UNITED STATES DEPARTMENT OF AGRICULTURE
Food, Nutrition and Consumer Service

Statement of Nancy Montanez Johner, Under Secretary
Food, Nutrition, and Consumer Services
Before the Subcommittee on Agriculture, Rural Development,
Food and Drug Administration and Related Agencies

March 13, 2008

Thank you, Madam Chairwoman, and members of the Subcommittee for this opportunity to present the Administration’s fiscal year 2009 budget request for USDA’s Food, Nutrition, and Consumer Services (FNCS).

Before I begin my testimony, I would like to take a moment to introduce to you the members of the leadership of the Food, Nutrition and Consumer Services mission area who are accompanying me today. At the witness table is Deputy Under Secretary Kate Houston, who previously served as Associate Administrator for Special Nutrition Programs at the Food and Nutrition Service (FNS) and is appearing before the Subcommittee for the first time today, and Roberto Salazar, the Administrator of FNS.

I appear before you this morning to present the President’s fiscal year 2009 budget request for FNS and the Center for Nutrition Policy and Promotion. Over the last eight years, our commitment to the nutrition assistance programs has been guided by three straightforward principles: to reduce hunger and food insecurity by ensuring that all Americans who are eligible and wish to participate can receive program services easily, and with dignity and respect; to help our clients acquire not only good food but also the nutrition skills and motivation they need to improve the well-being of their families; and finally, to be conscientious and accountable stewards of the public investment in these sizable and important programs.

Guided by these simple, yet powerful principles, and working in close cooperation with our State partners, we have made significant strides in achieving the Administation’s objectives for FNCS. Since fiscal year 2001, participation among eligible individuals has increased for all our major programs, reflecting the success of our efforts to increase awareness and understanding of the benefits and requirements of our programs among eligible people, and to improve the participant experience associated with actually accessing those benefits. Over the same period, our commitment to providing our participants both nutritious food and the information necessary to make wise food and physical activity decisions has been evident. Since fiscal year 2001, our annual investment in nutrition education and promotion has grown over 65 percent, from approximately $475 million to about $788 million in our fiscal year 2009 budget request. We have carefully reviewed the commodity foods we provide to our partners and participants directly and taken significant steps to improve those foods, reducing fat and sodium where appropriate and increasing the availability of fruits and vegetables.

We have also worked hard to improve management of these programs at the Federal, State and local levels and to reduce improper payments. I am proud to report that we have concrete results to show for our efforts. Payment accuracy levels in the Food Stamp Program have improved steadily over the last eight years and now stand near record high levels. At the same time, the best available information indicates that the incidence of benefit trafficking has experienced a steady, sustained decline. In the school meals programs we have developed and recently released the first-ever national estimate of payment accuracy. This is a critical step toward a better understanding of this very complex problem and the development of policies that improve accuracy without compromising access for low-income families or unduly increasing the burden on schools.

I am very proud of what we have accomplished and honored to work for a President with a clear, consistent commitment to these programs that protect children and low-income households from hunger, and help to prevent the health risks associated with poor nutrition and physical inactivity.

Madam Chairwoman, this budget request of $64.1 billion reflects the fundamental challenge facing all of us: ensuring that the needs of all eligible persons seeking to participate in our programs are met while at the same time striving to deal forthrightly and responsibly with unsustainable levels of deficit spending and Federal debt. We have been very careful to make certain to provide access to nutrition assistance programs for all eligible populations we serve. We have made tough choices and developed a budget request that makes every dollar produce maximum benefit for the vulnerable populations served by our programs and for the Nation as a whole. Funds requested within the budget fully support our best estimates of demand for program services and cost for the major nutrition assistance programs in fiscal year 2009.

• This includes a monthly average participation level of 28.0 million persons in the Food Stamp Program, an increase of approximately 200,000 over fiscal year 2008 and over 11 million above fiscal year 2001. This increase reflects our success in improving the rate of participation among eligible individuals. From fiscal year 2001 through fiscal year 2005, the last year for which data are available, the Food Stamp Program participation rate increased from 54 percent to 65 percent.

• WIC participation is projected to reach an all-time high in fiscal year 2009. While this is only a slight rise from fiscal year 2008, since fiscal year 2001 participation has increased 18 percent or 1.3 million participants.

• In the school meals programs, daily meal service to our youth is expected to reach 32.1 million students in the National School Lunch Program and 11.2 million students in the School Breakfast Program.

At the most basic level, ensuring program access must begin with making certain that sufficient resources are available so that all who are eligible and in need can have ready access to benefits. The President’s fiscal year 2009 budget requests funds to support anticipated participation levels in the Food Stamp Program, the Child Nutrition Programs and the WIC Program. The Administration’s strong commitment to adequately fund these critical programs acknowledges the inherent difficulties in anticipating future demand for program services. Should our estimates of program participation or costs prove too low, we have continued to protect program access for all eligible persons, a key objective of the President, through contingency reserves. In the Food Stamp Program we have continued the request for athe contingency reserve of $3 billion, providing the program with a total reserve of $6 billion. These funds are especially important if the program is experiencing a period of increased enrollment such as during emergencies or natural disasters. In the WIC Program, $150 million is requested to replenish the contingency reserve to ensure that the essential food, nutrition education, and health care referral services remain available to all eligible women, infants, and children who need them.

The budget request also includes $2.5 million to allow us to examine new ways to better reach historically underserved populations. Specifically, with these resources we would test strategies to increase Food Stamp Program participation rates among the elderly and low-income working households.

Our programs provide nutrition assistance, including both access to healthy food and nutrition education and promotion to support and encourage a healthy lifestyle. With this nutrition mission in mind, we play a critical role in the integrated Federal response to the growing public health threat posed by overweight and obesity which affects well over half of adult Americans.

The Federal nutrition assistance programs play a critical role in combating this pressing public health issue by providing not just access to healthful food, but also promoting better health through nutrition education and promotion of physical activity. These FNS program services, along with the work of the CNPP to improve the diets of all Americans, are a key component of the President’s Healthier US Initiative. I believe the American public is served well by USDA’s contributions to addressing the critical nutrition- and health-related issues facing us today. This budget request provides approximately $788 million in resources tied specifically to improving the diets, nutrition knowledge and behavior and promoting the importance of physical activity among the people we serve.

The budget request includes $2 million to permit FNS to conduct the fourth cycle of our School Nutrition and Dietary Assessment. This data collection and analysis effort will provide critical insight to our continuing efforts to improve the nutritional quality of the school meals programs. Also included is $2 million to facilitate the testing and evaluation of promising State practices in food stamp nutrition education. We believe this work will ultimately lead to improvements in the effectiveness with which we deliver nutrition messages to food stamp households.

The CNPP continues to have an integral role in the development and promotion of updated dietary guidance and nutrition education. The Dietary Guidelines for Americans (Guidelines), published jointly every 5 years by the USDA and the U.S. Department of Human Services (HHS), is the cornerstone of Federal nutrition policy, allowing the Federal Government to speak with one voice. We are currently at the very beginning of developing of the 2010 Guidelines, an initiative that we will lead over the next three years. This request features an increase of $2 million to support the efforts of the CNPP in this leadership role as well ast to maintain and enhance the extremely well-received food guidance system, MyPyramid.gov, which is one of the most frequently visited of all Federal web sites for the public.

With this budget request, we are asking the Nation to entrust us with over $64 billion of public resources. We are keenly aware of the immense responsibility this represents. To maintain the high level of public trust that we have earned as good stewards of the resources we manage, we will continue our ongoing commitment to program integrity as an essential part of our mission to help the vulnerable people these programs are intended to serve.

This is not a new commitment; our record of success is clear. While the Food Stamp Program’s 2006 payment accuracy rate of 94.01 percent represents a slight decrease from the fiscal year 2005 level of 94.16, it represents the third year in a row of errors below 6 percent, and reflects strong improvement from the 2001 level of 91.34 percent. Early indications are that we will continue to see success in this area as fiscal year 2007 data become available.

Our budget request includes an increase of $5.7 million in the Nutrition Programs Administration account focused on sustaining the successful partnerships we have established working with our colleagues at the State level to improve the efficiency, effectiveness and financial integrity with which all of the nutrition assistance programs are administered. We also continue to develop strategies to improve the accuracy of eligibility determinations in our Child Nutrition Programs – an issue of concern to all those that care about these programs. The budget request contains $1 million in the Child Nutrition Programs account to permit us to build on work funded in fiscal year 2008 and previous years to develop initial payment accuracy estimates for the Child and Adult Care Food Program, as required by the Improper Payments Information Act of 2002. Also included in the request is $4.5 million for the demonstration and evaluation of new and innovative ways to modernize the Food Stamp Program application process. We hope that this effort will pay dividends in both streamlining the process and, reducing administrative burden on participants and improving the accuracy of benefit determinations.

The Federal administrative resources provided for in this budget will allow us to advance our close work with our State and local program partners on both of these essential integrity initiatives – continuing both our successes in the Food Stamp Program and our intensified efforts in Child Nutrition Programs.

In the remainder of my remarks, I’d like to discuss in greater detail a few of the key proposals contained in the President’s fiscal year 2009 request.

Food Stamp Program

The Food Stamp Program is fully funded in the President’s budget at $43.3 billion. This will support an anticipated average monthly participation of 28.0 million persons. This record level of program participation is an increase of about 200,000 persons above expected activity in fiscal year 2008. While this increase in projected participation does, in part, reflect concerns about the future path of the economy, it also reflects the success of the Administration’s efforts in conjunction with our State and local partners to improve program access and reach out to historically underserved populations including low-income working families, the elderly and the Hispanic community.

Should our estimate of fiscal year 2009 program participation or cost prove to be inadequate, the program continues to be protected by a contingency reserve, proposed at $3 billion in new budget authority for fiscal year 2009. As an alternative to the contingency reserve, the President’s request offers a proposal of indefinite authority. This form of appropriation would eliminate the need for an annual contingency reserve appropriation, while at the same time guarantees that sufficient funds will be available to meett the entitlement components of the program.

Child Nutrition Programs

An increase of $554.3 million is requested for the Child Nutrition Programs including our three largest programs serving children: the National School Lunch Program, the School Breakfast Program, and Child and Adult Care Food Program. This increase will support the continuing growth in meal service in these programs with more than 9 billion appealing, nutritious meals provided to all of our children in schools and many childcare settings. Since fiscal year 2001, average daily participation in the National School Lunch Program has climbed from 27.4 million to an estimated 32.1 million in fiscal year 2009. In the School Breakfast Program, an estimated 11.2 million children will be served each day in fiscal year 2009, up from 7.8 million in fiscal year 2001.

These programs play an essential role in improving the nutrition of our children and in promoting their awareness of the role that healthy food choices and physical activity play in their overall well being. To ensure that these core program goals are met, support for the Child Nutrition Programs has grown by over 50 percent since fiscal year 2001, reflecting substantial growth in participation growth. We continually strive to ensure that these programs are delivered in a manner that promotes access for all eligible children, reflects the most up-to-date science-based nutritional practices, and protects the public investment.

WIC

In fiscal year 2009, the President’s budget request for the Special Supplemental Nutrition Program for Women, Infants and Children (WIC) of $6.1 billion anticipates providing essential support to a record monthly average of 8.6 million women, infants and children. This is an increase of approximately 100,000 participants per month from anticipated fiscal year 2008 participation levels. Within this appropriation request, the program contingency fund is replenished to the $150 million level. The contingency reserve, first proposed by this Administration in fiscal year 2003, recognizes the uncertainty the program faces with respect to future food costs and demand for program services. Additionally, the reserve grants the Secretary the authority to target resources to States experiencing difficulties rapidly and outside of the standard grant formula. This flexibility is essential to our ability to deal quickly and effectively with unexpected increases in food costs or participation as were experienced in fiscal year 2007.

Finally, the request includes $14.9 million to continue our peer counseling initiative that is designed to enhance both rates of initiation and duration of breastfeeding among WIC participants.

The fiscal year 2009 budget proposal continues our request to limit adjunctive eligibility based on participation in Medicaid to those individuals whose incomes are below 250 percent of Federal poverty guidelines. In all of the Federal nutrition assistance programs, the Administration is committed to ensuring that benefits are targeted to those most in need. WIC applicants can currently receive adjunctive or automatic eligibility for benefits based on their participation in other means-tested programs, such as the Food Stamp Program and Medicaid. However, in some States, individuals with incomes significantly above the 185 percent of poverty level established for participation in WIC are eligible for Medicaid. Again this year, we propose to limit this practice to those individuals whose incomes are below 250 percent of Federal poverty guidelines.

The budget also reflects the Administration’s commitment to work with its State partners to manage program costs to ensure future access to this critical program for all who are eligible and seek services. Historically, WIC State agencies have been extremely successful in containing food costs. To encourage State agencies to work with us to achieve similar success in the containment of Nutrition Services and Administrative (NSA) costs, the budget proposes that the funds available for NSA in fiscal year 2009 would be limited to a guaranteed administrative grant per participant (AGP) of $14.97, the fiscal year 2007 level. This reduced AGP level would encourage our State partners to strive for administrative efficiency and allow for a greater proportion of appropriated funds to be used for food benefits. It is estimated that the additional appropriation needed for FY 2009 would be $145 million in the absence of this proposal.

Commodity Supplemental Food Program (CSFP)

The President’s fiscal year 2009 budget request does not fund CSFP. We face difficult challenges and decisions with regard to discretionary budget resources and have chosen to not request funding for this program for several reasons. First, CSFP is not available in all States. It currently operates in limited areas of 32 States, two Indian reservations, and the District of Columbia. Second, its benefits, to a great extent, overlap those available through other nutrition assistance programs. Finally, we believe our limited resources are best focused on those programs that are universally available to serve these needy populations. The priority of the Administration is to ensure the continued integrity of the national nutrition assistance safety net, including the Food Stamp Program and WIC. However, we want to acknowledge our CSFP partners at the State and local level who have worked on behalf of this program.

FNS will work closely with CSFP State agencies to ensure that any negative effects on program participants are minimized, and that they are transitioned as rapidly as possible to other nutrition assistance programs for which they are eligible. The budget request includes funds to support the transition of CSFP participants to nationally available FNS nutrition assistance programs such as WIC and Food Stamp Program. The budget requests $2 million to provide outreach and to assist individuals to enroll in the Food Stamp Program. Elderly participants who are not already receiving food stamp benefits will be eligible to receive a transitional benefit worth $20 per month ending in the first month following enrollment in the Food Stamp Program under normal program rules, or 6 months, whichever occurs first. CSFP women, infants, and children participants who are eligible for WIC benefits will be referred to that program. Commodities obtained under agriculture support programs will be redistributed for use in other nutrition assistance programs, such as TEFAP.

The Emergency Food Assistance Program (TEFAP)

TEFAP plays a critical role in supporting the Nation’s food banks. This support takes the form of both commodities for distribution and administrative funding for States’ commodity storage and distribution costs. Much of this funding flows from the States to faith-based organizations, a cornerstone of the food bank community. The President’s budget requests the full authorized level of $140 million to support the purchase of commodities for TEFAP. Additional food resources become available through the donation of surplus commodities from USDA’s market support activities. State and local administrative costs, which support the food bank community, are funded at $49.5 million in the President’s request.

Nutrition Programs Administration

We are requesting $150.3 million in our Nutrition Programs Administration account, which reflects an increase of $8.7 million in our Federal administrative funding. This account supports Federal management and oversight of a portfolio of program resources totaling $64.1 billion and accounting for over 66 percent of the total USDA budget.

A key component of this year’s request is a $5.7 million increase to support the continuation of our program integrity and accountability efforts across all of the nutrition assistance programs. These resources would support up to 35 staff years dedicated to improving the efficiency, effectiveness and financial integrity of the Nation’s nutrition safety net. While I am very proud of our accomplishments in improving the management of our programs, maintaining those gains and achieving further improvements is a challenge. This request represents a small investment that will pay big dividends in our continuing efforts to make certain we get the right benefits to the right people.

The budget request also includes $2 million to support the efforts of CNPP. These resources will assist CNPP as it continues its government-wide leadership role in the 2010 Dietary Guidelines for Americans process. The USDA and the HHS, by law, must review and update the Dietary Guidelines for Americans at least every five years. The review process for the 2010 update is already under way in fiscal year 2008. Successful completion of these planning and implementation initiatives will promote the Federal Government’s goal of speaking with one voice regarding nutrition policy issues, and will promote USDA’s goal to improve the diets of Americans by providing sound, scientifically-based nutrition information.

The resources requested within this budget are essential to ensuring that FNCS can continue to successfully execute its basic program administration, oversight and fiscal stewardship duties. With just nominal increases for basic program administration in most years, FNCS has reduced its Federal staffing levels significantly over time. We have compensated for these changes by working smarter – re-examining our business processes, realigning our organizational structure, building strong partnerships with the State and local entities that administer our programs, and taking advantage of technological innovations. I am extremely proud of what we have accomplished and continue to seek new ways to meet the challenges before us.

Madam Chairwoman, I appreciate the opportunity to present to you this budget request. I would be happy to answer any questions you may have.
 

Last modified: 11/26/2008