* Furlough notices are en route to inspectors this week
* Meat inspection is most visible of $1.9 bln in cuts
* Cotton payment to Brazil is WTO case is affected too
By Charles Abbott
WASHINGTON, March 5 (Reuters) - Furloughs of U.S. meat inspectors that could disrupt meat delivery throughout the country will probably be concentrated in July through September, Agriculture Secretary Tom Vilsack told lawmakers on Tuesday.
Vilsack said furloughs of meat inspectors required under sequestration, or automatic budget cuts that took effect this month, will disrupt the meat industry. He said USDA will send furlough notices to meat inspectors this week, but it will be several months before they will occur because of the extensive preparations needed.
The furloughs, which could lead to spotty shutdowns of meat plants and meat shortages, would be one of the most visible effects of sequestration, he said. By law, processors cannot ship meat without the USDA inspection seal.
“We will do everything we can to minimize disruptions,” Vilsack said at a hearing of the House Agriculture Committee. “It will impact inspections.”
USDA has said it would stagger the furloughs to minimize their effect on operations. “I don’t think you’re going to see a continuous furlough,” Vilsack told lawmakers at a hearing on the state of the rural economy days after U.S. President Barack Obama signed the sequester order.
The Obama administration says all 8,400 inspectors might be furloughed for a total of 15 days. Vilsack said the total was more likely to be 11 or 12 days.
The agency will need a substantial amount of time to deliver notices to inspectors, hold consultations and schedule furloughs, said Vilsack.
“We are looking at a several-month period, if you will, before a furlough could be implemented,” he said. “The industry will have some notice of what will happen.”
As a result, the furloughs could take place mainly in the final three months of the fiscal year, which ends on Sept. 30. “That’s one of the problems,” Vilsack said. One-third of USDA’s 100,000 employees may be affected by furloughs.
“It’s a process we have to follow,” he told reporters. He said USDA was not trying to delay action in hopes that Congress would resolve the fiscal crisis and eliminate the furloughs.
The administration says furloughs of inspectors en masse would shut down meat packers and processors for two weeks and cost them $10 billion in production.
Meat inspectors are guaranteed 30 days’ notice of a furlough, said the union that represents them. Inspectors could face a furlough of one day a week but not always the same day.
During the hearing, committee chairman Frank Lucas, a Republican from Oklahoma, chided the administration for “trying to scare the American people with worst-case scenarios.”
Recent suggestions by USDA of a two-week total shutdown of the meat industry “affected prices, caused concern among financial markets and alarmed buyers and sellers in the retail and food service community,” Lucas said.
Some Republicans on the committee suggested USDA could avoid furloughs by shifting money among other accounts or by cost-cutting in other areas within the agency.
But Vilsack said the furloughs were unavoidable when spending must be cut by 10 to 12 percent for the rest of the year - to achieve a 5-percent cut for the fiscal year - and inspectors account for 87 percent of the meat agency’s budget.
“No matter how you slice it,” said Vilsack, furloughs are certain. “We are going to try to maintain movement through the (meat industry) process,” he said.
Lucas and Rep Steve King of Iowa said the administration was providing little help to House Republicans on how to restructure the automatic cuts into a less painful package. The House was expected to vote later in the week on a Republican alternative. It would not alter the sequester’s impact on meat inspection and most other USDA programs, though.
USDA’s funding was cut by $1.9 billion by the sequester. USDA says the cuts mean less money for soil conservation and farm loans, the shutdown of camp grounds and visitor centers in some national forests and a smaller caseload for the so-called WIC program that provides additional food for poor pregnant women, new mothers and their children.
The item-by-item cuts would also reduce slightly the funds available for a $147 million payment due this year to Brazil as a step toward resolving a World Trade Organization ruling against U.S. cotton subsidies, Vilsack said.