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86–220 PDF 2003

S. HRG. 107–933

NOMINATION HEARING FOR NANCY PELLETT

HEARING

BEFORE THE

COMMITTEE ON AGRICULTURE,

NUTRITION, AND FORESTRY

UNITED STATES SENATE

ONE HUNDRED SEVENTH CONGRESS

SECOND SESSION

OCTOBER 3, 2002

Printed for the use of the

Committee on Agriculture, Nutrition, and Forestry

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Available via the World Wide Web: http://www.agriculture.senate.gov

COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY

TOM HARKIN, Iowa, Chairman

PATRICK J. LEAHY, Vermont

KENT CONRAD, North Dakota

THOMAS A. DASCHLE, South Dakota

MAX BAUCUS, Montana

BLANCHE L. LINCOLN, Arkansas

ZELL MILLER, Georgia

DEBBIE A. STABENOW, Michigan

BEN NELSON, Nebraska

MARK DAYTON, Minnesota

PAUL DAVID WELLSTONE, Minnesota

RICHARD G. LUGAR, Indiana

JESSE HELMS, North Carolina

THAD COCHRAN, Mississippi

MITCH MCCONNELL, Kentucky

PAT ROBERTS, Kansas

PETER G. FITZGERALD, Illinois

CRAIG THOMAS, Wyoming

WAYNE ALLARD, Colorado

TIM HUTCHINSON, Arkansas

MICHEAL D. CRAPO, Idaho

MARK HALVERSON, Staff Director/Chief Counsel

DAVID L. JOHNSON, Chief Counsel for the Minority

ROBERT E. STURM, Chief Clerk

KEITH LUSE, Staff Director for the Minority

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C O N T E N T S

Page

HEARING(S):

Nomination Hearing for Nancy Pellett .................................................................. 01

Thursday, October 3, 2002

STATEMENTS PRESENTED BY SENATORS

Harkin, Hon. Tom, a U.S. Senator from Iowa, Chairman, Committee on

Agriculture, Nutrition, and Forestry .................................................................. 01

Grassley, Hon. Charles E., a U.S. Senator from Iowa .......................................... 01

WITNESSES

Pellett, Nancy C., of Atlantic Iowa, to be a member of the Farm Credit

Administration Board .......................................................................................... 03

APPENDIX

PREPARED STATEMENTS:

Pellet, Nancy C. ................................................................................................ 10

DOCUMENT(S) SUBMITTED FOR THE RECORD:

Pellett, Nancy C. (biography) .......................................................................... 14

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NANCY PELLETT NOMINATION HEARING

THURSDAY, OCTOBER 3, 2002

U.S. SENATE, COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY, Washington, DC.

The committee met, pursuant to notice, at 11:05 a.m., in room

SR–328A Russell Senate Office Building, Hon. Tom Harkin, [Chairman of the Committee], presiding.

Present: Senators Harkin and Grassley.

STATEMENT OF HON. TOM HARKIN, A U.S. SENATOR FROM

IOWA, CHAIRMAN, AGRICULTURE,

NUTRITION, AND FORESTRY

The CHAIRMAN. The Senate Committee on Agriculture, Nutrition,

and Forestry will come to order.

Today, the committee welcomes a fellow Iowan, Nancy Pellett, as

a nominee for the Board for the Farm Credit Administration. I see

that she is accompanied by someone that I recognize, with whom

I am proud to work here in the Senate with on so many issues, and

rather than my making my opening statement first, I will just go

ahead and yield because I know you have probably got business to

conduct, also, Senator Grassley.

I would yield and recognize my colleague, Senator Grassley.

STATEMENT OF HON. CHARLES E. GRASSLEY, A U.S. SENATOR

FROM IOWA

Senator GRASSLEY. Mr. Chairman, I thank you very much.

I am pleased to present to you, Mr. Chairman, and to the rest

of the committee, the person who the President has nominated to

the Farm Credit Board. She is a fourth-generation Iowan.

The Farm Credit Administration, as you know, Mr. Chairman, is

responsible for ensuring safe and sound operation of banks, associations, affiliated services, and other entities that collectively comprise what is known as the Farm Credit System. FCA, for short,

is responsible for protecting the interests of the public and those

who borrow from Farm Credit institutions or invest in those Farm

Credit securities. It is very critical, for the health and well-being

of rural America, particularly for agriculture, that the Farm Credit

Administration function efficiently.

That is why I believe the President has made an excellent choice

in nominating Nancy Pellett for the position of Farm Credit Administration Board. Nancy is from a farm near Atlantic, Iowa. You

have heard me say often, Mr. Chairman, that I want this adminisVerDate 11-MAY-2000 11:33 Jun 02, 2003 Jkt 086220 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 86220.TXT SAG1 PsN: SAG1
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tration to put more people in positions of authority that have a

farm background, and specifically dirt under their fingernails.

Well, at the risk of embarrassing Nancy, I would say that she is

one of those folks. Let me tell you, she is such a person, ‘‘dirt under

the fingernail type’’ farmer, when her four children would tell you,

as I have heard them say, that they were taught their colors and

letters while Nancy was running the combine, helping her husband

in the fall harvest.

Nancy currently serves on the National Cattlemen’s Beef Board,

and she is a 14-year member of the Iowa Beef Industry Council.

She previously served, from 1988 to 1995, on the National Livestock and Meat Board, and held several leadership positions with

the National Cattlemen’s Beef Association.

She is president of Premium Quality Beef, Inc., an Iowa-based

company marketing things that you and I, Mr. Chairman, believe

in, value-added agricultural products, branded premium fresh and

pre-cooked beef products, specifically, for her agency.

She has been the vice president and secretary of Prairie Hills,

Limited, a feedlot cow, calf, and row-crop operation since 1979, and

president of Fredrechsen Farms, Limited, a swine and row-crop operation since 1977.

In addition, she brings extensive leadership beyond the agricultural sector, and I cannot name all of them, but one that we always

ought to measure Iowans by because it is very prestigious, very

outstanding, and only the best people ever get appointed to it, and

that is the Board of Regents of our State universities. She was

there 1993 to 1999; trustee of the University of Iowa Hospitals and

Clinics, 1993 to 1999; a member of the State of Iowa Student Aid

Commission, 1991 to 1993; president of the Iowa State University

Alumni Association, 1984. She graduated from the same university

you did. That ought to get her confirmed.

[Laughter.]

The CHAIRMAN. That is right.

Senator GRASSLEY. She has also served on the Iowa State University College of Agriculture and Family and Consumer Science

Advisory Board.

Let me close with this. She brings tremendous experience, valuable insight, and obviously lots of energy that is needed for an important position like the Farm Credit Administration Board. She

has demonstrated already strong leadership abilities in many capacities, in addition to her hands-on work in agriculture.

There is no doubt, at least in my mind, that the President made

a smart choice with her selection. The Farm Credit Administration

will benefit greatly from Nancy Pellett’s administration and contribution.

Thank you, Mr. Chairman.

The CHAIRMAN. Well, thank you very much, Senator Grassley, for

a great statement. I would just join with you in congratulating you,

Mrs. Pellett—Nancy Pellett—for your lifetime of service in our

State, to our university system, to education, the Extension Service, and to all of agriculture. You have been a great leader in the

State of Iowa, and I am glad that the President has recognized that

and has recommended you for this Board. I can assure you will

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have the support of all of us here to get through as soon as possible.

I have to take care of some housekeeping things. Senator Grassley, I know you have to go. Thank you very much, Senator Grassley.

This is something I have to do, but this is just part of the procedure. I have to stand, and raise the right and do all of that kind

of thing.

[Witness sworn.]

The CHAIRMAN. Thank you.

Second, do you agree that if confirmed, you will appear before

any duly constituted committee of Congress, if asked to appear?

Ms. PELLETT. I will, sir.

The CHAIRMAN. Thank you very much. I will recognize you now,

Nancy, for an opening statement, if you would like to make that

for the record. I know you have a lot of family members here. If

you would like to introduce them, we would be glad to welcome

them to the committee room here.

STATEMENT OF NANCY C. PELLETT, OF IOWA, TO BE A

MEMBER OF THE FARM CREDIT ADMINISTRATION BOARD

Ms. PELLETT. Thank you, and I would like to do that. Thank you

very much for your nice remarks, as well as Senator Grassley’s.

I am proud that all three of us can call Iowa home.

The CHAIRMAN. That is right.

Ms. PELLETT. Mr. Chairman, and other Senators of the Agriculture Committee, I appreciate the opportunity to appear before

you today. I am honored to come before you as one of President

Bush’s nominees for the Farm Credit Administration Board of Directors, but before I begin, I would like to take the opportunity to

introduce some of my family that are here today.

My husband of 36 years, Jim, and I will talk a little bit about

our operation in a minute, some of you know. I am especially happy

to have my father here, Kenneth Fredrechsen, who at age 83 is still

actively farming on the family farm.

The CHAIRMAN. That is wonderful. Where is your father? Oh,

very good. Your husband, I know.

Ms. PELLETT. The family farm is located near Walnut, Iowa, and

that is Fredrechsen Farms, Limited, that we talked about, that

Senator Grassley talked about.

My daughter Beth, who works here in Washington, DC, and her

fiance, Brian Levine; and my son Mike is here. Mike and his wife

Stacey work for John Deere.

Our oldest son, Brad, could not be here. He and his wife Kristy

just gave birth to a new little girl about 6 days ago.

The CHAIRMAN. Congratulations.

Ms. PELLETT. Thank you. Our daughter Marci, and her husband,

Andrew Loder, and their daughter Madeleine live in Spain and are

on assignment with Cargill.

I just don’t want to get too emotional during this, but I am really

extremely proud to say that we have been able, Jim and I, have

been able to pass on to our children a love of agriculture, and you

could see that from the introductions that I gave to them—a love

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of agriculture, of the land, and community, just as our parents did

to us, and we are proud of that.

My husband and I have been involved in the agriculture sector

all of our lives. We currently have a corn, soybean and cattle farm

north of Atlantic, Iowa, with our son Brad and his wife Kristy.

Since we started farming together more than 35 years ago, agriculture and rural America have changed dramatically. We are constantly looking at our operation for new and innovative ways to

adapt to the new rural America and to be sure that our children

have the opportunity to come home to the farm if they desire.

I have also been president and co-manager in a value-added company in Red Oak, Iowa. Premium Quality Foods is a value-added

provider of premium quality fresh, frozen, and pre-cooked beef

products, marketed under the Red Oak Farms and Red Oak farms

Premium Hereford beef brands.

Public service has been a huge part of our lives. From local

issues and projects, to State boards and commissions, to national

leadership positions—all have broadened my perspectives and have

given me valuable experience.

Being a member of the Iowa Board of Regents, which has governing authority over Iowa’s three State universities has given a

unique perspective to working on boards of directors. Not only did

I gain valuable experience during budgeting, but also in public policy, employment issues, and most of all in the political process.

I have also been fortunate to serve on both State and national

cattlemen boards, in both appointed and elected leadership positions. These offices and boards took me outside the confines of Iowa

into a national arena of agriculture and cattlemen issues and policies, but most importantly, in my case, in the check-off issues. The

national exposure will prove extremely beneficial to me should I be

approved for the Farm Credit Board position.

I bring a very unique perspective as a producer and a user of

credit services to the Farm Credit Administration. I also bring a

unique position of board leadership on both national and State levels. Most of all, I bring that deep passion for agriculture—families

involved in that agriculture and now that extra step of value-added

agriculture.

It is with a great deal of humility that I appear before you here

today. I share with you the vision that this committee and the

Farm Credit Administration has for families in agriculture and for

agriculture, in general, to thrive and to prosper.

If confirmed by the Senate, I look forward to serving on the Farm

Credit Administration Board of Directors, and I look forward to

working with this Agriculture Committee on future issues.

Thank you, Mr. Chairman, and I look forward to your questions.

The CHAIRMAN. Thank you, Mrs. Pellett, very much for a very eloquent statement. I, again, congratulate you on this.

I just have a couple of questions for the record.

Senator Lugar and I have focused considerable energy on a crucial issue in agriculture, the ability of young farmers to start farming. Earlier this year, the GAO released a report indicating that

the FCA could take additional measures to make sure that Farm

Credit institutions serve beginning farmers more effectively. Specifically, the report recommended that the Farm Credit AdminisVerDate 11-MAY-2000 11:33 Jun 02, 2003 Jkt 086220 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 86220.TXT SAG1 PsN: SAG1
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tration do such things as, one, promulgate a regulation that outlines specific activities and standards dealing with beginning farmers for Farm Credit institutions; and, two, publicly disclose the results of the FCA examinations concerning service to beginning

farmers.

Again, could you just share your views on the importance of serving the credit needs of young farmers and your willingness to work

with us to try to get some focus on that. Both Senator Lugar and

I have been talking about this for some time.

Ms. PELLETT. Senator Harkin, I also share your views, and those

of Senator Lugar’s, on this issue. I have a young farmer in my family, and I am well aware of the struggles it is for these young farmers to receive credit, although they are the very future of agriculture in this country. I pledge to you that I will do whatever I

can, as a Board member, and strive that the Farm Credit Administration do whatever they can to facilitate this, as well as working

with your committee.

I am a firm believer in communication and cooperation, and I

can’t believe that we in credit lending issues and so forth can’t

communicate and cooperate to make the endeavor of the young

farmer and beginning farmer a reality in this country.

The CHAIRMAN. That is great. It is something that always keeps

coming back and we certainly look forward to working with you on

that.

One last thing. You have a lot of experience in value-added businesses with which you have done down at Red Oak. Again, one of

the challenges that face the startup in rural areas is access to capital for value-added businesses.

We put some things in the Farm bill to try and get more capital

to rural areas for startup businesses and value-added businesses.

I am not certain I know exactly how the Farm Credit Administration is going to fit into this, but, again, just any thoughts you have.

I mean, did you have, did your business in Red Oak, did it get any

help from the Farm Credit System at all when it was starting up

and, if not, could it have? Could there be some changes made to

help in these areas?

Ms. PELLETT. Senator, I am aware of the struggles of a small

business value-added agriculture business with credit. I have dealt

with it every day for the last year. Our company is now 1 year old,

and it has been a struggle.

I was a Department of Economic Development meeting about 3

months ago, at which there were about 20 small companies represented in Iowa, and every one of them were dealing with credit

problems. I pledge to you that I will look with, and follow this

issue, with interest on the Farm Credit Administration Board because that is an issue in rural America, and it is one way that producers can help themselves as they get into value-added agriculture.

Marketing is a huge issue when it comes to value-added agriculture. We know how to produce, but sometimes we don’t know

how to market. I pledge, if I am confirmed, that I will follow this

issue with great interest and aggressively follow it.

The CHAIRMAN. I appreciate that because, well, the Farm bill

just got signed in May, and mostly we have been focused on getting

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it implemented for the payment structure and getting updated

bases, yields, and things like that. There are some provisions in

that farm bill that we put in over here, dealing with value-added

businesses and also a new equity capital program.

I will be honest with you, I just have not really much gotten into

how we are going to dovetail that with the Farm Credit System,

but the two could work together. At some point, I hope that we get

together with the Board, and others, to discuss ways in which, in

implementing this new equity capital provision that we have in the

Farm bill, that the Farm Credit Administration might also come in

on the credit side of it. We have one equity side, and come in on

the credit side. That could really be a real help to a lot of businesses, starting, like you said, the marketing-type businesses and

things like that that we could do.

Ms. PELLETT. It surely would be. Thank you.

The CHAIRMAN. There are a lot of things we could be doing in

agriculture that can add value, maybe new ways of doing things.

I visited a small cornfield of just a few acres up near Fort Dodge

someplace, where they are making pharmaceuticals.

Ms. PELLETT. Oh, right.

The CHAIRMAN. The problem is they are making this pharmaceutical—it is for cystic fibrosis—and they have had to do all of

these things to isolate the cornfield. It is only a couple of acres.

They have to take the grain and ship it to France because only in

France do they have the processes for storing it and taking the

pharmaceuticals out and stuff. We are working now to try to get

something at Iowa State or at the Research Park there near Iowa

State that might do the same thing.

These are things that are coming down the pike in the next few

years, and it could be a great help to a lot of young farmers in the

State of Iowa.

Ms. PELLETT. It certainly could be. There is so much opportunity

in rural America just in things like this.

The CHAIRMAN. Yes.

Ms. PELLETT. We have work ethic, we are honest, and we want

to depend on science and technology to move us ahead.

The CHAIRMAN. You need access to capital and low-cost credit in

rural areas. It has always bothered me. All of the years I have been

here, 28 years I have been on the Agriculture Committee now, and

it has just always bothered me that that farmer in Atlantic, Iowa,

Cass County, when they go to borrow money, right away they are

at a disadvantage because they have to pay more for their money

than someone that is in Chicago.

That has just always bothered me; that right away you are put

at a disadvantage. Well, that is where the Farm Credit System

comes in to try to help them out a little bit, get those interest rates

down a little bit. Whatever we can do to keep the cost of money

down for these young people and give them the same kind of advantages, we have to do.

Thank you, again, for all of your past service, and I mean that

sincerely. We may be of different political parties, but I can assure

you that I respect people who work in politics. I wish more people

would do what you have done in your past. It is an honorable thing

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to do, and I wish more people would do it. I am proud of you for

doing that. I just wish you had been on my side.

[Laughter.]

The CHAIRMAN. I am very proud of you, and take that as a very

heartfelt commendation to you for what you have done in your life,

and what you have done for the State of Iowa, and what you have

done for your party. I look forward to getting your name, we will

get it out of here, we will get it to the floor and, hopefully—we are

going to be here a couple more weeks—and then, hopefully, we will

get it out of here, and you will be on-board right away and take

over Ann’s position.

I am just proud to have a good Iowan in that position.

Ms. PELLETT. Thank you very, very much.

The CHAIRMAN. Thank you, and congratulations.

[The prepared statement of Ms. Pellett can be found in the appendix on page 10.]

The CHAIRMAN. The committee will stand adjourned.

[Whereupon, at 11:24 a.m., the committee was adjourned.]

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A P P E N D I X

OCTOBER 3, 2002

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DOCUMENTS SUBMITTED FOR THE RECORD

OCTOBER 3, 2002

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