By Turner of Coleman H.B. No. 2000
76R6353 BDH-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the ratification of the Southern Dairy Compact;
1-3 providing civil penalties.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subtitle D, Title 6, Agriculture Code, is amended
1-6 by adding Chapter 182 to read as follows:
1-7 CHAPTER 182. SOUTHERN DAIRY COMPACT
1-8 Sec. 182.001. DEFINITIONS. In this chapter:
1-9 (1) "Compact" means the Southern Dairy Compact.
1-10 (2) "Compact commission" means the Southern Dairy
1-11 Compact Commission established by Section 4, Article III, of the
1-12 compact.
1-13 (3) "Delegate" means a member of the delegation from
1-14 this state to the Southern Dairy Compact Commission as set forth in
1-15 Section 4, Article III, of the compact.
1-16 Sec. 182.002. DELEGATES; QUALIFICATIONS. (a) The
1-17 commissioner may be a delegate or may appoint another person to
1-18 serve as a delegate in the commissioner's place at the pleasure of
1-19 the commissioner. If the commissioner appoints another person as a
1-20 delegate, the commissioner's appointee must be an employee of the
1-21 department, preferably an employee with experience with milk
1-22 marketing and stabilization. The delegate serving under this
1-23 subsection shall serve as chair of the delegation from this state.
1-24 (b) The governor shall appoint four additional delegates to
2-1 this state's delegation to the compact commission as follows:
2-2 (1) two delegates who must be dairy farmers engaged in
2-3 the production of milk at the time of appointment or reappointment;
2-4 (2) one delegate who must be a dairy processor engaged
2-5 in the production of milk at the time of appointment or
2-6 reappointment; and
2-7 (3) one delegate who must be a consumer
2-8 representative.
2-9 (c) Each delegate must be a resident and registered voter
2-10 of this state.
2-11 (d) A delegate is not an officer of this state by virtue of
2-12 holding the position of delegate.
2-13 Sec. 182.003. TERMS; REMOVAL; VACANCY. (a) Each delegate
2-14 appointed under Section 182.002(b) serves a term of four years.
2-15 (b) Each delegate appointed under Section 182.002(b) shall
2-16 serve from the date of appointment until a successor is appointed
2-17 and qualified.
2-18 (c) A delegate appointed under Section 182.002(b) may not
2-19 serve more than three consecutive terms.
2-20 (d) A delegate appointed under Section 182.002(b) may be
2-21 removed for cause.
2-22 Sec. 182.004. EFFECTIVE DATE OF COMPACT. (a) The compact
2-23 shall become effective when:
2-24 (1) the governor has executed the compact on behalf of
2-25 this state and has filed a verified copy of the compact with the
2-26 secretary of state;
2-27 (2) the United States Congress has consented to the
3-1 compact; and
3-2 (3) two or more of the other states named in Section
3-3 20, Article VII, of the compact, have ratified the compact in a
3-4 form substantially similar to that contained in Section 182.005.
3-5 (b) The governor shall take such action as may be necessary
3-6 to complete the exchange of official documents between this state
3-7 and any other state ratifying the compact.
3-8 Sec. 182.005. COMPACT TO BE ENTERED; TEXT. Subject to
3-9 Section 182.004, the Southern Dairy Compact is hereby entered into
3-10 and enacted into law as follows:
3-11 ARTICLE I. STATEMENT OF PURPOSE, FINDINGS, AND
3-12 DECLARATION OF POLICY
3-13 Sec. 1. STATEMENT OF PURPOSE, FINDINGS, AND DECLARATION OF
3-14 POLICY. The purpose of this compact is to recognize the interstate
3-15 character of the southern dairy industry and the prerogative of the
3-16 states under the United States Constitution to form an interstate
3-17 commission for the southern region. The mission of the commission
3-18 is to take such steps as are necessary to assure the continued
3-19 viability of dairy farming in the South, and to assure consumers of
3-20 an adequate, local supply of pure and wholesome milk.
3-21 The participating states find and declare that the dairy
3-22 industry is an essential agricultural activity of the South. Dairy
3-23 farms, and associated suppliers, marketers, processors, and
3-24 retailers, are an integral component of the region's economy.
3-25 Their ability to provide a stable, local supply of pure, wholesome
3-26 milk is a matter of great importance to the health and welfare of
3-27 the region.
4-1 The participating states further find that dairy farms are
4-2 essential and they are an integral part of the region's rural
4-3 communities. The farms preserve land for agricultural purposes and
4-4 provide needed economic stimuli for rural communities.
4-5 By entering into this compact, the participating states
4-6 affirm that their ability to regulate the price which southern
4-7 dairy farmers receive for their product is essential to the public
4-8 interest. Assurance of a fair and equitable price for dairy
4-9 farmers ensures their ability to provide milk to the market and the
4-10 vitality of the southern dairy industry, with all the associated
4-11 benefits.
4-12 Recent dramatic price fluctuations, with a pronounced
4-13 downward trend, threaten the viability and stability of the
4-14 southern dairy region. Historically, individual state regulatory
4-15 action had been an effective emergency remedy available to farmers
4-16 confronting a distressed market. The federal order system,
4-17 implemented by the Agricultural Marketing Agreement Act of 1937,
4-18 establishes only minimum prices paid to producers for raw milk,
4-19 without preempting the power of states to regulate milk prices
4-20 above the minimum levels so established.
4-21 In today's regional dairy marketplace, cooperative, rather
4-22 than individual state action, is needed to more effectively address
4-23 the market disarray. Under our constitutional system, properly
4-24 authorized states acting cooperatively may exercise more power to
4-25 regulate interstate commerce than they may assert individually
4-26 without such authority. For this reason, the participating states
4-27 invoke their authority to act in common agreement, with the consent
5-1 of the United States Congress, under the compact clause of the
5-2 United States Constitution.
5-3 In establishing their constitutional regulatory authority
5-4 over the region's fluid milk market by this compact, the
5-5 participating states declare their purpose that this compact
5-6 neither displace the federal order system nor encourage the merging
5-7 of federal orders. Specific provisions of the compact itself set
5-8 forth this basic principle.
5-9 Designed as a flexible mechanism able to adjust to changes in
5-10 a regulated marketplace, the compact also contains a contingency
5-11 provision should the federal order system be discontinued. In that
5-12 event, the interstate commission is authorized to regulate the
5-13 marketplace in replacement of the order system. This contingent
5-14 authority does not anticipate such a change, however, and should
5-15 not be so construed. It is only provided should developments in
5-16 the market other than establishment of this compact result in
5-17 discontinuance of the order system.
5-18 ARTICLE II. DEFINITIONS AND RULES OF CONSTRUCTION
5-19 Sec. 2. DEFINITIONS. For the purposes of this compact, and
5-20 of any supplemental or concurring legislation enacted pursuant
5-21 thereto, except as may be otherwise required by the context:
5-22 (1) "Class I milk" means milk disposed of in fluid
5-23 form or as a fluid milk product, subject to further definition in
5-24 accordance with the principles expressed in Section 3(b) of this
5-25 compact.
5-26 (2) "Commission" means the Southern Dairy Compact
5-27 Commission established by this compact.
6-1 (3) "Commission marketing order" means regulations
6-2 adopted by the commission pursuant to Sections 9 and 10 of this
6-3 compact in place of a terminated federal marketing order or state
6-4 dairy regulation. Such order may apply throughout the region or in
6-5 any part or parts thereof as defined in the regulations of the
6-6 commission. Such order may establish minimum prices for any or all
6-7 classes of milk.
6-8 (4) "Compact" means this interstate compact.
6-9 (5) "Compact over-order price" means a minimum price
6-10 required to be paid to producers for Class I milk established by
6-11 the commission in regulations adopted pursuant to Sections 9 and 10
6-12 of this compact, which is above the price established in federal
6-13 marketing orders or by state farm price regulation in the regulated
6-14 area. Such price may apply throughout the region or in any part or
6-15 parts thereof as defined in the regulations of the commission.
6-16 (6) "Milk" means the lacteal secretion of cows and
6-17 includes all skim, butterfat, or other constituents obtained from
6-18 separation or any other process. The term is used in its broadest
6-19 sense and may be further defined by the commission for regulatory
6-20 purposes.
6-21 (7) "Partially regulated plant" means a milk plant not
6-22 located in a regulated area but having Class I distribution within
6-23 such area. Commission regulations may exempt plants having such
6-24 distribution or receipts in amounts less than the limits defined
6-25 therein.
6-26 (8) "Participating state" means a state which has
6-27 become a party to this compact by the enactment of concurring
7-1 legislation.
7-2 (9) "Pool plant" means any milk plant located in a
7-3 regulated area.
7-4 (10) "Region" means the territorial limits of the
7-5 states which are parties to this compact.
7-6 (11) "Regulated area" means any area within the region
7-7 governed by and defined in regulations establishing a compact
7-8 over-order price or commission marketing order.
7-9 (12) "State dairy regulation" means any state
7-10 regulation of dairy prices, and associated assessments, whether by
7-11 statute, marketing order, or otherwise.
7-12 Sec. 3. RULES OF CONSTRUCTION. (a) This compact shall not
7-13 be construed to displace existing federal milk marketing orders or
7-14 state dairy regulation in the region but to supplement them. In
7-15 the event some or all federal orders in the region are
7-16 discontinued, the compact shall be construed to provide the
7-17 commission the option to replace them with one or more commission
7-18 marketing orders pursuant to this compact.
7-19 (b) This compact shall be construed liberally in order to
7-20 achieve the purposes and intent enunciated in Section 1 of this
7-21 compact. It is the intent of this compact to establish a basic
7-22 structure by which the commission may achieve those purposes
7-23 through the application, adaptation, and development of the
7-24 regulatory techniques historically associated with milk marketing
7-25 and to afford the commission broad flexibility to devise regulatory
7-26 mechanisms to achieve the purposes of this compact. In accordance
7-27 with this intent, the technical terms which are associated with
8-1 market order regulation and which have acquired commonly understood
8-2 general meanings are not defined herein, but the commission may
8-3 further define the terms used in this compact and develop
8-4 additional concepts and define additional terms as it may find
8-5 appropriate to achieve its purposes.
8-6 ARTICLE III. COMMISSION ESTABLISHED
8-7 Sec. 4. COMMISSION ESTABLISHED. There is hereby created a
8-8 commission to administer the compact, composed of delegations from
8-9 each state in the region. The commission shall be known as the
8-10 Southern Dairy Compact Commission. A delegation shall include not
8-11 less than three nor more than five persons. Each delegation shall
8-12 include at least one dairy farmer who is engaged in the production
8-13 of milk at the time of appointment or reappointment, and one
8-14 consumer representative. Delegation members shall be residents and
8-15 voters of, and subject to such confirmation process as is provided
8-16 for in, the appointing state. Delegation members shall serve no
8-17 more than three consecutive terms with no single term of more than
8-18 four years and be subject to removal for cause. In all other
8-19 respects, delegation members shall serve in accordance with the
8-20 laws of the state represented. The compensation, if any, of the
8-21 members of a state delegation shall be determined and paid by each
8-22 state, but their expenses shall be paid by the commission.
8-23 Sec. 5. VOTING REQUIREMENTS. All actions taken by the
8-24 commission, except for the establishment or termination of an
8-25 over-order price or commission marketing order, and the adoption,
8-26 amendment, or rescission of the commission's bylaws shall be by
8-27 majority vote of the delegations present. Each state delegation
9-1 shall be entitled to one vote in the conduct of the commission's
9-2 affairs. Establishment or termination of an over-order price or
9-3 commission marketing order shall require at least a two-thirds vote
9-4 of the delegations present. The establishment of a regulated area
9-5 which covers all or part of a participating state shall require
9-6 also the affirmative vote of that state's delegation. A majority
9-7 of the delegations from the participating states shall constitute a
9-8 quorum for the conduct of the commission's business.
9-9 Sec. 6. ADMINISTRATION AND MANAGEMENT. (a) The commission
9-10 shall elect annually from among the members of the participating
9-11 state delegations a chairperson, a vice-chairperson, and a
9-12 treasurer. The commission shall appoint an executive director and
9-13 fix his or her duties and compensation. The executive director
9-14 shall serve at the pleasure of the commission, and, together with
9-15 the treasurer, shall be bonded in an amount determined by the
9-16 commission. The commission may establish through its bylaws an
9-17 executive committee composed of one member elected by each
9-18 delegation.
9-19 (b) The commission shall adopt bylaws for the conduct of its
9-20 business by a two-thirds vote and shall have the power by the same
9-21 vote to amend and rescind these bylaws. The commission shall
9-22 publish its bylaws in convenient form with the appropriate agency
9-23 or officer in each of the participating states. The bylaws shall
9-24 provide for appropriate notice to the delegations of all commission
9-25 meetings and hearings and of the business to be transacted at such
9-26 meetings or hearings. Notice also shall be given to other agencies
9-27 or officers of participating states as provided by the laws of
10-1 those states.
10-2 (c) The commission shall file an annual report with the
10-3 secretary of agriculture of the United States, and with each of the
10-4 participating states by submitting copies to the governor, both
10-5 houses of the legislature, and the head of the state department
10-6 having responsibilities for agriculture.
10-7 (d) In addition to the powers and duties elsewhere
10-8 prescribed in this compact, the commission shall have the power:
10-9 (1) to sue and be sued in any state or federal court;
10-10 (2) to have a seal and alter the same at pleasure;
10-11 (3) to acquire, hold, and dispose of real and personal
10-12 property by gift, purchase, lease, license, or other similar
10-13 manner, for its corporate purposes;
10-14 (4) to borrow money and to issue notes, to provide for
10-15 the rights of the holders thereof and to pledge the revenue of the
10-16 commission as security therefore, subject to the provisions of
10-17 Section 18 of this compact;
10-18 (5) to appoint such officers, agents, and employees as
10-19 it may deem necessary and prescribe their powers, duties, and
10-20 qualifications; and
10-21 (6) to create and abolish such offices, employments,
10-22 and positions as it deems necessary for the purposes of the compact
10-23 and provide for the removal, term, tenure, compensation, fringe
10-24 benefits, pension, and retirement rights of its officers and
10-25 employees. The commission may also retain personal services on a
10-26 contract basis.
10-27 Sec. 7. RULEMAKING POWER. In addition to the power to
11-1 promulgate a compact over-order price or commission marketing
11-2 orders as provided by this compact, the commission is further
11-3 empowered to make and enforce such additional rules and regulations
11-4 as it deems necessary to implement any provisions of this compact,
11-5 or to effectuate in any other respect the purposes of this compact.
11-6 ARTICLE IV. POWERS OF THE COMMISSION
11-7 Sec. 8. POWERS TO PROMOTE REGULATORY UNIFORMITY, SIMPLICITY,
11-8 AND INTERSTATE COOPERATION. The commission is hereby empowered to:
11-9 (1) Investigate or provide for investigations or
11-10 research projects designed to review the existing laws and
11-11 regulations of the participating states, to consider their
11-12 administration and costs, and to measure their impact on the
11-13 production and marketing of milk and their effects on the shipment
11-14 of milk and milk products within the region.
11-15 (2) Study and recommend to the participating states
11-16 joint or cooperative programs for the administration of the dairy
11-17 marketing laws and regulations and to prepare estimates of cost
11-18 savings and benefits of such programs.
11-19 (3) Encourage the harmonious relationships between the
11-20 various elements in the industry for the solution of their material
11-21 problems. Conduct symposia or conferences designed to improve
11-22 industry relations or a better understanding of problems.
11-23 (4) Prepare and release periodic reports on activities
11-24 and results of the commission's efforts to the participating
11-25 states.
11-26 (5) Review the existing marketing system for milk and
11-27 milk products and recommend changes in the existing structure for
12-1 assembly and distribution of milk which may assist, improve, or
12-2 promote more efficient assembly and distribution of milk.
12-3 (6) Investigate costs and charges for producing,
12-4 hauling, handling, processing, distributing, selling, and for all
12-5 other services performed with respect to milk.
12-6 (7) Examine current economic forces affecting
12-7 producers, probable trends in production and consumption, the level
12-8 of dairy farm prices in relation to costs, the financial conditions
12-9 of dairy farmers, and the need for an emergency order to relieve
12-10 critical conditions on dairy farms.
12-11 Sec. 9. EQUITABLE FARM PRICES. (a) The powers granted in
12-12 this section and Section 10 of this compact shall apply only to the
12-13 establishment of a compact over-order price, so long as federal
12-14 milk marketing orders remain in effect in the region. In the event
12-15 that any or all such orders are terminated, this article shall
12-16 authorize the commission to establish one or more commission
12-17 marketing orders, as herein provided, in the region or parts
12-18 thereof as defined in the order.
12-19 (b) A compact over-order price established pursuant to this
12-20 section shall apply only to Class I milk. Such compact over-order
12-21 price shall not exceed $1.50 per gallon at Atlanta, Georgia;
12-22 however, this compact over-order price shall be adjusted upward or
12-23 downward at other locations in the region to reflect differences in
12-24 minimum federal order prices. Beginning in 1990, and using that
12-25 year as a base, the foregoing $1.50 per gallon maximum shall be
12-26 adjusted annually by the rate of change in the Consumer Price Index
12-27 as reported by the Bureau of Labor Statistics of the United States
13-1 Department of Labor. For purposes of the pooling and equalization
13-2 of an over-order price, the value of milk used in other use
13-3 classifications shall be calculated at the appropriate class price
13-4 established pursuant to the applicable federal order or state dairy
13-5 regulation, and the value of unregulated milk shall be calculated
13-6 in relation to the nearest prevailing class price in accordance
13-7 with and subject to such adjustments as the commission may
13-8 prescribe in regulations.
13-9 (c) A commission marketing order shall apply to all classes
13-10 and uses of milk.
13-11 (d) The commission is hereby empowered to establish a
13-12 compact over-order price for milk to be paid by pool plants and
13-13 partially regulated plants. The commission is also empowered to
13-14 establish a compact over-order price to be paid by all other
13-15 handlers receiving milk from producers located in a regulated area.
13-16 This price shall be established either as a compact over-order
13-17 price or by one or more commission marketing orders. Whenever such
13-18 a price has been established by either type of regulation, the
13-19 legal obligation to pay such price shall be determined solely by
13-20 the terms and purpose of the regulation without regard to the situs
13-21 of the transfer of title, possession, or any other factors not
13-22 related to the purposes of the regulation and this compact.
13-23 Producer-handlers as defined in an applicable federal market order
13-24 shall not be subject to a compact over-order price. The commission
13-25 shall provide for similar treatment of producer-handlers under
13-26 commission marketing orders.
13-27 (e) In determining the price, the commission shall consider
14-1 the balance between production and consumption of milk and milk
14-2 products in the regulated area, the costs of production including,
14-3 but not limited to, the price of feed, the cost of labor, including
14-4 the reasonable value of the producer's own labor and management,
14-5 machinery expense, and interest expense, the prevailing price for
14-6 milk outside the regulated area, the purchasing power of the
14-7 public, and the price necessary to yield a reasonable return to the
14-8 producer and distributor.
14-9 (f) When establishing a compact over-order price, the
14-10 commission shall take such other action as is necessary and
14-11 feasible to help ensure that the over-order price does not cause or
14-12 compensate producers so as to generate local production of milk in
14-13 excess of those quantities necessary to assure consumers of an
14-14 adequate supply for fluid purposes.
14-15 (g) The commission shall whenever possible enter into
14-16 agreements with state or federal agencies for exchange of
14-17 information or services for the purpose of reducing regulatory
14-18 burden and cost of administering the compact. The commission may
14-19 reimburse other agencies for the reasonable cost of providing these
14-20 services.
14-21 Sec. 10. OPTIONAL PROVISIONS FOR PRICING ORDER. Regulations
14-22 establishing a compact over-order price or a commission marketing
14-23 order may contain, but shall not be limited to, any of the
14-24 following:
14-25 (1) provisions classifying milk in accordance with the
14-26 form in which or purpose for which it is used, or creating a flat
14-27 pricing program;
15-1 (2) with respect to a commission marketing order only,
15-2 provisions establishing or providing a method for establishing
15-3 separate minimum prices for each use classification prescribed by
15-4 the commission, or a single minimum price for milk purchased from
15-5 producers or associations of producers;
15-6 (3) with respect to an over-order minimum price,
15-7 provisions establishing or providing a method for establishing such
15-8 minimum price for Class I milk;
15-9 (4) provisions for establishing either an over-order
15-10 price or a commission marketing order may make use of any
15-11 reasonable method for establishing such price or prices, including
15-12 flat pricing and formula pricing. Provision may also be made for
15-13 location adjustments, zone differentials, and for competitive
15-14 credits with respect to regulated handlers who market outside the
15-15 regulated area;
15-16 (5) provisions for the payment to all producers and
15-17 associations of producers delivering milk to all handlers of
15-18 uniform prices for all milk so delivered, irrespective of the uses
15-19 made of such milk by the individual handler to whom it is
15-20 delivered, or for the payment of producers delivering milk to the
15-21 same handler of uniform prices for all milk delivered by them;
15-22 (A) With respect to regulations establishing a
15-23 compact over-order price, the commission may establish one
15-24 equalization pool within the regulated area for the sole purpose of
15-25 equalizing returns to producers throughout the regulated area.
15-26 (B) With respect to any commission marketing
15-27 order, as defined in Section 2(3) of this compact, which replaces
16-1 one or more terminated federal orders or state dairy regulation,
16-2 the marketing area of now separate state or federal orders shall
16-3 not be merged without the affirmative consent of each state, voting
16-4 through its delegation, which is partly or wholly included within
16-5 any such new marketing area.
16-6 (6) provisions requiring persons who bring Class I
16-7 milk into the regulated area to make compensatory payments with
16-8 respect to all such milk to the extent necessary to equalize the
16-9 cost of milk purchased by handlers subject to a compact over-order
16-10 price or commission marketing order. No such provisions shall
16-11 discriminate against milk producers outside the regulated area.
16-12 The provisions for compensatory payments may require payment of the
16-13 difference between the Class I price required to be paid for such
16-14 milk in the state of production by a federal milk marketing order
16-15 or state dairy regulation and the Class I price established by the
16-16 compact over-order price or commission marketing order;
16-17 (7) provisions specially governing the pricing and
16-18 pooling of milk handled by partially regulated plants;
16-19 (8) provisions requiring that the account of any
16-20 person regulated under the compact over-order price shall be
16-21 adjusted for any payments made to or received by such persons with
16-22 respect to a producer settlement fund of any federal or state milk
16-23 marketing order or other state dairy regulation within the
16-24 regulated area;
16-25 (9) provisions requiring the payment by handlers of an
16-26 assessment to cover the costs of the administration and enforcement
16-27 of such order pursuant to Section 18(a), Article VII, of this
17-1 compact;
17-2 (10) provisions for reimbursement to participants of
17-3 the Women, Infants and Children Special Supplemental Food Program
17-4 of the United States Child Nutrition Act of 1966; and
17-5 (11) other provisions and requirements as the
17-6 commission may find are necessary or appropriate to effectuate the
17-7 purposes of this compact and to provide for the payment of fair and
17-8 equitable minimum prices to producers.
17-9 ARTICLE V. RULEMAKING PROCEDURE
17-10 Sec. 11. RULEMAKING PROCEDURE. Before promulgation of any
17-11 regulations establishing a compact over-order price or commission
17-12 marketing order, including any provision with respect to milk
17-13 supply under Section 9(f) of this compact, or amendment thereof, as
17-14 provided in Article IV of this compact, the commission shall
17-15 conduct an informal rulemaking proceeding to provide interested
17-16 persons with an opportunity to present data and views. Such
17-17 rulemaking proceeding shall be governed by Section 4, federal
17-18 Administrative Procedure Act (5 U.S.C. Section 553), as amended.
17-19 In addition, the commission shall, to the extent practicable,
17-20 publish notice of rulemaking proceedings in the official register
17-21 of each participating state. Before the initial adoption of
17-22 regulations establishing a compact over-order price or a commission
17-23 marketing order and thereafter before any amendment with regard to
17-24 prices or assessments, the commission shall hold a public hearing.
17-25 The commission may commence a rulemaking proceeding on its own
17-26 initiative or may in its sole discretion act upon the petition of
17-27 any person including individual milk producers, any organization of
18-1 milk producers or handlers, general farm organizations, consumer or
18-2 public interest groups, and local, state, or federal officials.
18-3 Sec. 12. FINDINGS AND REFERENDUM. In addition to the
18-4 concise general statement of basis and purpose required by Section
18-5 4(b), federal Administrative Procedure Act (5 U.S.C. Section 553
18-6 (c)), as amended, the commission shall make findings of fact with
18-7 respect to:
18-8 (1) whether the public interest will be served by the
18-9 establishment of minimum milk prices to dairy farmers under Article
18-10 IV of this compact;
18-11 (2) the level of prices that will assure that
18-12 producers receive a price sufficient to cover their costs of
18-13 production and will elicit an adequate supply of milk for the
18-14 inhabitants of the regulated area and for manufacturing purposes;
18-15 (3) whether the major provisions of the order, other
18-16 than those fixing minimum milk prices, are in the public interest
18-17 and are reasonably designed to achieve the purposes of the order;
18-18 and
18-19 (4) whether the terms of the proposed regional order
18-20 or amendment are approved by producers as provided in Section 13 of
18-21 this compact.
18-22 Sec. 13. PRODUCER REFERENDUM. (a) For the purpose of
18-23 ascertaining whether the issuance or amendment of regulations
18-24 establishing a compact over-order price or a commission marketing
18-25 order, including any provision with respect to milk supply under
18-26 Section 9(f) of this compact, is approved by producers, the
18-27 commission shall conduct a referendum among producers. The
19-1 referendum shall be held in a timely manner, as determined by
19-2 regulation of the commission. The terms and conditions of the
19-3 proposed order or amendment shall be described by the commission in
19-4 the ballot used in the conduct of the referendum, but the nature,
19-5 content, or extent of such description shall not be a basis for
19-6 attacking the legality of the order or any action relating thereto.
19-7 (b) An order or amendment shall be deemed approved by
19-8 producers if the commission determines that it is approved by at
19-9 least two-thirds of the voting producers who, during a
19-10 representative period determined by the commission, have been
19-11 engaged in the production of milk, the price of which would be
19-12 regulated under the proposed order or amendment.
19-13 (c) For purposes of any referendum, the commission shall
19-14 consider the approval or disapproval by any cooperative association
19-15 of producers, qualified under the provisions of the Act of Congress
19-16 of February 18, 1922, as amended, known as the Capper-Volstead Act,
19-17 bona fide engaged in marketing milk, or in rendering services for
19-18 or advancing the interests of producers of such commodity, as the
19-19 approval or disapproval of the producers who are members or
19-20 stockholders in, or under contract with, such cooperative
19-21 association of producers, except as provided in Subdivision (1) of
19-22 this subsection and subject to the provisions of Subdivisions (2)
19-23 through (5) of this subsection.
19-24 (1) No cooperative which has been formed to act as a
19-25 common marketing agency for both cooperatives and individual
19-26 producers shall be qualified to block vote for either.
19-27 (2) Any cooperative which is qualified to block vote
20-1 shall, before submitting its approval or disapproval in any
20-2 referendum, give prior written notice to each of its members as to
20-3 whether and how it intends to cast its vote. The notice shall be
20-4 given in a timely manner as established and in the form prescribed
20-5 by the commission.
20-6 (3) Any producer may obtain a ballot from the
20-7 commission in order to register approval or disapproval of the
20-8 proposed order.
20-9 (4) A producer who is a member of a cooperative which
20-10 has provided notice of its intent to approve or not to approve a
20-11 proposed order, and who obtains a ballot and with such ballot
20-12 expresses his approval or disapproval of the proposed order, shall
20-13 notify the commission as to the name of the cooperative of which he
20-14 or she is a member, and the commission shall remove such producer's
20-15 name from the list certified by such cooperative with its corporate
20-16 vote.
20-17 (5) In order to ensure that all milk producers are
20-18 informed regarding a proposed order, the commission shall notify
20-19 all milk producers that an order is being considered and that each
20-20 producer may register his approval or disapproval with the
20-21 commission either directly or through his or her cooperative.
20-22 Sec. 14. TERMINATION OF OVER-ORDER PRICE OR MARKETING ORDER.
20-23 (a) The commission shall terminate any regulations establishing an
20-24 over-order price or commission marketing order issued under this
20-25 article whenever it finds that such order or price obstructs or
20-26 does not tend to effectuate the declared policy of this compact.
20-27 (b) The commission shall terminate any regulations
21-1 establishing an over-order price or a commission marketing order
21-2 issued under this article whenever it finds that such termination
21-3 is favored by a majority of the producers who, during a
21-4 representative period determined by the commission, have been
21-5 engaged in the production of milk the price of which is regulated
21-6 by such order; but such termination shall be effective only if
21-7 announced on or before such date as may be specified in such
21-8 marketing agreement or order.
21-9 (c) The termination or suspension of any order or provision
21-10 thereof shall not be considered an order within the meaning of this
21-11 article and shall require no hearing but shall comply with the
21-12 requirements for informal rulemaking prescribed by Section 4,
21-13 federal Administrative Procedure Act (5 U.S.C. Section 553), as
21-14 amended.
21-15 ARTICLE VI. ENFORCEMENT
21-16 Sec. 15. RECORDS, REPORTS, ACCESS TO PREMISES. (a) The
21-17 commission may by rule and regulation prescribe recordkeeping and
21-18 reporting requirements for all regulated persons. For purposes of
21-19 the administration and enforcement of this compact, the commission
21-20 is authorized to examine the books and records of any regulated
21-21 person relating to his or her milk business, and for that purpose,
21-22 the commission's properly designated officers, employees, or agents
21-23 shall have full access during normal business hours to the premises
21-24 and records of all regulated persons.
21-25 (b) Information furnished to or acquired by commission
21-26 officers, employees, or agents pursuant to this section shall be
21-27 confidential and not subject to disclosure except to the extent
22-1 that the commission deems disclosure to be necessary in any
22-2 administrative or judicial proceeding involving the administration
22-3 or enforcement of this compact, an over-order price, a compact
22-4 marketing order, or other regulations of the commission. The
22-5 commission may promulgate regulations further defining the
22-6 confidentiality of information pursuant to this section. Nothing
22-7 in this section shall be deemed to prohibit (i) the issuance of
22-8 general statements based upon the reports of a number of handlers
22-9 which do not identify the information furnished by any person, or
22-10 (ii) the publication by direction of the commission of the name of
22-11 any person violating any regulation of the commission, together
22-12 with a statement of the particular provisions violated by such
22-13 person.
22-14 (c) No officer, employee, or agent of the commission shall
22-15 intentionally disclose information, by inference or otherwise,
22-16 which is made confidential pursuant to this section. Any person
22-17 violating the provisions of this section shall, upon conviction, be
22-18 subject to a fine of not more than $1,000 or to imprisonment for
22-19 not more than one year, or both, and shall be removed from office.
22-20 The commission shall refer any allegation of a violation of this
22-21 section to the appropriate state enforcement authority or the
22-22 United States Attorney.
22-23 Sec. 16. SUBPOENA, HEARINGS, AND JUDICIAL REVIEW. (a) The
22-24 commission is hereby authorized and empowered by its members and
22-25 its properly designated officers to administer oaths and issue
22-26 subpoenas throughout all signatory states to compel the attendance
22-27 of witnesses and the giving of testimony and the production of
23-1 other evidence.
23-2 (b) Any handler subject to an order may file a written
23-3 petition with the commission stating that any such order or any
23-4 provision of any such order or any obligation imposed in connection
23-5 therewith is not in accordance with law and praying for a
23-6 modification thereof or to be exempted therefrom. He shall
23-7 thereupon be given an opportunity for a hearing upon such petition,
23-8 in accordance with regulations made by the commission. After such
23-9 hearing, the commission shall make a ruling upon the prayer of such
23-10 petition which shall be final, if in accordance with law.
23-11 (c) The district courts of the United States in any district
23-12 in which such handler is an inhabitant, or has his principal place
23-13 of business, are hereby vested with jurisdiction to review such
23-14 ruling, provided a complaint for that purpose is filed within 30
23-15 days from the date of the entry of such ruling. Service of process
23-16 in such proceedings may be had upon the commission by delivering to
23-17 it a copy of the complaint. If the court determines that such
23-18 ruling is not in accordance with law, it shall remand such
23-19 proceedings to the commission with directions either (1) to make
23-20 such ruling as the court shall determine to be in accordance with
23-21 law, or (2) to take such further proceedings as, in its opinion,
23-22 the law requires. The pendency of proceedings instituted pursuant
23-23 to this subsection shall not impede, hinder, or delay the
23-24 commission from obtaining relief pursuant to Section 17 of this
23-25 compact. Any proceedings brought pursuant to Section 17 of this
23-26 compact, except where brought by way of counterclaim in proceedings
23-27 instituted pursuant to this section, shall abate whenever a final
24-1 decree has been rendered in proceedings between the same parties,
24-2 and covering the same subject matter, instituted pursuant to this
24-3 section.
24-4 Sec. 17. ENFORCEMENT WITH RESPECT TO HANDLERS. (a) Any
24-5 violation by a handler of the provisions of regulations
24-6 establishing an over-order price or a commission marketing order,
24-7 or other regulations adopted pursuant to this compact, shall:
24-8 (1) Constitute a violation of the laws of each of the
24-9 signatory states. Such violation shall render the violator subject
24-10 to a civil penalty in an amount as may be prescribed by the laws of
24-11 each of the participating states, recoverable in any state or
24-12 federal court of competent jurisdiction. Each day such violation
24-13 continues shall constitute a separate violation.
24-14 (2) Constitute grounds for the revocation of a license
24-15 or permit to engage in the milk business under the applicable laws
24-16 of the participating states.
24-17 (b) With respect to handlers, the commission shall enforce
24-18 the provisions of this compact, regulations establishing an
24-19 over-order price, a commission marketing order, or other
24-20 regulations adopted hereunder by:
24-21 (1) commencing an action for legal or equitable relief
24-22 brought in the name of the commission in any state or federal court
24-23 of competent jurisdiction; or
24-24 (2) referral to the state agency for enforcement by
24-25 judicial or administrative remedy with the agreement of the
24-26 appropriate state agency of a participating state.
24-27 (c) With respect to handlers, the commission may bring an
25-1 action for injunction to enforce the provisions of this compact or
25-2 the order or regulations adopted thereunder without being compelled
25-3 to allege or prove that an adequate remedy of law does not exist.
25-4 ARTICLE VII. FINANCE
25-5 Sec. 18. FINANCE OF START-UP AND REGULAR COSTS. (a) To
25-6 provide for its start-up costs, the commission may borrow money
25-7 pursuant to its general power under Section 6(d)(4) of this
25-8 compact. In order to finance the costs of administration and
25-9 enforcement of this compact, including payback of start-up costs,
25-10 the commission is hereby empowered to collect an assessment from
25-11 each handler who purchases milk from producers within the region.
25-12 If imposed, this assessment shall be collected on a monthly basis
25-13 for up to one year from the date the commission convenes, in an
25-14 amount not to exceed $.015 per hundredweight of milk purchased from
25-15 producers during the period of the assessment. The initial
25-16 assessment may apply to the projected purchases of handlers for the
25-17 two-month period following the date the commission convenes. In
25-18 addition, if regulations establishing an over-order price or a
25-19 compact marketing order are adopted, they may include an assessment
25-20 for the specific purpose of their administration. These
25-21 regulations shall provide for establishment of a reserve for the
25-22 commission's ongoing operating expenses.
25-23 (b) The commission shall not pledge the credit of any
25-24 participating state or of the United States. Notes issued by the
25-25 commission and all other financial obligations incurred by it shall
25-26 be its sole responsibility and no participating state or the United
25-27 States shall be liable therefor.
26-1 Sec. 19. AUDIT AND ACCOUNTS. (a) The commission shall keep
26-2 accurate accounts of all receipts and disbursements, which shall be
26-3 subject to the audit and accounting procedures established under
26-4 its rules. In addition, all receipts and disbursements of funds
26-5 handled by the commission shall be audited yearly by a qualified
26-6 public accountant and the report of the audit shall be included in
26-7 and become part of the annual report of the commission.
26-8 (b) The accounts of the commission shall be open at any
26-9 reasonable time for inspection by duly constituted officers of the
26-10 participating states and by any persons authorized by the
26-11 commission.
26-12 (c) Nothing contained in this article shall be construed to
26-13 prevent commission compliance with laws relating to audit or
26-14 inspection of accounts by or on behalf of any participating state
26-15 or of the United States.
26-16 ARTICLE VIII. ENTRY INTO FORCE; ADDITIONAL MEMBERS AND WITHDRAWAL
26-17 Sec. 20. ENTRY INTO FORCE; ADDITIONAL MEMBERS. The compact
26-18 shall enter into force effective when enacted into law by any three
26-19 states of the group of states composed of Alabama, Arkansas,
26-20 Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North
26-21 Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and
26-22 West Virginia and when the consent of the United States Congress
26-23 has been obtained.
26-24 Sec. 21. WITHDRAWAL FROM COMPACT. Any participating state
26-25 may withdraw from this compact by enacting a statute repealing the
26-26 same, but no such withdrawal shall take effect until one year after
26-27 notice in writing of the withdrawal is given to the commission and
27-1 the governors of all other participating states. No withdrawal
27-2 shall affect any liability already incurred by or chargeable to a
27-3 participating state before the time of such withdrawal.
27-4 Sec. 22. SEVERABILITY. If any part or provision of this
27-5 compact is adjudged invalid by any court, such judgment shall be
27-6 confined in its operation to the part or provision directly
27-7 involved in the controversy in which such judgment shall have been
27-8 rendered and shall not affect or impair the validity of the
27-9 remainder of this compact. In the event the United States Congress
27-10 consents to this compact subject to conditions, said conditions
27-11 shall not impair the validity of this compact when said conditions
27-12 are accepted by three or more compacting states. A compacting state
27-13 may accept the conditions of the United States Congress by
27-14 implementation of this compact.
27-15 SECTION 2. Section 12.020(c), Agriculture Code, is amended
27-16 to read as follows:
27-17 (c) The provisions of this code subject to this section and
27-18 the applicable penalty amounts are as follows:
27-19 Provision
27-20 Maximum
27-21 Penalty
27-22 Chapters 13, 14, 18, 61, 94, 95, 101,
27-23 $500
27-24 102, 103, 121, 125, 132, [and] 134, and 182
27-25 Subchapter B, Chapter 71
27-26 $2,000
27-27 Chapter 19
28-1 Chapters 75 and 76
28-2 Subchapters A and C, Chapter 71
28-3 Chapters 72, 73 and 74
28-4 $5,000.
28-5 SECTION 3. The importance of this legislation and the
28-6 crowded condition of the calendars in both houses create an
28-7 emergency and an imperative public necessity that the
28-8 constitutional rule requiring bills to be read on three several
28-9 days in each house be suspended, and this rule is hereby suspended,
28-10 and that this Act take effect and be in force from and after its
28-11 passage, and it is so enacted.