98 Annual Report of the Secretary of Agriculture

 FY 1998 Report of the Secretary of 

Agriculture 

United States Department of Agriculture Office of Communications

USDA: Preparing for a New Millennium

[full report for printing]

Contents

Foreword, by Dan Glickman, Secretary of Agriculture 

1998 Accomplishments—Year at a Glance

Introduction

1. Increasing Production, Trade, and Opportunities for 

Family Farmers

● Farm Service Agency

● Foreign Agricultural Service

● Risk Management Agency

2. Providing More Tools for the Wise Stewardship of the 

Land

● Forest Service

● Natural Resources Conservation Service

3. Feeding More Children and Families

● Food and Nutrition Service

● Center for Nutrition Policy and Promotion

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98 Annual Report of the Secretary of Agriculture

4. Raising Consumers' Confidence in Food Safety

● Food Safety and Inspection Service

5. Creating Jobs and Revitalizing the Economy in Rural Areas

● Rural Business - Cooperative Service

● Rural Community Development

● Rural Housing Service

● Rural Utilities Service 

6. Investing in the Future Through Research, Education, and Economics

● Agricultural Research Service

● Cooperative State Research, Education, and Extension Service

● Economic Research Service

● National Agricultural Statistics Service

7. Promoting Quality and Fair Trade Through Marketing and Regulatory Services

● Agricultural Marketing Service

● Animal and Plant Health Inspection Service

● Grain Inspection, Packers and Stockyards Administration

8. Providing Administrative and Executive Support to the Department and Its Clients

● Office of Inspector General

● Office of Chief Financial Officer

● Office of the Chief Information Officer

● Office of the Chief Economist

● Departmental Administration

*List of USDA agencies and acronyms

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98 Annual Report of the Secretary of Agriculture

The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities 

on the basis of race, color, national origin, gender, religion, age, disability, political beliefs, sexual 

orientation, and marital or family status. (Not all prohibited bases apply to all programs.) Persons with 

disabilities who require alternative means for communication of program information (Braille, large 

print, audiotape, etc.) should contact USDA’s TARGET Center at (202) 720-2600 (voice and TDD).

To file a complaint of discrimination, write USDA, Director, Office of Civil Rights, Room 326- W, 

Whitten Building, 14th and Independence Avenue, SW, Washington, DC 20250-9410 or call (202) 720-

5964 (voice or TDD). USDA is an equal opportunity provider and employer.

Mention or depiction of commercial products in this report does not constitute endorsement by the U.S. 

Department of Agriculture over other products and organizations not mentioned or depicted.

Foreword

by Dan Glickman, Secretary of Agriculture

As we all know, 1998 brought crises to American farmers—economic downturns in Asia 

and Russia, strong overseas production, and poor weather across broad regions of the 

United States pushed down prices to farmers to levels not seen in decades. As we go to 

press in 1999, that unhappy trend continues. 

I am proud that our Nation rallied behind President Clinton to help the family farmer. We 

passed a strong emergency relief package for farmers. USDA has responded to the 

situation and has made roughly $17.7 billion in direct payments to America’s family 

farmers for their 1998 crops, and $1.6 billion in payments have been made under Federal 

crop insurance. 

In addition, USDA provided farmers with $3.2 billion to date in farm credit loans and 

approximately $7 billion in marketing assistance loans that helped offset income lost to 

lower prices. We provided much-needed assistance to pork producers and dairy farmers, 

and have stepped up efforts to combat anti-competitive practices that hit small farmers 

and ranchers the hardest.

In a year that saw demand drop off in overseas markets, USDA worked aggressively to 

shore up agricultural exports. We broke through 77 barriers to U.S. farm trade, helping 

open up $2.2 billion in export opportunities. We made a nearly 50-percent increase in 

export credit guarantee allocations, so we could be aggressive in holding on to some of 

our best customers. And, we committed over 8 million tons of food aid to help hungry 

people around the world and the American farmer here at home. 

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Food Safety 

This country’s food supply is the safest in the world. But with a growing world 

population, increased production, and threats from microbes never before seen, we need 

to make sure we have a food safety system for the future. This year we began 

implementing Hazard Analysis and Critical Control Points (HACCP), our new sciencebased meat and poultry inspection system, in the largest plants. Preliminary findings 

indicate that we’ve seen a dramatic reduction in levels of Salmonella in pork and chicken 

in these plants. 

Meanwhile our scientists continue to develop new ways to ensure food safety. This past 

year, I announced a new anti-Salmonella spray developed by USDA scientists that can 

help us come very close to eliminating Salmonella on the farm. And President Clinton 

established the Joint Institute for Food Safety Research and the President’s Council on 

Food Safety to coordinate all government activities on this front, and FORC-G 

(Foodborne Outbreak Response Coordination Group), a rapid response team for 

outbreaks of foodborne illness. 

America’s Anti-Hunger Department

As America’s anti-hunger Department, USDA through its nutrition programs helped feed 

1 in 10 Americans–including the 20 million people in this country who receive food 

stamps and the children who received 2.5 billion subsidized school meals. Our Special 

Supple-mental Nutrition Program for Women, Infants, and Children (WIC) provided 

nutritious food, nutrition education, and medical referrals to 7.4 million new moms, their 

infants, and young children. 

This Administration won a major victory when its proposal to extend child nutrition 

programs was adopted. The proposal included a major provision to expand after-school 

snack programs to help get at-risk kids off the streets and into productive environments. 

We also restored food stamp benefits for our most vulnerable legal immigrants, including 

children and the elderly. 

USDA employees donated hundreds of thousands of pounds of food to the needy, while 

our field gleaning efforts got fresh produce to families in need. 

Protecting the Land

We’ve got to be careful that we don’t bite the land that feeds us. From expansion of our 

Wetlands Reserve Program to protect natural habitats ... to expansion of our Conservation 

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98 Annual Report of the Secretary of Agriculture

Reserve Enhancement Program to protect our water ... to an ambitious new forest road 

management effort that protects the environment while providing improved service to 

users ... to new technology that softens wood chips, thereby reducing environmental 

damage and energy costs and even producing stronger paper ... to protecting endangered 

American farmland from urban sprawl ... we are making wise stewardship of our natural 

resources a fundamental part of our daily lives.

Also, our folks in the Camino Real Ranger District won the Innovations in American 

Government Award—the most prestigious government award in the country—for 

bringing together deeply divided factions in a forest community.

Civil Rights

I’m proud to say that in our continuing efforts on civil rights we are making serious 

headway. We won a rare congressional waiver of the statute of limitations so we could 

settle old civil rights cases that we inherited—cases that had been sitting on the shelf for 

far too long. We beefed up our civil rights enforcement staff, hired a seasoned civil rights 

advocate as USDA’s Director of Civil Rights, and established a division of civil rights in 

our General Counsel’s office.

This is just a brief summary of our year at USDA. I urge you to look at the detailed 

material in this report. Now, I’d like to turn my attention to 1999.

Key Priorities for 1999

The famous phrase “what’s past is prologue” aptly characterizes how our 

accomplishments lay the foundation for a strong 1999. Last year we focused on relief for 

farmers in a crisis. Next year, we need to develop a sturdy risk management system 

centered around a strengthened crop insurance program. 

We need to build on our nutrition and anti-hunger activities by expanding our food rescue 

and gleaning efforts in our communities, expanding the School Breakfast Program, 

expanding the Child and Adult Care Food Program, and encouraging more grass-roots 

community involvement. 

Our tremendous progress on civil rights encourages us to intensify our commitment to 

making USDA the #1 civil rights department in government. 

On conservation we will continue our efforts to enhance our private land and clean water 

efforts throughout the Nation.

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98 Annual Report of the Secretary of Agriculture

As the department of rural America, we will continue to bring clean running water to 

rural citizens, help increase the already record-setting pace of home ownership, and 

provide rural residents with on-ramps to the Information Superhighway through our 

Distance Learning and Telemedicine Program.

For our dairy producers, we will move quickly to implement the dairy portion of the 

disaster bill and work to complete milk marketing order reform. 

The continuing advances made by our scientists in the past foreshadow the importance of 

research and technology in all aspects of USDA’s work, from food safety to nutrition to 

sustainable agriculture.

With a strong past to build on, I look forward to a very productive year to close out the 

century. I especially want to take this opportunity to thank the employees of USDA, 

whose diligence day in and day out is why I can report proudly what we’ve done in 1998.

Introduction

The mission of the U.S. Department of Agriculture (USDA) is to enhance the quality of 

life for the American people by supporting production agriculture; ensuring a safe, 

affordable, nutritious, and accessible food supply; caring for agricultural, forest, and 

range lands; supporting sound development of rural communities; providing economic 

opportunities for farm and rural residents; expanding global markets and services; and 

working to reduce hunger in America and throughout the world. Seven mission areas 

carry out USDA's mission: Farm and Foreign Agricultural Services; Food Nutrition, and 

Consumer Services; Food Safety; Marketing and Regulatory Programs; Natural 

Resources and Environment; Research, Education, and Economics; and Rural 

Development. USDA has identified in its 1997-2002 Strategic Plan three strategic goals 

for USDA's policies and programs: (1) expand economic and trade opportunities for 

agricultural producers and other rural residents; (2) ensure food for the hungry, and a 

safe, affordable, nutritious, and accessible food supply; and (3) promote sensible 

management of our natural resources.

USDA Agencies and Acronyms

● AMS - Agricultural Marketing Service

● ARS - Agricultural Research Service

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● APHIS - Animal and Plant Health Inspection Service

● CNPP - Center for Nutrition Policy and Promotion

● CSREES - Cooperative State Research, Education, and Extension Service

● ERS - Economic Research Service

● FAS - Foreign Agricultural Service

● FNS - Food and Nutrition Service

● FS - Forest Service

● FSA - Farm Service Agency

● FSIS - Food Safety and Inspection Service

● GIPSA - Grain Inspection, Packers and Stockyards Administration

● NASS - National Agricultural Statistics Service

● NRCS - Natural Resources Conservation Service

● RBS - Rural Business - Cooperative Service

● RHS - Rural Housing Service

● RMA - Risk Management Agency

● RUS - Rural Utilities Service

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98 Annual Report of the Secretary of Agriculture

 FY 1998 Report of the Secretary of 

Agriculture 

United States Department of Agriculture Office of Communications

USDA: Preparing for a New Millennium

Contents

Foreword, by Dan Glickman, Secretary of Agriculture 

1998 Accomplishments—Year at a Glance

Introduction 

1. Increasing Production, Trade, and Opportunities for Family 

Farmers

● Farm Service Agency

● Foreign Agricultural Service

● Risk Management Agency

2. Providing More Tools for the Wise Stewardship of the Land

● Forest Service

● Natural Resources Conservation Service

3. Feeding More Children and Families

● Food and Nutrition Service

● Center for Nutrition Policy and Promotion

4. Raising Consumers' Confidence in Food Safety

● Food Safety and Inspection Service

5. Creating Jobs and Revitalizing the Economy in Rural Areas

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98 Annual Report of the Secretary of Agriculture

● Rural Business - Cooperative Service

● Rural Community Development

● Rural Housing Service

● Rural Utilities Service 

6. Investing in the Future Through Research, Education, and Economics

● Agricultural Research Service

● Cooperative State Research, Education, and Extension Service

● Economic Research Service

● National Agricultural Statistics Service

7. Promoting Quality and Fair Trade Through Marketing and Regulatory Services

● Agricultural Marketing Service

● Animal and Plant Health Inspection Service

● Grain Inspection, Packers and Stockyards Administration

8. Providing Administrative and Executive Support to the Department and Its Clients

● Office of Inspector General

● Office of Chief Financial Officer

● Office of the Chief Information Officer

● Office of the Chief Economist

● Departmental Administration

* List of USDA agencies and acronyms

Foreword

by Dan Glickman, Secretary of Agriculture

As we all know, 1998 brought crises to American farmers—economic downturns in Asia and 

Russia, strong overseas production, and poor weather across broad regions of the United States 

pushed down prices to farmers to levels not seen in decades. As we go to press in 1999, that 

unhappy trend continues. 

I am proud that our Nation rallied behind President Clinton to help the family farmer. We 

passed a strong emergency relief package for farmers. USDA has responded to the situation 

and has made roughly $17.7 billion in direct payments to America’s family farmers for their 

1998 crops, and $1.6 billion in payments have been made under Federal crop insurance. 

In addition, USDA provided farmers with $3.2 billion to date in farm credit loans and 

http://www.usda.gov/news/pubs/98arp/fullrpt.htm (2 of 64) [10/15/2004 9:34:09 AM]
98 Annual Report of the Secretary of Agriculture

approximately $7 billion in marketing assistance loans that helped offset income lost to lower 

prices. We provided much-needed assistance to pork producers and dairy farmers, and have 

stepped up efforts to combat anti-competitive practices that hit small farmers and ranchers the 

hardest.

In a year that saw demand drop off in overseas markets, USDA worked aggressively to shore 

up agricultural exports. We broke through 77 barriers to U.S. farm trade, helping open up $2.2 

billion in export opportunities. We made a nearly 50-percent increase in export credit 

guarantee allocations, so we could be aggressive in holding on to some of our best customers. 

And, we committed over 8 million tons of food aid to help hungry people around the world 

and the American farmer here at home. 

Food Safety 

This country’s food supply is the safest in the world. But with a growing world population, 

increased production, and threats from microbes never before seen, we need to make sure we 

have a food safety system for the future. This year we began implementing Hazard Analysis 

and Critical Control Points (HACCP), our new science-based meat and poultry inspection 

system, in the largest plants. Preliminary findings indicate that we’ve seen a dramatic 

reduction in levels of Salmonella in pork and chicken in theye plants. 

Meanwhile our scientists continue to develop new ways to ensure food safety. This past year, I 

announced a new anti-Salmonella spray developed by USDA scientists that can help us come 

very close to eliminating Salmonella on the farm. And President Clinton established the Joint 

Institute for Food Safety Research and the President’s Council on Food Safety to coordinate 

all government activities on this front, and FORC-G (Foodborne Outbreak Response 

Coordination Group), a rapid response team for outbreaks of foodborne illness. 

America’s Anti-Hunger Department

As America’s anti-hunger Department, USDA through its nutrition programs helped feed 1 in 

10 Americans–including the 20 million people in this country who receive food stamps and the 

children who received 2.5 billion subsidized school meals. Our Special Supple-mental 

Nutrition Program for Women, Infants, and Children (WIC) provided nutritious food, nutrition 

education, and medical referrals to 7.4 million new moms, their infants, and young children. 

This Administration won a major victory when its proposal to extend child nutrition programs 

was adopted. The proposal included a major provision to expand after-school snack programs 

to help get at-risk kids off the streets and into productive environments. We also restored food 

stamp benefits for our most vulnerable legal immigrants, including children and the elderly. 

USDA employees donated hundreds of thousands of pounds of food to the needy, while our 

field gleaning efforts got fresh produce to families in need. 

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98 Annual Report of the Secretary of Agriculture

Protecting the Land

We’ve got to be careful that we don’t bite the land that feeds us. From expansion of our 

Wetlands Reserve Program to protect natural habitats ... to expansion of our Conservation 

Reserve Enhancement Program to protect our water ... to an ambitious new forest road 

management effort that protects the environment while providing improved service to users ... 

to new technology that softens wood chips, thereby reducing environmental damage and 

energy costs and even producing stronger paper ... to protecting endangered American 

farmland from urban sprawl ... we are making wise stewardship of our natural resources a 

fundamental part of our daily lives.

Also, our folks in the Camino Real Ranger District won the Innovations in American 

Government Award—the most prestigious government award in the country—for bringing 

together deeply divided factions in a forest community.

Civil Rights

I’m proud to say that in our continuing efforts on civil rights we are making serious headway. 

We won a rare congressional waiver of the statute of limitations so we could settle old civil 

rights cases that we inherited—cases that had been sitting on the shelf for far too long. We 

beefed up our civil rights enforcement staff, hired a seasoned civil rights advocate as USDA’s 

Director of Civil Rights, and established a division of civil rights in our General Counsel’s 

office.

This is just a brief summary of our year at USDA. I urge you to look at the detailed material in 

this report. Now, I’d like to turn my attention to 1999.

Key Priorities for 1999

The famous phrase “what’s past is prologue” aptly characterizes how our accomplishments lay 

the foundation for a strong 1999. Last year we focused on relief for farmers in a crisis. Next 

year, we need to develop a sturdy risk management system centered around a strengthened 

crop insurance program. 

We need to build on our nutrition and anti-hunger activities by expanding our food rescue and 

gleaning efforts in our communities, expanding the School Breakfast Program, expanding the 

Child and Adult Care Food Program, and encouraging more grass-roots community 

involvement. 

Our tremendous progress on civil rights encourages us to intensify our commitment to making 

USDA the #1 civil rights department in government. 

On conservation we will continue our efforts to enhance our private land and clean water 

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98 Annual Report of the Secretary of Agriculture

efforts throughout the Nation.

As the department of rural America, we will continue to bring clean running water to rural 

citizens, help increase the already record-setting pace of home ownership, and provide rural 

residents with on-ramps to the Information Superhighway through our Distance Learning and 

Telemedicine Program.

For our dairy producers, we will move quickly to implement the dairy portion of the disaster 

bill and work to complete milk marketing order reform. 

The continuing advances made by our scientists in the past foreshadow the importance of 

research and technology in all aspects of USDA’s work, from food safety to nutrition to 

sustainable agriculture.

With a strong past to build on, I look forward to a very productive year to close out the 

century. I especially want to take this opportunity to thank the employees of USDA, whose 

diligence day in and day out is why I can report proudly what we’ve done in 1998.

1998 Accomplishments—Year at a Glance 

Our USDA successes for 1998 included—

Expanding opportunities and assistance for America’s family farmers 

● President Clinton fought for and won a strong emergency assistance package for America’s 

farmers—one that includes 40 percent more funds than the original bill he vetoed. Nearly $3 billion in 

assistance reached farmers before Thanksgiving, and an additional $3 billion will be distributed before 

spring 1999.

● USDA’s Commodity Credit Corporation (CCC) made commodity loans of about $7.2 billion to 

producers, $1.6 billion higher than last fiscal year. To offset lost farm income, CCC will also make 

about $2.8 billion in loan deficiency payments, and marketing loan gains on 1997 and 1998 crops. 

● Using sound science, USDA broke through 77 barriers stifling U.S. farm trade, enabling $2.2 billion in 

threatened and new agricultural trade opportunities to take place. Carrying out President Clinton’s Food 

Aid Initiative, the Department began purchases of more than 185 million bushels of wheat for donation 

to hungry people around the world. We increased by 40 percent—to $4 billion—the export sales 

registered under our export credit guarantee programs. This enabled U.S. exporters to complete sales of 

201 million bushels of wheat, 227 million bushels of corn, 104 million bushels of soybeans, and nearly 

2 million bales of cotton. 

● USDA led successful discussions with Canada about access for U.S. wheat, cattle, hogs, and other trade 

issues. USDA opened the Taiwanese market for U.S. pork, poultry, and beef—and reopened Brazil’s 

market for U.S. wheat. 

● USDA’s Farm Loan Program provided over $2.1 billion in assistance to over 26,000 family farmers in 

FY 1998. About $367.1 million of these funds helped 3,186 minority and women farmers. And more 

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than $490 million in direct loan assistance benefitted over 7,000 beginning farmers this fiscal year, a 6-

percent increase. 

● USDA responded quickly when farmers suffered devastating losses, approving disaster designations for 

counties in 43 States. The Department made over $97.5 million in low-interest emergency loans and 

disbursed $26.5 million in emergency conservation funds. USDA provided $22.9 million in emergency 

benefits to farmers with uninsurable crops, $2.8 million to orchard and vineyard owners, and $4.9 

million to livestock producers. 

● USDA added economic and legal expertise to strengthen investigations of anticompetitive practices that 

hit small farmers and ranchers hardest. 

● To help avert a repeat of 1997’s gridlock in rail transportation, USDA hosted a National Summit on 

Agricultural Transportation, which set the groundwork for a comprehensive plan to meet agriculture’s 

long-term transportation needs. The Department also created an early warning system to anticipate 

demand for railcars by grain shippers. 

● USDA proposed the first rule on national standards for organic foods, using the Internet in an 

unprecedented public review and comment process. The Secretary also offered a proposal to reform 

Federal dairy policies. 

● For the first time, USDA—not the U.S. Bureau of the Census—conducted the census of agriculture. 

And, for the first time, all farmers on American Indian reservations were counted. 

● USDA took new steps to improve the safety net for farmers, expanding crop insurance to new crops and 

new areas. More than $1.4 billion in crop insurance indemnities—a record—were paid out to farmers. 

Creating jobs and helping to revitalize rural America

● USDA helped 68,000 rural Americans buy homes and created or saved 215,000 rural jobs in 1998. The 

Department invested more than $9 billion in rural development projects. In FY 1998, USDA invested 

$4 billion to help rural Americans buy or build single-family houses, making the dream of home 

ownership a reality for 68,000 households. 

● USDA also helped renters, spending $219 million for loans and grants for the construction of 3,942 

affordable apartment units and the repair or upgrade of 5,682 apartments in rural areas. USDA provided 

$545 million to help low-income rural renters. 

● USDA provided $286 million in loans and grants to build or expand community facilities that benefit 

more than 2.7 million rural residents. These investments include more than $110 million for 147 rural 

health care facilities, $13 million for 46 child care centers, and $36 million for 262 fire and rescue 

facilities. Another $54 million helped develop other community resources, including job training 

facilities, libraries, and courthouses. 

● At $60 million, USDA loans to rural cooperatives nearly doubled this year. The Department has 

earmarked $200 million for funding co-ops in 1999. 

● USDA provided $1.3 billion in loans and grants to build or improve 1,021 water and sewer systems, 

helping to bring clean, safe drinking water to more than 2 million rural Americans. 

Ensuring wise stewardship of the land 

● CCC expanded the Conservation Reserve Enhancement Program to help six States, protecting New 

York’s drinking water as well as habitats for endangered salmon and trout in the Pacific Northwest. 

● CCC enrolled 211, 917 acres in the Wetlands Reserve Program in fiscal year 1998. This brings the total 

area that is being restored and protected under the program to 665,447 acres. 

● USDA began implementing the Wildlife Habitat Incentives Program in fiscal year 1998. Landowners 

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enrolled more than 670,000 acres in long-term agreements under the new program, in return for 

technical and financial assistance from USDA. 

● USDA provided technical assistance to more than 740,000 farmers, ranchers, other land users, and units 

of government. As a result of these services, the planning decisions and management applied by 

resource managers on about 61 million acres of agricultural and other rural land will help to sustain 

resource productivity and enhance environmental quality. 

● USDA provided $17.2 million to 19 States through the Farmland Protection Program, leveraging about 

$95 million in state and local funds, to preserve endangered American farmland.

● The USDA funds helped acquire permanent easements to preserve almost 45,700 acres in agricultural 

use. Over the 3 years of the program, more than 127,000 acres have been protected. 

● USDA worked with State and local governments and other Federal agencies to begin implementation of 

the President’s Clean Water Action Plan. Unified Watershed Assessments were completed in every 

State to identify watersheds with the most critical water quality concerns and to develop strategies to 

improve water quality in high priority watersheds. In addition, USDA and the U.S. Environmental 

Protection Agency developed a draft Unified National Strategy for Animal Feeding Operations (AFO’s) 

and released it for public comment. The Strategy identifies national performance expectations for AFO 

owners that will reduce potential water quality risks posed by animal feeding operations. 

● USDA employees at the Camino Real Ranger District in New Mexico won the prestigious Innovations 

in American Government Award for unifying a deeply divided forest community. 

● USDA embarked on an ambitious natural resources agenda for the 21st century, setting clear priorities 

for scientists and managers and holding them accountable for sustaining the health of America’s forests 

and grasslands. 

● To prevent further damage by the dangerous Asian long-horned beetle, USDA banned untreated solid 

wood packing materials from China and helped remove more than 2,500 afflicted trees in New York. 

● USDA has lifted all Florida Mediterranean fruit fly quarantines, and no Mediterranean fruit flies have 

been detected in Florida since 1998. The Department is working toward its eradication in California to 

protect valuable fruit and vegetable crops. 

● The Department collected approximately $20 million from 65 recreation fee demonstration projects on 

national forests and grasslands in 1998. Most of these funds are used to maintain and improve trails, 

recreational facilities, visitor services, signs, and health and safety features for the forests’ and 

grasslands’ 800 million visitors. 

● USDA researchers developed an award-winning bio-pulping technology that uses wood-decay fungi to 

soften wood chips, eliminating environmental problems, reducing energy costs by at least 30 percent, 

and producing stronger paper. 

● In 1998, USDA launched a new approach to forest road management to improve service to users, 

protect environmental values, enhance public safety, reduce damage to the environment, and better 

serve local transportation needs. A moratorium was proposed on new road construction in certain 

unroaded national forest areas. 

Modernizing our food safety system, using science to ensure safety from farm to table 

● USDA implemented HACCP, the new, science-based food safety inspection system, in the Nation’s 

300 largest meat and poultry plants. Preliminary data indicate that the new system is already working, 

reducing Salmonella dramatically in pork and broiler chickens. 

● President Clinton established the President’s Council on Food Safety to coordinate resources and 

policies to better prevent foodborne illness. He also set up the Joint Institute for Food Safety Research 

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to ensure effective coordination of research among food safety agencies and FORC-G to ensure a rapid 

and effective government response to foodborne illness outbreaks. 

● USDA researchers developed an anti-Salmonella spray that may help poultry producers significantly 

reduce Salmonella contamination on the farm. They also created a new variety of corn that can reduce 

phosphorous in pig and chicken waste by 50 percent. 

Feeding America’s hungry children and families—and promoting food recovery 

● USDA nutrition assistance programs helped feed about 1 in 10 Americans. In 1998, nearly 20 million 

needy people received food stamps to help feed their families. More than half of the 5 billion school 

meals served to children this year were provided free or at a reduced price. And USDA’s WIC program 

provided nutritious supplemental foods to 7.4 million at-risk women, infants, and children to help 

ensure a healthier America.

● Congress passed President Clinton’s legislative proposal to reauthorize child nutrition programs, 

including an expansion of after-school snack programs so communities can move teens off the streets. 

The President also successfully fought for restored food stamp benefits for our most vulnerable legal 

immigrants, including children. 

● USDA’s Inspector General’s “Operation Talon” caught more than 3,500 fugitive felons, many of them 

violent offenders, who were former food stamp recipients. 

● USDA employees donated hundreds of thousands of pounds of food to community kitchens, and fieldoffice gleaning efforts delivered tons of fresh produce to families in need. 

Aggressively addressing long-standing civil rights issues 

● President Clinton and I won congressional passage of a waiver of a statute of limitations, so USDA 

could settle older civil rights cases. The Department restaffed its civil rights enforcement unit and cut in 

half the backlog of discrimination complaints. Civil rights training began for all employees. 

● The Office of Civil Rights investigated 131 program discrimination complaints in FY 1998. Its 

investigative unit had been eliminated in 1982, and no more than a handful of cases had been 

investigated annually since that time. 

Introduction

The mission of the U.S. Department of Agriculture (USDA) is to enhance the quality of life 

for the American people by supporting production agriculture; ensuring a safe, affordable, 

nutritious, and accessible food supply; caring for agricultural, forest, and range lands; 

supporting sound development of rural communities; providing economic opportunities for 

farm and rural residents; expanding global markets and services; and working to reduce 

hunger in America and throughout the world. Seven mission areas carry out USDA's mission: 

Farm and Foreign Agricultural Services; Food Nutrition, and Consumer Services; Food Safety; 

Marketing and Regulatory Programs; Natural Resources and Environment; Research, 

Education, and Economics; and Rural Development. USDA has identified in its 1997-2002 

Strategic Plan three strategic goals for USDA's policies and programs: (1) expand economic 

and trade opportunities for agricultural producers and other rural residents; (2) ensure food for 

the hungry, and a safe, affordable, nutritious, and accessible food supply; and (3) promote 

sensible management of our natural resources.

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98 Annual Report of the Secretary of Agriculture

1. Increasing Production, Trade, and Opportunities for Family Farmers

Farm Service Agency 

Mission

Farm Service Agency’s mission is to ensure the well-being of American agriculture and the American public 

through efficient and equitable administration of farm commodity, farm loan, conservation, environmental, 

emergency assistance, and domestic and international food assistance programs. 

Farm Safety Net

Farm Loan Program

In FY 1998, the Farm Service Agency (FSA) provided over $2.1 billion in loan assistance to over 26,000 

family farmers. The Agency:

● Provided $789 million in 15,620 direct loans, and $1.435 billion in 10,557 guaranteed loans to family 

farmers in rural America. 

● Provided $367.182 million direct and guaranteed loans to 3,186 minority and women farmers in FY 

1998, exceeding the targeted allocation set by Congress by 191 percent. 

● Provided over $490 million in direct loan assistance to more than 7,000 beginning farmers, a 6-percent 

increase over FY 1997. 

● Published new proposed rule and developed final rule to streamline the procedures for lenders obtaining 

FSA loan guarantees. 

● Initiated new foreclosure and lending policies at USDA in an effort to assure that no farmers will lose 

their farm because of discrimination. 

● Developed new farm business plan software for use by customers on their home computers as well as 

by FSA employees. This software will help farmers develop yearly business plans to make their 

operations as efficient and profitable as possible. 

● Decreased direct farm loan delinquency from $2,124,682,363 in FY 1997 to $1,764,873,822 in FY 

1998. This is significant, considering the low commodity prices and adverse weather conditions that 

existed throughout the year. 

● Decreased the number of Farm Inventory properties from 1,131 in FY 1997 to 791 in FY 1998.

Guaranteed loan delinquency remained low at 2.63 percent, and guaranteed loan loss rate remained less than 1 

percent (.78). These figures are significant, considering the low commodity prices and adverse weather 

conditions that existed throughout 1998.

CCC Nonrecourse Marketing Assistance Loan and 

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Farm Forums

On April 3 in Lexington, Kentucky, Secretary Glickman 

kicked off the first of seven farm forums around the 

country. A crowd of 700 farmers, local and State officials, 

and agribusiness leaders were mainly interested in tobacco 

issues. Deputy Secretary Richard Rominger had a farm 

forum April 3 in Orono, Maine, where over 250 farmers 

raised concerns about dairy policy, Canadian imports, and 

ice damage. On April 6 Deputy Secretary Rominger spoke 

to over 200 farmers in Greenville, Florida. On April 7, 

Secretary Glickman met with over 200 farmers in Las 

Cruces, New Mexico, and Deputy Secretary Rominger met 

with nearly 200 farmers in Salinas, California, the same 

day about dairy and pesticide concerns. In Aberdeen, South 

Dakota, Secretary Glickman talked with farmers about 

cattle prices and wheat issues, and on April 8 in Ames, 

Iowa, Secretary Glickman and Deputy Secretary Rominger 

hosted another town hall meeting with 500 farmers on the 

campus of Iowa State University.

Loan Deficiency Payment Program

Nonrecourse marketing assistance loans, for which 

production of a commodity serves as collateral, allow 

farmers to pursue alternative marketing strategies at a 

time when prices typically are at the seasonal harvesttime lows. Loan deficiency payments (LDP’s), an 

option to loans, provide eligible producers with direct 

payments when prices are low.

CCC made the following efforts in fiscal year 1998 to 

help offset farm income losses due to low prices and 

the adverse effect of natural conditions on the quality 

of farmers’ output:

● Made a total of $7.2 billion in marketing assistance 

loans to producers. This was $1.9 billion higher than 

the previous fiscal year, when prices were generally 

much higher. 

● Held forfeitures to a fraction of the levels observed 

in the mid-1980’s when crop prices were also low. 

● Broadened the eligibility for marketing loans and loan deficiency payments. For example, the change 

allowed producers who harvested corn for silage to be eligible for marketing assistance loans and 

LDP’s and for producers with sample grade wheat, contaminated corn, or other below grade 

commodities also to be eligible for these benefits. 

● In September 1998 made $3.2 billion in final Production Flexibility Contract payments for FY 1998, 

bringing the total for the fiscal year to $5.66 billion. 

USDA Responds to Natural Disasters Hurting 

Agriculture

● In June 1998, CCC authorized emergency grazing 

of Conservation Reserve Program acreage in 

Montana, North Dakota, South Dakota, and Texas, 

where severe weather conditions had depleted hay 

supplies or impaired the growth of hay and pasture. 

In addition, FSA allocated $730,000 in Emergency 

Conservation Program funds to six Montana 

counties to help livestock producers provide water 

to livestock. 

● On July 9, Secretary Glickman declared Florida a 

disaster area, making farmers throughout the State 

eligible for low-interest emergency loans from 

FSA to recover from damage related to fire and 

drought. Also on July 9, the Secretary met with 

farmers and State agricultural officials in the 

Orlando area, to review the agricultural damage in 

the State. 

● In July, Secretary Glickman declared Georgia, 

Emergency Assistance

CCC and FSA have:

● Approved disaster designations for counties in 

43 States. 

● Developed the FSA Hay Net, a program 

helping producers in need of hay to connect 

with those that had it. 

● Approved haying and grazing of CRP acres in 

many States to allow producers to feed cattle in 

disaster-stricken areas. 

● Made over $97.5 million in low-interest 

emergency loans. 

● Disbursed $26.5 million in Emergency 

Conservation Program cost share assistance. 

● Disbursed $22.9 million in Noninsured Disaster 

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Florida, and many counties in Texas to be disaster 

areas, making farmers and ranchers in those places 

eligible for emergency loans from USDA. In 

addition, to alleviate the drought-induced forage 

shortage, CCC allowed farmers in Texas to use hay 

land enrolled in the Conservation Reserve Program 

on an emergency basis, and allowed emergency 

grazing in 10 other States for the same reason. 

● On July 28 and 29, Secretary Glickman toured 

farms hurt by the drought in Oklahoma and Texas 

to inspect drought damage and met with 

agricultural leaders and experts in College Station, 

Texas, to assess the economic implications of the 

disaster. 

● On July 29, Secretary Glickman held a round table 

on the drought and its effects on the Texas 

economy, with State officials, farmers, and 

academics at Texas A&M University. 

● Following the President’s announcement on July 

23, 1998, that Texas farmers and ranchers are 

eligible for low-interest loans from FSA to help 

them recover from the effects of natural disasters, 

Secretary Glickman on July 26 extended the same 

assistance to Oklahoma farmers and ranchers. 

● On August 5, Secretary Glickman declared the 

entire State of South Carolina a disaster area. By 

the beginning of August, CCC designated 143 

counties in 11 States allowing eligible producers to 

hay and graze Conservation Reserve Program 

acreage in response to feed shortage conditions. 

● Touring agricultural damage near Sydney, Texas, 

August 11, Secretary Glickman designated all or 

parts of Iowa, Montana, and Wyoming as disaster 

areas, making farmers and ranchers there eligible 

for low- interest economic emergency loans. 

Assistance Program benefits. 

● Disbursed $2.8 million in Tree Assistance 

Program benefits. 

● Disbursed $4.9 million in Livestock Indemnity 

Program payments. Administered additional 

programs to producers as a result of legislation 

providing over $6 billion for economic and 

natural disaster relief. In addition, as 

announced by the Vice President on January 8, 

1999, USDA will make about $50 million in 

direct cash payments to hog producers and 

increase funding by $80 million for the hog 

pseudorabies eradication program.

Conservation

Conservation Reserve Program

CCC has:

● Made the Conservation Reserve Program 

(CRP) more environmentally sensitive and 

sound. 

● Enrolled nearly 23 million acres of America’s 

most environmentally sensitive lands for 

protection in the CRP, freeing up millions of 

acres of cropland to be put back into 

production. 

● Broadened the Conservation Reserve 

Enhancement Program (CREP) using State and 

Federal resources to help solve environmental 

problems. This program provides a framework 

for CCC to work in partnership with States and 

local interests to meet State-specific 

environmental objectives. CREP proposals have already been approved in Maryland, Minnesota, 

Illinois, New York, Oregon, and Washington.

Food Relief Efforts and Food Security

● Continued to expedite shipment of food in response to natural disasters and economic hardship. FSA 

assisted in providing over 900,000 pounds of food to victims of Hurricane Georges in Puerto Rico. 

● Worked closely with the Agency for International Development (AID) to advance purchase a variety of 

commodities used under the provisions of Public Law 83-480 for food assistance overseas and store the 

products at a U.S. port for use in emergency situations. Over 37,000 metric tons of product were 

handled throughout the year. 

● Undertook special efforts to respond to several world emergency food situations. About 200,000 metric 

tons of assorted food were purchased and delivered to North Korea through the World Food Program. 

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In response to the crises in Indonesia, CCC purchased nearly 60,000 metric tons of food. This fall, the 

emergency appeal for the Balkans region which includes Serbia and Kosovo resulted in the emergency 

purchase of 15,000 metric tons of wheat flour. 

Conservation Reserve Enhancement Program

On August 26, Secretary Glickman announced $10.4 

million in CCC funding for the New York City Watershed 

Conservation Reserve Enhancement Program (CREP), a 

Federal-State initiative to protect New York City’s drinking 

water.

President’s Food Aid Initiative

In July, President Clinton announced a Food Aid 

Initiative under which surplus commodities that were 

removed from the domestic market by CCC were 

disposed of through donations.

This activity included:

● The purchase of 1.26 million metric tons (MT) of wheat which will be donated through various food aid 

programs. 

● Preparations to purchase another 3.74 million MT to meet the President’s goal of removing 5.0 million 

MT of wheat from domestic markets. 

Food Recovery

● In the fall of 1997, USDA hosted the first National Food Recovery and Gleaning Summit to bring 

together public interest groups, the private sector, farmers, and others to discuss hunger and food 

recovery. Summit participants set a national goal of increasing food recovery by 33 percent. As a result 

of the summit, FSA has initiated gleaning activities in at least 26 States. Crops gleaned include apricots, 

apples, blueberries, cabbage, cantaloupe, celery, cherries, sweet corn, cucumbers, grapefruit, green 

beans, melons, peaches, peas, peppers, potatoes, squash, strawberries, sweet potatoes, tomatoes, and 

wheat. 

● At least 14 new farmers markets were opened in at least 9 States.

Voice for Freer World Trade

On January 7, 1998, Secretary Glickman addressed the 

Oxford Farming Conference in Oxford, England. He 

reported on the status of the U.S. agricultural policy and 

discussed a number of other critical trade matters, including 

food safety standards based on sound science. He 

advocated moving world agricultural trade toward a “more 

open, free and fair global marketplace.” 

Civil Rights

● Trained 25,581 FSA employees (97 percent of 

total) on the Introduction to Civil Rights. 

● Developed a new system to process program 

complaints using a centralized factfinding 

office located in Montgomery, Alabama, which 

reports directly to FSA’s Office of Civil Rights 

and Small Business Utilization Staff (CR&SBUS). Now, cases are independently reviewed in the field 

and analyzed by the headquarters CR&SBUS within an average of 47 days. 

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Foreign Agricultural 

Service 

Mission

The mission of USDA’s Foreign 

Agricultural Service (FAS) is to 

serve U.S. agriculture’s international interests by expanding export opportunities for U.S. agricultural, fish, 

and forest products and by promoting world food security.

Export Initiative for North Dakota

The Foreign Agricultural Service, working with the North 

Dakota State Department of Agriculture and the MidAmerica International Agri-Trade Council, led an outreach 

effort to stimulate North Dakota’s value-added agricultural 

exports and support efforts to generate additional economic 

activity in the depressed agricultural sector of the State. In 

June, FAS completed an outreach mailing of export 

assistance materials to more than 1,200 agricultural 

processors and wholesalers in the State, including more 

than 400 grain establishments handling grain and soybean 

commodities.

USDA Goal: Expanding economic and trade 

opportunities for agricultural producers and other 

rural residents

In 1998, CCC made full use of its export credit 

guarantee programs to support U.S. exports; these 

programs were especially helpful in keeping U.S. 

products flowing to the troubled markets of South 

Korea and Southeast Asia. For FY 1998, CCC 

announced the availability of nearly $5.8 billion in 

GSM-102 credit guarantees, compared with $3.96 

billion in 1997. In FY 1998, export credit guarantee programs facilitated the sale of over $4 billion in U.S. 

agricultural products. 

Secretary Glickman reactivated the Export Enhancement Program (EEP) to partly compensate U.S. poultry 

producers for markets lost in Europe. He also announced an EEP initiative for barley in response to the 

European Union’s heavily subsidized sale of barley into the U.S. market. Under the Dairy Export Incentive 

Program, Secretary Glickman has authorized export bonuses up to the maximum volume and spending limits 

consistent with our World Trade Organization (WTO) obligations. 

Program Development Division, Export Credits 

Program Area 

Five employees in the FAS Export Credits area partnered 

with five private voluntary organizations to streamline the 

funding process to private organizations for humanitarian 

food distribution. This team is a great example of 

reinvention, and it won Vice President Gore’s Hammer 

Award. They cut cycle time from 41 to 7 business days, cut 

hands-off from 10 to 5 people, cut administrative costs by 

almost $1 million in 1 year, and increased U.S. 

commodities purchased and food distribution by 28 

percent.

USDA worked successfully to open, expand, and 

maintain markets for U.S. agriculture. In February, the 

United States and Taiwan signed a market access 

agreement that has Taiwan lifting its import bans and 

allowing access for U.S. pork, poultry, and variety 

meats. Upon Taiwan’s accession to the WTO, Taiwan 

will cut tariffs and open tariff-rate quotas on a range of 

agricultural products. In May, the WTO ruled that the 

European Union must bring its ban on meat from 

animals treated with growth-promoting hormones into 

compliance with the WTO panel and appellate body 

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rulings by May 13, 1999. USDA is working to address issues and ensure support for the safe use and trade of 

agricultural biotechnology products. USDA is working bilaterally with key trading partners such as Argentina, 

Chile, Japan, and Canada, as well as multilaterally through organizations such as the Asia Pacific Economic 

Cooperation (APEC) forum. 

The U.S. Government continues to implement two major trade agreements–the Uruguay Round Agreement on 

Agriculture and the North American Free Trade Agreement (NAFTA)–as well as numerous bilateral 

agreements to open markets for U.S. agricultural products. U.S. exports to our two NAFTA partners–Canada 

and Mexico–continue to be a bright spot in the export picture. Exports to those two countries were expected to 

account for 24 percent of total U.S. agricultural exports in FY 1998.

Risk Management Efforts for Socially Disadvantaged 

Farmers

On March 24, USDA Risk Management Agency staff 

participated in a Risk Management Education Work Group 

with a community college and North Carolina Extension 

staff to design outreach activities directed to agribusiness 

and farmers, especially limited-resource and socially 

disadvantaged farmers, in an eight-county area in the 

Kenansville, North Carolina, area. Also on March 24-25, 

RMA staff attended the Native American Federal 

Resources Forum in Helena, Montana, showcasing how 

USDA’s programs can serve American Indians. 

Training under the Cochran Fellowship Program can have 

many positive impacts. For example, in 1993, You Xim 

Sun was the assistant manager of the Shanghai No. 1 

Provisions Store–a store owned by the Chinese 

government. While participating in the Cochran 

Fellowship Program, he learned about the possibilities of 

an open distribution system in a market economy. With 

this vision of the future in China, he left his job with the 

state-owned company and set up his own business. He now 

runs a successful company that imports food ingredients 

from the United States and other countries. 

Glenzie Kazi of South Africa participated in a horticultural 

training program under the Cochran Fellowship Program 

in 1996. After returning to South Africa, Ms. Kazi took 

over her father’s nursery business. With ideas she had 

learned in the United States, she bid for and won three 

large landscaping contracts. She hired 12 new employees 

and is training four students from the local agricultural 

school. 

 

To foster better agricultural trade and development cooperation, USDA is participating in bi-national 

commissions with key countries such as Argentina, Chile, Russia, South Africa, and Ukraine. This 

participation ensures that agricultural issues are represented in discussions with these key trading partners.

Since 1984, USDA’s Cochran Fellowship Program has provided U.S.-based training for over 6,060 

international participants from 56 countries worldwide--middle-income countries, emerging markets, and 

emerging democracies. Training opportunities are for senior- and mid-level specialists and administrators from 

the public and private sectors who are concerned with agricultural trade, agribusiness development, 

management, policy, marketing, and technology transfer. In FY 1998, 567 Cochran fellows from 48 countries 

received training in the United States.

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In 1998, FAS teamed up with the National FFA organization and the United Negro College Fund to provide 

college students with opportunities to work at agricultural offices in U.S. embassies overseas for up to 3 

months. In 1998, FAS offices in Argentina, Austria, Belgium, China, Morocco, Poland, Singapore, South 

Korea, Spain, Taiwan, and Venezuela participated in the program, providing training and work experience to 

15 college students interested in careers in international agricultural trade and related industries. 

On August 5, the U.S. embassy in Nairobi, Kenya, was destroyed by a terrorist bomb. A Kenyan citizen 

working for the FAS office was killed by the bomb blast, and three other FAS employees were injured. Newly 

enacted legislation will provide compensation to the hundreds of Kenyans who were injured and the families 

of those who were killed. In addition, USDA employees established a fund to help the victims of this tragedy.

Funding Risk Management Initiatives for Minority 

Farmers 

On June 26, USDA awarded an $85,000 grant to the 

Salinas, California, Rural Development Center to improve 

the risk management skills of more than 300 Latino family 

farmers. And on June 27, USDA awarded a $60,000 grant 

to develop a risk management education program to benefit 

Hmong and other Southeast Asian farmers as they begin 

farming careers near Fresno, California.

USDA Goal: Ensuring food for the hungry, and a 

safe, affordable, nutritious, and accessible food 

supply

The United States continues its strong commitment to 

the World Food Summit goal of reducing the number 

of undernourished people by half by the year 2015. 

The U.S. action plan, which will outline U.S. 

proposals to reduce hunger both in the United States 

and around the world, will be issued in early 1999.

In FY 1998, the United States provided about 3.5 million tons of food aid to needy countries. (Programs under 

which food aid is provided are: Titles I, II, and III of Public Law 480, the Food for Progress Program, and 

Section 416(b).) In addition to the food aid provided under these authorities, President Clinton in July 

announced a new Food Aid Initiative which is expected to provide 5.0 million metric tons of wheat and wheat 

products once fully implemented. The initial 2.5 million metric tons were allocated within 3 months.

USDA Goal: Effective customer service and efficient program delivery

FAS opened an office at the U.S.-Mexican border to help identify and resolve border trade issues that impede 

U.S. agricultural exports. The office, located in Nuevo Laredo, Mexico, also conducts outreach activities into 

border communities in the United States and Mexico to explain USDA trade programs. U.S. exporters sold 

more than $5 billion worth of agricultural products to Mexico in 1998, making Mexico our third largest export 

market. 

FAS also opened two new regional export assistance centers in 1998 in Atlanta, Georgia, and Sacramento, 

California. These offices are developing partnerships with key groups such as State departments of agriculture, 

universities, trade and economic development groups, State and local governments, regional trade centers, and 

food industry and farm organizations to alert them to overseas opportunities and sources of private and public 

export assistance. FAS also has export assistance offices in Des Moines, Iowa, and Portland, Oregon.

Risk Management Agency

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Mission

The Risk Management Agency will provide and support cost-effective means of managing risk for agricultural 

producers in order to improve the economic stability of agriculture.

In April 1998, Secretary Glickman announced steps that USDA would take to improve the safety net for U.S. 

farmers, including measures to improve the crop insurance program. During the year, the Risk Management 

Agency (RMA) began or accomplished these initiatives: (1) expanded crop insurance to new crops and new 

areas (ongoing); (2) suspended the controversial Nonstandard Underwriting Classification System (effective 

1999); (3) revised prevented planting provisions (effective 1999); (4) made coverage available more quickly 

(ongoing); and (5) developed new pilot programs providing producers with increased coverage (effective 

1999). 

RMA is committed to helping producers find efficient and affordable means of managing risk in order to 

improve the economic stability of agriculture. In 1998, the agency implemented new pilot programs for sweet 

potatoes, pecans, and avocado and mango trees, and approved pilot programs for watermelon, rangeland, wild 

rice, cherry, cabbage, winter squash, mustard, and crambe for the 1999 crop year. RMA also developed an 

innovative new revenue policy, raised coverage levels to 85 percent for various policies, revised its current 

nursery program, and made critical changes to several other existing crop policies. 

USDA Expands Crop Insurance Protection 

On May 8, the Federal Crop Insurance Corporation Board 

of Directors voted unanimously to authorize a pilot crop 

insurance program to increase coverage from 75 percent to 

up to 85 percent of a farmer’s individual yield; to expand 

the income protection pilot plan for wheat to include all of 

Montana, Oregon, South Dakota, and Washing-ton; to 

expand the group Risk Plan crop insurance pilot to test 

rangeland in 12 Montana counties; to approve a new pilot 

program for avocado fruit in Dade County, Florida; and to 

make several improvements to the Crop Revenue Coverage 

for wheat. 

“The two biggest improvements are the ease of starting up 

and getting into the nursery insurance program, and the fact 

it adds. . . about 40 percent of the plant material grown in 

Oregon that was previously uninsurable. That is probably 

the biggest thing.” —Tom Fessler of Woodburn Nursery 

and Azaleas Incorporated and past president of the Oregon 

Association of Nurserymen 

“Crop insurance has been our salvation. . . . If it had not 

been for crop insurance after the devastating losses in 1994 

Response to Farm Crisis 

RMA responded decisively to the distress of farmers 

affected by declining prices and the catastrophic 

effects of several years of disastrous weather, 

including those resulting from El Niño. In the South 

and West, deviations were approved in the standard 

loss adjustment procedure for cotton farmers suffering 

from drought. In the Northwest and Northern Plains, 

the following changes were approved for the 1999 

crop year: (1) new options to existing programs were 

added to counteract the effects of multiple years of 

losses, (2) Income Protection for barley was expanded 

to several States, (3) crambe and mustard crop 

insurance programs were developed for 18 North 

Dakota counties, and (4) current programs were 

expanded, including canola for North Dakota and 

Revenue Assurance for corn and soybeans in Illinois, 

Minnesota, and South Dakota. Recommendations were 

solicited for the development of a pilot program to 

better protect growers from losses due to wheat scab. 

In addition to these mostly long-term measures, RMA 

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and 1996, we would not have been able to 

continue.”—Georgia producer Duke Lane, Jr., owner of the 

second largest peach operation in the United States

Without crop insurance protection to help survive the 

effects of El Niño, third-generation peach farmer Lewis 

Holmes says, “I would have had to fold my tent. . . . I am 

willing to work with the local office in Valdosta, Georgia, 

and Washington officials to help forge a better risk 

management program to benefit all farmers. We need to 

protect American farmers so that they can provide our great 

country with the food and fiber that our people so richly 

deserve.” —Lewis F. Holmes, III, member of the Board of 

Directors of the South Carolina Peach Council

“The Cherry Pilot Crop Insurance program is providing a 

risk management tool to cherry growers that has never been 

available before . . . . The pilot could not have been 

approved at a better time.” —Nora Baldwin, owner of 

Homestead Orchards in Washington State 

will pay hard-hit producers an estimated $1.7+ billion 

in claims for 1998 losses, including over $556 million 

in Texas, $96.6 million in North Dakota, $114.7 

million in Georgia, $95.1 million in California, and 

$78.9 million in Minnesota. 

Agricultural Research Bill

On June 3, President Clinton signed the Agricultural 

Research, Extension, and Education Reform Act of 

1998, Public Law 105-185, sending a message to 

producers that the Administration was committed to 

stabilizing and strengthening the crop insurance 

program. The Act ensured the stability of the program 

by meeting budget targets and providing permanent 

funding from (1) offsets from the food stamp 

administration surplus, (2) decreased compensation to 

insurance companies, and (3) increased producer fees. 

Risk Management Education

The Risk Management Education (RME) initiative 

was established by Secretary Glickman in 1997 to 

foster partnerships between the private and public 

sector that would lead to the creation of a comprehensive RME program. In 1998, Secretary Glickman 

awarded $3 million in grants to 17 of the 107 applicants who responded to the call for proposals. RMA, the 

lead government agency, also conducted more than a dozen State and regional conferences to “train the 

trainers.” 

Dairy Options Pilot Program

On June 8, 1998, Secretary Glickman launched the $11 million options pilot program for dairy producers, 

observing that “with this innovative program, CCC will build on its efforts to help farmers—both large and 

small—to manage risk.” The first RMA program to use futures markets as a risk management tool, the pilot 

project allows farmers to offset their losses when milk prices fall, based on projected future earnings. 

New Revenue Insurance Policies 

In September 1998, the Secretary announced the approval of the Adjusted Gross Revenue (AGR) pilot 

program, observing that “If this experiment succeeds, we will be closer to the day when we can cover all 

crops.” The AGR policy will insure a percentage of multiple commodities under one policy, and base coverage 

on an adjusted 5-year average of gross income reported by the farmer on Schedule F of his or her tax return. 

Expansion of Covered Crops

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For the 1998 crop year, RMA expanded 28 current crop programs into an additional 187 counties. This 

expansion added to the staggering national total of 28,154 county crop programs in 2,983 counties. In 1999, 

expansions will include canola, blueberries, income protection for barley, crop revenue coverage (CRC) for 

rice, and revenue assurance for corn and soybeans. CRC coverage will also be available for corn, cotton, grain 

sorghum, and soybeans in Florida and Maryland counties where the crop is already insured under a standard 

crop insurance policy. 

2. Providing Tools for Wise Stewardship of the Land

USDA’s Natural Resources and Environment mission area plays a vital role in the management and 

conservation of the Nation’s land, natural resources, and natural heritage. USDA’s Forest Service and the 

Natural Resources Conservation Service share responsibility for fostering sound stewardship on 75 percent of 

the country’s total land area. 

The Forest Service mission is to sustain the health, productivity, and diversity of the land to meet the needs of 

present and future generations. The Forest Service carries out its mission in several ways: through wise care 

and stewardship of national forests and grasslands; through cutting-edge research programs which promote 

conservation, recycling, and new technologies that support ecologically sustainable development; and through 

State and private forestry programs which help deliver the benefits of conservation to hundreds of 

communities and States across the Nation. 

The Forest Service manages 191.6 million acres of public lands, made up of 155 national forests and 20 

national grasslands in 44 States, Puerto Rico, and the Virgin Islands. The Forest Service challenge on the eve 

of the 21st century is to manage the people’s forests and grasslands through a new natural resource agenda 

with health of the land as the primary objective. 

Improvements to Conservation Reserve Program

On January 29, Secretary Glickman announced results of 

the 16th signup for CCC Conservation Reserve Program 

(CRP), bringing 5.9 million environmentally sensitive acres 

into the program, greatly increasing the conservation value 

of the program.

The Natural Resources Conservation Service (NRCS) 

mission, “to provide leadership and administer 

programs to help people conserve, improve, and 

sustain our natural resources and environment,” 

provides the foundation for the conservation 

leadership role it has earned. For 6 decades, NRCS has 

worked side by side with landowners, conservation districts, State and local governments, and urban and rural 

partners to restore and enhance the American landscape. The agency provides direct technical assistance and 

conducts a broad range of programs to address farmers’ and ranchers’ natural resource concerns on millions of 

acres of private lands. 

Although the programs of these agencies differ, both are defined by profound land and service ethics which 

guide their common mission: to promote diverse, healthy, and sustainable ecosystems by restoring and 

sustaining the integrity of soil, air, water, biological diversity, and ecological processes. By making resource 

management decisions in the context of the full system, the agencies ensure that products, values, services, and 

uses desired by people are produced in ways that sustain a healthy and productive Nation and environment. 

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Forest Service

Sustaining Our Natural Resource Legacy

As the Forest Service enters its second century, it is 

advancing a strong, broad-based natural resource 

agenda that sets clear priorities for its scientists and 

managers, holding them accountable to the 

American people for sustaining the health of the 

land. 

In support of the agenda, the Forest Service is 

focusing special attention on four areas: Watershed 

health and restoration; Sustainable forest 

management; National forest roads; and 

Recreation.

In autumn 1998, the Forest Service released 

Charting our Future: A Nation’s Natural Resource Legacy, a publication that presents a conservation vision for 

public lands in the 21st century. It is a call to action, both for Forest Service employees and for the many 

organizations and people who depend upon and care for the national forests and grasslands. 

Making a Difference on the Ground

In 1998 Forest Service Chief Mike Dombeck awarded more than 100 natural resource agenda grants worth 

more than $2 million to a wide array of projects that included community forestry, outreach to urban 

communities, interpretation and education, noxious weed eradication, watershed and road rehabilitation, 

wildlife and fisheries projects, forest management, research on assessing harvest methods, forest stress, 

watershed restoration, sustainability, and more. The grants were awarded to National Forests, Research, and 

State and Private Forestry programs. 

Community-Based Ecosystem Restoration Team–10 

Federal Agencies and State of Oregon Share Hammer 

Award

The Governor of Oregon and 10 Federal agencies signed a 

Memorandum of Understanding committing to a common 

vision and strategy focusing on the goal of healthy 

ecosystems rather than the means and processes to achieve 

it. This has empowered and encouraged local communitybased, watershed council efforts to develop and implement 

ecosystem plans that address all lands and issues in the 

watershed. The Federal agencies involved are Forest 

Service, Natural Resources Conservation Service, Fish and 

Wildlife Service, Bureau of Indian Affairs, Bureau of 

Working Together 

The Sustainability Roundtable made up of over 30 

leaders of Federal agencies and State, county, tribal, 

and nongovernmental organizations (including 

environmental, industry, landowner, and community 

groups and professional societies) was formed in 1998. 

The Roundtable was brought together by Secretary 

Dan Glickman and Forest Service Chief Mike 

Dombeck to help realize the President’s commitment 

to achieve sustainable forest management by the turn 

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Reclamation, National Park Service, National Marine 

Fisheries Service, Bureau of Land Management, 

Environmental Protection Agency, and the U.S. Army 

Corps of Engineers.

of the century. The overall goal of the Roundtable is to 

bring people together to foster common goals for 

sustainable forests and grasslands.

A Southwest Strategy for Natural Resource 

Conservation and Community Development

The Forest Service, along with other Federal agencies in Arizona and New Mexico, is working with local 

communities on a natural resource conservation and community development strategy. This is a collaborative 

effort to seek solutions to difficult issues such as adjustments to grazing permits, protection of endangered 

species, and protection and use of water resources. Awareness of the Southwest Strategy approach continues to 

spread as a potential model to resolve tough local and regional issues for public land management in the 

Southwest. 

Communities Reinvent Government To Protect and Use Public Lands 

In 1998, Under Secretary James Lyons presented representatives of the Diablo Trust with a National 

Reinvention Laboratory Certificate. Signed by Forest Service Chief Mike Dombeck and Vice President Al 

Gore, the certificate establishes the Diablo Trust as a National Reinvention Laboratory. Reinvention 

laboratories are innovative organizations or activities established to test or prototype new reinventing 

government initiatives. The Diablo Trust is the result of 5 years of effort by ranchers, environmentalists, the 

Hopi Tribe, Federal and State agencies, college faculty, and others in the Flagstaff, Arizona, area to keep the 

area’s hallmark large-scale landscapes intact. It is the first Reinvention Laboratory focused on ranching and 

landscape-scale opportunities. The Diablo Trust encompasses 500,000 acres including private lands and a 

portion of the Coconino National Forest (AZ). 

Team Oregon Conservation Partnership Wins Hammer 

Award

The Natural Resources Conservation Service in Oregon, 

with assistance from Oregon’s Association of Conservation 

Districts and the Oregon Department of Agriculture, 

reorganized the traditional line-and-staff structure into eight 

watershed basin groups. Because of the unique partnership 

and the streamlined way of conducting business, the 

Oregon Conservation Partnership has been able to use 

many existing and emerging conservation opportunities, 

including salmon restoration activities, water quality 

implementation, Farm Bill implementation and locally 

identified issues. This has saved taxpayers time, money, 

and frustration from bureaucratic duplication.

Recreationists Have New Resources

In 1998, the Forest Service joined with six other 

Federal agencies under the National Partnership for 

Reinventing Government to create 

www.recreation.gov, a new interagency Internet 

website and search engine that allows users to quickly 

and easily locate recreation opportunities on Federal 

lands. Also in 1998, the Forest Service expanded the 

opportunity for recreationists to reserve space at 

recreation sites nationwide through a toll-free number, 

providing a “one-stop” reservation service. 

Clean Water Act Turns 25 

The Federal Water Pollution Control Act, commonly known as the Clean Water Act, marked its 25-year 

anniversary in FY 1998. Nearly 80 percent of the Nation’s freshwater sources originate on national forest land. 

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In February 1998, President Clinton and Vice President Gore announced a new strategy for addressing water 

problems across the country in a Clean Water Action Plan. Developed under the leadership of USDA and the 

Environmental Protection Agency, the plan focuses on: greater Federal, State, and local integration through a 

watershed approach; connection between water quality and natural resource programs; accelerating watershed 

and ecosystem restoration; and critical role of collaboration with communities and other local stakeholders. 

Turning Street Trees Into Sawlogs 

Utilizing City Trees, an award-winning publication by the Forest Service and New Jersey Forestry Services, 

inspired workshops on the same theme in 1998. The publication and workshops educate and train personnel 

from tree service companies, lumber manufacturers, municipalities, and State agencies on how to merchandise 

sawmill-size logs from trees removed from city streets. The strategy turns urban wood waste, a potential cost 

burden, into an income-producing opportunity. Urban wood recycling efforts are a part of the Forest Service’s 

emphasis on urban and community forestry. 

Hammer Award to Columbia Gorge Discovery Center 

Usually the Forest Service plans, develops, constructs, 

operates, and maintains its interpretive centers. When it 

came time to plan the Columbia River Columbia Gorge 

Discovery Center in Oregon, the Forest Service entered 

into a unique partnership with the local government and 

citizens. A five-member group became the overall 

responsible governing body of this facility and worked to 

jointly construct the Discovery Center with the Wasco 

County Museum. This is a private/nonprofit/ Federal 

project owned and operated by the private/nonprofit group. 

The Forest Service serves as a member, not as the 

controlling organization. This resulted in significant cost 

savings to government in the construction phase and will 

result in reduced long-term operation costs. The Forest 

Service is providing service to the public which features the 

strengths of the private sector, the support of a community 

regional nonprofit entity, and the professional capabilities 

of the Forest Service.

Improving the Urban Environment in the Nation’s 

Capital

On February 3, 1998, Secretary Dan Glickman joined 

USDA’s Forest Service; Natural Resources 

Conservation Service; Agricultural Research Service; 

and Cooperative State Research, Education, and 

Extension Service; and District of Columbia 

Government officials to recognize community 

organizations that will share $250,000 of Federal 

Challenge Cost-Share funds. Twelve groups received 

funds ranging from $5,098 to $50,000 to use in 

implementing Urban Environmental Resource 

Initiative projects as part of USDA’s Plan of Action 

for the District of Columbia. The Urban 

Environmental Resource Initiative helps local groups 

improve their environment through volunteerism and 

community support. This project is part of the President’s Initiative to assist the District of Columbia in 

improving the health and beauty of its urban environment. 

Sustaining Forests Globally 

In 1998, Forest Service Chief Mike Dombeck reviewed collaborative programs in Negev, Jerusalem, and the 

northern Galilee region in Israel. The Forest Service and the Keren Kayemeth LeIsrael World, the land 

management counterpart in Israel, have been working together on arid and semi-arid afforestation (planting 

trees where they have not grown before) and watershed management for over 10 years, during which time over 

50 technical exchanges involving more than 100 professionals have occurred. The Forest Service is the 

principal sponsor of the International Arid Land Consortium that researches, develops, and performs 

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demonstration projects in arid lands management. 

Serving All People

In 1998, the Forest Service joined with the Bureau of Land 

Management, the National Park Service, the Bureau of 

Reclamation, the Army Corps of Engineers, and the Fish and 

Wildlife Service to improve our ability to serve all of our publics. 

We joined in an agreement with a nonprofit organization, 

Wilderness Inquiry, to further the goals of dignity, independence, 

and social integration in the outdoor recreation environment. 

Wilderness Inquiry, based in Minneapolis, Minnesota, has been 

providing recreation and wilderness opportunities for people from diverse backgrounds, including those with 

disabilities, urban at-risk populations, and single-parent families, for more than 20 years. Services include 

training, outreach, and development of information. Trips are also available for those who may not be able to 

experience natural settings on their own. 

Help for Flooded Areas

In June and July, USDA approved $18.9 million for 

Colorado, New York, Maine, California, South Dakota, 

Oklahoma, Ohio, Arizona, Alabama, New Hampshire, 

Vermont, Wisconsin, Mississippi, Minnesota, Indiana, 

Georgia, and West Virginia, to finance clearing debris from 

clogged waterways, restoring vegetation, and stabilizing 

flood-damaged river banks.

Forestry Is for Farmers Too

The Forest Service built a partnership in 1998 with the 

National Black Farmers Association and the USDA 

Coalition of Minority Employees. The agency is 

helping its new partners become better informed on 

landowner assistance programs available through State 

forestry organizations, and the partners are helping the 

Forest Service identify interested landowners with limited resources who have been underserved in the past. 

The Forest Service’s Southern Region plays an important role in reaching out to landowners in the South, 

where additional program services are especially needed. 

Natural Resources Conservation Service

Backyard Campaign Brings Conservation Close to Home

Thanks to the Backyard Conservation Campaign, people across the Nation are discovering that healthier 

natural resources can start very close to home. Unveiled by Secretary Glickman on Earth Day, April 22, 1998, 

the campaign continues to generate an avalanche of interest. So far, nearly 300,000 copies of the Backyard 

Conservation booklet have been distributed, and more than 30,000 requests for campaign information packet 

have been received. Local and national media interest continues to grow. Free air time is valued at more than 

$800,000 for the campaign’s television public service announcement, and more than $250,000 for the radio 

announcement. The campaign has brought a 600-percent increase in recruitment for the Natural Resources 

Conservation Service’s Earth Team Volunteer Program. The Backyard Conservation Campaign is a 

cooperative project of NRCS, the National Association of Conservation Districts, and the Wildlife Habitat 

Council.

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Backyard Conservation Campaign Video a Healthy 

Influence at Hospital

A video produced for the Backyard Conservation 

Campaign is bringing brighter days and bright ideas to 

patients and visitors at St. Vincent Hospital in Indianapolis, 

Indiana. The hospital’s media services staff broadcasts the 

9-minute tape 12 times every day over the hospital’s patient 

channel. The staff reports that patients and visitors are 

comforted by the video’s positive message and entertained 

by its colorful images. The hospital averages 700 patients at 

a time, with hundreds of visitors each day. That’s healthy 

exposure for backyard conservation.

Secretary Glickman Announces 25 New RC&D 

Areas

In March, Agriculture Secretary Dan Glickman 

announced that 25 areas in 18 States became eligible 

for USDA’s Resource Conservation and Development 

(RC&D) Program. The addition brings the total of 

RC&D areas to 315. RC&D, which is administered by 

NRCS, offers USDA technical and financial assistance 

for conservation and water management projects and 

expansion of economic, cultural, and recreational 

opportunities. Secretary Glickman also announced the expansion of six existing RC&D areas.

NRCS Helps Farmers in Guam “Go on the Record”

NRCS reports that some limited-resource farmers in Guam have difficulties receiving Environmental Quality 

Incentives Program (EQIP) benefits because recordkeeping is not part of their culture. To turn this situation 

around, NRCS entered into an EQIP educational assistance contract with the University of Guam, which 

includes workshops and one-on-one assistance on recordkeeping. This action has increased the effectiveness of 

EQIP.

NRCS Responds to Water Emergency in Pohnpei

The NRCS’ Pacific Basin office reports that a drought caused by El Niño forced the declaration of a water 

shortage emergency in the Federated States of Micronesia. Governor Del S. Pangelinon called for the 

protection of streams and underground water sources from animal and human wastes and nonbiodegradable 

products. In response to the declaration, NRCS conservationists translated water management information 

materials into local languages. NRCS also advised people on proper waste disposal and the need to boil 

drinking water to prevent hepatitis and other diseases.

Elkhorn Slough Watershed Project Team Wins 

Hammer Award

Elkhorn Slough Watershed Project Team in California 

worked cooperatively with local Hispanic growers to 

develop and apply innovative conservation technologies 

and delivery methods adapted to the growers’ cultural and 

economic differences. An average of 33 tons of soil per 

acre was lost from the fields each year, and as much as 145 

tons per acre were lost during wet years. The pesticides in 

this soil are likely responsible for the water quality 

problems in the Elkhorn Slough National Estuarine 

Reserve. A technical assistance team worked with the local 

Hispanic growers to find the common ground between their 

NRCS, Partners Assist Drought-Affected Farmers

In Central Texas, NRCS and the Texas Department of 

Agriculture held workshops with farmers and ranchers 

to provide them with information about how USDA 

can help them cope with drought conditions. 

Workshop topics included planting and managing 

winter pastures, selling cattle and buying hay, farm 

programs, and emergency loans. NRCS in the 

Dallas/Fort Worth area advised the public about how 

drought increases the possibilities and dangers of 

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needs and cultural issues and the natural resource 

objectives of the local Resource Conservation District and 

the Natural Resources Conservation Service.

wildfire. 

EQIP-Funded Effort Reducing Soil Erosion, 

Fertilizer Use

With funding from EQIP, the city of Syracuse, New York, is improving water quality in the Skaneateles Lake 

Watershed. Farmers are developing nutrient management plans that include conservation buffers and minimize 

nutrient use. Eighty percent of the farms—48 out of 60—are participating in the effort. These farms hold more 

than 90 percent of the agricultural land in the watershed. On 16 farms, the annual rate of erosion has been 

reduced by more than 2,000 tons. Fourteen farms have saved an average of $1,000 in fertilizer costs. On 11 

farms, livestock no longer have access to waterways.

NRCS, Partners Add Practices, Personnel To Protect Neuse River

NRCS and the North Carolina Division of Soil and Water Conservation accelerated the establishment of best 

management practices that address the pollution problems of the Neuse River, the waterway in which the 

bacteria Pfiesteria was discovered. NRCS added two positions and is sharing the cost of 10 district positions.

Wood Products End Use Team Wins Hammer Award

The last major end use survey of wood products conducted 

by the Forest Service alone took two Forest Service 

researchers and many student assistants more than 3 years 

to complete and cost well over $100,000. Today the Forest 

Service, the Engineered Wood Association, and the Wood 

Products Promotion Council work together to find out how 

people are using solid wood products. The surveys are 

directed and conducted by industry, with the Forest Service 

giving general advice on survey design and helping to 

analyze data. In the last 8 years, this unique collaboration 

has saved taxpayers more than $400,000.

NRCS Accelerates Outreach to Native Americans 

NRCS continues its commitment to increasing its 

services to Native Americans. The following are 

examples of this outreach:

 Colorado:NRCS assigned two tribal outreach 

specialists to work with the Ute Mountain Ute and 

Southern Ute tribes. NRCS has offices at each tribe’s 

headquarters and works directly with producers and 

the tribes’ agricultural and natural resources 

departments.

 Montana: NRCS held meetings to provide tribal representatives with overviews of USDA programs, the 

NRCS planning process, and the roles of tribal representatives on the State Technical Committee.

 South Dakota: NRCS gave the Standing Rock Tribal Conservation District an overview of assistance 

available from USDA. NRCS also developed a cultural resource agreement with the Tribal Historic 

Preservation Office to help members of the tribe plan conservation practices. 

 North Dakota: Eight listening forums sponsored by American Indian communities established a dialogue 

between USDA and the communities. 

 Arizona: Thanks to an unprecedented agreement with the Navajo Nation Historic Preservation Department, 

NRCS employees in Arizona are conducting archeological clearances prior to beginning conservation projects 

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on some of the most culturally significant and well-preserved archeological sites in the world. 

 Wyoming: NRCS and the State’s Food and Agriculture Committee met with the Shoshone-Arapaho Joint 

Business Council to discuss services of the USDA Service Center and Department programs available to the 

Wind River Indian Reservation.

 Minnesota: NRCS and the Fond du Lac Tribal and Community College in Cloquet established the Center of 

Excellence for Map Compilation. Students learn about soil science, soil surveys, aerial photo interpretation, 

remote-sensing fundamentals, and geographic information systems.

NRCS, Partners Restore Streambank Near Geriatric Center

In Upper Providence Township, NRCS in Pennsylvania and its State and local partners restored an 800-foot 

section of streambank along a tributary of the Schuykill River on property near a geriatric center. The NRCSdesigned project protects the streambank from erosion, which in turn prevents silt from eroding into the 

tributary. Working with NRCS were volunteer environmentalists, county inmates in an early release work 

program, county park personnel, county planners, and workers from State and local conservation agencies.

Conservation Measures, NRCS Efforts, Prevent Flood Damage

Storms in southwest Iowa severely eroded nearly 350,000 acres of cropland. Despite these losses, NRCS 

reports that fields protected by agency-recommended practices such as no-till farming, contour buffer strips, 

grassed waterways, field borders, and terraces suffered minimal sheet and rill erosion. In the town of Hamburg, 

a restored wetland prevented flooding. In Iowa County, wetland areas restored through NRCS’ Emergency 

Watershed Protection (EWP) Program prevented the flooding of 12,000 acres of cropland.

NRCS’ PLANTS Website Wins Awards From Media, 

Secretary Glickman

The NRCS’ PLANTS database on the World Wide Web 

received the Information Technology Award for Excellence 

from Government Computer News. The site also was 

named “Incredibly Useful Site of the Day” for July 7 by the 

MSNBC Network, which is owned by Microsoft and the 

National Broadcasting System. Secretary Glickman 

awarded the website the 52nd Annual Secretary’s 1998 

Group Achievement Award commending its commitment 

to “one-stop shopping” and reinvention of government, and 

to addressing environmental concerns and providing highquality natural resources information. PLANTS provides a 

single source of basic information about North American 

flora.

NRCS Funds Repair of Critical Access Road

Near Buffalo, Wyoming, an access road needed for 

emergency services and the livestock industry was 

repaired with nearly $240,000 in funds from EWP. 

State congressional delegates supported and assisted 

local people in finding funding for this project.

Hydrants Installed Through RC&D Program Cool 

Fire Insurance Costs

A study by NRCS of the RC&D Program in Louisiana 

found that fire protection measures installed through 

the program reduce rural homeowners’ fire insurance 

rates by approximately $137 per year. NRCS attributes the decrease to more than 2,000 dry fire hydrants 

installed through the program. 

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“SWAT” Team Protects Natural Resources

In Cobb County, Georgia, homeowners formed a “SWAT” team to prevent soil erosion and encourage the use 

of landscaping techniques that protect natural resources. “SWAT” is an acronym for “soil, water, air, and 

trees.” Team members must first join the NRCS Earth Team Volunteer Program to learn the basics of 

community conservation. NRCS Marietta Field Office provides the team with training and technical 

assistance. 

NRCS Office Excels, Earns Awards, Recognition From Secretary Glickman

For “performing its work with enthusiasm and competence far beyond most citizens’ expectations of a 

government agency,” the Baldwin County NRCS office in Bay Minette, Alabama, was named Government 

Agency of the Year by the county’s Environmental Advisory Board. The board praised NRCS Baldwin County 

for helping schools develop and build wetland study areas and an outdoor learning center. The office also 

worked with local conservation groups to develop a flood protection plan for a 200-square-mile watershed. 

Secretary Glickman cited NRCS Baldwin County for demonstrating the effectiveness of locally led 

conservation efforts and for its commitment to “going the extra mile to serve its customers.”

NRCS, Partners Team Up To Teach Businesses About Woodland Erosion

A woodland erosion control curriculum developed and implemented by NRCS in Louisiana with Boise 

Cascade and the Louisiana Forestry Association will have positive impacts on more than 3 million acres of 

industrial forest land and nearly 9 million acres of non-industrial forest land. NRCS reports that hundreds of 

contractors, loggers, foresters, and others have participated in education sessions based on the curriculum. 

Sponsors for these sessions include International Paper Company, Georgia Pacific, Weyerhauser, and 

Willamette Industries.

Virginians Off To See the “Wizard,” Thanks to NRCS, 

Partners

Visitors to the Virginia State Fair saw the first exhibition of 

the “Water Wizard,” a water quality education van. 

Donated by NRCS, the renovated cargo van contains 

watershed and groundwater models, videos, and interactive 

exhibits. The Chesapeake Bay Program, the State’s 

Department of Environmental Quality and Department of 

Conservation and Recreation, and Virginia’s Coastal 

Program fund the “Wizard.” To give the “Wizard” 

maximum exposure throughout the State, it is rotated 

among Virginia’s six 4-H Club centers.

Demand Growing for NRCS Plant Materials in 

Garden State

In New Jersey, demands for NRCS plant materials are 

exceeding supplies. To meet the demands, NRCS is 

reaching out to farmers to encourage them to grow 

conservation plants for commercial production. NRCS 

conservation plants and bioengineering assistance are 

protecting shorelines and preventing erosion along the 

Atlantic Ocean, bays and streambanks, and rivers and 

lakes.

New NRCS Information Series Shows “How-To’s” of Effective Customer Service 

The NRCS and its partners in conservation are working more effectively with people and communities, thanks 

to an information series produced by the agency’s Social Sciences Institute. The series features 11 publications 

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that help NRCS and its partners communicate to their customers the benefits of conservation and how to deal 

with situations that can occur while doing customer service. Copies of the publications were distributed to all 

NRCS State and field offices and are available on NRCS’ home page on the World Wide Web.

3. Feeding More Children and Families

Food and Nutrition Service

Mission 

The Food and Nutrition Service (FNS) reduces hunger and food insecurity in partnership with cooperating 

organizations by providing children and needy families access to food, a healthful diet, and nutrition education 

in a manner that supports American agriculture and inspires public confidence.

Millions of Americans Receive Nutrition Benefits Through FNS 

Programs

Sheer numbers attest to the impact of FNS programs on people: In 

FY 1998, about $17 billion in food benefits was provided to an 

average of nearly 20 million people each month through the Food 

Stamp Program (FSP); more than 5 billion (yes, billion) nutritious 

meals were served by the National School Lunch and School 

Breakfast Programs to more than 27 million children each day, over 

60 percent of them free or at reduced price; and more than $2 billion 

in nutritious supplemental food was provided to 7.4 million women, 

infants, and children every month through the Special Supplemental 

Nutrition Program for Women, Infants, and Children (WIC).

Passage of the WIC-Child Nutrition Reauthorization Legislation, 

Public Law 105-336

The passage of Public Law 105-336 represents the most significant 

expansion of child nutrition programs in decades, and the first 

reauthorization legislation proposed by the Executive Branch in more 

than 20 years. Signed by President Clinton on October 31, 1998, Public Law 105-336 expands children’s 

access to nutrition assistance and improves program operation, management, integrity, and safety. Public Law 

105-336 will allow youths aged 13 to 18 to receive nutritious snacks in after-school care programs, providing a 

strong incentive to draw low-income, at-risk youths into safe, constructive after-school activities. Expansion of 

availability of nutritious meals and snacks to older children is expected to draw 1 million children a day into 

after-school programs.

Outreach for Children’s Health Insurance

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By a simple check-off on their applications for free and reduced-price school meals, low-income parents will 

be able to receive information about health benefits through Medicaid or CHIP–the Children’s Health 

Insurance Program–created under the Balanced Budget Act of 1997. More than 15 million children in the 

United States qualify for free or reduced-price meals through the school programs. Many of those children are 

also eligible for one of the insurance programs. The insurance check-off is meant to reach parents of the 10 

million American children who currently are not covered, including 4.7 million who are eligible for Medicaid 

but are not enrolled.

USDA Helps Storm Victims

Following the April 18, 1998, tornado that hit Birmingham, 

Alabama, USDA approved a modified food stamp program 

for Jefferson County, Alabama, providing assistance to 

individuals whose homes were destroyed or damaged.

Gleaning Remains a Priority

FNS in July provided grants to 13 school districts 

around the country to help them find ways to increase 

their food donations to needy people. FNS also 

worked with the National Restaurant Association to publish a food recovery guide for restaurants, and 

coordinated efforts of other Federal agencies to facilitate food donations. All of these efforts contribute to 

USDA’s goal of increasing food recovery by 33 percent.

Implementing Welfare Reform

FNS has been active on a number of fronts to help States implement the 1996 welfare reform law, and 

subsequent legislation that modified the 1996 law:

Some 225,000 immigrants who lost 

food stamp benefits under the welfare 

reform law had those benefits restored 

as of November 1 because of FNS’s 

work with the Administration on the 

agricultural research bill, which 

passed in May 1998. FNS also 

developed guidance for States on 

implementation and bilingual 

informational material for 

immigrants. 

Prior to passage of the benefits 

restoration, FNS provided technical 

support for 13 States to establish Statefunded food stamp programs to 

provide benefits to more than 170,000 

of the most vulnerable of those who lost their Federal benefits. 

Improving Management of the Food Stamp Program

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September 1998 marked a major milestone in the development of Electronic Benefit Transfer (EBT) 

nationwide: more than 50 percent of all food stamp benefits issued are now issued through EBT systems. 

Today, 36 States and the District of Columbia are operating EBT systems, up from 25 a year ago. Twenty-nine 

of these States are now using EBT statewide, while only 16 were statewide at this time last year.

Food Recovery in Illinois

USDA officials in Illinois and the Illinois Council of 

Churches co-hosted a gleaning and food recovery 

workshop June 26 in Springfield, Illinois, to help interested 

groups learn needed skills and share information. Topics 

included “How to start a gleaning or food recovery 

project,” “What works–what doesn’t,” and “Getting the 

community involved.” It also included sessions on farmers 

markets, transportation issues, and interstate partnership 

possibilities.

Continuing its commitment to fighting fraud, FNS 

implemented tough new integrity provisions for food 

stamp retailers, including pre-authorization screening, 

tougher post-authorization controls, and stiffer 

penalties for violators. During FY 1998, the Food 

Stamp Program investigated 5,178 retailers, and fined 

or disqualified 1,201 for program violations. Of those, 

719 retailers, with redemptions of $49.5 million, were 

identified as having engaged in trafficking (the 

exchange of food stamps for cash). 

Continuing its series of “compliance sweeps,” the Food Stamp Program Compliance Branch in April 1998 

mounted a 3-week intensive nationwide effort, dubbed “Operation Spring Clean,” that focused on seven areas 

of the country. In all, 717 food stamp retailers were investigated in the seven sweep areas; 115 were caught 

trafficking and were immediately removed from the program pending further investigation. Immediate 

removal from the program in trafficking cases was among the new authorities granted to FNS under the 

welfare reform law. A total of 290 retailers were caught in program violations of all kinds. 

WIC Farmers’ Market Nutrition Program Gets Funding Increase 

Funding for the Farmers’ Market Nutrition Program was increased to $12 million in 1998, an increase of $5.25 

million from last year, allowing the program to expand in current States and into five more State WIC 

agencies, bringing the total to 32 States, the District of Columbia, and two Indian tribal organizations. More 

than 1 million WIC participants currently receive farmers’ market benefits to purchase fresh foods from over 

8,200 farmers nationwide.

Breastfeeding Promotion

More than 50 WIC State agencies are now participating in USDA’s national breastfeeding promotion effort, 

the “Loving Support Makes Breastfeeding Work” campaign kicked off by Secretary Glickman in 1997. 

Promotional materials geared to various ethnic groups, TV and radio spots in English and Spanish, and banners 

and other promotional items are available for purchase by WIC State agencies, the medical and health 

community, and the public to educate not only mothers but the entire community about breastfeeding. 

Improving Child Nutrition

In the autumn of 1998, FNS introduced “yourSELF,” a nutrition education kit aimed at middle school-age 

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Hammer Award Goes to South Carolina Combined 

Application Project (SCCAP) 

Working together, employees in the Social Security 

Administration (SSA) and FNS in South Carolina improved 

the way they deliver food assistance to elderly and disabled 

individuals. Eligible applicants may apply for food stamps 

jointly with supplemental security income (SSI) at the 

Social Security office. SSA determines FSP eligibility at 

the same time it determines eligibility for SSI. In the past, 

SSA employees completed a paper food stamp application 

(usually 8 to 11 pages) and sent it to the food stamp office 

for the State to process. But they no longer use a long paper 

form. This team developed a one-stop computer-based, 

online program, which eliminates two interviews and the 

need to visit several offices.

So far, SCCAP has brought in approximately 840 new 

SSI/FSP recipients each year of the demonstration, and 

outreach efforts have brought in over 8,500 new FSP cases. 

The project has also allowed the States to reallocate the 

equivalent of 40 full-time caseworkers—a savings of over 

$700,000. 

children. This represents a major expansion of the 

nutrition education initiative, which has been focused 

heretofore on elementary-age children. Introduction of 

“yourSELF” will increase the number of healthyeating messages children receive.

FDPIR Food Package Improvements

People participating in USDA’s Food Distribution 

Program on Indian Reservations (FDPIR) began 

receiving a better, more healthful food package in 

1998. Working with Native American tribal leaders, 

FNS developed a food package with more variety and 

choices without increasing the cost. Changes include 

more “user-friendly” products, such as frozen, cut-up 

chicken and sliced cheese rather than blocks. More 

low-fat and high-fiber products are included, such as 

bran cereal and low-fat refried beans. Other new 

products include egg noodles, quick oats, and more 

fruits and vegetables.

Memorandum of Understanding With HUD for CoLocation of Programs

People in federally supported housing developments will have better access to USDA’s nutrition, education, 

and child care programs because of a pilot program announced in May by Agriculture Secretary Dan Glickman 

and Housing and Urban Development (HUD) Secretary Andrew Cuomo. At pilot program sites in eight cities, 

USDA nutrition programs such as food stamps, WIC, child care, summer food service, and education 

programs offered through USDA’s Cooperative State Research, Education, and Extension Service will be 

available to residents through offices located in their housing complex.

Center for Nutrition Policy and Promotion

Mission

The mission of the Center for Nutrition Policy and Promotion (CNPP) is to improve the nutritional status of 

Americans by serving as the focal point within USDA for linking scientific research to the consumer. CNPP 

provides direction and coordination for USDA’s nutrition education and policy activities. The center helps 

enhance the nutritional status of Americans by serving as the focal point for the Department in translating 

nutrition research into information materials to increase public understanding of the importance of good 

nutrition and a healthful diet.

Dietary Guidelines for the 21st Century

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CNPP launched the Year 2000 update of the Dietary Guidelines for Americans with the first public meeting of 

the Dietary Guidelines Advisory Committee in September 1998. Every 5 years, the advisory committee, 

composed of experts in the fields of nutrition and health, meets to review the current dietary guidelines. During 

the review, the latest scientific evidence is considered in determining whether to recommend to the Secretaries 

of Agriculture and Health and Human Services that the guidelines be modified.

The Cost of Raising a Child in America

This CNPP report, published annually, outlines the cost of raising a child to age 18. As in years past, this 

year’s report received a great deal of attention in the news media, including a March 1998 cover story in U.S. 

News and World Report. Issuing the report from CNPP helps to solidify CNPP’s standing as the government’s 

best source of information on nutrition, health, and family economics.

The Healthy Eating Index: A Report Card on the American Diet

In July, CNPP issued its “report card on the American diet,” the Healthy Eating Index (HEI). The 1998 index 

showed that Americans in general are eating better—nutritionally speaking—than in past years, with the 

average HEI score rising about 2 points to 64 (still in the “needs improvement” range). USDA is using the 

demographic results of the HEI survey to target nutritionally at-risk populations with nutrition education 

programs through the FNS’ food assistance programs. CNPP will continue to analyze the results of food intake 

studies conducted by USDA’s Agricultural Research Service, publicizing the results and raising awareness 

among the general public of the importance of a healthy diet.

4. Raising Consumers' Confidence in Food Safety

Food Safety and Inspection Service

Mission

The Food Safety and Inspection Service (FSIS), a public health agency in USDA, protects consumers by 

ensuring that the Nation’s commercial supply of meat, poultry, and egg products is safe, wholesome, and 

accurately labeled, as required by the Federal Meat Inspection Act (FMIA), the Poultry Products Inspection 

Act (PPIA), and the Egg Products Inspection Act (EPIA).

FSIS inspects livestock and poultry before and after slaughter, and also regulates all raw beef, pork, lamb, 

chicken, and turkey, as well as processed meat and poultry and egg products prepared for distribution in 

interstate and foreign commerce, including imported products. More than 7,500 Federal inspectors carry out 

inspection laws in over 6,000 plants. 

Foodborne illness is recognized as a significant public health problem in the United States. FSIS develops new 

methods of inspection to better protect the public health. It tracks new and emerging public health problems 

related to food safety. And it responds to microbiological, residue, and other contamination incidents and, 

when appropriate, seeks voluntary recall of products by firms. 

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FSIS continues to carry out a broad and long-term, science-based strategy to improve the safety of meat, 

poultry, and egg products and to better protect public health. The agency is undertaking a farm-to-table 

approach by taking steps to improve the safety of meat and poultry at each step in the food production, 

processing, distribution, and marketing chain. These steps are designed to focus more attention on the risk of 

microbial contamination, the Nation’s most significant food safety problem. 

Accomplishment Highlights, FY 1998

HACCP Implementation Successful 

On January 26, 1998, more than 300 large meat and poultry plants (those with 500 or more employees) were 

required to have Hazard Analysis and Critical Control Points (HACCP) systems in place. Large plants account 

for approximately 75 percent of slaughter production.

USDA Works With Small Plants To Facilitate HACCP 

Implementation

On May 7, USDA food safety officials met with owners 

and managers of small plants preparing for the HACCP 

implementation date of January 25, 1999, to discuss 

additional ways of ensuring that small plants receive the 

assistance they need to make the transition to HACCP.

FSIS Initiated an Aggressive Outreach Program To 

Assist Small Plants With HACCP Implementation 

FSIS efforts to assist small plants (defined as having 

10 or more employees, but fewer than 500) include 

three initiatives. The first is working with a HACCP 

coordinator in each State to bring together resources 

for that State. Second, FSIS is encouraging land-grant 

universities that conduct livestock or poultry slaughter or processing operations to develop HACCP systems 

for their operations and to serve as sources of information for small plants. And third, industry and trade 

association personnel, extension agents, and other appropriate people are strongly encouraged to act as 

“sponsors” to small plants by offering technical information on HACCP systems.

Nationwide Series of 20 Public Meetings To Help Small Plants 

FSIS held the first 2 of a series of 20 public meetings across the country on HACCP implementation for small 

plants. The purpose of these meetings is to discuss ways to help owners and managers of small plants prepare 

for the January 25, 1999, HACCP implementation date. 

Technical Service Center Operates HACCP Hotline 

Since its beginning on January 20, 1998, the HACCP Hotline has handled over 10,000 inquiries, contributing 

to the successful implementation of HACCP during this critical time. 

Risk Assessments 

FSIS initiated the first farm-to-table quantitative risk assessment for Salmonella enteritidis in eggs and egg 

products. Results were presented at a June 12, 1998, risk forum sponsored by USDA’s Office of Risk 

Assessment and Cost-Benefit Analysis. A risk assessment is also underway for E. coli O157:H7 in meat. 

FSIS Issues Rule on Requirement for Shell Eggs 

At the direction of Congress, FSIS published a final rule on new regulations implementing requirements for 

refrigeration and labeling of shell eggs. The rule implements 1991 amendments to the Egg Products Inspection 

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Act.

Encouraging Results in First 6 Months of Testing for Salmonella in Large Meat and Poultry Plants 

FSIS released a progress report on the first 6 months of testing for Salmonella in large meat and poultry plants. 

Because the data is preliminary, FSIS is taking a conservative approach in interpreting and presenting the data; 

however, there is a general trend toward lower percentages of products that are positive for Salmonella. 

Risk Analysis on BSE To Be Done by Harvard School of Public Health 

USDA entered into a cooperative agreement with Harvard University’s School of Public Health to conduct a 

risk analysis to assess the potential pathways for bovine spongiform encephalopathy (BSE) to enter into U.S. 

cattle and the U.S. food supply, to evaluate existing regulations and policies, and to identify any additional 

measures that could be taken to protect human and animal health. 

Public Meeting on the Browning of Ground Beef

On May 27, USDA held a public meeting to discuss the 

food safety issues presented by premature browning of 

ground beef, during which USDA released results of a new 

study on the premature browning of cooked hamburger that 

concluded that color is not a good indicator that a 

hamburger has been cooked to 160 degrees F, USDA’s 

recommended safe level.

Meat and Poultry Hotline 

The hotline received 164,575 calls during FY 1998. 

Hotline specialists spoke with approximately 38,621 

of those callers during business hours, recording data 

that were used for trend analysis. In addition to basic 

food handling, storage, and preparation questions, the 

hotline addressed the latest issues: BSE; product 

recalls; E. coli O157:H7 testing; premature browning 

of ground beef; transportation and storage of shell eggs; HACCP implementation; campylobacter, Salmonella

and poultry; irradiation; and organic labeling.

One of the year’s highlights was the November 25 visit by Secretary of Agriculture Dan Glickman. Secretary 

Glickman personally answered several hotline calls. The event generated interest in the hotline among the 

reporters in attendance, and crews from both NBC and CNN returned subsequently for filming and interviews.

Science-Based Advice for Consumers Cooking Ground Beef 

Research by FSIS and ARS supported the hypothesis that the color of a cooked hamburger is not a reliable 

indicator that a safe internal temperature has been reached. FSIS was instrumental in devising the study 

protocol and presenting the findings and implications for consumer education through several public meetings. 

To convey the message to consumers that safety is signified by a reading of 160 degrees F. on a thermometer, 

FSIS, the Office of the Secretary, the Office of the Under Secretary for Food Safety, and the White House 

worked together to plan an event featuring Vice President Gore and Secretary Glickman—a July 2 barbecue 

held on the Jamie L. Whitten Federal building lawn.

Partnership for Food Safety Education Fight BAC!TM 

As a founding member of the private-public partnership, FSIS was in the forefront of the campaign to instill 

the four key messages of the Fight BAC!TM campaign in the mind of every American. FSIS managed several 

campaign initiatives during the year. These include placement of the Fight BAC!TM brochure at the Consumer 

Information Center (CIC) in Pueblo, Colorado; an estimated 50,000 copies have been distributed through CIC. 

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Safe Summer Grilling

On July 2, Secretary Glickman and Vice President Al Gore 

led a safe summer grilling food safety event on the grounds 

of USDA headquarters. The Secretary and FSIS food safety 

experts had a cookout that emphasized why clusters of 

serious illness can be associated with meat contaminated 

through poor food handling and grilling techniques. They 

emphasized the importance of avoiding undercooking, 

using a thermometer to test doneness, and the critical need 

to keep food and cooking tools clean and free of crosscontamination.

The agency also managed requests for the Fight 

BAC!TM costume, exhibit, and puppets at locations 

nationwide. A Food Safety Education Month 

poster—developed in cooperation with the American 

School Food Service Association and the Food and 

Drug Administration (FDA)—was distributed to 

53,000 elementary school cafeterias. Finally, FSIS 

reviewed proposals to produce an educational package 

for middle-school students; the firm has been selected 

and work has begun.

National Food Safety Information Network 

The President’s National Food Safety Initiative directed agencies to establish a national clearinghouse for food 

safety education. FSIS worked with FDA to develop a proposal for this “clearinghouse,” which is currently 

referred to as the National Food Safety Information Network. One of the Network’s components was put into 

place in FY 1998 when government food safety sites on the World Wide Web were linked to help web users 

more easily find government information on food safety. The URL is http://www.foodsafety.gov/

Food Safety Enforcement Enhancement Act of 1998 

This bill was developed by the Secretary and forwarded to Congress to amend the Federal Meat Inspection Act 

and the Poultry Products Inspection Act to provide for improved public health and food safety through 

enhanced enforcement.

President’s Executive Order Creates Food Safety Council 

An Executive Order signed by President Clinton on August 25, 1998, established the President’s Council on 

Food Safety. The primary functions of the Council will be to develop a comprehensive strategic Federal food 

safety plan; advise agencies of priority areas for investment in food safety, ensure that Federal agencies 

annually develop coordinated food safety budgets; and oversee the recently established Joint Institute for Food 

Safety Research, ensuring that it addresses the highest priority research needs. The Secretaries of the 

Departments of Agriculture and Health and Human Services and the Assistant to the President for Science and 

Technology/Director of the Office of Science and Technology will serve as Joint Chairs of the Council.

EdNet 

EdNet, the National Food Safety Educator’s Network, is an 

electronic network for food safety educators. It is intended 

as a one-way direct mail food safety education update from 

the FDA, USDA, and the Centers for Disease Control 

(CDC).

FSIS Makes Report to Congress Available 

FoodNet: An Active Surveillance System for Bacterial 

Foodborne Disease in the United States, April 1998, is 

a report generated by the collaborative project among 

FSIS, CDC, and FDA; it includes data on the 

incidence of foodborne illness for calendar year 1997. 

HACCP-Base Inspection Models Project 

FSIS is designing new models for inspection within plants that slaughter three specific classes of animals to 

define what the agency and the regulated industry should do when those plants are operating under HACCP. 

With inspectors in these slaughter plants no longer carrying out activities that should be the plant’s 

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responsibility, FSIS could better focus on public health concerns and further implement its farm-to-table 

strategy.

New Computer Network To Fight Foodborne Illness Launched 

On May 22, 1998, Vice President Gore announced a new national computer network called PulseNet that will 

be five times faster in identifying foodborne illness. PulseNet will enable public health laboratories throughout 

the country to use the Internet to provide alerts when outbreaks of foodborne disease occur. 

5. Creating Jobs and Revitalizing the Economy in Rural Areas 

Rural Development Mission

The mission of Rural Development is to enhance the ability of rural communities to develop, to grow, and to 

improve their quality of life by targeting financial and technical resources in areas of greatest need through 

activities of greatest potential.

Program Summaries

The following is a summary of the number of loans and grants made by each program in USDA’s Rural 

Development mission and of the economic benefits provided by each:

Hero of Ice Storm Named Maine Multi-Family Housing 

Site Manager of the Year

A former tenant of the RHS rural rental housing-financed 

apartment complex called Stonington Manor in Maine, Eric 

Hoard is now its manager. During the January 1998 ice 

storm, Mr. Hoard brought wood from his own home for a 

community room stove and used his own resources to 

arrange for a barbecue on a gas grill so residents in the allelectric complex would have heat and food while the 

housing was without power. In recognition for his efforts, 

Mr. Hoard has been named the USDA Maine Multi-Family 

Housing Site Manager of the Year for 1998. When asked 

what the best thing about his job is, Mr. Hoard says, 

“Working with the tenants.”

Single-Family Housing

Direct Rural Housing Loan Program (Section 502 

direct)

This program offers low-interest homeownership loans 

to rural America’s working people. Approximately 40 

percent of the people it serves earn less than 50 

percent of the median income of the rural area in 

which they live; the remainder earn between 50 and 80 

percent. In FY 98, the program obligated $999.8 

million to enable approximately 17,200 families to 

become homeowners. 

Mutual Self-Help Housing Program

This program makes mortgage costs affordable to people with very low and low incomes by allowing them to 

contribute “sweat equity,” which they earn by building their own homes. The program provides grants to 

nonprofit and municipal technical assistance providers, who supervise small groups of families in the 

construction of their own homes. The families typically finance their homes through USDA direct rural 

housing loans. In FY 1998, the Rural Housing Service (RHS) provided 117 grantees in 43 States with a total of 

$26 million in technical assistance grants. In turn, the grantees supervised 1,520 families in the construction of 

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their own homes. The families received $110.4 million in direct rural housing loans from USDA.

Guaranteed Rural Housing Loan Program (Section 502 guarantee)

This program provides guaranteed loans of up to 90 percent to low- and moderate-income rural Americans 

who otherwise would not be able to obtain credit. It also allows borrowers to obtain loans for 100 percent of 

the appraised value of a house, thereby removing the downpayment barrier that prevents many people from 

becoming homeowners. In FY 1998, the program obligated $2.8 billion to allow approximately 39,400 

families to purchase homes.

Rural Home Repair Loan and Grant Programs (Section 504)

These programs provide funds to help very low-income people undertake the vital improvements necessary to 

make their homes habitable. These include weatherizing the homes, removing electrical and fire hazards, 

repairing roofing, and installing or improving water and waste-water disposal systems. The grant program 

serves people ages 62 and up, while the loan program is open to all very low-income rural people. In FY 1998, 

the home repair loan and grant programs obligated $54.4 million to allow approximately 11,100 families to 

make vital improvements to make their homes safe and liveable.

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RHS Community Facilities Program Helps Rural New 

York Teen Chemical Dependency Treatment Center To 

Double Its Capacity 

The Rose Hill Foundation, Inc., in Massena, New York, is 

a unique, freestanding chemical dependency treatment 

center devoted to adolescents, ages 12-18. Not only does it 

provide treatment to help chemically dependent teens 

overcome their addictions, but it also offers postrehabilitation treatment counseling, which has been 

completed by 89 percent of its patients. The treatment 

center has been in existence for 10 years and has served 

900 adolescents. Approximately 50 percent of its patient 

base is homeless. 

In April 1998, the facility received an RHS Community 

Facilities direct loan of $700,000, an $855,000 grant from 

the Office of Temporary and Disability Assistance 

Homeless Housing Program, and a $50,000 grant from the 

New York State Community Facilities Enhancement Fund. 

Through these funds, Rose Hill will be able to double its 

bed capacity from 15 to 30. Four beds will be designated 

for adolescent parents, their children, and pregnant teens. In 

addition, Rose Hill will be able to double the number of 

people it serves each year, going from 100 customers to 

200. Rose Hill makes its unique and vital services available 

to the entire State of New York.

Economic benefits provided by Single-Family 

programs

Together, Single-Family housing programs provided 

83,183 full-time jobs in construction and constructionrelated industries, $1.3 billion in wages, and $700.9 

million in combined Federal, State, and local revenues 

and fees.

Total number of homes financed: 56,500 

Total number of homes rehabilitated: 11,100 

Total financing provided: $3.98 billion

Multi-Family Housing

Rural Rental Housing Direct Loan Program 

(Section 515)

This program makes low-interest loans to developers 

of affordable rural rental housing. In 1998, RHS 

obligated $93.7 million toward construction of 122 

new rental complexes providing approximately 2,400 

units. It also obligated $56.3 million toward the repair 

and rehabilitation of existing units in 228 rural rental 

facilities.

Farm Labor Housing Loan and Grant Program 

(Section 514/516) 

The only national source for farm labor housing construction funds, this program provides low-interest loans 

and grants to developers of affordable rural rental housing for farmworkers, who are among the most poorly 

housed people in the country. These developers may be public or nonprofit agencies or farmers. In 1998, the 

program obligated $27.1 million to build 419 new units and rehabilitate seven rental complexes.

RHS Teams Up with Partners To Help Kentucky 

Couple Move From Log Cabin to New Home 

In 1998, Rayburn and Sarah Watson contacted Kentucky 

Rural Development seeking funds to repair their log cabin, 

built in 1866 and occupied continuously since then by 

family members. Rural Development determined that the 

house was beyond repair: the foundation was severely 

deteriorated, the home lacked running water and bathroom 

facilities, and the home was heated by a wood-burning 

cook stove and a gas heater. Rural Development teamed up 

with the Federation of Appalachian Housing Enterprises 

(FAHE) and Peoples Self Help Housing, Inc., to provide a 

leveraged USDA Section 502 direct rural housing loan to 

build Mr. and Mrs. Watson a new home. The Watsons are 

so pleased that they no longer have to carry water for 

Rental Assistance Program (Section 521)

This program makes rents in USDA rural rental 

housing and farm labor housing affordable to the 

tenants. In FY 1998, RHS provided over $540 million 

in rental assistance to more than 39,000 tenants.

Rural Rental Housing Guaranteed Loan Program 

(Section 538)

This program guarantees loans for developers of 

affordable rental housing. In FY 1998, the Section 538 

program approved loan guarantees worth $39.7 

million to build 28 rural rental housing developments 

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cooking, washing dishes, and doing laundry; that they have 

a bathtub; that they have level floors and carpet; and that 

their house is warm and insulated. Mr. and Mrs. Watson 

appreciate the attention to detail and workmanship that they 

feel make their house such a beautiful home. Mrs. Watson 

states that “We also appreciate the forethought the builders 

displayed by always taking into consideration my height 

and physical shortcomings.” Mr. and Mrs. Watson 

expressed their appreciation for the hard work of staffs of 

Rural Development, FAHE, and Peoples Self Help 

Housing.

with a total of 1,110 apartments in 14 States.

Housing Preservation Grant Program (Section 533)

This program provides grants to nonprofit 

organizations, Indian tribes, and Government agencies 

to bring up to code deteriorating single- and multifamily housing for very low- and low-income families. 

In 1998, the program provided $11 million to 165 

organizations to rehabilitate 2,975 houses and 

apartments. 

Economic benefits provided by Multi-Family programs

Together, Multi-Family housing programs provided 4,147 full-time jobs in construction and constructionrelated industries, $136.8 million in wages, and $72.4 million in combined Federal, State, and local revenues 

and fees.

Total number of new apartments financed: 3,940 

Total number of apartment buildings renovated: 235 

Total number of single-family homes and/or apartments renovated: 2,975 

Total financing provided: $775.5 million

Business Loan Adds Jobs in Tennessee 

A $400,000 Rural Business-Cooperative Service loan to the 

Meriwether Lewis Electric Cooperative in Centerville, 

Tennessee, will be re-loaned, interest free, to the Stewart 

Houston Industrial Park Board in Houston County to 

construct a 40,000-square-foot industrial building to house 

Southern Gage, Inc., producer of a full line of gauge 

products for industrial manufacturing processes. Southern 

Gage currently employs 70 people and expects to add 124 

new jobs as the result of its $1.8 million planned expansion. 

Over the past several years, Houston County has 

consistently experienced unemployment ranging 2 to 3 

times higher than the national average. The new 

employment opportunities will have a dramatic effect on 

the economy of Houston County and neighboring Stewart 

County.

Community Facilities

Community Facilities Direct Loan Program

This program provides direct loans to rural 

communities for essential community facilities. These 

include child care centers, adult care centers, hospitals, 

clinics, schools, municipal buildings, and community 

centers, as well as emergency rescue equipment, 

among others. In 1998, the program obligated $210.9 

million to fund 423 projects.

Community Facilities Guaranteed Loan Program

This program provides loan guarantees of up to 90 

percent to rural communities to build essential 

community facilities. These include child care centers, adult care centers, hospitals, clinics, schools, municipal 

buildings, and community centers, as well as emergency rescue equipment, among others. In FY 98, the 

program obligated $65.5 million to fund 69 projects.

Community Facilities Grant Program

The grant program helps very low-income communities finance their facilities by reducing the amount of debt 

which must be incurred to acquire facilities. These facilities include child care centers, adult care centers, 

hospitals, clinics, schools, municipal buildings, and community centers, as well as emergency rescue 

equipment, among others. In 1998, the grant program obligated $9.5 million in grants to help fund 267 

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projects.

Economic benefits provided by Community Facilities programs—

Together, Community Facilities programs provided 9,911 full-time jobs in FY 1998. 

Total number of communities with new or improved essential community facilities: 422 

Total financing provided: $285.9 million

Rural Development Program Purchases Equipment To 

Establish Tribal Business

A Rural Business Enterprise Grant (RBEG) was approved 

for the Red Lake Band of Chippewa Indians (Tribe), Red 

Lake, Minnesota, in the amount of $180,000, which will be 

used to acquire manufacturing equipment. The grant is a 

portion of the funding needed to complete the project. The 

tribe will own and lease a building and equipment to a 

tribal-owned manufacturer of window blinds and shades, 

Anderson Fabrics, Inc. The unemployment rate on the 

reservation is one of the highest in the State. This project 

brings together a number of Federal, State, and local 

resources to finance a multi-purpose facility to assist with 

the transition of tribal members from unemployment into a 

fully trained and educated work force. It is projected that 

30 new jobs will be created.

Rural Business Programs Business and Industry 

Guaranteed Loan Program 

In a partnership with the Department of Treasury and 

the North American Development (NAD) Bank, the 

USDA Business and Industry Guaranteed Loan 

Program provided $73 million in loans that created or 

saved over 2,000 jobs in areas impacted by NAFTArelated trade. The total cost to the Government was 

under $500 per job.

Electric Program 

The Electric Program approved 74 loans for a total of 

$539 million to Rural Utilities Service (RUS) 

borrowers serving counties identified as persistent poverty counties. In addition, 72 loans for a total of $286 

million were approved for borrowers serving counties identified as having persistent outmigration. Based upon 

financial and statistical information provided by RUS borrowers, 2.7 million consumers benefited from electric 

system improvements that were made during FY 1998.

Telecommunications 

During FY 1998, the Telecommunications Program improved the information superhighway for rural America 

by making loans and loan guarantees of $565 million for 53 rural telecommunications projects that provided 

improved service to more than 1.2 million rural residents, including new service to 225,000 residents. 

Improvements will include installation of $94 million of new digital switching technology and nearly 7,000 

miles of fiber optic cable and associated electronic equipment costing $210 million. Some of these facilities 

will be used specifically to connect an additional 16 schools to distance learning systems. These and other 

system enhancements are making advanced telecommunications services available to more rural Americans 

than ever before. For every million dollars of loan funds spent by RUS/RTB (Rural Telephone Bank) 

borrowers, an additional $4.7 million in private investments was spent by these borrowers on 

telecommunications facilities.

RUS Supports Distance Learning and Telemedicine 

RUS provided $7.9 million in grants and $2.6 million in loans for 35 distance learning projects and $4.6 

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million in grants and nearly $1 million in loans for 25 telemedicine projects that will serve rural residents 

through educational centers and health care providers at approximately 300 separate sites. Eight of the awards 

will be used to assist people in Empowerment Zones and Enterprise Communities.

EC Funding Begins Flood Prevention Project in 

Missouri EC

In the past, residents in the East Prairie, Missouri, EC had 

to be evacuated when the river rose, flooding the 130,000-

acre St. Johns Basin. Flood control measures, authorized in 

1954, had continually been hampered by financial 

limitations. Now, thanks to funding from USDA and the 

Army Corps of Engineers, residents can rest easy.

EC designation “has been the enabling factor to get the 

project to move forward,” says Eddie Belk, project 

manager of the Memphis District Corps of Engineers. The 

program enabled USDA to provide all but 5 percent of the 

local community’s cost share for the first phase of this 

$42.5 million project. This funding provided momentum 

for other sponsors. 

Water and Environmental Programs 

During FY 1998, the Water and Environmental 

Programs provided more than $1.3 billion in loans and 

grants for over 1,200 rural water or wastewater 

projects that serve 9 million people, creating over 

55,000 jobs.

Water 2000 

About 1 million residents of rural America lack safe, 

clean drinking water in their homes. RUS has been 

spearheading the Water 2000 initiative to provide this 

basic resource that most Americans take for granted. 

RUS conducted State-by-State need assessments and 

determined that 25 million rural residents experience 

water-related health problems, are forced to haul water, or are under orders to boil water. In the first 3 years of 

this program, RUS invested more than $735 million in loans and grants to the Nation’s highest priority Water 

2000 projects. The average median household income for the service areas is only $18,662. Water 2000 funded 

87 projects in 1998 to improve the drinking water systems serving over 77,000 households, to improve service 

to over 250,000 people, and to provide first-time public water to over 39,000. 

Program Accomplishments

Community Facilities Program Finances More Child Care Centers Than Ever Before 

The Community Facilities program has made financing child care centers a high priority. In FY 1998, the 

program provided $13.1 million in loans, grants, and guarantees to fund 46 child care centers.

Community Facilities Program Provides More Funding Than Ever Before for Indian Facilities 

In FY 1998, the Community Facilities program provided 18 loans, grants, and guarantees worth $14.2 million 

going to fund 14 projects on 14 Indian reservations. Projects included three child day care centers, one adult 

day care center, two social services centers, two college buildings, one outpatient care facility, one physicianstaffed clinic, one city hall, one fire department, one community center, and one assisted-living facility.

Rural Utilities Service and the Federal Energy Regulatory Commission 

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Rural Residents Receive High-Tech Hardware and New 

Skills in Ohio EC 

Through the President’s Education Technology Program, 

USDA has made 72 computers (with an estimated value of 

$10,000) available to Greater Portsmouth, Ohio, EC 

schools. The EC is dedicating an additional $192,000 of its 

$2.95 million EZ/EC Social Service Block Grant funds for 

in-service computer training for teachers. More support for 

this program is expected—Greater Portsmouth has learned 

that it is eligible for funding under a State program that 

helps low-income communities obtain computers.

RUS has continued to be actively involved in 

proceedings at FERC on matters affecting 

restructuring of the electric utility industry and RUS 

borrowers. FERC regulates wholesale electric power 

markets and interstate transmission of electricity by 

public utilities. RUS electric borrowers are not 

generally subject to FERC regulation. However, 

FERC’s initiatives at opening up the Nation’s 

transmission systems to promote robust competition 

among electric generators are increasingly bringing 

RUS borrowers before the Commission.

Community Facilities Programs at an All-Time High Number of Borrowers Current on Their Loans 

Fully 100 percent of Community Facilities direct loan program borrowers and 99 percent of Community 

Facilities guaranteed loan program borrowers are current on their loans. The Community Facilities programs 

are doing an excellent job of both serving their rural customers and protecting taxpayers’ investments.

Electricity for the First Time 

RUS provided financing for facilities that The Socorro 

Electric Cooperative, Inc., headquartered in Socorro, New 

Mexico, constructed to electrify a very remote part of rural 

America. Socorro is building up to 20 miles of 14.4 kV line 

and secondary power extensions to serve consumers in 

Riley, New Mexico, who have never received central 

station electrical service. This unserved area is so remote 

that it requires a 50-mile drive from Socorro’s 

headquarters, of which 20 miles is on dirt roads. The people 

of this area are mostly Hispanics and Native Americans, 

and they have been living here all their lives without 

electricity or running water. Initially, 14 residents will 

receive electric service.

Multi-Family Housing Reaches Record-Low Loan 

Delinquency 

The Multi-Family Housing loan program reached a 

record-low delinquency rate of 1.9 percent as of 

September 30, 1998. This is an all-time low and is 

lower than almost all private-sector rates. This 

delinquency rate is based on a loan portfolio of 18,002 

projects and an outstanding loan principal of $11.9 

billion. The Multi-Family Housing program is doing 

an excellent job of both serving its rural customers and 

protecting taxpayers’ investments.

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RHS Develops Partnerships With the Nonprofit and Private Sectors To Provide Affordable Rural SingleFamily Housing 

RHS has been actively developing partnerships to leverage its limited single-family housing program dollars 

and increase affordable homeownership opportunities for rural America’s working people. In FY 1998, RHS 

significantly expanded its Rural Home Loan Partnership with the Federal Home Loan Bank System and the 

Rural Local Initiatives Support Corporation. RHS’s partners leveraged RHS’s contribution of $12.9 million 

with $6.9 million of their own funds.

RHS also initiated a partnership with various Community Development Financial Institutions (CDFIs) and 

their private-sector partners throughout the country. The purpose of the partnership is to provide 

homeownership opportunities to very low- and low-income applicants by combining the resources of RHS, the 

CDFIs, and their private-sector partners. Through 15 local partnerships, 55 rural families have received home 

loans at rates significantly more affordable than those in the private sector. RHS provided $2.9 million, which 

the CDFIs and their private-sector partners leveraged with $992,000 of their own funds.

Revolving Fund Launches Entrepreneurial Ventures in Pennsylvania Enterprise Community

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New Water System in New York 

Water and Environmental Programs provided a loan of 

$822,400 and a grant of $677,600 to install 20,420 linear 

feet of 8-inch water main, 35 fire hydrants, and 2 pressurereducing valves in the Park Terrace Water District in the 

Town of Birmingham, New York. Water will be supplied 

from the City of Birmingham. This project will serve 155 

users. The township has endured extreme hardship from 

depleted ground water resources. Public health concerns 

engendered by this situation include lack of adequate water 

for drinking and food preparation, lack of adequate water 

for personal hygiene and household cleaning, and 

inefficiency of the sanitary sewer system. 

Many residents were collecting rainwater, snow, and roof 

runoff for domestic use. Many properties had been 

abandoned since they have been inhabitable due to a lack of 

domestic water. Other residents hauled water to maintain 

their homes. Without RUS assistance, these homeowners 

would have been without water for a year or many years. 

Small, startup businesses are often unable to borrow 

startup money because banks and other lending 

institutions favor businesses with established track 

records. To help creditworthy startup businesses, the 

City of Lock Haven, Pennsylvania, allocated $200,000 

in Enterprise Community (EC) funds to create the 

Commercial Revolving Loan Fund. Owners of retail, 

service, or commercial businesses in Lock Haven are 

eligible for low-interest loans of up to $25,000 to 

improve their facilities, expand an existing business, 

or start a new business.

The City of Lock Haven received a $500,000 USDA 

Rural Business Enterprise Grant to expand the loan 

fund; the city also developed a grant program in 

conjunction with the fund. Small businesses that are 

planning renovations or construction can apply for 

grants of up to $5,000. 

Kentucky Highlands EZ Attracts 13 New 

Businesses 

Since receiving its designation as an Empowerment Zone (EZ) 3 years ago, the Kentucky Highlands EZ has 

assisted 13 businesses that have either located or made commitments to locate within the EZ area. The EZ has 

invested more than $4.1 million in local businesses, which now employ more than 160 residents of Clinton, 

Jackson, and Wayne Counties.

RUS Influences Telecommunications Worldwide 

The influence of the RUS Telecommunications Program 

reaches around the world. The government of South Africa 

asked the National Telephone Cooperative Association 

(NTCA) to help find a way to get telecommunications 

services into the unserved and underserved areas of the 

country. NTCA is using RUS statistical reports from 1961 

to1996 to profile the progress that rural cooperatives have 

made in the United States. Through analysis of this 

statistical information, NTCA expects to show how 

cooperatives start with little capital, grow stronger with 

time, and eventually can sponsor rural economic 

development projects of their own. The NTCA 

representative said that the RUS statistical information is 

the best in the industry, and that without it this task would 

be very difficult.

Debt Refinancing Provides Savings 

Electric program staff, working with five RUS rural 

electric cooperative power supply borrowers, produced 

annual savings of more that $30 million for rural 

consumers in four States by refinancing high-interest 

utility debt. These refinancing savings can be passed 

on to the power supply borrowers’ member 

distribution cooperatives and to their members—rural 

Americans. The North Carolina Electric Membership 

Corporation of Raleigh, North Carolina; Georgia 

Transmission Corporation of Tucker, Georgia; East 

River Electric Power Cooperative in Madison, South 

Dakota; and Sho-Me Power Cooperative in 

Marshfield, Missouri, refinanced $1,199,065,066 in 

Federal Financing Bank loans, guaranteed by RUS, to provide the savings.

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Development of the Administration’s Comprehensive Electric Competition Plan 

USDA and RUS actively participated in the development of the President’s Electric Competition Plan and 

proposed legislation. USDA participation on the White House Interagency Working Group on Restructuring 

increased awareness of the many challenges facing rural areas in maintaining access to affordable electric 

power. 

As a result of interagency discussions, the President’s Plan and legislation sent to Congress in June 1998 

contain a number of provisions to protect rural electric systems and their customers. The legislation requires 

the Federal Energy Regulatory Commission (FERC) to recognize the special nature of rural electric systems 

and to assure that RUS borrowers will, to the maximum extent practicable, be able to meet their loan 

obligations. The Plan also provides for a rural safety net to offset adverse economic consequences for rural 

systems to be administered through a public benefits fund. 

Village of Kongiganak, Alaska 

Kongiganak, a USDA Rural Development-designated 

Champion Community, received a $300,000 Rural Alaska 

Village Grant to match a $500,000 grant from the State of 

Alaska. These funds will upgrade wastewater treatment 

facilities and the community’s washeteria, which is the 

only source of drinking water for the community’s 349 

native Alaskans. Currently, some residents use rain 

catchments during the summer and ice melt in the winter 

for their fresh water supply. Wastewater is removed by 

using honey buckets that are hauled by the village to a 

pretreatment plant at the sewage lagoon. The project will 

also locate and develop a potable water supply for this 

remote, rural Alaskan village.

Community Facilities-Financed Hospital Named 

Best Hospital in the Nation With Fewer Than 350 

Beds 

Recently, Solution Point, a hospital survey company, 

named North Hawaii Community Hospital the best 

hospital in the Nation with fewer than 350 beds. The 

50-bed hospital won a Best in Class Consumer 

Satisfaction Award for total processes. The hospital 

also won top awards among small hospitals for 

housekeeping and food services. The hospital 

combines modern medicine with health care not 

normally found in a hospital, such as psychology, 

naturopathy, chiropractic, massage therapy, and acupuncture. North Hawaii Community Hospital was funded 

through a $15 million Community Facilities guaranteed loan made by Bank of America. The State of Hawaii 

provided grant funds and the local community raised $6 million in contributions.

6. Investing in the Future Through Research, 

Education, and Economics

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Agricultural Research Service

Mission

As USDA’s main in-house research arm and one of the four agencies that 

make up the Research, Education, and Economics mission area, the 

Agricultural Research Service (ARS) conducts research to develop and 

transfer solutions to agricultural problems of high national priority and 

provides information access and dissemination to:

● Ensure high-quality, safe food, and other agricultural products, 

● Assess the nutritional needs of Americans, 

● Sustain a competitive agricultural economy, 

● Enhance the natural resource base and the environment, and 

● Provide economic opportunities for rural citizens, communities, and 

society as a whole. 

Selected accomplishments for FY 1998

● A new product created by ARS researchers significantly reduces 

potential Salmonella contamination in chickens. In U.S. field tests 

involving 80,000 chickens, the product—called 

PREEMPT—reduced Salmonella from about 7 percent in untreated chickens to zero percent in treated 

chickens. PREEMPT is a blend of 29 live, non-harmful bacteria naturally present in healthy adult 

chickens. These bacteria are sprayed in a fine mist over newly hatched chicks and prevented Salmonella 

from gaining a foothold in the chicks’ intestines.

● The water quality threat from phosphorus in chicken and pig manure could be greatly reduced by a new 

type of feed corn that’s low in phytic acid. Phosphorus loss to manure is 25 to 40 percent less when 

animals eat the low-phytic acid corn discovered by an ARS scientist. Excess phosphorus pollutes many 

bodies of water such as the Chesapeake Bay. 

● An enzyme in horseradish could make it easier to produce life-saving anti-cancer drugs, preliminary 

research by ARS scientists suggests. The scientists devised a method that uses the enzyme horseradish 

peroxidase in making cancer drugs known as chlorins. The new one-step method could save time and 

money. 

● Tender, affordable meats with less fat could come from hydrodyne, technology that uses shock waves 

to improve the texture of everything from lamb chops to steaks. Hydrodyne was developed in part by 

ARS scientists. With hydrodyne, underwater shock waves from a high-energy explosive charge 

tenderize meat with pressures as high as 25,000 pounds per square inch. Hydrodyne technology can 

provide a 50- to 70-percent improvement in tenderness of less tender meat. Hydrodyne also provides an 

alternative to fat as a source of tenderness. 

● ARS scientists showed that putting a little extra color in the tomato patch can reduce the need for 

pesticides and boost yields, too. In field studies in South Carolina, tomato plants grown with red plastic 

mulch in nematode-infested soil produced 17 pounds of fruit, more than double the yield of tomatoes 

grown with traditional black plastic mulch on infested soil. This was the first study documenting that 

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Farm*A*Syst Home*A*Syst Wins Hammer Award

This national program, centered at the University of 

Wisconsin, is an example of how Federal and State 

government agencies and the Extension services of the 

State land-grant college system can creatively work 

together to benefit rural America and the environment. 

Most people know that water pollution can come from 

crop land, rangeland, and livestock areas. But water 

pollution can also be generated around the farmstead 

where farm buildings are located, where petroleum and 

chemicals are stored and handled, and where animals 

are maintained and farm equipment serviced. 

Landowners are usually not aware of these problems, 

cost-effective abatement actions, or government 

assistance programs. This program, jointly funded by 

USDA’s CSREES and NRCS and EPA, has addressed 

this need with a unique approach. A small interagency 

team refined prototype education/assessment materials 

for several States. Alternative delivery approaches 

were piloted and lessons learned were shared with 

other State teams. Farm*A*Syst assessment and 

educational packages organize technical and 

management information obtained from a variety of 

disciplines and government agencies into one 

simplified and highly usable system of up to 15 

educational models and worksheets. Using these, 

farmers develop action plans to reduce or eliminate 

pollution risks on their property.

red mulch suppresses damage from the rootdwelling nematodes. 

● A study of 247 women at the USDA Human 

Nutrition Research Center on Aging at Tufts, 

Boston, confirmed that long-term use of vitamin C 

supplements substantially reduces the risk of 

cataract—a clouding of the eye’s lens. There were 

77 percent fewer early-stage cataracts among the 

women who took the supplements daily for more 

than 10 years than among those who didn’t take the 

supplements. 

● From corn fiber, a low-value byproduct of corn wet 

milling, ARS scientists developed two valuable 

new products: “Amaizing oil,” a corn fiber oil that 

may lower cholesterol, and “Zeagen,” a white corn 

fiber gum. Feeding studies with hamsters indicated 

that “Amaizing oil” significantly lowered total 

serum cholesterol and LDL cholesterol, the kind 

that clogs the arteries. The corn fiber gum could be 

used in food as an emulsifier, a soluble dietary 

fiber, or a thickener, and also has potential 

industrial applications for use in adhesives and 

water-based paint thickeners. 

● ARS scientists have identified the instigator behind 

the age-related decline in T cell function—which 

coordinates the body’s response to an infectious 

agent. What’s more, they were able to reduce the effects of this instigator in cultured cells. The 

scientists showed that prostaglandin E2 (PGE2) might contribute to the decline of T cell function in 

seniors because too much of this inflammation-producing substance has been shown to suppress T cell 

activity. Adding the antioxidant vitamin E to the cell cultures reduced PGE2 levels and improved T cell 

function. This suggests that people might slow the dysfunction of the immune system as they age by 

increasing body levels of vitamin E and possibly other nutrients. 

● A new detector built by an ARS scientist and an Iowa State University chemist illuminates otherwiseunseen fecal contamination on meat and alerts meat packers to the contamination within seconds. Feces 

are the major source of bacterial contamination in livestock and poultry slaughterhouses. With the new 

device, which utilizes fluorescent spectroscopy, a contaminated carcass can be identified and then 

sanitized before the contamination spreads. 

● ARS scientists in the spring of 1998 kicked off a new national project to suppress the Formosan 

subterranean termite, starting in New Orleans. The termite is now established in more than a dozen 

States, costing $1 billion annually in repairs and control measures. An information site on the project 

can be found on the World Wide Web at www.ars.usda.gov/is/fullstop 

● New revved-up biodiesel fuels that start engines at cold temperatures down to 5 degrees F have been 

developed by ARS scientists. The research should help speed up the commercialization of biodiesel 

fuels—a boost for U.S. soybean growers and the environment. Cold has been a problem for biodiesel 

fuels because temperatures at or below freezing cause them to form solid, waxy crystals that block fuel 

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lines and filters. The ARS scientists devised a three-step winterization process of mixing in additives, 

chilling the fuel, and filtering out solids. The research can help put biodiesel fuels into city buses, 

government and industry fleet cars, and underground mining equipment. The Federal Energy Policy Act 

requires 75 percent of all new State and Federal vehicles to be fitted for alternative fuels by the year 

2001. 

Cooperative State Research, Education, and Extension Service

Mission

The mission of the Cooperative State Research, Education, and Extension Service (CSREES) is to achieve 

significant and equitable improvements in domestic and global economic, environmental, and social conditions 

by advancing creative and integrated research, education, and extension programs in food, agricultural, and 

related sciences in partnership with both the public and private sectors.

USDA Grants To Boost U.S. Agricultural Competitiveness

USDA awarded $3 million in Risk Management Education Program grants to help farmers and ranchers 

compete in local and global markets. Some of the 17 grants give special attention to the needs of limitedresource farmers. The grants are part of a coordinated USDA risk management education and insurance 

protection program required by the Federal Agricultural Improvement and Reform Act of 1996.

USDA Celebrates 50th Anniversary of International 

Four-H Youth Exchange

More than 600 participants from 26 countries on 6 

continents participated in the 7th World International FourH Youth Exchange Conference in Washington, DC. Deputy 

Secretary Richard Rominger congratulated the participants 

on 50 years of intercultural understanding at the 50th 

anniversary celebration at the National 4-H Center in 

Chevy Chase, Maryland. Participants attended workshops 

and interactive events, including an international bazaar, 

dinner at the U.S. Capitol, and an interfaith assembly.

Fund for Rural America Grants for Research, 

Education, and Extension

CSREES developed and carried out the $31.2 million 

competitive research, education, and extension grants 

component of the Fund for Rural America, awarding 

115 grants to organizations in 39 States. The grants 

support research, education, and extension projects 

that strengthen USDA agricul-tural, environmental, 

and rural development efforts and improve the quality 

of life for rural residents. In addition, the grants will help USDA improve delivery of services to underserved 

and poorly served farmers and other rural residents. 

USDA Grants $2.4 Million for Community Food Security 

CSREES awarded $2.4 million to 18 communities in 12 states to address local food, farm, and nutrition issues 

and help them become more self-sufficient in providing for their own food and nutrition needs. Many of the 

funded projects focus on helping communities meet the nutritional needs of low-income and elderly people. 

Some of the projects incorporate small business development, direct markets for local farms, and job training 

programs for youth.

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USDA Water Quality Education Grants Target Underserved Communities

CSREES awarded more than $678,000 in USDA water quality education grants to help underserved 

communities make informed decisions about their water resources. The 17 grants are designed to help the 

communities improve water management, handle storm water, manage wastes, and protect or improve the 

quality of their water supplies.

USDA Reaches Out to Communities on the Year 2000 “Bug”

The Year 2000 (Y2K) “bug” affects every part of society. The Nation’s food supply sector is at risk due to 

heavy dependence on computerized processing and information exchange. CSREES created a Y2K 

Community Outreach awareness campaign, putting valuable Y2K information into the hands of the public 

through the vast Cooperative Extension Service network of educators and specialists. The Y2K toolkit gave 

producers a clear understanding of the implications of the Y2K problem, solutions, and strategies for assessing 

their own situations, and suggestions for creating contingency plans should systems fail.

USDA Celebrates National Research Initiative 20th 

Anniversary 

The USDA and the National Academy of Sciences 

celebrated 20 years of competitive research grants in 

agriculture, recognizing USDA support for competitively 

funded research in fundamental and applied sciences 

important to agriculture. The introduction of a competitive 

research grants program at USDA in 1978 expanded the 

attention to fundamental sciences in agriculture and 

attracted high-quality scientists to study issues underlying 

agriculture. This CSREES program was expanded in 1991 

to form the National Research Initiative in response to a 

National Academy of Sciences report, Investing in 

Research: A Proposal to Strengthen the Agricultural, Food, 

and Environmental System, and has served as a model for 

other competitive grants programs within USDA.

Small Farm Digest: Valuable Resource

CSREES’ Small Farm Program works hard to improve 

the income and economic viability of small farms. One 

valuable resource for small farmers, introduced this 

year, is the Small Farm Digest, a quarterly newsletter 

distributed in print to more than 26,000 subscribers 

and also available via the World Wide Web. The 

newsletter highlights information from the national 

perspective, offers details of programs and resources 

available to small farmers, fosters discussion among 

small farmers, and presents success stories of small 

farmers to their peers.

Capacity Building Grants Awarded by USDA

Capacity building grants were awarded to support 42 teaching and research projects at historically black 1890 

land-grant institutions and Tuskegee University. The $9.2 million program is designed to strengthen 

partnerships, promote workforce diversity, and enhance the institutions’ teaching and research programs in the 

food and agricultural sciences. Teaching projects will focus on innovative student recruitment and retention 

activities, develop new and updated curricula, and acquire cutting-edge instructional delivery systems and 

scientific instrumentation for teaching. Research projects will address critical issues of State, regional, and 

national importance in such areas as food safety, human nutrition, environmental sciences, biotechnology, and 

plant and animal sciences.

Tribal Colleges Receive USDA Extension Awards 

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CSREES awarded nearly $2 million to 29 tribal colleges under USDA’s New Tribal Colleges Extension 

Program. The program supports training and education in a wide variety of areas, including production 

agriculture; business management; community and family development; 4-H and youth leadership; natural 

resources and conservation; and nutrition, diet, and health. 

Economic Research Service

Mission

The mission of the Economic Research Service is to provide economic analysis on efficiency, efficacy, and 

equity issues related to agriculture, food, natural resources, and rural development to improve public and 

private decisionmaking.

Accomplishments 

Following are some key accomplishments of the Economic Research Service for FY 1998:

Implications of Regional Trade Agreements and the World Trade Organization

An ERS report, Regional Trade Agreements and U.S. Agriculture (AER-771), analyzes RTA’s and concludes 

that U.S. agriculture can benefit from participating in them and may lose when it does not participate. 

Agriculture is an important source of potential U.S. gains from RTA’s.

Asian Financial Crisis

ERS conducted several analyses during 1998 of the implications for U.S. agriculture of the rapidly changing 

Asian economic and financial conditions. The potential scope and impact of the Asian financial crisis was first 

summarized in Agricultural Outlook (AGO-248). The initial assessment provided the analytic base for 

reassessing the Department’s short and intermediate outlook for U.S. agriculture and trade and allowed for 

more informed private and public decisions relative to the Asian crisis and its linkage to U.S. agriculture.

Effects of Prices and Income on Food Choices

Economic factors such as food prices and consumer income are important determinants of food choices, with 

potential consequences for nutrient availability. An ERS report, How Economic Factors Influence the Nutrient 

Content of Diets (TB-1864), provides estimates of how the availability of 28 nutrients would change as 

consumers alter their food purchases in response to changes in food prices and income through the 

interdependent food demand relationships. Estimates of nutrient income responses can also be a starting point 

in evaluating possible effects of income changes on dietary quality when food stamp benefits are cut or 

increased.

Sustainability in the Great Plains

ERS published a variety of research perspectives on economic sustainability in the Great Plains in a special 

issue of USDA’s Rural Development Perspectives focusing on issues related to building a sustainable 

economy in the rural Great Plains. The research effort emphasized the effects of 1996 farm legislation, the 

long-term decline of population, changing linkages between net migration and natural amenities and 

suburbanization, the needs of manufacturing firms, distress in the retail/wholesale sector, and the potential 

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effects of Federal programs in the region.

Highlighting the Performance of America’s Food System

ERS provides needed research and information to assess the ability and performance of the Nation’s food 

system to deliver safe and nutritious food at reasonable prices. The broad and inventive research program 

provided information to Federal policy officials on demographic, social, and economic determinants of diet 

quality; the costs of poor diets; and the benefits of improving diets and nutrition; thereby highlighting the 

importance of know-ledge and health education in shaping consumers’ diets. 

Enhanced Understanding of Farms and Rural America

ERS tracks and explains the changes being experienced on farms and in rural America. Such structural 

information about farms and rural communities is particularly important in showing the heterogeneity of farms 

and businesses that comprise the economic landscape of rural areas. As a result, the Secretary’s National 

Commission on Small Farms relied heavily and almost exclusively on ERS information for the factual basis 

that was used to augment, validate, or refute impressions and beliefs about the situation and problems of small 

and minority-operated farms out of which the Commission prepared recommendations. 

Information generated by ERS is particularly important for policymakers as they deal with small or 

disadvantaged farms, minority farmers, and the impacts of market and natural events. For example, ERS 

developed a new economic typology to characterize farms by linking primary occupation of the farm operators 

and their stage of career to value of production as a way to understand unique needs. In another example, ERS 

research on rural and agricultural credit markets has been used to assess the impact of proposed changes in 

USDA’s farm loan programs.

National Agricultural Statistics Service 

The mission of the National Agricultural Statistics Service (NASS) is to serve the 

basic agricultural and rural data needs of the people of the United States, including 

those working in agriculture and those living in rural communities, by objectively 

providing important, usable, and accurate statistical information and services for 

informed decisionmaking.

Web Stats for Kids 

A new feature was added to the NASS home page, NASS 

Kids. This educational site for young people uses a lighthearted approach to agriculture, statistics, and math. Users 

are escorted through the site by “Stanley Statistician” and 

“Pie-Chart Pam.” Among the NASS Kids features are a 

NASS IQ page, online coloring book, history trivia quiz, 

games, and links to other agricultural sites such as Ag in 

the Classroom. The page also offers answers to some 

commonly asked questions such as “What is a statistician?” 

and “What are charts and graphs?” The NASS Kids page 

was selected by Bonus.com, the SuperSite for Kids, as an 

“excellent site” and the site requested permission to link to 

1997 Census of Agriculture

In 1998, NASS conducted the census of agriculture for 

the first time. The transition of the census from the 

Bureau of the Census went very smoothly, even 

though the census of agriculture program was 

transferred to NASS midway through the planning 

cycle. Several noteworthy improvements were 

implemented which resulted in a higher response rate 

and release of the results 10 months earlier than the 

previous census.

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it. The mission of Bonus.com is to provide access to a rich 

selection of entertaining and educational works on the Web 

that educators may use in the classroom and that children 

will learn from and enjoy. The NASS site also received 

several other awards during 1998.

Dairy Products Prices

NASS implemented the Dairy Products Prices survey 

in September 1998 to collect prices for nonfat dry 

milk, butter, and dry whey. These price data are 

published weekly along with the ongoing cheese price series. The cheese price is the major component in the 

current milk price support formula (Basic Formula Price) that determines the minimum prices that plants can 

pay producers for milk. Under the proposed new formula, all of the above product prices would be used in the 

milk price support formula.

International Agricultural Statistics Conference 

NASS hosted the first International Conference on Agricultural Statistics, sponsored by the International 

Statistical Institute. Presentations and discussions focused on future needs for agricultural information, as well 

as new developments in technology and statistical survey methodology that will be required to meet those 

needs. The March 1998 conference, attended by over 250 participants from 50 countries, was deemed highly 

successful and brought NASS and USDA recognition for its leadership in promoting improved agricultural 

statistics throughout the world.

International Assistance Provided 

NASS provided technical assistance and training to improve agricultural statistics programs in 12 

countries. A NASS staff member continued a 2-year residency assignment in Ethiopia, and shortterm assignments supported work in Chile, China, Ecuador, Ethiopia, Kazakhstan, Mexico, 

Morocco, Nicaragua, Romania, Russia, Ukraine, and Venezuela. This technical assistance helps 

these countries improve agricultural data collection efforts, primarily through improved sample 

survey methodology. In addition, NASS’ International Programs Office coordinated and/or conducted training 

programs in the United States for 158 visitors representing 22 countries.

7. Promoting Quailty and Fair Trade Through Marketing and Regulatory 

Services

Mission

The mission of Marketing and Regulatory Programs is to facilitate the domestic and international marketing of 

U.S. agricultural products and to ensure the health and care of animals and plants while improving market 

competitiveness and the economy for the overall benefit of both consumers and American agriculture.

Efforts To Improve Oversight of Livestock Concentration

High concentration, forward sales contracts, production contracts, and vertical integration have raised major 

concerns about competition and trade practices in livestock and procurement by meat packers and poultry 

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processors. The Packers and Stockyards (P&S) program of the Grain Inspection, Packers and Stockyards 

Administration (GIPSA) is restructuring its headquarters and field offices to better focus on its core 

responsibilities—overseeing competition, trade practices, and payment protection. Eleven field offices have 

been consolidated into three regional offices. P&S is also incorporating economic, statistical, and legal 

expertise into investigations at the field office level to increase effectiveness in investigating anticompetitive 

practices and enforcing trade practice and payment protection.

Challenge to IBP’s Livestock Buying Method, Right of First Refusal

In August 1995, P&S filed a complaint alleging that IBP, Inc.’s use of an 

agreement to purchase cattle violated the Packers and Stockyards Act 

because the agreement was an unfair practice and gave unreasonable 

preference to a small group of Kansas feedlots by guaranteeing them the 

highest price paid for cattle in Kansas. The Chief Administrative Law 

Judge ruled that IBP’s use of the agreement was not an unfair practice.

P&S appealed the Administrative Law Judge’s decision to USDA’s 

Judicial Officer (JO). However, the JO ruled that IBP’s use of the 

agreement was not an unfair practice because the evidence did not prove 

that other feedlots or producers were harmed by the agreement. In 

addition, the JO ruled that the right of first refusal given to IBP under the 

agreement has the effect of reducing competition, and is, therefore, an unfair practice. IBP appealed the JO’s 

decision to the United States Court of Appeals for the Eighth Circuit.

Hog Procurement Investigation

USDA released the results of the Western Cornbelt Hog Procurement Investigation, recently completed by 

GIPSA. The investigation revealed substantial differences in hog characteristics and prices among pricing and 

procurement methods and seller sizes. Hogs sold on the spot market, hogs sold on a live-weight basis, liveweight pricing, and hogs sold by smaller sellers tended to exhibit lower hog quality characteristics and 

received lower prices. Price comparisons indicated that publicly reported prices did not reflect actual purchase 

prices. 

Orders Issued and Penalties Assessed 

Over the past 3 years, 115 decisions and orders have been issued against 183 individuals and firms for 

violating the P&S Act. The orders included more than $366,380 in civil penalties and 314 cease and desist 

provisions involving unfair trade practices or anticompetitive activities. 

New Toll-Free Number for Livestock Marketing Complaints

GIPSA established a toll-free number (1-800-998-3447) to allow producers and the general public to file 

complaints and report market abuse.

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Farmers Markets

Secretary Glickman joined local officials and 31 vendorfarmers July 2 to kick off the first USDA farmers market of 

the season. The Secretary encouraged Americans to eat 

more fruits and vegetables and announced the results of 

USDA’s Healthy Eating Index. He also praised the increase 

in farmers markets–a 35-percent rise in the number of 

farmers markets across the country since USDA began 

collecting statistics in 1993, and their benefits to consumers 

and small farmers.

New Technology To Measure Grain Moisture

GIPSA implemented a new official grain moisture 

meter, which marks a transition to new technology for 

moisture measurement for the official grain inspection 

system. The new meter offers increased speed and 

reliability.

Testing Services for Corn Oil, Protein, and Starch

As part of GIPSA’s efforts to keep pace with an increasingly sophisticated market that requires end-use quality 

information, it began offering a new testing service for corn oil, protein, and starch.

Opening Markets and Keeping Them Open

APHIS supports agricultural trade by providing our trading partners with scientific data indicating that U.S. 

products are free of pests and diseases of concern and ensuring that any trade restrictions placed on our 

products are based on sound science. As a result of these efforts, APHIS played a key role in removing 77 

foreign trade barriers in FY 1997. U.S. agricultural producers can now ship tomatoes to Japan; table grapes to 

China; lemons, kiwis, oranges, and grapefruit to Chile; sweet cherries to Mexico; live swine to Argentina and 

Peru; and rough rice to Ecuador. Annually, these new markets have been responsible for enabling $2.2 billion 

in threatened and new agricultural trade opportunities to take place. 

GIPSA worked with APHIS and the Foreign Agricultural Service to convince Sanidad Vegetal (the Mexican 

plant quarantine authority) to suspend implementation of two new regulations that would have halted exports 

of U.S. wheat and sorghum to Mexico for potential Tilletia controversa (Kuhn). 

Efforts Against Alien Invasive Species 

Recently, infestations of the Asian long-horned beetle–a highly destructive pest of maple and other hardwood 

trees–have been discovered in New York and Illinois. The introduction of this pest underlines the need to 

coordinate efforts to combat such introductions

APHIS is cooperating in Vice President Gore’s Alien Species Initiative, a program initiated in June 1997 to 

create a national strategy regarding the introduction of alien invasive species. More than 20 Federal agencies 

have some role in dealing with invasive plant and animal pests, which are estimated to cost U.S. agriculture 

more than $12 billion per year. Now, these agencies are coordinating their efforts through a National Invasive 

Species Council, which is currently working with State, local, and tribal governments. 

Control and Eradication Efforts 

APHIS is responsible for protecting U.S. agriculture from outbreaks of exotic animal and plant pests and 

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California Egg Partnership Wins Hammer Award

The California egg industry worked together with the 

California Department of Food and Agriculture, USDA’s 

APHIS and CSREES, FDA’s Los Angeles District, and the 

California Department of Health Services to develop a 

quality assurance plan that will ensure the highest quality 

and safety of eggs. Before this plan, there was no 

uniformity in the production of fresh eggs in California in 

these areas: rodent control, formal education or training in 

rodent control, or biosecurity. The California Egg Quality 

Assurance Plan is comprehensive and implements 

important provisions to protect the public health. There are 

guidelines for transportation, purchasing chicks, cleaning 

cages, and monitoring rodents. A multifaceted health plan 

covering medication and feeding is included in the 

certification program. The important steps of wash water 

and refrigeration are addressed. For employees, training 

and recordkeeping help ensure that employees are equipped 

and prepared to maintain quality and food safety. This plan 

demonstrates what can happen when Federal/State 

regulatory agencies and private industry work together 

toward a common goal.

diseases. For example, the Mediterranean fruit fly 

(Medfly) is one of the most devastating pests. After 

detections of the Medfly in Florida, APHIS joined 

State and local counterparts in a large-scale 

eradication effort. Due to this effort, no Medflies have 

been detected in Florida since FY 1998. 

APHIS has had success working with State and local 

cooperators on three major animal disease eradication 

programs: brucellosis, tuberculosis, and pseudorabies. 

Currently, 43 States, Puerto Rico, and the Virgin 

Islands have been recognized by the State-Federal 

brucellosis eradication program as brucellosis-free, 

and 45 States and the Virgin Islands are accredited 

free of bovine tuberculosis. While only 31 States are 

currently free of swine pseudorabies, APHIS expects 

to achieve total eradication of this disease by the end 

of the year 2000.

Yellowstone Bison 

APHIS has been actively involved with other Federal and State agencies in efforts to resolve the problems 

associated with the brucellosis-infected bison herd in Yellowstone National Park. The goal of these efforts is to 

reduce the potential for transmission of brucellosis from infected bison to livestock and disease-free bison and 

elk populations in the area. 

To determine a long-term strategy for the bison, a draft environmental impact statement (EIS) was published in 

June 1998 with the Department of Interior’s National Park Service, USDA’s Forest Service, APHIS, and the 

State of Montana as signatories. APHIS officials have finalized a brucellosis quarantine protocol for 

Yellowstone bison; animals that are certified free of brucellosis under this protocol will be able to be released 

to Native American tribes, parks, preserves, or other appropriate recipients. . 

Reduction in Fees

Cotton growers are paying less for cotton classification services than they did a few years ago. Through office 

consolidations, automation, improved automatic data handling, and the rapid utilization of newly developed 

equipment with lower labor requirements, the cotton classification fee for the 1998 crop is $1.30. In 1994 the 

fee was $1.80.

Bison Now Part of Food Purchase Program

Secretary Glickman’s April 30 authorization of up to $2.5 million to purchase ground bison helped to reduce 

the large inventories.

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Agricultural Marketing Service (AMS) Reaches Out to Small and Minority Vendors

In September 1998, 22 small firms representing a diverse cross section of more than 400 small meat, poultry, 

and fruit and vegetable processors and dealers were invited to a USDA workshop to explore ways to increase 

small business participation in USDA’s purchase programs.

Promoting Farmers Markets

Finding a farmers market whether in your State or in another State is as easy as flipping the pages of the 1998 

National Farmers Market Directory. The list of 2,746 farmers markets operating throughout the United States 

provides a comprehensive summary of market locations and hours of operation.

Let Your Fingers Do the Walking to the Farmers Market

Finding a farmers market on Federal property is as easy as dialing the farmers market hotline. By calling 1-800-

384-8704 farmers, vendors, customers, and market cooperators may obtain recorded information on dates, 

times, directions, and other information about participating in USDA-sponsored markets on Federal property.

Eggs-tra Eggs-tra

The poultry and egg industry is reading all about a wide range of supply, demand, and price information as 

well as market comments about international marketing of poultry and eggs in a new weekly poultry market 

news report. The weekly International Egg and Poultry Review is available every Tuesday on a subscription 

basis by facsimile transmission and free on the Internet.

$1.2 Million in Projects

Through AMS’ Federal State Marketing Improvement Program, USDA awarded $1.2 million for 24 projects in 

18 States in FY 1998. This will allow State agencies to conduct a wide range of research and service projects 

aimed at improving the marketing, distribution, and use of agricultural products.

One-Stop Shopping

Members of the produce industry seeking several market news reports can now visit the Market News 

Customer Service Center in Fresno, California. The Customer Service Center provides customers with 

consistent reports that are provided in a timely manner.

Small farmers now have a one-stop information source for AMS farmer direct marketing activities. The 

website, www.ams.usda.gov/directmarketing, provides State contacts and links to appropriate Federal, State, 

university, and other websites relating to direct marketing.

RuleMakingMadeEasy.Gov

USDA is a 1998 recipient of the Government Technology Leadership Award. The award is for AMS’ use of 

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the Internet and other communication technology in handling more than 280,000 comments received on its 

proposed rule for the national organic food and fiber standards.

People interested in marketing order information and Perishable Agricultural Commodities Act (PACA) 

information can view proposed rulemaking actions and electronically mail comments from both sites. 

Marketing Order information is available at www.ams.usda.gov/fv/modocketlist.htm and PACA information is 

available at www.ams.usda.gov/fv/paca/pro-regs.htm

Exporting Dairy Products

U.S. exporters to the European Union (EU) who ship cheese, ice cream, and other dairy products, as well as 

U.S. manufacturers who ship pizza, cheese crackers, cheese cake mixes, and other processed foods that contain 

dairy ingredients, will benefit from a new AMS certification program. AMS and a team of dairy industry 

representatives developed a comprehensive certification program that satisfies the European Commission’s 

equivalency requirements for dairy products exported to the European Union. Since April 1997, more than 

2,000 certificates have been issued, enabling 35 million pounds of U.S. dairy products to enter the EU.

8. Providing Administrative Support to the Department and Its Clients

Office of Inspector General

Mission

The Office of Inspector General’s (OIG) mission is to conduct and supervise audits and investigations to 

prevent or detect fraud and to improve the effectiveness of USDA programs by recommending changes that 

will increase efficiency and reduce wasteful and fraudulent activities.

Secretary Receives Civil Rights Award

On February 17, on behalf of all 18 of the 1890s land-grant 

colleges and universities, the president of Langston 

University presented Agriculture Secretary Dan Glickman 

with an award recognizing his leadership on civil rights 

issues at USDA.

Recoveries and Savings

In FY 1998, OIG identified $63.9 million in recoveries 

and collections and $48.6 million in fines and 

restitutions. OIG also identified $39.5 million in 

questioned costs that cannot be recovered. Another 

$127.9 million was identified for which management made commitments to put funds to better use. OIG 

efforts also resulted in 777 criminal indictments and 604 convictions.

Operation Talon Shows Continued Success in Apprehending Fugitives From Justice

Operation Talon is a Presidential initiative designed to locate and apprehend fugitive felons, many of them 

violent offenders, who are current or former food stamp recipients. Operation Talon has been expanded to 

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Multimillion-Dollar Food Stamp Trafficking Cases 

Cracked in Several States

OIG cracked multimillion-dollar food stamp trafficking 

cases in several States. Twenty-four individuals have been 

arrested in the southern district of New York on an 

estimated $60 million food stamp fraud and money 

laundering conspiracy. During a 2-year investigation in 

Philadelphia, Pennsylvania, an elaborate scheme was 

uncovered involving $15 million of food stamp trafficking 

and money laundering. Also in Philadelphia, the owner of 

four retail stores pled guilty to fraudulently purchasing 

approximately $5.4 million in food stamps and laundering 

$4.8 million in funds. In Georgia, a grocer was sentenced to 

serve 5 years in prison and ordered to pay over $3.9 million 

in restitution after he pled guilty to charges of money 

laundering and redemption of illegally received food 

stamps.

include 34 metropolitan areas in 23 States, and 3,206 

fugitive felons had been arrested as of September 30, 

1998.

Presidential Initiative in the Child and Adult Care 

Food Program (CACFP) Continues With Operation 

“Kiddie Care”

Operation “Kiddie Care” continues to detect fraud 

committed by CACFP sponsors around the country; as 

of September 11, 1998, 53 sponsors in 23 States were 

being audited or investigated. As part of Operation 

“Kiddie Care,” 13 sponsors have been terminated from 

CACFP. These 13 had been receiving $24.2 million in 

program funds annually.

Office of Chief Financial Officer

Mission

The Office of the Chief Financial Officer (OCFO) will shape an environment in which USDA officials have 

and use high-quality financial and performance information to make and implement effective policy, 

management, stewardship and program decisions.

National Finance Center Achieves Year 2000 Compliance Goal 

OCFO’s National Finance Center (NFC) in New Orleans met a self-imposed deadline to make all its systems 

Year 2000 compliant. The NFC provides payroll/personnel services to 435,000 employees from USDA and 

100 other Federal agencies, accounting for one-fifth of the entire Federal Government. NFC’s systems include 

the Federal Government’s Thrift Savings Plan, which is the $67 billion 401(k) retirement plan with 2.3 million 

participants.

Reaching Out to Small and Minority Businesses

USDA’s Office of Small and Disadvantaged Business 

Utilization participated in the Florida Black Business 

Board’s Second Annual “Black Business Investment Day” 

March 13 in Tallahassee, Florida. It also participated in a 

workshop March 16 in Wilson, North Carolina, on “Doing 

Business With Your Government.”

OCFO’s National Finance Center Marks Civil 

Rights’ Progress 

OCFO’s NFC unveiled Inclusion University, a selfpaced optional program for employees who want to 

expand their understanding of diversity issues in the 

workplace. An NFC original, this program is the first 

of its kind in the Federal Government. This effort and other initiatives contributed to a 36-percent decline in 

informal EEO complaints and a 41-percent decline in formal EEO complaints.

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USDA Increases Debt Collection by 45 Percent in FY 1998 

USDA collected $78.3 million in delinquent debt for the first 9 months of 1998 from the Tax Refund Offset 

Program (TROP) and Treasury Offset Program (TOP). This figure exceeds the $53.7 million collected during 

the same period in 1997 by about 45 percent. 

Office of the Chief Information Officer

Mission

The mission of the Office of the Chief Information Officer (OCIO) is to strategically acquire and use 

information technology resources to improve the quality, timeliness, and cost effectiveness of USDA service 

delivery to its customers. The following accomplishments reflect the OCIO’s efforts to achieve that mission.

USDA Workshop Focuses on Working Effectively With 

American Indians

One of USDA’s Native American liaison officials served as 

instructor the week of August 2 at a workshop on “Working 

Effectively with American Indians” in Lac du Flambeau, 

Wisconsin, to improve the delivery of USDA conservation 

programs to this historically underserved group.

USDA Makes Progress in Addressing “Year 2000” 

Problem

USDA launched an aggressive in-house and outreach 

program to address Year 2000 computer and 

embedded chip problems and to ensure the 

uninterrupted delivery of its programs and services. 

These include food stamps to some 25 million Americans, loans and payments to millions of farmers, child 

nutrition programs, and programs to promote agricultural trade and to protect the environment. USDA 

identified 643 “mission-critical” systems: at the end of the fiscal year, 502 or 78 percent of those systems were 

Year 2000 compliant. Ninety-four percent of the 332 systems undergoing repair met the renovation milestone 

date. OCIO’s National Information Technology Center (NITC)—which provides information management 

services and technology to support USDA agencies, the Federal Aviation Administration, and other 

agencies—successfully migrated its mainframe computer system to a Year 2000 compliant operating system. 

In addition, USDA leads the Food Supply Working Group of the President’s Council on Year 2000 

Conversion—raising awareness and working with industry partners to address potential Y2K- related problems 

in the farm-to-table food supply chain.

“One-Stop Service” for Customers Moves a Step Closer to Reality

USDA purchased the first increment of new technology required to fulfill our promise of providing “one-stop 

service” for farmers, ranchers, and customers of rural development programs. This historic milestone 

represents an important first step in moving away from “stove pipe” service delivery toward a shared 

information system for USDA’s farm, conservation, and rural development agencies. When the “Common 

Computing Environment” is complete, customer benefits and payments will be processed electronically, and 

much faster; customers will no longer have to provide the same information to different USDA agencies 

because they will share a common data base; customers will be able to access program information and apply 

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OCIO’s National Information Technology Center Helps 

Agencies Fight Fires, Research Plants

OCIO’s National Information Technology Center (NITC) 

continued to improve the ability of USDA agencies to 

deliver critical programs and services. For example, new 

technology “platforms” will improve the Forest Service and 

other land management agencies’ ability to report risks, 

including fires, hurricanes, and floods; access up-to-theminute weather information; and manage crews on the front 

lines. The system will include Internet access, maintenance 

of historical data, and enhanced reporting capabilities. Key 

improvements have also been made in the “Plants” website. 

Developed by USDA’s Natural Resources Conservation 

Service, the Plants site now serves approximately 40,000 

users every month, providing field office employees, 

academic researchers, farmers, businesses, and average 

citizens a single source of standardized information about 

plants.

from home; and the paperwork burden on USDA 

customers will be significantly reduced. USDA 

employees, freed from no-value-added work, will have 

more time to provide direct assistance to customers.

Office of the Chief Economist

Mission

The mission of the Office of the Chief Economist 

(OCE) is to advise the Secretary of Agriculture on the 

economic prospects in agricultural markets and the 

economic implications of policies, programs, and 

economic events affecting U.S. agriculture and rural 

communities; to ensure the public has consistent, 

objective and reliable agricultural forecasts; and to 

promote effective and efficient rules governing 

Departmental programs. OCE was created by the Secretary under the authority of the Federal Crop Insurance 

Reform and Department of Agriculture Reorganization Act of 1994, Public Law 103-354.

OCE consists of the Chief Economist and Immediate Staff, the Office of Risk Assessment and Cost-Benefit 

Analysis, the Global Change Program Office, and the World Agricultural Outlook Board. Three major 

functions are carried out by OCE: (1) economic intelligence, policy, and program coordination, which includes 

farm labor, small farms, sustainable agriculture, global change, and energy activities; (2) agricultural estimates 

and projections; and (3) regulatory analysis.

Small Farms Commission Report

On January 22, 1998, Secretary Glickman accepted the 

report of the Small Farms Commission, which was formed 

in response to a recommendation by USDA’s Civil Rights 

Action Team. The report contained 146 recommendations. 

Deputy Secretary Rominger was named to lead an 

interagency team to develop an integrated Departmental 

strategy to help small farmers.

Accomplishments

In the face of growing concern about agriculturerelated hazards to human health and the environment, 

the Department is applying sophisticated new 

techniques to pinpoint risks and options for reducing 

them. In the past year, the Office of Risk Assessment 

and Cost-Benefit Analysis provided technical support 

for USDA risk assessments for Salmonella in eggs, irradiation of beef, pests in wood pallets imported from 

China, foot-and-mouth disease in beef from Argentina and South Africa, and hog cholera in Mexico. Costbenefit analysis also helps monitor the impact and effectiveness of new programs. USDA is undertaking case 

studies to determine the efficacy of the Environmental Quality Incentives Program and the Conservation 

Reserve Program.

USDA is making sure that U.S. agricultural concerns about climate change and efforts to mitigate it are heard 

as the world community decides how to implement the 1997 Kyoto Accords. Risks associated with climate 

change and climate variability such as temperature and precipitation changes, as well as an increase in extreme 

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weather events, could have a big impact on agriculture, forestry, and rural areas. The Department’s Global 

Change Program Office has been an active member of the U.S. delegation at meetings on the U.N.-sponsored 

Accords and has taken part in other domestic and international climate change activities.

In the past year, USDA used scientific analysis to challenge claims by China and Brazil that U.S. wheat would 

spread fungal diseases. USDA scientists and meteorologists presented evidence demonstrating that neither 

country has climatic conditions that support the spread of TCK smut or karnal bunt. This information greatly 

weakened the arguments for banning U.S. wheat imports. Brazil recently removed TCK smut from its list of 

quarantined diseases that block imports and has announced it will permit imports of hard red winter wheat 

grown in seven U.S. States. 

USDA is working with the National Weather Service (NWS) to ensure that agriculture’s essential data needs 

can be supplied despite cutbacks in NWS specialized weather services. As the first step in developing a 

national agricultural weather observing network, OCE’s World Agricultural Outlook Board has stationed the 

first field meteorologist for the network at the Agricultural Experiment Station in Stoneville, Mississippi, reopening this former NWS site.

In addition, USDA acquired access through the Department of Defense to more than 10,000 satellite images 

which are available at no cost and which potentially represent a cost savings of $400 to $4,400 per image. 

Departmental agencies use satellite imagery to manage forests, monitor natural resources, forecast crops, and 

conduct farm programs.

USDA Readies Puerto Rico Summer Internship 

Program

USDA’s Farm Service Agency cosponsored an internship 

program for the Puerto Rico USDA Center of Excellence 

for Hispanic Americans in the summer of 1998, employing 

seven college students to work at the FSA Puerto Rico 

State office.

Under the auspices of the United States/South Africa 

Bi-National Commission, USDA’s World Agricultural 

Outlook Board has been showing South Africa how to 

forecast the impact of its highly variable climate on 

crop production. The Board arranged for a technical 

exchange between the developers of the Oklahoma 

“Mesonet” and scientists representing South Africa’s 

Agricultural Research Council. In return, we now receive real-time weather data collected by South African 

counterparts.

Similarly, an ongoing information exchange with China has yielded substantial analytical benefits. The 

Department’s economic and statistical agencies are helping China improve agricultural data collection and 

statistical practices at the local level. Through participation in this project, USDA has substantially improved 

its information base with respect to the present and future of China’s agricultural sector.

Departmental Administration 

Mission

Departmental Administration’s mission is to provide the most effective and efficient administrative 

management leadership and services to support USDA agencies and enable the Department to reach its 

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programmatic goals.

Bringing Rural America Venture Opportunities (BRAVO)

The Office of Small and Disadvantaged Business Utilization (OSDBU), in concert with its USDA partners, 

initiated the BRAVO Program. BRAVO will establish partnerships with American Indian and Alaska Native 

tribes, 1890 and 1994 institutions, Hispanic American colleges and universities (HACU), small disadvantaged 

companies, private corporations, and government organizations to revitalize and enrich targeted rural 

communities. 

USDA Purchase Card and Fleet Card Consolidation A Success

On August 7, 1998, USDA awarded a task order to NationsBank to replace the current purchase card and fleet 

card service contracts. This award provides streamlined credit card services to the cardholders of USDA, and 

utilizes the state-of-the-art Purchase Card Management System (PCMS) allowing USDA employees to buy 

goods and services faster and at lower administrative costs. PCMS, upon full deployment, will offer 

approximately 18,000 purchase cardholders and 40,000 fleet cardholders an on-line reconciliation system that 

eliminates monthly statement and invoice processing, provides improved management oversight, demonstrates 

a user-friendly environment, and offers administrative cost avoidance savings in the coming years. 

USDA Joins Executive Order 13101

The President issued Executive Order 13101, “Greening the Government through Waste Prevention, Recycling 

and Federal Acquisition,” to strengthen the environmental policies of the Administration. USDA joined in this 

current initiative with its own biobased products to be promoted as environmentally preferable products. For 

the first time, USDA will attempt to link rural job growth, agricultural production, and the use of agricultural 

waste products to the sale of environmentally preferable products.

Vice President’s National Performance Review, Silver 

Hammer Awarded to the Office of Operations (OO) 

OO, in cooperation with the Rural Utilities Service and the 

Office of the General Counsel, was awarded the Silver 

Hammer Award for reinvention of the cooperative utility 

loan program. The average turnaround time for loans was 

reduced from 6 months to 2 weeks. OO reduced the 

printing lead time from 5 days to 22 minutes using print-ondemand technology. This expedites loan services to USDAsupported cooperative utilities and improves their services 

to their rural customers.

Contracts Mean Jobs for Persons with Disabilities

USDA achieved its strongest results to date providing 

a wide variety of jobs to persons with disabilities. 

Under the Javits-Wagner-O’Day Act Program, USDA 

created more than 75 new full- time jobs for persons 

with disabilities. The single largest contract of the year 

provided more than 60 jobs performing the facilities 

management services at USDA’s new Beltsville Office 

Complex. More importantly, this contract is a 

hallmark action, being the first Commercial Facility 

Manager that has been awarded to a Community Rehabilitation Program by the Federal Government, opening 

a new service industry with potentially hundreds of jobs nationwide. 

Complaint Backlogs Continue To Be Reduced

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Progress was made on reducing the backlog for both program complaints and EEO complaints. By October 31, 

1998, 479 program complaints had been closed out of the 1,088 that were active at the start of the year. On the 

EEO complaint side, 806 were closed out of the 1,523 that were active at the start of the year. 

Major Program Complaints Resolved 

Ten farm program discrimination complaints were resolved with findings of discrimination, and significant 

remedies were negotiated. As a result, debt write-off and expenses for these cases totaled $1,055,248 and 

compensatory damages awarded in these cases totaled $1,804,725.

Beltsville Office Facility—An Award-Winning Facility

The new Beltsville Office Facility received a Federal Energy Saver Showcase Award from the Department of 

Energy. The award recognizes Federal facilities operating at their peak efficiency by using energy resources 

wisely. A Certificate of Merit for Excellence in Construction was received on September 16, 1998, from the 

Associated Builders and Contractors, Inc. The September 1998 issue of Building Design and Construction 

magazine includes a positive article on the success of the complex and the innovative procurement process.

Office of Operations (OO) Is Recognized by the National Institute of Building Sciences 

For the headquarters buildings in Washington, DC, OO was recognized by the National Institute of Building 

Sciences, a nongovernmental, nonprofit organization authorized by Congress to encourage and accelerate the 

introduction of existing and new technology into the building process. An article in the publication 

“Excellence in Facility Management—Five Federal Case Studies” recognized the challenges faced in 

maintaining beautiful, old, and historically significant buildings and commended USDA for its Energy 

Management Program and for “going the extra mile” for the betterment of the facilities.

USDA Acquisition Toolkit Provides Innovative Web 

Technology to User Community

USDA deployed its Acquisition Toolkit via the Internet on 

March 27, 1998, offering users substantial time savings in 

the procurement process. One tool (direct access to the 

Department of Labor Service Contract and Construction 

wage determinations) gives agency procurement personnel 

immediate access to wage determinations that can be 

incorporated as official determinations in contract 

solicitations. Downloading time for this system averages 5 

minutes. Previously, acquisition personnel had to request 

such determinations manually with administrative lead 

times averaging 30 days. This new Toolkit offers the users 

and customers of the USDA acquisition community a suite 

of tools selected from commercial and government 

acquisition solutions. The USDA Acquisition Toolkit can 

be found on the USDA Procurement Home Page at 

www.usda.gov/da/procure.html 

Welfare to Work (W2W) Goal

USDA’s OHRM has Departmentwide leadership 

responsibility to develop and implement this Welfare 

to Work (W2W) Presidential Initiative. USDA works 

with the National Performance Review (NPR) and 

Office of Personnel Management (OPM) to refine the 

requirements of the initiative, identify barriers and 

challenges, and develop appropriate regulations. In 

less than 3 years, USDA has hired 374 employees 

under this initiative. This number for 1999 is just one 

less than the goal of 375 hires by the end of fiscal year 

2000. Not only is USDA committed to helping welfare 

recipients obtain employment, USDA is committed to 

helping hired employees advance. For example, 

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Marketing and Regulatory Programs (MRP) 

established a website of W2W contacts for Federal, State, nonprofit, and community-based organizations to 

assure wide distribution of MRP’s vacancy announcements. MRP has hired more than 100 former welfare 

recipients. Rural Development brings employees in at the GS-3 level, then provides training and experience 

leading to the GS-7 level.

USDA Creates Departmental Office of Ethics

An Office of Ethics was established under the Assistant Secretary for Administration to support and oversee 

ethics training, counseling, and financial disclosure throughout the Department. Among other start-up 

activities, this office is engaged in developing new, more efficient means of reaching USDA employees 

worldwide with guidance regarding the executive branch-wide Standards of Conduct, the criminal code on 

conflicts of interest, and the Hatch Act rules governing political activity by government employees. 

USDA Establishes a Conflict Resolution Center

A USDA Conflict Prevention and Resolution Center was established in March 1998. This office is charged 

with promoting effective conflict management practices to address disputes with customers and employees. 

The center’s emphasis will be on providing education to develop conflict resolution skills, as well as greater 

use of alternative dispute resolution techniques to resolve disputes quickly and inexpensively.

USDA Agencies and Acronyms

● AMS - Agricultural Marketing Service

● ARS - Agricultural Research Service

● APHIS - Animal and Plant Health Inspection Service

● CNPP - Center for Nutrition Policy and Promotion

● CSREES - Cooperative State Research, Education, and Extension Service

● ERS - Economic Research Service

● FAS - Foreign Agricultural Service

● FNS - Food and Nutrition Service

● FS - Forest Service

● FSA - Farm Service Agency 

● FSIS - Food Safety and Inspection Service

● GIPSA - Grain Inspection, Packers and Stockyards Administration

● NASS - National Agricultural Statistics Service

● NRCS - Natural Resources Conservation Service

● RBS - Rural Business - Cooperative Service

● RHS - Rural Housing Service

● RMA - Risk Management Agency

● RUS - Rural Utilities Service

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The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the 

basis of race, color, national origin, gender, religion, age, disability, political beliefs, sexual orientation, and 

marital or family status. (Not all prohibited bases apply to all programs.) Persons with disabilities who 

require alternative means for communication of program information (Braille, large print, audiotape, etc.) 

should contact USDA’s TARGET Center at (202) 720-2600 (voice and TDD).

To file a complaint of discrimination, write USDA, Director, Office of Civil Rights, Room 326- W, Whitten 

Building, 14th and Independence Avenue, SW, Washington, DC 20250-9410 or call (202) 720-5964 (voice or 

TDD). USDA is an equal opportunity provider and employer.

Mention or depiction of commercial products in this report does not constitute endorsement by the U.S. 

Department of Agriculture over other products and organizations not mentioned or depicted.

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1998 Annual Report of the Secretary of Agriculture

USDA: Preparing for a New Millennium 

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1998 Accomplishments—Year at a Glance 

Our USDA successes for 1998 included—

Expanding opportunities and assistance for America’s family farmers 

● President Clinton fought for and won a strong emergency assistance package for America’s farmers—one that 

includes 40 percent more funds than the original bill he vetoed. Nearly $3 billion in assistance reached farmers before 

Thanksgiving, and an additional $3 billion will be distributed before spring 1999.

● USDA’s Commodity Credit Corporation (CCC) made commodity loans of about $7.2 billion to producers, $1.6 

billion higher than last fiscal year. To offset lost farm income, CCC will also make about $2.8 billion in loan 

deficiency payments, and marketing loan gains on 1997 and 1998 crops. 

● Using sound science, USDA broke through 77 barriers stifling U.S. farm trade, enabling $2.2 billion in threatened 

and new agricultural trade opportunities to take place. Carrying out President Clinton’s Food Aid Initiative, the 

Department began purchases of more than 185 million bushels of wheat for donation to hungry people around the 

world. We increased by 40 percent—to $4 billion—the export sales registered under our export credit guarantee 

programs. This enabled U.S. exporters to complete sales of 201 million bushels of wheat, 227 million bushels of corn, 

104 million bushels of soybeans, and nearly 2 million bales of cotton. 

● USDA led successful discussions with Canada about access for U.S. wheat, cattle, hogs, and other trade issues. 

USDA opened the Taiwanese market for U.S. pork, poultry, and beef—and reopened Brazil’s market for U.S. wheat. 

● USDA’s Farm Loan Program provided over $2.1 billion in assistance to over 26,000 family farmers in FY 1998. 

About $367.1 million of these funds helped 3,186 minority and women farmers. And more than $490 million in direct 

loan assistance benefitted over 7,000 beginning farmers this fiscal year, a 6-percent increase. 

● USDA responded quickly when farmers suffered devastating losses, approving disaster designations for counties in 

43 States. The Department made over $97.5 million in low-interest emergency loans and disbursed $26.5 million in 

emergency conservation funds. USDA provided $22.9 million in emergency benefits to farmers with uninsurable 

crops, $2.8 million to orchard and vineyard owners, and $4.9 million to livestock producers. 

● USDA added economic and legal expertise to strengthen investigations of anticompetitive practices that hit small 

farmers and ranchers hardest. 

● To help avert a repeat of 1997’s gridlock in rail transportation, USDA hosted a National Summit on Agricultural 

Transportation, which set the groundwork for a comprehensive plan to meet agriculture’s long-term transportation 

needs. The Department also created an early warning system to anticipate demand for railcars by grain shippers. 

● USDA proposed the first rule on national standards for organic foods, using the Internet in an unprecedented public 

review and comment process. The Secretary also offered a proposal to reform Federal dairy policies. 

● For the first time, USDA—not the U.S. Bureau of the Census—conducted the census of agriculture. And, for the first 

time, all farmers on American Indian reservations were counted. 

● USDA took new steps to improve the safety net for farmers, expanding crop insurance to new crops and new areas. 

More than $1.4 billion in crop insurance indemnities—a record—were paid out to farmers. 

Creating jobs and helping to revitalize rural America

● USDA helped 68,000 rural Americans buy homes and created or saved 215,000 rural jobs in 1998. The Department 

invested more than $9 billion in rural development projects. In FY 1998, USDA invested $4 billion to help rural 

Americans buy or build single-family houses, making the dream of home ownership a reality for 68,000 households. 

● USDA also helped renters, spending $219 million for loans and grants for the construction of 3,942 affordable 

apartment units and the repair or upgrade of 5,682 apartments in rural areas. USDA provided $545 million to help 

low-income rural renters. 

● USDA provided $286 million in loans and grants to build or expand community facilities that benefit more than 2.7 

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million rural residents. These investments include more than $110 million for 147 rural health care facilities, $13 

million for 46 child care centers, and $36 million for 262 fire and rescue facilities. Another $54 million helped 

develop other community resources, including job training facilities, libraries, and courthouses. 

● At $60 million, USDA loans to rural cooperatives nearly doubled this year. The Department has earmarked $200 

million for funding co-ops in 1999. 

● USDA provided $1.3 billion in loans and grants to build or improve 1,021 water and sewer systems, helping to bring 

clean, safe drinking water to more than 2 million rural Americans. 

Ensuring wise stewardship of the land 

● CCC expanded the Conservation Reserve Enhancement Program to help six States, protecting New York’s drinking 

water as well as habitats for endangered salmon and trout in the Pacific Northwest. 

● CCC enrolled 211, 917 acres in the Wetlands Reserve Program in fiscal year 1998. This brings the total area that is 

being restored and protected under the program to 665,447 acres. 

● USDA began implementing the Wildlife Habitat Incentives Program in fiscal year 1998. Landowners enrolled more 

than 670,000 acres in long-term agreements under the new program, in return for technical and financial assistance 

from USDA. 

● USDA provided technical assistance to more than 740,000 farmers, ranchers, other land users, and units of 

government. As a result of these services, the planning decisions and management applied by resource managers on 

about 61 million acres of agricultural and other rural land will help to sustain resource productivity and enhance 

environmental quality. 

● USDA provided $17.2 million to 19 States through the Farmland Protection Program, leveraging about $95 million in 

state and local funds, to preserve endangered American farmland.

● The USDA funds helped acquire permanent easements to preserve almost 45,700 acres in agricultural use. Over the 3 

years of the program, more than 127,000 acres have been protected. 

● USDA worked with State and local governments and other Federal agencies to begin implementation of the 

President’s Clean Water Action Plan. Unified Watershed Assessments were completed in every State to identify 

watersheds with the most critical water quality concerns and to develop strategies to improve water quality in high 

priority watersheds. In addition, USDA and the U.S. Environmental Protection Agency developed a draft Unified 

National Strategy for Animal Feeding Operations (AFO’s) and released it for public comment. The Strategy identifies 

national performance expectations for AFO owners that will reduce potential water quality risks posed by animal 

feeding operations. 

● USDA employees at the Camino Real Ranger District in New Mexico won the prestigious Innovations in American 

Government Award for unifying a deeply divided forest community. 

● USDA embarked on an ambitious natural resources agenda for the 21st century, setting clear priorities for scientists 

and managers and holding them accountable for sustaining the health of America’s forests and grasslands. 

● To prevent further damage by the dangerous Asian long-horned beetle, USDA banned untreated solid wood packing 

materials from China and helped remove more than 2,500 afflicted trees in New York. 

● USDA has lifted all Florida Mediterranean fruit fly quarantines, and no Mediterranean fruit flies have been detected 

in Florida since 1998. The Department is working toward its eradication in California to protect valuable fruit and 

vegetable crops. 

● The Department collected approximately $20 million from 65 recreation fee demonstration projects on national 

forests and grasslands in 1998. Most of these funds are used to maintain and improve trails, recreational facilities, 

visitor services, signs, and health and safety features for the forests’ and grasslands’ 800 million visitors. 

● USDA researchers developed an award-winning bio-pulping technology that uses wood-decay fungi to soften wood 

chips, eliminating environmental problems, reducing energy costs by at least 30 percent, and producing stronger 

paper. 

● In 1998, USDA launched a new approach to forest road management to improve service to users, protect 

environmental values, enhance public safety, reduce damage to the environment, and better serve local transportation 

needs. A moratorium was proposed on new road construction in certain unroaded national forest areas. 

Modernizing our food safety system, using science to ensure safety from farm to table 

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98 Annual Report/Year at a Glance

● USDA implemented HACCP, the new, science-based food safety inspection system, in the Nation’s 300 largest meat 

and poultry plants. Preliminary data indicate that the new system is already working, reducing Salmonella 

dramatically in pork and broiler chickens. 

● President Clinton established the President’s Council on Food Safety to coordinate resources and policies to better 

prevent foodborne illness. He also set up the Joint Institute for Food Safety Research to ensure effective coordination 

of research among food safety agencies and FORC-G to ensure a rapid and effective government response to 

foodborne illness outbreaks. 

● USDA researchers developed an anti-Salmonella spray that may help poultry producers significantly reduce 

Salmonella contamination on the farm. They also created a new variety of corn that can reduce phosphorous in pig 

and chicken waste by 50 percent. 

Feeding America’s hungry children and families—and promoting food recovery 

● USDA nutrition assistance programs helped feed about 1 in 10 Americans. In 1998, nearly 20 million needy people 

received food stamps to help feed their families. More than half of the 5 billion school meals served to children this 

year were provided free or at a reduced price. And USDA’s WIC program provided nutritious supplemental foods to 

7.4 million at-risk women, infants, and children to help ensure a healthier America.

● Congress passed President Clinton’s legislative proposal to reauthorize child nutrition programs, including an 

expansion of after-school snack programs so communities can move teens off the streets. The President also 

successfully fought for restored food stamp benefits for our most vulnerable legal immigrants, including children. 

● USDA’s Inspector General’s “Operation Talon” caught more than 3,500 fugitive felons, many of them violent 

offenders, who were former food stamp recipients. 

● USDA employees donated hundreds of thousands of pounds of food to community kitchens, and field-office gleaning 

efforts delivered tons of fresh produce to families in need. 

Aggressively addressing long-standing civil rights issues 

● President Clinton and I won congressional passage of a waiver of a statute of limitations, so USDA could settle older 

civil rights cases. The Department restaffed its civil rights enforcement unit and cut in half the backlog of 

discrimination complaints. Civil rights training began for all employees. 

● The Office of Civil Rights investigated 131 program discrimination complaints in FY 1998. Its investigative unit had 

been eliminated in 1982, and no more than a handful of cases had been investigated annually since that time. 

back to 

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Contents page to: Publications

News and Information

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1998 Annual Report of the Secretary/ ARP 1

FY 1998 Annual Report of the Secretary of Agriculture

USDA: Preparing for a New Millennium 

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1.Increasing Production, Trade, and Opportunities for Family Farmers

Farm Service Agency 

Mission

Farm Service Agency’s mission is to ensure the well-being of American agriculture and the American public through 

efficient and equitable administration of farm commodity, farm loan, conservation, environmental, emergency assistance, 

and domestic and international food assistance programs. 

Farm Safety Net

Farm Loan Program

In FY 1998, the Farm Service Agency (FSA) provided over $2.1 billion in loan assistance to over 26,000 family farmers. 

The Agency:

● Provided $789 million in 15,620 direct loans, and $1.435 billion in 10,557 guaranteed loans to family farmers in rural 

America. 

● Provided $367.182 million direct and guaranteed loans to 3,186 minority and women farmers in FY 1998, exceeding 

the targeted allocation set by Congress by 191 percent. 

● Provided over $490 million in direct loan assistance to more than 7,000 beginning farmers, a 6-percent increase over 

FY 1997. 

● Published new proposed rule and developed final rule to streamline the procedures for lenders obtaining FSA loan 

guarantees. 

● Initiated new foreclosure and lending policies at USDA in an effort to assure that no farmers will lose their farm 

because of discrimination. 

● Developed new farm business plan software for use by customers on their home computers as well as by FSA 

employees. This software will help farmers develop yearly business plans to make their operations as efficient and 

profitable as possible. 

● Decreased direct farm loan delinquency from $2,124,682,363 in FY 1997 to $1,764,873,822 in FY 1998. This is 

significant, considering the low commodity prices and adverse weather conditions that existed throughout the year. 

● Decreased the number of Farm Inventory properties from 1,131 in FY 1997 to 791 in FY 1998.

Guaranteed loan delinquency remained low at 2.63 percent, and guaranteed loan loss rate remained less than 1 percent (.78). 

These figures are significant, considering the low commodity prices and adverse weather conditions that existed throughout 

1998.

CCC Nonrecourse Marketing Assistance Loan and Loan Deficiency Payment Program

Nonrecourse marketing assistance loans, for which production of a commodity serves as collateral, allow farmers to pursue 

alternative marketing strategies at a time when prices typically are at the seasonal harvest-time lows. Loan deficiency 

payments (LDP’s), an option to loans, provide eligible producers with direct payments when prices are low.

CCC made the following efforts in fiscal year 1998 to help 

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Farm Forums

On April 3 in Lexington, Kentucky, Secretary Glickman kicked off 

the first of seven farm forums around the country. A crowd of 700 

farmers, local and State officials, and agribusiness leaders were 

mainly interested in tobacco issues. Deputy Secretary Richard 

Rominger had a farm forum April 3 in Orono, Maine, where over 

250 farmers raised concerns about dairy policy, Canadian imports, 

and ice damage. On April 6 Deputy Secretary Rominger spoke to 

over 200 farmers in Greenville, Florida. On April 7, Secretary 

Glickman met with over 200 farmers in Las Cruces, New Mexico, 

and Deputy Secretary Rominger met with nearly 200 farmers in 

Salinas, California, the same day about dairy and pesticide 

concerns. In Aberdeen, South Dakota, Secretary Glickman talked 

with farmers about cattle prices and wheat issues, and on April 8 in 

Ames, Iowa, Secretary Glickman and Deputy Secretary Rominger 

hosted another town hall meeting with 500 farmers on the campus 

of Iowa State University.

offset farm income losses due to low prices and the adverse 

effect of natural conditions on the quality of farmers’ output:

● Made a total of $7.2 billion in marketing assistance loans to 

producers. This was $1.9 billion higher than the previous 

fiscal year, when prices were generally much higher. 

● Held forfeitures to a fraction of the levels observed in the 

mid-1980’s when crop prices were also low. 

● Broadened the eligibility for marketing loans and loan 

deficiency payments. For example, the change allowed 

producers who harvested corn for silage to be eligible for 

marketing assistance loans and LDP’s and for producers with 

sample grade wheat, contaminated corn, or other below grade 

commodities also to be eligible for these benefits. 

● In September 1998 made $3.2 billion in final Production 

Flexibility Contract payments for FY 1998, bringing the total 

for the fiscal year to $5.66 billion. 

USDA Responds to Natural Disasters Hurting 

Agriculture

● In June 1998, CCC authorized emergency grazing of 

Conservation Reserve Program acreage in Montana, North 

Dakota, South Dakota, and Texas, where severe weather 

conditions had depleted hay supplies or impaired the 

growth of hay and pasture. In addition, FSA allocated 

$730,000 in Emergency Conservation Program funds to six 

Montana counties to help livestock producers provide 

water to livestock. 

● On July 9, Secretary Glickman declared Florida a disaster 

area, making farmers throughout the State eligible for lowinterest emergency loans from FSA to recover from 

damage related to fire and drought. Also on July 9, the 

Secretary met with farmers and State agricultural officials 

in the Orlando area, to review the agricultural damage in 

the State. 

● In July, Secretary Glickman declared Georgia, Florida, and 

many counties in Texas to be disaster areas, making 

farmers and ranchers in those places eligible for emergency 

loans from USDA. In addition, to alleviate the droughtinduced forage shortage, CCC allowed farmers in Texas to 

use hay land enrolled in the Conservation Reserve Program 

on an emergency basis, and allowed emergency grazing in 

10 other States for the same reason. 

● On July 28 and 29, Secretary Glickman toured farms hurt 

by the drought in Oklahoma and Texas to inspect drought 

damage and met with agricultural leaders and experts in 

College Station, Texas, to assess the economic implications 

of the disaster. 

● On July 29, Secretary Glickman held a round table on the 

drought and its effects on the Texas economy, with State 

officials, farmers, and academics at Texas A&M 

University. 

● Following the President’s announcement on July 23, 1998, 

that Texas farmers and ranchers are eligible for lowinterest loans from FSA to help them recover from the 

Emergency Assistance

CCC and FSA have:

● Approved disaster designations for counties in 43 

States. 

● Developed the FSA Hay Net, a program helping 

producers in need of hay to connect with those that 

had it. 

● Approved haying and grazing of CRP acres in many 

States to allow producers to feed cattle in disasterstricken areas. 

● Made over $97.5 million in low-interest emergency 

loans. 

● Disbursed $26.5 million in Emergency Conservation 

Program cost share assistance. 

● Disbursed $22.9 million in Noninsured Disaster 

Assistance Program benefits. 

● Disbursed $2.8 million in Tree Assistance Program 

benefits. 

● Disbursed $4.9 million in Livestock Indemnity 

Program payments. Administered additional programs 

to producers as a result of legislation providing over 

$6 billion for economic and natural disaster relief. In 

addition, as announced by the Vice President on 

January 8, 1999, USDA will make about $50 million 

in direct cash payments to hog producers and increase 

funding by $80 million for the hog pseudorabies 

eradication program.

Conservation

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1998 Annual Report of the Secretary/ ARP 1

effects of natural disasters, Secretary Glickman on July 26 

extended the same assistance to Oklahoma farmers and 

ranchers. 

● On August 5, Secretary Glickman declared the entire State 

of South Carolina a disaster area. By the beginning of 

August, CCC designated 143 counties in 11 States 

allowing eligible producers to hay and graze Conservation 

Reserve Program acreage in response to feed shortage 

conditions. 

● Touring agricultural damage near Sydney, Texas, August 

11, Secretary Glickman designated all or parts of Iowa, 

Montana, and Wyoming as disaster areas, making farmers 

and ranchers there eligible for low- interest economic 

emergency loans. 

Conservation Reserve Program

CCC has:

● Made the Conservation Reserve Program (CRP) more 

environmentally sensitive and sound. 

● Enrolled nearly 23 million acres of America’s most 

environmentally sensitive lands for protection in the 

CRP, freeing up millions of acres of cropland to be put 

back into production. 

● Broadened the Conservation Reserve Enhancement 

Program (CREP) using State and Federal resources to 

help solve environmental problems. This program 

provides a framework for CCC to work in partnership 

with States and local interests to meet State-specific 

environmental objectives. CREP proposals have 

already been approved in Maryland, Minnesota, 

Illinois, New York, Oregon, and Washington.

Food Relief Efforts and Food Security

● Continued to expedite shipment of food in response to natural disasters and economic hardship. FSA assisted in 

providing over 900,000 pounds of food to victims of Hurricane Georges in Puerto Rico. 

● Worked closely with the Agency for International Development (AID) to advance purchase a variety of commodities 

used under the provisions of Public Law 83-480 for food assistance overseas and store the products at a U.S. port for 

use in emergency situations. Over 37,000 metric tons of product were handled throughout the year. 

● Undertook special efforts to respond to several world emergency food situations. About 200,000 metric tons of 

assorted food were purchased and delivered to North Korea through the World Food Program. In response to the 

crises in Indonesia, CCC purchased nearly 60,000 metric tons of food. This fall, the emergency appeal for the 

Balkans region which includes Serbia and Kosovo resulted in the emergency purchase of 15,000 metric tons of wheat 

flour. 

Conservation Reserve Enhancement Program

On August 26, Secretary Glickman announced $10.4 million in 

CCC funding for the New York City Watershed Conservation 

Reserve Enhancement Program (CREP), a Federal-State initiative 

to protect New York City’s drinking water.

President’s Food Aid Initiative

In July, President Clinton announced a Food Aid Initiative 

under which surplus commodities that were removed from 

the domestic market by CCC were disposed of through 

donations.

This activity included:

● The purchase of 1.26 million metric tons (MT) of wheat which will be donated through various food aid programs. 

● Preparations to purchase another 3.74 million MT to meet the President’s goal of removing 5.0 million MT of wheat 

from domestic markets. 

Food Recovery

● In the fall of 1997, USDA hosted the first National Food Recovery and Gleaning Summit to bring together public 

interest groups, the private sector, farmers, and others to discuss hunger and food recovery. Summit participants set a 

national goal of increasing food recovery by 33 percent. As a result of the summit, FSA has initiated gleaning 

activities in at least 26 States. Crops gleaned include apricots, apples, blueberries, cabbage, cantaloupe, celery, 

cherries, sweet corn, cucumbers, grapefruit, green beans, melons, peaches, peas, peppers, potatoes, squash, 

strawberries, sweet potatoes, tomatoes, and wheat. 

● At least 14 new farmers markets were opened in at least 9 States.

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Voice for Freer World Trade

On January 7, 1998, Secretary Glickman addressed the Oxford 

Farming Conference in Oxford, England. He reported on the status 

of the U.S. agricultural policy and discussed a number of other 

critical trade matters, including food safety standards based on 

sound science. He advocated moving world agricultural trade 

toward a “more open, free and fair global marketplace.” 

Civil Rights

● Trained 25,581 FSA employees (97 percent of total) 

on the Introduction to Civil Rights. 

● Developed a new system to process program 

complaints using a centralized factfinding office 

located in Montgomery, Alabama, which reports 

directly to FSA’s Office of Civil Rights and Small Business Utilization Staff (CR&SBUS). Now, cases are 

independently reviewed in the field and analyzed by the headquarters CR&SBUS within an average of 47 days. 

Foreign Agricultural Service 

Mission

The mission of USDA’s Foreign Agricultural 

Service (FAS) is to serve U.S. agriculture’s 

international interests by expanding export 

opportunities for U.S. agricultural, fish, and forest 

products and by promoting world food security.

Export Initiative for North Dakota

The Foreign Agricultural Service, working with the North Dakota 

State Department of Agriculture and the Mid-America International 

Agri-Trade Council, led an outreach effort to stimulate North 

Dakota’s value-added agricultural exports and support efforts to 

generate additional economic activity in the depressed agricultural 

sector of the State. In June, FAS completed an outreach mailing of 

export assistance materials to more than 1,200 agricultural 

processors and wholesalers in the State, including more than 400 

grain establishments handling grain and soybean commodities.

USDA Goal: Expanding economic and trade 

opportunities for agricultural producers and other rural 

residents

In 1998, CCC made full use of its export credit guarantee 

programs to support U.S. exports; these programs were 

especially helpful in keeping U.S. products flowing to the 

troubled markets of South Korea and Southeast Asia. For FY 

1998, CCC announced the availability of nearly $5.8 billion 

in GSM-102 credit guarantees, compared with $3.96 billion 

in 1997. In FY 1998, export credit guarantee programs facilitated the sale of over $4 billion in U.S. agricultural products. 

Secretary Glickman reactivated the Export Enhancement Program (EEP) to partly compensate U.S. poultry producers for 

markets lost in Europe. He also announced an EEP initiative for barley in response to the European Union’s heavily 

subsidized sale of barley into the U.S. market. Under the Dairy Export Incentive Program, Secretary Glickman has 

authorized export bonuses up to the maximum volume and spending limits consistent with our World Trade Organization 

(WTO) obligations. 

USDA worked successfully to open, expand, and maintain markets for U.S. agriculture. In February, the United States and 

Taiwan signed a market access agreement that has Taiwan lifting its import bans and allowing access for U.S. pork, poultry, 

and variety meats. Upon Taiwan’s accession to the WTO, Taiwan will cut tariffs and open tariff-rate quotas on a range of 

agricultural products. In May, the WTO ruled that the European Union must bring its ban on meat from animals treated with 

growth-promoting hormones into compliance with the WTO panel and appellate body rulings by May 13, 1999. USDA is 

working to address issues and ensure support for the safe use and trade of agricultural biotechnology products. USDA is 

working bilaterally with key trading partners such as Argentina, Chile, Japan, and Canada, as well as multilaterally through 

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Program Development Division, Export Credits Program Area 

Five employees in the FAS Export Credits area partnered with five 

private voluntary organizations to streamline the funding process to 

private organizations for humanitarian food distribution. This team 

is a great example of reinvention, and it won Vice President Gore’s 

Hammer Award. They cut cycle time from 41 to 7 business days, 

cut hands-off from 10 to 5 people, cut administrative costs by 

almost $1 million in 1 year, and increased U.S. commodities 

purchased and food distribution by 28 percent.

organizations such as the Asia Pacific Economic Cooperation 

(APEC) forum. 

The U.S. Government continues to implement two major 

trade agreements–the Uruguay Round Agreement on 

Agriculture and the North American Free Trade Agreement 

(NAFTA)–as well as numerous bilateral agreements to open 

markets for U.S. agricultural products. U.S. exports to our 

two NAFTA partners–Canada and Mexico–continue to be a 

bright spot in the export picture. Exports to those two 

countries were expected to account for 24 percent of total U.S. agricultural exports in FY 1998.

Risk Management Efforts for Socially Disadvantaged Farmers

On March 24, USDA Risk Management Agency staff participated 

in a Risk Management Education Work Group with a community 

college and North Carolina Extension staff to design outreach 

activities directed to agribusiness and farmers, especially limitedresource and socially disadvantaged farmers, in an eight-county 

area in the Kenansville, North Carolina, area. Also on March 24-25, 

RMA staff attended the Native American Federal Resources Forum 

in Helena, Montana, showcasing how USDA’s programs can serve 

American Indians. 

Training under the Cochran Fellowship Program can have many 

positive impacts. For example, in 1993, You Xim Sun was the 

assistant manager of the Shanghai No. 1 Provisions Store–a store 

owned by the Chinese government. While participating in the 

Cochran Fellowship Program, he learned about the possibilities of 

an open distribution system in a market economy. With this vision 

of the future in China, he left his job with the state-owned 

company and set up his own business. He now runs a successful 

company that imports food ingredients from the United States and 

other countries. 

Glenzie Kazi of South Africa participated in a horticultural training 

program under the Cochran Fellowship Program in 1996. After 

returning to South Africa, Ms. Kazi took over her father’s nursery 

business. With ideas she had learned in the United States, she bid 

for and won three large landscaping contracts. She hired 12 new 

employees and is training four students from the local agricultural 

school. 

 

To foster better agricultural trade and development cooperation, USDA is participating in bi-national commissions with key 

countries such as Argentina, Chile, Russia, South Africa, and Ukraine. This participation ensures that agricultural issues are 

represented in discussions with these key trading partners.

Since 1984, USDA’s Cochran Fellowship Program has provided U.S.-based training for over 6,060 international participants 

from 56 countries worldwid--middle-income countries, emerging markets, and emerging democracies. Training 

opportunities are for senior- and mid-level specialists and administrators from the public and private sectors who are 

concerned with agricultural trade, agribusiness development, management, policy, marketing, and technology transfer. In FY 

1998, 567 Cochran fellows from 48 countries received training in the United States.

In 1998, FAS teamed up with the National FFA organization and the United Negro College Fund to provide college students 

with opportunities to work at agricultural offices in U.S. embassies overseas for up to 3 months. In 1998, FAS offices in 

Argentina, Austria, Belgium, China, Morocco, Poland, Singapore, South Korea, Spain, Taiwan, and Venezuela participated 

in the program, providing training and work experience to 15 college students interested in careers in international 

agricultural trade and related industries. 

On August 5, the U.S. embassy in Nairobi, Kenya, was destroyed by a terrorist bomb. A Kenyan citizen working for the FAS 

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office was killed by the bomb blast, and three other FAS employees were injured. Newly enacted legislation will provide 

compensation to the hundreds of Kenyans who were injured and the families of those who were killed. In addition, USDA 

employees established a fund to help the victims of this tragedy.

Funding Risk Management Initiatives for Minority Farmers 

On June 26, USDA awarded an $85,000 grant to the Salinas, 

California, Rural Development Center to improve the risk 

management skills of more than 300 Latino family farmers. And on 

June 27, USDA awarded a $60,000 grant to develop a risk 

management education program to benefit Hmong and other 

Southeast Asian farmers as they begin farming careers near Fresno, 

California.

USDA Goal: Ensuring food for the hungry, and a safe, 

affordable, nutritious, and accessible food supply

The United States continues its strong commitment to the 

World Food Summit goal of reducing the number of 

undernourished people by half by the year 2015. The U.S. 

action plan, which will outline U.S. proposals to reduce 

hunger both in the United States and around the world, will 

be issued in early 1999.

In FY 1998, the United States provided about 3.5 million tons of food aid to needy countries. (Programs under which food 

aid is provided are: Titles I, II, and III of Public Law 480, the Food for Progress Program, and Section 416(b).) In addition to

the food aid provided under these authorities, President Clinton in July announced a new Food Aid Initiative which is 

expected to provide 5.0 million metric tons of wheat and wheat products once fully implemented. The initial 2.5 million 

metric tons were allocated within 3 months.

USDA Goal: Effective customer service and efficient program delivery

FAS opened an office at the U.S.-Mexican border to help identify and resolve border trade issues that impede U.S. 

agricultural exports. The office, located in Nuevo Laredo, Mexico, also conducts outreach activities into border communities 

in the United States and Mexico to explain USDA trade programs. U.S. exporters sold more than $5 billion worth of 

agricultural products to Mexico in 1998, making Mexico our third largest export market. 

FAS also opened two new regional export assistance centers in 1998 in Atlanta, Georgia, and Sacramento, California. These 

offices are developing partnerships with key groups such as State departments of agriculture, universities, trade and 

economic development groups, State and local governments, regional trade centers, and food industry and farm 

organizations to alert them to overseas opportunities and sources of private and public export assistance. FAS also has export 

assistance offices in Des Moines, Iowa, and Portland, Oregon.

Risk Management Agency

Mission

The Risk Management Agency will provide and support cost-effective means of managing risk for agricultural producers in 

order to improve the economic stability of agriculture.

In April 1998, Secretary Glickman announced steps that USDA would take to improve the safety net for U.S. farmers, 

including measures to improve the crop insurance program. During the year, the Risk Management Agency (RMA) began or 

accomplished these initiatives: (1) expanded crop insurance to new crops and new areas (ongoing); (2) suspended the 

controversial Nonstandard Underwriting Classification System (effective 1999); (3) revised prevented planting provisions 

(effective 1999); (4) made coverage available more quickly (ongoing); and (5) developed new pilot programs providing 

producers with increased coverage (effective 1999). 

RMA is committed to helping producers find efficient and affordable means of managing risk in order to improve the 

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economic stability of agriculture. In 1998, the agency implemented new pilot programs for sweet potatoes, pecans, and 

avocado and mango trees, and approved pilot programs for watermelon, rangeland, wild rice, cherry, cabbage, winter squash, 

mustard, and crambe for the 1999 crop year. RMA also developed an innovative new revenue policy, raised coverage levels 

to 85 percent for various policies, revised its current nursery program, and made critical changes to several other existing 

crop policies. 

USDA Expands Crop Insurance Protection 

On May 8, the Federal Crop Insurance Corporation Board of 

Directors voted unanimously to authorize a pilot crop insurance 

program to increase coverage from 75 percent to up to 85 percent 

of a farmer’s individual yield; to expand the income protection pilot 

plan for wheat to include all of Montana, Oregon, South Dakota, 

and Washing-ton; to expand the group Risk Plan crop insurance 

pilot to test rangeland in 12 Montana counties; to approve a new 

pilot program for avocado fruit in Dade County, Florida; and to 

make several improvements to the Crop Revenue Coverage for 

wheat. 

“The two biggest improvements are the ease of starting up and 

getting into the nursery insurance program, and the fact it adds. . . 

about 40 percent of the plant material grown in Oregon that was 

previously uninsurable. That is probably the biggest thing.” —Tom 

Fessler of Woodburn Nursery and Azaleas Incorporated and past 

president of the Oregon Association of Nurserymen 

“Crop insurance has been our salvation. . . . If it had not been for 

crop insurance after the devastating losses in 1994 and 1996, we 

would not have been able to continue.”—Georgia producer Duke 

Lane, Jr., owner of the second largest peach operation in the United 

States

Without crop insurance protection to help survive the effects of El 

Niño, third-generation peach farmer Lewis Holmes says, “I would 

have had to fold my tent. . . . I am willing to work with the local 

office in Valdosta, Georgia, and Washington officials to help forge 

a better risk management program to benefit all farmers. We need 

to protect American farmers so that they can provide our great 

country with the food and fiber that our people so richly deserve.” 

—Lewis F. Holmes, III, member of the Board of Directors of the 

South Carolina Peach Council

“The Cherry Pilot Crop Insurance program is providing a risk 

management tool to cherry growers that has never been available 

before . . . . The pilot could not have been approved at a better 

time.” —Nora Baldwin, owner of Homestead Orchards in 

Washington State 

Response to Farm Crisis 

RMA responded decisively to the distress of farmers affected 

by declining prices and the catastrophic effects of several 

years of disastrous weather, including those resulting from El 

Niño. In the South and West, deviations were approved in the 

standard loss adjustment procedure for cotton farmers 

suffering from drought. In the Northwest and Northern 

Plains, the following changes were approved for the 1999 

crop year: (1) new options to existing programs were added 

to counteract the effects of multiple years of losses, (2) 

Income Protection for barley was expanded to several States, 

(3) crambe and mustard crop insurance programs were 

developed for 18 North Dakota counties, and (4) current 

programs were expanded, including canola for North Dakota 

and Revenue Assurance for corn and soybeans in Illinois, 

Minnesota, and South Dakota. Recommendations were 

solicited for the development of a pilot program to better 

protect growers from losses due to wheat scab. In addition to 

these mostly long-term measures, RMA will pay hard-hit 

producers an estimated $1.7+ billion in claims for 1998 

losses, including over $556 million in Texas, $96.6 million in 

North Dakota, $114.7 million in Georgia, $95.1 million in 

California, and $78.9 million in Minnesota. 

Agricultural Research Bill

On June 3, President Clinton signed the Agricultural 

Research, Extension, and Education Reform Act of 1998, 

Public Law 105-185, sending a message to producers that the 

Administration was committed to stabilizing and 

strengthening the crop insurance program. The Act ensured 

the stability of the program by meeting budget targets and 

providing permanent funding from (1) offsets from the food 

stamp administration surplus, (2) decreased compensation to 

insurance companies, and (3) increased producer fees. 

Risk Management Education

The Risk Management Education (RME) initiative was 

established by Secretary Glickman in 1997 to foster 

partnerships between the private and public sector that would 

lead to the creation of a comprehensive RME program. In 

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1998, Secretary Glickman awarded $3 million in grants to 17 

of the 107 applicants who responded to the call for proposals. RMA, the lead government agency, also conducted more than 

a dozen State and regional conferences to “train the trainers.” 

Dairy Options Pilot Program

On June 8, 1998, Secretary Glickman launched the $11 million options pilot program for dairy producers, observing that 

“with this innovative program, CCC will build on its efforts to help farmers—both large and small—to manage risk.” The 

first RMA program to use futures markets as a risk management tool, the pilot project allows farmers to offset their losses 

when milk prices fall, based on projected future earnings. 

New Revenue Insurance Policies 

In September 1998, the Secretary announced the approval of the Adjusted Gross Revenue (AGR) pilot program, observing 

that “If this experiment succeeds, we will be closer to the day when we can cover all crops.” The AGR policy will insure a 

percentage of multiple commodities under one policy, and base coverage on an adjusted 5-year average of gross income 

reported by the farmer on Schedule F of his or her tax return. 

Expansion of Covered Crops

For the 1998 crop year, RMA expanded 28 current crop programs into an additional 187 counties. This expansion added to 

the staggering national total of 28,154 county crop programs in 2,983 counties. In 1999, expansions will include canola, 

blueberries, income protection for barley, crop revenue coverage (CRC) for rice, and revenue assurance for corn and 

soybeans. CRC coverage will also be available for corn, cotton, grain sorghum, and soybeans in Florida and Maryland 

counties where the crop is already insured under a standard crop insurance policy. 

back to 

:

Content page to: Publications

News and Information

USDA home page

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FY 1998 Annual Report of the Secretary of Agriculture

USDA: Preparing for a New Millennium 

black line

2. Providing Tools for Wise Stewardship of the Land

USDA’s Natural Resources and Environment mission area plays a vital role in the management and conservation of the 

Nation’s land, natural resources, and natural heritage. USDA’s Forest Service and the Natural Resources Conservation 

Service share responsibility for fostering sound stewardship on 75 percent of the country’s total land area. 

The Forest Service mission is to sustain the health, productivity, and diversity of the land to meet the needs of present and 

future generations. The Forest Service carries out its mission in several ways: through wise care and stewardship of national 

forests and grasslands; through cutting-edge research programs which promote conservation, recycling, and new 

technologies that support ecologically sustainable development; and through State and private forestry programs which help 

deliver the benefits of conservation to hundreds of communities and States across the Nation. 

The Forest Service manages 191.6 million acres of public lands, made up of 155 national forests and 20 national grasslands 

in 44 States, Puerto Rico, and the Virgin Islands. The Forest Service challenge on the eve of the 21st century is to manage 

the people’s forests and grasslands through a new natural resource agenda with health of the land as the primary objective. 

Improvements to Conservation Reserve Program

On January 29, Secretary Glickman announced results of the 16th 

signup for CCC Conservation Reserve Program (CRP), bringing 

5.9 million environmentally sensitive acres into the program, 

greatly increasing the conservation value of the program.

The Natural Resources Conservation Service (NRCS) 

mission, “to provide leadership and administer programs to 

help people conserve, improve, and sustain our natural 

resources and environment,” provides the foundation for the 

conservation leadership role it has earned. For 6 decades, 

NRCS has worked side by side with landowners, conservation districts, State and local governments, and urban and rural 

partners to restore and enhance the American landscape. The agency provides direct technical assistance and conducts a 

broad range of programs to address farmers’ and ranchers’ natural resource concerns on millions of acres of private lands. 

Although the programs of these agencies differ, both are defined by profound land and service ethics which guide their 

common mission: to promote diverse, healthy, and sustainable ecosystems by restoring and sustaining the integrity of soil, 

air, water, biological diversity, and ecological processes. By making resource management decisions in the context of the 

full system, the agencies ensure that products, values, services, and uses desired by people are produced in ways that sustain 

a healthy and productive Nation and environment. 

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Forest Service

Sustaining Our Natural Resource Legacy

As the Forest Service enters its second century, it is advancing a 

strong, broad-based natural resource agenda that sets clear 

priorities for its scientists and managers, holding them 

accountable to the American people for sustaining the health of 

the land. 

In support of the agenda, the Forest Service is focusing special 

attention on four areas: Watershed health and restoration; 

Sustainable forest management; National forest roads; and 

Recreation.

In autumn 1998, the Forest Service released Charting our Future: 

A Nation’s Natural Resource Legacy, a publication that presents 

a conservation vision for public lands in the 21st century. It is a 

call to action, both for Forest Service employees and for the many organizations and people who depend upon and care for 

the national forests and grasslands. 

Making a Difference on the Ground

In 1998 Forest Service Chief Mike Dombeck awarded more than 100 natural resource agenda grants worth more than $2 

million to a wide array of projects that included community forestry, outreach to urban communities, interpretation and 

education, noxious weed eradication, watershed and road rehabilitation, wildlife and fisheries projects, forest management, 

research on assessing harvest methods, forest stress, watershed restoration, sustainability, and more. The grants were 

awarded to National Forests, Research, and State and Private Forestry programs. 

Community-Based Ecosystem Restoration Team–10 Federal 

Agencies and State of Oregon Share Hammer Award

The Governor of Oregon and 10 Federal agencies signed a 

Memorandum of Understanding committing to a common vision 

and strategy focusing on the goal of healthy ecosystems rather than 

the means and processes to achieve it. This has empowered and 

encouraged local community-based, watershed council efforts to 

develop and implement ecosystem plans that address all lands and 

issues in the watershed. The Federal agencies involved are Forest 

Service, Natural Resources Conservation Service, Fish and Wildlife 

Service, Bureau of Indian Affairs, Bureau of Reclamation, National 

Park Service, National Marine Fisheries Service, Bureau of Land 

Management, Environmental Protection Agency, and the U.S. 

Army Corps of Engineers.

Working Together 

The Sustainability Roundtable made up of over 30 leaders of 

Federal agencies and State, county, tribal, and 

nongovernmental organizations (including environmental, 

industry, landowner, and community groups and professional 

societies) was formed in 1998. The Roundtable was brought 

together by Secretary Dan Glickman and Forest Service Chief 

Mike Dombeck to help realize the President’s commitment to 

achieve sustainable forest management by the turn of the 

century. The overall goal of the Roundtable is to bring people 

together to foster common goals for sustainable forests and 

grasslands.

A Southwest Strategy for Natural Resource Conservation and Community Development

The Forest Service, along with other Federal agencies in Arizona and New Mexico, is working with local communities on a 

natural resource conservation and community development strategy. This is a collaborative effort to seek solutions to 

difficult issues such as adjustments to grazing permits, protection of endangered species, and protection and use of water 

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resources. Awareness of the Southwest Strategy approach continues to spread as a potential model to resolve tough local and 

regional issues for public land management in the Southwest. 

Communities Reinvent Government To Protect and Use Public Lands 

In 1998, Under Secretary James Lyons presented representatives of the Diablo Trust with a National Reinvention Laboratory 

Certificate. Signed by Forest Service Chief Mike Dombeck and Vice President Al Gore, the certificate establishes the Diablo 

Trust as a National Reinvention Laboratory. Reinvention laboratories are innovative organizations or activities established to 

test or prototype new reinventing government initiatives. The Diablo Trust is the result of 5 years of effort by ranchers, 

environmentalists, the Hopi Tribe, Federal and State agencies, college faculty, and others in the Flagstaff, Arizona, area to 

keep the area’s hallmark large-scale landscapes intact. It is the first Reinvention Laboratory focused on ranching and 

landscape-scale opportunities. The Diablo Trust encompasses 500,000 acres including private lands and a portion of the 

Coconino National Forest (AZ). 

Team Oregon Conservation Partnership Wins Hammer Award

The Natural Resources Conservation Service in Oregon, with 

assistance from Oregon’s Association of Conservation Districts and 

the Oregon Department of Agriculture, reorganized the traditional 

line-and-staff structure into eight watershed basin groups. Because 

of the unique partnership and the streamlined way of conducting 

business, the Oregon Conservation Partnership has been able to use 

many existing and emerging conservation opportunities, including 

salmon restoration activities, water quality implementation, Farm 

Bill implementation and locally identified issues. This has saved 

taxpayers time, money, and frustration from bureaucratic 

duplication.

Recreationists Have New Resources

In 1998, the Forest Service joined with six other Federal 

agencies under the National Partnership for Reinventing 

Government to create www.recreation.gov, a new interagency 

Internet website and search engine that allows users to 

quickly and easily locate recreation opportunities on Federal 

lands. Also in 1998, the Forest Service expanded the 

opportunity for recreationists to reserve space at recreation 

sites nationwide through a toll-free number, providing a “onestop” reservation service. 

Clean Water Act Turns 25 

The Federal Water Pollution Control Act, commonly known as the Clean Water Act, marked its 25-year anniversary in FY 

1998. Nearly 80 percent of the Nation’s freshwater sources originate on national forest land. In February 1998, President 

Clinton and Vice President Gore announced a new strategy for addressing water problems across the country in a Clean 

Water Action Plan. Developed under the leadership of USDA and the Environmental Protection Agency, the plan focuses 

on: greater Federal, State, and local integration through a watershed approach; connection between water quality and natural 

resource programs; accelerating watershed and ecosystem restoration; and critical role of collaboration with communities 

and other local stakeholders. 

Turning Street Trees Into Sawlogs 

Utilizing City Trees, an award-winning publication by the Forest Service and New Jersey Forestry Services, inspired 

workshops on the same theme in 1998. The publication and workshops educate and train personnel from tree service 

companies, lumber manufacturers, municipalities, and State agencies on how to merchandise sawmill-size logs from trees 

removed from city streets. The strategy turns urban wood waste, a potential cost burden, into an income-producing 

opportunity. Urban wood recycling efforts are a part of the Forest Service’s emphasis on urban and community forestry. 

Improving the Urban Environment in the Nation’s Capital

On February 3, 1998, Secretary Dan Glickman joined USDA’s Forest Service; Natural Resources Conservation Service; 

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Hammer Award to Columbia Gorge Discovery Center 

Usually the Forest Service plans, develops, constructs, operates, 

and maintains its interpretive centers. When it came time to plan 

the Columbia River Columbia Gorge Discovery Center in Oregon, 

the Forest Service entered into a unique partnership with the local 

government and citizens. A five-member group became the overall 

responsible governing body of this facility and worked to jointly 

construct the Discovery Center with the Wasco County Museum. 

This is a private/nonprofit/ Federal project owned and operated by 

the private/nonprofit group. The Forest Service serves as a member, 

not as the controlling organization. This resulted in significant cost 

savings to government in the construction phase and will result in 

reduced long-term operation costs. The Forest Service is providing 

service to the public which features the strengths of the private 

sector, the support of a community regional nonprofit entity, and 

the professional capabilities of the Forest Service.

Agricultural Research Service; and Cooperative State 

Research, Education, and Extension Service; and District of 

Columbia Government officials to recognize community 

organizations that will share $250,000 of Federal Challenge 

Cost-Share funds. Twelve groups received funds ranging 

from $5,098 to $50,000 to use in implementing Urban 

Environmental Resource Initiative projects as part of USDA’s 

Plan of Action for the District of Columbia. The Urban 

Environmental Resource Initiative helps local groups 

improve their environment through volunteerism and 

community support. This project is part of the President’s 

Initiative to assist the District of Columbia in improving the 

health and beauty of its urban environment. 

Sustaining Forests Globally 

In 1998, Forest Service Chief Mike Dombeck reviewed collaborative programs in Negev, Jerusalem, and the northern 

Galilee region in Israel. The Forest Service and the Keren Kayemeth LeIsrael World, the land management counterpart in 

Israel, have been working together on arid and semi-arid afforestation (planting trees where they have not grown before) and 

watershed management for over 10 years, during which time over 50 technical exchanges involving more than 100 

professionals have occurred. The Forest Service is the principal sponsor of the International Arid Land Consortium that 

researches, develops, and performs demonstration projects in arid lands management. 

Serving All People

In 1998, the Forest Service joined with the Bureau of Land Management, the 

National Park Service, the Bureau of Reclamation, the Army Corps of 

Engineers, and the Fish and Wildlife Service to improve our ability to serve all 

of our publics. We joined in an agreement with a nonprofit organization, 

Wilderness Inquiry, to further the goals of dignity, independence, and social 

integration in the outdoor recreation environment. Wilderness Inquiry, based in 

Minneapolis, Minnesota, has been providing recreation and wilderness 

opportunities for people from diverse backgrounds, including those with 

disabilities, urban at-risk populations, and single-parent families, for more than 20 years. Services include training, outreach, 

and development of information. Trips are also available for those who may not be able to experience natural settings on 

their own. 

Help for Flooded Areas

In June and July, USDA approved $18.9 million for Colorado, New 

York, Maine, California, South Dakota, Oklahoma, Ohio, Arizona, 

Alabama, New Hampshire, Vermont, Wisconsin, Mississippi, 

Minnesota, Indiana, Georgia, and West Virginia, to finance clearing 

debris from clogged waterways, restoring vegetation, and 

stabilizing flood-damaged river banks.

Forestry Is for Farmers Too

The Forest Service built a partnership in 1998 with the 

National Black Farmers Association and the USDA Coalition 

of Minority Employees. The agency is helping its new 

partners become better informed on landowner assistance 

programs available through State forestry organizations, and 

the partners are helping the Forest Service identify interested landowners with limited resources who have been underserved 

in the past. The Forest Service’s Southern Region plays an important role in reaching out to landowners in the South, where 

additional program services are especially needed. 

Natural Resources Conservation Service

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Backyard Campaign Brings Conservation Close to Home

Thanks to the Backyard Conservation Campaign, people across the Nation are discovering that healthier natural resources 

can start very close to home. Unveiled by Secretary Glickman on Earth Day, April 22, 1998, the campaign continues to 

generate an avalanche of interest. So far, nearly 300,000 copies of the Backyard Conservation booklet have been distributed, 

and more than 30,000 requests for campaign information packet have been received. Local and national media interest 

continues to grow. Free air time is valued at more than $800,000 for the campaign’s television public service announcement, 

and more than $250,000 for the radio announcement. The campaign has brought a 600-percent increase in recruitment for 

the Natural Resources Conservation Service’s Earth Team Volunteer Program. The Backyard Conservation Campaign is a 

cooperative project of NRCS, the National Association of Conservation Districts, and the Wildlife Habitat Council.

Backyard Conservation Campaign Video a Healthy Influence 

at Hospital

A video produced for the Backyard Conservation Campaign is 

bringing brighter days and bright ideas to patients and visitors at St. 

Vincent Hospital in Indianapolis, Indiana. The hospital’s media 

services staff broadcasts the 9-minute tape 12 times every day over 

the hospital’s patient channel. The staff reports that patients and 

visitors are comforted by the video’s positive message and 

entertained by its colorful images. The hospital averages 700 

patients at a time, with hundreds of visitors each day. That’s 

healthy exposure for backyard conservation.

Secretary Glickman Announces 25 New RC&D Areas

In March, Agriculture Secretary Dan Glickman announced 

that 25 areas in 18 States became eligible for USDA’s 

Resource Conservation and Development (RC&D) Program. 

The addition brings the total of RC&D areas to 315. RC&D, 

which is administered by NRCS, offers USDA technical and 

financial assistance for conservation and water management 

projects and expansion of economic, cultural, and recreational 

opportunities. Secretary Glickman also announced the 

expansion of six existing RC&D areas.

NRCS Helps Farmers in Guam “Go on the Record”

NRCS reports that some limited-resource farmers in Guam have difficulties receiving Environmental Quality Incentives 

Program (EQIP) benefits because recordkeeping is not part of their culture. To turn this situation around, NRCS entered into 

an EQIP educational assistance contract with the University of Guam, which includes workshops and one-on-one assistance 

on recordkeeping. This action has increased the effectiveness of EQIP.

NRCS Responds to Water Emergency in Pohnpei

The NRCS’ Pacific Basin office reports that a drought caused by El Niño forced the declaration of a water shortage 

emergency in the Federated States of Micronesia. Governor Del S. Pangelinon called for the protection of streams and 

underground water sources from animal and human wastes and nonbiodegradable products. In response to the declaration, 

NRCS conservationists translated water management information materials into local languages. NRCS also advised people 

on proper waste disposal and the need to boil drinking water to prevent hepatitis and other diseases.

NRCS, Partners Assist Drought-Affected Farmers

In Central Texas, NRCS and the Texas Department of Agriculture held workshops with farmers and ranchers to provide 

them with information about how USDA can help them cope with drought conditions. Workshop topics included planting 

and managing winter pastures, selling cattle and buying hay, farm programs, and emergency loans. NRCS in the Dallas/Fort 

Worth area advised the public about how drought increases the possibilities and dangers of wildfire. 

EQIP-Funded Effort Reducing Soil Erosion, Fertilizer Use

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Elkhorn Slough Watershed Project Team Wins Hammer 

Award

Elkhorn Slough Watershed Project Team in California worked 

cooperatively with local Hispanic growers to develop and apply 

innovative conservation technologies and delivery methods adapted 

to the growers’ cultural and economic differences. An average of 

33 tons of soil per acre was lost from the fields each year, and as 

much as 145 tons per acre were lost during wet years. The 

pesticides in this soil are likely responsible for the water quality 

problems in the Elkhorn Slough National Estuarine Reserve. A 

technical assistance team worked with the local Hispanic growers 

to find the common ground between their needs and cultural issues 

and the natural resource objectives of the local Resource 

Conservation District and the Natural Resources Conservation 

Service.

With funding from EQIP, the city of Syracuse, New York, is 

improving water quality in the Skaneateles Lake Watershed. 

Farmers are developing nutrient management plans that 

include conservation buffers and minimize nutrient use. 

Eighty percent of the farms—48 out of 60—are participating 

in the effort. These farms hold more than 90 percent of the 

agricultural land in the watershed. On 16 farms, the annual 

rate of erosion has been reduced by more than 2,000 tons. 

Fourteen farms have saved an average of $1,000 in fertilizer 

costs. On 11 farms, livestock no longer have access to 

waterways.

NRCS, Partners Add Practices, Personnel To Protect 

Neuse River

NRCS and the North Carolina Division of Soil and Water Conservation accelerated the establishment of best management 

practices that address the pollution problems of the Neuse River, the waterway in which the bacteria Pfiesteria was 

discovered. NRCS added two positions and is sharing the cost of 10 district positions.

Wood Products End Use Team Wins Hammer Award

The last major end use survey of wood products conducted by the 

Forest Service alone took two Forest Service researchers and many 

student assistants more than 3 years to complete and cost well over 

$100,000. Today the Forest Service, the Engineered Wood 

Association, and the Wood Products Promotion Council work 

together to find out how people are using solid wood products. The 

surveys are directed and conducted by industry, with the Forest 

Service giving general advice on survey design and helping to 

analyze data. In the last 8 years, this unique collaboration has saved 

taxpayers more than $400,000.

NRCS Accelerates Outreach to Native Americans 

NRCS continues its commitment to increasing its services to 

Native Americans. The following are examples of this 

outreach:

 Colorado: NRCS assigned two tribal outreach specialists to 

work with the Ute Mountain Ute and Southern Ute tribes. 

NRCS has offices at each tribe’s headquarters and works 

directly with producers and the tribes’ agricultural and natural 

resources departments.

 Montana: NRCS held meetings to provide tribal representatives with overviews of USDA programs, the NRCS planning 

process, and the roles of tribal representatives on the State Technical Committee.

 South Dakota: NRCS gave the Standing Rock Tribal Conservation District an overview of assistance available from 

USDA. NRCS also developed a cultural resource agreement with the Tribal Historic Preservation Office to help members of 

the tribe plan conservation practices. 

 North Dakota: Eight listening forums sponsored by American Indian communities established a dialogue between USDA 

and the communities. 

 Arizona: Thanks to an unprecedented agreement with the Navajo Nation Historic Preservation Department, NRCS 

employees in Arizona are conducting archeological clearances prior to beginning conservation projects on some of the most 

culturally significant and well-preserved archeological sites in the world. 

 Wyoming: NRCS and the State’s Food and Agriculture Committee met with the Shoshone-Arapaho Joint Business 

Council to discuss services of the USDA Service Center and Department programs available to the Wind River Indian 

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Reservation.

 Minnesota: NRCS and the Fond du Lac Tribal and Community College in Cloquet established the Center of Excellence 

for Map Compilation. Students learn about soil science, soil surveys, aerial photo interpretation, remote-sensing 

fundamentals, and geographic information systems.

NRCS, Partners Restore Streambank Near Geriatric Center

In Upper Providence Township, NRCS in Pennsylvania and its State and local partners restored an 800-foot section of 

streambank along a tributary of the Schuykill River on property near a geriatric center. The NRCS-designed project protects 

the streambank from erosion, which in turn prevents silt from eroding into the tributary. Working with NRCS were volunteer 

environmentalists, county inmates in an early release work program, county park personnel, county planners, and workers 

from State and local conservation agencies.

Conservation Measures, NRCS Efforts, Prevent Flood Damage

Storms in southwest Iowa severely eroded nearly 350,000 acres of cropland. Despite these losses, NRCS reports that fields 

protected by agency-recommended practices such as no-till farming, contour buffer strips, grassed waterways, field borders, 

and terraces suffered minimal sheet and rill erosion. In the town of Hamburg, a restored wetland prevented flooding. In Iowa 

County, wetland areas restored through NRCS’ Emergency Watershed Protection (EWP) Program prevented the flooding of 

12,000 acres of cropland.

NRCS’ PLANTS Website Wins Awards From Media, Secretary 

Glickman

The NRCS’ PLANTS database on the World Wide Web received 

the Information Technology Award for Excellence from 

Government Computer News. The site also was named “Incredibly 

Useful Site of the Day” for July 7 by the MSNBC Network, which 

is owned by Microsoft and the National Broadcasting System. 

Secretary Glickman awarded the website the 52nd Annual 

Secretary’s 1998 Group Achievement Award commending its 

commitment to “one-stop shopping” and reinvention of 

government, and to addressing environmental concerns and 

providing high-quality natural resources information. PLANTS 

provides a single source of basic information about North American 

flora.

NRCS Funds Repair of Critical Access Road

Near Buffalo, Wyoming, an access road needed for 

emergency services and the livestock industry was repaired 

with nearly $240,000 in funds from EWP. State congressional 

delegates supported and assisted local people in finding 

funding for this project.

Hydrants Installed Through RC&D Program Cool Fire 

Insurance Costs

A study by NRCS of the RC&D Program in Louisiana found 

that fire protection measures installed through the program 

reduce rural homeowners’ fire insurance rates by approximately $137 per year. NRCS attributes the decrease to more than 

2,000 dry fire hydrants installed through the program. 

“SWAT” Team Protects Natural Resources

In Cobb County, Georgia, homeowners formed a “SWAT” team to prevent soil erosion and encourage the use of 

landscaping techniques that protect natural resources. “SWAT” is an acronym for “soil, water, air, and trees.” Team 

members must first join the NRCS Earth Team Volunteer Program to learn the basics of community conservation. NRCS 

Marietta Field Office provides the team with training and technical assistance. 

NRCS Office Excels, Earns Awards, Recognition From Secretary Glickman

For “performing its work with enthusiasm and competence far beyond most citizens’ expectations of a government agency,” 

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the Baldwin County NRCS office in Bay Minette, Alabama, was named Government Agency of the Year by the county’s 

Environmental Advisory Board. The board praised NRCS Baldwin County for helping schools develop and build wetland 

study areas and an outdoor learning center. The office also worked with local conservation groups to develop a flood 

protection plan for a 200-square-mile watershed. Secretary Glickman cited NRCS Baldwin County for demonstrating the 

effectiveness of locally led conservation efforts and for its commitment to “going the extra mile to serve its customers.”

NRCS, Partners Team Up To Teach Businesses About Woodland Erosion

A woodland erosion control curriculum developed and implemented by NRCS in Louisiana with Boise Cascade and the 

Louisiana Forestry Association will have positive impacts on more than 3 million acres of industrial forest land and nearly 9 

million acres of non-industrial forest land. NRCS reports that hundreds of contractors, loggers, foresters, and others have 

participated in education sessions based on the curriculum. Sponsors for these sessions include International Paper 

Company, Georgia Pacific, Weyerhauser, and Willamette Industries.

Virginians Off To See the “Wizard,” Thanks to NRCS, 

Partners

Visitors to the Virginia State Fair saw the first exhibition of the 

“Water Wizard,” a water quality education van. Donated by NRCS, 

the renovated cargo van contains watershed and groundwater 

models, videos, and interactive exhibits. The Chesapeake Bay 

Program, the State’s Department of Environmental Quality and 

Department of Conservation and Recreation, and Virginia’s Coastal 

Program fund the “Wizard.” To give the “Wizard” maximum 

exposure throughout the State, it is rotated among Virginia’s six 4-

H Club centers.

Demand Growing for NRCS Plant Materials in Garden 

State

In New Jersey, demands for NRCS plant materials are 

exceeding supplies. To meet the demands, NRCS is reaching 

out to farmers to encourage them to grow conservation plants 

for commercial production. NRCS conservation plants and 

bioengineering assistance are protecting shorelines and 

preventing erosion along the Atlantic Ocean, bays and 

streambanks, and rivers and lakes.

New NRCS Information Series Shows “How-To’s” of Effective Customer Service 

The NRCS and its partners in conservation are working more effectively with people and communities, thanks to an 

information series produced by the agency’s Social Sciences Institute. The series features 11 publications that help NRCS 

and its partners communicate to their customers the benefits of conservation and how to deal with situations that can occur 

while doing customer service. Copies of the publications were distributed to all NRCS State and field offices and are 

available on NRCS’ home page on the World Wide Web.

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FY 1998 Annual Report of the Secretary of Agriculture

USDA: Preparing for a New Millennium 

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3. Feeding More Children and Families

Food and Nutrition Service

Mission 

The Food and Nutrition Service (FNS) reduces hunger and food insecurity in partnership with cooperating organizations by 

providing children and needy families access to food, a healthful diet, and nutrition education in a manner that supports 

American agriculture and inspires public confidence.

Millions of Americans Receive Nutrition Benefits Through FNS Programs

Sheer numbers attest to the impact of FNS programs on people: In FY 1998, about 

$17 billion in food benefits was provided to an average of nearly 20 million people 

each month through the Food Stamp Program (FSP); more than 5 billion (yes, 

billion) nutritious meals were served by the National School Lunch and School 

Breakfast Programs to more than 27 million children each day, over 60 percent of 

them free or at reduced price; and more than $2 billion in nutritious supplemental 

food was provided to 7.4 million women, infants, and children every month 

through the Special Supplemental Nutrition Program for Women, Infants, and 

Children (WIC).

Passage of the WIC-Child Nutrition Reauthorization Legislation, Public Law 

105-336

The passage of Public Law 105-336 represents the most significant expansion of 

child nutrition programs in decades, and the first reauthorization legislation 

proposed by the Executive Branch in more than 20 years. Signed by President 

Clinton on October 31, 1998, Public Law 105-336 expands children’s access to 

nutrition assistance and improves program operation, management, integrity, and 

safety. Public Law 105-336 will allow youths aged 13 to 18 to receive nutritious snacks in after-school care programs, 

providing a strong incentive to draw low-income, at-risk youths into safe, constructive after-school activities. Expansion of 

availability of nutritious meals and snacks to older children is expected to draw 1 million children a day into after-school 

programs.

Outreach for Children’s Health Insurance

By a simple check-off on their applications for free and reduced-price school meals, low-income parents will be able to 

receive information about health benefits through Medicaid or CHIP–the Children’s Health Insurance Program–created 

under the Balanced Budget Act of 1997. More than 15 million children in the United States qualify for free or reduced-price 

meals through the school programs. Many of those children are also eligible for one of the insurance programs. The 

insurance check-off is meant to reach parents of the 10 million American children who currently are not covered, including 

4.7 million who are eligible for Medicaid but are not enrolled.

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USDA Helps Storm Victims

Following the April 18, 1998, tornado that hit Birmingham, 

Alabama, USDA approved a modified food stamp program for 

Jefferson County, Alabama, providing assistance to individuals 

whose homes were destroyed or damaged.

Gleaning Remains a Priority

FNS in July provided grants to 13 school districts around the 

country to help them find ways to increase their food 

donations to needy people. FNS also worked with the 

National Restaurant Association to publish a food recovery 

guide for restaurants, and coordinated efforts of other Federal 

agencies to facilitate food donations. All of these efforts contribute to USDA’s goal of increasing food recovery by 33 

percent.

Implementing Welfare Reform

FNS has been active on a number of fronts to help States implement the 1996 welfare reform law, and subsequent legislation 

that modified the 1996 law:

Some 225,000 immigrants who lost food stamp 

benefits under the welfare reform law had those 

benefits restored as of November 1 because of 

FNS’s work with the Administration on the 

agricultural research bill, which passed in May 

1998. FNS also developed guidance for States on 

implementation and bilingual informational 

material for immigrants. 

Prior to passage of the benefits restoration, FNS 

provided technical support for 13 States to establish 

State-funded food stamp programs to provide 

benefits to more than 170,000 of the most 

vulnerable of those who lost their Federal benefits. 

Improving Management of the Food Stamp 

Program

September 1998 marked a major milestone in the development of Electronic Benefit Transfer (EBT) nationwide: more than 

50 percent of all food stamp benefits issued are now issued through EBT systems. Today, 36 States and the District of 

Columbia are operating EBT systems, up from 25 a year ago. Twenty-nine of these States are now using EBT statewide, 

while only 16 were statewide at this time last year.

Food Recovery in Illinois

USDA officials in Illinois and the Illinois Council of Churches cohosted a gleaning and food recovery workshop June 26 in 

Springfield, Illinois, to help interested groups learn needed skills 

and share information. Topics included “How to start a gleaning or 

food recovery project,” “What works–what doesn’t,” and “Getting 

the community involved.” It also included sessions on farmers 

markets, transportation issues, and interstate partnership 

possibilities.

Continuing its commitment to fighting fraud, FNS 

implemented tough new integrity provisions for food stamp 

retailers, including pre-authorization screening, tougher postauthorization controls, and stiffer penalties for violators. 

During FY 1998, the Food Stamp Program investigated 5,178 

retailers, and fined or disqualified 1,201 for program 

violations. Of those, 719 retailers, with redemptions of $49.5 

million, were identified as having engaged in trafficking (the 

exchange of food stamps for cash). 

Continuing its series of “compliance sweeps,” the Food Stamp Program Compliance Branch in April 1998 mounted a 3-

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week intensive nationwide effort, dubbed “Operation Spring Clean,” that focused on seven areas of the country. In all, 717 

food stamp retailers were investigated in the seven sweep areas; 115 were caught trafficking and were immediately removed 

from the program pending further investigation. Immediate removal from the program in trafficking cases was among the 

new authorities granted to FNS under the welfare reform law. A total of 290 retailers were caught in program violations of 

all kinds. 

WIC Farmers’ Market Nutrition Program Gets Funding Increase 

Funding for the Farmers’ Market Nutrition Program was increased to $12 million in 1998, an increase of $5.25 million from 

last year, allowing the program to expand in current States and into five more State WIC agencies, bringing the total to 32 

States, the District of Columbia, and two Indian tribal organizations. More than 1 million WIC participants currently receive 

farmers’ market benefits to purchase fresh foods from over 8,200 farmers nationwide.

Breastfeeding Promotion

More than 50 WIC State agencies are now participating in USDA’s national breastfeeding promotion effort, the “Loving 

Support Makes Breastfeeding Work” campaign kicked off by Secretary Glickman in 1997. Promotional materials geared to 

various ethnic groups, TV and radio spots in English and Spanish, and banners and other promotional items are available for 

purchase by WIC State agencies, the medical and health community, and the public to educate not only mothers but the 

entire community about breastfeeding. 

Hammer Award Goes to South Carolina Combined Application 

Project (SCCAP) 

Working together, employees in the Social Security Administration 

(SSA) and FNS in South Carolina improved the way they deliver 

food assistance to elderly and disabled individuals. Eligible 

applicants may apply for food stamps jointly with supplemental 

security income (SSI) at the Social Security office. SSA determines 

FSP eligibility at the same time it determines eligibility for SSI. In 

the past, SSA employees completed a paper food stamp application 

(usually 8 to 11 pages) and sent it to the food stamp office for the 

State to process. But they no longer use a long paper form. This 

team developed a one-stop computer-based, online program, which 

eliminates two interviews and the need to visit several offices.

So far, SCCAP has brought in approximately 840 new SSI/FSP 

recipients each year of the demonstration, and outreach efforts have 

brought in over 8,500 new FSP cases. The project has also allowed 

the States to reallocate the equivalent of 40 full-time 

caseworkers—a savings of over $700,000. 

Improving Child Nutrition

In the autumn of 1998, FNS introduced “yourSELF,” a 

nutrition education kit aimed at middle school-age children. 

This represents a major expansion of the nutrition education 

initiative, which has been focused heretofore on elementaryage children. Introduction of “yourSELF” will increase the 

number of healthy-eating messages children receive.

FDPIR Food Package Improvements

People participating in USDA’s Food Distribution Program 

on Indian Reservations (FDPIR) began receiving a better, 

more healthful food package in 1998. Working with Native 

American tribal leaders, FNS developed a food package with 

more variety and choices without increasing the cost. 

Changes include more “user-friendly” products, such as 

frozen, cut-up chicken and sliced cheese rather than blocks. 

More low-fat and high-fiber products are included, such as 

bran cereal and low-fat refried beans. Other new products include egg noodles, quick oats, and more fruits and vegetables.

Memorandum of Understanding With HUD for Co-Location of Programs

People in federally supported housing developments will have better access to USDA’s nutrition, education, and child care 

programs because of a pilot program announced in May by Agriculture Secretary Dan Glickman and Housing and Urban 

Development (HUD) Secretary Andrew Cuomo. At pilot program sites in eight cities, USDA nutrition programs such as 

food stamps, WIC, child care, summer food service, and education programs offered through USDA’s Cooperative State 

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Research, Education, and Extension Service will be available to residents through offices located in their housing complex.

Center for Nutrition Policy and Promotion

Mission

The mission of the Center for Nutrition Policy and Promotion (CNPP) is to improve the nutritional status of Americans by 

serving as the focal point within USDA for linking scientific research to the consumer. CNPP provides direction and 

coordination for USDA’s nutrition education and policy activities. The center helps enhance the nutritional status of 

Americans by serving as the focal point for the Department in translating nutrition research into information materials to 

increase public understanding of the importance of good nutrition and a healthful diet.

Dietary Guidelines for the 21st Century

CNPP launched the Year 2000 update of the Dietary Guidelines for Americans with the first public meeting of the Dietary 

Guidelines Advisory Committee in September 1998. Every 5 years, the advisory committee, composed of experts in the 

fields of nutrition and health, meets to review the current dietary guidelines. During the review, the latest scientific evidence 

is considered in determining whether to recommend to the Secretaries of Agriculture and Health and Human Services that 

the guidelines be modified.

The Cost of Raising a Child in America

This CNPP report, published annually, outlines the cost of raising a child to age 18. As in years past, this year’s report 

received a great deal of attention in the news media, including a March 1998 cover story in U.S. News and World Report. 

Issuing the report from CNPP helps to solidify CNPP’s standing as the government’s best source of information on nutrition, 

health, and family economics.

The Healthy Eating Index: A Report Card on the American Diet

In July, CNPP issued its “report card on the American diet,” the Healthy Eating Index (HEI). The 1998 index showed that 

Americans in general are eating better—nutritionally speaking—than in past years, with the average HEI score rising about 2 

points to 64 (still in the “needs improvement” range). USDA is using the demographic results of the HEI survey to target 

nutritionally at-risk populations with nutrition education programs through the FNS’ food assistance programs. CNPP will 

continue to analyze the results of food intake studies conducted by USDA’s Agricultural Research Service, publicizing the 

results and raising awareness among the general public of the importance of a healthy diet.

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FY 1998 Annual Report of the Secretary of Agriculture

USDA: Preparing for a New Millennium 

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4. Raising Consumers' Confidence in Food Safety

Food Safety and Inspection Service

Mission

The Food Safety and Inspection Service (FSIS), a public health agency in USDA, protects consumers by ensuring that the 

Nation’s commercial supply of meat, poultry, and egg products is safe, wholesome, and accurately labeled, as required by 

the Federal Meat Inspection Act (FMIA), the Poultry Products Inspection Act (PPIA), and the Egg Products Inspection Act 

(EPIA).

FSIS inspects livestock and poultry before and after slaughter, and also regulates all raw beef, pork, lamb, chicken, and 

turkey, as well as processed meat and poultry and egg products prepared for distribution in interstate and foreign commerce, 

including imported products. More than 7,500 Federal inspectors carry out inspection laws in over 6,000 plants. 

Foodborne illness is recognized as a significant public health problem in the United States. FSIS develops new methods of 

inspection to better protect the public health. It tracks new and emerging public health problems related to food safety. And 

it responds to microbiological, residue, and other contamination incidents and, when appropriate, seeks voluntary recall of 

products by firms. 

FSIS continues to carry out a broad and long-term, science-based strategy to improve the safety of meat, poultry, and egg 

products and to better protect public health. The agency is undertaking a farm-to-table approach by taking steps to improve 

the safety of meat and poultry at each step in the food production, processing, distribution, and marketing chain. These steps 

are designed to focus more attention on the risk of microbial contamination, the Nation’s most significant food safety 

problem. 

Accomplishment Highlights, FY 1998

HACCP Implementation Successful 

On January 26, 1998, more than 300 large meat and poultry plants (those with 500 or more employees) were required to 

have Hazard Analysis and Critical Control Points (HACCP) systems in place. Large plants account for approximately 75 

percent of slaughter production.

USDA Works With Small Plants To Facilitate HACCP 

Implementation

On May 7, USDA food safety officials met with owners and 

managers of small plants preparing for the HACCP implementation 

date of January 25, 1999, to discuss additional ways of ensuring 

that small plants receive the assistance they need to make the 

transition to HACCP.

FSIS Initiated an Aggressive Outreach Program To Assist 

Small Plants With HACCP Implementation 

FSIS efforts to assist small plants (defined as having 10 or 

more employees, but fewer than 500) include three initiatives. 

The first is working with a HACCP coordinator in each State 

to bring together resources for that State. Second, FSIS is 

encouraging land-grant universities that conduct livestock or 

poultry slaughter or processing operations to develop HACCP systems for their operations and to serve as sources of 

information for small plants. And third, industry and trade association personnel, extension agents, and other appropriate 

people are strongly encouraged to act as “sponsors” to small plants by offering technical information on HACCP systems.

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Nationwide Series of 20 Public Meetings To Help Small Plants 

FSIS held the first 2 of a series of 20 public meetings across the country on HACCP implementation for small plants. The 

purpose of these meetings is to discuss ways to help owners and managers of small plants prepare for the January 25, 1999, 

HACCP implementation date. 

Technical Service Center Operates HACCP Hotline 

Since its beginning on January 20, 1998, the HACCP Hotline has handled over 10,000 inquiries, contributing to the 

successful implementation of HACCP during this critical time. 

Risk Assessments 

FSIS initiated the first farm-to-table quantitative risk assessment for Salmonella enteritidis in eggs and egg products. Results 

were presented at a June 12, 1998, risk forum sponsored by USDA’s Office of Risk Assessment and Cost-Benefit Analysis. 

A risk assessment is also underway for E. coli O157:H7 in meat. 

FSIS Issues Rule on Requirement for Shell Eggs 

At the direction of Congress, FSIS published a final rule on new regulations implementing requirements for refrigeration and 

labeling of shell eggs. The rule implements 1991 amendments to the Egg Products Inspection Act.

Encouraging Results in First 6 Months of Testing for Salmonella in Large Meat and Poultry Plants 

FSIS released a progress report on the first 6 months of testing for Salmonella in large meat and poultry plants. Because the 

data is preliminary, FSIS is taking a conservative approach in interpreting and presenting the data; however, there is a 

general trend toward lower percentages of products that are positive for Salmonella. 

Risk Analysis on BSE To Be Done by Harvard School of Public Health 

USDA entered into a cooperative agreement with Harvard University’s School of Public Health to conduct a risk analysis to 

assess the potential pathways for bovine spongiform encephalopathy (BSE) to enter into U.S. cattle and the U.S. food 

supply, to evaluate existing regulations and policies, and to identify any additional measures that could be taken to protect 

human and animal health. 

Public Meeting on the Browning of Ground Beef

On May 27, USDA held a public meeting to discuss the food safety 

issues presented by premature browning of ground beef, during 

which USDA released results of a new study on the premature 

browning of cooked hamburger that concluded that color is not a 

good indicator that a hamburger has been cooked to 160 degrees F, 

USDA’s recommended safe level.

Meat and Poultry Hotline 

The hotline received 164,575 calls during FY 1998. Hotline 

specialists spoke with approximately 38,621 of those callers 

during business hours, recording data that were used for trend 

analysis. In addition to basic food handling, storage, and 

preparation questions, the hotline addressed the latest issues: 

BSE; product recalls; E. coli O157:H7 testing; premature 

browning of ground beef; transportation and storage of shell eggs; HACCP implementation; campylobacter, Salmonella and 

poultry; irradiation; and organic labeling.

One of the year’s highlights was the November 25 visit by Secretary of Agriculture Dan Glickman. Secretary Glickman 

personally answered several hotline calls. The event generated interest in the hotline among the reporters in attendance, and 

crews from both NBC and CNN returned subsequently for filming and interviews.

Science-Based Advice for Consumers Cooking Ground Beef 

Research by FSIS and ARS supported the hypothesis that the color of a cooked hamburger is not a reliable indicator that a 

safe internal temperature has been reached. FSIS was instrumental in devising the study protocol and presenting the findings 

and implications for consumer education through several public meetings. To convey the message to consumers that safety is 

signified by a reading of 160 degrees F. on a thermometer, FSIS, the Office of the Secretary, the Office of the Under 

Secretary for Food Safety, and the White House worked together to plan an event featuring Vice President Gore and 

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Secretary Glickman—a July 2 barbecue held on the Jamie L. Whitten Federal building lawn.

Safe Summer Grilling

On July 2, Secretary Glickman and Vice President Al Gore led a 

safe summer grilling food safety event on the grounds of USDA 

headquarters. The Secretary and FSIS food safety experts had a 

cookout that emphasized why clusters of serious illness can be 

associated with meat contaminated through poor food handling and 

grilling techniques. They emphasized the importance of avoiding 

undercooking, using a thermometer to test doneness, and the critical 

need to keep food and cooking tools clean and free of crosscontamination.

Partnership for Food Safety Education Fight BAC!TM 

As a founding member of the private-public partnership, 

FSIS was in the forefront of the campaign to instill the four 

key messages of the Fight BAC!TM campaign in the mind of 

every American. FSIS managed several campaign initiatives 

during the year. These include placement of the Fight 

BAC!TM brochure at the Consumer Information Center (CIC) 

in Pueblo, Colorado; an estimated 50,000 copies have been 

distributed through CIC. The agency also managed requests 

for the Fight BAC!TM costume, exhibit, and puppets at 

locations nationwide. A Food Safety Education Month poster—developed in cooperation with the American School Food 

Service Association and the Food and Drug Administration (FDA)—was distributed to 53,000 elementary school cafeterias. 

Finally, FSIS reviewed proposals to produce an educational package for middle-school students; the firm has been selected 

and work has begun.

National Food Safety Information Network 

The President’s National Food Safety Initiative directed agencies to establish a national clearinghouse for food safety 

education. FSIS worked with FDA to develop a proposal for this “clearinghouse,” which is currently referred to as the 

National Food Safety Information Network. One of the Network’s components was put into place in FY 1998 when 

government food safety sites on the World Wide Web were linked to help web users more easily find government 

information on food safety. The URL is http://www.foodsafety.gov/

Food Safety Enforcement Enhancement Act of 1998 

This bill was developed by the Secretary and forwarded to Congress to amend the Federal Meat Inspection Act and the 

Poultry Products Inspection Act to provide for improved public health and food safety through enhanced enforcement.

President’s Executive Order Creates Food Safety Council 

An Executive Order signed by President Clinton on August 25, 1998, established the President’s Council on Food Safety. 

The primary functions of the Council will be to develop a comprehensive strategic Federal food safety plan; advise agencies 

of priority areas for investment in food safety, ensure that Federal agencies annually develop coordinated food safety 

budgets; and oversee the recently established Joint Institute for Food Safety Research, ensuring that it addresses the highest 

priority research needs. The Secretaries of the Departments of Agriculture and Health and Human Services and the Assistant 

to the President for Science and Technology/Director of the Office of Science and Technology will serve as Joint Chairs of 

the Council.

EdNet 

EdNet, the National Food Safety Educator’s Network, is an 

electronic network for food safety educators. It is intended as a oneway direct mail food safety education update from the FDA, 

USDA, and the Centers for Disease Control (CDC).

FSIS Makes Report to Congress Available 

FoodNet: An Active Surveillance System for Bacterial 

Foodborne Disease in the United States, April 1998, is a 

report generated by the collaborative project among FSIS, 

CDC, and FDA; it includes data on the incidence of 

foodborne illness for calendar year 1997. 

HACCP-Base Inspection Models Project 

FSIS is designing new models for inspection within plants that slaughter three specific classes of animals to define what the 

agency and the regulated industry should do when those plants are operating under HACCP. With inspectors in these 

slaughter plants no longer carrying out activities that should be the plant’s responsibility, FSIS could better focus on public 

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health concerns and further implement its farm-to-table strategy.

New Computer Network To Fight Foodborne Illness Launched 

On May 22, 1998, Vice President Gore announced a new national computer network called PulseNet that will be five times 

faster in identifying foodborne illness. PulseNet will enable public health laboratories throughout the country to use the 

Internet to provide alerts when outbreaks of foodborne disease occur. 

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FY 1998 Annual Report of the Secretary of Agriculture

USDA: Preparing for a New Millennium 

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5. Creating Jobs and Revitalizing the Economy in Rural Areas 

Rural Development Mission

The mission of Rural Development is to enhance the ability of rural communities to develop, to grow, and to improve their 

quality of life by targeting financial and technical resources in areas of greatest need through activities of greatest potential.

Program Summaries

The following is a summary of the number of loans and grants made by each program in USDA’s Rural Development 

mission and of the economic benefits provided by each:

Hero of Ice Storm Named Maine Multi-Family Housing Site 

Manager of the Year

A former tenant of the RHS rural rental housing-financed apartment 

complex called Stonington Manor in Maine, Eric Hoard is now its 

manager. During the January 1998 ice storm, Mr. Hoard brought 

wood from his own home for a community room stove and used his 

own resources to arrange for a barbecue on a gas grill so residents 

in the all-electric complex would have heat and food while the 

housing was without power. In recognition for his efforts, Mr. 

Hoard has been named the USDA Maine Multi-Family Housing 

Site Manager of the Year for 1998. When asked what the best thing 

about his job is, Mr. Hoard says, “Working with the tenants.”

Single-Family Housing

Direct Rural Housing Loan Program (Section 502 direct)

This program offers low-interest homeownership loans to 

rural America’s working people. Approximately 40 percent 

of the people it serves earn less than 50 percent of the median 

income of the rural area in which they live; the remainder 

earn between 50 and 80 percent. In FY 98, the program 

obligated $999.8 million to enable approximately 17,200 

families to become homeowners. 

Mutual Self-Help Housing Program

This program makes mortgage costs affordable to people with very low and low incomes by allowing them to contribute 

“sweat equity,” which they earn by building their own homes. The program provides grants to nonprofit and municipal 

technical assistance providers, who supervise small groups of families in the construction of their own homes. The families 

typically finance their homes through USDA direct rural housing loans. In FY 1998, the Rural Housing Service (RHS) 

provided 117 grantees in 43 States with a total of $26 million in technical assistance grants. In turn, the grantees supervised 

1,520 families in the construction of their own homes. The families received $110.4 million in direct rural housing loans 

from USDA.

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Guaranteed Rural Housing Loan Program (Section 502 guarantee)

This program provides guaranteed loans of up to 90 percent to low- and moderate-income rural Americans who otherwise 

would not be able to obtain credit. It also allows borrowers to obtain loans for 100 percent of the appraised value of a house, 

thereby removing the downpayment barrier that prevents many people from becoming homeowners. In FY 1998, the 

program obligated $2.8 billion to allow approximately 39,400 families to purchase homes.

Rural Home Repair Loan and Grant Programs (Section 504)

These programs provide funds to help very low-income people undertake the vital improvements necessary to make their 

homes habitable. These include weatherizing the homes, removing electrical and fire hazards, repairing roofing, and 

installing or improving water and waste-water disposal systems. The grant program serves people ages 62 and up, while the 

loan program is open to all very low-income rural people. In FY 1998, the home repair loan and grant programs obligated 

$54.4 million to allow approximately 11,100 families to make vital improvements to make their homes safe and liveable.

Economic benefits provided by Single-Family programs

Together, Single-Family housing programs provided 83,183 full-time jobs in construction and construction-related 

industries, $1.3 billion in wages, and $700.9 million in combined Federal, State, and local revenues and fees.

Total number of homes financed: 56,500 

Total number of homes rehabilitated: 11,100 

Total financing provided: $3.98 billion

Multi-Family Housing

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RHS Community Facilities Program Helps Rural New York 

Teen Chemical Dependency Treatment Center To Double Its 

Capacity 

The Rose Hill Foundation, Inc., in Massena, New York, is a unique, 

freestanding chemical dependency treatment center devoted to 

adolescents, ages 12-18. Not only does it provide treatment to help 

chemically dependent teens overcome their addictions, but it also 

offers post-rehabilitation treatment counseling, which has been 

completed by 89 percent of its patients. The treatment center has 

been in existence for 10 years and has served 900 adolescents. 

Approximately 50 percent of its patient base is homeless. 

In April 1998, the facility received an RHS Community Facilities 

direct loan of $700,000, an $855,000 grant from the Office of 

Temporary and Disability Assistance Homeless Housing Program, 

and a $50,000 grant from the New York State Community Facilities 

Enhancement Fund. Through these funds, Rose Hill will be able to 

double its bed capacity from 15 to 30. Four beds will be designated 

for adolescent parents, their children, and pregnant teens. In 

addition, Rose Hill will be able to double the number of people it 

serves each year, going from 100 customers to 200. Rose Hill 

makes its unique and vital services available to the entire State of 

New York.

Rural Rental Housing Direct Loan Program (Section 515)

This program makes low-interest loans to developers of 

affordable rural rental housing. In 1998, RHS obligated $93.7 

million toward construction of 122 new rental complexes 

providing approximately 2,400 units. It also obligated $56.3 

million toward the repair and rehabilitation of existing units 

in 228 rural rental facilities.

Farm Labor Housing Loan and Grant Program (Section 

514/516) 

The only national source for farm labor housing construction 

funds, this program provides low-interest loans and grants to 

developers of affordable rural rental housing for 

farmworkers, who are among the most poorly housed people 

in the country. These developers may be public or nonprofit 

agencies or farmers. In 1998, the program obligated $27.1 

million to build 419 new units and rehabilitate seven rental 

complexes.

RHS Teams Up with Partners To Help Kentucky Couple Move 

From Log Cabin to New Home 

In 1998, Rayburn and Sarah Watson contacted Kentucky Rural 

Development seeking funds to repair their log cabin, built in 1866 

and occupied continuously since then by family members. Rural 

Development determined that the house was beyond repair: the 

foundation was severely deteriorated, the home lacked running 

water and bathroom facilities, and the home was heated by a woodburning cook stove and a gas heater. Rural Development teamed 

up with the Federation of Appalachian Housing Enterprises 

(FAHE) and Peoples Self Help Housing, Inc., to provide a 

leveraged USDA Section 502 direct rural housing loan to build Mr. 

and Mrs. Watson a new home. The Watsons are so pleased that 

they no longer have to carry water for cooking, washing dishes, 

and doing laundry; that they have a bathtub; that they have level 

floors and carpet; and that their house is warm and insulated. Mr. 

and Mrs. Watson appreciate the attention to detail and 

workmanship that they feel make their house such a beautiful 

home. Mrs. Watson states that “We also appreciate the forethought 

the builders displayed by always taking into consideration my 

height and physical shortcomings.” Mr. and Mrs. Watson 

expressed their appreciation for the hard work of staffs of Rural 

Development, FAHE, and Peoples Self Help Housing.

Rental Assistance Program (Section 521)

This program makes rents in USDA rural rental housing and 

farm labor housing affordable to the tenants. In FY 1998, 

RHS provided over $540 million in rental assistance to more 

than 39,000 tenants.

Rural Rental Housing Guaranteed Loan Program (Section 

538)

This program guarantees loans for developers of affordable 

rental housing. In FY 1998, the Section 538 program 

approved loan guarantees worth $39.7 million to build 28 

rural rental housing developments with a total of 1,110 

apartments in 14 States.

Housing Preservation Grant Program (Section 533)

This program provides grants to nonprofit organizations, 

Indian tribes, and Government agencies to bring up to code 

deteriorating single- and multi-family housing for very lowand low-income families. In 1998, the program provided $11 

million to 165 organizations to rehabilitate 2,975 houses and apartments. 

Economic benefits provided by Multi-Family programs

Together, Multi-Family housing programs provided 4,147 full-time jobs in construction and construction-related industries, 

$136.8 million in wages, and $72.4 million in combined Federal, State, and local revenues and fees.

Total number of new apartments financed: 3,940 

Total number of apartment buildings renovated: 235 

Total number of single-family homes and/or apartments renovated: 2,975 

Total financing provided: $775.5 million

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Business Loan Adds Jobs in Tennessee 

A $400,000 Rural Business-Cooperative Service loan to the 

Meriwether Lewis Electric Cooperative in Centerville, Tennessee, 

will be re-loaned, interest free, to the Stewart Houston Industrial 

Park Board in Houston County to construct a 40,000-square-foot 

industrial building to house Southern Gage, Inc., producer of a full 

line of gauge products for industrial manufacturing processes. 

Southern Gage currently employs 70 people and expects to add 124 

new jobs as the result of its $1.8 million planned expansion. Over 

the past several years, Houston County has consistently 

experienced unemployment ranging 2 to 3 times higher than the 

national average. The new employment opportunities will have a 

dramatic effect on the economy of Houston County and 

neighboring Stewart County.

Community Facilities

Community Facilities Direct Loan Program

This program provides direct loans to rural communities for 

essential community facilities. These include child care 

centers, adult care centers, hospitals, clinics, schools, 

municipal buildings, and community centers, as well as 

emergency rescue equipment, among others. In 1998, the 

program obligated $210.9 million to fund 423 projects.

Community Facilities Guaranteed Loan Program

This program provides loan guarantees of up to 90 percent to 

rural communities to build essential community facilities. 

These include child care centers, adult care centers, hospitals, clinics, schools, municipal buildings, and community centers, 

as well as emergency rescue equipment, among others. In FY 98, the program obligated $65.5 million to fund 69 projects.

Community Facilities Grant Program

The grant program helps very low-income communities finance their facilities by reducing the amount of debt which must 

be incurred to acquire facilities. These facilities include child care centers, adult care centers, hospitals, clinics, schools,

municipal buildings, and community centers, as well as emergency rescue equipment, among others. In 1998, the grant 

program obligated $9.5 million in grants to help fund 267 projects.

Economic benefits provided by Community Facilities programs—

Together, Community Facilities programs provided 9,911 full-time jobs in FY 1998. 

Total number of communities with new or improved essential community facilities: 422 

Total financing provided: $285.9 million

Rural Development Program Purchases Equipment To 

Establish Tribal Business

A Rural Business Enterprise Grant (RBEG) was approved for the 

Red Lake Band of Chippewa Indians (Tribe), Red Lake, Minnesota, 

in the amount of $180,000, which will be used to acquire 

manufacturing equipment. The grant is a portion of the funding 

needed to complete the project. The tribe will own and lease a 

building and equipment to a tribal-owned manufacturer of window 

blinds and shades, Anderson Fabrics, Inc. The unemployment rate 

on the reservation is one of the highest in the State. This project 

brings together a number of Federal, State, and local resources to 

finance a multi-purpose facility to assist with the transition of tribal 

members from unemployment into a fully trained and educated 

work force. It is projected that 30 new jobs will be created.

Rural Business Programs Business and Industry 

Guaranteed Loan Program 

In a partnership with the Department of Treasury and the 

North American Development (NAD) Bank, the USDA 

Business and Industry Guaranteed Loan Program provided 

$73 million in loans that created or saved over 2,000 jobs in 

areas impacted by NAFTA-related trade. The total cost to the 

Government was under $500 per job.

Electric Program 

The Electric Program approved 74 loans for a total of $539 

million to Rural Utilities Service (RUS) borrowers serving counties identified as persistent poverty counties. In addition, 72 

loans for a total of $286 million were approved for borrowers serving counties identified as having persistent outmigration. 

Based upon financial and statistical information provided by RUS borrowers, 2.7 million consumers benefited from electric 

system improvements that were made during FY 1998.

Telecommunications 

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During FY 1998, the Telecommunications Program improved the information superhighway for rural America by making 

loans and loan guarantees of $565 million for 53 rural telecommunications projects that provided improved service to more 

than 1.2 million rural residents, including new service to 225,000 residents. Improvements will include installation of $94 

million of new digital switching technology and nearly 7,000 miles of fiber optic cable and associated electronic equipment 

costing $210 million. Some of these facilities will be used specifically to connect an additional 16 schools to distance 

learning systems. These and other system enhancements are making advanced telecommunications services available to 

more rural Americans than ever before. For every million dollars of loan funds spent by RUS/RTB (Rural Telephone Bank) 

borrowers, an additional $4.7 million in private investments was spent by these borrowers on telecommunications facilities.

RUS Supports Distance Learning and Telemedicine 

RUS provided $7.9 million in grants and $2.6 million in loans for 35 distance learning projects and $4.6 million in grants 

and nearly $1 million in loans for 25 telemedicine projects that will serve rural residents through educational centers and 

health care providers at approximately 300 separate sites. Eight of the awards will be used to assist people in Empowerment 

Zones and Enterprise Communities.

EC Funding Begins Flood Prevention Project in Missouri EC

In the past, residents in the East Prairie, Missouri, EC had to be 

evacuated when the river rose, flooding the 130,000-acre St. Johns 

Basin. Flood control measures, authorized in 1954, had continually 

been hampered by financial limitations. Now, thanks to funding 

from USDA and the Army Corps of Engineers, residents can rest 

easy.

EC designation “has been the enabling factor to get the project to 

move forward,” says Eddie Belk, project manager of the Memphis 

District Corps of Engineers. The program enabled USDA to 

provide all but 5 percent of the local community’s cost share for the 

first phase of this $42.5 million project. This funding provided 

momentum for other sponsors. 

Water and Environmental Programs 

During FY 1998, the Water and Environmental Programs 

provided more than $1.3 billion in loans and grants for over 

1,200 rural water or wastewater projects that serve 9 million 

people, creating over 55,000 jobs.

Water 2000 

About 1 million residents of rural America lack safe, clean 

drinking water in their homes. RUS has been spearheading 

the Water 2000 initiative to provide this basic resource that 

most Americans take for granted. RUS conducted State-byState need assessments and determined that 25 million rural 

residents experience water-related health problems, are forced to haul water, or are under orders to boil water. In the first 3 

years of this program, RUS invested more than $735 million in loans and grants to the Nation’s highest priority Water 2000 

projects. The average median household income for the service areas is only $18,662. Water 2000 funded 87 projects in 

1998 to improve the drinking water systems serving over 77,000 households, to improve service to over 250,000 people, and 

to provide first-time public water to over 39,000. 

Program Accomplishments

Community Facilities Program Finances More Child Care Centers Than Ever Before 

The Community Facilities program has made financing child care centers a high priority. In FY 1998, the program provided 

$13.1 million in loans, grants, and guarantees to fund 46 child care centers.

Community Facilities Program Provides More Funding Than Ever Before for Indian Facilities 

In FY 1998, the Community Facilities program provided 18 loans, grants, and guarantees worth $14.2 million going to fund 

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Rural Residents Receive High-Tech Hardware and New Skills 

in Ohio EC 

Through the President’s Education Technology Program, USDA 

has made 72 computers (with an estimated value of $10,000) 

available to Greater Portsmouth, Ohio, EC schools. The EC is 

dedicating an additional $192,000 of its $2.95 million EZ/EC 

Social Service Block Grant funds for in-service computer training 

for teachers. More support for this program is expected—Greater 

Portsmouth has learned that it is eligible for funding under a State 

program that helps low-income communities obtain computers.

14 projects on 14 Indian reservations. Projects included three 

child day care centers, one adult day care center, two social 

services centers, two college buildings, one outpatient care 

facility, one physician-staffed clinic, one city hall, one fire 

department, one community center, and one assisted-living 

facility.

Rural Utilities Service and the Federal Energy Regulatory 

Commission 

RUS has continued to be actively involved in proceedings at 

FERC on matters affecting restructuring of the electric utility industry and RUS borrowers. FERC regulates wholesale 

electric power markets and interstate transmission of electricity by public utilities. RUS electric borrowers are not generally 

subject to FERC regulation. However, FERC’s initiatives at opening up the Nation’s transmission systems to promote robust 

competition among electric generators are increasingly bringing RUS borrowers before the Commission.

Community Facilities Programs at an All-Time High Number of Borrowers Current on Their Loans 

Fully 100 percent of Community Facilities direct loan program borrowers and 99 percent of Community Facilities 

guaranteed loan program borrowers are current on their loans. The Community Facilities programs are doing an excellent 

job of both serving their rural customers and protecting taxpayers’ investments.

Electricity for the First Time 

RUS provided financing for facilities that The Socorro Electric 

Cooperative, Inc., headquartered in Socorro, New Mexico, 

constructed to electrify a very remote part of rural America. 

Socorro is building up to 20 miles of 14.4 kV line and secondary 

power extensions to serve consumers in Riley, New Mexico, who 

have never received central station electrical service. This unserved 

area is so remote that it requires a 50-mile drive from Socorro’s 

headquarters, of which 20 miles is on dirt roads. The people of this 

area are mostly Hispanics and Native Americans, and they have 

been living here all their lives without electricity or running water. 

Initially, 14 residents will receive electric service.

Multi-Family Housing Reaches Record-Low Loan 

Delinquency 

The Multi-Family Housing loan program reached a recordlow delinquency rate of 1.9 percent as of September 30, 1998. 

This is an all-time low and is lower than almost all privatesector rates. This delinquency rate is based on a loan portfolio 

of 18,002 projects and an outstanding loan principal of $11.9 

billion. The Multi-Family Housing program is doing an 

excellent job of both serving its rural customers and 

protecting taxpayers’ investments.

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RHS Develops Partnerships With the Nonprofit and Private Sectors To Provide Affordable Rural Single-Family 

Housing 

RHS has been actively developing partnerships to leverage its limited single-family housing program dollars and increase 

affordable homeownership opportunities for rural America’s working people. In FY 1998, RHS significantly expanded its 

Rural Home Loan Partnership with the Federal Home Loan Bank System and the Rural Local Initiatives Support 

Corporation. RHS’s partners leveraged RHS’s contribution of $12.9 million with $6.9 million of their own funds.

RHS also initiated a partnership with various Community Development Financial Institutions (CDFIs) and their privatesector partners throughout the country. The purpose of the partnership is to provide homeownership opportunities to very 

low- and low-income applicants by combining the resources of RHS, the CDFIs, and their private-sector partners. Through 

15 local partnerships, 55 rural families have received home loans at rates significantly more affordable than those in the 

private sector. RHS provided $2.9 million, which the CDFIs and their private-sector partners leveraged with $992,000 of 

their own funds.

Revolving Fund Launches Entrepreneurial Ventures in Pennsylvania Enterprise Community

Small, startup businesses are often unable to borrow startup money because banks and other lending institutions favor 

businesses with established track records. To help creditworthy startup businesses, the City of Lock Haven, Pennsylvania, 

allocated $200,000 in Enterprise Community (EC) funds to create the Commercial Revolving Loan Fund. Owners of retail, 

service, or commercial businesses in Lock Haven are eligible for low-interest loans of up to $25,000 to improve their 

facilities, expand an existing business, or start a new business.

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New Water System in New York 

Water and Environmental Programs provided a loan of $822,400 

and a grant of $677,600 to install 20,420 linear feet of 8-inch water 

main, 35 fire hydrants, and 2 pressure-reducing valves in the Park 

Terrace Water District in the Town of Birmingham, New York. 

Water will be supplied from the City of Birmingham. This project 

will serve 155 users. The township has endured extreme hardship 

from depleted ground water resources. Public health concerns 

engendered by this situation include lack of adequate water for 

drinking and food preparation, lack of adequate water for personal 

hygiene and household cleaning, and inefficiency of the sanitary 

sewer system. 

Many residents were collecting rainwater, snow, and roof runoff for 

domestic use. Many properties had been abandoned since they have 

been inhabitable due to a lack of domestic water. Other residents 

hauled water to maintain their homes. Without RUS assistance, 

these homeowners would have been without water for a year or 

many years. 

The City of Lock Haven received a $500,000 USDA Rural 

Business Enterprise Grant to expand the loan fund; the city 

also developed a grant program in conjunction with the fund. 

Small businesses that are planning renovations or 

construction can apply for grants of up to $5,000. 

Kentucky Highlands EZ Attracts 13 New Businesses 

Since receiving its designation as an Empowerment Zone 

(EZ) 3 years ago, the Kentucky Highlands EZ has assisted 13 

businesses that have either located or made commitments to 

locate within the EZ area. The EZ has invested more than 

$4.1 million in local businesses, which now employ more 

than 160 residents of Clinton, Jackson, and Wayne Counties.

RUS Influences Telecommunications Worldwide 

The influence of the RUS Telecommunications Program reaches 

around the world. The government of South Africa asked the 

National Telephone Cooperative Association (NTCA) to help find 

a way to get telecommunications services into the unserved and 

underserved areas of the country. NTCA is using RUS statistical 

reports from 1961 to1996 to profile the progress that rural 

cooperatives have made in the United States. Through analysis of 

this statistical information, NTCA expects to show how 

cooperatives start with little capital, grow stronger with time, and 

eventually can sponsor rural economic development projects of 

their own. The NTCA representative said that the RUS statistical 

information is the best in the industry, and that without it this task 

would be very difficult.

Debt Refinancing Provides Savings 

Electric program staff, working with five RUS rural electric 

cooperative power supply borrowers, produced annual savings 

of more that $30 million for rural consumers in four States by 

refinancing high-interest utility debt. These refinancing 

savings can be passed on to the power supply borrowers’ 

member distribution cooperatives and to their members—rural 

Americans. The North Carolina Electric Membership 

Corporation of Raleigh, North Carolina; Georgia 

Transmission Corporation of Tucker, Georgia; East River Electric Power Cooperative in Madison, South Dakota; and ShoMe Power Cooperative in Marshfield, Missouri, refinanced $1,199,065,066 in Federal Financing Bank loans, guaranteed by 

RUS, to provide the savings.

Development of the Administration’s Comprehensive Electric Competition Plan 

USDA and RUS actively participated in the development of the President’s Electric Competition Plan and proposed 

legislation. USDA participation on the White House Interagency Working Group on Restructuring increased awareness of 

the many challenges facing rural areas in maintaining access to affordable electric power. 

As a result of interagency discussions, the President’s Plan and legislation sent to Congress in June 1998 contain a number of 

provisions to protect rural electric systems and their customers. The legislation requires the Federal Energy Regulatory 

Commission (FERC) to recognize the special nature of rural electric systems and to assure that RUS borrowers will, to the 

maximum extent practicable, be able to meet their loan obligations. The Plan also provides for a rural safety net to offset 

adverse economic consequences for rural systems to be administered through a public benefits fund. 

Community Facilities-Financed Hospital Named Best Hospital in the Nation With Fewer Than 350 Beds 

Recently, Solution Point, a hospital survey company, named North Hawaii Community Hospital the best hospital in the 

Nation with fewer than 350 beds. The 50-bed hospital won a Best in Class Consumer Satisfaction Award for total processes. 

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Village of Kongiganak, Alaska 

Kongiganak, a USDA Rural Development-designated Champion 

Community, received a $300,000 Rural Alaska Village Grant to 

match a $500,000 grant from the State of Alaska. These funds will 

upgrade wastewater treatment facilities and the community’s 

washeteria, which is the only source of drinking water for the 

community’s 349 native Alaskans. Currently, some residents use 

rain catchments during the summer and ice melt in the winter for 

their fresh water supply. Wastewater is removed by using honey 

buckets that are hauled by the village to a pretreatment plant at the 

sewage lagoon. The project will also locate and develop a potable 

water supply for this remote, rural Alaskan village.

The hospital also won top awards among small hospitals for 

housekeeping and food services. The hospital combines 

modern medicine with health care not normally found in a 

hospital, such as psychology, naturopathy, chiropractic, 

massage therapy, and acupuncture. North Hawaii Community 

Hospital was funded through a $15 million Community 

Facilities guaranteed loan made by Bank of America. The 

State of Hawaii provided grant funds and the local 

community raised $6 million in contributions.

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1998 Annual Report of the Secretary/ ARP 6

FY 1998 Annual Report of the Secretary of Agriculture

USDA: Preparing for a New Millennium 

black line

6. Investing in the Future Through Research, Education, and Economics

Agricultural Research Service

Mission

As USDA’s main in-house research arm and one of the four agencies that make up the 

Research, Education, and Economics mission area, the Agricultural Research Service 

(ARS) conducts research to develop and transfer solutions to agricultural problems of 

high national priority and provides information access and dissemination to:

● Ensure high-quality, safe food, and other agricultural products, 

● Assess the nutritional needs of Americans, 

● Sustain a competitive agricultural economy, 

● Enhance the natural resource base and the environment, and 

● Provide economic opportunities for rural citizens, communities, and society as a 

whole. 

Selected accomplishments for FY 1998

● A new product created by ARS researchers significantly reduces potential 

Salmonella contamination in chickens. In U.S. field tests involving 80,000 

chickens, the product—called PREEMPT—reduced Salmonella from about 7 

percent in untreated chickens to zero percent in treated chickens. PREEMPT is a 

blend of 29 live, non-harmful bacteria naturally present in healthy adult chickens. These bacteria are sprayed in a fine 

mist over newly hatched chicks and prevented Salmonella from gaining a foothold in the chicks’ intestines.

● The water quality threat from phosphorus in chicken and pig manure could be greatly reduced by a new type of feed 

corn that’s low in phytic acid. Phosphorus loss to manure is 25 to 40 percent less when animals eat the low-phytic 

acid corn discovered by an ARS scientist. Excess phosphorus pollutes many bodies of water such as the Chesapeake 

Bay. 

● An enzyme in horseradish could make it easier to produce life-saving anti-cancer drugs, preliminary research by ARS 

scientists suggests. The scientists devised a method that uses the enzyme horseradish peroxidase in making cancer 

drugs known as chlorins. The new one-step method could save time and money. 

● Tender, affordable meats with less fat could come from hydrodyne, technology that uses shock waves to improve the 

texture of everything from lamb chops to steaks. Hydrodyne was developed in part by ARS scientists. With 

hydrodyne, underwater shock waves from a high-energy explosive charge tenderize meat with pressures as high as 

25,000 pounds per square inch. Hydrodyne technology can provide a 50- to 70-percent improvement in tenderness of 

less tender meat. Hydrodyne also provides an alternative to fat as a source of tenderness. 

● ARS scientists showed that putting a little extra color in the tomato patch can reduce the need for pesticides and boost 

yields, too. In field studies in South Carolina, tomato plants grown with red plastic mulch in nematode-infested soil 

produced 17 pounds of fruit, more than double the yield of tomatoes grown with traditional black plastic mulch on 

infested soil. This was the first study documenting that red mulch suppresses damage from the root-dwelling 

nematodes. 

● A study of 247 women at the USDA Human Nutrition Research Center on Aging at Tufts, Boston, confirmed that 

long-term use of vitamin C supplements substantially reduces the risk of cataract—a clouding of the eye’s lens. There 

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Farm*A*Syst Home*A*Syst Wins Hammer Award

This national program, centered at the University of Wisconsin, 

is an example of how Federal and State government agencies 

and the Extension services of the State land-grant college 

system can creatively work together to benefit rural America 

and the environment. Most people know that water pollution 

can come from crop land, rangeland, and livestock areas. But 

water pollution can also be generated around the farmstead 

where farm buildings are located, where petroleum and 

chemicals are stored and handled, and where animals are 

maintained and farm equipment serviced. Landowners are 

usually not aware of these problems, cost-effective abatement 

actions, or government assistance programs. This program, 

jointly funded by USDA’s CSREES and NRCS and EPA, has 

addressed this need with a unique approach. A small 

interagency team refined prototype education/assessment 

materials for several States. Alternative delivery approaches 

were piloted and lessons learned were shared with other State 

teams. Farm*A*Syst assessment and educational packages 

organize technical and management information obtained from 

a variety of disciplines and government agencies into one 

simplified and highly usable system of up to 15 educational 

models and worksheets. Using these, farmers develop action 

plans to reduce or eliminate pollution risks on their property.

were 77 percent fewer early-stage cataracts among the 

women who took the supplements daily for more than 10 

years than among those who didn’t take the supplements. 

● From corn fiber, a low-value byproduct of corn wet 

milling, ARS scientists developed two valuable new 

products: “Amaizing oil,” a corn fiber oil that may lower 

cholesterol, and “Zeagen,” a white corn fiber gum. 

Feeding studies with hamsters indicated that “Amaizing 

oil” significantly lowered total serum cholesterol and 

LDL cholesterol, the kind that clogs the arteries. The corn 

fiber gum could be used in food as an emulsifier, a 

soluble dietary fiber, or a thickener, and also has potential 

industrial applications for use in adhesives and waterbased paint thickeners. 

● ARS scientists have identified the instigator behind the 

age-related decline in T cell function—which coordinates 

the body’s response to an infectious agent. What’s more, 

they were able to reduce the effects of this instigator in 

cultured cells. The scientists showed that prostaglandin 

E2 (PGE2) might contribute to the decline of T cell 

function in seniors because too much of this inflammationproducing substance has been shown to suppress T cell 

activity. Adding the antioxidant vitamin E to the cell 

cultures reduced PGE2 levels and improved T cell function. This suggests that people might slow the dysfunction of 

the immune system as they age by increasing body levels of vitamin E and possibly other nutrients. 

● A new detector built by an ARS scientist and an Iowa State University chemist illuminates otherwise-unseen fecal 

contamination on meat and alerts meat packers to the contamination within seconds. Feces are the major source of 

bacterial contamination in livestock and poultry slaughterhouses. With the new device, which utilizes fluorescent 

spectroscopy, a contaminated carcass can be identified and then sanitized before the contamination spreads. 

● ARS scientists in the spring of 1998 kicked off a new national project to suppress the Formosan subterranean termite, 

starting in New Orleans. The termite is now established in more than a dozen States, costing $1 billion annually in 

repairs and control measures. An information site on the project can be found on the World Wide Web at 

www.ars.usda.gov/is/fullstop 

● New revved-up biodiesel fuels that start engines at cold temperatures down to 5 degrees F have been developed by 

ARS scientists. The research should help speed up the commercialization of biodiesel fuels—a boost for U.S. 

soybean growers and the environment. Cold has been a problem for biodiesel fuels because temperatures at or below 

freezing cause them to form solid, waxy crystals that block fuel lines and filters. The ARS scientists devised a threestep winterization process of mixing in additives, chilling the fuel, and filtering out solids. The research can help put 

biodiesel fuels into city buses, government and industry fleet cars, and underground mining equipment. The Federal 

Energy Policy Act requires 75 percent of all new State and Federal vehicles to be fitted for alternative fuels by the 

year 2001. 

Cooperative State Research, Education, and Extension Service

Mission

The mission of the Cooperative State Research, Education, and Extension Service (CSREES) is to achieve significant and 

equitable improvements in domestic and global economic, environmental, and social conditions by advancing creative and 

integrated research, education, and extension programs in food, agricultural, and related sciences in partnership with both the 

public and private sectors.

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1998 Annual Report of the Secretary/ ARP 6

USDA Grants To Boost U.S. Agricultural Competitiveness

USDA awarded $3 million in Risk Management Education Program grants to help farmers and ranchers compete in local 

and global markets. Some of the 17 grants give special attention to the needs of limited-resource farmers. The grants are part 

of a coordinated USDA risk management education and insurance protection program required by the Federal Agricultural 

Improvement and Reform Act of 1996.

USDA Celebrates 50th Anniversary of International Four-H 

Youth Exchange

More than 600 participants from 26 countries on 6 continents 

participated in the 7th World International Four-H Youth Exchange 

Conference in Washington, DC. Deputy Secretary Richard 

Rominger congratulated the participants on 50 years of intercultural 

understanding at the 50th anniversary celebration at the National 4-

H Center in Chevy Chase, Maryland. Participants attended 

workshops and interactive events, including an international bazaar, 

dinner at the U.S. Capitol, and an interfaith assembly.

Fund for Rural America Grants for Research, Education, 

and Extension

CSREES developed and carried out the $31.2 million 

competitive research, education, and extension grants 

component of the Fund for Rural America, awarding 115 

grants to organizations in 39 States. The grants support 

research, education, and extension projects that strengthen 

USDA agricul-tural, environmental, and rural development 

efforts and improve the quality of life for rural residents. In 

addition, the grants will help USDA improve delivery of services to underserved and poorly served farmers and other rural 

residents. 

USDA Grants $2.4 Million for Community Food Security 

CSREES awarded $2.4 million to 18 communities in 12 states to address local food, farm, and nutrition issues and help them 

become more self-sufficient in providing for their own food and nutrition needs. Many of the funded projects focus on 

helping communities meet the nutritional needs of low-income and elderly people. Some of the projects incorporate small 

business development, direct markets for local farms, and job training programs for youth.

USDA Water Quality Education Grants Target Underserved Communities

CSREES awarded more than $678,000 in USDA water quality education grants to help underserved communities make 

informed decisions about their water resources. The 17 grants are designed to help the communities improve water 

management, handle storm water, manage wastes, and protect or improve the quality of their water supplies.

USDA Reaches Out to Communities on the Year 2000 “Bug”

The Year 2000 (Y2K) “bug” affects every part of society. The Nation’s food supply sector is at risk due to heavy 

dependence on computerized processing and information exchange. CSREES created a Y2K Community Outreach 

awareness campaign, putting valuable Y2K information into the hands of the public through the vast Cooperative Extension 

Service network of educators and specialists. The Y2K toolkit gave producers a clear understanding of the implications of 

the Y2K problem, solutions, and strategies for assessing their own situations, and suggestions for creating contingency plans 

should systems fail.

Small Farm Digest: Valuable Resource

CSREES’ Small Farm Program works hard to improve the income and economic viability of small farms. One valuable 

resource for small farmers, introduced this year, is the Small Farm Digest, a quarterly newsletter distributed in print to more 

than 26,000 subscribers and also available via the World Wide Web. The newsletter highlights information from the national 

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USDA Celebrates National Research Initiative 20th 

Anniversary 

The USDA and the National Academy of Sciences celebrated 20 

years of competitive research grants in agriculture, recognizing 

USDA support for competitively funded research in fundamental 

and applied sciences important to agriculture. The introduction of a 

competitive research grants program at USDA in 1978 expanded 

the attention to fundamental sciences in agriculture and attracted 

high-quality scientists to study issues underlying agriculture. This 

CSREES program was expanded in 1991 to form the National 

Research Initiative in response to a National Academy of Sciences 

report, Investing in Research: A Proposal to Strengthen the 

Agricultural, Food, and Environmental System, and has served as a 

model for other competitive grants programs within USDA.

perspective, offers details of programs and resources 

available to small farmers, fosters discussion among small 

farmers, and presents success stories of small farmers to their 

peers.

Capacity Building Grants Awarded by USDA

Capacity building grants were awarded to support 42 teaching 

and research projects at historically black 1890 land-grant 

institutions and Tuskegee University. The $9.2 million 

program is designed to strengthen partnerships, promote 

workforce diversity, and enhance the institutions’ teaching 

and research programs in the food and agricultural sciences. 

Teaching projects will focus on innovative student 

recruitment and retention activities, develop new and updated curricula, and acquire cutting-edge instructional delivery 

systems and scientific instrumentation for teaching. Research projects will address critical issues of State, regional, and 

national importance in such areas as food safety, human nutrition, environmental sciences, biotechnology, and plant and 

animal sciences.

Tribal Colleges Receive USDA Extension Awards 

CSREES awarded nearly $2 million to 29 tribal colleges under USDA’s New Tribal Colleges Extension Program. The 

program supports training and education in a wide variety of areas, including production agriculture; business management; 

community and family development; 4-H and youth leadership; natural resources and conservation; and nutrition, diet, and 

health. 

Economic Research Service

Mission

The mission of the Economic Research Service is to provide economic analysis on efficiency, efficacy, and equity issues 

related to agriculture, food, natural resources, and rural development to improve public and private decisionmaking.

Accomplishments 

Following are some key accomplishments of the Economic Research Service for FY 1998:

Implications of Regional Trade Agreements and the World Trade Organization

An ERS report, Regional Trade Agreements and U.S. Agriculture (AER-771), analyzes RTA’s and concludes that U.S. 

agriculture can benefit from participating in them and may lose when it does not participate. Agriculture is an important 

source of potential U.S. gains from RTA’s.

Asian Financial Crisis

ERS conducted several analyses during 1998 of the implications for U.S. agriculture of the rapidly changing Asian economic 

and financial conditions. The potential scope and impact of the Asian financial crisis was first summarized in Agricultural 

Outlook (AGO-248). The initial assessment provided the analytic base for reassessing the Department’s short and 

intermediate outlook for U.S. agriculture and trade and allowed for more informed private and public decisions relative to 

the Asian crisis and its linkage to U.S. agriculture.

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Effects of Prices and Income on Food Choices

Economic factors such as food prices and consumer income are important determinants of food choices, with potential 

consequences for nutrient availability. An ERS report, How Economic Factors Influence the Nutrient Content of Diets (TB1864), provides estimates of how the availability of 28 nutrients would change as consumers alter their food purchases in 

response to changes in food prices and income through the interdependent food demand relationships. Estimates of nutrient 

income responses can also be a starting point in evaluating possible effects of income changes on dietary quality when food 

stamp benefits are cut or increased.

Sustainability in the Great Plains

ERS published a variety of research perspectives on economic sustainability in the Great Plains in a special issue of USDA’s 

Rural Development Perspectives focusing on issues related to building a sustainable economy in the rural Great Plains. The 

research effort emphasized the effects of 1996 farm legislation, the long-term decline of population, changing linkages 

between net migration and natural amenities and suburbanization, the needs of manufacturing firms, distress in the 

retail/wholesale sector, and the potential effects of Federal programs in the region.

Highlighting the Performance of America’s Food System

ERS provides needed research and information to assess the ability and performance of the Nation’s food system to deliver 

safe and nutritious food at reasonable prices. The broad and inventive research program provided information to Federal 

policy officials on demographic, social, and economic determinants of diet quality; the costs of poor diets; and the benefits 

of improving diets and nutrition; thereby highlighting the importance of know-ledge and health education in shaping 

consumers’ diets. 

Enhanced Understanding of Farms and Rural America

ERS tracks and explains the changes being experienced on farms and in rural America. Such structural information about 

farms and rural communities is particularly important in showing the heterogeneity of farms and businesses that comprise 

the economic landscape of rural areas. As a result, the Secretary’s National Commission on Small Farms relied heavily and 

almost exclusively on ERS information for the factual basis that was used to augment, validate, or refute impressions and 

beliefs about the situation and problems of small and minority-operated farms out of which the Commission prepared 

recommendations. 

Information generated by ERS is particularly important for policymakers as they deal with small or disadvantaged farms, 

minority farmers, and the impacts of market and natural events. For example, ERS developed a new economic typology to 

characterize farms by linking primary occupation of the farm operators and their stage of career to value of production as a 

way to understand unique needs. In another example, ERS research on rural and agricultural credit markets has been used to 

assess the impact of proposed changes in USDA’s farm loan programs.

National Agricultural Statistics Service 

The mission of the National Agricultural Statistics Service (NASS) is to serve the basic 

agricultural and rural data needs of the people of the United States, including those working in 

agriculture and those living in rural communities, by objectively providing important, usable, and 

accurate statistical information and services for informed decisionmaking.

1997 Census of Agriculture

In 1998, NASS conducted the census of agriculture for the first time. The transition of the census from the Bureau of the 

Census went very smoothly, even though the census of agriculture program was transferred to NASS midway through the 

planning cycle. Several noteworthy improvements were implemented which resulted in a higher response rate and release of 

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Web Stats for Kids 

A new feature was added to the NASS home page, NASS Kids. 

This educational site for young people uses a light-hearted 

approach to agriculture, statistics, and math. Users are escorted 

through the site by “Stanley Statistician” and “Pie-Chart Pam.” 

Among the NASS Kids features are a NASS IQ page, online 

coloring book, history trivia quiz, games, and links to other 

agricultural sites such as Ag in the Classroom. The page also offers 

answers to some commonly asked questions such as “What is a 

statistician?” and “What are charts and graphs?” The NASS Kids 

page was selected by Bonus.com, the SuperSite for Kids, as an 

“excellent site” and the site requested permission to link to it. The 

mission of Bonus.com is to provide access to a rich selection of 

entertaining and educational works on the Web that educators may 

use in the classroom and that children will learn from and enjoy. 

The NASS site also received several other awards during 1998.

the results 10 months earlier than the previous census.

Dairy Products Prices

NASS implemented the Dairy Products Prices survey in 

September 1998 to collect prices for nonfat dry milk, butter, 

and dry whey. These price data are published weekly along 

with the ongoing cheese price series. The cheese price is the 

major component in the current milk price support formula 

(Basic Formula Price) that determines the minimum prices 

that plants can pay producers for milk. Under the proposed 

new formula, all of the above product prices would be used in 

the milk price support formula.

International Agricultural Statistics Conference 

NASS hosted the first International Conference on Agricultural Statistics, sponsored by the International Statistical Institute.

Presentations and discussions focused on future needs for agricultural information, as well as new developments in 

technology and statistical survey methodology that will be required to meet those needs. The March 1998 conference, 

attended by over 250 participants from 50 countries, was deemed highly successful and brought NASS and USDA 

recognition for its leadership in promoting improved agricultural statistics throughout the world.

International Assistance Provided 

NASS provided technical assistance and training to improve agricultural statistics programs in 12 countries. A 

NASS staff member continued a 2-year residency assignment in Ethiopia, and short-term assignments 

supported work in Chile, China, Ecuador, Ethiopia, Kazakhstan, Mexico, Morocco, Nicaragua, Romania, 

Russia, Ukraine, and Venezuela. This technical assistance helps these countries improve agricultural data 

collection efforts, primarily through improved sample survey methodology. In addition, NASS’ International 

Programs Office coordinated and/or conducted training programs in the United States for 158 visitors representing 22 

countries.

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FY 1998 Annual Report of the Secretary of Agriculture

USDA: Preparing for a New Millennium 

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7. Promoting Quailty and Fair Trade Through Marketing and Regulatory Services

Mission

The mission of Marketing and Regulatory Programs is to facilitate the domestic and international marketing of U.S. 

agricultural products and to ensure the health and care of animals and plants while improving market competitiveness and 

the economy for the overall benefit of both consumers and American agriculture.

Efforts To Improve Oversight of Livestock Concentration

High concentration, forward sales contracts, production contracts, and vertical integration have raised major concerns about 

competition and trade practices in livestock and procurement by meat packers and poultry processors. The Packers and 

Stockyards (P&S) program of the Grain Inspection, Packers and Stockyards Administration (GIPSA) is restructuring its 

headquarters and field offices to better focus on its core responsibilities—overseeing competition, trade practices, and 

payment protection. Eleven field offices have been consolidated into three regional offices. P&S is also incorporating 

economic, statistical, and legal expertise into investigations at the field office level to increase effectiveness in investigating 

anticompetitive practices and enforcing trade practice and payment protection.

Challenge to IBP’s Livestock Buying Method, Right of First Refusal

In August 1995, P&S filed a complaint alleging that IBP, Inc.’s use of an agreement to 

purchase cattle violated the Packers and Stockyards Act because the agreement was an 

unfair practice and gave unreasonable preference to a small group of Kansas feedlots 

by guaranteeing them the highest price paid for cattle in Kansas. The Chief 

Administrative Law Judge ruled that IBP’s use of the agreement was not an unfair 

practice.

P&S appealed the Administrative Law Judge’s decision to USDA’s Judicial Officer 

(JO). However, the JO ruled that IBP’s use of the agreement was not an unfair practice 

because the evidence did not prove that other feedlots or producers were harmed by the 

agreement. In addition, the JO ruled that the right of first refusal given to IBP under the 

agreement has the effect of reducing competition, and is, therefore, an unfair practice. 

IBP appealed the JO’s decision to the United States Court of Appeals for the Eighth Circuit.

Hog Procurement Investigation

USDA released the results of the Western Cornbelt Hog Procurement Investigation, recently completed by GIPSA. The 

investigation revealed substantial differences in hog characteristics and prices among pricing and procurement methods and 

seller sizes. Hogs sold on the spot market, hogs sold on a live-weight basis, live-weight pricing, and hogs sold by smaller 

sellers tended to exhibit lower hog quality characteristics and received lower prices. Price comparisons indicated that 

publicly reported prices did not reflect actual purchase prices. 

Orders Issued and Penalties Assessed 

Over the past 3 years, 115 decisions and orders have been issued against 183 individuals and firms for violating the P&S 

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Act. The orders included more than $366,380 in civil penalties and 314 cease and desist provisions involving unfair trade 

practices or anticompetitive activities. 

Farmers Markets

Secretary Glickman joined local officials and 31 vendor-farmers 

July 2 to kick off the first USDA farmers market of the season. The 

Secretary encouraged Americans to eat more fruits and vegetables 

and announced the results of USDA’s Healthy Eating Index. He 

also praised the increase in farmers markets–a 35-percent rise in the 

number of farmers markets across the country since USDA began 

collecting statistics in 1993, and their benefits to consumers and 

small farmers.

New Toll-Free Number for Livestock Marketing 

Complaints

GIPSA established a toll-free number (1-800-998-3447) to 

allow producers and the general public to file complaints and 

report market abuse.

New Technology To Measure Grain Moisture

GIPSA implemented a new official grain moisture meter, which marks a transition to new technology for moisture 

measurement for the official grain inspection system. The new meter offers increased speed and reliability.

Testing Services for Corn Oil, Protein, and Starch

As part of GIPSA’s efforts to keep pace with an increasingly sophisticated market that requires end-use quality information, 

it began offering a new testing service for corn oil, protein, and starch.

Opening Markets and Keeping Them Open

APHIS supports agricultural trade by providing our trading partners with scientific data indicating that U.S. products are free 

of pests and diseases of concern and ensuring that any trade restrictions placed on our products are based on sound science. 

As a result of these efforts, APHIS played a key role in removing 77 foreign trade barriers in FY 1997. U.S. agricultural 

producers can now ship tomatoes to Japan; table grapes to China; lemons, kiwis, oranges, and grapefruit to Chile; sweet 

cherries to Mexico; live swine to Argentina and Peru; and rough rice to Ecuador. Annually, these new markets have been 

responsible for enabling $2.2 billion in threatened and new agricultural trade opportunities to take place. 

GIPSA worked with APHIS and the Foreign Agricultural Service to convince Sanidad Vegetal (the Mexican plant 

quarantine authority) to suspend implementation of two new regulations that would have halted exports of U.S. wheat and 

sorghum to Mexico for potential Tilletia controversa (Kuhn). 

Efforts Against Alien Invasive Species 

Recently, infestations of the Asian long-horned beetle–a highly destructive pest of maple and other hardwood trees–have 

been discovered in New York and Illinois. The introduction of this pest underlines the need to coordinate efforts to combat 

such introductions

APHIS is cooperating in Vice President Gore’s Alien Species Initiative, a program initiated in June 1997 to create a national 

strategy regarding the introduction of alien invasive species. More than 20 Federal agencies have some role in dealing with 

invasive plant and animal pests, which are estimated to cost U.S. agriculture more than $12 billion per year. Now, these 

agencies are coordinating their efforts through a National Invasive Species Council, which is currently working with State, 

local, and tribal governments. 

Control and Eradication Efforts 

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California Egg Partnership Wins Hammer Award

The California egg industry worked together with the California 

Department of Food and Agriculture, USDA’s APHIS and 

CSREES, FDA’s Los Angeles District, and the California 

Department of Health Services to develop a quality assurance plan 

that will ensure the highest quality and safety of eggs. Before this 

plan, there was no uniformity in the production of fresh eggs in 

California in these areas: rodent control, formal education or 

training in rodent control, or biosecurity. The California Egg 

Quality Assurance Plan is comprehensive and implements 

important provisions to protect the public health. There are 

guidelines for transportation, purchasing chicks, cleaning cages, 

and monitoring rodents. A multifaceted health plan covering 

medication and feeding is included in the certification program. 

The important steps of wash water and refrigeration are addressed. 

For employees, training and recordkeeping help ensure that 

employees are equipped and prepared to maintain quality and food 

safety. This plan demonstrates what can happen when Federal/State 

regulatory agencies and private industry work together toward a 

common goal.

APHIS is responsible for protecting U.S. agriculture from 

outbreaks of exotic animal and plant pests and diseases. For 

example, the Mediterranean fruit fly (Medfly) is one of the 

most devastating pests. After detections of the Medfly in 

Florida, APHIS joined State and local counterparts in a largescale eradication effort. Due to this effort, no Medflies have 

been detected in Florida since FY 1998. 

APHIS has had success working with State and local 

cooperators on three major animal disease eradication 

programs: brucellosis, tuberculosis, and pseudorabies. 

Currently, 43 States, Puerto Rico, and the Virgin Islands have 

been recognized by the State-Federal brucellosis eradication 

program as brucellosis-free, and 45 States and the Virgin 

Islands are accredited free of bovine tuberculosis. While only 

31 States are currently free of swine pseudorabies, APHIS 

expects to achieve total eradication of this disease by the end 

of the year 2000.

Yellowstone Bison 

APHIS has been actively involved with other Federal and State agencies in efforts to resolve the problems associated with 

the brucellosis-infected bison herd in Yellowstone National Park. The goal of these efforts is to reduce the potential for 

transmission of brucellosis from infected bison to livestock and disease-free bison and elk populations in the area. 

To determine a long-term strategy for the bison, a draft environmental impact statement (EIS) was published in June 1998 

with the Department of Interior’s National Park Service, USDA’s Forest Service, APHIS, and the State of Montana as 

signatories. APHIS officials have finalized a brucellosis quarantine protocol for Yellowstone bison; animals that are certified 

free of brucellosis under this protocol will be able to be released to Native American tribes, parks, preserves, or other 

appropriate recipients. . 

Reduction in Fees

Cotton growers are paying less for cotton classification services than they did a few years ago. Through office 

consolidations, automation, improved automatic data handling, and the rapid utilization of newly developed equipment with 

lower labor requirements, the cotton classification fee for the 1998 crop is $1.30. In 1994 the fee was $1.80.

Bison Now Part of Food Purchase Program

Secretary Glickman’s April 30 authorization of up to $2.5 million to purchase ground bison helped to reduce the large 

inventories.

Agricultural Marketing Service (AMS) Reaches Out to Small and Minority Vendors

In September 1998, 22 small firms representing a diverse cross section of more than 400 small meat, poultry, and fruit and 

vegetable processors and dealers were invited to a USDA workshop to explore ways to increase small business participation 

in USDA’s purchase programs.

Promoting Farmers Markets

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Finding a farmers market whether in your State or in another State is as easy as flipping the pages of the 1998 National 

Farmers Market Directory. The list of 2,746 farmers markets operating throughout the United States provides a 

comprehensive summary of market locations and hours of operation.

Let Your Fingers Do the Walking to the Farmers Market

Finding a farmers market on Federal property is as easy as dialing the farmers market hotline. By calling 1-800-384-8704 

farmers, vendors, customers, and market cooperators may obtain recorded information on dates, times, directions, and other 

information about participating in USDA-sponsored markets on Federal property.

Eggs-tra Eggs-tra

The poultry and egg industry is reading all about a wide range of supply, demand, and price information as well as market 

comments about international marketing of poultry and eggs in a new weekly poultry market news report. The weekly 

International Egg and Poultry Review is available every Tuesday on a subscription basis by facsimile transmission and free 

on the Internet.

$1.2 Million in Projects

Through AMS’ Federal State Marketing Improvement Program, USDA awarded $1.2 million for 24 projects in 18 States in 

FY 1998. This will allow State agencies to conduct a wide range of research and service projects aimed at improving the 

marketing, distribution, and use of agricultural products.

One-Stop Shopping

Members of the produce industry seeking several market news reports can now visit the Market News Customer Service 

Center in Fresno, California. The Customer Service Center provides customers with consistent reports that are provided in a 

timely manner.

Small farmers now have a one-stop information source for AMS farmer direct marketing activities. The website, 

www.ams.usda.gov/directmarketing, provides State contacts and links to appropriate Federal, State, university, and other 

websites relating to direct marketing.

RuleMakingMadeEasy.Gov

USDA is a 1998 recipient of the Government Technology Leadership Award. The award is for AMS’ use of the Internet and 

other communication technology in handling more than 280,000 comments received on its proposed rule for the national 

organic food and fiber standards.

People interested in marketing order information and Perishable Agricultural Commodities Act (PACA) information can 

view proposed rulemaking actions and electronically mail comments from both sites. Marketing Order information is 

available at www.ams.usda.gov/fv/modocketlist.htm and PACA information is available at www.ams.usda.gov/fv/paca/proregs.htm

Exporting Dairy Products

U.S. exporters to the European Union (EU) who ship cheese, ice cream, and other dairy products, as well as U.S. 

manufacturers who ship pizza, cheese crackers, cheese cake mixes, and other processed foods that contain dairy ingredients, 

will benefit from a new AMS certification program. AMS and a team of dairy industry representatives developed a 

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comprehensive certification program that satisfies the European Commission’s equivalency requirements for dairy products 

exported to the European Union. Since April 1997, more than 2,000 certificates have been issued, enabling 35 million 

pounds of U.S. dairy products to enter the EU.

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FY 1998 Annual Report of the Secretary of Agriculture

USDA: Preparing for a New Millennium 

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8. Providing Administrative Support to the Department and Its Clients

Office of Inspector General

Mission

The Office of Inspector General’s (OIG) mission is to conduct and supervise audits and investigations to prevent or detect 

fraud and to improve the effectiveness of USDA programs by recommending changes that will increase efficiency and 

reduce wasteful and fraudulent activities.

Secretary Receives Civil Rights Award

On February 17, on behalf of all 18 of the 1890s land-grant colleges 

and universities, the president of Langston University presented 

Agriculture Secretary Dan Glickman with an award recognizing his 

leadership on civil rights issues at USDA.

Recoveries and Savings

In FY 1998, OIG identified $63.9 million in recoveries and 

collections and $48.6 million in fines and restitutions. OIG 

also identified $39.5 million in questioned costs that cannot 

be recovered. Another $127.9 million was identified for which management made commitments to put funds to better use. 

OIG efforts also resulted in 777 criminal indictments and 604 convictions.

Multimillion-Dollar Food Stamp Trafficking Cases Cracked in 

Several States

OIG cracked multimillion-dollar food stamp trafficking cases in 

several States. Twenty-four individuals have been arrested in the 

southern district of New York on an estimated $60 million food 

stamp fraud and money laundering conspiracy. During a 2-year 

investigation in Philadelphia, Pennsylvania, an elaborate scheme 

was uncovered involving $15 million of food stamp trafficking and 

money laundering. Also in Philadelphia, the owner of four retail 

stores pled guilty to fraudulently purchasing approximately $5.4 

million in food stamps and laundering $4.8 million in funds. In 

Georgia, a grocer was sentenced to serve 5 years in prison and 

ordered to pay over $3.9 million in restitution after he pled guilty to 

charges of money laundering and redemption of illegally received 

food stamps.

Operation Talon Shows Continued Success in 

Apprehending Fugitives From Justice

Operation Talon is a Presidential initiative designed to locate 

and apprehend fugitive felons, many of them violent 

offenders, who are current or former food stamp recipients. 

Operation Talon has been expanded to include 34 

metropolitan areas in 23 States, and 3,206 fugitive felons had 

been arrested as of September 30, 1998.

Presidential Initiative in the Child and Adult Care Food 

Program (CACFP) Continues With Operation “Kiddie Care”

Operation “Kiddie Care” continues to detect fraud committed 

by CACFP sponsors around the country; as of September 11, 1998, 53 sponsors in 23 States were being audited or 

investigated. As part of Operation “Kiddie Care,” 13 sponsors have been terminated from CACFP. These 13 had been 

receiving $24.2 million in program funds annually.

Office of Chief Financial Officer

Mission

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quality financial and performance information to make and implement effective policy, management, stewardship and 

program decisions.

National Finance Center Achieves Year 2000 Compliance Goal 

OCFO’s National Finance Center (NFC) in New Orleans met a self-imposed deadline to make all its systems Year 2000 

compliant. The NFC provides payroll/personnel services to 435,000 employees from USDA and 100 other Federal agencies, 

accounting for one-fifth of the entire Federal Government. NFC’s systems include the Federal Government’s Thrift Savings 

Plan, which is the $67 billion 401(k) retirement plan with 2.3 million participants.

Reaching Out to Small and Minority Businesses

USDA’s Office of Small and Disadvantaged Business Utilization 

participated in the Florida Black Business Board’s Second Annual 

“Black Business Investment Day” March 13 in Tallahassee, 

Florida. It also participated in a workshop March 16 in Wilson, 

North Carolina, on “Doing Business With Your Government.”

OCFO’s National Finance Center Marks Civil Rights’ 

Progress 

OCFO’s NFC unveiled Inclusion University, a self-paced 

optional program for employees who want to expand their 

understanding of diversity issues in the workplace. An NFC 

original, this program is the first of its kind in the Federal Government. This effort and other initiatives contributed to a 36-

percent decline in informal EEO complaints and a 41-percent decline in formal EEO complaints.

USDA Increases Debt Collection by 45 Percent in FY 1998 

USDA collected $78.3 million in delinquent debt for the first 9 months of 1998 from the Tax Refund Offset Program 

(TROP) and Treasury Offset Program (TOP). This figure exceeds the $53.7 million collected during the same period in 1997 

by about 45 percent. 

Office of the Chief Information Officer

Mission

The mission of the Office of the Chief Information Officer (OCIO) is to strategically acquire and use information technology 

resources to improve the quality, timeliness, and cost effectiveness of USDA service delivery to its customers. The following 

accomplishments reflect the OCIO’s efforts to achieve that mission.

USDA Workshop Focuses on Working Effectively With 

American Indians

One of USDA’s Native American liaison officials served as 

instructor the week of August 2 at a workshop on “Working 

Effectively with American Indians” in Lac du Flambeau, 

Wisconsin, to improve the delivery of USDA conservation 

programs to this historically underserved group.

USDA Makes Progress in Addressing “Year 2000” 

Problem

USDA launched an aggressive in-house and outreach 

program to address Year 2000 computer and embedded chip 

problems and to ensure the uninterrupted delivery of its 

programs and services. These include food stamps to some 25 

million Americans, loans and payments to millions of farmers, child nutrition programs, and programs to promote 

agricultural trade and to protect the environment. USDA identified 643 “mission-critical” systems: at the end of the fiscal 

year, 502 or 78 percent of those systems were Year 2000 compliant. Ninety-four percent of the 332 systems undergoing 

repair met the renovation milestone date. OCIO’s National Information Technology Center (NITC)—which provides 

information management services and technology to support USDA agencies, the Federal Aviation Administration, and 

other agencies—successfully migrated its mainframe computer system to a Year 2000 compliant operating system. In 

addition, USDA leads the Food Supply Working Group of the President’s Council on Year 2000 Conversion—raising 

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awareness and working with industry partners to address potential Y2K- related problems in the farm-to-table food supply 

chain.

OCIO’s National Information Technology Center Helps 

Agencies Fight Fires, Research Plants

OCIO’s National Information Technology Center (NITC) 

continued to improve the ability of USDA agencies to deliver 

critical programs and services. For example, new technology 

“platforms” will improve the Forest Service and other land 

management agencies’ ability to report risks, including fires, 

hurricanes, and floods; access up-to-the-minute weather 

information; and manage crews on the front lines. The system will 

include Internet access, maintenance of historical data, and 

enhanced reporting capabilities. Key improvements have also been 

made in the “Plants” website. Developed by USDA’s Natural 

Resources Conservation Service, the Plants site now serves 

approximately 40,000 users every month, providing field office 

employees, academic researchers, farmers, businesses, and average 

citizens a single source of standardized information about plants.

“One-Stop Service” for Customers Moves a Step Closer to 

Reality

USDA purchased the first increment of new technology 

required to fulfill our promise of providing “one-stop service” 

for farmers, ranchers, and customers of rural development 

programs. This historic milestone represents an important 

first step in moving away from “stove pipe” service delivery 

toward a shared information system for USDA’s farm, 

conservation, and rural development agencies. When the 

“Common Computing Environment” is complete, customer 

benefits and payments will be processed electronically, and 

much faster; customers will no longer have to provide the 

same information to different USDA agencies because they 

will share a common data base; customers will be able to 

access program information and apply from home; and the paperwork burden on USDA customers will be significantly 

reduced. USDA employees, freed from no-value-added work, will have more time to provide direct assistance to customers.

Office of the Chief Economist

Mission

The mission of the Office of the Chief Economist (OCE) is to advise the Secretary of Agriculture on the economic prospects 

in agricultural markets and the economic implications of policies, programs, and economic events affecting U.S. agriculture 

and rural communities; to ensure the public has consistent, objective and reliable agricultural forecasts; and to promote 

effective and efficient rules governing Departmental programs. OCE was created by the Secretary under the authority of the 

Federal Crop Insurance Reform and Department of Agriculture Reorganization Act of 1994, Public Law 103-354.

OCE consists of the Chief Economist and Immediate Staff, the Office of Risk Assessment and Cost-Benefit Analysis, the 

Global Change Program Office, and the World Agricultural Outlook Board. Three major functions are carried out by OCE: 

(1) economic intelligence, policy, and program coordination, which includes farm labor, small farms, sustainable agriculture, 

global change, and energy activities; (2) agricultural estimates and projections; and (3) regulatory analysis.

Small Farms Commission Report

On January 22, 1998, Secretary Glickman accepted the report of the 

Small Farms Commission, which was formed in response to a 

recommendation by USDA’s Civil Rights Action Team. The report 

contained 146 recommendations. Deputy Secretary Rominger was 

named to lead an interagency team to develop an integrated 

Departmental strategy to help small farmers.

Accomplishments

In the face of growing concern about agriculture-related 

hazards to human health and the environment, the 

Department is applying sophisticated new techniques to 

pinpoint risks and options for reducing them. In the past year, 

the Office of Risk Assessment and Cost-Benefit Analysis 

provided technical support for USDA risk assessments for Salmonella in eggs, irradiation of beef, pests in wood pallets 

imported from China, foot-and-mouth disease in beef from Argentina and South Africa, and hog cholera in Mexico. Costbenefit analysis also helps monitor the impact and effectiveness of new programs. USDA is undertaking case studies to 

determine the efficacy of the Environmental Quality Incentives Program and the Conservation Reserve Program.

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USDA is making sure that U.S. agricultural concerns about climate change and efforts to mitigate it are heard as the world 

community decides how to implement the 1997 Kyoto Accords. Risks associated with climate change and climate variability 

such as temperature and precipitation changes, as well as an increase in extreme weather events, could have a big impact on 

agriculture, forestry, and rural areas. The Department’s Global Change Program Office has been an active member of the 

U.S. delegation at meetings on the U.N.-sponsored Accords and has taken part in other domestic and international climate 

change activities.

In the past year, USDA used scientific analysis to challenge claims by China and Brazil that U.S. wheat would spread fungal 

diseases. USDA scientists and meteorologists presented evidence demonstrating that neither country has climatic conditions 

that support the spread of TCK smut or karnal bunt. This information greatly weakened the arguments for banning U.S. 

wheat imports. Brazil recently removed TCK smut from its list of quarantined diseases that block imports and has announced 

it will permit imports of hard red winter wheat grown in seven U.S. States. 

USDA is working with the National Weather Service (NWS) to ensure that agriculture’s essential data needs can be supplied 

despite cutbacks in NWS specialized weather services. As the first step in developing a national agricultural weather 

observing network, OCE’s World Agricultural Outlook Board has stationed the first field meteorologist for the network at 

the Agricultural Experiment Station in Stoneville, Mississippi, re-opening this former NWS site.

In addition, USDA acquired access through the Department of Defense to more than 10,000 satellite images which are 

available at no cost and which potentially represent a cost savings of $400 to $4,400 per image. Departmental agencies use 

satellite imagery to manage forests, monitor natural resources, forecast crops, and conduct farm programs.

USDA Readies Puerto Rico Summer Internship Program

USDA’s Farm Service Agency cosponsored an internship program 

for the Puerto Rico USDA Center of Excellence for Hispanic 

Americans in the summer of 1998, employing seven college 

students to work at the FSA Puerto Rico State office.

Under the auspices of the United States/South Africa BiNational Commission, USDA’s World Agricultural Outlook 

Board has been showing South Africa how to forecast the 

impact of its highly variable climate on crop production. The 

Board arranged for a technical exchange between the 

developers of the Oklahoma “Mesonet” and scientists representing South Africa’s Agricultural Research Council. In return, 

we now receive real-time weather data collected by South African counterparts.

Similarly, an ongoing information exchange with China has yielded substantial analytical benefits. The Department’s 

economic and statistical agencies are helping China improve agricultural data collection and statistical practices at the local 

level. Through participation in this project, USDA has substantially improved its information base with respect to the present 

and future of China’s agricultural sector.

Departmental Administration 

Mission

Departmental Administration’s mission is to provide the most effective and efficient administrative management leadership 

and services to support USDA agencies and enable the Department to reach its programmatic goals.

Bringing Rural America Venture Opportunities (BRAVO)

The Office of Small and Disadvantaged Business Utilization (OSDBU), in concert with its USDA partners, initiated the 

BRAVO Program. BRAVO will establish partnerships with American Indian and Alaska Native tribes, 1890 and 1994 

institutions, Hispanic American colleges and universities (HACU), small disadvantaged companies, private corporations, 

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and government organizations to revitalize and enrich targeted rural communities. 

USDA Purchase Card and Fleet Card Consolidation A Success

On August 7, 1998, USDA awarded a task order to NationsBank to replace the current purchase card and fleet card service 

contracts. This award provides streamlined credit card services to the cardholders of USDA, and utilizes the state-of-the-art 

Purchase Card Management System (PCMS) allowing USDA employees to buy goods and services faster and at lower 

administrative costs. PCMS, upon full deployment, will offer approximately 18,000 purchase cardholders and 40,000 fleet 

cardholders an on-line reconciliation system that eliminates monthly statement and invoice processing, provides improved 

management oversight, demonstrates a user-friendly environment, and offers administrative cost avoidance savings in the 

coming years. 

USDA Joins Executive Order 13101

The President issued Executive Order 13101, “Greening the Government through Waste Prevention, Recycling and Federal 

Acquisition,” to strengthen the environmental policies of the Administration. USDA joined in this current initiative with its 

own biobased products to be promoted as environmentally preferable products. For the first time, USDA will attempt to link 

rural job growth, agricultural production, and the use of agricultural waste products to the sale of environmentally preferable 

products.

Vice President’s National Performance Review, Silver Hammer 

Awarded to the Office of Operations (OO) 

OO, in cooperation with the Rural Utilities Service and the Office 

of the General Counsel, was awarded the Silver Hammer Award for 

reinvention of the cooperative utility loan program. The average 

turnaround time for loans was reduced from 6 months to 2 weeks. 

OO reduced the printing lead time from 5 days to 22 minutes using 

print-on-demand technology. This expedites loan services to USDAsupported cooperative utilities and improves their services to their 

rural customers.

Contracts Mean Jobs for Persons with Disabilities

USDA achieved its strongest results to date providing a wide 

variety of jobs to persons with disabilities. Under the JavitsWagner-O’Day Act Program, USDA created more than 75 

new full- time jobs for persons with disabilities. The single 

largest contract of the year provided more than 60 jobs 

performing the facilities management services at USDA’s 

new Beltsville Office Complex. More importantly, this 

contract is a hallmark action, being the first Commercial 

Facility Manager that has been awarded to a Community Rehabilitation Program by the Federal Government, opening a new 

service industry with potentially hundreds of jobs nationwide. 

Complaint Backlogs Continue To Be Reduced

Progress was made on reducing the backlog for both program complaints and EEO complaints. By October 31, 1998, 479 

program complaints had been closed out of the 1,088 that were active at the start of the year. On the EEO complaint side, 

806 were closed out of the 1,523 that were active at the start of the year. 

Major Program Complaints Resolved 

Ten farm program discrimination complaints were resolved with findings of discrimination, and significant remedies were 

negotiated. As a result, debt write-off and expenses for these cases totaled $1,055,248 and compensatory damages awarded 

in these cases totaled $1,804,725.

Beltsville Office Facility—An Award-Winning Facility

The new Beltsville Office Facility received a Federal Energy Saver Showcase Award from the Department of Energy. The 

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award recognizes Federal facilities operating at their peak efficiency by using energy resources wisely. A Certificate of 

Merit for Excellence in Construction was received on September 16, 1998, from the Associated Builders and Contractors, 

Inc. The September 1998 issue of Building Design and Construction magazine includes a positive article on the success of 

the complex and the innovative procurement process.

Office of Operations (OO) Is Recognized by the National Institute of Building Sciences 

For the headquarters buildings in Washington, DC, OO was recognized by the National Institute of Building Sciences, a 

nongovernmental, nonprofit organization authorized by Congress to encourage and accelerate the introduction of existing 

and new technology into the building process. An article in the publication “Excellence in Facility Management—Five 

Federal Case Studies” recognized the challenges faced in maintaining beautiful, old, and historically significant buildings 

and commended USDA for its Energy Management Program and for “going the extra mile” for the betterment of the 

facilities.

USDA Acquisition Toolkit Provides Innovative Web 

Technology to User Community

USDA deployed its Acquisition Toolkit via the Internet on March 

27, 1998, offering users substantial time savings in the procurement 

process. One tool (direct access to the Department of Labor Service 

Contract and Construction wage determinations) gives agency 

procurement personnel immediate access to wage determinations 

that can be incorporated as official determinations in contract 

solicitations. Downloading time for this system averages 5 minutes. 

Previously, acquisition personnel had to request such 

determinations manually with administrative lead times averaging 

30 days. This new Toolkit offers the users and customers of the 

USDA acquisition community a suite of tools selected from 

commercial and government acquisition solutions. The USDA 

Acquisition Toolkit can be found on the USDA Procurement Home 

Page at www.usda.gov/da/procure.html 

Welfare to Work (W2W) Goal

USDA’s OHRM has Departmentwide leadership 

responsibility to develop and implement this Welfare to Work 

(W2W) Presidential Initiative. USDA works with the 

National Performance Review (NPR) and Office of Personnel 

Management (OPM) to refine the requirements of the 

initiative, identify barriers and challenges, and develop 

appropriate regulations. In less than 3 years, USDA has hired 

374 employees under this initiative. This number for 1999 is 

just one less than the goal of 375 hires by the end of fiscal 

year 2000. Not only is USDA committed to helping welfare 

recipients obtain employment, USDA is committed to helping 

hired employees advance. For example, Marketing and 

Regulatory Programs (MRP) established a website of W2W 

contacts for Federal, State, nonprofit, and community-based organizations to assure wide distribution of MRP’s vacancy 

announcements. MRP has hired more than 100 former welfare recipients. Rural Development brings employees in at the GS3 level, then provides training and experience leading to the GS-7 level.

USDA Creates Departmental Office of Ethics

An Office of Ethics was established under the Assistant Secretary for Administration to support and oversee ethics training, 

counseling, and financial disclosure throughout the Department. Among other start-up activities, this office is engaged in 

developing new, more efficient means of reaching USDA employees worldwide with guidance regarding the executive 

branch-wide Standards of Conduct, the criminal code on conflicts of interest, and the Hatch Act rules governing political 

activity by government employees. 

USDA Establishes a Conflict Resolution Center

A USDA Conflict Prevention and Resolution Center was established in March 1998. This office is charged with promoting 

effective conflict management practices to address disputes with customers and employees. The center’s emphasis will be on 

providing education to develop conflict resolution skills, as well as greater use of alternative dispute resolution techniques to 

resolve disputes quickly and inexpensively.

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