The Committee on Small Business held a hearing this week in the Agriculture, Energy and Trade Subcommittee on “Regulatory Injury: How USDA’s Proposed GIPSA Rule Hurts America’s Small Business.” The hearing examined how USDA’s proposed Grain Inspection, Packers and Stockyards Administration (GIPSA) rule could potentially hurt thousands of small businesses in the poultry, beef, and pork industries.

The hearing had two panels.  The first panel had Edward Avalos, under secretary, marketing and regulatory programs at USDA and Alan Christian, deputy administrator, GIPSA.  The second panel was made up of livestock and poultry producers.

In June, Subcommittee Chairman Scott Tipton (R-CO) and Small Business Committee Chairman Sam Graves (R-MO) sent a letter to USDA Secretary Tom Vilsack calling on the agency to fully comply with the Regulatory Flexibility Act (RFA) and ensure that USDA understands the private sector costs of the regulations it is imposing on all sectors within the poultry and livestock industries.  “More troubling are the inadequacies in USDA’s Initial RFA and their failure to take into account the economic impact on small business,” said Chairman Tipton, especially when  USDA acknowledges that a majority of people involved in the livestock industry are small businesses, he said.

Tipton remarked that he was pleased to hear from Avalos that USDA is “fairly close” to completing the final economic analysis of the GIPSA rule. “This is the most information we have received from USDA since the analysis begin. Nevertheless, I find it troubling that they are fairly close to completing the economic analysis, yet dodged questions in the hearing and claimed that it’s too early in the process to answer specific questions on the impact it will have on our job creators, ” Tipton commented after the hearing.

The four witnesses on the producer panel were Robbie LeValley, LeValley Ranch, Hotchkiss, Colorado; Gary Malenke, Sioux-Preme Pork Products, Sioux City, Iowa; Joel Brandenberger,  National Turkey Federation, Washington, DC; and Bob Junk, Fay-Penn Economic Development Council, Uniontown, Pennsylvania.  With the exception of Bob Junk, who represented the National Farmer’s Union, all witnesses reinforced the idea that the proposed GIPSA rule will ruin healthy industries and harm rural development.  “The proposed GIPSA rule will destroy our small business model, force us to lay off our employees, cripple our ability to market our cattle in a way we want to, and limit consumer choice, ” Robbie LeValley said.