Re Docket Number: TMD-94-00-2

Dear Ms. Stommes:

These comments are submitted on behalf of Farm Verified Organic, a national and international certification service provider based in Medina, North Dakota.

Basic Purposes of the Organic Food Production Act

Major changes are needed in many sections of the proposed rule. In addition, some key additions are needed for the rule to embody the principles and procedures we feel are minimally essential in assuring the integrity of the National Organic Program (NOP), and in winning and sustaining the confidence of consumers. This goal - earning and keeping consumer confidence - must be the NOP's overriding goal. Indeed, everyone involved in the organic farming community, from growers and certifiers to processors, retailers, chefs and restaurateurs, shares a common purpose -- providing consumers a meaningful choice in the marketplace.

Those advocating passage of the "Organic Food Production Act" in 1988-1990 went to Washington seeking minimal involvement on the part of the federal government in the ongoing activities and functions of the organic food industry. The purpose of the act was three-fold --

* First, setting a consistent, minimum national standard that anyone wanting to use the organic label would have to meet. This was needed, first and foremost, to enhance consumer confidence. A minimum standard was also needed in order to help overcome problems of reciprocity across certifiers -- a major problem raising the costs of food manufacturers producing multi-ingredient organic canned, frozen, baked, dried, or other processed food products. Such standards also would help foster confidence in U.S. grown and certified organic food products moving into international markets.

* Second, the establishment of a credible accreditation scheme to review the procedures, professionalism, and record-keeping/audit trails of organizations and government agencies offering certification services. The hope was that the accreditation system would be based on a "peer review/tenure" type approach as used by educational institutions. It would evaluate all certifiers to make certain that they followed reliable certification procedures that consumers could depend on. * Third, enforcement mechanisms were needed to assure compliance with the legal standards and requirements set forth in the Act, as well as in the more detailed operational manuals of certifiers.

The key Senate Committee Report accompanying the legislation states that the "organic industry, as well as consumer and environmental advocacy organizations" wanted to "limit severely the Federal Government's discretionary authority and involvement in this industry . . ." The Report acknowledged that the organic industry had argued that "rather than reinvent the wheel" the government "should take advantage of the network of private organic certification organizations that exist in nearly every state." The Report indicated that Congress agreed with this sentiment and therefore -

		"proposed a partnership between government and private organizations

		in standard setting and certification."  (Report # 101-357, p. 291)  

Toward this end, we strongly urge the Department to re-propose the rule before going to a final rule, or to an interim rule. While we are hopeful that the Department will effectively resolve many of the problems with this proposed rule, we worry that some provisions will remain unresolved, or might be only partially resolved. Other provisions might be changed in such a way as to create other, new problems. For this reason, we urge the USDA to offer the public a second chance to comment on the re-proposed rule. A thirty day comment period might suffice for this round of review, but in the end, will accelerate progress toward final closure.

We feel that the lengthy Preamble section in the proposed rule serves little purpose. We advise the Department to reduce its scope to no more than 6 pages in the Federal Register, with most of the narrative summarizing process. The Department's detailed accounting of comments received, responses to comments, and logical for acting upon some and not others should be presented in an Appendix or separate document.

We also are both surprised and concerned to learn that some people in USDA apparently feel it is necessary for the NOP to develop detailed operational manuals to implement the OFPA. The USDA should NOT take on the virtually impossible task of synthesizing the detailed operational manuals and guidelines each certifying agent has developed over several years, drawing on its unique experiences and expertise. The task is not possible nor would it serve any useful purpose. We request that the Preamble to the final rule state clearly that USDA has no intention of developing field manuals or operational guides.

In the event additions, deletions or clarifications are needed in the final rule, for example, if a new law is passed, USDA should propose such changes using routine administrative processes. Circumstances might arise where the National Organic Standards Board (NOSB) believes that further guidance is needed in a particular area, to assist certifies apply the final rule as promulgated. When such instances arise, the NOSB should be responsible for developing such guidance documents, and in the course of doing so, should be assisted as needed and appropriate by the USDA and/or outside experts.

I. Additional Provisions Needed

We feel that a new "Principles" section should be added in Part 205, Subpart A, which should be revised to read -

"PART 205 - NATIONAL ORGANIC PROGRAM

Subpart A - Principles and Definitions

&205.1 Principles Guiding the Design and Operation of Organic Farming and Food Processing Systems

     1. Ecological Principle Organic farming and food processing systems should, to the full extent possible, take advantage of and augment natural systems and interactions among organisms. Dual goals should guide farm management decision-making: producing high quality, safe food in a manner that tends to preserve the integrity and stability of biotic communities, and builds or at least sustains, the inherent productive capacity of the soil, water and biological resources used in the production process.

Organic processing should, to the full extent possible, retain the integrity of raw agricultural products as harvested, at each subsequent step of processing and packaging for sale to consumers.

Any deviation from this ideal, in production or processing, should only be allowed when there is clearly demonstrated need. Exemptions must also not undermine the long-term goals of building soil productivity and producing nutritious, safe food that consumers can buy and enjoy with confidence.

Furthermore, this principle should apply to all deviations and exemptions, be they sought because of an emerging or known production or processing problem, or in cases of unknowing and/or unavoidable deviations.

     2. Precautionarv Principle. Any materials or technologies used in the production or processing of organic food must be proven safe. The burden of proof shall always be on the party wishing to use and/or gain approval for a material or technology, and contending it is safe and consistent with organic farming principles.

     3. Bio-Svstems Principle. The acceptability of practices, processes and inputs in organic farming and food processing should be judged, first, in terms of their impacts on whole organisms and the biological and ecological processes that govern interactions within living systems. Those that are found to contribute to the health of organisms and long-term productivity of systems should then be evaluated in terms of their intrinsic properties and safety, independent of their use and impacts on living systems.

     4. Encourage Diversity and Reward Quality Results. On the farm, in the processing sector, and in all aspects of implementation, the focus should be on identifying and encouraging innovation and quality outcomes rather than compliance with process or established norms.

     5. Perpetual Improvement Principle. To the full extent possible, the continued improvement of the organic craft should be encouraged, recognized and rewarded, both among producers and processors of organic food.

     6. Equitable Fees Principle. Necessary costs imposed on growers, processors, the trade or taxpayers should, as a basic goal, be shared equitably and in relation to the benefits received from the costs imposed. In general, farmers and the organic industry should bear the costs of certification. USDA, working with public funds, should bear the administrative costs of the accreditation process since it is the general public which benefits from continual improvement in the integrity of certification. On an ongoing basis, USDA should also collect and share data, and carry out and/or commission independent analyses helpful in documenting the magnitude of direct and indirect costs and benefits associated with OFPA implementation, for the purpose of making any adjustments in fee rates and schedules needed to comply with this principle."

[No further changes, except corresponding changes in numbering of subsections].

II. Specific Issues on Which USDA Seeks Comment

We offer several comments on issues the Department seeks comments on. Page references are to the Federal Register, Vol. 62, No. 241, where the proposed rule is published in its entirety.

Page 65852, "Proposed Effective Date of the Regulation"

Because of the potential for mislabeled organic produce to enter market channels, undermining consumer confidence in organic foods, we urge USDA to make all provisions of the rule effective upon publication of the final rule, allowing for reasonable phase in periods for those aspects of the rule that can not be accomplished immediately, including --

 			Changes in the list of allowed or prohibited substances such that food

			products previously certified as organic can be marketed.



 			Ample time, not to exceed 18 months, for certifying agents to submit

			applications for accreditation and for the USDA to act upon the

			applications (see further comments below).

Drawing on the extensive experience of Farm Verified Organic, we are certain that the proposed Preamble language markedly underestimates the future costs to the organic industry of assuring compliance with provisions governing allowable levels of pesticide residues. We think these provisions are important and belong in the rule, with chnages noted below, but also believe it important for USDA to more accurately project the added costs that residue testing will impose on growers, certifiers, and consumers.

Contemporary costs are low because there is relatively little residue testing being done as a routine part of organic inspections and certification. Future costs are bound to rise when residue testing becomes a mandatory part of certification, especially for small and mid-size growers not already carrying out systematic residue tests as part of Quality Control progams.

Consumers expect organic food to be free of pesticide residues. The industry must work hard to assure there is no slippage in this critical, highly visible performance indicator. Steps are needed to assure food is free of residues when it leaves the farm, and remains free until it reaches the consumer.

Food moves through several steps before reaching the consumer and contamination with pesticides can occur at any point along the food processing-delivery chain. Testing must therefor be carried out periodically at different stages in the process, as must attention to sound pest management principles.

We also remain concerned that the rule will tolerate continued, significant use of pesticides on food grown and processed overseas and imported into the U.S. that is labeled and sold as organic. USDA must assure that the rule results in a "level playing field" in order to not place U.S. organic farmers and food processors at a competitive disadvantage, and in order to avoid erosion in consumer confidence when imported organic food is tested and found to contain synthetic pesticide residues. Experience with past food safety crises confirms that consumer confidence can be quickly undermined if unscrupulous operators strive to earn organic market premiums by fraudulently labeling conventional food as organic. Accordingly, any mislabeling episodes must trigger decisive, public interventions by USDA, drawing on the enforcement authority set forth in the OFPA and other applicable laws.

Page 65875, "Selection and Use of Seeds, Seedlings and Planting Stock" -- Section 205.8 - "Use of Genetically Engineered Organisms (GEOs)"

The final rule should not allow for the use of GEOs in organic farming and food processing. Consumes seek out certified organic food because it represents to them added value. This added value is derived, or stems from the way food is grown on farms where the principal focus of managers is working with natural cycles and ecological interactions in ways that sustain soil fertility and health, and manage pests through biointensive Integrated Pest Management (IPM). Many consumers have come to appreciate that organic farming systems are significantly distinct from conventional agriculture and pose less hazards to the environment, other organisms, consumers, and especially, people working on or living near farms.

The prohibition of use of synthetic production inputs on organic farms is among the core values of organic agriculture. This prohibition has attracted the interest and support of many consumers. To preserve this critical distinction and core value of organic farming and food processing, we concur with the NOSB recommendation to not allow the use of genetically engineered organisms in the production or processing of food certified as organic. We also feel the rule needs to be more precise in defining what is encompassed by the term "genetically engineered organisms."

In the years ahead, the NOSB will need to devote some time and effort to issuing clear definitions and criteria to distinguish between routinely prohibited applications of biotechnology, in contrast to those that NOSB might permit when proven safe and consistent with the other basic principles set forth in Section 205.1.

Accordingly, the final rule should clearly state that, in general, GEOs are not permitted for use in organic farming and processing during a five-year period. During this time, the NOSB and USDA should establish a process to review and address those current applications of biotechnology that are now, in some circumstances, hard for organic food manufacturers to assuredly avoid.

Page 65881, "Livestock Health Care -- Section 205.14," Allowed Uses of Antibiotics

Just as soil health can be restored through proper management, so too can the health of a production animal ( a producing dairy cow, for example). Antibiotic use should be allowed in limited circumstances when needed to treat local infection from injury, or assist an animal in recovering from an infectious disease or other illness. In no circumstances should antibiotics be used prophylactically or as a growth promoter. Suggested changes in language in the next section are based on the June 4, 1994 recommendations of the NOSB on the use of antibiotics. Under no circumstances should slaughter animals, requiring antibiotics any time during the life of the animal, be labelled organic.

Page 65893, "General Rules for Categories of Substances and Ingredients Permitted for Use in Organic Farming and Handling," Section 205.20 - Use of sewage Sludge.

Use of sewage sludge on organic farms should be prohibited. Such use is fundamentally incompatible with the goal of building consumer trust in organic food products. Significant health risks - and consumer concerns -- will surely arise if sewage sludge is used on land used for growing crops or the grazing of livestock. Even if the best available technology is used to manage pathogen and heavy metal content in sludge, evidence shows clearly that the application of sludge to cropland will expose some consumers to unhealthy levels of heavy metals and in some circumstances, disease causing pathogens. Moreover, sewage sludge invariably will contain contaminates not otherwise permitted for use on organic farms or processing, and hence would undermine consumer confidence in the purity of organic food.

Page 65897, "Labels, Labeling, and Market Information," -- Is the Seal of a Certifier Information Appropriate for the Principal Display Panel?

We disagree with the Preamble and believe strongly that many consumers are interested in who certifies a product. Accordingly, we recommend that the rules allow a company or farm-marketer to place a certifier's seal on the principal display panel of a package. There are many reasons why consumers may wish to know who certified a product, and they surely have a right to know such information.

Many consumers want to support farm and food processing operations that are based nearby, or in a certain region or state. The same preference may extend to certifiers, some of whom are state-based or operate under state law. Some states and local jurisdictions have passed laws or ordinances which provide greater clarity to the rules governing organic production and certification. Other states and local jurisdictions have or may soon pass laws which stipulate additional social benefits that can be achieved through expansion of organic farming and processing activities Some consumers may wish to support attainment of such additional goals, particularly those that are of local or regional significance.

Over the years through participation in public events and wide-ranging consumer education efforts, some certifiers have gained considerable visibility and trust among consumers in particular parts of the country, or in certain foreign markets. The seals of some certifiers have attained brand equity value in particular markets because they are recognized and trusted, and associated with consistent, high quality. There is no reason for this rule to erode that brand equity. Indeed, the rule should reward it, and in doing so, motivate other certifiers to work harder to gain such recognition and trust. In this way the rule and NOP can steadily elevate the professionalism and thoroughness of certification activities across the industry.

The approaches, philosophy, program objectives and rigor of certifying agents differ markedly. In order to keep costs to a minimum, some emphasize expediency in meeting minimal standards as set forth in state law, their bylaws, or by international organizations. Others aspire toward goals in addition to assuring compliance with organic farming methods and minimal standards. For example, Farm Verified Organic (FVO) uses the process of drafting a farm plan, annual inspections, and reviews of certification status to collectively explore, and hopefully resolve, common production, resource conservation and pest management challenges. As a core principle of FVO, we use the certification process as a way to foster networking among organic farmers, consultants, researchers and others working to develop and apply biointensive farming methods. This FVO commitment takes more time and effort on everyone's part, and only some growers feel it is worthwhile to them.

We strongly support the right of farmers to choose among certifiers, and the right of certifiers to compete on the basis of the breath, quality, and cost of the services rendered. Some certifiers have a special relationship with certain CSAs (Community Supported Agriculture) or certain retail outlets or restaurants. Some consumers may wish to purchase food products carrying the seal of a particular certifier in order to support such additional activities, or to reward the certifier for constructive contributions to a given community or education effort. For consumers to be able to act on such preferences, certifier seals should, when desired, be allowed to appear on a product's principal display panel, in advertising, or other point-of-purchase information.

In addition, it is likely that in the future some certifiers will fail to attain accreditation. Others will lose it because of lapses in procedure, fraud, conflicts of interest or other problems. Media coverage of such episodes could be extensive, and might needlessly raise questions among consumers about all certifiers. The best way to insulate innocent growers, food companies and certifiers from bad press and slippage in consumer confidence is to allow certifiers' seals to appear on the principal display panel and in other marketing and educational materials.

We agree with the need to also feature the USDA seal on the display panel. We would accept a provision stating that a certifier's seal or other mark may be included on a principal display panel, at the discretion of the marketer, and that the certifier's seal or mark shall be no more than twice the size of the USDA seal, as it appears on the principal display panel.

Page 65897-65898, "Agricultural Products in Packages Sold," -- Use of the Term "Organic" on the Principal Display Panel

We have serious concerns about the proposed labeling provisions. In Part II of our comments, we offer several recommended changes in the language in "Subpart C -- Labels, Labeling and Market Information."

Labeling must be consumer-friendly, easy to interpret, and accurate. It should convey the information about a product that consumers are most likely to be interested in as they make their purchase decisions. In addition, labeling provisions need to be specific, clear and enforceable in order to assure a level playing field across manufacturers, retail outlets and other parts of the distribution chain, and between U.S. based producers and companies and those growing food abroad and exporting it to the U.S.

Last, the final rule should allow manufacturers and retailers ample freedom to explore alternative ways to convey information on labels in ways which will catch the interest of consumers, while also assuring label information is accurate and not misleading.

Toward this end, several changes will be needed in the final rule.

First, the proposed USDA seal must be redesigned. The design's most distinctive design feature - the triangular background -- is inappropriate, misleading, and damaging to the basic objectives of the OFPA and organic community. Organic agriculture rests upon cycles and ecological interactions, basic themes that have nothing to do with the symmetry and sharpness of the angles in a triangle. Moreover, triangle designs are used in several warning signs to convey hazard or the need for caution. We call upon USDA to place the NOSB in charge of a process leading to the development of a new seal and rules governing its use on labels, advertising, and point-of-purchase information.

A key labeling challenge is helping consumers distinguish between products containing 95 percent or more organic ingredients by weight, excluding water and salt, and those with between 50 percent and 95 percent, or under 50 percent. The final rule must provide much clearer incentives for continual improvement toward 100 percent organic ingredients.

It should reward those growers and manufacturers who invest in creating new sources of supply for previously hard-to-find certified organic ingredients. The only way to achieve these goals is to make sure there are clear and easy to recognize distinctions on labels as a function of their organic content. Accordingly, we recommend language that --

 			Allows use of the term "organic" in the principal display panel

			only on products with 95 percent or more organic content;



 			Permits products with 99.5 percent or more organic content to be

			clearly identified by use of one of three alternative design elements

			that a manufacturer can choose from -- use of a gold background for

			the redesigned USDA seal, use of a gold background for the certifiers

			mark, or use of a gold background or shading where the term "organic"

			appears in the principal display panel;



 			Permits the term "Contains Organic [specific ingredient(s)]" or "Made

			from organic [ingredient(s)]" to appear on the label, but not in the

			principal display panel, in type no larger than one-half the size of

			the type used in the principal display panel, as long as two conditions

			are met:



    		I.	Each of the ingredients so identified make up at least 15 percent of

			the product by weight excluding salt and water; and



    		II.	All ingredients that are certified organic together make up at least

			50 percent of the product by weight excluding salt and water (which could

			include ingredient(s) that do not appear in the label statement because

			they do not constitute 15 percent or more of the product weight). 

Once the final rule is promulgated, both USDA and the organic trade will need to carry out a coordinated and sustained grower, processor, retailer, and consumer education campaign to help producers, manufacturers, marketers, and consumers read and interpret the graphic images and content of organic food product labels. Simple and uniform provisions governing the use of the term "organic," and the content and graphic look of the principal display and ingredients list panels must give consumers a clear and simple way to quickly distinguish between products with varying levels of organic content.

Pesticide Residue Testing

Page 65931, "Compliance Review and Other Testing," Sections 205.430 through 205.433 -- Provisions Governing Pesticide Residues in Organic Foods

Most consumers expect organic foods to be free of synthetic pesticide residues. The law appropriately requires certifying agents to have a pesticide residue testing program as part of their compliance and enforcement protocols. Furthermore, in certain narrow and defined circumstances, the law allows for food certified as organic to contain low levels of prohibited residues. These might include residues resulting from drift, a government-mandated aerial spray program, or persistent residues in soil or irrigation water.

Our experience, and the results of the December 1997 Consumers Union testing of produce labeled as organic, suggests the need for changes in the rule as proposed. First, the final rule must more definitively and carefully specify how certifiers, or other responsible parties, are to determine the level of pesticide residue deemed "acceptable" on certified organic produce, assuming an investigation confirms that the source was something other than a prohibited application.

Definition of Detectable      The proposed rule defines 5 percent of the EPA tolerance level as the "detectable residue level" for purposes of compliance testing and enforcement. This is inaccurate and unscientific. While this may have been accurate at the time the law was written, for virtually all pesticides used today, the detectable level is much lower than 5 percent of the EPA tolerance.

A "detectable" residue level is the lowest level that can be reliably identified using state-of-the-art sampling and analytical chemistry techniques. Since analytical chemists can almost indefinitely enhance the sensitivity of analytical methods as long as time and cost are not constraints, there is a need for a practical lower-bound below which certifiers, and the analytical laboratories they work with, do not need to go below. We suggest that such a level be set at 0.01 ppm in the final rule, or in the event of tolerances above 10 ppm, one-thousandth (0.001) of the current published tolerance levels (i.e., for a tolerance of 20 ppm, the level of sensitivity would need to be 0.02 ppm). The only exceptions would be cases where the USDA and/or EPA determines that such a level of residue poses more than a "deminimus risk."

Basis for Setting "Acceptable" Residue Levels       The majority of pesticide residues found on conventional food grown in the United States are at levels well below 5 percent of the published EPA tolerance level. Despite this well known fact, such levels of residues cannot always be defended as "safe." Because of heightened concern over endocrine disrupting pesticides in the food supply and the risks facing infants, children, and pregnant women, the Congress passed the "Food Quality Protection Act" (FQPA) in the summer of 1996, setting in motion a re-evaluation of over 9,000 published tolerances, many of which will be lowered markedly or revoked.

Hence, it is inappropriate and misleading to use existing tolerances as the basis for establishing "acceptable" levels since EPA has acknowledged that many tolerances were set years ago without consideration of potential adverse effects on human health, especially vulnerable segments of the population. Until such time as a tolerance is adjusted by EPA to meet the "reasonable certainty of no harm" standard in the FQPA, "acceptable" levels of residues from inadvertent sources should be limited to 0.01 (one one-hundredth) of the current EPA tolerance.

The health standard adopted by the NOP for application in setting "acceptable" pesticide residue levels in organic food should be substantially stricter than the FQPA imposes on conventional foods. We think the level should be at least 10-fold more stringent. Since the FQPA also requires EPA to apply an additional 10-fold safety factor to protect pregnant women, infants and children, the USDA should set "acceptable" residues at no less than one-one hundredth of existing tolerances, and no less than one-tenth of tolerances once they are set and/or adjusted in full compliance with the FQPA's standard.

It is essential that the final rule not include confusing and unscientific uses of the term "detectable" and the term "acceptable." "Acceptable" levels of residues in organic foods should be defined conservatively, and in reference to levels called for in the FQPA. "Detectable" residues are a function of analytical chemistry techniques, not policy judgements.

Such changes in the pesticide residue provisions of the proposed rule are needed to protect U.S. consumers and U.S. based organic farmers from the import food products that are labeled organic, but which contain pesticide residue at levels well in excess of most conventional sources of food grown in the U.S. In addition, more attention must be given to the pesticide residue-related provisions governing the determination of "equivalency" in an international certification program. If the proposed language stands, organic farmers and handling operations abroad will have a distinct and in some cases significant advantage compared to U.S. operations. As a result, U.S. consumers will be exposed to higher levels of pesticide residues in some imported foods labeled and represented as organic than they would be as a result of choosing conventional sources of the same food products grown and processed in the U.S. Such an outcome is clearly unacceptable and would quickly undermine consumer confidence in the program and organic food..

Frequency of Testing       The proposed rule calls for a certifier to test a certified farm or handling operation "not less frequently than every 5 years." We feel this requirement is a minimally acceptable foundation from which to assure consumers that organic foods are free of pesticide residues, but only under certain circumstances. Testing every five years should be deemed acceptable with growers and regions with a stable, consistent record of clean food. In areas or on farms where residues have been found in the recent past, certifiers should sample food as often as quarterly. As more tests produce negative results, the number of months between tests can be steadily increased, until it again reaches five years.

Requiring tests more frequently where residues have been found will serve two useful purposes. It will allow food with residues to be moved out of organic marketing channels. It will also provide significant incentives for growers and certifiers to identify the source of residues, and eliminate the source. It will also help assure a level playing field among those seeking access to the U.S. market.

Pesticide residue testing is one essential component in making such assurances, but should not be relied upon exclusively. We therefor recommend several changes in the provisions governing compliance with residue testing and monitoring requirements. There should be a sliding scale for the frequency of testing based on annual sales of the operation, and an adjustment for past performance and the quality of evidence supporting the lack of pesticide residues.

 		The base frequency would be set as a function of annual sales of the

		operation: one sampling and series of tests* (footnote: A "series of

		tests" would encompass the testing of a sample of food for different

		pesticide residues using more than one analytical method, each capable of

		detecting different active ingredients and families of chemistry) for each

		$100,000.00 in gross 	value of a given commodity sold by a farm operation

		or a food manufacturer in a five year period (i.e., an acceptable residue

		test confirming the absence of residues in tomatoes at harvest would have

		to be carried out five times over five years on a farm selling $550,000.00

		in organic tomatoes in a five year period).



 		An adjustment in frequency would be allowed for past performance  and the

		quality of evidence supporting the lack of pesticide residues.  Certifiers

		would be allowed to adjust the base frequency for testing as a function of

		past findings of residues, the extent and quality of data on residue levels,

		and the availability of other sources of residue data from other segments

		in the production, processing, and distribution chain. For farms and

		handling operations with an exemplary record and solid data supporting

		the absence of residues, the base frequency may be adjusted to once every

		five years regardless of size of operation. For farms and operations where

		residues have been found within the last five years, the frequency of

		testing shall be increased to not less than one sample and series of tests

		for each $30,000.00 in sales of a single commodity in a given year. After

		three samples with no detectable residues, the frequency may be reduced,

		at the discretion of the certifier. 

In meeting the requirement for residue monitoring, certifiers may rely on pesticide residue data provided to them by growers, food processors, handling operations or retailers as long as the residue data has been collected and reported in compliance with standard sampling and residue chemistry procedures as set forth by FDA and USDA, and a clear audit trail can be established from the selection of the sample in the field to the reporting of results by an accredited analytical laboratory.

II. Recommended Changes in the Language of the Rule as Proposed

Several changes are essential in Part 205, Subpart A, in the definitions of terms.

Made With Certain Organic Ingredients

The proposed definition of "Made with Certain Organic Ingredients" does not belong as a definition and should be deleted. Circumstances and rules governing the use of this or similar phrases on organic food products containing less than 95 percent organic ingredients by weight excluding salt and water should be addressed in Subpart C.

Soil Quality

The proposed definition of soil quality reads: "Observable indicators of the physical, chemical or biological condition of soil." As currently stated, the definition fails to encompass the functional attributes of soils that give rise to steady improvement in the productivity of farming systems and the relationship of agriculture production to environmental quality. For this reason the definition must be revised. Efforts to steadily improve "soil quality" are integral to all organic farming systems and form a major component, and focus, of organic farm plans. Both the scope and effort invested in steps to improve soil quality are among the definitive distinctions between organic and conventional farming systems. In addition, progress in improving soil quality invariably improves the relationship between farming operations and environmental quality, and hence are of broad social consequence.

Accordingly, the following definition of "Soil Quality" should be included in the final rule. This definition is derived from the discussion of "soil quality" in the 1993 National Academy of Sciences report Soil and Water Quality: An Agenda for Agriculture :

 			"Soil Quality -- Within organic farming systems, the capacity of

		soil to:

 

 		   	(1)Support healthy root growth and function, and vigorous plant	growth;

			(2)Take in and hold moisture to meet crop needs, and to protect

		watersheds by regulating infiltration and providing a buffer against

		contaminants;

			(3)Cycle and retain nutrients within the soil profile; and, 

			(4)Suppress weed, insect and plant diseases and damage, or

		otherwise assist plants or animals withstand a degree of pest pressure

		without sustaining economically significant losses."

System of Organic Farming and Handling

In order to reflect the new principles added in Subpart A, &205.1, the proposed definition should be modified to read --

		"System of Organic Farming and Handling.    A system that is designed to

 	produce and process agricultural products through the use of methods,

 	technologies, and substances consistent with the principles of organic farming

 	and which maintain the integrity of organic products throughout the production-

 	processing-distribution chain.  Such systems and processes are based upon

 	integration of several genetic, biological, cultural and mechanical practices,

 	methods, technologies, and inputs to fulfill necessary functions, like meeting a

 	crop's or an animal's nutritional needs.  In addition, such systems are designed

 	and managed to reinforce natural feed-back mechanisms and processes that:

 

 		Support healthy root system and plant growth; 

 		Enhance the ability of plants and animals to withstand, reduce or

		otherwise overcome pest and disease pressure without reliance on

		pesticides or animal drugs; 

 		Steadily improve soil quality and livestock health; and

 		Avoid the need for exogenous synthetic additives or processing."

B. Subpart B -- Organic Crop and Livestock Production and Handling Requirements

Section 205.7 -- "Soil fertility and crop nutrient management," subpart (a) should be revised to read:

			"(a) Tillage and cultivation. Tillage and cultivation

		implements and practices shall be selected and used in a manner that,

		in conjunction with other farming practices and system components

		improves soil quality from the beginning of one crop rotational cycle

		to the next."

Section 205.7 -- "Soil fertility and crop nutrient management," subpart (d) should be revised to read:

			"(d) Prohibited. The following methods or substances are prohibited

		for use in soil fertility and crop nutrient management, or for any other

		purposes within an organic farming system:

			(1) …no change…

			(2)The use of ash or any byproduct of the burning of animal manure,

		dead livestock, or wastes from livestock slaughter, processing or

		rendering facilities, whether derived from and burnt on the farm on

		which the ash or byproduct is applied, or from sources off the farm.

			(3) …no change….

			(4)Biosolids or any product derived from or containing human sewage

		 sludge in any form, unless specifically reviewed and approved by the NOSB.

			(5)Any product that includes or is derived from animal blood, bones,

		brain, feathers or nervous system tissues, unless specifically reviewed

		and approved by the NOSB.

Section 205.9 -- "Prevention and control of crop pests, weeds, and diseases," Subpart (a), Number (4), should be revised to read:

			"(4) Cultural practices that enhance biodiversity, soil quality,

		root and crop health, including selection of plant species and varieties

		with regard to suitability to site-specific conditions and resistance

		to prevalent pests, weeds and diseases and steps to attract and preserve

		populations of beneficial organisms."

			"(1) Augmentation or introduction of predators, parasites,

		parasitoids, or other organisms that attack pests directly, compete

		with them for habitat or food sources, emit substances that help

		control pest populations, or otherwise contribute to biological or

		other natural pest control or plant health processes; 

			"(f) Prohibited. The following substances and/or methods of pest

		management shall not be permitted in organic crop production:

			(1)A synthetic substance that functions through a cytotoxic mode

		of action, other than substances specifically allowed through placement

		on the National List by the NOSB; and

			(2)Plants bred to express bacteria or other toxins in tissues at

		lethal levels."

Section 205.12 -"Origin of livestock," Subparts (a) and (b) should be revised to read:

			"(a) Origins of livestock.. Slaughter stock are those animals on a

		farm raised for meat.  Production stock are animals raised and managed

		principally for the production of milk, eggs, fiber, or other products

		other than meat.  Both slaughter stock and production stock must be raised

		under organic management from birth or hatching, or shall be the offspring

		of parents who have been under organic management in order for meat or

		products from such animals to be sold, labeled or represented as organic,

		except that:

			(1) Breeder stock.  Livestock may be designated as breeder stock for

	 	offspring that are raised as organic livestock upon entry onto a 

		certified  facility, Provided That, if such livestock is a gestating

		mammal she must be brought onto the certified facility prior to the

		last third of pregnancy;

			(2) Dairy livestock.  Livestock may be designated as organic dairy

		livestock from which milk or milk products obtained therefrom can be

		sold, labeled or represented as organically produced, Provided That

		she is brought onto a certified facility beginning no later than 12

		months prior to the production of the milk or milk products that are

		to be sold, labeled or represented as organic;

			(3) Poultry.  Poultry may be designated as organic poultry from which 

		meat or eggs obtained therefrom can be sold, labeled or represented as 

		organically produced, Provided That they are brought onto a certified

		facility beginning no later than the second day of life.

			(4) …no change through the passage "Provided, Further That" which

		should read: Provided, Further That any livestock not raised under organic

		management from birth or hatching shall have been under organic management

		no less than 12 months prior to harvest of the non-edible product intended

		to be sold, labeled or represented as organic."

			(5) Delete subparts (ii) and (iii).

			(b) Prohibited.  The following practices are prohibited:

			(1) and (2), …no change…

			(3) The use of embryo transfer and cloning technologies;

			(4) The use of genetically engineered species or breeds.

			"(a) Feeding of livestock.. (1)  Agricultural products, including

		pasture and forage, that are organically produced and, if applicable,

		organically handled in accordance with the Act and the regulations in

		subpart B of this part shall comprise the total feed ration of production

		livestock under organic management, Provided, However, That

		if necessary:

 			(i) Livestock, other than as provided for in paragraphs (a)(1)(ii)

		through (iv) of this section, may receive a maximum of 10 percent of

		the total feed ration in a given year that is not organically produced.

		All slaughter livestock must be fed 100 percent organically produced feed;

			(ii) Delete and renumber following sections appropriately.

			(iii) Milk cows may be purchased and fed 100 percent organic feeds 90

		days prior to lactation and their milk may be sold, labeled and

		represented as organic, Provided, That production from such cows

		represents less than 5 percent of the certified milk production from a

		farm operation; and

			(iv) and (2) …no change…

			(b) Prohibited. The following substances or methods for the

		feeding of livestock are prohibited:

			(1) The use of hormones or growth promoters whether implanted, injected,

		or administered orally;   

			(2) Synthetic amino acid additives or synthetic trace elements fed above

		levels needed for adequate nutrition; 

			(3) Antibiotics or other animal drugs;

			(4) Genetically modified organisms or products thereof, except as

		provided for in Section 205.21; 

			(5) Nonorganic milk replacer for calves;

			(6) Larvacides, and

			(7) Solvent extracted meal."

			(b) and (c) deleted, insert NOSB recommendation with regard to

		antibiotics adopted June 4, 1994.

			(d) Prohibited. The following livestock health care methods are prohibited:

			(1) Administering any animal drug, other than vaccinations, in the

		absence of illness;

			(2) The use of synthetic parasiticides;

			(3) The subtherapeutic use of antibiotics;

			(4) Therapeutic use of antibiotics are not allowed except as provided

		for in Section 205.14 (4) (b); and

			(5) In bee culture, antibiotics, fumigants, miticides, chemical

		repellants and sugar feeding."

			"(a) The following living conditions shall be adequately provided, as

		appropriate to the species, to promote livestock health:

			(1) Protection from the elements; 

			(2) Space for movement;

			(3) Clean and dry living conditions;

			(4) Access to outside; and

			(5) Access to food and clean water.



			Insert new (b) Prohibited.

			(1)the use of cages for poultry

			(2) facilities that do not allow animals access to grass, bedding and

		dirt



			(b) Temporary indoor housing may be justified for inclement weather,

		health care, safety, and well being of livestock; and protection of soil

		and water quality, Provided, That the other living conditions specified in

		paragraph (a) of this section are adequate to maintain their health without

		the use of animal drugs, except as provided in _ 205.14(b).

			(c) Manure management practices used to maintain any area in which livestock

		are housed, pastured or penned where manure is stored and disposed shall be

		implemented in a manner that:

			(1) Does not result in degradation of soil quality;

			(2) Does not contribute to contamination of water by nitrates and

		bacteria, including human pathogens;

			(3) Optimizes recycling of nutrients; and

			(4) Does not include burning or any practice inconsistent with the

		provisions of Section 205.14(a)(2).

			(d) Under no circumstances may an organic farm operation use or allow:

			(1) Earth-based manure cesspools; or

			(2) Manure accumulation in excess of the ability to dispose of it in

		accordance with the requirements in Section 205.15 (c)."

We are deeply concerned that the provisions governing what can appear on organic product labels will reward creative marketeering and result in confusion among consumers regarding the degree to which a product contains organically produced and processed food. Accordingly, we suggest several key refinement in the proposed rule.

Section 205.16 -- "Product composition," Subpart (a) and (b), should be revised to read:

			"(a) For an agricultural product, including a raw agricultural product,

		to be sold, labeled, or represented as organic in the principal display

		panel and other labeling and marketing information:

			…no change…

			…no change…

			(b) In the case of an agricultural product containing less than 95

		percent but more than 50 percent organic ingredients by weight excluding

		salt and water, the term "organic" may not appear in the principal display

		panel, but may appear elsewhere on the label in a type face no greater

		than two-thirds the size of the most prominent type used in the principal

		display panel, Provided, That the percentage of the total weight of the

		finished product, excluding salt and water, that is not comprised of

		organically produced agricultural products shall consist of one or more

		of the following ingredients:

			…no change…

			…no change… 

			…no change…

In the proposed rule the USDA seeks guidance on whether genetically engineered organisms should be allowed in organic farming and food handling operations. Based on the current set of agricultural GEO technologies moving into commercial use, especially Bt-transgenic crop varieties and herbicide tolerant plants, the answer is easy and unequivocal -- NO!

However, some genetic engineering technologies exist that may have limited use and others may evolve. The use of GE technologies as diagnostic tools to assist in determining disease, for example, are analogous to the use of synthetic phermone traps. Other such uses that do not require the use or release of a GEO into a farming system, or the use of a GEO in food processing may exist or evolve. It may be that such such applications should not fall under the rule nor require assessment by the NOSB, nor should they be generally regarded by farmers or consumers as incompatible with the principles of organic farming. For this reason, we believe the final rule would benefit from a more explicit discussion of those applications of biotechnology which are not compatible with the principles of organic farming and food processing, in contrast to those applications which might be acceptable. We recommend that the NOSB empower a interdisciplinary GEO science panel to explore this issue and provide it with a report to guide its work in this important area.

We also believe that the USDA's position of using "risk" as the basis for judging the applicability of GEO's is inappropriate for organic farming and handling systems. Organic systems depend on healthy, balanced ecological interactions, and the scientific community still does not have the expertise to determine the long term ecological consequences of this technology. Accordingly, we strongly recommend that the NOSB science panel include ecologists who have expertese in this area, and that the panel's recommendations be based on ecological criteria, rather than limiting judgment to risk.

Section 205.21 -- "General rules for categories of substances and ingredients prohibited for use in organic farming and handling," should be amended by adding the following new subpart (f):

			"(f) Genetically engineered organisms are not approved for use in

		organic farming or handling operations.  There shall be a three year

		moratorium from the date a final rule is published prior to the

		submission of any petitions to the NOSB to add such materials to the

		National List, following the procedures set forth in Section 205.28,

		Provided, That:

			(1) Petitions may be submitted at any time to add a substance or

		technology to the list that involves an application of biotechnology

		other than the insertion of genetic material through recombinant DNA

		techniques into a plant or animal or soil used in agricultural

		production.  The NOSB shall base its approval of such an application

		on precauationary, rather than risk assessment principles.

Section 205.22 -- "Active synthetic substances allowed for use in organic crop production," Subpart (c) should be revised to read:

			"(1) through (5), ..no change…

			Antibiotics otherwise consistent with the rules governing additions

		to the National List may be used as pesticides in conjunction with

		sound biointensive integrated pest management practices and provisions

		in organic farm plans designed to avoid the emergence of resistance;

			And (8), …no change…

			Deleted, (following two items renumbered)

			(d) Toxins derived from genetically engineered bacteria may not be

		used in pest management systems until and unless the NOSB GEO science

		panel determines, in accordance with ecological criteria, that

		materials can be used in an ecologically sound manner. 

Section 205.100 -- "Agricultural products in packages sold, labeled or represented as organic," Subpart (3) should be revised to read:

			"(3) On the principal display panel, the following terms or marks:

				(i)  The USDA seal described in Section 205.170; 

				(ii) A seal representing a state organic program approved by

			the Secretary as provided for in section 205.402 of subpart F,

			Provided, That the agricultural product was certified by a program

			administered by the state program;

				(iii) A certifying agent's name, seal, logo or mark which

			represents that the farm, wild harvesting, or handling operation

			that produced or handled the finished product is a certified

			operation, Provided, That - (1)  the private certifier is

			accredited under Subpart E, or has taking all steps required under

			Subpart E leading toward accreditation, and (2)  the seal or mark

			of the certifier is not more than twice the size of the USDA seal.

				(4) In the event of a product containing 99.5 percent or more

			organic ingredients by weight excluding salt and water, the USDA seal,

			a certifying agent's name, seal, logo or mark, and/or the word "organic"

			as it appears in the principal display panel may appear with a gold

			background or highlighting, consistent with graphic design and display

			guidelines.  Such design guidelines shall be developed and approved by

			the NOSB within 12 months of the publication of this rule, and shall be

			published in the Federal Register, posted on the USDA homepage, and

			provided upon request to all food manufacturers and handling operations.

			Certifying agents shall be responsible for assuring compliance with the

			guidelines; compliance shall be a condition in order to retain status

			as a certified farm or handling operation."

Section 205.101 -- "Agricultural products in packages sold, labeled, or represented as made with certain organic ingredients," Subpart (a), Number (1) should be revised to read:

			"(1) The statement "Made with organic [ingredient(s)]," or

		"Contains organic [ingredient(s)]" may appear beneath the principal

		display panel, or in the information panel, Provided, That (1) each

		ingredient so listed constitutes no less than 15 percent of the product

		weight excluding salt and water, (2) the sum of organic ingredients

		constitutes at least 50 percent of the finished product's weight

		excluding salt and water, and (3) the size of the type used is no

		greater than two-thirds the size of type in the principle display panel."

			"Any label…in this part. 

			Terms that do not directly or indirectly imply organic production and

		handling shall include:

			(i) those referring to crops or ingredients produced with the benefit

		of integrated pest manage (IPM), biointensive integrated pest management,

		ecologically-based pest management, biologically intensive pest management,

		sustainable pest management, earth friendly pest management or other such

		terms referring to the nature or consequences of pest management systems;

			(ii) claims that a food product contains "no detectable pesticide

		residues," is "pesticide free," or "was produced without (synthetic)

		pesticides."

			(iii) claims that animals were raised without use of animal drugs or

		hormones, or using humane handling and animal husbandry methods.

 			(iv) "sustainable agriculture," "sustainable farming systems," or other

 		phrases including the words "sustainable" or "sustainability."

			(b) The NOSB shall be responsible for developing a list of terms that

		imply organic production and/or handling, directly or indirectly, within 6

		months of the issuance of this rule, and shall update such list when and

		as needed."

			"(1) The statement "Made with organic [ingredient(s)]", or "Contains

		organic [ingredient(s)]" may appear on the retail display panel, labeling

		or display container, Provided, That:

			(i) each such labeled ingredient accounts for 15 percent or more of

		the weight of the finished product excluding salt and water; and

			(ii) all organic ingredients in the product account for at least 50

		percent of the finished product weight excluding salt and water; and

			(iii) the type face used for such statements is no larger than

		two-thirds the type face used in the name of the product and the placement

		and graphic elements accompanying such statement shall comply with

		guidelines to be issues by the NOSB within 12 months of the issuance of

		this rule."

			"An agricultural product produced or processed on a farm, wild crop

		harvesting, or handling operation that annually sells no more than $20,000

		in value of agricultural products and which has not been certified, shall

		not:

			(a) Display the USDA seal, or any certifying agent's name, seal, logo,

		or other identification which represents that the farm, wild crop harvesting,

		or handling operation that produced or handled the product is a certified

		operation; or 

			(b) Be identified as an organic ingredient in a product produced or

		processed on a farm or handling operation that annually sells more than

		$5,000 in value of agricultural products."

			"(a) The USDA seal described in paragraphs (b) and (c) of this

		section shall be used in accordance with the provisions of this

		subpart and guidance documents issued periodically by the NOSB, and

		shall be used only on agricultural products (raw or processed)

		described in Section 205.16 (a) of subpart B that are sold, labeled,

		or represented as organic and which are produced and handled on

		certified operations.

			(b) Pending the issuance of further guidance on the design,

		placement and use of the USDA seal on labels, labeling, or market

		information, the USDA seal placed on an agricultural product shall

		replicate the form and design of the example in figure 1.

			(c) Except as otherwise provided through guidance documents issued

		by the NOSB or the Secretary, the USDA seal shall be:

			(1) and (2) …no change…"

The proposed rule implies that the Administrator and USDA will become responsible for final decisions to grant or terminate certification of an organic farming or handling operation. This is unwise and unjustified, and furthermore is clearly not required by OFPA and is inconsistent with the clear message in the Senate Committee report. USDA's appropriate roles in the certification process are limited to --

 	Assessing and dealing with certain conflict of interest issues.



 	Managing the appeals process in cases when a farm or handling operation

	denied certification wishes to contest the decision reached by a private

	certifier. 



 	Assuring that records from one certifier are transferred to another in the

	case of a farm or handling operation denied certification by one certifier,

	when an application is made to another; or, when a certifier ceases

	operations, and the services of a new certifier is sought.

			"(a) …no change though…Provided, That any handling operation that

		provides services to other certified entities that produce or handle

		agricultural products that are, or that are intended to be sold,

		labeled, or represented as organic, or made with organic ingredients,

		would be required to be:

			(1) Certified in their own right; or

			(2) Certified as part of the certification obtained by one or more

		of the parties for whom the handling operation provides services; or

			(3) Fall under the exemption for small scale operations set forth

		in Section 205.202 (a) (1)."

Section 205.208 - "Arranging for inspections," should be revised to set forth the requirement that certifying agents carry out unannounced site visits by adding a new subpart (d):

				"(d)  Each certifier shall carry out unannounced site visits to

		further assure compliance with requirements as set forth herein, and

		as described in the organic farm plan or other documents previously

		submitted to the certifier.  Certifiers shall focus such unannounced

		inspections on farm and handling operations that have not previously

		been certified, have been denied certification previously, or for which

		certifiers have questions regarding the adequacy and compliance with

		organic plans, Provided, That such visits shall be carried out during

		normal business hours and shall be organized, with the assistance of

		the farm or handling operation, in order to minimally disrupt completion

		of time-sensitive tasks."

			"The inspector shall conduct a post-inspection conference with an

		authorized representative of the inspected operation for the purpose of

		confirming the accuracy and completeness of the observations and factual

		information the inspector collected during the visit.  The post-

		inspection conference shall provide the inspector a chance to raise

		additional questions or seek additional documentation pertinent to

		issues that arose during the inspection.  The conference shall not

		include discussion of steps that the inspected party might need to take

		 to come into compliance with the Act, a responsibility that rests

		 clearly in the domain of the certifying agent.  

			"(a) A certifying agent shall follow the procedures in accordance

		with Section 205.518 of this subpart if the certifying agent has reason

		to believe that a certified operation or person responsibly connected

		with a farm, wild crop harvesting, or handling operation it has

		certified has:

			(1) through (3) …no change…

			(b) At such time as the certifier determines there is valid

		evidence to conclude that a violation of the purposes of the

		certification program has occurred, or other significant deviation

		from the requirements set forth herein, the certifier shall notify

		the farm or handling operation of a decision to deny or revoke

		certification within 30 days, or upon the completion of any

		applicable appeal process.  The certifying agent shall also send a

		copy of such notification to the Administrator, who shall maintain

		a central registry of such notices in order to enforce compliance

		with Section 205.204 (d) and Section 205.207 (b)."

			"(c)  Notwithstanding paragraphs (a) and (b) of this section, if a

		certifying agent has reason to believe that a certified operation or

		person responsibly connected with an operation that has been certified

		by the certifying agent has willfully violated the Act or acted in bad

		faith with respect to compliance with regulations adopted pursuant to

		it, the certifying agent shall commence its procedure to deny or revoke

		certification, and shall notify the Administrator of such decision.  A

		notice of recommendation to deny or revoke certification provided to

		the Administrator shall list the names of any persons the certifying

		agent believes to have violated the act and the nature of the violations

		triggering the certifier's action, Provided That, in instances where,

		upon further investigation, the basis for the decision to deny or

		revoke certification is found to be erroneous or founded on malicious

		information, the certifier shall so inform USDA, and the notice shall

		be expunged from the record."

Accreditation

Subpart E - "Accreditation of Certifying Agents" provides for either limited, specific accreditation, or accreditation to perform certification services in multiple areas. This approach is seriously flawed and will greatly increase the cost and complexity of the accreditation process with little or no gain in the quality of certification services offered and delivered.

USDA should accredit certifiers to deliver certification services based on the nature and scope of the services the certifier is currently delivering. Neither certifiers nor USDA can anticipate the nature of certification services that organic farms and handling operations might require in the future. USDA should base its accreditation decisions on the quality of the certification decision-making process as evidenced in past and ongoing work by the certifier. The USDA should not waste time or resources exploring a certifier's hypothetical ability to address issues that might theoretically arise in the certification process. The list of such issues is endless, and could involve any crop or farming system used anywhere in the U.S., or indeed, anywhere in the world. Requiring a certifier to provide evidence of capability to deal with such issues vastly oversteps what is required in OFPA and would be, furthermore, a senseless and impossible endeavor.

Accordingly, several changes are needed throughout Subpart E to eliminate all references to accreditation in specific areas. The justification for these key changes is based on the premise that accreditation should focus on the quality of the procedures and the integrity of the decision-making process a certifier is currently carrying out. A critical step in that process, faced by nearly all certifiers on a regular basis, is assuring that the expertise represented in their functioning committees and pool of inspectors is adequate to carry out credible, informed and incisive certification services in new and sometimes unique circumstances. An element of accreditation should be how certifiers rise to such new challenges.

Furthermore, accreditation evaluation should include on site spot visits of a small percentage of farms or handling operations certifed by the certifier. Such on site inspection of a certifed operation to verify that what certifers calim in documetns are actually carried out in the field.

If a certifier and its functioning committees lack the expertise to evaluate a farm plan, or if a certifier selects an unqualified individual to carry out an inspection, the lack of decisive questioning and information gathering will be evident in the files, and if that expertise is not carried out in the field it will be evident on site. Those carrying out an accreditation review will routinely question the technical foundation of certification decisions made in the recent past. Recognition of a pattern of failing to seek out additional expertise when facing new and technically novel certification challenges should be grounds for USDA to deny or withhold accreditation until such deficiencies are corrected.

Alternatively, USDA might consider contracting out the accreditation evaluation to a private accrediting body. That approach might be more cost effective in the long run.

In order to correct this problem, several passages will need to be either reworded or deleted. Rewording is needed (at a minimum) in: Section 205.300, Section 205.316 (c) (1).

The following subsections should be deleted, and subsequent sections renumbered: Section 205.303 (c); Section 205.306 (b), Number (1).

Section 205.301 - "General requirements for accreditation," Subpart (12) should be revised to read:

			"(12) Refrain from making false or misleading statements about its

		accreditation status, the USDA or other accreditation programs, or the

		requirements set forth in this regulation."

Section 205.301 - "General requirements for accreditation," Subpart (b) should be revised to read:

			"(b) A private person or governing State official accredited as a

		certifying agent under this subpart may establish a seal, logo or other

		identifying mark to be used at the discretion of farms, wild crop

		harvesting operations, and handling operations certified by the

		certifying agent in order to denote affiliation with the certifying

		agent, Provided, That the certifying agent:

			(1) Does not require as a condition of certification by it the

		display of its identifying mark on any product sold, labeled or

		represented as organically produced; and

			(2) Does not require as a condition of use of its identifying mark,

		seal or logo additional fees or compliance with any farming or handling

		practices or requirements that are inconsistent with the purposes of the

		Act and regulations promulgated pursuant to it."

Furthermore, the OFPA does not require that implementing regulations serve as both a floor and a ceiling and there is no basis for USDA to speak for Congress on such a fundamental and key policy issue. In the years ahead some segments of the consuming public are bound to have unique concerns about the food they purchase and consume. For example, people with certain digestive problems, food allergies, or chemical sensitivity, might wish to seek out food grown in a region where there is no record of persistent pesticide residues in soil nor risk of drift from nearby conventional operations. Other people having problems conceiving, or concerned about the health of their children, might choose to seek out foods with even higher margins of safety and quality than provided for in the rule. Some people might wish to support a local or regional certifier because of their contributions to public education, worker safety campaigns, or improving local water quality.

The proposed rule's effort to speak to these issues by allowing producers and manufacturers to make additional label claims and allowing certifiers to verify those claims is totally unworkable. It reverse the certification process recognized in the international community by forcing certifers to establish standards for label calims, rather than requiring that label claims conform to standards. Such a certification scheme would not be reliable and would not invite consumer confidence.

To facilitate the exercise of consumer choice, and the emergence of value-added niche markets, certifiers should be free to explore ways to encompass additional quality attributes in their programs, including some beyond the requirements addressed in the OFPA, as long as such attributes and requirements are consistent with the purposes of the Act, factual, and not misleading.

Last, an attempt to set a floor and ceiling through federal rulemaking is out-of-step with the vast majority of federal law and regulations, especially laws passed in recent years. If USDA does not change this provision, it is inevitable that an effort will be made to amend this provision and/or challenge it in court. Both efforts are likely to be successful given the general belief in Congress that innovation and experimentation should be encouraged through limits on federal powers and by delegating responsibility to units of government and private entities closer to the problems being addressed through public policy and public-private initiative.

Section 205.301 - "General requirements for accreditation," Subpart (c) (2) should be revised to read:

			"(2) Certifying agents shall disclose annually to farms and handling

		operations seeking certification services the extent and nature of any

		bonds, security or insurance coverage intended to hold applicants and

		certified parties harmless in the event of legal action taken against

		the certifying agent or any operations certified by the agent."

Just as in other areas of the economy, disclosure and competition have together proven effective in motivating certifiers to improve program efficiency and revisit the value of various program activities and requirements. The USDA should resist the temptation to manage the private business decisions and relationships that emerge between farming and handling operations and certifiers. Such an attempt will lead to the need for an ever-bigger federal role, more bureaucracy, less innovation, and more controversy. As a result, program costs will grow in step with the number and seriousness of disputes that have to be resolved.

Analogous change are needed also in Section 205.306 (b), Number (3).

Section 205.305 - "Statement of agreement to be submitted by an accreditation applicant," Subpart (a), Number (3) should be revised to read:

			"(3) Refrain from making false or misleading statements about its

		accreditation status, the USDA or other accreditation programs, or the

		requirements set forth in this regulation."

Fees for Accreditation

Section 205.421 - "Fees for accreditation applicants and accredited certifying agents" -- is seriously flawed and requires substantial reform in the interests of equity, efficiency, and in order to achieve the stated goals of the OFPA.

The proposed fee structure is grossly inequitable. For example, the proposed rule would impose an additional fee of just $160.00 to cover the costs of accrediting individual CCOF chapters that carry out certification services in excess of all the NOFAs combined, each of which would be required to pay $3,500.00. Certifiers active in several states and countries will clearly be more difficult to accredit, or build a case to not accredit, than certifiers concentrating their activities within a given region, or working through chapters which operate in defined regions.

As currently proposed, the fee structure needlessly undermines the ability of the USDA to carry out an effective, targeted accreditation program and will greatly increase the administrative costs and controversies that arise as USDA carries out its accreditation responsibilities.

Instead of the current fee structure, which strives to recover USDA's costs in carrying out accreditation, the USDA should seek and be given appropriated funds to cover its direct costs in carrying out accreditation activities, while certifiers should bear the costs imposed on them by the accreditation process. Such an approach is consistent with the stated purpose of OFPA, because it is clear that the administrative costs and controversies likely to be triggered by the currently flawed and grossly unfair fee structure will cost the USDA more to contend with than the revenues that will be generated.

Based on the USDA's projections, the Department's annual accreditation activities will cost less than one million dollars, and hence a fee structure was devised to raise this level of revenues. This also happens to be about the sum appropriated to the program the last three years as the rule drafting process has continued. USDA considered, but rejected a sliding scale for fees, or a "pay as you go" policy in the interest of equity, and recognizing the difficulty of devising a fair way to adjust accreditation costs as a function of the size of a certifier. Even more serious is the need to project and cover the costs of the accreditation process stemming from reviews of those certifiers that are not doing an adequate job, triggering the need for USDA to collect and analyze additional information.

Under the current fee structure, USDA's hands will be tied in dealing with certifiers who are less than forthcoming or which have difficulty documenting their activities. This is because the scope of accreditation review activities will be constrained by the amount of fees received from a given certifier. The fee structure will dictate a "stay-within-costs" formula approach to accreditation which will prove adequate in some cases, but grossly inadequate in others. As a result USDA's ability to steadily improve the quality of certification services will suffer.

Disagreements are bound to arise. Under the current fee structure, USDA is likely to give certifiers the benefit of the doubt as the process moves toward establishment of an information base sufficiently complete and sound for USDA to sustain a contested decision to deny or revoke certification.

There is an even more fundamental flaw in the fee structure as proposed - those certifiers doing an exemplary job in complying with the Act, and investing in good record-keeping and audit trail systems, will be forced to pay for the many additional steps required to resolve the accreditation status of certifiers doing a less exemplary job, or engaging in sloppy or outright fraudulent activities.

As set forth in Subpart E, the process USDA must work through before denying accreditation is both drawn out and costly. Under the fee structure as proposed, exemplary certifiers will pay twice and still face unfair competition from cut-rate and/or shoddy certifiers that can hold off final USDA actions denying accreditation, in all likelihood for several years.

For these reasons, the most cost-effective way for USDA to carry out its accreditation responsibilities is to retain and exercise complete flexibility in targeting its resources toward reviews and corrective actions among those certifiers that are not currently performing up to standards. A logical step in doing so, for example, would be to streamline the accreditation process for certifiers that have established an exemplary record and/or subjected themselves to external reviews or accreditation by a third party such as IFOAM or a state program. By targeting its effort where the greatest gains can be made in steadily improving the quality of certification services, USDA will provide the firmest foundation for growth in consumer confidence in the industry. Achieving this goal will, in turn, drive up demand for organic food products faster than otherwise likely.

While OFPA requires USDA to recover the costs of the accreditation program, this goal can be achieved in many ways. The most constructive approach that is fully consistent with the OFPA statute is to foster accelerated growth in the organic food industry by aggressively implementing the accreditation program and bringing about steady improvement in the quality of certification services, and the confidence placed in U.S. grown and processed organic products here and abroad. In this way, USDA can support accelerated industry growth such that the tax revenues stemming from the premium prices the market is willing to pay for organic foods will more than offset the modest cost of accreditation born by taxpayers.

Thanks for the opportunity to submit these comments. We look forward to review of the re-proposed rule.

Sincerely,

Fred Kirschenmann

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