AB 590

Bill Subjects

Abstract

(1) Existing law confers upon the Secretary of Food and Agriculture the ability to establish and administer the Milk Producers Security Trust Fund to reimburse milk producers for milk that is shipped to a handler when the handler defaults on payment. Existing law authorizes the secretary to maintain the fund by collecting a security charge on covered milk, as defined, from handlers, and, if the value of a handler's monthly milk purchases, as adjusted, exceeds a specified amount, requires a handler to provide an acceptable security, as defined, to the secretary. Existing law requires a transaction to meet certain criteria in order to be covered by the fund, and specifies the amount of reimbursement that is owed to a milk producer in case of default on a covered transaction. Existing law continuously appropriates any money that is collected by the secretary pursuant to these provisions, including penalty revenues, and interest from the investment, reinvestment, or deposit of that money, to reimburse milk producers and for other purposes. Under existing federal regulations that took effect October 17, 2018, the United States Department of Agriculture established a Federal Milk Marketing Order for California that requires handlers to pay uniform minimum prices to producers, calculated as provided, for milk of various classes that is pooled under the Federal Milk Marketing Order. Existing state law, upon adoption of a federal milk marketing order, suspends the operation of provisions of existing state law authorizing establishment of stabilization and marketing plans setting uniform minimum prices for various classes of market milk, as defined, and the Gonsalves Milk Pooling Act, that are inconsistent with the Federal Milk Marketing Order. This bill would recast and revise the provisions governing administration of the Milk Producers Security Trust Fund by, among other things, deleting obsolete references to the stabilization and marketing plans and pooling plan supplanted by the Federal Milk Marketing Order, redefining various terms for consistency with the Federal Milk Marketing Order, changing the computation of security charges and acceptable securities for which handlers are liable, including by requiring security charges to be imposed on eligible milk, as defined, and solids-not-fat contained in eligible milk, instead of covered milk, as defined, and solids-not-fat contained in covered milk, and changing the computation of amounts owed to producers upon default. The bill would also require the secretary to collect an assessment on producers, as provided, to defray the costs of administering these provisions, except as provided. By authorizing the collection of an assessment that, with penalties for late payment and interest, would be continuously appropriated, this bill would make an appropriation. (2) Existing law provides for various commissions to promote the production and marketing of agricultural commodities. Existing law, the Dairy Council of California Law, establishes the Dairy Council of California within the state government and prescribes the membership of the council. Existing law specifies the powers, duties, and responsibilities of the council, and requires the secretary to conduct various activities relating to research, advertising, publicity, and education. Existing law requires the secretary to establish, and to collect from producers, handlers, and producer-handlers, a fee on class 1 milk, as defined, and milk for all other usages, as defined, that contains specified percentages of milkfat or solids-not-fat. Existing law continuously appropriates these fees to the Department of Food and Agriculture to carry out the duties that are imposed upon the secretary and the council pursuant to these provisions. Existing law requires the secretary to hold a public hearing or referendum every 5 years to determine whether the council program shall continue in effect. This bill would recast and revise the Dairy Council of California Law to, in general, refocus the secretary's and the council's activities on research, communication, and education regarding the nutritional role of milk products. The bill would redefine the terms "producer-handler," "class I milk," and "all other usages," and add a definition for "solids-not-fat," to be consistent with the definitions in the Federal Milk Marketing Order. Instead of the fees described above, the bill would require the secretary to establish assessments on milk and on solids-not-fat contained in milk, as provided. By creating new and higher assessments, the revenue from which is continuously appropriated, the bill would make an appropriation. The bill would also, among other things, revise provisions regarding the membership of the council and recordkeeping. The bill would make extensive technical and conforming changes. (3) Existing law requires sample copies of labels used in connection with advertising and consumer sales of milk and certain related products to be submitted to the secretary for approval and requires any labeling requirements adopted by the secretary pursuant to this provision to be in conformity with the Federal Food, Drug, and Cosmetic Act and certain federal regulations. Existing law requires labeling requirements for modified foods, as provided, to conform to those same federal regulations. This bill would streamline those labeling requirements to instead require the secretary to enforce the labeling requirements established under the Federal Food, Drug, and Cosmetic Act and those federal regulations in the review of labels to be used in connection with advertising and retail sales of milk, frozen and cultured dairy products, cheese, and products resembling milk products and for all dairy products sold in the state. (4) Existing law requires the use of certain methods of analysis for determining the components of milk and certain related products and authorizes the secretary to, by regulation, adopt other acceptable methods of comparable accuracy. Existing law requires the secretary to supervise the testing of milk fat and milk solids-not-fat and the weighing and sampling of market milk delivered to handlers. Existing law authorizes the secretary to assess a fee on all producers, producer-handlers, and handlers to be used exclusively for the supervision of and checking the corrections of the milk fat, milk solids-not-fat, and bacteriological tests, and the weighing and sampling of all market milk delivered to handlers in accordance with the stabilization and marketing plans. Existing law requires a handler subject to any stabilization and marketing plan, including a producer-handler, to pay an assessment to, and requires a handler subject to the provisions of any stabilization and marketing plan that purchases or handles milk from producers to pay a fee to, the secretary that do not exceed specified amounts. This bill would repeal the provision requiring the use of certain methods of analysis for the determination of the components of milk and certain related products, and the authorization to adopt other acceptable methods. The bill would revise the secretary's supervisory duties described above to instead require the secretary to supervise the weighing, measuring, sampling, bacteriological testing, and sanitary loading and unloading of bulk milk delivered to handlers. The bill would require the fee assessed by the secretary on producers, producer-handlers, and handlers to be used for the supervision of, and checking the corrections of, bacteriological tests, and the weighing, measuring, sampling, and sanitary loading and unloading of all bulk milk delivered to handlers. The bill would revise the provisions imposing the assessment and fee on certain handlers described above to apply to all handlers and would authorize the secretary to increase the amounts of those assessments. The bill would add definitions for "handler," "producer," and "producer-handler" for purposes of these provisions.