure that we are going to hear from several other witnesses about this particular issue. In terms of Texas, I took a three-pronged approach and then brought it all together. First and foremost, I had some forums around the State where I met with our staff to talk about what they perceived to be the issues in the administration of this program. Then I had several meetings along with our USDA partners from the southwest region to actually go out and talk to clients about what is wrong with the program; why don't you come in to apply; do you know other people you feel that might be eligible that don't come in? And then I brought together a working group made up of clients along with staff and advocates to look at redoing our application. In many instances, one of the criticisms was it was too difficult; it wasn't user friendly.
In Texas now, we have a four-page front-and-back application that is easier to use. And I also extended the office hours at 88 of our offices so that people that were working were able to come in and apply for benefits without having to take off time from work.
In addition to that, we did a significant amount of outreach. We contacted more than 80,000 organizations, distributed over 700,000 posters and flyers, distributed over 110,000 applications. I sent letters to all of the major daily newspapers in Texas to essentially say the message from me was the same. If there are people that think they are eligible to apply for food stamps, come into the offices then to apply. If you have large groups of people that come into the shelters or food banks, I will actually send the staff out and take the application there.
Page 103 PREV PAGE TOP OF DOC One of the things we did in partnership with our Federal partners at that timeand I know that there are, I think, 14 grants around the countryis having grants with community-based organizations so that they can do outreach. And I think that is one of the things I would like for us to continue to do, along with some performance measures for those organizations.
And one of the things that I did in terms of establishing the initiatives that I put in place in Texas that I feel we would be able to do here is two thingsand I know that the last administration did a little bit of thiswas, one, talk to clients to see what they have to say, because they are going to, they have to, if they come in and want to get access to services. And also the States are doing some innovative and creative things around the country. Let's talk to them to see what we are doing, so that we can share that, so we don't have to reinvent the wheel if we don't have to.
And so when we put all of those initiatives into place, we saw an increase in terms of the number of people that were eligible for services that actually came into our offices.
Mr. GOODLATTE. One of the offices that uses the waivers that has been noted repeatedly is the USDA's Cost Neutrality Policy. Does the Department intend to change that policy?
Mr. BOST. Mr. Chairman, I wanted to make sure that I understood your question. I don't know the answer to your question at this point. It is something that has been brought to my attention, and it is something that I am looking at this point, so I don't have an answer to your question. After I have an opportunity to review and get additional information, I think that I will be in a better position to answer your question.
Mr. GOODLATTE. Very good. If you would submit an answer in writing, that would be perfectly fine. At this time, I am pleased to recognize the gentlewoman from North Carolina.
Page 104 PREV PAGE TOP OF DOC Mrs. CLAYTON. I appreciate your testimony. I also appreciate hearing that you wanted to say that every poor family eligible to receive food stamps receive food stamps, but you also wanted to protect the integrity of the program. So that is a welcome mission to hear.
The agencies, USDA agencies have given States options to have certain flexibility. Are you aware if States are using them and have you reviewedI know you have been there just a week, a little better.
Mr. BOST. Yes, Mrs. Clayton, I have been busy.
Mrs. CLAYTON. I know. But have you had an opportunity to know how many States have requests, and if you plan to expand, give them options so they can have further outreach in the programthe State options?
Mr. BOST. Well, I think that I have seen some of the things that the States are doing, representative Clayton, and in terms of being able to answer your question in regard to affording the States additional options
Mrs. CLAYTON. Even of the options that are present, is there any effort to promote those?
Mr. BOST. Well, absolutely. I am always interested in ensuring that we provide States with opportunities to be much more creative and innovative on the receiving end of that in the State. One of the issues that I hope to address in my position now is that when States make those requests to the Federal Government, it takes such a long time to get any feedback or to get approval to do it, and so one of the things that I would hope that I would be able to do is to, of course, respond in a much more timely fashion.
One of the other considerations in terms of being able to accurately answer the question is the fact that with food stamps coming up for reauthorization so quickly I don't knowa great deal would depend on what the request is, because it might be one of the things that we are talking about as part of reauthorization in terms of allowing States being innovative and creative.
Page 105 PREV PAGE TOP OF DOC Mrs. CLAYTON. In other words, some of the options you would be recommending
Mr. BOST. Absolutely.
Mrs. CLAYTON. I got you. The Chair had referenced a TANF application process. I want to reference another one. And that is what we call the Medicaid Children Health Insurance Program, which has a very effective outreach and apparently a more simplified method of determining eligibility and getting people enrolled. And I know most States, in quick order, a lot of people indeed were registered. Is there any reason to suggest that USDA couldn't have a similar model?
Mr. BOST. Well, let me respond to your question by essentially saying that in Texas when I made reference to that application, the application that is four pages, front and back, that is in English and in Spanish, includes food stamps, TANF and Medicaid.
Mrs. CLAYTON. So the same information was used for all.
Mr. BOST. Well, it depends on what the person is coming in to apply for. The caseworkeressentially if the person is eligible for food stamps, they take the information for food stamps. If they are eligible for TANF and/or Medicaid, then they do it all at one time, and it is on that application. And we found that to be very user friendly and customer friendly and effective utilization of the caseworker's time, because we all kind of hit it all at one time.
And so I think there are some opportunities for us to look at doing that in other States, because some States, of course, have been very, very successful in terms of their outreach of enrolling children into CHIP. Other States have not been so successful. But I think there are opportunities for States to explore what we did in Texas in terms of just kind of making it one application.
Page 106 PREV PAGE TOP OF DOC Mrs. CLAYTON. In your previous role, were you responsible for the CHIP program as well as for food stamps?
Mr. BOST. Well, interestingly enough, we were responsible initially for determining the eligibility. But then the legislature made some decisions that they were going to turn it over to a private entity, and they were not as successful initially as they, the legislature, thought they should be. And so then the appropriations Chairs came to me and said. We want you to help out and get it off the ground and up and running.
Mrs. CLAYTON. So you got an opportunity to clean it up; is that what it is?
Mr. BOST. Representative Clayton, those were your words, not mine.
Mrs. CLAYTON. All right. My final question is the whole issue of nutrition education, not to suggest only poor nutrition education. All of us need good nutrition education. But that is a component of the Food Stamp Program. Can you comment on the quality of control of that and to what extent that is being enforced around the States?
Mr. BOST. From what I have been able to determine in the very short period of time that I have been here, we need to devote more time and energy in terms of being more effective in sharing that information and following through on it around the country. It is one of those instances, as you said, that all of us, adults and children as well, we could do a much better job in terms of talking about those things that are of nutritional value. The only problem is that ifand I have a real sweet tooth and I know what is good for me, but I have no desire of eating that. So the issue is both of education but also is the issue of changing the behavior of several of us, and it starts with adults because children follow our lead.
Mrs. CLAYTON. Right. Thank you, Mr. Chairman.
Page 107 PREV PAGE TOP OF DOC Mr. GOODLATTE. Thank you. The gentleman from Maine, Mr. Baldacci.
Mr. BALDACCI. Thank you, Mr. Chairman. Mr. Bost, nice to see you again.
Mr. BOST. Good to see you, sir.
Mr. BALDACCI. I appreciate the chairman's focus on these issues. I think the points that we talked about at the last hearing probably hold true today. Your testimony focused on the kind of criteria you would like in the reauthorization of the Food Stamp Program, and knowing you are just beginning down the road of dealing with these issue at the Federal level, I appreciate you articulating some of the criteria that you would be trying to use as a road map.
I think that we can agree on the flexibility. We can agree on the accountability, and add supporting work as we try to get the people who are still remaining on assistance to make sure that they have the tools to be able to use to continue to try to get the training and education and increase their own self-sufficiency.
Again, Mr. Chairman, I look forward to working with you and, in a bipartisan way, to address this reauthorization act.
We did talk about the Senior Nutrition Program. We talked about the WIC Program. I think that we need to increase the flexibility of the WIC voucher program so it can be better utilized as a program similar to the Senior Voucher Program which has been very successfully dealt with. I wouldn't ask you to comment on it. I don't know if you have any prepared comments on it. But the other issue that I want you to think about, I guess, is the fact that a lot of our nutrition education is not as effective as it needs to be, and I think that if people had the opportunity at better nutrition education, we could do a better job of making sure that they got the more effective use of the food stocks.
Page 108 PREV PAGE TOP OF DOC My wife was a dietitian with the WIC Program and it always kind of frustrated her that people were always buying prepared foods and they lacked the basic education in terms of being able to take flour and sugar and yeast and being able to be able to do that. And I think we have gotten away from a lot of the home economics and the kind of basic food courses that would be very helpful to people to utilize and would also be less costly.
So I just share with you that, and hopefully we can at least try to do something to address that.
Mr. BOST. Congressman, we are going to try very hard. We are not just going to try, but it is a major challenge for us. And the most recent statistics that I have seen indicate that over 50 percent of all of the Americans are overweight and that we eat the wrong things. We are probably one of the most educated groups of people in the entire world, and so it goes beyond providing information.
It also, as I said, is a change of behavior on our parts. We are going to look at putting together a campaign that hopefully does two things. One, as you said, provide information and education and educating people about the nutritional value and the importance of eating correctly or right. But it also has to result in a change in our behavior in terms of what we eat.
And let me give you a real specific example of what I am talking about, because I saw this the other day as I was driving through town. Somewhere I passed by a 7-Eleven and it had this big sign up. And it said, super, super-duper size drink, like 64 ounces of Coca-Cola or whatever it is, and I was just amazed.
I don't even think the cars have cup holders that big now. So it is a question of being able to educate us about, is that appropriate for us to have; and if you look at the super-sizing of meals and the fat content that they have, like I say, thatthe issue is that in manysome of us, of course, we know what to do, be it a question of the behavioral changes that are going to have to take place; and my commitment to you today is that I have already had some conversations with my staff about what we can do, what we should do, and what we can do better in terms of addressing those issues. And if you have suggestions, I would really like to have the opportunity to sit down with you and to listen to any suggestions or recommendations that you might want to share with me, to help us address these issues, because it is indeed very, very serious.
Page 109 PREV PAGE TOP OF DOC And one final point. I see the little red light flashing for me, but one last point.
This issue of eating the right thing contributes to so many other issues. I think there was an article in the paper today; because we are overweight as Americans, then that contributes to diabetes, and the diabetes makes us all ill and sick, and that, in turn, raises medical insurance costs. So there is a relationship.
And so this is a very, very important issue for us, and my commitment today is that we are going to try to do some things that are going to be innovative and creative and proactive in terms of addressing.
Mr. BALDACCI. Mr. Chairman, if I may, just to close and say, look, I appreciate that very, very much. Three out of four of the leading diseases in Maine are preventable diseases; and you are exactly right, they are tied to health care, health care costs, and all of that will impact.
The other thing is that I don't have the magic answer either, but I do know working with the chairman and working together in discussions and focusing on the issues, that at least we are going to put a good attempt forward. So I look forward to working with you and the chairman and the other members.
Mr. BOST. Thank you.
Mr. GOODLATTE. I thank the gentleman and I thank the under secretary as well.
To follow up on the one question that you wanted to get back to us about, the Clinton administration required that all State waiver requests must be cost-neutral. That was not required by law and prevents States from trying new and innovative methods. And so we would ask that you review that policy and advise the subcommittee whether you will make attempts to change that policy.
Page 110 PREV PAGE TOP OF DOC Mr. BOST. Absolutely, Mr. Chairman. We will be getting back with you very soon.
Mr. GOODLATTE. I appreciate your participation today.
Mr. BOST. Thank you very much.
Mr. GOODLATTE. And it is a little bit briefer than we were last time.
Mr. BOST. That is OK.
Mr. GOODLATTE. And we still have 15 witnesses to go, I think.
Mr. BOST. That is OK. Thank you very much.
Mr. GOODLATTE. Thank you again.
I would like to invite the third panel to the table: Mr. Robert E. Robertson, Director, Education, Workforce and Income Security Issues of the General Accounting Office here in Washington; along with the Honorable Roger C. Viadero, Inspector General, Office of the Inspector General, U.S. Department of Agriculture.
Gentlemen, we are pleased to have you with us today, and in light of the slow progress we have made so far, 1 hour for two witnesses, we are going to have to enforce from here on out a strict adherence to the 5-minute rule. We assure you, your entire statement will be made a part of the record. Please limit your comments to 5 minutes, and don't be surprised if I chime in when the 5 minutes expire.
Mr. Robertson, you can proceed first. Thank you. Welcome.
STATEMENT OF ROBERT E. ROBERTSON, DIRECTOR, EDUCATION, WORKFORCE AND INCOME SECURITY ISSUES, GENERAL ACCOUNTING OFFICE
Page 111 PREV PAGE TOP OF DOC
Mr. ROBERTSON. Thank you, Mr. Chairman, Mr. Baldacci. And I will be quick; I will be within the 5 minutes.
The information I am going to present today is based on our past work that is related to two fundamental challenges that the Food Stamp Program faces now and will continue to face in future years. The first of these challenges is ensuring the integrity of the program. The second is minimizing program barriers that might impede eligible individuals from participating.
Concerning the former, I, as well as others from GAO, have appeared before this subcommittee over the past few years to discuss how to best protect the financial integrity of this $15 billion program. And our most recent report, we examined what FNS and States were doing to reduce payment error rates, which by the way, Mr. Chairman, stand at about 9 percent of total program payments.
We reported that FNS primarily relied on three approaches. First, it used the results of its quality control system to implement a system of sanctions and incentives to encourage States to reduce their benefit payment error rates. Second, FNS has reduced the opportunity for payment errors by allowing the States to reduce reporting requirements for certain recipients. And, finally, FNS has promoted the exchange of information among States about potentially successful initiatives for improving payment accuracy.
The 28 States that we contacted during this review had also taken actions to reduce payment errors in recent years. The most common were using supervisory reviews for verifying the accuracy of benefit payments calculated by State food stamp workers, providing specialized training for State food stamp workers, analyzing quality control data to identify causes of common payment errors; and last but not least, matching food stamp roles with other Federal and State computer databases to identify ineligible participants or verify income and asset information provided by food stamp recipients.
Page 112 PREV PAGE TOP OF DOC Now, if you were to ask the States for their view of the one action that could offer the greatest potential for additional reductions in payment errors, they would answer in a very uniform and strong voice. Simplify the complex rules for determining program eligibility and benefit payments, and that is a theme that you are going to be hearing me refer to several times during this summary.
In addition to potentially reducing the error rates and administrative costs, simplifying the rules may also help improve participation by, among other things, reducing perceived or real administrative burdens associated with obtaining food stamps. And now this is a perfect segue into a suggestion for the second of the two key challenges facing the Food Stamp Program that I mentioned earlier, that of program participation.
FNS estimates that about 59 percent of the eligible people participated in the program in 1998, and that is down from 71 percent in 1994, as the Under Secretary mentioned earlier. Possibly of even greater concern is information showing that children's participation in the Food Stamp Program has dropped more sharply than the number of children living in poverty, indicating a growing gap between need and assistance.
There are many possible reasons for the decline in overall food stamp participation, as well as a decline in the percentage of eligibles who are participating in the program. For example, in 1999, we reported a strong economy, tighter eligibility standards and State and local initiatives designed to reduce TANF caseloads contribute to these trends. Since our report, FNS has taken steps to ensure that eligible people receive food stamp benefits. However, it is too early to tell how effective these actions will be.
In conclusion, Mr. Chairman, my key message today is that simplifying the Food Stamp Program's rules and regulations appears to offer an opportunity to help address challenges related to both program integrity and participation.
FNS has begun to look at options for simplifying requirements for determining benefits. However, in view of the upcoming reauthorization, it is critical that FNS follow through with this process to be successful. The process must include a continuing dialogue with all appropriate stakeholders, including congressional Members and State officials, and should be aimed at ensuring that actions are taken to streamline the program, while at the same time improving program integrity.
Page 113 PREV PAGE TOP OF DOC That, sir, finishes my summary statement, and I will be happy to answer any questions you may have.
[The prepared statement of Mr. Robertson appears at the conclusion of the hearing.]
Mr. GOODLATTE. And you were right in under the wire. Thank you very much.
Mr. Viadero, we have had you with us many times, and we are pleased to have you back again today
STATEMENT OF ROGER C. VIADERO, INSPECTOR GENERAL, OFFICE OF THE INSPECTOR GENERAL, U.S. DEPARTMENT OF AGRICULTURE, ACCOMPANIED BY GREGORY S. SEYBOLD, ASSISTANT INSPECTOR GENERAL FOR INVESTIGATIONS, AND RICHARD D. LONG, ASSISTANT INSPECTOR GENERAL, AUDIT
Mr. VIADERO. Well, thank you, Mr. Chairman. I hope I can do as well as my colleague here from GAO on the time. I would like I saywhoops. Thank you.
I would like to say good afternoon to you, Mr. Chairman, and all members of the committee. We appreciate the opportunity to testify about the changes in the Food Stamp Program since the passage of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, generally known as welfare reform, and the status and effectiveness of implementing Electronic Benefits Transfer, or EBT, systems in States to issue food stamp benefits.
With me today are Gregory S. Seybold, Assistant Inspector General for Investigations; and Richard D. Long, who was recently appointed as Assistant Inspector General for Audit. Let us start with Operation Talon. The welfare reform act declared individuals ineligible to receive food stamp benefits, who are fleeing to avoid prosecution, custody or confinement after conviction. At this time, it authorizes State agencies to provide the addresses of food stamp recipients to any Federal, State or local law enforcement officer for official purposes.
Page 114 PREV PAGE TOP OF DOC Capitalizing on this, my organization began the law enforcement initiative known as Operation Talon. In conjunction with State and local law enforcement agencies across the country, we located and apprehended fugitives, who may also be illegally receiving food stamp benefits.
Since its inception in early 1997, Operation Talon has resulted in 7,481 arrests. Serious crimes perpetrated by those arrested include homicide-related offenses, sex offenses, kidnapping, abduction, assault, robbery and drugs and other narcotic violations. Exhibit A to my written statement contains a chart depicting by State the number of arrests and related crimes.
EBT implementation: The Welfare Reform Act provides that all States must issue food stamp benefits using an EBT system by October 1, 2002. Currently, 42 States and the District of Columbia has operational EBT systems issuing food stamp benefits. Thirty-nine of the States and the District of Columbia issue all food stamp benefits by EBT.
Exhibit B of my written statement presents the status of EBT systems in each of the 50 States and the District of Columbia. The Food and Nutrition Service, or FNS, estimates that EBT systems now issue about 80 percent of food stamp benefits. While the number of States with operational, statewide systems is impressive, some States with significant case loads are not yet operational.
For example, California: Only San Bernadino and San Diego Counties have operational EBT systems, yet California accounts for $1.6 billion of the $15.1 billion in food stamp benefits issued in fiscal year 2000. California has selected a contractor for statewide implementation, but as an example, Alameda County will not roll out a pilot until August 2002, and Los Angeles County will not until January 2003. At this point, it would not appear that California will meet the October 2002 deadline.
Indiana, with fiscal year 2000 issuances of about 271 million, has just started its pilot.
Page 115 PREV PAGE TOP OF DOC And Mississippi, with issuances of $226 million in fiscal 2000, has selected a vendor, but the contract has not yet been approved.
My office's audit efforts are quite long and rather extensive. OIG has taken an active roll in monitoring and reviewing EBT systems. We view our role as providing assurances to program managers that the systems are functioning as intended, are reporting problems that need to be addressed so the systems operate properly.
OIG has reviewed systems in 23 States, concentrating on those that have large case loads. Overall, our work has shown that EBT systems are working. However, some issues need to be addressed to strengthen the controls.
In January 2001, we reported the following obligations at fiscal year-end were not accurately reflected by FNS's accounting systems because of flawed methodology on expunged benefits. States did not always report the proper amount of expunged benefits. We identified more than 180 individuals in seven States whose access to the State system should have been removed because their job duties changed.
EBT makes fraud identification much, much easier. It actually takes the fraud off the street and puts it in the store where it belongs. EBT systems provide an electronic record of transactions and have made it much easier to identify where the trafficking is ongoing.
As a result of EBT, more than 9,000 recipients have been removed from the program. For fiscal year 1996 to the present, we estimate that losses to the government resulting from EBT are approximately $49 million. We have concluded 386 EBT-related investigations, and they yielded 431 indictments, 354 convictions and $18 million.
The system, quite honestly, works. And, Mr. Chairman, I am happy to say this concludes my statement, and we would be happy to answer any questions you or the members may have.
[The prepared statement of Mr. Viadero appears at the conclusion of the hearing.]
Page 116 PREV PAGE TOP OF DOC Mr. GOODLATTE. Thank you very much, Mr. Viadero.
Mr. Robertson, in your testimony, you state that simplifying food stamp rules offers an opportunity to reduce payment errors. What are the predominant errors in the Food Stamp Program over the last 5 years, and how would simplified policies reduce those errors?
Mr. ROBERTSON. Well, basically, the errors over the last 3 years, if you look at them, fall out roughly 50 percent, a little bit over our errors that are on the part of the caseworkers; and the other 50 percent, a little less, are errors caused by misinformation, either intentionally or unintentionally, given by the recipients of the program.
The simplification would help program integrity basically bylet me back up a little bit.
The rules and regulations governing eligibility and governing benefit payment now are so complex that they basically beg you to make an error, and by simplifying these rules and relations, what you do is, you take some of the complexity out of that, you take some of the potential for errors out of that. Plus you would probably reduce administrative costs and decrease the difficulty in administering the program.
Mr. GOODLATTE. And related to that, some States want to abandon the current food stamp quality control system. What is your view of that proposal?
Mr. ROBERTSON. First of all, I think we need a quality control system. I think we need a system of sanctions and enhancement. I am not sure that the system that we have in place is absolutely the right way to go from the standpoint of using a national average to sanction States that don't meet that national average.
You are always basically going to have losers, no matter how low that national average goes, so I think that Congress might be wise in taking a look at how that system is set up and what the benchmark should be for the sanctions system.
Mr. GOODLATTE. Thank you.
Page 117 PREV PAGE TOP OF DOC Mr. Viadero, do we have any reasonably accurate information about how much money is misspent each year in the Food Stamp Program and what percentage of that is fraud?
Mr. VIADERO. Yes. Overall, I believe FNS quotes a figure of approximately $1.1 billion. That is a lot of misissuances, a lot of overissuances.
Mr. GOODLATTE. Is it $1.1 billion out of $17 billion?
Mr. VIADERO. Yes, approximately so; and that is the misissuances, overissuances, what the State owes FNS, because a lot of the States aren't as forthcoming as they should be with payment of those misissuances.
Mr. GOODLATTE. And what percentage of that would be fraud?
Mr. VIADERO. That does not include the fraud figure. The fraud figure, we estimate at OIG to be between $1 billion and $1.5 billion.
Mr. GOODLATTE. So youit is possible that the fraud is actually greater than the mistakes that are made for various reasons?
Mr. VIADERO. Absolutely. Just to give you a quick example, we just finished an operation out at New Orleans, and we went into about 20 stores, 25 stores, and the fraud in just those 25 stores is estimated to be between $25 and $35 million.
Mr. GOODLATTE. So it is possible that the loss rate with food stamps, even after all the reforms we put in place through the Welfare Reform Act and so on, is still 15 percent of the total amount spent between the honest mistakes made, if you will, and the dishonest mistakes made.
Mr. VIADERO. Oh, yeah, but I am also happy to report that the dishonest mistakes are coming down. As EBT comes on line, that gives us a tool, and that tool allows us to monitor the system. Virtually on a real-time basis, we can monitor the system and find out where the errors are ongoing.
And due to resources of my office, which have been decreasing on a steady basis, we lost 24 percent of our staff over 5 years due to budgetary constraints. There is just nobody else to do the cases. We have more than enough cases to go. We have approximately 800 cases backlogged just in major food stamps. We only investigate the food stamp investigations when they average 3- to 400 percent of food sales. In other words, if a place reported they had food sales of $100, but they had food stamp redemptions of $500, we would look at that. It is that kind of multiple that we are forced to push.
Page 118 PREV PAGE TOP OF DOC Mr. GOODLATTE. And have you requested additional resources so you can lower that number? And I hope you throw insomething into the mix. We certainly wouldn't want that to be a guideline to the public, that as long as their fraud is below that rate, they
Mr. VIADERO. The bad guys have already figured that out. They seem to be one step ahead of us all the time, and in response to your query, yes, every year we ask for more resources.
Mr. GOODLATTE. Well, keep us posted when you do, so that we can advise the appropriators of our opinion that you should have more help in that.
Mr. VIADERO. Thank you, sir.
Mr. GOODLATTE. Mrs. Clayton.
Mrs. CLAYTON. Do I understand you to say that the percentage of fraud was 1 percentwas $1 billion?
Mr. VIADERO. Yes, ma'am.
Mrs. CLAYTON. Out of $17 billion?
Mr. VIADERO. Yes, ma'am. Approximately, yes.
Mrs. CLAYTON. Did you hear the Under Secretary testify a few minutes ago where he says the vast majority of program benefits go under the household that needs them in 2000, about 6.5 percent of program benefits were issued in excess of the correct amount and an additional 2.4 percent should have been issued where recipients were not. The combinedcombined overall payment error rate of 8.9 percent.
One billion and 17 percent would be what? I mean, 1 billion and 17 billion would be what? Is there a difference?
Mr. VIADERO. I am not a CPA, and in my case, I couldn't pass arithmetic, so I can't get into that without taking my shoes off.
Page 119 PREV PAGE TOP OF DOC Mrs. CLAYTON. I hear you. Well, I am just wondering where he got those figures from.
Mr. VIADERO. I can tell you, we normally query our systems, as well as Secret Service. So we sort ofthe Office of Inspector General and Secret Service concur on the $1 billion fraud figure.
Mrs. CLAYTON. OK. Well, I concur with your conclusion; if it is not the exact amount, it is far too much, and you ought to get the resources you need to make sure that we correct that.
But I am also looking at your testimony. The Secretaryyou make this statement, which you reiterate, which you said, under the OIG audit efforts that the EBT system indeed would cut that down. So it is cutting or will cut it down?
Mr. VIADERO. Oh, it is cutting becauseI will give you an example.
In the State of New Jersey when it went on-linewhen EBT went on-lineI think it went on in 1999, if I recallit was out for a week, and we saw one small fish store injust outside of Jersey City. The people were in queue at 4:30 in the morning when the benefits were posted to the cards.
We initiated a search warrant. We went in, and we recovered literally shoe boxes of EBT cards. People had sold the rights to their cards for about $100 apiece, which allowed this unscrupulous vendor to just swipe the card through the machine every month and receive the full food stamp benefit posted to his account.
Mrs. CLAYTON. So EBT resource is not the only thing you need. You need manpower, too, I gather. In addition to all 50 States having an EBT system, you and the Inspector General's staff need to have the necessary manpower to do the kind of monitoring and quality control to make sure this goes down?
Page 120 PREV PAGE TOP OF DOC Mr. VIADERO. Yes, ma'am. We definitely do. We need more auditors to work with the States, and I am very happy to state that the under secretary's office in Texas and my office, we do everything but hold hands and sing Kumbaya in Texas. It is a joint
Mrs. CLAYTON. What was that?
Mr. VIADERO. It is a littlewe hold hands and sing Kumbaya. We work and play very well together.
Mrs. CLAYTON. All right.
Mr. VIADERO. That is Sunday school.
Mrs. CLAYTON. That is all right.
Mr. VIADERO. We work and play well with the State of Maryland and the resources there, too. It is just a good thing. It is a common-sense approach. It is the right thing to do, both for the people of the country and people in the individual States.
Mrs. CLAYTON. Let me go quickly to Mr. Robertson.
Mr. Robertson, my line of questioning was similar to the chairman's. I am trying to make a relationship between the simplification and the quality control, and I think I understood you to say that you didn't necessarily have to sacrifice the integrity of the program byin fact, in simplification, your approach would be that it could indeed be for the beneficiaries, as well as for the people, how far to administer it. Is that
Mr. ROBERTSON. Yes, ma'am. And, again, I would just like to reemphasize what we are basically pushing for today, and that is for FNS to take the lead in working with various stakeholders to examine simplification options in a very systematic manner. And by ''systematic,'' I am really talking about looking at each option from the standpoint of what is it going to cost to implement, what are its effects possibly going to be on participation, what are its effects possibly going to be on FNS's ability to target benefits?
Page 121 PREV PAGE TOP OF DOC And then maybe throwing in a broad, general criterion to evaluate each of these options, that being, to what extent will implementing the proposed simplification move the Food Stamp Program in the same direction to either complement or support the goals of welfare reform?
We are looking to start the process right now during the reauthorization process, to really systematically look at the simplification possibilities.
Mrs. CLAYTON. One caveat. I was justdidn't want the simplification to be one cookie-cutter to fit all, because in some instances, we will denysome senior citizens obviously have different deductions. So if we are moving to simplifying certain deductions, we will deny people their unique opportunity, or deny States to recognize some have higherso I agree, if simplification can protect the integrity of the program both ways, accountability and to make sure the beneficiaries who are intended weren't shortchanged in our effort to swiftly get through the process, then that is a win-win.
Thank you, Mr. Chairman.
Mr. GOODLATTE. Thank you.
And, gentlemen, we very much appreciate your joining us today, and we look forward to continuing to work with you on these ongoing issues. Thank you.
We would now like to invite the fourth panel to the table: Mr. Ron Haskins, senior fellow, Brookings Institution, Washington, DC; Mr. Robert Rector, senior research fellow, Heritage Foundation, Washington, DC; Ms. Stacy Dean, director of Food Stamp and Immigrant Policy, Center on Budget and Policy Priorities, Washington; Ms. Coeli Brunty, Food Stamp Program participant from Emmitsburg, Maryland; Mr. James Ohls, senior fellow, Mathematica Policy Research, Inc., in Washington, DC, Ms. Claryce H. Nelson, State coordinator for consumer issues, AARP, Washington, DC. .
We would be glad to receive all of your testimony at this point, starting with Mr. Haskins. Welcome.
Page 122 PREV PAGE TOP OF DOCSTATEMENT OF RON HASKINS, SENIOR FELLOW, BROOKINGS INSTITUTION
Mr. HASKINS. Thank you, Chairman Goodlatte. Chairman Goodlatte and Mrs. Clayton, thank you very much for having me here.
My name is Ron Haskins. I am at the Brookings Institution and the Annie B. Casey Foundation. Before that, I was with the Committee on Ways and Means for many years and had a chance to work with the staff of this excellent committee. Despite that flaw in my background, I nonetheless was invited to come testify today, and I greatly appreciate your having me.
I would like to do a very simple thing and that is simply to establish part of the background within which this subcommittee would be well advised to consider reauthorization of the Food Stamp Program and its contacts within welfare reform.
As many as 2 million mothers, who in the old days were on welfare, are now working; and typically, they are working at jobs that pay $6.50 or $7 an hour. And typically, their annual income is about $10,000, so a mother and two children with $10,000 of income is not necessarily well off. They are probably better off than they were on welfare, but they are not very well off.
And the Committee on Ways and Means and many other committees in the House, over a period of years starting in the mid1980's, started what I think we should call the ''work support system'' to make sure that these families had more money than they were capable of earning, and in that way, we could provide very substantial incentive to keep people off welfare, to prevent welfare dependency.
Now, this work support system has several major programs: the Earned Income Tax Credit, which can provide these families with up to $4,000 in cash; the Medicaid Program, which guarantees health insurance coverage to their children and the mothers in many cases; child care, which has absolutely exploded, both Federal and StateFederal spending has increased from about $8 billion in 1995 to almost $21 billion this yearthe Child Cash Credit, which is now refundable by virtue of the tax bill that the Congress just passed; and the Food Stamp Program, which can provide a mother working for $10,000 with about $2,000 in benefits that is very near to cash.
Page 123 PREV PAGE TOP OF DOC So typically, this mother, if the system worked right, would have earned about $10,000would have about $6,000 in combined cash, or near-cash, of about $16,000, plus she would have health insurance and child care. So this is a superb system. It is an extremely fair system, and it is why we can in good conscience have a very tough welfare system.
The problem arises with the Food Stamp Program, because as it is currently constituted, it is failing many of these mothers and children. The most recent data that I know of on national probability data, taken in 1997 and 1999, is, only about 40 percent of the families leaving welfare with children, 130 percent of poverty, actually get food stamp benefits.
Now, I would like to emphasize this is a natural thing. This is not surprising. In some cases, I think it is reasonable that we didn't even anticipate that this might happen. But things change. The programs are now very different.
Welfare itself is very different, and all of the other programs have to accommodate themselves to a new philosophy of welfare in this country, which is that people should work and that their benefits should be dependent upon their work. So that is why we have to look carefully at the Food Stamp Program, and why I think this subcommittee has a serious responsibility to try to figure out ways to make it work better.
I will leave it to others on this panel, and especially the next panel, to suggest specific remedies, but I would like to just mention a few things they hope this subcommittee would consider.
First of all, there has to be a long hold-harmless period. Think of it this way, Mr. Chairman. In the TANF Welfare Program, if you don't put people to work, the Federal Government finds you, literally. In the Food Stamp Program, if you do put people to work, the Federal Government finds you in almost every State, and that is because these are the cases with high error rates.
So the States really have two very, very incompatible programs, and that is why changes have to be made in food stamp, particularly in the quality control system, and this period of hold-harmless that I am suggesting, that is now available in regulations, would allow the States not to have to redetermine benefits for some fairly lengthy period of time, say 6 months. That would be a very important change that would be in the right direction.
Page 124 PREV PAGE TOP OF DOC Second, I think the State shouldn't be ableshould have a lot of flexibility, maybe even complete control, about how they document income. There are a lot of issues with documentation that States have.
Third, how deductions are counted, excess housing and so forth. Again, there needs to be very substantial flexibility.
Mr. Chairman, if you follow the model of welfare reform, we put provisions in the law that explicitly limit it, had administrative capabilities of, in this case the Department of Health and Human Services, because bureaucrats will try to administer and they will overadminister and overregulate. So there have to be some things in the statutesconsistent, of course, with quality control and with not losing Federal dollars, since this is 100 percent a Federal programthat give the States a lot more flexibility.
My last point is this, Mr. Chairman. If you look at the data from the current population survey that shows the income of all Americans, and if you look at the bottom group, the bottom 20 percent of female-headed families with children, you will see that they get a surprisingly low amount of food stamps. If we could correct this problem, I have no question that we could very, very substantially reduce poverty in the United States by a broader Census Bureau measure of poverty than the official measure.
So what this committee is about here is, we will have a very major impact on child poverty in the United States.
Thank you, Mr. Chairman. I would be happy to answer any questions.
[The prepared statement of Mr. Haskins appears at the conclusion of the hearing.]
Thank you, Mr. Haskins.
Mr. GOODLATTE. Mr. Rector, we are pleased to have your testimony.
Page 125 PREV PAGE TOP OF DOC
STATEMENT OF ROBERT RECTOR, SENIOR RESEARCH FELLOW, HERITAGE FOUNDATION
Mr. RECTOR. Thank you for having me here to testify.
Let me begin my testimony by talking about a few basic facts about the Food Stamp Program. Eighty percent of food stamp aid goes to families with children. Of the aid that goes to families with children, about 85 percent is going to single-parent families or families with no parents at all.
Although most food stamp households contain able-bodied adults of working age, very, very few of these are actually employed during the period of receipt of food stamps. For example, only one-third of single mothers receiving food stamps are employed. Of able-bodied, adult nonparents, only one-fifth of those are employed, even though they are all of working age and they are capable of work.
And then the third element is that food stamps are primarily about long-term dependence. We examined, using Labor Department data, food stamp receipt of a cohort of individuals over a 20-year period from 1980 to 1998, and what we found was that half of all the food stamp aids spent during that period went to individuals who received food stamps for more than 8 1/2 years out of that 20-year period; 40 percent of total food stamp spending went to families that received food stamps for over 10 years during that period. And that long-term group, which is 40 percent of total spending over 10 years, on average, during that period, that group received $4,500 per household in food stamp aid.
When you look at that, what we can see is that food stamps today closely resembles the old failed Aid to Families With Dependent Children Program; that is, it is primarily assistance to single-parent households where the mother is not working and where dependence on welfare is long-term and near permanent. But while we reformed the AFDC Program by replacing with TANF, food stamps now seems to operate in direct contradiction to all the essential principles of the TANF reform.
Page 126 PREV PAGE TOP OF DOC For example, one, while the goal in TANF was to reduce dependence and reduce participation in case load, the goal of food stamps appears to be to increase participation and increase the number of recipients and increase dependence.
Second, while TANF has work requirements for recipients, the work requirements in the Food Stamp Programs are minimal and restricted to a very tiny segment of the role.
Third, while TANF is based on the idea of reciprocal obligation that the government shall give aid but shall require constructive behavior on the part of the recipient, food stamps remains primarily based on the idea of one-way handouts and permissive entitlements to participants.
Fourth, TANF has time limits, while food stamps is a permanent and open-ended entitlement.
Now, we can talk briefly about what lessons we have learned from TANF and what TANF has accomplished. First, if I could show you on the chart there, we see that as a result of TANF reform, the AFDC case load has been cut more than half. And as we can talk about later, this is almost exclusively due to policy changes and not economic conditions.
The second rule that we have learned from TANF is that States that have tough work requirements have, by far, seen the greatest reductions in dependence.
And the third and most important rule that we have learned from TANF reform is that States that have tough work requirements, stringent work requirements, on recipients, have the greatest declines in child poverty. For example, the State of Wisconsin has a very tough system that has reducedresulted in 90 percent drop in case load, but also a 50 percent reduction in child poverty.
Therefore, I suggest that the reforms in TANF should be extended over into food stamps; particularly, I would say that all able-bodied nonelderly adults of working age in the Food Stamp Program should be required to work in exchange for benefits. If they cannot find a private-sector job, they should be enrolled in community service jobs.
Page 127 PREV PAGE TOP OF DOC This would cover one group, the so-called ABAWDs, able-bodied adults without dependents. They should all be required to work in the manifold exemptions that exist in current law, or that group should be eliminated.
Second, all parents with children over age 3 should be required to work in exchange for benefits. If they cannot find a private sector job, they could be engaged in community service work.
And finally, States should be given the option of requiring work of parents with kids under age 3. The total work should not exceed the value of food stamps divided by the minimum wage. All recipients should be given the opportunity to participate in community service before they are cut off.
What we have learned primarily from welfare reform is that welfare, with work requirements, will dramatically reduce poverty relative to a permissive system without work requirements, and that is the direction we could go in food stamps.
[The prepared statement of Mr. Rector appears at the conclusion of the hearing.]
Mr. COOKSEY [presiding]. Thank you, Mr. Rector.
I have been advised that we have to stick to the 5-minute rule so everyone can have their chance to speak.
Ms. Stacy Dean, director of food stamp and Immigrant Policy, Center on Budget and Policy Priorities, Washington, DC. Welcome to the subcommittee, Ms. Dean.
STATEMENT OF STACY DEAN, DIRECTOR, FOOD STAMP AND IMMIGRANT POLICY, CENTER ON BUDGET AND POLICY PRIORITIES
Page 128 PREV PAGE TOP OF DOC Ms. DEAN. Thank you, Mr. Chairman, for providing me with the opportunity to testify. As you noted, my name is Stacy Dean and I am the director of food stamp and immigrant policy at the Center of Budget and Policy Priorities. The Center is a nonprofit institute in Washington, DC here, that conducts research analysis on an array of issues affecting low- and moderate-income families both at the State and Federal level, and the Food Stamp Program has long been central to our work.
Despite the program's original success in reducing hunger and poverty, the program faces several challenges which reauthorization has the opportunity to address. I would like to describe some of the most significant issues facing the program and briefly offer suggestions that could greatly improve it, without requiring radical change or changing the program's mission.
When the Congress last reauthorized the Food Stamp Program, the budget environment was very different. In an effort to reduce growing budget deficits, the Budget Committee instructed the Agriculture Committee to achieve significant savings in the Food Stamp Program. Almost $28 billion in food stamp deductions were enacted as a part of the welfare law, and almost two-thirds of these cuts came from reductions in the purchasing power of benefits for working families, the elderly, the disabled, along with other households.
Today, the Federal Government is running a surplus. The benefit reductions enacted in 1996 that affect the elderly, the disabled, and working families should be reexamined. The overall adequacy of food stamp benefits also merit consideration.
I would urge the committee to consider the proposals in this year's bipartisan bill, H.R. 2142, the Nutrition Assistance for Working Families and Seniors Act. H.R. 2142 contains excellent proposals to strengthen benefits.
Like Dr. Haskins, I believe another challenge facing the program is the need to do a better job of reaching eligible households. According to the USDA, between 1994 and 1998, the percentage of eligible households that participated in the program dropped from 71 percent to 59 percent. Working families have borne the brunt of this decline. This is particularly troubling at a time when welfare reform is encouraging poor families to rely upon work rather than cash assistance. Along with Medicaid, the EITC, and VITC, food stamps are critical work support that helps these poor families make ends meet and put food on the table.
Page 129 PREV PAGE TOP OF DOC Participation is declining amongst working families, because they are finding it increasingly burdensome to apply for and keep food stamps. Because households with earnings are more difficult for States to process accurately, States often feel the need to require additional paperwork and office visits for them; yet making food stamps more difficult for working families to access undermines welfare reform.
To address this problem, the food stamp quality control system must be reformed. Under the current system, States do better when they institute policies that reduce errors but also impede access, particularly for working families. And I believe this incentive must be changed.
Other important changes could be made that would streamline access to benefits and simplify the benefit structure. In recent years, Federal and State Governments have taken steps to improve access for working families and children to the Medicaid and State children's health insurance program, and our proposals draw upon those successes.
The final challenge concerns legal immigrants and single childless adults whose eligibility was curtailed as a part of the 1996 welfare law. These restrictions should be revisited.
And I would like to focus for a moment on the immigrant restrictions. Today, the Food Stamp Program places more severe eligibility restrictions on legal immigrants than SSI, Medicaid or TANF. While the restrictions were directed at legal immigrants, they have also had an adverse impact on the U.S. citizen children of these legal immigrant parents. Despite the fact that the welfare law did not make these children ineligible, 70 percent of those who were participating in 1994 have left the program, and this is twice the rate of overall decline. H.R. 2142 would remedy this problem by restoring benefits to these legal immigrants.
On a final note, I would just like to add that I do not believe converting food stamps to a block grant would be a wise decision. As a block grant, the program would no longer increase support to communities during times of economic downturn. The program is more responsive to increases and decreases in unemployment than any other means-tested benefit, nor would a block grant reduce gaps amongst States in their overall support for poor children.
Page 130 PREV PAGE TOP OF DOC Finally, a block grant tied to current expenditure levels would provide no new funds to address the program's largest problem, the low participation rates amongst working families.
Thank you very much for the opportunity to testify, and I look forward to answering any of your questions.
[The prepared statement of Ms. Dean appears at the conclusion of the hearing.]
Mr. COOKSEY. Thank you, Ms. Dean.
Ms. Brunty, who is a Food Stamp Program participant from Emmitsburg, Maryland. Welcome to the committee, Ms. Brunty.
STATEMENT OF COELI BRUNTY, FOOD STAMP PROGRAM PARTICIPANT, EMMITSBURG, MD
Ms. BRUNTY. Hello. My name is Coeli Brunty and I am from Emmitsburg, Maryland. I am a 24-year-old single working mother of two boys, ages 3 and 5, and I am raising these children by myself. In order to do this, I have worked as a pizza delivery driver for James Gang Pizzeria for over 2 1/2 years. I commute 45 minutes each way to get to work and travel about 200 to 240 miles a week delivering pizzas. I work 4 days a week and earn $7 an hour plus tips, which sometimes may be only $1 a day. I must pay all my own work-related car expenses.
To manage my job and caring for my children, my sons go to school or Head Startand day care. Two days a week my mom watches them. For a while I lived with my mom, but I applied for an apartment through section 8 housing and finally a two-bedroom apartment became available. So now I am paying $164 a month in rent. This amount is based on my earnings plus child support. I am supposed to receive child support, court-ordered, for one of my children. But that check, $64 a week, comes only sporadically.
Page 131 PREV PAGE TOP OF DOC Right now, I am receiving about $170 a month in food stamps. What do food stamps mean to me? It means that I know my sons will never be hungry and that I can eat. I am not sure we could make it without this help. Food stamps are my safety net. When the child support checks don't come, food stamps mean I can buy milk, cereal and fruit for my boys to eat.
But as a working parent, I do wish it were easier to get help from the Food Stamp Program. I have to visit the food stamp office every 6 months to renew my food stamps. When I go to these appointments, I have to drive 46 miles round trip, pay for gas and parking, and I usually have to stay for half an hour to an hour. So I have to take time off work for this. If less frequent office visits were required, I would not have to take off of work. Employers don't like having frequent time-offs.
I also have had a problem at the food stamp office because of the car that I own, which is necessary for my employment. I am responsible for repairing and maintaining my vehicle, carrying car insurance and covering other unforeseen car expenses. With my old car, during a 3- to 4-month period, I incurred repair costs of over $2,000. My employer then recommended that I purchase a reliable vehicle in order to keep my job. I bought a bottom-of-the-line, no-frills, Kia Rio with a $12,000 loan. This loan amount was needed in order to pay off the old car debt and purchase the new car. The bank required that I have a cosigner for this loan.
There is a limit set by the Food Stamp Program on the value of the car you can own, which I was never informed about. I learned that my eligibility for food stamps was being challenged because the car's value was over the limit and I had to submit information about the loan payments and a letter from my employer stating that a reliable vehicle is needed for my job. I had to wait 3 to 4 weeks to get word, and my situation was reviewed and, in fact, I could continue to receive food stamps. But the car still seems to be a source of contention, because when I go to do the periodic paperwork, I am still questioned regarding my vehicle.
Page 132 PREV PAGE TOP OF DOC The Food Stamp Program means so much to me and my children, that if we could do something to make it easier for families like mine who are trying to balance work and children's schedules and visits to social services, it would be a big help. Thanks for the opportunity to talk today.
[The prepared statement of Ms. Brunty appears at the conclusion of the hearing.]
Mr. COOKSEY. Thank you, Ms. Brunty.
Mr. Ohls, senior fellow, Mathematica Policy Research, Inc. of Washington, DC. Does that mean you are a mathematician?
Mr. OHLS. Actually, I am an economist. The name is a little misleading. Is that better or worse?
Mr. COOKSEY. In my experience, one of the greatest needs we have in this city is people thatwe need a lot more mathematicians. We have a lot of people like me that have warm and fuzzy degrees in medicine and too many lawyers and so forth, and we need more mathematicians. The only thing I know about economists, I have been told that they are guys that are good with numbers but don't have enough personality to be a CPA. Is that correct?
Mr. OHLS. Well, I would characterize it a little bit differently, but there is a little bit of math in an economics curriculum.
Mr. COOKSEY. Well, great. Economists are great guys. We need you guys. Mr. Ohls.
STATEMENT OF JAMES OHLS, SENIOR FELLOW, MATHEMATICA POLICY RESEARCH, INC.
Mr. OHLS. Thank you. The company I work for does government contract research for several of the agencies, including USDA, and we have done a lot of food stamp-related work over the last 25 years. It is safe to say I think that we are probably the origin of most of the numbers that have been quoted today under tabulation that we have done for USDA.
Page 133 PREV PAGE TOP OF DOC I would like to talk a little bit about access to the program and echo some things we have heard and maybe throw out a couple different ideas as well. My written testimony describes how we have done research on barriers for participation, and I won't repeat that here, but let me highlight a couple suggestions that I make in my written testimony for increasing participation.
One that is similar to things we have heard before today I think is streamline application processes. Ms. Brunty is lucky at how quickly she does her recertifications. In other parts of country, she would spend a lot more time in the office, based on survey work that we have done, doing the recertification for the food stamps. But in general, I think the basic point is that many applicants are spending hours and hours applying for food stamps, complying with verification requirements; after they get food stamps, complying with the verification requirements. And that is a big barrier to participation, particularly to people who are at work.
Now, let me throw out my idea, my favorite idea for simplification hasn't been mentioned yet. It is to rely more heavily on telephone interviewing of applicants, both at application and recertification. In the rest of this society, we have moved greatly, obviously, to telephone methods for almost everything. You can buy clothes, you can buy groceries, you can do your banking. I am told that over in the unemployment system, they are moving increasingly towards allowing people to apply for unemployment insurance by telephone. I think people should think hard about whether there might be more value in going to telephone usage here. It would certainly help working parents who have trouble taking off their jobs. There is some provision, I should say, for telephone case processing, but it is only for very certain restricted cases.
And leading to my second point, many States don't even use the authority they have to do telephone certification. Which leads me to my second point, which is, again, that we need to do something about the quality control system if we want to improve access to food stamps. As other people have said, the quality control and error rates are constantly on the minds of all the State and local welfare offices that I know of. You go and talk to a local welfare office, and they will tell you they are doing this, because they need to reduce error rates and they are under pressure from their States. You tell the States, they are under pressure from their Governor offices. It pervades the whole system in terms of how people think about structure and case processing, and it obviously creates incentives against access. You save yourself from errors by forcing people through endless hoops in order to make sure that as much as possible you have covered everything right.
Page 134 PREV PAGE TOP OF DOC So I don't think we should drop the QC system. What I think we should do is rethink the way incentives are handled so that there are fiscal incentives for a large number of States that force them into this situation.
Finally, I would echo Stacy's suggestion of not block-granting food stamps or not turning large amounts of authority for food stampswell, not increasing the State balance in terms of the Federal/State partnership. food stamp participation rates vary dramatically across States according to research we have done. For no apparent reason. I mean, some cases you can tell why a State might be high, but most of the time you can't. I think it varies largely because of the State attitudes towards inclusiveness in their Food Stamp Programs, and given that track recordand there are many anecdotes coming from TANF we could talk about with it. I think it would be a mistake to believe that increased evolution to the States would increasecould be used to increase access or would result in increased access. Thank you very much for the chance of
Mr. COOKSEY. If I could use my temporary position as Chair, do you think that the States are not capable of making as good decisions as are made here in Washington?
Mr. OHLS. No. I think two things. I think first of all, Washington, through the QC system, is now providing States with incentives to make, in quotes, wrong decisions or not useful decisions with regard to access, because they are forced to spend all their time worrying about not serving people but keeping the error rates down.
And then second, I think the enthusiasm for creating access varies substantially among the States. We can find Statesthere are examples of States where there clearly are many State initiatives designed to create an open Food Stamp Program, and those States tend to have relatively high participation rates. There are other States where there is relatively little evidence that the State has worked hard to increase that access, and so I am concerned that evolution by itself doesn't alter their enthusiasm.
Page 135 PREV PAGE TOP OF DOC [The prepared statement of Mr. Ohls appears at the conclusion of the hearing.]
Mr. COOKSEY. The last witness would be Mrs. Claryce Nelson, State coordinator for Consumer Issues, AARP.
STATEMENT OF CLARYCE H. NELSON, STATE COORDINATOR FOR CONSUMER ISSUES, AARP, WASHINGTON, DC.
Ms. NELSON. Good afternoon, Mr. Chairman. On behalf of AARP, thank you for the opportunity to present the Association's views regarding the reauthorization of the Food Stamp Program. The Food Stamp Program is designed to help some of the poorest members of our society maintain a healthy diet. According to the U.S. Department of Agriculture, even if the cash value of food stamps were added to the gross income of beneficiary households, only 7 percent would move out of poverty. A 2000 GAO report noted that about 1.6 million to 2 million households with individuals age 60 and older lack sufficient food to keep healthy. The other majority of eligible older persons failed to receive food stamps.
The welfare reform changes of 1996 created some problems. The rate of food security among children exceeds that among other population groups, and AARP strongly supports legislative and administrative strategies to address that need. However, many who are eligible for food stamps but not receiving benefits are older individuals.
AARP will limit today's remarks to three general areas: improving access to food stamp information and simplifying the food stamp application, increasing the minimum food stamp benefit, and providing child-only food staff benefits for children under nonparental care.
A recent AARP issue brief noted that the food stamp participation rate among older persons was a very low 30 percent of eligible households in 1998, compared to 69 percent for children. The primary reason for the disparity is that seniors think that they are ineligible for benefits. More money is needed for outreach to let all eligible individuals know they qualify for assistance.
Page 136 PREV PAGE TOP OF DOC Another major deterrent to food stamp participation is the complexity and volume of associated paperwork. The 2000 GAO report cites the complaints of seniors about the burden of the application process. They found one State with a 15-page-long application. food stamp benefits are based on a formula called the Thrifty Food Plan. Because the Thrift Food Plan reflects an artificially low cost for a food budget, food stamp benefit levels have shrunk relative to actual food cost.
The Thrifty Food Plan should be revised to account more accurately for the actual food costs of low-income households. This change would allow and help those receiving the minimum food stamp benefit, currently $10 a month. Almost 60 percent of the households receiving the minimum benefit include a senior. The current $10 minimum benefit has not been adjusted for inflation since 1977, although food prices have increased over 150 percent since that time. Indeed, the meagerness of the minimum benefit alone discourages many otherwise eligible individuals. AARP believes that Congress should increase the minimum benefit and restore the indexing of minimum benefits for inflation.
The final topic of concern is intergenerational. It is the availability of nutritional support for children raised by grandparents and other family caregivers. The expense of grandparent child-rearing is a growing financial concern, especially for those with very limited incomes. The number of grandparents in this role is increasing rapidly, and they span every race and culture of grouping. Current food stamp rules make it difficult for grandparents and other caregiver relatives to get food stamps on behalf of children in their care. This is because children under age 18 who are in the care of a nonparent adult are considered a member of that adult's household. The rules require that all members of a household qualify. Therefore, ineligible grandparents and other caregiver relatives get no food stamp help, regardless of the economic impact of the child on the household.
The Food Stamp Program should allow grandparents and other nonparental caregivers the option of applying for food stamps on behalf of the children in their care.
Page 137 PREV PAGE TOP OF DOC In conclusion, Mr. Chairman, many poor households will continue to face nutritional risks and hunger if some changes are not made. AARP stands ready to work with Congress and all concerned to make the needed improvements. This concludes my remarks. Thank you.
[The prepared statement of Ms. Nelson appears at the conclusion of the hearing.]
Mr. GOODLATTE [presiding]. Thank you, Ms. Nelson.
Let me ask whoever wants to chime in on this. Do commissioners of State departments of human services prefer to have the same rules for food stamps as the TANF program, and what do you think? I will start with Mr. Haskins.
Mr. HASKINS. Yes, I would say they do. There is a panel next that has many commissioners on it and I believe they all would want to coordinate their food stamp rules, have more flexibility so that they can coordinate their food stamp rules with their TANF rules, and that would necessarily entail some release from the quality control system as it is currently constituted.
Mr. GOODLATTE. Anybody else? Ms. Dean?
Ms. DEAN. I think they would speak to that. I think, however, many of them would also say that they would like to be able to align rules to their Medicaid Program. The Medicaid Program has many more people in common with the Food Stamp Program, as they both serve the elderly, disabled, working families and children.
Mr. GOODLATTE. What would that require? Is there a big disparity there in terms ofand how much effort would it take to align all three, and would you try to do that with some kind of a Federal mandate, or would you do it by giving States the flexibility in all three areas?
Ms. DEAN. Well, we have offered a couple of proposals, and let me just give one as an example, where we suggested that States ought to be allowed to use the definition of income that they use in Medicaid in the Food Stamp Program, so long as major sources of income, like earnings and cash benefits, were counted. That would really streamline and reduce the number of questions that need to be asked and would simplify some of the quality control issues.
Page 138 PREV PAGE TOP OF DOC Also one of the things we suggested is testing usingand both Mr. Ohls and Mr. Haskins suggested thisusing the kinds of verification and documentation that are allowed in the Medicare Program and the Food Stamp Program.
I think it would be difficult to conform across all three because again, it is important to remember that food stamps and Medicaid serve a much broader population, and it is not clear that rules for families with children in a program that is promoting self-sufficiency are appropriate rules for the elderly and disabled.
Mr. GOODLATTE. Thank you.
Mr. RECTOR. I would emphasize that the fundamental disharmony between AFDC and food stamps is not in the eligibility criteria. It is in the area of work requirements. The major difference between these two programs now, which serve largely the same population, food stamps a little bit of elderly, little bit of disabled, but mainly single mothers, is that TANF says you have to work in order to get benefit s, and food stamps is going in the opposite direction. And what I see at the case level is in many cases, individuals who are required to work under TANF are evading the TANF work obligation. They are saying, hey, I don't need to do this, you can't force me to work for my TANF benefits because I can continue to get all my food stamps for free.
The Food Stamp Program is working in exactly the opposite direction, and what needs to be done in order to reduce child poverty and promote work and improve the quality of life for children is to bring those two programs into harmony and say yes, indeed, we will assist you, but we are going to require you as an able-bodied adult to engage in constructive activities to become self-sufficient, if you can't get a job, you are going to do some community service or some organized job search. That has worked so well in TANF, and it is just a shame that food stamps seems to be going in the opposite direction. That is where the disharmony between the two programs is.
Page 139 PREV PAGE TOP OF DOC Mr. GOODLATTE. So your contention is that the Food Stamp Program would have an even lower subscriber rate, that there is actually pressure on it for more subscription because of the difference between TANF and food stamps?
Mr. RECTOR. Absolutely.
Mr. GOODLATTE. Anybody want to respond to that?
Mr. OHLS. It is not what has happened so far. I mean, many of the peopleone of the concerns among, I think, many groups in terms of the participation rate is that there is ample evidence that over the past 4 years, many people who left TANF were not informed of their potential continued food stamp eligibility, and therefore dropped out of the program and didn't receive assistance that they needed. So I am not sure that I see how the food stamp goals are going up because of this. I think many would argue they are going down.
Mr. GOODLATTE. Has any kind of study been done to see how many people are on food stamps but not on TANF that would otherwise be eligible for TANF?
Mr. OHLS. I could supply the numbers for you. I don't have it at hand. The other point I would make is that in food stamps, unlike the former AFDC, the majority of households are notwork isn't relevant. They are elderly. There are a very substantial number of elderly, as my colleague to my left points out. Many of them are children. I mean, there are relatively few people left to talk about. I mean, one could easily discuss whether or not the work requirements in the A1 provisions are being applied appropriately.
Mr. RECTOR. If I could, that is simply incorrect. It is absolutely incorrect. Eighty percent of food stamp benefits in a given year go to families with children and 85 percent of that group, the families with children are single mothers and/or children with no parents at all. That is the classic AFDC system. It is almost a mirror population and we have heard a whole lot about
Mr. GOODLATTE. Is there a pool of people that are in the Food Stamp Program that are not in the TANF program?
Page 140 PREV PAGE TOP OF DOC Mr. RECTOR. Yes. And one part of that pool are individuals who were in TANF, who were required to do some job search, some work, some training, and they didn't do it and they got a sanction off or part sanction off of TANF, or a full sanction off of TANF, but they are continuing to get food stamps.
Now I would ask you to ask some of the State experts up here whether or not it is plausible to really argue that that individual's continued receipt of food stamps when they are refused TANF is not a factor in encouraging their idleness and in encouraging them to evade the TANF work obligation. It is a serious problem, and it is obviously occurring. But even if they are not on TANF, programs that reward idleness, that give something for nothing, that give a handout to those that are not working, we know from welfare reform that is exactly what we don't want to do, and that is what food stamps is doing now. We need to bring it in line with the welfare reform of 1996. It embodies all the old errors of the war on poverty. We need to do something different.
Mr. GOODLATTE. I am big fan of work requirements, and I would welcome evidence from either of you in support of or recitation of that position, because if indeed we have a situation where people are using the Food Stamp Program to not participate in the TANF program, we need to know that. That is not in the interest of their children if they are taking that position. They either ought to be qualified for both or they ought to be working.
Ms. DEAN. Mr. Chairman, I agree completely and I think that all of the evidence points exactly to the fact that food stamps is not undermining TANF work requirements. If that were true, you would expect to see an increase in the number of families that were relying solely upon food stamps, with no earnings and no TANF because if these families were, in fact, avoiding TANF and just living off of food stamps, the number would have risen. In fact, it has gone down. From 1994 to 1999, the most recent year for which we have data, it has declined by 190,000 families. Since 1996 it has come down by 90,000 families. The evidence does not support the position Mr. Rector has laid out.
Page 141 PREV PAGE TOP OF DOC In addition, if one looks at the households of families with kids, the share that is working has increased dramatically. In 1993, 23 percent of families with children on food stamps were working. In 1999 it was 42 percent. If you look at the share of families that were relying solely on food stamps and cash assistance with no earnings, it has gone down from 56 percent to 37 percent. So we now, amongst families with children, a larger share are working than relying solely upon cash assistance.
Mr. GOODLATTE. Well, that is good. Now let me
Mr. HASKINS. Mr. Chairman, could I make
Mr. GOODLATTE. Very briefly.
Mr. HASKINS. I want to draw a sharp distinction here. There is no question that there are more female-headed families working now than ever before, primarily because of welfare reform, part of the reason is good economy and so forth, but welfare reform is the real cause of it. However, that does not say that you should not have a Food Stamp Program that has very strong work requirements. The reason so many single parent families are working today is because the TANF program does have strong work requirements. If the Food Stamp Program also had strong work requirements, those numbers would go up even more, and as Mr. Rector suggests, everything we know says that it would follow that poverty would go down even more. So it would be better for the families and better for the children if food stamps did have strong work requirements.
Mr. GOODLATTE. I think that is a valid point. Let me, at this time, recognize the gentleman from Louisiana, Mr. Cooksey. Before I do, remind all of you that the record on this hearing, we will ask unanimous consent later to hold it open for 10 days, and I would welcome each of you getting me statistical information regarding your position on that point during that time.
Mr. COOKSEY. Let me just preface my remarks by saying that as a physician, I was trained and lived to take care of the weakest members of society, which includes children and the people that are beyond the working age, the elderly, and I really feel that most of this helps to deal in those areas, but as Members of Congress, we have to deal with people that go in and abuse the system, and I don't feel that children abuse the system, and I don't feel that elderly abuse the system, but to me, those who abuse the system are the people between the nonworking age or, say, from 18 to, say, 65 or 70, and my question then, is there a difference between the reduction of welfare caseload and the food stamp caseload, and if so, where is the correlation with the very young and the very elderly? And then the disabled in that working group, age from 20 to 60? The question is, is there a difference between the reduction in the welfare caseload and the food stamp caseload?
Page 142 PREV PAGE TOP OF DOC Mr. OHLS. Well, certainly, the welfare caseload has gone down more quickly.
Mr. COOKSEY. More quickly than the food stamp caseload? Why?
Mr. OHLS. Why has it done that? I think I would agree with the people sitting to my right on the table here that TANF has played a significant part in that. Both of those declines come, in part, from the increased buoyancy of the economy over the relevant period.
Mr. HASKINS. But part of the cause here is absolutely straightforward, there is just absolutely no question about it. If you stay on TANF, you don't lose your food stamps, you keep them forever, as Robert Rector has argued, but what has happened is that people leave welfare, and we know from very good studies that the probability that they are going to get food stamps, even the ones under 130 percent of poverty who are eligible for food stamps, only 40 percent of them actually get it. Only 40 percent. So that, in itself, is a major cause of the decline in food stamps. There is no question about that.
Mr. RECTOR. If you could look at this chart here, this actually shows the TANF AFDC caseload from 1950 to the present, and all the white periods there on that chart are periods of economic boom, and what you can see is that there were eight periods of economic boom from the Korean War to the present, not one of them resulted in a significant decline in AFDC, but all of a sudden, here at the end of the chart, the red line, which is AFDC TANF goes down 60 percent. What is different there? What is different there is at that point TANF recipients were required to work, and what we see with that work coming in line is a huge increase in female employment. And now we find the black child poverty rate is at the lowest point in U.S. history. The poverty rate of children and single-mother families, lowest point in U.S. history. Requiring work as a condition, not denying aid, but requiring work as a condition of getting aid is a tremendously effective antipoverty device, and it needs to be applied not just in TANF, but in all the means-tested programs that affect these families.
Page 143 PREV PAGE TOP OF DOC Mr. COOKSEY. One other question. For those that are not familiar with TANF, it means ''temporary assistance for needy families.'' how does ''temporary'' mean that they stay on food stamps forever? Because that is, in effect, what they are doing. That is what you are saying they are doing and TANF is supposed to be a temporary program, isn't it?
Mr. RECTOR. There is a 5-year time limit in TANF. There is no time limit in food stamps, but even more important in TANF is the work requirement. We require at least half of the caseloads to work, and many of the States have gone well beyond that. So that is the difference between the two programs. food stamps, there is no time limit, there is no work requirement. TANF, there is a work requirement and a time limit, and that propelled single mothers off of welfare and into the labor market, and everyone has benefitted as a result of that.
Ms. DEAN. I think there is another important difference that merits consideration, and that is that the cash assistance eligibility levels are much, much lower than the Food Stamp Programs. So when family leaves cash assistance for work, and Mr. Haskins points out in his testimony that they often leave for wages that are in the range of $6 to $7 per hour, and maybe working 35 hours a week, they are still eligible for food stamps.
In fact, an example of a three-person family working 34 hours a week, $6.50 an hour, they earn $884 a month. They are eligible for $154 of food stamps. That raises their monthly wages by about 20 percent. If that family is working hard and doing everything asked of them by welfare reform and the cash assistance program, and they are still eligible for food stamps and Medicaid and the earned income tax credit, I see nothing wrong with them continuing to receive the benefit.
Mr. COOKSEY. Thank you. And in closing, I would say that in a country with as much surplus as we have in food, and we obviously are all on the Agriculture Committee, I think it is very important that we do everything to make sure that the truly needy get everything they need, and again address, the needs of the weakest members of society, the children, the elderly, and the disabled in that 20- to 65- or 70-year-old group.
Page 144 PREV PAGE TOP OF DOC The problem is the abuse, and there are people that abuse the system, and I think that has been the case since the beginning of time, and of course, the time limit on this or the time line started in the 1960's when these programs were conceived. But thank you, Mr. Chairman, and thank you. Very good witnesses, and it is always good to have an economist here parading as a mathematician.
Mr. GOODLATTE. I thank the gentleman. The gentleman from Kansas, Mr. Moran.
Mr. MORAN. No questions, Mr. Chairman.
Mr. GOODLATTE. I thank our panel for a very valuable and lively discussion on this issue, and we look forward to receiving any submissions that you might send us.
The Chair would now like to invite our fifth panel to the table. Ms. Elaine M Ryan, acting executive director, American Public Human Services Association, Washington, DC. Ms. Sonia Rivero, commissioner, Virginia Department of Social Services, Richmond VA. Mr. Bruce Wagstaff, deputy director, welfare work divisions, California Department of Social Services, Sacramento CA. Mr. Douglas E Howard, director, Michigan Family Independence Agency, Lansing, MI. Ms. Jennifer Reinert, secretary, Wisconsin Department of Workforce Development, Madison, WI. Mr. Jerry W Friedman, executive deputy commissioner, Texas Department of Human Services, Austin, TX. Mr. Rich Savner, director, public affairs and government relations, Path Mark Stores, Inc., Carteret, NJ, on behalf of the Food Marketing Institute.
These panels get better and better as they get bigger and bigger. We would like to welcome all of you, remind you that your official written statement will be made a part of the official record, and that you will be strictly held to your 5-minute limit.
Ms. Ryan, please begin.
STATEMENT OF ELAINE M RYAN, ACTING EXECUTIVE DIRECTOR, AMERICAN PUBLIC HUMAN SERVICES ASSOCIATION
Page 145 PREV PAGE TOP OF DOC Ms. RYAN. Good afternoon, Mr. Chairman, and members of the subcommittee. I am Elaine Ryan, acting executive director of APHSA, a non-profit, bipartisan organization that represents the State and local public human service administrators throughout the country, and we have been doing that for 70 years, and thank you so much for the opportunity to testify. We have a lot of energy and a lot of recommendations around the reauthorization of the Food Stamp Program.
Earlier this year, APHSA sent to Congress a comprehensive set of recommendations contained in the report ''Crossroads: New Directions in Social Policy. Over a 2-year period, our members looked in a cross-program way of array of public human service programs and agreed on one fundamental point. The program that requires the most fundamental reform, the program they agonize over the most, I think, is the Food Stamp Program, because over time, the Food Stamp Program has really grown very different and apart from other human service programs.
We believe that the Food Stamp Program must remain a viable means of helping those in need, but in recent years, clients and State administrators have become frustrated with the program's complexity, its multiple barriers to recipient understanding and participation, its measurements and incentive programs and restrictive eligibility, complicated verification, discouraging working families, outdated quality control measures.
Since, I guess, 1996, and even before Congress enacted a number of reforms granting great flexibility in other public human service programs. TANF we have discussed, child care, Medicaid, State CHIP programs, have all expanded flexibility for States, and Congress had the vision of fundamentally reforming welfare in 1996, and we believe the time is now to fundamentally reform the Food Stamp Program, and we also believe that this program should value work, and it should also do a better job at connecting the elderly and the disabled individuals to the program.
But we believe the overarching goal should be simplification of the program. Streamlined front end eligibility that is understandable, that will improve access, improve accuracy and lower administrative costs. Think of it, the program's administrative cost is 21 percent. In Medicaid, the administrative costs are 3 percent, for a quarter of a trillion dollar program. Think of the complexity in this program. Think about the possibilities for error in some of the parts of the program that I will mention.
Page 146 PREV PAGE TOP OF DOC That is why we believe simplification of the eligibility process is essential. We are recommending several important changes. One is to use a gross income test to develop or to determine eligibility, that may be adjusted with a standard deduction for areas of higher living costs. Just to illustrate one of the complex deductions, the shelter deduction, the Food Nutrition Service issued a desk guide for caseworkers that was 76 pages long to tell them how to figure out just one of the deductions. Imagine the possibility of error.
So we are also calling for simplifying application processing, recertification, and we also, I think, have an exciting proposal that has been tried in South Carolina to connect senior citizens and the disabled to the program, not at the welfare office, but at the Social Security Office. This program has been demonstrated in South Carolina, and they achieved a 31 percent increase in the number of the elderly receiving food stamp benefits, and they saved $500,000 in administrative costs. The cost to the Social Security Administration was $2,300 to make the change. You see, elderly and disabled have all of their income taken at the Social Security Office to determine their Medicaid eligibility. Why not do food stamp eligibility at the same time? We think that is a cost saving that could sweep in, if brought to scale, an additional half million elderly into the program in a year's time.
We also believe that transitional food stamp benefits should be provided. In Medicaid, there is a 6-month transitional benefit. Why not do the same in food stamps? We are recommending the exemption of one vehicle. You heard from a food stamp working mom who said that it was the value of her vehicle that held such barriers. We believe that there should be a restoration of eligibility for noncitizens, and we believe that we should restore the historic match for EBT systems that has fallen.
I would like to just close in 5 seconds by saying this: We have three documents that I would like to submit for the record. One is analysis of the South Carolina demonstration for the elderly and disabled. I think it is an exciting possibility. The second is a report on the current status of State EBT systems for the committee's consideration, and last, a copy of our Crossroads document containing our fundamental recommendations that I couldn't describe all in their entirety, but would be happy to answer any questions you might have.
Page 147 PREV PAGE TOP OF DOC [The prepared statement of Ms. Ryan appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. They will be made a part of the record without objection.
And we will now hear from Ms. Rivero from my home State. We are delighted to have you with us today.
STATEMENT OF SONIA RIVERO, COMMISSIONER, VIRGINIA DEPARTMENT OF SOCIAL SERVICES, RICHMOND, VA
Ms. RIVERO. I am also from Puerto Rico originally.
Mr. Chairman and members of the committee, thank you for inviting Virginia to participate in this important hearing. The focus of food stamp reauthorization, from our perspective, should be to build on the 1996 changes that Congress made in PRWORA. We believe that Congress headed in the right with PRWORA, and we would like to see you go from there. We believe that we must continue to link the Food Stamp Program with welfare reforms, emphasis on work and self-sufficiency, something that you have heard repeatedly today, build on the success of the States in managing welfare reform and reverse the rigid regulations and micromanagement of the Department of Agriculture.
The administration of the Food Stamp Program today is riddled with a preoccupation with payment accuracy processes and quality control and is not in line with PRWORA. Federal regulations are not allowing States to take advantage of the simplification provisions and have increased the complexity of the program. You have heard this over and over today. The final regulation issued this past November retained prescriptive and complex requirements for food stamp applications and recertification procedures. These provisions continue to hamper our ability to operate an efficient program and discourage recipients with unnecessary paperwork and red tape.
Page 148 PREV PAGE TOP OF DOC Much of the focus to control spending and food stamps has been on Federal savings. Congress needs to ensure that Federal cost-saving measures do not result in a shift of costs to the States.
Allow me now please to address EBT. Virginia has contracted with an EBT vendor and will begin our pilot program this November. You will see it in Roanoke area about a year from now, exactly about a year from now. We are excited about the program, and we think that it is going to provide a lot of benefits for all of our clients and our client service partners.
There is, however, a high price for this improved service that we will be providing. The traditional 5050 match for administrative expenditures is no longer adequate and does not reflect the shift of responsibilities to States that formerly belonged to USDA. USDA is realizing significant cost savings since they no longer pay for the printing, distributing, redeeming and accounting for paper stamps. The Federal Government should pay 100 percent of the cost of functions that were formerly Federal costs under the paper systems.
State costs have risen because there is a lack of competition among EBT vendors. Currently, there are 33 States that share the same EBT prime vendor and are seeing basic prices double and triple from those paid just a few years ago. There is a Federal requirement that EBT clients and retailers have access to an EBT help line 24 hours a day. Call centers are a high-cost item for States. States have assumed responsibility for retail point of sale device deployment, training, marketing and complaint resolution. Relationships with food retailers in the past was a USDA function.
States must ensure that its EBT vendor enters into agreements with other networks, switches, gateways across the Nation so our clients are free to travel from State to State and to shop at certified food stamp grocers nationwide. In the paper system, there was no cost to States for providing this level of access for clients.
USDA's July 2000 regulation on EBT adjustments requires States to make adjustments to an account to correct an auditable out-of-balance settlement condition that occurs during the redemption process as a result of a system error. This rule is in conflict with the requirement that States follow generally accepted operating rules based on the commercial debit card model. In the commercial model, adjustments are settled between the customer and the processor. Virginia and the other States are going to be burdened with the cost of purchasing equipment necessary to make these adjustments.
Page 149 PREV PAGE TOP OF DOC The EBT system generates a mammoth amount of data. Every transaction made with the card must be documented. This data has to be used to report, analyze, manage and monitor activity at the point of sale, the Commonwealth's local and regional agencies, and the EBT vendor facility.
Virginia needs relief from the increased costs that we will incur. We recommend that the Federal share of the 5050 administrative match be increased to ensure that EBT costs do not continue to shift from USDA to the States.
Federal Government should further fund the efforts of States as they strive to develop new and innovative ways of delivering benefits electronically. EBT is a successful method of delivering benefits to clients. Virginia believes that now is the time to develop a more cost-effective model by reducing the vendor monopoly reign that prevails today.
Reauthorization provides Congress with the opportunity to reevaluate the program's goals and develop the framework for attaining these goals. We encourage you to move forward from PRWORA point of view or, in fact, Virginia would support your block granting the program.
Thank you, Mr. Chairman.
[The prepared statement of Ms. Rivero appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. Mr. Wagstaff, welcome.
STATEMENT OF BRUCE WAGSTAFF, DEPUTY DIRECTOR, WELFARE WORK DIVISION, CALIFORNIA DEPARTMENT OF SOCIAL SERVICES, SACRAMENTO, CA
Mr. WAGSTAFF. Thank you, Mr. Chairman and members, for providing this opportunity to express California's views regarding the Federal Food Stamp Program and its upcoming reauthorization.
Page 150 PREV PAGE TOP OF DOC As a national safety net, the Food Stamp Program plays a critical role in providing assistance for low income individuals and families in need. However, in order to achieve this role, we would agree with the numerous witnesses you have heard today that have stated that a broad overhaul is needed of the program. It is imperative that the program become much more accessible to needy families.
California differs from many States in the high percentage of its Food Stamp Program caseload that also receives TANF cash assistance. We seek 70 percent in that regard. This fact explains the concern and emphasis in my testimony with work and self-sufficiency. In California, we have had significant success moving families from welfare to work. Since the January 1998, implementation of our TANF program called CalWORKs, over 650,000 people have found jobs. Every aspect of our Federal welfare system has been altered to promote and support the movement of families from welfare to work with the very significant exception of the Federal Food Stamp Program.
The program, as you have heard, with its complicated eligibility and application requirements, has not been in line with this movement and has proven itself to be difficult to use by families who needed services and by administrators who are engaged in its operation. Many families who have just found jobs have to take time off to come in and apply for food stamps. Additionally, reapplication with a face to face interview is also required.
The existing image of the Food Stamp Program is perhaps its greatest drawback. Its perception as a welfare program tends to stigmatize even the neediest recipients. Many eligible persons are reluctant to participate. Many others decline altogether. The effort to ensure that all people in this country have the ability to meet basic food needs should not have a negative connotation.
Reauthorization provides the opportunity to change the focus of the program to better meet the needs of the public. Characterizing the program as a food security effort or as a work support, I think, would go a long way towards increasing the participation in needy households.
Page 151 PREV PAGE TOP OF DOC The administrative difficulty of the program combined with recipient inability to understand and abide by these complex rules must be addressed as you have heard, and as you have heard, simplification must occur in every phase of the program. In particular, the eligibility and benefit termination process needs to be streamlined to reduce the administrative complexity that both act as a barrier to participation and increases the potential of payment errors. There also needs to be corresponding increase in flexibility in order for States to be able to tailor a food security program that better meets the needs of their low income families.
Now you have heard about the intensive quality control process for determining payment accuracy. The concern we have is that this is the single measure of successful performance in food stamps. We certainly acknowledge the importance of families receiving the correct amount of benefits. However, using this process to ensure that every aspect of eligibility is checked and rechecked may deter States from seeking out those families with the greatest need and preclude them from participating.
While realistic program integrity measures should be a component of successful performance, other outcome measures consistent with program goals should also be considered. At a minimum, outcomes should include a measurement of the effectiveness of the program in serving low income families. For households who leave cash aid due to employment, food stamp benefits should become a major part of transitional services that assist these households to become self-sufficient and reduce the potential for returning to cash aid. In that regard, raising the minimum benefit level for working families should be explored in tandem with an automatic transitional period of eligibility.
The program should provide better incentives for employment. In administering TANF programs, many States have designed effective earned income deductions that are intended to recognize and promote an increase in earnings. In contrast, the current Food Stamp Program 20 percent earned income deduction has been the same since 1986. In regard to the availability of the program in providing food assistance to needy families, the issue of legal noncitizens, in our view, must also be raised.
Page 152 PREV PAGE TOP OF DOC With the passage of national welfare reform legislation in 1996, a significant number of individuals who had all met required immigration rules were denied continued access to the Food Stamp Program. As a result, California, along with 12 other States, established a State-funded program in order to continue providing food stamp benefits for legal noncitizens not covered by Federal food stamps. We believe it is time to consider restoring Federal eligibility for all legal noncitizens, thereby eliminating the need and the resultant cost and administrative complexity of maintaining a separate State program in addition to the Federal Food Stamp Program.
Our national food security program should play a more integral part in assisting today's low income families in times of need. The impending reauthorization provides the perfect opportunity to effect needed change to make the program meaningful, not just for the citizens of California, but for the Nation. Thank you.
[The prepared statement of Mr. Wagstaff appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. Mr. Howard, welcome.
STATEMENT OF DOUGLAS E. HOWARD, DIRECTOR, MICHIGAN FAMILY INDEPENDENCE AGENCY, LANSING, MI
Mr. HOWARD. Thank you, Mr. Chairman. I appreciate the opportunity to be here today to address you and members of the subcommittee. There is an area that we feel very strongly about. There would be some that would say a few of the tones in my written testimony are worded very strongly. I do want to tell you that it is not a tone of accusation about intention or integrity. In fact, I believe that generally there is a lot of consensus around where we have been and where we need to go, but rather, it is a tone of frustration by States in that we have seen a program that we believe is a very important program grow in complexity.
Page 153 PREV PAGE TOP OF DOC Under Secretary Bost spoke about the labelling of policies over the year. In isolation, all of those policies are very well intended and very defensible, but in a collective sense, I believe they represent a disservice to recipients and applicants and a disservice to taxpayers and a disservice to those who deliver the program, and I believe we have an opportunity to refine that and support current priorities around family self-sufficiency and maintaining program integrity.
I will speak a little bit about some of the intended flexibility in the Welfare Act of 1996 under PRWORA. I think generally, from a personal viewpoint, and I think it is shared by many of my colleagues, we are probably, after the fact, somewhat disappointed. We found that some of the flexibility was not really feasible to implement, whether it is the issue of cost neutrality you may have raised earlier or some other reasons. Some of the options we in fact found, given sick day circumstances, were actually not simpler, and in other cases, we had to trade that simplification in for complexity in another area, for example, aligning one set of rules, but then finding we lost an alignment in another direction. And in a final area, we became concerned that we actually lost some of that flexibility in subsequent Federal regulations.
So we think there is some opportunities there to work with you. We hope through the reauthorization process we can focus on that flexibility.
We also share concerns that the program is not hospitable to working families and others. We demand a lot of working families, whether it is office visits, shorter cert periods, records, contacts with employers, landlords, utility companies or tracking of changes. And given the types of jobs many of these households hold, that is quite a challenge, and I think it does contribute to the participation rate.
I would acknowledge that FNS, in recent months, has taken steps and are actually considering some right now, I believe, to try and help take some positive steps for working families, which will ultimately help the States in delivering the program. We know there are some other issues that I think Congress should look at, and generally what can you do to encourage that flexibility, whether it is in the application or eligibility process, areas of asset limit or just simplification of rules and direction to USDA.
Page 154 PREV PAGE TOP OF DOC I would like to affirm something Ms. Ryan spoke to around the opportunity to certify food stamps for SSI recipients through the Social Security Offices.
On page 5 of my testimony, there are a number of solutions. I won't run to detail of all of them. Some of them I have spoken to. The one I would highlight, we believe there is a great opportunity to really rework the eligibility and benefit determination piece, looking at how we can simplify the complexity of things ranging from group compositions to nonfinancial factors to income that is included and excluded in expenses and really get it down to focus purely on income and expectation of a percentage of income that goes towards food and a food standard so that we can greatly simplify it for everyone involved in the process.
I mentioned we are concerned about the complexity. Some of these things have been mentioned, but we know there are more than 200 pages of certification regulations on the program. There are something like 295 policy memos out there. I believe someone mentioned the Shelter guidebook of 76 pages. We have regulations.
Application process is highlighted in my exhibit on page 7. The application regs for food stamps are 33 pages where there are only four pages for Medicaid. I think that speaks something to the complexity of what we are sorting through. Also on page 7 are a series of additional solutions that I would ask you to consider in your deliberations.
Looking at issues of employment and training, we know there have been some conflicts. Those have been spoken to very well today. I think it is time to try and align those things and give States some room to move.
EBT, I am proud the say, that Michigan, at this time next week, will have all food stamp recipients in the State receiving benefits through EBT. I would concur with Ms. Rivero that we have seen a cost shift in benefits to the State and ask you to consider addressing that.
My final major issue I would cover following some of my colleagues' comments is the quality control system. I think just to really isolate this, page 10 there is a graph. We estimate that the average line worker spends between a half hour and 3 hours to try and get an eligibility determination right. I would submit that that is too long in and of itself. We know that QC workers spend 16 1/2 up to 40 hours to try and verify that. Any program that requires that much for QC on a single case needs to be reworked.
Page 155 PREV PAGE TOP OF DOC I think there are some other issues. We have some other recommended solutions on page 12. I would simply close by saying that we appreciate the opportunity here today. I know that my Governor, Governor Engler and his colleagues around the country, look forward to working with the Congress and the administration for opportunities to provide better services for our citizens.
Thank you, and I look forward to your questions.
[The prepared statement of Mr. Howard appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. Ms. Reinert, welcome.
STATEMENT OF JENNIFER REINERT, SECRETARY, WISCONSIN DEPARTMENT OF WORKFORCE DEVELOPMENT, MADISON, WI
Ms. REINERT. Good afternoon and thank you for the opportunity to share Wisconsin's perspective on the Food Stamp Program.
Since the passage of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, dramatic numbers of people in our State have moved off the cash assistance roles and have found and retained employment. In Wisconsin today, less than 7,000 families now receive cash assistance.
As welfare reform has progressed and more people have moved into the workforce, the provision of support services has become a key part of the package necessary to ensure job retention as families continue towards self-sufficiency through work. In Wisconsin, we have been able to expand health care benefits to low income working families through a Federal-State partnership called BadgerCare. As a result, more than 115,000 children and their parents have Medicaid coverage. This represents a 30 percent increase in covered families in the last 2 years.
Page 156 PREV PAGE TOP OF DOC We have also been able to secure and streamline Federal matching funds to greatly expand availability of quality child care services. Wisconsin now serves more than 342,000 children from 24,000 families through Wisconsin shares, our child care subsidy program for low income working families. This represents a 40 percent increase in child care subsidy program over the last 2 years.
Unfortunately, our ability to meet the needs of working families and promote good customer service when it comes to the Food Stamp Program has not kept up with these other programs. Instead, Wisconsin, similar to other States, has been hampered by the fact that the Food Stamp Program policies, which can be difficult to implement under the best of circumstances, have become even more challenging as people have entered the workforce and have fluctuating income and expenses. In particular, requirements such as face-to-face interviews, verification and documentation of voluminous data, frequency of reporting changes in household circumstances and frequency of redetermination of eligibility, are impediments to program participation and good customer service.
Wisconsin has been working very aggressively to overcome these challenges in order to ensure we are providing appropriate services to those who are eligible for them. In particular, Wisconsin has stepped up outreach efforts and increased access points to make application to the program easier, such as outstationing eligibility workers at nontraditional community sites.
As a result, while participation in Food Stamp Program has continued to decline nationally, we have seen a 10 percent increase over the past year, which is one of the largest increases in the country. More than 216,000 people are now participating in the program, the most since June of 1997.
In addition, Wisconsin has been highly successful in converting the paper coupon system to the electronic benefits plastic debit card. Our conversion took place in 2000. While virtually all other States saw a decline in program participation during conversion to EBT system, our caseload continued to grow, including families and disabled individuals, due to extensive up-front public education and outreach coordinated by our State, our local agencies, our advocate groups and all of us working together.
Page 157 PREV PAGE TOP OF DOC Nevertheless, the ability of Wisconsin to manage the Food Stamp Program as effectively and efficiently as possible in order to ensure the needs of participants are met is severely limited by the program's current parameters. For instance, the Federal policy limits the amount of liquid assets. What we would have to go through to apply for a home mortgage many people go through to receive their food stamps, and this is repeated every 6 or 12 months.
What is the result of this investment of time and energy on the part of the program participant? According to a recent report by the U.S. Department of Agriculture, the countable assets in an average food stamp case is only about $140. This is just one example of the complex requirements of the Food Stamp Program.
I have listed several of the modifications that we would suggest. We support the American public human services association's recommendations, and I have highlighted a number of those on page 3.
I should point out to you that in Wisconsin, there is a broad consensus that the Food Stamp Program must be simplified in order to reach the target population and streamline administration, the consensus of the opinion of the food stamp policy work group. We have a number of people working together on this.
In short, Wisconsin believes that the Food Stamp Program needs to be overhauled in order to improve customer service, streamline administration and to allow flexibility. Clearly, such changes can only be of benefit to participants, many of whom have taken the first and necessary steps to achieve self-sufficiency by entering the world of work and yet find the Food Stamp Program has not kept pace with their achievements.
[The prepared statement of Ms. Reinert appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. Mr. Friedman, we are pleased to have your testimony.
Page 158 PREV PAGE TOP OF DOC
STATEMENT OF JERRY FRIEDMAN, EXECUTIVE DEPUTY COMMISIONER, TEXAS DEPARTMENT OF HUMAN SERVICES, AUSTIN, TX
Mr. FRIEDMAN. Good afternoon. Thank you for the opportunity to speak about reauthorization of the Food Stamp Program. First, we appreciate your interest in Texas and in subjects we consider important regarding reauthorization. In Texas, we regard food stamps as a vital component of our safety net and a critical support for those seeking a stable economic life. Our goal is to have every eligible Texan participate in the Food Stamp Program and to receive their benefits timely and accurately. For us it is a win-win situation, a program that improves the quality of life for needy Texans, and yet benefits Texas retailers and Texas growers. It is good social policy as well as good economic policy.
In administering the Food Stamp Program, Texas has been involved in several initiatives that demonstrate our commitment to the program. We were the first large State to fully implement EBT. We established change centers to make it easier for clients to report changes, especially those who are working. For years, Texas has had a 24-hour expedited food stamp standard, and we implement that with 99 percent timeliness, and most recently, designed and implemented a Web-based client screening tool that allows potential recipients to search for services, including food stamps everywhere where there is Internet access.
Texas is also committed to payment accuracy as this helps build public confidence in the program. Texas has earned enhanced Federal funds for the past 3 years and is proud of the negative error rate of less than 1 percent. In Texas, we are constantly striving for a program that balances the need for accountability and program integrity with good customer service and program access.
Page 159 PREV PAGE TOP OF DOC We have been concerned over the decline in participation in the past several years, and consequently, launched a very comprehensive and aggressive outreach program. Under Secretary Bost described many features of that initiative in his testimony, so I won't repeat it, but I am pleased to report that these efforts appear to be paying off. From May of 2000 to 2001, we have had an increase in participation of 42,200 recipients, a 3.1 percent. This reverses a downward trend that existed over several years.
In terms of reauthorization our roundtable discussions on barriers and obstacles helped us formulate our recommendations. First, the Food Stamp Program must be accessible, and we believe that simplification is the key. Second, the program must be accountable in a way that protects the integrity of the program while allowing good customer service, maximum participation and low administrative costs. Third, the program should support States' efforts to assist clients obtain economic stability through work. We are specifically recommending two major changes, to simplify eligibility by using a single deduction and to simplify reporting by modifying the change reporting requirements.
Another concern for Texas is the need to improve the access for the elderly and disabled. We recommend an increase in the minimum benefit for the elderly and a standard medical deduction to ease the application process. We, too, in Texas have a pilot program that provides categorical eligibility for people who are on SSI.
In addition, we recommend changes in vehicle exemptions to support policies that focus on work, greater flexibility in administering employment and training funds, and changes to improve the accountability of the Food Stamp Program that includes a credible measure of program accuracy, but recognizes other factors of success as defined through sound research.
Finally, the committee asks for a status on EBT systems in our current implementation. Texas has operated an EBT program since 1994, and it has been an extraordinary success, supported by all stakeholders. In Texas, it is known as the Lone Star card. We provide cash and food stamp benefits to one half million card holders and handle 4.9 million transactions per month.
Page 160 PREV PAGE TOP OF DOC In February of this year, we entered the second generation of EBT, or EBT II. Our approach was unique in that rather than being relied on a single vendor, we successfully implemented a multivendor approach. This includes three distinct but interrelated functions, retailer management, data center operations and cost center operations. The State serves as a systems integrator utilizing software that we purchased and modified. The project was successfully implemented on time within budget and at an affordable cost. For Texas we believe our approach was effective from a service perspective and also assures State control of the system and provides us with cost protections.
I hope that these comments were helpful to you. I would be glad to answer any questions that you may have.
[The prepared statement of Mr. Friedman appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. Mr. Savner, you are the last of 17 witnesses. So we expect everything you tell us will not duplicate what anyone else before you said. It would be totally unfair to hold you to that standard.
STATEMENT OF RICH SAVNER, DIRECTOR, PUBLIC AFFAIRS AND GOVERNMENT RELATIONS, PATH MARK STORES, INC., CARTERET, NJ
Mr. SAVNER. The only duplicative thing I will say is thank you for allowing me the opportunity to come and testify before your committee.
Mr. GOODLATTE. We will let you say more than that. Thank you for joining us.
Mr. SAVNER. Thank you and good afternoon to you as well as the members of the committee. I am here to testify on behalf of the 21,000 retail food stores across the country who are belonging to the organization, Food Marketing Institute.
Page 161 PREV PAGE TOP OF DOC Before I go any further, I would just like to talk to you about my company, since perhaps you are not familiar with us. We are one of the top 20 food retailers in the country. We are one of the market share leaders servicing the metropolitan Philadelphia, New York City and New Jersey areas, and we have sale of almost $4 billion annually. We service many urban communities and a significant portion of our customers do receive some portion of public assistance, including food stamps and WIC.
Since the implementation of EBT, I think it is a fair statement to make that the implementation of the program hasn't always been smooth. There was a period of time last year when the outages were so significant they caused quite chaotic conditions in a lot of our stores. Thankfully, though, the outages have been reduced and significantly I would say over the last 7 months.
And although 80 percent of the country has implemented EBT and the feedback at this point is generally positive from the customers as well as the retail community, there are a few technical issues that really need to be resolved. These issues are common-sense initiatives that have a minimal cost, and we believe would improve the efficiency for both recipients and the retail community. I would like to address three of those issues.
The first is the need to get FNS authorization numbers within 14 days in advance of a store's opening. A number of the retailers have expressed frustration with the delay in getting these numbers in order to be allowed to accept food stamp benefits from a customer. Many times those numbers aren't available to retailers until the day before the opening or sometimes thereafter. This prevents the retailer from advertising that food stamps or EBT will be accepted and prevents us from testing our point-of-sale equipment to ensure that the food stamp components work successfully.
If a retailer doesn't have an authorization number and a customer attempts to purchase products with that card on opening day, there is often an upset customer, a backlog of other customers given the high volume which a supermarket typically does in its grand opening week. We believe the adage that first impressions are lasting ones, and an upset recipient may not return to our store that is unauthorized, and just as an example and contrast, our store which we opened in Harlem 2 years ago was authorized for both WIC and EBT from the beginning, and I think that both Pathmark and the recipients were well served.
Page 162 PREV PAGE TOP OF DOC There are seven regional offices across the country with varying requirements in obtaining authorization numbers. I have heard people prior to my testimony say that they look for a streamlining in the application process, and I would echo the sentiments, except from the retailer's perspective, we are looking for a streamline of the application process to authorized retailers from both not only the food stamp perspective, but also from the WIC perspective. Often there is overlap in the applications that are required, and it seems to me like it would be fairly incumbent or beneficial to both the retail community and others to have that blending and duplicativeness eliminated.
Second, there is the need for live retailer-purchased test cards. It is important to the retail community that we have the assurance that something as important as EBT is going to work correctly. In the stores we test fire alarms, refrigeration equipment and other kind of credit card transactions prior to opening to make sure it works. EBT shouldn't be any different. Retailers have continually expressed the need for live EBT cards so that we can do just that, test the system. With a live card, store personnel could see the same message prompts that a customer sees and thus be more readily available to identify a problem. A test card would also ensure the accuracy of the computerized food stamp eligible product flags and determine when the EBT key system is reconnected following an outage. We want to ensure the integrity of the program and are more than willing to compensate the appropriate party for the value loaded to the card. We would also be responsible for the security of the card in preventing unauthorized use. Any additional support from this committee is certainly appreciated.
Last but not least is the need to enhance the customer service and reduce the retailer liability in event of a system outage. The EBT system outages present tremendous inconveniences to our customers and significant financial losses to the retail community. There are a couple of areas that need to be addressed to improve that efficiency and reduce our liability.
Page 163 PREV PAGE TOP OF DOC The first is to permit stand-in processing equipment to utilize for EBT transactions, just as it happens in the commercial world. The second is to allow representment of charges made during a system outage or a storing forward processing, as we refer to it in the community.
Some retailers have invested in system upgrades to continue servicing EBT customers when the system is not operational. As a result, the customer is not limited in their purchasing ability during an outage as would be the case if we used a manual voucher. EBT customers would receive the same services under this system as the commercial debit credit card customers. This stand-in processing, or as I say, storing forward processing, refers to the practice of storing the details of a transaction when the system is down and forwarding it for authorization and settlement when the system is again operational. For example, under this scenario, if a customer purchased $20 of grocery when the system isn't working, the store could choose to store and forward the transaction in its system until it is operational. When it comes back on line, we would present the stored transaction with the PIN for authorization.
Currently the issue for the retailer comes when the transaction is declined to an insufficient account balance. In this instance the return message tells us that there is only $10 left, we ask for the opportunity after the customer has left the store to be able to create an adjusted transaction to obtain at least the remaining balance in that customer's account. My company currently engaged in an approved pilot by the FNS in New Jersey to test this process. We have had several outages where we had to go into our storing forward system. We are very pleased with the results so far. We have been able to recapture about two-thirds of the moneys that we would have otherwise lost due to insufficient funds.
Mr. GOODLATTE. Mr. Savner, we have actually gotten more new information from you than we bargained for. Perhaps you could limit it to one more piece of information.
Page 164 PREV PAGE TOP OF DOC Mr. SAVNER. I am summing it up, and I just welcome the opportunity to work with this committee on behalf of the retail community as well as the USDA and anything that we can do to further enhance the implementation of these recommendations.
Mr. GOODLATTE. We very much appreciate your contribution. It is an important part of making this system work that all of the grocery stores and other vendors of food products have a system that they can work with and be happy with and that allows their business to be efficient and profitable.
Let me go back over to Ms. Ryan and ask you, you stated in your testimony that the States need greater flexibility in running the program. I think we are in great agreement about that. I would like to get you to tell me whether you would go for a more liberalized waiver system or would you favor block grants or something else?
Ms. RYAN. Thank you. Thank you for asking. I think what is important, and to be very direct, I think that our association thought about this, we believe that we would strive for greater flexibility in the program without moving to a block grant. The entitlement of food stamps is important, and it reaches many different populations.
With respect to waivers, our experience in many programs has not been all that great, with respect to delays, cost neutrality requirements and waivers, and as I mentioned, for example, the South Carolina demonstration is a waiver to be able to bring elderly people into the program at the Social Security Office. Why should every State have to go through a waiver process when the program resulted in a 31 percent increase in elderly attached to the program, it saved $500,000 in administrative cost, and if it was brought to scale in this country, 500,000 more elderly would be attached to the program tomorrow if we could all do it at the same time.
So we believe that flexibility in the program can be achieved through a broader front end eligibility, a simpler gross income test, more understandable asset and a simplified recertification process. We believe that has been achieved in other programs that are also entitlements.
Page 165 PREV PAGE TOP OF DOC My final point would be to look at the Medicaid Program. It is a quarter of a trillion dollars, and they allow States to do presumptive eligibility where you can at a health clinic make someone presumptively eligible for 45 days until all their paperwork is in. In CHIP they allow States to do passive redetermination, sending notices to families, saying this is the last income we have on record, if it has changed please let us know, consider yourself and your family continuously eligible for the program. There are other programs with bigger experiences.
Mr. GOODLATTE. Thank you. I have to ask other questions.
Ms. Rivero, I was concerned to hear you talk about the fact that the cost of the administration of the EBT system was going up by two to three times what it was a few years ago. I note Virginia is late getting into the process. Has that had something to do with it or what is the reason?
Ms. RIVERO. The only reason our being late has anything to do with it, it just has to do with timing because there is essentially a monopoly in the vendor community, they can charge whatever they want.
Mr. GOODLATTE. Are you using that particular vendor?
Ms. RIVERO. Yes.
Mr. GOODLATTE. Those of you who have been on the system longer, are you using the same vendor, and if so, have you experienced those kind of price increases?
Mr. Friedman, you said you went on line in 1994; is that correct?
Mr. FRIEDMAN. We had a single vendor until we converted in February. We now have three vendors that are doing different parts of the EBT function, the retail and management which is the point of sales, their data center as well as their call centers. So we have three vendors that are now involved. We took the lowest bid.
Page 166 PREV PAGE TOP OF DOC Mr. GOODLATTE. What concerns me is this cocommittee has been concerned about interoperability. One of the reasons we are concerned about it, because Mr. Savner, the companies that his organization represents, we want them to be able to have interoperability so that when customers are going across State lines that the store, particularly smaller stores, don't have to have two or three different machines or two or three different systems to accept different EBT cards with different standards and so on. So interoperability is very important to us, but if that is creat ing a monopolization of the process that is being taken advantage of and raising the cost, we want to know about that too.
Anybody else have any input on this, Mr. Wagstaff, Mr. Howard, Ms. Reinert?
Mr. WAGSTAFF. Well, Mr. Chairman, in California, as an early witness mentioned, we are one of the last States to have gone to EBT as well. We are using the vendor that Virginia is finalizing its contract with or has finalized its contract with. We are finalizing ours, but one of the benefits of going towards the end is that you can learn from what other States have done. One of the things that we are going to be able to do is this question of interoperability, and we will be able to achieve that. We are also going to be able to from other States, in terms of access to points of sale and ATM machines and the types of training you need to do, the types of response systems you need to have as well.
Mr. GOODLATTE. Thank you.
Ms. RIVERO. Mr. Chairman, may I just add?
Mr. GOODLATTE. Sure, absolutely.
Ms. RIVERO. That we really are being helped and especially by our neighboring sister State, North Carolina, who has, in fact, also had their costs rise dramatically, but has been a tremendous help to us in Virginia in bringing the program up. So in fact, the fact that we are later on has helped us get the program up more quickly.
Page 167 PREV PAGE TOP OF DOC Mr. GOODLATTE. North Carolina always helps Virginia. Mr. Savner, let me ask my last question to you. You state in your testimony that there are different application procedures for stores who participate in the food stamp and the WIC Program. Can you elaborate on how these application procedures differ, and do you have any suggestions on how we can streamline that process?
Mr. SAVNER. Yes, I liken the process which we just experienced in the State of New York as akin almost to a scavenger hunt. You are required to get a tobacco license for food stamp authorization, for instance, in some States. It doesn't seem to have any rhyme or reason for that requirement or Health Department inspection in which case we all know the Health Department won't inspect your store until it is ready to open. As I mentioned, I believe, in my testimony, the State of New York is in their WIC update, their computer update. They are having something called the WIC-sis where they are trying to take parts and blend it in with the food stamp application process to avoid the burdensomeness that one finds in the retail community from trying to complete these applications.
Just an anecdotal story we had, with this WIC application which we submitted, was rejected to us and returned because our chairman signed his name Jim instead of James, and that further delayed the process. We wanted to have that authorization in that store for the day we opened in an urban community. So we were left with virtually driving back to the WIC office personally. Those kinds of common sense items, I think, maybe perhaps with the oversight of USDA to help the States streamline an application, which is a requirement certainly, but extraneous things certainly like that are not needed.
Mr. GOODLATTE. Thank you very much. Mrs. Clayton.
Mr. FRIEDMAN. Pardon me, Mr. Chairman I wonder if I could comment on your last question. I thought you might want to know the Department of Health in Texas and the State of New Mexico is entering into a pilot to integrate the WIC Program and EBT, and basically, what we will be doing is taking smart card technology because WIC is prescriptive, and putting it on the same card or same Lone Star card as the magnetic card, so that at the reader at the grocery store would be able to have both benefits delivered through a single mechanism. We intend to go to pilot in the El Paso area sometime within the next year, year and a half.
Page 168 PREV PAGE TOP OF DOC The other thing we are looking at is interoperability, not only among States, but also within the programs within the State of Texas to be using the EBT card for other applications.
Mr. GOODLATTE. That is good to hear. So in other words, the smart card technology allows you to help resolve some of the problems that he has because you will take care of them, and the retailer won't have to worry about answering some of the questions that will be built into the card.
Mr. FRIEDMAN. That is true, and one of the requirements of recent upgrade in our point of sale terminals was to have the capacity to read both magnetic cards as well as smart cards.
Mr. GOODLATTE. Very good. Mrs. Clayton.
Mrs. CLAYTON. That is good to know. I was about to ask a little bit about your experience in Texas in the operation. I remember when we had the floods in North Carolina, we could not to determinethere wasn't a capture in the data in the central office of the total number of people and how much, they had the eligibility. So we had to go back and look at paper rather than use the technology. So is that your reason separating the carded purchase and the operation? What data do you capture in your operation that you do not have on your magnetic card?
Mr. FRIEDMAN. Well, the WIC Program, as I understand, the program is prescriptive, in other words, there is a specific benefit that is authorized unique to an individual's circumstance.
Mrs. CLAYTON. I understand that. I thought you said you had three vendors. And one of your vendors was your central operation, and I am assuming that is for a purpose.
Mr. FRIEDMAN. Right. Within a single vendor there are three major functions. What we simply did was break out those three major functions and offer them to different vendors, and the State served as a system integrator to make sure that all those components were working effectively. Our data center basically is operating with the same software that we had previously used, except that we had modified it in order to accommodate those other two components to make sure that they were coordinated. I'm sorry, I misunderstood your question.
Page 169 PREV PAGE TOP OF DOC Mrs. CLAYTON. No, I misunderstood you. I gather, in North Carolina and Virginia, we have one vendor who is providing all three services where you elected to divide that among three separate vendors. Do you save money in that in Texas? Is that why you do it or the integrity of the program?
Mr. FRIEDMAN. Well, we did it because we believe we will save money, that it is cost avoidance, and that we can control the program. We have found that our cost-per-month basis is actually lower than it was under the single vendor.
Mrs. CLAYTON. Mr. Howard from Michigan, Michigan has a very strong record of serving the working poor families. In fact, you mentioned a little bit that you have tried some of the flexibility, and apparently you had an increase and you found it was not budget neutral, and had, I guess, some penalties as a result of some of the innovation, but actually you actually serve more people. And my understanding now that you had towe are back to a more complicated system. You may be serving less. What do you recommend?
Apparently you say the options don't work because the options aren't really options because it complicates some other things. I wasn't able to discern what they were recommending to us to get out of that kind of bind.
Mr. HOWARD. I have a series of options in the paper, but I think generally when we look atI keep carrying the phrase in my head that Under Secretary Bost used, the layers of policy we have. We have verification upon verification. We have deductions. We have exemptions. And in isolation they do all serve a purpose. They are intended to try to address individual circumstances. But I try and step back and look at that, and my earlier comments about the length of the time it takes to just verify this information, when we have QC workers spending, I think, the average is 20 to 25 hours on a case, but up to 40 hours just to verify if we have done everything right, that tells me no matter how well intended the pieces of policy are, there is just too much there. We would really advocate to looking back on the application, streamlining the application, simplifying the verification, even the eligibility. While this would probably raise some concerns among some groups, we think, for example, a lot of the deductions should either be eliminated or consolidated, so we aren't doing independent verifications and independent analysis of things like the whole range of things.
Page 170 PREV PAGE TOP OF DOC As I mentioned, conceptually I started the thought that a family has a food need, that they should contribute a portion of their income towards food and the gap is the need for, example, in the Food Stamp Program. That would be my suggestion for a starting point. From there you will have a number of public policy debates around to do that. Would it be to keep costs neutral? There would probably be some people who lost some benefits if you didn't address the deduction, should you throw in a shelter deduction, should you throw in others? But I think if we start from the current program and try and work backwards, we aren't going to peel back the layers that cause our staff to focus on quality control that I do think frustrates families.
We have seen a fairly significant drop over the decade in food stamp families. Interestingly enough, we are up about 30,000 households since last fall, so they are starting to come back in. We have done some outreach over the last year. Cause and effect, I don't know, I think there is some. I really think you have to start from the ground up and not think about what are the one or two things we can tweak here.
Mrs. CLAYTON. Ms. Ryan, I want to agree with you that we really do need to provide some reform. I also want to raise a disagreement. I see the red light came on, so I am going to do this very fast. My concern is I thought you had, as one of your recommendations for the elderly as an option, to give cash rather than food, and if I misunderstood that I apologize, but I thought your crossword document recommends replacing food stamp benefits for the elderly and disabled with a cash payment. Did I misread that?
Ms. RYAN. Thank you for the opportunity to just respond to that. We are not recommending a cash out of benefits . That is an unfortunate phrase in our recommendations. We are simply saying that they should be attached to the program at the Social Security Office. They can then be sent or issued an EBT card to be able to ensure that those dollars are used for food and nutrition needs, and it was an unfortunate error that will be correct in our crosswords document, because we think it is a terrific idea; but unfortunately, the thought of cash out, of course, raises a lot of concerns, including those of our members, so we apologize and appreciate the opportunity to clarify.
Page 171 PREV PAGE TOP OF DOC Mrs. CLAYTON. Well, the connection between farm and the program would be severed if it became a cash to do anything. This is connected to nutrition and the producers and the recipients of food stamps have this umbilical cord which would be severed if we gave cash back.
Mr. Chairman, I yield back.
Mr. GOODLATTE. Thank you very much. The gentleman from Puerto Rico, Mr. Acevedo-Vilá.
Mr. ACEVEDO-VILÁ. Thank you, Mr. Chairman. I have some questions to the State administrators. As you move to implement the EBT system, how do you deal with the small mom-and-pop shops and the farmer markets? Any of the State administrators.
Ms. RIVERO. I will be happy to address, since we are going through that right now in Virginia. The smaller mom-and-pop type of food retailers who may not currently be using debit card technology will be supplied the devices so that they can use them for the EBT program.
Mr. ACEVEDO-VILÁ. Supplied by the State?
Ms. RIVERO. That is correct, we will supply those devices.
Mr. HOWARD. The same is true in Michigan. If they cannot use their current equipment or retrofit it, the equipment will be supplied. In addition, through our contractor we are trying to aggressively reach out in the way of training, not just on what is the equipment but how to use it because some of the mom-and-pop operations may literally have less than $1,000 in benefits a month, so it is not someone going through and swiping food all the time. So there is a training aspect as well.
Mr. FRIEDMAN. The farmers markets pose a specific problem in that often there is not the infrastructure to support it. I know there are two States, I think, New York and Florida are experimenting with cellular technology in terms of doing that. We would have a problem in doing that in Texas because cell phones don't work in many parts of our State. What we would do is resort to manual vouchers.
Page 172 PREV PAGE TOP OF DOC Mr. ACEVEDO-VILÁ. Thank you. Instead of the requirements of the programs, am I correct in saying that the maximum income level is about $1,500 a month for a family of three, and the maximum benefit will be something like $350, is that correct?
Mr. HOWARD. That's sounds pretty close.
Mr. ACEVEDO-VILÁ. I have a political question. What will be the consequences if the income level would be reduced to $500 a month and the benefit reduced to $268 a month? What impact will it have over your clients.
Mr. HOWARD. Well, I think one of the difficulties would be for the gap that have lost benefits or some, you are hearing kinds of two sides of testimony today. I agree with both. One, I think there is an important aspect that we promote employment, push work and build tighter, tougher work expectations and not for everyone, but even aligned with that concept is the thought that food stamps can serve as a transition as people come off the other programs. We do not want it to be a forever program. Some people need to rely on it long term and that is fine, but to the extent they can move off quickly, we want them to, and if it provides 2 months, 3 months, 6 months, 8 months of cushion that allows them to stabilize their employment, you might have some risk in that area, losing that ability to stabilize their individual circumstances.
Mr. ACEVEDO-VILÁ. Well, it is not really a political question. Just look at the numbers for Puerto Rico in terms of the income and benefits, that is something that really concerns me.
To Mr. Savner, are you familiar with the Puerto Rican Nutritional Assistance Program, the program we have in the island?
Mr. SAVNER. I am vaguely familiar with it just based on some of the conversation I have had with people from FMI.
Page 173 PREV PAGE TOP OF DOC Mr. ACEVEDO-VILÁ. What is the FMI's position to this program.
Mr. SAVNER. I believe the industry feels that the benefits should be directed towards the purchase of food. We support that being the goal of program as opposed to similar to the way it is in the United States.
Mr. ACEVEDO-VILÁ. OK. Thank you.
Mr. GOODLATTE. Thank you. Well, folks, it has been a very enlightening day. And I appreciate all you coming from all parts of the country to help us with this. We hope to be able to implement some significant reforms in the Food Stamp Program as we move forward with the farm bill, which we hope will be this year and your input has been very helpful.
We will keep the record open so you can submit additional information, and I have some magic language to get us out of here. The Chair would seek unanimous consent to allow the record of today's hearing to remain open for 10 days to receive additional material and supplementary written responses from witnesses to any question posed by a member of the panel. Without objection, it is so ordered and this hearing on the Subcommittee on Department Operations, Oversight, Nutrition and Forestry is adjourned.
I apologize. Mrs. Clayton wants to say something and we will reconvene.
Mrs. CLAYTON. I just wanted to acknowledge your presence and to express an apology for having to leave this important hearing and test our chairman's endurance here. But I thank you very much for coming, but I was called to the Rules Committee, but you can't be two places at the same time. I want to thank you to join him in thanking you for being here and for making this hearing a significant one. Thank you.
Mr. GOODLATTE. Thank you. The hearing is adjourned.
[Whereupon, at 5:12 p.m., the subcommittee was adjourned, subject to the call of the Chiar.]
Page 174 PREV PAGE TOP OF DOC [Material submitted for inclusion in the record follows:]
Statement of Hon. Tony P. Hall, a Representative in Congress from the State of Ohio
Chairman Goodlatte, Ranking Member Clayton and other members of the committee, I thank you for holding this hearing on the Food Stamp Program. I applaud this committee's commitment to investigate and close the gap between food stamp eligibility and participation that so many studies are reporting. Over the past 17 years of fighting hunger in Congress, I have met many families struggling to survive. We know that 31 million Americans are threatened by hunger each year, according to the US Department of Agriculture, and despite what critics claim, the Food Stamp Program is an effective tool in feeding these families. It is a simple solution that works. Food Stamps are not the only solution, but a significant part of the comprehensive strategy to end hunger. However, even solutions like the Food Stamp Program need adjusting as times change. As part of the next farm bill, we have an opportunity to update the program so that more hungry Americans are served.
OVERVIEW OF PARTICIPATION IN THE FOOD STAMP PROGRAM
The Food Stamp Program is the cornerstone of the USDA nutrition assistance programs. It provides electronic benefits or coupons that can be exchanged for food at qualified retail food stores. This translates into supporting millions of families going through rough times until they can stand on their own again. It also supports our food producers, processors and suppliers.
However, participation in the Food Stamp Program has declined 34 percent over the past four years the decrease is four times the decrease in the poverty rate during the same period, leaving more than 2 million people in poverty and without food stamps. In addition, USDA estimates that 6.1 million adults and 3.2 million children lived in households that experienced hunger in 1998. Some of the recent drop in caseloads is a result of the 1996 welfare law that excluded substantial groups from participation in food stamps. Some is due in part to the growing economy and lower unemployment. Most of the drop is due to states'' unwillingness or inability to get food stamps to eligible families, especially working families.
Page 175 PREV PAGE TOP OF DOC The Food Research and Action Center published the ''State of the States'' report which profiles the status of Food and Nutrition Programs Across the Nation. In my home State of Ohio, it is estimated that only 5364 percent of eligible persons are participating in food stamps. According to the USDA, 80 percent of food stamp benefits go to households with children and senior citizens. The average length of participation is less than two years, and half of all new recipients stay in the program less than 6 months. This program can serve as a true safety net for families that experience short periods of financial difficulty.
It is time for us to ensure that eligible people in need receive the benefits to which they are entitled. One initiative in this Congress would not solve all of our problems, but it is a significant step in the right direction. I am proud to cosponsor, with Eva Clayton and Jim Walsh, the Nutrition Assistance for Working Families and Seniors Act, HR 2142, which would achieve the following:
Restore Food Stamp Eligibility for Needy Legal Immigrants
Increase Benefit Allotments for Families with Children
Raise Minimum Food Stamp Benefit to $25
Treat Child Support Income Favorably
Expand State Option for Transitional Food Stamp Assistance
Improve Food Stamp Access, and
Bolster the TEFAP Program
These items, along with those from the Hunger Relief Act that passed last year, are steps in the right direction.
THE ELDERLY AND FOOD STAMPS
One population that we need to pay special attention to are senior citizens. Only a small number of the elderly are enrolled in the Food Stamp Program. In FY 1999, only 20 percent of all households enrolled in Food Stamps contained an elderly member. There are multiple reasons for the lack of participation from this population. There are perceived problems with program administration and the stigma in regards to public assistance. However, the most important problem that needs to be solved is the low minimum benefits.
Page 176 PREV PAGE TOP OF DOC Currently, one and two person households that are eligible for food stamps are assured a minimum benefit of only $10 - an amount that has not changed since 1977. In FY 1999, single person elderly households average $46 a month in Food Stamp benefits. HR 2142 raises the minimum food stamp benefit to $25 a month. I think it should be a minimum of $50 per month and ideally around $75, but there is no question that it needs to be increased. Seniors on a fixed income, due to SSI or Social Security, typically have large medical bills and require expensive prescription drugs. Food is the first item eliminated from a budget, but the most important for the elderly and ill.
One 84-year-old woman, Barbara, from Lima, OH shared her opinion on the Food Stamp Program while waiting for food at a pantry. ''I was eligible for $10 a month in Food Stamps and it wasn't worth it. It's a 1620 mile distance to the department and I don't have transportation. And I could never keep up with the paperwork.'' Barbara lives alone and has never gotten a driver's license. Barbara lives off of her late husband's Social Security, but her health has declined and medicine has taken priority over food. The burden of the food stamp application process needs to reap larger benefits than $10 for Barbara to feel it is worth her time and effort.
Darryl and Martha Wagner, another Ohio couple that I've met, receive about $1,000 per month in retirement and Social Security. He is 70 years old and she is battling cancer. After applying and being denied three times, they were finally informed that they were entitled to receive $10 per month in food stamps. They decided it was not worth the cost, time and effort to recertify every three months for a measly 33 cents per day.
Currently there are special rules for the elderly, including medical expense deductions and a 24-month certification period, but the bottom line for many is the minimum allowable benefits. With HR 2142, we have an opportunity to show Barbara, the Wagners and other eligible seniors that the Food Stamp Program is worth the effort and a key element in maintaining their health and quality of life.
Page 177 PREV PAGE TOP OF DOCWORKING FAMILIES AND FOOD STAMPS
With the onset of welfare reform, TANF recipient caseloads have decreased. There is growing research that shows a correlation between the decreased TANF roles and decreased Food Stamp roles. There is a push by welfare staff to divert clients from all assistance programs. As a result these same families are not taking advantage of non-cash programs for which they are still eligible, such as Food Stamps.
The Urban Institute study finds that 33 percent of former welfare recipients have to skip or cut meals due to lack of food. America's Second Harvest reports that one in five people in a soup kitchen line is a child. Over half of food stamp recipients are children aged 17 and under, according to FRAC. Thirty-four percent of children on the program are preschool age (under age 5). The current Food Stamp Program counts child support as earned income. In HR 2142, 20 percent of the child support income is disregarded and treats child support favorably. In addition, by indexing the food stamp standard deduction and scaling it to family size, this bill makes important improvements in the adequacy of benefit levels, especially low-income families with children.
Through HR 2142, Food Stamp Outreach Programs are supported and The Emergency Food Assistance Program is increased. The need for emergency food has increased by 1520 percent over the past year according to the network of food providers. The demand is too high for the non-profit faith-based organizations to meet on their own. Allowing funds to be used for outreach, we can identify eligible people in their own neighborhoods. In Cleveland, Ohio, the foodbank system has partnered with the Food Stamp Office to outstation eligibility workers in member agencies. Gestures like these will aid in the depletion of the stigma and meet the need of hungry people across the Nation.
I am pleased that you have recognized the need for increasing TEFAP, Chairman Goodlatte, and am proud to join you in supporting the Emergency Food Assistance Program Enhancement Act. I commend this subcommittee for holding hearings on this program and seeking to assist emergency food providers with USDA commodities and resources to store and distribute this necessary food.
Page 178 PREV PAGE TOP OF DOC I would like to share with you one final story of a family in Columbus, Ohio.
On October 1, 2000 welfare reform time limits hit in Ohio. One family a single mother with four children was in jeopardy of losing her cash assistance. The children were too young for school and mom couldn't find a job that paid enough to afford childcare. She thought she was losing all her benefits when her cash assistance ran out. This helpless mother felt her only option was placing her children up for adoption. She shared this idea with local advocates and they immediately stepped into action. The advocates worked with her to apply for food stamps, childcare assistance, and job training. The mother was able to keep her children and move toward self-sufficiency.
Thanks to food stamps, millions of families are able to support themselves and maintain health and dignity until they can once again become self-sufficient. The Food Stamp Program is the cornerstone to USDA's anti-hunger safety net. Through HR 2142, we are creating opportunities for families to receive the nutritious allowances necessary for a healthy life.
Once again, thank you Chairman Goodlatte, Representative Clayton and other members of this committee. I applaud your efforts to enhance the Food Stamp Program and to work towards an end to hunger in our country.
Statement of Claryce H. Nelson
Good afternoon Mr. Chairman, Ranking Member Clayton, Members of the committee and guests. On behalf of AARP, thank you for this opportunity to present the views of the Association regarding reauthorization of the Food Stamp program (FSP). I am Claryce H. Nelson, AARP Washington D.C. State Coordinator for Consumer Issues. AARP applauds the committee's timely efforts to review the Food Stamp Program and related nutrition programs before the current authorization expires next year. Early committee action is essential if careful consideration is to be given to the numerous issues that have arisen since the last reauthorization.
Page 179 PREV PAGE TOP OF DOC A 2000 GAO report noted that about 1.6 million to 2 million households with individuals age 60 and older lacked enough of the right types of food needed to maintain their health or simply did not have enough to eat. It further noted that, in some cases, older persons are forced to choose between buying food or paying for medicine, utilities, or other needed items. Approximately 500,000 to 600,000 older persons reduced their food intake to the point that they experienced hunger. Yet the majority of older persons who are eligible for the Food Stamp Program fail to receive its benefits benefits that could help to alleviate these problems.
The FSP continues to be a well-targeted nutrition program designed to help eligible recipients maintain a healthy diet. The primary households served are those with children under age 17, older persons and persons with disabilities. A 2000 Department of Agriculture report on characteristics of FSP households notes that over half of recipients are children. Twenty percent of participating households contain seniors, while 27 percent contain disabled individuals.
The USDA report affirms that the program continues to focus on supplementing food purchases among the poorest in our society. It notes that even if the cash value of FSP benefits were added to the gross income of beneficiary households, only about 17 percent of them would move from below half the poverty line to above half the poverty line. Only 7 percent would move out of poverty. As intended, the program is genuinely responsive to changes precipitated by economic cycles and natural emergencies.
However, the welfare reform changes of 1996 caused major reductions in participation rates that underscore the persistence of unacceptable levels of hunger and food insecurity. While participation in the FSP has declined by 34 percent, there has been no corresponding decrease in poverty; in fact, the number of persons in poverty and without food stamps increased by over 2 million between 1996 and 1999. Despite the benefits of encouraging greater self-sufficiency, removing some actual FSP abusers and discouraging some potential abusers, changes resulting from the 1996 welfare reform laws call for reassessing its effects on FSP beneficiaries.
Page 180 PREV PAGE TOP OF DOC According to USDA estimates, only about 30 percent of eligible elderly individuals participate in the FSP - less than half the overall participation rate of 63 percent. The aforementioned 2000 GAO report surveyed State food stamp program administrators in 51 States. Among the many reasons cited for poor participation by the elderly, officials most frequently reported that the burdensome application process can outweigh the expected benefit for some older persons. For example, the GAO examined one application form in which the food stamp section alone was 15 pages long.
he level of need among households with children is clearly greater than among other population groups, and AARP strongly supports legislative and administrative strategies to address that need. It is a fact, however, that many who are eligible for food stamps, but not receiving benefits, are older individuals. While most of my remarks will focus on the older constituency, they should not be construed as suggesting that AARP endorses or supports benefits for any eligible population at the expense of another.
While there are numerous issues that deserve attention, AARP will limit today's remarks to three general areas of need:
Improving access to Food Stamp information and simplifying the FSP application;
Increasing the minimum FSP benefit; and
Providing child-only FSP benefits for children under non-parental care.
IMPROVING ACCESS TO FOOD STAMP INFORMATION AND SIMPLIFYING THE FSP APPLICATION
The FSP has always played the primary role in providing nutrition assistance to, and maintaining an adequate diet among, eligible households suffering from hunger and food insecurity. Not surprisingly, the problems of hunger and food insecurity are most severe among people with low incomes, people in poor health and minorities. Older persons are significantly represented in each of these categories. A recent AARP Public Policy Institute Issue Brief, ''The Food Stamp Program and Older Americans,'' noted that the participation rate among older persons was a very low 30 percent of eligible households in 1998 compared to 69 percent for children. It further noted that the participation rate among eligible children had declined sharply from 86 percent in 1994 as a result of welfare reform. Studies show that the primary reason for low participation among seniors is their belief that they are ineligible. In contrast, lower participation among children results from the combined effects of policy changes and inadequate information available to heads of households, since children do not make these decisions. AARP urges Congress to increase FSP authorization levels, recipient benefits and outreach efforts to ensure nutritional adequacy for all of the Nation's vulnerable poor.
Page 181 PREV PAGE TOP OF DOC Many eligible households do not seek FSP or other public assistance benefits because of the immense complexity and volume of associated paperwork. But were the paperwork not an issue, the rules that govern processing of applications would still create barriers to participation by eligible households. A case in point pertains to the definition of ''household.'' Householdsnot individualsreceive food stamps. Current regulations that define what constitutes a ''household'' eligible for food stamps can have the effect of discriminating against extended families that live together out of economic necessity. For instance, two widowed sisters with low incomes who share a home and purchase and prepare their food together are considered one household. Because the Food Stamp Program considers their combined incomes when determining eligibility for benefits, they may have difficulty qualifying for food stamps or may receive less in benefits than if they lived separately.
In some States, Federal guidelines defining ''household'' have been misinterpreted to deny food stamps to eligible persons. More direct barriers to adequate assistance result when the definition of household limits available benefits based on the number of children rather than need. AARP urges making statutory changes in the FSP definition of ''household'' so that eligible families and extended families more easily qualify for and receive adequate benefits.
The recent changes in Federal provisions for the FSP also affected administration of the program by the States. In the past, Congress established a number of program administration requirements to facilitate access to the Food Stamp Program by older people and people with disabilities. The 1996 welfare reform law repealed several of these requirements. States are permitted, but no longer required, to conduct telephone interviews or home visits instead of in-person interviews, to take applications over the phone or by mail, and to issue food stamps by mail in rural areas. Under the 1996 welfare reform law, each State is directed to establish procedures governing the operation of food stamp offices that the State determines will best serve households, including those with special needs. States should use their flexibility to encourage rather than discourage participation by eligible households. Important areas to be addressed might include the environment established within FSP offices (e.g., quality of client service), the application process, assistance to applicants and ultimately the manner in which benefits are delivered.
Page 182 PREV PAGE TOP OF DOC Electronic benefits transfer (EBT) cards provided for receipt of payments offer still another example of participation barriers. EBT systems provide a food stamp ''debit card'' that is used in lieu of paper coupons. While such debit systems have some potential for reducing food stamp theft, they also pose many potential problems for beneficiaries. For example, consumer choice of retail outlets may be reduced because stores are not required to install EBT terminals. While these terminals are common in major supermarkets, they may be less accessible in smaller stores. In addition, food stamp recipients could be stigmatized because retailers are allowed to segregate them into special lines equipped with the EBT terminals.
Unfortunately, the evaluation of EBT pilot projects inadequately sampled older participants, which is particularly important because many older individuals are reluctant to use unfamiliar technology. Recipient disabilities, recipient difficulty with technology, and the limitations EBT cards can impose on the choice of retailers in many areas - all of these can impede access to the program. While we hope that the barriers presented by these cards will eventually disappear, steps can be taken now to reduce them. AARP believes that implementation of electronic benefit transfer systems should be flexible to accommodate the special circumstances of beneficiaries who are elderly, have disabilities, or live in rural or inner-city areas that are served by participating institutions. Federal law requires that States issue food stamp benefits through EBT systems by October 1, 2002, unless the hardships involved with implementation qualify the State to obtain a waiver.
INCREASING THE MINIMUM FSP BENEFIT
Food stamp benefits are based on a formula called the Thrifty Food Plan (TFP). Because the TFP has been artificially constrained to reduce its cost, food stamp benefit levels have shrunk relative to actual food costs for nearly all low-income households. For fiscal year 2001, the maximum monthly food stamp benefit for a single person is $130. AARP urges that the Thrifty Food Plan be revised to account more accurately for the actual food costs of low-income households.
Page 183 PREV PAGE TOP OF DOC
The minimum food stamp benefit, currently $10 a month, helps make program participation available to one- and two-person households with incomes just above the poverty guidelines. As part of welfare reform, Congress repealed a scheduled increase to $15 and indexing of the minimum benefit before that increase took effect. This loss of increased benefits particularly affects older people because more than half (57 percent) of the households that receive the minimum benefit include an individual over age 60.
Among the 1.7 million older individuals who received food stamp benefits in 1999, the average household benefit level was $61 a month. Twenty-eight percent of elderly food stamp households (those containing a member age 60+) received the program's minimum benefit of $10 per month. The current $10 minimum benefit has not been adjusted for inflation since 1977 although food prices have increased over 150 percent. Further, the minimum benefit amount is so meager as to discourage many eligible individuals from applying for benefits or re-certifying their eligibility for benefits. In extremely rural areas, this effort can impose significant hardship, especially considering transportation costs and the limited transportation alternatives. One solution AARP has recommended is permitting households eligible for minimum benefits to receive them in quarterly installments rather than traditional monthly allotments.
In the 2000 GAO report on options for improving nutrition assistance for older persons, nearly all of the State food stamp directors endorsed increasing the minimum benefit level from $10 to $25 per month. Of the 50 respondents to this question, 94 percent said that this change should be a high priority. AARP strongly believes that Congress should increase the minimum FSP benefit and restore indexing of the minimum benefit to inflation.
SEPARATING FSP HOUSEHOLDS FOR CHILDREN UNDER NON-PARENTAL CARE
The final topic we would like to address specifically concerns children raised by grandparents or other family caregivers. This is a growing financial concern, especially for those on very limited incomes. Maternal grandmothers, in particular, are playing an increasingly important role in family well-being, especially in poor and working-poor families. The Census Bureau estimates that in 1997 there were approximately 792,000 households in which grandparents were raising grandchildren with neither parent present. According to an earlier Census report, the median age of grandparents raising grandchildren is 57. The median age of grandparent caregivers age 65 and older is 70, a group that accounts for 23 percent of grandparent caregivers. The majority of grandparent caregivers (68 percent) are white, while 29 percent are black. Twenty-seven percent of mid-life and older grandparent caregivers live at or below the poverty level; another 14 percent live between 100 percent and 150 percent of the poverty level.
Page 184 PREV PAGE TOP OF DOC Current food stamp rules make it difficult for grandparents and other caregiver-relatives to obtain food stamps on behalf of children in their care. Children who are younger than 18 and under the control of an adult who is not their parent are automatically treated as a member of that adult's household. No one in a household can qualify for food stamps unless all members of the household are eligible to receive them. As a result, grandparents and other caregiver-relatives who are ineligible for food stamps cannot obtain benefits solely on behalf of a child.
Few grandparent or caregiver households receive any type of child support payments for these dependent children. AARP believes that when child support payments are available, eligible grandchildren should not be unduly penalized under the FSP. Many such grandparent and caregiver households are likely to need extra cash assistance to help defray the expenses of raising grandchildren. AARP urges Congress to amend the FSP to allow grandparent and other nonparental caregivers the option of applying for food stamps on behalf of the children in their care. Further, we believe that public benefit programs should maximize the support given to grandparent-headed families and other caregiver relatives to encourage and keep intact families with dependent children.
In conclusion, Mr. Chairman, AARP applauds the committee's timely efforts to review this important statute. The FSP assists so many poor households that would otherwise face almost certain nutritional risk and hunger. The recommendations that we have made today by no means address all of the critical concerns regarding this complex program. We do believe, however, that our recommendations, if enacted, would help to close many of the serious gaps in service to the intended population. AARP stands ready to work with Congress and the administration to bring about the needed improvements.
Statement of Eric M. Bost
Page 185 PREV PAGE TOP OF DOC Mr. Chairman and Representative Clayton, it is a pleasure to see both of you again. I appreciate the opportunity to join you today to discuss the reauthorization of the Food Stamp Programto build on its history of success to meet the demands of this new century.
Nearly 4 years ago, then-Governor George Bush appointed me Commissioner of the Texas Department of Human Services, one of the Nation' largest human services agencies. With an organization of more than 15,000 employees and an annual budget of $3.5 billion, I was responsible for administering State and Federal programs that served more than 2 million needy, aged, or disabled Texans each month. I took that position after more than twenty years of experience in managing human services agencies across the country.
When President Bush and Secretary Veneman asked me to join the team at the Department of Agriculture, I was extremely pleased to have the opportunity to put my experience at the State and local levels to work in managing and improving the Federal nutrition assistance programs. I particularly looked forward to representing the administration in the process of reauthorizing the Food Stamp Programthe foundation of the Nation's nutrition safety netas part of the farm bill. I believe that my knowledge and experience prepare me well for this challenge. I look forward to working with this subcommittee as we develop a reauthorization approach that both preserves those aspects of the program that have served this country so well over the past decades, and makes the changes needed for the program to function even more effectively and efficiently into the future.
I would like to begin today with a brief review of the Food Stamp Program's current status, and then describe some of the changes in the program's performance and operational context that resulted from welfare reform, before outlining my thoughts about aspects of the program that could be improved during reauthorization.
A History of Success
Page 186 PREV PAGE TOP OF DOC In my view, the Food Stamp Program stands as a testament to our country's compassion. For over 30 years, it has served as the first line of the Nation's defense against hunger, a powerful tool to improve nutrition among low-income people. Any discussion of food stamp reauthorization must start with recognition of the strong evidence that the Food Stamp Program works to reduce hunger and improve nutrition in America.
It touches the lives of millions of people who need a helping hand to put food on the table. Unlike most other assistance programs, the Food Stamp Program is available to nearly anyone with little income and few resources, serving low-income families and individuals wherever they live with food-based benefits that increase a household's food expenditures, and its access to nutritious food.
Because food stamps are not targeted or restricted by age, disability status, or family structure, recipients are a diverse group, representing a broad cross-section of the Nation's poor. In 1999, over half of all food stamp recipients (51 percent) were children, 9 percent were elderly, and another 9 percent were disabled. Many recipients worked, and the majority of food stamp households were not on Temporary Assistance for Needy Families (TANF). However, most food stamp households had little income and few resources available to them. Only 11 percent were above the poverty line, while 35 percent had incomes at or below half the poverty line. About two-thirds of all households had no countable assets. The program is clearly successful at targeting benefits to the neediest Americans.
The Program responds to economic changes, expanding to meet increased need when the economy is in recession and contracting when the economy is growing, making sure that food gets to people who need it. Because benefits automatically flow into communities, States, or regions of the country that face rising unemployment or poverty, the program tends to soften some of the harsher effects of an economic downturn.
However, over the last decade, food stamp participation rose more sharply than expected during the relatively short and mild recession in the early 1990's and then fell more sharply than expected after 1994 during the sustained period of economic growth. In March 2001, the program served 17.3 million people, down from 28 million at its peak in March 1994. In recent months, the participation decline has slowed, and may have ended; over half of all States are now serving more people than they did a year ago. It is important to note that as participation has declined, program costs have also dropped considerably; annual costs have declined by over $7 billion since fiscal year 1995.
Page 187 PREV PAGE TOP OF DOC The program delivers billions of dollars in benefits with a high degree of integrity and accountability. The vast majority of program benefits go only to households that need them. In 2000, about 6.5 percent of program benefits were issued in excess of the correct amount; an additional 2.4 percent should have been issued to recipients but were not. The combined overall payment error rate of 8.9 percent represents the lowest rate of overall error in the program's history. We are doing well, but further improvement can be made.
In 2000, 98 percent of households that received food stamps were entitled to some benefit. Problems tend to occur far more frequently in cases where an eligible household is provided with the wrong amount of benefits. Difficulties in determining the correct level of benefits stem from a number of factors: the intricacy of program rules designed to target benefits precisely, the complex circumstances of working families, and the need to anticipate the circumstances of program participants.
When errors resulting in overpayments do occur, the Department works hard to recoup these funds from those who receive them. In partnership with the States, there are a variety of tools that support this effort, such as recoupment from active benefits, voluntary repayments, referrals to collection agencies and offsets of State and Federal payments. In fiscal year 2000, $223.8 million was collected through these mechanisms. By far, the most successful tool is offset of Federal payments, currently accomplished in partnership with the Department of Treasury through the Treasury Offset Program. The Food and Nutrition Service has been a leader among Federal agencies in this effort.
The period since the program was last reauthorized has seen a revolution in the way that Food Stamp benefits are delivered. In 1996, Congress set a deadline to have all food stamp benefits delivered through Electronic Benefits Transfer, or EBT, by October 1, 2002. At that time, only about 15 percent of benefits were delivered electronically. Today, 80 percent of all benefits are delivered through EBT. Forty-three State agencies now operate EBT systems for the Food Stamp Program and forty-one are statewide. The Department is aggressively working with staff from the remaining State agencies to accomplish the goal of converting to electronic delivery.
Page 188 PREV PAGE TOP OF DOC I am pleased to inform Congress that interoperabilitythe ability to redeem EBT-based benefits across State lines' is a reality today among all but a few States. The remaining few States are either using smart card systems that are incompatible with on-line technology or are working to overcome the technical and contractual issues that must be in place before interoperability can occur. These issues are well understood by the States and the EBT industry. The Department strongly supports the efforts underway to address them.
One of the benefits of the move to electronic benefit delivery is that it provides new tools in the fight against food stamp trafficking; electronic transaction data are systematically analyzed and used to identify violations, and we continue to refine our use of the data. While the extent of trafficking food stamps for cash is estimated to be less than 4 cents of every dollar issued, we must continue to be vigilant and to improve our ability not just to redress trafficking and other kinds of fraud, but to ensure that only eligible stores participate in the program.
USDA focuses significant effort in this area. New stores are subject to an on-site visit to assure that the store meets the eligibility criteria for authorization. Owners and managers are provided orientation and training on the use of food stamp benefits for eligible foods. And, stores are subject to periodic revisits to assure that they continue to meet eligibility criteria. The Department measures its success in this area by annually visiting a random sample of participating stores and establishing a statistically-valid Store Eligibility and Accuracy Rate (SEAR). The most recent SEAR results, for fiscal year 2000, show our success: 98.5 percent of all participating stores were, in fact, eligible to participate.
Ensuring effective stewardship of the taxpayer investment in this program is one of the Department's most important responsibilities. I know you will hear from the Inspector General later in this hearing; I look forward to working closely with him in the coming months to develop proactive strategies to ensure that the Department prevents fraud and abuse before it occurs.
Page 189 PREV PAGE TOP OF DOC The Changing Environment Since Welfare Reform
As I have mentioned, much has changed since Congress last reauthorized the Food Stamp Program. Increasing food security, ending hunger, and improving nutrition among low-income families and individuals remain central to the program's mission. Yet the challenges facing the program todayand the pace of change in the world in which it operatesare substantial.
Welfare reform transformed social policy for low-income families, replacing an entitlement to cash assistance with a system that requires work in exchange for time-limited assistance. The 1996 welfare reform law (i.e. the Personal Responsibility and Work Opportunity Reconciliation Act of 1996) has been a great success in moving people from dependency to self-sufficiency. Between January 1996 and June 2000, the welfare caseload fell by over 50 percentthe largest welfare caseload decline in history and the lowest percentage of the population on welfare since 1965. And significant numbers of those have left welfare for work.
In important ways, States have been the leaders of this revolutionary effort and are responsible for its success. State governments made use of the flexibility provided in the 1996 law to develop innovative efforts to restructure their welfare programs to require work, time-limit assistance, improve child support enforcement, or encourage parental responsibility.
The Food Stamp Program has also contributed to the success of welfare reform by supporting the transition from welfare to work. The reasons are easy to understandif you are worried about your family's next meal, it is hard to focus on your future. For many households, food stamps can mean the difference between living in poverty and moving beyond it. And for many, it has. Welfare rolls, and the proportion of food stamp households on welfare, have fallen sharply, while the percentage of food stamp households with earnings has grown. Today, there are as many working families as there are welfare families on food stampsroughly a quarter of all participating households. Now, more than ever, the Food Stamp Program plays a critical role in easing the transition from welfare to work.
Page 190 PREV PAGE TOP OF DOC Food stamp participation has fallen dramatically. As I mentioned earlier, the Food Stamp Program served 17.3 million people as of March 2001, nearly 11 million fewer than at its peak in March 1994. Part of the decline is explained by a strong economy, the success of welfare reform in moving people into jobs, and restrictions on legal immigrants and unemployed adults. But other factors may also be at work. The percentage of people eligible for food stamps who actually participated fell 11 points between 1994 and 1998. In 1998, about 59 percent of those eligible for benefits received them, roughly the same level seen in the late 1980's. Working poor families and elderly people continue to participate at rates well below the national average.
Concerns have grown that the program's administrative burden and complexity are hampering its performance in the post-welfare reform environment. There is growing recognition that the complexity of program requirementsoften the result of desires to target benefits more preciselymay cause error and deter participation among people eligible for benefits. For example, households are required to provide detailed documentation of expenses for shelter, dependent care, medical expenses, and child support. Similarly, the law requires that most unemployed adults without children should only receive food stamps for a limited time and most legal immigrants should not receive food stamps at all. However meritorious the intent of this policy, provisions of this kind require applicants to provide additional information, introduce new rules for caseworkers to follow, and impose costly and potentially error-prone tracking requirements on State agencies.
These burdens are particularly significant for the working families that comprise an increasing portion of the Food Stamp caseload. Caseworkers are often expected to anticipate changes in their income and expensesa difficult and error-prone task, especially for working poor households whose incomes fluctuateand households are expected to report changes in their circumstances to ensure that each month's benefit reflects their current need. Such burdensome requirements may discourage working families from participating in the program. They also make the job of State agencies, that must serve these working families effectively while delivering benefits accurately, significantly more difficult.
Page 191 PREV PAGE TOP OF DOC Finally, there is growing awareness that we need to reform the quality control system to ensure that it more effectively encourages payment accuracy without discouraging States from achieving other important program objectives. The existing quality control system provides timely and accurate data on State performance in issuing the correct amount of benefits, as well as other valuable program information. Establishing sanctions against any State with a higher than average error rate is a source of serious and continuing friction with States. Sanctioning approximately half of the States each year does not contribute effectively to productive partnerships that can achieve the program's objectives. In addition, there is growing concern that the system discourages States from achieving other desired program outcomes; such as program access. My view is that every person eligible to receive food stamps should have full and easy access, while maintaining integrity in the program. We need to re-examine how the Food Stamp Program recognizes and supports its multiple program goals.
FOOD STAMP REAUTHORIZATION: A FRAMEWORK FOR THE FUTURE
The administration considers the Nation's nutrition assistance programs a critical source of food for low-income adults and children. It strongly supports reauthorization of the Food Stamp Program, as well as the other important nutrition programsThe Emergency Food Assistance Program (TEFAP), the Food Distribution Program on Indian Reservations (FDPIR), and the Commodity Supplemental Food Program (CSFP)that are important components of the farm bill.
You have asked me to focus today on the administration's proposal for reauthorization of the Food Stamp Program. As you know, my tenure in this position has just begun, and we are just starting a process to develop our reauthorization proposals. I am eager to work with Congress as these proposals are developed to make program improvements that will address the challenges, and the changing policy environment, that I have described. Today, I would like to identify and describe some general areas of interest that we expect to explore in developing the administration's proposal:
Page 192 PREV PAGE TOP OF DOC Supporting Work: Food stamps can serve as a critical support for the transition to work and self-sufficiency. But working families often have circumstances that make complying with the program's procedural requirements more difficult. We need to explore changes to make the program work better for working families, facilitating their access to the benefits they need while minimizing burdens for State agencies.
Simplifying Program Rules: There is broad agreement that the program has grown too complicated. The consequences of this complexity for State and local program operators and, more importantly, for the low-income people the program serves, are serious. We must find ways to reduce burdens on applicants and participants, and to reduce administrative complexity for local administrators.
Maintaining the Nutrition Safety Net: The national eligibility and benefit rules of the Food Stamp Program form a safety net across all States. As States continue to explore innovative welfare policies, food stamps must be available to provide a steady base that serves the basic nutrition needs of low-income households wherever they live. We need to preserve the program's national structure. At the same time, we should consider whether program changes, including increased administrative flexibility, could help to ensure that all those at risk of hunger have access to the benefits they need. We also need to improve the program's effectiveness in promoting healthy diets for the people it serves.
Improving Accountability: As you know, prudent stewardship of Federal resources is a fundamental responsibility, and is critical to continued public confidence in this important program. We need to remain vigilant in the fight against error, fraud and abuse, and consider improvements that can help to ensure that the taxpayer investment in the program is used as effectively as possible.
The Food Stamp Program's missionto end hunger and improve nutritionremains as vital today as at the program's beginnings. I am pleased to join the discussion we begin today to preserve the elements of the program that have contributed to its history of success, and to strengthen and improve it to meet the challenges of a new century.
Page 193 PREV PAGE TOP OF DOC Mr. Chairman, that concludes my remarks. I would be pleased to answer any questions.
Statement of Sonia Rivero
As Commissioner of the Commonwealth of Virginia Department of Social Services, I am honored to have the opportunity to provide testimony regarding the administration of the Food Stamp Program as you consider reauthorization.
The last major legislative overhaul of the Food Stamp Program was included in the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) in 1996. This was the most substantial change since the Food Stamp Act was rewritten in 1977. We applaud the intent that Congress had when it acted in 1996 to amend the Food Stamp Program. PRWORA was designed to:
expand authority and flexibility for States,
strengthen work and eligibility requirements,
control future spending, and
continue to move toward the electronic delivery of benefits.
PRWORA marked a substantial beginning with great potential. It provided an opportunity to more closely link the Food Stamp Program with welfare reform's emphasis on work and self-sufficiency. That promise still exists. Unfortunately, rigid Federal regulations have severely limited the intent of Congress. As it is currently administered, the Food Stamp Program is not in line with PRWORA objectives. Micro-management by the Federal agency and a preoccupation with payment accuracy processes and quality control are the current focus rather than the overarching intent of PRWORA - work first and self-sufficiency. We encourage Congress to build on the intent of PRWORA as originally envisioned in 1996 and to make major, rather than incremental, changes.
Page 194 PREV PAGE TOP OF DOC The recommendations I am offering today are intended to strengthen the Food Stamp Program and help Virginia and other States deliver benefits in a manner consistent with the principles of PRWORA.
EXPAND AUTHORITY AND FLEXIBILITY TO STATES
Expanding the authority of States and their flexibility in operating the Food Stamp Program is important to our success. PRWORA included several provisions that were intended to provide this authority and flexibility. The following are areas that need to be reviewed and addressed.
Promote Program Simplification
The Food Stamp Program has not been streamlined or simplified as Congress intended. While the Federal Government has given greater flexibility to States to design programs such as Temporary Assistance for Needy Families (TANF) and Medicaid, they have not granted comparable flexibility in the Food Stamp Program. Virginia has moved thousands of TANF recipients from dependency to self-sufficiency since implementation of PRWORA. We believe we can have similar success if the Food Stamp Program is simplified.
Rather than simplifying the Food Stamp Program, the Federal Government, through the many changes made over the years, has made the Food Stamp Program more complex. Congress included a State option under PRWORA, the ''Simplified Food Stamp Program'', that was intended to give States more control over the Food Stamp Program. States have not been able to utilize this option because of restrictive program requirements. For example, the Simplified Food Stamp option only applies to TANF-related cases. Efforts to continue overall program simplification are still needed.
Application processing, change reporting and processing, and re-certification procedures are still micro-managed by Federal regulations to an extent far exceeding requirements set forth in PRWORA. The final regulation issued November 21, 2000, by the United States Department of Agriculture (USDA) under the previous administration not only retained prescriptive and complex requirements for Food Stamp applications, but even added new ones. New requirements also were added regarding re-certification procedures. These provisions continue to hamper our ability to operate an efficient program, contribute to program complexity, and discourage recipients with unnecessary paperwork and red tape.
Page 195 PREV PAGE TOP OF DOC We recommend a truly simplified application process. The Food Stamp allotment calculation methodology must be greatly simplified. Consideration should be given to the elimination of the long and complicated deduction process for eligibility determination. A gross income calculation should be implemented without the numerous deductions that are currently in place. We also recommend that client-reporting requirements be modified. A reasonable reporting approach for all households should be instituted.
Several Food Stamp household composition policies are outdated, inconsistent, or needlessly complex. For example, Food Stamp policy should be revised to allow children who are under 18 years of age and live with their parents to be considered part of the parents'' household, regardless of whether they purchase and prepare meals together or separately. Additionally, any person age 18 or older who is unable to purchase and prepare meals separately because of a severe physical or mental disability should have separate household status.
We also recommend simplifying the processes for individuals living in institutions. Most residents of institutions are ineligible for Food Stamps because the institutions provide meals as part of their service. However, there are several types of institutions where residents may participate in the Food Stamp Program if they meet the income, resource, and non-financial requirements.
States should be allowed to make payments to institutions through a billing system, rather than issuing Food Stamp benefits up front to clients or authorized representatives. The facility would bill for the number of days each eligible resident was in the institution. This would eliminate the complicated processes now undertaken when partial allotments must be returned to residents who leave the facility during the month. Implementation of Electronic Benefit Transfer (EBT) has added another layer of complexity to issuing benefits to residents of institutions. Some States divert all residents' allotments to a ''super account'' for the institution administrator, while others equip institutions with point-of-sale devices so EBT cards can be used at the facility. A billing system would resolve these issues and promote administrative simplicity.
Page 196 PREV PAGE TOP OF DOCREMOVE EXTENSIVE WAIVER LIMITATIONS
The extensive waiver limitations and exclusions in present law must be removed. State requests for waivers must be expeditiously approved on the simple basis that they demonstrably simplify program administration, improve efficiency, and/or enhance access to benefits. In addition, waiver requests should be approved without unnecessarily expensive evaluation requirements.
FOCUS ON SERVING THE NEEDS OF PARTICIPANTS
Complexity of program rules results in caseworker and client error. Virginia has faced fiscal sanctions in recent years resulting in a heavy burden on State general funds because of caseworker and client error. We attribute the bulk of these errors to error-prone Federal policies and the complexity of the program. We have been forced to spend a great deal of time and attention on meeting quality control requirements and issues surrounding payment accuracy.
We need to reduce the excessive focus on quality control and payment accuracy and focus on the needs of our participants. While sound program administration is vital, other outcome measurements should be developed. Increases in earnings and other indicators of greater self-sufficiency could be included as performance measures. USDA should reduce the emphasis on dollar-for-dollar errors that result in millions of dollars in sanctions to States each year. The present quality control system must be replaced by appropriate and realistic accountability and outcome measures.
STRENGTHEN WORK AND ELIGIBILITY REQUIREMENTS
The intent of PRWORA and of Virginia's welfare reform effort is to move recipients off welfare and into the work force. We recommend that Congress strengthen work and eligibility requirements. We also recommend that Congress provide enhancements to address the needs of the elderly and disabled.
Page 197 PREV PAGE TOP OF DOCENHANCE THE FOOD STAMP EMPLOYMENT AND TRAINING PROGRAM
The Federal Government must provide sufficient employment and training funding to serve all those subject to work requirements, and lift the caps on reimbursement amounts. Currently, 80 percent of Food Stamp Employment and Training (FSET) funds are restricted to provide employment and training for Able-bodied Adults without Dependent Children (ABAWDs). This restriction limits our ability to reach the heart of our Food Stamp population.
The Federal Government must provide FSET funding sufficient to serve all of those subject to work requirements. Current funding is inadequate. Virginia, like most States, has been able to do little beyond offering minimal job search activities.
Sufficient Federal funding for employment and training for those who are subject to a work requirement is essential. States must be able to simplify work program administration, assure coordination and alignment among various work program funding streams, and provide appropriate welfare-to-work opportunities for program participants.
States should be given the flexibility to align Food Stamp Program and TANF work requirements. All recipients subject to Food Stamp work requirements should be mainstreamed into the State's integrated work force development program.
INCREASE ACCESS TO BENEFITS ON BEHALF OF THE ELDERLY AND DISABLED
While we do not support the expansion of the Food Stamp Program, we want to ensure that Food Stamp benefits reach those beneficiaries who are most vulnerable - the elderly and disabled population. Recipients of Supplemental Security Income (SSI) are either elderly or disabled and have few resources. The Social Security Administration (SSA) should add a nutritional supplement for SSI recipients. SSA would administer the payment although its costs would continue to be funded from the Food Stamp Program. SSI recipients would no longer be required to participate in a separate Food Stamp Program, thereby reducing the amount of redundant information requested of SSI recipients who are either elderly or disabled.
Page 198 PREV PAGE TOP OF DOCCONTROL OF FUTURE SPENDING
Much of the focus to control future spending has been on Federal Government savings. This focus has shifted costs to States and resulted in unfunded mandates. Congress needs to ensure that while Federal cost-saving measures are instituted, costs do not shift inadvertently to State tax dollars. In addition, States should be provided an enhanced match for implementing and publicizing changes in the Food Stamp Program.
ELECTRONIC DELIVERY OF BENEFITS
PRWORA mandated that States implement an EBT delivery system for the Food Stamp Program by October 2002. The Commonwealth of Virginia has contracted with a vendor and will begin a pilot by November 2001. EBT will be implemented statewide by July 2002. We are excited about this change in benefit delivery and fully expect our clients, retailers, and other client service partners to recognize the enhanced service to Virginia citizens. The EBT provisions were definitely a positive feature of PRWORA.
PROMOTE EQUITABLE COST-SHARING
With the improved service to clients, however, we will pay a high price for this success story. The traditional 5050 match for administrative expenditures is no longer adequate and does not reflect the shift of responsibilities to States that formerly belonged to USDA. At the same time, USDA is realizing significant cost savings since the Department no longer has to pay for the printing, distributing, redeeming, and accounting for paper stamps. The Federal Government should pay 100 percent of costs of functions that were formerly Federal costs under a paper system.
REDUCE THE COST OF VENDOR PROCUREMENT
State cost has risen because of the lack of competition among EBT vendors; currently, 33 States all share the same EBT prime vendor and are seeing basic prices double and triple from those paid just a few years ago. As a result, Virginia's cost to implement EBT is higher than that of States that implemented EBT just a few years ago. We anticipate increased cost in the procurement of EBT services at the end of our contract in three years. States are straining under the cost of fees for services.
Page 199 PREV PAGE TOP OF DOCINCREASE CUSTOMER SERVICE SUPPORT
EBT gave birth to a level of service for clients and retailers that was not inherent in the paper coupon system. Federal regulations require that EBT clients and retailers have access to an EBT Help-Line 24 hours a day, 7 days a week. This service represents a new financial burden to Virginia and other States without additional funding. Call centers are a high cost item for States.
MINIMIZE THE SHIFTING OF COSTS TO STATE AND LOCAL GOVERNMENT
We rely on the retail grocers to partner with us to serve our clients and their customers. In the paper system, USDA managed all Food Stamp-certified grocers. However, with EBT implementation, USDA has shifted the responsibility of retail point-of-sale (POS) deployment, training, marketing, and complaint resolution from the Federal Government to the States. Virginia, like other States, will have to assume 50 percent of the cost.
DEFRAY THE COST OF INTEROPERABILITY
PRWORA required that generally accepted operating rules based on commercial technology be followed to permit interstate operations. In order to meet this requirement, States must ensure that its EBT vendor enters into agreements with other networks, switches and gateways across the Nation, so that our clients are free to travel from State to State and shop at certified Food Stamp grocers. In the paper system, there was no cost to States for this level of client access.
SIMPLIFY TRANSACTION ADJUSTMENTS
USDA's final rule (July 2000) on EBT Adjustments requires States to make adjustments in an account to correct an auditable, out-of-balance settlement condition that occurs during the redemption process as a result of a system error.
Page 200 PREV PAGE TOP OF DOC This rule is in conflict with the requirement that States follow generally accepted operating rules based on the commercial debit card model. In the commercial model, adjustments are settled between the customer (retailer or client) and the processor. Because of the complex rules for tracking, notification, claims, partial settlement and fair hearings, it is not cost effective for EBT vendors to provide this service. Virginia and other States will be burdened with the cost of purchasing an adjustment product from their vendors.
REDUCE THE COST OF DATA STORAGE
The EBT system generates a mammoth amount of data. Every transaction made with the card and with the Virginia EBT administrative terminal user must be documented. This data must be used to report, analyze, manage, and monitor activity at the point-of-sale (POS), the Commonwealth's local and regional agencies, and at the EBT vendor's facility. Data warehousing is a costly item in terms of staff, equipment, and technology. The USDA's stringent and complex reporting requirements have resulted in standard EBT reports that are primarily used for retail management, fraud, abuse, and investigations. Additional reporting tools must be purchased at an additional cost to State government.
Virginia needs relief from the increased costs that we will incur. We recommend that the Federal share of the 5050 administrative match be increased to ensure that EBT costs do not continue to shift from USDA to States. At a minimum, USDA should share its savings with the Commonwealth by paying 100 percent of costs of functions that were Federal responsibilities under the paper system, such as the Food Stamp redemption aspects of retailer management, interoperability, EBT Client Help-Line, and transaction adjustments. Similarly, USDA should eliminate some of the redundancy of stored data by sharing its EBT data retrieval programs, software, and storage areas with Virginia, rather than forcing the Commonwealth to generate reports, queries, and searches for audit and fraud investigations.
Page 201 PREV PAGE TOP OF DOC The Federal Government should further fund the efforts of States as they strive to develop new and innovative ways of delivering benefits electronically. EBT is a successful method of delivering benefits to clients. The EBT prototype has been developed and accepted by States as the wave of the future. The Commonwealth of Virginia believes that now is the time to develop a more cost-effective model by reducing the vendor monopoly reign that prevails today.
Virginia wants to administer a simplified Food Stamp Program that:
supports self-sufficiency and independence through employment;
provides benefits to those unable to work, especially the elderly and disabled;
is governed by eligibility rules that are easy to understand and administer; and
can be readily accessed by people in need.
Reauthorization provides Congress with the opportunity to reevaluate the program's goals and develop the framework for attaining those goals. We encourage Congress to build on the tenets of PRWORA to enable Virginia and other States to effectively and efficiently deliver benefits to those in need while fulfilling our role as a steward of taxpayer dollars.
Statement of Jerry Friedman
Mr. Chairman, Representative Clayton, members of the committee, my name is Jerry Friedman and I am the Executive Deputy Commissioner for the Texas Department of Human Services. Thank you for the opportunity to speak with you about the upcoming reauthorization of the Food Stamp Program. We truly appreciate your allowing us to provide information on subjects you have identified as important in considering the administration of the program such as simplification of the program for families in need of assistance and for States administering the program. We also look forward to providing you information on the status of Texas'' implementation of EBT and how it has worked in our State.
Page 202 PREV PAGE TOP OF DOC We regard food stamps as a supportive service to working poor, the elderly, persons with disabilities, and families and individuals who are in transition to a more stable economic life. In Texas, we have taken some significant steps to assure that people know of their potential eligibility for food stamps. For example, we conducted over a dozen worker, client and advocate forums across the State to gather input regarding access to services. Specific efforts related to access to the program include:
an outreach and education campaign which included development and distribution of PSAs to TV, radio and the print media; distribution of over one million pamphlets and posters to various organizations statewidelibraries, schools, homeless shelters, food banks and soup kitchens; and establishing a food stamp hotline, specific to the effort;
extended business hours in 88 offices statewide to accommodate working recipients;
a contract with the Texas Association of Community Action Agencies to conduct community outreach, education, and application assistance related to the food stamp and nutrition programs, using some of the enhanced Federal funds the agency earned due to high accuracy rates in determining eligibility for the Food Stamp Program;
design and upcoming implementation of a program which increases access to the Food Stamp program for the elderly;
a redesigned application developed by a workgroup made up of client advocates, other State agencies, legislative staff and DHS workers to simplify the process for clients, making it more user-friendly;
two customer service surveys (one a ''Mystery Shopper'' design) conducted to determine satisfaction with the agency's client service delivery; and,
a web-based client tool, called STARS which allows clients to screen for services they may be eligible for across health and human service agencies from any location that has Internet accesshospitals, libraries, schools, WIC clinics, etc. The client screener is currently available in selected DHS offices. It will be available on the Internet in July 2001.
Page 203 PREV PAGE TOP OF DOC Finally, Texas State law requires expedited food stamp benefits be provided in 24 hours rather than the 7 day maximum set in Federal provisions.
I am proud of the Texas effort to assure those in need are receiving the supportive services the Food Stamp Program provides. Although it is impossible to assume a direct correlation, the State has seen a modest increase in Food Stamp participation in the past year. This means a great deal in a State like Texas where a 3 percent increase means over 40,000 more people receiving Food Stamps.
I am also proud of this State's commitment to the integrity of the Food Stamp Program because such a commitment results in public support of the program. Texas has earned enhanced Federal funds for the last three years. In FFY 1998, the State earned almost $20 million because of our 5.27 percent payment error rate. In FFY 1999, the State earned $27.9 million based on a payment error rate of 4.56 percent. And in FFY 2000, Texas earned $28.6 million based on a payment error rate of 4.14 percent.
As you can see, Texas is committed to a Food Stamp program that is accessible to all and that has the support of the public because of accuracy in the administration of the program.
The reauthorization of this vital program gives us an opportunity to consider changes which allow the Food Stamp Program to best fulfill its intentprovide nutritious food to individuals and families in need as they seek to maximize their independence. Texas would offer these recommendations.
First, the program must be accessible to those who are eligible, and simplification is the key. Second, the program must be accountable in a way that protects the integrity of the program while allowing for good customer service, maximum participation, and low administrative costs. Third, the program should support the States'' efforts to move people on to social and economic stability as quickly as possible.
Page 204 PREV PAGE TOP OF DOC Specifically, we would recommend two major changes related to simplification:
(Simplify eligibility by using a single deduction
Simplify reporting by modifying the change-reporting requirements.
These two changes would improve access, with benefits to both clients and administering agencies through a simplified application process, improved customer service, and reduced paperwork and verification. Such changes would also make the program more supportive of work and the movement of individuals and families to social and economic stability. Finally, the changes would increase program accountability by changing the focus from technical errors to a broader range of issues including program effectiveness, customer service and education regarding the program.
Another concern for Texas is the need to improve access to the Food Stamp program for the elderly and disabled. Many of our most vulnerable citizens are potentially eligible for food stamps, but may not participate because of difficulties they face in the application process or the limitations related to the amount of benefit because of the deductions. We would recommend three changes which would improve access to these vulnerable citizens:
An increase in the minimum benefit for the elderly
A standard medical deduction to ease the application process for elderly applicants
Additionally, Texas would recommend vehicle exemptions be changed to reflect and support policies that focus on work and the goal of self-sufficiency, using reasonable limitations on the value of vehicles. As the committee is aware, transportation is a major barrier to employment for individuals and families with low-income. Texas remains a largely rural State and many of our clients have to drive considerable distances to get to workthus they need dependable transportation. Such a change provides a clear message that work and the essential tools of work are important. Also in support of work and the goal of self-sufficiency, Texas would recommend flexibility in the administration of the Food Stamp Employment and Training (E & T) program. Currently, the E & T program has limitations on how these funds may be spent which restricts our ability to serve all those in need.
Page 205 PREV PAGE TOP OF DOC Changes are also needed to improve the accountability system of the Food Stamp program. The current system presents challenges to good customer service and adds significant administrative costs. Please know that we support the integrity of the Food Stamp Programwe think Texas has shown its commitment over the last few yearsbut at the same time, we believe that accountability for the program should be reassessed with a focus on:
1. A credible measure of payment accuracy
2. A sound theoretical and research basis for standards
3. Accountability of States for things under State control
4. Measurements related to program purpose
In addition, currently, quality control error rates allow for variances of $25 or less for over and under issuance, but the same disregard is not applied to ineligible cases. This inconsistent criteria does not allow for an accurate assessment of the State's payment error rate. And, we would ask for reconsideration of the provision in PRWORA which requires State agencies to collect on all benefit overpayments, regardless of how the overpayment occurred. We would request flexibility in the collection of agency error claims, including consideration of the age of the claim.
Finally, the committee had asked for a status on implementation of EBT systems and the effectiveness of those systems. Texas was the second statewide EBT system in the country, with initial implementation beginning in October 1994 and full implementation completed in November 1995. Known as the Lone Star card, our system provides both cash (TANF) and food (FS) benefits to over 500,000 cardholders, and handles an average of 4.9 million transactions per month. The EBT program has been an extraordinary success, supported fully by all stakeholders including clients, retailers, and the general public.
In February of this year, we entered into the second generation of EBTor as we call it, EBT2. The State had determined that a single vendor approach presented problems which should be avoided in subsequent contracts. Texas successfully implemented a multi-vendor approach which is not only innovative, but also effective in providing services to clients while assuring State control of the system. I would be remiss if I did not mention that the strong working relationship with our Federal partner, FNS, has been critical to the success of our EBT program.
Page 206 PREV PAGE TOP OF DOC Texas is known for its work in EBT trafficking. The State has pioneered the effort to combat food stamp trafficking using the electronic trail available in an EBT system. In fact, the GAO identified Texas as one of two States that account for almost all trafficking cases prosecuted by the States.
We appreciate the recent regulations which allow States to retain a share of recovered funds in these cases at the same rate as other fraud cases (35 percent). But the truth is, trafficking investigations take a great deal of time and resourcesand the basis for retaining funds is only those recorded transactions which reflect a very small amount of the entire theft by any one retailer. Since the Federal Government uses the evidence developed by the State to obtain sizeable civil monetary penalties from the retailer who commits the trafficking violation, we believe the State should be entitled to a portion of the sanction.
I hope that these comments provide useful information regarding opportunities the committee has to consider the reauthorization of the Food Stamp program. That concludes my remarks. I would be happy to address any questions you may have.
Statement of Governor Jim Hodges and Governor Bob Taft
We are pleased that the subcommittee is holding a hearing on the Food Stamp Program, because we believe the upcoming reauthorization offers an opportunity to bring a critical component of the Federal-State human services framework into the 21st Century. As you begin to consider reauthorization, Congress has an extraordinary opportunity to make changes to the program that will promote integrated customer service and will ensure that a greater percentage of Federal and State dollars directly benefit individuals and families in needrather than support a expanding bureaucracy. Just as the private sector is rapidly moving to focus on customization, integration of services and responsiveness to customers'' needs, your leadership could be central to a parallel initiative by the Federal Government. We believe this is a unique opportunity and strongly urge the subcommittee to work with the Nation's Governors in taking such an important step.
Page 207 PREV PAGE TOP OF DOC On behalf of the Nation's Governors, we would like to submit for the record a copy of the National Governors Association (NGA) Food Stamps Policy (HR22). While this policy was adopted more than a year ago, the need for reform remains, and the key principles outlined in the policy still apply.
As with many human service programs, success in the Food Stamp Program relies heavily on a strong State-Federal partnership. Governors believe strengthening the State-Federal partnership will help to improve effectiveness and improve the desired outcomes of the program. As welfare reform has progressed throughout the country, policies within the Food Stamp Program have primarily remained stagnant. While there is a great deal of interest at the State level for greater coordination of State-administered programs, such as food stamps, barriers in Federal law, such as different rules for different funding streams, and a lack of flexibility in program implementation at the State and local level, often create obstacles to integration.
Despite some positive changes that were made through regulations late last year, States still have very little flexibility in administering the Food Stamp Program. Through the initial success of welfare reform, States have demonstrated the potential success that comes with devolvement of authority from the Federal Government to the State and local level. States are now working to address the needs of low-income families and individuals through a comprehensive package of supports, rather than piecemeal through individual program categories. The lack of flexibility within the Food Stamp Program complicates this process.
Specifically, as you consider the reauthorization of the Food Stamp Program, it is imperative that the subcommittee address the program's Quality Control (QC) system. We bring to your attention Section 22.4.4 of the NGA policy, which highlights the need for QC reform. We strongly believe that the Food Stamp Program should focus on desired outcomes rather than solely on process measures. The current QC system conflicts with the broader public policy goal of encouraging low-income individuals to maintain steady employment, and very often causes States to focus a disproportionate amount of their resources to process-oriented measures, rather than on actually improving a families'' well-being.
Page 208 PREV PAGE TOP OF DOC We look forward to working with you to take advantage of the opportunity for change that comes with the upcoming debate on food stamp reauthorization. We strongly encourage you to give serious consideration to the recommendations of the Nation's Governors and the State administrators. If you have any questions, please contact Gretchen Odegard of the NGA staff at (202) 6245361.
POLICY POSITION. NATIONAL GOVERNORS ASSOCIATION
HR22. Food Stamps Policy 22.1
Background The Nation's Governors believe that the Food Stamp Program provides a key benefit to many low-income individuals and families, including the elderly and the disabled. Further, Governors support the notion of promoting food security for all citizens. However, Governors believe that reform in the Food Stamp Program could greatly improve the effectiveness of the program by reducing the administrative burden on State and Federal Governments and, most importantly, by improving access to benefits for individuals and families in need.
The Food Stamp Program meets dual purposes-providing both nutritional assistance and an income supplement to low-income individuals and families. Governors recognize that originally the Food Stamp Program was designed as a means to alleviate hunger. And while supporting the continuation of this goal, Governors also believe that food stamp benefits for many recipients should be viewed in a broader context of moving individuals toward self-sufficiency. As such, food stamps should be regarded as an essential income supplement. With the advent of welfare reform, more low-income families are improving their economic status by moving from welfare to work. Governors believe the Food Stamp Program is a key component in States' efforts to assist in individuals' transition from welfare to work and toward self-sufficiency.
As with many other human service programs, success in the Food Stamp Program relies heavily on a strong State-Federal partnership. Although food stamp benefits are 100 percent federally funded, States administer the program. Further, the administrative financing is shared fifty-fifty. Governors believe strengthening the State-Federal partnership will help to improve the effectiveness of the Food Stamp Program.
Page 209 PREV PAGE TOP OF DOC 22.2 Caseload Decline. Due to a number of factors, the number of individuals receiving food stamps has declined over the past few years. Governors recognize the concern that some individuals who are eligible for food stamps may not be receiving benefits. Regardless of differing views on whether this decline is an appropriate measure of success in welfare reform, Governors want to ensure that access to food stamp benefits is available for those who are eligible. While some view a decline in food stamp caseloads as a sign that more families are achieving self-sufficiency, others believe a drop in the food stamp caseload signals a missed opportunity to provide a crucial human service benefit. Factors contributing to the drop in the food stamp caseload include the following:
22.2.1 Individuals choosing not to access the system. Governors recognize that many individuals make a choice not to access the food stamp system. While ensuring access to benefits is imperative, personal choice ultimately dictates whether an individual seeks assistance. For many, the stigma of food stamps as a welfare program remains despite Federal efforts to promote food stamps as a nutrition assistance program. In addition, extensive Federal restrictions and requirements lead to many individuals choosing not to access the Food Stamp Program. For some, the hassle of dealing with the Food Stamp Program outweighs the benefit.
22.2.2 Program requirements conflict with welfare reform. With the advent of welfare reform, a greater number of low-income individuals are working. If the goal is to encourage these individuals to access the food stamp system, the Federal program requirements need to be adjusted to be more recipient-friendly. For example, current food stamp policies require frequent in-person eligibility recertification interviews, which usually require a day away from work. In addition, current rules require recipients to report nearly every change in wage amounts, which are likely to fluctuate often.
22.2.3 Confusion among immigrants regarding eligibility. The 1996 welfare reform law restricted access to food stamp benefits for many immigrants. However, benefits for certain categories of eligibility have now been restored, and many of these individuals may not be aware of this restoration.
Page 210 PREV PAGE TOP OF DOC 22.3 Need for Reform. As welfare reform has progressed throughout the country, policies within the Food Stamp Program have primarily remained stagnant. While Governors believe the current food stamp system provides a key benefit for individuals and families, many of the outdated policies should be reconsidered in light of welfare reform. The current Food Stamp Program is increasingly complex to administer, and the program's quality control (QC) system largely ignores measures to support working families. Federal restrictions, such as the requirement that States must continue to spend 80 percent of their food stamp employment and training (E&T) funds on a decreasing segment of the population, diminishes the effectiveness of the E&T program. These increasing administrative complexities weaken the ultimate purpose of the program, which is to serve low-income individuals and families. Governors believe that exploring options for food stamp reform will prove to be beneficial to all low-income citizens in need. It is important to note that not all individuals eligible for food stamps are connected with the time-limited benefits such as the Temporary Assistance for Needy Families (TANF) program. For certain individuals such as the elderly and the disabled, food stamps may be an ongoing benefit, rather than a temporary income supplement while moving from welfare to work. Bearing in mind the various populations served and the differing missions of food stamps, Governors believe overall system reform will greatly improve the current effectiveness of the Food Stamp Program.
22.4 Options for Reform. Options for food stamp reform could include, but are not limited to, the following.
22.4.1 Increase waiver authority. Governors believe that, as with other human service programs, States should be encouraged to develop innovative approaches to administering food stamp benefits. Flexibility such as that provided in the TANF block grant program has demonstrated the ability for Governors to administer programs in a way that best meets the needs of individuals in their States. Current waiver authority in the food stamp system is extremely restrictive and burdensome, leading to numerous waiver requests being denied. Governors urge Congress and the administration to broaden current waiver authority and allow for State demonstration projects.
Page 211 PREV PAGE TOP OF DOC 22.4.2 Decrease the administrative burden on recipients. First, in order to better serve low-income working families, the restrictive paperwork requirements should be made more recipient-friendly. While frequent and detailed income reporting is administratively complex for the States, Governors believe it is even more burdensome for the individuals the program is designed to serve. For example, requiring frequent face-to-face redeterminations often disrupts an individual's workday, decreasing effectiveness on the job. Governors urge Congress and the administration to simplify the current food stamp rules to reflect the changing food stamp population in light of welfare reform. While Governors appreciate recent changes that were made to reduce the administrative burden on recipients, further system improvements could be made, such as providing States with the option to disregard the value of a vehicle in determining food stamp eligibility.
22.4.3 Improve program benefits for the elderly and the disabled. Changes in the current food stamp rules could also benefit those not connected to TANF, such as the elderly and the disabled. For example, the minimum food stamp benefit level is currently set at $10. Complex paperwork for a very small benefit may discourage many elderly and disabled from accessing food stamp benefits.
22.4.4 Streamline the quality control (QC) process. Governors believe that the existing QC system for food stamps is extremely burdensome and conflicts with the broader public policy goal of encouraging low-income individuals to maintain steady employment. Notwithstanding the need for accountability within the food stamp system, the current QC requirements diminish the time and resources that could be more appropriately dedicated to providing benefits to individuals in need. Further, as more food stamp recipients are going to work, their income levels begin to more frequently fluctuate. These income fluctuations often lead to the increased chance for a food stamp worker to ''error.'' States are essentially penalized, therefore, as a result of more individuals working. Governors urge Congress and the administration to work with States to develop a more appropriate system for measuring outcomes in the Food Stamp Program.
Page 212 PREV PAGE TOP OF DOC 22.4.5 Adjust the employment and training program. Within a State's allocation for the Food Stamp Employment and Training program, 80 percent of the funds must be set-aside for able-bodied adults without dependents (ABAWDs). Unfortunately, very few ABAWDs are now in the food stamp system, and therefore the E&T money remains underutilized. Governors urge Congress to provide States with greater flexibility to more effectively use the food stamp E&T funds to assist in moving additional populations into the workforce. Time limited (effective Winter Meeting 2000-Winter Meeting 2002). Adopted Winter Meeting 2000.
Statement of Jennifer Reinert
Good afternoon, Mr. Chairman and members of the subcommittee. I am Jennifer Reinert, Secretary of the State of Wisconsin's Department of Workforce Development. I would like to thank Chairman Goodlatte, Ranking Member Clayton and the other members of the subcommittee for the opportunity to testify on the subject of the administration of the Food Stamp Program.
Since the passage of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, dramatic numbers of people in our State have moved off the cash assistance rolls and have found and retained employment. In Wisconsin today, less than 7,000 families now receive cash assistance.
As welfare reform has progressed and more people have moved into the workforce, the provision of support services has become a key part of the package necessary to ensure job retention as families continue their efforts toward full self-sufficiency.
In Wisconsin, we have been able to expand health care benefits to low-income working families through a Federal/State partnership called BadgerCare. As a result, more than 115,000 children and their parents have Medicaid coverage. This represents a 30percent increase in covered families in the last two years.
Page 213 PREV PAGE TOP OF DOC We have also been able to secure and streamline Federal matching funds to greatly expand available quality child care services. Wisconsin now serves more than 42,000 children from 24,000 families through Wisconsin Shares, our child care subsidy program for low-income working families. This represents a 40percent increase in the child care subsidy program over the last two years
Unfortunately, our ability to meet the needs of working families and promote good customer service when it comes to the Food Stamp Program has not kept up with these other programs. Instead, Wisconsin, similar to other States, has been hampered by the fact that Food Stamp Program policies, which can be difficult to implement under the best of circumstances, have become even more challenging as people have entered the workforce and have fluctuating income and expenses. In particular, requirements such as face-to-face interviews, verification and documentation of voluminous data, frequency of reporting changes in household circumstances, and frequency of redetermination of eligibility are impediments to program participation and good customer service.
WISCONSIN EFFORTS TO OVERCOME CURRENT IMPEDIMENTS
Wisconsin has been working very aggressively to overcome these challenges in order to ensure we are providing appropriate services to those who are eligible for them. In particular, Wisconsin has stepped up outreach efforts and increased access points to make application to the program easier, such as outstationing eligibility workers at non-traditional community sites. As a result, while participation in the Food Stamp Program has continued to decline nationally, we have seen a 10percent increase over the past year, which is one of the largest increases in the country. More than 216,000 people are now participating in the program, the most since June of 1997.
In addition, Wisconsin has been highly successful in converting from the paper coupon system to the Electronic Benefit Transfer plastic debit card. Our conversion took place in 2000. While virtually all other States saw a decline in program participation during conversion to the EBT system, our caseload continued to grow, including families and disabled individuals, due to extensive up-front public education and outreach coordinated by our State and local agencies and community advocate groups, all working together.
Page 214 PREV PAGE TOP OF DOC Nevertheless, the ability of Wisconsin to manage the Food Stamp Program as effectively and efficiently as possible, in order to ensure that the needs of participants are made met, is severely limited by the program's current parameters.
For instance, the Federal policy limits the amount of ''liquid assets'' a household can have in order to qualify for food stamps: $2,000 for those under age 60, $3,000 when someone in the household is 60 or older. This policy requires the applicant to provide verification from a reliable source, such as a car dealer, of the value of any vehicles he or she owns, documentation of savings and checking accounts, savings bonds, burial funds, retirement accounts, children's trust funds. . . the list goes on and on. This is similar to what a bank requires of any of us when we apply for a home mortgage. However, this scenario is repeated every 6 or 12 months when a program participant must be ''recertified.''
What is the result of this investment of time and energy on the part of a program participant? According to a recent report by the United States Department of Agriculture, the ''countable'' assets in an average Food Stamp case is only about $140.
This is just one example of the complex requirements of the Food Stamp Program and the burdens that are placed on program participants. I believe it illustrates the point that significant changes are needed in the Food Stamp Program to simplify access and services for participants, to streamline administration, and to reinforce work incentives.
SUGGESTED PROGRAM MODIFICATIONS
So, what needs to happen? The key change that is needed is to ''update'' the Food Stamp Program and bring it in line with the other programs that touch the lives of those in need: Temporary Assistance for Needy Families (TANF) programs, Medicaid, and Child Care. In particular, changes need to be made to the eligibility determination and application processes, and additional flexibility needs to be built into the program.
Therefore, Wisconsin supports the American Public Human Services Association (APHSA) recommendations, which include:
Page 215 PREV PAGE TOP OF DOC Simplifying the process for calculating Food Stamp benefits, including standardized housing cost deductions.
Simplifying application processing, change reporting, and re-certifications.
Either 1) eliminating the asset test, 2) raising the asset limit, or 3) allowing States to use their TANF or Medicaid limits, whichever is higher. Wisconsin prefers eliminating the asset test.
Simplifying household composition rules.
Providing a 6-month transitional Food Stamp benefit when an increase in earnings causes the case to become ineligible, similar to Medicaid transitional benefits.
Encouraging program participation by seniors and disabled individuals by setting minimum benefits greater than the current $10 per month.
Enhancing employment and training programs, including adequate funding, to encourage self-sufficiency.
Increasing Federal matching share for State efforts to improve outreach and participation, similar to Medicaid enhanced funding provided by the Department of Health and Human Services.
I should point out to you that in Wisconsin, there is broad consensus that the Food Stamp Program must be simplified in order to reach the target population and streamline administration to better serve our customers. The recommendations presented to you today, as well as some others, reflect the consensus opinion of a Food Stamp Policy Workgroup in our State. Members of the workgroup include a number of family, nutrition and local advocate agencies and organizations (including the Hunger Task Force of Milwaukee, Community Action Agencies, Wisconsin Council on Children & Families, and University of Wisconsin-Extension), local and State government stakeholders, and retail food distributor representatives.
Page 216 PREV PAGE TOP OF DOCSUMMARY
In short, Wisconsin believes that the Food Stamp Program needs to be overhauled in order to improve customer service, streamline administration, and to allow States the flexibility to provide coherent, coordinated services to low-income participants. Clearly, such changes can only be of benefit to participants, many of whom have taken the first and necessary steps to achieve self-sufficiency by entering the world of work and yet find the Food Stamp Program has not kept pace with their achievements.
Thank you for providing this opportunity to me to testify today about the Food Stamp Program. I would be happy to respond to any questions you may have.
Statement of Roger Viadero
Good afternoon, Mr. Chairman, and members of the committee. We appreciate the opportunity to testify about changes in the Food Stamp Program since the passage of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, generally know as the Welfare Reform Act, and the status and effectiveness of implementing Electronic Benefits Transfer (EBT) systems in States to issue food stamp benefits. With me today are Gregory S. Seybold, Assistant Inspector General for Investigations; and Richard D. Long, who was recently appointed as the Assistant Inspector General for Audit.
The Welfare Reform Act declared individuals ineligible to receive Food Stamp Program benefits who are fleeing to avoid prosecution, custody, or confinement after conviction. At the same time, it authorizes State agencies to provide the addresses of food stamp recipients to any Federal, State, or local law enforcement officer for official purposes.
Capitalizing on this authorization, OIG began a law enforcement initiative known as ''Operation Talon'' in conjunction with other law enforcement agencies across the United States to locate and apprehend fugitives who may also be illegally receiving food stamp benefits. Operation Talon was designed to carry out the intent of Congress by:
Page 217 PREV PAGE TOP OF DOC removing ineligible fugitive felons from Food Stamp Program rolls, thereby reducing program outlays;
removing fugitive felons from the streets in order to make our communities safer; and
demonstrating to States how to carry out the statutory provisions on a continuing basis.
Since its inception in early 1997, Operation Talon has resulted in 7,481 arrests. Serious crimes perpetrated by those arrested include homicide-related offenses (murder, attempted murder, and manslaughter), sex offenses (child molestation, rape, and attempted rape), kidnapping/abduction, assault, robbery, and drugs/narcotics violations. Exhibit A contains a chart depicting, by State, the number of arrests and the related crimes.
The Welfare Reform Act provides that all States must issue food stamp benefits using an Electronic Benefits Transfer (EBT) system by October 1, 2002, unless the Secretary provides a waiver because the State faces unusual barriers to implementing an EBT system. The EBT systems will ultimately replace food coupons. Currently, 42 States and the District of Columbia have operational EBT systems issuing food stamp benefits. Forty States and the District of Columbia use on-line systems that function similarly to debit cards used in ATM systems. Two States use off-line systems, the so-called ''smart cards.'' Thirty-nine of the States and the District of Columbia issue all food stamp benefits via EBT systems. Exhibit B presents the status of EBT systems in each of the 50 States and the District of Columbia. The Food and Nutrition Service (FNS) estimates that EBT systems now issue about 80 percent of food stamp benefits.
Nevada and Virginia have approved contracts for statewide implementation. California, Mississippi, and West Virginia have selected EBT vendors. Delaware, Maine, Montana, and Nebraska are in various stages from planning to considering bids resulting from requests-for-proposal. While the number of States with operational statewide systems is impressive, some States with significant caseloads are not yet operational statewide. For example, in California, only San Bernardino and San Diego counties have operational EBT systems, yet California accounts for $1.6 billion of the $15.1 billion in food stamp benefits issued in fiscal year 2000. California has selected a contractor for statewide implementation, but Alameda County will not roll out a pilot until August 2002, and Los Angeles County not until January 2003. At this point, it would not appear that California will meet the October 2002 deadline. Indiana, with fiscal year 2000 issuances of about $271 million, has just started its pilot, and Mississippi, with issuances of $226 million in fiscal year 2000, has selected a vendor, but the contract has not been approved.
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OIG'S AUDIT EFFORTS
OIG has taken an active role in monitoring and reviewing EBT systems, beginning in 1986 when we reviewed the Reading, Pennsylvania, EBT pilot project, the first in the Nation. We view our role as providing assurances to program managers that the systems are functioning as intended, or reporting problems that need to be addressed so that the systems operate properly. Reviewing these systems has been a high priority for OIG and remains so. OIG has reviewed systems in 23 States, concentrating on those that have large caseloads. Overall, our work has shown that EBT systems are working. Benefits in the correct amounts are going to the right people. However, some issues need to be addressed to strengthen controls.
From time to time, we have analyzed work completed at individual States and FNS's headquarters to assess whether there are trends that need attention at the national level. In January 2001, we reported the following:
Obligations at fiscal yearend were not accurately reflected in FNS's accounting records because of flawed methodology for expunged benefits. Current-year obligations for food stamp benefits were understated, and prior year obligations remained in the accounting system even though no longer available to recipients.
States did not always report the proper amount of expunged benefits within required timeframes. In fiscal year 1999, obligations were overstated in the FNS accounting system by $2.5 million.
We identified more than 180 individuals in 7 States whose access to the State systems should have been removed because their job duties changed or they were no longer employed.
FNS has agreed to address these problems.
Page 219 PREV PAGE TOP OF DOCEBT MAKES FRAUD DETECTION EASIER
OIG has supported the use of EBT systems to issue food stamp benefits. While EBT has not eliminated trafficking, it has reduced the amount of street trafficking and makes it more difficult for street traffickers to redeem program benefits. EBT systems provide an electronic record of transactions and have made it easier to identify stores that may be trafficking. They also readily identify the amount stolen from the program, which allows OIG to recover stolen funds through the use of asset forfeiture restitution. In addition, recipients involved in trafficking can also be identified, something not possible in the coupon system. As a result of EBT, more than 9,000 recipients have been removed from the program. From fiscal year 1996 to the present, we estimate that losses to the Government resulting from EBT-related fraud are approximately
$49 million. We have conducted 386 EBT-related investigations. The EBT investigations have resulted in 431 indictments, 354 convictions, and over $18 million in monetary results. During the same time period, the amount of total program fraud, including food stamp benefits issued through EBT systems and paper food coupons, is in the hundreds of million of dollars as documented by the Food and Nutrition Service and my office.
That concludes my statement Mr. Chairman. I would be pleased to answers any questions you or members of the committee may have.
Statement of Coeli Brunty
Hello. My name is Coeli Brunty and I am from Emmitsburg, Maryland. I am a 24-year-old, single, working mother of two boys, ages 3 and 5, and I am raising these children by myself. In order to do this, I have worked as a pizza delivery driver for James Gang Pizzaria for over 2 1/2 years. I commute 45 minutes each way to get to work and travel about 200240 miles a week delivering pizzas. I work 4 days a week and earn $7 an hour, plus tips, which sometimes may be only a dollar a day. Included in the $7 an hour is a gas allowance of $2.50 and I must pay all my work-related car expenses.
Page 220 PREV PAGE TOP OF DOC To manage my job and caring for my children, my sons go to school or Head Startand day care2 days a week and my mom watches them 2 days a week. For awhile I lived with my mom, but I applied for an apartment through Section 8 Housing and finally a two-bedroom apartment became available. So now, I am paying $164 a month in rent. This amount is based on my earnings, plus child support. I am supposed to receive a court-ordered child support for one of my children. But that check$64 a weekcomes only sporadically.
Right now, I am receiving about $ 170 a month in Food Stamps. What do Food Stamps mean to me? It means that I know my sons will never be hungry and that I can eat. I'm not sure we could make it without this help. Food Stamps are my safety net. When the child support checks don't come, Food Stamps mean I can buy milk, cereal and fruit for the boys to eat.
But, as a working parent, I do wish it were easier to get help from the Food Stamp Program. I have to visit the Food Stamp Office every 6 months to renew my Food Stamps. When I go to these appointments I have to drive 46 miles round trip, pay for gas and parking, and I usually have to stay for hour to an hourso I have to take time off from work. If less frequent office visits were required, I would not have to take off of work. Employers don't like having frequent time-offs.
I also have had problems at the Food Stamp office because of the car that I own, which is necessary for my employment. I am responsible for repairing and maintaining my vehicle, carrying car insurance and covering other unforseen car expenses. With my old car, during a 3 to 4 month period, I incurred repair costs of over $2,000. My employer then recommended that I purchase a reliable vehicle in order to keep my job. I bought a bottom of the line, no-frills, Kia Rio, with a $12,000 loan. This loan amount was needed in order to pay off the old car debt and purchase the new car. The bank required that I have a co-signer for this loan.
There is a limit, set by the Food Stamp Program, on the value of the car you can own, which I was never informed about. I learned that my Food Stamps had been cancelled because the car's value was over the limit. I appealed this decision and submitted information about the loan payments and a letter from my employer stating that a reliable vehicle is needed for my job. I had to wait 3 to 4 weeks to get definitive word that the decision was reversed and I could again receive Food Stamps. But the car still seems to be a source of contention because when I go in to do the periodic paperwork I am still questioned regarding my vehicle.
Page 221 PREV PAGE TOP OF DOC The Food Stamp Program means so much to me and my children, but if we could do something to make it easier for families like minewho are trying to balance working, children's schedules and visits to social servicesit would be a big help.
Thank you for the opportunity to talk to you today.
Statement of Bruce Wagstaff
Thank you for providing this opportunity to express California's views regarding the Food Stamp Program and its upcoming reauthorization. As a national ''safety net'', the Food Stamp Program plays a critical role in providing assistance for low-income individuals and families in need. Food stamp benefits may be the only difference between an adequate diet and hunger. As you know, there has been a great deal of discussion among States, advocates, and USDA staff regarding the future of this program. Conceptually, we believe that a broad overhaul is necessary. It is imperative that the program become much more accessible to needy families.
California differs from many other States in that the majority (73 percent) of its Food Stamp Program caseload also receives cash assistanceTemporary Assistance for Needy Families (TANF). This fact explains the concern and emphasis in my testimony with work and self-sufficiency. In California, we have had significant success moving families from welfare to work. Since the January 1998 implementation of the State's TANF program, CalWORKs, over 650,000 people have found jobs. Every aspect of our Federal welfare system has been altered to promote and support the movement of families from welfare to workwith the very significant exception of the Federal Food Stamp Program.
The Federal program, with its complicated eligibility and application requirements, has not been aligned with this movement, and has proven itself to be difficult to use by families who need its services, and by administrators who are charged with its operation. Many families who have just found jobs must try to take time off from work in order to apply; additionally, annual re-application with a face-to-face interview is also required.
Page 222 PREV PAGE TOP OF DOC The existing image of the Food Stamp Program is perhaps its greatest drawback. Its perception, as a welfare program, tends to stigmatize even the neediest recipients. Many eligible persons are reluctant to participate, many others decline altogether. The effort to ensure that all people in this country have the ability to meet basic food needs should not have a negative connotation. Reauthorization provides the opportunity to change the focus of the program to better meet the needs of the public. Characterizing the program as ''food security'' and as a ''work support'' would go a long way towards increasing participation of needy households, including working families.
The administrative difficulty of the program combined with recipient inability to understand and abide by complex rules must be addressed. Simplification must occur in every phase of the program. In particular, the eligibility and benefit determination process needs to be streamlined to reduce the administrative complexity that both acts as a barrier to participation, and increases the potential of payment errors. Along with this simplification, there also needs to be a corresponding increase in flexibility in order for States to be able to tailor a food security program that better meets the needs of their low-income families. Public human service programs can no longer operate by the ''one-size-fits-all'' model. Congress recognized this need through the establishment of the ''Simplified Food Stamp Program'' option in the 1996 national welfare reform legislation. However, strict Federal interpretation and application of that legislation, coupled with rigid cost-neutrality provisions, has made the option minimally useful.
We strongly urge that Federal waiver authority be expanded and States be encouraged to develop innovative approaches to administering the Food Stamp Program. Waivers should be evaluated on the basis of what works; if an idea works, all States should be able to take advantage without going through a lengthy and tedious approval process as is now the case.
Conformance with other programs should be allowed in significant areas that would streamline administration and help families in need, particularly working families. The recent legislation which allowed a State to apply its TANF vehicle policy to food stamps is an excellent example.
Page 223 PREV PAGE TOP OF DOC The program currently uses an intensive quality control process for determining payment accuracy as the single measure of successful performance. We acknowledge the importance of families receiving the correct amount of benefits. However, using this process to ensure that every aspect of eligibility is checked and rechecked may deter States from seeking out those families with the greatest need and preclude them from participating. While realistic program integrity measures should be a component of successful performance, other outcome measures consistent with program goals should also be considered. At a minimum, outcomes should include a measurement of the effectiveness of the program in serving low-income families.
For households who leave cash aid due to employment, food stamp benefits should become a major part of transitional services that assist these households to become self-sufficient and reduce the potential of returning to cash aid. In that regard, raising the minimum benefit levels for working families should be explored in tandem with an automatic transitional period of eligibility (such as three to six months). A transitional benefit option has been provided in recently issued Federal rules. However, the authority to implement this option is pending approval by the Office of Management and Budget.
While the Food Stamp Program does not provide adequate incentives for employment, it does have penalties for those who do not work. According to national studies, this has contributed to the decline in the caseload. There should be better incentives for employment. In administering TANF programs, many States have designed effective earned income deductions that are intended to recognize and promote an increase in earnings. In contrast, the current Food Stamp Program's 20 percent earned income deduction has been the same since 1986.
In regard to the availability of the program in providing food assistance to needy families, the issue of legal noncitizens must also be raised. With the passage of national welfare reform legislation in 1996, a significant number of individuals who had met all required immigration rules were denied continued access to the program. As a result, California along with 12 other States established a state-funded program in order to continue providing food stamp benefits for legal noncitizens not covered by the Federal Food Stamp Program. It is time to consider restoring Federal eligibility for all legal noncitizens, thereby eliminating the need and the resultant cost and administrative complexity of maintaining a separate State program in addition to the Federal Food Stamp Program.
Page 224 PREV PAGE TOP OF DOC A national ''food security program'' should play a more integral part in assisting today's low-income families in times of need. The impending reauthorization provides the perfect opportunity to effect needed change to make the program meaningful for the citizens of California and the Nation.
FORMULATION OF THE 2002 FARM BILL
THURSDAY, JUNE 28, 2001
House of Representatives,
Subcommittee on Department Operations,
Oversight, Nutrition and Forestry,
Committee on Agriculture,
The subcommittee met, pursuant to call, at 10:15 a.m., in room 1300, Longworth House Office Building, Hon. Bob Goodlatte [chairman of the subcommittee] presiding.
Present: Representatives Rehberg, Clayton, and Berry.
Staff present: Brent Gattis, subcommittee staff director; Kathleen Elder, Anne Hazlett, Ryan O'Neal, Anne Simmons, and Walter Vinson.
OPENING STATEMENT OF HON. BOB GOODLATTE, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF VIRGINIA
Mr. GOODLATTE. Good morning. This hearing of the Subcommittee on Department Operations, Oversight, Nutrition and Forestry to review the forestry programs in the context of a comprehensive farm bill will come to order, and I have an opening statement.
Page 225 PREV PAGE TOP OF DOC Today we convene the subcommittee to conduct part two of the hearing we held on June 12 to hear testimony on the forestry provision of the 2002 farm bill. In our first hearing we heard testimony from various forestry-related interest groups and organizations to hear recommendations for forestry provisions that should be included in the 2002 farm bill. Today we will hear recommendations from various government agencies tasked with implementing the various State and private forestry programs authorized through this legislation.
This subcommittee has the responsibility of determining what kinds of forestry provisions will be included in the next farm bill, and ultimately what the landscape of Forest Service programs available to private landowners will look like over the next decade.
As we look at a new farm bill, we have the opportunity to alter, keep, and create authorizations within the State and private forestry branch of the U.S. Forest Service, Natural Resources Conservation Service, and The Cooperative State Research, Education, and Extension Service. We must take this opportunity to closely examine those programs already authorized in past pieces of legislation and look at the present and future challenges to determine priorities for the 2002 farm bill.
Last summer we were all witness to the most devastating fire season in almost a century. We watched as fires consumed 7 1/2 million acres across this country. The media focused on the impact to the western States, and I will acknowledge that they took the brunt of the storm. But if you look at the number of States affected, you will find that this truly was a national incident and those fires burned not only on Federal lands but on State and private lands as well. Fire does not acknowledge ownership boundaries. Insects and disease do not acknowledge boundaries. We have a multitude of management challenges that cross boundary lines, and this is where our State and Private Forestry Programs reach out to communities and individuals to help solve these challenges.
I look forward to hearing from the witnesses their ideas about what has worked and what hasn't in past farm bills, and to hear about any new potential programs that may have a place in the upcoming bill.
Page 226 PREV PAGE TOP OF DOC I believe strongly that forestry should play an important role in the development of a new farm bill, and I look forward to working closely with all the interested parties to fully consider these programs, including and most especially the Ranking Member from North Carolina, whose timing is impeccable.
OPENING STATEMENT OF HON. EVA M. CLAYTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NORTH CAROLINA
Mrs. CLAYTON. Thank you, Mr. Chairman, for calling this important hearing. This is yet another hearing on forestry, indicating the importance and the seriousness and also the complexity and the interrelationship between forestry and our natural resources from many parts of our country. I join him in acknowledging that forestry should be an important part of the farm bill. I welcome you here and look forward to your testimony.
Mr. GOODLATTE. Thank you, Mrs. Clayton.
And now we are pleased to invite our first and only panel todayyesterday we had a hearing with five panelsso you will get extra special attention today: Mr. Michael T. Rains, Deputy Chief, State and Private Forestry, Forest Service, U.S. Department of Agriculture; Mr. Mark Berkland, Director, Conservation Operations, Natural Resources Conservation Service, U.S. Department of Agriculture; Dr. Colien Hefferan, Administrator, Cooperative State Research, Education, and Extension Service, U.S. Department of Agriculture; Mr. Eric Bendfeldt, extension agent, Environmental Services, Virginia Cooperative Extension Service, Harrisonburg, VA; Mr. Ronald Rohall, consulting forester, National Forestry Policy Committee, National Association of Conservation Districts, also of Washington; and Mr. Jim Hubbard, legislative committee chair, Colorado State forester, the National Association of State Foresters.
Page 227 PREV PAGE TOP OF DOC I would like to welcome all of you and point out that your written statement will be made a part of the record, and ask that you limit your oral testimony to 5 minutes, and we will begin with Mr. Rains. Welcome.
STATEMENT OF MICHAEL T. RAINS, DEPUTY CHIEF, STATE AND PRIVATE FORESTRY, FOREST SERVICE, U.S. DEPARTMENT OF AGRICULTURE
Mr. RAINS. Thank you. Mr. Chairman, Congresswoman Clayton, members of the subcommittee, it is an honor to be here. My name is Michael Rains. I am with the Forest Service, and my title is Deputy Chief for State and Private Forestry, and what I try to do is to help our partners in the States do a better job of managing and protecting use of their State and private lands.
While the Forest Service is not quite ready to outline our specific direction in forestry and the farm bill, we are working on that, we are formulating that position. And I would like to talk to you about some of the programs I feel confident that will help shape that direction.
The Forest Service has the primary responsibility for forestland stewardship with State and private forestry. That is our Federal role, and we are very pleased and honored to have that role. With 70 percent of America's forests in non-Federal ownership, goods and services that are reasonably priced for a growing America dramatically depend on the stewardship of these lands. And policies that are changing on public lands make the need for stewardship of those lands even more significant than ever before.
Our role is to provide a niche for every dollar that we invest on non-Federal land stewardship, we will probably leverage an additional $9 from State and local sources. So in summary of that point, we are not trying to fund the whole component. What we are trying to do is help States do things that, left to their own, they might not be able to do. And for the past 60 years we think we have been doing a pretty good job of that with our special partner, the State forester. We have many partners, but I want to be able to say, with a lot of rigor, that our special partner is the State forester, and they are a wonderful crew of State technical advisers that help us carry out our role.
Page 228 PREV PAGE TOP OF DOC Let me tell you a little bit about the non-Federal lands across the country. About 80 percent of the timber supply, at least domestic timber supply, can come from these lands. They generate almost 2 million jobs a year, they provide a home for almost all of the endangered species and threatened species, create a significant amount of economic impact, well over $100 billion a year, and I am awfully pleased to hear us talk about that it is national issue.
For example, in the Northeast and Midwest, about 40 percent of all the value added in wood products comes from the 20 States in the Northeast. Sometimes we forget to understand that on the eastern side of the country, forestry is a significant component of the welfare of the people and the economic stability of our communities.
A continuing strong Federal assistance role to keep these lands productive and sustainable is important. Our role, very specifically, is to protect our forests from insect and diseases, including weeds. It is to improve the health and sustainability of our forests and to protect communities from wildfires. In fact, the National Fire Plan that you have just talked toit was in response to the fires of 2000many have said that the small portion of the National Fire Plan called Community and Private Land Fire Assistance is becoming the catalyst that is holding that plan together.
Now, I don't know that I would go so far as to say that, but I will say that that component does help our State and non-Federal partners really become an incredibly important component to protecting communities in harm's way, and it really is a national issue.
And let me highlight that in terms of the South. Most of the wildland/urban interface, most of the number of fires and a significant amount of acres of fire is an eastern problem and not just a western problem. I would like to point that out because sometimes we might think that it, the National Fire Plan, is focusing primarily on the West. That is not the case.
Page 229 PREV PAGE TOP OF DOC Keeping our forests intact, for example, through the Forest Legacy Program, another program that we help administer, is a tremendous stewardship tool. That will be a component that will deserve looking at in the farm bill considerations. Our Fire Assistance Program, I have mentioned that. Our cost share programs with FIP and SIP are also very important ingredients to help landowners do a better job in their stewardship of their wood lots.
I would be remiss in saying that good science is an incredibly important part. Good technology transferand this is the bones that we have in State and private forestryyou are producing good technology transfer and providing incentives for landowners to do something that will help them get on with their business is incredibly important that we have good leading-edge science. So good applied research is important. That also will be a key consideration.
The farm bill is important for us and forestry is a wonderful companion component to that. And I am going to say and I have said many times, that forestry and the farm bill go hand in hand and they are very, very complementary, so highlighting and strengthening some of the programs that I have mentioned right now in the upcoming farm bill will absolutely ensure a sustainable forestry across America today. And if we are going to produce reasonably priced goods and services for a growing America, non-Federal land stewardship is incredibly important.
I think the other leaders of forestry across the country, Society of American Foresters, Extension, Soil and Water Conservation Districts, NRCS. All the other people you have heard from and you will hear from will also be complementary in that notion.
So in summary, I would like to thank you for holding what I think is probably the most important hearing that we will have maybe this year. Forestry, again, and the farm bill go very, very much hand in hand and are complementary. Maintaining the sustainability of American forests, all of American forests, is critical.
The work that you do is instrumental. The Forest Service would like to help. We are developing our direction now that will become clear soon, and we look forward to working with you on that direction and hope that you will consider it effectively.
Page 230 PREV PAGE TOP OF DOC This concludes my remarks, and after the rest of the panel, I would be delighted to answer any questions that you might have. Thank you very much.
[The prepared statement of Mr. Rains appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you.And now we will hear from Mr. Berkland.
STATEMENT OF MARK BERKLAND, DIRECTOR, CONSERVATION OPERATIONS, NATURAL RESOURCES CONSERVATION SERVICE, U.S. DEPARTMENT OF AGRICULTURE
Mr. BERKLAND. Thank you, Mr. Chairman, and members of the committee. I want to thank you for the opportunity to testify today on behalf of the USDA's Natural Resources Conservation Service on the forestry-related activities that are occurring on our privately owned forests.
My name is Mark Berkland. I am the director of the Natural Resources Conservation Service conservation operations. I have worked almost my entire career at the field level, most recently as State conservationist in South Carolina. In my field experience, I have found that forestland owners are always looking for ways to improve the productivity and sustainability of their forestlands and to find diversified sources of income from the products that they grow.
There are really two cornerstones of NRCS conservation activities. The first is our workforce and the second is our partnerships. Everything that we accomplish is contingent upon the talents and technical skills of our field people that are located in over 2,500 county-based offices. These people are trained professionals with technical tools and standards and specifications that are needed to get the job done. But probably most important is the fact that they provide assistance directly to landowners on site, and I think that is most important.
Page 231 PREV PAGE TOP OF DOC NRCS has always operated through a voluntary cooperative partnership with individuals, with conservation districts, with State agencies, and with local governments. At the State level there are two primary partners that we work with. There are a number of partners, but the two that we probably work the closest with in the forestry end of things are the conservation districts and the conservation agency and the State foresters.
Those partnerships have grown over the last few years and now serve as a prime example of how successful Federal, State, and local working relationships really can be. This relationship results in getting conservation installed on the land and that is the bottom line.
In addition, we accomplish our conservation goals by working with American Indian tribes, Alaskan Native Governments, and more than 300 resource conservation and development councils. Those councils are among leaders in fostering new technology to local forest industries and helping existing forest industries demonstrate new forest products.
The demand for technical assistance to install agroforestry practicesand that is really the intentional blending of agriculture and forestry products for economic and conservation benefitshas really grown in the last few years. So pastures, wind breaks, living snow fences, shelter belts, forest farming, and special applications such as treating wastewater are excellent agroforesty examples.
To increase timber production, the Forestry Incentives Program was authorized by Congress in 1978 to share the cost of tree planting and timber stand improvement and some other related practices on nonindustrialized private forestlands. The Federal share of these costs range up to 65 percent. The Forest Incentive Program is designed to share the expense with eligible landowners to produce timber. That program in fiscal year 2001 was funded at $6,325,000. Those funds we estimate will help us assist over 4,000 participants on over 150,000 acres of private forestland.
Page 232 PREV PAGE TOP OF DOC While some of the assistance will result in timber stand improvement, most of these efforts will result in trees planted, and that is kind of the bottom line. Since 1975 this program has helped landowners establish nearly 4 million acres of tree planting, and has completed 1 1/2 million acres of timber stand improvement.
The Natural Resources Conservation Service will continue to meet forest landowners' needs by workingby providing onsite conservation planning assistance and our partnering efforts with State agencies, conservation districts, and State foresters.
This concludes my testimony, and I will be pleased to respond to any questions as you wish.
[The prepared statement of Mr. Berkland appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you very much. And now we will hear from Dr. Hefferan.
STATEMENT OF COLIEN HEFFERAN, ADMINISTRATOR, COOPERATIVE STATE RESEARCH, EDUCATION, AND EXTENSION SERVICE, U.S. DEPARTMENT OF AGRICULTURE
Ms. HEFFERAN. Thank you, Mr. Chairman, for the opportunity to appear before this subcommittee. My name is Colien Hefferan and I am administrator of the USDA's Cooperative State Research, Education, and Extension Service CSREES is USDA's link to the university knowledge system across the country and the organization that engages that system to develop knowledge-based solutions to help farmers ranchers, private forest owners, and rural communities remain productive and profitable in the face of considerable challenges.
Our Agency supports research, extension, and education activities related to private forest through a combination of programs. The Cooperative Forestry Research Program, also known as the McIntyre-Stennis Program, provides formula-based support to State-certified institutions to train forest scientists in forestry and to investigate important questions about the conditions of private forest. As a formula program, the Federal investment in McIntyre-Stennis is matched, on average, at a rate of 9 to 1 with non-Federal funds, greatly extending the Federal investment of $22 million per year.
Page 233 PREV PAGE TOP OF DOC Since the program was established in 1962, it has trained thousands of scientists and supported research on subjects as diverse as the restoration of the fragmented Mississippi Delta hardwood forests, the development of improved forestry varieties, and certainly many environmental studies. One McIntyre-Stennis supported project, the New York Watershed Model Forest Program, devised forest management practices to improve the water quality of upstate New York reservoirs, preventing the need for an expensive water filtering system in New York City which would have cost over $5 billion.
The Renewable Resources Extension Act, or RREA, provides funding for the application of new knowledge through extension programs dealing with forestry and range resources. The $3.1 million per year is also matched substantially by non-Federal resources and supports our RREA through the State extension system. The priorities of the program include educating private landowners on issues ranging from improved forest management to reduce environmental impacts of harvesting to teaching landowners how to market their forest-based resources more efficiently.
One example in Kentucky trained loggers in harvesting techniques, which not only improved forest sustainability and water quality, but really led to 900,000 acres of healthier forestland and cleaner surface water.
A third mechanism we use to support forestry research is through the National Research Initiative which provides funding for basic discovery related to problems of national and regional importance in the environment, and in private forest we do this through a peer-reviewed competitive process.
Over the years, we have funded many, many projects. Just an example of one we have done last year, we have been supporting a project that is looking at the effect of insects, deer browsing and fire, on the failure of natural oak regeneration, and this is a project that is being completed through the University of Pittsburgh.
Page 234 PREV PAGE TOP OF DOC We also in the 1998 Agricultural Research Extension and Education Reform Act have a program which was established, called the Initiative for Future Agriculture and Food Systems, another competitively awarded, peer-reviewed program that supports research education and extension. Among the many awards from this program last year was a $4 million award to support a 3-State consortium of researchers and educators and extension specialists targeted at the needs of private forest owners in the central hardwood region of Indiana, Missouri, and Kentucky.
Taken together, these programs form a continuum of cutting-edge technology that supports our growing number of private forest landowners and the managers, but they are not stand-alone programs. As forest owners learn and understand more about their forests, they often need and desire assistance beyond our research-based educational programs. Therefore, the university-based programs must be complemented by the technical and financial assistance programs provided by the Forest Service, the Natural Resources Conservation Service, and the Farm Service Agency.
The university-based programs work closely with other USDA agencies to deliver timely and relevant programs. We have many examples of this, including a regional extension forester in the southeastern States, who is supported through a cooperative arrangement between the extension directors in the region and the State foresters in that southern region.
Land grant colleges and universities are also engaged directly in the Forest Service programs through their cooperative research activities. Many Forest Service scientists are located at land grant universities. Forestry, like agriculture in general, is a science-based global enterprise.
I would like to emphasize that the focus of our programs at CSREES is to support informed decision-making by private forest owners for both short-term and long-term activities. We think this improves self-sufficiency in their decision-making and substantially contributes to the sustainability of the 450 million acres of private forest in the United States.
Page 235 PREV PAGE TOP OF DOC Thank you.
[The prepared statement of Ms. Hefferan appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. We are now pleased to have with us one of my constituents from Harrisonburg, Virginia, Mr. Bendfeldt.
STATEMENT OF ERIC BENDFELDT, EXTENSION AGENT, ENVIRONMENTAL SCIENCES, VIRGINIA COOPERATIVE EXTENSION SERVICE, HARRISONBURG, VA
Mr. BENDFELDT. Mr. Chairman and members of the committee, thank you very much for this invitation to present testimony on how the Cooperative Extension System can help improve the sustainability of the Nation's private forests.
My name is Eric Bendfeldt. I am an environmental science extension agent with Virginia Cooperative Extension and am responsible for educational programming in five counties in Virginia's Sixth Congressional District. Those counties are Augusta, Bath, Highland, Rockbridge, and Rockingham.
Forest owners in the district are facing several issues and challenges, including water quality, stream site, forest protection, taxes and estate planning, conservation easements, and wildlife and pest management. Furthermore, without good planning and the involvement of professional foresters and loggers, many private forests can be high-graded and left in poor condition. Virginia Cooperative Extension is working across the State with private forest owners to address these issues.
Mr. Chairman, the issues and challenges that exist in the Sixth District in Virginia also exist across the country where approximately 10 million individual citizens own nearly one-half of the Nation's forest resource. The importance of maintaining the sustainability of private forests cannot be overemphasized. These forests provide important environmental benefits such as carbon sequestration, as well as 65 percent of the Nation's wood and fiber supply.
Page 236 PREV PAGE TOP OF DOC However, these forests are threatened by several factors, including increased harvesting pressure and decreasing public acceptance of active forest management practices. Informed decision-making by private forest owners is essential to sustainable forestry. The Cooperative Extension System is a source of research-based unbiased information and provides programs that actively engages landowners in adopting sustainable forestry practices. And studies have documented the importance of education in motivating landowners.
Within the USDA, the lead agency for the development and delivery of outreach education programs, is the Cooperative State Research Education and Extensive Service, CSREES. Through its university partners, the Cooperative Extension System has a presence in more than 3,000 counties, towns and parishes. Although CSREES programs provide the knowledge base for sustainable forestry practices, these programs have been poorly funded.
The National Coalition for Sustaining America's non-Federal Forest reports that USDA CSREES spends $3.50 per forest owner compared to $148 per farm. Mr. Chairman, just as the land grant system led American agriculture to prominence in the world, it is also positioned to do the same for sustainable forest management. The Extension Forestry Subcommittee recommends the development and funding of a comprehensive forestry program in the 2002 farm bill. The program should provide for outreach, research, technical assistance, and financial incentives.
Four specific recommendation for the committee's consideration are:
First, to reauthorize the Renewable Resources Extension Act and increase the appropriation level to $45 million. This would increase Cooperative Extension's capacity to deliver relevant and timely programs.
Second, expand the Cooperative Forestry Research, or McIntyre-Stennis Program, to be more inclusive of eligible 1890 land grant institutions. Research programs provide new knowledge, but extension provides the infrastructure to translate that knowledge into on-the-ground practices.
Page 237 PREV PAGE TOP OF DOC Third, provide a single forestry financial incentive program under auspices of one agency to better serve forest owners.
And, finally, establish a national advisory body under the Secretary of Agriculture to make recommendations on issues related to sustainable management of private forests.
In conclusion, Mr. Chairman, this committee has the opportunity to craft a comprehensive sustainable forestry program in the next farm bill. Private forest owners deserve recognition for their stewardship and the tremendous public benefit they provide. They deserve more support. Through the recommendations above, the Cooperative Extension System and its Federal partner CSREES can contribute to the sustainability of the forest resource through education programs that enhance informed decision-making.
Mr. Chairman, thank you again for this opportunity to present this testimony.
[The prepared statement of Mr. Bendfeldt appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you Mr. Bendfeldt. I appreciate your testimony. Unfortunately, I have been called away to a markup in another committee. I am going to ask the gentleman from Montana to preside. I hope to be able to get back, but whether I do or don't, you will be in capable hands. Thank you.
Mr. REHBERG [presiding]. Good morning. By way of introduction, I am Congressman Denny Rehberg from the State of Montana, so obviously I have a great interest in each and every one of the arenas that you deal with, and I thank you for being part of our hearing today.
We will move to Ronald Rohall, Consulting Forester, National Forestry Policy Committee, National Association of Conservation Districts in Washington, DC Mr. Rohall.
Page 238 PREV PAGE TOP OF DOC
STATEMENT OF RONALD ROHALL, CONSULTING FORESTER, NATIONAL FORESTRY POLICY COMMITTEE, NATIONAL ASSOCIATION OF CONSERVATION DISTRICTS,
Mr. ROHALL. Thank you. I appreciate the offer to be here today. As you mentioned, I am Ron Rohall. I am a district director in Westmoreland County, Pennsylvania. I am also serving as the first vice president of Pennsylvania Conservation District s, and I work as a professional consulting forester dealing primarily with private nonindustrial forestland owners.
In setting the tone for the next farm bill, Congress has the opportunity to elevate the importance of private land conservation by creating incentives to better manage and protect those lands. We believe that expanding voluntary, locally-led, incentives-based solutions will help America achieve its environmental goals. State, local and tribal governments, and private individuals own nearly two-thirds of the forested land in the United States. Since these lands are managed by millions of individuals with diverse goals and objectives, the Forest Service's Cooperative Forestry Programs are critical to helping maintain the health and ability of our Nation's forests to produce the values and products desired by the American people.
The public derives tremendous benefits from nonindustrial private forestland, and we need to ensure that these benefits continue to be realized. Of the 737 million acres of the forestland in the United States, close to half, more than 350 million acres, are nonindustrial private forestlands. The majority of these nonindustrial private forestlands are owned by the people who, for the most part, have a strong interest in managing their lands in a sustainable manner but often do not have the knowledge or resources to do this. Given that the management of these forests has a tremendous influence on our Nation's waters, watersheds, air, wildlife habitat, and timber resources, the owners of these lands must be provided with the resources they need to assure proper management of the resource.
Page 239 PREV PAGE TOP OF DOC Federal funding to help landowners implement sustainable forestry practices is currently far less than what is needed to sustain the resource. The two existing programs designed to provide financial incentives to nonindustrial private landowners, the Forest Service's Stewardship Incentives Program and NRCS's Forestry Incentives Program are seriously underfunded. In fact, Stewardship Incentives Program has received no funding in the past 3 years, and the President has requested no funding for the upcoming year. Further, neither of these programs provides sufficient flexibility for States to target their highest priority needs or tailor program management to their individual State administrative structures.
Given this background, Conservation districts recommend establishing a new financial incentive program to replace the Stewardship Incentives Program and the Forestry Incentives Program. This new incentives program should allow States to have greater flexibility in determining how to meet national, State, and local forestry management objectives.
Under Stewardship Incentives Program and the Forestry Incentive, contracts have maximum acreage limitations of 1,000 acres or, with a waiver from the State forester, up to 5,000 acres. We believe the States should have the latitude to set acre limitations that are appropriate for their needs. We also believe that States, in consultation with USDA, should have the flexibility to determine the percentage of funds spent for education and financial and technical assistance based on their own individual needs.
There is strong support for this concept in the forestry community. Conservation districts and other groups that work with nonindustrial private forestland owners, such as the National Association of State Foresters and the National Council on Private Forestry, have embraced the idea. We also concur with the National Association of State Foresters' recommendations to authorize funding for such an initiative at $100 million annually.
We believe the current array of farm bill forestry conservation programs is working well and needs to be continued and expanded. The Forest Stewardship Program, for example, helps nearly 10 million nonindustrial private landowners, who own 44 percent of the Nation's forestland, better manage and use their forest resources. The program is cost-shared with States and provides high-quality technical and stewardship planning assistance to landowners.
Page 240 PREV PAGE TOP OF DOC Under the Forest Stewardship Program, every State has developed and is implementing a comprehensive management program to ensure that private forestlands are managed under forest stewardship plans, long-term multi-resource management plans prepared under the Forest Stewardship Program.
A recent survey of landowners with forest stewardship plans indicates landowners with such plans are almost three times as likely to implement plans if they receive financial and/or technical assistance than if they don't.
Conservation districts recommend reauthorizing the Forest Stewardship Program and increasing its funding to $50 million annually.
Another important initiative is the Forest Legacy Program which helps forestland owners protect environmentally important forests that are threatened by conversion to nonforest uses. With ownership of small tracts of forestland, 10 acres or less, increasing rapidly, the Forest Legacy Program helps keep these tracts in forested uses by purchasing development rights while maintaining the right of public access. Operating on a willing seller/willing buyer basis, the program plays a vital role in preventing the fragmentation of critical forestlands. Conservation districts urge you to retain a Forest Legacy Program and increase the funding authorization to $50 million annually.
To wrap up, we also are concerned with the urban community forestry programs and we would like to encourage you to have funding at the $50 million level for also urban forestry and not just the rural forestry. Urban forestry issues are becoming extremely important to conservation districts.
So on behalf of the Nation's 3,000 conservation districts and 17,000 district officials, we appreciate the opportunity to provide our views to USDA forestry's conservation program s, and look forward to working with you over the next few months in strengthening these efforts.
Page 241 PREV PAGE TOP OF DOC [The prepared statement of Mr. Rohall appears at the conclusion of the hearing.]
Mr. REHBERG. Thank you. Our final panel member, Mr. Jim Hubbard, legislative committee chair, Colorado State forester, National Association of State Foresters, Mr. Hubbard.
STATEMENT OF JIM HUBBARD, LEGISLATIVE COMMITTEE CHAIR, COLORADO STATE FORESTER, NATIONAL ASSOCIATION OF STATE FORESTERS
Mr. HUBBARD. Thank you, Representative Rehberg, Representative Clayton. It has been more than a decade since we visited the forestry title of the farm bill, and in that time additional challenges facing the millions of forest landowners have occurred. The demands on the Nation's nearly 750 million acres of forest have increased. Population growth, of course, has generated sprawl, fragmentation of working forests. Public value shifts have placed increased awareness on sustainability. Increased assurance policy has generated increased demand for insurance of assurance of air and water and species protection. Federal land management changes have resulted in harvest levels on Federal lands reduced from 11 billion boardfeet to 2 billion boardfeet. And all of that has placed increased pressure on private lands for market commodities and for public benefit management practices.
We are at a juncture for America's forests. Most landowners don't have the information or the resources to deal with current policy.
The State foresters offer the following farm bill suggestions for forest sustainability:
First, a Sustainable Forestry Assistance Program, combining existing programs to adjust for today's demands and to provide additional focus in the delivery of these programs. We suggest a mandatory spending program for the long-term nature of forest management and offer that on a voluntary cost-incentive basis to produce those public benefits that are being requested, being required even, by policy.
Page 242 PREV PAGE TOP OF DOC Second, we propose a Watershed Forestry Program. This is to specifically address water quality issues. We have come to know TMDLs is an imposed problem on a lot of private lands. We think there is a better approach, a community-based approach that is not imposedtechnical assistance and grants on landscape scale.
Third, a Community Protection Program. This is a wildfire issue. This was created in the National Fire Plan and funded last year by Congress. It is the community and private land assistance piece of that appropriation. It is the critical piece for implementation at the local community and county level. It clarifies authorities and pulls together all the elements across boundaries of implementation of the National Fire Plan: preparedness, suppression, response, mitigation, and prevention.
I would also mention the Forest Legacy Program. It is important, with the population growth and sprawl, to maintain working forests in the face of that fragmentation pressure. And I would mention the conservation programs in the farm bill. We would suggest including sustainable forestry as a program objective in those programs.
State foresters believe that with technical assistance incentives and education, that we can deliver programs that have State flexibility for regional differences, and that our Nation's forest stewards, private landowners, will respond. The benefits will be forest health and sustainability, wildfire hazard reduction, fiber supply, air and water quality, wildlife habitat, carbon sequestration, and others.
Forestry in the United States more than anywhere else has the knowledge and ability to deliver this. We have the State-Federal partnerships in place that can achieve these kinds of program objectives, and our landowners have the ethic to respond to informed choice.
We have a chance through the farm bill to set policy that assures the future of America's forests, which may be our most critical natural resource, but that policy needs some adjustment. And we would offer the suggestions that I have made. Thank you.
Page 243 PREV PAGE TOP OF DOC Mr. REHBERG. Thank you very much.
[The prepared statement of Mr. Hubbard appears at the conclusion of the hearing.]
Mr. REHBERG. I would like to begin the questioning by asking a question of Mr. Rains. The 1990 farm bill authorized the formation of a forest resource coordinating committee that was to be tasked with the job of coordinating the many State and private forestry programs and extension services available to private landowners. As far as I know, this committee never convened. Is that true?
Mr. RAINS. Yes. It did not convene, and then there was a subsequent recommendation to create a Presidential commission or a panel, and that that panel would develop a study to review the rules of non-Federal lands and make some recommendations. Of all three components, the only thing that came to fruition was the special study where the National Research Council developed a report that basically described the roles of non-Federal lands and the Federal role and what it should be.
Mr. REHBERG. It seems as ifand I don't know if you were to be the catalystI have got prior experience in a similar situation as Lieutenant Governor of Montana. I cochaired the Montana Rural Development Council which was almost entirely funded with Federal funds, but there was some coordinating effort on the part of Federal, State, tribal, for-profit and nonprofit, for economic development in rural areas. It worked very well, it truly was partnership.
Why lose the impetus to want to do something that, one, Congress is willing to suggest, fund and believes is necessary in light of the oftentimes conflicting rules, regulations, and laws that exist between the Federal, State, and local private areas to solve a problem that we clearly have identified is necessary to protect our forestlands?
Page 244 PREV PAGE TOP OF DOC Mr. RAINS. It could have very well been that maybe people felt like there was some existing authorities and regulations and organizations in place. For example, one of the things in the 1990 farm bill was to create a Forest Stewardship Program. Every State then would have what is called Forest Stewardship Councils. Those councils were multipartnership-oriented; and, being able to develop the recommendations at the local level, the county level, the State level, those stewardship coordinating committees work really well.
So there might have been a question, did we really need a national body or a national commission to do that. I am not really sure that we do, because we do have a very, very strong State and Federal partnership that exists aggressively at the local level, and we are finding that most of our authorities are existing. We are finding that the resource levels need to be looked at, and we do have some authorities that might be able to be adjusted. But I honestly think at the local level we probably have plenty of organizational structure in place that is more than enough.
Mr. REHBERG. Perhaps I could debate you on this issue, but I would like to ask the rest of the panel, as we heard from the panel the necessity to either improve the appropriation or improve the dialogue or the coordination because of the existing fear that we are losing ground, do you agree with that? I just honestly believe that we need more coordination, and I don't find that to be particularly duplicative. Perhaps Dr. Hefferan or Mr. Hubbard from the State level.
Ms. HEFFERAN. Well, I can respond that we have been very committed to coordination on the programs that we work in in research and extension. And in fact in 1993, the Agency extended an invitation to the Forest Service to work with us on our FRAC committee, the Forestry Research Advisory Committee, and so for almost a decade now the Forest Service and CSREES have shared a common advisory committee to address issues of research priorities and
Page 245 PREV PAGE TOP OF DOC Mr. REHBERG. But do you have the structure to work within a Federal, State, local, tribal, for-profit, nonprofit?
Ms. HEFFERAN. That is just one part of our coordination. Most of the coordination that we work with the Forest Service is as Mr. Rains is suggesting, and that is on the ground at the county and State level. The Cooperative Extension System has a broad range of stakeholder input processes that are shared with local forestry, State foresters, and local forest officials. And for the actual delivery of programs, we depend heavily on that State and local coordination activity. And when it comes to the national priorities, we look to the FRAC, the Forestry Research Advisory Committee, as a joint effort across the Forest Service and CSREES to set those national research priorities.
Mr. REHBERG. Mr. Hubbard.
Mr. HUBBARD. Thank you. The State foresters do believe in policy coordination at the national level, with State involvement. But in all three oaf our recommendations for the farm bill, we are moving more towards a policy that says let's deal with this locally, let's establish a direction that says those programs will get general policy direction to accomplish the intent of Congress, and get it out to the local States and counties and communities, and that that then is handled at that level, and that we transfer that coordination collaboration to those groups.
Mr. REHBERG. Thank you. Mrs. Clayton.
Mrs. CLAYTON. Thank you, Mr. Chairman. Mr. Rains, when the Forest Service provides technical assistance in forest management planning, do you consult private landowners?
Mr. RAINS. Usually the way we do it is the Forest Service works with the local State official or the State forester. We provide, for example, forest stewardship funds to them, based on local needs and some criteria. Those funds then are either worked through consulting Forest Service foresters that work directly with the landowners in developing their stewardship plans, as an example; and then those stewardship plans have several measures in them that are based on the landowner objective, and then cost-share incentive programs come in to help cost-share those measures to fruition.
Page 246 PREV PAGE TOP OF DOC Mrs. CLAYTON. So you would make moneys available to Mr. Hubbard?
Mr. RAINS. That is correct. And we do.
Mrs. CLAYTON. And Mr. Hubbard goes down to Mr. Bendfeldt, I guess. Are you local or are you State?
Mr. BENDFELDT. Local.
Mrs. CLAYTON. You are local. So the coordination is presumed to be at the local level if the funds flow from the State.
Mr. RAINS. It really is. I want to just augmentI wasn't saying the lack of coordination at the national level is we don't want to do that. What I was trying to say is we have plenty of measures and coordinating committees and councils underway right now, and what I found, though, is that working through the State forester, the stewardship coordinating committees, and being able to have adequate resources to meet local level need is really the elixir for success.
For example, last year in just the Forest Servicenow in State and private forestry, we provided about $6.4 million through a variety of programs in North Carolina, much to do for what I call the stewardship of those non-Federal lands, from the Forest Legacy Program to stewardship programs to community and private land fire assistance.
Mrs. CLAYTON. Again, Mr. Rains, you mentioned the National Fire Plan. Let me mention a couple of them. The community fire planning, which is a component of the National Fire Plan, how do you work to prioritize the community involvement of the communities that you would focus or give funds to? The second part is the wilderness and urban interface; how do you define it and how are the services with those communities provided?
Mr. RAINS. The first thing in community and private land fire assistance, this year that fund was broken down into five different components. For example, one of those was the economic action program. Another was called multiresource stewardship.
Page 247 PREV PAGE TOP OF DOC Let me take the economic action program. What we would do is work with the State, the State would say here is what think our needs are with local projects, special emphasis projects. That is all based on local involvement and local need. They then voice that back to the national level, and then we fund that. So we literally fund those moneys directly to the State. They then contract that out through NGOs directly to other operators to get the job done.
Multiresource planning, as another example, pretty much the same way, based on need. So back-and-forth negotiation sets the priority, establishes the need. We then just fund through mechanism. So there is a good close connection.
Now the delineation of the wildland/urban interface is much more of an art than it is a science, and we have tried to set some distance in relationship to public lands and numbers of houses. And to be honest with you, we have worked with some criteria to establish what most people agree, at least for the first year of the National Fire Plan, is adequate for determination of the wildland/urban interface. And from that we have listed some communities in the vicinity of Federal lands, we have listed communities that aren't necessarily in the vicinity of Federal lands but will need protection from harm's way. Those communities, in fact almost 80 percent of those outside the vicinity of Federal lands, are really in the East. Like I said before, the East has a predominance of wildland/urban interface, which instinctively you would understand, and it is really important for us to focus those community and private land fire assistance programs to those communities in harm's way.
Mrs. CLAYTON. Who is the ''we'' when you say that?
Mr. RAINS. I am talking about my shop in State and private forestry at the national level working with Jim Hubbard in Colorado, and then Jim working with local officials in States and cities and towns basically. So the list that ended up in the register was a consultation with State agencies and local agencies.
Page 248 PREV PAGE TOP OF DOC Mr. RAINS. Yes.
Mrs. CLAYTON. How did the communities get involved in that?
Mr. RAINS. You know what I am going to doinstead of hogging this, I am going to let Jim Hubbard, because Jim Hubbard is actually involved in the listing of those in the vicinity of the Federal lands and outside, so he has got a better idea than I do.
Mrs. CLAYTON. So he should take the credit or the blame or whatever.
Mr. HUBBARD. And I get both. The States were tasked with the responsibility of providing the list, and virtually each State did it different. They all did it to a set of national criteria that was provided, defining what that risk should be, so that you knew which communities qualified. Some States already had assessments in place that had identified those communities. Others didn't. So it was a variety of methods, and communities were all contacted and communities know if they are on the list.
There were two listings, one in January and one in May. In January, a lot of communities did not want on that list. In May, communities did want on that list, and so the States dealt with what communities to submit met the criteria, that it was a State call. The communities were involved. I would say, though, that what was published in the Federal Register was a Department call. Department of Interior, Department of Agriculture. It is not the full list that the States submitted. It is a version that was screened for the criteria, and the definition of within the vicinity of Federal land was applied differently than the States did. So the States feel strongly that the full list belongs to them and the communities, and that should drive what happens in that State.
Nationally it takes on a little different flavor.
Mrs. CLAYTON. I will take another round.
Page 249 PREV PAGE TOP OF DOC Mr. REHBERG. Mr. Rains, I guess I don't want to be misunderstood as well. I clearly understand the difference between local input and local authority, and that is where the rub comes in. The importance of the coordinating committee is to have an opportunity to identify, through a collaborative effort or a consensus-based effort, inflexibility in Federal rules and regulations. By having you at the table we can point those out to you and perhaps get something done about it.
I would like to go back to Mr. Rohall for a minute and have you expand a bit upon your desire at a lower level, or a different level, to be free of some of the regulations or to have flexibility to manage your properties, perhaps out from under what you in your testimony have perceived to have determined an inflexibility of management opportunities.
Mr. ROHALL. Yes. At the local level, each county has a conservation district and the needs vary as we go across the country and even across States. Conservation districts would like to have the ability to utilize the funds that we currently do in some areas quite a bit, to be able to meet the needs of the local users. And you can get in some parts of the country, primarily an area like Montana where you might have very large landowners, where we have a limit of 1,000 acres for forest stewardship, you may wind up with the flexibility to have funds be available to landowners who are much larger; where in Westmoreland County where we have landowners that may have 35, 40, 50 acres 100 acres, and one or two very large landowners, we may want to limit it to smaller acreages to get the funds across. We would like to have the ability to work with our State foresters to be able to do those kinds of things at a State level.
But in a lot of areasand the testimony may have sounded a little bit like itbut in many years we do have flexibility to work, or we have the ability to work with the folks at the ground level. The local service foresters for the State, the local people we might work with out of the Forest Service, many times were hampered by rules from the national level, but working agreement, the ability to work at the local level is there, and I think we can expand on that in the farm bill with some more flexibility.
Page 250 PREV PAGE TOP OF DOC Mr. REHBERG. And my point being I represent ranches. In fact, my partner has BLM, Forest Service, State lands, U.S. Fish and Wildlife, other private lessees, and it seems like nobody else is helping coordinate.
Mr. Hubbard, to further my point, most recently had a Forest Health Round Table, both in Hamilton, Montana and a couple of months before that in Missoula, Montana. Again, this local input versus local authority argument was well made when it came to timber salvage and the fact that if you looked at a fence line between State land and Federal properties or tribal properties and Federal properties, the State and the tribal properties were already well underway for reclamation, planting, removing old, dead and dying trees, while the Forest Service is still studying the issue.
As we know, there is a clock and that clock is ticking, and if you truly care about the environment and rejuvenating that forest, the quicker the better.
How have you worked within the State of Colorado on trying to help the feds understand their inflexibility has created much of their environmental problems?
Mr. HUBBARD. More and more we are dealing with the landscape scale, and these issues, wild fire, forest health, insect and disease, exist on that landscape scale. So if you are not dealing across ownerships, you are not being effective in implementing your objectives. So if the private or the State property take action and the Federal lands don't, we still have a problem that affects everybody,so that local collaboration is becoming more important.
We understand that the Federal lands have an environmental clearance process that is more complicated, and we understand that they have to have the decision authority on those lands. But we do expect them at the table to collaborate on setting the objectives, and we think that that local collaborative effort that generates local support gives you a better chance of implementing your objective.
Page 251 PREV PAGE TOP OF DOC Mr. REHBERG. [presiding.] The joy of our Montana Rural Development Council was that it did exactly that, but it was paid for essentially by the Federal Government, and that is why I think thatand I hate to see the agency bail out so quickly on what I believe to be a good idea. But I guess maybe I am losing that argument.
Mrs. CLAYTON. The last panel we had there was general agreement that there was more need for technical assistance to the private landowners, and in many of your testimony you reaffirm the fact that the bulk of the land available happens to be in the ownership of private landowners. How would you foresee or suggest that we provide the technical assistance?
Now in some instances Dr. Colien Hefferan has said for the Extension Service that they are providing and in other areas we have had the local agents say that we need to certainly increase funding for the two existing programs we have now. But are there other suggestions that you have that would kind of complete the understanding of landowners? And also how would you help them complete their management plan for their own plots of land that they have? Anyone?
Mr. RAINS. I will give it a shot. There is no question about it, if we are going to make a significant impact on the percentage of landowners receiving some type of professional assistance, then technical and financial assistance needs to targeted, increased, and focused on key themes. That is one thing we could change right there, targeted, focused on key things. We try to do a good job at that. We can do a much better job at that.
Number two is we could probably and need to do more of this, expand our existing partnerships to do things: For example, in the National Fire Plan we have Fire Wise, which is an educational tool to help communities determine and implement a defensible space. The Cooperative Extension Service, for example, could do a marvelous job of that. We need to coordinate them into that zone a little more. In other words, a better cooperation between the Forest Service and the Extension is an example.
Page 252 PREV PAGE TOP OF DOC The delivery of technical assistance to help landowners specifically do the plan, we have got a pretty good system under way right now, but what we need to do is we need to have more Service foresters, we need to have more consulting foresters. But I also think we need do a much better job of reaching across Federal boundaries and having people with NRCS Extension come to mind dramatically, Soil and Water Conservation Districts. Those could be agents to help deliver the assistance that we need.
And I also would say, lastly, that maybe we ought to learn from things like we have done in Montana, where we actually have workshops where landowners come to bear and they become the teachers of other landowners to help develop their plans. As long as we have a theme, criteria, some benchmark level for what the plan should include, many people could come forward to do that. So those type of examples I think would certainly emphasize the numbers of plans and the focus of technical help.
Mrs. CLAYTON. At the local level there is a local forest ranger, right?
Mr. RAINS. Service forester, forest rangers, yes.
Mrs. CLAYTON. And he is the individual who is the hands-on from your agency, right?
Mr. RAINS. Actually typically wethe Service forester is usually assigned to the State.
Mrs. CLAYTON. The Extension Service has Mr. Eric Benfeldt as the local hands-on person, right?
Mr. BENDFELT. In Virginia within the Extension Service we have areawide Extension foresters that are working with private landowners in an educational role and in some cases one-on-one visits. But again it is an effort to coordinate and collaborate with agencies to
Page 253 PREV PAGE TOP OF DOC Mrs. CLAYTON. Have you a multi-county?
Mr. BENDFELT. Yes.
Mrs. CLAYTON. Usually there is an agent in the Extension that has sometimeshopefully for several thingsand in your case you have several counties. So you work with the ranger independently or you work the forest landowner independently or do you work in a collaborative way with the local ranger? Or do you do both?
Mr. BENDFELT. In most cases we try to work with the private forest landowner and determine what his objectives are first. And then from that, we seek tactical assistance from either the State Department of Forestry or possibly the Natural Resource Conservation Service. But first and foremost, it is trying to determine what those objectives are for the landowner and then go from there.
Mrs. CLAYTON. Let me describe something that is in my experience, and maybe mine is limited. But my experience has been I see land cut over and no attention given to that land by the forester or the Extension Service. And often times that landowner that is selling the land to whoever buys the wood is someone who lives north, is an absentee landowner. In fact, the absentee landowner may not even know how many trees it has.
He employs someone, someone comes to a relative and says, you know, you have value in your land, I want to buy the land. And oftentimes how I know about it is my husband is a country lawyer. He, like you in the Extension, has several counties in the rural area and they even up as clients. And nothing illegitimate about them cutting or wanting to cut, it is just the nexus to this technical assistance there of the vast number of private owners, many of them in rural areas, those who pay the taxes are somewhere else, they are absent from the land altogether.
Now, the tree forester or the one tree farmer is actively engaged or one who indeed is a local landowner. But there is an awful lot of land laying fallow with the value on the land, and they rightfully so want to use the assets from their land to pay the taxes. Does anyone give you any assistance on reforesting your land? I haven't heard from anybody. I just want to know how do we catchit is maybe an impossible task to suggest that someone who has multiple counties or the rangers who know these people, you know. And some of these lands are hotbeds for little fires later on, too, if they are not properly cut.
Page 254 PREV PAGE TOP OF DOC Anybody can answer that.
Ms. HEFFERAN. If I can add, within the Extension Service across the Nation there are 270 staff who have primary responsibility for forestry.
Ms. CLAYTON. How many?
Ms. HEFFERAN. 270.
Mrs. CLAYTON. Out of 3,000 counties.
Ms. HEFFERAN. Out of 3,000 countries. Like Mr. Benfeldt, there are people who have multiple counties for whom they are responsible or they have multiple duties in addition to forestry. I think the emphasis of the extension programs on citizen education, about the broad issue related to stewardship, conservation and management of the land gets exactly to the point that you are making. There are more than an estimated 10 million owners of private forest land. And these are parcels of land that are becoming smaller and smaller. I suspect there are people who don't even understand the management opportunities or the environmental impacts associated with the ownership of that land.
And so one of the goals of the extension programs is not simply focused on specific technical assistance as the Forest Service or NRCS provides, which is critically important, but also the broader education so that you can reach people and their neighbors and others so that they understand the implications of the management decisions that are made by these landowners.
You know, the educational process is often not quite as targeted, but may raise people's awareness so that they ask better questions, that they understand the options that are available to them. But it is a relatively small cadre of individuals addressing a very broad issue.
Mrs. CLAYTON. Well, I am glad to hear about the public education. Maybe we need to find out as we write the farm bill how do we emphasize that, because I think neighbors' understanding rather than the owners of the land will help facilitate this public understanding. And those absent, the neighbors who happen to be northern States, will be informed that there is an opportunity to do good and do well, get some money as well, to make sure you sustain it for your next generation as well.
Page 255 PREV PAGE TOP OF DOC Mr. BERKLAND. One of the things you mentioned or the question you asked is how do we catch some of those people who have small areas of woodland. There is a couple of suggestions that I might have. One is NRCS, Natural Resources Conservation Service, works real closely through Soil and Water Conservation Districts, as I know you are well aware. And through that relationship, the conservation districts, NRCS provides conservation planning assistance to landowners. And while it may not be targeted necessarily to those that have small tracks of woodland on their farms, we provide basically program neutral conservation planning, whether it involves wildlife, woodlands, soil erosion, water quality, you know, a broad spectrum of resource concerns, when we are working with those landowners. And one of the ways that we can and have in many cases kind of caught those people with the small acreages is brought to their attention that there are some things that can be done with that woodland. So we try to catch them through our normal conservation planning assistance. And of course we have people, staff located in 2500 offices across the country. So we do catch a lot of them. There is a lot of them. There isn't enough technical assistance obviously to catch all of them. But we do try to work with as many as we can.
Ms. CLAYTON. Thank you.
Mr. REHBERG. I am going to ask one last question of the panel by way of setting up the question to you. It's a philosophical question. Mrs. Clayton and I clearly have forests that grow at different rates. Ours are a little slower growing. I can't necessarily say our landowners are larger, but I suspect in the case of Montana they are larger. And so let's say Congress has a million to give to a land trust or conservation easement. Philosophically do you think that you would serve the environment, watersheds, the airshed and all, better by giving that million dollars to one company in Montana or obviously it with go further in a smaller ownership State and a faster growing State?
If you don't understand, I will try to better explain it. But I see us moving more towards Federal participation in creating conservation easements and land trusts on behalf of the environment. I see us having a greater involvement than before and many of the land trust organizations having less. And we are getting pressure now to give money to groups of people that are very large to keep them from doing something while their trees grow back so that they can reharvest it. And it seems to me like a little bit of a subsidization of some fairly large corporations. So my question to you is do you think the money goes father doing that in Montana or supporting Mrs. Clayton down in her home State? And you don't get to say both.
Page 256 PREV PAGE TOP OF DOC Mrs. CLAYTON. That was the easy answer.
Mr. REHBERG. Yes, that is pork.
Mr. RAINS. I will give a shot. You know, it is a very tough question. The first answer to it is, though, we have to do a much better job of targeting our technical and financial assistance to major themes. We are doing a great job of that, I think, in the National Fire Plan, where we are focusing on wildlife-urban interface areas and high risk, fire prone areas. So whether we give that to a larger landowner with slow growing trees or a smaller landowner with southern pine, I think the real question is we are targeting that assistance based on a need and a theme and we are then looking at things, like Jim Hubbard said, in a landscape level. What we don't want to do is give a million in conservation easements, for example, in the Forest Legacy Program and then go a hundred miles east with no relationship to the previous focus of dollars and give another million dollars. What we want to be able to do is look at themes and criteria based on a landscape level and then begin to target our funds. Whether that is small or large or fast growing or slow I think is a less issue than themes that are targeted.
Mr. REHBERG. Mr. Berkland.
Mr. BERKLAND. I think there arethat is a very tough question. I would like to say both obviously. And having worked in South Carolina, I can probably more clearly identify with Mrs. Clayton's situation than I can in Montana, having not worked in the West. But I think there, as Mr. Rains has said, there clearly is reason for trying to target and, you know, some decisions need to be made as to what we are really trying to accomplish. Are we trying to, you know, move towards carbon sequestration and looking at timber from that standpoint? If that is really the initiative that we are looking at, the faster growing area in North Carolina would have to be the area that we would be looking at. So I think we need to more clearly identify what we are really trying to accomplish with our targeting.
Page 257 PREV PAGE TOP OF DOC Mr. REHBERG. Dr. Hefferan.
Ms. HEFFERAN. Answering as a philosophical question, you didn't eliminate the option of neither, and I would like to raise that as an option. You know, I think our basic perspective is that improving our knowledge base and educating those who are managing the land is the most cost effective way to have better decision-making. I believe that landowners want to do the right thing, want to manage their property both for environmental impact and for the necessity of economic return. But oftentimes they don't have the full information and the research-based guidance to do that. So if I were looking to invest those dollars, I would invest them not in a specific conservation easement, but rather a broader based knowledge program. I think that is an effective approach.
Mr. REHBERG. Thank you. Mr. Benfeldt.
Mr. BENDFELDT. I guess also coming from Rockingham County and the Shenandoah Valley, the acreages and the farms are fairly small. I guess my initial response would be to help the smaller landowners. But I think conservation easements certainly have their place, but I think as funding programs go, we have to prioritize and try to see what the benefits will be on a site specific basis. I think in the Valley water quality is an issue. On a global effort the carbon issue is another thing. So I think it has to come down to what our goal is and what our long-term hopes are and go from there.
Mr. REHBERG. Mr. Rohall.
Mr. ROHALL. I would lean towards distributing the funds towards either smaller landowners or geographically so they could do it in smaller groups and looking at where there is a match, where there is a local watershed organization, a local land trust, a local group who are already working trying to meet the values there, whether a carbon sequestration, whether growing timber, whether it is watershed protection. What are the local issues that the local individuals want to achieve and what kind of match is there? What do the local people want? And I think that is the way it should go, where it gets the biggest bang.
Page 258 PREV PAGE TOP OF DOC Mr. REHBERG. Thank you.
Mr. HUBBARD. This isn't just a philosophical question. The State foresters deal with the U.S. Forest Service on this kind of an issue all the time. And it doesn't matter whether it is conservation easements, fire hazard reduction, forest health. How do we distribute those dollars to do the most good? Our position has been we want to be involved, Northeast, Southwest, involved with the U.S. Forest Service or whoever has those resources in determining how we are going to translate the intent of Congress that has established the policy theme to distribute those monies and then, please, allow the local flexibility there how to apply those monies.
Mr. REHBERG. Any further questions, Mrs. Clayton or Mr. Berry?
Well, thank you. We appreciate you being here. As I have said, I have the first ranch outside the largest community of Montana. I seem to be the experiment for a lot of governmental entities that want to showcase because it is easy for people to get from Billings to my property. And we have had a great working relationship, especially with the Living Snow Fence Project. I have got one that has been in place for about 10 years.
Mrs. CLAYTON. Why don't you explain to us what a living snow fence is. A hedge with a white
Mr. REHBERG. What is snow? From Congressman Berry we have to start clear back at the snow thing. A living snow fence is a determination on our part that we would rather look at trees than slats and wood and ugly stuff that are going to blow down anyhow. So a number of years ago the Department of Agriculture, working through the Conservation Districts and the Extension Service, asked a number of us landowners around the State of Montana where a lot of people would see it if we would try and experiment, where I provided the tractors, did the farming, cut the property up, they brought the tree planting equipment out, they provided the trees. And we tried different types of hedges in different locations. Thank God they didn't put Russian olives on my place. I hate them. They smell, and they usually look pretty ugly. We put junipers and caragena and such. We have a beautiful snow fence that keeps the snow from blowing onto the highways, from causing accidents. So the Department of Transportation got involved at the State and Federal level.
Page 259 PREV PAGE TOP OF DOC Mrs. CLAYTON. It isn't snow snow.
Mr. REHBERG. It is to keep snow off of highways, so it is a safety issue. It actually works very well. Now the experiment ended. As a result, the funding ended. But the Conservation Districts stepped forward and they have continued to maintain it because it was so successful. So I thank the Conservation Districts for doing that.
Thank you all again.
The Chair would seek unanimous consent to allow the record of today's hearing to remain open for 10 days to receive additional material and supplemental responses from witnesses to any question posed by a member of the panel. Without objection, it is so ordered.
This hearing of the Subcommittee on Department Operations Oversight, Nutrition, and Forestry is adjourned.
[Whereupon, at 11:35 a.m., the subcommittee was adjourned, subject to the call of the Chair.]
[Material submitted for inclusion in the record follows:]
Statement of Eric Bendfeldt
Mr. Chairman and members of the committee, thank you very much for this invitation to appear before you and present testimony on how the Cooperative Extension System can help improve the sustainability of the Nation's private forests.
My name is Eric Bendfeldt. I am an environmental science extension agent with Virginia Cooperative Extension Service and am responsible for educational programming in five counties of Virginia's Sixth Congressional District. The counties I serve are Augusta, Bath, Highland, Rockbridge, and Rockingham. I am a forest soils scientist by training, and I am presenting testimony on behalf of the Forestry Subcommittee of the Extension Committee on Organization and Policy.
My testimony today will focus on forestry challenges and issues in the Sixth Congressional District, the Commonwealth of Virginia, and the nation. There are several benefits of an education and information infrastructure such as the Cooperative Extension System that enables rural and urban forest landowners to make informed decisions.
Page 260 PREV PAGE TOP OF DOCFOREST RESOURCES IN VIRGINIA'S SIXTH CONGRESSIONAL DISTRICT
As the Chairman knows, his district consists of 3.8 million acres, of which 60 percent is forested. Private individuals own 800,000 acres of this forestland. In 19981999, they earned $21 million from the sale of timber.
Forest owners in the Sixth District face increasing challenges as public concern for the environment, including air and water quality, grows. The issues and challenges faced by the forestry and agricultural communities that need to be addressed include: watershed management, total maximum daily load requirements, land conservation, riparian buffers, taxes, conservation easements, and wildlife management. Furthermore, without good planning and the involvement of professional foresters and loggers, many of these forests are high-graded and left in poor condition.
Bill Braunworth, a tree farmer in Augusta County, relates forest management to vegetable gardening. He says, ''the forest won't produce the kind of products we need unless it is managed, just as a vegetable garden won't produce the food we need unless it is weeded and tended.'' He tells his fellow landowners that ''the only way to properly manage a forest is to get out and walk through it, walk every acre you have and see how it changes.'' Bill has forged this intimate and invaluable knowledge through four decades of forest ownership and participation in a variety of Cooperative Extension Service programs.
VIRGINIA'S PRIVATE FOREST RESOURCES
In the Commonwealth of Virginia, there are 15.4 million acres of forest, of which 77 percent is owned by 400,000 private individuals. Timber harvesting contributes $234 million to the State's economy. Virginia's forest products industry represents 9.2 percent of the manufacturing workforce with a payroll of $1.2 billion. The wildlife and forest recreational values contribute an additional $11.5 million to the State's economy. There are the additional quality of life benefits, including clean air and water, that are more difficult to place a dollar value on.
Page 261 PREV PAGE TOP OF DOC But a major concern across the State is forest fragmentation, whether it is the permanent conversion of forests to other uses, or the division of large tracts of forest into numerous parcels that are too small to manage for economic returns. Twenty percent of Virginia's landowners are over 65 years old and own 38 percent of the State's private forests. Much of this forestland will likely be converted or divided into small tracts.
In addition to fragmentation, other statewide issues include fire management, reforestation, water quality, and endangered species. The Virginia Cooperative Extension Service is working across the State with forest owners like Mr. Braunworth to address these issues through the Virginia Forest Landowner Education Program, Forestry Bus Tours, one-on-one problem-solving visits, seminars and short courses.
THE NATION'S PRIVATE FOREST RESOURCE
Mr. Chairman, the issues and challenges faced by Virginia forest owners are common throughout this nation. Approximately 10 million individual citizens, who own nearly one-half of the Nation's forest resource (448 million acres), are committed to ensuring that their forest lands are productive and healthy.
The importance of maintaining the sustainability of the Nation's private forest resource cannot be over-emphasized. Nationally, these forests:
Provide essential habitat to 75 percent of the Nation's fish and wildlife species, including many that are threatened and endangered;
Filter and store large quantities of high quality water for domestic, agricultural and recreational uses;
Provide 65 percent of the Nation's wood and fiber supply for a forest industry that accounts for 8 percent of the Nation's manufacturing base and involves significant interstate commerce and international trade;
Support a recreation industry in excess of $100 billion through boating, camping and tourism activities; and
Page 262 PREV PAGE TOP OF DOC Sequester huge quantities of carbon that would otherwise enter the atmosphere and exacerbate the global warming processes.
However these benefits and resources are threatened by several factors:
Major reductions in timber harvests on public lands that have resulted in increasing pressures on private lands where unsustainable logging practices often occur;
Division of large tracts of forest land into smaller parcels, resulting in loss of ecosystem processes that provide for clean water and air;
Growing per capita consumption of wood and fiber at rates that are higher than any other nation in the world;
Decreasing societal acceptance of active forest management practices that alter the landscape; and
Lack of awareness or knowledge by many private forest owners concerning management practices that lead to sustainable forestry.
LIFE-LONG LEARNING TO ACHIEVE SUSTAINABLE FORESTRY
Informed decision-making by private forest owners is the foundation upon which sustainable forestry practices are implemented. Without an understanding of the various management alternatives and their consequences, landowners have little to base decisions on other than advocacy positions offered by various interest groups.
The Cooperative Extension System is a source of research-based, unbiased information for private forest owners and provides programs that actively engage them in adopting sustainable forestry practices. Studies have documented the importance of education in motivating forest owners to implement forest management practices. Other studies have shown that forest owners who have participated in outreach programs tell neighbors and friends about the benefits of sound forestry and provide support, encouragement and information to their peers. This peer-to-peer learning has a multiplier effect in the adoption of forest management practices.
Page 263 PREV PAGE TOP OF DOC When placed in the context of a comprehensive forestry program in the 2002 farm bill, there is a logical connection between information, education, research, technical assistance and financial incentives.
LIFE-LONG LEARNING THROUGH THE COOPERATIVE EXTENSION SYSTEM
Within USDA, the lead agency for the development and delivery of outreach education programs is the Cooperative State Research, Education and Extension Service (CSREES). Through its State-based partners comprised of 105 land-grant colleges and universities, the Cooperative Extension System has a presence over 3000 counties, towns and parishes. Locally, Extension educators work in a variety of partnerships involving industry, forest conservation groups, State forestry agencies, local government, and professional organizations. These partnerships result in significant leveraging of Federal funds that reach many more forest owners than any single organization could.
As important as research and outreach education programs are as a foundation for sustainable forestry practices, support for private forest owners has been woefully under-funded. In a June 2000 report by the National Coalition for Sustaining America's NonFederal Forests, the following statistic is alarming: Based on 10 million private forest owners, USDA-CSREES's investment in forest resources equates to $3.50 per forest owner, compared to $148 per farm. Just as the land-grant system led American agriculture to its position as a world leader, it is also positioned to help ensure the sustainability of private forests. It is time for a significant commitment to this vital resource.
RECOMMENDATIONS FOR THE 2002 FARM BILL
While past efforts by Federal and State agencies and private organizations have demonstrated that real, on-the-ground forest resource improvements can be achieved, more needs to be done. To achieve the goal of sustainability on private forests, we recommend the development and funding of a comprehensive forestry program in the 2002 farm bill that provides for outreach, research, technical assistance, and financial incentives. This approach has been endorsed by the National Council on Private Forests, which represents 16 public and private organizations and agencies. The Extension forestry subcommittee supports and concurs with the Council's recommendations, and offers these four specific recommendations for this committee's consideration:
Page 264 PREV PAGE TOP OF DOC Reauthorize and expand the Renewable Resources Extension Act (RREA). RREA was enacted in 1978 with a funding authorization of $15 million for expanded Extension programming for forests and rangeland. RREA has never been funded at a level higher than $3.229 million. In order to achieve the national goals of sustainable private forests, RREA should be reauthorized and the appropriation level increased to $45 million. Every effort should be made to achieve full funding. An expansion of RREA with appropriate funding will provide the following:
Increased capacity at the county/town/parish level to engage private forest owners in educational programs that help them achieve benefits that accrue to their personal goals and the public good;
Expansion of forest and rangeland education programs through the inclusion of the 1890, 1994, and territory land-grant colleges and universities which will reach currently under-served and minority audiences;
Creation of a new Sustainable Forestry Outreach Initiative through which Federal funds can be leveraged with private, non-governmental organizations;
Establishment of Regional Sustainable Forestry Extension and Research Projects to conduct specific programs to conduct target programs that address regional issues (e.g., wildland fire, forest fragmentation and conversion, ecosystem restoration);
Development of distance learning initiatives for forest owners and the natural resources workforce which provides for learning anytime and anywhere.
2. Expand the Cooperative Forestry (McIntire-Stennis) Research Program. Extension and research programs are interrelated; research programs provide new knowledge and Extension provides the infrastructure to translate that knowledge into on-the-ground practices. These research funds are granted directly to land-grant colleges and universities on a matching basis; each Federal dollar leverages more than three additional State dollars.
Provide a single forestry financial incentive program under the auspices of one agency in order to better serve forest owners. Financial incentive programs are not the mission of CSREES, but they are an important function in a sustainable forestry program. Currently the Forestry Incentive Program (FIP) and Stewardship Incentive Program (SIP) are managed by two different agencies. This creates a fragmented program that is confusing to forest owners.
Page 265 PREV PAGE TOP OF DOC Establish a national advisory body under the Secretary of Agriculture to develop specific strategies and programs to implement the recommendations of the National Research Council report, Forested Landscapes in Perspective: Prospects and Opportunities for Sustainable Management of America's NonFederal Forests and the National Coalition for Sustaining America's NonFederal Forests report, Sustainable Forestry: Addressing the Stewardship of NonFederal Forests Through Research, Education and Extension/Outreach. This advisory body should consist of State and Federal agencies, forest landowners, forest conservation groups, professional foresters and the land-grant system. This body will advise the Secretary on a broad array of issues related to sustainable forest management on nonFederal forests.
Mr. Chairman, this committee along with others, has the opportunity to craft a sustainable forestry program in the next farm bill that could deliver a seamless and integrated program consisting of outreach information and education, research, technical assistance, and financial incentives. Private forest owners deserve both recognition and support for their stewardship practices and the tremendous public benefit they provide. But more needs to be done. Through the recommendations above, the Cooperative Extension System, and its Federal partner, CSREES, can contribute to the sustainability of the forest resource through education programs that enhance informed decision-making. Mr. Chairman, thank you again for the opportunity to provide this testimony, and I would be please to answer any questions the committee might have.
Statement of Russell Shay
Thank you for the opportunity to submit testimony on behalf of the more than 1,200 land trusts around the countrylocal and regional conservation nonprofits that work with private landowners to protect natural areas and other green space through voluntary methods.
Page 266 PREV PAGE TOP OF DOC We are pleased to submit this testimony on the future of important private forest incentives programs to be considered in the upcoming farm bill.
Private landowners are very important to the future of forest products and conservation. Only one-fifth of the Nation's forestland is in Federal ownership. Nearly 80% of non-Federal forestland is held by approximately 10 million non-industrial private forest landowners. The gross figures show that the acreage of non-industrial forestland in the U.S. is relatively stable. But beneath the overall figures is another story. One million acres of forest a year are lost to development, according to the USDA National Resources Inventory. Forestlands may be converted to farm fields, and those fields may be converted back to forest; but forests lost to development are not coming back.
Not all of those losses are critical. But some of them are. Some of the forests lost to development have important environmental functions as municipal watersheds or wildlife habitat that will be difficult if not impossible to replace.
Just as important to the Nation's forest resources, however, is the continuing subdivision of private non-industrial forestland into smaller and smaller parcels. Forest fragmentation erodes the economic viability of active management of those forests, and increases the likelihood that those lands will be lost to subsequent development. That development may further undermine the ability of adjacent landowners to manage their forestland cost-effectively, including managing it for timber. Development intruding into forestland can increase land taxes, complicate fire management, and greatly restrain management options for remaining forestland owners.
We strongly believe that the Federal Government has an important role to play in the stewardship of these private non-industrial lands. That includes helping landowners to plan and carry out scientifically sound management of those forests. And it also includes helping State and local governments ensure that the investment in good management is not lost because the forestlands are converted to other uses.
Page 267 PREV PAGE TOP OF DOC State and local governments are investing in keeping their forests. In 2000, there were 209 referenda placed on the ballot by State and local governments to provide public funds for protecting land by acquisition of fee title, or purchasing conservation easements. The voters approved 83% of those measures, creating more than $7.5 billion in funding for land protection. Those funds are not all for protecting forest landsbut this subcommittee can, by providing the resources that would enable the Forest Service to be a good partner to the States, help steer those State and local funds to help our forest land, forest landowners, and the forest industry that depends on them.
The best tool for this is the purchase of conservation easements on forestland. A conservation easement is a contract that prevents adverse development of land, and which can prevent subdivision, but which can allow traditional usesincluding silvicultural usesto continue.
Recommendation: Increase the Forest Legacy Program to $100 million annually
The Forest Legacy Program supports the purchase of interests (primarily permanent conservation easements) on environmentally important forestland to protect it from conversion to non-forest uses. Forest Legacy conserves forestland for traditional uses, including timber harvest, and provides willing landowners with an alternative to selling environmentally and economically important forestland for development. These grants require that at least 25% of the total project funding be from non-Federal sources. For a potential Forest Legacy project to be competitive, the non-Federal match is usually at least 50% of the total value.
At this time in 1999, there were 16 States and territories enrolled in the program. This year, there are 24 (California, Connecticut, Delaware, Hawaii, Illinois, Indiana, Massachusetts, Maryland, Maine, Minnesota, Montana, North Carolina, New Hampshire, New Jersey, New York, Puerto Rico, Rhode Island, South Carolina, Tennessee, Utah, Virginia, Vermont, Washington, and Wisconsin) with more on the way.
Page 268 PREV PAGE TOP OF DOC Since its inception in the 1990 farm bill, Forest Legacy has protected more than 207,000 acres of environmentally sensitive working forestland, and may make giant leaps forward in acreage in the near future, as a number of individual projects ranging up to 700,000 acres in size are now in progress. In Fiscal Year 2002 alone, the 24 States and territories enrolled in the program requested $222 million to protect 1.1 million acres of prime forest that is in danger of conversion to non-forest uses. However, the value of these conservation easements and other interests is more than $560 million, with the difference made up by States and private organizations, including land trusts. An additional nine States (Alabama, Alaska, Colorado, Georgia, Iowa, New Mexico, Oregon, Pennsylvania, and West Virginia) are likely to be accepted into the program this fall and qualify for fiscal year 2002 funding.
Increasing the Forest Legacy Program to $100 million annually is the minimum recommended to meet the need of Forest Legacy states by the Land Trust Alliance, National Association of State Foresters, The Nature Conservancy, Trust for Public Land, National Association of Conservation Districts, the Southern Environmental Law Center (representing the views of 14 groups) and many other organizations. The actual need may be far greater, particularly in areas such as the Northeast and Southeast, where a large percentage of industrial timber ownership is changing ownerships in a short time. There, the opportunity to keep land in large, economically manageable tracts is now, and if not taken, it may not be available in the future.
Increasing the Forest Legacy Program would enable States to tackle more projects, which together will start to show real progress toward the goals laid out in each State's Assessment of Need. It will also enable States to accomplish individual projects that are large enough in scaletens, or even hundreds of thousands of acresthat each project can, in itself, accomplish significant Federal purposes.
Recommendation: Create a Sustainable Forestry Assistance Program
Page 269 PREV PAGE TOP OF DOC We support the suggestions of the National Association of State Foresters to combine the Forestry Incentives Program and the Stewardship Incentive Program (FIP and SIP, respectively) into a Sustainable Forestry Assistance Program funded at $150 million per year. This cost-share program would allow non-industrial private landowners to become better stewards of the land by giving them access to financial, technical and educational assistance, and enable States to realize their forestry priorities on a landscape level. Land trusts, as private landowners, should be able to utilize this program.
On behalf of the Nation's more than 1,200 land trusts, thank you for considering the views of the Land Trust Alliance as you make your decisions on the forestry title of the coming farm bill. The funding you are able to provide can make a difference on the land for generations to come.
Statement of Mark Berkland
Mr. Chairman and Members of the Committee. Thank you for the opportunity to appear today and provide an update on the forestry-related activities of the USDA Natural Resources Conservation Service (NRCS).
My name is Mark Berkland, and I am the Director of NRCS Conservation Operations. I have served in the past as NRCS State Conservationist in South Carolina and in many capacities at the field level with the agency. In my experiences here and in the field, I have found excellent opportunities for forestry on private agricultural lands. Across the nation, farmers and ranchers are exploring forestry practices as ways to improve productivity, sustainability, and to achieve diversified sources of income for their operation. Often these practices include windbreaks, shelterbelts, alley cropping, and silvopastures to name a few. As farmers and ranchers come to NRCS for assistance, forestry practices often prove not only to be sound science, but good common sense conservation.
Page 270 PREV PAGE TOP OF DOC As you know, landowners across America are faced with ever-increasing pressures to maintain productive and profitable businesses. Landowners owning private forestlands provide our Nation with a variety of products. The demand for sawtimber, plywood logs, and quality hardwood logs continues to be strong. To meet the demand for these products, our existing forests must be managed to provide a flow of products now and into the future. Owners of private forests are willing to accept the normal risks associated with managing a forest tract over very long periods between income that often occur only once in a person's lifetime. However, they are largely unaware of the benefits gained by receiving technical assistance that can increase economic returns and enhance resources.
The public benefits from these private lands are great. Benefits include protecting watersheds, providing habitat for wildlife, modifying climate change by sequestering carbon from the atmosphere, and producing many other products we demand and enjoy such as maple syrup, mushrooms, and medicinal products. In addition, the revenue the owners pay in taxes support local governments and schools. These shared values have led to the development of Federal and State public forest programs that through a voluntary incentives approach encourage private landowners to retain and manage these lands.
We know that forestland owners want to be good stewards of the land. They know that stewardship is in the best interests of long-term productivity of their operation and want to leave improved natural resources and a better environment for future generations. Often, technical assistance is needed to help implement those goals. Our mission is to help private landowners meet the challenge of sustaining their natural resources while maintaining a productive and profitable business.
Today, I would like to highlight the many ways some of our conservation programs are making a difference around the countryside.
Landowners are using conservation to improve the productivity and sustainability of their forests, while also improving the asset value of their forest. Our programs are voluntary. In response to new environmental regulations at many levels, we are helping landowners meet some of the regulatory pressures they face. In turn conservation programs provide public benefits that go well beyond the edge of the forest. Mr. Chairman, I believe that conservation programs the Congress included in the 1996 Act, when coupled with our historic conservation programs, and the State and local delivery system are proven winners for the landowner, and the country as a whole.
Page 271 PREV PAGE TOP OF DOC Conservation Technical Assistance. The cornerstones of our agricultural conservation activities are the NRCS workforce and our partnerships. Everything we accomplish in this area is contingent upon the talents and technical skills of our field staff around the country. They are trained professionals with the technical tools, standards and specifications to get the job done. NRCS has operated since its creation through voluntary cooperative partnerships with individuals, conservation districts, State and local governments, which include State forestry agencies, and other Federal agencies and officials. That partnership may be even more important today if we are to meet the challenging conservation problems facing our Nation's landowners.
For more than 60 years, the NRCS has used conservation technical assistance to build a foundation of trust with people who voluntarily conserve their natural resources. Each year, the NRCS provides information, education, planning, and/or implementation assistance to more than 1 million land users. On average, the Agency's conservation assistance leverages more than $1 in contributions for every Federal dollar invested.
The demand for technical assistance to install agroforestry practicesthe intentional blending of agricultural and forestry production for economic and conservation benefitshas grown greatly. In addition to the practices mentioned at the beginning of my statement, forest riparian buffer strips, living snow fences, forest farming, and special applications such as treating wastewater are excellent agroforestry examples. The use of these practices will continue to increase as the ownership of forestland continues to be fragmented as well as to help address the wildland-urban interface. Agroforestry practices can be used to provide visual and noise screens, odor disbursement, lowering of forest fuels surrounding communities, as well as provide important additional and diversified income to landowners.
NRCS accomplishes its goals by working with 3,000 local Conservation Districts that have been established by State law and with American Indian Tribes and Alaska Native Governments. We also leverage our resources with the help of more than 348 Resource Conservation and Development (RC&D) Councils. RC&D Councils are among the leaders in fostering new technology to local forest industries, helping existing forest industries demonstrate new forest products that help to save local governments significant funds while retaining more jobs in their communities, and providing landowners technical information to manage forests.
Page 272 PREV PAGE TOP OF DOC Forestry Incentives Program (FIP). To increase timber production, FIP was authorized by Congress in 1978 to share the costs of tree planting, timber stand improvement, and other related practices on nonindustrialized private forest lands. The Federal share of these costs ranges up to 65 percent.
FIP is designed to share the expense with eligible, private landowners to produce timber. For the life of the practices, additional environmental benefits accrue including wildlife habitat and carbon sequestration.
Funding for FIP for FY 2001 is $6,325,000. With these funds 4,049 participants were enrolled with forest management plans on 151,015 acres of private forestland. Of this total, 117,026 acres of trees were planted, 23,709 acres of timber stand improvements were accomplished, and 10,230 acres of site preparation for natural regeneration was implemented. We would estimate that since 1975, landowners have established nearly 4 million acres of tree planting and 1.5 million acres of timber stand improvement through FIP. We cannot say, however, how many of those participants would have planted these trees without FIP assistance. The program targets funds to those landowners who are most likely to plant trees.
The Administration did not request funding for this program in the FY 2002 Budget. FY 2001 funding was provided in the context of emergency assistance. The Administration does not consider additional funding fir the FIP to be a high priority, with additional funding more appropriately targeted to higher priority conservation purposes.
Mr. Chairman, as exemplified through the many conservation programs and activities we have underway, there is a great deal happening on the ground. The public benefits are an improved quality of life, affordable and safe food supply, clean air and water, reduced damages from floods and other natural disasters, abundant fish and wildlife, scenic landscapes, and a sustainable resource base. We are proud of our accomplishments and look forward to working with you to build on all that we have done thus far. This concludes my statement, Mr. Chairman, and thank you again for the opportunity to appear. I would be happy to answer any questions the Committee might have.
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Statement of Jim Hubbard
Thank you Mr. Chairman for this opportunity today to present the ideas of the National Association of State Foresters (NASF) regarding reauthorization of the forestry provisions within the farm bill. It has been more than a decade since Congress considered significant changes to the forestry programs authorized under the farm bill, more commonly known as the State & Private Forestry programs. In that time, the land management challenges facing the millions of non-industrial private forest landowners in this country have shifted significantly as forest certification, domestic and global fiber supplies, and a greater emphasis on the sustainability of our forested resource has arisen. We have an obligation with the reauthorization of the farm bill to evaluate the position and update the relevancy of these forestry programs in light of these new challenges.
State Foresters have been integral in the delivery of these programs from nearly the start. As a group, the National Association or State Foresters has been around for over 80 years seeking to improve the vigor, the productivity and the resilience of our Nation's 747 million acres of forestland. As individuals, State Foresters have been working even longer to assist non-industrial private forest (NIPF) landowners to derive the highest public and private benefits possible from the 363 million acres they own manage. Ultimately, the success of State Foresters' efforts is highly dependent on the support of the Federal forestry programs authorized under the farm bill. My goal today is to share with you how these programs are operating, what changes need to be made to the programs and their funding levels, and whether new programs are needed to ensure forestry remains a vibrant component of our economy and relevant in our daily lives.
The Forestry Title. The Congress passed a forestry title in the farm bill for the first time in 1990, initiating and revamping programs such as the Forest Stewardship, Stewardship Incentive, Forest Legacy, Urban & Community Forestry and Forestry Incentives Programs. Since that time we have had great success in implementing the Forest Stewardship, Forest Legacy, and Urban & Community Forestry (U&CF) programs. However, over the last eight years, funding available to provide NIPF landowners with incentives to carry our conservation and forestry practices on their lands has shrunk to negligible and impractical levels. The Stewardship Incentive Program (SIP), once funded at over $14 million, has been zeroed out in recent years. The Forestry Incentives Program (FIP), initially funded at over $20 million, has been reduced to less that $6.5 million. In addition, conservation programs such as CRP that originally had a strong focus on forestry have moved away from tree planting in the last several years.
Page 274 PREV PAGE TOP OF DOC The reality we face today is that private forestland owners are under new pressures to produce a number of goods and services, some of which are reflected in market prices for wood products, while others, such as improved wildlife, air and water quality, are not. As timber harvests from the National Forests continue to decline, harvest pressures have increasingly shifted onto our non-industrial private land base, while development pressures have forced the cost of land ownership up considerably. Complicating matters, recent Federal rule makings under the Clean Water Act, the Endangered Species Act and others have placed significant burden on private landowners with process and unrealistic systems that were developed to tackle perceived problems on non-Federal forests, as evidenced by the TMDL rule.
The State Foresters want to work with you to develop a non-regulatory, incentive based approach to private forestlands that will ensure the best combination of goods and services. We hope to build upon the successes of the Forest Stewardship, SIP, FIP, U&CF, and Forest Legacy programs. To this end, we are proposing a non-Federal forestland stewardship initiative to address the enormous management, protection, and sustainability needs on private lands. Our initiative provides the basis for healthy, sustainable forests while continuing to protect private property rights. Well-managed non-Federal forests will help reduce urban sprawl and help provide reasonably priced forest products for a growing America. The bottom line is that participation by NIPF landowners in federally assisted State forestry programs ultimately delivers significant public value. We are not only guaranteeing a reliable source of fiber for the Nation's mills, but enhancing wildlife habitat, improving our air and water, adding to our carbon stores, increasing recreational opportunities, and generally adding to everyone's quality of life.
Non-Federal Forestland Stewardship Initiative
The three legs envisioned for this initiative are; first, and foremost, a revised landowner cost-share assistance program; second, a watershed forestry initiative; and third, enhancement of community portection from wildfire.
Page 275 PREV PAGE TOP OF DOC Our No. 1 priority for the farm bill is the Sustainable Forestry Assistance Program. This is a reinvigorated, flexible NIPF landowner cost-share assistance program that modifies the Forestry Incentives Program (FIP) by incorporating the best components of the Stewardship Incentive Program (SIP). A recent USDA Forest Service study revealed that NIPF landowners are three times more likely to implement forest management plans when financial incentives are provided. Although not terribly surprising, it does show how vital cost-share incentive programs are if the full value of these lands in timber, clean and abundant water yields, wildlife habitat and recreational opportunities are to be fulfilled.
Administered through USDA, the revamped Sustainable Forestry Assistance Program is a major step in protecting communities and the environment from wildfires as well as providing economic expansion and diversification for rural communities. Designed to encourage working forests, USDA would work directly with and through State Forestry agencies to encourage the long-term sustainability of NIPF lands by encouraging NIPF landowners to more actively manage their forests and related natural resources through financial, technical and educational assistance.
USDA would work directly with State counterparts to develop national and State priorities for practices to be cost-shared under this program as well as technical and educational opportunities. The program would allow States to consider organizing priorities along watershed or landscape level boundaries as well as to encourage landowners to work together on the appropriate scale.
The Program would allow for a range of forest resource improvement practices to be cost-shared. Assistance provided would focus on the establishment, restoration, and maintenance of forests and trees. Such practices would include: sustainable timber production, agroforestry practices such as shelterbelts and windbreaks; forest wetland and riparian area management, water quality and watershed protection and management; energy conservation and carbon sequestration; wildlife habitat improvement; invasive species management; forest fire reduction and recovery; and forest management planning.
Page 276 PREV PAGE TOP OF DOC In order to participate, landowners would be required to develop individual stewardship, forest or stand management plans that address site-specific activities. The plans would be developed in cooperation with and approved by the State Forester. Participants receiving cost-share would agree to implement and maintain such practices for at least ten years unless the State Forester approves a modification to the plan. Further, minimum and maximum acreage restrictions would be determined by each State Forester in conjunction with the State Stewardship Coordinating Committee. Finally, States would be able to cost-share up to 75 percent of a practice funded under this Program, but could choose to cost-share at lower rates in order to spread Program resources further.
What distinguishes this cost-share program from past cost-share programs is a program commitment to sustainability and a holistic approach to program delivery that provides financial, technical and educational assistance to private landowners in one program. To provide management and planning security, mandatory funding should be provided at a level of $150 million. Analysis has shown that half that amount of funding would impressively produce an additional 6.5 billion board feet of timber from non-Federal lands, as well as improvements to soil and water protection (500,000 acres), wildlife habitat enhancement (600,000 acres) and forest recreation enhancement (1 million acres).
An effective and adequately funded cost-share program is essential if we are to achieve our goals of maximizing the private and public value of non-Federal forest lands. Flexibility for States to craft an effective program to match each State's unique geographical and socio-economic characteristics will be key. A completed forest management plan is not of much value if not implemented. A workable cost-share program is the cornerstone.
Our second proposal is a Watershed Forestry Initiative to help the forestry community play a more proactive role in the prevention of water quality problems on forested lands and the improvement of both ground and surface waters. Prompted by increasing scrutiny and concern over the Nation's water quality, the Watershed Forestry Initiative will focus on improvement of forest management activities on all land uses in the field to protect water quality.
Page 277 PREV PAGE TOP OF DOC Whereas the Total Maximum Daily Load rule developed by the previous Administration represented a top-down, regulatory approach to water quality problems, the Watershed Forestry Initiative takes a different approach by working with landowners at the local level. By using the highly successful model of the Urban & Community Forestry program, the Watershed Forestry Initiative will give States capacity to plan and implement watershed-scale water quality improvement projects that will help cooperatively engage private landowners to improve the quality of waters flowing from their lands.
The Initiative is composed of three components to be administered by the USDA Forest Service and delivered by the State Foresters. These include watershed coordinators, watershed planning, and watershed and clean water grants. Watershed coordinators will be a focal point for integrating programs across mixed ownerships and building Federal and State capacity to deliver existing cooperative programs on a priority watershed basis. They will help to build new partnerships at the State and local level; provide technical guidance for water quality protection and restoration; develop collaborative watershed projects which can address critical conservation, restoration or stewardship needs in priority areas; provide forest resource data and support for State and local watershed planning efforts; and, work directly with the NIPF landowner on-the-ground to improve water quality.
Successful watershed planning and management depends on good information to assist groups involved in assessing watershed condition and developing solutions. The Watershed Forestry Initiative will provide watershed information to assist in the development of water quality standards and nonpoint source pollution control plans, provide forest resource information to local watershed councils, and support sustainable forestry Criteria & Indicators as well as the index of watershed indicators.
All this will come to life through the grant component of the Watershed Forestry Initiative. Through grants to States, communities, non-profit groups and landowners, the Forest Service and State Foresters will implement critical watershed protection, restoration, and stewardship projects. These grants will be used to protect drinking water supplies; demonstrate the value of trees and forests in watershed health and condition; restore fisheries and enhance waterfowl and other wildlife habitat; promote forest and watershed protection through community-based planning and action; restore stream side forests and establish riparian vegetative buffers; and, build new partnerships.
Page 278 PREV PAGE TOP OF DOC The essence of the Watershed Forestry Initiative is to empower the NIPF landowner, enabling him or her to improve the quality of water from the land by using trees and forests as solutions to water quality problems in urban and agricultural areas. Analysis has shown a need of $20 million exists, $15 million to fund the clean water grants component and $5 million to establish watershed coordinators and enhance planning.
Our third and final element of this Non-Federal Forestland Stewardship Initiative is Enhanced Community Protection from wildfire. The Cooperative Fire Programs of the USDA Forest Service are already authorized under the farm bill; the State Fire Assistance Program and the Volunteer Fire Assistance Program. These two programs ensure that State and local firefighters are trained, equipped and prepared to respond in a coordinated fashion to wildland fire threats. Through the help of Congress, these programs have saved millions of dollars, saved untold lives and provided communities added protection in the volatile and costly wildland-urban interface where homes and wildfire intermingle. Their continued support is essential to success. However, as evidenced by last year's devastating wildfire season and the expectation of another for this year, we need to ensure that our private forestlands are receiving the protection they need from wildfire. Now more than ever, particularly in the wildland-urban interface, fire hazards must be reduced.
The collaborative National Fire Plan that so many entities rose to support is the perfect example and first step necessary to see this through. With 80 percent of all fires occurring on State and private lands, the need for a strong Federal role in helping State and local governments promote safe and effective fire protection and suppression programs has never been greater. NASF is calling for adequate funding to address this issue by helping States, volunteer fire departments and communities develop leading-edge fire prevention, community response and suppression strategies.
Building upon the success of the Community and Private Land Fire Assistance line-item funded under the National Fire Plan, NASF supports the inclusion of Enhanced Community Protection from wildfires in the farm bill. Such an emphasis would increase investments in hazardous fuels treatments on non-Federal land to augment Federal projects that promote landscape level protection from wildfires. Treatments should use all the tools of the fire prevention toolbox; prescribed fire, mechanical removal, mulching, and chemical application. Usage of local contract personnel would be given priority wherever possible.
Page 279 PREV PAGE TOP OF DOC A multi-pronged, all-inclusive approach will be undertaken that would feature the use of incentives, outreach and partnerships. Enhanced Community Protection would be accomplished through increased use of incentives for communities and private landowners to address defensible space and fuels management needs on municipal and private property. Outreach and educational programs would be expanded to homeowners and communities to deliver the fire prevention message through the use of programs such as Firewise (www.firewise.org). And all throughout, partnering will be nurtured by augmenting the Federal role in promoting optimal firefighting efficiency at the Federal, State and local levels.
Added farm bill authorizations will provide the focus for existing programs and activities to realize these goals. The State Fire Assistance and Volunteer Assistance Programs will enable Firewise, fuel hazard mitigation/prevention and other special projects to take life. Enhanced invasive species management will help control unwanted species from hampering conflagration control efforts and help to re-establish natural fire regimes. The Economic Action Programs (EAP) will provide outlets for pilot projects, market development/expansion and improved wood utilization of fuel reductions. And finally, the Community and Private Land Fire Assistance provided in last year's Interior appropriations bill will help with fence reconstruction, hazard mitigation, multi-resource planning and community protection planning. We are getting closer to enacting a national cohesive, efficient and effective wildfire protection system, and authorization of an Enhanced Community Protection component in the farm bill will provide the keystone to it all.
Other Areas of Focus. Testimony by other forestry groups with a stake in farm bill programs has already been delivered to the Subcommittee at the previous hearing on June 12th. Many of these groups, including NASF, came forward through the National Council of Private Forests to promote specific changes to the farm bill all could agree upon. From those groups, it is noteworthy to highlight the testimony submitted by the Society of American Foresters. Beyond their accurate portrayal of many of the State & Private Forestry programs authorized under the farm bill such as the Forest Stewardship Program, the Forest Legacy program and the Urban & Community Forestry program, NASF would like to spotlight their statements regarding other important conservation programs.
Page 280 PREV PAGE TOP OF DOC Tremendous success has been achieved, and is expected to continue through such conservation programs as the Conservation Reserve Program, the Conservation Reserve Enhancement Program, the Wildlife Habitat Incentives Program and the Environmental Quality Incentives Program. However, NASF feels strongly that the public benefits of these programs would be improved by a recommitment to tree planting and forestry in general. Built upon the strong forestry components of the now defunct Agricultural Conservation Program (ACP), current conservation programs and the participating landowners would benefit immensely from increasing incentives to plant trees and to practice forestry on enrolled lands. Much of this could be accomplished through the inclusion of forestry in authorizing language putting it on par with current program objectives.
Our proposals here today are a combination of enhancement of existing authorities for some conservation and forestry programs, modification of forestry cost-share program language and introduction of new authorities to improve watershed and water quality protection. NASF's number one priority is to deliver authorities for an effective NIPF landowner cost-share assistance program, the keystone for well-managed and protected private forests that are healthy, sustainable and beneficial to society.
The capacity of the United States to produce continued renewable forest resources is significantly dependent on these non-Federal lands. Further, as policy changes on Federal lands are shifting harvesting pressures, adequate supplies of timber and other forest resources are increasingly dependent on the adequate stewardship of non-Federal lands.
The bottom line is that a NIPF landowner cost-share incentive program is needed now more than ever. In order for it to succeed, incentives have to be based on forest stewardship needs, targeted to State and local issues, flexible enough to meet varied conditions and contexts, and administered through the State Forestry agencies who have the expertise and delivery structure in place.
Page 281 PREV PAGE TOP OF DOC Thank you for this opportunity to provide testimony and we hope it has and will prove useful. We look forward to working with you in crafting the reauthorization of the farm bill.
Statement of Colien Hefferan
Mr. Chairman. Thank you for this opportunity to appear before the Subcommittee. My name is Colien Hefferan, and I am the Administrator of USDA's Cooperative State Research, Education, and Extension Service. CSREES is the agency of USDA which engages the national university-based agricultural knowledge system to develop science-based solutions and technologies to help farmers, ranchers, private forest-owners and rural communities remain productive and profitable in the face of considerable challenges.
Today I am appearing before the subcommittee to discuss the contributions that CSREES' programs make to the sustainability of the United States' expansive and diverse private forests. Working through the 105 land-grant colleges and universities and fourteen other forestry programs, CSREES supports the education of agricultural and natural resource professionals, the discovery of new knowledge by university scientists, and the transfer and application of that knowledge to solve real-world problems.
CSREES supports research, extension and education activities related to private forests through a combination of peer-reviewed competitive grants, formula funds and Congressionally determined priority projects. I would like to highlight four of these programs for the subcommittee.
The Cooperative Forestry Research Program, also known as the McIntire-Stennis Program, provides formula-based support to State-certified institutions to train new forest scientists in forestry and investigate important questions about the condition of our private forests. As a formula program, the Federal investment in McIntire-Stennis is matched, on average, at a rate of 9 to 1 with non-Federal funds, greatly extending the Federal investment of $22 million per year. Since this program was authorized in 1962, it has trained thousands of forest scientists and supported research on subjects as diverse as the restoration of fragmented Mississippi Delta hardwood forests, the development of improved forest tree varieties. One McIntire-Stennis supported project, the New York Watershed Model Forest Program, devised forest management practices to improve the water quality of upstate New York reservoirs, preventing the need for an expensive water filtering system, saving New York City over $5 billion.
Page 282 PREV PAGE TOP OF DOC The Renewable Resources Extension Act, or RREA, provides funding for the application of new knowledge through Extension programs dealing with forest and range resources. RREA provides the impetus for natural resource educational programming at the Nation's land grant colleges. The Federal investment in the RREA program of $3.1 million per year is matched 10 to 1 by non-Federal funds, increasing the reach and scope of the programs offered. The priorities and topics supported by RREA are determined by the individual State Extension programs, leading to locally relevant solutions. The program supports the development programs to educate private forest landowners on issues ranging from improved forest management to reduce environmental impacts of harvesting to teaching landowners how to market their forest-based resources more effectively. One example of an RREA supported project is the work done by the Kentucky Cooperative Extension Service to train loggers in harvesting techniques that protect forest sustainability and water quality. As a direct result of this work, logging practices have been improved on 900,000 acres leading to healthier forests and cleaner surface water.
The CSREES National Research Initiative funds basic discovery research on key problems of national and regional importance through a peer-reviewed, competitive process. In fiscal year 2000 the NRI awarded over $4 million for research related to the improved production, management and utilization of forest products. Grant awards are supporting research into:
fire regimes and ecosystem interactions at the University of Montana,
how the natural re-growth of commercially important canopy trees are inhibited by subcanopy evegreen shrubs at Virginia Polytechnic Institute, and
the effects of insects, deer browsing and fire on the failure of natural oak regeneration at University of Pittsburgh.
The Agricultural Research, Extension, and Education Reform Act of 1998 authorized the Initiative for Future Agriculture and Food Systems at $120 million per year. This program integrates research, extension, and education to explore and solve priority problems and has become one of our most popular grant programs, receiving over $1 billion in requests each of the past two years. One section of the program deals specifically with the needs of private forest and rangeland owners. Last year this program awarded $4 million to a three State consortium for research, extension and education programs targeting the needs of private forest owners in the Central Hardwood region of the US, Indiana, Missouri, and Kentucky.
Page 283 PREV PAGE TOP OF DOC Taken together with the support for research and extension through the Hatch, Smith-Lever, and 1890 institution formula funds and 1994 Land Grant programs these programs form a continuum of cutting edge technology, management solutions and education programs for the Nation's growing number of private forest landowners and managers.
But these are not stand-alone programs. As forest owners learn and understand more about their forests, they often need and desire assistance beyond the scope of our research, education and extension mission. Therefore, these university-based programs must be complimented by the technical and financial assistance programs administered by the USDA Forest Service, Natural Resources Conservation Service and Farm Services Agency.
University-based extension educators and research scientists work closely with other USDA agencies, particularly the Forest Service and Natural Resources Conservation Service, to provide relevant and timely educational programs. This is most evident at the State level, where extension educators work closely with State forestry agencies and district conservationists. In most cases this relationship works well, but we need to find ways to strengthen and expand our cooperative efforts.
There are many examples where Federal agency staff work very effectively with federally-supported university scientists and educators. For instance, the land-grant universities have had a long-standing arrangement with the Forest Service and State Foresters in the Southern Region. Together, the Forest Service staff and the extension educator develop and deliver programs that meet the needs of our mutual stakeholders. This model may be applicable for a nationwide cooperative effort.
Land-grant colleges and forestry programs are also engaged directly with the Forest Service in cooperative research programs where the projects are jointly planned, supervised, and funded. University scientists collaborate with forest service scientists at locations across the Nation on issues ranging from genetic improvement of tree species, development of new forest products, forest ecosystem management and fire risk reduction. In many cases Forest Service scientists are co-located on land grant university campuses. This arrangement provides the physical and human resources to conduct research programs that neither institution could undertake alone.
Page 284 PREV PAGE TOP OF DOC Forestry, like agriculture in general, is a science-based, global enterprise. As this subcommittee considers a forestry program for the upcoming farm bill, I would like to emphasize that the focus of our forestry programs at the Cooperative State Research, Education, and Extension Service is to support informed decision-making by private forest owners for both the short- and long-term. Informed forest owners who are passionate about stewardship of their resources and who become more self-sufficient in their decision-making are the future for sustainability on the 448 million acres of private forests in the United States.