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House of Representatives,
Subcommittee on Department Operations,
Nutrition, and Foreign Agriculture,
Committee on Agriculture,
Washington, DC.

  The subcommittee met, pursuant to call, at 1:12 p.m., in room 1302, Longworth House Office Building, Hon. Bob Goodlatte (chairman of the subcommittee), presiding.
  Present: Representatives Smith of Michigan, Foley, LaHood, Thune, Clayton, Thompson, Berry, Bishop, and Stenholm, [ex officio].
  Also present: Representatives Hilliard and Goode.
  Staff present: Pete Thomson, Dave Ebersole, Gerry Jackson, Kevin Kramp, Russell Laird, Vernie Hubert, Julia Paradis, Anne Simmons, Callista Bisek, assistant clerk; and Wanda Worsham, clerk.
  Mr. GOODLATTE. This hearing of the Subcommittee on Department Operations, Nutrition, and Foreign Agriculture to review the treatment of minority and limited resource producers by the U.S. Department of Agriculture is called to order.
  At this time I would like to welcome Mr. Hilliard with us today. And we're glad to have you here.
  Mr. HILLIARD. Thank you, Mr. Chairman.
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  Mr. GOODLATTE. The purpose of this hearing is to receive testimony and written statements reviewing the treatment of minority and limited resource producers by the U.S. Department of Agriculture.
  We will receive testimony from the General Accounting Office reviewing their January 24, 1997 report titled ''Efforts to Achieve Equitable Treatment of Minority Farmers.'' We will also hear from the Land Loss Prevention Program that will give a statistical representation paralleling the personal stories we will hear from the six producer witnesses on the second panel.
  I am not prejudging the Department of Agriculture on any of the cases we have read about in media reports or on the cases that will be presented this afternoon. I want to make one thing clear, however. Racism in any Government department, agency, or program is abhorrent, and it will not be tolerated.
  I want to say as a sideline that I came to this hearing from a hearing in the Judiciary Committee, on which I also serve, on minority church burnings, primarily in the South. And this type of racism in any form in Government agencies or on the part of lawless individuals should not be tolerated. And we hope that this hearing will play a role in exposing any such discrimination and leading us to the appropriate steps to root it out and destroy it.
  I've called this hearing because I am deeply troubled by the allegations of discrimination that some producers have publicized. It is my intention for this hearing to create a record detailing the allegations against the Department.
  Before we can attempt to answer the allegations through our oversight capacity, we need to hear firsthand the treatment experienced by some producers. That is the purpose of this hearing.
  We have assembled a broad spectrum of producers that will tell us the difficulties that they personally experienced with the Department of Agriculture. I look forward to hearing their testimony.
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  And I'd now like to recognize the ranking member of the subcommittee, Mrs. Clayton of North Carolina.
  Mrs. CLAYTON. Good afternoon. And thank you, Mr. Chairman.
  I join with the Chairman Goodlatte and other members on this subcommittee in welcoming the witnesses here to discuss this matter of national importance. This is the first hearing. A full committee hearing will be held at a later time to continue to our exploration of this subject.
  Farmers and ranchers are invaluable resources to all of us. American producers, who represent less than three percent of the population, provide more than enough food and fiber to meet the needs of our Nation as well as many nations overseas.
  By now it should be clear that it is not enough in the national interest to accept the elimination of the small farmer, the family farmer, the minority farmer, and the limited resource farmer in the name of progress.
  From 1910 to 1993, the number of American farms has declined from a little more than 6.4 million to a little less than 2.1 million, roughly a 70 percent decrease. And this decline is even greater in 1997. The decline in minority farmers is even sharper. In my home State of North Carolina, there has been a 64 percent decline in minority farmers, just over the last 15 years, from 6,996 farms in 1978 to 2,498 farms in 1992.
  There are several reasons why the number of minority and limited resource farmers is declining so rapidly, but the one that has been documented time and time again is the discrimination and discriminatory environment present in the Department of Agriculture, the very agency established by the U.S. Government to accommodate and to assist the special needs of all farmers and ranchers.
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  A General Accounting Office report, an Inspector General's report, and the recent report of the Civil Rights Action Team are just the latest in a series of Government initiatives examining the problem.
  The issue was first raised in 1965, when the U.S. Commission on Civil Rights established that USDA discriminated both in internal employment actions and external program delivery activities. An ensuing USDA Employee Focus Group in 1970 reported that USDA was callous in their institutional attitude and demeanor regarding civil rights and equal opportunity.
  In 1982, the U.S. Commission on Civil Rights examined this issue yet another time and published a report entitled ''The Decline of Black Farming in America.'' The commission concluded that there were widespread prejudicial practices in loan approval, loan servicing, and farm management assistance as administered by the Farmers Home Administration.
  However, as no improvement was forthcoming, in 1990 the House Governmental Operations Committee, chaired by my good friend Representative John Conyers, investigated this matter once again. In their report, entitled ''The Minority Farmer: A Disappearing Resource: Has the Farmers Home Administration Been the Primary Catalyst?'' the same conclusion was reached in 1990 as had been in 1982, that ''ironically, Farmers Home has been a catalyst in the decline of minority farming.''
  In January 1997, the General Accounting Office published a report entitled ''Farm Programs: Efforts to Achieve Equitable Treatment of Minority Farmers.'' While much of the report was inconclusive due to its limited scope, however, GAO did find instances of discrimination in fiscal years 1995 and 1996. GAO also found that the disapproval rate for loans was 6 percent higher for minority farmers than the 10 percent rate for non-minority farmers.
  The very next month, two related reports were released. The Office of Inspector General evaluation report for the Secretary on Civil Rights Issues and the Civil Rights Action Team report. The authors of these hard-hitting reports came to the identical conclusion as those who had looked at this issue 32 years previously: There are significant problems with discrimination within the Department of Agriculture.
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  In addition, back in November of last year, FSA Administrator Grant Buntrock stated in a public speech that ''We recognize there have been instances of discrimination in responding to requests for our services in the past, and we deplore it.'' The time has come, however, not just to deplore these occurrences. The time has come to put a stop to them.
  The farmers and ranchers of America, including minority and limited resource producers, through their labors sustain each and ever one of us and maintain the lifeblood of our Nation and the world through their efforts. Without these hard-working men and women, how could we be fed? How could we be clothed? These people do not discriminate for their products are for all of us.
  That is why, Mr. Chairman, it is so important that we do all we can within our power to ensure that each and every producer is able to farm without the additional burden of institutional racism rearing its ugly head.
  Secretary Glickman has said that he is personally committed to returning USDA to its original status as the people's department, who serves all people. Mr. Chairman, I share that goal and know that you and the others on this committee also share that goal.
  I look forward to hearing the rest of the testimony.
  Mr. GOODLATTE. I thank the gentlewoman for her comments.
  Does any other member of the panel wish to make an opening statement? The gentleman from Alabama, Mr. Hilliard.
  Mr. HILLIARD. Thank you very much.
  Mr. Chairman, according to the latest Civil Rights Action Team report, a 1965 U.S. Commission on Civil Rights report found discrimination at USDA in both program delivery and USDA's treatment of its own employees.
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  Similarly, a 1970 report found the same thing. A 1982 report found the same thing. A 1990 report by the Congressional Committee on Government Operations identified Farmers Home as ''one of the key causes of the drastic decline in black-owned farms.'' Of course, that agency is no longer in action.
  But, Mr. Chairman, a 1997 Civil Rights Action Team report concluded that USDA continues to discriminate against minorities, not only in the operation of programs, but in the approval of loans and against its own employees. In fact, according to this report, discrimination exists in virtually every agency, every program, and at every level of USDA.
  Mr. Chairman, this is a damning report. It indicates to us that previous administrations, Democratic and Republican, and previous Democratic and Republican Congresses have failed to fix the problem at USDA. The fact is USDA has been and continues to be the last plantation, and we should all be ashamed.
  Mr. Chairman, this committee must act. We must carefully review the recommendations of the Civil Rights Action Team. Where there is a legislative solution, we must work together to ensure that laws are adopted. Where there should be internal changes, this committee must vigorously monitor and press the USDA to make those changes. And we must act as overseers and make sure that the progress is made.
  Mr. Chairman, the conclusions held in this report and all of these other investigations let us know that racism cannot be washed away by sensitivity training. In order to eliminate the system with these types of problems, we must change the system. And sometimes we must remove people who discriminate. These measures call for drastic solutions. Ten years from now we cannot afford to have another report issued citing the same problems that have existed for more than half a century.
  Mr. Chairman, I look forward to working with you and the rest of my colleagues on this committee as we roll up our sleeves and get down to making USDA and USDA Farm Program accessible to all Americans on an equal playing field.
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  Mr. Chairman, I reserve the balance of my time for comments and questions. Thank you very much.
  Mr. GOODLATTE. I thank the gentleman.
  Does any other member wish to make an opening statement?
  [The prepared statements of Messrs. Stenholm, Canady, and Thune follow:]
  Mr. Chairman, thank you for holding this hearing, the first step in our process to review the status of minority and limited resource farmers and ranchers.
  I respect Mr. Goodlatte's wish to keep the focus at this initial hearing on the specific issue of the treatment of minority producers by the Department of Agriculture. I am hopeful however, that subsequent to this hearing, we can focus on the bigger picture facing limited resource producers and what the outlook for addressing their specific situation might be.
  I want to work with the groups represented here today and Secretary Glickman to ensure that everything that can be done to address the immediate issue of discrimination by USDA employees towards their producer customers. We must ensure producers do not feel intimidated or afraid to visit their local USDA office, in order to ensure that all producers have an equal opportunity to participate in any USDA programs they need to succeed in their agricultural operation.
  In the meantime, I look forward to the testimony of he witnesses that have assembled here today.
  As this subcommittee examines the very serious allegations of discrimination at the U.S. Department of Agriculture, I want to reiterate my support for the continued efforts toward a government that consistently treats its citizens in a non-discriminatory manner.
  Mr. Chairman, 3 decades ago the Federal Government was the forefront of the movement to end the Jim Crow laws, and with the Civil Rights Act of 1964, acted decisively to end discrimination based on race and sex in American society. Unfortunately, the Federal Government itself has strayed from that goal, and has instituted policies which divide Americans according to their race and gender. These policies in fact reinforce prejudice in our society.
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  Mr. Chairman, thank you for conducting this hearing concerning allegations that the Farm Service Agency of the USDA engaged in discriminatory practices against minority farmers. I am pleased that Secretary Glickman's office has placed a high priority on addressing this matter. Any act of discrimination should be met with the full force of the law. Neither the Department of Agriculture nor any part of the Federal Government should tolerate discrimination against any American by any employee or agent of the Government. It is the responsibility of the administration and the Congress to get to the bottom of he allegations which have been made and to take any remedial measures which may be necessary. I look forward to seeing this matter resolved in the near future.
  Today's hearing is indeed an important one. I am pleased to have the opportunity to hear from our distinguished panel of witnesses.
  In South Dakota the most prominent minority group are American Indians. Both tribal members and non-tribal members are actively involved in the farming industry. Under the U.S. Department of Agriculture, there are several agencies that provide important services to the agriculture community. Farmers and ranchers often use these services for credit and consultation. It is very important that equal access is available to anyone who wishes to participate in these programs.
  As a member of this subcommittee, I will continue to work closely with my colleagues on this very important issue.

  Mr. GOODLATTE. We would be pleased to invite our first panel to the table: Mr. Robert A. Robinson, Director, Food and Agriculture Issues, Resources, Community, and Economic Development Division of the General Accounting Office. Your statements will be made a part of the record, and we would be pleased to receive your testimony at this point.
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  Mr. ROBINSON. Thank you, Mr. Chairman, Mrs. Clayton, and other members of the subcommittee.

  Mr. ROBINSON. With me today is Fred Light from our Kansas City Office, who led the project that resulted in the January report.
  Mr. Chairman, this issue is obviously a very sensitive one. In recent weeks and months, the issue and the Secretary's response to it have received considerable media attention. In the interest of a historical perspective, however, I think it is important to recognize that the committee's and the Congress' concern about minority farmers is longstanding. In fact, in response to Congressional requests, we have issued reports addressing treatment of minority farmers dating back at least 6 years.
  Today I want to focus my remarks on our most recent report, prepared at the committee's request and issued in late January. For this work, we looked at three things: FSA's organization efforts to ensure that minority farmers are treated the same as non-minority farmers in the agency's delivery of program services, the representation of minorities on county office staffs and on county committees in counties with the highest numbers of minority farmers, and the disposition of minority and non-minority applications for participation in the ACP and the direct loan program.
  Before discussing our findings, I want to make it clear what we did and did not do in developing our findings. We focused our energies on gathering and analyzing data, records, and files. In other words, we concentrated on hard evidence that we could audit.
  We did not interview farmers or seek to develop anecdotal evidence. Also, we did not evaluate individual FSA employee behaviors. Where it existed, we compiled national level data. We supplemented this information with detailed reviews at five county and five district loan offices. We, of course, cannot generalize the findings at these local offices nationwide.
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  Our analysis encompassed activities taking place in fiscal years 1995 and 1996. Here's what we found. With respect to the organizational steps FSA was taking to ensure that minority farmers were treated fairly, we found that during fiscal years 1995 and 1996, FSA's civil rights staff investigated and closed 28 farmer complaints of discrimination based on race or national origin. It found discriminatory practices in two of these 28 cases.
  As of January 7, when we last updated our information, the staff had 110 such cases under investigation. The staff also conducted 13 management reviews of field offices and reported no evidence of unfair treatment.
  Additionally, the staff is providing civil rights training to all FSA personnel. And it expects this training to be completed at the end of this year. We did not evaluate the quality or thoroughness of the staff's activities.
  To examine minority representation among FSA staff and county committees, we identified the 101 counties with the highest number of minority farmers. In these counties, minority farmers make up about 17 percent of the farmer population. Thirty-four percent of minority farmers nationwide are in these 101 counties.
  Our analysis of FSA employees in these county offices showed that 32 percent were members of a minority group. Of these employees, 89 percent were either CEDs or program assistants. Finally, in 36 of the 101 counties, at least one minority farmer was a member of the county committee. Nationwide, as we reported, in 1995 about 2 percent of county committee members came from a minority group.
  Finally, I want to talk just a minute about our findings concerning the disposition of ACP and direct loan applications. Nationally, these programs have somewhat higher disapproval rates for minority farmers than for non-minority farmers.
  For ACP, the disapproval rates for applications in fiscal year 1995 were 33 percent for minority farmers and 27 percent for non-minority farmers. For the direct loan program, the vast majority of applicants, both minority and non-minority, are approved for loans.
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  However, approval rates were lower for minorities. Ninety percent of non-minority applications were approved, while 84 percent of minority applications were approved. In raw numbers, 286 minority loan applications were disapproved nationwide during fiscal year 1995 and the first half of fiscal year 1996.
  Our review of the files showed that, despite the higher disapproval rates for minority farmers, decisions to approve or disapprove applications were supported by information in the files. And FSA staff appeared to apply decision-making criteria to minority and non-minority applicants in a similar fashion.
  We also looked at the amount of time FSA takes to process applications for minority and non-minority applicants. We found that the processing time is about the same nationwide. From October 1994 through March 1996, FSA took an average of 86 days to process the applicants of non-minority farmers and an average of 88 days to process those of minority farmers, or a 2-day difference.
  Mr. Chairman, this concludes my prepared remarks. And we would be happy to address the questions.
  [The prepared statement of Mr. Robinson appears at the conclusion of the hearing.]
  Mr. GOODLATTE. Thank you, Mr. Robinson. We appreciate your testimony.
  Let me ask you—and because you are not with the Department of Agriculture, if you can't answer any of these particular questions, just let us know. First, I'm wondering if you can tell us who hires the Farm Service Agency's civil rights and small business development staff.
  Mr. LIGHT. That would be USDA. Those individuals are located here in Washington for the most part, and they're hired by USDA personnel.
  Mr. GOODLATTE. And that is made at the higher levels of the U.S. Department of Agriculture, I take it?
  Mr. LIGHT. Right.
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  Mr. GOODLATTE. And could you describe to me the procedure that a producer must go through to challenge a Department of Agriculture decision for treatment that he or she has received if they feel it has been discriminatory?
  Mr. ROBINSON. There are two ways that a decision can be challenged. No. 1, a decision can be appealed to the National Appeals Division or, alternatively or actually at the same time, a decision can be appealed to the civil rights staff if the decision is being challenged on the basis of discrimination.
  Mr. GOODLATTE. As of the report publication date, the U.S. Department of Agriculture hadn't decided on the compensation for the two producers that were discriminated against. Has the USDA decided on compensation yet for the two producers that your report detailed?
  Mr. ROBINSON. The last time that we checked, which I think was in early January, those decisions had not yet been made. I'm unaware of whether decisions have been made in recent days.
  Fred, are you aware of any?
  Mr. LIGHT. No, I'm not aware of any other than in the civil rights report. I think that they mentioned that within 120 days, they are supposed to make decisions on compensation for all of those cases that are pending out there.
  Mr. ROBINSON. It's a little difficult for us to answer some of these questions.
  Mr. GOODLATTE. I take it, then, that you also don't know whether any punishment had been decided for the employees that participated in the discrimination.
  Mr. ROBINSON. No, sir, we're not. At least I'm not aware of any.
  Mr. LIGHT. My understanding of one of the cases that was in Virginia is that that employee was—the first step was that he was demoted and later left the Department. I'm not aware of the situation in the other case, if any punishment was given.
  Mr. ROBINSON. But, again, I want to make it clear that we're not monitoring these actions in any great detail since issuance of our report.
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  Mr. GOODLATTE. Very good. Do county committee employees approve the loans themselves? Are they involved in that approval portion of the process?
  Mr. ROBINSON. Loan applications' final decisions are made by the FSA employees. I think the county committees get involved, at least in some of the earlier stages of the approval process, but the final decision is made by FSA employees.
  Mr. GOODLATTE. I'll yield to the gentleman from Mississippi.
  Mr. THOMPSON. It looked like you said two things. I mean, explain it again.
  Mr. ROBINSON. Sure. Currently, in the current processes, now that FmHA and ASCS have merged into FSA, loan decisions, final loan decisions, are made by the FSA employees.
  Fred may be able to talk a little bit more because he was actually in the county offices. He can talk a little bit about the specifics.
  Mr. LIGHT. During the time of our review, essentially none of the county committees, the elected farmers, made any decisions on the loans because the old Farmers Home County Committee was abolished during the reorganization. And the old ASCS County Committee was still not up to speed yet on what was going on with the loan process.
  So during the time of our review, the Federal employees of FmHA who moved to FSA were the ones who were doing all of the eligibility tests, credit checks, and making the decisions on the loan approvals.
  Today, the FSA county committees are now starting to make some of the determinations about whether a farmer actually resides in that county office, whether or not their credit is good, and whether or not they have the managerial skills necessary. Those are the three eligibility requirements that the county committee now is involved in.
  Mr. BISHOP. Will the gentleman yield?
  Mr. GOODLATTE. I'll yield.
  Mr. BISHOP. Thank you.
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  Prior to the time that you undertook your study, before the reorganization, before the consolidation, did the respective committees make the decision at that time?
  Mr. LIGHT. My understanding is they only made decisions based on the three eligibility criteria, which was that you are a farmer in that particular county, that you have the managerial experience necessary to undertake the loan and that you have good credit.
  Again, all of those decisions as to whether or not you were eligible to get the loan based on the cash flow and the collateral-type activities. All of those activities were done by Federal employees of FmHA.
  Mr. BISHOP. So that means that unless the county committee determined that you were creditworthy or unless the county committee determined that you had the managerial skills, your application would not be advanced to the eligibility status.
  Mr. LIGHT. Yes. The credit report is essentially done by the Farmers Home Federal employees. I mean, the Federal employees would gather the information and then present it to the county committee. And then they would make that decision based on the recommendation of the FmHA employees.
   But all of those activities ended when the Farmers Home county committees went out of existence.
  Mr. BISHOP. But now you're saying they've reentered that——
  Mr. LIGHT. That's my understanding, which is now the old ASCS county committees are now making some of those determinations on loans.
  Mr. BISHOP. So at the time of your report, it was sort of a period of hiatus so that you really were not capturing what the real history and what the real custom and practice had been over the years with regard to the USDA applications in this whole process?
  Mr. LIGHT. One of the reasons that we only looked at the time period that we did is because we wanted to capture what was currently going on. We didn't know what was going to happen with the county committee structure in the future.
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  At the time of our review, the old ASCS county committee was not involved. We didn't know what was going to happen with that.
  Mr. BISHOP. So the value of your report to us, then, is only the value of what was happening between the old county committees and the now existing county committees?
  Mr. ROBINSON. I think we made a very strenuous effort to make sure that the scope of our work was laid out very clearly. It governs only that time period and only the events during that time period. I'm not sure that the facts are any less meaningful today.
  Mr. BISHOP. Well, you haven't undertaken a study today, though.
  Mr. ROBINSON. The scope of our examination, of course, ended in fiscal year 1996. That's correct, sir.
  Mr. GOODLATTE. My time has expired. I recognize the gentlewoman from North Carolina.
  Mrs. CLAYTON. I want to thank you for your report. I think just to recapture what I understand the scope and breadth of your study was that you went to five county offices, five district offices in five different states. Is that correct?
  Mr. ROBINSON. We looked at national data where national existed. And we supplemented that with five county offices, five district loan offices. And we selected those ten on the basis of two primary factors: number one, a higher disparity rate, statistical disparity rate, a higher disapproval rate than between minority and non-minority or a high number of minority farmers. We're trying to get as much coverage as we could out of an admittedly small sample.
  Mrs. CLAYTON. Well, I want to say I think, although it was limited, that the report, although it's inconclusive also, does establish the foundation for which other reports can build on. So it is a building block that we have the advantage of given, as you put it, some context. There are three reports: your report, Inspector General's report, and now the Civil Rights Action Team report. And, therefore, I just want to put this in some context.
  Although you have 28 cases you found that were apparently dealt with by the Civil Rights Office of FSA and only two of them found to be discriminatory, put that in context as a building block that there shouldn't have been one act of discrimination.
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  Mr. ROBINSON. Well, there's more evidence than that. There is a statistical disparity in the nationwide approval rates of ACP applications. There was a statistical disparity in the approval/disapproval actions on direct loans. I think we bring that to the table from a national factual basis.
  Mrs. CLAYTON. You do.
  Mr. ROBINSON. I should mention that we worked pretty closely with the committee and the committee staff in trying to decide what our scope should be. And the thing that I think especially the staff felt were most lacking was hard reviews of hard files.
  I think everyone felt that they were awash in statements and positions, but what we thought we could bring to the table, at least within the limited number of cases where we could go out there and actually look at files, that's what we tried to bring to the table, in addition to whatever national data was available.
  As I'm sure you're aware, national data is very often hard to come by.
  Mrs. CLAYTON. Yes. I can appreciate that, but I think two members here have cited some historical perspective. There was a lot of factual and evidentiary data, although you were trying to look at things that were alive right now. And I can appreciate that.
  Mr. ROBINSON. As an audit agency, we want to look at things we can audit.
  Mrs. CLAYTON. Well, given your criteria, I was a little amazed as to how you selected Glacier, MT, and Dooly, GA if you were looking for——
  Mr. ROBINSON. Yes, ma'am. I can certainly talk a little bit about that. We had done three counties each, three district loan offices and three county offices. The committee felt that we needed some representation or some discussion of location, where Native Americans were the primary minority That explains Glacier, MT.
  Mr. ROBINSON. Dooly, GA, has a significant minority population. But also, quite frankly, in trying to manage our work, it was reasonably close to our Atlanta office, where we could get to it right out of the box pretty quickly just to get a feel for what kind of files existed, what files didn't exist.
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  Mrs. CLAYTON. It was a point of convenience; right?
  Mr. ROBINSON. And that was the first office we looked at.
  Mrs. CLAYTON. You agree it was a point of convenience; right?
  Mr. ROBINSON. A point of convenience, certainly that's true, but also it had a significant minority farmer population.
  Mrs. CLAYTON. Well, help us understand when you say that the percentage of participation of minorities on the committees. What was significant to your finding in that area?
  You looked at the rate of loans. You also looked at how the staff dealt with those that were filed, a discrimination. You looked at the rate as well of direct loans. And you also looked at employees in the overall makeup of these committees.
  I would like for you to explain a little further in terms of what you thought was the significance of your finding in terms of minority participation in the committee.
  And I thought I recalled your saying there was about 69 percent of people who were minorities who either were CEOs or directors in the Farm Service Agency. I was pleasantly pleased to find that, but I just want some further information bearing that conclusion.
  Mr. ROBINSON. Yes. Back in 1995, at the behest of the committee, we did a national assessment of minority representation on county committees. We found that minorities represented roughly 5 percent of those eligible to vote for county committee members and that ultimately only 2 percent of the county committee members were made up of minorities. So we had national data that we had reported on previously.
  What we wanted to look at in this case is at least those 100 counties—it turned out to be 101 because there were some ties—representing the highest numbers of minority farmers.
  What we found there and what we reported was a 34 percent. Thirty-four of the 101 counties had at least one county committee member, 62 minority county committee members, in total, or 22 percent of the total county committee members were a member of a minority group in those 101 counties.
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  So it's all in the eye of the beholder. It depends on whether you look at the glass as half empty or half full. Either you could say that two-thirds of the counties for those counties with the highest numbers of minority farmers had no minority member on the county committee or you could look at it as just the opposite and say one-third did and that roughly one-fifth of the total membership was made up of minorities.
  It just depends on how you interpret those facts. Our job was to bring you the facts.
  Mrs. CLAYTON. We may have a chance to revisit. I'm out of time.
  Mr. GOODLATTE. Thank you.
  Mr. ROBINSON. Mrs. Clayton, there's an extraordinary amount of numbers that we can get into. I hate to make this thing a boggle of numbers, but we focused developing the numbers.
  Mr. GOODLATTE. Thank you.
  The gentleman from Florida, Mr. Foley.
  Mr. FOLEY. Thank you very much.
  I have been reading the report. It raises a few questions. And certainly some of the statistical data will bear out that maybe there wasn't discrimination. But oftentimes what I find in our country is it's underlying. You may not be able to prove it through statistics and through checking the application, but oftentimes we don't go out of our way to help minorities as we may help a white person who comes up, ''Here. Let me help you fill out the form. Let me get the paperwork straight for you. Let me show you how to get the answers to this question.'' So from the get-go, you're disadvantaged.
  You may not be able to prove it by the map, but when a black goes to a restaurant, they're sometimes not seated, ''We're full'' or ''We're busy.'' Hispanics the same way, women attempting to do things within an agricultural environment, ''No. You're a woman. You probably can't handle the plow'' or whatever. You know, there's always a reason why somebody can't qualify.
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  So I'm not blaming the GAO. But I would suggest, though, under all of it there is discrimination in this country. And we've got to accept it and agree it's there.
  And while the information suggests it's getting better, we're still a long way from home. We're a long way from equality in this country.
  I was reading here, ''Following this technical evaluation, if sufficient funds were available, the county committees approved all projects.'' But in what order? And did we determine—and that's a question. How were they awarded? Were the certain privileged awarded first and then when we got to the end said, ''Sorry. We don't have any money for you?''
  That's a concern I have because they may have met all the criteria and you felt good about yourself because you helped a minority at least qualify, but you gave the money out to the folks that you wanted to and preferenced them and the minority farmer was told, ''Sorry. We're out of money. You would have made it. Next time sign up.'' And by that time, they're out of business, and they've struggled to survive.
  So that's a question. Did we check to see once it was evaluated, the distribution of the dollars? Did they flow in the way the applications were received or were they given in a different direction?
  Mr. ROBINSON. Fred can elaborate since he was actually in the offices, but it's my understanding that we did check on a chronological basis. But before we get to the detail, can I just comment just a little bit on the overall premise?
  We would be crazy to sit here and say that there wasn't discriminatory behavior in a structure as far-flung as the FSA county office structure. I am in no way suggesting that, and I don't think the report in any way tried to even comment on that. As a matter of fact, I think we're going out of our way to say we tried to live with just what the data showed and what the evidence showed.
  We did not attempt to find out how people were treated. I hope you can understand how difficult that would be to audit, because there are no records kept of that.
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  So I just want to have that premise. And now let me turn to Fred for the specific answer to your question.
  Mr. LIGHT. Yes. What you're referring to is the ACP program. Essentially the county committees do have a wide amount of discretion as to how they appropriate that money after the applicants submit it to the technical review.
  And we specifically looked at that in each of the five county offices that we went to, what criteria they used to apply the funds. And essentially what we found is that each of the five county offices provided money to both minorities and non-minorities according to their criteria, which in some instances provided funds to minority farmers and in other instances provided funds to non-minority farmers. But we didn't find anything unfair in that treatment.
  As an example, in one county, there were about eight applications for SL–6, which is essentially building a pond on a farm. There were six minority applications for that project and two non-minority applications. All of those applications were denied because of lack of funds or because of a lack of a priority in this instance.
  That's what we found essentially throughout the five counties that we went to, is whatever the criteria was, it was equitably distributed between the minority and non-minority farmers.
  Mr. FOLEY. Well, again, I'm not trying to criticize your agency. I'm a big fan of your agency. You do a wonderful job under limited resources.
  But what I think—and I want to commend the chairman for holding the hearings because I think it's important to just talk about it. And there are going to be times when we are going to have to take a breath and help people process their applications that may not have the technical skills themselves but they're hard-working people.
  I mean, I see a lot of loans turned down in the real estate business because, well, they didn't have a high school education. They don't have this, they don't have that. But these people will pay back their loans because they work very, very hard. They work 15 hours a day to feed their families.
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  So I think in every case that we can talk about this and realize and make ourselves sensitive to it—it's not just this agency. I mean, it's car dealers. You know, you walk in. If you're a black American, you've got to hope and struggle a little bit harder to get what you want. That's a sad commentary on our society.
  But, again, by just having the discussion, by sharing this information, by realizing it exists and realizing we're going to be looking even more carefully at every agency, then I think we can help heal America a little bit.
  Thank you, Mr. Chairman.
  Mr. GOODLATTE. I thank the gentleman.
  The gentleman from Mississippi, Mr. Thompson.
  Mr. THOMPSON. Thank you, Mr. Chairman.
  For the record, Mr. Robinson, how do you define minority?
  Mr. ROBINSON. We defined it the way USDA defined it. We had four groups: African American, Hispanic American, Asian American, Native American.
  Mr. THOMPSON. Are you aware that USDA is 52d out of 56 Government agencies as it relates to hiring minorities?
  Mr. ROBINSON. I can't comment. I have no information on that.
  Mr. THOMPSON. Well, it's documented. And I want to share that with you.
  What is the percent of minority employees within FSA?
  Mr. ROBINSON. I think it's less than 1 percent.
  Mr. THOMPSON. Less than 1 percent?
  Mr. ROBINSON. Correct.
  Mr. THOMPSON. Well, and what I'm trying to get at is your study.
  Mr. ROBINSON. That was for the county committees; correct?
  Mr. LIGHT. No.
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  Mr. ROBINSON. For all total?
  Mr. LIGHT. For the county employees.
  Mr. ROBINSON. The county employees.
  Mr. THOMPSON. Less than 1 percent?
  Mr. ROBINSON. Right.
  Mr. THOMPSON. But the study you shared with us today gives a different picture. And what I'm concerned about is that less than 1 percent is intolerable. But nowhere in your report do you even acknowledge that percentage. So a layman reading your report would assume because of it not being corrected that, in fact, FSA is a model agency. So I'm glad you answered that.
  Mr. ROBINSON. Mr. Thompson, I don't know how you could conclude that we're saying that FSA is a model agency. We certainly don't believe that.
  Mr. THOMPSON. Well, maybe my reading is wrong.
  Next thing. Is it your understanding that the county committees do not hire the county FSA directors?
  Mr. ROBINSON. No. They do.
  Mr. THOMPSON. Well, we just had earlier testimony. Nobody even alluded to the hiring of the staff.
  Mr. ROBINSON. I'm not following your question. I'm sorry, sir.
  Mr. THOMPSON. My colleague Mr. Bishop talked about the county committees and——
  Mr. ROBINSON. Elected county committees. Yes, sir.
  Mr. THOMPSON. And we talked about the roles of them. And nobody talked about that this committee actually hires the staff at the county level.
  Mr. ROBINSON. Well, I'm sorry. When I was answering the question, I thought we were asking what role does the county committee have in making loan decisions. We were focused on that angle, aspect of his question. I mean, county committees do a host of things.
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  Mr. THOMPSON. So you don't see a conflict between hiring the staff and approving loans?
  Mr. ROBINSON. I don't necessarily see a conflict there. No, sir.
  Mr. LIGHT. If I can, the staff that approves the loan are Federal employees and have come over from FmHA. The county committee hires the old ASCS executive director. And they hired the staff for those FSA operations such as ACP.
  But the direct loan staff is essentially all Federal employees. And we're not hired by that county executive director.
  Mr. THOMPSON. Well, not really. Now, are you aware that FSA employees are not really Federal employees?
  Mr. LIGHT. Yes.
  Mr. THOMPSON. You are?
  Mr. ROBINSON. There are some FSA county employees. And some of these FSA employees are Federal employees. Correct, sir.
  Mr. THOMPSON. Well, your report does not make the distinction. Your report says that all FSA employees are Federal employees.
  Mr. ROBINSON. Oh, no. I don't believe that's accurate.
  Mr. THOMPSON. Yes. It's in your report. Your testimony here says it, page 3 on the background, where it says, ''These FSA officials are Federal employees.''
  Mr. ROBINSON. Relative to the loans, that's correct. They make the final decisions.
  Mr. THOMPSON. All right. Now, who employs those individuals?
  Mr. ROBINSON. The Secretary, I presume.
  Mr. THOMPSON. Well, explain to me.
  Mr. LIGHT. The employees who determine whether or not you're eligible for a loan or not are Federal employees. They were part of the old Farmers Home Administration.
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  When ASCS and Farmers Home combined into FSA, those Federal employees that were dealing with farm loans, farm ownership loans, came over under FSA. They're still Federal employees.
  The old ASCS employees are non-Federal employees. And they are hired, the CED is hired, by the county committee, who then hires the staff in those offices.
  Mr. THOMPSON. So those Federal employees if a vacancy were to occur would hire Federal employees?
  Mr. LIGHT. I don't think USDA has hired any employees in the last couple of years, but if a vacancy occurred in the agricultural credit side, on the loan side, I presume they would be replaced by a Federal employee.
  Mr. THOMPSON. So if that employee were dismissed in that office, would that non-Federal employee be responsible for that dismissal?
  Mr. LIGHT. I don't know who would be responsible for a dismissal of a Federal—I presume that the Federal/State employees would dismiss that employee.
  Mr. ROBINSON. To a degree, Mr. Thompson, what we did is what we did. We didn't get into a lot of these other issues. Hopefully our statement was pretty clear about the scope of our work and what we intended to talk about and what we didn't.
  Mr. THOMPSON. My point is your scope is so narrow that you really can't get the full breadth of the issue that small farmers are facing with such a narrow scope. And I think that's my concern.
  Mr. ROBINSON. Obviously I think the national data and the local data we brought to the table and the file reviews add quite a bit to the scope of knowledge on this subject.
  But you're certainly correct. And, as I discussed right at the start, it does not get into how people are treated when they walk in the door. It doesn't get into the personal biases of individuals. It only gets into what was in those files that we could review. And that I will certainly concede.
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  Mr. GOODLATTE. I thank the gentleman.
  The gentleman from Michigan, Mr. Smith.
  Mr. SMITH. Thank you, Mr. Chairman.
  Help me understand. When did this study/investigation occur under the old system or under the new system?
  Mr. LIGHT. Essentially under the new system when Farmers Home and ASCS were combined. We started with data from fiscal year 1995 forward. So essentially it's under the new system.
  Mr. SMITH. The old system in Farmers Home Administration had a county Farmers Home Administration advisory board. That no longer exists; right? Now it's the ASCS committee is the sole committee that supervises the work in the consolidated Farm Service Agency offices?
  Mr. LIGHT. That's correct.
  Mr. ROBINSON. There is an FSA county committee.
  Mr. SMITH. There's no C in front of the F?
  Mr. LIGHT. No.
  Mr. SMITH. I thought there was in the law. We so-called it Consolidated Farm Service Agency.
  Mr. ROBINSON. No. That was one reorganization previous to this reorganization.
  Mr. SMITH. Thanks. So I don't understand. We just started the new FSA when? Last spring a year ago. But your studies must be before that, as I read it.
  How accurate is your study based on the realignment of the consolidation that's taken place in the last year?
  Mr. ROBINSON. Reasonably. Obviously it spans from October 1, 1994 to March 31, 1996. A variety of activities were happening during the reorganization process.
  Mr. SMITH. Am I correct there no longer is a separate advisory committee for the loans, for farm loans, in the FCS, FSA offices?
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  Mr. ROBINSON. That's correct.
  Mr. SMITH. It used to be the Farmers Home Administration had their separate advisory committee. My impression is that's who you studied because they didn't exist until a year ago, less than a year ago.
  Mr. LIGHT. We studied the actual loans that were applied for during that time period. In most of that time period, the old Farmers Home County Committee did not exist at that time.
  Mr. SMITH. Is that right? We just did away with the Farmers Home Administration Advisory Committee last spring; right?
  Mr. ROBINSON. Spring of 1996?
  Mr. SMITH. Yes. In the spring of 1996 is when we phased in and implemented the consolidation?
  Mr. ROBINSON. See, our difficulty here is that we're spanning multiple periods. And I'm not exactly sure.
  Mr. SMITH. Well, that's why I'm trying to——
  Mr. ROBINSON. That's what I'm not exactly——
  Mr. SMITH. I'm trying to see how accurate this study is in light of the new system that we're now working under.
  Did you examine Farmers Home Administration and minority bias in the Farmers Home Administration with rural housing loans?
  Mr. ROBINSON. No, sir.
  Mr. SMITH. So you didn't consider rural housing loans within USDA?
  Mr. ROBINSON. Direct farm loans.
  Mr. SMITH. And so all you considered is direct farm loans?
  Mr. LIGHT. Correct.
  Mr. ROBINSON. And ACP. We looked at minority employment and minority representation on county committees in 101 counties and the organizational efforts that FSA was undertaking to ensure in a global sense that their staff was——
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  Mr. SMITH. When did you complete this study and start writing your report?
  Mr. ROBINSON. The report was issued in January 1997. So we would have finished writing in late 1996 but governing a period of time in fiscal year 1995 and 1996 data that we would have been using.
  Mr. SMITH. And so are you saying that your report is accurate, regardless of the fact that there was a consolidation of efforts and it all moved into FCS? So you studied the old Farmers Home Administration actions, the loans that were initiated that started taking place, the turndowns that occurred, et cetera, under the Farmers Home Administration system? And then you followed those through as the Farm Service Agency took over the operation technically under the FSA?
  Mr. ROBINSON. What I'm saying is our report is entirely accurate for the period of time we examined. What seems to be confused here is what set of rules was in place and what set of players would have been in place during that period.
  It's my understanding—and, Fred, you can correct me here—that the situation was in somewhat of a flux as to who exactly all the players were and when they actually worked for——
  Mr. SMITH. So when did the ASCS and Farmers Home Administration cease to exist and the new Farm Service Agency take over the operations of the Farmers Home Administration?
  Mr. ROBINSON. It was all directed by the Crop Insurance Reform and Reorganization Act of 1994.
  Mr. SMITH. No. When? You must know when. I mean, part of the time you were studying the action of the Farmers Home Administration Advisory Board made up of local farmers. And they ceased to exist about, if I'm not mistaken, 10 months ago. And the Farm Service Agency Board, which was the old ASCS County Committee, replaced them as far as any advisory capacity to decide on loans as it went to the district office. Is that right?
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  Mr. ROBINSON. What I'm saying is that formerly Farmers Home employees made final loan decisions. And now FSA employees are making final loan decisions.
  Mr. SMITH. But the advisory committee advised on those loans. I mean, the Farmers Home Administration Farmer Advisory Committee advised on those loans. And I assume that the Farm Service Agency is taking over that responsibility.
  Mr. ROBINSON. That is correct.
  Mr. SMITH. And so part of the time for what's part of your study was encompassed the last 11 months. It was a new advisory farmer committee, rather than the old Farmers Home Advisory Committee, that was making the recommendations.
  Mr. ROBINSON. That's correct. And what's difficult here is I'm not sure at what point what application would have been submitted and how many of the applications that we looked at would have been looked at in one way versus another way. All I can tell you is that, no matter who was involved with it, the ones that we looked at in detail, the decisions of approval or disapproval seemed to have a rational, justified basis.
  Mr. SMITH. But what is the decision? Was it based on the request that you didn't look at rural housing loans?
  Mr. ROBINSON. Our scope was worked out that we would look at direct loans and ACP grants.
  Mr. SMITH. And how was that scope decided?
  Mr. ROBINSON. In response to the written request we negotiated with the key staff of the committee.
  Mr. SMITH. Thank you, Mr. Chairman.
  Mr. GOODLATTE. Thank you.
  The gentleman from Georgia, Mr. Bishop.
  Mr. BISHOP. Thank you very much.
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  I'm always intrigued by the GAO reports. I come from peanut country. And we had a lot of fun with one having to do with the peanut program a couple of years ago.
  Mr. ROBINSON. I was here in this chair.
  Mr. BISHOP. We were interested in determining the basic assumptions and the methodology and the underlying limitations that you start off with because when you set your parameters of what your limitations are going to be and what the basic assumptions are, that pretty much determines to a large extent what the outcome can be. Isn't that true?
  Mr. ROBINSON. I disagree with the implication. I mean, when you look at national data on the number of farmers approved or disapproved for ACP and direct loans, I'm not sure what assumptions are associated with that. That is, the facts are what they are.
  So I will readily concede that looking at five offices or five district loan offices and five county offices is not a large number out of the several thousand that are out there. I will certainly readily concede that. But I hope the committee will understand how resource-intensive that is and the limitations.
  I think what's key to us and what the audit standards require is that we very carefully and very clearly lay out the limitations and put those in front of you. And I think we have in this case.
  Mr. BISHOP. Basically the bottom line is you saw a higher disapproval rate in the counties that you looked at. Using the methodology that you selected, it resulted in finding a higher disapproval rate among minorities than among non-minorities. Is that correct?
  Mr. ROBINSON. That is correct not only in the places we looked but, nationwide.
  Mr. BISHOP. Correct. You chose to look at five of the counties with the 100 highest minority populations?
  Mr. ROBINSON. For employment and county committee member purposes. The five county offices and the five district loan offices that we looked at for application disposition process were not in the——
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  Mr. BISHOP. What were those five based on?
  Mr. ROBINSON. Two factors: No. 1, that when we looked at the evidence, it showed that three of them in each case, in each category, had a pretty high statistical disparity between the approval/disapproval rates for minorities versus non-minorities, so we wanted to get behind that, ''What's the story? What evidence is there behind that?'' Or, alternatively, we went to two other locations that had high numbers of minority farmers. So that's how we filled out five.
  Mr. BISHOP. Minority farmers high and disapproval rates were the two?
  Mr. ROBINSON. Those were the two factors, not applied both at the same time, if you will.
  Mr. BISHOP. What I found interesting was in looking at the five counties, Russell County, AL, with which I'm very familiar having lived in Columbus, GA for 24 years, and Dooly County, GA, which was a part of my Congressional district for the first 4 years I've been here, Holmes, MS, Glacier, MT, and Duval, TX, none of those counties had any minority committee members with the exception of Duval, TX, which had two. I assume that those were either Mexican American or Native American.
  Mr. ROBINSON. They are Hispanic in that county. Yes, sir.
  Mr. BISHOP. If those small numbers with higher participation would indicate a disparity where you have even fewer minority farmers where the percentage is lower, wouldn't you have to assume that based on trends and history that this disparity rate in denials would be even higher?
  Mr. ROBINSON. Again, we have the national data that we can look at. Nationally for loans 84 percent of minority loans get approved. Ninety percent of non-minority loans get approved.
  Within that, by the way, within that minority number, it varies. I think for African Americans, it is 80 percent. And correct me if I'm wrong here. I think it goes up as high as 91 for Asian Americans.
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  Mr. BISHOP. Let me go back to the limitation. In order to apply for the loan and to be considered by the FSA committee, the county committee had to determine that the individual was a farmer; and that the individual had good experience; and, finally, that the individual was creditworthy. Is that correct?
  Mr. ROBINSON. That's correct.
  Mr. BISHOP. So that means what constitutes managerial experience is in the subjective determination of whoever constitutes that county committee. Is that correct?
  Mr. ROBINSON. There are some fairly clear criteria, but yes, ultimately you're right.
  Mr. BISHOP. And that documentation can easily be placed in the file that this particular individual does not meet the managerial experience level.
  Mr. ROBINSON. Mr. Bishop, you're exactly right. If there was some conspiracy at work to fake the files or to put things in there that didn't belong in there or to create documents out of thin air, there's no way we would know that.
  Mr. BISHOP. I'm not even going there. And I know my red light is on. But what I'm suggesting is that even knowing that those files would be audited periodically, that FSA is going to be audited and the files and the recommendations by the county committees will be audited, they have to have certain documentation in order to pass the audit. Is that not correct?
  Mr. ROBINSON. One would hope that the existing documentation——
  Mr. BISHOP. When a loan is turned down, that documentation has to be there. And everybody on the committee knows it, and everybody at FSA knows it. Is that correct?
  Mr. ROBINSON. They should know that. I'm sure it's subject to audit.
  Mr. BISHOP. So if you look only to the extent of documentation in the file and the people who prepare that file know that that documentation is going to be sought after to justify whatever decision is made, then your study and your results are limited to that extent, are they not?
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  Mr. ROBINSON. Our study, as I have said multiple times and will say again, is limited by the evidence that was in the files and the records. We did not seek other sources of data.
  Mr. BISHOP. If the chairman would allow me one final statement in this round? And that is that historically I have heard from minority farmers who have complained that year after year studies were done to determine discrimination in USDA. And they have made the assertion, the allegation, I might say, that when the studies were commissioned, they were not intended to ascertain the facts and to determine if there, in fact, was discrimination and that they knew that from the start because of limitations that were placed on the study.
  Mr. ROBINSON. Can I respond to that?
  Mr. GOODLATTE. Yes, you may.
  Mr. ROBINSON. I strongly disagree with any implication that the staff or the members of the House Agriculture Committee gave us a mandate to come up with a clean bill of health for this or to mandate a certain set of findings. That is in no way the case.
  Mr. BISHOP. That is not what I suggested.
  Mr. BISHOP. And I didn't suggest that it came from the House Agriculture Committee, nor did I suggest any origin.
  Mr. ROBINSON. The scope of this report was prepared in consultation with the House Agriculture Committee with the goal of——
  Mr. BISHOP. I'm just lifting up the allegations that I have heard from minority farmers that whenever a study has been done, it has been set up and constituted in a way that it would not get at the facts.
  Mr. ROBINSON. And I guess what I am saying—and I'll drop it after this—is that that may be the truth in the past, but I would look you square in the eye and say that is absolutely not the case here.
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  Mr. BISHOP. But you admit that your limitation and your conclusions can go no further than the data that was contained in the files that you examined.
  Mr. ROBINSON. Supplemented by the national data that we developed. Yes, sir.
  Mr. BISHOP. But no indication of what the intentions were of the people who put that data together who put it in the files? There was no consultation with them as to the background?
  Mr. ROBINSON. Absolutely correct, sir.
  Mr. BISHOP. So all you have is strictly paper. Is that correct?
  Mr. ROBINSON. Another way of saying that is all we have is evidence. I mean, I don't know what that——
  Mr. BISHOP. All you have is statistical evidence that has no editorial or no elucidatory information to go with it, enlightening information, nothing to put it in the context.
  Mr. ROBINSON. We do not have the——
  Mr. BISHOP. You don't have the context. You have no information, no anecdotal, no narratives of the contextual basis on which that statistical data was——
  Mr. ROBINSON. Other than we also bring our own brains to the table. When we were looking at the files, we saw the same standards were applied to one set of people as were applied to the other as shown in the files. I mean, I don't think we were automated— just blindly looking for existences of pieces of paper.
  Also, if someone said there was a poor credit history, that ''We're turning this individual down because of a poor credit history,'' we made sure or we looked to see if there was evidence to demonstrate a poor credit history. And that we did, sir, I promise you.
  Mr. BISHOP. Well, I don't question your motives at all. I'm just wanting to point out here that there is a limit on the conclusions that can be drawn from the evidence that you based your conclusions on simply because of the methodology and the limitations of your inquiry.
  Mr. ROBINSON. As with any study. I agree, sir.
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  Mr. GOODLATTE. The time of the gentleman has expired.
  Mr. ROBINSON. For the record, we didn't make any conclusions, by the way.
  Mr. GOODLATTE. The Chair would not that there is a vote on the floor. There are about 12 minutes remaining in the vote.
  The Chair would inquire of the gentleman from Texas if he has questions of this witness?
  Mr. STENHOLM. I can ask my questions after or submit them in writing.
  Mr. GOODLATTE. The Chair recognizes the gentleman from Texas.
  Mr. STENHOLM. We will hear later today of a D.J. Miller study that was paid for by the Department of Agriculture. Can you tell us a little about the genesis of this study and why it did or did not prove useful to your investigators in their attempts to examine discrimination in USDA?
  Mr. ROBINSON. I guess the simple way to answer that is that the D.J. Miller study was initiated and was ongoing in the midst of all our work. The D.J. Miller study, as I'm given to understand it, was focused on farmer participation and the old disaster payments, CCC loans, deficiency payments, those kinds of issues. That was their focus. They did not focus on direct farm loans, ACP, which is what we focused on, kind of filling in the gaps.
  Mr. LIGHT. And specifically the decisions that are made at the county level. And we wanted to focus our efforts here as to the decisions that the county committee or the county employees would be making out in the field, rather than national decisions made here in Washington.
  Mr. ROBINSON. So the answer, the simple answer, is that they looked at one thing and we looked at something else.
  Mr. STENHOLM. What did they look at?
  Mr. ROBINSON. A variety of things. I mean, it's——
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  Mr. STENHOLM. And what did you look at?
  Mr. ROBINSON. We looked at three things: No. 1, the overall efforts of FSA to achieve fair treatment; No. 2, minority representation on county staffs and county committees; and No. 3, the approval/disapproval actions relative to ACP and direct farm loans.
  They were looking at farmer participation in deficiency payments, disaster payments, CCC Farm Program loans. They didn't look at the same thing that we looked at.
  Mr. STENHOLM. Were the findings similar or did you find something different than they did?
  Mr. ROBINSON. Our findings are very much factual. We did not reach conclusions. We wanted to bring this committee as many facts as we could provide. And that's what we did.
  I think the D.J. Miller study has been—well, maybe I'm overstepping here, but roundly criticized for certain methodological weaknesses and so on and so forth. And I'm not sure to what use that study was ever put, frankly.
  Mr. GOODLATTE. I thank the gentleman. And I thank Mr. Robinson and Mr. Light for their contribution today. And if there are no further questions of these witnesses, they are excused.
  Mr. GOODLATTE. The subcommittee will stand in recess until immediately after the vote.
  Mr. GOODLATTE. The subcommittee will come back to order. At this time we would like to invite our second panel up to the table. They include: Mr. David Harris, executive director of the Land Loss Prevention Project; Mr. Walter Powell, president of the National Black Farmers Association; Mrs. Jennifer Felzien, president, Women Involved in Farm Economics, W.I.F.E.; Mr. Alvin Windy Boy, Sr., secretary of the Intertribal Agriculture Council; Mr. Pheng Vue, president of the California Highlander Cooperative, Inc., accompanied by Dr. Charlie Chang, the interim executive director of the Hmong National Development, Inc.
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  We also are joined by Mr. John Boyd with the National Black Farmers Association.
  All of your written statements will be made a part of the record. And we would be pleased to receive your testimony at this point. Mr. Harris, you may proceed first.
  I want to warn everybody that we have two more votes coming up on the floor of the House of Representatives. And they're going to be at fairly rapid intervals. So we will have to recess periodically, but we'll keep coming back until we get everything we need to on the record.
  Mr. Harris, welcome.
  Mr. HARRIS. Thank you, Mr. Chairman.
  Mr. HARRIS. Mr. Chairman and to the ranking member, good afternoon. Thank you for the opportunity to appear before the subcommittee and share additional information with respect to the decline in the numbers of minority farmers across this country and the role that USDA has contributed with respect to that decline.
  With respect to the written statement, Mr. Chairman, I should note that you should have substituted the final written version, which has a letterhead to it, as opposed to the fax that you probably got earlier, which was a product of short notice.
  I might also add, Mr. Chairman, that not attached to my report but I believe in your package—and I would ask that this be added to the record as well—is a letter from the Rural Coalition addressed to yourself and to Congresswoman Clayton, which gives a very thorough analysis of the issues and the problems with respect to the GAO report.
  For the past 15 years, the Land Loss Prevention Project has provided free legal representation to financially distressed family farmers. Half of our clients are minorities. Most of those minority farmers that we work with have been the victims of discrimination by one or more agencies of the U.S. Department of Agriculture, most of the time what used to be known as the Farmers Home Administration.
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  Myself being an attorney who has looked at documents, attended meetings, attended hearings with my clients, worked with clients personally, I can tell you from personal experience up close and personal that the problem that this committee is here to address is a very real problem.
  The problem has been here for a very long time. The numbers that you have all heard time and time again do not lie. And while some of the past analysis has stated that economics is a factor, is the sole factor, while it may be true that economics is a factor, when you add in blatant discrimination and neglect along with those economic factors, such as size of the operations, then what you have is an equation for disaster, an accelerated rate of decline, and the very extinction of minority farmers themselves.
   On pages 2 and 3 of my written statement is a short list of a number of reports that have been issued. And one, of course, is a 1990 report. That report came from a hearing, which I personally testified at that time.
  The reports all say the same thing. And I share the sentiment stated by Congressman Hilliard earlier that it is long about time that strong effective action be taken that the problem of institutional bias in a hostile environment must be addressed and must be addressed fast.
  A lot of the discussion today has related to the county committee. It is true that a county committee has been adjusted somewhat from the old Farmers Home model to what was once known as the ASCS model, but the problems are still there.
  The county committee structure, where you have a close working relationship, a buddy relationship, if you will, between the county executive or county supervisor and the members of the county committee creates an atmosphere. It creates an old boy network, if you will, whereby nepotism is the rule of the day and discrimination is also the rule of the day.
  I point the committee to a study done by what was then known as the Office of Equal Opportunity of Verte County in which the investigators found that the African American farmers were not told of the limited resource lending programs and other special services available. Yet, limited resource loan funds were given to a relative of a very wealthy farmer in that community.
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  Time and time again we have seen instances where the money, if you will, has gone to those who are either on the committee or had a good relationship with those who are on the county committee and has not gone to those for which the Congress intended for those funds to go or for those services to go.
  And with respect to the GAO report, the GAO report does not even begin to talk about problems such as people being discouraged from applying in the first place and also the fact that—and other practices that happened that are not documented on an ongoing basis.
  With respect to these many problems—and a lot is mentioned in the written report, Mr. Chairman—I would note one of two things as possible solutions. There must be strict accountability. The county committee structure must be reexamined and reexamined fast. The old boy network as it currently exists in all of these counties must be broken up.
  And there must be strict accountability all the way up the line. And if the Secretary wants the ability to hire and fire, for example, local employees, then what must also come with it, accountability held on the Department itself, as a member of that Department, employee of that Department accountable for what they do and do not do.
  With respect to data collection, you will note that one of the reports refers to litigation against the Farmers Home Administration. I was one of those attorneys who filed that litigation back in the early nineties. When we were finally able to collect those documents, we found a lot of discrimination. But we also found poor data collection.
  One of the solutions, frankly, relates to new requirements with respect to collecting data on all programs, something very similar to the Home Mortgage Disclosure Act, if you will.
  I will end my remarks at that point.
  [The prepared statement of Mr. Harris appears at the conclusion of the hearing.]
  Mr. GOODLATTE. Mr. Harris, thank you very much.
  We do have a vote on the floor, as I indicated. So we will stop here. And we'll take up with Mr. Powell as soon as we get back.
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  We'll look forward to seeing you all in just a few minutes.
  Mr. GOODLATTE. The subcommittee will come back to order. And at this time we will welcome and recognize Mr. Powell. Your full statement will be submitted for the record. And you have 5 minutes to summarize your remarks. We're glad to have you with us today.
  Mr. POWELL. Thank you for having me here.

  Mr. POWELL. I'm Walter Powell, a northeast Louisiana farmer. And in the mid-seventies, after I got out of high school, I tried to borrow money, but I couldn't borrow money. So I borrowed money around the eighties from FmHA, Farmers Home Administration. And through this, I've had some good years and bad years with my farm operation.
  In 1986, I talked to a gentleman at Farmers Home and asked to borrow money to better myself and lease more land that's more profitable. He told me that FmHA would back me in that and that I needed to go and get the lease, which was more or less commit myself to leasing someone's property before it really can be determined whether I will get a loan or not, which is the way that they still do things right now. And I don't feel that it's right.
  But, nevertheless, I then was unable to obtain that loan. So at that time I already owed the FmHA some money. And I had to go somewhere else to borrow some money. So the person that I borrowed money from was the one that I mortgaged my crop with.
  But I still left a debt owing at FmHA. So after about 4 1/2\ years, I got a call from Mr. Thurman saying that I still owed the Government money. And I told him that I was aware of that.
  He said that I had to take the proceeds that I made from that crop and give it to him to pay on the debts. And I told him I couldn't do that because the guy that I borrowed the money from I owed it to him.
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  So he then said that if I didn't pay him that money, pay the Government that money, the way he put it, that he would start foreclose and administrative offsets and Government payment garnishing wages and everything else he could do to see that the note be satisfied.
  Well, at that time it come out with something that was called a debt settlement. And it was something that the Government knew things they come out with I knew very little about, that you could redo your debts and they could write them off or whatever. Yeah. That's the way they were doing that. They were writing off the debts.
  So I filed. On May 3, 1990, I filed a debt settlement application. It took Mr. Thurman so long to get back in touch with me on the status of that debt settlement that when I did go back in, he told me that he didn't have it. He had lost it.
  I then turned around and filed another debt settlement application. The application was accepted and approved.
  And I thought that was going to be the end of it, but later on my father passed away. And he had found out that my father had passed away. And he wanted to say that I was going to inherit property and land, well, value, and that he wanted me to either mortgage it or to sell it, and bring him the money. And I couldn't do that either because my mother was still living, and she inherited my father's property.
  So Mr. Thurman, in turn, after this application had been accepted, he then calls me in and says that he had made some like scratches or whatever, that he didn't want to turn it in with scratches and pencil eraser marks on it and asked me to sign a blank application. I'm acting in good faith, and I signed the blank application.
  He then turns around and fills out the application and adds a significant amount of money to this application, which caused me to be rejected after he turned—what he did is he took the application that had been approved and set it to the side and filled out an application as to one that he wanted to turn in and called a special meeting with the county committee, had them to come in. And they rejected it. Well, quite naturally, they rejected it.
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  I asked him for a copy of that application. He would not give me a copy of that application. Several times I asked him. He wouldn't give it to me. But one day that I went by there, he was gone to lunch. I asked for my file. They gave me my file. I went through it and got out the necessary information that I needed. And that's when I filed the suit against Farmers Home.
  Now, up on 1994, I did receive a farm loan from Farmers Home. I was unable to pay all of it back. So what I did in 1995, I put in another application to borrow money for a farm loan. By being so late, I was told that they had run out of money for that particular year. So I didn't say anything about that because I felt like basically that may have been some of my fault, too.
  So in October 1995 I submitted an application for a farm loan for the 1996 crop year. From October 1995 until April 24, 1996, that was when I finally got the answer to my question as to the status of my application. Every time I would call somebody and say it's at Mr. so-and-so's desk or he's not there, or we sent it over there. They would also wishy-washy me and paper shuffle me around until after the President signed the 1996 farm bill. That's when I got an answer as to what they were going to do.
  Now, I guess my time is up, but it's in my report. And I wish that you all would take time and read my report. And if you have any questions, please feel free to call me.
  [A copy of Mr. Powell's report is on file with the committee.]
  Mr. GOODLATTE. Thank you, Mr. Powell. We will definitely read your report and followup on it. And we will have some questions for you at the conclusion of the testimony of the other witnesses. Thank you very much.
  At this time I would like to recognize Mr. Boyd.
  Mr. BOYD. Thank you, Congressman Goodlatte, Congresswoman Clayton.
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  I appreciate this time this afternoon to tell how I really feel about the Department of Agriculture. I have worked very diligently this past year to bring racism and discrimination, unfair lending practices, racial bias, neglect to an end at the Department of Agriculture.
  Today less than 1 percent of the Nation's farmers are black. Sixty-seven percent of that 1 percent are program participants at the Department of Agriculture.
  If this trend is not turned around there will be no black farmers by the year 2000. So we need your sincere help to address this matter immediately.
  Right now there are some 1,500 complaints at the Department of Agriculture. They're only acknowledging 271 complaints. What's going to happen to all of these other farmers that they're not acknowledging their complaints? They're sending them letters.
  I have a copy of a letter that they sent a farmer. The man is on his death bed. He filed a complaint back in 1992. They sent him a letter last week that read ''If you don't respond in 20 days.'' His file is now dead. He's already filed a complaint. Why can't they address this one? These are the problems that are still going on.
  There are foreclosures that are continuously going on. Right now, Congresswoman Clayton, since Secretary Glickman put a moratorium on foreclosures, there has been 22 foreclosures the State of North Carolina, and 12 in the State of Virginia. Why are these foreclosures continuously happening where there's supposed to be a moratorium? These are the questions that I have today.
  Today I have a copy of the list that the Department of Agriculture is claiming they're active complaints. I'd like you all to take a look at that and check into what's going to happen to all the other hundreds of farmers.
  Today I have a copy of the foreclosure list that took place after December 14. I'd like for you all to take a look at that also.
  Secretary Glickman said he didn't know how much money they had available to pay these settlements. I have a letter here from Senator Charles Robb which indicated that last year you all appropriated $11.774 million to start settling these complaints. Where has that money gone? How is it being used? And who was paid? I would also like it if you all could check into that for me.
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  Also, I have another letter here from the Governor of Virginia, who called this a ''sickening realization and a national disgrace.'' I tend to agree with that statement.
  In 1940 there was 1 million black farmers. Today there's less than 18,000. This is a dying species. And, again, we need your sincere help and dedication to turn this trend around. Right now we do have a fair chance.
  If the Department of Agriculture does not start letting us participate in those programs in a fair and equal basis, by the year 2000 we will be gone.
  I have worked a plan with First Union Bank to lend minorities and black farmers in the States of Virginia and North Carolina $5 million. And all they needed was someone from within USDA to work with them. We haven't been able to get anybody to work with us.
  They said down in Mecklenburg County, Brunswick County, Lewisburg County that they were out of funds. I checked within the Department of Agriculture. They have funds for those counties.
  Why are these black farmers not able to get these loans like any other American in this country? These are things that need to be answered immediately. Planting season is right around the corner. We have no operating money.
  But the Secretary gave us a nice fancy document with 92 recommendations. Will this document gain dust like the rest of them or will there be implementation this time? These are things that need to happen for us.
  There have been no settlements on the backlog of complaints. Why issue a fancy document saying that, ''Mr. Boyd, you've been discriminated against in 4 different years. Even though your loans were approved, we still didn't fund them; that your loans, Mr. Boyd, took 2 years on average to process, but we still didn't fund them?''
  The Office of General Counsel, Kent Cohen, indicated that there's 100 lawyers at USDA. I said, ''Mr. Cohen, why don't you all have any minorities or black lawyers there?''
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  ''Because we don't need any.'' This is the systemic nature at the Department of Agriculture. That needs to come to an end there. And we need your help to get it done.
  Thank you.
  Mr. GOODLATTE. Thank you, Mr. Boyd.
  We will again recess for a vote. This time when we come back, we hope we're going to have at least an hour before the next vote. So we'll hopefully get much further along. When we come back, we'll take up with Mrs. Felzien.
  Mr. GOODLATTE. Mrs. Felzien, you have been exceedingly patient, as have the rest of the panelists. And at this time we welcome your remarks. Your full statement will be made a part of the record. And you have 5 minutes to summarize your remarks.
  Ms. FELZIEN. Mr. Chairman and members of the committee, I am Jennifer Felzien from Sterling, CO. And I serve as national president of Women Involved in Farm Economics. Thank you for the opportunity to speak to you today.
  As far back as 1987, W.I.F.E. expressed our concerns regarding discrimination in the USDA; thus, our lawsuit against the USDA to address section 7 CFR 795.11, which states that a husband and a wife will be considered one person in determining crop payment limitations.
  In 1987 W.I.F.E. argued that a farm woman should be treated the same as any other adult farm participant and be allowed to apply to separate person status. Marital status should not be a discriminating factor.
  I am not here today to discuss crop payment limitations. I am here, however, to reiterate our concern that a woman is still not recognized a person in her own right in regard to matters concerning agriculture, even when she is an active participant in a farming operation.
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  In 1997, women in agriculture are still finding ourselves not to be considered as a full-fledged partner in farming operations throughout the country. I would like to give you a few examples taken from a survey of farm women throughout the country.
  A farm wife spends days compiling all production records in preparation for a visit with the local Farm Service Agency. When they, husband and wife, partners in farming, arrive, all questions are directed toward the husband because he is recognized as the farmer. Is this not discrimination?
   Four sisters in Nebraska inherited a family farm. Three of the four live in town and are not married to farmers. They are not involved in the actual operation of that farm. And, yet, they are fully recognized as an entity or person in regard to that operation.
  The one sister who is a farmer actually involved in the operation of the farm is not recognized as a separate person or entity because she is married to someone who is recognized as a farmer.
  In actuality, this woman is the farmer. Her husband is the school teacher. Yet, everything at the FSA office is in her husband's name. In this instance, marriage causes her to lose her identity as a person. Is this not discrimination?
  Consistency in interpretation of rules and regulations within the Farm Service Agency throughout the country we consider to be a major problem. In some areas of the country, women are clearly recognized as a separate person when she meets the criteria.
  In other areas, we know women who are still struggling to prove themselves as a person. An issue not in regard to person status but that of equality is that women are not recognized as an integral part of farming operations throughout the country. We're just married to the farmer.
  Our signatures are required on all paperwork. We are responsible for the debt on the farm. Yet, in too many instances, only our husbands are considered the farmer. Is this not discrimination?
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  We would like to see more women represented on USDA boards who are in production agriculture. Granted, there are more women serving in these positions today than 10 years ago. However, there is still room for improvement. We need more knowledgeable, qualified women on these boards.
  We are not here to suggest that women be placed in these positions just because they are women. There are many knowledgeable women across the Nation whose expertise is not being put to use because more often than not women remain unrecognized as farmers.
  Section 401(b) of the ASCS handbook, 22-PM creates a vast travesty toward women who would be excellent members of such boards and committees. According to this handbook, county ASCS committee members may not hold any State or national level positions in general or specialized farmer commodity organizations.
  The implementation of this rule is not consistent across the country. We know for a fact that some of our members are allowed to hold positions on county-elected FSA committees while serving in the capacity as a State or national W.I.F.E. officer. In other States, W.I.F.E. members have been refused the opportunity to serve on such committees because of their officer status in our organization.
  W.I.F.E. disagrees with the inconsistency in implementing the rule, but, most importantly, W.I.F.E. finds the rule itself creates an injustice to our industry. The ruling disqualifies so many knowledgeable individuals, both men and women, from serving on boards and providing valuable input.
  W.I.F.E. urges the USDA to change regulations to allow qualified persons to serve on board positions without discrimination to those who serve on general farm organizations at the State and the national level.
  A person is by definition a human being. Are you a person? Unless you happen to be a woman and you happen to farm and you are married and certainly if your spouse is a farmer, too, then all responses to that simple question and to related questions become subject to the view of the United States Department of Agriculture, an agency, and its rules and regulations and its definitions and opinions.
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  Thank you.
  [The prepared statement of Ms. Felzien appears at the conclusion of the hearing.]
  Mr. GOODLATTE. Thank you.
  Mr. Windy Boy, welcome.
  Mr. WINDY BOY. Thank you, Mr. Chairman.
  Mr. WINDY BOY. My name is Alvin Windy Boy. I'm a full-blooded Chippewa Cree Indian from Rocky Boy, MT. It gives a great pleasure to me to be back here.
  I didn't mean to bring the snow with me, but I wanted to kind of give some inkling of what we as Indian minority producers in Montana are having to adhere to in the last several months in Montana, Wyoming, North and South Dakota.
  Mr. Chairman, we are an organization made up of federally recognized tribes of both the lower 48 and the Alaska Reindeer Herders Association.
  There are many issues that are addressed in the document that was provided to you, issues that I hope your committee can address and provide answers to the Indian producer.
  There are several instances that I want to cite here that we as minority producers in Montana, we talk about foreclosure, maybe someday my people in Indian country might also want to foreclose on this land.
  Years ago our people provided expertise, knowledge to the white people that have come from the eastern parts of this country, sustained them in a livelihood that we as Indian producers are still attempting to maintain. Rules, regulations have come about that we have to adhere to. Many treaties have been signed. Over 550 have been signed.
  I hope the direction that this committee is undertaking with the issues that the Intertribal Ag Council have brought forward would be closely monitored. One issue that I'd like to address is the situation that we're dealing with with the Montana and Wyoming Stock Growers Association.
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  This association is new, 2 or 3 years old, but we have close to 700 members, Indian farmers and ranchers in Montana, close to 200 in Wyoming, the two States that we represent. We maintain close to 9 million acres of tribally owned land in that area. We in Montana make up close to about one-fifth of the cattle population in Montana.
  There is what we call the national beef check-off program that supposedly is assessed to all producers nationwide. And supposedly in Montana we have a Montana beef council check-off program. The seven reservations in Montana, the producers on those reservations are paying that dollar, and rightly so. Fifty cents of that dollar goes to the national office. Fifty cents goes to the State.
  Our question has always been that government to government relationship, that issue the tribal governments have with the United States Government. Is it not just a photo opportunity that happened back in 1994 on the South Lawn of the White House, which I was a part of?
  I had hoped that what had happened was all the Indian tribal leaders in Indian country that assembled there, that we would really have that true government to government relationship. We don't.
  If we maintain one-fifth of the cattle in Montana, then we should be able to sit on the Montana beef council's check-off board of directors. We don't. There are 12 members on that board, a representative of different organizations in Montana, of which our organization is not.
  I commend the nine delegates that are delegated by each of the tribal governments that sit on this particular Stock Growers Association Board. I commend that board for being involved with the CRP. We have been involved in a number of outreach projects, outreach projects that we feel are long overdue.
  I do have, Mr. Chairman, a document from the Montana and Wyoming Stock Growers Association on an issue that is of very critical nature as we speak today. And that is the Emergency Feed Program.
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  A memorandum of agreement that was put together by the Bureau of Indian Affairs, an organization that I really don't feel I have much high regard for, and the United States Department of Agriculture. That penalizes Indian producers.
  Reservations in Montana maintain about 60 to 80 percent unemployment rate. Yet, this agreement that I have that is ratified by both agencies, makes it impossible for the Indian producer to qualify for emergency feed. And this document addresses that.
  We have a project that we are attempting to work on, and that is the American Indian beef products. We understand that the meat industry is maintained by three to five major companies. We feel that Indian beef that we raise on our reservations is top quality and that there is an attempt to provide that top-quality Indian-raised beef to the world. We feel that it's unique in nature, that we don't implant, we don't inject hormonal implants in our animals.
  And it's a great opportunity, Mr. Chairman, to sit before you and address some of the concerns. The document that we're leaving here is self-explanatory.
  Thank you.
  [The prepared statement of Mr. Windy Boy appears at the conclusion of the hearing.]
  Mr. GOODLATTE. Thank you. That will be made a part of the record, and we thank you for your testimony.
  Mr. Vue.
  Mr. VUE. Thank you, Mr. Chairman, and members of the subcommittee for giving me this opportunity to testify on the treatment of minority and limited resource producers by the U.S. Department of Agriculture.
  My name is Pheng Vue. I'm a farmer. Before I became a farmer, I was working for Hmong Organization. We receive funding from the Federal Government, local government to provide education, social adjustment, job development to our people. Nowhere do programs protect the Southeast Asian farmers.
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  Day to day, year by year many farmers are approaching me asking for assistance. I made a decision that I should quit my job and join them as a farmer, see what kinds of problems they have. So I become a farmer.
  I have been a farmer almost 6 years. Mr. Chairman, about 15 years ago, I mean, back in 1980, there were less than 30 Southeast Asian farmers in the San Joaquin Valley of California. In 1988, the number increased to about 800 farmers, today more than 1,000 Southeast Asian farmers in the San Joaquin Valley of California.
  We produce strawberries, cherry tomatoes, greenbeans, sugarpeas, squash, and many other Oriental vegetables. The total production values are over $30 million each year. The annual contribution to the agribusiness in the San Joaquin Valley are over $10 million from purchasing farm supplies, fertilizers, equipment, seeds, plants, and give the employment opportunity to the community.
  Along with what I stated, Southeast Asian farmers face a major disadvantage from not able to share the same profits as other groups. Each year Southeast Asians were able to produce lots of products. However, we could not find enough brokers to purchase our produce. More and more brokers say that American markets are too expensive. They prefer to import from other countries.
  This resulted in losing tons and tons of our crops each year. In addition, many times we were forced to sell our produce in a lower price, which could not even cover our labor costs. For this reason, how can we survive as we continue to produce our products to support our families?
  Today there are only two companies in the local area which is willing to buy our strawberries from the Southeast Asian farmer. However, both of these companies did not want to purchase the large volume of strawberries. Therefore, at this present time, any farmer who wishes to grow different kinds of strawberries worries that the market may not be suitable for them to grow at the meantime.
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  We are also facing other major problems. There is no local lender willing to loan money to our people. Even though several of us have been banking at the same bank over 10 years, when we applied for a line of credit, we were denied. These practices did not and have not been very helpful to our community as we share the burden of paying income taxes to support this great country, just like any other American people.
  For all the years of farming that I recall since I joined them as farmer, we have never received any source of support from neither the local, State, or Federal Government such as farm loan, loan guarantee, or Farm Disaster Program.
  For example, in 1994, we have 16 Southeast Asian strawberry farmers suffer damage from the storm that destroyed their strawberry fields, about 90 percent of their crop. Our farmers contacted a Government agency in the area, but none of them would respond.
  The farmers also contacted the Farmers Home Administration in Fresno County for assistance, hopefully to qualify for receiving the Farm Disaster Program and the Loan Guarantee Program, but at the end, the answer was no. The USDA people said that they have never heard of any Southeast Asian farmers in the Central Valley of California and they don't have staff available to help. The same problems continue until today.
  Well, Mr. Chairman, since I have to share time with Dr. Chang, in my conclusion here, I would like to request you to look at my testimony. And I would like to request you to support us because we are Southeast Asians coming to this country without preparing. When we come here, we have only one skill: go back to farming. So please read my testimony and give us help.
  Thank you.
  [The prepared statement of Mr. Vue appears at the conclusion of the hearing.]
  Mr. GOODLATTE. Thank you, Mr. Vue. We appreciate your testimony, as we do all of the witnesses.
  Mr. Powell, what steps were taken by the Department with regard to the particular instance of discrimination that you experienced and you recounted in your testimony? Has the Department looked into that matter? And have they conducted any kind of investigation or taken any action as a result?
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  Mr. POWELL. Yes. They conducted an investigation and found affirmative findings that was discriminated again, but that is as far as it has gone. Nobody has done anything to try and compensate myself nor several other farmers with the same affirmative findings.
  Mr. GOODLATTE. How long ago was that finding made?
  Mr. POWELL. I think it was in 1992 or 1993.
  Mr. GOODLATTE. And have they left this record open? Did they say they would be back in touch regarding some action to be taken on it or——
  Mr. POWELL. Well, we have been trying to work with them. And nobody has done anything to compensate me or no one else on these issues. All they would do is they would talk about it.
  Mr. GOODLATTE. Is the file still open?
  Mr. POWELL. Yes, sir, the file is still open.
  Mr. GOODLATTE. When is the last time you had any communication with them about that?
  Mr. POWELL. My attorney has been keeping the communication with them. I think he talked with Mr. Reeves sometime this week. But we have been getting talk all the time. These sessions like today and other days, they are very good. We appreciate them.
  This is time when all farmers need to be preparing their land, getting it ready to make a crop for the 1997 crop year. And if they're having trouble getting the loan, then it's going to be a lot of farmers that will not be able to plant a crop this year. This is March. Corn should be planted this month to be profitable.
  Mr. GOODLATTE. But we will hear the Department's comments on that and other matters when we take that up with them hopefully within the next month or so. We are expecting the opportunity either at the subcommittee or the full committee level to hold some further hearings, hear the Department's report and their recommendations.
  Mr. Boyd, you had indicated in your testimony that there were 1,500 complaints pending at the Department of Agriculture, but only 271 of them have been acknowledged. Is that your position?
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  Mr. BOYD. That's correct.
  Mr. GOODLATTE. What do you base the 1,500 figure on?
  Mr. BOYD. Based on complaints that I have seen come through my organization. There are 168 active complaints in Virginia. They've got on that list that I gave you somewhere in the neighborhood of 15.
  I mean, why? I don't understand what's going on. Why have this Office of Civil Rights if nothing is going to be implemented there? This is the whole problem at the Department of Agriculture. There is no implementation at the Department. There is no accountability at the Department. And the Department of Agriculture needs major overhauling.
  Mr. GOODLATTE. Ms. Felzien, what rules prevent officers of your organization from running for FSA County Committee positions?
  Ms. FELZIEN. It's section 401(b) of the ASCS handbook, 22-PM.
  Mr. GOODLATTE. And what do you think is the rationale behind that on the part of the Department?
  Ms. FELZIEN. I really do not know.
  Mr. GOODLATTE. If these prohibitions were removed, what do you think is the best process to select the most qualified women to serve on county committees?
  Ms. FELZIEN. Going through the county committee. If we're addressing our county committees, you have to be a landowner. You fill in the application and have the ballot throughout the county. But she should at least be allowed to have the ability to run or he.
  Mr. GOODLATTE. Have you personally experienced difficulties obtaining a loan or other services through the FSA?
  Ms. FELZIEN. No because I am just married to a farmer. I can only have the power of attorney. I am not considered a person that's able to do that.
  Mr. GOODLATTE. Mr. Windy Boy, does the Bureau of Indian Affairs have any kind of outreach or educational programs to help Native American producers?
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  Mr. WINDY BOY. In the light of the way the Bureau of Indian Affairs is downsizing and reducing their funding through both Congress and the Senate, nothing that would really address agriculture per se.
  Mr. GOODLATTE. And, Mr. Vue, have you gone to a county FSA office to apply for a loan? And if so, what kind of experience did you have?
  Mr. VUE. When we go to apply for this kind of loan, the first question they're going to ask, they ask ''What kind of crop do you plant and how many acres you have?'' That's what the question they would ask.
  Mr. GOODLATTE. All right. Thank you. Those are all the questions that I have.
  The Chair recognizes the gentlewoman from North Carolina.
  Mrs. CLAYTON. Thank you, Mr. Chairman.
   I want to just observe that, as I might have observed when I thought the GAO was limited in scope, certainly the total effect of all of your testimony shows how pervasive and how widespread the discrimination is and how it's not any one group or one gender. It's there, and it comes in subtle ways. And it affects real people and timing.
  Sometimes the rules are not only things that cause persons to be denied of their resources, but it's attitudes. It's processing. A violation of the rules obviously is something you can get at, but you cannot get at how people respond to other human beings or you can't get at how slowly or how swiftly people process or what assistance is given and what indeed information is withheld and not told.
  Mr. Harris, you have been doing this for a long time. And I gather sometimes we can get cynical, not because you're a lawyer. Lawyers are cynics anyhow. But sometimes you can get cynical.
  You've gone through some of these. Do you perceive any change in attitude that gives you any sense of hope that maybe we won't just go through this again, that you're not all over again, deja vu all over again, that we really are serious there is a sense of hope for you in this process?
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  Mr. HARRIS. There is a sense of hope. I have a sense of hope with respect to the members of the Agriculture Committees for both the House and Senate. Over the past 4 to 6 years, there have been new faces, who are very much concerned about these issues and have come from districts where their constituents are directly impacted.
  The fact that we have been able to discuss these issues with the current and the past Secretary of Agriculture; whereas, before we couldn't even meet with the person, is encouraging. The fact that we are having these types of meetings and hearings is encouraging.
  The caution that I do have is in the reality that, regardless of what happens in Congress and at the top levels of USDA, you still have the second or third largest bureaucracy in this country, which is entrenched.
  Mrs. CLAYTON. The second.
  Mr. BOYD. The second? Thank you.
   And it has a very institutional plantation mentality. And if we're not careful, all of our work will be for naught.
  Mrs. CLAYTON. There are also recommendations in the civil rights report that the Department of Agriculture recognizes that entrenchment or that system. And the accountability I guess is—we need to find a way where we are accountable.
  They have made some recommendations. Any comments on any of those recommendations that you have? That goes for any one of you on that to think that they would—do you see the recommendations that were in the civil rights report getting at the accountability issue, where the rules of the Federal Government now can be monitored and someone can be held accountable for their action if they are found discriminating, that someone above them can take—are you comfortable with what you know has been recommended? Mr. Boyd?
  Mr. BOYD. It talks about accountability, Congresswoman, but the time frames that Secretary Glickman and Messrs. Perle and Reed have come to are not acceptable. What are we going to do this month if we don't have any operating money? What are we going to do about the foreclosures that I have been attending in the States of North Carolina and Virginia?
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  Why can't we get someone to acknowledge these problems and do something about them? Why do we talk to 15 and 20 people about the same problem and no one can give you a straight answer? Why haven't these settlements been paid?
  There's a process apparently that has been put in, an administrative process, by Secretary Glickman. Mr. Reed indicates that he doesn't have the resources yet. When will he get those resources?
  What happened to this $11 million that Senator Robb said you all appropriated to start settling these cases? When are these things going to take place for us, Congresswoman? These are the serious concerns that we have today if we're going to make this thing a real turnaround.
  Mrs. CLAYTON. Your point is that farming is time-sensitive?
  Mr. BOYD. Yes, ma'am.
  Mrs. CLAYTON. And to ignore the fact, if you're going to do anything, make sure you have to have operation money now?
  Mr. BOYD. That's right.
  Mrs. CLAYTON. So a delayed decision is a denied opportunity for you?
  Mr. BOYD. Right. You have interest on top of these loans that's building up, Congresswoman, if we don't get these crops in the ground this year. We cannot afford to sit out another year with no operating money.
  Mrs. CLAYTON. You need some response now.
  Mr. BOYD. Yes.
  Mrs. CLAYTON. I can't speak for members of the committee, but I sense on both sides of the aisle there is just a zero tolerance for discrimination. But that's a different thing to saying we understand the sensitivity of the timeliness and how critical it is for us to move expeditiously to make sure what we find intolerable is removed and find some implementation.
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  I wanted to ask Ms. Felzien: The handbook that you were referring to, did you know the date on that? Is that consistent with the reorganization plan that was implemented in 1994? Help me on this.
  Ms. FELZIEN. The handbook we had photocopied sent from New Mexico State FSA Office. And they're operating under a 1989 book.
  Mrs. CLAYTON. I thought so because, Mr. Chairman, I just want for the record, you know, we have a reorganizational structure now. And now there's handbook that is prior to that and which has this language that says that women are not—well, she referred to the language as in section 401(b) of the ASCS handbook. And that's a handbook that hasn't been made in compliance with the new law of the reorganization plan.
  Mr. GOODLATTE. You say it has or has not been?
  Mrs. CLAYTON. Has not.
  Mr. GOODLATTE. It is out of date, in other words?
  Mrs. CLAYTON. It is out of date. And this is the handbook that's precluding them from either serving on committees or for being treated as a separate entity if they happen to be farmers in that area.
  Ms. FELZIEN. That's correct.
  Mrs. CLAYTON. Would you bear with me to ask some other questions?
  Mr. GOODLATTE. Yes. Without objection.
  Mrs. CLAYTON. All right. Thank you.
   I wanted to ask Mr. Windy Boy, as you noted in your observation that you were willing to not foreclose on that. I liked that little pun that you had. That was a little subtlety. We didn't quite all understand it, but I appreciate that you owned the land before we owned the land.
  Given that, you raise in your testimony that because you don't pay taxes, that you have found it difficult to get some of the services that normally other citizens get, particularly through the Extension Service. Am I misinterpreting that?
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  Mr. WINDY BOY. Yes. In fact, we do pay taxes. All tribes do pay Federal taxes.
  Sitting in the back there, in reference to the GAO report, there was a county in Montana that has the Blackfeet Indian Reservation as a part of it. I just want for the record that that is not reflective of Indian country.
  Mrs. CLAYTON. That particular——
  Mr. WINDY BOY. Right.
  Mrs. CLAYTON. But are you having difficulty receiving services from the—did I misread your testimony that I read last evening? Are you having difficulty receiving services from the Extension Service?
  Mr. WINDY BOY. Yes, we are.
  Mrs. CLAYTON. What's the difficulty? And what's that based on?
  Mr. WINDY BOY. Based on individual reports back to the Intertribal Agriculture Council, headquarters office in Billings.
  Mrs. CLAYTON. Has there been any effort to resolve that with Agriculture?
  Mr. WINDY BOY. Not as such yet.
  Mrs. CLAYTON. Mr. Vue, I think you made the observation that you are not subsidized, receive no guarantees. And basically I share with you the product. And California is always reminding us that their crops are unsubsidized. But there is no reason why you shouldn't receive the right to make an application for a loan or the right to make application for disaster assistance or crop insurance as anyone else.
  True, row crops and vegetables and fruits are not subsidized as perhaps peanuts or—well, peanuts are not either; that's what we say, I think that's what we say—or as wheat and corn and others?
  But what's the basis of it? They don't know you as a farming group or is there something written that you want to refer to us to look at as to why they are denying you the right to make an application or——
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  Mr. VUE. Yes. The second question right after the same question the chairman asked me, that people, USDA people at the Farmers Home Administration, they ask you about what kind of crop you plant, how many acres.
  And when you tell them you're a strawberry farmer and you tell the number of strawberries and they say, ''I don't think you are qualified for the loan, but I don't think you have the ability to fill out the Government paper. It's too much. And we don't have staff here available to help you.''
  Mrs. CLAYTON. That's what I'm responding to.
  Mr. VUE. That's what they told us. And we have no choice. Then just go home.
  Mrs. CLAYTON. I'm responding to your answers that say there is nothing, no basis in law that says that because you grow strawberries that you're not eligible to make an application unless they gave you something that you could help us. Because you grow strawberries is not a basis for denying you the right to have an application.
  Mr. VUE. I don't quite understand what you're coming——
  Mrs. CLAYTON. Doctor?
  Mr. CHANG. I think this is an example about discrimination against Southeast Asians or Asians as a whole. I have my name here, but even appalled. At the outside, it has taken us 20 years to come to this far today.
  The amount throughout the country, we have many people. We served before with the American armed forces, and we picked up the American pilots. And now we even not get a chance to talk.
  And back to your question, back in the old country, we are farmers. I brought Mr. Pheng and a couple of former soldiers here. They are farmers. They are farming in California and Wisconsin, Minnesota, Florida.
  And they do not get any support from the USDA, including anything, like Mr. Pheng Vue mentioned, when you ask. And they look at your face, look at your black hair. They don't want to talk to us. That's why we come in here, Mr. Chairman.
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  And I hope that you take some time to listen to us. There is no one out there listen to us. I served only last February 28 when they removed the national development on the Government. We represent hundreds of organizations throughout the country. We have 350,000.
  And I just walked to the USDA office and testified with Mr. Dan Glickman. And then Mr. Glickman assigned Mr. Schumacher to visit Hmong in Fresno. So this is an example. This is the first time in history for Hmong in Southeast Asia.
  And I think you need to spend some time and listen to us. I know that this is strong language, but we need your support.
  Mrs. CLAYTON. Thank you.
  Well, I think the reason you're here is that we want to learn from you as well.
  Mr. Boyd, did you submit the names or the lists of the foreclosures that you said occurred since the moratorium?
  Mr. BOYD. Yes, I did.
  Mrs. CLAYTON. So it's part of your record. That's what I just wanted to make sure.
  Mr. BOYD. Right.
  Mrs. CLAYTON. Mr. Powell, I want to followup also on the chairman's question as to what has happened. During the time of the rewriting of your procedure, Mr. Powell, did anyone tell you what your appeal right was then in 1994?
  Mr. BOYD. No.
  Mrs. CLAYTON. Not Mr. Boyd. Mr. Powell.
  Mr. POWELL. Pardon me again?
  Mrs. CLAYTON. You were describing to us the procedure you went through right up until your father died and the rewriting of the application. Did anyone tell you then what the appeal process—how you could bump your appeal process up? Because I'm wondering why since that time you weren't one of the 28 that was resolved if yours happened in 1990.
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  Mr. POWELL. Yes, ma'am. It was around 1990.
  Mrs. CLAYTON. 1990.
  Mr. POWELL. Somewhere in that area. No, ma'am, I was not advised of anything.
  Mrs. CLAYTON. When did you have an appeal process to be forward?
  Mr. POWELL. My appeal to appeal the decision of Mr. Thurman?
  Mrs. CLAYTON. Yes.
  Mr. POWELL. I believe it had to have been in 1991.
  Mrs. CLAYTON. Did Mr. Thurman tell you this is the decision. And now here are your appeal procedures?
  Mr. POWELL. Well, yes, ma'am, they did.
  They said, ''You have the right to appeal.'' And that's all they left it at.
  Mrs. CLAYTON. Did they tell you how?
  Mr. POWELL. No, ma'am, he didn't.
  Mrs. CLAYTON. Again, Mr. Chairman, I think this evidence is overwhelming. I'd paraphrase a little bit of what Secretary Glickman said, that it saddens you. It also angers you that people have to go through this to try to just make a decent contribution.
  And it also saddens you because a segment of the population that is supposedly feeding all of us. And, yet, we ignore that kind of basic contribution. Hopefully this is not again exercised.
  Mr. GOODLATTE. Well, the gentlewoman's comments are right on target. And I very much appreciate her contribution and participation in this hearing.
  And I would also like to note the presence of another member of the full committee, Congressman Virgil Goode from my neighboring district, whose constituent is Mr. Boyd. You may want to get together and chat with him after the hearing is over. We're always glad to have Congressman Goode with us.
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  Do we have any other business to come before the committee? Do you have any other questions you would like to ask?
  Mrs. CLAYTON. No, I don't, but I do want to just make the observation that the chairman of the full committee at our request has scheduled a hearing sometime in April. And what he said, he will make that date known more fully when Secretary Glickman has had time to have a report and some implementation.
  So I think this is one of perhaps two hearings of this committee. So this is an indication of the seriousness of it, but we want to encourage those witnesses to feel free to write to the committee or to share with us any further information they may have.
  Mr. GOODLATTE. Yes. If you are aware of other instances of discrimination or other developments occur with regard to the matters you testified to, please do not hesitate to write to us.
  We are very concerned about this problem. We look forward to hearing the testimony of the Secretary or his representative probably at a full committee hearing. That date has not yet been set, but we hope it will be soon.
  And I do think the Secretary has taken a very sincere interest and is concerned about this problem and will be forthcoming with a number of recommendations regarding how to handle that. And we will welcome your comments on those recommendations as well.
  Mr. Boyd?
  Mr. BOYD. Mr. Chairman, since the short notice, I'm going to ask the committee would you all allow me 1 day to make a prepared statement and forward that to you?
  Mr. GOODLATTE. You'll have not 1 day but 10 days.
  At this time, in light of that request and others that may be forthcoming, 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.
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  Let me say in closing that, again, this is a matter that is of grave concern to me. A number of these instances of discrimination appear to have taken place in my State of Virginia. Fortunately, I'm not aware of any that have taken place in my particular Congressional district, but that does not in any way diminish my interest and concern in making sure that every agency of the Federal Government, particularly the one that Mrs. Clayton and I have oversight responsibility for, treats everyone who seeks the assistance of that agency in an equal and fair manner.
  And, with that, I will thank all of these witnesses for their contributions. Some of you have traveled great distances, and some of you on very short notice have come. We do very much appreciate your participation.
  This hearing of the Subcommittee on Department of Operations, Nutrition, and Foreign Agriculture is adjourned.
  [Whereupon, at 4:33 p.m., the subcommittee was adjourned, subject to the call of the Chair.]
  [Material submitted for inclusion in the record follows:]
  Mr. Chairman and Members of the Subcommittee:
  We are pleased to be here today to testify on the work we have done on the U.S. Department of Agriculture's (USDA) efforts to achieve equitable treatment of minority farmers. Our testimony today is based on our January 24, 1997, report.
  Let me place our work in the context of concerns about this issue. As you know, the number of minority-owned farms is declining at a more rapid rate than other farms, which has called into question the treatment of minority farmers in receiving Federal assistance. Furthermore, for a number of years, minority farmers have reported that USDA officials do not treat them in the same way as nonminority farmers in the conduct of USDA's programs, particularly in decisions made in the Department's county offices and district loan offices.
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  Because of these concerns, we were asked to review the efforts of USDA's Farm Service Agency (FSA) to treat minority farmers fairly. As we were nearing completion of our work, the concerns of several minority farmers were publicized, leading the Secretary of Agriculture to take a number of actions, including holding national and statewide forums on the treatment of minority farmers. At these meetings, minority farmers made a number of charges of discriminatory practices in USDA. For example, they charged that USDA officials deny them courtesy and respect while giving large-scale farmers service and loans. They also charged that the loans of minority and small farmers are not processed in a timely manner and that FSA is foreclosing on minority-owned farmers at a higher rate than on nonminority-owned farms. Finally, they stated that FSA lacks diversity in the state and county committee structure and county office staffing. During this time period, the Secretary suspended all foreclosures on farm loans.
  Our testimony today focuses on the work we did to (1) identify FSA's efforts to treat minority farmers in the same way as nonminority farmers in delivering program services; (2) examine the representation of minorities in county office staffing and on county committees in the counties with the highest number of minority farmers; and (3) examine data on the disposition of minority and nonminority farmers; applications for participation in the Agricultural Conservation Program and the direct loan program at the national level and in five county and five district loan offices for fiscal years 1995 and 1996. Because of the small number of offices we visited, we cannot generalize our findings to FSA's offices nationwide.
  In summary, we found that the Farm Service Agency's Civil Rights and Small Business Development Staff (the Staff) oversees the agency's efforts to achieve fair treatment for minority farmers. In fiscal years 1995 and 1996, the Staff closed 28 complaints of discrimination against farmers on the basis of race or national origin and found discriminatory practices in 2 of the 28 cases. The Staff also conducted 13 management reviews of field offices and found no evidence of unfair treatment. Finally, according to the Staff, they are in the midst of training all FSA personnel on civil rights matters; the Staff projects that this training will be completed by the end of 1997. We did not evaluate the quality and thoroughness of the staff's activities.
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  With respect to the representation of minority employees in the Farm Service Agency's field offices, USDA's database showed that, as of October 1996, 32 percent of the employees serving the 101 counties with the highest number of minority farmers are members of a minority group. Moreover, for the same period, 89 percent of these minority employees were either county executive directors or program assistants. Minority farmers make up about 17 percent of the farmer population in these counties. Furthermore, in 36 of the 101 counties, at least one minority farmer is a member of the county committee.
  Finally, the applications of minority farmers for the Agricultural Conservation Program for fiscal year 1995 and for the direct loan program from October 1994 through March 1996 were disapproved at a higher rate nationwide than for nonminority farmers. We found that disapproval rates for minority farmers were also higher at three of the five county offices and three of the five district loan offices we visited. However, our review of the information in the application files at these offices showed that decisions to approve or disapprove applications were supported by information in the files and that decision-making criteria appeared to be applied to minority and nonminority applicants in a similar fashion.
  Within USDA, FSA has the overall administrative responsibility for implementing agricultural programs. FSA is responsible for, among other things, stabilizing farm income, helping farmers conserve environmental resources, and providing credit to new or disadvantaged farmers. FSA's management structure is highly decentralized; the primary decision-making authority for approving loans and applications for a number of agricultural programs rests in its county and district loan offices. In county offices, for example, committees, made up of local farmers, are responsible for deciding which farmers receive funding for the Agricultural Conservation Program (ACP). Similarly, FSA officials in district loan offices decide which farmers receive direct loans. These FSA officials are Federal employees.
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  Under the ACP, FSA generally paid farmers up to 75 percent of a conservation project's cost, up to a maximum of $3,500 annually. FSA allocated funds annually to the states on the basis of federally established priorities. The states in turn distributed funds to the county committees on the basis of the states' priorities. Farmers could propose projects at any time during the fiscal year, and the county committees could approve the proposals at any time after the funds became available. Consequently, county committees often obligated their full funding allocation before receiving all proposals for the year.
  The district loan offices administer the direct loan program, which provides farm ownership and operating loans to individuals who cannot obtain credit elsewhere at reasonable rates and terms. Each district loan office is responsible for one or more counties. The district loan office's agricultural credit manager is responsible for approving and servicing these loans. FSA accepts a farmer's loan application documents, reviews and verifies these documents, determines the applicant's eligibility to participate in the loan program, and evaluates the applicant's ability to repay the loan. In servicing these loans, FSA assists in developing farm financial plans, collects loan payments, and restructures delinquent debt.
  For both the ACP and the direct loan program, as well as other programs, farmers may appeal disapproval decisions to USDA's National Appeals Division (NAD).
  FSA's efforts to achieve equitable treatment for minority farmers are overseen by the agency's Civil Rights and Small Business Development Staff through three separate activities. First, FSA investigates farmers' complaints of discrimination in program decisions through its Civil Rights and Small Business Development Staff. During fiscal years 1995 and 1996, the Staff closed 28 cases in which discrimination was alleged on the basis of race or national origin. In 26 of these cases, the Staff found no discrimination. In the other two cases, the Staff found that FSA employees had discriminated on the basis of race in one case and national origin in the other. At the time of review, USDA had not resolved how it would deal with the employees and compensate the affected farmers. As of January 7, 1997, the Staff had 110 cases of discrimination alleged on the basis of race or national origin under investigation. Ninety-one percent of these cases were filed since January 1, 1995.
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  Second, the Staff conducts management evaluations of FSA's field offices to ensure that procedures designed to protect civil rights are being followed. During fiscal years 1995 and 1996, the Staff evaluated management activities within 13 states. None of the evaluations concluded that minority farmers were being treated unfairly.
  And third, the Staff provides equal employment opportunity (EEO) and civil rights training to its employees. Beginning in 1993, the Staff began to present revised EEO and civil rights training to all FSA state and county employees. About half of the FSA employees have been trained, according to the Staff, and all are scheduled to complete this training by the end of 1997. The training covers such areas as civil rights (program delivery) and EEO counseling, mediation, and complaints.
  In addition to these activities, FSA has specific efforts to increase minority farmers' participation in agricultural programs. For example, since September 1993, the Small Farmer Outreach Training and Technical Assistance Program has assisted small and minority farmers in applying for loans. Over 2,500 FSA borrowers have been served by these efforts. FSA has also assisted Native American farmers by establishing satellite offices on reservations. More recently, in July 1996, FSA created an outreach office to increase minority farmers' knowledge of, and participation in, the Department's agricultural programs.
  In the 101 counties with the highest numbers of minority farmers, representing 34 percent of all minority farmers in the nation, FSA employees and county committee members were often members of a minority group.
  As of October 1996, 32 percent of FSA's employees serving the 101 counties were members of a minority group. In the offices serving 77 of these counties, at least one staff member was from a minority group. Moreover, 89 percent of these minority employees were either county executive directors or program assistants. Minority farmers make up about 17 percent of the farmer population in these 101 counties.
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  In addition, 7 of the 10 county and district loan offices we visited had at least one minority employee. The executive directors of two county offices, Holmes, Mississippi, and Duval, Texas, were members of a minority group, as were the managers of two district loan offices, Elmore, Alabama, and Jim Wells, Texas, and the deputy managers of three district loan offices, Holmes, Jim Wells, and Byron, Georgia.
  The number of minority employees could change as FSA continues its current reorganization. FSA plans to decrease its field structure staff from 14,683 in fiscal year 1993 to 11,729 in fiscal year 1997-a change of about 20 percent. We do not know how this reduction will affect the number of minority employees in county and district loan offices.
  We found that for the 101 counties with the highest numbers of minority farmers, 36 had at least one minority farmer on the county committee. In the five county offices we visited, two committees had minority members and the other three had minority advisers. We have previously reported on this issue. In March 1995, in Minorities and Women on Farm Committees (GAO/RCED–95–113R, Mar. 1, 1995), we reported that minority farm owners and operators, nationwide, accounted for about 5 percent of those eligible to vote for committee members, and about 2 percent of the county committee members came from a minority group.
  According to FSA's data, applications for the ACP for fiscal year 1995 and for the direct loan program from October 1994 through March 1996 were disapproved at higher rates nationwide for minority farmers than for nonminority farmers. To develop an understanding of the reasons for disapprovals, we examined the files for applications submitted under both programs during fiscal years 1995 and 1996 in five county and five district loan offices. We chose these offices because they had higher disapproval rates for minority farmers or because they were located in areas with large concentrations of farmers from minority groups. We chose the ACP and the direct loan program because decisions on participation in these programs are made at the local level. In addition, nationally, these programs have higher disapproval rates for minority farmers than for nonminority farmers.
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  Nationally, during fiscal year 1995, the disapproval rates for applications for ACP funds were 33 percent for minority farmers and 27 percent for nonminority farmers. We found some differences in the disapproval rates for different minority groups. Specifically, 25 percent of the ACP applications from Native American and Asian American farmers were disapproved, while 34 percent and 36 percent of the applications from African American and Hispanic American farmers, respectively, were disapproved.
  To develop an understanding of the reasons why disapprovals occurred, we examined the ACP applications for fiscal years 1995 and 1996 at five county offices. (See attachment I for the number of ACP applications during this period from minority and nonminority farmers in each of the five counties, as well as the number and percent of applications that were disapproved.)
  When ACP applications were received in the county offices we visited, they were reviewed first for compliance with technical requirements. These requirements included such considerations as whether the site was suitable for the proposed project or practice, whether the practice was still permitted, or whether the erosion rate at the proposed site met the program's threshold requirements.
  Following this technical evaluation, if sufficient funds were available, the county committees approved all projects that met the technical evaluation criteria. This occurred for all projects in Dooly County and for a large majority of the projects in Glacier County. In Holmes County, the county committee ranked projects for funding using a computed cost-per-ton of soil saved, usually calculated by the Department's local office of the Natural Resources Conservation Service. The county committee then funded projects in order of these savings until it had obligated all funds.
  In the remaining two counties, Russell and Duval, the county committees, following the technical evaluations, did not use any single criterion to decide which projects to fund. For example, according to the county executive director in Russell County, the committee chose to fund several low-cost projects submitted by both minority and nonminority farmers rather than one or two high-cost projects. It also considered, and gave higher priority to, applicants who had been denied funds for eligible projects in previous years. In contrast, the Duval county committee decided to support a variety of farm practices. Therefore, it chose to allocate about 20 percent of its funds to projects that it had ranked as having a medium priority. These projects were proposed by both minority and nonminority farmers.
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  In the aggregate, 98 of 271 applications from minority farmers were disapproved in the five county offices we visited. Thirty-three were disapproved for technical reasons and 62 for lack of funds. FSA could not find the files for the remaining three minority applicants. We found that the applications of nonminority farmers were disapproved for similar reasons. Of the 305 applications for nonminority farmers we reviewed, 106 were disapproved. Fifty-three were disapproved for technical reasons and 52 for lack of funds. FSA could not find the file for the remaining applicant. Approval and disapproval decisions were supported by material in the application files, and the assessment criteria used in each location were applied consistently to applications from minority and nonminority farmers.
  Nationally, the vast majority of all applicants for direct loans have their applications approved. However, the disapproval rate for minority farmers is higher than for nonminority farmers. From October 1994 through March 1996, the disapproval rate was 16 percent for minority farmers and 10 percent for nonminority farmers. We found some differences in the disapproval rates for different minority groups. Specifically, 20 percent of the loan applications from African American farmers, 16 percent from Hispanic American farmers, 11 percent from Native American farmers, and 7 percent from Asian American farmers, were disapproved.
  To assess the differences in disapproval rates, we examined the direct loan applications for fiscal years 1995 and 1996 at five district loan offices. (See attachment II for more detailed information on direct loan disapproval rates in five district offices.)
  Our review of the direct loan program files in these locations showed that FSA's decisions to approve and disapprove applications appeared to follow USDA's established criteria. These criteria were applied to the applications of minority and nonminority farmers in a similar fashion and were supported by materials in the files. The process for deciding on loan applications is more uniform for the direct loan program than for the ACP.
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  The district loan office first reviews a direct loan application to determine whether the applicant meets the eligibility criteria, such as being a farmer in the district, having a good credit rating, and demonstrating managerial ability. Farmers who do not demonstrate this ability may take a course, at their own expense, to meet this standard. If the applicant meets these criteria, the loan officer determines whether the farmer meets the requirements for collateral and has sufficient cash flow to repay the loan. These decisions are based on the Farm and Home Plan'the business operations plan for the farmer-prepared by the loan officer with information provided by the farmer. If the collateral requirements and the cash flow are sufficient, the farmer generally receives the loan.
  In the five district loan offices we visited, 22 of the 115 applications from minority farmers were disapproved. Twenty were disapproved because the applicants had poor credit ratings or inadequate cash flow. One was disapproved because the applicant was overqualified and was referred to a commercial lender. In the last case, the district loan office was unable to locate the loan file because it was apparently misplaced in the departmental reorganization. However, correspondence dealing with this applicant's appeal to NAD indicates that the application was disapproved because the applicant did not meet the eligibility criterion for recent farming experience. NAD upheld the district loan office's decision. The Department allows all farmers to appeal adverse program decisions made at the local level through NAD. The division conducts administrative hearings on program decisions made by officers, employees, or committees of FSA and other USDA agencies.
  The applications of nonminority farmers that we reviewed were disapproved for similar reasons. Of the 144 applications from nonminority farmers we reviewed, 15 were disapproved. Nine were disapproved because of poor credit ratings or inadequate cash flow; five were disapproved because the applicants did not meet eligibility criteria; and one was disapproved because of insufficient collateral.
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  Additionally, in reviewing the 129 approved applications of nonminority farmers, we did not find any that were approved with evidence of poor credit ratings or insufficient cash flow.
  We also wanted to obtain information on whether FSA was more likely to foreclose on loans to minority farmers while restructuring or writing down loans to nonminority farmers. Between October 1, 1994, and March 31, 1996, we found only one foreclosed loanfor a nonminority farmer in the five district loan offices we reviewed. For the five offices we visited, we also found 62 cases in which FSA restructured delinquent loans. Twenty-two of these were for minority farmers.
  Finally, the amount of time FSA takes to process applications from minority and nonminority farmers is about the same. Nationwide, from October 1994 through March 1996, FSA took an average of 86 days to process the applications of nonminority farmers and an average of 88 days to process those of minority farmers. More specifically, for African Americans, FSA took 82 days; for Hispanic Americans and Native Americans, 94 days; and for Asian Americans, 97 days.

  Thank you Mr. Chairman and members of the committee for giving me the opportunity to speak to you on behalf of the Hmong-American on the subject of the Agricultural. My name is Charlie Jonchue Chang. I am the interim executive director of Hmong National Development, Inc. base in Washington, DC.
  The word Hmong may sound very new to some of you. Let me make a brief explain to you about who are the Hmong?. Hmong is an ethnic group from Laos. In the earlier 1960's, Hmong was recruited by the U.S. Central Intelligence Agency to pickup U.S. downed pilots and collected intelligence information. After the United States pulled out from Indochina in 1975, hundreds of thousands of Hmong had no place to go but to escape Laos for Thailand and eventually moved on to settle into third countries such as France, Canada, Australia, and mostly in the United States.
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  Today, approximately 350,000 Hmong reside in the United States, over 85,000 settled in the Central Valley California, over 75,000 settled in between the states of Minnesota and Wisconsin, and the rest are scattered all over the United States.
  Mr. Chairman, after arrival in this country in the mid 1970's, we discovered that America is the land of opportunity and has lots of land available for farming. Many of our people before fighting against the communist along side by side with the U.S. special guerrilla force used to be farmers. But after resettlement in this great country, we would like to begin our new lives here as farmer again. Since the 1970's, more American families left agricultural environment and move on to joint the high tech business in the suburban areas. For this reason, the United States depends more and more on foreign agricultural to support our nation. We, the Hmong and Laotian, saw that there were golden opportunities available to continue our farming skills that we have left over in Laos to produce crops and agricultural goods to support our great country, the United States.
  Beginning in 1983, the Hmong in the Central Valley, California first leased about 100 acres of land for farming. We produced only Asian vegetables, Thai chili, and cherry tomatoes to support the local Asian markets. Today, we own over 1000 acres of these lands and leased more than 10,000 acres for farming. We produce just about everything you see on the U.S. markets such as strawberries, cherry tomatoes, greenbeans, longbeans, sugarpeas, bitter melon, eggplant, lemongrass, Thai chili, ginseng, Asian rice, and other varieties of Asian vegetables.
  With all these efforts, we received no funding or support from the U.S. Department of Agriculture. We simply operate our agricultural businesses based on our natural experiences. For this reason, we face many obstacles along our lives such as not knowing how to use pesticide, improper use of chemical fertilizer and so on. There were many incidents occurred to the community such as Mr. Gnia Vue Thao of Fresno, CA died with chemical fertilizer poisoning and Mr. Kue Vue of North Carolina was exposed to the pesticide. He too almost died.
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  According to a 1995 survey of the Fresno County, the Hmong community views agriculture as its vehicle to becoming economically self-sufficient. Based on the Hmong's agrarian background in Laos, coupled with Fresno County's strong agricultural potential, agriculture could be a good long-term and expanding source of income for the community. I strongly agree with this survey. Today, over 6,500 acres in Fresno County alone own by Southeast Asian farmers. Our farmers produce a variety of labor intensive, specialty crops including strawberries, cherry tomatoes, greenbeans, longbeans, sugar peas, bittermelon, eggplant, lemongrass, Thai chili, and other varieties of Asian vegetables. I am sure that our products have reached the markets throughout the United States.
  Mr. Chairman, throughout these years, our farmers have faced major problems such as production, marketing, finance, program and budget, and employment representation issues.
  Production. Our farmers face major challenges associated with the leasing of land, soil, quality and testing, production costs, generally lower than average yield, fertilizer and pesticide usage, and labor regulations. For the lack of English proficiency, our farmers are not quite able to follow the production practices as recommended by the Agriculture Department and local Government. Therefore, we face many problems in this issue.
  Marketing. Due to the lack of knowledge on the marketing issue, we are attempting to capitalize on our comparative advantage-labor by growing labor intensive crops. We could not utilize all of the marketing opportunities available to us to increase the average value of our crops. In order to reach higher-valued markets, we need the U.S Government to help us improving our post-harvest handling practices and new varieties and crops that may provide better returns and produce a year round supply of income.
  Finance. Our farmers have not been able to obtain agricultural credit in the short or long-term in order to expand our operations, purchase land, equipment, and pursue marketing opportunities. There is no financial institution willing to loan for long-term investment to our community. We also generally do not qualify for Small Business Association loan or meet the credit requirement for any type of loans. For these reasons, we cannot expand our operations to the best of our capability.
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  Program and Budget. I propose overall an agricultural economic development cooperative program which would offer innovative solutions to the problems identified as stated. I request a total of $15 million budgeted to assist the Hmong and Laotian farmers. I would propose that a Hmong national community-based organization such as the Hmong National Development, Inc. (HND) through the collaboration of the U.S. Department of Agriculture should be the non-governmental organization to administer and implement the program over a 5–year period. I believe that after the 5th year, this program can and should become financially self-sustaining for 1,500 Hmong/Laotian farmers in California, 400 in Minnesota, 600 in Wisconsin, 200 in North Carolina, and 50 in Florida.
   Employment Representation. For all the reasons above and with the lack of representation at the Government level, I propose that the U.S. Department of Agriculture should hire at least two Hmong-American individuals who are fluent in Hmong, Laotian, and of course English languages to work for the Federal Government. These individuals will certainly able to help Hmong and Laotian American farmers in various functions regarding farming and regulations.
  In conclusion, I believe that with your financial support and any other type of assistance, we will definitely be able to help these new American farmers in five major parts as described:
  (1) Production
  (2) Marketing
  (3) Finance
  (4) Program and budget
  (5) Employment Representation
  I believe that it is possible for us to improve our economic situation if the U.S. Government would allocate the necessary funding and resources to help us in the development of programs designed to accelerate the farming and management of business related skills to our people. These methods will guaranty many of our people get out of public assistance and any other government dependency programs.
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  In return, I believe that by the year 2002, Hmong and Laotian communities throughout the United States will be able to generate over thousand jobs, reduce welfare dependency rate by 75 percent, increase the sale of our products in the U.S. markets, export our products to foreign countries as much as possible, and produce tax revenue millions of dollars for our country.
  May God bless you and the American people.

  Thank you Mr. Chairman and members of the subcommitteer for giving me this opportunity to testify about agriculture. My name is Pheng Vue. I am the president of the California Highlander Cooperative, Inc. I am here to speak and represent this organization and the Southeast Asian American community at the Central Valley California. I will speak on the issue on behalf of our success, problems, struggle, and the needs of the Southeast Asian farmers in the San Joaquin Valley, CA.
  The word ''Southeast Asian'' composes three different ethnic groups. They are: Hmong, Laotian, and Mien. So I will use the term of ''Southeast Asian'' or ''SEA'' in my speech to represent a more broader perspective.
  Mr. Chairman, about 15 years ago, many of us have sought of farming project as our ways to make a living in this country. In 1980, there were less then 30 Southeast Asian farmers in the San Joaquin Valley. In 1988, the numbers were increased up to about 800 farmers. Today, more than 1,200 farmers are from the Southeast Asian community in the San Joaquin Valley, CA. We produce strawberries, cherry tomatoes, greenbeans, sugarpears, squash, and many varieties of Oriental vegetables. The total production values are over $30 million each year. The annual contribution to agribusiness in the San Joaquin Valley is over $10 million from purchasing farm supplies, fertilizers, equipment, seeds, plants, to the employment opportunity for the community.
  Over the years, the SEA farmers in the San Joaquin Valley have managed to overcome so many obstacles. In spite of our success, there are many obstacles still to come if we are to grow and succeed to our fullest potential.
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  We have many decade of experiences in the agribusiness from Laos to the San Joaquin Valley. We are convinced that there are still underdeveloped markets for our products. And with the help of the U.S. Government, we will be able to produce more for the markets, both domestic and international.
  As I mentioned earlier, as farmers, SEA have faced major obstacles along these years by not having the same opportunity of sharing profits as other groups. SEA had no choice, but to sell our products to the same brokers every year. That reason has left us at the mercy of the marketing expertise of others. Each year, we did not have buyers as we should, we resulted in losing tons of our products for not being able to sell. If not, we ended up forced to sell tons of products at a constant lower price than the prices originally quoted by the broker.
  Every year, many of our SEA farmers face problems of over production of cherry tomatoes, greenbeans, squash and many other varieties of Oriental vegetables. Each year, farmers ended the year with excessive products due to the brokers unwilling to find enough markets. Therefore, the problems as mentioned are often compounded when our farmers follow brokers and agencies recommendations to try new varieties of crops. The brokers often sold large amount of seeds to our farmers or sold us seeds for a new type of plant and promise to buy the products. But year after year, the brokers failed to buy all these products cost Hmong hundreds of thousands of dollars. Such practices were not acceptable to anyone, but Hmong could not complain to any officials or Hmong had no way of knowing who to complaint to.
  There are only two companies in the San Joaquin Valley willing to buy strawberries from SEA farmers. However, both of these companies are limited to purchasing large volume of products Hmong produced. Therefore, at the present time, any farmer who wishes to grow different varieties of strawberries, worries that the markets may not be suitable for them to grow at the meantime. Thus, we need your help in finding market place to purchase these products so that our people can begin planting as they wished.
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  SEA farmers have been farming in the San Joaquin Valley for over 15 years and we have never received any support from neither the local, State, and Federal Government agencies; such as farm loan, loan guarantees, nor farm disaster program.
  In 1994, 16 SEA farmers suffered damage from the storm that destroyed about 90 percent of their crops. Our farmers contacted many Government agencies in the area, but none of them were responded. The farmers also contacted the Farmers Home Administration in Fresno County for assistance hopefully to qualify for receiving the Farm Disaster Program and the Loan Guarantee Program, but at the end the answer was no. The officials said that they had never heard of the SEA farmers and they don't have staff available to help. The same problems continue today.
  SEA farmers have raised crops in the San Joaquin Valley for over 15 years. Despite the fact that we contribute over $10 million to the local economy annually, the USDA reacts to us as though we don't exist. They feeling of not necessary for us to do business with them. This is sad considering that the most of our farmers are also U.S. citizens just like any other Americans.
  In the past, the Department of Health and Human Services, Office of Refugee Resettlement, and the County of Fresno Department of Social Service have funded some local non-profit organizations to train welfare recipients to become farmers. The trainees are recruited by way of forcing and the trainers did not even have experience on farming skills. All these programs are just wasted American tax dollars. This funding would go to help improving the farmers' skills, at the end the farmers should in return able to help the welfare recipients to become self-sufficient
  Private lenders.
  Despite SEA farmers producing a total value as indicated above each year, many of us who have been banking at the same local banks over the years, are still unable to apply for a line of credit, business loan, or loan guarantee without something for collateral. For these reasons, we ask for your help in giving us equal opportunity as any other American citizens.
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  Current technical assistance is being provided to SEA farmers by non-profit organizations and some investment corporations are strictly funded by outsider marketing people, new varieties of crops and management skills training, not from the U.S. government. These programs, while providing data for the trainers and specialist to perpetuate themselves, do very little to help our farmers.
  Often those individuals who run these programs, reported to the USDA, as if they represent the SEA farmers when actually they don't even speak the language and knowing what the community needs.
  A good example of misinformation that caused major distress as follows:
  On January 12, 1997, the Department of Agriculture's Civil Rights Listening Forum announced a public listening forum. Our California Highlander Coop was not notified until January 15, 1997. When we called to reserve a seat to speak at the Forum, we were told that someone already reserved the rights to speak for the SEA farmers. The individual claimed that he spoke on behalf of the Valley's Southeast Asian farmers, but in fact he was from an organization based in San Francisco. He also was not even a Southeast Asian origin. Therefore, we request that from now on, there should be a direct contact between the SEA farmers coop and government agencies. This is essential to limit the mis-information and interpretation.
  Based on the above concerns, we the SEA request our immediate needs as follows:
  The U.S. Department of Agriculture must hire at least two bilingual Hmong individuals who are fluent in Hmong, Laotian, and of course, English. These individuals should work closely with the SEA farmer communities throughout the United States.
  Funding for technical support to develop a marketing plan and capabilities for new markets, domestic and abroad should be provide equally for SEA.
  Available funding for Southeast Asia farmers for loana with low interest rates and without collateral.
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  Access to agricultural and SBA loans just like any other qualified citizen.
  Able access to Government farm disaster loan programs.
  Fair share of government contracts to purchase agricultural commodities.
  Three to 5–year operating budget for the Co-op project for SEA.
  In conclusion, the Board of Directors and all of the members of the California Highlander Cooperative, are certain that with your help, we want to produce goods for our people. We cannot depend on foreign goods forever. Someone has to start to produce our own goods, and the SEA farmers would like to share this profits and this success in developing America a best place to live, to eat and to see. Not only for our own generation, but for our children, grandchildren, and great-grandchildren. So that they have a place to call ''America''.
  We look forward to working with you and the U.S. Department of Agriculture.

  Farmers Union's (NFU) leadership on civil rights, in an industry which has not been known for its progressiveness in this area, began many decades ago. Representing some 300,000 agriculture families, NFU is very concerned when anyone's civil rights is threatened. Aubrey Williams of the Alabama Farmers Union was one of our early leaders concerned with civil rights.
  When Franklin D. Roosevelt gave his first inaugural address, Williams decided that he belonged to the New Deal team. He went to work for the Reconstruction Finance Corporation in the South, where his skills came to the attention of FDR advisor and confidante Harry Hopkins.
  Hopkins brought Williams onto the staff of the Federal Emergency Relief Administration. There, Williams created the overall plan for the Civil Works Administration and agitated for a program for jobs for youth. This resulted in creation of the National Youth Administration (NYA), which Williams was appointed to head.
  At the same time, Hopkins kept Williams involved in the Works Progress Administration (WPA). Williams appointed blacks to his staff and provoked some animosity, but he refused to observe a color line.
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  Arriving at a Birmingham luncheon for NYA workers, he found an all-white assemblage, although he had ordered that no discrimination be shown. The white workers were seated at the luncheon tables, and the black workers were standing along the walls. Williams refused to let the luncheon proceed until tables were brought in for the black NYA workers.
  ''I want to say as a Southerner that I covenant that the black man shall have his share in a better life,'' Williams declared.
  That covenant, made so many decades ago, remains a part of the policy of National Farmers Union. As recently as last March at our 94th Anniversary Convention in Cincinnati, Ohio, Farmers Union declared:
  Although much has been accomplished to ensure freedom and equal opportunity for all citizens, regardless of color, sex, or national origin, much remains to be done.
  We support efforts to provide equality of rights for all in every aspect of life. These rights shall not be denied or abridged by the United States or any state within.
  NFU stands ready to work with Secretary Glickman, the Clinton administration and Congress to correct the inequities in program delivery. It is imperative that we all work together to achieve this objective—not only for minority and socially disadvantaged producers, but for all producers. We will see the total demise of all farm programs if we fail.
  As we have in the past, NFU will continue to work with the Federation of Southern Cooperatives, the Rural Coalition, the Family Farm Coalition and all other interested parties in our quest to remedy this situation. The ''peoples department'' is for all of the people of our great land.
  Before concluding my remarks, I must make two important statements. First, not all minority farmers are socially disadvantaged and not all socially disadvantaged farmers are minorities. We should not allow ourselves to fall into yet another trap of stereotyping of any kind.
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  Secondly, there are those who would lay the blame of improper administration of farm credit programs to socially disadvantaged farmers at the feet of the elected county committee system. The fact is that most, if not all, of these problems originated within the appointed county committee system of the old Farmers Home Administration (FmHA). These elected committees have had jurisdiction over farm lending for just over 15 months. There is certainly room for many improvements at the county level of the program delivery system, but elimination of the farmer-elected committee system is not the answer. NFU calls for the preservation of the elected committee system while improving delivery of all programs to all producers, especially the socially disadvantaged.
  As I emphasized before, NFU is ready to assist in making the system work for all, equally. We reaffirm the covenant of Aubrey Williams.

House of Representatives,
Committee on Agriculture,
Washington, DC.
  The committee met, pursuant to call, at 3:00 p.m., in room 1300, Longworth House Office Building, Hon. Robert F. (Bob) Smith (chairman of the committee) presiding.
  Present: Representatives Barrett, Goodlatte, Pombo, Canady, Hostettler, Bryant, Moran, Blunt, Jenkins, Stenholm, Condit, Peterson, Clayton, Minge, Hilliard, Holden, Bishop, Thompson, Farr, Baldacci, Berry, Goode, McIntyre, Stabenow, Etheridge, Johnson and Boswell.
  Staff present: Paul Unger, majority staff director; Bill O'Conner, policy director; Pete Thomson, Kevin Kramp, Callista Bisek, Vernie Hubert, minority counsel; Anne Simmons, John Haugen, Russell Middleton, and Wanda Worsham, clerk.
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  The CHAIRMAN. This hearing will come to order. Ladies and gentlemen and Mr. Secretary, I apologize for the lateness of the hour. Unfortunately, if you've noticed, we've been back and forth voting on the floor of the House of Representatives, so it is out of my control, but I do thank you for your patience and we will begin this hearing and take whatever time that demands.
  First, before I introduce the Secretary, let me make a statement and announce to all members that their statements, if so offered, will be made a part of the record, as will all statements and we will extend the opportunity for 10 days beyond this hearing to submit additional testimony or comments.
  The purpose of this hearing is to receive testimony and written statements revealing the U.S. Department of Agriculture Civil Rights Action Team Report. Today's hearing is a continuation of the March 19, 1997, Subcommittee on Department Operations Nutrition and Foreign Agriculture hearing, chaired by Congressman Bob Goodlatte of Virginia.
  During that hearing, the subcommittee received testimony from several producers on their allegations of discriminatory treatment by USDA. Discrimination by USDA employees against clients or fellow employees cannot and will not be tolerated under any circumstances. Every farmer, every food stamp recipient, every rancher, every rural taxpayer must have fair and equal access to all the Federal programs administered by USDA.
  The essential question is this. Are appropriate procedures and authorities available to the Secretary so that he can discover, investigate and correct abuses? At least one authority, the General Accounting Office, believes the Secretary currently has adequate tools at his disposal. The Office of Civil Rights, the National Appeals Division, the Office of Inspector General, the Office of General Counsel, the Assistant Secretary for Administration are just some of the organizations which should be playing a role in safeguarding the rights of USDA employees and clients.
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  The solution to past or current problems and the prevention of future discrimination lies not in the establishment of additional bureaucracy or programs, but in the effective management of existing resources. We support the Secretary in his goal of addressing any and all discrimination within the U.S. Department of Agriculture. And we look forward to hearing about the Department's plan to address this issue and we are committed to working with him toward that goal.
  I would also like to thank Congresswoman Maxine Waters and Congressman John Conyers, Jr. And without objection, Mr. Conyers is permitted to sit on the dais with us. And no objection heard. We are happy to have them here representing the Congressional Black Caucus. Both members have a long history of concern on issues of racial discrimination.
  Before we proceed, I would like to mention a related matter which concerns me. I have heard reports about the approach that the U.S. Forest Service is taking in an attempt to diversify its work force. The Forest Service has flatly refused to fill certain critical fire fighting positions due to strict quota policies. Abandoning common sense, in lieu of a predetermined number, is wrong.
  It is important that the Secretary take steps to solve these problems and others. Mr. Secretary, we are looking forward to hearing from you. We are interested in hearing your solutions. Please keep in mind that the committee has every intention of using its oversight authority to ensure that your reforms promoted are fair and equal under the protection of the law.
  Mr. Secretary, I am delighted that you are here and please introduce those gentlemen with you. We've just had another call for a vote, so we'll, if you have an opening statement, Mr. Secretary, we would love to hear from you. If it's longer, we will extend it when we come back. Having served with the gentleman from Kansas for 12 years on this committee, I highly respect him and I appreciate him being here. And aren't you unhappy that you left this lovely body?
  Secretary GLICKMAN. I really do miss running back and forth, I have to tell you. Well, I'll tell you what, I would like to make my statement. I think it may take about 8 or 10 minutes, so do you want me to begin, Mr. Chairman, and, or do you want go vote and come back?
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  The CHAIRMAN. I would like some continuity. I think I would prefer it, if members do not mind, we'll recess for the moment, we'll vote, come back and I'd like to give you plenty of time for your statement.
  Secretary GLICKMAN. All right, thank you.
  The CHAIRMAN. So we are going to recess until after the vote.
  The CHAIRMAN. The hearing will come to order. Again, I apologize for the tardiness of this committee, it could not be helped. Mr. Secretary, I just want you to know that when the House learned that you were here, they just adjourned for the weekend. You have very, very great power, I wish you'd stay around a little longer.
  Mr. Secretary, if you don't mind, Mr. Stenholm was tied up on the floor. I would like to recognize the ranking member from Texas and I think he has a statement.
  Mr. STENHOLM. Thank you, Mr. Chairman. Thank you for your cooperation and assistance in holding this hearing today. And I would especially like to extend a warm welcome to the Secretary for appearing before the committee. It seems that we have had too few occasions to hear from our former colleague in this room and I regret the circumstances that bring him here today.
  It is important that we talk about the problems of discrimination within the Department and continue to work with the Secretary to address them. We cannot allow discrimination by USDA employees against program participants. Nor can we tolerate discrimination between USDA employees. I'm sure that many of my colleagues share my frustration with the length of time it has taken to address and resolve this situation.
  Frankly, I am also frustrated the Department has not yet provided us with legislative language to consider during this Congress. There are several very important issues that we in Congress will need to consider as part of the Civil Rights Action Team's report. Because of the lateness of the session and lack of legislative language, however, I am concerned that action this year may be problematic.
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  Let me say that I was pleased by the Secretary's announcement of the National Commission on Small Farms. I would note that many of the recent problems which have been brought to our attention by minority farmer organizations, are similar to problems faced by limited resource and small farmers and ranchers throughout the country, regardless of race, color, creed or national origin. Beneath much of the frustration and anger we have heard is the inability of limited resource producers to get started or survive in agriculture.
  And that is why I believe we must continue to tackle both problems, wiping out discrimination and racism at the Department of Agriculture and finding ways to assist limited resource producers who want to be involved in Agriculture production. We must ensure that all have an equal opportunity to attain that dream.
  Again, I want to thank the chairman for calling this hearing and I hope that we will have additional opportunities to receive and discuss testimony from other parties in an effort to improve civil rights within USDA.
   I would ask unanimous consent to include in the record the statement of the Honorable Mary Frances Berry, chairman of the U.S. Commission on Civil Rights. I requested that the Commission submit testimony for the record and I will look forward to hearing from her in person at a later date.
  The CHAIRMAN. Without objection, so ordered. I thank the gentleman.
  [The prepared statement of Ms. Berry appears at the conclusion of the hearing.]
  The CHAIRMAN. Finally, Mr. Secretary, we are going to listen to you with rapt attention.
  Secretary GLICKMAN. Thank you. Thank you, Chairman Smith, my friend Bob and Charlie and all the members of this committee.
  The CHAIRMAN. I'm sorry, excuse me Mr. Secretary. I announced earlier, Mr. Hilliard, there would only be two statements and your statement is certainly welcome, we want to make it part of the record. I was concerned that there might be 50 statements and as you know, that would take more than 4 hours before we would get to the witness.
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  I don't want to cut you off, you'll have plenty of ample opportunity to question the Secretary. I hope you would use that opportunity. Thank you.
  Mr. HILLIARD. Well, I have a statement for the record, Mr. Chairman.
  The CHAIRMAN. Thank you, I appreciate that. And any member who has a statement for the record is welcome, we accept them all.
  And as a I announced earlier, anyone who wants to add additional comments to the record, the record will stay open for 10 days after this hearing for anyone who wants to contribute.
  [The prepared statements of Members follow:]
  Mr. Chairman, thank you for holding this hearing to review the U.S. Department of Agriculture's Civil Rights Action Team Report.
  The Declaration of Independence states that ''***all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are life, liberty and the pursuit of happiness.''
  By making this statement the Founding Fathers realized that in order to create a free society, every citizen must have an opportunity to succeed. They did not, however, guarantee equal results. And giving preference to one group of citizens over another seems on its face contrary to the notion of equal opportunity.
  Mr. Chairman we must ensure that each employee and customer of the Department of Agriculture be treated fairly and equitably, and with dignity and respect.
   The Civil Rights Action Team must address the institutional and underlying problems at the Department of Agriculture. And when a problem exists at the Department of Agriculture, there must be accountability and follow-through.
  I look forward to hearing from Secretary Glickman and Representatives Waters and Conyers regarding their thoughts on the progress of the Civil Rights Action Team Report
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  Secretary Glickman, thank you for your testimony here today. I want to applaud you and your efforts to root out the evils of discrimination at the U.S. Department of Agriculture. There is no place for discrimination anywhere in our society, but it is especially dangerous in our public institutions.
  Discriminiation in our Government agencies threatens the credibility of everything we do as public servants whether as Members of Congress or as hard working, honest Government employees. Without the trust of all of the public, our public institutions cannot function effectively. Again, thank you for taking decisive action to combat racism and discrimination at the Department of Agriculture. The Department and the is committee, along with the rest of Congress, has a long way to go in eradicating discrimination in hiring and program administration within the USDA. However, with your leadership, I know we can get the job done.
  "The Official Committee record contains additional material here."

  The CHAIRMAN. Now, Mr. Secretary.
  Secretary GLICKMAN. Thank you very much.
  First of all, I want to introduce who is with me here. On my right is my partner, the Deputy Secretary, Rich Rominger. And on my left is Pearlie Reed. Pearlie is the head of our Civil Rights Action Team. Pearlie was Associate Chief of the Natural Resources Conservation Service when I asked him to take this job around the first of the year, to begin to focus our attention on civil rights.
  So Pearlie is now Acting Assistant Secretary for Administration and he has been our savior coming in and doing his best to clean up a problem that has existed for a very long time. A very difficult problem. One that has caused me, in terms of my personal time as well as attention and focus, more than any other issue the Department of Agriculture, and one that frankly we have barely scratched the surface on. And so it is, this is an important topic.
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  I served with you for many years, 18 years, I don't think this topic was ever discussed at a formal hearing, so I commend you for having this hearing. Abraham Lincoln called USDA ''the people's department,'' when he created this department in 1862. We are working hard to restore the full lustre of that name.
  I'd like in particular to thank those on this committee and elsewhere who have shown a deep, personal commitment to and involvement in the civil rights struggle at USDA. The support of Congress, and in particular, this committee will be crucial to the progress we make. And I would tell you right now, we need your help and your support and your involvement to work through this particular issue.
  It was a little over 2 years ago when I appeared before this committee to first talk about my plans for USDA. We talked about wheat and cattle, crop insurance, research, conservation. We talked about Kansas and California, just two States that Mr. Rominger and I care about. We did not focus on civil rights. Quite honestly if there was one ambush awaiting me in this job, that's it.
  Today I spend as much, if not more, of my time dealing with civil rights matters as I do any specific farm program. And the reason is simple enough. We have a long history of both discrimination and perceptions of unfairness that go literally back to the middle of the 19th century. For those who look back on the progress made in the 1960s of the historic civil rights laws passed in that time and think we got the job done, I can say just from my experiences at USDA, we do not yet fully practice what we preach.
  I've talked to people who have lost their farm. Good people, who lost their family land not because of a bad crop, not because of a flood, but because of the color of their skin. I've talked to employees—dedicated public servants—who have been humiliated, abused and then punished for speaking up. I want to close this chapter of USDA's history. My goal is to get USDA out from under the past and have it emerge in the 21st century as the Federal civil rights leader.
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  The American farmer and the American people deserve nothing else. I appear before you today proud of the progress we have made in calling attention to the problem of starting to focus ourselves on solutions and getting key changes quickly in place. But I also appear before you today having undergone a reality check as to the massive amount of time, resources, people, power and leadership, both at USDA and in Congress, that it is going to take to get the job done right.
  This is an extraordinarily complicated problem that has taken decades and decades and decades to build to this situation. So we are committed to resolving, but we do need your help as well. I also want to emphasize the overwhelming majority of our employees are committed to treating their co-workers and customers with dignity and respect. The institutional and personnel problems which continue to afflict the Department, should not demean the majority of our committed and capable staff.
  By and large, USDA employees are dedicated, fair-minded, overworked and under paid.
  Like discrimination in many of America's public and private institutions, civil rights problems at USDA are not going to disappear overnight. If there were easy solutions, I would assure you we would not be sitting here today. But the fact is, there is no silver bullet. We are going to have to get through this the old fashioned way, with our sleeves rolled up and a whole lot of people doing a whole lot of work.
  And our efforts are already well underway. As most of you know, it's been 5 months since the release of USDA's Civil Rights Action Team Report. And by the way, that process got started around Christmas, and within a record 60-day time period, it was finished. We had 12 listening sessions around the country to hear from farmers, ranchers, employees, rural residents and community leaders.
  Our report listed 92 specific recommendations to improve the civil rights climate at USDA. To carry them out, we have organized 33 implementation teams, involving approximately 300 people, currently employees at USDA. Together they have logged tens of thousands of hours of work. We have a long way to go, but we have started down the road to a solution.
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  And I want to give you a progress report. Where progress could be made on my authority, we have moved quickly. I have made it a condition of employment, that every employee treat every coworker and customer fairly and equitably with dignity and respect. No exceptions, no excuses. We have a new foreclosure policy. Now when a written civil rights complaint is lodged, the foreclosure is frozen wherever it is in the process until an independent review occurs and a judgement is made as to whether or not discrimination occurred.
  We have a zero tolerance policy for reprisals against employees who file civil rights complaints. From now on, a three person panel made up of one union or an employee representative, one manager or a personnel staff and one mediator will investigate alleged reprisals and make binding recommendations.
  I've also ordered that loan processing continue on accounts where a discrimination complaint is pending. Standing up for your rights should not disqualify someone from seeking a farm loan. If it is the loan processor facing the allegations, then another FSA, Farm Service Agency loan officer will be assigned to work with the applicant. If that loan cannot be approved, they get a meeting and a written letter of explanation. That last part helps clear up the problem and the perceptions.
  Without question, part of the problem is economic. Smaller farmers of all ethnic backgrounds and all regions of the country are having an increasingly difficult time coping with the massive changes that are occurring in the structure of the Agriculture. Yesterday I announced the formation of a National Commission on Small Farms.
  It will be headed by a former member of this committee, Harold Volkmer of Missouri. His commission will talk to folks around the country and pull together the thread of rural and economic conditions that affect America's small farms, and weave a national strategy to make our small farms as powerful a force in agriculture's future as they have been in the past.
  I've asked their report be presented to me by September 30 and I look forward to sharing it with all of you and taking bold steps in that area as well.
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  Under the economic rubric, we will also propose legislation to modify certain provisions of the 1996 farm bill. We have worked very closely with Congresswoman Clayton and others to provide more flexibility in terms of assisting farmers who rely on USDA for farm operating credit. In my book, the 1996 farm bill went too far in restricting credit, particularly to those farmers who received a debt forgiveness and were denied an opportunity to work their way back to qualifying for assistance. That's even harsher than commercial credit standards and needs to be corrected.
  USDA will also soon have an Office of Outreach, which may be the most visible evidence that we are serious about reaching out to customer whom we've neglected in the past. All our potential customers should get the information they need to use our programs and services. We also expect to soon fill the newly created position of Associate General Counsel for Civil Rights. This person will head a staff of attorneys who will be dedicated exclusively to the performance of civil rights functions.
  These are just the highlights of what we have done to date, and they accomplish perhaps a third of the recommendations that were made in the report. You should all have a more complete accounting in the package of material that my staff has handed over to this committee. But I mentioned earlier a reality check. Nowhere has it been more abrupt than in our efforts to resolve the backlog of nearly 2,300 civil rights complaints, 1,500 from employees and nearly 800 in our farm and rural development and other programs.
  Some of them go back years. This shows the rift between civil rights and civil realities. I don't have to explain to anyone on this committee what's likely to happen to a small farmer who's denied a timely loan. Or the employee who has filed a complaint against his or her boss and then has to wait year after year for closure. I am not proud of our history. I must tell you that. I am not proud of our history, our institutional dedication, or commitment or our internal operations in the past 15 years in resolving these complaints. And that even includes time that I have been in this job.
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  Our organizational structure and institutional commitment to resolving program and personnel complaints have left a great deal to be desired. And quite frankly, neither past administrations nor past Congresses, including when I was in this body, devoted very much time to this issue at all. I do believe this is the first time in the modern history of Congress, that this committee on either side has held a hearing on this subject. And for that, you should be commended.
  Since the Civil Rights Action Team Report, we have focused huge amounts of time and resources on resolving those complaints. We have settled 215 cases of alleged discrimination against employees and closed 89 cases on the program side. Of that 89, four cases involved what I would characterize as significant settlements, adding up to a total, the four cases, of more than $2 million.
  USDA stands ready to resolve quickly and fairly, legitimate civil rights complaints. And I stress the word legitimate, because we have an obligation to taxpayers to ensure the charges are warranted. We cannot simply settle for settlement's sake. We must investigate each charge. This is where we have hit the proverbial brick wall. A good part of the reason for the backlog is the fact that in 1983, USDA Civil Rights Investigation Unit was dismantled. We are just now in the process of hiring back those positions.
  Currently, we are using contract investigators to help us sort through the backlog. We expect that a permanent staff will help us break up the logjam, but this will remain a lengthy, arduous process that is likely to take a year to wrap up responsibly. And I should mention, with me is Lloyd Wright who is the new head of our Office of Civil Rights.
  Since Mr. Reed came on board, we have virtually an entire new team involved in the administration of these particular matters, and it's his job to break through this backlog and get it done responsibly. Once we get back to ground zero, we are working on ways to move the process along at a quick but fair clip, that allows all parties to move on with their lives.
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  So I would say that this leads me to perhaps my last issue, and that is the issue of building accountability. We don't just want to fix what's wrong, we want to build an institution that consistently does what's right. That requires building more accountability into the system. In this area in particular, we are going to need to work very closely with this committee. We need to send a strong signal throughout our ranks that USDA is serious about institutionalizing proper civil rights enforcement up and down our ranks.
  I've given Mr. Reed the authority to rate agency heads on their civil rights performance. It will no longer be a second tier consideration. We are also working to ensure that our civil rights objectives are incorporated into our performance management system, so that managers know what's expected of them and understand that they will be rated based on how well they live up to those expectations.
  Finally, there is the question of the USDA structure which serves agriculture outside of Washington, the field structure. As an 18 year member of this body, from the great agricultural State of Kansas, I am under no delusions as to the political degree of difficulty of any legislative proposal to convert county employees to Federal employees. While this change was suggested in our Civil Rights Report, its origin is almost entirely based on general management concerns.
  Our county field structure is far from resembling a Fortune 500 corporation. But as we downsize and streamline and all the rest that we have to do, I think a brief comparison is worthwhile. Right now we operate under two personnel systems in our counties. A system of county-based employees and Federal employees, often in the same offices, all whose salaries are paid for by the Federal Government, Uncle Sam.
  It wasn't even until about 10 years ago that I realized that county employees were paid by the taxpayers of the America just as Federal employees were paid by the taxpayers of America. They are all paid by the same people. In the same county office, we find both Federal and non-Federal employees all doing USDA work, side by side, but they do not technically have the same boss.
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  This is something that you would be hard pressed to find in the private sector, because it is that dreaded management consulting word, inefficient. Now what does that mean? We had a county committee, they are a grass roots connection and bring to the table hands-on farmers' knowledge of how Federal policies actually work. These men and women are like the Board of Directors. They care about the big picture, getting their rural communities and farmers the Federal resources they need. Seeing Federal conservation policies, rural development efforts and farm programs work in their county.
  Their role in substantive policy and program matters would not be affected by this shift at all. This proposal will simply take the next logical step. It will recognize all the changes that are occurring. It will close the accountability gap on civil rights and it will create a more efficient and much less costly field structure where everyone does what they do best.
  County committees will be free to focus on the big picture, the program picture. And nuts and bolts personnel management will be carried out according to one national standard. Again, all these people are paid by the same people. They are all nationally taxpayer paid people. This will help create a more positive, consistent work environment for our field staff and a higher standard of service for all our customers.
  Done right, it will also eventually save us the thousands of hours and millions of dollars we are putting out right now on the damages side of civil rights enforcement. I understand that the nature of a bureaucracy is to resist change. I understand too, that for decades this has been an untouchable issue and probably rightly so for the times. But today I am utterly convinced that we can do this the right way, and I am equally convinced that this is simply the right thing to do.
  Our employees out on the front lines of this whole civil rights effort liken their work to trying to turn an elephant around using a pin. We are dealing with a large Federal bureaucracy. One that is scattered across almost every county in this country. We were the first decentralized government in this country. The Agriculture Department was set up and it was—the programs in the thirties were set up basically to run in a decentralized way, with a national set of policies. So we are located everywhere.
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  We are also dealing with civil rights, which involves laws and policies, but also people's hearts and minds. Some things change faster than others. It is not hard to draw the comparison to the President's ''One American Initiative.'' On the one hand, racially healing is such a vast and squishy issue that few people have any real concrete ideas on where to begin. On the other hand, discrimination runs so completely counter to everything we stand for as a Nation, that the alternative, which is to do nothing, would be unthinkable.
  Today President Clinton is talking to the NAACP and the National Association of Black Journalists about our options as a Nation. I am here talking to all of you. I have every confidence that these actions, if embraced by this Congress, will be extraordinarily positive for the Department of Agriculture. We, at USDA, are special in our advocacy for America's farmers and ranchers. These changes will make us even more effective.
  We cannot change how every person treats every other person, but we can demand a basic respect for the human rights and dignity of our customers and employees. If we do, we will strengthen the people's Department and dramatically improve our ability to serve agriculture and the Nation.
  Thank you, Mr. Chairman.
  [The prepared statement of Secretary Glickman appears at the conclusion of the hearing.]
  The CHAIRMAN. I thank you, Mr. Secretary, for an excellent statement. Does the Deputy Secretary or Mr. Reed have comments?
  [No response.]
  The CHAIRMAN. Not at this time. And they are available for questions. Thank you. I have several questions, but I would like to send them down to the Department. That will save some time for the rest of the committee members who have been patient to answer some of their questions.
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  At this point, I recognize Mr. Stenholm of Texas.
  Mr. STENHOLM. Mr. Secretary, I know that Mrs. Clayton has developed a bill with a number of provisions stemming from the Civil Rights Action Team Report and I look forward to working with her on that package. But I was wondering when we might be expecting a formal, legislative package with the eight or nine recommendations that now appear to need Congressional action?
  Secretary GLICKMAN. Well, we have been working with Congresswoman Clayton, and based upon the early drafts, we support most of the provisions in the bill that we have seen. So it is my expectation that you will probably be hearing our position, as it relates to Congresswoman Clayton's bill.
  Let me tell you a little bit. We're going through close-out sessions of the Civil Rights Action Team Report. There were 92 recommendations, many of them involve legislative recommendations. So we have the implementation teams that I have been working with, since this is a grass roots effort and I need to complete that process before I finish a final decision on everyone of the legislative packages.
  But working with her, I think that we have reached agreement on most of what she has prepared to date.
  Mr. STENHOLM. In previous discussions with committee staff, Mr. Wright indicated he thought he had the necessary resources at this point to work through the tremendous backlog of discrimination complaints pending at the Department. Is this still the case?
  Secretary GLICKMAN. I would ask Mr. Reed or Mr. Wright to comment on that and then I will comment after they finish.
  Mr. REED. Right now we feel that as we staff up the Investigation Unit, we will probably need somewhere in the neighborhood of 2 to 3 million dollars more than the current level that's provided in the appropriations for 1997, for this activity.
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  Mr. STENHOLM. Mr. Chairman, I too have some additional questions and in the interest of time and fairness to other members of the committee, I would defer to those and submit the rest in writing.
  The CHAIRMAN. Without objection, I thank the gentleman. The chairman of the Subcommittee on Department Operations, Nutrition, and Foreign Agriculture is, of course, here with us today. Mr. Goodlatte of Virginia held a hearing on this subject on March 19 and I recognize him now for any questions.
  Mr. GOODLATTE. Thank you, Mr. Chairman. And Mr. Secretary, welcome. We are very delighted to have you with us today.
   Mr. Secretary, I would like to commend you for the efforts that you have made in this regard. You have come up with a massive number of recommendations, not all of which I and some of the other members of this committee agree with. But nonetheless, they are all substantive efforts to deal with a very serious problem and one that none of us should attempt to duck and this committee certainly has not done so. And we are going to continue to work with the Department on those aspects of those recommendations that require some legislative action and I expect we will continue to hold additional hearings on that in the future.
  And this is something that we truly want to, as you say, close the book on. Not on having the mechanism in the future to deal with those problems that arise, but to end what is a taint, obviously, on the U.S. Government and on the Department of Agriculture for having a situation where we do have a number of documented cases of race discrimination that is entirely unacceptable and inappropriate.
  And I wonder if you might comment on the scope of that and the extent of that in terms of whether you find this to be localized in a few areas, several areas, or whether you think it permeates the entire Department.
  Secretary GLICKMAN. Well, I don't think it permeates the entire Department.
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  Mr. GOODLATTE. Good, I don't either.
  Secretary GLICKMAN. And I've said that before. I think the majority of our people are fine human beings, doing the best they can, working extremely hard. I do think that there are regions of the country where it's more severe than others. I think that all you had to do was to go to these field hearings and the Deputy and I were all over the country.
  And what we saw were extensive amount of cases. A lot of our hearings were in the South, but we also went into Native American country. We did these nationally and there is no question that there is a pretty good evidence of a pattern that exists in certain parts of the country, with certain people. And it is accelerated by the fact that smaller farmers have had difficulty coping anyway, given the changes in agriculture.
  What we have to do is to target that conduct. Find it, root it out and do our best to compensate the people who have been aggrieved in accordance with the law. And it's tricky, because we're everywhere. You know, we were set up to be everywhere in America. We were a decentralized operation. There weren't a lot of national management controls. That's the way, frankly, the Congress and the President wanted it at that time. But it has led to uneven enforcement of civil rights in this Department.
  Mr. GOODLATTE. I noted in your statement that you said that in reviewing these cases on a case-by-case basis, which obviously has to be done. And in attempting to do justice to those who'd been wronged in their dealings with the Department, that you obviously have as your highest priority to be fair to them. But you also noted that you have an obligation to the taxpayers, I think your words were, obligation to the taxpayers to be sure that the charges are warranted, which is definitely the case.
  We don't want to set up a system where people are compensated because of economic misfortune or things that are not related to clear cut cases of race discrimination. Because as you note, small farmers of all backgrounds are facing some tough times. My question goes beyond that, however, to the issue of are you, in addition to making sure that the case are warranted, making sure that the settlements that you are accepting or proposing or allowing are warranted.
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  Because there have been some reports coming back here of settlements that seem, in some instances, to perhaps be excessive in the sense that we are recognizing that somebody was wrong in a particular situation, there is in many instances, a clear way of determining a good of what the amount of the loss is, and then there seems to be a larger, a considerably larger amount of money that is paid out. I wonder if you might comment on what processes you go through in dealing with that. You've settled four?
  Secretary GLICKMAN. We've settled four of the major—there has been other settlements—but there have been four of the large settlements. And let me just say that I've delegated the settlement authority to Mr. Reed, and he and Mr. Wright, since Mr. Wright is the head of the Office of Civil Rights, is the person most involved in dealing with these settlements.
  And they have been instructed to do, to act with justice but also act in accordance with the law. And perhaps Mr. Reed or Mr. Wright may want to comment on the settlement process.
  Mr. REED. Lloyd, why don't you come on up and do that.
  Mr. WRIGHT. Thanks. This week we will start to hire some employees. Two of the employees we will hire will be economists and that we intend, once we go through the findings and find that there has been discrimination, to have our technical people go through, and using acceptable economic procedures, determine to what extent farmers have been damaged.
  We will use those numbers, plus any compensatory damages that are warranted, and a combination of those two will make up the settlement. So we intend to have a process that we think will be highly defensible that we will use in the future for settling complaints.
  The CHAIRMAN. The gentleman's time has expired.
  There will be another round. I thank you, gentlemen. I might announce as well that there will be another panel. Congresswoman Waters and Congressman Conyers will be a part of that panel. The Chair recognizes Mrs. Clayton.
  Mrs. CLAYTON. Thank you, Mr. Chairman. I want to thank the Chair for having this hearing. I think Secretary Glickman noted correctly that in the history of this committee, this is the first hearing ever that we have had on discrimination. However, this isn't the first document we've had on it, because I think the Civil Rights Commissioner who Representative Chenoweth just submitted, had a report in 1982, and you will hear later that there have been subsequent reports.
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  So I want to commend him for having this hearing. I also wanted to just say, parenthetically, I hope that the day will go down in history as the beginning of the process by which we are actually making a change, and not just doing another exercise to provide a record. But this is a beginning of a process to find a way which we can actually make a change in that.
   Senator Robb had wanted to participate and I regret that he didn't have the opportunity, inasmuch as not many of us came here, he thought it was going to be crowded. But I ask, Mr. Chairman, unanimous consent to enter his testimony in the record.
  The CHAIRMAN. Without objection, so ordered.
  Mrs. CLAYTON. Thank you, Mr. Chairman.
  [The prepared statement of Senator Robb appears at the conclusion of the hearing.]
  Mrs. CLAYTON. Mr. Secretary, in your statement you said that trying to change things at USDA is like trying to turn an elephant using a pin. I have my own elephant comparison. There is an old proverb that states, ''When elephants fight, the grass gets trampled.'' The grass in this instance are the socially disadvantaged farmers. They have been trampled, not because of anything they did or did not do, they have been trampled because of who they are.
  How soon, Mr. Secretary, do you think relief will come for these people who are the victims of this?
  Secretary GLICKMAN. Mrs. Clayton, I am also aware of an old expression, it doesn't have to do with elephants. It goes like this, ''After all has been said and done, there is a lot more said than done.''
  And I don't want that to be my legacy on this issue.
  Mrs. CLAYTON. That's why I asked the question.
  Secretary GLICKMAN. We are exercising full dispatch to have the people power and the organizational structure to get both the management changes, as well as the backlog resolved. As I said before, since 1983, up until now, we haven't had investigators to even investigate the cases that have been in the pipeline.
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  So the organizational structure of dealing with these problems has been rather dysfunctional. We believe that we are going to change that and I know that. Perhaps Mr. Reed may have some comments, or Mr. Wright, in terms of the resolution of cases. We are moving the cases as quickly as possible. But more than that, we're trying to make sure that our programs and our resources are allocated in the appropriate and fair way, so that everybody in this country can participate in them.
  And it is a long, slow road, but we are going to do it as fast as we can. With your help, too.
  Mrs. CLAYTON. Again, Mr. Secretary, as you know in introducing the USDA accountability act that I'm doing today, it has provisions to make sure that all, as you have so eloquently stated, that we need to find a system where everybody is adhering to that standard and then hold people accountable to that standard. Hopefully, that accountability will make sure that people are not only treating their customers well, but also their employees well.
  Have you looked at that? I know you are not prepared to say in all those instances, but I just want to say the accountability is one part. The other part is indeed to provide resources to make some corrections for the forgiveness of debt as it relates to the 1996 bill.
  Secretary GLICKMAN. Yes.
  Mrs. CLAYTON. It also provides for an opportunity to have outreach and some new resources to enable that. Have you looked at that?
  Secretary GLICKMAN. I haven't seen this specific bill you've dropped in. I saw the draft that you did, as you know, we endorsed many, if not most, of the provisions, including the debt forgiveness provisions of the 1996 farm bill, as well as some of the additional resources. I will get you a formal statement within a week. But as I said, most of the provisions we support.
  Mrs. CLAYTON. Mr. Secretary, inasmuch as there was no procedure before you started your new procedure, in fact, there was probably a general deception, whether it was intentional or not, people thought there was in place a structure to handle complaints. But in fact, there was no structure.
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  So people were actually making complaints in good faith, thinking there was a system in place to deal with their loan. Is it possible that you can begin to understand how that might have disadvantaged hundreds of individuals and the Department itself, which I am ashamed to say, perpetrated this wrong on these people. I mean, as much as I think the Agriculture has helped, it has been, the Government, should I say, has been a part of perpetrating that deception.
  Is it conceivable that we can find a way to structure a forgiveness in a class action. This has been done before. We have had downturns in agriculture and I remember in the early 1980s where there was great down turning, that we found a way through our farm credit to do that. And generally, this Government has found ways where any part of its sector has been severely disadvantaged, they have tried to intervene.
  I think this situation warrants that for these people who have been suffering this number of years.
  Secretary GLICKMAN. First of all, let me say that it is disgraceful that we have handled complaints the way we've handled them over the last several years. That's all I can say. From management perspective and from policy perspective, that the organization was so disorganized, and I use the word dysfunctional.
  I don't think it was evil intent, but I am not going to subscribe motives to it. It was just dysfunctional in terms of organization and we are going to do our best to start making sure that there is regular order to the process. Because as you implied, justice delayed is justice denied. And people didn't know what was happening to the complaints that they had filed, whether they were valid or not valid complaints.
  And not all the complaints are valid, I want to make that point. There are some complaints that ought not to be accepted at all. But there needed to be some attention to them so that people could be told, yes or no, you've got a claim or you don't have a claim. Now a class action issue is probably one that's going to have to be dealt with legislatively.
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  We have class actions against us filed now, the Forest Service was mentioned and there is a class action against us filed by Forest Service employees and other kinds of things. I do not think that we have the legal authority to deal with a group as a class, however. I think that would require either statute or legislative authority that's not otherwise there.
  There may be people who have grounds under the current law to file a class action, but I can't speak to that.
  The CHAIRMAN. The gentlelady's time has expired.
  Mrs. CLAYTON. I understand, I will respect that.
  The CHAIRMAN. We will try to come back for a second round. Mr. Canady.
  Mr. CANADY. Thank you, Mr. Chairman. Mr. Secretary, I appreciate your testimony. One element I want to focus on, which was referred to in Mrs. Clayton questioning, is the statement you make about outreach. I am interested in the sort of components that you have in mind for the outreach effort, because I think that's very important.
  I think that, we may have some disagreements about certain aspects of your plans for dealing with these problems, but I think that is an element that we will find a great deal of agreement on. I would be interested in hearing the elements that you have in mind for that program.
  Secretary GLICKMAN. Well, I am going to ask Mr. Reed, perhaps, to comment on that. Let me say, for the record however, and we have a completely new team, this is a different team that we had 2 years ago, 5 years ago, 10 years ago. And you know, I am not going to disparage anybody personally because the buck stops with me. I, myself, was responsible for things that go on in the Department.
  But there is a new group of people from Mr. Reed's level to Mr. Wright's level to a whole litany of other people who have come in to try to deal with this problem in an effective, fair, compassionate way and doing it in accordance with the responsibility that we are spending taxpayer's money as well. Mr. Reed, do you have any comments?
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  Mr. CANADY. If you could, I don't want to use my whole 5 minutes on just one question, so if we could try to get the short answer.
  Secretary GLICKMAN. OK. He gives short answers.
  Mr. REED. We are in the process of establishing an Office of Outreach and let me commit to following up with you with a complete package on that that spells out everything in detail. But basically, we are going to transfer the 2,501, Small Farm Outreach Program, into that Outreach Division, along with all of the national outreach efforts that the Secretary feels he needs to have close to him, so that we can ensure that throughout USDA, all of the mission areas have an effective outreach program.
  Secretary GLICKMAN. Let me give you one quick example, conservation. What we have found overall is that the small farmers, limited resource farmers do not participate in a variety of our technical assistance conservation programs, repairing and buffer changes, you know, E.Q.U.I.P. program which is now a replacement for something else, almost at all.
  Why is that? You know, I mean these are the kinds of things that we need to get information to people. After all, we have a lot of programs that can be useful to people. And for whatever reason, that communication is not occurring the way it should.
  Mr. CANADY. Well I think that is a very fruitful line of attack on the problems that exist and I'll be interested in seeing the more specific elements of the proposal that you will provide. Let me focus on another aspect of your testimony. In your testimony, Mr. Secretary, you indicate that you've given Mr. Reed the authority to rate agency heads on their civil rights performance.
  You also say, we are also working to ensure that our civil rights objectives are incorporated into our performance management system. In the Civil Rights Implementation Team Report that we have with the 92 recommendations, I would just bring to your attention recommendation No. 4, which says, the Secretary should revise and reissue USDA Civil Rights Policy to include specific measurable goals and objectives in program delivery and employment that will provide guidance for senior officials of what they are expected to accomplish.
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  Do you agree with this specific recommendation of the Civil Rights Implementation Team?
  Secretary GLICKMAN. Well, first of all, let me make it clear that all the recommendations as implemented will fully comply with all Federal laws and all Supreme Court decisions. So that I want to make it clear, if that's where your question is heading.
  Mr. CANADY. In connection with that, would you then anticipate that in implementing that provision as well as the provisions that are in recommendation No. 28, where we talk about a baseline for the number of minority farms and setting goals to halt land loss and to monitor the loss of minority owned farms. And in recommendation No. 48, which says, require that a higher percentage of farm ownership and farm operating direct loan funding be targeted to minorities and socially disadvantaged groups.
  With the implementation of those recommendations and other similar recommendations, would you anticipate applying different standards to individuals taking their race into account? So that one set of standards would be applied to people of one race, and another set of standards would be applied to people of a different race?
  Secretary GLICKMAN. No, no.
  Mr. CANADY. Do you anticipate establishing, through that system, any sort of proportional representation standard so that you would have a policy of saying a certain percentage of loans will go to people in a particular group and so on?
  Secretary GLICKMAN. No. The Ataran Decision would make that illegal. We could not do that. I think what we can do is in the outreach part of our operation, we can do a better job of ensuring that more people who fit the category of limited resource or socially disadvantaged become aware of our programs, encouraged to participate in our programs and become a part of our programs. That's our job to do that thing, but we are not setting any quotas or anything like that as a part of this.
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  Mr. CANADY. Well, I appreciate that comment and I agree with your outreach efforts. I appreciate your response, thank you.
  The CHAIRMAN. The gentleman's time has expired. Mr. Thompson.
  Mr. THOMPSON. Thank you, Mr. Chairman. Let me complement the Secretary and his staff for giving what I consider a yeoman's effort to this big problem. A reference was made earlier to practice what you preach. And I can't really sit here any longer and not at least go on the record when I hear us talking about civil rights, to indicate that on our staff, for the minority on this committee, it is all white.
  So we have not even recognized on this committee that black people——
  The CHAIRMAN. Pardon me, Mr. Thompson, let me interrupt. And I know many of you are involved and emotional about this issue. Please, we do not allow utterance from those people who are invited here. So, despite what you may feel about the issue, please contain yourselves and we'll continue. Mr. Thompson.
  Mr. THOMPSON. Thank you. And I hope at some point that this committee will recognize the worth and dignity of African-Americans too, and we can too begin the process of employment and indeed making this a color blind society.
  Mr. Secretary, to what extent has the Office of General Counsel cooperated with you in the implementation of this Civil Rights Action Team Report?
  Secretary GLICKMAN. It sounds like a leading question. Let me say that we have got to have all parts of our team working together in order to get the report implemented. And I am well aware that there have been some frustrations exhibited in the process, especially with the very deeply held feelings and the personalities involved.
  Has everybody cooperated perfectly? The answer is no. But my belief, Congressman Thompson, is that the commitment is there on behalf of that office as well as the other mission areas to get the work done. That's the best I can tell you right now.
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  Mr. THOMPSON. So do I interpret that to mean that whatever it takes to get the job done, you are committed to——
  Secretary GLICKMAN. That's correct.
  Mr. THOMPSON [continuing]. To doing that? Despite the Office of General Counsel's objections?
  Secretary GLICKMAN. Well, I don't want to personalize the debate. I would say this, that there are a lot of changes happening at USDA and a lot of the different mission areas have different roles in this process. But we are committed working together as a team and I recognize that at times there may be squabbles between parts of the team.
  But they have to work together. That's just the rule that we've set down.
  Mr. THOMPSON. OK, well, good luck. Let me move to another level. I'm told that in the process of people filing discrimination complaints against the agency and individuals, that your office has never disciplined an individual for discriminating against a farmer. And I say your office in terms of the U.S. Department of Agriculture.
  How is it that we can have employees in this agency discriminating against people who have been found to have been discriminated, yet in any settlement agreements, they are held harmless in terms of any penalties?
  Secretary GLICKMAN. I think your premise is basically correct. I think to the best of my knowledge, at least in recent years, there probably has not been any disciplinary action taken against employees who have been found to have discriminated. That is the purpose of the policy changes to make sure that that begins to change.
  I don't know, Mr. Reed, do you have any further comments on that?
  Mr. REED. Yes. We do have several recommendations in the report, Mr. Thompson, that will establish the framework for us to followup in the system and hold individuals accountable for their actions.
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  Mr. THOMPSON. The process of solving the cases, when you say a case is closed, Mr. Secretary, explain that to me?
  Secretary GLICKMAN. Perhaps Mr. Wright may want to explain that.
  Mr. WRIGHT. We investigate cases. We analyze the findings, and I said we are going to start to investigate cases. We have not in the past, but starting now we will. We will determine whether or not we have adequate information to support a finding of discrimination or no discrimination.
  We will issue a decision. If we issue a decision of no finding, that case will be closed and unless new evidence is presented to us, we will not further deal with that case. So it will be closed and done with in terms of discrimination or any kind of award to the farmer.
  If we find discrimination, we will work out, using the process that I just mentioned, we will have the technical people determine the actual losses based on information submitted by the farmer, and then we will work out an agreement, hopefully, to withdraw all complaints. But the final decision that goes out will close that case as well.
  And we normally ask that the person agree not to file civil action later. In which case that would be a closed case and we would never again expect to deal with those issues again administratively.
  Secretary GLICKMAN. There have been cases closed this year you should be aware of. They have either been closed through alternative dispute resolution. There have been employment complaints, over a couple hundred, that have been closed just by working an ADR process through where there has been some resolution.
  It might involve moving a person somewhere, it might involve damages, I'm not sure what, and the cases have been resolved and closed. There also have been some program complaints closed, 87 program complaints, actually more than that, about 139 program complaints have been closed. I'm not aware of what exactly has happened, but there has been some resolution through arbitration or whatever to get them resolved.
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  The CHAIRMAN. The gentleman's time has expired and we will try to get back for a second round, Mr. Thompson. Mr. Bryant.
  Mr. BRYANT. Thank you, Mr. Chairman. Let me also add my thank you to the Chair for convening these hearings, and I think anytime you can shed light on an issue it advances the cause. Mr. Secretary, welcome.
  Secretary GLICKMAN. Thank you.
  Mr. BRYANT. And it is always a pleasure to have you here. You have always been very open, very candid, very available to us and I appreciate very much your sincerity and your effort in this area. I think what has already begun here followup, I think, I know in my area I probably have less concern towards what goes on in Washington at USDA as opposed to what goes on in my district.
  I have a fairly agricultural district, 15 counties of varying degrees of farming and I know that as we have looked into this, there have certainly been allegations, legitimate in terms of the Farmers Home Administration. And of course we all know they have been moved over to the FSA and to some extent we are talking about the sins of the past being visited upon the current operation, primarily the FSA.
  In realizing that there is a different process in place now, and I think a much more appropriate, fairer process and including the membership on the Boards of Directors of the FSA offices in instances in, and correct me if I'm wrong, but I understand if there is more than a five percent minority number of farmers in a county that automatically entitles one minority advisory member to the FSA Board.
  Secretary GLICKMAN. It's a non-voting member.
  Mr. BRYANT. And that's a step, certainly, in the right direction and statistically, I didn't know this, but eight of the 15 counties I represent have that minority advisory member already. And I also want to commend, as I listened to your testimony and follow along its writing, your appointing the National Commission on Small Farms. I understand you are shooting for the 30th of September to have a report in.
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  I think that's important as we move to reform agriculture and we are in transition, I think we have to remember the small farmer. And I really look forward to that report. In connection with that, I want to just confirm with you, I think your answer you have consistently given my office and this committee in terms of closures and consolidations of some of these offices which we all agree is necessary, that the recent, in the last few days, disclosure that it will be necessary to downsize in numbers of workers, that when you say offices will not be closed, that you are saying that offices will be open with sufficient numbers of workers who can adequately service the customers?
  Secretary GLICKMAN. I might ask the Deputy Secretary to respond. There are two parts to this thing. No. 1 with the amount of money that we think is in both the House and Senate appropriations bills, we think we can operate without any further closures from what we had previously announced earlier. There still are a few to go, that haven't been done, but no new major numbers of closures next year.
  Beyond that, I can't give you any promises and I committed that we would keep in touch with you on this particular issue. On the other issue, I would have to tell you, we haven't really talked about this and we, I have instructed my mission areas to prepare a plan for administrative convergence so that we can consolidate the administrative operations of the field structure from headquarters down. So that you don't have three Xerox machines in a county office that is being served by NRCS, FSA, Rural Development, three personnel officers, three vehicle officers, you know, that kind of thing.
  We have instructed them to prepare a plan, which I will have within a couple of months. And that plan will probably mean some reduction in administrative staff, but that will not affect the county office closing. I want the Deputy to help me out just to make sure.
  Mr. BRYANT. Because I am also concerned that, even though the office is open, that it would still have enough people there to serve the customers.
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  Secretary GLICKMAN. Yes. Well, and I might tell you, it may be tight in some places. You know, that's one of the reasons why the folks who are planning say that you got to have enough people in the office to be able to help producers out there. But we will do the best we can. The Deputy just may have some comment on that.
  Mr. ROMINGER. With the funds that are in the 1998 budget proposal, we believe we can keep those offices open. But it will mean that there will be fewer people out in the counties and that's why we are moving to consolidate in the administrative area, so that we can have the people that are administering these programs, still there to do the program work.
  The CHAIRMAN. The gentleman's time has expired.
  Mr. BRYANT. Thank you.
  The CHAIRMAN. I thank the gentleman. Mr. Goode.
  Mr. GOODE. Thank you, Mr. Chairman. I want to thank you for holding this hearing and also thanks to the Secretary and his staff for being here. Really, I just have one general question. I read your statement and what you said about progress to date. Maybe you could give a few specific bullets of general things that you think will occur in the future to focus on this situation and to help it?
  Secretary GLICKMAN. Well, one thing we have to do is faster resolution of complaints that are backlogged. As Mr. Wright mentioned, up until now we haven't even had any investigators on staff. We are probably the only Federal agency in Government that doesn't have this on a regular basis. So that's the biggest bullet we can do, is to resolve existing complaints fairly, but also keeping in mind the taxpayer's dollars are involved here as well.
  We also need to ensure, we talked about this outreach. We have to do a much better job of communicating with farmers, particularly smaller and limited resource farmers. The programs are available to them that they can utilize. And that, particularly for example, we found Native American farmers who have not participated in a lot of these particular programs, so that is another area that we are very much involved in that we are pressing ahead.
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  And there are just a whole litany of management changes that are happening at the Department itself which are probably too numerous to mention. What else do you have there, Pearlie?
  Mr. REED. The only other thing I would add would be the accountability factor. We have, again, several recommendations that will establish the framework so that the Secretary can hold his subcabinet and agency heads accountable, and that has been missing in the past.
  Mr. GOODE. That's things you will do in-house.
  Secretary GLICKMAN. That's correct.
  The CHAIRMAN. I thank the gentleman. Mr. Hilliard.
  Mr. HILLIARD. Thank you very much, Mr. Chairman. Mr. Chairman, the first question I would like to ask the Secretary is would you explain for me the number of complaints and the type of complaints that have been registered by both the USDA employees and farmers since January 1, 1997?
  Secretary GLICKMAN. You mean to kind of characterize the——
  Mr. HILLIARD. The number, yes.
  Secretary GLICKMAN. Mr. Wright will talk about what numbers we've received since January 1.
  Mr. WRIGHT. Total new complaints received on the program side, and this is kind of a mixed bag because unfortunately when we opened up some of the farmer's folders, we found complaints inside and they had not been recognized, was 199.
  Secretary GLICKMAN. Since January 1?
  Mr. WRIGHT. January 1.
  Secretary GLICKMAN. But some of those complaints in the file were not registered as such?
  Mr. WRIGHT. Not registered, not accepted and we had not sent a letter to the farmers. So we show 199 new ones that have come in. On the employment side since January 1, we have 132 new complaints.
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  Mr. HILLIARD. When you said not registered, does that mean that they have not been notified, or that you have not categorized that as a complaint?
  Mr. WRIGHT. We didn't know they were there, so all of the above.
  Mr. HILLIARD. Let me ask you—when you say we—let me tell you, I don't understand how the Department can get something, it gets in a file and you don't know it's there. Can you explain that?
  Mr. WRIGHT. I'm not so sure that I can explain it. All I can tell you is that one of the things that we tried to do, once I joined the staff trying to straighten this problem out, at the Secretary's request, we put two teams together. One to deal with the employment side and one for the program side.
  On the program side, we made a decision to put our hands on every single folder. To look into them to see what was there, to determine to what extent those complaints could be resolved. It was then that we discovered, by the way, that they had not been investigated. But during that process, unfortunately, we found some folders with one farmer's name on it, that had four or five other complaints in them that had not been processed.
  Which means, they had not been registered. The farmer had not received a response, and that's something of what we would hear at the hearings, by the way, that they never heard from us, well it was not registered, they had not been responded to and we had not asked the agency to give us a preliminary inquiry. I'm not sure I can explain how that would happen.
  I can tell you it did not happen again, in that when we receive a complaint, we both put it in our data system. We ask the agency to give us the files on it and we will proceed to process them. But some kind of way, in the last few years, that didn't occur.
  Secretary GLICKMAN. Mr. Hilliard, I just might say, that our Inspector General also has looked at this issue. He's not totally complete with his report, but I don't want to characterize what he said, but I think that it would be a fair statement to say all of the review indicates a, to put it mildly, a dysfunctional system. Hopefully, it has changed.
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  Mr. HILLIARD. Well that's, well, let me ask a couple of other questions. Because I'm not so sure that it has changed. Because we are talking about something that has occurred in the last 6 months. Were those complaints found in either the OG's office or in the Office of Civil Rights, or just in USDA General offices?
  Mr. WRIGHT. All of those complaints were found in the Office of Civil Rights.
  Mr. HILLIARD. All right now, what procedures have you set out to make sure this doesn't happen again? You told me you've got something in place. Let me hear it.
  Mr. WRIGHT. On the tracking system, a couple of things. We've put a staffing plan together and have started to hire people that can do the kind of things that needed to be done to both track, investigate, process, adjudicate and make a decision. And one of the things that we are going to do, we are going to put a staff together of computer experts that will track details on every complaint from the second it comes in the door, until it leaves.
  So not only will we know that it's there, both in terms of the files and the computer program, we will know the details and we can tell you where it is located. So that is one aspect, just the tracking itself. We are going to hire investigators so that once the agencies provide us with their response, we will be able to send investigators out to investigate those complaints with a goal of having a decision within 180 days.
  In other words, we would like to have a final decision in 180 days.
  Mr. HILLIARD. When are you going to hire those persons?
  Mr. REED. I would like to add, Mr. Hilliard, with your permission, to what Lloyd has said. As of April 1, we pulled everything in to the Office of Civil Rights, and as of April 1, everything that comes in is now tracked.
  Mr. WRIGHT. We will start to hire next week. We have announced about 30 jobs. Those job announcements will close next Wednesday, the personnel office will start to give us panels and we will start to hire. Hopefully, hiring investigators first, but the computer experts and all the others will also be hired.
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  The CHAIRMAN. The gentleman's time has expired, we will try to get back if he is interested.
  Mr. Bishop.
  Mr. BISHOP. Thank you very much, Mr. Chairman. Let me adjoin in the chorus commending you and thanking you for holding these hearings. And let me also join in saying thank you to the Secretary and the CRAT Team for the job that they have done in validating what many of us have known to be existing for many, many years.
  It has been documented now and I think no one can turn his or her head away from it and I want to commend you for your efforts in going forward to eliminate these vestiges of discrimination. One of the legislative recommendations that was made in the CRAT Report is to modernize the Farm Service Agency's State and county committee system by converting all of the county non-Federal FSA positions to Federal status.
  Mr. Secretary, could you explain how critical this kind of a change is to the prospects for eliminating discrimination in the processing of farm loans?
  Secretary GLICKMAN. Well, what we support is the legislative effort, what I would prefer to see is conversion of the county employees to Federal employees, as well as status, because I do not want to create a situation where you have 10 or 15 thousand people out of a job and have to reapply. We are not talking about that. Under our proposal, the conversion would take place, both status and the employee at the same time.
  This isn't as much a management decision, I want to make that clear, as it is, although it came through the Civil Rights Report that there were, we were working in two different personnel systems, Federal employees in the county offices and county employees in the county offices. And we believe that in terms of discrimination complaints and in terms of general hiring and firing and management activities, the employees ought to be subject to one set of rules and to one boss, all the way up through the system.
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  This does not, however, affect the ability of the county committee structure to operate on policy. That would be unaffected.
  Mr. BISHOP. I guess what I was really interested in hearing was how that impacts or how that will impact or how that will make a difference in creating equal opportunity to the processing of farm loans.
  Secretary GLICKMAN. It certainly will make a more efficient office, so that everybody will be subject to the same boss, the same hierarchal system and where there are problems that take place, they will be able to be dealt with much more quickly because there will be, the accountability system will be much more clear than it is right now.
  Mr. BISHOP. Thank you, Mr. Secretary. The report also recommends that the selection process for State and county committees be changed and that county committees be removed from farm loan determination. Again, how critical are these changes to the prospects of eliminating discrimination from the farm loan process?
   Secretary GLICKMAN. The proposal says is that the committee will not work on farm loans. Those will be done through professional employees.
  Mr. BISHOP. Right.
   Secretary GLICKMAN. Because those are the kinds of decisions that are made in normal credit operations that ought to be made by professionals in the process.
  That will make sure that they are handled more professionally, in our judgement. The committee will be largely responsible for implementing farm program decisions.
  Mr. BISHOP. One final question for this round, Mr. Secretary. Sources, which will go unnamed, and rumors from the USDA, inside and outside, have suggested to some of us who sit on this committee, that the Office of General Counsel has been not cooperative, but in fact hostile to the efforts of the CRAT Team. And while I've not heard that come from the table there, I'd like to raise that and see if there is any truth to it, or if there has been full cooperation and a sharing of the mission by the Office of General Counsel to truly eliminate discrimination in the USDA?
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  Secretary GLICKMAN. I think, Mr. Bishop, it is unfair to characterize any part of the Department as hostile. I can't speak for any individual employees, because I know that not everybody agrees with a lot of profound changes that are taking place in the Department of Agriculture. But I believe that we are one team, working together.
  There are problems, I'm not going to lie to you. There are differences of opinion on occasion. But we are working together and there are bumps in the road, but by and large, I think they will be worked out.
  Mr. BISHOP. I was specifically referring to the Office of General Counsel, though.
  Secretary GLICKMAN. Well, the Office of General Counsel is a critical part of the Department in terms of making sure that we do things the right way. And, you know, lawyers dot i's and cross t's. That's what they did as they went to school. And so lawyers want to make sure that we do things properly, in accordance with statutory authority and everything else.
  Sometimes lawyers bump into policy people who want to see us going down a certain direction. The key is to make sure that we are all talking to each other, and that's what we're doing now.
  The CHAIRMAN. The gentleman's time has expired. Thank you. Mr. Boswell, do you have questions?
  Mr. BOSWELL. Thank you, Mr. Chairman. I had not thought I would anticipate because the frequently running in and out and I got out of time, my timing belt jumped a cog and I'm a little out of time right now. But this is a very important matter and I appreciate you doing this, as others have said, Mr. Chairman. And I appreciate what the Secretary said.
  I know when he looks you square in the eye, as he is looking at me right now, he means business. And I regret, Dan, that you have got to spend so much time on this, you say, maybe half your time or whatever. Until it is cleaned up, I'd say spend all your time. I mean, you've got some good help that can work on some of these other programs, and I am a farmer and I want the farm programs taken care of. But we can't tolerate this and I know you don't want to tolerate it and that you won't in the end.
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  But your work, it seems to me that it merits an awful lot of effort. And I know you will get to the bottom of it. And I know you will. But I am going to encourage you to, I don't how you get 26 hours out of a day, but it deserves a lot of attention and this ought to be behind us, it should not be going on. We all know that.
  So I applaud you for your efforts. I'm sorry you inherited the problem, but you are the guy who can fix it, so fix it and we will help.
  Secretary GLICKMAN. Thank you.
  The CHAIRMAN. Thank you, gentleman. Mr. Jenkins.
  Mr. JENKINS. Mr. Chairman, let me pass at this time. I may have questions later.
  The CHAIRMAN. The Chair is going to now open the questioning to members for a second round, and I will recognize you as you indicate you want second rounds. Mrs. Clayton.
  Mrs. CLAYTON. Thank you. Just on the implementation side, again Mr. Secretary, I think as all of us have noted your efforts and your motives and we understand that. But your analogy of this bureaucracy being so massive like an elephant can't help us but recognize how difficult it is to get your arms around an elephant.
  And one of the ways to get it, is to have your legal advising office in congruent with what you are trying to achieve. It doesn't go unnoticed. Not just rumors, there has been public acknowledgement of some divisions between the General Counsel's Office—and that is such a critical part of what you do. So at some point, we have to recognize that the lawyers of our operation have to be consistent with our policy, or we have to find out how what we are proposing may be out of sync with what the law permits, so we can reconcile to ignore that or to pretend their reason is different that is going to be constantly an impediment of getting our arms around this elephant, because you need your legal people there and your advice.
  And my understanding is that has indeed been a difficulty. There are 200, I may be incorrect. Are there 250 lawyers in your shop and maybe only three of them are minorities?
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  Secretary GLICKMAN. That may be true. Let me just, I would like, if possible, we have one of our General Counsel people here, and I would like him to respond, because I think it is important.
  Mrs. CLAYTON. Yeah, I think it would be important because, you know, we would not want to mislabel. But there is a lot of conversation in even the press now, as it relates to the lack of the cooperative spirit or perhaps just being a deterrent. And I would like that not to be the case, but if it is the case, we need to bring it on the record.
  Secretary GLICKMAN. This is J. Michael Kelly, our Associate General Counsel.
  Mrs. CLAYTON. Mr. Kelly, could you help us to understand is there problems in implementing these recommendations. I am amazed that only five major cases have been settled, to date, out of 800. I understand some have been—but it takes the lawyers, you know, these staff people they have great intentions, but unless they get legal advice so they can settle it, they are not going to settle it. So what's the problem, they are not doing it?
  Mr. KELLY. Mrs. Clayton, thank you very much for asking the question and giving me the opportunity to respond, and I will try to do so briefly. I realize that each time one of you gets a chance to ask some questions, the time goes by pretty quickly. I don't want to take a long time doing this.
  The Office of General Counsel has been trying its best to assist the Department for decades in carrying out its civil rights responsibilities. We have advised over the years with respect to its responsibilities in employment discrimination, in discrimination against participants in government programs under title 6 of the Civil Rights Act, in discrimination with respect to borrowers and other persons who interact with the Department under programs which we conduct ourselves. Which is basically what we are talking about, when we are talking about these farmers and program participants who have been the subject of the cases most recently settled.
  It is the role of the Office of the General Counsel to provide as much assistance as we can in every one of the these arenas, and we have tried very hard to do so and we continue to try to do that. Notwithstanding the chorus behind me, that is the truth. It is our role to advise Mr. Reed, Mr. Wright, their predecessors, in fact Ira Hobbs when he was settling some of the cases that we've been talking about today, how to do so within the limits of the law.
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  Our office has taken the lead in seeking authority from the Department of Justice with respect to the payment of compensatory damages. Until the General Counsel Jim Gilliand in 1994, asked the Department Justice whether there was authority under any statute to take compensatory damages, it was the position of the U.S. Government, that no statute constituted a sufficient waiver of the sovereign immunity of the United States, to permit a Federal Department or agency to pay compensatory damages to participants in our programs when they were discriminated against.
  Mrs. CLAYTON. Let me see if I understand that. There is no statute in the law that allows any administrative agency to pay compensatory damage when in fact discrimination has been found?
  Mr. KELLY. That is correct. It is correct with two exceptions. No. 1, under title 7 of the Civil Rights Act, when we have complaints of discrimination in employment, there is now a limit of up to $300,000 per complainant of compensatory damages. So that's a statutory scheme that takes care of that.
  In our program activities, only in cases arising under the Equal Credit Opportunity Act, as the Justice Department held, that administrative agencies, executive branch agencies have authority to pay compensatory damages. That was a decision which the Department of Justice reached only after our office had sought that authority and asked for their opinion.
  So we have been proactive in that respect, and it is only with, under that authority in fact, that the compensatory damages elements of the payments made under the settlements recently negotiated, were able to be paid.
  Mrs. CLAYTON. So you are making a distinction between the programs and in title 7, the law allows in title 7, but gives a ceiling?
  Mr. KELLY. That is correct. Under title 7 there is a clear authority to pay compensatory damages to Federal employees or applicants for Federal employment when they have been discriminated against in employment relationships.
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  Mrs. CLAYTON. There have been some very large cases against Federal agencies on sex discrimination as well as on race discrimination against agencies where money has been settled. I don't mean Agriculture, but so the issue must be program?
  Mr. KELLY. The issue must be program unless you are talking about employment discrimination cases which constitute class actions. If you have multiple plaintiffs, you have well be able to trump that $300,000 per person ceiling.
  The CHAIRMAN. The gentlelady's time has expired.
  Mrs. CLAYTON. Thank you.
  The CHAIRMAN. Thank you for very much. Mr. Goodlatte.
  Mr. GOODLATTE. Thank you, Mr. Chairman. Mr. Secretary, I would like to pursue the line of questioning I was following before regarding the settlement of these cases, because as I said before, it is very important that we root out this discrimination and that we compensate those people who have suffered loss as a result of any discrimination on the part of the Department.
  But it is unfair to other black farmers who do not file claims, do not suffer discrimination. It is unfair to taxpayers. It is unfair to everybody else in the process if any of these claims are settled for amounts of money that exceed the appropriate damages. Is the Carpenter case one of the four cases that you are counting as a settlement under this provision?
  Secretary GLICKMAN. Yes, that's correct.
  Mr. GOODLATTE. And the reason I ask that, is that the case was not settled as a civil rights case, I understand, but rather as a program case, is that correct?
  Secretary GLICKMAN. I'd ask Mr. Wright to comment on that.
  Mr. WRIGHT. No, that is not correct.
  Mr. GOODLATTE. It is my understanding the a farmer's rights to sue under a civil rights claim was preserved as a part of the settlement?
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  Mr. WRIGHT. Only to collect attorney fees and compensatory damages, which the law specifically provides that they are not entitled to. But to reach a settlement, we decided if they wanted to reserve rights that did not exist, they could have them. All other items relating to this case were resolved, including 15 existing complaints and five that would have been pending.
  And I think the case was solved because of discrimination. All these are program complaints. Everything in the program side would be program complaints, this would be no different. The difference here is that it was a disaster kind of payment. We have concluded a finding of discrimination and have included that as documentation in the file.
  It started off differently, but ended up being the same as any other that would have been resolved. So I would say that we resolved all issues, including accountability and that the agency will be accountable for action involving this case.
  Mr. GOODLATTE. Let ask, it is my understanding that the Arkansas State FSA committee, the agency headquarters staff and the National Appeals Division all recommended that there not be a payment. That they concluded that the Carpenter's contributions to their farming operations, there was no basis to conclude that the Carpenter's contribution toward their farming operation were commensurate with their claim shares of the operations.
  What was it that caused you to reverse the findings at those three levels and did you find evidence of discrimination on the part of those people making those findings of fact at those three levels before you——
  Secretary GLICKMAN. Mr. Goodlatte, could I just make a comment?
  Mr. GOODLATTE. Sure.
  Secretary GLICKMAN. I'm not sure the propriety of talking about an individual case involving individuals here. We would be glad to discuss this case with you and your staff personally. I don't know what the non-disclosure requirements were in the agreement.
  Mr. GOODLATTE. If you have a non-disclosure requirement, than we certainly want to respect that.
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  Mr. WRIGHT. And we do.
  Mr. GOODLATTE. But we are talking about the taxpayers dollars, so we do want to make sure——
  Secretary GLICKMAN. Yes, that's true, I understand that. That's why you are entitled to know the case, but I just think part of the agreement was non-disclosure on both sides. So I would be a little reluctant talking about this in open session. But we'd be glad to come to your office and go through the case.
  Mr. GOODLATTE. Well, if that's the case, then we will submit some additional questions to you and you can, based upon your agreement with the settlement, respond to us as you feel is appropriate and we would like to know the basis of these settlements. Not from the standpoint of not wanting to root out discrimination, but from the standpoint of any settlement you would make with anybody on any basis, making sure that it is responsibly done and based upon sound evidence.
  Mr. KELLY. Mr. Goodlatte, if I may simply say, if we could know whether you intend to use those responses to put in the record of this hearing, we will know how forthcoming we can be with respect to that.
  Mr. GOODLATTE. Well, I would say that anything that is, it is, and the chairman can give us some guidance on this. But I would say that anything that is not bound by any prior agreement, would be subject to being made a part of the record. If it is subject to a prior agreement that can only be disclosed within the Government, it can't be disclosed outside the Government, we would want to know that.
  But as long as you have that basis for making that limitation, we would not make it a part of the record. Is that how it stands, Mr. Chairman.
  The CHAIRMAN. If I might, the rules of the House provide that a special provision and action be taken by the House if there is to be disclosure from an agreement between the Government and a client, so that the information that you may offer Mr. Goodlatte will not be made a part of the public record unless this committee acts and the full House acts on that issue. Those are the rules of the House.
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  Mr. GOODLATTE. Thank you, Mr. Chairman. Those were all the questions I had. Thank you, Mr. Secretary.
  The CHAIRMAN. Thank you. Who seeks time? Mr. Thompson.
  Mr. THOMPSON. Thank you very much. Mr. Secretary, we just heard the Office of General Counsel make some representations about authority of the Department. Do you agree with that? To settle cases.
  Secretary GLICKMAN. Well, I'm not sure exactly. Which representation are you talking about?
  Mr. THOMPSON. He gave two instances under which you have the authority to, or the Department has authority to settle cases.
  Secretary GLICKMAN. Administratively we settle cases. I'm not sure he gave all the cases, I don't know. I agree with what he said based upon my knowledge of the law, but I don't know if he completed all of the areas that he'd be talking about.
   Mr. KELLY. Mr. Thompson, maybe I mislead the committee or you. It is clear that the Department and the Secretary have authority to settle all cases pending, whether arising out of program discrimination or employment complaints. My only limitation was, that there are limits with respect to the payment of compensatory damages.
  Mr. THOMPSON. OK. So Mr. Secretary, I understand that to mean that there is no question that the authority to settle these cases is in fact available to you right now?
  Secretary GLICKMAN. That's correct. Assuming there is legal authority for me and that the facts justify the settlement, I have the full authority.
  Mr. THOMPSON. Now, are you aware of any effort to take that authority from you?
  Secretary GLICKMAN. You mean to limit me to settle cases?
  Mr. THOMPSON. Well, you know, we have this thing called the Judgement Fund. Are you aware of that?
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  Secretary GLICKMAN. I am aware of the Judgement Fund.
  Mr. THOMPSON. And that I'm told there is some discussion that would take that authority from you and put it in another Department.
  Secretary GLICKMAN. Well, you are talking about the Judgement Fund. The Justice Department has to sign off on it and perhaps Counsel may talk about the differences in the funds by which settlements are made. But I am generally aware of what you are talking about. But perhaps Mr. Kelly may want to comment on that.
  Mr. KELLY. Sure. Mr. Thompson, any funds available to the Department, whether salaries and expenses funds or program funds are generally available for use in the payment of settlement amounts to persons to who we have determined have been discriminated against. When a case is in litigation, that is to say when it is pending in the Federal courts, the Department's ability to act is limited by that fact.
  And, in fact, the major player in those cases is the Department of Justice.
  But if we are talking just about cases pending before the Department, where no litigation has been filed, generally speaking the Judgement Fund would not be available, USDA funds would be to pay those settlements.
  Mr. THOMPSON. For the record, Mr. Wright or Mr. Reed, do we have any complaints of discrimination pending before the Office of General Counsel? Now don't give me the name, just yes or no.
  Mr. REED. You mean for Justice?
  Mr. THOMPSON. Employment. Office of General Counsel.
  Secretary GLICKMAN. Filed against the civil rights, the General Counsel's Office?
  Mr. REED. I do not know, Lloyd, do you know?
  Mr. WRIGHT. We have four complaints where we have findings that have not been resolved. The actions on those four complaints was filed in court and Justice is now handling those. So we are involved in——
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  Secretary GLICKMAN. No. You mean like employment complaints against the civil, anybody in the General Counsel's Office. Just a normal employment complaint.
  Mr. WRIGHT. You mean an employment complaint?
  Mr. THOMPSON. Yes.
  Mr. WRIGHT. I'm sorry. The answer is yes.
  Mr. REED. The answer to your question is yes. We will get the specific numbers for you.
  Mr. THOMPSON. OK. With respect to Mr. Reed and your position, can you list for me, one, two, three, what impediment, if any, prevents you from completing your job at this point?
  Mr. REED. Yes, I can. The first one is a systems problem and that is the ability to get the program complaints investigated. And it is not an impediment at USDA. The Secretary has given me all of the authority that I need to do that. The problem with it is that, as Mr. Wright has indicated, we do not have investigators and we have only been able to find enough qualified investigators outside of the Government to contract with to do about 100 of that 700 plus backlog.
  So I see that as a major impediment. Notwithstanding what you may have heard about the relationship between my shop and Lloyd's shop with the Office of General Counsel, I think the Secretary has taken both groups to the woodshed and if that was an impediment, it is no longer an impediment. So we plan to move forward in that effort. So I would suggest that those are the two areas, Mr. Thompson, right now, that have caused me the most difficulty.
  Mr. THOMPSON. Thank you very much. Thank you, Mr. Chairman.
  The CHAIRMAN. Thank you, Mr. Thompson. Let me ask you if that impediment is because of budget constraints or is it because of systems concerns?
  Mr. REED. It's both.
  The CHAIRMAN. Well then you will be sure and detail for us the budget constraints, because we would like to help you in that respect.
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  Mr. REED. With the Secretary's permission, yes, we will do that.
  The CHAIRMAN. Thank you. Who seeks time? Mr. Bishop.
  Mr. BISHOP. Mr. Chairman, I was just handed a recent news article, and this is following up on my question about the relationship between the CRAT Team and the Office of General Counsel, which seems to document that there has been some serious misunderstandings, I think they are characterized as in the article.
  [The newspaper article appears at the conclusion of the hearing.]
  Mr. BISHOP. But I did hear what Mr. Reed said that both parties had been taken to the wood shed and that those problems have been resolved. That was since yesterday?
  Mr. REED. This morning.
  The CHAIRMAN. Please. Go ahead, Mr. Bishop.
  Mr. BISHOP. I give back my time, Mr. Chairman.
  The CHAIRMAN. Mrs. Clayton.
   Mrs. CLAYTON. Because I know this question will be pervasive with farmers who have been aggrieved that as we federalize our system and I understand the reason and we have legislation to support it. As we federalize the system, some assurance that there is a system within the Federal Government that would address complaints of discrimination and that those parties held responsible for those acts of discrimination they would be dealt with.
   Because I'm reminded, and you are not unmindful of it obviously, that many of these complaints are by the Farmer's Home administrators who were federalized. And they were the aggrieving parties. So if they violated the law, what system would you now show us that would be implemented, that once we put it and federalize it, we can think that that system will expedite and be efficient in investigating and resolving in a timely way and the employees who were violating the rules would be dealt with.
  Secretary GLICKMAN. The only thing I would say is this. It really depends on our will to have a complaints and investigating and an accountability system within whatever organization we have. My own belief is this whole issue of federalizing county employees is largely a management issue, not really a civil rights issue. I want to make that clear.
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  Mrs. CLAYTON. Right.
  Secretary GLICKMAN. Because as you said, a lot of the complaints have occurred in the farm lending operations which were not part of the county employee system at all. So we think it is good management practice to have one set of line authority within the system. But it really does depend on our changing the accountability systems and the valuation systems and the complaint handling systems to make sure that it gets done. So it doesn't matter what kind of system you have.
  Mrs. CLAYTON. Just say a word about what that system——
  Secretary GLICKMAN. That's what Mr. Reed is doing. That's his main thing that he's been involved with.
  Mr. REED. Mrs. Clayton, without getting into the specifics, we have at least six recommendations in the CRAT Report that deal with this accountability issue. And I would agree to come up and go through that in whatever detail you would like. But once we get those systems that are now dysfunctional, back up and functioning, we will have the mechanism in place so that the Secretary can adequately hold people accountable.
  Mrs. CLAYTON. Thank you, Mr. Chairman.
  The CHAIRMAN. Mr. Thompson.
  Mr. THOMPSON. Thank you, Mr. Chairman. Mr. Secretary, can you address the foreclosure issue with the individuals who have discrimination complaints pending? Has, in fact, your directive been violated?
  Secretary GLICKMAN. I'd ask Mr. Wright to perhaps——
  Mr. THOMPSON. And if so, if they were violated, did you deal with the violator and if in fact did we resolve any of those problems?
  Mr. WRIGHT. I think I'm aware of four cases where foreclosure procedures proceeded after the announcement was made by the Secretary that we would not have foreclosures if there was a discrimination complaint filed. However, we found that the policy was not clear enough and we had not put an independent review process in place to resolve that.
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  We went back to the drawing board and we designed the process that did two things. We redefined the policy so that people would understand what we meant by foreclosure. In some cases they were doing everything except selling the farm and as though they were not foreclosing. In other words, they accelerated the loan and did everything else except had the sale.
  That's the way the agency thought that they should carry out the policy. When we redefined the policy, we made it clear that you couldn't take additional steps. So since that time, there has not been a violation that I am aware of, but some did occur prior to that time.
  Mr. THOMPSON. Four?
  Mr. WRIGHT. Four that I am aware of.
  Mr. THOMPSON. Did we stop the actual loss of the property?
  Mr. WRIGHT. These had already occurred when we became aware of them. Actually the IG found those cases.
  Mr. THOMPSON. So what did we do with them?
  Mr. WRIGHT. In some cases the foreclosure, when I say foreclosure, in some cases the foreclosure really amounted to acceleration, which meant that the entire loan was called in. In some cases, it was not even sold. Still, what they've done is called the entire loan in and that is part of the foreclosure proceeding.
  Secretary GLICKMAN. I'm not sure the property has been sold in any of the cases.
  Mr. WRIGHT. That's what I'm saying.
  Secretary GLICKMAN. But I think we can get the information to you. I'd like to respond in writing to this, because there maybe legal situations there. But we will it to get you.
  Mr. THOMPSON. I'm just, I'm concerned that even after you sent your directive out, that there are four documented cases and I'd like to know what happened with those cases.
  Secretary GLICKMAN. Sure.
  Mr. THOMPSON. If the people are still made whole from that. I'd like to see whether or not we did anything of a disciplinary nature to those employees in those four cases.
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  Secretary GLICKMAN. Yes, we will provide you that.
  Mr. THOMPSON. Thank you, Mr. Chairman.
  The CHAIRMAN. Mr. Hilliard.
  Mr. HILLIARD. Yes, thank you very much. Mr. Secretary, on the same note I would like to have that information, and I would like to know whether either one of those four persons was evicted. And if so, what followup steps were made in each case?
  Secretary GLICKMAN. We will get that to you. I don't think there has been a sale in any of the cases, but we will check it out for you and we will let you know.
  The CHAIRMAN. Anyone else seek time? If not, Mr. Secretary, thank you very much for your patience and your openness to answer all questions.
  Secretary GLICKMAN. Thank you.
  The CHAIRMAN. We appreciate you being here and I think we have begun a good and momentous program. Thank you very much. We will take a short recess.
  The CHAIRMAN. Come to order please. We would like to call Mr. Conyers and Ms. Waters. I thank the gentlelady and the gentleman for their patience and we appreciate your contribution to this hearing.
  Ms. Waters, please.
  Ms. WATERS. Thank you very much, Mr. Chairman. I am indeed patient and would have stayed all night if I had to, because this issue is tearing us apart. As you know, earlier this year on April 23, the Congressional Black Caucus convened a hearing on the Crisis of the Black Farmer in America. Copies of that hearing are available, I think, through C-Span who covered it gavel-to-gavel.
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  The testimony was heart-wrenching. We witnessed in that hearing third and fourth generation farmers who were at the point of total collapse and families who had lost everything trying to work with this Department of Agriculture. Trying to get loans, trying to get some assistance, trying to hold onto their land. The testimony was awesome.
  As a result of the coverage of that hearing, we have been besieged with calls in all of our offices. People saying, ''do something, do something.'' I am very pleased that we have on this committee members of the Congressional Black Caucus who have been working hard at this issue for a long time.
  And it is amazing, really, I mean I thank you for having this hearing, but it is absolutely amazing that in America, both Democratic and Republican administrations, this committee led by both Democrats and Republicans have turned a deaf ear, basically, to African-American farmers and this problem has been going on for a long time.
  Secretary Glickman, I think is a good man. And I really think he believes that he can get the job done. And I think he wants to get the job done. I served with him, I know him and I have a great deal of respect for him. But you know, I really do believe that the problems are so entrenched, that the racism is so deep, that the discrimination is so profound in the U.S. Department of Agriculture that it is not simply the Secretary wishing to get it done, and it is going to happen.
  These bodies are buried deep. You heard some reference to what happened after the Secretary issued an initiative to stop the foreclosures, have a moratorium on foreclosures, if in fact there was a filing of discrimination or a discrimination complaint, and it appears that they just kind of went on. I think that's what happens in the U.S. Department of Agriculture.
  I really do believe that those complaints that were found in the file that was described here today, that were just thrown in somewhere. I really do believe that over the years, there has been a real conspiracy to deny access to the resources of this Department by people who have worked in it. And let me tell you why I believe that.
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  First of all, if you take a look at the system, and I heard some references to changing this county committee system, I mean it was a no-win situation for African-Americans. First of all, these people who sit on these places, they elect themselves and it was all about farmers who were active farmers electing each other. And because we had little or no assistance to acquire land, to have money to plant seed, all of that, basically you had white farmers. These white farmers who elected themselves and selected the director and made decision about loans, they just excluded folks. And there was no recourse.
  And the very people who were discriminated against, who could not be elected by whites. The very people who were discriminated against, had to give their complaints, to the very people who would not vote for them so that they could serve. I'm not standing for any blacks serving on any advisory committee with no votes. That doesn't mean anything.
  I mean, if they had more votes in the system now, they can't do anything about the decisions that are being made. I mean, that's not very helpful. But let's, you know, and take a look at the system. African-Americans go in, they are denied the loan, they are discriminated against cases. They are called niggers, cases where the application is thrown in the wastebasket in front of them. And then these African-Americans have got to say, now will you file this complaint against you.
  And you know what happens? I'll tell you what happens. Not only did they not get filed, but the whole system was shut down in 1983. They closed down, basically, the Civil Rights Division, nothing has been happening. And it is just now, after the farmers have rallied, demonstrated, gone to the White House. These members of the Congressional Black Caucus who serve on this committee have tried to work with everybody. After all of this, that the CBC with no real authority, just decided we were going to have a hearing.
  We didn't need any permission from anybody to do it, because nobody else was doing it. And all of this has culminated in this hearing and in what the Secretary talked about today. Wanting to do the report that has been done. And I'm, well I'm a little bit, well I'm a little bit grateful that something, that we have a platform, that we have a forum. But I'm not as optimistic as I ought to be about changes taking place.
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  Since the time of our hearing, we have had very few complaints settled and I'll tell you why they can't settle them. Yeah, there's a problem. They don't have investigators. And nobody knew they didn't have investigators since 1983, until a few months ago. So the complaints that were coming in, didn't get investigated. I mean, it's outrageous.
  Then you have the General Counsel who says, ''Look, we can't give away money, we have to have a finding of discrimination.''
   Who's going to do the finding and you have no investigators. And even now, when you go back and look at these 700 or 800 cases that they have, Mr. Chairman, the trail is cold. These, they go back so many years, until even if we get the investigators, going back trying to, you know, get this information, people have died. People have lost their farms, they have given up. People are scared of white folks still, in some places.
  They are not going to—and it goes on and on and on. So we are never going to have the findings that may be required to settle these claims. And Mr. Chairman, it is going to take some extraordinary action. And let me suggest to you, I'm not an attorney. But I'm good at fashioning resolutions and decisions and negotiating, I'm good at that.
  I think that we should put together a process to look at these 700 or 800 claims and set some guidelines for things we should look for and not go through the rump of now getting on some investigators to go back 10 and 15 years, et cetera. I think we should agree on some acceptable criteria and get these claims out of the way and off the books. And not have them stopped by saying, oh well, we've got to have these findings. Can't have the findings, can't settle.
  That really does not give anybody any confidence that the system will correct itself. And the system needs to show some sensitivity now and say, yes, it has been agreed that there has been discrimination. Not only have we documented that there has been discrimination, nobody has had to pay a price for it. Those people who discriminated, the employees, because everything that has been done, even when there has been recognition, has been without fault, no fault.
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  And so now we've got people who are retiring, who have already retired, they've got great pensions, they can go on off and live a happy life, while some people's lives have been destroyed. No penalties, it is without fault they say. And they tell me they are putting something in the system now that will change that. But still, I am not ready to believe yet. I mean, I've got to see a lot more, but here's what I would offer.
  While we are looking at it, and this discrimination by the way, is not simply in the loans, not simply in the support for land acquisition or farm land purchases. Conservation we won't even talk about. Disaster money, we won't even talk about. African-Americans didn't get any of that. And we can go through this whole system and I'm not even talking about the employees with all the discrimination complaints backed up.
  What we need to do is move very aggressively with new criteria designed to get rid of these complaints. We need to make sure this man's got the investigators that he needs. As of this day, right now, he does not have enough money to cover the investigators that they are talking about finally hiring. It is going to take a long time to change their accounting system. We are going to have resistance from everybody. We are going to have resistance from elected officials who are going to get bombarded by their constituents saying, don't change this system, we like this system, it works for us.
  And because they depend on it to get votes, not only is that system racist and discriminatory, there is a lot of nepotism in it. Folks who've got relatives in the system, ain't going to want to change this system. And I say ''ain't'' for emphasis. Now let me just say this. You have some power, Mr. Chairman, as the chairman of this awesome committee. This is an awesome committee, you know.
  You have great oversight responsibilities for one of the biggest agencies of Government. And I think it is going to take a lot of work with this chairman. Mr. Stenholm, I think you can do this too. And I tell you, some of us, Mrs. Clayton, Mr. Hilliard, Mr. Thompson, we'll all be voting to get in a room and work around the clock to help move these complaints. To help get them out of the way. I don't want another African-American to die heartbroken about having been discriminated against and stepped on by an agency of Government, this agency of Government.
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  I think we can do this. And it's not about Mr. Canady sitting up here and talking about, I want you to make sure you don't have any goals, you don't have any objectives, we know where he is coming from and I wish he'd still remained here. I serve on the Judiciary Committee with him. I know what his priorities are and I am going to say it, even though you don't like it.
  The CHAIRMAN. Please don't, please Ms. Waters, let's don't discuss individuals.
  Ms. WATERS. Mr. Chairman, I am one of those persons, that you must know by now, gonna tell the truth, gonna tell it like it is and I'm not confined by the niceties of the ways of Congress which does not allow us to talk to each other. I could come here and talk your language all day and talk about the nice gentleman and the good lady, but I want to tell you something.
  When you have systemic discrimination, Mr. Chairman. When you have discrimination and racism that runs as deep as this. Bodies buried that this Secretary may never get to in his life of service as Secretary. I don't want hear anybody talk about make sure you don't have any goals, you don't have any timetables. I know he is the author to dismantle affirmative action in Federal Government.
  I want somebody talking about how we make up for what we've done to my people, to my people. If I couldn't tell you that in this committee, I wouldn't be worth my salt. And I shouldn't be here.
  Ms. WATERS. No, don't. I don't want this chairman to throw you out, just be quiet. I can take care of this. So all I'm saying to you, Mr. Chairman, is this. Use whatever power you have.
  Mr. Stenholm, work with us. Members, work with us. But let's show some good faith and some sensitivity. Let's move these complaints. Let's clear up these 700 complaints in a fashion that we design. Even if we have to go quickly and try and get some legislation to do it. I think we can convince our colleagues, it is the right thing to do. It is the godly thing to do. It is the only thing to do.
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  I am going to put priority time of the Congressional Black Caucus on this issue, I have to. I must do that. If you work with me, we can solve this. I'm not going to go through all this and question anybody on whether or not this aspect of the CRAT Report makes good sense or what have you. We've got a lot of work to do. Let's get started. But No. 1, getting rid of these complaints and No. 2, dealing with the harmed employed right inside the Department who have got all these complaints back up.
  Now, Mr. Chairman, you can quiet me.
  [The statement of Ms. Waters appears at the conclusion of the hearing.]
  The CHAIRMAN. Oh, I don't want to quiet the lady. I just remind her that the reason she's here is because we called this hearing.
  Ms. WATERS. That's right, and I appreciate it.
  The CHAIRMAN. Mr. Conyers.
  Mr. CONYERS. Good afternoon, Mr. Chairman and members of the committee. I want to thank you very much for this opportunity. You've been commended many times during the course of this hearing for calling it and I add my commendations.
  If I might be permitted to append to my own submitted testimony, a statement from John Boyd, president of the National Black Farmers Association and Lawrence Lucas, president of the USDA Coalition of Minority Employees.
  The CHAIRMAN. Without objection, so ordered.
  Mr. CONYERS. I thank you very much.
  [The statements appear at the conclusion of the hearing.]
  Mr. CONYERS. Thank you very much. Now, I have worked with the gentlelady from California for many years. She has been a distinguished State legislator in California, as we probably all know. And she says that she is not a lawyer, but the only thing she doesn't have is a law degree from any number of schools that are willing to grant it to her.
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  She served on the Judiciary Committee in California. She serves on the Judiciary Committee here. I can personally attest that she knows more law than some lawyers. And so when she claims she isn't a lawyer, you should take that with a grain of salt. She is very well-versed in the statutes, both Federal and State, and I've learned that across the years.
  Now as we close these hearings, I have a request, Chairman Bob Smith, that I would like you and the ranking member, Mr. Stenholm, to consider. This has been an important day in the development of democratic principles in our oldest activity, farming in America. This has been a very important day. It will go down in history. Now the next thing that I would invite you to consider is that we hold another hearing in the month of September in which there would be no Members of Congress testifying and no members of the Government, or the Department of Agriculture testifying, it would be only members of the farm communities from the several States of people who have been affected by the practices and policies that have been discussed here with you today.
  In other words, it would be a hearing from the people themselves. They won't have any lawyers explaining to you or their Congresspersons or anybody else. You will just be hearing their own story. And if you combine that with this, well then you will have done two things. One, you will have completed the picture that we need in the Congress to go forward.
  The second thing you will have done is to restore the confidence and belief of thousands and thousands of people who have been devastated by the practices that come before you. And so to the ranking member and the Chair, I respectfully lay that request before you. That we have a day for them to come in and just talk with you like it is. What do you think?
  The CHAIRMAN. Well, Mr. Conyers, I appreciate that thought. Either one of you may not be very familiar with the way this committee operates, but this committee represents one group of people in America. Not industry, not giant corporations, we represent farmers. That's what we do and that's all we do. So we want always to present an opportunity for farmers in America to be heard. This may be the only opportunity in this Government that farmers are represented directly.
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   Now, I'm not negating what's happening with the Department of Agriculture at all, but this is a place where farmers are heard, and that's what we do. So I take your recommendation under advisement and I will certainly get back to you.
  Mr. CONYERS. I certainly appreciate your consideration. Now my dear and good friend from Texas, Mr. Stenholm, with whom I've had a great deal of work, even though I have never had a lot of contact with substantive matters of this committee, I know to be a person with whom we can work. He has worked with the Congressional Black Caucus, the present chair of the Caucus and he's worked with us on common issues of national importance, especially with reference to the budget, for many, many years.
  As a matter of fact, he is a respected leader on budgetary questions as well as agricultural matters. So I will be chatting with him about this as well. I thank you so much. This is really wonderful, because this could move us forward quite a bit. Now, through all of this has been stories of what has happened.
  One of the problems that a national legislature faces is the fact that some people have already been destroyed, some families have already been put asunder. Some kids lives have been twisted. A number, several, maybe many deaths have occurred. The whole tragedy, we can't turn back the clock. So I'd like you to think about the, conceptually about the concept of reparations as it would apply to this subject matter.
  Because we are going to take care of, like Maxine Waters, I believe Dan Glickman and we all know him as a former colleague of highest integrity. I believe that we are going to take care of the present problem and it's going to create a lot more problems than Dan Glickman knows about, for reasons I will tell you next. But the black farmer is on the route to extinction in the country as this year goes on.
  I mean, there are some things that we will never, ever be able to get back to and correct. Thank God, we were able to do it this year. Thanks to the lady sitting to my right. But with our best efforts, there is going to be, there is still a history out there and some of it's being written about. About the people who will never be able to tell their story to anybody, because they are just not here anymore. It is a long, unhappy chapter in American history.
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  And so we might want to think about that obligation that we may or may not be able to get to. Now the reason that our beloved brother Glickman may have a problem far more serious than he knows about, is because of the experience I am going to relate to you about the danger of underestimating entrenched bureaucracy in Washington. This is a serious situation. And as a member of the Judiciary Committee since the first day that I have arrived in the Congress, a lot of my experience comes out of law enforcement.
  I can name you three ex-directors of law enforcement agencies, one of the FBI, who came to their office, one was a judge, a Federal judge, experienced lawyer, who came to these agencies and ran into the problem of racial discrimination and met with us and undertook to correct it. Totally serious, in perfectly good faith. And do you know what happened to them? They ended up leaving the agency. There is one major law enforcement agency now that is about to undergo a change, because the resistance is totally unrelenting.
  There are people in these bureaucracies who could care less who the President of the United States appoints to be the Secretary or the Director, irrelevant. And they make it very clear to the appointee, as soon as he or she is confirmed and go down there and they say, well we call everybody in and they sit around the table and say, we were here when you got here, we will be here when you leave. You can issue all the directives, executive orders, memos of understanding that you want, but we are here and you are the one that's in transition.
  And I have an eerie feeling having listened to the CBC hearing and this one, is that our beloved Secretary may be dealing with something so deep, he's already confessed here today that he's spending more time on this than he is on agriculture matters, and I know he's telling the truth. But he doesn't know how much more time he's going to be spending on this.
  Because I want to say this in the most non-personal way that I can, but James Gilliland, the General Counsel of the Department of Agriculture is not not here today because of anything other than for him to have been here would have turned this hearing into total chaos, total chaos. You see, the problem has been delicately put by the members of the committee. It has been delicately, and properly so, responded to by the Secretary.
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  It's been appropriately addressed by the Secretary's good staff. But you see, the press doesn't play around. They don't have to be delicate. ''Officials Say Colleague Blocks Progress. Glickman Tries to Resolve the Matter.''
  When? This morning, a few hours ago before this hearing, the Secretary, appointed by the President of the United States, was trying to get his house in sufficient enough order to come before you. That's how bad it is. And that's why you are holding a followup hearing excusing all of us and the Secretary and just letting the people speak as you so aptly pointed out that this is the place where farmers come.
  And now it is our turn to give the farmers their day. And if you do, I think you will be doing more to help us undergird and support a Secretary who is going to be eternally grateful for what we've done. I know he had good relations with the committee. I know he's been an outstanding member of the committee. He knows his business and I hope that we'll do all we can to help him and thank you for allowing me this time.
  [The prepared statement of Mr. Conyers appears at the conclusion of the hearing.]
  The CHAIRMAN. I thank the gentleman. Are there questions of this panel? Mr. Thompson.
  Mr. THOMPSON. In terms of the two speakers, let me complement you on both your comments and the interest that you've shown, historically, in this area. I might add, and I hope Mrs. Clayton addresses it at some point, that there is some legislation being proposed to address some of the concerns that we've heard. However, they will not address all of them.
  There will still be other areas for future resolution. The county committees, as some of us see, cause a lot of problems. The minority advisor concept is an insult to every African-American in this country. It is an insult in that you are put on a committee and given no voting right and that is supposed to pacify African-Americans in that particular county.
  So those who argue otherwise, I would hope that they would consider the impact that the so-called minority advisor had. The other thing I want the record to reflect is that in my state, in those county offices, there is no written personnel policies and procedures for the staff. The county committee hires who they want. Sometimes it is a friend of somebody on the committee. Then that county executive director, in turn hires somebody else's son or daughter and that county office—you've got a mess.
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  And in many instances, the record will reflect that some of the people who had problems with those offices, have in fact ended up owners of the land that was foreclosed on by those agencies. So I want to complement Mrs. Clayton on her leadership in trying to help resolve some of this.
  Secretary Glickman said we have two personnel systems. We do in one of my counties. Black employees are told you are under, you are covered by the Hatch Act. And in other counties, white employees can run for office because they are not Federal employees. So it is that double standard that exists. And I complement the effort to try to get us under one personnel system, so at least we can have individuals who are paid by the Federal Government, also in the Civil Service System that makes them accountable to a personnel system.
  Ms. WATERS. If the gentleman would yield for a moment. One statement that you made about land that was foreclosed on, ending up in ownership by people who sit on the committee making the decision is what is really leading me to call for a massive investigation by the Justice Department in this systemic discrimination. Now, I haven't moved to that point yet, because I really followed the lead of those of you who come from districts where you have lots of farm land and agriculture.
  But I heard this once before that, and I think it was alluded to in the hearings that we had, that there had been loss of farm land foreclosed on when the loans were denied. Even though people were, you know, should have been able to get these loans. They did not give them, they sat and watched them to the point where foreclosure and then the land ended up in the hands of those who sat on the committee.
  Now I want to tell you something, that is criminal. And I don't know what the policies of the Department are relative to conflict of interest, but it is that kind of thing that leads me to want to ask the Justice Department, after we structure some of this, to investigate. I'm holding off, because I am trying to give Mr. Glickman a chance and to give us a chance to deal with some of this. But I am really concerned about that.
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  Mr. THOMPSON. Well I think, as a followup to that, Madam Chairman, clearly the old system was akin to the plantation system. And it is the plantation mind set that operates many of those county offices. And that's why African-Americans have such a difficult time dealing with those agencies because the large land owners tend to serve on the county committees and they tend to dictate the loan policy of the county, which is against small, minority farmers.
  So I agree with the Secretary that we have to refine that system, put professional people in the office reviewing loans, so those loans can stand the scrutiny of the IG, GAO or whomever. So I applaud him in that respect, so we can take any of the suspicion and doubt out of the loan processing and the loan approval of the Farm Service Agency.
  The CHAIRMAN. I thank the gentleman. Mr. Bishop.
  Mr. BISHOP. Mr. Chairman, I'd like to thank Chairman Waters and Chairman Conyers for their contributions to and their leadership on this issue. It means a great deal to the people that we represent to have the national leadership of the Congressional Black Caucus, as well as one of the, I think, the most senior member of the Caucus who have both wrapped their arms around this issue and have dug in, and to make sure that these issues are dealt with as they should be.
  And I want to commend you for you leadership and both of you for your statements. I read your statement, Ms. Waters. I am very much in support of what you said. I heard all the very poignant comments from Mr. Conyers and I just want to say thank you for taking the time to come and to offer and to give voice to these issues which often are voiceless.
  We sit on the committee and we have been working with the Secretary to try to bring this about and certainly with cooperation with the chairman and the ranking member, we have gotten this far. And Mrs. Clayton, as Mr. Thompson indicated, has prepared legislation to deal with many of these concerns.
  But we will need your continued support and leadership and all of the political massaging that you do so well, as well as the support of the chairman and the ranking member, I'm going to try to see that we can make this, these bills or these Resolutions become law.
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  And I think in doing so, we will do a great service to the country and we will make real the opportunities for a people who have been left out and certainly disadvantaged by the system at USDA.
  The CHAIRMAN. I thank the gentleman. Mrs. Clayton.
  Mrs. CLAYTON. Thank you, Mr. Chairman. I also want to thank Chairman Waters and Representative Conyers, the ranking member of Judiciary for their testimony and their willingness to participate in this hearing. And because of their demonstrated interest before as Representative Waters said, that they put this high on the priority of the black caucus, had a day long meeting with farmers from all over the country. So this has become a national problem and I thank them for their passion and their interest in that.
  And many thanks to you, Representative Conyers, who you did not articulate, but it is in your written statement, you have convened hearings on this issue and we couldn't get agriculture to convene hearings on it. For the very reason that there was not the receptivity on the part of this committee to listen as attentive and you did it as then-chairman of the Government Oversight Committee. So I want to thank you for, both of you, for taking the time.
  I want to make one observation and I think Ms. Waters made that as she was talking about goals and timetables. We are not talking about affirmative action in this program. We are talking about documented discrimination, where the Government is the perpetrator of the discrimination. I don't know how we could describe it in any more egregious terms the Government representing the Constitution of the United States is the aggressor and the violator of a constitutional right. Documented discrimination. We are not talking about giving anybody, anything at any time that they didn't deserve.
  We are talking about following the law. Making sure there is equity in service and equal opportunities for employment. And that's what this is about. I hope that this is the beginning, as you indicated, Representative Conyers, of a historical day. I hope this is not, once again, an opportunity for us to look at it and see it to be too massive. And because we can't get our arms all around it, that we say it's too big, so we won't do anything.
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  And Mr. Chairman, I am just hoping that you want to have a legacy as chairman of the committee. You already have created something historical, that no other chairman dare do, rather Democrats, and Democrats were here a long time. And not one Democrat, I want to tell you, had the courage to bring this, so indeed that ought to be a beginning.
  I hope you want to create a legacy that this committee is resolved to look at this and honestly try to do something. I want to change the image of agriculture. I want to change the image that agriculture is this kind of resistant committee, that we are open to people and certainly farmers who struggle with the land and struggle with weather and struggle with the price support worldwide. Need not struggle also with yet another burden, discrimination.
  And I hope that this committee resolve that they at least lighten the burden of—farmers in general are declining, and minority farmers. And I want to say parenthetically, it is not just about black farmers. It is about women farmers, it is about Asian farmers, it is about Hispanic farmers, it is about Indian farmers. We had them all to testify at our subcommittee that you referenced that Representative Goodlatte had.
  So it is a minority farmer, small, socially disadvantaged farmer that is indeed. So the correction we are talking about, where is the correction that speaks to all of that. It is not just the African-American farmers. It is those farmers who have not found the equal opportunity for access for loans and programs and to hand those opportunities to everyone else.
  You know, I think what we do in agriculture is essential to the world. We feed the world. We provide them safe and affordable food and a variety of food. And you know, minorities want to be in that process too. So I just want to end by thanking you for having this hearing and hoping that we will actually consider the legislation that we brought today. That at least that would be given a fair hearing and we think that legislation can be improved. We don't suggest that it is all, it is not our home base.
  And as Representative Thompson said, they are either, the other parts that I gather that the Secretary may recommend to us that we need further legislation. And members of this body can offer correcting and stronger amendments, but it is a beginning. It is a beginning. And I would hope that you, Mr. Chairman, will allow us to proceed with that legislation. Thank you.
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  The CHAIRMAN. I thank the lady. Are there further questions of this panel?
  Mr. THOMPSON. Mr. Chairman, let me just associate myself with the statements of Mrs. Clayton. I want to complement you for stepping out and having the leadership to hold these hearings. It is very important, at least to some of us who have a significant number of minority farmers in our district who are struggling to keep their head above water.
  And the fact that we now can get our story told to the world, is very important. And the fact that you as Chairman have not tried to bury your head in the sand on this issue. And that you are the first Chairman of this committee, since I've been on it, to at least say, we'll talk about it. And that's very important. And I applaud you for you effort to say that if budget is a problem, we'll look at it. Because in order to solve the problem, we have to have the resources to work with. So again, I thank you for your leadership.
  The CHAIRMAN. I thank the gentleman.
  Ms. WATERS. Mr. Chairman?
  The CHAIRMAN. Ms. Waters.
  Ms. WATERS. Before you close, let me just say that the Agriculture Appropriations bill is going to be up on the floor and I know that there will be some efforts to shore-up the Office of Civil Rights because they are short and they don't have enough money for the investigators and I certainly hope that we can get the support from you and this committee.
  And having said that, let me thank you again, because I don't want you to believe that in my passion I don't recognize that you didn't have to do this. I do appreciate the opportunity that has been afforded. For the ranking member, most people don't know that the ranking member and I have worked together and he supported me on an inner-city program where following the insurrection in Los Angeles we were trying to create some opportunity for young people to go to school and to get their GED's and he stepped out and gave me support and I am mindful of that, so I know we can work together.
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  And no matter what happens, I again know that the Secretary won't be able to solve this by himself. It is going to take those of you who understand how all of this works, who understands the overall community that we're dealing with and have a love for the farmers, all of them. And I want to work very closely with you and my colleagues to see if we can't help the Secretary move this burden that he's got on his shoulders. Thank you very much.
  The CHAIRMAN. All right. I thank you and while you are on the floor, help us with the peanut farmers, tobacco farmers, sugar farmers and the whole bunch. You know, we don't grow a lot of tobacco and peanuts in Oregon, but I am the No. 1 advocate for those programs to continue under the Freedom to Farm bill. So we expect your help there as well.
  Ms. WATERS. Mr. Chairman, if you ask Mr. Bishop, this lady from south central Los Angeles was voting peanuts because someone representing the farming community asked me to do it. So now I've given.
  The CHAIRMAN. No, no.
  Ms. WATERS. All right.
  The CHAIRMAN. Sorry.
  Ms. WATERS. I'm prepared to do what I can for farmers.
  The CHAIRMAN. Insufficient, sorry.
  Ms. WATERS. Mr. Chairman, it is about reciprocity.
  The CHAIRMAN. It is about what have you done for us lately.
  Ms. WATERS. All right, thank you.
  The CHAIRMAN. Further questions? Mr. Stenholm.
  Mr. STENHOLM. Mr. Chairman, you will learn, as I learned a few years ago, when to let well enough alone when you are dealing with Ms. Waters. But I want to thank my colleagues for your, not only your appearance here today, your testimony, but for the work that you have put in to helping see that today has occurred. I join in commending the chairman for the manner in which he has worked with all of us on this side on this endeavor.
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  I couldn't help but smile inside, Mr. Conyers, when you were talking about the difficulties for the Secretary. It also holds true for us, as you and I and others have found the frustrations of dealing with our Government, even as the Representatives elected by the people in that area. And it is a difficult endeavor, but it is not an impossible endeavor and in fact I suspect that is why all of us are here.
  And that's why I say to you and to my colleagues on this committee, with all sincerity, I look at this as the beginning not the end. We do have, I don't like to use the word problem. I like to use the word opportunity and substitute for problem. And I think we have an opportunity here to do some constructive work in the area of the agricultural community. And if so, it might be helpful even outside the agricultural community.
  We've always prided ourselves in, on this committee, as being leaders from the standpoint of food production, we're the envy of the world. But we do have some problems with this system that's the best in the world. And we can make it better. And I certainly, as the ranking member, look forward to rolling up my sleeves and working with you, Ms. Waters, in your official capacity and also Mr. Conyers and with the committee.
  And I know having served with my chairman, what he has said today, he says with all sincerity and I have no doubt whatsoever that this committee working together, we will see if we can't make some opportunities happen. Thank you for being here.
  The CHAIRMAN. I thank the gentleman and I thank the panel and despite one or two adjustments, you've been a very excellent audience. Thank you very much. This hearing is adjourned.
  [Whereupon, at 5:53 p.m., the committee was adjourned, subject to the call of the Chair.]
  Material submitted for inclusion in the record follows:]
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  Mr. Chairman, I would like to thank you for convening this hearing which I trust will be a detailed and effective review of the civil rights action team report.
  The Action Team and its February report was charged, if I may quote from the report's introduction; ''with developing a set of recommendations to address institutional and underlying problems and ways to implement actions to ensure accountability and follow-through at USDA.''
  Mr. Chairman, this is a virtual call for the USDA to begin a process of cleaning their house of racism and unaccountability here in Washington and at the Farm Service Agency localities throughout the Nation's heartlands.
  It is my hope that this committee and eventually Congress can act upon the calls for change encompassed in this report and finally establish an effective and long-term framework in combating racism and begin facilitating fair and efficient loans and services to all of America's farmers.
  I would also like to thank my friend and colleague, Eva Clayton of North Carolina for her work and vigilance in this matter. As you may know, Mrs. Clayton will be introducing legislation based on some of the specific recommendations from the civil rights action team report.
  However, I think she will agree with me when I say that there is a concern that on the issue of settlements in both litigated and non-litigated cases and action in investigating old discrimination complaints, USDA has been insultingly slow in bringing these issues to closure.
  Recently, top public officials, namely Virginia's Senator Chuck Robb have joined members of the Congressional Black Caucus and others in saying that USDA has been stagnant in moving to end discrimination.
  Mr. Chairman, I hope that today or in the very near future, your committee can address new concerns that the Department of Justice's Office of General Counsel may be intentionally pre-empting the authority and domain of the Assistant Secretary for Administration at USDA, Mr. Pearlie Reed and the Director of Civil Rights at USDA to solve discrimination complaints and issue compensatory damages to farmers after discrimination has been found.
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  Mr. Chairman, just as troubling is the possibility that top USDA officials are not objecting to and speaking out against such a ''power grab.'' If this is true, than such actions between justice and the USDA are orchestrated at the best, and is avoiding issuing compensation to black farmers at the worst.
  Mr. Chairman, I have been attentive and outspoken on this issue years before it gained the attention of news reports. However, my years of involvement on this issue cannot come close to the years of wait, hope and patience shown by black farmers throughout this country. Now is the time to begin the type of action which will see them wait, hope and be patient no longer.
  I hope that this hearing on the report and other issues will start the process of ending the discrimination of black farmers.
  "The Official Committee record contains additional material here."