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UNITED STATES DEPARTMENT OF AGRICULTURE
Food and Nutrition Service

Statement of Roberto Salazar, Administrator
Food and Nutrition Service
Before the Subcommittee on Agriculture, Rural Development,
and Related Agencies

April 14, 2005

Thank you, Mr. Chairman, and members of the Subcommittee for allowing me this opportunity to present testimony in support of the fiscal year 2006 budget request for the Food and Nutrition Service (FNS).

The Food and Nutrition Service is the agency charged with managing fifteen nutrition assistance programs which create the Nationís nutrition safety net and providing Federal leadership in Americaís ongoing struggle against hunger and poor nutrition. Our stated mission is to increase food security, reduce hunger and improve health outcomes in partnership with cooperating organizations by providing children and low-income people access to nutritious food and nutrition education in a manner that inspires public confidence and supports American agriculture. The budget request clearly demonstrates the Presidentís continuing commitment to this mission and our programs.

A request of $59 billion in new budget authority is contained within the fiscal year 2006 budget to fulfill this mission through the fifteen FNS nutrition assistance programs. These critical programs touch the lives of more than 1 in 5 Americans over the course of a year. Programs funded within this budget request include the National School Lunch Program (NSLP), which will provide nutritious school lunches to almost 30 million children each school day, the WIC Program, which will assist with the nutrition and health care needs of 8.5 million at risk pregnant and postpartum women, infants and children each month, and the Food Stamp Program (FSP), which will ensure access to a nutritious diet each month for an estimated 29.1 million people. The remaining programs include the School Breakfast Program (SBP), The Emergency Food Assistance Program (TEFAP), the Summer Food Service Program (SFSP), the Child and Adult Care Food Program (CACFP), the Food Distribution Program on Indian Reservations (FDPIR), and the Commodity Supplemental Food Program (CSFP) and the Farmersí Market Programs. FNS seeks to serve the children and low-income households of this Nation and address the diverse circumstances though which hunger and nutrition-related problems present themselves and affect our participants within the design and delivery methods of our programs.

The resources we are here to discuss represent an investment in the health, self-sufficiency, and productivity of Americans who, at times, find themselves in need of nutrition assistance. Under Secretary Bost, in his testimony, has outlined the three critical challenges which the Food, Nutrition and Consumer Services team has focused on under his leadership: expanding access to the Federal nutrition assistance programs; addressing the growing epidemic of overweight and obesity; and, improving the integrity with which our programs are administered. In addition to these fundamental priorities specific to our mission, the Presidentís Management Agenda provides an ambitious agenda for management improvement across the Federal Government as a whole. I would like to report on our efforts to address three specific items under this agenda; reducing improper payments and enhancing the efficiency of program delivery, building partnerships with faith and community based organizations, and systematically planning for the human capital challenges facing all of the Federal service.

The Challenge of Improper Payments

Good financial management is at the center of the Presidentís Management Agenda. As with any Federal program, the nutrition assistance programs require sustained attention to program integrity. We cannot sustain these programs over the long term without continued public trust in our ability to manage them effectively. Program integrity is as fundamental to our mission as program access or healthy eating. Our efforts to minimize improper program payments focus on 1) working closely with States to improve Food Stamp payment accuracy; 2) implementing policy changes and new oversight efforts to improve school meals certification; and 3) improving management of Child and Adult Care Food Program providers, and vendors in WIC. We have identified these 4 programs as programs susceptible to significant improper payments and will continue to enhance the efficiency and accuracy with which these programs are delivered. I am happy to report that in fiscal year 2003, the most recent year for which data is available, we have achieved a record level of Food Stamp payment accuracy with a combined payment error rate of only 6.63 percent. This is the fifth consecutive year of improvement, making it the lowest rate in the history of the program. With this budget request, we will continue our efforts with our State partners toward continued improvement in the payment error rate. We will continue efforts to address the issue of proper certification in the school meals programs in a way that improves the accuracy of this process without limiting access of eligible children. New analytical work will begin under this budget request to better assess the accuracy of eligibility determinations in the Child and Adult Care Food Program.

Faith-based and Community Organizations Outreach

Faith-based organizations have long played an important role in raising community awareness about program services, assisting individuals who apply for benefits, and delivering benefits. President Bush has made working with the faith-based community an Administration priority, and we intend to continue our outreach efforts in FY 2006. The partnership of faith-based organizations and FNS programs, including TEFAP, WIC, NSLP, and the CSFP, is long-established. Most faith-based schools participate in the NSLP and many child care providers and sponsors are the product of faith-based organizations. In addition, the majority of organizations such as food pantries and soup kitchens that actually deliver TEFAP benefits are faith-based. Across the country, faith-based organizations have found over the years that they can participate in these programs without compromising their mission or values. They are valued partners in an effort to combat hunger in America. I am happy to report that in the past 6 months we have provided 16 grant awards of approximately $2 million to community and faith-based organizations to test innovative food stamp outreach strategies to reach underserved, eligible individuals and families.

Human Capital Management

We currently estimate that up to 80 percent of our senior leaders are eligible to retire within five years, as is nearly 30 percent of our total workforce. FNS must address this serious challenge by improving the management of the agencyís human capital, strengthening services provided to employees, and implementing programs designed to improve the efficiency, diversity, and competency of the work force. With just nominal increases for basic program administration in most years, the Food and Nutrition Service has reduced its Federal staffing levels significantly over time. We have compensated for these changes by building strong partnerships with the State and local entities which administer our programs and taking advantage of technological innovations. We are extremely proud of what we have accomplished; full funding of the nutrition programs administration request in this budget is vital to our continued success.

Now, I would like to review some of the components of our request under each program area.

Food Stamp Program

The Presidentís budget requests $40.7 billion for the Food Stamp account including the Food Stamp Program and its associated nutrition assistance programs. These resources will serve an estimated 29.1 million people each month participating in the Food Stamp Program alone. Included in this request is the continuation of the $3 billion contingency reserve provided for the program in fiscal year 2005. While we anticipate the improvement in the general economy will at some point begin to impact the program, predicting the turning point of participation continues to be challenging. To better meet this challenge, we have proposed, as an alternative to the traditional contingency reserve, indefinite funding authority for program benefits and payments to States and other non-Federal entities. In addition, we have made a concentrated effort to encourage working families, senior citizens and legal immigrants to apply for benefits.

We need to ensure program access is administered in an equitable manner across all States. The budget contains a proposal to eliminate categorical Food Stamp eligibility for Temporary Assistance for Needy Families (TANF) participants who receive only non-cash TANF services. This proposal, with partial implementation in FY 2006, is expected to impact 161,000 persons and reduce benefits by $57 million among persons with incomes above the normal food stamp thresholds. Fully implemented in FY 2007, this change is estimated to affect approximately 312,000 individuals and save $113 million annually. The Presidentís proposal ensures that Food Stamp benefits go to the individuals with the most need and retains categorical eligibility for the large number of recipients who receive cash assistance through TANF, SSI and General Assistance. Included in the budget is a proposal to add the Food Stamp Program to the list of programs for which States may access the National Database of New Hires. Access to this National repository of employment and unemployment insurance data will enhance Statesí ability to quickly and accurately make eligibility and benefit level determinations, improving program integrity. This proposal is expected to produce a net program savings of $2 million annually beginning in fiscal year 2007.

The budget also requests a continuation of a policy included in last yearís Appropriations to exclude special military pay received by members of the armed forces serving in combat zones when determining food stamp benefits for their families back home. Over the next year, we will also be working with members of this Committee to rename the Food Stamp Program to better reflect its purpose of providing nutrition assistance and promoting health among low-income families.

Child Nutrition Programs

The budget requests $12.4 billion for the Child Nutrition Programs, which provide millions of nutritious meals to children in schools and in childcare settings every day. This level of funding will support an increase in daily School Lunch Program participation from the current 29 million children to approximately 30 million children. Requested increases in these programs reflect rising school enrollment, increases in payment rates to cover inflation, and proportionately higher levels of meal service among children in the free and reduced price categories. We will also put into practice program changes and new activities resulting from the 2004 reauthorization of these programs. These include implementing the newly authorized Fruit and Vegetable Program, and continuing our efforts to promote healthy behaviors by supporting the implementation of local wellness policies. We created the HealthierUS Schools Challenge to encourage communities to improve the foods offered at school and other aspects of a healthy school nutrition environment and to recognize schools that made improvements.

WIC

The Presidentís budget includes $5.51 billion for the Special Supplemental Nutrition Program for Women, Infants and Children, the WIC Program. The request will provide food, nutrition education, and a link to health care to a monthly average of 8.5 million needy women, infants and children during fiscal year 2006. We will continue, with a budget request of $15 million, an initiative begun in fiscal year 2004 and authorized in the programís 2004 reauthorization, to enhance breastfeeding initiation and duration. The $125 million contingency fund provided in the fiscal year 2003 appropriation and reestablished in fiscal year 2005, continues to be available to the program. We currently anticipate using a small portion of the reserve in fiscal year 2005 for projected program costs; the Presidentís budget replenishes the reserve to the $125 million level.

Commodity Supplemental Food Program (CSFP)

The Commodity Supplemental Food Program (CSFP) serves elderly persons and at risk low-income pregnant and post-partum and breastfeeding women, infants and children up to age six. The budget requests $106.8 million for this program, the same level appropriated in fiscal year 2005. Under this funding level, we anticipate a decrease of 44 thousand. We face a difficult challenge with regard to discretionary budget resources. CSFP operates in selected areas in just 32 States, the District of Columbia, and two Indian Tribal Organizations. The populations served by CSFP are eligible to receive similar benefits through other Federal nutrition assistance programs that offer them flexibility to meet their individual needs. We believe our limited resources are best focused on programs available in all communities nationwide.

The Emergency Food Assistance Program (TEFAP)

As provided for in the Farm Bill, the budget requests $140 million for commodities in this important program. Our request for Statesí storage and distribution costs, critical support for the Nationís food banks, is $50 million. The Food and Nutrition Service is committed to ensuring the continuing flow of resources to the food bank community including directly purchased commodities, administrative funding, and surplus commodities from the USDA market support activities. Much of this funding is provided, at the local level, to faith-based organizations. Surplus commodity donations significantly increase the amount of commodities available to the food bank community from Federal sources.

Nutrition Programs Administration (NPA)

We are requesting $140.8 million in this account, an increase of $2 million over our fiscal year 2005 level. This increase will partially offset personal-related costs of the FNS workforce in fiscal year 2006. Our request for Federal administrative resources is needed to sustain the program management and support activities of our employees nationwide. I believe we need this modest increase in funding in order to maintain accountability for our $59 billion portfolio and to assist States to effectively manage the programs and provide access to all eligible people.

Thank you for the opportunity to present this written testimony.


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