Senator LEAHY. Thank you. I appreciate your referring to some of my earlier questions, Mr. Jones. Your whole statement will be in the record, and the committee and staff will certainly consider the changes you suggested. We appreciate them.

Mr. JONES. Thank you.

[The prepared statement of Mr. Jones follows:]

STATEMENT OF B. H. "BILL" JONES, EXECUTIVE VICE PRESIDENT, NATIONAL LIVESTOCK FEEDERS ASSOCIATION, OMAHA, NEBR.

The National Livestock Feeders Association supports the concept embodied in S. 772 of establishing a national cattle check-off for the purpose of financing a coordinated program of research, education, promotion, product and market development, consumer information, and the like involving cattle, beef, and beef products. The Association does recommend a few "clean-up" amendments in the proposed bill to clarify the intent of the language.

Before proceeding with the recommended changes in language, let me touch on two other matters which it seems appropriate to emphasize to the Committee. Control of Program Activities and Funds

As this program is structured in the proposed legislation, the monies will be collected solely from cattle producers and feeders. In other words, no one else's money, including that of the Federal Government, will be "in the pot", so to speak.

Therefore, cattle producers and feeders should have exclusive control over program activities and the expenditure of said funds, except for that degree of control which is necessary for the Secretary of Agriculture to assure the funds are spent in accordance with Congressional intent.

The cattlemen, of course, will welcome and use the expertise of qualified persons in related industries, in the consumer field, and in government in an advisory capacity. The point we wish to emphasize, however, is that they should not be forced, by statutory dictate, to give up any degree of control.

Collection Enforcement at Other Than Point of Slaughter

We anticipate that USDA officials may look upon the matter of collection enforcement at points other than slaughter with certain qualms, in view of the number of persons and transactions involved.

This leads me to stress to the Committee and for the record that collection for imbursement to the Beef Board, under the value-added concept, will take place at the point of slaughter only. This means that "collection" at the other sales levels will be a matter between buyer and seller, and therefore, will be selfpolicing, or we might say, buyer-policed.

The need for formal collection enforcement will be focused at the point of 'slaughter only and should be viewed in that context.

RECOMMENDED CHANGES IN BILL

Consistency of Terminology

In much of the proposed bill, the focus of the language is on "beef", standing alone; whereas, the intent is clearly for program activities to cover cattle and beef products, as well as beef per se.

Therefore, we recommend the terms "cattle, beef, and beef products" be used consistently throughout the bill to clarify the language and to avoid the implication that program activities should in any way be restricted to beef, as the term is defined in the definition section.

Specific reference is made to the following places in the bill:

(1) title of the bill

(2) page 2, lines 4, 11, 12 and 13

(3) page 5, line 2

Also, there are certain instances where the term "cattle" should be substituted for the term "beef". They are as follows:

(1) page 3, line 15

(2) page 10, line 17

(3) page 11, line 9

Definition of "Beef Products"

As the definition now stands (page 4, lines 9 and 10), it would include milk and other dairy products. Since this is not the intent, the words "exclusive of milk and the products made therefrom" should be added.

Addition and/or Substitution of Words

On page 10, line 12, insert the words "within the given geographical area" immediately following the word "cooperatives". It is important to clarify that only those groups within a given geographical area (state or group of states) are to be involved in selecting the nominees to represent that given area.

On page 12, line 4, the words "collect and" should be inserted immediately following the word “shall”. The handler is to collect only one-half the applicable rate during the first six months, as well as making payment accordingly to the Beef Board.

On page 12, line 5, the word "action" should be changed to "sales".

Secretary's Authority to Conduct Referendums

On page 14, line 16, the bill states the Secretary may conduct a referendum at any time. The NLFA does not agree with giving the Secretary such blanket authority, and urges this language be stricken.

The Association does agree with the concept of providing a practical avenue for cattlemen to terminate or suspend an order, as provided in the language immediately following the previous reference.

Certification of Organizations

Sec. 15, pages 17-19-The NLFA views it as being imperative that "the tail not wag the dog" with respect to the organizations involved in the selection of Beef Board nominees. To avoid this pitfall, the organizations certified to participate in such selection should be those whose members will make a substantial financial contribution to the program.

We recommend the following addition to the proviso on pages 18 and 19, lines 24 through 3, to further assure the exclusion of organizations which do not meet this criterion (addition in italics) :

Provided, that the primary consideration in determining the eligibility of an organization shall be whether its cattle producer membership consists of a substantial volume of cattle destined for slaughter and meat production and, thereby, said membership can be expected to make a substantial financial contribution to the program.

Senator LEAHY. Mr. Cunningham.

Mr. Cunningham is the president of the Independent Cattlemen's Association of Texas. He is from Goliad, Tex.

STATEMENT OF T. A. CUNNINGHAM, PRESIDENT, INDEPENDENT CATTLEMEN'S ASSOCIATION OF TEXAS, GOLIAD, TEX.

Mr. CUNNINGHAM. Our organization is rather a new organization, organized in 1974, and we already have a membership making it one of the largest nonaffiliated livestock associations both in Texas and the United States.

First of all, let me commend the authors of the Beef Research and Consumer Act as the concept encompassed within this bill is supported by the association. It is very interesting to compare the bill's legislative findings and declaration of policy to those purposes for which our association was organized. Our purposes include the following:

To aid in improving and promoting the marketing of livestock in every practical manner and by all practical means;

To engage in all activities necessary, useful, or expedient for the improving and promotion of the marketing of livestock, including but not limited to:

(1) Developing standards for the sale of livestock calculated to provide the producer a fair return on money, time, and energies invested.

(2) Cooperating with other organizations concerned with the livestock industry and all other phases of agriculture and any other groups or associations which activities affect the price paid for livestock in the marketplace in such a way to encourage and foster the promotion of livestock marketing to its fullest measure.

(3) Fostering the publication of information which will aid in the development and stimulation of innovative marketing techniques and better understanding between the producer and consumer for the general welfare of the public.

(4) Encouraging a system of education and training in livestock production and marketing calculated to assist the producer.

(5) Supporting a system of production and marketing which will at all times assure the availability of domestic livestock to the con

sumer.

(6) Developing, maintaining, and enforcing marketing and labeling standards which will assure to the public the highest quality of meats for human consumption.

(7) Cooperating to the fullest in conducting research, examinations, investigations, experiments, and in the dissemination of information in livestock marketing with the branches, agencies, and departments of government in the United States.

To provide a means of participation for each livestock producer, irrespective of the amount of livestock produced or number of acres owned or operated, so that each person will have the opportunity to express opinions and ideas for developing better marketing techniques.

Each of you is well aware of the tremendous difficulties facing the agricultural and livestock industry at this time. We must reverse the trend which has seen cattle prices fluctuate from all-time highs to all-time lows in very short periods of time. This bill, as we understand it, is an effort to bring about stability in the marketplace, better education of the producer, and a better product for the consumer. Its purposes are well intentioned; however, I must call your attention to several aspects of the bill which we feel require substantial modification in order to accomplish the purposes of the bill, and allow our association to support the bill.

(1) The Beef Board and not the Secretary should be given greater authority in the promulgation of an order under the act.

To be quite candid, many procedures, and in fact many of the consuming public, have lost confidence in the actions of the USDA. This bill, as written, gives virtually all authority under the act to the Secretary of Agriculture. A better system of checks and balances between the Beef Board and the Secretary allowing the Board to propose orders and then, following the other procedures set out in the act, should be developed. The Beef Board to be effective must propose orders. A good example of possible abuse of discretion by the Secretary is the provision that books and records as may be required by any order issued pursuant to the act. This provision causes concern to the producer because of further erosion of personal rights and the right of privacy, particularly if such standards were developed by

the Secretary as opposed to being developed by the Beef Board comprised of individuals who work each day with the people involved. (2) Appointment authority for members of the Beef Board should be vested in the Secretary of Agriculture of each State, or, if no Secretary of Agriculture, then the Governor of the State, and where a given State is not entitled to one member based on the percentage of cattle produced, a system providing for caucus of those States in a geographical region should be developed to provide for representation on a rotating basis.

By allowing the Secretary of Agriculture of the various States to make appointments to the Beef Board, greater grassroot involvement in the various States can be obtained. In addition, the members of the Beef Board selected this way would have closer contact with current problems and activities in their respective State.

(3) The assessment should be established by the Beef Board within specified statutory guidelines and not left to the discretion of the Secretary to determine what is reasonable or adequate.

We would ask that the Congress reassert its position, not only with this legislation but in all legislation where authority is delegated to an administrative agency. Standards should be established by the Congress which can be adhered to by the agency and not left openended for agency discretion, which actions often clearly violate congressional intent. I might add that this single issue is of greatest current concern to the thousands of people that I have had the opportunity to visit with in recent months. I appreciate the tremendous responsibilities of your position and recognize the time constraints under which you operate, but I assure you that if the Congress will not delegate its authority to the agencies but continue to reassert itself as it did several times during the latter part of 1974, the public's impression of and respect for the Congress will continue to be enhanced.

(4) The Secretary of Agriculture of the various States should be involved in the certification of eligible organizations as opposed to the provision whereby the Secretary's determination as to eligibility is final.

We feel that the recognition of organizations that are eligible must be made by more than one person. The Secretary of Agriculture of the various States or the Governor in our opinion would be in a better position to know of the applying organization's ability to further the aims and objectives of the act.

(5) Before enactment of this legislation, a projection of how much money is intended to be raised, and how it is to be spent, should be developed.

As a businessman, I cannot help but ponder what would happen at a financial institution if I sought to borrow money based upon an application with fiscal projections no greater than are included in this bill. There is no question but that the loan application would be denied. It is essential that projections be developed advising the producer and the consumer of the amount of money to be raised and how it will be spent.

Mr. Chairman and members of the committee, there are other sections of the bill, including the authority of the Secretary to bring suit and the penalties section which require change, but the areas

which I have discussed are those of major concern to both the producer and the consumer.

I would respectfully request the opportunity to work with the committee staff in developing amendments to the act, which would incorporate the above recommendations. I appreciate very much your time and attention, and our association is hopeful that the necessary amendments can be adopted so that we can support its passage.

Senator LEAHY. Mr. Cunningham, I appreciate your extensive and well thought-out statement. Did you have anything you might want to add to any of the questions or the answers that you have heard here today?

Mr. CUNNINGHAM. Yes, sir. We feel that the refund or rebate would cause quite a hardship. I represent the cow-calf producers, the country boy, and 95 percent or 98 percent wouldn't know where to apply to begin with. And we have things going on in the State, brucellosis programs that are supposed to pay-some of them made applications 6 months ago, and still haven't got the money back. These people are poor people. They work hard, and they need the money bad.

As far as education, we are with that all the way. Of course, we have emergency things for right now, and education is the least thing we need. We need a better price for cattle. Of course, we feel that a check-off would be wonderful if we could just get it worked out to where it would work with everybody. We want a check-off, but we want a right one. We waited a long time for it, and we feel that this one could be right, if there were some work done on it.

Senator LEAHY. You feel there has to be some work done.

Mr. CUNNINGHAM. There definitely has to be. I have applied for many loans in my life, and I am a businessman as well as a rancher, and I do know what financial institutions want in a projection, so you had better have it much better projected. We feel like it has got to be in there. We do not want any agency to dictate to us, we want to run our own business, and we want the Beef Board selected from the people who run that business.

As far as its costing the consumer money, the consumer is our customer, and we are consumer producers. We have even had our fuel costs backed up to us in a recent couple of years. All costs have been backed up to us. We think this is strictly a check-off paid by us, and an expense paid by us, and if we had a check-off that we could live with, we would love to have it.

Senator LEAHY. Thank you very much.

Mr. CUNNINGHAM. Thank you.

Senator LEAHY. Mr. Glenn Lake. Mr. Lake is president of the National Milk Producers Federation, and I note by your testimony, Mr. Lake, that your organization is in support of S. 772.

STATEMENT OF GLENN LAKE, PRESIDENT, NATIONAL MILK PRODUCERS FEDERATION, NORTH BRANCH, MICH.

Mr. LAKE. That is true, Senator. We do support the basic principles of this.

I would just say that we do support the kind of legislation embodied in S. 772, which provides a legal framework for livestock