away from the direct distribution of food and getting to the point where cash was going to be used. To get ourselves out of the national delicatessen store business; and, also, not use the Federal Government as a mechanism to just buy up whatever the farmers happen to have left over—whether it is lard one year, or whatever it may be.

Maybe the Chair would like to clarify that for me. I almost inferred it may be a change in his own thinking and a change in the committee's thinking.

Senator Mcgovern. Let me say to the Senator, first of all, with regard to the bipartisan character of this committee—we haven't lost that at all. Usually that bipartisan character has manifested itself in both Republicans and Democrats on the committee doing battle with the administration on trying to strengthen these programs.

Senator Percy. Whichever administration it is.

Senator Mcgovern. That is correct. This committee began under a Democratic administration. We frequently had to battle them on the School Lunch Program—as well as other programs—as the Senator from Illinois and we have continued that battle without partisan considerations with the present administration.

Some of the things that Mr. Hekman was able to point to with pride in the program are things we had to put through over the opposition of the administration a few months ago, as I am sure he remembers.

Need Foolproof Cash Reimbursement Safeguards

But with regard to this particular point, there are two things I want to say. If I can be absolutely convinced that some arrangement is worked out on a cash reimbursement that is foolproof—that is going to be dependable in safeguarding this program—I am willing to listen to that case. I haven't seen it yet. I haven't been assured, to my own satisfaction, that we have a dependable and viable substitute for the commodity program. My own fear is that if we let this program go without more assurance than we have seen so far, we are going to rue the day. It is going to be a regrettable day for the schoolchildren of America.

Now, with regard to the point the Senator has raised in my statement here about the surplus program. I recognize that depending on surpluses alone has never been enough to maintain an adequate, wellrounded diet in the School Lunch Program. I simply say that no one in this room has the vision to say that we won't have surpluses again in this country. And one of the thrusts that we have always had behind strong food assistance programs in the United States is that we have had this surplus capability.

I don't want us to give that up. I don't want us to lose that capability to produce more at various times in this country than we need at any given moment. That is all I am saying. Let's maintain both mechanisms. Let's maintain the capacity to utilize these surpluses efficiently. Use them in constructive ways; and, at the same time, let's recognize that we have a further obligation of providing additional supplements in the form of cash and other commodities—whether they are in surplus or whether they are not.

Senator Percy. I think we probably do have a difference, then. I would say if we have a surplus, let the pricing mechanism in the market dispose of it.

Senator Mcgovern. Well, you are disposing of the farmers.

Senator Percy. It may be surplus cotton one day, it may be surplus something else another day. I just hate to see the Federal Government get into the business of saying whatever the farmer produces—other than a minimum, the things that we need for, say, national security, probably ought to be strategic stockpiles of something, but not to just take up as we have in the past and buy up and hold over the heads of the farmers these depressants in the matter of surpluses.

I would rather we orient this program toward exactly what the children need, what the individuals need, and see that we use our purchasing power to get it. I don't imagine, here, we thoroughly agree with each other. There is no better investment that we can make than in nutrition. Nutrition education, nutrition in the way of foodstuffs to provide the strength that those young bodies need in the development of their minds and bodies in the future is the best investment we can make.

It is peanuts in a sense. Maybe it is 50 cents out of a dollar compared to what we have been willing—for 40 years now—to pay to the farmers for producing and holding a product out of the market.

I think, with some courage, we can now say we are going to be in a food scarcity position for a number of years to come. When a program is over and its time has come, let's bite the bullet and end it. I think in this regard I am with the administration.

In a couple of other areas, I am not, but in this case, I am.

Senator Mcgovern. Thank you very much, Mr. Hekman, and you other gentlemen from the Department. We may have some additional questions to submit in writing to you. We do have several other witnesses to be heard, and we are going to have to move on.

Mr. Herman. Thank you very much, Mr. Chairman.

Senator Mcgovern. I would like to call Dr. Perryman and Mr. Carpenter to the witness stand together.

Dr. Perryman is the executive director of the American School Food Service Association, and Mr. Carpenter is the chief of the School Food Service Section of the Iowa Department of Public Instruction.

We will begin, I think, with Mr. Carpenter's statement, and then, Dr. Perryman, we will let you be the concluding witness on this panel before we move on to the two witnesses from my State.

STATEMENT OF VERN CARPENTER, CHIEF, SCHOOL FOOD SERVICE SECTION, IOWA DEPARTMENT OF PUBLIC INSTRUCTION

Mr. Carpenter. Thank you, Mr. Chairman.

With your permission, I will summarize my testimony and ask that my written statement be put in the record.1

For the record, my name is Vern Carpenter, and I am State director of the Food Service Programs in Iowa. I am here today, not only on behalf of the Nation's schoolchildren, but also on behalf of Head Start children, day care center children, children being fed in settlement houses, churches, summer camps, and in other service institutions. Also, children of migrant workers, senior citizens, and persons fed in disaster feeding programs.

i See p. 975.

r

I also represent the American School Food Service Association and its 60,000 members comprised of school food service personnel, State school lunch directors, nutritionists and dietitians.

When word began to get around that schools and other recipient agencies might not receive Government commodities after July 1, 1975, our association became concerned. Government commodities have been the backbone of our child nutrition program since 1946.

Mr. Chairman, I wish to thank the committee for the opportunity to testify at this hearing today.

Operation Depends On Donated Commodities

We appreciate the support the committee has given child nutrition programs during past years, as well as the present efforts of the committee.

The problem we are addressing today affects many infants, children, and senior citizens. In past years, many persons have benefited through disaster feeding. Our Nation's schools and service institutions participating in child nutrition programs cannot very well operate without Government donated commodities. They cannot financially stand the potential loss of from 5.5 to 7 cents per meal if commodites or cash in lieu of a shortfall are not forthcoming after this coming fiscal year—1975.

Farm supluses come and go. Even with the new farm bill enacted last year providing for target prices, the wisdom of the Congress in enacting Section 4(a) of Public Law 93-86 which permitted the Secretary of Agriculture to purchase commodities under Sections 32 and 416 without regard to surplus or price support has been demonstrated during this school year.

The wisdom in enacting this special authority can be illustrated with an example. During the month of December, Iowa's beef producers stated they stood to lose around $200 a head on each beef animal because of a drop in prices.

Quite naturally, as you and I might do, they went to Washington, D.C. to ask assistance from the Congress. One USDA recommendation was that beef might be purchased for the School Lunch Program.

Incidentally, that was one of the recommendations that I was waiting to hear. I was very pleased when the USDA made that recommendation.

During the past school year, 1972-73, our schools received no beef as a Government commodity. During this year we have received some, and we are told that we will receive a second shipment before school is out this year.

Now, this seems logical to me, at least. What better time for the USDA to step in and buy ground beef for schools, and what better use for beef than to feed it to hungry children?

The purchase of beef this year would probably not have been possible without the special authority contained in Public Law 93-86. This authority expires June 30, as you previously stated, and we thank you, Mr. Chairman, and others, for introducing the proposed legislation to make this special authority of a permanent nature.

During the past year, I am told by the USDA that the USDA purchased $32.5 million worth of commodities from Iowa out of this $311 million that they purchased.

This helps Iowa's economy.

Now, Iowa is a farm State—with which you are all well aware— and as Iowa's farm economy goes, so goes the rest of Iowa's economy. It is about that simple. Business, schools, and the legislature. The amount of commodities that we will receive this school year will be an estimated $7 million worth. This figure of $7 million, at this time, is more than all of last school year.

So my point is that it is necessary to farm economy, and also this school year. We are not in a bad commodity year, the way that we refer to it.

Another serious threat, in our opinion, is the possible disbandment of within-State commodity distribution systems. One of the problems of surplus is that surpluses are never where they are needed. If there are to be no Government commodities after next school year, the States may have to disband our commodity distribution systems.

If all States had disbanded their distribution systems last fall, the purchase of commodities this year would have been futile. There simply would have been no way to distribute the commodities. We States need to know by April 1 of next year, 1975, what action we should take regarding our commodity distribution sj^stems. If they are to be disbanded, personnel must be released or transferred. We would cancel our contracts with privately-owned warehouses. It doesn't seem fair to dedicated and faithful employees to leave them in the dark about whether or not they are going to have a job after a certain date.

And, of course, schools and service institutions will need to know so that they can plan their budgets and make any other necessary arrangements.

Cannot Operate On Promises

Now, this offer of cash instead of commodities, now being considered and offered by the USDA, is an uncertainty. We cannot operate programs, as all of you are well aware, on an offer of some kind. We cannot operate on promises.

We would like to have the opportunity to sit down with a group of USDA officials, or with the group of USDA officials who determine which foods are to be purchased and discuss their proposed purchases.

We accept all commodities that are offered. However, those commodities that help us serve the meal requirements are much more helpful to keep our costs down than are some of the other commodities that are served as extra foods, when we are speaking about holding down costs.

The proposed USDA budget for fiscal year 1975 asked for $290 million for commodities. For the past several years, we have tried to find out how the budgeted amount was broken down—in Section 32 or 416, and for the different participating programs. This simply has not been easy to find this out.

As I present this breakdown today, I cannot vouch for its correctness. State agencies need to be advised of this breakdown in order to distribute commodities fairly and equitably on a pro rata basis based on average daily participation. We need to know the value of commodities assigned to each program so that we can divide them evenly.

The best information obtainable seems to be of the $290 million—an estimated 4 billion lunches at 7 cents, an estimated 275 million breakfasts at 3 cents, and an estimated 300 million meals under the special food service program, at less than 0.5 cent per meal.

Now, this would equal a total of $290 million. If sponsors of the service institutions of the special food service program were going to get less than 0.5 cent in commodities next year, they are in trouble financially.

Again, I want to repeat, we need to know by programs so that we can distribute those commodities fairly and equitably.

Summer camps: None. Senior citizens: None. Disaster feeding: None. And, home economics training: None.

In addition to this unknown factor about the breakdown of commodity value by child nutrition program, in closing, I make this request: That the committee give further consideration to the fact that 7 cents worth of commodities purchased a greater quantity of commodities 3 years ago—or even 2 years ago—than the same 7 cents will purchase today. Inflation has affected the quantity of commodities—the original 7 cents is not purchasing the original 7 cents amount of commodities.

Again, Mr. Chairman, thank you for the opportunity to testify, and I will be glad to answer any questions. I do have information with me about this year's participation, if time permits, and if you wish to have it presented.