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IS USDA ACCOUNTING FOR COSTS TO FARMERS

CAUSED BY CONTAMINATION FROM GENETICALLY ENGINEERED PLANTS?

HEARING

BEFORE THE

SUBCOMMITTEE ON DOMESTIC POLICY

OF THE

COMMITTEE ON OVERSIGHT

AND GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED TENTH CONGRESS

SECOND SESSION

MARCH 13, 2008

Serial No. 110–165

Printed for the use of the Committee on Oversight and Government Reform

(

Available via the World Wide Web: http://www.gpoaccess.gov/congress/index.html

http://www.oversight.house.gov

(II)

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

HENRY A. WAXMAN, California, Chairman

EDOLPHUS TOWNS, New York

PAUL E. KANJORSKI, Pennsylvania

CAROLYN B. MALONEY, New York

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

DANNY K. DAVIS, Illinois

JOHN F. TIERNEY, Massachusetts

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

STEPHEN F. LYNCH, Massachusetts

BRIAN HIGGINS, New York

JOHN A. YARMUTH, Kentucky

BRUCE L. BRALEY, Iowa

ELEANOR HOLMES NORTON, District of

Columbia

BETTY MCCOLLUM, Minnesota

JIM COOPER, Tennessee

CHRIS VAN HOLLEN, Maryland

PAUL W. HODES, New Hampshire

CHRISTOPHER S. MURPHY, Connecticut

JOHN P. SARBANES, Maryland

PETER WELCH, Vermont

——— ———

TOM DAVIS, Virginia

DAN BURTON, Indiana

CHRISTOPHER SHAYS, Connecticut

JOHN M. MCHUGH, New York

JOHN L. MICA, Florida

MARK E. SOUDER, Indiana

TODD RUSSELL PLATTS, Pennsylvania

CHRIS CANNON, Utah

JOHN J. DUNCAN, JR., Tennessee

MICHAEL R. TURNER, Ohio

DARRELL E. ISSA, California

KENNY MARCHANT, Texas

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

VIRGINIA FOXX, North Carolina

BRIAN P. BILBRAY, California

BILL SALI, Idaho

JIM JORDAN, Ohio

PHIL SCHILIRO, Chief of Staff

PHIL BARNETT, Staff Director

EARLEY GREEN, Chief Clerk

LAWRENCE HALLORAN, Minority Staff Director

SUBCOMMITTEE ON DOMESTIC POLICY

DENNIS J. KUCINICH, Ohio, Chairman

TOM LANTOS, California

ELIJAH E. CUMMINGS, Maryland

DIANE E. WATSON, California

CHRISTOPHER S. MURPHY, Connecticut

DANNY K. DAVIS, Illinois

JOHN F. TIERNEY, Massachusetts

BRIAN HIGGINS, New York

BRUCE L. BRALEY, Iowa

DARRELL E. ISSA, California

DAN BURTON, Indiana

CHRISTOPHER SHAYS, Connecticut

JOHN L. MICA, Florida

MARK E. SOUDER, Indiana

CHRIS CANNON, Utah

BRIAN P. BILBRAY, California

JARON R. BOURKE, Staff Director

(III)

C O N T E N T S

Page

Hearing held on March 13, 2008 ............................................................................ 1

Statement of:

Howington, Harvey, conventional and GE grain grower, Lepanto, AR;

Todd Leake, conventional and GE grain grower, Emerado, ND; Don

Cameron, conventional, organic and GE crop grower, Helm, CA; Fred

Kirschenmann, organic grain grower, Medina, ND; Colin Carter, Ph.D.,

agricultural economist, University of California, Davis; and Ray Clark,

the Clark Group LLC, Washington, DC ...................................................... 12

Cameron, Don ............................................................................................ 28

Carter, Colin .............................................................................................. 45

Clark, Ray .................................................................................................. 55

Howington, Harvey ................................................................................... 12

Kirschenmann, Fred ................................................................................. 36

Leake, Todd ............................................................................................... 19

Smith, Cindy, Administrator, Animal and Plant Health Inspection Service, U.S. Department of Agriculture, accompanied by Michael Gregoire,

Deputy Administrator for Biotechnology Regulatory Services, Animal

and Plant Health Inspection Service, U.S. Department of Agriculture ... 76

Letters, statements, etc., submitted for the record by:

Cameron, Don, conventional, organic and GE crop grower, Helm, CA,

prepared statement of ................................................................................... 31

Carter, Colin, Ph.D., agricultural economist, University of California,

Davis, prepared statement of ....................................................................... 48

Clark, Ray, the Clark Group LLC, Washington, DC, prepared statement

of ..................................................................................................................... 59

Howington, Harvey, conventional and GE grain grower, Lepanto, AR,

prepared statement of ................................................................................... 14

Kirschenmann, Fred, organic grain grower, Medina, ND, prepared statement of ........................................................................................................... 38

Kucinich, Hon. Dennis J., a Representative in Congress from the State

of Ohio:

Letter dated September 16, 2008 ............................................................. 99

Memo dated May 31, 2005 ........................................................................ 108

Prepared statement of ............................................................................... 4

Leake, Todd, conventional and GE grain grower, Emerado, ND, prepared

statement of ................................................................................................... 21

Smith, Cindy, Administrator, Animal and Plant Health Inspection Service, U.S. Department of Agriculture, prepared statement of .................... 79

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IS USDA ACCOUNTING FOR COSTS TO FARMERS CAUSED BY CONTAMINATION FROM

GENETICALLY ENGINEERED PLANTS?

THURSDAY, MARCH 13, 2008

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON DOMESTIC POLICY,

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM,

Washington, DC.

The subcommittee met, pursuant to notice, at 2:13 p.m., in room

2247, Rayburn House Office Building, Hon. Dennis J. Kucinich

(chairman of the subcommittee) presiding.

Present: Representatives Kucinich and Issa.

Staff present: Jaron R. Bourke, staff director; Jean Gosa, clerk;

Jim Moore, minority counsel; Larry Brady, minority senior investigator and policy advisor; Benjamin Chance, minority clerk; and

Chris Espinoza, minority professional staff member.

Mr. KUCINICH. The committee will come to order.

This is a meeting of the Domestic Policy Subcommittee of the

Oversight and Government Reform Committee. I am Dennis

Kucinich, Chairman of the committee. Congressman Darrell Issa is

the ranking minority member.

The hearing title today ‘‘Is the USDA Accounting for Costs to

Farmers Caused by Contamination from Genetically Engineered

Plants?’’ We have a rather lengthy witness list. What I am going

to do is read an opening statement, then defer to my colleague Mr.

Issa. It is quite possible votes are going to be called, and in that

case we will recess for votes, and then we will come back and continue.

Contamination of conventional crops by genetically engineered

[GE] plants can occur in several ways. They can pollinate non-genetically engineered plant species by wind or insects. They can

grow as ‘‘volunteers’’ from seed that was unintentionally left in soil

from a previous growing season. Or they can be mixed together

with nongenetically engineered products in the harvesting, handling, distribution, and/or food processing systems. When genetically engineered plants contaminate the crops of conventional and

organic farmers, the farmers pay a heavy price.

Today’s hearing will not be about whether GE crops are ‘‘good or

a bad’’ thing. Today’s hearing is about whether the chief regulator

and advocate for the farmers, USDA, and its subagency, the Animal and Plant Health Inspection Service [APHIS], is taking into

account the cost to farmers and realities of contamination risk by

the GE plants it regulates.

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In 2000, America’s corn farmers faced a sudden collapse of international and domestic demand for all varieties of U.S. corn. Prices

fell considerably when genetically engineered StarLink corn was

detected in taco shells by a private laboratory. StarLink had been

approved for commercial use by APHIS, though limited to animal

feed by the Environmental Protection Agency. Japan temporarily

halted imports of U.S. corn. One of our witnesses estimated that

the short-term cost to farmers was $500 million. A class action suit

was settled for $110 million against the manufacturer of StarLink.

In 2006, America’s rice farmers faced a sudden collapse of international demand for U.S. rice. Prices fell considerably when experimental genetically engineered LibertyLink was detected in the

commodity rice supply by a foreign customer. APHIS investigated—over 7 months after the contamination was first detected—and concluded that the contamination originated at a field

test plot in Louisiana. However, APHIS never determined how the

contamination occurred. APHIS took no enforcement action, and,

on its own initiative, deregulated LibertyLink rice after the contamination event. One of our witnesses today is an affected grower

of conventional rice.

Two-and-a-half weeks ago, APHIS announced another contamination event, this time involving a genetically engineered corn variety called ‘‘Event 32.’’ USDA’s press release indicates that the

cause of the contamination was the sale to farmers of contaminated

seed, and that 53,000 acres of contaminated seed were planted in

2007.

According to APHIS, contamination events are rare. But it is unclear if this is accurate. Not a single government agency detected

the contamination in any of these events. This is not surprising because the Federal Government doesn’t test for crop contamination.

We only know about crop contamination when private actors discover it by testing and decide to report it to the public. Sometimes

contamination that is discovered by them is not reported.

APHIS is supposed to play a role in preventing contamination.

But when the Inspector General, in 2005, published its audit of

APHIS’s controls over the issuance of permits for field testing of genetically engineered plants, it found, ‘‘APHIS had little assurance

that field tests are being conducted safely, in a way that minimizes

the potential for GE plants to persist in the environment.’’ In all,

the Inspector General made 28 recommendations to APHIS. APHIS

eventually agreed to corrective action on each of the recommendations.

The National Environmental Policy Act of 1969 [NEPA], requires

APHIS to analyze and report in Environmental Impact Statements

[EIS] significant environmental impacts and any related economic

impacts of decisions to deregulate or field test genetically engineered crops. APHIS has approved 13,500 field tests for GE crop

varieties, occurring at more than 79,000 sites around the country,

and has also deregulated more than 70 GE plant varieties. Yet

APHIS has initiated only four environmental impact studies, all of

them in the past year or so. One of them was ordered by a Federal

court.

According to APHIS, the reason for the small number of environmental impact studies, in contrast to thousands of notifications,

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permits, and deregulations it has issued, is that in nearly all cases

APHIS determined that its proposed action did not have a significant impact as defined by the National Environmental Policy Act.

However, two recent Federal court judges, reviewing APHIS’s determination of, ‘‘no significant impact,’’ for proposed agency actions

related to two genetically engineered plants, Roundup Ready alfalfa and creeping bentgrass, found that APHIS had acted in an arbitrary and capricious manner, APHIS’s determination was inconsistent with the National Environmental Policy Act, and APHIS

violated the act.

In a Federal court decision, Geertson Seed Farms v. Johanns, the

judge found that APHIS violated the National Environmental Policy Act by failing to account for the potential economic impact that

would result from contamination of non-GE alfalfa by Roundup

Ready alfalfa. The court ruled that APHIS had an obligation to

evaluate economic costs stemming from a genetic contamination because they were so closely related. The Federal court concluded

that the economic effects on the organic and conventional farmers

of the government’s deregulation decision are a direct result of the

transmission of the genetically engineered gene to organic and conventional alfalfa. APHIS was required to consider those effects in

assessing whether the impact of its proposed action is significant.

Today’s hearing will focus on where APHIS goes from here. How

will APHIS incorporate the guidelines provided by these judicial

decisions in reforming the way it regulates the GE crop industry?

Will APHIS account for the economic impact on farmers caused by

GE plant contamination? Will APHIS take seriously the National

Environmental Policy Act’s recommendations to produce environmental impact statements that analyze environmental impacts and

related economic impacts.

Now is the time to pose these questions and conduct oversight.

In the wake of these two significant judicial rebukes, the USDA is

in the process of overhauling both its GE crop and National Environmental Policy Act regulations.

I thank you very much.

[The prepared statement of Hon. Dennis J. Kucinich follows:]

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Mr. KUCINICH. The Chair recognizes Mr. Issa.

Mr. ISSA. Thank you, Mr. Chairman. And thank you for holding

this hearing on two important subjects, one clearly within the purview of this committee, one perhaps not within the purview of this

committee, but certainly worthwhile discussing here today.

I am always pleased when the Committee on Government Oversight and Reform deals with the question of whether or not the administration is properly adhering to laws passed by the Congress

and regulations often created by the administration or passed the

administration themselves. Clearly, today that is the focus of this

hearing.

I appreciate the fact that genetically modified plants have and

continue to be a lively discussion around the world. When I was

first elected to Congress in the year 2000, one of the first trips I

took was to Europe, and to discover that the Europeans were not

just objecting to GMOs in Europe, but actually objecting to the

United States giving away free food in Africa if it was the product

of GMOs. I found that amazing then; I find it amazing now.

I believe that, in fact, we must try to find better crops for better

feeding of the people of the world, and a reduction in erosion and

other problems caused by conventional plants.

I might note that contamination is not limited to one crop versus

another. In my own home in California, we have been struggling

for decades with the glassy-winged sharpshooter, which would not

be passing on Pierce’s disease for our wine industry and grapes and

raisins if it were not for the fact that we are also a citrus producer.

The glassy-winged sharpshooter lives in mass quantities without

significant damage to oranges, so they make a perfect breeding

ground. Unfortunately, oranges and our grape vines often grow

close together, and we have been struggling trying to find a way

to have those two crops, clearly historic crops, but crops, not be

damaged by their collocation. Additionally, California has often

been unfairly told by the Japanese that, in fact, our long-grain rice

or even California short grain, is somehow indigestible by the Japanese, clearly a protectionist maneuver, and not a legitimate complaint about the quality of what we grow in California.

Having said that, we also know that many naysayers suggest the

world is running out of space to produce the world’s food supply.

I agree that if we cannot get past the 6 billion-plus today, and we

get to 12 billion, we will have to produce more food in less space.

So, then, why would anyone argue against GM advancements that

promise increased yield per acre?

The International Service for the Acquisition of Agri-biotech Applications, the ISAAA, shows that in 2006 the number of hectares

globally cultivated with GM crops increased by 12 million hectares.

More importantly, that doubled the amount of food produced on

those same hectares.

Many argue that pesticides harm our health. I agree. If you believe this, you must ask the question of why would you not want

to have improved crops that need less pesticides? The National

Center for Food and Agriculture Policy, the NCFAP, concludes in

2004 alone, biotechnology in the United States reduced pesticide

use by 34 percent. If soil and water conservation is of concern to

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you, then how could you argue against biotech crops which reduce

soil erosion and reduce water storage and treatment needs?

The Conservation Technology Information Center reports an increase of no-till acreage farmland due to biotech agriculture reduces soil erosion by 1 billion tons per year. Now, I might note

Speaker Pelosi used Federal funds allocated by the House of Representatives to buy carbon credits that were produced by no-till agriculture.

If you believe the growing trade deficit is a problem worth addressing, then how can you argue that curtailing the agriculture

community’s ability to increase exports somehow serves that purpose? Ag Secretary Ed Schafer announced this week that exports

are forecasted to reach a record $104 billion in fiscal year 2008, up

$10 billion from November’s forecast, and $19 billion from 2007.

Today Don Cameron, a California grower, will tell us exactly how

he is able to balance conventional, organic and biotech crops, reaping economic and environmental benefits for all. Mr. Cameron is

proof that the use of these new technologies properly can, in fact,

allow them to harmoniously work together.

There is a risk. I am here today to say that the government has

an obligation to oversee that risk, to constantly monitor it, because,

in fact, our food supply is too important not to have the USDA and

other Federal agencies adhering to acts of Congress and their own

regulations.

So, Mr. Chairman, I look very much forward to this oversight

hearing because I do believe that Congress has an absolute oversight responsibility, and I congratulate you for focusing on that

today and yield back.

Mr. KUCINICH. I thank the gentleman from California.

Without objection, Members and witnesses will have 5 legislative

days to submit a written statement or extraneous materials for the

record.

Again, for those who have just joined us, today’s hearing will not

be about whether GE crops are good or bad. Today’s hearing is

going to be about whether the chief regulator and advocate for the

farmers, USDA, and its subagency, the Animal and Plant Health

Inspection Service [APHIS], is taking into account the cost to farmers and realities of contamination risk by the GE plants it regulates.

Now, there are no additional opening statements. The subcommittee will receive testimony from the witnesses before us

today. I want to start by introducing our first panel. Mr. Harvey

Howington jointly owns a family farm operation with his parents.

Until 2006, Mr. Howington farmed 1,200 acres on 3 tracts of land

near Lepanto, AR. The farming operation consisted of 500 acres of

rice, 700 acres of Roundup Ready soybeans. After the LL601 contamination event in 2006, he decided to quit farming and now rents

his farmland to neighboring farmers. He is vice president of the Arkansas Rice Growers Association, and a member of the board of directors of the U.S. Rice Producers Association. From 2002 to 2003,

he was president of the Arkansas Seed Growers Association, and

remains on its board of directors.

Mr. Todd Leake——

Mr. LEAKE. Leake.

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Mr. KUCINICH [continuing]. Leake is a family farmer from

Emerado, ND. Mr. Leake annually grows approximately 1,000

acres of wheat, and approximately 500 acres of soybean and 500

acres of navy bean and sunflower. Since 2000, Mr. Leake has been

involved in policy issues surrounding the development and potential deregulation of genetically modified wheat.

Mr. David Cameron owns and farms Prado, is it? I am sorry.

Mr. ISSA. Don Cameron.

Mr. KUCINICH. Strike that, I am sorry. Mr. Don Cameron owns

and farms is it Prado?

Mr. CAMERON. Prado.

Mr. KUCINICH. Prado. Owns and farms Prado Farms located in

Fresno County, CA. Since 1981, he has been the vice president and

general manager of the Terranova Ranch, Inc., and farms approximately 5,500 acres of conventional, organic, and biotech crops ranging from organic pima cotton, biotech corn and alfalfa, along with

a diversity of other annual crops.

Mr. Fred Kirschenmann farms 3,500 acres of certified organic

crops in North Dakota. His family farm was certified in 1980, making it one of the early operations to make the transition. He is also

a distinguished fellow for the Leopold Center for Sustainable Agriculture at Iowa State University. Mr. Kirschenmann holds a Ph.D.

from the University of Chicago, and has written extensively about

ethics in agriculture. He has also held national and international

appointments, including the USDA’s National Organic Standards

Board.

Professor Colin Carter was born and raised on a farm in Alberta,

Canada. He obtained a Ph.D. in agricultural economics from the

University of California Berkeley in 1980. Professor Carter is currently professor of agriculture and resource economics at the University of California Davis. He has published more than 120 research papers, authored or edited 15 monographs and books, and

contributed dozens of chapters to books. He has published in areas

of international trade, agricultural policy, futures and commodity

markets, and economics of China’s agriculture, and the economics

of biotechnology adoption in agriculture. Professor Carter was

named fellow of the American Agricultural Economics Association

in 2000 in recognition of his many contributions to the field of agricultural economics.

Finally, Mr. Ray Clark is a National Environmental Policy Act

expert, with more than three decades of environmental management experience. As Associate Director of the Council on Environmental Quality, he implemented the Council’s mandate for oversight of the National Environmental Policy Act, reviewed and approved Federal agency regulations with respect to that act, and mediated interagency disputes regarding compliance. As Acting Assistant Secretary of the Army for Installations and Environment,

and Principal Deputy Assistant Secretary of the Army, he was responsible for over 14 million acres of land. As an adjunct faculty

member at Duke University, Mr. Clark develops NEPA courses and

teaches at the Nicholas School of the Environment.

I want to thank all the witnesses for being present, appearing before this subcommittee today. It is the policy of the Committee on

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Oversight and Government Reform to swear in all witnesses before

they testify. I would ask that you rise and raise your right hands.

[Witnesses sworn.]

Mr. KUCINICH. Let the record reflect that the witnesses answered

in the affirmative.

I will now ask that we begin. I want to give the first witness an

opportunity to get his testimony in, and then I am going to have

to recess to go to vote, and I will be back.

Mr. Howington, I ask that you give a brief summary of your testimony, to keep the summary to 5 minutes in duration. Your entire

written statement—this goes to all the witnesses—even though I

ask you keep your testimony to 5 minutes, your entire written

statement will be included in the record of this hearing. So Mr.

Howington, if you would begin.

STATEMENTS OF HARVEY HOWINGTON, CONVENTIONAL AND

GE GRAIN GROWER, LEPANTO, AR; TODD LEAKE, CONVENTIONAL AND GE GRAIN GROWER, EMERADO, ND; DON CAMERON, CONVENTIONAL, ORGANIC AND GE CROP GROWER,

HELM, CA; FRED KIRSCHENMANN, ORGANIC GRAIN GROWER, MEDINA, ND; COLIN CARTER, PH.D., AGRICULTURAL

ECONOMIST, UNIVERSITY OF CALIFORNIA, DAVIS; AND RAY

CLARK, THE CLARK GROUP LLC, WASHINGTON, DC

STATEMENT OF HARVEY HOWINGTON

Mr. HOWINGTON. I would like to thank the Chair, Representative

Kucinich; the ranking member, Representative Issa; and the members of the subcommittee for the opportunity to speak on this matter of great importance to American farmers. This is my first time

to testify before Congress, and it is an honor to be here.

By far and away the most important title I have is father. The

greatest gift I have to pass on is the family farm legacy. I am here

today to talk to you about a serious threat to that legacy.

I grow GMO crops. Unfortunately, consumer acceptance for all

GMO crops is not universal. Rice is the least accepted of all GMO

crops. As farmers, we have to grow products consumers want and

try to do it at a profit.

In early August 2006, farming was looking pretty good. We had

a good crop, and prices were headed up. Then on August 19, 2006,

USDA announced Bayer’s LibertyLink LL601, a herbicide-tolerant,

genetically engineered variety, had been found in non-GMO rice. At

the time LL601 had not been approved for human consumption.

Reaction was immediate. Japan banned importation of all longgrain U.S. rice. The European Union imposed strict testing requirements on all U.S. rice shipments. That had the effect of stopping

all sales to that market. In the 7 days following the announcement,

the American rice crop lost $168 million in value, with the futures

price dropping from $9.83 a hundredweight to $8.99 a hundredweight.

At the time of the contamination event, global rice prices, supplies were becoming increasingly tight, and the futures price was

tracking upward. It is not inconceivable that rice prices approaching $12 a hundredweight could have been realized had it not been

for the contamination event. Even if you don’t include this loss in

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price potential, based on a conservative estimate calculated by the

USRPA, the U.S. rice industry loss $1.2 billion due to this contamination event. That figure is consistent with the findings of Dr. Neal

Blue, an agricultural economist at Ohio State University.

Farmers were in a quandary. Is my rice contaminated? Can I sell

it if it is? What sort of price hit am I going to take? And that was

just the rice just harvested. What to plant next year? What varieties are going to be available? Is the seed going to be safe? How

much more is the seed going to cost me? What is testing going to

cost me? What tests should I have? At what level should it be tested? Are the fields planted in rice last year going to be contaminated this year?

Through all this ordeal the LL601 contamination event caused,

three questions remained at the forefront of the minds of rice farmers: How did the contamination occur? Who is responsible? How did

it get so widespread before detection occurred?

One thing is perfectly clear. These answers will not be forthcoming from the USDA, whose mandate it is to administer, manage

and monitor field trials to ensure that contamination events don’t

occur. In that regard, the Agency has failed miserably. After spending 8,500 staff hours conducting their investigation, they did not

answer a single one of these questions. No enforcement action was

taken against Bayer, or anyone else for that matter.

I listened to the USDA’s findings on a conference call. It was

very difficult listening to the USDA say they didn’t know who, they

didn’t know how, and it happened so long ago we can’t do anything

about it even if we did. This is not an isolated incident. The LL601

event resulted in a decision to leave farming for many rice producers. Nearly 600 rice farms were lost between 2006 and 2007. While

not all quit because of LL601, it had to be a major factor. The impact on local rural economies cannot be calculated.

The USDA needs to conduct more comprehensive environmental

analysis before embarking on field trials that pose major economic

threats to an agriculture industry or commodity. The decisionmaking process needs to be more transparent, with an opportunity

for farmers to speak and be heard. And most importantly, the burden must be placed on the biotech company to demonstrate how

contamination will be prevented in the farming industry.

I appreciate this opportunity. Your efforts to help solve this problem are sincerely appreciated by all the rice farmers I represent

here today. I will be happy to answer any questions as best I can.

Mr. KUCINICH. Thank you very much, Mr. Howington.

[The prepared statement of Mr. Howington follows:]

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Mr. KUCINICH. We are going to recess right now. There are two

votes on. I think that means that I could be back here in 20 minutes at the earliest. So if we all—I ask all the witnesses don’t go

too far, but we have about 20 minutes. And so the committee is in

recess, and we will resume testimony with Mr. Leake when we return. Thank you.

[Recess.]

Mr. KUCINICH. The committee will come to order. We are going

to resume the testimony here with Mr. Leake. Thank you very

much for your patience. Let’s resume. Thank you.

STATEMENT OF TODD LEAKE

Mr. LEAKE. I would like to thank the Chair, Representative

Kucinich; and the ranking member, Representative Issa; and the

members of the committee for the opportunity to testify on this

matter.

My name is Todd Leake. I own and operate a family farm near

Emerado, North Dakota. I farm 2,000 acres, half of that to wheat.

North Dakota is the Nation’s No. 1 producer of wheat. The crop is

critical to our economy and the communities that we support.

Because wheat is so critical to my livelihood, I became concerned

when it was revealed in 1999 that North Dakota State University

and other ag universities in the region were developing genetically

engineered wheat. The basis of my concern was that since the introduction of GE corn, soybeans, and canola in 1996, many of our

largest consistent market countries had enacted restrictions or

moratorium on the importation of GE crops.

In 2002, U.S. Wheat Associates conducted a survey that concluded that, ‘‘buyers in Japan, the EU and Korea have repeatedly

and definitively stated that they would not accept genetically modified wheat at any tolerance.’’ These three countries accounted for

44 percent of hard red spring wheat exports. Also in 2002, USDA

Foreign Ag Service assessed the information compiled in overseas

branch offices regarding buyer attitudes and governmental regulations of GE crops. The findings provided further support to the conclusions contained in the U.S. Wheat Associates surveys. Of the top

10 U.S. wheat-importing countries, all had laws regarding the importation of GE crops.

During that same period, a study of the impact of commercialization of GE wheat was undertaken by Dr. Rob Wisner of Iowa State

University, one of the country’s most respected agriculture economists. Dr. Wisner’s report concluded that if GE wheat were commercialized, U.S. wheat growers would lose between 43 and 52 percent of their total exports, resulting in a net loss of between 32 and

35 percent of the income from that crop. To my farming operation

this would clearly result in growing wheat at a loss.

Even with it firmly established the production of GE wheat

would be an economic disaster for wheat producers nationwide, research into GE wheat continued unabated. All the major agricultural universities in the region conducted and contracted research

and field testing of GE wheat at their extension research centers.

Great media attention was paid to the issue of cross-pollination of

GE wheat with the breeder stock and the foundation stock also

grown at the extension centers. Those breeder and foundation

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stocks are the basis from which all future wheat varieties grown

in North Dakota are derived.

When Monsanto Corp. petitioned for the deregulation of their

Roundup Ready GE wheat, concerns were escalated over the possibility of widespread GE contamination or adventitious presence of

GE wheat in the commercial wheat supply as commercialization

came one step closer to reality. Farmers and grain buyers alike

knew that the segregation would be impossible, that cross-pollinating seed would be spread by machinery. Research from the University of Manitoba predicted that the commercial wheat crop would

be contaminated beyond the limits of the importation tolerances of

the major importing countries within 5 years.

Between 2001 and 2004, farm group leaders had conversations

with USDA/APHIS. When informal discussions failed to produce an

agreement on the need for an EIS on GE wheat deregulation, farmers and farmer groups signed a formal petition requesting an EIS

be conducted.

In March 2004, accompanied by our legal representatives, Dr.

Robert Wisner and other wheat growers and grain merchandisers

and farm group leaders, I met with Under Secretary Bill Hawkes

and the Acting Director for APHIS on the issue of an EIS on

Roundup Ready GE wheat deregulation petition. Ultimately, despite our concerns, our request was denied.

This issue did not end there. Because of the deregulation petition

pending before USDA, grain companies from other countries restricting the importation and use of GE wheat began accessing

their supplies elsewhere than the United States, in particular from

the former Soviet Republics in the Black Sea region. Citing market

concerns of nonacceptance, Monsanto shelved its Roundup Ready

wheat program in May 2004 and pulled their deregulation at

APHIS shortly thereafter.

While I applaud Monsanto’s ultimate decision to pull the Roundup Ready wheat deregulation petition based on the sensitivity of

the international GE marketing issue, I feel that it should not have

been left solely as a corporate decision. The environmental contamination issues and the economic loss issues were clearly within

the purview of USDA. These should be addressed under the National Environmental Policy Act. This would allow farmers like myself, who would pay the price for GE contamination, the opportunity to be heard in that process. Thank you.

[The prepared statement of Mr. Leake follows:]

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Mr. KUCINICH. Mr. Cameron, you may proceed. Thank you.

STATEMENT OF DON CAMERON

Mr. CAMERON. Thank you, and good afternoon, Mr. Chairman.

Thank you for providing me the opportunity to share with you and

this distinguished subcommittee my experience as a farmer who

grows both organic and biotech crops on my farm.

My name is Don Cameron. I am general manager of Terranova,

a diversified farming operation located in Fresno County’s San Joaquin Valley. At Terranova we farm approximately 26 different

crops, including cotton, alfalfa, tomatoes, carrots, garlic, on nearly

5,500 acres.

On our farm we grow organic, conventional, and biotech crops.

About 10 percent of our overall production is grown for organic

markets, including organic cotton and alfalfa. The remaining 90

percent of the farming at Terranova is a combination of conventional farming practices and crops derived from agricultural biotechnology, which includes biotech cotton, corn, and alfalfa. Our

farming operation is living proof that organic and biotech farming

practices can coexist in near proximity without one negatively impacting the other.

Over the last decade, millions of acres of biotech crops have been

grown in the United States which coexist with organic crop production. In fact, the growth of agricultural biotechnology has been accompanied by a surge in both organic acreage and profits derived

from the organic production in this country. Indeed, organic farming has been a profitable component of our farming operation.

What is true for farmers across the United States is also true for

me; namely, that farming is a business. Like good businesspeople,

we seek to be good stewards of our land while maximizing the opportunities in the marketplace. When we determine each year what

crops will be planted, we look at all aspects of each potential crop

from expected price, yield, crop rotation, income, expense ratios,

and whether we can compete on a global basis with other countries.

We have chosen to specialize in organic farming on a portion of our

farm to increase diversity and fill a niche in the marketplace. The

risk is much higher in organic farming due to the lack of effective

treatments for various insects, diseases, and weed problems. We

have accepted the risks with the potential for increased profitability. Most insecticides, herbicides, fungicides, and commercial

fertilizers are eliminated in organic farming. Hand weeding with

contracted labor is our major expense.

Organic farming is a process we have chosen to put in place on

a portion of our farm. On the remainder of the farm, we chose to

farm with conventional techniques. We use modern technology,

with advanced practices, including GPS tractors, plant mapping,

integrated pest management, and irrigation management. We also

use biotech seed varieties when available for corn, cotton and alfalfa.

The trait we find most useful is the Roundup Ready trait, which

allows the plant to resist herbicide Roundup or glyphosate. Why is

this so important to us? Because our economic savings that we realize through the use of the Roundup Ready system have been tremendous. Compared to conventional crops, Roundup Ready alfalfa

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saves us about $110 per acre, Roundup Ready cotton $165 per acre,

and Roundup Ready corn $17 per acre. These savings include the

reduction of overall chemical use on our farm, reduced labor costs,

and fewer trips across the fields with tractors, which conserves our

farm equipment and reduces diesel use, along with emissions and

dust particles released into the environment. If we were comparing

Roundup Ready weed costs with weed control from our organic production, the savings would be even greater.

To elaborate on that point, here in the United States our labor

costs are expensive because we provide a fair wage, safe working

conditions, and insurance benefits for our workers. To hand-weed

organic crops, I have spent up to $2,000 per acre, as there was no

alternative available. This is not an effective use of a dwindling

supply of labor. With Roundup Ready crop, my total weeding bill

is less than $35 per acre. My crop is clean and free of weeds. For

the American farmer and for me to compete in a world marketplace

where labor elsewhere may only cost $1 per day, we need technologies like this to remain competitive.

I believe that the flexibility that biotechnology can provide is a

major reason that I can successfully grow the variety of crops that

we do. The Roundup Ready cropping system leaves no chemical

residue that will interfere with the following crops. In the past, we

would use herbicides that had long residuals in the soil, which

would preclude the planting of sensitive crops following their use.

We now have the flexibility to change crops rapidly with major

changes in the markets without risk from previous herbicide applications.

I am always asked how we keep pollen flow from one type of

farming operation from interfering with the other. We grow many

crops for their seeds, both organic and conventionally, and each one

is different. We have been dealing with these issues long before the

advent of biotechnology crops. If farmers were not successful with

this, there would be only one color of corn, one variety of melon,

and one type of cotton. We know the biology of each crop we grow,

where we need to grow it to maintain and preserve its integrity

and its identity. We maintain necessary separation when needed,

especially in seed production. In some cases there is no interaction,

and in other cases there may be, but we know when to anticipate

the interaction and separate the varieties according to their characteristics. We clean our planters, harvesters, bins and trucks to

maintain this purity, the same way we separate our organic from

our nonorganic or our biotech crops. We talk with our neighbors,

we communicate, we work out the issues that may arise. We are

also required by our commercial contracts to provide a crop that is

virtually free of other varieties, be it biotech to organic or organic

to conventional. We maintain separation to ensure this does not

happen.

On our farm we consistently maintain a higher level of standards, which exceed the National Organic Standards, to fulfill contract requirements from our buyers. In all my years of farming, I

have never lost a market nor income because I grow organic, conventional or biotech varieties on my farm. In short, we were coexisting long before the term was coined.

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It is my hope that the United States will remain competitive, and

that our Nation’s leaders will provide the foresight to keep us in

the forefront of modern agriculture production for many years to

come. As an American, I do not want to rely on another country

for my food and fiber supply. We are the most productive Nation

in the world in agriculture, and we need the tools to remain leaders. I know we can grow organic and biotech crops without one

jeopardizing the other. I know this because I have been doing it

successfully on our farm over the last decade.

Thank you again for the opportunity to share my views. I look

forward to answering any questions you may have. Thank you.

Mr. KUCINICH. I thank the gentleman.

[The prepared statement of Mr. Cameron follows:]

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Mr. KUCINICH. I just would like to remind the witnesses if they

could try to keep their testimony to within 5 minutes to help us

facilitate this. Thank you very much.

OK. Mr. Kirschenmann.

STATEMENT OF FRED KIRSCHENMANN

Mr. KIRSCHENMANN. Yes. Thank you. And thank you for inviting

us to this hearing.

I would like to add just three observations to those that have

been made by my farmer colleagues, and they are all based on our

experience on our own farm, farming organically for the last 30

years.

The first observation is that there is perhaps not a misconception, but a misappropriation of information within USDA regarding

whether or not organic farmers are harmed in the marketplace by

contamination. And USDA quite correctly points out that organic

certification is based on a process certification; that is, our product

is not routinely tested to find out if there is contamination. We are

simply inspected and certified to make sure that we don’t use

transgenic technologies in our production system, and that is what

is meant by process certification.

The problem is that while that is true, there are increasingly

people in the organic market who buy our products who are not

satisfied with simply the fact that we are certified organic. They,

in fact, do their own testing because they know that their consumers are not just concerned about whether we use the technology on

our farms, but they simply don’t want the GMO in their food. And

so increasingly now the customers that we sell to are routinely

testing. They have very sophisticated laboratories, and they test to

the lowest possible degree that technology allows. And if there is

contamination, they simply reject the product.

To give you a case in point, we sell virtually all of our organic

Durham wheat to Eden Foods, and Eden Foods is one of those companies that feel that they have a covenant with their customers

that they do not want to violate, and so they guarantee to their

customers that when they buy their organic pasta, that there are

no GMOs in that pasta, and so they routinely test. And I have been

to their plant, I have seen their laboratory. It is very sophisticated,

uses the most recent technology and science. And I have seen the

records of rejecting loads of soybeans when they were delivered

when they had small levels of contamination. And, of course, the

farmers then had no choice but to take the load back. And, of

course, as you can imagine, that is a considerable cost to the grower not only because of the lost market, but also because of the

transportation costs, etc., to the plant and back.

So I think it is important for this committee to recognize that in

the marketplace increasingly now the buyers are in there because

they want to maintain their confidence and their relationship with

their customers, are increasingly now testing the product. This is

also true, has been routinely true, of organic products exported to

Europe, where it routinely gets tested. And all of the companies

that we sell our grain to apprise us of the fact that we had better

make sure that there are no contaminants in the product before it

ever leaves our shores.

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Now, all of that, of course, has led us on our farm to simply make

a firm decision, and that is that we will not grow any crops on our

farm now that have a counterpart that has a GMO crop. So for that

reason we had to stop raising canola about 10 years ago, despite

the fact that it was a very good crop in our rotation. And the rotation is important, because something that is not often understood

by nonorganic farmers is that in order to make an organic system

work, you have to have a very complex rotation, which is the way

that you prevent infestation from weeds and diseases and other

contaminants. And so we have found on our farm that we need to

alternate cool-season and warm-season crops, we need to alternate

grassy plants with broadleaf plants, we need to alternate leguminous crops with other cash crops. And there are only so many

alternatives that we have in making those decisions, because we

are limited by climate and other constraints, and also, of course,

most importantly, by the market.

So giving up canola was a big loss to our farm. It was a great

crop. It worked well in the rotation. It is one of the few broadleaf,

cool-season crops that we can grow, and it was a crop that was very

lucrative because we were selling it into a high-end organic oil

market. And we had to give it up.

The thing that concerns us most at this point is that alfalfa and

wheat are now again being threatened to come into the GMO market, and these are two crops which are absolutely essential to our

rotation. A third of our production is in wheat, and if we were to

lose that, it would be a serious economic blow to our farm.

Mr. KUCINICH. I thank the gentleman.

[The prepared statement of Mr. Kirschenmann follows:]

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Mr. KUCINICH. Professor Carter, please.

STATEMENT OF COLIN CARTER

Mr. CARTER. Thank you, Chairman Kucinich.

Despite the successful commercialization of genetically modified

crops in the U.S. agriculture and the successful coexistence of GM

and non-GM, farmers in our Nation have suffered huge financial

losses due to accidental contamination of their crops with unapproved GM material. The most serious accidents were the contamination of the U.S. corn supply in 2000 and the 2006 contamination

of the U.S. long-grained rice supply. In both of these cases, farmers

were innocent victims of lax government regulations and poor stewardship by companies developing, testing and selling GM seeds.

StarLink corn was found in hundreds of food products. The problem spread internationally. StarLink contamination was very disruptive, because a large share of the market had zero tolerance for

its use, and zero tolerance is virtually impossible to obtain. Less

than 1 percent of the U.S. corn acreage was planted to StarLink,

yet 70 percent of the in-bound corn samples tested by Japan, our

most important foreign market, were positive. I have found that

the StarLink contamination resulted in a 6 percent drop in the

price of corn that lasted for at least 6 months, costing corn farmers

$500 million.

In August 2006, U.S. rice farmers were surprised when the

USDA announced that unapproved GM rice had been found in export shipments, and that carrier variety was Cheniere. Apparently,

the U.S. Government knew about this accidental contamination for

some time before farmers were informed in August. Why the delay

in informing farmers?

Just like StarLink, the LibertyLink fiasco has demonstrated that

it takes a very long time to clean up contaminated samples. As

long as a contamination like LibertyLink drags on, farmers are losing money.

The U.S. exports about 50 percent of its long-grain rice, so foreign market tolerance levels for adventitious presence in GM material is very important. The European Union’s imports of U.S. rice

came to a virtual halt following the LibertyLink contamination. In

a matter of a few business days following the contamination announcement, the Chicago rice futures price dropped sharply, by

about 10 percent. Unfortunately for farmers, they were just beginning their harvest, and they suffered a loss to the value of the crop

before they had a chance to market it. LibertyLink found its way

into the rice foundation seed supply. And unfortunately, the USDA

could not explain how this happened.

Then in March 2007, the USDA announced that an additional

popular variety of long-grain rice, CL131, was also contaminated

with Bayer’s LL604 unapproved. The Chicago futures price dropped

sharply again.

Cheniere and CL131 were planted on about 30 percent of the

southern long-grained rice acreage in 2006. These varieties could

not be planted in 2007, causing additional financial losses for rice

farmers.

The economic question boils down to the following: What are the

benefits and costs of deregulation? In my view, the USDA is not

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necessarily taking a hard look at all aspects of this question. Last

year Judge Breyer ruled in a case regarding the USDA’s deregulation of GM alfalfa, highlighting some important gaps in the current

system. The alfalfa case is instructive, but we have to be careful

to distinguish between situations of unapproved GM crops used in

confined field trials from those approved for commercialization.

Both situations can be affected by accidental contamination, but in

the first case all farmers stand to lose, and it is often the legal responsibility of the developing company. In the second case it is a

coexistence issue between GM and non-GM.

One major problem underscored by the alfalfa case is a lack of

Federal rules regarding accidental contamination of organic products. Apparently the USDA does not even know how to handle this

issue, as the Agency argued that producers may not necessarily

lose their organic certification if they unintentionally sell unorganic

crops contaminated with GM. Some organic producers may not

agree. As Judge Breyer implies in the ruling, even if the USDA allowed contamination of organic alfalfa through high tolerance levels for adventitious presence, and sellers could still claim organic

status when contamination occurs accidentally, this would not

guarantee that organic production is sustainable.

The rules should ensure that the production of organic is possible

with a reasonably low contamination level. The USDA should provide better evidence on the benefits and costs of deregulation, especially when exports are an important market for the crop in question and there are barriers in those foreign markets. As we learned

from StarLink and LibertyLink, this technology is not easily reversible. The USDA might find that new GM crops could be grown,

but with certain geographical restrictions, buffer zones, and

traceability and segregation rules.

I am not arguing that the Roundup Ready alfalfa case should be

generalized to all future releases of GM crops and that a full-blown

environmental impact assessment be conducted in all cases. However, in going forward, the USDA should strive to consider which

new crops constitute a significant net economic risk and which do

not. Even in Europe, or in Canada for that matter, approval of a

new GM crop does not entail a formal assessment of commercial

market risks of introducing a new crop, but these other countries

do consider contamination tolerance thresholds and aim to develop

coexistence measures that comply with threshold levels. However,

I do caution that stringent market tests could easily transform into

a precautionary principle approach, which would be a huge mistake.

To summarize, our mistakes over the StarLink and LibertyLink

contamination incidents were major setbacks to the global biotechnology revolution in agriculture. Our trading partners point to

these two incidents as evidence that GM crops are not being properly managed in the United States. They are right. We are not

doing a great job. The stakes are too high to put our heads in the

sand and defend the status quo. Genetically engineered crops hold

tremendous promise for the future of United States and world agriculture, but they must be managed and regulated in a way that

assures the marketplace that any risks are properly managed.

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Mr. KUCINICH. Thank you, Professor Carter.

[The prepared statement of Mr. Carter follows:]

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Mr. KUCINICH. We will now hear from Mr. Clark. I would ask

Mr. Clark if he could keep his testimony to 5 minutes, and then

we will go directly to questions. Thank you.

STATEMENT OF RAY CLARK

Mr. CLARK. Thank you, Mr. Chairman. It is certainly a pleasure

to appear here once again before you, before the Domestic Policy

Subcommittee, on another issue regarding the National Environmental Policy Act. And you have stated my background, that I am

senior partner at The Clark Group after leaving the administration

in 2001. My expertise, therefore, lies in the responsibilities and obligations of the executive branch of government as it relates to decisions affecting the human environment, and I am not an expert

in genetically modified organisms, but have spent my career studying difficult and complex issues and the resolution of those issues,

such as biological defense research and some others that I could

name.

APHIS regulates certain genetically engineered organisms that

may pose a risk to plant or animal health. And I have said—and

I used the word ‘‘may.’’ APHIS Biotechnology Regulatory Services

regulates introduction of genetically engineered organisms that

may pose a risk to plant health. It is a huge responsibility to oversee an industry that is rapidly growing and rapidly becoming more

complex. The decisions that APHIS is making now, however, can

have long-term beneficial or negative effects on the natural environment, the human community, and the economy.

When Congress passed the National Environmental Policy Act in

1969, the country was feeling the effects of a rapidly growing technology in other areas similar to what we are experiencing today.

The rise of the chemical and nuclear industry of the 1950’s and

1960’s and some of the unintended consequences is in part what

led to the passage of the National Environmental Policy Act in

1969.

Congress was prescient enough to know that Federal agencies

will respond to requirements rather than oratory aspirations. The

statute requires agencies to take a hard look at the impacts of

major Federal actions, such as changes to legislation or regulation,

approval of projects, and management of the Nation’s resources.

The Council on Environmental Quality developed the regulations

that require agencies to prepare environmental assessments or environmental impact statements on broad actions so they are relevant to policy and are timed to coincide with meaningful decision

points in agency planning.

And sometimes it seems like agencies are being asked to peer

into a crystal ball, but the courts and the public have understood

that the hard-look doctrine does not require agencies to be perfect

or to understand absolutely the secondary, tertiary or cumulative

effects of programs or policies. But the courts and the public do expect them to at least try. They want to know that the agencies are

not captured by a special interest, but are thinking about the balance that must be struck between economic and environmental

well-being. And these stakeholders want to know that all of us are

being taken into consideration as agencies make decisions.

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After agencies consult with the public, they’re required to make

an informed choice among a reasonable range of alternatives.

Again, the agencies are not being asked to make a perfect decision,

they are asked to follow a logic trail using a defensible methodology

presented in a document that is clear and concise, supported by

evidence and understandable to the public.

For complex decisions like disposing of chemical weapons or permitting genetically modified organisms, NEPA provides a structure

and a discipline to think rationally and to make a decision that

takes multiple objectives into account. NEPA is a tool for agencies

that is so intuitive that even if the law did not exist, they would

have to create a similar decisionmaking process to help them

through these complex decisions.

One of the mistaken practices by the Federal agencies in doing

NEPA analysis allows them to believe that NEPA does not apply

to economic impacts. The purpose of the impact is—and I quote directly from the statute—‘‘to declare a national policy which will encourage productive and enjoyable harmony between man and his

environment; to promote efforts that will prevent or eliminate damage to the environment and the biosphere and stimulate the health

and welfare of man; to enrich the understanding of the ecological

systems and natural sources important to the Nation.’’

The Congress recognized the profound impact of human activity

on the interrelationships of all of the components of the natural environment, including the indirect effects on human dependence—

humans’ dependence economically on the environment. And in particular, Congress acknowledged the profound influences that population growth, high-density urbanization, industrial expansion, resource exploitation and technological advances will have on a natural environment should be considered and given a hard look.

In NEPA, there is clearly an intention to understand the relationship between the environment and our economic welfare. In addition, there is a requirement in the CEQ regulations to balance

the economic and environmental factors in decisionmaking. For genetically modified organisms, the socioeconomic effects are likely to

be interrelated with environmental effects. For example, the genetic drift of genetically engineered traits to nongenetically engineered crops, while an environmental effect, could also have socioeconomic impacts, such as potential effects on the marketability of

products in organic markets or with trade partners.

A recent court case affirmed that the modification of a plant’s genetic makeup through genetic engineering is an effect on the environment.

The linkage between environment, social and economic effects is

precisely the kind of analysis that Congress intended with the statute, and it is precisely the kind of linkage that CEQ saw when the

regulations were drafted in 1979. Whether or not those impacts

were significant remains a question for the analysts, who must

measure significance through an understanding of context and intensity.

Addressing cumulative effects has been a difficult task in the

simplest of projects, but the regulation of genetically modified organisms is not the simplest of actions, but is an issue where understanding the potential of cumulative effects is critically important.

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One way that I’ve always thought that we could do something like

this is a—taking a hard look—is a programmatic approach to environmental impact analysis, and it will help reduce paperwork and

streamline the NEPA process.

Programmatic analyses are appropriate in order to implement

broad decisions for Agency programs, policies or plans. It seems

particularly useful in broad decisions such as genetically modified

organisms. However, I remind you of my earlier statement that significance is measured by both context and intensity. So a programmatic approach would be helpful, but if these decisions are applied in a local environment, an analyst must look at the biological,

physical and socioeconomic context where that decision would be

applied. In a natural ecosystem, a decision may be beneficial to the

environment, but the same decision analyzed in a different socioeconomic context could have a negative effect. That is why programmatic analyses must include tiered analyses to look at the

local environment.

Mr. Chairman, I commend APHIS for renewing and revitalizing

their NEPA regulations. It is needed, and it is past due. I have reviewed the APHIS NEPA matrix for the regulated release of a genetically modified plant, and I must say this continues to be an old

way of looking at NEPA, checking a box to get a document done.

There is not any consideration of context or intensity of the potential impact as related to environmental or socioeconomic factors.

You know, APHIS needs to be—needs to move past these old

ways. They are at a cutting edge of our new world, our new economy, and they need to embrace new ways of making these crucial

decisions that affect all of us.

There has been much work done in this field in the last 5 to 7

years, much of it led by the Council on Environmental Quality and

NEPA practitioners throughout the Federal Government, and there

are three things that I would think that seem directly applicable

to APHIS of which I would recommend a closer look. One is that

APHIS should incorporate an ecosystem approach to the decisionmaking beginning at the policy level. This requires a more holistic

look at what and who are in the ecosystem and how the biota are

responding to natural and man-made changes. Regulations are the

real opportunity for agencies to set policies regarding the NEPA

process, and they need to be expansive in their thinking about

these new regulations.

Two, incorporate a monitoring and adaptive management approach to NEPA. APHIS can therefore spend more time and more

money on monitoring impacts and less on predicting with absolute

certainty.

And finally, incorporate a collaborative way of decisionmaking.

Organic farmers, farmers using genetically modified crops and consumers all have an interest in the ecosystem in which they live and

work. CEQ has issued a handbook on developing collaborative processes, and APHIS should examine how better to engage the public.

In conclusion, Mr. Chairman, thank you for the opportunity to

provide my thoughts on the matter. APHIS, I believe, has an important and unique role to play in the future of our food supply and

the protection of plants. I am sure that their expertise, the willingVerDate 11-MAY-2000 10:29 Jun 05, 2009 Jkt 000000 PO 00000 Frm 00061 Fmt 6633 Sfmt 6633 U:\DOCS\49777.TXT KATIE PsN: KATIE
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ness of the industry and your oversight will produce valuable results for Americans.

Mr. KUCINICH. Thank you very much.

[The prepared statement of Mr. Clark follows:]

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Mr. KUCINICH. We’re going to go to questions. Professor Carter

has asked the indulgence of the committee and the other witnesses

since he has a flight to catch. I’m going to go to you directly with

questions.

Mr. CARTER. Thank you.

Mr. KUCINICH. I take it that you’re not opposed to GE crops in

principle; is that correct?

Mr. CARTER. That’s correct.

Mr. KUCINICH. OK. And nevertheless you believe that field testing and deregulation of GE crops can have a costly impact on farmers when contamination occurs?

Mr. CARTER. Absolutely.

Mr. KUCINICH. You advised USDA to, ‘‘consider which new crops

constitute a significant economic risk.’’ Elsewhere in your testimony you state, ‘‘especially when exports are an important market

outlet,’’ and, ‘‘possible buyer resistance in the foreign market.’’ You

said those things, right?

Mr. CARTER. I did.

Mr. KUCINICH. OK. As you know, APHIS almost never prepares

an environmental impact statement when it permits field testing or

deregulation of genetically engineered plants. In your opinion, have

you ever reviewed any other forum where APHIS might already do

what you advise?

Mr. CARTER. I have not seen any other forum where they’ve done

that, no.

Mr. KUCINICH. That is not the point of the EIS, right? That is

the point, rather, of the EIS?

Mr. CARTER. Correct. But I’ve not seen that elsewhere.

Mr. KUCINICH. As an economist, do you think that preparation

of an EIS poses an economic threat to the commercialization of GE

crops?

Mr. CARTER. Not necessarily. We heard about GM wheat and GM

rice. I mean, the initial release of, for example, GM wheat, in my

opinion, should involve an EIS, and ditto for rice. And it would not

be a threat to the commercial production of that crop.

Mr. KUCINICH. Could it have a favorable effect on commercialization?

Mr. CARTER. It could.

Mr. KUCINICH. How so?

Mr. CARTER. Well, it could—it could change attitudes and views

of firms or individuals that buy the crop. If the EIS is done properly, and it shows that the benefits far exceed the costs, that could

change some attitudes and lead to commercialization and greater

acceptance.

Mr. KUCINICH. What role, Professor Carter—so overall you’re

saying that an environmental impact statement might have a favorable—favorable role in influencing consumer acceptance——

Mr. CARTER. That’s what I’m saying. Thank you.

Mr. KUCINICH. OK. I want to thank the gentleman.

Mr. Clark, you’ve had the chance to review APHIS’ draft programmatic EIS on new regulations pertaining to genetically engineered crops.

Mr. CLARK. Yes, I have.

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Mr. KUCINICH. It was published 5 months after the Roundup

Ready alfalfa and creeping bentgrass Federal court decisions,

which rebuked APHIS for violating NEPA. I wondered if you noticed, as I did, that the entire discussion of socioeconomic impact

is relegated to a 10-page appendix at the end of a 310-page document?

Mr. CLARK. I couldn’t help but notice that, because I was looking

for—looking for some social economic impact analysis within the

body. And I have no objection to putting detail studies in an appendix of an environmental impact statement; however, you’re obligated to at least put the meaning of that and to simplify that and

to make it understandable to the public in the main document

itself.

Mr. KUCINICH. Would you agree that Judge Breyer’s decision in

Geertson ordered APHIS to make consideration of socioeconomic

impact central to determination of whether APHIS’s action is significant under NEPA and requires the preparation of an EIS?

Mr. CLARK. I think Judge Breyer’s decision was uncommonly

clear for a Court decision, and it was absolutely the central point

of the entire opinion.

Mr. KUCINICH. So in your opinion, does APHIS’s draft programmatic EIS incorporate the directive from Judge Breyer’s decision?

Mr. CLARK. If I were the decisionmaker, I wouldn’t put it out the

way it is now because I don’t think it informs the decisionmaker,

nor the public.

Mr. KUCINICH. Now, Mr. Clark, Mr. Leake, the grower who is

here from North Dakota outlined in his testimony a number of

routes of contamination other than pollination. These other routes

would include seed left behind in a harvest; the throw-over from

straw choppers, from trucks transporting the harvested wheat. And

at every link of the chain from field to grain elevator to consumer,

these routes of contamination are more mechanical than the biological routes of contamination such as cross-pollination. In your

opinion, should these mechanical routes of contamination receive

equal consideration as cross-pollination or the biological routes of

contamination for the purposes of determining significance under

the National Environmental Policy Act?

Mr. CLARK. I think clearly the CEQ regulations anticipate that

you’d follow the impacts wherever they came from. But the central

point about NEPA and CEQ regulations, that these are about decisions, and if a decision by APHIS results in cross-contamination,

it doesn’t really matter where it comes from. It is either a direct,

an indirect or cumulative impact. It still must be analyzed in the

EIS so that the decisionmaker and the public can understand the

full import of the decision of APHIS.

Mr. KUCINICH. So you’re saying that—you’re saying it doesn’t

matter where it comes from. Your answer to the question would be,

yes, that the mechanical routes should receive equal

consideration——

Mr. CLARK. It must receive it. It must receive it.

Mr. KUCINICH. So in your testimony you identify a possible shortcoming of the decision matrix APHIS developed in response to two

Federal court decisions last year which rebuked APHIS for having

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no record of consideration of potential environmental impact from

decisions to permit field testing and deregulation of genetically engineered plants. You’ve said, ‘‘there is not any consideration of context or intensity of potential impact as related to environmental

and social factors.’’ And you’ve asked, ‘‘how is the timing of the proposed GMO release considered in the matrix; how does the matrix

account for any synergistic or indirect impacts.’’

Do you believe, Mr. Clark, that the decision matrix now used by

APHIS ensures that its reviewers will fully comply with the National Environmental Policy Act?

Mr. CLARK. I don’t see for the life of me how that matrix will do

anything for the decisionmaking because it looks at the action. It

is looking at the plant itself down to the ground and not looking

at the environment—not looking at either context or intensity.

Mr. KUCINICH. So is that decision matrix sufficient to ensure that

APHIS complies with the National Environmental——

Mr. CLARK. No, no.

Mr. KUCINICH. And in your testimony you advise APHIS to incorporate a collaborative way of decisionmaking and refer APHIS to

a new handbook on developing collaborative processes issued recently by CEQ. Your testimony to farmers, some of whom met with

and petitioned APHIS to prepare environmental impact statements

in the past, while APHIS refused their request for petitions, at

least APHIS met with the farmers. Is that sufficient?

Mr. CLARK. That is not collaborative decisionmaking, not on

anybody’s——

Mr. KUCINICH. So describe again a collaborative decision.

Mr. CLARK. Well, collaborative decisionmaking—and let me give

you some amount of context here—is that there has been a very

strong push by the Council on Environmental Quality to develop

collaborative decisionmaking, including cooperating agencies, so

that counties—counties in which farmers reside could easily ask to

be a cooperating agency of APHIS so that they can use their special

expertise with regard to economic impacts on the county, on the

farming, on the farming community there. So being a cooperating

agency would be a much more collaborative way of doing that.

There would be—there is a lot more sophisticated collaborative

processes that are described very well in the CEQ handbook.

Mr. KUCINICH. Thank you, Professor Carter. I appreciate you

being here. Thank you.

Mr. CLARK. And is available to all of the Federal agencies. I

won’t take the time here to describe them, but I will say that the

Administrative Procedures Act passed in 1947. Even that—even

the way that APHIS handled that particular issue wouldn’t even

comply with the Administrative Decisions Act of 1947.

Mr. KUCINICH. I thank the gentleman.

I want to go to questions now to Mr. Leake. You said that the

crop options available to you are limited due to where you are. Climate and latitude are factors in your planning options. Now, if you

couldn’t grow hard spring wheat profitably, as you fear would occur

if a genetically engineered wheat variety is approved by APHIS,

what could you and others grow profitably in its place given your

climate and latitude?

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Mr. LEAKE. I don’t think we could continue, because about twothirds of the acreage of North Dakota has planted a wheat annually, and the rest of North Dakota, at least northern North Dakota,

north of Interstate 94, is not suited to corn and soybeans. 1994—

or 2004, 2005 or 2006 we had failures or disappointing yields for

corn in the northern two-thirds of North Dakota because it requires

a lot of moisture and a lot of heat to grow corn and soybeans to

get the yields necessary to be profitable.

So we are, as has been mentioned before, very dependent on coolweather crops, small grains being one of those. However, we do

have some other options, which are specialty crops, such as navy

beans, pinto beans, black beans, edible bean crops and sunflower.

However, there is limited demand for those particular commodities,

so we wouldn’t be able to substitute those crops into the acreage

that wheat now is grown on and still have a price because the supply would exceed the demand.

Mr. KUCINICH. Now, you’ve written in your testimony that if a

contamination event like the StarLink case would happen to wheat

crops, the effects would be much worse on farmers. You note that

a greater share of the wheat crop is sold on the export market, and

the animal feed market isn’t a viable backstop for wheat that can’t

be—that wheat can’t be sold for human consumption. Did you

make those arguments to APHIS when you were seeking an EIS

for Roundup Ready wheat?

Mr. LEAKE. Yes, we did.

Mr. KUCINICH. What did APHIS say?

Mr. LEAKE. Basically when we met with—in March 2004 with

Undersecretary Hawkes and the Acting Director of APHIS, we put

that argument forth to them. Their final decision on that was not

to grant an environmental impact statement. I guess that says it.

Mr. KUCINICH. What did they say to you, though? Was there anything else said?

Mr. LEAKE. Basically the Under Secretary said it was—that they

didn’t have the authority to pursue an EIS to give us the input into

the decision on the petition for deregulation.

Mr. KUCINICH. Did APHIS show you any evidence that they had

seriously considered the concerns you were raising?

Mr. LEAKE. No. No, they did not.

Mr. KUCINICH. How did that make you feel? What did you think

about that?

Mr. LEAKE. I felt very shut out of the process. I felt like it wasn’t

a democratic process, that I was a stakeholder—it was my livelihood at stake, and that I wasn’t given any consideration, and that

the company that was pursuing the deregulation of the Roundup

Ready wheat was given consideration, but I as a grower was not.

Mr. KUCINICH. And when that happened—because growers by

nature have to look forward—what was going on in your mind

when you looked forward from that moment based on the way it

was being handled where they didn’t really show any real, you

know, connection to your concerns?

Mr. LEAKE. Well, in the past, the other Roundup Ready crops,

such as soybeans and corn, had been deregulated and introduced

into the marketplace. Using that as an example, I fully expected

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duced within a year or two. We had been warned directly by our

customers in numerous formats, numerous times and places, that

they would not access our wheat supplies for importation if we

were to be—have GE—or GE crops growing commercially in the

United States. And that actually started to happen. So I felt——

Mr. KUCINICH. Would you say—what? Would you repeat that?

Mr. LEAKE. Prior—prior to the introduction of any GE wheat,

some of the milling companies in Europe, Ranco was one of them,

I believe, was starting to develop commercial ties with wheat suppliers in Kazakhstan and the Ukraine in anticipation of a GE

wheat supply from the United States and Canada. This is just business. They anticipated that it would be commercialized; therefore,

they could not utilize U.S. wheat supplies. They sought them elsewhere, as they said they would.

Mr. KUCINICH. Now, how—has this affected you financially?

Mr. LEAKE. The—of course, the Roundup Ready wheat deregulation never occurred. So we are still GE-free, and GIPSA, the Grain

Inspection, Packers and Stockyards Administration, still issues its

letterhead statement that U.S. wheat supplies are GE-free. And

that is required by most of the customers that we export our harvest spring wheat to. That has become the—a pivotal document for

them to keep accepting U.S. wheat exports.

Mr. KUCINICH. Your testimony states that the EIS, ‘‘provided the

best opportunity to present,’’ the case of concerned wheat growers

about the risk of Roundup Ready wheat. Why, in your opinion, is

the public comment period for an environmental assessment or

meetings that you have had with APHIS officials not an adequate

forum for presenting your case?

Mr. LEAKE. Well, a comment period doesn’t have the same ability

to garner comments as would be the scoping process of an EIS.

During a—scoping meetings, they are held in the areas where people would be affected. They’re invited to come and voice their concerns. That is incorporated into the EIS draft. And we also have

an opportunity to comment on the draft EIS. This isn’t necessarily

available in the EA. So I felt that, you know—as a person of North

Dakota, I’ve seen a lot of EIS scoping notices go out on a lot of

projects, etc. People have the opportunity to come en masse to voice

their concerns. The administrative process of an EA basically shuts

out most of the concerned people.

Mr. KUCINICH. Do you think that APHIS based their rejection of

your petition on—to prepare an EIS to, you know, hard look at the

risk, they base that on science and economics, in your opinion?

Mr. LEAKE. I don’t think so, because it is quite apparent to everyone, especially anyone who is involved in farming—Under Secretary Hawkes, when we talked to him, he told me that he was a

wheat farmer. I’m quite sure that he was cognizant of the simple

process of the economic implications of not being able to export

wheat when wheat is—when half the wheat crop in this country is

exported. We would find a drop in price.

Mr. KUCINICH. Thank you, Mr. Leake.

Mr. Howington, you raise GE soybeans, but you’re here testifying

on the effects of unauthorized GE rice release.

Mr. HOWINGTON. Yes, sir.

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Mr. KUCINICH. I take it you’re not opposed to GE crops in principle?

Mr. HOWINGTON. In principle, no, sir.

Mr. KUCINICH. OK. Do you think your advocacy with APHIS for

an environmental impact study that analyzed the effects of contamination is anti-GE crop in principle?

Mr. HOWINGTON. No, sir, not at all.

Mr. KUCINICH. Why would a grower of GE crops have a concern

about the development of new GE crops?

Mr. HOWINGTON. My concern is not with—my concern is with

contamination. When they call it contamination, and it comes out

of my pocketbook, that is my concern.

Mr. KUCINICH. You state that many rice farmers—I think you

said about 600 in your testimony—went out of business after the

LibertyLink rice contamination event. You yourself now lease out

your own land to neighboring farmers, and you don’t farm rice anymore.

Mr. HOWINGTON. That’s correct.

Mr. KUCINICH. When one farmer quits and another gets bigger,

the total number of farmers decreases, and concentration in the industry increases. This has historically been a great deal of—there

has historically been a great deal of concentration in the farming

business. Is additional concentration in farming attributable to the

economic effects of contamination by GE crops as an impact people

should be concerned about?

Mr. HOWINGTON. Yes, sir. There are a number of things that contribute to that, but certainly the genetic event we had in 2006,

farmers quit simply because of the economic effects of that event.

Mr. KUCINICH. I want to go into this just a little bit. You had

the Liberty rice—LibertyLink rice contamination event.

Mr. HOWINGTON. Yes, sir.

Mr. KUCINICH. Once you learned of that, walk me through what

happened. You know, how did you find out about it?

Mr. HOWINGTON. We found out about it, and it was—in our part

of the world, agriculture is—it is like politics in Washington. It’s

what goes on. It was on in every paper, it was on every news, it

was on all of the reports. It was everywhere.

Mr. KUCINICH. As soon as that happened, what did you do?

Mr. HOWINGTON. I tried to find out what the consequences were

going to be for me; wondered what my crop was going to—what

was going to happen to my crop, my price, my market.

Mr. KUCINICH. Would you tell this committee for the record what

did happen?

Mr. HOWINGTON. The price dropped. It dropped precipitously and

very quickly. Unfortunately, I didn’t have a lot of my crop priced,

which was very common at that time. Rice prices were headed up.

We were hoping for a rise in prices. It went the other way.

Mr. KUCINICH. What happened to you?

Mr. HOWINGTON. They went the other way.

Mr. KUCINICH. What happened to you?

Mr. HOWINGTON. That year I didn’t get as much for my rice as

I was hoping I would.

Mr. KUCINICH. How much of a loss did you take?

Mr. HOWINGTON. I would say in the $50,000, $60,000 range.

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Mr. KUCINICH. What does that mean for a small farmer?

Mr. HOWINGTON. A fellow like me whose disposable income is

less than that, meant a lot.

Mr. KUCINICH. Did it wipe you out?

Mr. HOWINGTON. I don’t want to use the term ‘‘wiped me out.’’

I’d say it——

Mr. KUCINICH. Damaged you severely?

Mr. HOWINGTON. It damaged me severely. Farming is a huge

risk.

Mr. KUCINICH. It is a family thing, too. What can you tell us

about—what kind of effect did this have on your family?

Mr. HOWINGTON. Well, I mean, this is a farm that has been—my

grandfather literally cleared this land. My father developed it and

leveled it, put wells on it. I came along and farmed it. And I

farmed it, started full time in 1980, and it just—the economics of

the situation just—and the risk. That is the big thing about farming, it is a huge risk. As I say, my disposable income was less than

the $50,000, $60,000 I lost in that event.

Mr. KUCINICH. So tell us about how you felt, though, because,

you know, a lot of times this stuff gets academic until it comes

down to a personal level. How did it feel?

Mr. HOWINGTON. It was a horrible feeling. It is a—when you realize that where you stand on the totem pole in this deal—obviously throughout this deal, what was going to happen to the farmer

was the last consideration. And when you realize where you stand

on the totem pole, it is devastating to you. As farmers, we go out

every day and we work hard. We work very hard. We risk a lot,

you know. And when something like this happens, it is very depressing, very demoralizing.

Mr. KUCINICH. You know, I appreciate you and the witnesses

here telling their personal stories because it helps people connect

with it. They’ve got to be in your place. This is your grandfather’s

farm.

Mr. HOWINGTON. Yes.

Mr. KUCINICH. I mean, this is why I’ve gone into questioning you

in a little bit different way here because I think we need to really

understand the impact this had on you. This is—again, there is a

lot about this debate that cannot be academic. This affects people’s

lives in huge ways.

Mr. HOWINGTON. Well, this is a family farm that went by the

wayside. It was not the only one by any means that was—that this

event contributed to.

Mr. KUCINICH. I want to thank you for your testimony, Mr.

Howington, as well as all the other witnesses.

I have some questions for Mr. Kirschenmann. In their EA for

Roundup Ready alfalfa, APHIS made the following statements with

regard to RR alfalfa’s negligible impact on organic alfalfa. They

said, ‘‘fields’’—talking about alfalfa—‘‘are typically harvested before

the seed is set and allowed to mature because high-quality forage

is the desired product.’’ That is page 14. And they also said, ‘‘organic production operations require to have distinct, defined boundaries and buffer zones to prevent unintended contact with prohibited substances from enjoining land that is not under organic management.’’ That is on page 13.

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Now, do these statements from USDA persuade you that USDA

gave serious consideration to the question of impact on organic

farming?

Mr. KIRSCHENMANN. I think they gave serious consideration to

an abstract farm. They didn’t give serious consideration to a real

farm because—the reason I say that is——

Mr. KUCINICH. What do you mean by that?

Mr. KIRSCHENMANN. What I mean by that is what they describe

is true in theory, but on a real farm you have events like unusual

rainfalls, when you can’t get in to harvest your alfalfa crop in time

before it goes to bloom; or you may have a low area in a corner of

a field that you can’t get into for several weeks if you have had a

lot of rain. Or you may have a drought situation where your alfalfa

never gets to a point where it is worth cutting. And so, then, you

know, are we really going to expect farmers to cut all that alfalfa

just so it doesn’t go to bloom? I mean, I think that is pretty unrealistic. So in a real farm, you have those kinds of real situations that

don’t always work as they seem they should work in theory.

Mr. KUCINICH. So is it possible that they developed this approach

with the advice of farmers?

Mr. KIRSCHENMANN. A little doubtful.

Mr. KUCINICH. I’d like to add to the record——

Mr. CAMERON. Mr. Chairman, could I add something to that?

Mr. KUCINICH. Yes. I mean, I’d be happy to have you join into

this. Please do.

Mr. CAMERON. I am a real farmer. I grow Roundup Ready alfalfa

200 yards away from my organic alfalfa. I’m not saying that you

couldn’t come up with a situation to where you could have a problem, but I think good stewards of the land, good farmers, we cut

our hay actually prior to bloom.

I agree. We live in California. It doesn’t rain much. When it does,

it rains in the winter. But I feel confident I could grow Roundup

Ready alfalfa side by side to organic alfalfa and not have an issue

with contamination or adventitious presence. So what I do understand—there are other situations in the United States, but——

Mr. KUCINICH. Well, I think he has kind of implied that your

conclusions would be defined by the climate and latitude a little

bit. I mean, they have to have some impact on it, right?

Mr. CAMERON. True. But I agree. If you’re going to be an economic farmer, you not going to—you don’t want your alfalfa to

bloom in the first place. If it does bloom, the time between there

and the time that you set the seed is quite some time.

Mr. KUCINICH. I’m not a farmer, but here is the thing I want to

ask you, if I may, Mr. Cameron. This same question that we’re

talking about, the Federal judge, here is what this Federal judge

concluded. I want to quote this to see what you think, and then I’d

like Mr. Kirschenmann to comment on it, too. Talking about

APHIS: ‘‘APHIS made no inquiry into whether those farmers who

do not want to grow genetically engineered alfalfa can, in fact, protect their crops from contamination, especially given the high geographic concentration of seed farms and the fact that alfalfa is pollinated by bees that can travel more than 2 miles. Neither the EA

nor the FONSI identify—FONSI, it is called—identify a simple

method that an organic farmer can employ to protect his crop from

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being pollinated by a bee that travels from a genetically engineered

seed farm, even assuming the farmer maintains a buffer zone.’’

Now, that is what the Federal judge said in this case. What do

you think about that?

Mr. CAMERON. I think your seed requirements are much different

than your typical growing of the forage requirements should be. I

think separation of a seed grower should be much different than

a traditional forage grower.

Mr. KUCINICH. Well, Mr. Kirschenmann, what do you think

about that in terms of the impact on organic farming?

Mr. KIRSCHENMANN. Well, the thing that—I mean, I want to

commend Mr. Cameron, because he is apparently managing his

system very well, but, again, when you look at the situation in

terms of rank-and-file farmers, not every farmer, as in any other

field, is equally competent, is equally capable of controlling systems.

The thing that is disturbing to me is that we keep having these

claims that we have this under control, that there is no problem

and no danger of contamination, and yet just here 2 weeks again

we had, you know—so, you know, it is—the fact that—Charles

Perot at Yale University published a book back in the late 1980’s

called Normal Accidents, and the case that he made in that was—

the reason he called them normal accidents is because they happen. You can’t manage any system constantly perfectly. There are

going to be mistakes that are going to be made. And the problem

in this system, you know, for me and my farm, if somebody makes

a mistake, I can’t—I can’t undo that mistake. It harms me economically. And this is why we made the decision on our farm not

to grow any crops that have a GMO counterpart. Now, that works

for us now as long as we continue to have a range of crops that

we can grow effectively in our rotation and have markets for them.

That probably is not going to be the case very far into the future

if we continue, you know, bringing new crops into the situation.

And so, you know, I agree that there may be an individual case

here and there where you can demonstrate that you can manage

it, there isn’t a problem. But if you look at the situation and the

market as a whole, you can’t make that case. The evidence is too

clear.

Mr. KUCINICH. Well, I want to thank all of the witnesses for their

participation. Each of you came here to communicate experience,

which is going to be valuable in the committee being able to make

some determination as to where we go. And we have a variety of

experience here, and I think that it is very helpful.

Again, this is not the hearing to determine whether the GE technology is good or bad. We’re looking at what is APHIS doing or

what is USDA doing. That is the committee’s charge here. So I

want to thank you for shedding some light on this.

I’m going to dismiss the first panel with the gratitude of the committee. Thank you. And we’re going to—as they’re leaving, we’re

going to get ready for the presentation from the next panel, which

will consist of the Administrator of the Animal and Plant Inspection Service [APHIS], U.S. Department of Agriculture, Cindy

Smith.

[Recess.]

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Mr. KUCINICH. Before we begin, The administrator has informed

the committee that one of her assistants is going to be present. You

know, I want to acknowledge that there are areas here that can become very complex, and if I was in the shoes of the Administrator,

I would certainly want to have someone nearby who could assist

in making sure that the committee gets the, you know, best information that we can. So I want to acknowledge the gentleman. And

since you’ll be assisting in this, I would ask you to also be sworn

so that we can have concurrence in our testimony here. Would both

of you please stand and raise your right hands?

[Witnesses sworn.]

Mr. KUCINICH. Thank you. Let the record show that the witnesses answered in the affirmative.

I’d like the gentleman to give his name and his position and his

function in the office of the Animal and Plant Inspection Service.

Mr. GREGOIRE. Mr. Chairman, I’m Michael Gregoire.

Mr. KUCINICH. And would you bring your microphone closer?

Would you spell Gregoire for the staff here?

Mr. GREGOIRE. Yes. It is spelled G-R-E-G-O-I-R-E. Michael

Gregoire. I’m the Deputy Administrator for Biotechnology Regulatory Services in the Animal and Plant Health Inspection Service.

Mr. KUCINICH. OK. OK. And with us is Cindy Smith, who is the

Administrator of the Animal and Plant Inspection Service of the

U.S. Department of Agriculture. I want to thank both of you for

being here, and I would like Ms. Smith to commence with her testimony.

STATEMENT OF CINDY SMITH, ADMINISTRATOR, ANIMAL AND

PLANT HEALTH INSPECTION SERVICE, U.S. DEPARTMENT

OF AGRICULTURE, ACCOMPANIED BY MICHAEL GREGOIRE,

DEPUTY ADMINISTRATOR FOR BIOTECHNOLOGY REGULATORY SERVICES, ANIMAL AND PLANT HEALTH INSPECTION SERVICE, U.S. DEPARTMENT OF AGRICULTURE

Ms. SMITH. Mr. Chairman, thank you for the opportunity be here

today.

APHIS is responsible for ensuring that biotechnology-derived

crops are as safe for agriculture and the environment as their traditionally bred counterparts. Over the last 20 years, APHIS has effectively overseen the safe adoption of products of biotechnology,

with 12,000 field trials grown under our notification procedures

and 1,500 field tests grown under the permitting process, encompassing field trials at 79,000 different locations. In addition, we

have deregulated more than 70 products in that time.

APHIS is a leader globally in biotechnology regulatory experience. In 2002, we recognized, though, that there were still more—

that there was still more that we could do to better position the

Agency to respond to the evolving science and growth of biotechnology. That was when BRS was created, and I became the

Deputy Administrator of the program.

Since then, we’ve made a number of significant improvements to

APHIS’s biotechnology regulation. APHIS has committed increased

resources to our regulatory activities. BRS’s budget has grown by

more than 200 percent in the past 6 years. Staff levels have increased from 25 to 60 employees. We have placed more focus on

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key regulatory areas and created dedicated staff for these functions. For example, we established a dedicated compliance and enforcement unit in BRS in 2003. We’ve automated the regulatory

and compliance processes and made a number of significant regulatory changes, as well as numerous revisions, to permit requirements. We now have in place stricter measures for crops producing

pharmaceutical and industrial compounds, not only increasing requirements for the regulated community, but also APHIS’s role in

the oversight of these products. Additionally, we recently launched

a new voluntary quality management system for biotechnology developers to foster—to help foster industry commitment to quality

controls, quality management and quality compliance.

I share this committee’s respect for the National Environmental

Policy Act [NEPA]. We have made a number of changes to ensure

environmental impacts of our proposed actions are fully considered.

We are undertaking comprehensive programmatic as well as product-specific EISs. Our first programmatic draft EIS, which was

published in July 2007, will lay the groundwork for a comprehensive updating of our Federal framework.

Our environmental assessments now contain much more detailed

scientific analysis and include more scientific references, analysis

of effects on organic protection, and a toxicity table for effects of

biotechnology-derived crops on nontarget insects. We have also enhanced our documentation for categorical exclusions from NEPA,

more closely analyze cumulative impacts, and put in place a formalized process with the U.S. Fish and Wildlife Service to ensure

compliance with the Endangered Species Act. We made a number

of these changes even before the court rulings directing us to better

document our environmental analysis, and other changes came

after as our understanding of what the courts expected of our

NEPA documentation evolved and we continued our commitment to

meeting our environmental obligations.

Mr. Chairman, let me focus the remainder of my remarks on last

year’s situation regarding Roundup Ready alfalfa, as well at NEPA

regulatory changes we’re considering, as those were areas you were

interested in.

APHIS had prepared an environmental assessment [EA], to determine whether deregulating the alfalfa could have a significant

impact on the environment, and issued a finding of no significant

impact [FONSI]. In order to comply with the preliminary injunction, APHIS brought Roundup Ready alfalfa back under regulation

until the Agency issues a new determination consistent with the

court’s requirements. The court did not overturn Federal conclusions regarding the safety of the crop for food or feed purposes, but

rather concluded that APHIS had not adequately documented potential environmental effects.

Again, we are taking this opportunity to examine and strengthen

our NEPA processes. APHIS already considers the social and economic impacts of a proposed action in those cases where there is

a clear relationship with environmental impacts. We are strengthening our documentation in this area, both in our recent regulatory

decisions and in the alfalfa EIS being drafted. And I look forward

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standing of how to apply the NEPA process to inform our decisionmaking.

APHIS is also in the process of promulgating a proposed rule

that will make changes to how we implement procedures under

NEPA aimed at providing further clarity to this process. These potential changes would more closely tie our decision to prepare an

EIS to the language in NEPA. These and other changes we are considering would also clarify that we base our decisions to prepare an

EIS or EA on an action’s potential effect on the environment.

Mr. Chairman, my statement for the record includes much more

detailed information regarding our regulatory system for biotechnology crops, as well as steps we are taking now to enable us

to continue regulating the next generation of products. Let me conclude by saying that our actions today to revise and strengthen our

regulations, as well as learn from our previous experiences, will

hold us in good stead for the future.

I look forward to answering your questions. Thank you again for

the opportunity to testify before the subcommittee.

[The prepared statement of Ms. Smith follows:]

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Mr. KUCINICH. Thank you very much.

I have some prepared questions. But before I get to them, you

sat back there and you heard the testimony of the farmers. And

you know, you heard Mr. Howington talk about how his grandfather had that farm and then what happened with the

LibertyLink rice. What about that? When you hear that from a

farmer, do you think that maybe somebody failed somewhere?

Ms. SMITH. Well, I guess I have a number of reactions. It certainly emphasizes how seriously we took this situation when it occurred. It emphasized the decisions we made at the time to go contrary to some of our historical procedures in terms of, we historically complete an investigation in terms of a situation such as this

before we start talking publicly about it so we don’t compromise

the nature of the investigation. But what became very clear to us

was that we wanted to make sure the farmers knew everything

they could to help them prepare for the planting season. And so we

made two separate announcements, kind of contrary to what our

historic policy had been, letting farmers know about what we had

learned. And in addition, another thing that we did was when we

learned about the second rice-related event, we took immediate

measures, within hours, and we stopped—I may not have the number exactly right—but I think it was in the neighborhood of 98 percent of all the Clearfield rice that was moving to farmers to plant,

so that what happened was very—I think there may have been potentially one farmer that planted a very small spot of Clearfield.

So we are very empathetic absolutely, and that is partly what

drove a lot of the actions that we took during the situation.

Mr. KUCINICH. Well, I mean, after all, two Federal judges concluded that APHIS was in violation of NEPA in two separate genetically engineered plant cases. And in these cases, APHIS review

of the deregulation application for Roundup Ready alfalfa and the

field testing of Roundup Ready creeping bentgrass were deemed by

the courts to be inadequate, ‘‘arbitrary and capricious,’’ and in violation of NEPA. Now, you have not appealed these judges’ decisions

as relate to violations of NEPA; have you?

Ms. SMITH. Actually, we are not. We have an appeal on one of

the cases, but we are not disagreeing with the judges’ determination that we were in violation of NEPA.

Mr. KUCINICH. Well, APHIS is now preparing an EIS in both

cases, though, is that right?

Ms. SMITH. That is correct.

Mr. KUCINICH. And I wanted to ask you a question about

APHIS’s reaction to those judges’ decisions. As you are aware, in

the alfalfa case, Judge Breyer concluded, ‘‘APHIS made no inquiry

into whether those farmers who do not want to grow genetically engineered alfalfa can in fact protect their crops from contamination.’’

He went on to say neither the EA nor the FONSI identify a single

method that an organic farmer can employ to protect his crop from

being pollinated by a bee that travels from a nearby genetically engineered seed farm even assuming the farmer maintains a buffer

zone. And Judge Breyer said, ‘‘Neither the EA nor the FONSI contain any reference to any material in support of APHIS’s conclusion

that gene transmission is highly unlikely to occur with reasonable

quality control.’’

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Ms. Smith, do you now feel that APHIS had to make such an inquiry to comply with the National Environmental Policy Act.

Ms. SMITH. The Court directed us to do so, so that’s exactly what

we are doing, and that’s what we have been doing in all of our regulatory decisions since that time.

Mr. KUCINICH. And do you now feel that APHIS has to show the

analysis involved in making the inquiry to comply with NEPA?

Ms. SMITH. Absolutely. One of the realities that we faced is that

we have a staff of scientists that are top notch experts in terms of

science. What we have not historically done as good a job with is

to help them understand how to document our requirements under

NEPA. And so while our scientists have looked at these issues,

have discussed them, we have had much conversation and dialog

and research happen, we have not adequately documented in this

case what we needed to.

Mr. KUCINICH. Well, let’s go back to Judge Breyer for a second.

I am going to read some more things, see if we can come to agreement here. Judge Breyer, ‘‘an action which potentially eliminates

or at least greatly reduces the availability of a particular plant,

here nonengineered alfalfa, had a significant effect on the human

environment.’’ And he said, ‘‘the significant impact that requires

the preparation of an EIS is the possibility that the deregulation

of Roundup Ready alfalfa will degrade the human environment by

eliminating a farmer’s choice to grow nongenetically engineered alfalfa.’’ Does APHIS now agree that the possibility of genetic contamination causing a narrowing of farmer choice is a significant

impact under the National Environmental Policy Act?

Ms. SMITH. What we are doing is looking at any situation in

which an environmental decision will have a significant environmental impact and that will also have a related economic impact,

which is what the judge directed us to do.

Mr. KUCINICH. So you are saying you basically agree then? You

agree?

Ms. SMITH. You are asking, do we agree that there could be a

significant impact of a contamination situation? Is that what you

are asking?

Mr. KUCINICH. I will ask it again. I just want to make sure that

we have precision here. Does APHIS agree now that the possibility

of genetic contamination causing a narrowing of farmer choice is a

significant impact under NEPA?

Ms. SMITH. What we have to do is look at the environmental decision, environmental impact, and then look at the economic impacts associated with that. And so that’s what we are doing. And

so you could envision a situation in which that could be the case.

Mr. KUCINICH. But do you agree with that? Do you agree with

Judge Breyer’s assessment?

Ms. SMITH. You know, since the judge gave us the order, we are

going to do exactly what the judge has told us to do. So we are

looking in that avenue, and we are putting the resources into making sure that we have done a very thorough environmental analysis

as well as economic analysis for all aspects of that.

Mr. KUCINICH. You haven’t appealed that aspect of the judge’s

decision.

Ms. SMITH. No, we have not.

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Mr. KUCINICH. OK. Just again, using Breyer’s decision to look at

the way you look at these things, he said, ‘‘APHIS argues in its

brief that the extent of any gene transmission is in any event irrelevant because NEPA requires an agency to consider physical environmental impacts, not economic or financial impacts. APHIS overstates the law.’’ He goes on to say the economic effects on the organic and conventional farmers of the government’s deregulation

decision are interrelated with, and indeed a direct result of, the effect of the physical environment, namely the alteration of a plant

species’ DNA through the transmission of a genetically engineered

gene to organic and conventional alfalfa. APHIS was required to

consider those effects in assessing whether the impact of its proposed action is significant. But its reasons for concluding that the

effect on organic and conventional farmers is not significant are not

convincing. Now, when Judge Breyer refers to economic effects

being interrelated with environmental impacts and significant, he

is quoting from the National Environmental Policy Act’s implementing regulations. Does APHIS now agree with Judge Breyer

that determining the significance of a proposed action under NEPA

requires considering economic impacts interrelated with environmental impacts?

Ms. SMITH. We do agree that if there are environmental impacts

and economic impacts associated with those, that they need our full

analysis, and we will do so in our NEPA analysis, whether it is in

an environmental assessment or an environmental impact statement.

Mr. KUCINICH. We have just reviewed a number of areas of

Judge Breyer’s decision. And it appears that APHIS is ready to incorporate those judicial rulings into your interpretation of your

NEPA obligations. Is that correct?

Ms. SMITH. It is correct that we recognize that where there is an

environmental impact, a significant environmental impact, that we

have to consider the economic impacts related to that, yes, sir.

Mr. KUCINICH. So what are the lessons that you have learned

about NEPA obligations from Judges Breyer and Kennedy?

Ms. SMITH. The fundamental thing that we have learned is that

we have to do a better job of documenting the work that we are

doing. In the previous case, it led us to develop a number of documents to document more precisely whether we need to do a categorical exclusion or an environmental assessment. And just in

terms of a point of clarification regarding the previous testimony

you heard regarding our documentation we provided you, the documentation we provided you is not intended in any way to be our

environmental analysis that we conduct, an environmental assessment or an EIS. That documentation is to very clearly——

Mr. KUCINICH. I am glad you pointed that out.

Ms. SMITH [continuing]. Very clearly to help us determine if that

regulatory decision is something that can be categorically excluded

from NEPA, from a full NEPA analysis, or if it needs an environmental assessment. And so it is just a start in terms of our just

looking at just the categorical exclusion decision.

Mr. KUCINICH. You have a new decision matrix?

Ms. SMITH. We have the matrix we gave you, but that is only in

terms of only determining whether a categorical exclusion applies

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or if we need to do an environmental assessment, which would be

an alternative to that.

Mr. KUCINICH. Since the Breyer and Kennedy decisions, is it fair

to say you have a new decisionmaking matrix?

Ms. SMITH. We have strengthened our documentation, that’s correct.

Mr. KUCINICH. But it is also—I just, you know, just to make sure

we are going in the right direction here, the decision—any decision

matrix could be calling for minimal compliance. Are you, in terms

of the compliance meter, are you looking for minimal compliance or

are you looking to really comply fully?

Ms. SMITH. Right. I don’t want to confuse issues here. The purpose of these matrices that we have developed, and I think one has

30-some specific aspects that we are looking at, we have questions

in that matrix to help us make sure that we consider every aspect

that is relevant in terms of a decision on a categorical exclusion.

And in one case, we learned—our lesson learned from one case is

that we had to do a better job of documenting that something

qualifies for a categorical exclusion. We made changes. We did a

good job of that. In the next case, the judge ruled we did document

the categorical exclusion appropriately, but we failed to document

the exceptions to that categorical exclusion. And so that is the new

matrix that you see that we developed as a result of the second

case.

Mr. KUCINICH. Will APHIS broaden its interpretation of significant impact so it comes into line with the court’s interpretation in

Geertson——

Ms. SMITH. I think historically we have, and in the EA that you

saw, we took a more closely related to plant pest authority evaluation of the situation, which is what our regulatory authority is.

What we heard clearly from the judge is that for any situation in

which there is a significant environmental impact, we have to consider the economic impacts. And so we are doing that.

Mr. KUCINICH. So let’s talk about Geertson again. Are you looking at the economic impact on farmers resulting from potential contamination?

Ms. SMITH. Yes, we are.

Mr. KUCINICH. OK.

Ms. SMITH. Specifically, I could add, if you are interested, when

we announced the EIS, one of the specific areas that we announced

that we are scoping for is the economic impacts of Roundup Ready

on nonbiotech adopters.

Mr. KUCINICH. A nonbiotech——

Ms. SMITH. Adopters. So in other words, your organic farmer,

your traditional farmer that is not growing any biotech.

Mr. KUCINICH. Are deregulation decisions of GE plants inherently likely to have significant environmental impact?

Ms. SMITH. That would be based entirely on the nature of the

crop and the trait that has been incorporated into the crop. And

that is why we do a very specific deregulation decision for each one

of those applications.

Mr. KUCINICH. I mean, you look at the International Center case

and what Judge Kennedy said, he said he considers the significance that the size of test plots, the number of test plots with field

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tests have in determining environmental impacts. Logically,

wouldn’t deregulation decisions which allow the unrestricted commercial transport of GE crops, thereby enabling the unlimited

planting of GE crops, pose an even greater environmental impact?

Ms. SMITH. That is possible. And we would not make a deregulation decision unless we determine that crop that is being proposed

was entirely safe for the environment and agriculture.

Mr. KUCINICH. So should proposed deregulations in this—you

know, in these areas require an environmental impact?

Ms. SMITH. In September 2004, as the deputy of BRS, I made a

decision that the creeping bentgrass petition application was such

that, due to the nature of the crop, it was necessary for us to conduct an environmental impact statement.

Mr. KUCINICH. As you know, APHIS has prepared a draft programmatic EIS in connection with its intention to promulgate new

biotech crop regulations. Now, my staff has reviewed the draft EIS

carefully, and we are left wondering if it reflects any lessons

learned from the rebuke that APHIS received from two Federal

courts last year. For instance, take its discussion of socioeconomic

impacts. Discussion of those impacts again goes to that 10-page appendix at the end of the 310-page document. And you have already

responded to that. Is that——

Ms. SMITH. No, you are asking now, why is that information in

an appendix in that document? And I give you two answers for

that. First, you referenced the size of that document. And so that

should give you a sense of the commitment that we took in terms

of the scientific analysis that we conducted to complete that EIS.

We had some challenges, though, and we worked with a consultant

on how to make that document something that would be very easy

for the public to read, because it is very important for us as a regulatory agency in terms of the public confidence in the system and

in terms of our making sure that we are complying with NEPA to

the spirit of NEPA that document can be as very transparent and

can be read well. And I think what we heard from Judge Breyer

was the recognition that we need to look at those environmental

impacts, but the critical thing for us to consider is the environmental impacts, and then we are considering the economic impacts

as they relate to the environment. So that would make sense that

the environmental is the main core of your EIS. One thing, though,

that we should clarify, too, is that Judge Breyer’s decision was on

a product-specific EIS as opposed to our programmatic EIS, which

is on our full regulatory system. And I would tell you, we place no

less importance on the analysis wherever it is in the document. We

did all that analysis, conducted that all in a very comprehensive

way over a period of years. And the fact that it ended up in an appendix was really more of a decision to help the document be easier

to read.

Mr. KUCINICH. OK. We have a 310-page document we are talking

about here. There is an assertion, on page 121, ‘‘four factors were

considered in the evaluation of biological impacts: too negative of

an impact; the geographic extent; its duration and frequency; and

the likelihood of its taking place.’’ There was no mention of economic impacts, or take the fact that apart from the 10-page appendix, there are only five mentions of the phrase socioeconomic imVerDate 11-MAY-2000 10:29 Jun 05, 2009 Jkt 000000 PO 00000 Frm 00100 Fmt 6633 Sfmt 6633 U:\DOCS\49777.TXT KATIE PsN: KATIE
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pacts and only 10 mentions of the word contamination. I am just

wondering, in light of Judge Breyer’s decision, if economic impacts

of contamination should have been integrated into the body of the

EIS and the analysis of significance and had been discussed more

extensively. It still makes me wonder, did you really get the message when I don’t see it discussed in any extensive manner?

Ms. SMITH. I would say one point is that it is important to recognize, in order for us to do good analysis, we have to have enough

specificity in what we are analyzing——

Mr. KUCINICH. Indeed.

Ms. SMITH [continuing]. To be able to project. So where we are

going to have the ability to have much more specificity is going to

be on a crop-specific EIS as opposed to a programmatic. In the programmatic EIS, we have to look very broadly at the whole regulatory system and look very broadly at the kinds of issues we are

evaluating. And then what we will be doing is using this as the

basis to tier to very specific crop-based analysis. In addition, it is

important to recognize that when we issue our proposed rule,

which we hope to do before too long, there will be a separate very

specific economic analysis that will associate, be associated with

the issuance of that rule.

Mr. KUCINICH. When you say separate——

Ms. SMITH. We are required to publish at the same time an economic analysis as one of the types of analysis that accompany a

proposed regulation.

Mr. KUCINICH. Well, thank you. As you know, the USDA has prepared a draft programmatic environmental impact statement pursuant to its plan to rewrite its regulations for GE organisms. In the

future, when USDA is operating under new regulations, you will

again face many petitions for permitting field trials and for the deregulation of GE crops. Does anything in your proposed regulations

change the kinds of decisions that are subject to preparing an EA

or an EIS?

Ms. SMITH. Does the—do our new regulation changes——

Mr. KUCINICH. Anything in your proposed regulations change the

kinds of decisions that are subject to either an EA or an EIS?

Ms. SMITH. We have not finalized the regulation yet, so we can’t

speak to exactly what is in it.

Mr. KUCINICH. OK.

Ms. SMITH. But what we will have is a significant amount of information, a broader regulatory system, one that is based on tiers,

a multi-tiered risk-based permitting system. And so the kinds of

decisions, depending upon what tier you are in, will be what will

determine—they will differ depending upon what the crop is that

you are looking at. So if you are looking at a crop that has more

risk, potential risk, associated with it or less familiarity, then in

those cases, it is more likely that we will be conducting a higher

level of analysis.

Mr. KUCINICH. You know, what we are interested in as a subcommittee is under what circumstances you will or would assert

that your preparation for a programmatic EIS would relieve APHIS

of the requirement to prepare an EA or an EIS.

Ms. SMITH. Oh, no, it would not be our intention to develop—

make these regulation changes to do anything that would be conVerDate 11-MAY-2000 10:29 Jun 05, 2009 Jkt 000000 PO 00000 Frm 00101 Fmt 6633 Sfmt 6633 U:\DOCS\49777.TXT KATIE PsN: KATIE
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trary to CEQ regulations or our own NEPA-implementing regulations, whether it is developing this EIS and regulations or others.

Mr. KUCINICH. Thank you. I would like to talk about isolation

distances.

Ms. SMITH. OK.

Mr. KUCINICH. In connection with this, I have a letter that I am

going to submit for the record without objection. It is a memorandum to USDA APHIS Regulatory Analysis and Development. Just

for the purposes of the staff, it is dated May 31, 2005. Can we

make sure they have a copy of that? Mr. Gregoire, would the staff

make sure Mr. Gregoire has a copy of this so you know what we

are putting in the record in case you have anything that you want

to comment on it.

Ms. Smith, as you know, Federal, State and private rice research

programs operate a specialized nursery called the Rice Quarantine

Nursery near Plymouth, North Carolina, where potentially useful

traits are taken from rights germplasm from foreign sources. This

activity is obviously sensitive. The germplasm in soil at the nursery

could become contaminated, and/or an unauthorized release from

the nursery could cause a very serious contamination of the U.S.

commercial rice supply. For these reasons, the nursery was located

650 miles east of any commercially produced rice crop. The location

was selected, in other words, to isolate the nursery spatially from

commercial rice production to prevent contamination.

In 2005, Ventria Bioscience applied to APHIS to field test genetically engineered pharmaceutical rice on a large scale in close proximity to the rice quarantine nursery. APHIS prepared an environmental assessment of the application and concluded there would be

no significant impact and approved the application. Now, right

here, this document that I will submit for the record is a memorandum protesting the deficiencies of the EA. It comes from a USDA

research leader with the Agricultural Research Plant Science Research Unit. So, again, without objection. Specifically, this memorandum alerted APHIS that its EA had failed to consider the potential of, one, Ventria’s field tests introducing pathogens that

would imperil the Rice Quarantine Nursery; and two, Ventria’s

field tests posed a small risk that stray rice pollen could be carried

by wind currents into the Rice Quarantine Nursery. Could you tell

us, if you recall, how did APHIS regard the concerns raised in this

memorandum?

[The information referred to follows:]

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Ms. SMITH. I know we took these concerns seriously. I remember

us talking about it within the staff. I remember one of our division

directors talking with Mr. Marshall, contacting him about the situation. I can’t tell you, I will have to get information back to you

on how we resolved this issue.

Mr. KUCINICH. That would be great. I am wondering if you performed additional analysis in the areas identified as deficient. I

want to know if you prepared a full blown environmental impact

statement. I want to know what the evidence that APHIS took a

serious look at the environmental economic impacts identified in

the memorandum. And what I am actually asking for is the entire

record of that communication to be delivered to the subcommittee

so that we can see how that was handled. I would appreciate your

cooperation on that.

Ms. SMITH. OK. Sure. I will tell you that this year we are in the

process right now of doing an environmental assessment for that

same crop in that same area. So we can provide you with that as

well.

Mr. KUCINICH. That would be very helpful. And your cooperation

is appreciated.

Ms. SMITH. Sure.

Mr. KUCINICH. As you know, APHIS considers applications to release pharmaceutical and industrial crops through its permit process. Pharmaceutical crops are genetically engineered to produce a

drug or a component of a drug for the pharmaceutical industry.

That review process is more rigorous than the notification process,

reflecting the greater risk posed by pharmaceutical crops. What

would be the likely consequences to farmers if a contamination

event occurred involving a pharmaceutical crop?

Ms. SMITH. Let me tell you a little bit about, there was a situation that occurred previously involving a company, and our inspectors identified for that company that problem that happened. The

company had three different problems that came up where they

didn’t fully comply with our requirements. And in each case, our

inspectors were on hand to identify for the company that they

were—they had created a problem and that they would have to address it. In this situation, despite the fact that our inspectors found

the problems, told them about the problems—we gave them clear

information on how to address the problems. It created a situation

in which some soybeans were contaminated as a result. We took

very quick action. We stopped the movement of those soybeans in

place so that they didn’t move into the food supply. But as a result,

we had been in the process of putting together a variety of—a very

good evaluation of how we should be regulating field testing of

pharmaceutical and industrial types of crops. And we came out

with both a new regulation that required our—new requirements

to apply to all crops that contained industrial genes. And we also

put new requirements in place that year where we significantly increased both our oversight as well as the requirements on the company. And so an example of the oversight we put in place for us

is, while low-risk crops are—a percentage of low-risk crops are personally inspected by APHIS inspectors, these that we have less familiarity with, so they could potentially have more risk associated,

we made a decision that for each of these pharmaceutical field

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trials that we would inspect seven times or more for each of these

inspections. And the way we came up with those inspections was

that we thought about what each of the critical control points or

the critical decision points were in that research they were conducting.

Mr. KUCINICH. Is this the area—excuse me if you had mentioned

this, because I got paged, and we have a vote come up.

Ms. SMITH. OK.

Mr. KUCINICH. Is this the case where APHIS had to buy about

half a million bushels of soybeans in order to keep them from going

to market?

Ms. SMITH. This is the case where the company didn’t have

enough assets to immediately cover the cost of the destruction of

those soybeans. And so, in order to hold them accountable so that

they had to pay close to $4 million in expenses to destroy them, we

paid for the cost first, and then, as we do in our types of plant

health situations, they entered into a contract with us to repay us

back that money.

Mr. KUCINICH. How were they destroyed?

Ms. SMITH. How were they destroyed? Well, we took them to—

there was a local facility where they were burned in like an energy

facility. And APHIS inspectors oversaw the whole process to make

sure that is what happened to them. All of those soybeans were

burned.

Mr. KUCINICH. Did anyone do an environmental report on the destruction of half a million bushels of pharmaceutical crops?

Ms. SMITH. I remember that we were in consultation with the

Environmental Protection Agency, talking about what was acceptable from their perspective in terms of disposal.

Mr. KUCINICH. Did they give you any documentation? I mean, is

there anything documented——

Ms. SMITH. I will have to check and see.

Mr. KUCINICH. Is there any documentation on the exchange between you and the EPA on the destruction of these half a million

bushels? I would like to see that.

Ms. SMITH. All right.

Mr. KUCINICH. The committee would like that. Thank you.

And if this is the same case, tell me. Is this the Inspector General found a pharmaceutical crop growing as volunteers in a plot

of conventional soybeans, and then there was another State where

he found that a soybean field had been harvested before the pharmaceutical crop volunteers had been removed from the field?

Ms. SMITH. This is the same case, but it wasn’t the Inspector

General that found that. Those were APHIS inspectors who found

both of those problems and alerted the company to them.

Mr. KUCINICH. Staff just told me that APHIS inspectors may

have had company on their inspection from the Inspector General’s

Office. It is not something—it is something I have just been told.

Take it for what it is worth. It is just that the Inspector General

apparently has had some kind of a role here. What would have

happened, do you suppose, to the U.S. soybean industry if those

pharmaceutical crops had been detected in the marketplace?

Ms. SMITH. Well, I imagine it would have been problematic,

which is why we took such immediate action. I personally called

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the CEO of that company within minutes of us learning that they

had harvested those and sent them on to a grain elevator. And that

allowed us to stop them before they had a chance to move.

Mr. KUCINICH. What were those pharmaceutical crops? Do you

remember what were they? What were they growing?

Ms. SMITH. I will have to get that back to you. I don’t remember

now what the were.

Mr. KUCINICH. I would like to see that.

Ms. SMITH. OK.

Mr. KUCINICH. And how many instances do requests to—hold

on—how many times do you end up reviewing pharmaceutical crop

issues? Does that happen frequently? Is this like more of a concern

of APHIS now? Are you getting more and more pharmaceutical

crop inquiries and you have to do more testing? What is happening

with that?

Ms. SMITH. Actually, we could get you the numbers, but what

happened as a result of this particular event, this technology was

moving forward at a—it was really getting started in terms of moving forward, this technology of using plants to develop pharmaceutical or industrial proteins. As a result of the problem that was

associated with this company, and I think as part of the very serious action that we took, this company actually eventually went out

of business. And that gave, I think, a very clear message to the industry that this technology needed to be addressed very carefully.

In addition, the requirements that we have put in place have

slowed the technology as well, because—and what we have talked

about with the technology providers is, this is not just your average

biotech; this is very different. We need to have extreme isolations,

very stringent, extreme measures in place, and they need to approach this very differently, even to the point of what kinds of

farmers they offer to grow these kind of crops.

Mr. KUCINICH. I am glad to hear that you are trying to keep

apace of this very specific technology. And what the subcommittee

is going to do is to be working with your staff so that we can be

able to determine who is applying for the permission to grow what

kind of pharmaceutical crops, where they are being grown, what

kind of permission, when the permission was granted, and looking

at any studies that may exist of any complaints that may have

come from farmers, you know, a distance to see if it is possible

that—to see if the isolation has kept the crop intact.

Ms. SMITH. Sure.

Mr. KUCINICH. Because, you know, we are talking about pollination by insects, by wind, whatever. I just want you to know we

are going to move toward that a little bit more. I want to thank

you for your testimony. Mr. Issa has questions that he is submitting for the record. The subcommittee will give to you some followup questions. And we will be in touch on this. I want to thank you,

Ms. Smith, for the forthcoming nature of your presentation. It is

refreshing and much appreciated. So we will continue this dialog

with your agency. And I want to thank all the members of your

staff, Mr. Gregoire, for their presence here. We will continue our

interest in this.

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And at this point, this committee stands adjourned.

Ms. SMITH. Thank you, sir.

[The information referred to follows:]

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[Whereupon, at 5:12 p.m., the subcommittee was adjourned.]

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