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Dorr denies cheating government on farm subsidies

WASHINGTON (AP) -- The future of a top Agriculture Department nominee is in doubt after he acknowledged that his Iowa farm was once forced to repay $17,000 in subsidies to the government.

Thomas Dorr, President Bush's pick to become the department's undersecretary for rural development, denied any wrongdoing. He told a Senate committee Wednesday he regretted tape-recorded comments where he told a brother the government could "raise hell with us."

Senate Agriculture Committee Chairman Tom Harkin, D-Iowa, told Dorr there was "a lot of concern about your nomination" and questioned his commitment to government spending on rural development. Harkin said the committee would meet privately later to discuss an Agriculture Department investigation of Dorr.

Dorr's chief supporter in the Senate, Charles Grassley, R-Iowa, told reporters he did not know whether there was enough support on the committee to approve the nomination.

The farmer from Marcus, Iowa, already was under fire for comments critics have viewed as disparaging to minorities and small-scale agriculture when The Des Moines Register on Wednesday published a transcript of the taped conversation.

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On the tape, Dorr was asked if the financial arrangement he used to avoid a $50,000 limit on payments to individual farms was legal. Dorr replied: "I have no idea if it's legal. Nobody's ever called me on it."

The Agriculture Department cleared him of criminal wrongdoing after reviewing his farm operation in 1995.

But Sen. Mark Dayton, D-Minn., said Dorr "clearly intended to violate, circumvent, evade" payment rules in the way he reported the farm's financial structure to the department.

Dayton said the department should investigate the family's entire operation, which involves a series of trusts, several generations, and about 2,200 acres of land.

Dorr said his family did "nothing out of the ordinary relative to how many family farms are operated."

In order to stay in business, farmers must structure their farms in ways that make them eligible for as much government money as possible, Dorr told the senators.

Last year, 1,423 farms nationwide were ordered to repay about $960,000 in subsidies for various reasons, according to department records.

Dorr has been working at the department as a $120,000-a-year consultant since his nomination in April.

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The job Dorr is seeking is a relatively low-profile one, overseeing various loan and grant programs for businesses, housing and utilities. But his nomination has highlighted sharp divisions in Congress, farm groups and rural communities about the future of agriculture and the merits of large-scale, highly mechanized farming.

Dorr once suggested 225,000 acres as the optimum size for farms. He said Wednesday that he was not proposing the creation of such mammoth farm cooperatives but was instead suggesting that as the best size farm for minimizing production costs and maximizing bargaining power with suppliers and shippers.

Sen. Max Baucus, D-Mont., told Dorr his ideas were "antithetical to rural America" and that the main beneficiaries of such large cooperatives would be "people like you" who would manage them.

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On the Net: Agriculture Department rural development site: http://www.rurdev.usda.gov

Senate Agriculture Committee: http://agriculture.senate.gov

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