In recent years, Congress has maintained close oversight over the efforts of FSIS and the meat and poultry industry to address the issue of microbiological contamination, which has been responsible for outbreaks of severe and sometimes fatal foodborne illness. Although most consumer advocates, the meat and poultry industries, scientists, and USDA officials state that recent reforms are a step in the right direction, the issue for the Congress is how to maintain progress and whether further improvements in meat and poultry safety -- through regulatory and/or legislative changes -- are needed.

In July 1996, USDA began to implement a new system of inspection in slaughtering and processing plants. Called HACCP (for Hazard Analysis and Critical Control Point), the system is intended to prevent meat contamination by microbial pathogens at points along the manufacturing chain where it is most likely to occur. Plants with 500 or more employees (which account for 75% of all U.S. slaughter production and 45% of all processed product output) have been required to have a HACCP plan in place since January 26, 1998. As of January 2000, all plants are required to be operating under a HACCP plan.

Implementation of HACCP has not quelled congressional interest in additional food safety reforms, however. In the 106^th Congress, measures have been introduced to (1) give USDA the authority to recall suspected tainted meats (currently USDA asks the packer to recall products voluntarily), and to levy civil penalties against chronically problematic packing operations, (2) require country-of-origin labeling on retail meats, (3) prohibit imported meats from carrying the USDA quality grade label, (4) permit interstate sales of meat and poultry that have been inspected under state programs, and (5) consolidate all federal food safety activities under a new Food Safety Administration.

In addition to these issues, two recent court rulings have challenged FSIS's statutory authority to: (1) use Salmonella bacteria test results as a basis for enforcement decisions, and (2) conduct an FSIS pilot project in which inspectors do more supervising and microbiological testing while packing plant employees perform certain hands-on tasks that the inspectors used to do.

In the FY2001 appropriations process, the House-passed version of H.R. 4461 would provide $673.8 million in appropriated funds for FSIS and the Senate-passed bill would provide $678 million. Both chambers expect that about $83 million in user fees collected for overtime and holiday inspection also will be available. The FY2000 program level for meat and poultry inspection is $751 million ($649.4 million appropriated and $102 million in user fees). The Administration has threatened to veto the agricultural appropriations measure, saying, among other criticisms, that the proposed FSIS funding is too far below the President's request of $688 million to permit the continuation of necessary new food safety initiatives.

In August 2000, GAO released the results of a congressionally requested study of FSIS and FDA recalls of suspected contaminated food. GAO recommends that the two agencies provide more guidance to food companies on carrying out recalls and collect significantly more data on the timeliness and methods of companies' recalls.

Following years of scientific and policy debate, FSIS began a major reform of the meat and poultry inspection system in 1996. For the most part, consumer advocates, the meat and poultry industries, scientists, and Department officials agree that the new inspection procedures should help to reduce the incidence of microbiological contamination. Congress is maintaining close oversight over the reforms to ascertain their effectiveness and evaluate their costs to consumers and the industry. In addition, the 106^th Congress is concerned about meat-related food safety issues as they relate to imported meats, state-inspected meats, and USDA's authority to make mandatory meat recalls.

FDA also is responsible for the inspection of meat from wild game or exotic species sold for human consumption, including venison (from ranched deer), bison, and rabbits. (On April 27, 1999, Representative Hilliard introduced the Rabbit Inspection Act (H.R. 1574), which would authorize FSIS to inspect rabbits under the Federal Meat Inspection Act in addition to under FDA's authority). FDA also has primary responsibility for meat from emu, ostrich, and rhea (large birds collectively known as ratites). However, since 1995, ratite producers have been able to have their birds processed under FSIS inspection under a voluntary, fee-based ratite inspection program. (On May 25, 1999, Senator Grams introduced a bill, S. 1133, that would require mandatory inspection of ratite meat under the Poultry Products Inspection Act. The House-passed version of the FY2001 USDA appropriations measure, H.R. 4461, contains a provision similar to S. 1133. The appropriations bills are awaiting conference.)

The primary goals of the FSIS inspection programs are to prevent adulterated or misbranded animals and products from being sold as food, and to ensure that meat and poultry are slaughtered and processed under sanitary conditions. Uninspected and condemned products cannot be sold for human consumption in domestic or foreign commerce. Requirements also apply to intrastate commerce (for which either USDA programs or federally approved state programs must be in place). Imports from foreign countries must be processed under equivalent inspection systems and be certified prior to entry into the United States. The FSIS requirements cover, among other things:

Plant Sanitation. No meat or poultry establishment can slaughter or process products for human consumption until FSIS approves in advance its plans and specifications for the premises, equipment, and operating procedures. Once this approval is granted and operations begin, the plant must continue to follow a detailed set of rules that cover such things as proper lighting, ventilation, and water supply; cleanliness of equipment and structural features; and employee sanitation procedures.

Slaughter Inspection. A key feature of the program is that FSIS must inspect all meat and poultry animals at slaughter on a continuous basis; that is, no animal may be slaughtered and dressed unless an inspector has examined each carcass. One or more federal inspectors are "on the line" during all hours the plant is operating; the appropriate number depends upon each plant's production level.

Since the program's inception, inspectors have relied mostly on organoleptic detection procedures -- sight, touch, and smell. They conduct both antemortem (before slaughter) and postmortem (after slaughter) inspection. Inspectors look for signs of disease, contamination, and/or other abnormal conditions.

Processing Inspection. Since World War II, an increasing amount of meat and poultry has gone into processed products like hot dogs, lunch meat, prepared dinners, and soups. Processing inspection does not require an FSIS inspector to remain constantly on the production line or to inspect each and every processed item. Instead, inspectors are on site daily to monitor operations, check sanitary conditions, examine ingredient levels and packaging, review records, and conduct statistical sampling and testing of products. Processing inspectors often have responsibility for two or more plants that must be visited each day; consequently, these plants are processing meat or poultry without on-site federal oversight for a large portion of their workday. Nonetheless, because each plant is visited daily, processing inspection is considered to be continuous.

Coverage. FSIS's legal inspection responsibilities do not begin until animals arrive at slaughterhouses, and they generally end once products leave processing plants. The agency has no regulatory jurisdiction at the farm level. Also, certain custom slaughter and most retail store and restaurant activities are exempt from federal inspection. In addition, many flesh foods are not subject to mandatory inspection under the meat and poultry acts, including venison, rabbit, quail, buffalo, and seafoods (even those fish and shellfish raised through aquaculture), although they are subject to less intensive FDA regulatory oversight under the Food, Drug, and Cosmetic Act. Processors of these other flesh foods may request more rigorous USDA inspection as a service under the Agricultural Marketing Act, but must pay its cost.

Enforcement Authority. FSIS has a range of enforcement tools to prevent adulterated or mislabeled meat and poultry from reaching consumers. On a day-to-day basis, if plant conditions or procedures are found to be unsanitary, an FSIS inspector can, by refusing to perform inspection, temporarily halt the plant's operation until the problem is corrected. Contaminated, adulterated, and misbranded products, or parts of them, can be condemned and removed from the marketing chain. Other tools include warning letters for minor violations; requests that companies voluntarily recall a potentially unsafe product; a court-ordered product seizure if such a request is denied; and referral to federal attorneys for criminal prosecution. Prosecutions under certain conditions may lead to the withdrawal of federal inspection from offending firms or individuals. Without inspection, plants are prohibited from operating.

Currently the Secretary must go to the courts in order to recall potentially unsafe products if a firm refuses to issue a recall voluntarily, and he does not have the authority to levy civil fines against companies that produce contaminated products. In August 2000, GAO released the results of a congressionally requested study on FSIS and FDA recalls. The report, Food Safety - Actions Needed by USDA and FDA to Ensure that Companies Promptly Carry Out Recalls, criticized the agencies' efforts in making sure that companies carry out recalls quickly and efficiently, particularly of products that may carry severe risk of illness. GAO also stated that neither FDA nor FSIS compile sufficient information on companies' recall schedules or methods, and that determining the need for mandatory recall authority could not be done until such data were available. (See Microbial Testing section below for current enforcement authority issues.)

The 1985 NAS report recommended the adoption of an HACCP system (Hazard Analysis and Critical Control Point). In this system, hazards are identified and risks are analyzed in each phase of production; "critical control points" for preventing such hazards are identified and monitored; and corrective actions are taken when necessary. Record keeping and verification are used to ensure the system is working. The packing industry was generally receptive to NAS's recommendations. Numerous plants, particularly the larger ones, were already using HACCP-type processes, and supported the idea of making them a mandatory part of food safety regulation.

Even prior to the NAS review, USDA had embarked upon a series of regulatory initiatives to implement a reform strategy based on allocating resources according to risk, adopting advanced technologies, and sharing more food safety responsibilities with the industry. After a fatal outbreak of meat-related E. coli O157:H7 food poisoning in 1993, the Department expanded its testing program to test for pathogenic bacteria on various species and products (it had begun this in 1992) and stepped up other food safety-related efforts. Subsequently, in February 1995, under existing authorities, USDA published a proposed rule to systematize the reforms it had already implemented in the context of a mandatory HACCP plan for meat and poultry inspection.

Sanitation. By January 27, 1997, all meat and poultry slaughter and processing plants were required to prepare and implement site-specific standard operating procedures (SOPs) for sanitation -- activities such as cleaning procedures to be used before and during production to prevent contamination of products. The SOPs must be documented and records maintained; USDA inspectors verify a plant's compliance.

HACCP. Plants are required to develop, adopt, and implement an HACCP plan for each of their processes. Industry is responsible for identifying hazards and controlling and monitoring operations. FSIS's major role is to verify that HACCP is working. Plants with 500 or more employees (which account for 75% of all U.S. slaughter production and 45% of all processed product output) were required to operate under their HACCP plan on January 26, 1998. Plants with 10 to 500 employees began operating under the new rules on January 25, 1999, and those with fewer than 10 employees or annual sales of less than $2.5 million began operating under HACCP plans on January 25, 2000.

Microbial Testing. The new rule institutes two types of microbial testing to verify that plant safety procedures are working and to measure plant performance in reducing pathogens:

• All meat and poultry slaughter plants must regularly test carcasses for generic E. coli in order to verify that their systems are effectively controlling fecal contamination. Although all slaughter plants were required, by January 27, 1997, to begin testing and keeping records, the results will not be used as a standard for enforcement purposes. The testing is intended only as a process verification tool for plants and inspectors. However, plants are required to follow approved testing procedures and methods; and failure to meet specified performance criteria will result in USDA's working with the plant to improve sanitation and process controls. Testing frequency varies, from many tests daily in high volume plants to once a week in the smallest ones.

USDA states that generic E. coli was chosen because it is the best microbial indicator of fecal contamination, the primary vehicle for such potentially dangerous bacteria as Salmonella, Campylobactor, and E. coli, O157:H7.

• Both slaughter plants and those that produce raw ground product must begin to meet or stay below a national standard incidence rate for Salmonella contamination. USDA said that it chose Salmonella over other bacteria because it is the leading cause of foodborne illness, it is one of the most common foodborne bacteria, it is easy to test for, and its reduction also will cause reductions in other foodborne pathogens. The national standard varies by product. For example, it is set initially at 1% of samples testing positive for steers and heifers, 7.5% for ground beef, 20% for broilers, and 49.9% for ground turkey. Plants with higher levels than the standard are required to take remedial actions in order to meet the targets; failure to meet USDA standards by a third testing series can lead to suspension of inspection, which effectively closes the plant.

USDA inspectors conduct the Salmonella testing. Plants were required to begin meeting the standards when they implemented their HACCP plans (see above).

Reaction to the mandatory HACCP regulations has been mixed. As mentioned above, a significant portion of the packing industry already was using HACCP-type processes before they became mandatory. Most of these plants already conduct their own pathogen testing, but events since the start of HACCP implementation indicate that although plants for the most part have been staying within the new national Salmonella standard, the industry finds the standards problematic. Consumer advocacy organizations such as the Center for Science in the Public Interest and Safe Tables Our Priority generally applauded the new rules, contending, among other things, that the testing program will reduce pathogens by forcing companies to emphasize prevention in their HACCP plans.

However, other members of the meat and poultry industry argue that the regulation goes too far beyond HACCP, by establishing what they view as impractical, expensive microbiological testing and unrealistic microbiological standards. They also are opposed to adding HACCP onto existing requirements, claiming that the regulatory burden for meat and poultry processors will increase, with no tangible improvement in public health.

On December 20, 1999, a coalition of seven major meat industry trade associations petitioned FSIS to revise certain sections of the 1996 HACCP final rule. The petition asks FSIS to tighten and clarify certain definitions pertaining to: (1) what constitutes a hazard under HACCP, (2) the extent of a plant's responsibility after the product is shipped; and (3) events that signal that a plant's HACCP plan is inadequate. FSIS published the petition in the May 15 Federal Register (pp. 30952-30956) and asked for responses to six specific questions concerning the scientific and regulatory aspects of the petition. The original comment period ended July 14. On July 25, FSIS reopened the comment period until September 12, 2000. According to FSIS officials, the agency may open a third comment period.

Recent HACCP-related Legal Actions. In December 1999, FSIS attempted to withdraw inspectors from a processing firm in Texas whose ground beef products had repeatedly violated Salmonella levels (withdrawing inspectors effectively closes down a plant). However, the firm obtained a federal court injunction on December 20 to prevent FSIS's action. The firm argued that high Salmonella levels did not indicate the presence of other dangerous pathogens, and that the plant had never failed to meet standards for sanitation. Then, on December 25, FSIS testing confirmed E. coli O157:H7 contamination in the firm's product, resulting in the recall of more than 180,000 pounds of ground beef. Because of this finding, FSIS on January 13, 2000, filed a motion to stop the order preventing the agency from withdrawing inspectors from the plant. In February 2000, FSIS and the Texas firm came to an agreement on a plan to correct the problem with Salmonella levels until the judge ruled on the FSIS motion. On May 25, 2000, the federal judge ruled that the meat and poultry inspection statutes did not give FSIS authority to use the Salmonella standard as the basis for withdrawing inspection. In June the plant again failed the Salmonella performance standard. FSIS could not suspend inspection due to the court order, but asked the plant to suspend its ground beef operations voluntarily until corrective actions could be taken.

Consumer groups are highly critical of the judge's ruling. USDA announced that it planned to file an appeal, although it has not done so to date. Although the ruling applies only to meat processors in the judge's district, some officials are concerned that other plants might begin to challenge the Salmonella performance standard. USDA states, however, that only three of the 6,400 federally inspected plants have ever failed to meet the standard. Supporters of mandatory testing and microbiological standards, as well as of increased enforcement powers, cite this case to bolster their arguments. Opponents contend that using pathogen testing results as an enforcement standard cannot be put in the regulations without underlying statutory language and that what constitutes an unsafe level of Salmonella in ground meat has not been scientifically determined.

On June 21, 2000, Senator Harkin introduced S. 2760, a measure intended to clarify the Secretary's authority to establish enforceable performance standards for the reduction of microbiological pathogens in meat and poultry. On July 19, Senator Harkin sought to amend language to the FY2001 USDA appropriations bill that would deny an "inspected and passed" label to any product that did not meet microbiological performance standards established by the Secretary. The amendment failed.

On June 30, 2000, a federal appeals court ruled on another suit with far-reaching implications for the HACCP program. In 1998, the meat inspectors union charged that a pilot project that FSIS planned to begin in October 1999 would violate language in the meat and poultry inspection statutes that mandates carcass-by-carcass inspection at slaughter operations. The pilot project, called the HACCP-based inspection models project (HIMP), permits FSIS inspectors at approximately 30 chicken, turkey, and swine slaughtering operations to leave the inspection line periodically to conduct increased sampling for microbiological contaminants and to verify the compliance records of plant employees who are now carrying out some of the hands-on inspection and corrective actions that inspectors used to do. In July 2000, FSIS released preliminary data showing that chicken slaughtering plants operating under the HIMP system experienced a 100% decrease in the incidence of diseased carcasses and a 92% decrease in fecal contamination on carcasses, a leading source of potentially illness-causing bacteria.

The June 30 ruling upheld the union's position concerning the statutory language, but did not prohibit FSIS from proceeding with the pilot project. On August 25 the union asked the court to stop the project, but an official order has not yet been issued. In the meantime, FSIS on September 18 implemented changes in the project that it considers adequate to address the union's concerns. USDA officials and industry observers note that the court's decision is based on a strict interpretation of the language in the inspection laws and not on the efficiency of a change in division of labor or the effectiveness of the HIMP project from a food safety standpoint.

Both this ruling and the Texas ruling raise the question of whether USDA's existing authority is sufficient to carry the HACCP program past its initial stages toward USDA's goal of a science-based system. The Senate Agriculture Committee held a hearing on these issues September 20, 2000, but neither chamber has introduced or suggested a major statutory overhaul so far.

Supporters of irradiation as a food safety technology claim that it will significantly reduce the public health threat, particularly from ground beef that may be contaminated with E. coli O157:H7 (the process also can reduce the levels of Salmonella and other major foodborne pathogens). Some consumer groups support irradiation for food safety purposes, but state that it is not a panacea -- good sanitary conditions through final preparation still will be necessary -- and that it raises other issues concerning worker and environmental safety. Other interest groups remain concerned that it may alter the nutrient content of meat. An August 2000 GAO report to Congress concluded that the cumulative evidence from more than 40 years of research in U.S., European and other laboratories indicates that irradiated food is safe to eat. Red meat processors are interested in the technology, but state that they would like to be assured of consumer acceptance before committing themselves to the high cost of installing the equipment. The technology might be adopted first in institutions that serve high populations of immune-compromised people, such as nursing homes and hospitals. Although some research studies show potential consumer acceptance of irradiated ground beef could be as high as 50%, observers still expect the technology to be adopted slowly.

Problems with setting the standards have caused program implementation to lag far behind the original 1993 target date. Despite the lack of a program, fruits and vegetables are permitted to bear labels stating that they have been certified organic under a private or state organic standards program. However, because meat and poultry are required to be federally inspected, FSIS traditionally has not permitted organic labeling in the absence of federal organic standards for such products. Organic industry spokespersons have argued that this limits consumer choice and the industry's market opportunities. Given the delay in implementation of the National Organic Program, FSIS announced in January 1999 that, effective immediately, meat and poultry could carry private or state organic certification labels. The agency followed up with a notice in the April 12, 1999 Federal Register that spells out the requirements for FSIS label approval in greater detail. (For further information, see CRS Report 98-264 , Organic Foods and the Proposed Federal Certification and Labeling Program.)

In a related area, Representative Serrano introduced a bill in January 1999 (H.R. 261) that would require consumers to be notified if the meat (or other foods) they are buying comes from livestock raised on land to which sewage sludge has been applied, or from animals whose feed was grown on sludge-fertilized fields. The National Organic Program, once it is implemented, likely will prohibit foods produced on land to which sludge has been applied from being labeled as meeting USDA organic requirements.

"Free-farmed" Labeling Program. In September 2000 the American Humane Association issued standards for humane on-farm treatment of chickens and cattle (including dairy cattle) and created an agency, Farm Animal Services, to inspect the farms of producers who voluntarily decide to participate. USDA will permit farms that pass inspection to put a "Free-Farmed" label on their products, and it will monitor the inspection process. The program coincides with recent moves by large food service companies, such as McDonalds, to appeal to consumers' social and environmental concerns as well as to their food wants.

Ground Beef Testing. In October 1994, FSIS began testing samples of raw ground beef for E. coli O157:H7 and declared that any such product found with this pathogen would be considered adulterated -- the first time a foodborne pathogen on raw product was declared an adulterant under the meat inspection law. Industry groups immediately asked a Texas federal court for a preliminary injunction to halt this effort, on the grounds that it was not promulgated through appropriate rulemaking procedures, was arbitrary and capricious, and exceeded USDA's regulatory authority under law. In December 1994, the court denied the groups' request, and no appeal was filed, leaving the program in place. FSIS has taken roughly 38,000 samples since the program began; to date, 100 samples have tested positive.

Egg Safety Action Plan. On December 11, 1999, the Administration announced a plan to improve egg safety with the intent of reducing Salmonella Enteritidis illnesses by 50% in 5 years. Under the new plan, egg producers will be required to adopt on-farm flock management and sanitation practices, including pathogen testing and diversion of eggs to pasteurization or cooked products based on test results. The plan calls for FDA to be responsible for developing the on-farm preventive controls, to be enforced by state agencies, and for FSIS to develop and enforce standards for packers and processors. Egg safety legislation also has been proposed (see next section).

The earlier proposals followed an August 1997 outbreak of foodborne illness that led to a voluntary recall of 25 million pounds of frozen beef patties potentially contaminated with E. coli O157.H7 (the largest recall in history). There was a hearing on the Senate measure in the second session (S. 1264), but legislators took no further actions on either bill before the end of the 105^th Congress.

At the October 1997 Senate Agriculture Committee hearing on S. 1264, Secretary Glickman testified that the Department needs these new enforcement tools to improve food safety in general, and to strengthen USDA's enforcement of the new HACCP system in particular. He stated that civil fines would serve as an effective deterrent, and could be imposed more quickly than criminal penalties or the withdrawal of inspection. He also argued that the authority to assess civil penalties would permit USDA to take stronger action against "bad actors" -- processors who persistently violate food safety standards. Concerning the authority to mandate product recalls, Secretary Glickman maintained that it would serve as a backup guarantee in case the voluntary recall system moved too slowly or was not comprehensive enough. Representatives of consumer groups and food safety advocacy groups testified in favor of S. 1264.

Meat and poultry industry trade associations testified in opposition to granting USDA new enforcement powers at the hearing. Both producers and processors argued that current authorities are sufficient and that there has never been a time when a company did not comply with USDA's recommendation to recall a suspected contaminated product. Industry representatives also testified that USDA's current authority to withdraw inspection, thereby shutting down a plant, is a strong enough economic penalty to deter potential violators and punish so-called bad actors.

Some Senators at the hearing argued against expanding USDA's enforcement authority for other reasons. One stated that the traditional inspection system, which is being joined but not replaced by the new HACCP approach, is still flawed and in need of further reform by the Department before Congress grants additional enforcement powers. Others argued that the new enforcement powers would increase the potential for plants to suffer drastic financial losses from suspected contamination incidents which could ultimately be proven false. Some also maintained that much still needs to be done in educating consumers and restauranteurs about safe meat and poultry handling and cooking practices.

No action has been taken on the bills in the 106^th Congress. In August 1999, Senator Harkin asked GAO to investigate the effectiveness of USDA and FDA recall policies in order to inform Congress on the need for mandatory recall authority. The report that GAO released in August 2000 recommends that the two agencies provide specific guidance to companies on time frames for expeditious recalls and collect more follow-up information on the recall timeliness and methods. GAO states that without these data, it is not possible to determine whether mandatory recall authority is necessary.

Relatedly, on September 19, 2000, FSIS published a proposal in the Federal Register to share more information with state and other federal agencies concerning the specific retail establishments that may have received suspected contaminated meat, poultry or egg products. Under the Freedom of Information Act, this information has been considered proprietary and thus has not been released either to the public or to state or other agencies that may be involved with monitoring a recall. FSIS proposes to disclose proprietary information to governmental agencies if the latter sign written agreements not to release that information further without permission from the company making the recall or from FSIS.

In general, consumer groups that support the proposal say that a single food safety agency would result in more consistent and efficient regulation. Opponents of the idea (primarily food processors and retailers) maintain that such an agency would only result in bureaucratic reshuffling and not address reforms that they argue are still needed in the inspection process itself.

In connection with the earlier proposals, Congress in 1997 asked the NAS to prepare a report that would, among other things, provide recommendations on scientific and organizational changes in federal food safety activity need to ensure an effective science-based food safety system. The report, Ensuring Safe Food from Production to Consumption, which was released in late summer of 1998, recommended a centralized and unified federal framework for the U.S. food safety system and gave some examples of possible organizational restructuring to achieve it. The NAS committee offered as options: (1) a Food Safety Council reporting to Congress and controlling a unified budget; (2) the designation of one lead agency for food safety among the several now involved, with that agency's administrator to oversee a unified budget and strategic plan; (3) a single agency reporting to one current cabinet-level secretary; and (4) an independent single agency at cabinet level.

In response to the NAS report, President Clinton established a President's Council on Food Safety in August 1998 and charged it with developing a comprehensive strategic federal food safety plan. On July 15, 1999, the Council delivered to the Administration a plan for a Joint Institute for Food Safety Research, to be co-chaired by Agriculture Secretary Glickman and Human Services Secretary Shalala. At a hearing on Senator Durbin's Safe Food Act (S. 1281) held before the Senate Subcommittee on Government Management, Restructuring and the District of Columbia on August 4, 1999, the Council testified that it expected to present its strategic federal food safety plan to the President before autumn 2000 and that it would include an assessment of options for restructuring or reorganizing the several federal agencies currently responsible for food safety. On January 7, 2000, the Council published a preliminary draft http://www.foodsafety.gov/presidentscouncil.html and held a public meeting on January 19 to obtain public comment on it.

On November 5, 1999, Senator Durbin introduced legislation to require that FSIS adopt the HACCP system in its egg inspection activities (the Egg Safety Act of 1999, S. 1868). The proposal also would require: (1) warning labels and safety instructions on egg cartons; (2) uniform expiration dates on eggs; (3) diversion of eggs returned from retail outlets to uses other than for human consumption unless they are pasteurized; and (4) testing flocks for Salmonella and diversion of eggs from flocks that test positive (among other provisions). The Administration's Egg Safety Action Plan that was announced on December 11, 1999 (see Regulatory Activities above) would assign new roles to both FSIS and FDA for developing safety standards and for enforcement and surveillance.

The conference agreement on the FY2000 agriculture appropriations bill (P.L. 106-78) contains $649.4 million in appropriations for FSIS (a 5.25% increase) and assumes the collection of $89 million in user fees, same as FY1999. The Administration's FY2001 budget request proposes a $771 million program level for FSIS, of which $688 million would be appropriated and the balance would come from user fees collected from packers and processors (as well as some from trust funds). The House-passed version of H.R. 4461 would provide $673.8 million in appropriated funds for FY2001, and the Senate's would provide $678 million. It is expected that an additional $83 million would be available from user fees. The House-passed H.R. 4461contains a provision that would make federal inspection of ratites (emu, ostrich, rhea) mandatory under the Poultry Products Inspection Act. FSIS has been operating a voluntary, fee-based inspection system for ratites for several years.

President's Food Safety Initiative. In order to increase federal support for food safety activities government-wide, the President announced a national initiative to improve food safety in January 1997. In May 1997, the lead agencies -- USDA, the Department of Health and Human Services, and the Environmental Protection Agency -- and the Administration announced a strategic plan, entitled "Food Safety from Farm to Table," along with a request for increased funding for food safety research and surveillance.

The FY2000 agriculture appropriations law contains nearly $137.7 million for USDA food safety initiative activities. The FY2001 budget requests $165.3 million for USDA's initiative-related activities, including implementation of an Egg Safety Action Plan that the Administration announced in late 1999 (see above). The House bill would provide $144.7 million overall for the initiative; the Senate measure would provide $165.5 million. Of those amounts, both bills would allocate $28.8 million to FSIS - a $7.3 million increase over the current year. The President is threatening to veto the FY2001 agricultural appropriations measure if Congress does not provide more funds for food safety as well as for several other missions he considers critical. According to USDA Under Secretary Woteki, FY2001 is the last budget request that will propose funding for the food safety initiative. It is expected that beginning in FY2002, the initiative will be folded into a comprehensive budget request formulated by the President's Food Safety Council pursuant to the strategic plan that the Council is due to release sometime later this summer.

The conferees on the FY1999 agriculture appropriations bill adopted language (subsequently included in the omnibus spending measure) directing the Secretary to report to the Appropriations Committees by March 1, 1999 with recommendations on lifting the ban. USDA informed the House Agriculture Committee (after the deadline passed) that it would instead be sending up proposed legislation to lift the ban. Senators Daschle and Hatch introduced the Department's proposal on November 19, 1999. S. 1988 (the New Markets for State-Inspected Meat Act) would amend the Federal Meat Inspection Act and the Poultry Products Inspection Act to allow state-inspected products to bear the official USDA inspection mark if the state program has entered into a cooperative agreement with USDA. The agreement would require the state program to enforce the same federal requirements enforced by the Department. State programs would have from October 1, 2001 to September 30, 2002 to make the transition to meeting full federal requirements. Under the proposal, USDA would reimburse 60% of a cooperating state's inspection costs (it currently reimburses 50%). State programs that chose not to make the transition would be taken over by USDA. At an April 6, 2000 hearing on the proposal, representatives of state departments of agriculture, state meat processing associations, the American Farm Bureau Federation, the National Cattlemen's Beef Association, and several major consumer and food safety organizations testified in support of S. 1988. Testifying in opposition to the bill was the American Meat Institute (AMI), which represents the manufacturers of about 70% of U.S. meat products. AMI states that it will not support the bill unless changes are made to require greater uniformity between federal and state inspection programs.

Representative Thornberry introduced a different proposal concerning interstate commerce and state-inspected meats on April 28, 1999. H.R. 1617 would phase in the removal of interstate distribution restrictions on state-inspected meat and poultry by January 25, 2000. However, the bill does not specify any changes that state programs would be required to make in order for state-inspected products to enter interstate commerce.

In an alternative approach to country-of-origin labeling, conferees on the FY2000 agriculture appropriations law included report language directing the Secretary to consult with the U.S. cattle industry and promulgate regulations "defining which cattle and fresh beef products are 'Products of the U.S.A.'" The intent is to "facilitate the development of voluntary, value-added promotion programs that will benefit U.S. producers, business, industry, consumers, and commerce." Although the provision is meant to avoid the potential trade problems associated with country-of-origin labeling, meat packers and retailers foresee difficulties in coming up with standards for what constitutes U.S. beef that do not also cause problems (e.g., how long must Canadian beef cattle be in the United States before slaughter to qualify as U.S. beef?). (For further information, see CRS Report 97-508, Country-of-Origin Labeling for Foods: Current Law and Proposed Changes.)

On a related issue, Senator Johnson introduced a bill on January 19, 1999, that would make it illegal to give a USDA meat quality grade (such as "USDA Prime," etc.) to imported beef and lamb (S. 241). Senator Burns introduced a similar measure on April 13, 1999 (S. 788; Representative Hill introduced a companion measure, H.R. 1698, on May 5, 1999). Meat grading is a voluntary service that USDA's Agricultural Marketing Service provides on a fee basis. Currently, meat from cattle and sheep that are imported live for slaughtering in the United States or as carcasses can be given a USDA quality grade, whereas imported boxed meat cannot.

Meanwhile, only a handful of U.S. plants are certified to export meat into the EU due to the EU's "Third Country Meat Directive," and to its ban on imports of meat from animals treated with growth-promoting hormones (accounting for most of the U.S. beef cattle). Under the Third Country Meat Directive, meat products from the United States (and other outside countries) effectively must be inspected under standards identical to the EU's and/or be certified by EU officials themselves. Most U.S. beef exports to the EU already had been halted because of the beef hormone ban, which the EU instituted on January 1, 1989, citing consumer concerns about the safety of their use.

Prior to 1989, several hundred U.S. beef and pork plants had been approved to export to the EU. By the end of 1990, the EU had delisted virtually all of them. The few still exporting to Europe have been individually approved by EU reviewers as meeting EU inspection standards under terms of the so-called 1992 Red Meat Agreement.

The beef hormone ban also has constrained beef exports to the EU. World Trade Organization (WTO) dispute settlement panels have twice ruled that the ban lacks a scientific basis and is inconsistent with the Uruguay Round Sanitary and Phytosanitary (SPS) Agreement. The WTO left open the option for the EU to conduct a risk assessment of meat from hormone-treated animals; and gave the EU until May 13, 1999, to bring its hormone measure into compliance with SPS rules. The EU did not meet this deadline. In response, the United States imposed economic sanctions beginning July 29, 1999, in the form of 100% import tariffs on EU products valued at $117 million (the official U.S. estimate of lost annual U.S. beef sales to the EU).

Complicating matters, the EU threatened in spring 1999 to ban U.S.-certified hormone-free beef imports (valued at about $24 million annually), after finding hormone residues in samples. After the United States announced it was tightening surveillance measures, the EU postponed its ban from June until December 1999 and then subsequently until March 15, 2000. On that date the EU announced that it would lift the ban for imports of beef, pork and horsemeat from U.S. plants that contract to have EU residue testing laboratories certify their product as hormone-free. Industry analysts predict that only a small amount of meat will be exported under this program.

U.S.-EU differences over poultry meat safety also remain a point of contention. The key area of dispute has been the EU's opposition to U.S. processors' use of chlorinated water for washing poultry carcasses. The EU contends that the process is ineffective in removing bacteria, and that the chlorine itself may pose a danger to human health. U.S. poultry companies argue that they must use chlorination in order to meet USDA's pathogen reduction standards under its meat and poultry inspection programs. They also assert that poultry plants in some EU countries also use chlorinated water, and that the United States has been singled out unfairly. Meanwhile, U.S. poultry meat exports to the EU, estimated by USDA at about $50 million annually, have been blocked since April 1997. Representative Meek introduced legislation related to this issue on July 21, 1999 (H.R. 2581, the Ensuring the Safety of Imported Meat and Poultry Act of 1999). Beginning one year after passage, the bill would ban all imports of carcasses of meat or meat products from any country for which the Secretary has not yet determined that the foreign inspection system actually provides at least the same level of sanitary or phytosanitary protection achieved under United States requirements, including pathogen testing requirements. (See CRS Report RS20242 , U.S.-European Union Agricultural Trade: The Veterinary Equivalency Agreement, and CRS Report RS20142, The European Union's Ban on Hormone-Treated Meat.)

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