By Swinford                                           H.B. No. 2505
       74R3731 MWV-D
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to commercial animal feed; providing a penalty.
    1-3        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-4        SECTION 1.  Section 141.001, Agriculture Code, is amended to
    1-5  read as follows:
    1-6        Sec. 141.001.  Definitions.  In this chapter:
    1-7              (1)  "Animal" means an animate being that is not human
    1-8  and has the power of voluntary action.
    1-9              (2)  "Board" means the board of regents of The Texas
   1-10  A&M University System.
   1-11              (3)  "Broker" means a person who is employed on a
   1-12  commission basis to sell property for another person.  The term
   1-13  does not include a person who:
   1-14                    (A)  has possession or absolute control over the
   1-15  property that is to be sold;
   1-16                    (B)  receives a salary; or
   1-17                    (C)  acts for one party to the exclusion of all
   1-18  others <"Brand" means the term, design, or trademark or other
   1-19  specific designation under which a commercial feed is distributed
   1-20  in this state>.
   1-21              (4)  "Bulk" means any lot of commercial feed that is
   1-22  not in a closed container at the time it passes to the possession
   1-23  of the consumer and includes that feed at any stage of
   1-24  distribution.
    2-1              (5)  "Container" means a bag, box, barrel, bottle,
    2-2  package, carton, object, apparatus, device, or appliance in which
    2-3  commercial feed is packed, stored, or placed for handling,
    2-4  transporting, or distributing.
    2-5              (6)  "Contract feeder" means a person who:
    2-6                    (A)  contracts with the owner of animals to care
    2-7  for and feed the animals solely at the person's place of business;
    2-8                    (B)  uses only the person's own feed facilities,
    2-9  labor, supplies, and feedstuffs; and
   2-10                    (C)  bills the owner of the animals at regular
   2-11  intervals on the basis of the cost of the feedstuffs and a charge
   2-12  for the use of the person's facilities and services.
   2-13              (7)  "Cotton plant by-products" means the residue from
   2-14  the ginning of cotton.
   2-15              (8) <(7)>  "Customer-formula feed" means a mixture of
   2-16  commercial feed or feed material all or part of which is furnished
   2-17  by the person who processes, mixes, mills, or otherwise prepares
   2-18  the mixture and which is mixed according to the specific
   2-19  instructions of the purchaser.  The term includes a special formula
   2-20  feed or a made-to-order feed.
   2-21              (9) <(8)>  "Director" means the director of the Texas
   2-22  Agricultural Experiment Station.
   2-23              (10) <(9)>  "Distribute" means sell, offer for sale,
   2-24  barter, exchange, or otherwise supply.
   2-25              (11)  "Feed facility" means a site where feed, a
   2-26  component of feed, or feed ingredients are mixed, custom blended,
   2-27  ground, unground, manufactured, milled, bagged, or processed.
    3-1              (12) <(10)>  "Ingredient" means a constituent material
    3-2  of commercial feed.
    3-3              (13) <(11)>  "Label" means a display of written,
    3-4  printed, or graphic matter on or affixed to or wrapped with a
    3-5  container or on an invoice or delivery slip.
    3-6              (14)  "Licensee" means a person who obtains a license
    3-7  to operate a feed facility under this chapter.
    3-8              (15) <(12)>  "Official sample" means a sample of feed
    3-9  taken by the service and designated as official by the service.
   3-10              (16)  "Product" means the name of the commercial feed
   3-11  that identifies it to kind, class, or specific use and includes the
   3-12  brand, term, trademark, or other specific designation under which
   3-13  commercial feed is distributed in this state.
   3-14              (17) <(13)>  "Purchaser" means a person who buys or
   3-15  otherwise acquires a commercial feed, customer-formula feed, or
   3-16  custom-mix or custom-mill service.
   3-17              (18) <(14)  "Registrant" means a person who registers a
   3-18  commercial feed under this chapter.>
   3-19              <(15)>  "Service" means the Texas Feed and Fertilizer
   3-20  Control Service.
   3-21              (19) <(16)>  "Ton" means a net weight of 2,000 pounds
   3-22  avoirdupois or 1,000 kilograms metric.
   3-23              (20) <(17)>  "Weight" means net weight of a container
   3-24  of commercial feed expressed in either the avoirdupois or metric
   3-25  system.
   3-26        SECTION 2.  Section 141.002(c), Agriculture Code, is amended
   3-27  to read as follows:
    4-1        (c)  The following are not commercial feeds subject to this
    4-2  chapter:
    4-3              (1)  unground hay not containing toxins or chemical
    4-4  adulterants;
    4-5              (2)  whole grain or whole seed not containing toxins or
    4-6  chemical adulterants;
    4-7              (3)  unadulterated cotton plant by-products or any
    4-8  unadulterated <cottonseed, peanut, or rice> hulls;
    4-9              (4)  a feed product produced and sold by a farmer or a
   4-10  feed that is produced and consumed by a contract feeder;
   4-11              (5)  an individual mineral substance not mixed with
   4-12  another material; <or>
   4-13              (6)  a material furnished by a purchaser for use in a
   4-14  customer-formula feed that was produced by the purchaser or
   4-15  acquired by the purchaser from a source other than the person whose
   4-16  services are engaged in the milling, mixing, or processing of a
   4-17  customer-formula feed; or
   4-18              (7)  a feed or feed ingredient handled by a broker.
   4-19        SECTION 3.  Section 141.021, Agriculture Code, is amended to
   4-20  read as follows:
   4-21        Sec. 141.021.  LICENSE <PERMIT AND REGISTRATION> REQUIRED.
   4-22  (a)  A person may not manufacture or distribute commercial feed in
   4-23  this state without a valid current license for each feed facility
   4-24  that manufacturers or distributes commercial feed.  A person making
   4-25  only retail sales of commercial feed bearing the label  of a
   4-26  licensed manufacturer, guarantor, or distributor is not required to
   4-27  obtain a license <permit issued by the service, and a person may
    5-1  not manufacture or distribute a commercial feed in this state,
    5-2  other than a customer-formula feed, unless the person first
    5-3  registers the feed with the service>.
    5-4        (b)  An application for a license <permit or registration>
    5-5  shall be submitted on a form prescribed and provided by the service
    5-6  and accompanied by a license fee not to exceed $75 for each
    5-7  facility, as provided by department rule.
    5-8        (c)  A licensee or license applicant shall provide the
    5-9  service copies of labels and labeling and other information that
   5-10  the service by rule requires <Registration is required for each
   5-11  distinct mixture, formulation, or type of commercial feed
   5-12  manufactured or distributed in this state>.
   5-13        (d)  A person applying for a license after the 30th day
   5-14  following receipt of notice to obtain a license and a licensee
   5-15  applying late for a license renewal shall pay a $75 late fee in
   5-16  addition to the license fee <is not required to register a
   5-17  commercial feed that has been registered by another person>.
   5-18        SECTION 4.  Section 141.023, Agriculture Code, is amended to
   5-19  read as follows:
   5-20        Sec. 141.023.  TERM OF LICENSE <PERMIT AND REGISTRATION>.  A
   5-21  license <permit or registration> issued under this chapter is
   5-22  permanent unless:
   5-23              (1)  the service revokes, suspends, annuls, or amends
   5-24  the license <permit or registration>;
   5-25              (2)  the licensee <permittee or registrant> withdraws
   5-26  or cancels the license <permit or registration>; <or>
   5-27              (3)  the licensee's report to the service indicates no
    6-1  activity for one year; or
    6-2              (4)  the service requires a new license <permit or new
    6-3  registration>.
    6-4        SECTION 5.  Section 141.025, Agriculture Code, is amended to
    6-5  read as follows:
    6-6        Sec. 141.025.  REFUSAL OR REVOCATION OF LICENSE <PERMIT>.
    6-7  Following notice and a hearing, the service may revoke, suspend,
    6-8  annul, or amend an existing license <permit> or may refuse to issue
    6-9  a license <permit> if it finds that the licensee <permittee> or
   6-10  applicant has:
   6-11              (1)  been convicted of a crime for which a license
   6-12  <permit> may be revoked, suspended, annulled, amended, or refused
   6-13  under Article 6252-13c, Revised Statutes;
   6-14              (2)  refused or after notice failed to comply with this
   6-15  chapter and rules adopted under this chapter; or
   6-16              (3)  used fraudulent or deceptive practices in
   6-17  attempting evasion of this chapter or a rule adopted under this
   6-18  chapter.
   6-19        SECTION 6.  Section 141.051(a), Agriculture Code, is amended
   6-20  to read as follows:
   6-21        (a)  Except as provided by Subsection (d) of this section,
   6-22  each container of commercial feed distributed in this state, other
   6-23  than customer-formula feed, must have a label with the following
   6-24  information:
   6-25              (1)  the name and principal address of the person
   6-26  responsible for manufacture and distribution;
   6-27              (2)  the brand or name under which the feed is to be
    7-1  distributed;
    7-2              (3)  the quantity <net weight> of the feed in the
    7-3  container, in either net weight, net volume contents, or net fluid
    7-4  content according to rules adopted by the service <with specific
    7-5  designation of the weight system used>;
    7-6              (4)  the guaranteed analysis of nutrients in the feed,
    7-7  listing a maximum or minimum quantity determinable by laboratory
    7-8  methods of protein, fat, fiber, and other components of commercial
    7-9  feed;
   7-10              (5)  the common or usual name of each ingredient used
   7-11  in the feed;
   7-12              (6)  <the name and percentage of any hulls, shells,
   7-13  screenings, straw, stalks, corncobs, or other low grade feeding
   7-14  materials or fillers in the feed, if any;>
   7-15              <(7)>  an appropriate warning statement and directions
   7-16  for use relating to each medicine, drug, mineral, vitamin,
   7-17  antibiotic, or antioxidant in the feed; and
   7-18              (7) <(8)>  other information that the service may by
   7-19  rule require.
   7-20        SECTION 7.  Section 141.071, Agriculture Code, is amended to
   7-21  read as follows:
   7-22        Sec. 141.071.  Inspection Fee.  (a)  For each state fiscal
   7-23  year, a person who manufactures or distributes commercial feed or a
   7-24  component of commercial feed in this state, including a person who
   7-25  mixes, mills, or processes customer-formula feed, shall pay to the
   7-26  service an inspection fee prescribed by this section.
   7-27        (b)  Except as otherwise provided by this section, the
    8-1  inspection fee is 17 <15> cents per ton of commercial feed.  With
    8-2  the approval of the board, the director may reduce or increase the
    8-3  inspection in increments of 1 cent up to a maximum of 2 cents per
    8-4  fiscal year, except that the board and director shall reduce the
    8-5  inspection fee by 1 cent increments when the balance of the Texas
    8-6  feed control fund exceeds one-half the operating expenses of the
    8-7  service at the end of a fiscal year.
    8-8        (c)  <A person distributing in this state a commercial feed
    8-9  product packaged in individual containers of five pounds or less
   8-10  shall pay, for each distinct commercial feed product so
   8-11  distributed, a flat rate inspection fee of $50 for each fiscal year
   8-12  or part of a fiscal year in which the distribution is made.>
   8-13        <(d)>  A licensee <registrant> paying an inspection fee under
   8-14  Subsection (b) of this section shall pay in advance a minimum
   8-15  annual inspection fee of $100 per fiscal year.  All advance
   8-16  inspection fees collected under this section shall be credited
   8-17  towards the first tonnage inspection fee owed by the licensee
   8-18  <registrant> accruing in that fiscal year.
   8-19        (d) <(e)>  A person is not required to pay an inspection fee
   8-20  on a portion of a customer-formula feed that is produced by the
   8-21  purchaser or acquired by the purchaser from a source other than the
   8-22  person who mixes, mills, or processes the mixture.
   8-23        (e) <(f)>  The service by rule may provide that a person is
   8-24  not required to pay an inspection fee on commercial feed that the
   8-25  person manufactures or distributes solely for investigational,
   8-26  experimental, or laboratory use by qualified persons, if the
   8-27  investigation or experiment is conducted in the public interest.
    9-1        SECTION 8.  Section 141.072, Agriculture Code, is amended to
    9-2  read as follows:
    9-3        Sec. 141.072.  Quarterly Tonnage Reporting and Inspection Fee
    9-4  Payment.  (a)  The person responsible for paying the inspection fee
    9-5  for a feed facility generating $100 or more during a license year
    9-6  from tonnage fees shall file with the service a quarterly sworn
    9-7  report either stating that no tonnage of commercial feed was
    9-8  distributed during the preceding quarter or setting forth the
    9-9  tonnage of all commercial feed that the feed facility <person>
   9-10  manufactured or distributed in this state during the preceding
   9-11  quarter.  Each quarterly tonnage report must be accompanied by
   9-12  payment of the inspection fee due based on the tonnage reported for
   9-13  that quarter.
   9-14        (b)  The person responsible for paying the inspection fee for
   9-15  a feed facility producing less than $100 a license year in tonnage
   9-16  fees shall file with the service an annual sworn report either
   9-17  stating that no tonnage of commercial feed was distributed during
   9-18  the preceding license year or stating the tonnage of all commercial
   9-19  feed the facility manufactured and distributed in this state during
   9-20  the preceding license year.  Each annual tonnage report must be
   9-21  accompanied by payment of the inspection fee due based on the
   9-22  tonnage reported for that year.
   9-23        (c)  A quarterly tonnage report and inspection fee payment is
   9-24  due on or before the 31st day following the last day of November,
   9-25  February, May, and August for persons reporting quarterly.  An
   9-26  annual tonnage report and inspection fee payment is due on or
   9-27  before the  31st day following the last day of August for persons
   10-1  reporting annually.
   10-2        (d) <(c)>  The service may prescribe and furnish forms as
   10-3  necessary under this section.
   10-4        SECTION 9.  Section 141.073(b), Agriculture Code, is amended
   10-5  to read as follows:
   10-6        (b)  The penalty together with any delinquent inspection
   10-7  fee<,> is due before the 61st <41st> day following the last day of
   10-8  the quarter.  The service shall cancel the license of a licensee
   10-9  <registration of a registrant> who fails to pay the penalty and
  10-10  delinquent inspection fee within that time period after notice.
  10-11        SECTION 10.  Section 141.074(a), (c), and (d), Agriculture
  10-12  Code, are amended to read as follows:
  10-13        (a)  For the purpose of determining the accurate tonnage of
  10-14  commercial feed distributed in this state or identify or verify
  10-15  <quarterly> tonnage reports, the service may require each licensee
  10-16  <registrant> to maintain records or file additional reports.
  10-17        (c)  Unless otherwise authorized by the service, a licensee
  10-18  <registrant> shall preserve and maintain the records under this
  10-19  section in usable condition for at least two years.  The service
  10-20  may require a licensee <registrant> to retain the records for a
  10-21  period longer than two years if the service determines it to be in
  10-22  the public interest.
  10-23        (d)  If a licensee <registrant> is located outside this
  10-24  state, the licensee <registrant> shall maintain records required
  10-25  under this section in this state or pay all costs incurred in the
  10-26  auditing of the records at another location.  The service shall
  10-27  promptly furnish to the licensee <registrant> an itemized statement
   11-1  of any costs incurred in an out-of-state audit and the licensee
   11-2  <registrant> shall pay the costs before the 31st day following the
   11-3  date of the statement.
   11-4        SECTION 11.  Section 141.075(b), Agriculture Code, is amended
   11-5  to read as follows:
   11-6        (b)  The Texas feed control fund shall be used, with the
   11-7  approval and consent of the board, for administering this chapter,
   11-8  including paying the cost of:
   11-9              (1)  equipment and facilities;
  11-10              (2)  inspection, sampling, and analysis;
  11-11              (3)  licensing <registration>;
  11-12              (4)  salaries; and
  11-13              (5)  publication of bulletins and reports.
  11-14        SECTION 12.  Section 141.121(c), Agriculture Code, is amended
  11-15  to read as follows:
  11-16        (c)  A stop-sale order expires at the end of the 30th <10th>
  11-17  day following the day on which it was affixed unless, prior to that
  11-18  time, the service has instituted proceedings under Section 141.122
  11-19  of this code to condemn the feed.
  11-20        SECTION 13.  Sections 141.122(c) and (d), Agriculture Code,
  11-21  are amended to read as follows:
  11-22        (c)  If the court finds that a violation of this chapter may
  11-23  be corrected by proper processing or labeling, the court may order
  11-24  that the feed be delivered to the licensee <registrant> of the feed
  11-25  for processing or labeling under the supervision of the service.
  11-26  Before entering that order, the court shall:
  11-27              (1)  enter the decree;
   12-1              (2)  require that all costs, fees, and expenses be
   12-2  paid; and
   12-3              (3)  require the licensee <registrant> of the feed to
   12-4  post good and sufficient bond conditioned on the proper labeling
   12-5  and processing of the feed.
   12-6        (d)  The licensee <registrant> of the feed shall pay all
   12-7  costs incurred by the service in the supervision of labeling or
   12-8  processing under Subsection (c) of this section.  The court shall
   12-9  return the bond to the licensee <registrant> when the service
  12-10  notifies the court that the commercial feed is no longer in
  12-11  violation of this chapter and that the licensee <registrant> has
  12-12  paid the expenses of supervision.
  12-13        SECTION 14.  Section 141.148(a), Agriculture Code, is amended
  12-14  to read as follows:
  12-15        (a)  A person commits an offense if the person distributes,
  12-16  conspires to distribute, or causes another person to distribute
  12-17  commercial feed:
  12-18              (1)  that is of a composition, quantity, or quality
  12-19  that is below or is different from that which it is represented to
  12-20  possess by its label;
  12-21              (2)  that is moldy, sour, heated, or otherwise damaged,
  12-22  because of which it is injurious to animals;
  12-23              (3)  from which an ingredient has been omitted or
  12-24  extracted in whole or in part;
  12-25              (4)  that is inferior or is damaged and the inferiority
  12-26  or damage has been concealed;
  12-27              (5)  to which a substance has been added or with which
   13-1  a substance has been mixed or packed so as to deceptively increase
   13-2  its bulk or weight, reduce its quality or strength, or make it
   13-3  appear better or of greater value than it is;
   13-4              (6)  that contains or bears a poisonous or deleterious
   13-5  substance that may render it injurious to animals under ordinary
   13-6  conditions of use;
   13-7              (7)  that contains a low-grade feeding material or
   13-8  filler but is not labeled in accordance with Section 141.054 of
   13-9  this code;
  13-10              (8)  that consists in whole or in part of a diseased,
  13-11  filthy, putrid, or decomposed substance, unless the substance has
  13-12  been rendered harmless by sterilization or other effective process;
  13-13  <or>
  13-14              (9)  that is otherwise unfit for feeding to animals; or
  13-15              (10)  that has been intentionally subjected to
  13-16  radiation, unless the use of the radiation was in conformity with a
  13-17  regulation or exemption in effect under 21 U.S.C. Section 348.
  13-18        SECTION 15.  Subchapter G, Chapter 141, Agriculture Code, is
  13-19  amended by adding Section 141.149 to read as follows:
  13-20        Sec. 141.149.  RULES; PENALTY.  (a)  The service shall adopt
  13-21  rules that conform to current good manufacturing practices as
  13-22  established under 21 U.S.C. Section 360b for the use of drugs in
  13-23  the manufacture, processing, and packaging of commercial feed
  13-24  unless the service determines that those practices are not
  13-25  appropriate to conditions existing in this state.
  13-26        (b)  A person commits an offense if the person violates a
  13-27  rule adopted under Subsection (a).  An offense under this section
   14-1  is a Class C misdemeanor unless it is shown that the person has
   14-2  previously been convicted of an offense under this subchapter, in
   14-3  which event it is a Class B misdemeanor.
   14-4        SECTION 16.  Sections 141.022, 141.024, and 141.026,
   14-5  Agriculture Code, are repealed.
   14-6        SECTION 17.  This Act takes effect September 1, 1995.
   14-7        SECTION 18.  The importance of this legislation and the
   14-8  crowded condition of the calendars in both houses create an
   14-9  emergency and an imperative public necessity that the
  14-10  constitutional rule requiring bills to be read on three several
  14-11  days in each house be suspended, and this rule is hereby suspended.