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Vilsack outlines sequester hits to ag

DANIEL LOOKER 03/01/2013 @ 12:14pm Business Editor

Agriculture Secretary Tom Vilsack shared his frustration with Washington gridlock as well as details of how spending reductions will hit agriculture when he spoke to members of corn, grain sorghum, soybean and wheat grower groups at the Commodity Classic in Kissimmee Florida, Friday

"On this day in particular, it's great to be outside of Washington," Vilsack said.

March 1 is the first day of automatic reductions in spending mandated by Congress that President Obama is expected to authorize with his signature later today.

As Vilsack told commodity group members, and reporters later, letters will be going out next week to USDA employees advising them of the unpaid furloughs they'll be facing and in two or three weeks, land grant universities will be informed that they will receive about $60 million less in research funds than they expected this year. The cuts will possibly trim the amount of money received by farmers for direct payments and USDA is trying to decide how to deal with other payments that have already gone out. Crop insurance indemnity payments won't be affected. Meat inspectors will, and being furloughed will temporarily shut down more than 6,000 USDA-inspected processing plants.

Vilsack said he's been asked to get around some of these cuts by cutting other expenses, such as travel.

"Well folks, we've been doing that the last 3 years," he said. And Vilsack must cut from each line of his budget, so he's unable to shift funds from one agency to another.

Cuts already made

Anticipating these spending cuts, USDA has already cut its total workforce 8%. In Washington it has condensed office space and is renting less. It has reduced employee travel, cut down on supplies and sent fewer employees to conferences. USDA workers have not gotten a pay raise in three years.

Conservatively, USDA has found $700 million in savings and the number is probably closer to $1 billion," Vilsack said.

"There's just not a lot that can be done," he said. ""Frankly, I have to apologize to all of you. This is crazy what is happening. In a functioning democracy this shouldn't happen."

Blow to livestock industry

Vilsack has drawn sharp criticism from livestock and meat packer groups for USDA's announced plan to reduce the work hours of meat inspectors. Because processing plants can't operate without USDA inspection, the White House has estimated the entire meat industry could suffer $10 billion in losses.

Earlier this week, a group of Republican senators led by Senator Chuck Grassley of Iowa, wrote a letter to Vilsack asking whether his department has done all it can to reduce expenses before cutting the hours of inspectors. And it asked for the legal basis for reducing USDA's time spent enforcing laws designed to protect food safety.

“Furloughing meat inspectors may shut down meat and poultry facilities and harm workers, farmers, and consumers," Grassley said when he released the letter to the public.  "I find it hard to believe that reductions can't be made elsewhere in the department that don't impact health and safety. If the department believes it needs to go to these drastic measures, the public ought to know if other areas within the department are seeing the same kinds of cost-saving measures as something as important as meat inspectors."

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