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Vernon C. Loen and Charles Leppert Files
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The original documents are located in Box 1, folder "Agriculture (1)" of the Loen and
Leppert Files at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 1 of the Loen and Leppert Files at the Gerald R. Ford Presidential Library
March 14, 1975
MEMORANDUM FOR:
JACK MARSH
THRU:
MAX FRIEDERSDORF
VERN LOEN
FROM:
CHARLES LEPPERT, JR.
SUBJECT:
Surplus Potato Meeting
Friday, February 28, 1975
Attached for your information is the list of potato industry repre-
sentatives attending the above meeting, as supplied by former
Rep. Orval Hansen.
cc: Russ Rourke
FORD & GERALD LIBRARY
ATTENDANCE ROSTER
DEHYDRATED POTATOES FOR WORLD HUNGER MEETING
WHITE HOUSE
February 28, 1975
Clarence A. Parr
Past President, National Potato
Route #1, Box 209
Council; Past President, Potatc
Burley, Idaho 83318
Growers of Idaho, Inc.; Member,
Idaho Potato Commission; Author
to represent Potato Growers of
Idaho, Inc., P. O. Box 949,
Blackfoot, Idaho; Potato grower
Doyle Burns
Executive Director, National
National Potato Council
Potato Council.
301 Montbello Campus
Denver, Colorado 80239
Merle Anderson
Past President, National Potatc
Climax, Minnesota 56523
Council; President, Red River
Valley Potato Growers Associati
Potato grower.
Lloyd Schmidt
Executive Vice President, Red
P. O. Box 301
River Valley Potato Growers
East Grand Forks, Minnesota 56721
Association.
Patrick Heffernan
Vice Chairman of the Board, The
American Potato Company
American Potato Company; operat
Bank of America Center
potato plants in Idaho, Wiscons
San Francisco, California 94104
and Washington.
Robert E. Pennock
Operations Manager, Rogers
Rogers Brothers Company
Brothers Company; operates pota
P. O. Box 2188
plants in Idaho, Washington and
Idaho Falls, Idaho 83401
North Dakota
John Cahill
Vice President, The R. T. Frenc
The R. T. French Company
Company; operates potato plants
One Mustard Street
in Idaho, Nevada and Maine.
Rochester, New York 14609
Stephen M. MacArthur
Washington Representative,
Carnation Company
Carnation Company; operates pot
1629 K Street, N. W.
plants in Washington and Idaho
Washington, D. C. 20006
GERALD FORD LIBRARY
attendance Roster
Page 2
Dehydrated Potatoes for World Hunger Meeting
White House
February 28, 1975
Orval Hansen
Former Member of Congress of
1819 H Street, N. W.
Second District of Idaho.
Washington, D. C. 20006
Hoyt A. Blackstock
Vice President, J. R. Simplot
J. R. Simplot Company
Company - Idaho and Minnesota.
P O Box 1059
Caldwell, Idaho 83605
Bernard W. Shaw
President, Maine Potato Council
R. F. D. #1, Box 41
Vice President, National Potato
Limestone, Maine
Council; potato grower.
George C. Walker
Representing potato farmers in
124 South 11th
Othello and Wahluke Slope area.
Othello, Washington
Lorin A. Grigg
Director, Washington Agricultur
Route 1, Box 52
Marketing Association; potato
Quincy, Washington 98848
grower.
Davis L. Sparks
Past Director, Rogers Brothers
Moses Lake, Washington 98837
Idaho Falls, Idaho; President,
Columbia Industries 1967-70 -
manufacturer of potato granules
potato grower.
Ruland G. Sparks
Potato Grower.
P O Box 1027
Moses Lake, Washington 98837
Bobie L. Whitaker
Potato grower representing
Route 1, Box 123
Warden Washington area.
Warden, Washington
Ralph Harding
Former Member of Congress-Secon
Route 4, Box 164
District of Idaho.
Blackfoot, Idaho 83221
Edwin J. Stastny
Vice Chairman, Oregon Potato
Star Route, Box 24
Commission; Past Vice Chairman,
Malin, Oregon
National Potato Council
FORD is LIBRARY 076870
MEMORANDUM
THE WHITE HOUSE
WASHINGTON
March 6, 1975
MEMORANDUM FOR:
CHARLES LEPPERT
FROM:
NORM ROSS
Attached is a list of government officials who attended
the Ralph Harding and associates meeting on potatoes,
per your request.
THE WHITE HOUSE
WASHINGTON
February 27, 1975
Potato Meeting at 10:00 a.m. - Friday, Feb. 28, 1975
445 OEOB
Norm Ross
Charlie Leppert
Russ Rourke
Dick Dunham - Dep. Domestic Council
Agriculture - Art Mead
State - Robert Service
AID - Food for Peace - Dan Shaughnessy
From Outside the White House
Mr. Harding
Former Cong. Orval Hansen
Clarence Parr
Doyle Burnes
Merle Anderson
Lloyd Schmidt
Patrick Heffernan
Robert Pennock
John Cahill
Steven McArthur
Hoyt Blackstock
Bernard Shaw
George Walker
Loren Grigg
David Sparks
Roland Sparks
Bobbie Whitaker
J. Connally
Johnnie O'Brien
YORD & 070830 LIBRARY
Government Officials attending the Ralph Harding
and Associates Meeting on Potatoes - Feb. 28
Daniel Shaughnessy, Associate Coordinator, Office of Food
for Peace, AID, State Department
Peggy Sheehan, Chief of Program Operations Division, AID,
State Department
James A. Placke, Director, Office of Food Policy and Programs,
State Department
Arthur Mead, Assistant Administrator for P.L. 480 Programs,
Department of Agriculture
Phillip DuSault, International Affairs Division, Office of Budget
and Management
Richard Dunham, Deputy Director, Domestic Council
Charles Leppert, Congressional Liaison, White House
Norman Ross, Associate Director, Domestic Council
(Don't know if Russ Rourke attended - his office coordinated
with Harding to set up meeting)
Government Officials attending the Ralph Harding
and Associates Meeting on Potatoes - Feb. 28
Daniel Shaughnessy, Associate Coordinator, Office of Food
for Peace, AID, State Department
Peggy Sheehan, Chief of Program Operations Division, AID,
State Department
James A. Placke, Director, Office of Food Policy and Programs,
State Department
Arthur Mead, Assistant Administrator for P.L. 480 Programs,
Department of Agriculture
Phillip DuSault, International Affairs Division, Office of Budget
and Management
Richard Dunham, Deputy Director, Domestic Council
Charles Leppert, Congressional Liaison, White House
Norman Ross, Associate Director, Domestic Council
(Don't know if Russ Rourke attended - his office coordinated
with Harding to set up meeting)
Government Officials attending the Ralph Harding
and Associates Meeting on Potatoes - Feb. 28
Daniel Shaughnessy, Associate Coordinator, Office of Food
for Peace, AID, State Department
Peggy Sheehan, Chief of Program Operations Division, AID,
State Department
James A. Placke, Director, Office of Food Policy and Programs,
State Department
Arthur Mead, Assistant Administrator for P.L. 480 Programs,
Department of Agriculture
Phillip DuSault, International Affairs Division, Office of Budget
and Management
Richard Dunham, Deputy Director, Domestic Council
Charles Leppert, Congressional Liaison, White House
Norman Ross, Associate Director, Domestic Council
(Don't know if Russ Rourke attended - his office coordinated
with Harding to set up meeting)
Government Officials attending the Ralph Harding
and Associates Meeting on Potatoes - Feb. 28
Daniel Shaughnessy, Associate Coordinator, Office of Food
for Peace, AID, State Department
Peggy Sheehan, Chief of Program Operations Division, AID,
State Department
James A. Placke, Director, Office of Food Policy and Programs,
State Department
Arthur Mead, Assistant Administrator for P.L. 480 Programs,
Department of Agriculture
Phillip DuSault, International Affairs Division, Office of Budget
and Management
Richard Dunham, Deputy Director, Domestic Council
Charles Leppert, Congressional Liaison, White House
Norman Ross, Associate Director, Domestic Council
(Don't know if Russ Rourke attended - his office coordinated
with Harding to set up meeting)
FORD
March 3, 1975
MEMORANDUM FOR:
JACK MARSH
THRU:
MAX FRIEDERSDORF
VERN LOEN
FROM:
CHARLES LEPPERT, JR.
SUBJECT:
Surplus Potatoes
The meeting requested by Ralph Harding and Orval Hansen concerning the
plight of the potato farmers and processors over the surplus potato
situation, was held on Friday, February 28, 1975.
Norman Ross of the Domestic Council chaired the meeting. After all parties
(list attached) were given an opportunity to express their views and positions
or ask questions. Mr. Ross advised the group that for FY '75 on the short
term problem there was nothing the Administration could do to assist the
plight of the potato farmers and processors. For the long term the Admini-
stration will continue to look at dehydrated potatoes for inclusion in the
P.L. 480 program.
Mr. Harding responded adamantly and negatively to the lack of any Admini-
stration short-term solution and suggested that those present contact their
Congressmen and Senators on the matter.
Attachment
CC: Doug Bennett
Norm Ress
FORD is LIBRAR 076939
HE
THE WHITE HOUSE
WASHINGTON
February 27, 1975
Potato Meeting at 10:00 a. m. - Friday, Feb. 28, 1975
445 OEOB
Norm Ross
Charlie Leppert
Russ Rourke
Dick Dunham - Dep. Domestic Council
Agriculture - Art Mead
State - Robert Service
AID - Food for Peace - Dan Shaughnessy
From Outside the White House
Mr. Harding
Former Cong. Orval Hansen
Clarence Parr
Doyle Burnes
Merle Anderson
Lloyd Schmidt
Patrick Heffernan
Robert Pennock
John Cahill
Steven McArthur
Hoyt Blackstock
Bernard Shaw
George Walker
Loren Grigg
David Sparks
Roland Sparks
Bobbie Whitaker
J. Connally
Johnnie O'Brien
RED TAG
THE WHITE HOUSE
norm Ross mtg them
WASHINGTON
Fri 2/21/75 at
February 19, 1975
:30 am
per Ross' office
MEMORANDUM FOR:
JOHN O. MARSH
THRU:
MAX L. FRIEDERSDORF
VERN LOEN V.L.
FROM:
CHARLES LEPPERT, JR. Cag.
SUBJECT:
Request by Governors Evans, Andrus,
Anderson, Milliken for Meeting with
President on the Potato Surplus
Ralph Harding called at 4:30 p.m. today stating that the Governors
named above will request a meeting with the President on February
20th or 21st concerning the potato surplus and the need for federal
assistance.
Harding and Dave Clark, President of the National Potato Council,
have advised Governor Evans that if successful in getting a meeting
with the President the group to meet with the President should include
Members of the House and Senate from the potato states and include
Harding, Dave Clark, Orval Hansen and the leaders of the Farm Bureau
Federation and the National Farmers Organization. Harding states his
intent is to keep the group relatively small and selectively screened so
that nobody uses the occasion for political publicity.
Harding and Dave Clark will arrive in Washington, D. C., tomorrow
and will call you or me in the morning.
LISAARY GERALD P. FORD
THE WHITE HOUSE
WASHINGTON
February 14, 1975
MEMORANDUM FOR:
JACK MARSH
THRU:
MAX FRIEDERSDORF
VERN LOEN
FROM:
CHARLES LEPPERT, JR.
Lg.
SUBJECT:
Former Rep. Ralph Harding's proposal
for federal assistance to potato farmers
and processors
Talked to Ralph Harding today regarding specific dates for meetings of
potato farm leaders and processors here in Washington, D.C. He states
that the National Potato Council is trying to arrange a meeting here for
Wednesday, February 19, 1975, but feels they cannot get their people here
on such short notice. He states he will keep me advised of meeting dates
if possible.
Harding wanted you to know that the bottom has fallen out of the potato
situation in the last two weeks and could not overstate how hot the issue
was in the states of Idaho and Washington where the President of the
National Potato Council resides.
Harding states that the Administration will be hearing from the Senators,
Representatives, Governors and farm organizations from the states of
Washington, Idaho, California, Oregon, Nevada, Colorado, Minnesota,
Wisconsin and Maine in the next few weeks on this issue. He expects
Senators Jackson and Humphrey to hit the Administration very hard on the
issue. In addition, Harding expects that there may be something coming
out of the next Governor's Conference on the potato situation.
If nothing is done Harding expects potato farmers to plan TV filming of
hauling potatoes to a dump and burning them for the National news media
coverage.
THE WHITE HOUSE
WASHINGTON
February 13, 1975
MEMORANDUM FOR:
JACK MARSH
THRU:
MAX FRIEDERSDORF
VERN LOEN
FROM:
CHARLES LEPPERT, JR
CLop.
SUBJECT:
Former Rep. Ralph Harding's request
for Presidential meeting on potato surplus
Per your request I talked to Ralph Harding on February 12, 1975. He
wanted to bring you up to date on the potato situation he discussed with
you in November 1974.
Mr. Harding contends that disaster is about to strike the potato farming
and processing industries because of the expected large potato surplus.
People in the industry have been calling him to meet in Washington, D.C.
He wants to set up a federal program to assist the potato farmers and
processors.
Harding contends the situation will be so grave that potato farmers and
processors will go bankrupt, potato workers will be unemployed and the
potato crop will be dumped as a loss. He further contends that if the
President was aware of the situation federal assistance could be provided
and he renews his request to see the President with Orval Hansen.
Harding further contends that the State Department is giving him the usual
bureaucratic run around as Secretary Butz has indicated support for his
concept. He says that if the State Department and AID got behind his
concept they could get the Arab countries to buy $25 million worth of the
potato surplus to feed some of the starving people of the world.
I am awaiting a return call from Harding as to whether or not he and the
farm leaders intend to meet in Washington, D.C. on this matter, the
dates and where, within the next few weeks.
2
I have also discussed the matter with former Rep. Orval Hansen who agrees
with the gravity of the situation and the need for federal action to assist the
potato farmers and processors.
Recommendations:
(1)
If Ralph Harding informs me that he will be meeting with farm
leaders here in Washington, D. C. on a specific date in the next few
weeks, a meeting should be set up with the Department of Agriculture,
State, and OMB to determine if federal assistance can or cannot be
provided.
(2)
Prior to such meeting, if one is to be held, the Department of Agri-
culture, State and OMB should identify the problem, if any, from
their own sources and possible solutions for explanation at a meeting
with Harding, Hansen and the farm leaders or with Harding and
Hansen alone.
2-11-75
Oh,
Jack March
1. Call from Indising - has anybady
introduced DONE
r. Raeph Harding Cong-fram Adaho - fdea that
hos mest - wants to set to Pres. - His
Buggest in - dehydrated fataline. food
value - probably alter whone to was
feedurg to feed grains - shing dehydrated
datates. - Imustra Connect sap it
Naving
1
has merit - wants Organlle Haven
haved admin for tankers Relief.
(208)-684-4441
0494 p.on Retaching New around
amer.
(H) 785-1248
(0) 684 - 4441
will come the P. if State threy * Dut. of
per the
came
Matlet
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Notato Conneie
Pres. net l Pot. music called K other gaps
problems of last nor has happened
want mks
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Sreatest mylas of pataties n hurny 8 lanty
and n units story - process patables
& hun seas. days Paren polation washing
referred morth hrom
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funners. fune uses.
apr for Onmalle House. t he to see P. only
an this matter
LAID
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of pataters for story yes.
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planted - greatest crap in have
400 by to the are - cost in them
50 alants to deligdrate + day wereas
at 50% capacity now us MRA
Real disaster - something must be donet fort
to farmers
pounes toking
INFan Horrd
meet w/ Qy. t Soute
Care much Anne
pulmo
GEEATE
GERALD
LIBRARY FORD
QTAN
January 18, 1973
MEMORANDUM FOR: DON RUMSFELD
FROM:
JACK MARSH
Ralph Harding, according to the Demestic Council, did have a pretty
good idea on using dehydrated potatoes in famine situations.
con
However, there is one aspect of the attached letter which I should
discuss with you personally as to whether the President feels it
best not to meet with Harding and Orval Hansen.
I think it might be helpful to run this back through the circuit by
sending it to the Domestic Council to see if there is a way that the
Harding proposal can be at least used in part.
the
of
28
New
Year,
GERALD FORD LIBENAL
RALPH HARDING
Route 4, Box 164
BLACKFOOT, IDAHO 83221
showedent
ltr15 1/16
January 9, 1975
The Honorable John Marsh
Councilor to the President
White House
Washington, D. C.
Dear Jack:
As much as I admire President Ford, my patience is
exhausted. Starting next week. I am going to Humphrey,
McGovern, Tom Foley, and the Democratic Study Group
with this program.
I think it is a damned disgrace for people to be
starving to death throughout the world while the
United States is facing the possibility of potato
prices that are going to brankrupt farmers and result
in potatoes being dumped on the ground and potato plant
workers going unemployed.
I sincerely hope you will deliver my letter to the
President immediately and that he will find the time
to spend fifteen minutes with Orval Hansen and me.
Best personal regards for a Happy and Successful New
Year!
Sincerely
those
Jack, Ralph Ralph R. Harding I would hate this tration to a " for nothing g the His
FORD & LIBRARY 9ERALD
who Wait have at are and the and See highest high I I mine h regards for your H Rold find,
RALPH HARDING
Route 4, Box 164
BLACKFOOT, IDAHO 83221
January 9, 1975
The Honorable Gerald A. Ford
President of the United States
White House
Washington, D. C.
Dear Mr. President:
Because of my deep personal respect for you as a Member of Congress
and my high hopes for you as President, I have been working since
November 1, 1974 to secure Administration action on a program of
feeding dehydrated potatoes to the starving people of the world.
This program could possibly save 1,500,000 people from starvation,
thousands of American potato growers from drastic financial losses,
and thousands of potato processing plant employees from the loss of
their jobs.
I have worked in full cooperation with former Congressman Orval
Hansen and made every effort to date to make this an Administration
Program. However, the reaction has been one of a typical bureau-
cratic red tape roadblock. I feel I can no longer in good conscience
wait for Administration action on such a program.
I am making this final request for an appointment for Orval Hansen
and me to meet with you next week to spend about fifteen minutes
explaining the program. If such a meeting is again denied (this is
my third request), I feel I have no alternative but to go to the
news media and the Members of Congress with all of the facts as to
why, in a world where people are starving to death, we are going to
be dumping potatoes onto the ground and into the garbage pits this
spring.
I sincerely hope we will have an opportunity to discuss this vital
matter early next week.
Best personal regards for a Happy and Successfull New Year.
Your
former
colleague,
Ralph Member Idaho R. Second of Harding Congress District 1961-1965
THE ECONOMICS OF AGRICULTURE
[ca. 4/75]
U.S. FARM POLICY GOAL: A highly efficient agriculture, to provide maximum
benefits for the nation, for farmers, and for the
world.
NATIONAL BENEFITS:
An abundance of high-quality food and fiber for consumers.
Strength for the nation's trade balance through farm exports.
Jobs created and sustained by high production, processing and
marketing of farm commodities, both domestically and overseas.
Prosperous, stabilized rural communities and population.
FARM BENEFITS:
*
Freedom to manage individual operation--maximize efficiency--
lower production costs.
*
Opportunity to produce for export demand.
Improved farm income.
WORLD BENEFITS:
Higher output of food to meet increasing demand.
Competition in the marketplace--less reliance on the U.S. as
a residual supplier and "storehouse for the world."
The rapid shift to market-oriented farm policies in recent years has been
facilitated by growing world demand and affluence.
*
World population is growing 1.9 percent annually (about
80 million persons).
World incomes are rising rapidly, fueling the desire of
people in all countries to eat better and live better
than they have in the past.
Increased world demand focuses attention, places higher value
on comparative advantage of U.S. farmer in food production.
Adverse weather conditions and strong demand have depleted
world food stocks since 1972. However, with normal weather and
strong farmer incentives, stocks could be replenished this year.
MARKET-ORIENTED FARM POLICY IN THE U.S.:
Frees U. S. farmers for full production. Acres taken out of
production under previous policies of controlled production
have been returned to crops as rapidly as farmers could
profitable do so since 1972. No set-aside acres have been
required under farm programs in 1974 or 1975.
Allows greater efficiency in farming. About one-third of the U.S.
cropland is now being used differently than it was under the
allotment patterns.
Contributes to U. S. national economy. National purchasing power
is at an all-time high.
CURRENT FARM POLICY ISSUES
DOMESTIC ISSUES:
The market-oriented approach works with wheat, feed grains
and cotton. Should it be extended to peanuts, rice and
extra-long-staple cotton?
What is the function of target prices? How high should they
be set?
What is the proper relationship between target prices and
loan levels?
Is there a proper role for export controls. Under what
conditions?
Do export controls lead to import restrictions by other
countries?
Do export controls make the U.S. appear to be an unreliable
supplier?
Who should hold food and farm commodity stocks needed to
buffer changes in supply and demand?
-- Can the Government hold reserves without decreasing
farmers' incentives to produce?
-- Can farmers carry their own stocks?
-- What is the proper role for private trade in the
reserve picture?
How can farm production costs be slowed?
INTERNATIONAL ISSUES:
U. S. farm output is not without limits. How can world
agricultural productivity and efficiency be increased to
meet growing demand?
How do we assure that other nations assume a larger share
of the support role for increasing world food security?
What is the proper role of the U.S. in world food production
and distribution?
FOOD STAMPS AND FEEDING PROGRAMS
BUDGET: The growing share of the USDA budget represented by food stamps
and feeding programs is a major concern.
*
Fiscal 1974 feeding programs claimed about half the USDA budget.
Fiscal 1975 feeding programs claim about two-thirds of the USDA budget.
Despite Administration attempts to eliminate waste and overlap, the
FY 1976 proposed USDA budget allots nearly three-fifths of the total
requested appropriation to feeding programs.
Fiscal 1975 outlays will exceed $5.8 billion. The Food Stamp Program
represents the major cost increase. Other feeding programs include:
-- school lunch and pilot school breakfast.
-- equipment assistance to schools.
-- non-school child feeding.
-- special milk.
-- special supplemental food program for women, infants,
and children (WIC).
-- commodity donations to schools.
-- summer camps.
-- child-care centers.
-- non-profit institutions.
-- Indian reservations.
-- nutrition education for low-income families.
PROGRAMS:
Authority for the pilot school breakfast, non-school food, and WIC
programs expires June 30, 1975. The Administration will not seek
extension.
Authority to purchase commodities, regardless of price, to maintain
donations for food assistance programs expires on June 30, 1975.
The Administration does not wish to extend this legislation.
Instead the Administration will propose legislation substituting a
comprehensive block grant program for existing overlapping child
feeding programs.
The Administration also will seek to limit to 5 percent any price
index adjustments (January 1, 1975 through June 30, 1976) for child
nutrition and food stamp programs.
ISSUES:
*
What is the role of food stamps in overall assistance to the needy?
What level of food stamp funding can the Government sustain without
seriously aggravating inflation because of higher Treasury outlays?
What effect would still higher food stamp benefits have on work
incentives?
RURAL AND SMALL TOWN AREAS
RURAL DEVELOPMENT POLICY: Current policy is aimed at achieving a
better balance in national growth. That
policy is succeeding.
Net migration of millions of rural people to urban centers is
beginning to reverse.
Farm population has stabilized at 9-1/2 million people.
Non-farm rural and small town areas are growing.
Job opportunities in non-metro areas are increasing faster
than in big cities.
Manufacturing and other business enterprises are putting
facilities in rural and small town areas.
ISSUES:
Non-metro areas have one-third of the population but two-thirds
of the substandard housing. How can this be corrected?
Non-metro areas have one-half of the nation's people who are in
the "poverty" class. What is the proper Government response
to this situation?
How can Federal programs gear-in more planning assistance and
support in shaping and carrying out rural development projects
from:
-- local groups?
-- local community leaders?
-- local program participants?
-- private enterprise in the local community.
LAND AND NATURAL RESOURCES
PRESSURES ON LAND USE: Demands on land and natural resources continue
to grow. Food and fiber production competes
with:
-- recreation.
-- highways.
-- community development.
-- airports.
-- shopping centers
-- other uses.
ISSUES:
*
What is the Government's proper role in assisting rural
communities with:
-- grants?
-- loans?
-- technical assistance?
-- personnel interchange?
What is the proper Government role in the confrontation
between "status quo environmentalists" and producers of
food and fiber?
*
What investments should the Federal Government make in
conservation, protection and development of renewable
natural resources?
*
Should the Executive Branch of Government be reorganized
to improve policy and programs for land and natural resources?
If so, how?
-- a Department of Energy and Natural Resources?
-- a Department of Agriculture and Natural Resources?
-- leave structure as is?
AGRICULTURAL RESEARCH
FOOD PRODUCTION AND TECHNOLOGY:
*
New knowledge and technology are needed to meet efficiency
goals in:
-- food and fiber production.
-- transportation and marketing of agricultural commodities.
-- environmental protection and improvement.
-- resource conservation, development and use.
*
Both pure and applied research are needed to:
-- develop new and hardier seeds and strains.
-- control pests, and plant and animal diseases.
-- improve irrigation techniques.
-- establish better cultural practices.
-- maintain soil fertility.
COOPERATIVE GOALS AND PROJECTS:
*
Improved Federal and State relationships are needed to:
-- pinpoint goals and objectives.
-- adapt findings to local and regional conditions.
-- eliminate duplication of effort, waste and overlap.
NEW, INNOVATIVE IDEAS:
*
World conditions demand expanded cooperation in projects,
such as:
-- LACI and other earth satellite projects.
-- A "Food for Peace" Institute.
-- A worldwide weather and crop information
dissemination system.
[ca. 4/75]
POINTS WITH RESPECT TO VETO OF FARM BILL
(1)
Bill as passed legislates inflation by increasing the cost of
food ingredients, i.e. butter, milk, cheese, flour.
(2)
Results in increased food costs to consumers.
(3)
Non-farm, urban and suburban areas reap no benefits but
bear the cost of price supports for farmers both on consumers
and taxpayers.
(4)
Farm bill calls for $1. 8 B increased spending in fiscal year 1976.
(5)
Farm bill not included in $70 Billion Budget deficit resolution
passed by House last week. Approval of this bill would make a
farce of the budget resolution.
Talked to Cong. Joe Waggonner and he wanted to suggest three things that
the veto message reflect.
[ca.4/75]
1. To acknowledge that farmers are in severe economic difficulty - all
farmers not just cotton farmers and overall tenor of veto message acknowledge
this fundamental fact.
2. Point out that trying to help feed grain and wheat farmers and would like
to help cotton farmers as well.
3. Legal authority and mechanics - P. should direct Secretary to review the
method and formulas in which cotton loans are calculated and, secondly, to
examine carefully the authority that Agriculture Dept. has to make open
market purchases of cotton.
Hyde Murray in total harmony with that because that is what he wanted.
Veto instrument language which may have to be polished by speech writers.
Don't foul it up.
COTTON - I realize of course, that farmers face serious problems in
producing the food and fiber that all the rest of us depend upon
and I
sincerely seek to solve those problems not aggravate them.
That is why I have taken the action earlier described to help wheat and feed
grain farmers adjust to the severe increase in the cost of production
occurring since the 1973 farm bill was enacted.
I would like to be as responsive to cotton growers as well but unfortunately
the law is not as clear nor as apparently flexible in the case of cotton as it
is for grains. I, therefore, have directed the Sec. of Agriculture to thoroughl
re-examine existing cotton legal authority, both in regard to calculating and
establishing loan levels and in the exercise of authority to make open market
purchases. This we will do in an effort to help create the confidence and
nurture the hope of cotton producers that Washington, D. C. does indeed
concern itself with their legitimate and vital interests.
Talked to Cong. Joe Waggonner and he wanted to suggest three things that
[ca. 4/75]
the veto message reflect.
1. To acknowledge that farmers are in severe economic difficulty - - all
farmers not just cotton farmers and overall tenor of veto message acknowledge
this fundamental fact.
2. Point out that trying to help feed grain and wheat farmers and would like
to help cotton farmers as well.
3. Legal authority and mechanics - P. should direct Secretary to review the
method and formulas in which cotton loans are calculated and, secondly, to
examine carefully the authority that Agriculture Dept. has to make open
market purchases of cotton.
Hyde Murray in total harmony with that because that is what he wanted.
Veto instrument language which may have to be polished by speech writers.
Don't foul it up.
COTTON - I realize of course, that farmers face serious problems in
producing the food and fiber that all the rest of us depend upon.
and I
sincerely seek to solve those problems not aggravate them.
That is why I have taken the action earlier described to help wheat and feed
grain farmers adjust to the severe increase in the cost of production
occurring since the 1973 farm bill was enacted.
I would like to be as responsive to cotton growers as well but unfortunately
the law is not as clear nor as apparently flexible in the case of cotton as it
is for grains. I, therefore, have directed the Sec. of Agriculture to thoroughl
re-examine existing cotton legal authority, both in regard to calculating and
establishing loan levels and in the exercise of authority to make open market
purchases. This we will do in an effort to help create the confidence and
nurture the hope of cotton producers that Washington, D. C. does indeed
concern itself with their legitimate and vital interests.
Talked to Cong. Joe Waggonner and he wanted to suggest three things that
(s.
4/75]
the veto message reflect.
1. To acknowledge that farmers are in severe economic difficulty -- all
farmers not just cotton farmers and overall tenor of veto message acknowledge
this fundamental fact.
2. Point out that trying to help feed grain and wheat farmers and would like
to help cotton farmers as well.
3. Legal authority and mechanics - P. should direct Secretary to review the
method and formulas in which cotton loans are calculated and, secondly, to
examine carefully the authority that Agriculture Dept. has to make open
market purchases of cotton.
Hyde Murray in total harmony with that because that is what he wanted.
Veto instrument language which may have to be polished by speech writers.
Don't foul it up.
COTTON - I realize of course, that farmers face serious problems in
producing the food and fiber that all the rest of us depend upon.
and I
sincerely seek to solve those problems not aggravate them.
That is why I have taken the action earlier described to help wheat and feed
grain farmers adjust to the severe increase in the cost of production
occurring since the 1973 farm bill was enacted.
I would like to be as responsive to cotton growers as well but unfortunately
the law is not as clear nor as apparently flexible in the case of cotton as it
is for grains. I, therefore, have directed the Sec. of Agriculture to thoroughl
re-éxamine existing cotton legal authority, both in regard to calculating and
establishing loan levels and in the exercise of authority to make open market
purchases. This we will do in an effort to help create the confidence and
nurture the hope of cotton producers that Washington, D. C. does indeed
concern itself with their legitimate and vital interests.
FORD is LIBRARY GERALD
94TH CONGRESS
HOUSE OF REPRESENTATIVES
REPORT
1st Session
No. 93-125
EMERGENCY LIVESTOCK CREDIT
APRIL T, 1975.-Committed to the Committee of the Whole House on the State of
the Union and ordered to be printed
Mr. FOLEY, from the Committee on Agriculture,
submitted the following
REPORT
[To accompany S. 1236]
The Committee on Agriculture, to whom was referred the bill
(S. 1236) having considered the same, report favorably thereon with
amendments and recommend that the bill as amended do pass.
The amendments are as follows:
Strike out all after the enacting clause and insert in lieu thereof
the following:
That the Emergency Livestock Credit Act of 1974 is amended as follows:
(a) Subsection (b) of section 2 of said Act is amended by striking everything
following the word "Provided" and inserting in lieu thereof "That the term
'legally organized lending agency' shall be deemed to include the Federal Financ-
ing Bank only to the extent that such Bank may hold the guaranteed portion
of such loans.".
(b) Subsection (c) of section 2 of said Act is amended by striking everything
after the word "Secretary" and inserting "to guarantee more than 90 per centum
of the principal and interest on said loan.".
(c) Subsection (f) of section 2 of said Act is amended to read "Loans
guaranteed under this Act may be payable over a period of time as determined
by the Secretary, but not to exceed seven years.".
(d) Subsection (a) (3) of section 3 of said Act is amended by deleting every-
thing after the words "Provided, That" and inserting in lieu thereof "the total
principal balance outstanding at any one time on loans guaranteed under this
Act for any borrower shall not exceed $250,000 ;
(e) Section 8 of said Act is amended to read as follows: "The provisions of
this Act shall become effective upon enactment, and the authority to make new
guarantees under this Act shall terminate on December 31, 1976.".
(f) Section 4 of said Act is amended to read as follows: "Loans guaranteed
under this Act shall be secured by collateral adequate to protect the Govern-
ment's interests, as determined by the Secretary: Provided, That the Secretary
may accept collateral which has depreciated in value owing to temporary eco-
nomic conditions and which in the opinion of the lender, together with his
confidence in the repayment ability of the borrower, is adequate security for
the loan.".
(g) Section 5 of said Act is amended by adding a new sentence at the end
thereof stating, "Such fund may also be utilized to pay administrative expenses
of the Secretary necessary to carry out the provisions of this Act.".
38-006
FORD is LIBRARY 076870
3
2
munity, especially rural bankers, of a commitment by the Government
(h) Said Act is amended by adding at the end thereof the following new
to a strong and viable livestock industry. The extension also comes at
section 11:
"SEC. 11. The Secretary shall report to the Committee on Agriculture, U.S.
a time when the usefulness of the program to the cattle farmers and
House of Representatives, and the Committee on Agriculture and Forestry, U.S.
ranchers being reflected in increased loan activity. For instance, Mr.
Senate, on or within one year of the date of the enactment of this section, and
Irwin, Assistant Secretary for Rural Development, testified that as of
annually thereafter, with respect to the effectiveness of this Act. The Secretary
March 7, 1975, there were 1,811 borrowers that had $218.1 million in
shall be required, but not limited, to include in such report the number of loan
applications submitted, the number and amount of loans approved, the financial
loans under the emergency livestock loan program. More recent figures
situation facing cattlemen at the time of the report, the effect of this Act on the
from the Department, a mere 2 weeks later (March 21, 1975) indicate
retail marketing of beef and on the farm-retail price spread of beef, and any
that there are 1,942 borrowers and $232.5 million in loans.
recommendations he may have as to actions which can be taken to further de-
Given the testimony before the Subcommittee that the economic
crease the price spread and to increase the comsumption of beef."
SEC. 2. Section 316 of the Consolidated Farm and Rural Development Act is
plight of the cattle producers will undoubtedly continue through the
amended by striking the period at the end of the first sentence and inserting after
year, the amendment of the Emergency Livestock Credit Act to permit
the words "additional years" the following: "except that if two or more loans
repayments of loans in periods up to 7 years, in lieu of 3 years (with
are consolidated the renewal period shall be computed from the due date of the
up to a 2-year renewal), will provide the Secretary with flexibility to
most recent loan."
provide farmers and ranchers emergency loans with a repayment
Amend the title to read as follows:
schedule that allows the farmers to get on as sound a financial footing
"To amend the Emergency Livestock Credit Act of 1974
as possible before they are required to pay off the loans.
and Section 316 of the Consolidated Farm and Rural Devel-
The amendment in the bill providing a "line of credit" to livestock
opment Act."
farmers and ranchers up to $250,000 will, in the opinion of the Com-
mittee, eliminate a certain amount of redtape and provide both the
NEED AND PURPOSE OF THE LEGISLATION
lender and the borrower with much needed flexibility in this program.
The Department records indicate that as of January 1, 1975, 70 percent
The need for this legislation arose since the enactment of the Live-
of the borrowers and 78 percent of the money loaned under the emer-
stock Credit Act of 1974 on July 25, 1974. Livestock prices have
gency livestock loan program involved the beef cattle business. Also.
dropped even further than the point they had reached in mid-1974, and
the testimony in the hearings indicated that the average loans to beef
the financial stress on producers now is even greater than it was when
producers were running on the average about $136,000. It makes sense
the Livestock Credit Act of 1974 was passed.
to place these loans on a line-of-credit basis, where farmers and
Based on the testimony of representatives of the Agriculture De-
ranchers are constantly culling their herds and subsequently adding
partment, the cattle level in March 1975 is running at a near record
to them, such that where portions of loans are curtailed that borrowers
level as a result of a 7-year growth period, while the food grain sup-
need not go through the needless and time-consuming procedures of
plies are some 20 percent, and roughage supplies are some 10 percent,
taking out new loans. Rural banks have traditionally handled their
smaller than last winter. The slaughter of cattle has been at record
loans with implement dealers and others on this basis and, for purposes
levels since January, largely because of the inability of farmers to
of efficient administration and flexibility, it appears advisable to place
carry their cattle through the winter. However, Departmental spokes-
this program on a line-of-credit basis. The limit of $250,000, which
men expect the cattle inventory to remain at record levels; but, despite
Congress approved when it passed the Emergency Act in 1974,
this, they do not expect cattlemen to be "in a clear-cut profit position
remains intact in this bill.
for the rest of this year." This is not to say their position may not im-
The Department of Agriculture, as noted in its letter printed here-
prove somewhat once cattle can be put out in pastures and ranges and
after, supports this bill. The amendment to section 4 of Public Law
if there is a large feed grain harvest this fall. However, we have got a
93-357, to which the Department originally objected, was changed in
record cow herd and most likely will have another record calf crop this
Committee markup SO as to make it acceptable to the Department.
year. The only relief that can help the cow-calf operators; that form
While the Department has not commented on two other changes made
the very foundation of the beef industry, is an increased demand for
during the Committee markup (the new section 11 report require-
their product (feeder cattle). Basically such a turnaround will require
ment provision, and the relatively minor amendment to the Consoli-
higher prices for feeder cattle and lower feed costs.
dated Farm and Rural Development Act), it is understood that there
In a deteriorating market that has seen the inventory value of cattle
is no objection to the inclusion of such amendments. The general posi-
reduced by nearly 50 percent in recent months, the loss of equity and
tion of the Department regarding changes in existing law was artic-
the expectation of a longer period of nonprofit operations cálls for, if
ulated by Assistant Secretary Erwin in the course of the Subcommittee
not demands, some liberalization of credit conditions for livestock
hearings:
producers through amendments to the Emergency Livestock Credit
Some changes in the Emergency Livestock Credit Act of
1974 would have the support of the Administration, based
The extension of the Emergency Livestock Credit Act by Congress,
which was scheduled for termination July 25, 1975, unless the Secre-
upon the following two premises: (1) that the Emergency
tary extended it six months under his discretionary authority, until
Livestock Program will continue as a guaranteed loan pro-
gram. and (2) that loans will be made at interest rates agreed
December 31, 1976, should serve as clear evidence to the financial com-
upon by the borrower and lender.
4
5
S. 1236, as amended and reported by the Committee, does nothing
considerable testimony before the Subcommittee on Livestock and
to infringe upon either of these two premises.
Grains, on March 5, 1975, which received testimony on H.R. 48, where-
in several witnesses among whom were livestock producers provided
BRIEF EXPLANATION OF S. 1236 AS AMENDED BY THE HOUSE
testimony on the dire economic straits of those in the beef cattle
The bill as reported by the Committee-
industry.
1. Amends the Emergency Livestock Credit Act of 1974 as follows:
The witnesses who testified before the Subcommittees on the farm
(a) Permits the Secretary to use the Federal Financing Bank
economic and credit situation, especially as it affected livestock pro-
as a service agency to provide a secondary market for the guaran-
ducers, consisted of livestock producers, farm organizations, Depart-
teed portions of emergency livestock loans. The purpose of it is
ment of Agriculture officials, and Members of Congress. Others, such
to extend the availability of credit under this loan program.
as representatives of the American Bankers Association submitted a
(b) Increases the amount of principal and interest that the
statement for the record.
Secretary may guarantee from 80 percent to 90 percent.
The hearing record is replete with statements about the poor eco-
(c) Changes the period of time for loan repayment-from not
nomic situation which livestock producers find themselves in and the
more than 3 years, with a renewal of not more than 2 additional
critical credit needs of these producers that will not be met unless some
changes are made in the Emergency Livestock Credit Act of 1974 so
years-to a period not in excess of 7 years.
(d) Changes the amount of loans which may be guaranteed
that lenders "of last resort" will be enabled to help the farmers avoid
under this Act from total loans not to exceed $250,000 to a "line
financial catastrophe. The need for additional credit relief is fully
of credit," or total principal balance, not to exceed $250,000.
documented in the hearings. The fact that the use of the Emergency
(e) Extends the termination date of the Act from July 25, 1975
Livestock Loan Program is increasing is attested to by Departmental
(plus a 6-month extension beyond that at the conditional discre-
statistics, but its improvement as an emergency credit tool can be sub-
tion of the Secretary) to December 31, 1976, and provides that
stantially enhanced by needed amendments to existing law. The number
the amendments contained in this bill shall take effect on
of borrowers under the program increased from about 1,600 on Febru-
ary 1, 1975, to 1,942 on March 21, 1975. However, out of $2 billion in
enactment. (f) Broadens the authority of the Secretary, if he wishes to
authorized loans, only $232.5 million had been utilized by March 21,
exercise his discretion in the matter, as to the amount and kind
1975.
of collateral he may accept as adequate to protect the Govern-
The amendments to the Emergency Livestock Credit Act of 1974 pro-
vided for in this bill should provide a sound loan program, one that
ment's interests.
(g) Permits the Secretary to utilize the Agricultural Credit
permits rural banks to maintain liquidity while also tiding the live-
Insurance Fund to pay the administrative expenses involved in
stock producers over a grave financial crisis. It is also believed that it
carrying out the loan program authorized by the Act.
will benefit consumers by maintaining the livestock industry in a pos-
(h) Adds a requirement that the Secretary shall report to the
ture where it can produce an optimum amount of beef at prices that
Senate and House Agriculture Committees annually with respect
will provide an adequate return to producers and at reasonable retail
to the effectiveness of the Act, and delineates certain information
prices.
On March 14, 1975, the Subcommittee on Livestock and Grains sit-
to be included in such report.
2. Amends Section 316 of the Consolidated Farm and Rural Devel-
ting jointly with the Subcommittee on Conservation and Credit met in
opment Act by providing that if two or more loans are consolidated
open business meeting, a quorum being present, for the purpose of
and renewed, the renewal period shall be computed from the due date
considering amendments to the Emergency Livestock Credit Act of
of the most recent loan that was obtained by the borrower.
1974 and approved by voice vote a draft bill, amended in the meeting,
which was introduced as H.R. 5235.
COMMITTEE CONSIDERATION
The full Committee met in an open business meeting on Wednesday,
March 26, 1975, in the presence of a quorum, and considered H.R. 5235
The Subcommittee on Livestock and Grains sitting jointly with the
and S. 1236, which had passed the Senate and had been referred to the
Subcommittee on Conservation and Credit held a hearing on March 13,
Committee on March 21, 1975. The Committee by voice vote ordered
1975, to receive testimony to consider changes in the Emergency
S. 1236 favorably reported, as amended, by striking all after the en-
Livestock Credit Program. In addition, the Subcommittee on Conser-
acting clause and by amending the title.
vation and Credit held hearings on February 18, 1975, on H.R. 2127,
The Committee substitute makes the following main changes in S.
and other related bills, to amend subtitle C of the Consolidated Farm
1236, as passed by the Senate:
and Rural Development Act to provide for emergency loans for farm-
First, it would not amend section 2(a) of the Emergency Livestock
ers suffering natural disasters, etc. The latter hearing involved testi-
Credit Act, as does the Senate, SO as to permit the extension of finan-
mony concerning the general farm credit situation and the "arctic
cial assistance to bona fide farmers and ranchers "who have substan-
hurricane" which struck the Midwest in early January 1975, and
tial operations in" the breeding, raising, fattening, or marketing of
resulted in considerable losses to livestock producers. There was also
livestock.
7
6
stock Credit Act by subsection (f) of section 1 of the bill would
Second, subsection (b) of section (2) of the Emergency Livestock
have the effect of liberalizing the collateral considerations of the
Act is amended, but by using different language, SO as to permit the
Secretary to the extent possible given the language in the introductory
secondary financing of the guaranteed portion of livestock loans
part of section 4 which states that loans "shall be secured by collateral
through the Federal Financing Bank.
adequate to protect the Government's interests, as determined by the
Third, subsection (f) of section 2 of the Emergency Livestock Act
Secretary."
is amended SO as to permit loans for a period up to 7 years without
The intent of the Committee in drafting the language to amend
renewal, whereas the Senate version would have also permitted a
section 4 of the Emergency Livestock Act, as reported, was to pro-
renowal for not more than 3 additional years.
vide for "softer" loans under the Emergency Livestock Credit Act
Fourth, subsection (a) (3) of section 3 of the Emergency Livestock
as it was to be amended. How "soft" those loans could be would rest in
Act is amended SO as to provide a line of credit up to $250,000, in lieu
the discretion of the Secretary.
of $500,000 as provided in the Senate version.
However, it should be clearly understood that the Committee does
Fifth, section 4 of the Emergency Livestock Act is amended to
not intend that the Secretary accept as collateral commercial or other
permit the Secretary to accept collateral which has depreciated in
instruments evidencing a debt, financial obligation, or ownership in
value owing to economic conditions and which in the opinion of the
a legal entity, having no ascertainable value, or value of a speculative
lender, together with the lender's confidence in the borrower's repay-
nature.
ment ability, is adequate security for the loan. Senate version contains
The full Committee ordered S. 1236 reported after striking every-
no such provision.
thing after the enacting clause and substituting the House language
Sixth, a new section 11 is added to the Emergency Livestock Act,
therefore. The title was also amended.
that requires the Secretary to report to the House Committee on
Agriculture and the Senate Committee on Agriculture and Forestry
ADMINISTRATION POSITION
on the effectiveness of the Act accompanied by recommendations on
actions which might be taken to decrease the price spread and increase
The following letter forwarded to the Chairman by J. Phil Camp-
the consumption of beef. Senate version contains no such provision.
bell, Acting Secretary, under date of March 25, 1975, sets forth the
Seventh, it would not require, as does the Senate version, that loan
position of the Departmnet of Agriculture on H.R. 5235, which was
applications be processed within 30 days.
the bill the full Committee worked on in markup and the principal
Eighth, it would amend section 316 of the Consolidated Farm and
language of which was incorporated into S. 1236 as reported by the
Rural Development Act (75 Stat. 311, as amended, 82 Stat. 771) such
Committee:
that if two or more loans are consolidated, the renewal period shall
DEPARTMENT OF AGRICULTURE,
be computed from the due date of the most recent loan. The Senate
OFFICE OF THE SECRETARY,
version contains no such provision.
Washington, D.C., March 25, 1975.
Ninth, it would not amend section 344 of the Consolidated Farm and
Hon. THOMAS S. FOLEY,
Rural Development Act (86 Stat. 667) regarding loan limitations as
House of Representatives,
does the Senate version of the bill.
Washington, D.C.
The Committee considered language that would have amended sec-
DEAR ToM: The Department of Agriculture supports H.R. 5235
tion 4 of the Emergency Livestock Act so that the lender, not the
with the exception of section (f), which amends section 4 of Public
Secretary, determined whether the 90 percent loan guarantee of the
Law 93-357 to provide that the lender will determine the adequacy
Government was adequately protected, and also would have permitted
of security in Guaranteed Emergency Livestock loans.
the lender, not the Secretary, to accept collateral, which, though de-
The section says: "Loans guaranteed under this Act shall be se-
preciated in value due to temporary economic conditions, when taken
cured by collateral adequate to protect the Government's interests,
together with the confidence in the borrower to repay the loan, would
as determined by the lender Provided, That the lender may accept col-
provide adequate security for the loan. The Department of Agricul-
lateral which has depreciated in value owing to temporary economic
ture opposed such a provision for reasons as is noted in the letter ap-
conditions and which, in the opinion of the lender, together with his
pearing hereinafter. The Committee resolved the matter, so as to
overcome the Department's objection, by substituting the word "Sec-
confidence in the repayment ability of the borrower, is adequate se-
retary" immediately before and after the word "Provided" in sub-
curity for the loan."
Exception to this section is based on these reasons:
section (f) of section 1 of the bill, as amended.
Another amendment considered, but not included in the bill as
1. The provision removes any government control over the security
of the loan and leaves the Secretary no way in which to protect the
reported, was a provision that would have permitted claimant-credi-
tors of American Beef Packing, Inc., to use claims certified by the
interest of the Government. The lender has no real incentive to pro-
tect the Government's interest.
trustee in bankruptcy as security for emergency livestock loans. Such
a provision was not accepted by the Committee because it was con-
2. While the provision speaks to loss of value due to temporary
sidered that the language added to section 4 of the Emergency Live-
economic conditions, in a loan program designed to meet such condi-
9
8
Next in line came dairy operations with 10 percent of the
tions, it is especially important that the Secretary have responsibility
loans and 6 percent of the dollars, followed in descending
for tailoring security requirements to those conditions SO as to insure
order by swine and chickens. Combinations of one or more
that the program does not become a give-away and undermine lender
livestock enterprises involved 14 percent of the loans and 12
confidence in other Farmers Home Administration (FmHA) pro-
grams which require adequate collateral and repayment capability.
percent of the dollars.
Since the average loan is about $123,000 and loans for beef
3. Under the proposed language of section 4, there is no practical
producers running on the average about $136,000, we do not
way the Department can administer the program on a uniform basis as
individual lenders will use their own method and judgment in deter-
believe it necessary to authorize a higher loan limit than the
current $250,000 maximum.
mining adequacy of security.
A number of specific suggestions have been made in pro-
Sincerely,
J. PHIL CAMPBELL,
posed legislation. Here are changes which the Administration
Acting Secretary.
can support.
First among these would be an amendment to permit the
Assistant Secretary of Agrículture William W. Erwin read the fol-
Federal Financing Bank to participate in the program to
lowing statement into the record at the Subcommittee hearings, which
the extent of being a holder of the guaranteed portion of
further sets forth the position of the Department on certain of the
such loans.
amendments of the Emergency Livestock Credit Act of 1974 that are
Presently the Bank is excluded by law. We would not favor
changing the exclusion to allow the Federal Financing Bank
contained in S. 1236 as reported by the Committee:
to make loans directly to farmers and ranchers. The Federal
Chairman and Committee Members, I thank you for the
Financing Bank's participation should be limited to pur-
opportunity to appear here to discuss a subject that is of con-
chasing and holding the guaranteed portion of loans made
cern to all of us, and one that has a direct and important effect
by other lenders.
on a major section of American agriculture.
Eliminating the exclusion as a holder could improve the
Some changes in the Emergency Livestock Credit Act of
basis for a secondary market for guaranteed loans and in-
1974 would have the support of the Administration, based
crease the funds available to rural banks for loans. We believe
upon the following two premises: (1) that the Emergency
that this change could have a beneficial effect on this program.
Livestock Program will continue as a guaranteed loan pro-
However, we would expect that private lending institutions
gram, and (2) that loans will be made at interest rates agreed
would be the primary purchasers of the guaranteed portion
upon by the borrower and the lender.
of the loans, I would like to make it clear that our support
We are in accord with the benefits being provided to bona
of this change with regard to the Federal Financing Bank
fide ranchers and farmers. In carrying out the intent of the
does not in any way state or imply any commitment or obliga-
Act, the Department has required that eligible borrowers be
tion on the part of the Federal Financing Bank to partici-
engaged in agricultural production with the funds being used
pation in this program.
for the purpose of raising, breeding, fattening or marketing
A change in the guarantee from 80 percent of any loss
livestock.
to up to 90 percent of the principal and interest of the total
Our regulations reinforce this concept of helping the family
loan would be acceptable. We understand the intent is to
farmer-the livestock producer whose access to credit sources
guarantee a lender for up to 90 percent of principal and
may be limited.
interest until such time as the loan is paid off.
The program has not been used as widely by farmers and
This change would provide a procedure for the secondary
ranchers as originally thought by some. We are pleased to
market to operate. We would be opposed to a provision re-
report, however, that as of March 7, 1975, 1,811 borrowers
ferring to 90 percent of payments due, because such a pro-
have had $218.1 million guaranteed under this program.
vision could have the effect of providing more than a 90
The number of loans increased by 200 between February 28
percent guarantee.
and March 7, so we may be entering a period of accelerated
A third change we could support would be to institute a
use of this program.
flexible repayment schedule for borrowers, by giving the Sec-
Farmers involved with beef cattle lead the list of borrowers.
retary authority to determine the length of the repayment
Statistics do not show whether a borrower is primarily in-
period up to seven years, based on a case-by-case analysis of
terested in feedlots, cow-calf operations, or one of the many
each borrower's repayment ability and the type of loan
variations in breeding, growing, fattening and marketing
security.
beef animals.
Such a provision would also provide more latitude in
We know that, as of January 31, 1975, 70 percent of the
working with the individual private lenders.
borrowers and 78 percent of the money involved the beef cat-
As to the fourth suggestion, the concept of a line of credit
tle business.
to a borrower is acceptable in principle. Such action would
H. Rept. 125, 94-1-2
10
11
allow borrowers a great deal more latitude in running their
operations.
which has depreciated in value owing to temporary economic con-
Since the results of the economic squeeze may cause credit
ditions and which in the opinion of the lender, together with his
problems there is a possibility that a borrower would need
confidence in the repayment ability of the borrower, is adequate
to return for an additional guaranteed loan. Thus, we would
security for the loan.
support amending the Act to provide that the total loans
Existing law provides that loans guaranteed under the Act "shall be
guaranteed under the Act for any applicant cannot exceed
secured by security adequate to protect the Government's interests, as
$250,000 at any one time.
determined by the Secretary. The added language would have the
Finally, there has been interest in extending the period
effect of liberalizing somewhat the collateral considerations of the
for which the Emergency Livestock Credit Act is in effect.
The Administration can support an extension of the Act
Secretary. Subsection (g) amends section 5 of the Act so as to permit the
until December 31, 1976.
Secretary to utilize the Agricultural Credit Insurance Fund to pay the
administrative expenses of the emergency livestock loan program.
SECTION-BY-SECTION ANALYSIS
That fund may not be so utilized under existing law.
,Subsection (h) amends the Act by adding a new section 11 which
Section 1. Amendments to the Emergency Livestock Credit Act of 197.4
reads as follows:
(88 Stat. 392)
SEC. 11. The Secretary shall report to the Committèe on
Section 1 extends and amends the Emergency Livéstock Credit Act
Agriculture, U.S. House of Representatives, and the Com-
of 1974 as follows:
mittee on Agriculture and Forestry, U.S. Senate, on or within
,Subsection (a) amends subsection (b) of section 2 of the Act by
one year of the date of the enactment of this section, and an-
striking everything following the word "Provided" and inserting in
nually thereafter, with respect to the effectiveness of this Act.
lieu thereof "That the term 'legally organized lending agency' shall be
The Secretary shall be required, but not limited, to include
deemed to include the Federal Financing Bank only to the extent that
in such report the number of loan applications submitted, the
such Bank may hold guaranteed portions of such loans. The addition
number and amount of loans approved, the financial situation
of this language would permit the secondary financing of the guaran-
facing cattlemen at the time of:the report, the effect of this
teed portions of livestock loans through the Federal Financing Bank.
Act on the retail marketing of beef and on the farm-retail
Subsection (b) also amends section 2 of the Act by striking every-
price spread of beef, and any recommendations he may have
thing after the word "Secretary" and inserting the words "to guaran-
as to actions which can be taken to further decrease the price
tee more than 90 per centum of the principal and interest on said
spread and to increase the consumption of beef.
loan." Existing law provides that no contract guaranteeing loans
There is no reporting requirement in existing law.
by a lender shall require the Secretary to participate in "more than
Section 2. Amendment to the Consolidated Farm and Rural Dévelop-
80 per centum of any loss sustained thereon".
,Subsection (c) also amends section 2 of the Act to read "Loans guar-
ment Act
anteed under this Act may be payable over a period of time as deter-
Section 2 amends section 316 of the Consolidated Farm and Rural
mined by the Secretary, but not to exceed seven years." The law now
Development Act to provide that if two or more farm operating loans
provides that guaranteed loans must be payable in not more than
are consolidated, the renewal period shall be computed from the due
three years, but may be renewed for not more than two additional
date of the most recent loan.
years.
Subsection (d) amends subsection (a) (3) of section 3 of the Act by
COST ESTIMATE
deleting everything after the words "Provided, That" and inserting in
Pursuant to clause 7 of Rule XII of the Rules of the House of
lieu thereof "the total principal balance outstanding at any one time
Representatives, the following is the Committee estimate of the costs
on loans guaranteed under this Act for any borrower shall not exceed
which would be incurred in carrying out the provisions of this bill.
$250.000;" Under existing law, livestock loans are handled on a "one-
No formal estimate of costs has been received from the Department
time" guarantee basis with an overall credit limit of $250,000.
of Agriculture. However, all loans are to be guaranteed; and, there-
Subsection (e) amends section 8 of the Act SO as to legislatively ex-
fore, no direct costs to the Treasury are anticipated at this time. It
tend the Act until December 31, 1976. Existing law provides for term-
should also be noted that the Act will terminate December 31, 1976.
ination of the Act on July 25, 1975, unless the Secretary after making
It is estimated that there will be no direct costs added to the adminis-
certain findings, extends the guarantee authority for a period not in
tration of this program for fiscal year 1975. Moreover, it is not ex-
excess of six months.
pected that the Secretary will incur any losses by reason of defaults
Subsection (f) amends section 4 of the Act to read as follows:
on loans in fiscal year 1975. What loss experience is anticipated by the
Loans guaranteed under this Act shall be secured by collateral
Department for future years is based on the experience of the Small
adequate to protect the Government's interests, as determined by
Business Administration for similar loan programs, inasmuch as
the Secretary Provided, That the Secretary may accept collateral
the emergency livestock loan program has not been in existence long
12
13
enough to provide the Department with a basis for making loss esti-
Sec. 2. (a) The Secretary of Agriculture is authorized and directed
mates. Whatever administrative expenses are expended from the Agri-
to provide financial assistance to bona fide farmers and ranchers who
cultural Credit Insurance Fund under the discretion of the Secretary,
are primarily and directly engaged in agricultural production for the
as provided in this bill, also cannot be determined at this time and
purpose of breeding, raising, fattening, or marketing livestock. In
will have to be budgeted for by the Department of Agriculture in
the case of corporations or partnerships, such financial assistance
future years.
shall be extended only when a majority interest in such corporations
INFLATIONARY IMPACT STATEMENT
or partnerships is held by stockholders or partners who themselves are
Pursuant to clause 2(1) (4), Rule XI of the Rules of the House of
primarily and directly engaged in such agricultural production. For
Representatives, the Committee estimates that enactment of S. 1236
purposes of this Act, the term "livestock" shall mean beef cattle, dairy
could possibly have some minor inflationary impact on consumer prices
cattle, swine, sheep, goats, chickens, and turkeys.
and costs of beef products; nonetheless, the Committee is convinced
(b) The Secretary shall guarantee loans, including both principal
that this is more than offset by other beneficial effects of the legislation
and interest, made by any legally organized lending agency which
on the important national resource of a sound livestock industry and,
otherwise meet the purposes and conditions of this Act. As used herein,
in fact, is essential to offset the critical credit needs impacting on the
a guaranteed loan is one which is made, held, and serviced by a legally
livestock producers of the nation.
organized lending agency and which is guaranteed by the Secretary
hereunder: Provided, [That the term "legally organized lending
BUDGET ACT COMPLIANCE (SECTION 308 AND SECTION 403)
agency" shall not be deemed to include the Federal Financing Bank.]
That the term "tegally organized lending agency: shall be deemed to
The provisions of clause (3) (B) and clause (1) (3) (C) of Rule X
include the Federal Financing Bank only to the extent that such Bank
of the House of Representatives, and Section 308 and Section 403
may hold the guaranteed portion of such loans.
of the Congressional Budget Act of 1974 (relating to estimates of new
(c) No contract guaranteeing any such loan by a lender shall re-
budget authority on new or increased tax expenditures and estimate
quire the Secretary [to participate in more than 80 per centum of any
in comparisons prepared by the Director of the Congressional Budget
loss sustained thereon.] to guarantee more than 90 per centum of the
Office), are not considered applicable.
principat and interest on such loan.
(d) No fees or charges shall be assessed by the Secretary for any
OVERSIGHT STATEMENT
guarantee provided by him under this Act.
(e) Loans guaranteed under this Act shall bear interest at a rate
No specific oversight activities, other than the hearings accompany-
to be agreed upon by the lender and borrower.
ing the Committee's consideration of S. 1236 (and H.R. 5235 and
[(f) Loans guaranteed under this Act shall be payable in not more
related bills), were made by the Committee, within the definition of
than three years, but may be renewed for not more than two addi-
clause 2 (b) (1) of Rule X of the House.
tional years.]
No summary of oversight findings and recommendations made by
(f) Loans guaranteed under this Act may be payable over a period
the Committee on Government Operations under clause 2(b) (2)
of time as determined by the Secretary, but not to exceed seven years.
Rule X of the Rules of the House of Representatives was available to
SEC. 3. As a condition of the Secretary's guaranteeing any loan
the Committee with reference to the subject matter specifically
under this Act-
addressed by S. 1236.
(a) The lender shall certify that-
(1) the lender is unwilling to provide credit to the loan appli-
CHANGES IN EXISTING LAW
cant in the absence of the guarantee authorized by this Act;
(2) the loan applicant is directly and in good faith engaged in
In compliance with clause 3 of Rule XIII of the Rules of the House
agricultural production, and the financing to be furnished the loan
of Representatives, changes in existing law made by the bill are
applicant is to be used for purposes related to the breeding, raís-
shown as follows (existing law proposed to be omitted is enclosed in
ing, fattening, or marketing of livestock;
black brackets, new matter is printed in italic, and existing law in
(3) the loan is for the purpose of maintaining the operations of
which no change is proposed is shown in roman)
the loan applicant, and the total loans made to the loan applicant
do not exceed the amount necessary to permit the continuation of
EMERGENCY LIVESTOCK CREDIT ACT OF 1974
his livestock operations at a level equal to its highest level during
the eighteen months immediately preceding the date of enactment
AN ACT To provide temporary emergency livestock financing through the
establishment of a guaranteed loan program
of this Act: Provided, That [the total loans guaranteed under
this Act for any loan applicant shall not exceed $250,000;] the
Be it enacted by the ,Senate and House of Representatives of the
total principal balance outstanding at any one time on loans guar-
United States of America in Congress assembled, That this Act may
anteed under this Act for any borrower shall not exceed $250,000;
be cited as the "Emergency Livestock Credit Act of 1974".
(4) in the case of any loan to refinance the livestock operations
of a loan applicant (i) the loan and refinancing are absolutely
14
15
essential in order for the loan applicant to remain in business, (ii)
the lending agency-would not refinance such loan in the absence
SEC. 10. The Secretary is authorized to issue such regulations as he
of a guarantee, and (iii) the lending agency is not currently re-
determines necessary to carry out this Act. The proposed regulations
financing similar loans to others without such guarantees.
shall be issued as soon as possible, but in no event later than thirty
(b) The loan applicant shall certify that he will be unable to obtain
days from the date of enactment of this Act.
financing in the absence of the guarantee authorized by this Act.
SEC. 11. The ,Secretary shall report to the Committee on Agriculture,
(c) The Secretary finds there is reasonable probability of accom-
U.S. House of Representatives, and the Committee on griculture and
plishing the objectives of the Act and repayment of the loan.
Forestry, U.S. Senate, on. or within one year of the date of the enact-
SEC. 4. [Loans guaranted under this Act shall be secured by security
ment of this section, and annually thereafter, with respect to the effec-
adequate to protect the Government's interests, as determined by the
tiveness of this Act. The ,Secretary shall be required, but not limited,
Secretary." Loans guaranteed under this Act shall be secured by col-
to include in such report the number of loan applications submitted,
lateral adequate to protect the Government's interests, as determined
the number and amount of loans approved, the financial situation
by the Secretary: Provided, That the Secretary may accept collateral
facing cattlemen at the time of the report, the effect of this Act on
which has depreciated in value owing to temporary economic condi-
the retail marketing of beef and on the farm-retail price spread of
tions and which in the opinion of the lender, together with his confi-
beef, and any recommendations he may have as to actions which can
dence in the repayment ability of the borrower, is adequate security for
be taken to further decrease the price spread and to increase the con-
the loan.
sumption of beef.
SEC. 5. Loan guarantees outstanding under this Act shall not exceed
$2,000,000,000 at any one time. Subject to the provisions of section
CONSOLIDATED FARM AND RURAL DEVELOPMENT ACT
(c) of this Act, the fund created in section 309 of the Consolidated
*
Farm and Rural Development Act shall be used by the Secretary for
the discharge of the obligations of the Secretary under contracts of
SEC. 316. The Secretary shall make all loans under this subchapter
guarantee made pursuant to this Act. Such fund may aslo be utilized
upon the full personal liability of the borrower and upon such security
to pay administrative expenses of the ,Secretary necessary to carry
as the Secretary may prescribe. Such loans shall be payable in not
out the provisions of this Act.
more than seven years, but may be renewed for not more than five
SEC. 6. Contracts of guarantee under this Act shall not be included
additional years , except that if two or more loans are consolidated
in the totals of the budget of the United States Government and shall
the renewal period shall be computed from the due date of the most
be exempt from any general limitation imposed by statute on expendi-
recent loan. Loans made under this subchapter shall bear interest at
tures and net lending (budget outlays) of the United States.
a rate determined by the Secretary of the Treasury taking into con-
SEC. 7. Any contract of guarantee executed by the Secretary under
sideration the current average market yield on outstanding marketable
this Act shall be an obligation supported by the full faith and credit
obligations of the United States with remaining periods to maturity
of the United States and incontestable except for fraud or misrepre-
comparable to the average maturities of such loans, adjusted to the
sentation of which the holder had actual knowledge at the time it
nearest one-eighth of 1 per centum, plus not to exceed 1 per centum
became a holder.
per annum as determined by the Secretary.
SEC. 8. [The provisions of this Act shall become effective upon enact-
ment, and the authority to make new guarantees under this Act shall
terminate one year from the date of enactment of this Act, except that
the Secretary of Agriculture may extend the guarantee authority pro-
vided in this Act for a period not to exceed six months if he (1) deter-
mines that such guarantees are necessary to the welfare of livestock
producers and that adequate credit cannot be obtained without such
guarantee by the Secretary, and (2) notifies the Committee on Agri-
culture and Forestry of the Senate and the Committee on Agriculture
of the House of Representatives at least thirty days prior to the date
on which he elects to extend the guarantee authority provided in the
Act.] The provisions of this Act shall become effective upon enact-
ment, and the authority to make new guarantees under this Act shall
terminate on December 31, 1976.
Sec. 9. (a) The provisions of section 310B (d) (6) of the Consoli-
dated Farm and Rural Development Act shall apply to loans guaran-
teed under this Act.
(b) Contracts of guarantee executed pursuant to the provisions of
this Act shall be fully assignable.
Union Calendar No. 52
94TH CONGRESS
1ST SESSION
S. 1236
[Report No. 94-125]
IN THE HOUSE OF REPRESENTATIVES
MARCH 21, 1975
(1)
Referred to the Committee on Agriculture
APRIL 7, 1975
Reported with amendments, committed to the Committee of the Whole House
on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed in italic]
AN ACT
To extend and amend the Emergency Livestock Credit Act
of 1974, and for other purposes.
1
Be it enacted by the Senate and House of Representa-
2 tives of the United States of America in Congress assembled,
3 That the Emergency Livestock Credit Act of 1974 (88 Stat.
4 391) is amended as follows:
5
(a) Section 2 is amended
6
(1) By striking "for the purpose of" in the first
7
sentence of subsection (a) and inserting in lieu thereof
8
the following: "and who have substantial operations in".
9
(2) By changing the colon after the word "here-
10
under" in subsection (b) to a period and striking the
11
remainder of subsection (b).
I
FORD is LIBRARY GENALD
2
3
1
(3) By striking all of subsection (c) after the word
1 tive upon enactment, and the authority to make new guaran-
2
"Secretary" and inserting the following in lieu thereof:
2 tees shall terminate on December 31, 1976.".
3
"to guarantee more than 90 per centum of the principal
3
(c) Section 10 is amended by adding at the end thereof
4
and interest on such loan.".
4 the following new sentence: "Insofar as practicable, the See-
5
(4) By changing subsection (f) to read as follows:
5 retary shall complete action on each loan application within
6
"(f) Loans guaranteed under this Act shall be for the
6 thirty days after its receipt.".
7 period reasonably required by the needs of the borrower,
7
SEC. 2. Section 344 of the Consolidated Farm and Rural
8 taking into consideration the security the borrower has avail-
8 Development Act (86 Stat. 667) is amended by changing
9 able, but not exceeding an original term of seven years.
9 the last sentence thereof to read as follows: "No contract
10 Loans may be renewed for not more than three additional
10 guaranteeing any such loan by such other lender shall require
11 years.".
11 the Secretary to guarantee more than 90 per centum of the
12
(b) Section 3 is amended by striking all of paragraph
12 principal and interest on such loan.".
13 (3) of subsection (a) after the words Provided, That"
13 That the Emergency Livestock Credit Act of 1974 is
14 and inserting in lieu thereof the following: "the total prin-
14
amended
as
follows:
15 cipal balance outstanding at any one time on loans guaran-
15
(a) Subsection (b) of section 2 of said Act is amended
16 teed under this Act for any borrower shall not exceed
16 by striking everything following the word "Provided" and
17 $500,000;".
17 inserting in lieu thereof "That the term legally organized
18
(c) Section 5 is amended by adding at the end thereof
18 lending agency' shall be deemed to include the Federal Fi-
19 the following new sentence: "In the administration of this
19 nançing Bank only to the extent that such Bank may hold
20 Act, the Secretary may utilize any funds available, including
20 the guàranteed portion of such loans.".
21 the Agricultural Credit Insurance Fund, to pay for adminis-
21
(b) Subsection (c) of section 2 of said Act is amended
22 trative expenses notwithstanding any limitations imposed for
(S)
22 by striking everything after the word "Secretary" and insert-
23 budgetary reasons.".
23 ing "to guarantee more than 90 per centum of the principal
24
(d) Section 8 is amended to read as follows:
24 and interest on said loan.".
25
"SEC. 8. The provisions of this Act shall become effec-
25
(c) Subsection (f) of section 2 of said Act is amended
4
5
1 to read: "Loans guaranteed under this Act may be payable
1 utilized to pay administrative expenses of the Secretary neces-
2 over a period of time as determined by the Secretary, but
2 sary to carry out the provisions of this Act.34b out mort S
3 not to exceed seven years.".
30 (h) Said Act is amended by adding at the end thereof the
4
(d) Subsection (a) (3) of section 3 of said Act is
4 bas tiberO Abotaovil vonegromH
following new section 11:
".10A [втя has mall betebiloano odi to
5 amended by deleting everything after the words "Provided,
5
"SEC. 11. The Secretary shall report to the Committee
(SI doreM ,VBb ovits[aigo]) 08 doreM
6 That" and inserting in lieu thereof "the total principal bal-
6 on Agriculture, United States House of Representatives, and
7 ance outstanding at any one time on loans guaranteed under
7 the Committee on Agriculture and Forestry, United States
,OMIAV ,Я
8 this Act for any borrower shall not exceed $25,000;"
8 Senate; on or within one year of the date of the enactment of
9
(e) Section 8 of said Act is amended to read as follows:
9 this section, and annually thereafter, with respect to the effec-
10 "The provisions of this Act shall become effective upon enact-
10 tiveness of this Act. The Secretary shall be required, but not
11 ment, and the authority to make new guarantees under this
11 limited, to include in such report the number of loan applica-
12 Act shall terminate on December 31, 1976.".
12 tions submitted, the number and amount of loans approved, the
13
(f) Section 4 of said Act is amended to read as follows:
13 financial situation facing cattlemen at the time of the report,
14 "Loans guaranteed under this Act shall be secured by col-
14 the effect of this Act on the retail marketing of beef and on the
15 lateral adequate to protect the Government's interests, as de-
15 farm-retail price spread of beef, and any recommendations
16 termined by the Secretary: Provided, That the Secretary
16 he may have as to actions which can be taken to further de-
17 may accept collateral which has depreciated in value owing
17 crease the price spread and to increase the consumption of
18 to temporary economic conditions and which in the opinion
18 beef."
19 of the lender, together with his confidence in the repayment
19
SEC. 2. Section 316 of the Consolidated Farm and
20 ability of the borrower, is adequate security for the loan.".
20 Rural Development Act is amended by striking the period at
21
(g) Section 5 of said Act is amended by adding a new
21 the end of the first sentence and inserting after the words
22 sentence at the end thereof stating, "Such fund may also be
22 "additional years" the following: "except that if two or more
(5)
6
1 loans are consolidated the renewal period shall be computed
2 from the due date of the most recent loan."
Amend the title so as to read: "An Act to amend the
Emergency Livestock Credit Act of 1974 and section 316
of the Consolidated Farm and Rural Development Act."
of
Passed the Senate March 20 (legislative day, March 12),
1975.
Attest:
FRANCIS R. VALEO,
Secretary.
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Union Calendar No. 52
94TH CONGRESS
1ST SESSION
S. 1236
Secretary,
[Report No. 94-125]
are consolidated the period shall be computed
Amend the title 80 as to read: "An Act to amend the
AN ACT
from the due date of the most recent loan.".
Emergency Livestock Credit Act of 1974 and section 316
of the Consolidated Farm and Rural Development Act."
Passed the Senate March 20 (legislative day, March (2)
ORTVA H SIONY I
To extend and amend the Emergency Livestock
Credit Act of 1974, and for other purposes.
MARCH 21, 1975
Referred to the Committee on Agriculture
APRIL 7, 1975
Reported with amendments, committed to the Com-
mittee of the Whole House on the State of the
Union, and ordered to be printed
THE WHITE HOUSE
WASHINGTON
Charlie --
Hyde Murray called with the following message re
the Farm Bill and veto threat --
Chairman Foley is very surprised and disappointed.
"We believe we acted with moderation and responsi--
bility in consideration and passage of this bill.
"Notwithstanding this threat of a veto it is our
intention to go to conference Monday and iron out
differences in this legislation. 11
Neta
4/11/75
Judy DRAFT Johnster
April 30, 1975 - 7:00 a.m.
OK/6A5 1675
To the House of Representatives:
I am returning without my approval H.R. 4296, referred
to as the Emergency Agricultural Act of 1975. Although the
aim of this bill is laudable, its results would be costly
DY writt damage
to consumers and taxpayers, and damaging to America's economic
recovery and world market position.
would
Approval of this bill would, therefore, not be in the
public interest.
In the conduct of the Government's fiscal affairs, a
line must be drawn against excesses. I drew that line in
my address to the Nation on March 29. I promised all Americans
that, except where Long-range national security interests,
REQUIREMENTS,
energy matters or urgent humanitarian needs were involved,
I would take action to hold our fiscal year 1976 deficit to
no more than $60 billion.
New spending programs which the Congress is considering
could easily raise the Federal deficit to an intolerable level
of $100 billion. This must not happen.
monessental
H.R. 4296 is an example of increased spending which is
not essential. In fiscal year 1976, it could add an estimated
$1.8 billion to the Federal deficit. If used as a point of
departure for longer-term legislation --- as was strongly
FORD is LIBRARY 076838
OK
mit.
4/30/75
- 2 -
indicated during its consideration --- it could lead to an es-
during its imsederation
calation of farm program subisdies in succeeding years.
Approval of this bill would undermine the successful
market-oriented farm policy adopted by this Administration
and the Congress. It is a step backward toward privinaly totally
discredited policies.
Prospects for farmers, it is true, are not as bright
this year as in the recent past. Farm production costs have
been pushed upward by the same inflationary pressures that
affect other industries. At the same time demand for
certain farm products has slackened because of the recession.
This The Administration recognizes ^ farmers have financial
that
It
difficulties due to this cost-price squeeze and has taken a
number of positive steps to assist farmers. The 1976 wheat
acreage allotment was recently increased by 8 million acres
to 61.6 million acres. This action provides wheat producers
with additional target price and disaster protection.
We
have also increased the 1975 crop cotton price support loan
rate by 9 cents a pound. And we recently announced an
increase in the price support level for milk, which, combined
the helpful to
with easing feed prices, should assist dairy producers.
FORD & LIBRARY
- 3 -
Within the past several days, we have completed
negotiations with the European Community to remove the export
subsidies on industrial cheese coming here -- a step that
ensures that surplus dairy products will not be sold in the
U.S. market at cut-rate prices. At the same time, we have
worked out arrangements which enable the Europeans to continue
selling us high-quality table cheese. This solution has
enabled us to keep on mutually agreeable trading terms with
our best customers for American farm exports.
The administration here
We have also taken action to protect our cattle producers
against a potential flood of beef imports from abroad. The
Department of State is completing negotiations with 12 countries
limiting their 1975 exports of beef to this country. These
voluntary export restraint agreements are intended to keep
1.18
imports subject to the Meat Import Law to less than 19:182
2-
million pounds.
In addition, if unforeseen price deterioration requires action
on my part, I will direct the Secretary of Agriculture to make
adjustments in price support loan rates for wheat, corn, soybeans;
and other feed grains. But it is our expectation, that market
prices for grains will remain well above loan rates and target
prices in the coming year.
LIBRARY GERALD R. FORD
- 4 -
Most farmers have already made their plans and bought
their seed. Many are well into their planting season. These
plans have obviously been completed without any dependence
on the provisions of H.R. 4296.
In the long haul, this bill utlimately would lead to
AND
constraints on production resulting in loss of jobs in
food-related industries. It would induce farmers to grow
more cotton - already in surplus -- and less soybeans the
needed for food. The bill would jeopardize the competitive
position of our cotton in world markets.
American farms ERS/ have responded magnificently during the
past several years to produce food and fiber for this Nation
and the world. This has made agriculture our leading source
of foreign exchange. This year, despite very trying circum-
sliking full
stances, most farmers are again going for all out production.
They have my support for a vigorous export policy for their
products. I recognize that agricultural exports have been
pos
restrained twice in the past two years. We have eliminated
irn nose
all restrictions on exports and we are determined not to
supply have them again.
Our farm products must have unfettered access to
FORD & GERALD LIBRARY
world markets.
pulul American
and
This Administration will act to ensure the / : irmer his
Test interests.
fair share ^ It will not act to distort his market. We must
- 5 -
hold the budget line if we are all to enjoy the benefit
of a prosperous, stable, non-inflationary economy.
L in all These reasons,
I cannot approve this act. I return it herewith.
H.
FORD & 938410 LIBRARY
EMBARGOED FOR RELEASE
MAY 1, 1975
UNTIL 6:00 P. M. (EDT)
Office of the White House Press Secretary
THE WHITE HOUSE
TO THE HOUSE OF REPRESENTATIVES:
I am returning without my approval H.R. 4296, referred
to as the Emergency Agricultural Act of 1975. Although the
aim of this bill is laudable, its results would be costly
not only to consumers and taxpayers but to American farmers
in the long run. It would damage our international market
position which is so essential to American agriculture's
long-term interests.
Approval of this bill, therefore, would not be in the
public interest.
In the conduct of the Government's fiscal affairs, a
line must be drawn against excesses. I drew that line in
my address to the Nation on March 29. I promised all
Americans that, except where national security interests,
energy requirements, or urgent humanitarian needs were
involved, I would act to hold our fiscal year 1976 deficit
to no more than $60 billion.
New spending programs which the Congress is considering
could easily raise the Federal deficit to an intolerable
level of $100 billion. This must not happen.
H.R. 4296 is an example of increased non-essential
spending. In fiscal year 1976, it could add an estimated
$1.8 billion to the Federal deficit. If used as a point of
departure for longer-term legislation -- as was strongly
indicated during its consideration -- it could lead to an
escalation of farm program subsidies in succeeding years.
Approval of this bill would undermine the successful
market-oriented farm policy adopted by this Administration
and the Congress. It is a step backward toward previously
discredited policies.
Prospects for farmers, it is true, are not as bright
this year as in the recent past. Farm production costs have
been pushed upward by the same inflationary pressures that
affect other industries. Demand for certain farm products
has simultaneously slackened because of the recession.
Prices paid by farmers are currently 11 percent above
year-ago levels. In contrast, the index of prices received
by farmers is now 7 percent below levels of a year ago.
Fortunately, the latest index, released Wednesday, shows
that the 5-month decline in prices received by farmers
has been reversed and was 4 percent above a month earlier.
The Administration recognizes that some farmers have
experienced financial difficulties due to this cost-price
squeeze. It has taken a number of positive steps to assist
farmers. The 1976 wheat acreage allotment was recently
increased by 8 million acres to 61.6 million acres. This
action provides wheat producers with additional target price
and disaster protection.
more
2
We have also increased the 1975 crop cotton price support
loan rate by 9 cents a pound. And we recently announced an
increase in the price support level for milk, which, com-
bined with easing feed prices, should be helpful to dairy
producers.
Within the past several days, we have completed
negotiations with the European Community to remove the
export subsidies on industrial cheese coming here a
step that ensures that surplus dairy products will not be
sold in the U.S. market at cut-rate prices. At the same
time, we have worked out arrangements which enable the
Europeans to continue selling us high-quality table cheese.
This solution has enabled us to keep on mutually agreeable
trading terms with our best customers for American farm
exports.
The Administration has also taken action to protect
our cattle producers against a potential flood of beef
imports from abroad. The Department of State is completing
agreements with 12 countries limiting their 1975 exports
of beef to this country. These voluntary export restraint
agreements are intended to keep imports subject to the Meat
Import Law to less than 1,182 million pounds.
If unforeseen price deterioration requires action on
my part, I will direct the Secretary of Agriculture to make
adjustments in price support loan rates for wheat, corn,
soybeans, and other feed grains. But it is our expectation
that market prices for grains will remain well above loan
rates and target prices in the coming year.
Most farmers have already made their plans and bought
their seed. Many are well into their planting season.
These plans have obviously been completed without any de-
pendence on the provisions of H.R. 4296.
In the long haul, this bill would lead to constraints
on production and result in loss of jobs in food-related
industries. It would induce farmers to grow more cotton --
already in surplus -- and less soybeans needed for food.
The bill would jeopardize the competitive position of our
cotton in world markets.
American farmers have responded magnificently during
the past several years to produce food and fiber for this
Nation and the world. This has made agriculture our lead-
ing source of foreign exchange. This year, despite very
trying circumstances, most farmers are again seeking full
production. They have my support for a vigorous export
policy for their products. I recognize that agricultural
exports have been restrained twice in the past two years.
We have now eliminated all restrictions on exports and we
are determined to do everything possible to avoid imposing
them again. Our farm products must have unfettered access
to world markets.
more
3
This Administration is determined to act in support
of the American farmer and his best interests. It will
not act to distort his market. We must hold the budget
line if we are all to enjoy the benefits of a prosperous,
stable, non-inflationary economy.
For all these reasons, I cannot approve this act.
GERALD R. FORD
THE WHITE HOUSE,
May 1, 1975.
####
4296 Emergency agriculture act FILE
3944
CONGRESSIONAL RECORD
May 13, 1975
The price of corn would increase approxi-
upward target and loan rates so that
sult of the economic recession we are now
mately 46 percent with a U.S. acreage re-
they would be within the range of the
experiencing. This price will also recover
duction of 9% and exports and domestic use
cost of producing the commodities cov-
and payments may not be necessary. Al-
were to remain unchanged, an Iowa State
ered by the bill according to data sup-
ready, there is a tendency to this effect.
University computer study showed.
plied by land-grant universities around
The bill would have minimal effects on
The point being that without increased
the country.
consumer prices. According to USDA es-
price supports many farmers would re-
Target prices under H.R. 4296 are for
timates, the consumer price of milk
duce their planting.
cotton, 45 cents a pound, wheat, $3.10 a
would increase only about 1 cent a gal-
Moreover, the Christian Science Moni-
bushel, and corn, $2.25 a bushel. Target
lon, and cheese, 1 cent a pound. The
tor stated in an editorial on April 17,
prices are used as a basis for making
price of wheat in a loaf of bread is but a
1975, that-
deficiency and disaster payments to
fraction of the cost of the loaf-less than
If President Ford wants farmers to pro-
producers.
5 cents per pound loaf. More important-
duce up to their maximum as he urges, to
Loan rates under H.R. 4296 are for
ly, if this bill were enacted, farmers
help moderate food prices at home and help
cotton, 38 cents a pound, wheat, $2.50 a
would react in a positive fashion and
feed the hungry abroad, he should sign the
bushel, and corn, $1.87 a bushel. The bill
provide consumers abundant supplies at
farm-price bill. Passage would reduce the risk
also provides a mandatory loan program
fair and reasonable prices.
of the kind of price whiplash that has hurt
for soybeans with support at $3.94 a
I strongly urge my colleagues to join
farmers and consumers in recent years.
bushel-last year USDA abandoned the
with me in overriding the President's
Finally, Mr. Speaker, the inability to
loan program for this important com-
veto.
recognize the importance of this legis-
modity.
Mr. Speaker, I move the previous ques-
lation and the necessity of its passage
Support for milk is established at 80
tion.
can result only in furthering the frus-
percent of parity with quarterly adjust-
The previous-question was ordered.
trations of both the farmer and the con-
ments to reflect changes in production
The SPEAKER. The question is, Will
sumer and the imposition of additional
costs. The 80-percent level is the level at
the House, on reconsideration, pass the
financial burdens on each group.
which milk was supported last year but
bill, the objections of the President to the
Mr. FOLEY. Mr. Speaker, I yield my-
the requirement for quarterly adjust-
contrary notwithstanding?
self the remaining time.
ments provides farmers important pro-
Under the Constitution, this vote must
(Mr. FOLEY asked and-was given per-
tection from the erosion that can occur
be determined by the yeas and nays.
mission to revise and extend his
in the support level from inflationary in-
The vote was taken by electronic de-
remarks.)
creases in production costs.
vice, and there were-yeas 245, nays 182,
Mr. FOLEY.Mr. Speaker, this is a bill
The purpose of the target prices and
not voting 6, as follows:
that has been written in the House of
loan levels is to lend stability to the mar-
[Roll-No. 201]
Representatives. It was written by a bi-
kets for farm products. If our farmers
YEAS-245
partisan majority of the Committee on
are going to produce the food and fiber
Abdnor
Edgar
LaFalce
Agriculture. It was supported by a bi-
needed at home and abroad, if we are
Alexander
Edwards, Calif.
Latta
partisan majority in this House and in-
going to rebuild our reserves to avoid the
Andrews, N.C.
Eilberg
Leggett
the other body, and sustained in the con-
Andrews,
English
Lehman
short supply situation that has plagued
N. Dak.
Evans, Colo.
Litton
ference report by a bipartisan majority.
the country in the recent past, then our
Annunzio
Evins, Tenn.
Lloyd, Tenn.
This is not a partisan bill. It is the work
farmers need the price assurances and
Ashley
Fisher
Long, La.
of the best judgment of the Members of
Aspin
Fithian
Lott
income protection provided by this farm
AuCoin
Flood
McCollister
this Congress, and if I may be excused
bill. The bill is more than just a stabili-
Badillo
Fiorio
McCormack
in saying so, the best informed and most
zation of farm income, 1t places the Na-
Baldus
Flowers
McDade
concerned Members who know agricul-
tion's food and fiber supply in a more
Barrett
Flynt
McEwen
Baucus
Foley
McFall
ture from both sides of the aisle have
secure and stable position. Without it,
Beard, R.I.
Ford, Tenn.
McHugh
supported this bill enthusiastically
there is a clear and present danger farm-
Beard, Tenn.
Fountain
McKay
will not raise the prices to con-
ers would cut back production for fear of
Bedell
Fraser
Mahon
Bergland
Fulton
Mann
sumers. will provide protection for
glutting the market and causing a pre-
Bevill
Fuqua
Mathis
full-production and it will, in my judg-
cipitous drop in farm prices. The bill
Biester
Gaydos
Matsunaga
Giaimo
Meeds
ment, be a step forward to assuring this
gives farmers the kind of assurance
Bingham
Blouin
Gibbons
Melcher
country and all the world that depends
needed to push for the largest possible
Boggs
Ginn
Meyner
upon our productive capacity that there
production.
Bolling
Gonzalez
Mezvinsky
will not be shortages of vital food-or fiber
The President claims that HR. 4296
Bonker
Grassley
Miller, Calif.
Bowen
Green
Mills
we need to provide the life support for
could add an estimated $1.8 billion to the
Brademas
Hagedorn
Mineta
our millions of citizens and for the hun-
Federal deficit. This is predicated on the
Breaux
Hall
Mink
dreds of millions around the world who
Breckinridge
Hamilton
Mitchell, Md.
assumption that commodities put under
Brinkley
Hanley
Moakley
depend upon us.
loan represent a dead loss to the Govern-
Brodhead
Hannaford
Moffett
I urge my colleagues in the House to
ment. This is hardly the case. Govern-
Brooks
Harkin
Montgomery
join me in voting to override the Presi-
ment loan stocks represent another form
Brown, Calif.
Hawkins
Moore
Broyhill
Hayes, Ind.
Moorhead, Pa.
dent's veto of H.R. 4296, the Emergency
of bank account. If the bill-achieves its
Burke, Calif.
Hays, Ohio
Morgan
Agricultural Act of 1975. The President's
objective of keeping prices at stable lev-
Burke, Mass.
Hefner
Moss
veto message tells us why we need the
els, there may be little if any-commodi-
Burleson, Tex.
Henderson
Murphy, III.
Burlison, Mo.
Hicks
Murtha
additional safeguards provided by H.R.
ties taken in under the loan program.
Burton, John
Hightower
Myers, Ind.
4296. As he stated, farm production costs
Farmers who may need immediate cash
Burton, Phillip
Hillis
Natcher
have been pushed upward. Demand for
may pledge their crops to the Govern-
Carney
Holland
Neal
Carr
Howard
Nedzi
certain farm products has simultaneously
ment but during the season would re-
Carter
Howe
Nichols
slackened because of the recession.
deem the commodity and repay the loan
Casey
Hubbard
Nix
Prices paid by farmers are currently 11
with interest. If prices should fall, then
Chappell
Hughes
Nolan
the Government would acquire title to
Chisholm
Hungate
Nowak
percent above year-ago levels. In con-
Clay
Ichord
Oberstar
trast, the index of prices received by
these inventories but with proper man-
Cochran
Jeffords
Obey
farmers is now far below levels of a year
agement could dispose of these stocks
Corman
Jenrette
O'Neill
ago. The Secretary of Agriculture and
as it has in the recent past at a profit
Cornell
Johnson, Calif.
Ottinger
D'Amours
Jones, Ala.
Passman
the land grant universities agree that the
or with little if any cost to the Govern-
Danielson
Jones, N.C.
Patman
current production costs for wheat, feed
ment. The only net costs to the Govern-
Davis
Jones, Okla.
Patterson. Calif
grains and cotton are higher than the
ment of the program would be from the
de la Garza
Jones, Tenn.
Pattison, K.Y.
deficiency and disaster payments. Net
Dellums
Jordan
Perkins
current target prices. These target prices
Dent
Karth
Pickle
and loan levels were established in 1973
outlays under the bill could amount to
Derrick
Kasten
Poage
before inflation saddled our farmers with
approximately $230 million if there were
Diggs
Kastenmeier
Pressler
to be no recovery in prices received by
Dingell
Kazen
Preyer
these marked increases in costs.
Dodd
Keys
Price
Let me summarize briefly the provi-
farmers, particularly cotton farmers.
Duncan, Oreg.
Krebs
Quie
sions of H.R. 4296. The bill would revise
The low price of cotton today is the re-
Eckhardt
Krueger
Randall
FORD
May 13, 1975
CONGRESSIONAL RECORD-HOUSE
H 3945
Rangel
Smith, Iowa
Traxler
The result of the vote was announced
The SPEAKER. The gentleman from
Reuss
Smith, Nebr.
Treen
as above recorded.
Richmond
Snyder
Tsongas
Hawaii (Mr. MATSUNAGA) is recognized
Riegle
Solarz
Udall
The SPEAKER. The Clerk will notify
for 1 hour.
Risenhoover
Spence
Ullman
the Senate of the action of the House.
(Mr. MATSUNAGA asked and was
Roberts
Staggers
Vander Veen
Roncalio
Stanton,
Vigorito
given permission to revise and extend his
Rose
James V.
Waggonner
remarks.)
Roush
Stark
Wampler
GENERAL LEAVE
Mr. MATSUNAGA. Mr. Speaker, I
Runnels
Steed
Waxman
Ryan
Steiger, Wis.
Weaver
Mr. FOLEY. Mr. Speaker, I ask unani-
yield 30 minutes to the gentleman from
Schroeder
Stephens
White
mous consent that all Members may have
California (Mr. DEL CLAWSON), pending
Sebelius
Stokes
Whitten
5 legislative days in which to revise and
which I yield mlself such time as I may
Seiberling
Stuckey
Wilson,
Sharp
Sullivan
extend their remarks on the veto message
consume.
Charles, Tex.
Shipley
Symington
Winn
just under consideration.
Mr. Speaker, House Resolution 445
Shriver
Taylor, Mo.
Wirth
The SPEAKER. Is there objection to
provides for consideration of H.R. 5357,
Sikes
Taylor, N.C.
Wright
the request of the gentleman from Wash-
which, as reported by our Committee on
Simon
Teague
Young, Ga.
Sisk
Thompson
Young, Tex.
ington?
Interstate and Foreign Commerce, would
Skubitz
Thone
Zablocki
There was no objection.
authorize appropriations to the Secretary
Slack
Thornton
of Commerce to promote tourist travel
NAYS-182
within the United States, and also to pro-
PERMISSION FOR COMMITTEE ON
Abzug
Forsythe
Murphy, N.Y.
mote international travel by foreign resi-
Addabbo
Frenzel
Myers, Pa.
RULES TO FILE CERTAIN PRIV-
dents to the United States. The resolu-
Ambro
Frey.
O'Brien
ILEGED REPORTS
tion provides an open rule with 1 hour of
Anderson,
Gilman
O'Hara
Calif.
Goldwater
Patten
Mr. MATSUNAGA. Mr. Speaker, I ask
general debate, with the time being
Anderson, III.
Goodling
Pepper
unanimous consent that the Committee
equally divided and controlled by the
Archer
Gradison
Pettis
Armstrong
Gude
on Rules may have until midnight to-
chairman and ranking minority members
Peyser
Ashbrook
Guyer
Pike
night to file certain privileged reports.
of the Committee on Interstate and For-
Bafalis
Haley
Pritchard
The SPEAKER. Is there objection to
eign Commerce.
Bauman
Hammer-
Quillen
Bell
schmidt
Railsback
the request of the gentleman from
After general debate, the bill would be
Bennett
Rees
Hawaii?
read for amendment under the 5-minute
Hansen
Biaggi
Harrington
Regula
There was no objection.
rule. At the conclusion of the considera-
Blanchard
Harris
Rhodes
tion of H.R. 5357 for amendment, the
Boland
Harsha
Rinaldo
committee will rise and report the bill to
Broomfield
Hastings
Robinson
Brown, Mich.
Hébert
Rodino
PERMISSION FOR COMMITTEE ON
the House with such amendments as may
Brown, Ohio
Hechler, W: Va.
Roe
STANDARDS OF OFFICIAL CON-
have been adopted, and the previous-
Buchanan
Heckler, Mass.
Rogers
DUCT TO SIT DURING GENERAL
question will be considered as ordered on
Burgener
Heinz
Rooney
Burke, Fla.
Helstoski
Rosenthal
DEBATE AND DURING THE 5-
the bill and amendments thereto to final
Butler
Holt
Rousselot
MINUTE RULE TOMORROW
passage without intervening motion ex-
Byron
Holtzman
Roybal
Horton
Ruppe
Mr. FLYNT. Mr. Speaker, I ask unani-
cept one motion to recommit.
Cederberg
Clancy
Hutchinson
Russo
mous consent that the Committee on
Mr. Speaker, tourism is recognized as
Clausen,
Hyde
St Germain
Standards of Official Conduct may sit
big business in the United States. In 46
Don H.
Jacobs
Santini
Jarman
Sarasin
during general debate and during the 5-
States, tourism ranks among the top
Clawson, Del
Cleveland
Johnson, Colo.
Sarbanes
minute rule on tomorrow.
three industries, and in three of these
Cohen
Johnson, Pa.
Satterfield
The SPEAKER. Is there objection to
States, including my own State of
Collins, Ill.
Kelly
Scheuer
Kemp
Schneebeli
the request of the gentleman from
Hawaii, it is the leading industry. Tour-
Collins, Tex.
Conable
Ketchum
Schulze
Georgia?
ism as an industry generates annual rev-
Conlan
Kindness
Shuster
There was no objection.
enues in the total amount of $61 billion,
Conte
Koch
Spellman
and provides over 4 million jobs to Amer-
Conyers
Lagomarsino-
Stanton,
icans. In view of the current depressed
Cotter
Landrum
J. William
Coughlin
Lent
Steelman
state of our economy, it is particularly
Crane
Levitas
Steiger, Ariz.
AUTHORIZING
APPROPRIATIONS
noteworthy that tourism increases Fed-
Daniel, Dan
Lloyd, Calif:
Stratton
FOR TOURIST TRAVEL PROMO-
eral, State, or local tax receipts.
Daniel, Robert
Long, Md.
Studds
TION
W., Jr.
Lujan
Symms
Despite this seemingly rosy picture, the
Daniels,
McClory
Talcott
McCloskey
Van Deerlin
Mr. MATSUNAGA. Mr. Speaker, by
tourism industry- is actually-operating
Dominick V.
Delaney
McDonald
Vander Jagt
direction of the Committee on Rules, I
considerably below capacity level. For ex-
Derwinski
McKinney
Vanik
call up House Resolution 445 and ask for
ample, it has been reported that U.S.
Devine
Macdonald
Walsh
its immediate consideration.
hotels and motels are presently operating
Dickinson
Madden
Whalen
Madigan
Whitehurst
The Clerk read the resolution as
only 30 percent of capacity. Further-
Downey. N.Y.
Downing, Va.
Maguire
Wiggins
follows:
more, from an estimated 85 million per-
Drinan
Martin
Wilson, Bob
H. RES. 445
sons throughout the world who have the
Duncan, Tenn.
Mazzoli
Wilson,
Charles H.,
Resolved, That upon the adoption of this
means to travel to the United States, we
du Pont
Metcalfe
Early
Michel
Calif.
resolution it shall be in order to move that
have, over a period of years, managed to
Edwards, Ala.
Mikva
Wolff
the House resolve itself into the Committee
induce only a relatively small number to
Emery
Milford
Wydler
of the Whole House on the State of the
visit this country.
Erlenborn
Miller, Ohio
Wylie
Union for the consideration of the bill (HR.
Esch
Minish
Yates
The U.S. Travel Service, which as es--
Eshleman
5357) to authorize appropriations to the
Mitchell, N.Y.
Yatron
tablished in the Department of Com-
Fascell
Moorhead,
Young, Alaska
Secretary of Commerce for the promotion of
Calif.
Young, Fla.
tourist travel. After general debate, which
merce by Congress in 1961 and given
Fenwick
Findley
Mosher
Zeferetti
shall be confined to the bill and shall con-
broader responsibilities in 1970, reports
Fish
Mottl
tinue not to exceed one hour, to be equally
that the U.S. net balance-of-payment
NOT VOTING-6
divided and controlled by the chairman and
deficit from international tourism in
ranking minority member of the Committee
Adams
Ford, Mích.
1974 was slightly under $3 billion, an
Mollohan
Evans, Ind.
Hinshaw
Rostenkowski
on Interstate and Foreign Commerce, the
improvement over the $3.1 billion deficit
bill shall be read for amendment under the
recorded in 1973. This- momentum to-
So, two-thirds not having voted in fa-
five-minute rule. At the conclusion of the
ward a more favorable net balance of
vor thereof, the veto of the President was
consideration of the bill for amendment,
sustained, and the bill was rejected.
the Committee shall rise and report the btill
payments can, and should, be main-
The Clerk announced the following
to the House with such amendments as may
tained. Experience has shown that it is
pairs:
have been adopted, and the previous ques-
an undertaking that can be successful
tion shall be considered as ordered on the
only through the continued partnership
Mr. Evans of Indiana with Mr. Adams.
bill and amendments thereto to final pass-
of the Federal Government and private
Mr. Ford of Michigan with Mr. Hinshaw.
age without intervening motion except one
industry in promoting the United States
Mr. Rostenkowski with Mr. Mollohan.
motion to recommit.
as an international travel destination.
FORD
GERALD
Remarks by Rep. Charles Rose
U.S. House of Representatives
June 18, 1975
RURAL DEVELOPMENT: BROKEN PROMISES
Mr. Speaker, the Subcommittee on Family Farms and Rural Develop-
ment of the Committee on Agriculture has just finished two exhaustive
days of oversight into the administration of -- and expenditures under
-- the Rural Development Act of 1972.
As Chairman of this Subcommittee, I was astounded and saddened
to learn that the Department of Agriculture has used precious little of
the authority given it under this legislation to improve the quality of life
in rural America.
For the past two days, we have made a section-by-section analysis
of the statute and asked Department officials for detailed responses on
how they have implemented the specific mandates of the Act. Time after
time we were told that some particular authority had not been implemented
because some other agency within USDA or some other department or
agency of the government was providing similar service.
After numerous such responses, I observed that if the officials of
the Rural Development Service had been around two centuries ago when
the Bill of Rights was being considered, they might have said it was a good
idea. But why bother, since we already have the Ten Commandments?
Mr. Speaker, the Rural Development Act -- duly enacted by the Congress
Page two
and signed into law by the President -- says that the Secretary of Agri-
culture "shall assume responsibility for coordinating a nationwide rural
development program. ." The Act further directs him to "utilize to the
maximum extent practicable" each of the offices within his Department
"to enhance rural development."
This has not been done.
Specifically, the assistance to the small cities and towns of this
country envisioned in this law has not been carried out.
Expanded grant and loan programs for water and sewer construction
in rural America have not been implemented.
The mandate of Congress for adequate rural housing through rent
supplements and other programs has been ignored.
Title IV of the Act providing a program of rural community fire
protection has been totally neglected. The President even attempted to
rescind the funds forced on the Department by the Appropriations Com-
mittee. Only after Congress rejected this effort did the money begin
flowing to State forestry officials.
Minimal funding of Title V, which provides research and education
monies, produced some spectacular success stories of dying towns given
new life through self-help motivation. Yet, the Administration does not
recommend that these efforts be continued, but argues instead that the
Agricultural Research Stations or the Extension Service could do the job
as well.
Page three
Hardly a protest was made when the Office of Management and
Budget arbitrarily eliminated "Rural Development" as a functional
category within the Federal Budget -- yet the Secretary is charged
with providing "leadership and coordination within the Executive
Branch" by this law.
It is one thing, Mr. Speaker, to fight the good fight and lose. But
not to fight at all is to betray the hopes and dreams of those millions of
citizens who still have faith in rural America.
The facts presented at these hearings show that every time rural
development comes up for funding, the Administration has consistently
refused to request that funding. In addition, the Administration has shown
a continuing disregard for the intent of the Act by transferring funds,
ignoring mandates of the various titles of the Act and switching funding
sources.
When the Congress passed the Rural Development Act, the directive
to the Department of Agriculture was that this legislation was the vehicle
to channel the tax dollars of rural America back to their communities.
From what we have seen during these hearings, the Department is
laughing in the faces of rural America -- laughter that I and other Members
of the Subcommittee strongly resent.
In the past, as OMB has gone, so have gone the Members of Congress
who were thoroughly intimidated by the awesome power of the Budget
and the arm-twisting tactics of the Executive Branch.
Page four
But now, Mr. Speaker, there is new blood here -- a new Congress,
with a new Agriculture Committee and a new Budget Committee.
I told the Assistant Secretary of Agriculture for Rural Development,
Mr. William W. Erwin, and a dozen of his associates responsible for adminis-
tering this Act, that our Subcommittee was prepared to give them a little
transfusion of courage so that they can fight for full funding for rural
America.
Mr. Speaker, the New York Times this week headlined the results
of new projections by the Census Bureau indicating the rural areas of the
country are growing faster than urban areas.
People are moving out of urban areas at a greater rate than others
are moving in. This trend is without precedent. Since 1790, our young
agrarian nation has moved toward an urban society.
An old farmer in my District had a very profound comment about
all the city folks moving into the rural areas: "Whatever it is they're trying
to get away from, they're bringing it with them."
These problems -- health, housing, pollution of water and air, trans-
portation -- are the problems caused by people. And these are the very
problems the Rural Development Act is designed to confront.
The promise of a better life is still vivid for most of rural America.
The Congress has given the Department of Agriculture the mandate and
authority to make that promise come true. They must act to see that it
does.
###
July 10, 1975
Dear Congressman Archer:
As we discussed, attached is a breakdown of
the Department of Agriculture offices in the
State of Maryland.
Most of these are local county offices, however,
some are large installations in the Baltimore,
Beltsville, and College Park areas.
If I can be of any further assistance, please
feel free to call upon me.
Sincerely,
Thomas G. Loeffler
Special Assistant for
Legislative Affairs
Honorable Bill Archer
House of Representatives
Washington, D. C. 20515
Enclosure
TGL:nd
FORD is LIBRARY
GRANDS STATES DEPARTMENT OF
DEPARTMENT OF AGRICULTURE
OFFICE OF THE SECRETARY
WASHINGTON, D. C. 20250
July 9, 1975
MEMORANDUM TO: Tom Loeffler
Special Assistant for
Congressional Relations
The White House
FROM: John Foltz
Deputy Under Secretary
for Legislative Affairs
getol
Attached is a rundown on the Department's offices in
the State of Maryland. Most of these are local County
offices, but some -- as you can see -- are larger
installations in Baltimore, Beltsville, and College Park.
**Agricultural Stabilization and Conservation Service (ASCS)
Extension Service (ES)
Soil Conservation Service (SCS)
Agricultural Marketing Service (AMS)
Animal and Plant Health Inspection Service (APHIS)
Agricultural Research Service (ARS)
National Agricultural Library (NAL)
Food and Nutrition Service (FNS)
Farmers Home Administration (FmHA)
Statistical Reporting Service (SRS)
Federal Crop Insurance Corporation (FCIC)
Office of Investigation (0I)
FORD
THE
USDA OFFICES IN MARYLAND
ANNAPOLIS
**ASCS, ES, SCS
BALTIMORE
AMS
103 S. Gray Street
APHIS
103 S. Gray Street
Dundalk Marine Terminal
Friendship Airport.
ES
BEL AIR
ASCS, APHIS, ES, SCS
BELTSVILLE
APHIS
5026 Herzel Place
ARS
Agricultural Research Center
SCS
Plant Material Center
NAL
CAMBRIDGE
ASCS, ES
CENTREVILLE
ASCS, FNS, ES, SCS
CHESTERTOWN
ASCS, ES, FmHA, SCS
COCKEYSVILLE
ASCS, ES, SCS
COLLEGE PARK
APHIS
ASCS
State Office
4321 Hartwick Road
SCS
State Office
4321 Hartwick Road
SRS
University of Maryland
Symons Hall
2
CUMBERLAND
ASCS, ES, FmHA, FNS, SCS
DENTON
ASCS, ES, FmHA, SCS
EASTON
AMS, ASCS, ES, FmHA, SCS
ELKTON
ASCS, ES, SCS
ELLICOTT CITY
ASCS, ES, SCS
FREDERICK
ASCS, ES, FmHA, FNS, SCS
GAITHERSBURG
ASCS, ES, SCS
GLENN DALE
ARS
Plant Introduction Station
HAGERSTOWN
ASCS, ES, FmHA, FNS, SCS
HANCOCK
APHIS
HUGHESVILLE
FCIC
HYATTSVILLE
OI, APHIS
LA PLATA
FNS, ES, FmHA, SCS
LEONARDTOWN
ASCS, ES, FmHA
NORTH EAST
FmHA
OAKLAND
ASCS, ES, FmHA, SCS
PRINCE FREDERICK
ASCS, ES, FmHA, SCS
PRINCE ANNE
ASCS, ES, SCS
3
ROCKVILLE
ASCS, ES, SCS
SALISBURY
APHIS, ASCS, ES, FmHA, FNS, SCS, SRS
SNOW HILL
ASCS, ES, FmHA, SCS
UPPER MARLBORO
ASCS, ES, SCS
WALDORF
ASCS
WEST FRIENDSHIP
AMS
WESTMINSTER
ASCS, ES, FmHA, SCS
WHITE PLAINS
ES
Total Number USDA offices in Maryland - 114
RED TAG
FILE
THE WHITE HOUSE
WASHINGTON
July 15, 1975
MEMORANDUM FOR:
MAK FRIEDERSDORF
THRU:
VERN LOEN VC
FROM:
CHARLES LEPPERT, JR. czg.
SUBJECT:
Rep. Wayne Hays (D-Ohio)
Attached is the copy of the letter you requested that I pick up from Rep. Wayne
Hays' office.
CL - one already have
this . - I am tracking
wy asDA
VL
FORD & LIBRARY 038470
June 25, 1975
Mr. Hays:
Maynard Buck applied for a $1.8 million
economic development loan from the Farmers Home
Administration. The purpose of the loan was to
purchase Carrollton Graphics, a company which is
failing at present but which he believes has sub-
stantial potential.
Mr. Buck invested 10% of the amount ($180,000).
The Farmers Home offered to guarantee 90%. The bank
offered to put up the remainder but asked Mr. Buck to
make a personal guarantee for the amount carried by
the bank. Mr. Buck felt that his investment was sub-
stantial and, therefore, he should not be obliged
to make the kind of guarantee which would risk his
home and personal property. The bank accepted the
loan on this basis and the Farmers Home office in
Columbus forwarded the application to Washington.
The Washington office of the Farmers Home
indicated that the loan looks sound based on their
evaluation of the company's chances and Buck's
experience and demonstrated business competence.
The only problem which might arise would be that
Buck was not making a personal guarantee commensurate
with the guarantee being provided by the Farmers
Home. I advised that we believe this to be an
important project for the development of the area,
that it would continue many jobs that will undoubtedly
be lost otherwise and that you also have great faith
in Mr. Buck's business acumen.
PAA
FORD i LIBRARY GERALD
RED TAG
oF
THE WHITE HOUSE
WASHINGTON
August 18, 1975
MEMORANDUM FOR:
VERN LOEN
FROM:
CHARLES LEPPERT, JR.
SUBJECT:
Rep. Tom Hagedorn (R-Minn.)
Hagedorn called last week on the grain situation and the dispute over whether
the longshoremen would load the grain. States that the grain sale and federal
control of farm exports is a serious issue in Minnesota.
Doesn't like the idea that the longshoremen can affect international trade policy
by refusing to load grain on ships and such actions affect the domestic market
price of grain. Minnesota has experienced a severe draught cutting the wheat
crop in half and the people feel the government is working against them by
contracting the foreign markets. There is no reason to ban the sale of wheat
or soybeans. There may be reason to hold down corn sales to protect domes-
tic livestock but not the others.
Says the President and Butz are going back on what they said when they vetoed
the farm bill if they now want to again control agricultural exports. Feels
the President should make a statement in Minnesota to the affect that "he will
not permit one segment of our society (the longshoremen) to dictate our inter-
national trade policy.
Vern, do you think you should call Paul Theis on this in Vail to get something
like this in the President's speech in Iowa or Minnesota?
cc: Max Friedersdorf
&
FORD
GERALD
817
(not read after being typed)
THE WHITE HOUSE
WASHINGTON
July 16, 1975
MEMORANDUM FOR:
MAX FRIEDERSDORF
THROUGH:
VERN LOEN UL
FROM:
TOM LOEFFLER
SUBJECT:
Conversation with Congressman
Joe Waggonner (D. -La.)
On several occasions Congressman Waggonner has expressed
his sincere concern over the prospective sale of grain to the
Soviet Union. It is his opinion that because the last grain sale
was poorly handled, the Administration and specifically the
Department of Agriculture should make all facts known about
the sale before it is finally consummated.
During House consideration of the Agriculture Appropriations
Bill on July 14, the House rejected by voice vote an amendment
that sought to prohibit funds to provide credit or other subsidies
for purchases of United States agricultural commodities by the
Soviet Union without prior congressional approval. Congressman
Waggonner feels that this amendment, as well as the editorial
such as appeared in the Washington Post on July 15 (attached),
serve as a prelude to future criticism which may be levied against
President Ford should such sales not be handled in a responsible,
open and forthright manner. I believe that the congressman's
concern merits strong consideration.
Attachment
FORD i LIBRARY
Some items in this folder were not digitized because it contains copyrighted
materials. Please contact the Gerald R. Ford Presidential Library for access to
these materials.
TUESDAY, J
The Washington Post
AN INDEPENDENT NEWSPAPER
The Next Russian Wheat Deal
0
NCE AGAIN the Russians are apparently preparing
If he is wrong, grain prices will go up substantially.
to- buy large quantities of American grain. Once
As the past several years have shown, the direct effects
again the U.S. government says it has no precise informa-
on the consumer are not the important ones. Even a
tion on the Russians' intentions. Once again the Depart-
heavy increase in the price of wheat has only a modest
ment of Argiculture seems to have become aware of
effect on the cost of a loaf of bread, since there is only a.
the prospective sale mainly through accidental and in-
few cents' worth of wheat in a loaf that sells for half