Foreign Assistance: Donation of U.S. Planting Seed to Russia in 1999 Had Weaknesses

The Department of Agriculture in its June 27, 2000, statement of action on this recommendation stated that the Foreign Agricultural Service did share information on bilateral discussions of seed sales or donations in a timely manner with the Farm Service Agency in order to facilitate open and competitive procurement of seed. The Department's response did not provide specific details on how it has improved the process for the Fiscal Year 2000 U.S. Donation of Planting Seeds to Russia.

The Department of Agriculture in its statement of action indicates that the Farm Service Agency (FSA) accessed the American Seed Trade Association (ASTA) for advice on the U.S. seed industry and for technical assistance and related information. The Department describes improvements in this process by identifying the following changes made for the Fiscal Year 2000 U.S. seed donation program to Russia: (1) all seeds purchases are being conducted using open tenders; (2) invitations soliciting supplier bids are sent to a large list of potential vendors provided by the national seed trade association (ASTA) and supplemented through efforts by FSA; (3) information on variety descriptions and characteristics has been obtained from various non-supplier-sources; (4) information on certain patented varieties has been obtained from non-supplier sources and shared within USDA and the Russian Government; and (5) FSA has identified a number of seed experts, both in research agencies of the USDA and in private industry, to provide technical expertise and to advise on future program purchases. The implementation of these revised processes is ongoing and should be evaluated after the Fiscal Year 2000 program is completed.

The Department of Agriculture's Statement of action dated June 27, 2000, indicated that because of short turnaround time in the fiscal year 1999 food aid seed program, the U.S. Supplier was unable to print and affix Russian language labels to the bags of donated U.S. seeds. The Department noted that in the fiscal 2000 seed program Russian language labels are attached to the bags of donated U.S. seeds. It also informed us that English and Russian language information on the seed varieties has been provided to the Russian agent handling the seeds under the fiscal year 2000 agreement who, in turn, provides it to the prospective buyers of seeds.

The Department of Agriculture in its June 27, 2000, statement of action reiterates its position that the Bilateral Working Group made pricing determinations after a review of pricing information presented by the Russian Ministry of Agriculture and Food and Russian Ministry of Trade. The Department adds that, in the fiscal year 2000 seed food aid program to Russia, a public auction approach was used to set prices. It said that this produced mixed results that, while providing more transparency and market-oriented pricing, some seeds were delayed and others were not sold. In its statement of actions, the Department of Agriculture did not address the issue of documentation as it relates to pricing. This was a fundamental part of GAO's recommendation. Without adequate documentation, it is difficult not impossible to assess pricing decisions.