Yet the early-out was a catalyst that allowed MDA Director Dan Wyant to implement a staff-driven plan to significantly streamline the agency. Eleven formerly free-standing divisions were combined into eight new ones to improve coordination, resource efficiency and other qualities of good government.
    
With a more integrated structure in place, MDA pursued four main missions: food safety, environmental stewardship in agriculture, consumer protection, and increased economic development of Michigan's agriculture industry. Highlights of these activities are detailed in the next section.

Food Safety Milestones

Food Safety Alliance Initiated. In 1997, MDA pioneered a Food Safety Alliance. This MDA-led roundtable draws members from Michigan State University, Michigan Farm Bureau, other government and agriculture agencies, producer groups, the agriculture industry and consumer groups. Alliance members share information on food safety issues and serve as a forum for discussions on food safety policy.

Project SAFE Created. Early in the year, MDA established a Project SAFE Team of trained epidemiologists, medical doctors and food scientists in state government to respond immediately and without regard to jurisdiction when food safety crises occur in the State of Michigan. The program is serving as a model for other states and the federal government.

Protecting Apple Cider. MDA worked with the state's apple cider makers throughout the year to develop Good Manufacturing Practices, which were used as a national model. The GMPs call for improved labeling, eliminating the use of dropped fruit, and curtailing practices that could contaminate the product. These steps will protect consumers and the quality and reputation of Michigan cider.

Foodborne Illness: Strawberries. The Hepatitis A outbreak in 1997 was a classic illustration of MDA's ability to partner with local and federal agencies to quickly isolate, identify and contain foodborne illness. This particular foodborne illness, which gained national attention, sickened over 300 Michigan residents, mostly schoolchildren. The source was traced from frozen strawberries served in Michigan school lunch programs back to a California processor and a Mexican farm that were both possible sites of contamination. The U.S. Food and Drug Administration Commissioner honored MDA's work on this investigation.

Foodborne Illness: Alfalfa Sprouts. In the summer of 1997, another outbreak of foodborne illness was discovered in Michigan. Over 40 people were sickened by eating contaminated alfalfa sprouts, which MDA was able to trace to a food distributor. The source of contamination was the seeds used to produce the sprouts. They were subsequently traced to farms in the western U.S.

Seizure of Food Products. A traditional and critical function of MDA's food inspectors is the seizure and destruction of contaminated or adulterated food. In 1997, MDA seized over 3.3 million pounds of food, preventing countless cases of foodborne illness and other detrimental effects.

Environmental Milestones in Agriculture

Environmental issues in modern agriculture continued to gain momentum across the U.S. in 1997. In Michigan, MDA led the way with a strong slate of programs that work cooperatively with farmers and ag producers to identify and minimize adverse environmental impacts to Michigan's natural resources.

Environmental Stewardship Division Created. As part of the reorganization, MDA Director Wyant consolidated the department's environmental activities under the umbrella of the new Environmental Stewardship Division. Programs to protect groundwater, to identify good agricultural

practices and to encourage wise stewardship of ag resources are now more integrated.

Pollution Prevention Strategy Signed. MDA assisted this producer-driven initiative to develop a statewide Pollution Prevention Strategy for Michigan Agriculture, which was completed in late 1997. It culminated a year of cooperation between MDA and the state's agricultural producers to develop a blueprint for environmentally-friendly ag practices into the 21^st century. The strategy has been signed jointly by MDA Director Wyant and Russell Harding, Director of the Michigan Department of Environmental Quality (MDEQ).

Groundwater Stewardship Program Grants Made. Michigan continued its strong Groundwater Stewardship program, which issued a total of $3 million in grants to agricultural projects in 78 counties. The grants will be used to cap potentially dangerous abandoned water wells, evaluate farm practices for environmental impacts, provide technical assistance in fertilizer or chemical spills, and monitor groundwater for private well owners.

Operation Clean Sweep Successes. MDA's innovative Operation Clean Sweep collected, paid for and properly disposed of nearly 50,000 pounds of unusable pesticides from farmers, ag businesses and consumers in 1997. Operation Clean Sweep helps keep these substances out of landfills, wastewater treatment plants and other disposal routes that could lead to groundwater contamination.

Urban Pesticide Education Begun. MDA initiated several long-term projects in 1997 that were targeted to educate urban residents about safe pesticide use and risks of using illegal pesticides. The Pesticide & Plant Pest Management (PPPM) Division also implemented more rigorous procedures for detecting uncertified and unlicensed pesticide applicators in at-risk communities.

Working for Safe Pesticides. The 1996 federal Food Quality Protection Act (FQPA) established new provisions for determining pesticide residue tolerances on raw and processed agricultural commodities in an effort to increase safety standards for people, especially children. While the intent of the FQPA is good, its implemention may seriously impact the production of minor crops due to a reduction in the number of pesticides available. This is especially critical for Michigan because it is the second most diverse agricultural state in the nation. The department has been working with the U.S. Environmental Protection Agency and Michigan State University to collect pesticide use information and analyze crops for pesticide residues with a goal of implementing FQPA in a manner that relies upon sound science and statistics. The result will be protection for consumers from overexposure to pesticides while preserving the economic viability of Michigan agriculture.

Training Public Workers in Safe Pesticide Application. In 1997, the department cooperated with the Michigan Pest Control Association to provide free integrated pest management (IPM) training for employees of schools, public buildings and health care facilities. MDA's IPM Program helps pesticide applicators comply with the law and seek effective alternatives to traditional pesticides. In 1997, 528 individuals received this special training.

Gypsy Moth Program Attacks Michigan's #1 Pest. In 1997, the Michigan Cooperative Gypsy Moth Suppression Project treated 24,000 acres in nine Lower Peninsula counties, protecting shade trees and landscapes valued at $5.8 million. MDA's participation in a Slow-the-Spread Project has succeeded in slowing the average spread of gypsy moths from 13 to 3 miles per year.

Expanding the Cranberry Industry. MDA has continued to encourage cranberry production as an economic boon and diverse crop for Michigan fruit farmers. In 1997, Muskegon County officially agreed to a study using 1,800 acres of public land for cranberry production as a result of its strategic planning with MDA, Consumers Energy, Michigan State University and the Rural Development Council of Michigan. Ultimately, cranberry production and processing should generate $13 million annually and over 500 jobs in the local area.

Retaining a Cherry Manufacturer. Although Michigan is the cherry capital of the world, the world's largest cherry products manufacturer was considering moving elsewhere. To solve a wastewater treatment issue that allows the company and city to be good neighbors, MDA and the Michigan Jobs Commission got involved. A $735,000 state grant to the City of Hart enhanced wastewater treatment facilities to accommodate Gray & Company expansion, which then hired 35 more local citizens.

Shrimp Farming in Michigan. Shrimp farming was officially recognized in Michigan in 1997. MDA issued the first aquaculture registration to Seafood Systems, Inc. of Okemos. The company produces over 10,000 pounds of shrimp a year with plans for expansion. MDA administers the Michigan Aquaculture Development Act which allows the production of shrimp, trout and other aquatic species on farms.

MDA's website (www.mda.state.mi.us) continues to offer learning opportunities for children. The site's Kidz Korner has received international acclaim for its approach to teaching young people about agriculture.

State Fair Comes Home. In 1997, Governor John Engler transferred oversight responsibility for the Michigan State Fair back to the Michigan Department of Agriculture. As the State Fair moves into its 150th year, it is appropriate that it return to its roots in Michigan agriculture.

Accuracy in weights and measures. Michigan leads all states in the accuracy of high-precision mass calibration tests at the E. C. Heffron Metrology Laboratory in Williamston. The lab, dedicated in 1997, ensures that the products of Michigan's high-tech industries, particularly those sold for military purposes, meet quality standards required for national and international trade.

Gasoline Quality Assured. MDA recorded a significant 30 percent drop in consumer complaints about poor-quality gasoline. The improved consumer satisfaction with gasoline quality follows increased monitoring and fuel testing by MDA's Motor Fuels Quality Program.

TB Issues Addressed. In 1994, a white-tailed deer in northeast Michigan was discovered to have

bovine tuberculosis. The finding by a hunter, during the regular hunting season, launched an increased deer surveillance program by the Michigan Department of Natural Resources (DNR). MDA also responded with a TB testing program for cattle within a five-mile radius of the location where the deer was found. While the number of deer diagnosed with bovine tuberculosis has increased since 1994, Michigan has maintained its TB-free status for cattle and continues its aggressive surveillance program. During 1997, the state initiated a plan to eliminate bovine tuberculosis from Michigan's deer population. For more information, please see the Animal Industry Division accomplishments in the next section of this report.

Preventing BSE in Animals. A U.S. Food and Drug Administration ban was issued in 1997 to protect U.S. cattle from developing

bovine spongiform encephalopathy (BSE -- sometimes called "mad cow disease"), which has been detected in Europe but never detected in U.S. herds. Scientists believe there may be a link between BSE and a variant form of Creutzfeldt-Jakob disease, which is fatal to humans. The Michigan Department of Agriculture conducted a training program for state and federal inspectors from Michigan, Ohio and Indiana to ensure that the feed and rendering industries comply with a federal ban prohibiting rendered protein products from being used in feed for cattle and other farm animals.

Michigan Crops Lead Nation. Michigan farmers lead the U.S. in production of many key crops including black beans, cranberry beans, navy beans, blueberries, tart cherries, pickling cucumbers, and potted geraniums, Easter lilies and 10 other important floricultural crops.

Executive Office

The Executive Office provides administrative and policy direction for the Michigan Department of Agriculture (MDA), housing the Office of the Director, Deputy Director, Director of Agriculture Policy and Special Projects, Legislative Liaison, and support staff.

The Director of Agriculture Policy works closely with the Director to formulate new department policies and to review or revise existing policies. In addition, federal legislation and programs are monitored by this office. The Legislative Liaison is MDA's link to the Michigan Legislature concerning all legislation that affects the department and the agriculture industry, as well as directing all department rulemaking activities.

MICHIGAN STATE FAIR TRANSFERRED TO MDA
In October 1997, the Michigan State Fair and Exposition Center was transferred to MDA from the Department of Commerce (now known as the Department of Consumer and Industry Services). Although housed within MDA, fair policy and direction continue to be established by the State Fair Advisory Board, which is appointed by the Governor.

The State Fair and Exposition Center hosts a wide variety of events throughout the year including the Shrine Circus, the Governor's Luncheon, youth livestock auctions, and livestock and community art exhibitors. The 1997 fair had over 60 major sponsors who contributed over two million dollars in cash and in-kind support. Although attendance was down in 1997 with only 404,583 visitors, due to cold and rainy weather, total fair revenue was over $4.6 million.

E. C. HEFFRON METROLOGY LABORATORY OPENS
In June 1997, one of the nation's finest weights and measures laboratories officially opened its doors. The E. C. Heffron Metrology Laboratory, located in Williamston, was named after the late Dr. Edward Heffron, former Director of MDA's Food Division.

Designed by Clark Construction, the lab provides ultra precision testing for Michigan businesses,

especially those manufacturers who export their products or sell products to the U.S. military. The lab also provides mass, length calibration, and testing services for state agencies, local government agencies and industry. Additionally, it conducts regulatory services and calibration standards used for enforcement by the Michigan State Police, Treasury, and Agriculture departments and all county road commissions.

This new $2.2 million state-of-the-art facility was needed in order for Michigan to maintain its current accreditation from the National Institute of Standards & Technology (NIST). Michigan's first metrology lab, established almost 30 years ago, no longer had adequate environmental controls or the capacity required for today's stricter demands.

FOOD SAFETY AWARENESS CAMPAIGN LAUNCHED
In July 1997, MDA assisted in the launching of the Michigan Food Safety Awareness Campaign to provide helpful information to Michigan consumers to prevent illness and disease from improper handling and/or cooking of food. The program involved a partnership among Michigan's food and agriculture industry.

A kick-off press conference was held in four Michigan cities (three in grocery stores and one at a food bank), and several news releases were issued to provide consumers with basic common sense tips about food handling.

TEAM RESPONDS TO FOODBORNE ILLNESS OUTBREAKS
In October 1997, MDA, in conjunction with the Department of Community Health, joined forces to create a Food SAFE (Special Actions for Food Emergencies) Team. The purpose was to utilize a cross-department team of scientists, epidemiologists, veterinarians and physicians to respond swiftly to suspected foodborne illness outbreaks.

According to the Centers for Disease Control and Prevention, up to 2.5 million cases of foodborne illness occur each year in Michigan. The team helped successfully contain threats to public health after Hepatitis A was found in strawberries, E. coli in alfalfa sprouts and cider, and Salmonella enteritidis in eggs.

DAIRY PRICING AGREEMENT
In the fall of 1997, the previous dairy "super pool" voluntary agreement had fallen apart and the over order premium prices were in jeopardy. A pooling arrangement was needed to distribute the premiums to all "Grade A" milk producers. The unanimous preference of the industry was a voluntary pool; however, failing that, all were willing to seek a legislatively mandated solution.

MDA facilitated discussions with the various parties to discover the parameters for a voluntary agreement. Concurrently, legislation was initiated to mandate milk prices which were to be paid to producers. Hearings were held in the House and Senate directed at enabling producers, through referendum, to set over order prices within a certain range.

The result was that the industry concurred on a new voluntary agreement. This agreement is very similar to the previous one. The top of the price range will not exceed $1.25/cwt over the Federal

Order price. Terms of the agreement are to be continued indefinitely with specified procedures for withdrawing, including time of notice. The successful culmination of the discussions and resolution of the issue could mean as much as $24 million annually to Michigan dairy farmers.

ETHANOL USE PROMOTED
Ethanol, an environmentally friendly alternative fuel, is now available in Michigan. There are two locations for fueling E-85 vehicles, in Detroit and Lansing. The E-85 vehicles are produced by Ford Motor Company and Chrysler Corporation. General Motors has sponsored a contest involving engineering students from 14 universities, challenging them to improve the performance of the Chevy Malibu equipped with an E-85 engine. Awards will be conferred May 26, 1998 at the GM Milford Proving Grounds. These vehicles and teams will then convoy to Washington D.C. to highlight the benefits of ethanol as an alternative fuel.

LEGISLATIVE ACTIVITY
Over the past year, legislative activity resulted in the enactment of five major new bills:

.     Pet Sterilization - requires pets adopted from animal shelters to be sterilized.
.     Small Business Tax/Nursery - exempts nursery sales to landscape contractors/wholesalers from taxes and adjusts tax base of farmer cooperatives.
.     Biosolids - provides for biosolids land application program under DEQ. MDA is responsible for the landowner/local government education program.
.     Land Division - changes requirements with respect to water and sewer in subdivisions.
.     Equine Industry - deposits into compulsive gaming prevention fund a percentage of Michigan ag equine industry development fund.

Three rules were promulgated:

.     Dispensing Facility Reid Vapor Pressure - effective August 1997
.     Smoked Fish Regulation - amended February 1997
.     State Purse Supplements for Harness Horse Racing - amended March 1998

The department also rescinded 17 Animal Industry and Food/Dairy rules which were obsolete.

Animal Industry Division

MDA's Animal Industry Division protects the public health and the health of domestic animals, livestock and pets. The State Veterinarian is responsible for overall livestock and poultry reportable disease programs and toxic substance contamination concerns as they relate to animal health. The division participates in several industry/state/federal disease eradication programs, which help ensure the import and export of healthy livestock. These provisions have a significant impact on human health and welfare through protection of the state's food supply.

Some of the diseases that threaten Michigan livestock are Pseudorabies, Eastern Equine Encephalitis (EEE), Equine Infectious Anemia (EIA), tuberculosis (TB), rabies and various toxicities.

MDA PLAYS KEY ROLE IN CONTAINING TB THREAT
In the November 1994 firearm deer hunting season, a wild white-tailed buck was shot on a private hunt club in Alpena County. While gutting the deer, the hunter noticed several pea-sized yellow nodules in the lungs and on the rib cage. Concerned about this odd finding, the hunter contacted the Michigan Department of Natural Resources (DNR). The deer was examined and diagnostic tests were performed to determine the cause of the abnormal findings. A diagnosis of bovine tuberculosis (TB) was confirmed when bacteriological culturing was completed in February of 1995. Bovine tuberculosis is caused by Mycobacterium bovis, a very slow growing bacteria.

Bovine tuberculosis (M. bovis) is a disease primarily of cattle that has the potential to have a major impact on public health and the economic viability of the livestock industry in Michigan and nationwide. Michigan entered into the federal bovine tuberculosis eradication program in the 1930s, and achieved Bovine Tuberculosis Accredited-Free state status for our cattle on October 19, 1979. Principally through an on-going slaughter market cattle carcass inspection, Michigan has maintained this esteemed and valuable designation.

The farmed cervid (deer, elk, reindeer, etc.) industry, a progressive and growing part of Michigan's livestock industry, has adopted a proactive and comprehensive bovine tuberculosis surveillance program for captive and farmed cervids encompassing stringent interstate and intrastate testing requirements, as well as a herd accreditation program. During 1996, this surveillance resulted in the testing of 833 deer (including reindeer) and 893 elk. In 1997, 2,196 captive deer and elk were tested for TB. There are currently 30 bovine tuberculosis accredited cervid herds and 15 tuberculosis qualified cervid herds in Michigan. In 1998 to date 1,255 captive deer and elk have been TB tested.

In December 1997, a captive cervidae livestock premises comprised of approximately 1,400 acres in Presque Isle County was found to be culture positive for M. bovis and infected with bovine tuberculosis. This herd is quarantined and currently is undergoing depopulation by Michigan Department of Agriculture (MDA).

There are approximately 30 captive cervidae livestock premises in the five counties of Alcona, Alpena, Montmorency, Oscoda, and Presque Isle. MDA has contacted the herd owners and has developed individual written herd plans to conduct appropriate surveillance. To date, surveillance has been completed on 14 herds.

By April 1999, MDA will have tested all cattle and goats over six months of age in the five counties of Alcona, Alpena, Montmorency, Oscoda, and Presque Isle in northeast Michigan. One hundred forty-one (141) premises housing 5,258 cattle, 54 pigs, 92 goats, and six llamas have been tested to date. In June 1998, one cow from an Alpena County farm tested positive for the disease.

In 1997, Michigan set out to design a plan, based on the best available science, that will eliminate bovine TB infection from Michigan's wild deer population. Many factors such as the health of the wildlife, livestock, and the public, as well as the economy and ecology of the area were considered. Farmers, hunters, land owners, and the public are all stakeholders in this disease dilemma. A "TB Core Committee," made up of representatives from all involved agencies as well as all involved stakeholders, was charged with the task of designing this recommended plan of future surveillance

and management activities for the wild deer, livestock, and other wildlife. The plan, with the goal of eliminating bovine tuberculosis in Michigan, was submitted to the Directors of DNR, MDA, and MDCH in September 1997 for consideration and implementation.

In addition, economists from MSU assessed the economic consequences associated with M. bovis in northeastern Michigan. Among the many findings in the MSU report of the economic consequences associated with M. bovis in northeastern Michigan are:

1.    The dairy, beef cow-calf, and cattle feeding industries in Michigan are the enterprises most likely to be affected by loss of the Bovine TB Accredited-Free Status.
2.    If Michigan were to lose its Bovine TB Accredited-Free Status in 1999, using a net present (1997) value analysis of the cost of testing Michigan cattle, it is estimated there would be a gross sales loss of $22 million for the dairy, beef cow-calf, and cattle feeding industries for 1999-2003 and $62 million for 1999-2008.
3.    The effects of a loss of TB Accredited-Free Status in Michigan's captive cervid industry would be a reduction in interstate sales (currently $4.1-$7.4 million annually), diminished industry growth, and a significant increase in TB testing costs resulting in decreased net values.

On January 29, 1998, Governor Engler issued Executive Directive No. 1998-1 for the MDA, DNR, and MDCH to develop management plans for eradicating bovine tuberculosis in Michigan deer. The eradication strategy is to include the following:

1.    Define an implementation strategy for a mandatory feeding ban in the five-county area;
2.    Develop wild deer herd harvest quotas consistent with the eradication of bovine tuberculosis;
3.    Develop and implement methods for farmers to eliminate contact between free-ranging wild deer and livestock;
4.     Continue comprehensive surveillance of livestock and deer in the five-county area to determine the actual prevalence of the disease and accurately evaluate trends;
5.    Disseminate information to hunters, farmers, and the public regarding the need to manage wild deer in the five-county area to eradicate bovine tuberculosis; and
6.    Identify a Bovine Tuberculosis Eradication Coordinator position within the Department of Community Health to work cooperatively with all concerned agencies in implementing the eradication strategy. On February 3, 1998, Governor Engler appointed Former Representative Bob Bender to serve as Bovine Tuberculosis Eradication Coordinator.

On March 12, 1998, Dan Wyant, Director of MDA, signed the Enforced Restriction Area Order, Order No. 1998-01, which orders "Effective May 1, 1998, a person shall not place, deposit, distribute, scatter or tend feed in any area frequented by wild, free-ranging white-tailed deer and elk except that a person may take wild, free-ranging white-tailed deer over bait as defined and authorized by the Natural Resources Commission."

MDA continues to work cooperatively with USDA, DNR, MDCH, MSU, and the livestock industries to eliminate bovine tuberculosis in Michigan. We continue to take the lead in the communications effort, scientific issues, regionalization plans, and protocols for enforcing the wild deer and elk feeding ban.

MICHIGAN ON-TARGET WITH PSEUDORABIES ERADICATION
The Pseudorabies Eradication Program is a national cooperative program between states, the federal government and the pork industry to eliminate the pseudorabies virus (PRV) from the domestic swine population. Pseudorabies is fatal in non-swine species, and decreases growth and reproductive performance in swine. According to a research report published by MSU's Agricultural Experiment Station (The Economic Impact of Pseudorabies on the Michigan Swine Industry in 1993 by James Lloyd, D.V.M., Ph.D., et al) pseudorabies cost Michigan producers $2.4 million in 1993. Dr. Lloyd estimates that, based on figures from this report, PRV cost Michigan over $1.5 million in 1995.

Michigan is in the final steps of the eradication program. Of the 3,000 herds in Michigan, only 10 herds remain under quarantine, all located in Cass and St. Joseph Counties. The goal is to eliminate pseudorabies from the U.S. by the year 2000, which Michigan is expected to accomplish.

To accelerate the state's efforts to eradicate pseudorabies in swine in this state, the Michigan Commission of Agriculture authorized the implementation of the Rapid Rollover Pseudorabies Eradication Program. This program was an incentive to eliminate PRV infected swine and hasten the eradication of the disease and the release of quarantines. The program ended September 30, 1997, and resulted in an approximate savings of $1.5 million to the MDA and several million dollars in improved revenues for the hog industry. Twenty-one hog producers participated in this industry supported program.

EGG QUALITY ASSURANCE PROGRAM LAUNCHED
MDA partnered with Michigan Allied Poultry Industries, Inc. to develop a model for a Michigan Egg Quality Assurance Program. The purpose of a Quality Assurance Program is to help insure the safety of eggs produced by Michigan farmers. This is a HACCP-type tool to control or reduce the spread of Salmonella enteritidis and other bacteria.

The program is called a model because no two Michigan egg farms are alike. Some farms are totally integrated and control all aspects of egg production from chicks through marketing. Other egg farms have cooperative marketing, or sell their eggs to other producers. Some raise pullets for other producers but do not produce eggs themselves. In order to be valid, a model must be flexible enough to be useful to all these situations so that each farm can customize it. This program also acknowledges that a Quality Assurance Program continuously evolves. It should be improved upon as new techniques, technology, and challenges are encountered. A good program takes considerable time and effort to implement, maintain, and improve.

Individual Egg Quality Assurance Programs are developed by individual Michigan producers using the model as a minimum guideline. The role of MDA is to review the program with the producer, and, if approved, maintain a database of those producers and industries who have implemented and maintained a program.

CONTROLLING SHEEP SCRAPIE
Michigan became the first state in the nation to use genetic testing to screen its sheep for scrapie, a transmissible degenerative brain disease, when the Michigan Scrapie Risk Reduction Program

(MSRRP) was initiated in 1997. The program was developed by a committee of producers, scientists and state regulatory officials based on the following objectives: (1) be practical, (2) be flexible, (3) be based on the best available science, (4) be producer friendly, and (5) be effective in reducing the disease. In the United States scientific information on genetic testing and selection for scrapie resistance is limited to black-faced breeds of sheep. Currently, there are nine flocks enrolled in the Michigan Scrapie Risk Reduction Program.

AQUACULTURE PROGRAM TRANSFERRED TO MDA
The enactment of the Michigan Aquaculture Development and Natural Resources and Environmental Protection Act (Public Act No. 199 of 1996), transferred oversight and registration responsibility to MDA from the Michigan Department of Natural Resources. To date, 30 commercial aquaculture registrations have been issued. Oversight responsibilities for private commercial aquaculture facilities are to be transferred to MDA by January 1, 1999.

MDA received confirmation of the presence of Whirling Disease (Myxobolus cerebralis), which affects trout populations, in a private aquaculture facility in October 1997. The Animal Industry Division worked cooperatively with MSU's Animal Health Diagnostic Laboratory to institute the first public aquaculture diagnostic testing for Whirling Disease in Michigan. Since then, 14 private facilities have tested for the presence of the parasite with five facilities testing positive.

Environmental Stewardship Division

Enhancing Michigan's farming operations and commercial land uses with practices that are protective of the environment and public health is at the core of the programs operated by MDA's Environmental Stewardship Division.

INTERCOUNTY DRAIN PROGRAM
The Intercounty Drain Program serves landowners and public corporations within Michigan's intercounty drainage districts which provide storm water conveyance systems ranging from small agricultural drains to urban storm drains. The program is responsible for over 1,000 established intercounty drains and water courses with a combined estimated length of over 10,000 miles.

It provides administrative direction with elected county drain commissioners for intercounty drainage districts. Staff oversees engineering design, conducts construction bid letting financing activity procedures for notes of indebtedness and bonds, and conducts public hearings.

Revising Michigan's Drain Code
Environmental Stewardship staff members are recognized as the state's experts on the Drain Code and related water management issues. They are providing extensive support for the comprehensive review and revision of the Drain Code. This legislation is presently pending in Michigan's Legislature.

1997 Intercounty Drain Projects
For fiscal year 1997 a total of 15 major intercounty drain projects were in various later stages of completion. These projects represent a combined total of 55½ miles of both open channel and pipe drains with an estimated cost of $7.92 million, servicing 170,218 acres of varied land use. An additional 25 major projects were in early procedural stages and requests for petitions to improve 6 to 8 more intercounty drains were being prepared. The maintenance program performed work on 102 drains with an estimated expenditure of $800,000 servicing 1.25 million acres.

IRRIGATION DISTRICT PROGRAM
Public Act 205 of 1967 provides that producers can petition to form irrigation districts utilizing the water from the Great Lakes. An irrigation district can only be used by the agricultural producers of food and fiber commodities. Division staff provide oversight and coordination of agricultural interests and an MDA representative serves as a member of the three-person irrigation board.

The State's first irrigation district, Mud Creek Irrigation District in Huron County, did not operate during the 1997 growing season. Late spring final operation approval from the Michigan Department of Environmental Quality (DEQ), combined with favorable climatic conditions and operational difficulties with the mechanical filters for zebra mussel control resulted in no water being distributed for crop use.

MIGRANT LABOR HOUSING INSPECTION PROGRAM
Migrant workers are hired extensively by Michigan farmers to harvest the labor intensive crops grown in Michigan. Good housing is essential to attracting and keeping that workforce. MDA's Migrant Labor Housing Inspection and Licensing Program, transferred from the Department of Community Health in 1996, is responsible for inspecting and licensing approximately 869 migrant housing sites, including 4,370 living units. The program also administers matching grants to growers for housing projects.

The program is a key component in Michigan's efforts to assure a safe food supply. Assuring safe water supplies, proper toilet facilities, adequate housing facilities, proper food preparation and storage facilities, and proper waste disposal helps see that the workers who handle the food are healthy and free from disease.

During 1997:

.     Inspection and licensing activities resulted in the approval of 4,365 individual living units at 860 locations with a total capacity of 25,482. Staff conducted 1,964 inspections in the licensing of these facilities.
.     At the time of initial inspection, 278 camps were either denied licensure or were issued temporary licenses. Of these, 244 received full licenses after deficiencies were corrected, four received a temporary license to operate for a short time, and the remaining 30 did not operate.
.     Six legal activities and one court case were initiated during the year. The court case was settled by the camp operator pleading guilty. He now plans to establish approved housing prior to the 1998 harvest season.
.     There were 36 complaint investigations. All complaints were thoroughly investigated and follow-up was provided as necessary.

.     A comprehensive water sampling study for numerous contaminants was conducted under a special Environmental Protection Agency (EPA) grant. The study involved 75 wells which were sampled for each of the parameters listed in the normal Safe Drinking Water Act test analytes. Testing was also conducted for glyphosatte, copper, diquat and endothal.
.     The construction grant program provides financial assistance to migrant farm worker housing providers for improving and building new migrant housing. For FY 97, there was $300,000 available for grants. The total costs for new housing and improvements to existing housing were $1,650,639. There were 55 projects funded through the grant programs including the construction of 81 new living units and improvements to 67 others. Improvements were made in electrical service, plumbing, heating, wells, sewage systems, and other miscellaneous areas.

CRANBERRY PROGRAM
Cranberry farming practices, which provide general technical and regulatory guidelines for growers, will help Michigan restore a cranberry industry that faltered at the turn of the century. When it approved and issued the practices in 1996, the Michigan Commission of Agriculture endorsed the redevelopment of the industry to capture part of the growing cranberry market in the U.S.

Cranberries are a high value ($15,000/acre) crop and national demand is not being met. There is a desire to bring more acres into production. The establishment of cranberry beds is environmentally sensitive and expensive. The state wants to assist growers in the evaluation of potential sites to minimize cost and maximize environmental sensitivity.

The program manager within the Environmental Stewardship Division coordinates and is the principle contact for the department's "Cranberry Technical Team." The coordinator brings members of an interagency team from MDA, Michigan Department of Environmental Quality, MSU Extension, and the United States Department of Agriculture-Natural Resources Conservation Service (USDA-NRCS) to visit sites as requested by potential growers. The sites are reviewed for water quantity, soils, and required permits. An inspection report is compiled and shared with the grower and inspection team members. A graphic information system (GIS) is being developed to assist in the identification of potential cranberry sites using soil surveys. (See more about this initiative under "Office of Agricultural Development".)

SOIL CONSERVATION DISTRICT PROGRAM
The department provides program direction, oversight and assistance to Michigan's 82 Conservation Districts. The department administers over $3.5 million in state and federal grants to Conservation Districts.

Through Conservation Districts, MDA seeks to identify local resource needs, then to develop and implement programs to address those needs. Because of the local nature and leadership of Conservation Districts, they serve as an excellent vehicle for the delivery of programs for the department. Programs that focus on groundwater stewardship, private forestry assistance and energy conservation are prime examples.

Some specific program accomplishments for 1997 include:

.     The Energy Conservation Program reached over 500,000 people statewide. Farmers implemented energy conservation practices on 24,000 acres which resulted in an energy use savings of $2 million, an 8 to 1 return on investment.
.     Conservation Districts assisted in establishment of over 260,000 acres of Conservation Reserve Program where blocks of land are set aside in conservation areas for a period of 10 years.
.     Wetland Reserve Program which establishes permanent conservation easements for the protection of wetlands and has, with the help of Conservation Districts, established over 7,000 acres of wetland areas.
.     Conservation tillage acreage is up a total of 142,282 acres from last year. Michigan now uses conservation tillage on approximately half of all acres farmed. Helping farmers and others to become stewards of the land is the fundamental mission of Conservation Districts.

Soil Survey
Division staff members are currently working in cooperation with the USDA-NCRS staff to complete surveys in Alpena and Manistee Counties. MDA staff will also work with NRCS staff on a statewide basis to update, interpret and complete the state soil survey.

In addition, the staff is currently using resources from a Federal Emergency Management Agency (FEMA) grant to take existing surveys for eight counties in south Michigan which are in book format and re-editing them into digital data for use with a Geographic Information System (GIS).

FORESTRY ASSISTANCE AND FOREST STEWARDSHIP PROGRAMS
The Forestry Assistance Program (FAP) is a partnership between the MDA Environmental Stewardship Division , Michigan Department of Natural Resources (DNR) Forest Management Division, and Soil Conservation Districts to provide information and technical assistance on resource management to non-industrial private forest landowners and local governments. Specific services include: tree planting, tree care, and forest management advice; wildlife habitat management advice; tree and shrub sales for soil protection, reforestation, and wildlife habitat enhancement; onsite land/resource examination; and, resource management plan preparation.

Currently, FAP provides 23 grants of $30,000 each to two or more cooperating Conservation Districts which employ 25 full-time foresters to serve all or part of 55 Michigan counties.

The Forest Stewardship Program (FSP) is a nationwide program designed to encourage the active management of all resources on non-industrial private forest land. In Michigan, FSP is a cooperative venture involving the USDA Forest Service, DNR Forest Management Division, MDA Environmental Stewardship Division, and Soil Conservation Districts. Federal FSP funds pay up to 75 percent of the cost of the preparation of comprehensive resource management plans prepared through Michigan's Soil Conservation Districts. FSP plans provide information and direction in all aspects of natural resource management for forest and other lands. Moreover, the completion of these plans is a condition for landowners to become eligible to receive additional federal cost-share dollars for the implementation of a wide variety of resource management practices under such programs as the complimentary Stewardship Incentive Program (SIP), Forestry Incentive Program (FIP), and Conservation Reserve Program (CRP).

.     During 1997, Forestry Assistance Program provided assistance to 18,428 landowners and 563 local government agencies. With the help of the locally hired foresters, landowners received over 4.3 million dollars from timber sales on their woodlots. In many instances, landowners received a much larger dollar amount for their timber than they might have received without the assistance of a FAP forester.
.     For 1997, a total of $99,900 was obtained from the U.S. Forest Service through the DNR resulting in the preparation of 252 Forest Stewardship Plans on just over 32,700 acres of private forest land. With federal dollars, landowner contributions, funds reclaimed from previous years, and MDA's match from an existing program, total FSP expenditures through MDA for fiscal year 1997 were $343,879.

PESTICIDE STATE MANAGEMENT PLANS
The Federal Environmental Protection Agency (EPA) is in the process of requiring each state to develop a plan that describes the way in which they will reduce the risks to groundwater associated with the use of Atrazine, Alachlor (Lasso), Metolachlor (Dual), Simazine, and Cyanazine (Bladex). The first step in this process is the creation of a Pesticide State Management Plan (PSMP) that describes the general way in which the state intends to reduce risks. Michigan was the sixth state in the nation to have its generic Pesticide State Management Plan approved by EPA. Program staff have also been very active in working with EPA on the details of the rule that will allow the continued use of PSMP materials in the state.

The PSMP rule is expected to be published in 1998. Close coordination with the resources provided by the Michigan Groundwater Stewardship Program should allow Michigan to continue its national leadership in non-point source pollution prevention.

GROUNDWATER STEWARDSHIP PROGRAM
Although initially envisioned to operate in only 10 to 14 counties, a judicious use of program resources and coordination with the Soil and Water Conservation Districts and the USDA AmeriCorps program has allowed the Michigan Groundwater Stewardship Program (MGSP) to provide direct service to 74 of Michigan's 83 counties. More than 6,500 Farm*A*Syst assessments have been completed, ranking Michigan first among all states in the number of Farm*A*Systs provided and making the MGSP a national leader in voluntary environmental programs. The program has provided support for over 2,600 abandoned well closures, more than 50 pesticide and fertilizer storage and containment areas, thousands of acres of soil nitrate testing, and hundreds of other groundwater stewardship practices. In 1997, the program expanded its services to homeowners and golf course owners.

Spill Response
Through continued direct interaction and promotion with the agricultural community and having demonstrated efficiency and effectiveness of department capabilities, MDA has rebuilt the confidence in the "system" to deal with agrichemical spills. For the third straight year the number of notifications received statewide has doubled.

.     The Spill Response Program responded to a total of 110 reports during fiscal year 1997, representing 438,523 gallons and 17,325 pounds of pesticides, fertilizer and manure, along with nearly 60 tons of impacted soil. The value for these agrichemical products is estimated at $650,000.
.     Through rapid response and land application of recovered materials, it is estimated that nearly $10 million

of professional cleanup costs have been avoided by the agricultural industry.

Groundwater Monitoring
The Groundwater Monitoring Program has been very active in its support of the State Management Plan process; it provides groundwater monitoring resources to local groundwater stewardship teams and private well owners. Staff are currently working on establishing a statewide baseline for private well water quality. Upon completion, the baseline will provide the first statistically significant information on private well water quality available in Michigan.

In 1997, the MDA Groundwater Monitoring Program continued its work on the statewide groundwater quality baseline survey. The program resumed drinking water well screenings, using a portable immunoassay lab at Ag Expo '97. The program also held drinking water well screenings across the state for 16 local Michigan Groundwater Stewardship Programs. In all, over 1,500 screening tests were provided for Michigan well owners.

The program worked with the U.S. Geological Survey in a cooperative study of the effects of urbanization on groundwater quality, and received a grant from the EPA to study drinking water quality at migrant labor camps with public water supplies. The program also supported monitoring studies for research on the effects of different orchard ground covers on groundwater quality, and on the effects of Christmas tree farming on drinking water well quality.

Groundwater Monitoring Summary - FY97

Project	Number of Sites	Number of Samples
Baseline	118	118
Bulk Storage	18	21
ELISA Followup	58	59
Lab Comparison	38	76
Well Replacement	11	29
Lysimeter	26	190
Migrant Labor Camps	73	88
PSMP	8	8
Ongoing Monitoring	15	26
Use Investigation Samples	17	19
USGS Urban Study	29	29
Christmas Tree Study	24	24
Other	19	26
TOTAL	454	713

Clean Sweep
Michigan leads the nation in its efforts to remove old and unwanted pesticides from the farm and home. In 1996, Michigan became the first state to establish permanent collection sites at which farmers and homeowners could drop off old and unused products on a year-around basis. By the end of summer 1998, 11 such sites will be in operation in Michigan, utilizing EPA cost-share dollars, local contributions and the Michigan Groundwater Protection Fund for support.

The program has properly disposed of a half-million pounds of unused and unwanted pesticides since it began in 1988.

Container Recycling
Container recycling efforts have resulted in the environmentally safe recycling of over 376,000 presoaked containers. These efforts have been coordinated with the Michigan Agri-Business Association and Growers Service cooperation.

RIGHT TO FARM PROGRAM
The Right to Farm Program provides Michigan farmers with protection from nuisance lawsuits, provided their farming practices conform with Generally Accepted Agricultural and Management Practices (GAAMPs), developed pursuant to the Michigan Right to Farm Act and approved by the Michigan Commission of Agriculture.

Right to Farm GAAMPs cover five specific areas of agriculture production: manure management and utilization, pesticide utilization and pest control, nutrient utilization, care of farm animals and cranberry production.

MDA staff investigate and resolve environmental and/or nuisance complaints involving farm operations. A majority of the complaints involve water quality concerns, both surface water and groundwater. Other resource concerns include air quality issues, such as odors, flies, dust, noise, etc. MDA works with farmers to explain their rights and responsibilities under the Right to Farm Act, and encourages voluntary conformance with the GAAMPs.

.     In 1997, the Right to Farm Program addressed 125 new complaints.
.     To date this program has responded to approximately 1,250 complaints over the past ten years, and has successfully resolved over 99 percent of them by working with farmers to implement appropriate GAAMPs.

Finance and Technology Division

The businesses processes of the department are administered and facilitated by the Finance and Technology Division. These include accounting, auditing services, budget, procurement, facility management, mail operations as well as technology development and deployment throughout the department. In addition to traditional infrastructure support, this division is also responsible for the operation of the Upper Peninsula State Fair, the administration of county fairs, and producer security for grain dealers.

AUDITS
During 1997, the Finance and Technology Division conducted 191 grain dealer audits with 21 follow-up visits. Some companies were audited frequently as a result of identified problems. There were two insolvencies involving losses to producers during this period.

Twenty-nine (29) county fair audits were performed to assure that state funds were used in an appropriate manner. MDA works with two state fairs and 88 county or local fairs; there are currently five fairs on probation. These fairs were given this status because they could not demonstrate the ability to adequately document the use of state funds and to provide for adequate management control. Most fairs, however, do a very good job administering their programs in compliance with regulations.

The County Fairs and Racing Unit revamped the horse drug detection program at fairs to enable two crews to perform duties rather than one crew to provide broader coverage of the harness racing and animal pulling events at local fairs. MDA was also involved in the revision of three regulations .

The division also provided audit services to the director to provide program performance information on eight internal audit projects, two commodity groups and five special investigations.

BUDGET SECTION
In 1997, the division supported Michigan agriculture by:

.     Facilitating the department's budget process for appropriations of $71.5 million gross and $33.2 million general fund/general purpose.
.     Identifying departmental fixed costs which assisted in the development of allocation scheduling and monitoring.
.     Monitoring simulcast racing revenues which funded many major departmental programs.

.     Determining the savings realized from early retirements and assisting in the redistribution of those savings to key programs.

TECHNOLOGY SERVICES SECTION
The Technology Services Section is responsible for the planning, development, implementation and administration of the department's information technology. This includes automated systems, data communications, computer technology and end user computing. This section administers the

microcomputer-based local and wide-area network, electronically enabling employees to share information, process electronic mail, and communicate through the Internet to the department's agribusiness customers and Michigan's consumers.

Accomplishments for 1997 include completion of Phase 1 of the Information Technology Master Plan Project including development of a design for a corporate database, completion of the Keane study to determine the Year 2000 impact on the department, and the development of the department's implementation strategy plan for the Year 2000 Project.

UPPER PENINSULA STATE FAIR
In 1997, the U.P. State Fair increased the non-fair revenue through new projects, partnerships and initiatives including: Outdoorama, increase rentals, convention and visitor bureau partnership. They have reduced General Fund support by 33 percent, had an increase of self support level to 86 percent with a projected self support level for FY 98-99 at 90 to 92 percent. The new midway contract has a projected increase in revenue of $25,000 to $30,000.

Food and Dairy Division

In April 1997, the Food Division and Dairy Division were consolidated to create the new Food and Dairy Division. The merger places all food, beverage, and dairy laws and regulations into one division. The mission of the new division is to protect the public health by ensuring a safe and wholesome food supply while working to maintain a viable food and dairy industry.

Consumer food safety and product wholesomeness are accomplished through three programs: Food Safety Assurance, Dairy and Food Service Sanitation. These programs are responsible for the regulation of food, beverage, and dairy manufacture, storage, handling and sales. Enforcement is achieved through program licensing, inspections, food and dairy product sampling; and, when necessary, complaint and foodborne illness investigations and corrective actions.

During 1997, the division issued 60,449 licenses and permits including 21,225 for food establishments, 37,264 for restaurants, and 1,960 for dairy products with a value of over $100 million. The division registered 359 brands of bottled water and 532 vending machines.

The division conducted 18,643 routine food safety and risk assessment inspections finding 67,084 violations. A total of 9,320 food and dairy samples were procured with 1,129 violations.

FOOD SAFETY ASSURANCE PROGRAM
Since 1881, Michigan has been a leader in publicly protecting consumers from adulterated food and drink. With the passage of the Comminuted Meat Act in 1952 and the Michigan Food Law in 1968, the Food and Dairy Division has been charged with regulating food processing, product distribution and container labeling. The Food Safety Assurance Program is at the forefront of addressing emerging pathogens and technological developments.

In 1997, the division worked with the newly created Apple Cider Advisory Committee in creating

a set of Good Manufacturing Practices for apple cider and making recommendations to the committee regarding processing and sanitation techniques to further assure food safety.

Seizure of Unusable Food
In 1997, inspectors seized over 3.3 million pounds of food valued at over $6.1 million. Food is generally seized because it is contaminated by chemicals or bacteria, adulterated, damaged by fire, stored in insanitary conditions, misbranded, outdated, processed in unlicensed facilities, or is insect infested among other things.

.     On July 2, 1997, tornadoes passed through the Detroit metropolitan area causing numerous deaths along with substantial property damage and power outages. During the State of Emergency, Region VII inspectors assessed 182 food establishments and issued seizures for over 1.9 million pounds of unwholesome food valued at $3 million.
.     A joint effort was made between the division and the FDA to determine a method to salvage nearly 5,000 pounds of salted anchovies valued at over $10,000. The anchovies were in large, metal cans which exhibited surface rust which would have contaminated the contents upon opening. A joint effort between the division, FDA, and the owner developed a process by which the anchovies could be salvaged.
.     Raccoon meat was seized at a number of retail outlets in Flint and Saginaw. The source was a DNR licensed furbearer in Ogemaw County. The trapper was issued orders to discontinue the distribution of wild game meat from an unlicensed and uninspected facility.

Foodborne Illness Investigations

.     In February and March 1997, nearly 200 cases of Hepatitis A in Calhoun County and 21 cases in Saginaw County were associated with the consumption of Mexican-source strawberries served in public schools. Department staff assisted in the epidemiological investigation and case control studies, and participated with the USDA, FDA and the Michigan Department of Education and other state and local health department efforts to identify the processor and source of the contaminated strawberries. This episode has resulted in numerous lawsuits, congressional hearings, resignation of a company president, and the unusual step by federal agencies to visit several Mexican farms.
.     Studies of at least 90 individuals in the Wayne County area determined that five outbreaks of foodborne illness occurred in late November 1997 at a large hotel in Dearborn. Melons and other fresh-cut fruit were some of the foods having the highest degree of association with the individuals who were ill.
.     Staff from MDA, the Michigan Department of Community Health, local health departments and the Centers for Disease Control (CDC) investigated at least 20 confirmed cases of E. coli 0157:H7 which occurred in several counties throughout Michigan. These were linked to the consumption of alfalfa sprouts. The sources of alfalfa seeds were investigated and traced back to a warehousing operation in Louisville, Kentucky, and seed growers in Washington and Oregon. The Michigan sprout grower was found to operate under acceptable conditions, but the Washington and Oregon seed sources were noted with conditions consistent with E. coli 0157:H7 contamination. This episode resulted in recommendations from the CDC relative to safe seed growing practices, more clear coding of seed sources, and not commingling seed from seed growers.
.     A delicatessen in Oakland County was associated with 43 cases of Hepatitis A. The food most associated with the illnesses was coleslaw prepared on site by the restaurant in 100 pound batches from material and produce purchased offsite.
.     Staff assisted the Saginaw County Health Department in conducting a cohort study of illnesses among students at a parochial school. Over 150 students reported illness after consuming school lunch and snacks served at an evening athletic event. It was determined the school food service personnel prepared

food and subsequently used the kitchen as a common gathering place for unauthorized personnel.

FOOD SERVICE SANITATION SECTION
Since its inception in 1969, the state-local health department coordinated program has defined and licensed food service establishments in Michigan. Michigan's Public Health Code, Public Act 368 of 1978, Part 129, as amended, provides for the administration of the program and the partnership of authority presently utilized by the Michigan Department of Agriculture and 43 local health departments.

Inspection Pilot Program
A pilot program was launched to field test major changes to the Food Service Inspection Program. The department is shifting attention from existing inspection scores, and focusing on the prompt identification and correction of critical violations (deficiencies that present an increased risk of foodborne illness). MDA met with industry and local health department representatives to create a process acceptable to program partners.

The Food Service Sanitation Section evaluated the food service programs of several local health departments, and certified Personnel Field Standardizations and Certifications of 11 local health departments. In addition, staff members were called upon for consultation with 2,000 members of the food service industry and local health departments.

A total of 90 training programs were conducted, including two HACCP seminars (one with local health department personnel and one with members of the food service industry), one regarding local ordinances and codes, eight concerning ventilation, nine referencing plumbing, 60 one-on-one field training with local health department personnel, and 10 plan reviews.

1997 Model Food Code
Food and Dairy Division staff are working to develop a uniform code regarding the regulation of food establishments. The 1997 FDA Model Food Code is currently under consideration. It is anticipated that the completion of the review and legislative process will occur in the year 2000. It will be necessary to have MDA field food scientists and local health department sanitarians trained prior to the implementation of the code. The Food Service Sanitation Section is working to develop the necessary training.

Job Shadowing Project
The Job Shadowing Project was developed and implemented to foster communication and build a team approach in MDA's commitment to protecting the public food supply. The project was named "shadowing" because an MDA retail food/food processing inspector teams up to "shadow" with a food service sanitation inspector and vice versa.

DAIRY SECTION
Through the efforts of the Dairy Section, Michigan consumers are assured the safest and most wholesome milk supply available in the world. Michigan dairy farmers produce about 5.4 billion pounds of milk per year.

By inspecting Michigan's 3,856 dairy farms on a regular basis, the section ensures that all milk produced in the state meets stringent standards. In addition, all fluid milk, cheese, butter, milk powder, and ice cream products are analyzed each year at the department's laboratory to assure that standards are met. The section also protects the public from false labeling of dairy products so consumers can buy with confidence.

.     In 1997, the Dairy Section conducted over 12,000 inspections at 3,856 dairy farms, resulting in 77 permit suspensions due to deficiencies in milk quality.
.     Section personnel conducted 336 tests on industry pasteurization units to assure that all milk products are properly pasteurized. The section's pasteurization specialist also trains industry processing personnel in the proper operation of pasteurization units and the handling of pasteurized products to prevent recontamination.
.     The Dairy Section conducted 300 joint inspections with industry field persons to help improve milk sanitation on farms.
.     In addition, section personnel participated in joint efforts with the dairy industry to improve milk quality and reduce the amount of enforcement activity necessary to achieve acceptable compliance levels. The section also held educational sessions for training industry personnel in safe milk handling and processing techniques, as well as avoidance of drug residues.

Section Monitors for Drug Residues on Milk
The section is responsible for a comprehensive drug residue monitoring program which includes the testing and monitoring of milk for antibiotics and other residues. In 1997, more than 6.6 million pounds of milk were found to contain some drug residues. This milk was not allowed for sale.

Mercury Reduction Pilot Program
MDA, the Michigan Department of Environmental Quality (MDEQ), Michigan State University's Department of Animal Science, Michigan Farm Bureau and dairy industry representatives have been working on a joint program to reduce the use of mercury on Michigan dairy farms.

In the environment, mercury can be converted into methyl mercury, a form which is highly bio- accumulative (which means it can build up in the tissue of certain species of wildlife such as fish). In extremely high concentrations, methyl mercury can cause poisoning resulting in central nervous system, kidney and liver damage. It can impair child development and even cause death. Particularly at risk are unborn children.

A pilot project has been approved for two Michigan counties where MDA will pay the cost of replacing mercury manometers and installing mercury free vacuum gauges on dairy farms located in the pilot area.

This program has achieved widespread support from all areas of the dairy community including the milking equipment manufacturers. Plans to expand the project statewide will be determined by the response we achieve on the two-county pilot.

Human Resources Division

Providing support to department personnel for various program areas is the responsibility of the Human Resources Division. It is responsible for the selection, hiring, and compensation of department employees, as well as administration of employee benefits, position classification, labor relations and training. The division implements programs which ensure equal employment opportunity and equitable representation of all groups within the department's workforce. Programs include recruitment; minority and student programs and career seminars; reasonable accommodation coordination; sexual harassment complaint investigation; health/safety coordination; and, department compliance with the Americans with Disabilities Act (ADA).

EARLY RETIREMENT PROGRAM
The 1997 Early Retirement Program in state government resulted in the retirement of 58 MDA employees between April 1 and May 30. The 58 employees represented 11 percent of the department's workforce. Recruitment and selection activities became a major priority during the latter half of the year to replace key staff lost to early retirement.

CUSTOMER SERVICE ACADEMY
This innovative and exciting partnership continues with the Michigan Department of Environmental Quality (MDEQ) with the goal of improving customer service. The program is being reviewed as a potential model for state government to promote excellence in government, specifically regarding customer service.

STUDENT INTERN PROGRAM
MDA's student intern program continued in 1997 with 33 students working in the department during fiscal year 1997. The program provides meaningful learning experiences for students and gives the department a pool of new talent from which to draw in the future.

MDA TRAINING COUNCIL
The Human Resources Division continues to chair the MDA Training Council, with the goal of assuring that training needs within MDA are met. Accomplishments during 1997 included: streamlining the training request process and the implementation of a department-wide training database to track training taken by individual employees. Dr. Glen Pfau returned twice in 1997 to present his "Effective Executive Speaking" program.

MDA INTRANET
The Human Resources Division and the Finance and Technology Division joined forces to begin implementation of the MDA Intranet. The internal website is now available to Lansing area staff.

EMPLOYEE RECOGNITION PROGRAM
A new employee award, "Employee of the Year", was developed as an expansion of the ongoing Employee Recognition Program. The new award category was implemented in December 1997 in addition to the existing "Commission Award of Excellence". These awards provide a mechanism

to recognize outstanding MDA employees for a job well done.

Laboratory

The Laboratory Division provides scientific and analytical services for the programs of the Michigan Department of Agriculture and other agencies. In addition, the division provides testing and consulting services on a fee basis to Michigan's industry and private citizens.

The Laboratory Division consists of two world-class laboratories: the William C. Geagley Laboratory located on Harrison Road in East Lansing, Michigan and the E. C. Heffron Metrology Laboratory, located in Williamston, Michigan.

The William C. Geagley Laboratory performs more than 300 biological, chemical and physical tests on a routine basis. In 1997, the laboratory performed a total of 522,667 tests on 355,136 samples. The laboratory examines samples of foods, beverages, pesticides, seeds, fertilizers and feeds to verify labels, ensure compliance with state and federal regulations and to guarantee product quality and sanitation.

The laboratory also monitors food and feed for contaminants, tests blood and urine from competing race horses to make sure performance altering drugs are not used, and tests livestock to prevent the spread of infectious diseases. The Motor Fuel Quality section performs octane, alcohol, lead and additional tests to ensure the quality of motor fuel purchased by Michigan citizens.

The E. C. Heffron Laboratory celebrated its grand opening on June 20, 1997. The $2.2 million dollar facility provides ultra precision mass, volume and length calibration certification for Michigan's businesses. In 1997, the lab served more than 180 companies including Ford, General Motors, Bendix, Dow Industries, Eaton Corporation and many small firms who sell to the U.S. military and overseas markets in Japan and Europe. MDA certifies weights and measures for private calibration firms which in turn provide service to these industries.

The Metrology Lab helped to assure traceability to national standards on an estimated $33 billion of products eligible for international trade. The lab also conducts regulatory services, calibrating standards used for enforcement by the Michigan State Police, Treasury and Agriculture Departments and all county road commissions. The lab, and two full-time metrologists, are certified by the National Institute of Standards and Technology (NIST).
The Laboratory Division also houses the Motor Fuel Quality and Weights and Measures Programs. The administrative personnel for these programs are located at the E.C. Heffron Metrology Laboratory while field staff are located throughout the state. The Motor Fuel Quality Program establishes and regulates the sale and quality of motor fuels through licensing, investigation, inspection and sampling to ensure the fuels that consumers buy contain the proper materials and abide by legal standards. The Weights and Measures Program, through the enforcement of applicable laws and regulations, prevents economic fraud and deception by testing, weighing and measuring devices. This ensures that when a product is weighed or measured, it is done accurately.

The Weights and Measures Program developed and/or cosponsored several industry training workshops and outreach initiatives during 1997. The purpose of these activities was to foster greater industry understanding of weights and measures program requirements and to offer assistance in response to issues affecting Michigan industry that have been raised on a local, state, and national level. .

LABORATORY PLAYS KEY ROLE IN PROTECTING FOOD SUPPLY
In 1997, the Laboratory Division along with the Food and Dairy Division, and Pesticide and Plant Pest Management Division (PPPMD), helped ensure a safe and healthy food supply.

.     Lab scientists tested over 6,500 food and dairy samples for pasteurization, drug residues and pathogens such as E. coli, Listeria sp, Salmonella sp, and Staphylococci.
.     Over 900 fruit and vegetable samples were checked for pesticide residues in a partnership effort with USDA and EPA.
.     A partnership was formed with FDA and MSU Extension to explore HAACP principles and their application in the apple cider industry.
.     Food and beverage samples based on consumer complaints were tested for toxic substances, poisons, drugs and foreign materials.
.     Over 200 samples of fish were tested for salt content.

PREVENTING ECONOMIC FRAUD AND DECEPTION
Along with the PPPMD, the Food and Dairy Division, and the Office of the Racing Commissioner the Laboratory Division helped to prevent economic fraud and deception.

.     The lab tested over 12,000 urine and blood samples (collected from horses competing on Michigan's racetracks) for drugs that would affect their performance.
.     Blood and urine samples (collected from livestock competing at Michigan County Fair livestock shows) were checked for drugs as part of Michigan's Program for Quality Animal Shows & Food Safety.
.     Ground meat products and other food and dairy samples were tested for fat, moisture, and protein content.
.     Staff collected and tested over 2,000 motor fuel samples and responded to almost 300 consumer complaints ensuring that drivers received over 4.6 billion gallons of gasoline meeting or exceeding state standards.
.     The lab verified a commercial weighing and measuring accuracy rate of over 90% of the 37,920 devices inspected.
.     Weights and Measures staff ensured that over 85% of the lots containing over 32,000 packages of both consumer and non-consumer commodities contained the stated net content.

SUPPORTING PRODUCTION AGRICULTURE
The division, along with the Pesticide and Plant Pest Management Division (PPPM) and the Animal Industry Division, helped in the growth of production agriculture.

.     In 1997, lab personnel tested over 52,000 porcine serum samples for the presence of pseudorabies disease as part of the departments pseudorabies eradication effort.
.     Serum from livestock was tested to ensure that the animals are disease free and meet state and federal requirements for shipping across county, state and country borders.
.     Over 2,200 feed and fertilizer samples were checked for compliance with labeling.
.     Over 2,200 seed samples were tested for purity and germination.

PROTECTING THE ENVIRONMENT
Along with the PPPM and the Environmental Stewardship Division, as well as EPA, the Laboratory Division helped to protect Michigan's environment in 1997 in a variety of ways.

.     Lab scientists analyzed over 1,500 groundwater samples for nitrates and atrazine.
.     Samples were tested as a part of misuse investigations on applications of pesticides.
.     Seed samples were checked for noxious weed seeds that could be detrimental to Michigan's environment.
.     The department assisted in the implementation of Stage I Vapor Recovery control requirements for lower vapor pressure gasoline sales and distribution in southeast Michigan, preventing an estimated 26.8 tons of emissions per day for a total reduction of over 2,063 tons during the ozone season (June 1 through September 15).
.     Staff audited 1,199 retail gas stations in the ozone attainment area of southeast Michigan, with only one gas station exceeding air quality standards. This excellent record assures that Michigan maintains its attainment status with the National Ambient Air Quality Standards.

LAB RENOVATIONS
In 1997, the Geagley Laboratory continued to prepare for its upcoming major facility renovation. Today's sophisticated analytical and computer equipment requires a controlled environment to assure the reliability of test results as well as the health and safety of lab workers. To meet these standards the Laboratory Division has received special funding from the Michigan legislature for major improvements to the ventilation and mechanical systems of the 40-year old building. An architectural firm has been selected and preliminary planning is in progress. Final plans should be completed in 1998 with construction proceeding throughout 1999.     

Marketing and Communications Division

The Marketing and Communications Division links the former Market Development Division and the Communications and Emergency Management Division. The Emergency Management function remains in this new division, as well as the Benton Harbor Market News.

MARKETING PROGRAM
The Marketing Section serves as a catalyst, coordinator and resource to provide promotional and marketing opportunities for Michigan's food and agriculture industry. The section plays a critical role in marketing, advertising and promoting Michigan's food and agriculture products and in developing markets for these products in the U.S. and abroad. It also oversees the activities of Michigan's 15 legislatively-mandated commodity marketing organizations, assists new commodity programs organize under Public Act 232, and conducts required referenda. In 1997:

.    
Five marketing programs were required to resubmit their programs to members for a continuation vote. The Marketing and Communications Division conducted a continuation referendum for each of the following: Michigan Asparagus Advisory Board, Michigan Dairy Market Program (for "Grade A" milk), Michigan Cherry Promotion and Development Program, Michigan Onion Promotion and Development Program and the Corn Marketing Program of Michigan. These programs, with combined budgets totaling more than $7.8 million annually, were all renewed for an additional five years.

.     Approximately 50,000 1996-97 Farm Market & U-Pick Directories were distributed in Michigan and surrounding states. These directories help promote visits to agriculture-related markets and u-pick operations throughout Michigan.
.     Staff worked with the Michigan Department of Transportation to implement the Tourist Oriented Directional Signs (TODS) Program to boost agricultural tourism in our state.

Helping Michigan Businesses Increase Food and Ag Exports
U.S. food and agricultural exports overall were at record levels in 1997, including $1.2 billion from Michigan companies. MDA played a significant role in helping companies identify new markets and generate sales overseas.

.     Michigan recruited 25 companies to participate in three MDA-sponsored export activities and 23 companies to participate in six activities coordinated by the Mid-America International Agri-Trade Council (MIATCO). Particularly key to Michigan food export efforts was the U.S. Food Export Showcase (USFES) in Chicago in May 1997. Sixteen Michigan companies exhibited at the show, up from six in 1995. Exhibitors sold $2 million in products, a return of $196 on each state dollar spent.
.     Michigan also held a Baked Goods Promotion at the leading Canadian food service show, in which six companies participated. New tariff eliminations under NAFTA have made baked goods a "best prospect" for export to Canada.

Promoting Michigan's Wine Industry
The Marketing Section also houses the Michigan Grape and Wine Industry Council, which provides promotional assistance to Michigan's growing wine industry. In 1997:

.     The program printed and distributed 175,000 Michigan Wine Country publications and 90,000 Michigan wine maps.
.     Staff conducted 24 wine tastings at not-for-profit events, coordinated seven dinners at Michigan restaurants where Michigan wines were featured, assisted at three festivals and taught four college courses regarding the state's wine industry.
.     The Council provided $100,000 in research grants to MSU to conduct horticultural research on wine grape growing.
.     Staff coordinated the State Fair Wine Competition which awarded 25 Gold Medals, 36 Silver Medals and 31 Bronze Medals to Michigan wineries.

COMMUNICATIONS PROGRAM
The Communications Section handles media relations, video and audio services, and the public relations and public information functions for MDA. In addition, it coordinates food safety public information programs and other special events and projects for MDA, including the department's website. This section also serves as the department ombudsman and responds to calls on MDA's Customer Service Hotline.

Food Safety Awareness Campaign
In July 1997, the Communications staff coordinated the kickoff of Michigan's Food Safety Awareness Campaign with the staff of U.S. Senator Spencer Abraham, one of the initiative's key sponsors. Press conferences were held in four Michigan cities. The goal of the campaign was to

provide consumers with basic common sense tips about safe food handling.

Other initiatives included the addition of a food safety section on the department's website, statewide releases issued during September 1997 (which was named "Food Safety Month in Michigan" by Governor Engler), and the distribution of television and radio public service announcements. In addition, a consumer brochure outlining safe food handling tips was produced and widely distributed throughout the state.

Communicating Important News to Consumers and Industry
The Communications staff also assisted the department by quickly relaying important information via the media to consumers and the agriculture industry on a wide variety of topics including: bovine tuberculosis, the potential presence of E coli 0157:H7 in a brand of apple cider, and the discovery of strawberries as the source of an outbreak of Hepatitis A.

MDA Website Expands, Earns Honors
The department's website, designed for the general public and agriculture industry, expanded to include new sections on environmental stewardship, food safety, production agriculture, and Michigan horse racing. The site was named one of the best agriculture sites on the Internet by AgView, a search engine focusing on ag-related sites.
An interactive, educational section aimed at teaching children about Michigan agriculture, called Kidz Korner, debuted in early 1997 and was named one of Yahoo's "Picks of the Day". Yahoo is the world's most popular Internet search engine.

Special Events Highlight Michigan Agriculture
Marketing and Communications Division staff coordinated several special events in 1997 to highlight the quality and diversity of Michigan agriculture. In April 1997, a special reception to celebrate Michigan's aquaculture industry was held at Michigan's first shrimp production operation in Okemos. The Governor joined MDA Director Dan Wyant in a celebration of Farm Market Month in October at Blake's Orchard and Cider Mill in Southeast Michigan.

Staff also assisted in the grand opening celebration of the department's new E.C. Heffron Laboratory in Williamston.

EMERGENCY MANAGEMENT PROGRAM
The Emergency Services Section serves the department and Michigan citizens by protecting the state's food and agriculture resources in times of emergencies or disasters. In 1997, the section also began coordinating the Agricultural Marketing and Bargaining Board, which accredits a bargaining agent to negotiate the sale price of asparagus, processing apples and red tart cherries. Other additions to the section included coordinating Freedom of Information responses and providing support for the Michigan Commission of Agriculture.

Protecting Michigan's Food Supply During Emergencies
Program staff responded to 18 emergency events during the year, including:

.     When chlordane was discovered in animal feed, staff was mobilized over a weekend to collect and analyze hundreds of dairy samples, preventing contamination of animals and assuring the safety of dairy products.
.     Flooding in Ottawa & Allegan Counties mobilized assessment teams for county drain damage, resulting in at least $300,000 of state aid to county drain systems after a Gubernatorial disaster declaration was secured.
.     A serious tornado in the Detroit metro area activated the department's emergency response. Thirteen (13) MDA food inspectors condemned over 2 million pounds of food worth over $3.2 million. A Presidential disaster was declared in the area and the USDA declared 6 primary and 15 contiguous counties as disaster areas, enabling eligible farmers to qualify for low- interest loans.
.     Hail in Kent and Berrien Counties resulted in a USDA agriculture disaster declaration which provided low-interest loans to farmers who suffered crop losses.

Preparing Staff for Emergency Events
The Emergency Management Section conducted two emergency management training sessions for the department's 18 regional and divisional emergency staff and conducted one training session for 14 new radiological emergency monitors. In addition, a 7-member agriculture disaster damage assessment team was established and provided with one day of damage assessment training, followed by a damage assessment exercise.

Geographic Information System software was purchased, providing MDA with the capability to locate 70 to 80% of all dairy farms, cherry and apple orchards and asparagus fields in relation to potential threats.

Agricultural Marketing and Bargaining Board
Staff conducted three board meetings in 1997 and successfully avoided arbitration. Cherry growers opted to leave the program during the year, leaving only apples and asparagus functioning under Public Act 344. Computer programs were upgraded to better account for commodity representation in bargaining agent elections.

Michigan Agricultural Statistics Service

Michigan's Agricultural Statistics Service (MASS), under a formal agreement between the USDA's National Agricultural Statistics Service (NASS) and MDA, is responsible for the official Michigan agricultural database.

MASS conducts surveys to collect data on Michigan agriculture. Forecasts and estimates are prepared on acreage, yield, and production of Michigan's field crops, fruits and vegetables. Crop- weather information is provided during the growing season. Area, production and value of Michigan's floriculture industry are reflected annually. Estimates are also made on the number of head and production of livestock, including equine. MASS also tracks prices for various commodities. Chemical use data collected provides a foundation for meeting Federal Food Quality Protection Act standards. The estimating program also provides information on agricultural land values, farm numbers, land in farms, expenditures and labor.

MASS statisticians annually prepare county estimates of major crop and livestock commodities. A part-time field enumerator staff, located throughout Michigan and employed by the National Association of State Departments of Agriculture (NASDA), assists in the collection of survey data from farmers and agribusinesses.

MICHIGAN ROTATIONAL SURVEYS
In 1997, MASS completed the Michigan Rotational Nursery and Christmas Tree Survey, a complete enumeration of all Michigan nursery and Christmas tree farms. A 16-page bulletin was released with details on the number of farms, acreage, size of operation, field or container grown acreage, and number and acreage by county for nurseries and Christmas trees. Also, species and sales were included for Christmas trees. MASS also started collecting data on the acreage, varieties and root stocks of Michigan fruit crops in the fall of 1997. The results of this Fruit Tree Inventory will be published in the summer of 1998.

TART CHERRY SURVEY
MASS completed the annual mid-June Tart Cherry Objective Measurement Survey in which fruit counts were made on a sample of about 550 tart cherry trees across the state. These data provided current crop production statistics for the Michigan tart cherry industry. The 1997 crop was 225 million pounds, 15 percent above the 1996 crop.

CHERRY INDUSTRY ADMINISTRATIVE BOARD
MASS cooperated with the newly-formed Cherry Industry Administrative Board (CIAB) to administer its new Tart Cherry Diversion Program. NASDA enumerators working through MASS, assisted the CIAB in verifying tart cherry diversions for about 175 operations statewide.

MICHIGAN AGRICULTURAL STATISTICS BULLETIN
A 136-page bulletin was released with details on production, stocks, inventory, disposition, utilization, and prices of Michigan's agricultural inputs and commodities.

CENSUS OF AGRICULTURE
The Census of Agriculture, which is conducted every five years, was transferred in 1997 to USDA from the Department of Commerce. MASS is responsible for the Michigan portion of the 1997 Census of Agriculture. List preparation and public relations activities for this 25th national agricultural census began in late 1997. Questionnaires were mailed to farmers in December. Data collection will continue throughout the first half of 1998 with initial results available in early 1999.

The Office of Racing Commissioner

The Office of Racing Commissioner (ORC) is an independent agency within MDA that regulates pari-mutuel horse racing in Michigan in accordance with the Horse Racing Law of 1995 and rules of the Racing Commissioner.

The commissioner, appointed by the Governor for a fixed, four-year term, prescribes rules, regulations and conditions as provided by law, under which all pari-mutuel horse race meets are conducted within the state. The ORC allocates racing dates; issues track, race meeting and occupational licenses; collects license and track revenues; appoints stewards and veterinarians to represent the state; approves track appointed officials; and, monitors the daily conduct of racing.

The ORC also conducts equine and human drug testing programs; investigates any irregularities in racing, which may lead to formal hearings, administrative disciplinary actions and/or criminal prosecution; and, develops ways to improve and promote horse racing in Michigan.

Last year brought many challenges to Michigan's horse racing industry, including the closure of the Muskegon Race Course in May. Despite the loss of a track, wagering at Michigan's seven remaining pari-mutuel horse race tracks reached an all-time high of over $474.6 million, topping the 1996 record set during the first year of legalized full-card simulcasting in Michigan. This was a 1.5 percent increase over the $467 million wagered in 1996. Total 1997 attendance was slightly over 2 million, a 1.8 percent decrease from the 2.1 million in 1996, when eight tracks were in operation.

As predicted by the Michigan horse industry, the enactment of the Horse Racing Law of 1995 has effectively sustained Michigan's $1.2 billion horse racing industry and helped preserve its 42,300 jobs. In addition to increases in wagering, full-card simulcasting has meant an increase in money for purses. This has led to improved quality of horses competing in live races, and added incentives for Michigan horse owners and breeders to improve the quality and numbers of Michigan-bred horses. A clear example of this has been the 12 percent increase in the number of registered Michigan brood mares from 535 in 1995 to 600 in 1997. Full-card simulcasting has also transformed Michigan tracks into year-round operations, creating full-time jobs where previously only seasonal work was available.

In July 1997, Governor John Engler appointed MDA Director Dan Wyant as the state's acting racing commissioner. Wyant replaced Nelson Westrin, who resigned as racing commissioner to accept an appointment as Executive Director of the Michigan Gaming Control Board.

Office of Agriculture Development

The Office of Agriculture Development (OAD) was created in 1997, bringing together a variety of programs that were previously scattered throughout the department. OAD serves as a catalyst for improving the economic and enviromental sustainability and viability of Michigan's food and agriculture industry.

The office focuses on the expansion of food and agricultural value-added processing, rural development, sustainable agriculture, enhancing production agriculture, rural health issues and promoting the use of composting on farms and in communities.

OAD houses the Rural Development Council of Michigan (RDCM), which is a public/private

partnership whose charge is to develop new, collaborative approaches to enhance the future of rural Michiganians. RDCM is an umbrella organization which continually promotes the membership and active participation of six partner groups: private for-profit and non-profit interests; local, federal and state governments; and, Native American tribes. RDCM is one of 35 state councils that comprise the National Rural Development Partnership.

CLIENT ASSISTANCE ON ENVIRONMENTAL REGULATIONS
In 1997, OAD provided support to a number of food and commodity processing facilities to address environmental management issues. Recommendations were developed from evaluations based on site visits, contact with private sector consultants, state and federal regulatory agencies, related industry sources and community waste management officials. The recommendations provided facilities with streamlined responses and economically feasible options to assist in meeting environmental needs and regulatory responsibilities. Although not directly measurable in terms of dollars saved, the activities increase confidence in state government, reduce client frustration in dealing with regulatory issues, and improve compliance.

CRANBERRY INDUSTRY REDEVELOPMENT
In 1996, MDA and the Michigan Department of Environmental Quality signed a memorandum of agreement to encourage the development of cranberry production in Michigan. Due to the high cost of establishing cranberry beds and the specific nature of cranberry "farming", MDA initiated a unique interagency cranberry technical team with members from MDA, MDEQ, USDA/NRCS. With input from MSU Extension and the Michigan Cranberry Council, the team concept has responded to over a dozen prospective growers and investors, helping them focus on sites that stand a realistic chance of being developed for cranberry production. In addition to identifying possible wetland and other permit concerns, the technical team evaluates soil and water requirements and other parameters. The process allows the grower to determine whether or not a site warrants further assessment by private sector consultants. Feedback from Michigan growers and the Wisconsin cranberry industry, indicates the Michigan approach is highly valued and "on-target".

Throughout 1997, MDA Cranberry Technical Team members assessed nearly 2,000 acres, approximately 1,200 of which have been viable. In spite of the very large "up-front" capital investment, the team assisted two growers in initiating construction of what will be more than 100 acres of cranberry beds. With nearly 150 acres of cranberries planted in Michigan by individual growers, the Muskegon Cranberry Production and Processing Proposal should result in an additional 1,000 acres of cranberry beds being planted as a phased-in development. In September 1997, the Muskegon County Board of Commissioners unanimously approved the Muskegon Cranberry Project and efforts are underway to implement engineering and marketing feasibility studies in early 1998. The Muskegon proposal was developed by CMS Energy, Rural Development Council of Michigan, Michigan Department of Agriculture and Michigan State University Extension.

A cranberry agricultural finance program announcement was made in December 1997 by the USDA's Farm Service Agency (FSA) and supported by both MDA and Michigan Cranberry Council. FSA will make direct and guaranteed loans to eligible family farmers and ranchers, including beginning farmers, to purchase farmland and finance operations for cranberry farms in

Michigan. The bulk of their funds will be for guaranteed loans made and serviced by commercial lenders, such as Farm Credit Services, local banks, savings and loan associations, etc. The direct loan maximum is $200,000 and the guaranteed loan maximum is $400,000.

KALAMAZOO WATER QUALITY TRADING CREDITS PILOT
MDA and a broad list of agency, community and private sector stakeholders are participating in an MDEQ initiative in the Kalamazoo River watershed for establishing a voluntary water quality trading credit pilot program. The project has received over $150,000 in grants and private sector commitments. The voluntary pilot is expected to reduce nutrient loading to the river at a fraction of the cost that would be born by point sources alone. The program's real value comes in that it recognizes the environmental value of partnerships, the power of economic incentives, and demonstrates the value of shared responsibilities.

MICHIGAN PORK ALLIANCE EXPANDS INDUSTRY
The alliance continues to address issues crucial to the growth of a pork production industry. These include land use/zoning, development of a dynamic systems model focusing on the relationship of the producer to the processor, a benchmark study to characterize the industry and changes that occur, and the transfer of knowledge and technology to pork producers. All of these areas directly affect the economic viability of the industry and have environmental, social and political impacts.

MDA SPONSORS ORGANIC HARVEST FESTIVAL
MDA partnered with the Michigan Organic Food and Farm Alliance, Eden Foods, Michigan Land Trustees, Whole Foods Market, and Michigan State University Extension to support the 3rd Annual Harvest Festival held in September 1997. This festival was attended by over 3,000 individuals and created an opportunity for interaction between Michigan organic producers and processors, agricultural agencies and academics, and people interested in eating organic food. An all-organic reception and banquet, tours, speakers, and exhibits highlighted this two-day event.

ENCOURAGING THE ADOPTION OF SUSTAINABLE AGRICULTURE
As a principal member of the K ellogg Foundation-funded Michigan Integrated Food and Farming System (MIFFS) program, MDA continues to take a leadership role in furthering the adoption of sustainable agriculture in Michigan. Fifteen project sites are demonstrating the effectiveness of using community-based, innovative partnerships to address locally identified issues and solve problems. Ranging in scope from farmland protection in northwest Michigan to farming in the city of Detroit, MIFFS and MDA have increased the adoption of more sustainable farming production and processing practices throughout the state. Michigan hosted over 300 people at the national Integrated Food and Farming Systems Network Conference August 2-5, 1997 in Battle Creek. In the future, special emphasis will center on the marketing of these practices and products and on the creation of new value-added cooperatives.

GRANT BOOSTS CHERRY PROCESSING
The City of Hart received a Community Development Block Grant of $735,000 through the Michigan Jobs Commission for Gray & Company's cherry processing operation. The grant will be

supplemented with funds from the company to reconstruct the infrastructure for the waste water treatment system and reduce the level of sugars and salts in the waste water that leaves the plant. The grant will also allow the company to remain in business in Michigan, thereby retaining 110 full-time jobs that otherwise would be lost to the local economy. In addition, an expansion of the company's operations will see 35 new jobs created.

YOPLAIT USA EXPANDS PRODUCTION
Averting a potential loss to the local and state economy, one of the state's long standing food processors, Yoplait USA, has decided not only to remain in Reed City but to expand their yogurt operation. There were two major issues confronting Yoplait - a) A need to expand the current facility to meet increasing demand and update plant equipment; and b) a need to refurbish the waste water treatment system (at the plant and the municipal system of Reed City to accommodate Yoplait's waste stream). Meeting these needs will allow Reed City and Yoplait USA to comply with waste water treatment effluent standards and to receive a permit from the Michigan Department of Environmental Quality. With the assistance of the MDA, Reed City will receive a $2 million Community Development Block Grant from Michigan Jobs Commission to benefit Yoplait USA and six other companies. Combined with additional investment from the company's own financial resources that will yield a total investment over $12.1 million. Three new production lines will be launched in the expanded facility. Included with the infrastructure assistance, Yoplait will add approximately 100 jobs to their operations. With this expansion and job development, Yoplait USA became one of the major agricultural job creators in Michigan.

AG EXPANSION IN THE GRATIOT-MONTCALM RENAISSANCE ZONE (GMRZ)
MSU Extension held agricultural alliance meetings in August 1997 to discuss the feasibility of building a soybean processing plant and other value-added agriculture projects in the GMRZ. Soybean extrusion and expulsion are being studied along with soy oil esterification and refining at a proposed plant by Michigan Farmers Union. A feasibility study is currently being conducted by USDA Rural Development and a key issue is whether or not a critical mass of soybean production can be assembled to justify the processing plant. Other projects discussed included dry beans, potatoes, processed vegetables, aquaculture and corn.

VALUE-ADDED AGRICULTURE CONFERENCES
Over 100 participants attended the first value-added agriculture conference in January, 1997, held in Frankenmuth, Michigan. This was co-sponsored by MDA, Michigan State University, Michigan Farm Bureau, Michigan Soy Bean Promotion Committee and others to learn about the opportunities with grower-owned value-added processing cooperatives.
MDA AND PROJECT GREEEN SUPPORT FOR VALUE-ADDED PROCESSING
In-kind and direct resources were provided by MDA in cooperation with funding by Michigan State University on various Project GREEEN value-added agricultural businesses. These include efforts in Michigan's thumb area to develop a Thumb Oilseeds Producers Cooperative, alfalfa processing plant and aquaculture. In the Gratiot-Montcalm Renaissance Zone (GMRZ) several activities and promotions are underway to attract food processing companies to the area. In addition, MDA and

MSU have agreed to have a long-term economic outlook study performed on the targeted cranberry industry along with preparation of a strategic development plan to be financed by Project GREEEN.

FARMLAND PROTECTION SUCCESS
In June, an Ottawa County Circuit Court Judge ruled in favor of a local turkey farmer, Harley Sietsema, and Allendale Township residents involving the Allendale Township Zoning Ordinance and farmland protection. A developer requested a rezoning of 37 acres of farmland in order to build a residential subdivision that would be adjacent to Sietsema's farm. Township voters in 1995 rejected the zoning change which precipitated a lawsuit by the developer against the township claiming that the agricultural zoning of the property was unreasonable and essentially rendered it valueless. The township called the Executive Director of the Rural Development Council of Michigan and MSU crop and soil scientists to testify on the validity of the zoning ordinance. This case proves that individuals, farmers and the local community have the right to decide what type of development and land use should occur in their township. It is not known whether or not the case will be appealed.

Pesticide and Plant Pest
Management Division

One of MDA's most diverse divisions, the Pesticide and Plant Pest Management Division (PPPMD), is responsible for the implementation of programs and enforcement of laws dealing with agricultural products, plant pests, pesticide management and inspection of fruits and vegetables. The programs are designed to help protect human health and the environment from adverse effects associated with pesticide use.

PESTICIDE SECTION
The pesticide program is responsible for applicator certification and registered technicians, pesticide enforcement, commercial applicator business licensing, federal worker protection programs, federal endangered species, pesticide registration and restricted use pesticide dealer licensing.

Inspection activities include use/misuse complaints, inspection of pesticide producing establishments and marketplaces, monitoring and auditing restricted use pesticide dealer sales, monitoring compliance with state and federal pesticide use regulations, and conducting compliance assurance planned use inspections.

Inspections
PPPMD conducted the following inspections during 1997:

.     Producer establishment inspections: out of 55 inspections, 9 were referred to EPA for enforcement actions.
.     Marketplace inspections: division inspectors conducted 21 federal marketplace inspections (MPI), with a total of 19 samples collected. Two inspections were referred to EPA for enforcement review.
.     Planned use inspections: MDA conducted 78 agricultural and 81 non-agricultural planned use inspections (PUI), for a total of 159. Forty-one (41) agricultural inspections determined compliance with federal

worker protection standards. Fourteen (14) agricultural inspections were completed in conjunction with Section 18 follow-up inspections. Thirty-six (36) inspections were conducted at bulk pesticide storage facilities. Ten of the non-agricultural PUIs were conducted at health care facilities, government facilities or schools focusing on integrated pest management program requirements.
.     Restricted use pesticide dealer audits: 142 restricted use pesticide dealer audits were conducted with 35 resulting in enforcement actions.
Enforcement Activities
A total of 458 pesticide use investigations were conducted in fiscal year 1997. Of these, 199 were agricultural and 259 were non-agricultural. Investigators discovered 127 violations grouped in the following categories:

.     Licensing
.     Pesticide applicator certification/registration
.     Use of personal protective equipment
.     Product use, including drift, misapplication, contamination, improper disposal and spill remediation
.     Vehicle violations, including spill kits, vehicle identification and spill pads
.     Documentation, including improper records, client paperwork, consent to services, notification and posting

Insect and Rodent Control Program
In 1997, the insect and rodent management program continued the Eastern Equine Encephalitis (EEE) program through a mosquito larvae surveillance program. This program is aimed at monitoring mosquito populations, species and the presence of EEE, a serious disease, which threatens both humans and horses in Michigan. One human death in Saginaw County in August 1997 was attributed to EEE.

In addition, the Lyme disease testing and tick identification program was continued in 1997. Lyme disease program activities included public education, tick testing for Lyme disease, site inspection and consultation with local health departments.

The insect and rodent management program staff also worked extensively on other programs such as swimmers itch, mosquito control, gypsy moth surveillance and control, and rodent control at cider mills.

Integrated Pest Management
The MDA Integrated Pest Management (IPM) Program was developed to assist pesticide applicators comply with the law and promote the use of equally effective alternative pest control methods. Regulation 637, Pesticide Use, Rule 14 requires that a pesticide applicator participate in an IPM training program and have an IPM program in place for the building before any pesticide applications are made in schools, public buildings and health care facilities.

In fiscal year 1997, MDA cooperated with the Michigan Pest Control Association to provide a free opportunity for employees of schools, public buildings and health care facilities to attend an approved IPM training program. During 1997, 15 seminars were conducted involving 528 participants including 34 medical professionals, 479 school professionals and 15 building professionals.

Pesticide Registration
Approximately 12,000 pesticides were registered with the State of Michigan for the period ending June 30, 1997.

Section 18 of FIFRA (Federal Insecticide, Fungicide and Rodenticide Act) allows states to request approval from EPA to use a pesticide not specifically labeled for that use to control an emergency pest problem within the state. MDA evaluates the situation to see if it meets Section 18 criteria, and if so, works with MSU Extension specialists to develop the request. In 1997, MDA compiled and submitted nine Section 18 exemption requests to EPA. All nine of the Section 18 requests were granted. The requests provided a benefit to Michigan producers, increasing crop production by over $66 million.

Certification and Recertification Programs
Currently, there are over 28,000 pesticide applicators that are either certified or registered by MDA. This number reflects 13,227 private and 12,832 commercial certified applicators and 1,995 registered applicators. In 1997, MDA administered a total of 16,175 pesticide applicator exams to private, commercial and registered applicators.

Certified or registered applicators may renew their credentials by exam or attendance at approved recertification seminars. In 1997, MDA approved 878 seminars under the recertification by seminar program. The popularity of the recertification by seminar program has increased considerably since its implementation in 1989. In 1997, 1,556 applicators renewed their credentials in this manner.

The applicator certification program complies with federal requirements, allowing 66,000 restricted use pesticide sales in 1997.

Protecting Food Safety through Farm Gate Sampling
In 1997, MDA continued its annual farm gate sampling program to test fresh commodities for the presence of pesticides. PPPMD inspectors sample Michigan farm produce at the farm gate to determine levels of pesticide residues on raw agricultural commodities and take appropriate enforcement action if detected residues exceed tolerance or occur in situations where no tolerance exists. In rare situations where pesticide residues exceed tolerances, the Pesticide Section works with the MDA's Food and Dairy Division to conduct cooperative enforcement action.

In fiscal year 1997, MDA sampled nine commodities, collecting 161 samples. The commodities included blueberries, tomatoes, bell peppers, cabbage, carrots, apples, grapes and potatoes. All samples were collected at random by MDA inspectors from roadside stands and farmers markets.

All 161 samples were analyzed using two multi-residue methods. Eighty-six (53 percent) of the samples had no detectable pesticide residues. Seventy-one (44 percent) had detectable levels of one or more pesticides but at levels below EPA's established acceptable limits. Four samples (3 percent) had pesticide residues that were not labeled for the sampled commodity. Investigations showed problems with drift from areas being properly treated and not following rinsing recommendations following multiple pesticide uses.

PLANT INDUSTRY SECTION
The Plant Industry Section activities involve three distinct groups: Agricultural Products Quality Assurance, Plant Pest, and Fruit and Vegetable Inspection Program.

The Agricultural Products Quality Assurance programs include feed, animal remedies, fertilizer and liming materials, and seed enforcement. Activities include: reviewing product labels, inspecting and licensing manufacturers, and sampling products for laboratory analysis to insure that product content agrees with label claims.

The Plant Pest Programs include nursery, gypsy moth, apiary, and plant pathology activities and are responsible for certification of commodities for foreign export; pest monitoring and quarantine; gypsy moth suppression and eradication; virus free certification of fruit stock; biological control of pests; and, biotechnology.

The Fruit and Vegetable Inspection Program is responsible for the inspection and grading of produce to insure that the size and quality is as advertised in the marketplace, at processing facilities, and shipping points.

AGRICULTURAL PRODUCTS PROGRAM
Commercial Feed Program
Michigan's meat, milk, egg, fish and pelt industries bring approximately $1.4 billion in annual revenue to the state, while their producers spend approximately $362 million for livestock feed. In addition, Michigan pet owners spend approximately $171 million annually on dog food and another $125 million on cat food for approximately 1.7 million dogs and 1.8 million cats.

The primary goal of Michigan's Commercial Feed Program is to safeguard human and animal health. This is accomplished through the inspection of commercial feed products and the processes involved in their production, distribution and storage. Because therapeutic and production drugs are often administered via commercial feeds, MDA closely monitors the manufacture of these products for compliance with current good manufacturing practice regulations designed to prevent unsafe drug residues in human food. In addition, reports of animal deaths or illnesses where feed may be implicated are investigated promptly. This insures that necessary actions to protect the food supply are swiftly undertaken when warranted.

Another important goal of this program is to protect the feed industry from unfair competition, and both consumers and industry from deceptive practices. False or misleading product claims can affect not only animals and their owners, but honest and reputable manufacturers as well. During 1997:

.     1,048 commercial feed manufacturer/distributor licenses were issued
.     Plant Industry inspectors conducted 1,357 feed inspections
.     2,046 samples of commercial feeds were collected and analyzed between July 1, 1996 and September 30, 1997, including 87 corn and 283 wheat samples tested for vomitoxin and other mycotoxins. 73 samples of wheat grown in 1996 exceeded maximum FDA mycotoxin guidance levels for use in feed. Of the feed samples tested, 86 percent met all declared guarantees.
.     529 violations cited as a result of inspection and sampling efforts resulted in the removal of $649,290

worth of unsuitable or misbranded feeds.
.     200 inspections were conducted at 120 medicated feed manufacturing facilities to determine compliance with good manufacturing practice regulations, including 7 FDA-registered establishments that were inspected by PPPMD inspectors holding FDA credentials.
.     In January, animal by-products, produced by a Wisconsin firm and used as feed ingredients, were intentionally contaminated with the pesticide chlordane, by a yet unidentified person. MDA's rapid response prevented widespread contamination of dairy products, eggs, meat, and additional feed products.
.     A new federal regulation banning the use of mammalian-derived protein from use in feeds for ruminant animals went into effect in August. The purpose of the regulation is to prevent the establishment and amplification of bovine spongiform encephalopathy (BSE) if it should be discovered in the U.S. MDA is taking an active role in educating the industry and assuring compliance with the ban.

Animal Remedy Program
The Animal Remedy Program is designed to provide assurance that animal drugs and vaccines used in both food producing and companion animals are properly labeled and safe for their intended use. By determining that all remedies are licensed and reviewing product labels, PPPMD insures that illegal and unsafe drugs are not available to food producing animals. These efforts play a key role in preventing contamination of the human food supply.

.     Last year, 1,377 animal remedy products licenses were issued to 122 companies
.     Five animal remedy product licenses were denied or revoked due to unresolved safety concerns about the products.
.     Plant Industry inspectors made a total of 209 inspections looking for unlicensed or misbranded remedies, reporting 116 violations and removing $29,691 worth of violative products from sale.

Grain Elevator Sanitation Program
The Grain Elevator Sanitation Program helps to assure that food grains are safe, wholesome, and free of contamination, and prevents the loss of grain and animal feeds to pests. This program indirectly helps to keep insurance rates low for the Michigan grain industry estimated to be valued at over $1.5 billion. There are approximately 270 grain elevators in the state, storing approximately 200 million bushels of grain and beans.

.     In 1997, Plant Industry inspectors made a total of 622 inspections to look for insanitary conditions in 367 (74 percent) of 494 grain elevators, feed mills and feed dealers. They reported 6 violations, removing from sale $2,860 worth of unfit grain.
.     In order to improve compliance, 13 warning letters were sent to companies which failed to correct insanitary conditions in a timely manner. Hearings were conducted with another 2 companies having significant compliance failure rates. Staff in west Michigan organized a grain elevator and feed mill sanitation workshop in April to explain MDA's sanitation requirements and the importance of inspection. Thirty-one (31) firms with unacceptable inspection histories were given the opportunity to attend as an alternative to direct enforcement action.

Plant Food Program
The Plant Food Program regulates the manufacture, distribution, sale, labeling and advertising of fertilizers, soil conditioners, and liming materials. Regulatory activities in this program assure the citizens of Michigan that these products are safe for their intended use and meet the label guarantees.

This program regulates over 700 manufacturers and distributors of over 1.4 million tons of fertilizer and liming materials for both agricultural and non-agricultural uses. Approximately 52,000 farms in Michigan utilize 10.5 million acres of land to produce approximately $2 billion worth of field crops for food and livestock feed. Michigan farmers and residents of the state rely on this quality assurance and consumer protection program to maximize yields and maintain a profitable farm operation. In addition, millions of state residents depend on this program to protect them from fraud when purchasing fertilizer for home and garden use.

.     In 1997, division field staff conducted 359 inspections and collected 755 samples resulting in 140 violations. This represents a violation rate of 18 percent, down 2 percent from last year, meaning that 18 percent of the products inspected by PPPMD field staff were in violation of Michigan law. The value of these products was $635,506.
.     The number of licenses to manufacture or distribute fertilizer increased by 35 to 436.
.     The number of specialty products (fertilizers and soil conditioners) registered for sale in Michigan increased by 624 to 3,363. The number of liming materials licensed for sale increased by 13 to 109.
.     The total amount of fertilizer distributed in Michigan was reported at over 1.4 million pounds.

Seed Program
This program serves more than 600 seed labelers who process and distribute approximately 170,000 tons of agricultural and non-agricultural seed annually in Michigan. Approximately 52,000 farmers, who produce an estimated two billion worth of food and feed, also benefit from this program. Consumers depend on this program to ensure that the seed they purchase for lawn and garden use is of reliable quality. Through routine seed sampling, inspectors are able to intercept violative seed products before they reach buyers.

.     During 1997, inspectors conducted 839 inspections and collected 1,558 seed samples.
.     347 violations were reported and over $2.3 million worth of violative products were removed from sale.

This program also has the responsibility to oversee the certification of seed. The seed certification program, operated by the Michigan Crop Improvement Association, provides a system for bringing high quality seed of outstanding field crop varieties to farmers and seedsmen. This certification concept is based on varietal purity, which is comparable to pedigree in animals. It promotes seed with the genetic potential to produce high crop yields. In addition, this program oversees the genetic purity, and adherence to mechanical standards for sale and distribution of seed potatoes for both domestic and international markets.

FRUIT AND VEGETABLE INSPECTION PROGRAM
The Fruit and Vegetable Inspection Program (F&V) offers grading and verification of produce using government standards and/or processor specifications. It provides growers, shippers, packers, processors and brokers with an unbiased, third-party inspection service. With the exception of federal programs and exports, this program is voluntary. During 1997:

.     Inspectors conducted 2,593 shipping point inspections, assuring that the produce met the grade marked. USDA grades are used nationwide to buy and sell produce.
.     Staff conducted inspections on 1,674 lots of produce and issued 1,225 certificates on produce coming from other states or countries.

.     The value of the wholesale produce inspected totaled over $233.6 million. The value of produce failing to meet the USDA standards or buyer specifications totaled over $4.9 million.
.     F&V inspectors issued 24,488 certificates on over 440 million pounds of produce destined for processing. Michigan's processing season begins in June and finishes in late November. F&V inspected the following pounds of produce for processing: 140,349,001 apples; 4,790,980 blueberries; 6,030,140 cabbage; 141,055,164 cherries; 89,857,376 grapes; 4,695,000 peppers; 51,445,558 potatoes; 2,000,130 tomatoes; and, 242,750 miscellaneous vegetables.
.     164 controlled atmosphere (CA) storage rooms containing 123,132,840 pounds of apples were inspected, sealed and licensed.
.     Michigan produced approximately 2,600 acres of seed potatoes. F&V staff inspected 28,759,000 pounds and issued approximately 650 certificates for seed potatoes prior to shipment as part of the certification process.
.     The F&V program served over 315 clients who received produce from several thousand growers. F&V inspectors inspected 774,984,157 pounds of produce.

Wholesale Potato Dealer's Program
This program became part of the F&V Inspection program in May 1997. It is designed to protect Michigan farmers from losses due to a wholesale potato dealer's failure to pay for potatoes purchased. All dealers who are licensed are required to post a bond or letter of credit with the department. Thirty-six (36) wholesale potato dealers were licensed during 1997. F&V staff resolved two farmer complaints against a wholesale potato dealer for failure to pay during 1997.

PLANT PEST PROGRAMS
Nursery Program
Michigan grown nursery stock and Christmas tree shipments continue to be gypsy moth free. However, due to a 10-fold increase in the number of acres defoliated by gypsy moth, the certification of nursery stock and Christmas trees continued to be a challenge for MDA and the nursery and Christmas tree industries.

Nursery Inspections and Licensing - FY97

Licensing

Total Licenses Issued	6,819
General Nursery Licenses	1,486
Plant Grower Licenses	506
Total # Growers Licensed	1,992
Dealer in Nursery Stock Licenses	4,155
Plant Dealer Licenses	672
Total # Dealers Licensed	4,827

Inspections

Acres of Hardy Nursery Stock Inspected	10,677
Acres of Perennials Inspected	898
Total # of Acres Inspected	11,575
Nursery Inspections	3,824
Nursery Dealer Inspections	379
Interstate Inspections	742
Quarantine Inspections	269
Export Inspections	3,231
Total Inspections	8,445

Pine Shoot Beetle
Since the detection of Pine Shoot Beetle (PSB) in 1992 in Michigan, MDA has been conducting annual surveys to facilitate the movement of nursery stock and Christmas trees in compliance with the Federal Pine Shoot Beetle Quarantine. The number of counties infested with Pine Shoot Beetle continued to increase, with a current total of 65 counties. The addition of 13 counties to the PSB quarantined area now requires a more intensive inspection of pine nursery stock and Christmas trees to allow their movement to PSB non-quarantined areas. An alternate plan was also developed to allow for the intrastate movement of pine logs from quarantined areas to mills in non-quarantined areas. Under this plan, micro-regulated areas were created around the mills to minimize the negative impact of the quarantine while facilitating year round movement of commodities. The following efforts were made in 1997 to control this pest:

.     Survey of 112 sites located in 19 counties in the lower peninsula to monitor the distribution of PSB.
.     Implementation of the PSB Compliance Management Plan for the Christmas tree growers, with about 80 growers initially participating in the plan.

Export Programs
The demand for phytosanitary export inspections continues to grow. The accreditation by the USDA of additional staff as well as the availability of EXCERPT on laptop computers has enabled the division to provide this essential and critical service to the exporters of Michigan grown commodities in an efficient and timely manner.

Export Program Accomplishments in 1997

Export Commodity	Amount Inspected
Beans, Peas, Corn, etc.	91,951,165 lbs.*
Bulbs, Corn	3,214,840 lbs.
Lumber	2,843,148 bd. ft.
Seeds	21,743,823 lbs.
Nursery Stock	340,386 pieces*
Non-Hardy Plants	218,615 pieces
Vegetables	2,014,365 lbs.
Fruits	12,928,591 lbs.*
Hay	1,152 tons
Cut-flowers	34,563 pieces

*1996 data

Plant Pathology

Apple Exports to Brazil
Last year marked the second year of involvement by MDA in implementation of a systematic certification process to facilitate the movement of apples into Brazil. This was a cooperative effort between MDA, USDA, MSU and the Michigan Apple Committee. The acceptance of this protocol by Brazil opened a 5 million dollar market for Michigan apples, resulting in higher values for apples, in general, and increased profits for producers.

Karnal Bunt
The small grain disease, Karnal bunt, was detected in Arizona, California and Texas in 1996, causing USDA to develop a national survey to substantiate freedom from this disease in individual states facilitating international trade of U.S. wheat and wheat products. In 1997, the national survey covered those wheat-growing areas of the U.S. where Karnal bunt has not been detected. MDA cooperated in this survey, collecting 182 samples from grain storage elevators and seed production facilities in the wheat producing counties. The USDA Laboratory in Niles, Michigan analyzed the samples, which all tested negative for the disease.

Virus-Free Program
PPPMD has been actively involved in improving the quality of pome and stone fruit trees in Michigan. This program is established at Hilltop Nurseries, Inc. in Hart, Michigan. The nursery maintains 14,000 fruit trees in four scionwood blocks for certification of budwood for virus-free status. This year the nursery was able to market 1.3 million trees.

PPPMD has also started offering virus-free certification of blueberry plants to help growers obtain disease-free vigorous plants for export and planting. Under this program, PPPMD tested over

200,000 blueberry plants for plant viruses.

Import Permits
To facilitate introduction of foreign genetic material to improve the quality of fruit trees and landscape material, PPPMD authorized ten permits to import 142,765 plants (malus, acer, rose, hydrangea, and hibiscus) under the post-entry quarantine program. In 1997, the division released 308,799 trees of malus, salix, and hydrangea shrubs that were imported in 1995 under 13 permits after an intensive screening for exotic pests. At present there are 270,472 trees under quarantine.

MDA reviewed 26 plant pest permit requests for importation of 89 micro-organisms, plant pests, insects and biocontrol agents for research, exhibition, and integrated pest management for 8 countries and 15 states. USDA approved 17 permits and 62 organisms. Currently, there are 27 organisms under review by USDA and PPPMD denied importation of 27 species due to environmental restrictions.

Seed Corn
In 1997, four seed companies submitted 7,668 acres of seed corn for phytosanitary certification. PPPMD inspected 95 fields for bacterial, fungal and virus diseases. Ten corn fields representing 30 acres were infected with Stewart's Wilt, Erwinia stewartii, and seven fields representing 25 acres contained Goss' wilt and were denied certification.

Soybean Cyst Nematode
PPPMD is in the third year of soybean cyst nematode (SCN) survey for nurseries and seed potato growers to facilitate certification. In 1997, MDA collected 86 samples from 57 nurseries in 39 counties representing 3,982 acres in Michigan. None of the nurseries were infested with SCN or Golden Cyst Nematodes.

Gypsy Moth Program
Gypsy moths continue to be the most serious plant pests in Michigan. Their presence impacts wood fiber production, makes it more difficult to export Christmas trees, and creates a nuisance for homeowners.

Cooperative Gypsy Moth Suppression Project
There are three main goals in the Michigan Cooperative Gypsy Moth Suppression Project. First, the protection of trees for aesthetic and wood fiber production purposes. Second, the reduction of larval numbers in residential and recreational areas so citizens can enjoy Michigan's summer. Third, to reduce the improper use of pesticides for gypsy moth control.

In June 1997, approximately 24,000 acres in nine Lower Peninsula counties were treated as a part of the voluntary gypsy moth suppression program. MDA provided oversight and direction for this cooperative program which is supported by the U.S. Forest Service and local funds. The counties involved in the program included: Bay, Gladwin, Iosco, Livingston, Macomb, Montmorency, Oakland, Roscommon and Wayne. This program, which is meant to provide relief to residents in heavily infested areas, protected shade trees and landscapes valued at $5.8 million and more than 11,000 homes in 1997. The treatment also protected parks and recreational areas that receive nearly

1.4 million visitors each year.

The defoliation trend in Michigan has been one of decline since its high of 712,000 acres in 1992. In 1996, defoliation involved approximately 3,200 acres. However, this trend changed in 1997 when nearly 39,000 acres were defoliated.

Some increase in defoliation acres is expected as gypsy moth moves into new areas. This new expansion is now occurring across the southern four tiers of counties from the metropolitan Detroit area toward Jackson.

Slow-the-Spread (STS) Project
Gypsy moth continues to spread to new areas both in Michigan and other states. Though stopping this spread is currently impractical, slowing the rate of spread is possible. The value of forest land protected due to a delayed spread totaled 7 million dollars including the value of timber for paper pulp.

The STS project has demonstrated that average spread can be slowed from 13 to 3 miles per year. This program is expected to become operational nationally in 1999 along the leading edge of Gypsy Moth infestation from the Atlantic coast states through Wisconsin and Michigan.

Urban Pesticide Initiatives
In response to illegal pesticide sales and distribution in metropolitan urban communities, MDA initiated several long-term projects in 1997 to provide education to urban residents on the safe use of pesticides and the concerns related to using illegal pesticides which pose a risk to human health and the environment.

A coalition of industry representatives, MDA, and MSU developed educational materials and non- traditional communication strategies to reach the affected communities.

In addition, MDA instituted a structured inspection program targeting the communities at risk to focus on uncertified and unlicensed applicators, surveillance of businesses supplying these communities with pesticides, and development of educational programs targeting students and parents in inner city schools.

Food Quality Protection Act
The federal Food Quality Protection Act (FQPA) became effective in August 1996. The FQPA established new provisions for determining pesticide residue tolerances on agricultural commodities in an effort to increase safety standards for humans, especially children.

While the FQPA creates goals common for all citizens, the implementation of the new tolerance assessments may have a drastic impact on the production of minor crops with few registered pesticides for controlling insects and diseases. The potential exists for minor crops to lose many available alternatives, reducing the ability to implement integrated pest management and pest resistance management programs.

MDA has been working cooperatively with MSU and EPA to collect pesticide use information and analyze crops for pesticide residues in both raw and processed food products. This data is critical to fill data gaps in the EPA tolerance assessment process. The cooperative program will also develop information on alternatives available and provide this information to EPA and producers for use in controlling pests where pesticides have been lost due to FQPA tolerance revocations.

The FQPA established a ten-year timeline for assessing all food tolerances, establishing the need for MDA to remain active in data collection and the development process for alternatives.

MDA Responds to Potato Late Blight Concern
Potato late blight, if allowed to flourish, can be a potato crop's most damaging disease. The incidence of this disease has increased in Michigan due to widespread occurrence of new strains of late blight which are insensitive to Ridomil, the only systemic fungicide registered for this use. MDA responded to the needs of the Michigan potato industry by working with MSU Extension to successfully petition the EPA for emergency use of three fungicides to combat this disease. In addition, due to disease concerns associated with abandoned potato fields, MDA in cooperation with MSU and the Michigan Potato Industry Commission developed an educational program to convince farmers to dispose of potatoes in abandoned fields and cull piles. Through the emergency use of fungicides and this sanitation program, Michigan potato producers were able to keep this critical disease under control during the 1997 growing season.

Federal Potato Diversion Program
Michigan potato growers participated in the 1997 federal potato diversion program. The diversion was initiated in 15 states due to the surplus number of potatoes still held in storage as of May 1997. All potatoes diverted required USDA/MDA inspection to qualify and MDA inspected approximately 181,990 hundredweight of Michigan potatoes for the diversion program. After inspection, the potatoes were sent for livestock feed or charity feeding programs. MDA waived fees for travel time and mileage in order to encourage farmers to participate regardless of their location as well as to help prevent the spread of disease from potatoes left in cull piles at the farms.

Bovine Spongiform Encephalopathy
A federal ban went into effect in 1997 prohibiting rendered protein products derived from mammals from being used in feed for beef and dairy cattle and other ruminant animals. The FDA took the action to protect U.S. cattle herds from the establishment and amplification of bovine spongiform encephalopathy (BSE), which has been reported in Europe, but never detected in the U.S. Scientists believe there may be a link between BSE and a variant form of Creutzfeldt-Jakob disease, which is fatal to humans.

To better educate regional feed and rendering industries about the complexities of the new rule and to prepare its staff to be equipped to ensure compliance, MDA coordinated and hosted a training program in which FDA explained all aspects of the rule and its impacts to state and federal inspectors. Inspectors from the neighboring states of Ohio and Indiana joined Michigan's staff in receiving this valuable training.

Conclusion
People are often surprised to learn how broad MDA's responsibilities are, and what a key role the department plays in the lives of every Michigan citizen. In addition, the department supports and strengthens Michigan agriculture, the state's second largest industry, and protects the state's food supply.

This report has detailed not only the significant accomplishments of the department during 1997, but has outlined the daily activities of each division during that year.

We hope you have found it informative and helpful. For more information about the Michigan Department of Agriculture, write: P.O. Box 30017, Lansing, Michigan, 48909, or visit our World Wide Website at http://www.mda.state.mi.us.