ANNAPOLIS - The Maryland Department of Agriculture Wednesday lifted one quarantine of poultry farms intended to quell an outbreak of avian flu, but imposed restrictions on areas south of Route 50 where a case was found last week.

Officials said they felt reassured since no new cases have been found since the initial discovery.

"We are very pleased that there have been no additional cases of avian influenza reported in the earlier quarantine area and that we are able to help farmers north of Route 50 begin to get back to work," said Maryland Agriculture Secretary Lewis R. Riley in a prepared statement.

"I thank everyone for their cooperation in limiting access to their farms," he said. "We must do everything that can be done to protect our state's leading agricultural industry and livelihood."

The admonition came after the H7N2 flu strain was found on a Worcester County farm Friday, about a month after the disease was discovered 60 miles away in Delaware's Kent and Sussex counties and the initial quarantine was ordered.

"We thought we had a lid on it," Deputy Secretary John Brooks told House Environmental Matters Committee members.

"That certainly came as a surprise and shock to all of us . . . it's very mysterious," Riley said at a meeting of the Maryland Agricultural Commission Wednesday morning.

Two farms owned by Mountaire Farms of Delaware Inc. destroyed 328,000 birds after the virus was found at one of the sites, Delmarva Poultry Industry President Joe Chisholm said.

And another closely affiliated facility will be depopulated later this week, Brooks said.

These figures add to the 100,000 chickens killed in Delaware as state and federal agriculture officials worked in collaboration with the poultry industry to set vigorous testing, disinfecting and other containment standards.

The industry provided up to $2.5 million for cleanup efforts and Maryland's $5 million indemnity fund will kick in for costs above that figure, Riley said.

The lifted quarantine affected areas south of the Pennsylvania state line, west of the Delaware state line, east of the Susquehanna River and north and east of Maryland Route 50.

Like the old order, the new quarantine prohibits the sale of live poultry, transport of poultry or poultry manure without previous testing. It also prohibits spreading manure on fields and the gathering of birds and sets cleaning and disinfecting requirements for personnel and equipment.

Lifting the previous quarantine will allow "production farmers to do some things in the field," Riley said, one of the looming concerns of farmers since the crop-planting season is almost at hand.

Though the flu's economic impact on Maryland's estimated $1.4 billion agriculture industry is not certain, farmers' domestic and international revenues have foundered, officials said.

U.S. poultry exports have been restricted in about 38 nations since the outbreak.

Some farmers "owe a lot of money to the banks," said Sen. J. Lowell Stoltzfus, R-Worcester, a former farmer.

Chicken houses holding about 300,000 birds and outfitted with sophisticated feeding and ventilation systems can cost around $150,000, he said.

And if farmers lost the estimated $4,500 to $9,000 per flock, without hope of insurance compensation, they would not be able to satisfy their loans.

"It's like someone suddenly says you're not going to get your salary for three to five months," he said.

But in a separate meeting Wednesday with the state's congressional delegation in Washington, federal agricultural officials said farmers could seek reimbursement for flock losses due to avian flu.

Andrea Morgan, associate deputy administrator for veterinary services at the U.S. Department of Agriculture, said the government could reimburse up to 50 percent of losses attributable to the H5 and H7 strains of the virus.

After the February outbreak in Delaware, members of Maryland's congressional delegation had asked USDA to establish a task force to keep the flu from spreading throughout Delmarva. After the Pocomoke discovery, they said they were even more concerned that the bird flu could topple the state's farm economy, one third of which is dependent on the poultry industry.

"We want to be sure every step is taken to contain the outbreak," said Sen. Paul Sarbanes, D-Md.

Morgan assured Washington lawmakers that federal agents are helping Maryland as much as possible, adding that the aggressive response by Maryland and Delaware officials helped minimize the spread of the virus. While the USDA considers bird-flu outbreaks state issues, she said, the federal government is more than willing to assist.

The USDA will only consider it a national problem if the H-7 virus mutates to a more pathogenic strain, Morgan said. That is because highly pathogenic strains are more likely to cause a ban on all U.S. poultry, rather than just the states where the outbreak has occurred.

Brooks said that Maryland is working with other states to adopt a regional approach to the disease and on ways to protect poultry exporters.

"Right now we're showing clearly to our international trading partners that we're dealing with this aggressively and that will help rebuild Maryland's poultry industry's reputation."

-- Capital News Service reporter Jen DeGregorio contributed to this report in Washington.

Copyright © 2004 University of Maryland Philip Merrill College of Journalism