Perdue’s Inbox at USDA: Trade, Staffing, Budget, Rulemaking

Daily Report for Executives provides in-depth coverage of unfolding legislative, regulatory, and judicial news from the nation’s capital, the states, and around the world. This daily news service...

By Casey Wooten

Sonny Perdue is headed to the Whitten Building, the Agriculture Department’s headquarters in Washington.

The Senate voted 87-11 to confirm the former Georgia governor to be the 31st agriculture secretary April 24, more than 13 weeks after President Donald Trump took office.

Perdue will helm a department of more than 100,000 employees across all 50 states. He’ll also face a bevy of economic and policy challenges facing his department and the broader agriculture sector.

“The things that he got the most questions about as he made the rounds to visit with not only Senate ag senators but others were dairy and trade, so I suspect those two things will be pretty high,” Mary Kay Thatcher, senior director of congressional relations at the American Farm Bureau Federation, said during remarks at the North American Agricultural Journalists conference April 24.

Trade

Trade in the dairy industry looks to be first on Perdue’s to-do list. Perdue is set to leave the nation’s capital for Wisconsin—a major dairy-producing state—this week in his fist trip as agriculture secretary.

U.S. dairy farmers are in an uproar over a new Canadian pricing policy that would effectively block U.S. milk protein concentrates from the Canadian market. Protein concentrates are used to make certain types of cheeses.

The USDA hasn’t yet released an itinerary for Perdue’s Wisconsin trip, but last week Trump called the Canadian policy change “very unfair” during his own trip to Wisconsin. Senate Minority Leader Charles Schumer (D-N.Y.) has said he and Trump have agreed to work together to address the new pricing plan.

The Trump administration is embarking on a broad revamp of U.S. trade policies, from engaging the trade deficit with China to renegotiating the North American Free Trade Agreement. All of those changes could impact U.S. agriculture, one of the few sectors of the economy with a positive trade balance.

In his March 23 confirmation hearing, Perdue pledged to be a voice for agriculture as the White House works through new, bilateral trade deals, saying he would work closely with Robert Lighthizer, Trump’s pick for U.S. Trade Representative.

“So if confirmed, my first stop’s going to be at Mr. Lighthizer’s office door,” Perdue said at his hearing.

Staffing

Perdue will need to nominate dozens of administrative-level positions at the USDA, ranging from deputy secretaries to administrators in some of the 17 agencies that fall within the department.

Thatcher said some appointments might be announced this week.

“I don’t know if that means a deputy secretary, but it definitely means the worker-bee levels,” Thatcher said. “There are people over there that weren’t there two weeks ago that are permanent and not transition.”

Perdue is scheduled to deliver an address to USDA employees the morning of April 25.

Budget

Released March 16, Trump’s proposed fiscal 2018 budget would cut USDA funding by $4.7 billion, a 21 percent drop from current levels and one of the largest drops in funding among departments by percentage.

The budget includes reductions to USDA statistical research, county-level operations and rural development programs, including eliminating a $498 million rural water and wastewater loan and grant program which provides funding for clean drinking water and sewage disposal projects.

The budget provides $17.9 billion for the USDA, but would cut some international food aid programs run by the department and requires the department to reduce staff.

So far, the budget process has taken place without input from a secretary of agriculture. In his confirmation hearing in the Senate Agriculture Committee, Perdue said he would work within the administration to “get agriculture’s share” as the White House and lawmakers hash out a final budget that would get a vote in Congress.

“If I’m confirmed, I’m going to get under the boards and get some room and work for agriculture producers and consumers to let this administration and any other people that are making these decisions in that budget area know what’s important to America,” he said. “I hope, in the context of a balanced budget, that meets the objectives, that we can get agriculture’s share there.”

Ray Starling, the White House’s special assistant to the president for agriculture, trade and food assistance, said the budget proposal was a “first shot” at thinking about how to cut costs across the federal government while increasing funding for national security. To that end, the USDA will likely need to grapple with less funding, he said.

“At the end of the day, will there be some tough decisions to be make? I think the answer to that is yes,” Starling said.

Rulemaking

Early in his tenure at USDA, Perdue is set to grapple with major rulemaking efforts left over from the Obama administration and may need to change their course to better align with the Trump administration’s priorities.

The USDA said April 11 that it would push back implementation of a rule that would rework contract regulations between livestock producers and processors to Oct. 19. Known as the GIPSA rule, the regulations would make it easier for producers like chicken farmers to sue major processors and have been the center of controversy since their mandate in the 2008 farm bill.

The Obama administration released the finalized GIPSA rule in December 2016, a move opposed by influential farm-state lawmakers such as Senate Agriculture Committee Chairman Pat Roberts (R-Kan.) and House Agriculture Committee Chairman Mike Conaway (R-Texas).

The delay casts doubt on whether the Trump administration will advance the regulations as they were published by the Obama administration. Perdue did not weigh in on GIPSA during his confirmation hearing.

Also delayed are regulations creating animal welfare standards for certified organic livestock. The Obama administration released the final rule shortly before leaving office, but in early February the Trump administration delayed its implementation from March 20 until May 19. The rules would expand requirements for living conditions and production practices for organic livestock.

Perdue will also help shepherd rules implementing a nationwide standard for labeling foods made with genetically modified ingredients. Congress passed a GMO labeling bill in July 2016 that gives the USDA two years to craft implementation rules.

Foodmakers would have three options to disclose GMO ingredients: the use of on-package text, a USDA-created symbol, or an internet link printed on the package directing customers to GMO information. Perdue will help decide how electronic labeling will play into that equation. Foodmakers have pushed for more options to use on-package internet links, while consumer advocates call that option inadequate.

Starling said part of the Trump push to streamline regulations will be to combine rulemaking efforts across agencies. The Food and Drug Administration is currently working on a revamp to the nutrition facts panel found on food packaging, and Starling said that combining GMO labeling rules with the new nutrition facts panel—a move favored by industry—is something the administration is considering.

“I think there’s a real active conversation about whether we can do that,” Starling said.

To contact the reporter on this story: Casey Wooten in Washington at cwooten@bna.com

To contact the editor responsible for this story: Paul Hendrie at pHendrie@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

Try Daily Report for Executives