Dr. CLARKSON. There are no fees required. There is one cost that must be paid directly if overtime operations are involved. Whatever expense the Government has in terms of overtime payment to its inspectors must then be reimbursed to the Department by the establishment that operates out of the set hours. That is the ony thing that might be called in the nature of fees.

Mr. HAGEN. What is the overtime rate for the Federal inspectors? Dr. MILLER. $4.04 an hour. That is according to the grade of inspectors, however.

Mr. HAGEN. Dr. Boyd, what is the overtime rate in California? Dr. BOYD. We run from $4 and something an hour. I do not have it in pennies.

Mr. POAGE. Is there anything further?

Mr. JARVIS. I would like to add this. It is very obvious, if these many State houses believed that they can benefit from this Federal inspection and have the free movement of merchandise, many of them would have applied by this time. So, in closing, I would like to ask this committee to consider this

Mr. HAGEN. What do you mean by that statement—would you repeat that?

Mr. POAGE. Go ahead and repeat it.

Mr. JARVIS. My statement was that if many of these State houses now operating could have seen it economically sound to make a Federal change they would have done so.

Thank you.

Mr. POAGE. Thank you. I understand that Mr. Fuller wants to make a statement.

It is necessary for me to leave at this time, and I am going to ask Mr. Breeding to take the chair.

Mr. BREEDING (presiding). We will be glad to hear from you now, Mr. Fuller.

STATEMENT OF GEORGE M. FULLER, WASHINGTON REPRESENTATIVE, COMMITTEE FOR EQUITY IN MEAT INSPECTION

Mr. FULLER. Mr. Chairman and members of the committee, I want to bring out this point, first of all, the gentlemen representing the Federal Government employees could not get witnesses here. I would like to put in the record the fact that our three witnesses came from California and they all arrived here in time. We were notified the same as everybody else as to the time of the hearing.

We have been kicking around with this bill for a long time. We would like to have early action at this time. Any further delays, of course, we believe is unnecessary. I hope that early action will be had by the committee, and favorable.

Mr. BREEDING. If you have any further remarks that you should like to present for the record, they will be included in the record. Mr. FULLER. I would like to summarize some of the things that have been said before.

First of all, this bill was drafted in the Department of Agriculture. They understood our problem. We laid our problem before them.

In view of that we went to the Department of Agriculture, and their people drafted this bill and with consent, of course, of Mr.

Hagen and others. I am trying to bring out the point that we wanted as well what they wanted, to safeguard themselves.

We do not see in this bill any of the pitfalls that the people from labor seem to think exists.

A year ago in March, I believe, the Department of Agriculture gave us a complete clean bill of health from this legislation as it was formerly written, not as favorable to the Department of Agriculture then as it is now, but they gave us a complete clean bill of health. In the interim the Chicken and Poultry Act, an inspection act, had become the law of the land.

They found that in the inspection of chickens and poultry, the States wanted to pass cost across all of this service which formerly the States used to assume back to the Federal Government. They, also, found that this was a new type of industry for the Federal inspection, and they had quite a bit of a problem in administrating it. So, apparently, that was the reason that they decided then in a subsequent report last year that they reversed themselves completely and did not want this type of legislation.

I think that history ought to be known and in the record. The report that was issued on February 18 was a rather interesting report, because it is sort of a contradiction in itself. In the second paragraph they say that it would have the potential of increasing Federal expenditures for meat inspection service.

I read that, of course, to mean to me that more additional people would be required to supervise the several States.

Then in the next paragraph they state that H.R. 8951 would enable the Secretary of Agriculture to use State meat inspectors in the Department's meat inspection programs.

So they tell us again that enacting this type of legislation would definitely reduce or hold down the expansion of costs now going on in carrying out this inspection.

Congressman Horan had to go back to his State, as you know, but he was going to give a report today on the cost. The cost in this meat inspection has been going up the last 3 years at a very alarming rate. So he had something to say, because he is on the Subcommittee of Agricultural Appropriations, handling that appropriation.

I think we should, also, realize that this bill-I am coming back to some points that were brought up here today-is not a mandatory piece of legislation. It is a voluntary thing. It is completely wide open, so far as the Department of Agriculture is concerned. They wanted it written that way. They wanted to be able to come in and designate this house as being OK, State inspected, paid by the State of California, that that house with its facilities and everything else was OK.

And they could come in and designate that house-not this onebut that one. So it is wide open.

I realize that within the Department there is a little bit of controversy over the fact that some of the people might want it complete statewide, in other words, what I am saying is that they would say to Dr. Boyd, "Your 366 houses may be permitted to issue these several stamps."

Mr. HAGEN. May I interrupt there? My understanding is that these people are not seeking the right to use the Federal stamp.

Mr. FULLER. Yes, they could use it.

Mr. HAGEN. They want the privilege of selling in interstate commerce, to Federal agencies, and abroad.

Mr. FULLER. This does not, this bill, bring that point out. It is wide open in that regard. It is wide open.

Mr. HAGEN. I see no reason to give them the Federal stamp, but I do see a reason to give them the right to sell in interstate commerce, through State inspection.

Mr. FULLER. That is right. That is completely their latitude. This bill leaves that wide open to them. There is nothing in here, in any way, that forces the Federal Government to carry on with this act.

In fact, after this legislation is passed if they see fit not to license any State or any house in any State, that is their prerogative. I do not know why there is any reason for anybody to read into this more than they wanted to put into it themselves.

The 366 houses in California do not represent all of the slaughterhouses and all of the packing houses in California.

There are many rules that we have in California, such as that a town with less than 28,000 people cannot have State inspection. That would be covered by this inspection, and those sorts of things.

The figure was given a bit ago that 20 percent of all of the meat consumed in America was from State houses, or otherwise inspectednot Federal. The inference was that 80 percent was federally inspected. That is not correct.

Actually, the answer is that 70 percent is federally inspected, 20 percent is by the State, and 10 percent is what the chairman thought about a bit ago slaughtering cows under a mesquite bush. That is for home consumption. There is, approximately, 10 percent that is in that category.

Mr. HAGEN. It was not the intent to give the Federal stamp, but to remove the disability of a presently restricted category of sales.

Mr. FULLER. There is another point which has not been brought out here which I think should be made clear. There are 366 houses in the State of California that would apply immediately for Federal inspection. I do not know of anyone that would not, if they could get Federal inspection for intrastate who sell to the military installations. That is very important.

We have been kicking this interstate commerce part around quite a bit. Interstate is one thing; but for you to sell to any Federal institution, you have to have a Federal inspection. And the Federal inspection is not available to you for that purpose alone. Do I make that point clear?

Mr. HAGEN. That contradicts the testimony, I believe, of Dr. Miller.

Mr. FULLER. That is why I thought I would clarify that point. Mr. HAGEN. The statement was made that mere intent to sell to a Federal agency was sufficient to qualify under the interstate aspect of it; is that not correct?

Mr. FULLER. That is not the experience of Dr. Boyd and his people. Mr. HAGEN. Would you comment on that?

Dr. BOYD. We have many plants in California that have been denied the privilege of selling to Army installations. As a matter of fact, we were back here several years ago trying to get the Army to

recognize the inspection. These plants cannot sell to the Army. They cannot get Federal inspection on the basis of that.

Mr. HAGEN. You know that they cannot as a matter of policy, but not as a matter of statute.

Do you say further that in practices mere stated intent to sell has not been regarded as sufficient evidence of a proposed interstate business?

Dr. BOYD. I am not administering the Federal meat inspection, but I have been told by our people that they could not get Federal inspection just because they wanted to sell to the many Federal agencies in California. As you know, there are a great many of them

there.

There is one other point that I want to bring out, if I may-that is, that California is a meat-importing State. We practically import 90 percent of all of the pork production. We import our beef production and a great deal of our lamb, even though we are a large sheep State.

This idea of qualifying to interstate movement is more or less out of the picture in California.

It was only a few years ago that there were only seven Federal plants in California that moved any meat out of the State at all. The old Federal requirement was that they had to do 25 percent interstate business. Now I do not know what the Federal standard is for granting Fededal inspection. I know of places that want to sell Federal installations that cannot get Federal inspection, unless they engage in interstate business.

Mr. HAGEN. That seems to contradict the testimony of the Department of Agriculture witnesses. They testified that there were instances where Federal inspection would be granted even without a started intent to move meat interstate.

Dr. MILLER. Apparently, communication has broken down here. Actually, what we said earlier was that selling to the Federal agency is the kind of evidence of interstate business that justifies an inspection for a packer, assuming that he meets the requirements.

As a practical matter, there is no buying restriction. As a practical matter, it is like chasing a jack rabbit.

It is probable, as Dr. Boyd has stated, as he characterized the old meet inspection organization, that it had some kind of percentage requirement, but that has droped by the wayside long since and it is completely impractical.

Mr. HAGEN. I did not mean to interrupt you.

Dr. BOYD. As I understand, we have no special standards, so far as interstate business is concerned. Mr. Poage was bringing out the point that if we sold a little meat to one customer, or if he did, then he could get Federal inspection. Our people do not think so.

In fact as a matter of fact, people who want to sell to the national park, a Federal installation, like the Sonora plant, have not been able to get Federal inspection on the basis that they want to sell Federal agecnies.

Dr. MILLER. To the extent that any specification incident seems to contradict what I said I would like to have an opportunity to look into it, because I have expressed our established policy. Whether there are some other factors entering into the Sonora plant application, it

would be interesting to determine. I am not personally familiar with that application.

Dr. BoYD. Another point is that they denied Federal inspection because they cannot supply the inspection-they cannot supply this little fellow with inspection. In other words, we have no quarrel with the fact that all of our plants go into Federal inspection, but they cannot supply the inspection to do the job.

For instance, in the Sonora case, the plant operates only a day or two a week, and they could not give inspection—that is, the Federal Government.

Mr. FULLER. I thought that I would answer Mr. Heimburger's question a little more precisely. His question was—if I am a State house and I am a producer of Prime beef, I cannot sell to the Federal house. He cannot take my meat, because it came from a slaughterer who was State licensed. That is the answer to your question.

When you get into this business of people like Mr. Jarvis, he may have 90 percent of his processed meat going into intrastate business, but every now and then, if he wants to sell the Safeway Stores or some large chainstore organization, there is just the possibility that one small package of that—or one case of it will get into Yuma, Ariz., or over into Phoenix, Ariz., or Las Vegas. And if it does, he is in for a lot of trouble.

As Dr. Boyd said, the movement is normally into the State of California and not out of it-so that there is not, normally, the demand for that. However, he has to be very careful.

He cannot operate and sell to that kind of trade, because he will have a $500-up to $30,000-fine if his product moves into interstate commerce by error. There is only one thing for him to do. He is ruled out.

That is complete discrimination, in my book. The thing for him to do is to freeze his own source of supply, to take care of that 1 pound of beef that might go in.

As I said earlier, this legislation is implementing the old 1906 act, really. That is what it is doing. There was an attempt to change it in 1948. It was changed back, and that was primarily for appropriations reasons.

It will continue top inspection of meat. And we say that in the State of California the grade of that inspection will depend entirely upon the U.S. Department of Agriculture. They are the ones who write the ticket.

No one can look at this bill and imagine that you are going to have a lowering of the standards of meat; I do not believe that it will do so. The sole administrator of this act, this piece of legislation, is Dr. Clarkson and Dr. Miller and their staff. They will see to it and do a far more thorough job than that which is being done in Argentina or Australia or any other foreign country.

That State house knows that they are being supervised, and if the supervisor finds something wrong he will lose his license right away. I think it will be even faster than now, because of the close personal contact between the State level and the Federal.

Mr. BREEDING. Are there any further questions?