tance of this research to the rice industry. Thus we are grateful that the Federal Government, through the Department of Energy, has taken a leadership role in helping us to advance our goal of turning the rice straw disposal problem into a new source of clean-burning, renewable liquid fuel for our State and Nation. The technologies that will be demonstrated at the Gridley ethanol plant will have applicability throughout rice-growing regions of the country as well as in other agricultural areas of the nation. These technologies will be applicable to corn fiber, for example. The lessons learned at the Gridley plant will help us understand the best ways to turn other agricultural byproducts into liquid fuels that will benefit rural economies as well as the environment. This pilot project is an introduction to the limitless potential of bio-refining. While we are confident that we can demonstrate a cost-effective technology that can be replicated elsewhere with limited or no Federal support, we believe that there is an important role for the U.S. Department of Agriculture in initiatives like the Gridley ethanol plant. Specifically, we recommend that USDA be authorized to provide financial support to help develop and demonstrate more cost effective and safe methods for collecting, storing and transporting rice straw and other similar agricultural byproducts intended for use as feedstock for ethanol production. Driving down the cost of collecting, storing and transporting rice straw will help improve the economic viability of ethanol production from this and other agricultural byproducts. In addition, it will help ensure our growers who produce rice receive the greatest possible benefit from the development of this important rice straw disposal technology. The need for safer storage methods was highlighted this past year when 4,000 tons of rice straw intended for use in a test facility burned uncontrollably after being ignited by vehicle exhaust. We must be able to protect the asset once it is collected from the fields after harvest and prior to its use in the ethanol making process. The development of safe, cost-effective collection, storage and transportation technologies and systems are critical to rice growers and the long-term viability and reliability of ethanol production from rice straw. On behalf of this important new industry to rural America, our experience also suggests that the committee should consider providing some form of federallybacked credit enhancements to help promote private sector financial support for the construction of the facilities that will be needed to maximize the use bio-refining. Congress has provided credit enhancements to encourage private investments in toll roads and other similar public-private partnerships. Limited Federal support in the form of credit enhancements would greatly ease access to much needed private capital to make bio-refining a possibility throughout the agricultural areas of our country. Again, Mr. Chairman, members of the committee, I strongly urge the committee to authorize USDA to provide additional financial support for biofuels. Such support would represent a wise investment of scarce USDA funds, and I encourage the committee to consider addressing this issue in the upcoming reauthorization of Federal farm programs. THE UNITED STATES HOUSE AGRICULTURE COMMITTEE REQUEST FOR WRITTEN TESTIMONY UNITED STATES COMMITTEE ON AGRICULTURE C/O U.S. HOUSE COMMITTEE ON AGRICULTURE SUBMISSION BLUE DIAMOND GROWERS The following is submitted by Blue Diamond Growers in response to the United States House Agriculture Committee request for Farm Policy Hearings, to identify those issues that most affect California farmers. Blue Diamond Growers is a non-profit farmer owned marketing cooperative. It markets almonds for its members. The almonds are grown exclusively in California and are the largest tree crop in the state. Almonds are the number one food export from California and consistently have ranked in the top ten food exports from the United States. Blue Diamond Growers exports the majority of the almonds grown in the State of California. Production continues to expand in order to supply the world. Approximately 70% of the world supply of almonds comes from California. Commodity Purchases: Blue Diamond Growers is working to assure amendments are included in the FY 2001 agriculture appropriations bill to continue to ensure farmer cooperatives, regardless of size, are fully eligible to participate under USDA's commodity purchase programs - a potential $2 billion market. Crop Insurance: Blue Diamond Growers supports changes in federal crop insurance program to allow farmers through their cooperatives and associations to join together to purchase or acquire needed insurance coverage on a more cost-effective basis. Statement of Susan Brauner China Permanent Normal Trade Relations (PNTR): Blue Diamond Growers supports PNTR for China to allow U.S. agriculture to: (1) gain improved access to its potentially huge and growing market, (2) fully realize the benefits of the recent U.S.-China trade agreement on agriculture, and (3) require China to play by the same international trading rules as the U.S. The tariff for almonds will be reduced from 35% to 10% if approved. Almond sales to China quadrupled in year 2000 and will quadruple again if the U.S. successfully passes China PNTR. Fast Track Trade Negotiating Authority: Blue Diamond Growers supports renewal of the President's trade negotiating authority under Fast Track. Ag Exports: Blue Diamond Growers supports increased funding for USDA export programs as follows: (1) increase funding for MAP up to $200 million; (2) allow up to 50% of available EEP funds to be used for market development and promotion. Ag Labor: Blue Diamond Growers supports legislative reform of the H-2A program in order to ensure an adequate legal agricultural workforce. The Dividend Allocation Rule: Blue Diamond Growers supports a legislative change that will allow cooperatives to pay a dividend on preferred stock or other proprietary capital interest without having to reduce the amount of patronage paid to members. Legislation is essential to help meet capital needs of farmer cooperatives and to strengthen farm income. Nonqualified Preferred Stock: Blue Diamond Growers supports legislation that will exempt farmer cooperatives from Section 351 of the Internal Revenue Code, which would allow farmer cooperatives to treat a transaction, or event where preferred stock is used as a deferred taxable event, rather than as taxable at the time the event takes place. Food Quality Protection Act (FQPA) Implementation: Blue Diamond Growers advocates workable FQPA implementation based on (1) use of sound science and reliable information, (2) transparent process, (3) balanced approach that includes both health and agricultural policy objectives, and (4) transition times when needed. Water Quality: Blue Diamond Growers supports policies emphasizing involvement of agriculture in addressing water quality challenges through voluntary, incentive-based partnerships. Global Climate Change: Blue Diamond Growers opposes the protocol/treaty in its current form and continues to monitor oversight hearings and other forums. Ozone and Particulate Matter Standards: Blue Diamond Growers supports a 9-year delay in implementation of EPA's new standards, which was included in the 1998 surface transportation reauthorization bill. COMMENTS JUDITH Y. BROWN to the HOUSE AGRICULTURAL COMMITTEE FIELD HEARING MAY 1, 2000 WOODLAND, CALIFORNIA My name is Judy Brown. I am here today representing myself, my family farm and the Family Farm Alliance a grassroots organization dedicated to preserving irrigated agriculture in the West. I live and farm near Orland in Glenn County. My family has been farming there for four generations and we currently have three generations actively involved in it. We grow many different field and row crops and cattle. Over the past 90 years we have provided a living for 18-20 families annually. But these past 10 years have been very tough economically and I am not sure how much longer we will be able to continue. Americans generally have more disposable income now than ever before. This is due in large part to the increasingly small portion of their income needed to buy food. There is only one generation alive now who has ever been hungry, the generation who went through the Great Depression. The rest of us, from the Baby Boomers on down haven't had to think about where our food comes from--it has always been there. In addition, only a very small proportion of Americans have any personal contact with farm or farmers. So it is good that you are here today to hear what farmers have to say. I believe that agricultural policies that are good for America need to go beyond program payments, LDPs, and crop insurance. Good policies should have the goal of keeping agricultural production in this country so that we don't become dependent on other countries for our food. I can't imagine why we would want to repeat the mistakes of the past which have caused us to be so dependent on foreign oil. We should have learned our lessons from the 1974 oil crisis and the current situation which saw prices for gasoline and diesel almost double in a short period of time because the oil producing countries decided to cut production and thereby raise prices. We are headed in the same direction with food. The current administration in its transition team meetings made a concious decision to shift American agricultural production to other countries of the world. This decision was made without public debate and without any particular approval by Congress. And now with the agricultural sector of the economy in deep distress while the rest of the country enjoys economic prosperity, we are offered Band-Aids from our benevolent Uncle. Good agricultural policy should start with the commitment to develop and keep a vibrant agricultural economy in the U.S. Congress should insist that the actions and regulations of all governmental departments and agencies support that goal. Currently the Departments of Interior and Commerce, along with the EPA, have more effect on agriculture than the USDA! Setting aside the issues of dismal prices for our crops and loss of crop protection tools, the major concern for my family's farm and many others throughout the West, is water. And more precisely, the lack of reliable supply and affordable price. Edicts from the Environmental Protection Agency, Bureau of Reclamation, Fish and Wildlife Service, National Marine Fisheries Service, have severely impacted the quantity and availability of surface water delivered to our farm. Increased price and reduced quantity are being forced upon us in Bureau of Reclamation contract renewals. This in turn will lead to increased groundwater pumping, which leads to groundwater overdraft. This is not a unique situation. I hear the same concerns from farmers in Arizona, Oregon, Idaho, Nevada, Nebraska, New Mexico, Washington, Wyoming, Colorado, Utah--wherever crops are irrigated. Without water farmers in the West cannot produce anything and all the program payments in the world will not change that. Congress needs to make a firm committment to creating the conditions that allows American agriculture to flourish once again. Simply handing out welfare checks to farmers is not good public policy. Judith Y. Brown -2 5/1/00 |