By Homer H.B. No. 1039
Line and page numbers may not match official copy.
Bill not drafted by TLC or Senate E&E.
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 shall appoint one delegate to this state's delegation
1-18 to the compact commission to serve at the pleasure of the
1-19 commissioner. The commissioner may appoint himself or herself as
1-20 the delegate under this subsection. If the commissioner appoints a
1-21 person other than the commissioner as a delegate, the
1-22 commissioner's appointee must be an employee of the department,
2-1 preferably an employee with experience with milk marketing and
2-2 stabilization. The delegate serving under this subsection shall
2-3 serve as chair of the delegation from this state.
2-4 (b) The governor shall appoint four delegates to this
2-5 state's delegation to the compact commission as follows:
2-6 (1) two delegates who must be dairy farmers engaged in
2-7 the production of milk at the time of appointment or reappointment;
2-8 (2) one delegate who must be a dairy processor engaged
2-9 in the production of milk at the time of appointment or
2-10 reappointment; and
2-11 (3) one delegate who must be a consumer
2-12 representative.
2-13 (c) Each delegate must be a resident and registered voter of
2-14 this state.
2-15 (d) A delegate is not an officer of this state by virtue of
2-16 holding the position of delegate.
2-17 Sec. 182.003. TERMS; REMOVAL; VACANCY. (a) Each delegate
2-18 serves a term of four years.
2-19 (b) Each delegate shall serve from the date of appointment
2-20 until a successor is appointed and qualified.
2-21 (c) An individual, including the commissioner serving as a
2-22 delegate, may not serve more than three consecutive terms as a
2-23 delegate.
2-24 (d) A delegate may be removed for cause.
2-25 Sec. 182.004. EFFECTIVE DATE OF COMPACT; SUNSET PROVISION.
2-26 (a) The compact shall become effective when:
3-1 (1) the governor has executed the compact on behalf of
3-2 this state and has filed a verified copy of the compact with the
3-3 secretary of state;
3-4 (2) the United States Congress has consented to the
3-5 compact; and
3-6 (3) two or more of the other states named in Section
3-7 20, Article VIII, of the compact, have ratified the compact in a
3-8 form substantially similar to that contained in Section 182.005.
3-9 (b) The governor shall take such action as may be necessary
3-10 to complete the exchange of official documents between this state
3-11 and any other state ratifying the compact.
3-12 (c) This state's delegation to the compact commission is
3-13 subject to Chapter 325, Government Code (Texas Sunset Act). Unless
3-14 continued in existence as provided by that chapter, the state's
3-15 delegation to the commission is abolished and this chapter expires
3-16 September 1, 2003.
3-17 Sec. 182.005. COMPACT TO BE ENTERED; TEXT. Subject to
3-18 Section 182.004, the Southern Dairy Compact is hereby entered into
3-19 and enacted into law as follows:
3-20 ARTICLE I. STATEMENT OF PURPOSE, FINDINGS, AND
3-21 DECLARATION OF POLICY
3-22 Sec. 1. STATEMENT OF PURPOSE, FINDINGS, AND DECLARATION OF
3-23 POLICY. The purpose of this compact is to recognize the interstate
3-24 character of the southern dairy industry and the prerogative of the
3-25 states under the United States Constitution to form an interstate
3-26 commission for the southern region. The mission of the commission
4-1 is to take such steps as are necessary to assure the continued
4-2 viability of dairy farming in the South, and to assure consumers of
4-3 an adequate, local supply of pure and wholesome milk.
4-4 The participating states find and declare that the dairy
4-5 industry is an essential agricultural activity of the South. Dairy
4-6 farms, and associated suppliers, marketers, processors, and
4-7 retailers, are an integral component of the region's economy.
4-8 Their ability to provide a stable, local supply of pure, wholesome
4-9 milk is a matter of great importance to the health and welfare of
4-10 the region.
4-11 The participating states further find that dairy farms are
4-12 essential and they are an integral part of the region's rural
4-13 communities. The farms preserve land for agricultural purposes and
4-14 provide needed economic stimuli for rural communities.
4-15 By entering into this compact, the participating states
4-16 affirm that their ability to regulate the price which southern
4-17 dairy farmers receive for their product is essential to the public
4-18 interest. Assurance of a fair and equitable price for dairy
4-19 farmers ensures their ability to provide milk to the market and the
4-20 vitality of the southern dairy industry, with all the associated
4-21 benefits.
4-22 Recent dramatic price fluctuations, with a pronounced
4-23 downward trend, threaten the viability and stability of the
4-24 southern dairy region. Historically, individual state regulatory
4-25 action had been an effective emergency remedy available to farmers
4-26 confronting a distressed market. The federal order system,
5-1 implemented by the Agricultural Marketing Agreement Act of 1937,
5-2 establishes only minimum prices paid to producers for raw milk,
5-3 without preempting the power of states to regulate milk prices
5-4 above the minimum levels so established.
5-5 In today's regional dairy marketplace, cooperative, rather
5-6 than individual state action, is needed to more effectively address
5-7 the market disarray. Under our constitutional system, properly
5-8 authorized states acting cooperatively may exercise more power to
5-9 regulate interstate commerce than they may assert individually
5-10 without such authority. For this reason, the participating states
5-11 invoke their authority to act in common agreement, with the consent
5-12 of the United States Congress, under the compact clause of the
5-13 United States Constitution.
5-14 In establishing their constitutional regulatory authority
5-15 over the region's fluid milk market by this compact, the
5-16 participating states declare their purpose that this compact
5-17 neither displace the federal order system nor encourage the merging
5-18 of federal orders. Specific provisions of the compact itself set
5-19 forth this basic principle.
5-20 Designed as a flexible mechanism able to adjust to changes in
5-21 a regulated marketplace, the compact also contains a contingency
5-22 provision should the federal order system be discontinued. In that
5-23 event, the interstate commission is authorized to regulate the
5-24 marketplace in replacement of the order system. This contingent
5-25 authority does not anticipate such a change, however, and should
5-26 not be so construed. It is only provided should developments in
6-1 the market other than establishment of this compact result in
6-2 discontinuance of the order system.
6-3 ARTICLE II. DEFINITIONS AND RULES OF CONSTRUCTION
6-4 Sec. 2. DEFINITIONS. For the purposes of this compact, and
6-5 of any supplemental or concurring legislation enacted pursuant
6-6 thereto, except as may be otherwise required by the context:
6-7 (1) "Class I milk" means milk disposed of in fluid
6-8 form or as a fluid milk product, subject to further definition in
6-9 accordance with the principles expressed in Section 3(b) of this
6-10 compact.
6-11 (2) "Commission" means the Southern Dairy Compact
6-12 Commission established by this compact.
6-13 (3) "Commission marketing order" means regulations
6-14 adopted by the commission pursuant to Sections 9 and 10 of this
6-15 compact in place of a terminated federal marketing order or state
6-16 dairy regulation. Such order may apply throughout the region or in
6-17 any part or parts thereof as defined in the regulations of the
6-18 commission. Such order may establish minimum prices for any or all
6-19 classes of milk.
6-20 (4) "Compact" means this interstate compact.
6-21 (5) "Compact over-order price" means a minimum price
6-22 required to be paid to producers for Class I milk established by
6-23 the commission in regulations adopted pursuant to Sections 9 and 10
6-24 of this compact, which is above the price established in federal
6-25 marketing orders or by state farm price regulation in the regulated
6-26 area. Such price may apply throughout the region or in any part or
7-1 parts thereof as defined in the regulations of the commission.
7-2 (6) "Milk" means the lacteal secretion of cows and
7-3 includes all skim, butterfat, or other constituents obtained from
7-4 separation or any other process. The term is used in its broadest
7-5 sense and may be further defined by the commission for regulatory
7-6 purposes.
7-7 (7) "Partially regulated plant" means a milk plant not
7-8 located in a regulated area but having Class I distribution within
7-9 such area. Commission regulations may exempt plants having such
7-10 distribution or receipts in amounts less than the limits defined
7-11 therein.
7-12 (8) "Participating state" means a state which has
7-13 become a party to this compact by the enactment of concurring
7-14 legislation.
7-15 (9) "Pool plant" means any milk plant located in a
7-16 regulated area.
7-17 (10) "Region" means the territorial limits of the
7-18 states which are parties to this compact.
7-19 (11) "Regulated area" means any area within the region
7-20 governed by and defined in regulations establishing a compact
7-21 over-order price or commission marketing order.
7-22 (12) "State dairy regulation" means any state
7-23 regulation of dairy prices, and associated assessments, whether by
7-24 statute, marketing order, or otherwise.
7-25 Sec. 3. RULES OF CONSTRUCTION. (a) This compact shall not
7-26 be construed to displace existing federal milk marketing orders or
8-1 state dairy regulation in the region but to supplement them. In
8-2 the event some or all federal orders in the region are
8-3 discontinued, the compact shall be construed to provide the
8-4 commission the option to replace them with one or more commission
8-5 marketing orders pursuant to this compact.
8-6 (b) This compact shall be construed liberally in order to
8-7 achieve the purposes and intent enunciated in Section 1 of this
8-8 compact. It is the intent of this compact to establish a basic
8-9 structure by which the commission may achieve those purposes
8-10 through the application, adaptation, and development of the
8-11 regulatory techniques historically associated with milk marketing
8-12 and to afford the commission broad flexibility to devise regulatory
8-13 mechanisms to achieve the purposes of this compact. In accordance
8-14 with this intent, the technical terms which are associated with
8-15 market order regulation and which have acquired commonly understood
8-16 general meanings are not defined herein, but the commission may
8-17 further define the terms used in this compact and develop
8-18 additional concepts and define additional terms as it may find
8-19 appropriate to achieve its purposes.
8-20 ARTICLE III. COMMISSION ESTABLISHED
8-21 Sec. 4. COMMISSION ESTABLISHED. There is hereby created a
8-22 commission to administer the compact, composed of delegations from
8-23 each state in the region. The commission shall be known as the
8-24 Southern Dairy Compact Commission. A delegation shall include not
8-25 less than three nor more than five persons. Each delegation shall
8-26 include at least one dairy farmer who is engaged in the production
9-1 of milk at the time of appointment or reappointment, and one
9-2 consumer representative. Delegation members shall be residents and
9-3 voters of, and subject to such confirmation process as is provided
9-4 for in, the appointing state. Delegation members shall serve no
9-5 more than three consecutive terms with no single term of more than
9-6 four years and be subject to removal for cause. In all other
9-7 respects, delegation members shall serve in accordance with the
9-8 laws of the state represented. The compensation, if any, of the
9-9 members of a state delegation shall be determined and paid by each
9-10 state, but their expenses shall be paid by the commission.
9-11 Sec. 5. VOTING REQUIREMENTS. All actions taken by the
9-12 commission, except for the establishment or termination of an
9-13 over-order price or commission marketing order, and the adoption,
9-14 amendment, or rescission of the commission's bylaws shall be by
9-15 majority vote of the delegations present. Each state delegation
9-16 shall be entitled to one vote in the conduct of the commission's
9-17 affairs. Establishment or termination of an over-order price or
9-18 commission marketing order shall require at least a two-thirds vote
9-19 of the delegations present. The establishment of a regulated area
9-20 which covers all or part of a participating state shall require
9-21 also the affirmative vote of that state's delegation. A majority
9-22 of the delegations from the participating states shall constitute a
9-23 quorum for the conduct of the commission's business.
9-24 Sec. 6. ADMINISTRATION AND MANAGEMENT. (a) The commission
9-25 shall elect annually from among the members of the participating
9-26 state delegations a chairperson, a vice-chairperson, and a
10-1 treasurer. The commission shall appoint an executive director and
10-2 fix his or her duties and compensation. The executive director
10-3 shall serve at the pleasure of the commission, and, together with
10-4 the treasurer, shall be bonded in an amount determined by the
10-5 commission. The commission may establish through its bylaws an
10-6 executive committee composed of one member elected by each
10-7 delegation.
10-8 (b) The commission shall adopt bylaws for the conduct of its
10-9 business by a two-thirds vote and shall have the power by the same
10-10 vote to amend and rescind these bylaws. The commission shall
10-11 publish its bylaws in convenient form with the appropriate agency
10-12 or officer in each of the participating states. The bylaws shall
10-13 provide for appropriate notice to the delegations of all commission
10-14 meetings and hearings and of the business to be transacted at such
10-15 meetings or hearings. Notice also shall be given to other agencies
10-16 or officers of participating states as provided by the laws of
10-17 those states.
10-18 (c) The commission shall file an annual report with the
10-19 secretary of agriculture of the United States, and with each of the
10-20 participating states by submitting copies to the governor, both
10-21 houses of the legislature, and the head of the state department
10-22 having responsibilities for agriculture.
10-23 (d) In addition to the powers and duties elsewhere
10-24 prescribed in this compact, the commission shall have the power:
10-25 (1) to sue and be sued in any state or federal court;
10-26 (2) to have a seal and alter the same at pleasure;
11-1 (3) to acquire, hold, and dispose of real and personal
11-2 property by gift, purchase, lease, license, or other similar
11-3 manner, for its corporate purposes;
11-4 (4) to borrow money and to issue notes, to provide for
11-5 the rights of the holders thereof and to pledge the revenue of the
11-6 commission as security therefore, subject to the provisions of
11-7 Section 18 of this compact;
11-8 (5) to appoint such officers, agents, and employees as
11-9 it may deem necessary and prescribe their powers, duties, and
11-10 qualifications; and
11-11 (6) to create and abolish such offices, employments,
11-12 and positions as it deems necessary for the purposes of the compact
11-13 and provide for the removal, term, tenure, compensation, fringe
11-14 benefits, pension, and retirement rights of its officers and
11-15 employees. The commission may also retain personal services on a
11-16 contract basis.
11-17 Sec. 7. RULEMAKING POWER. In addition to the power to
11-18 promulgate a compact over-order price or commission marketing
11-19 orders as provided by this compact, the commission is further
11-20 empowered to make and enforce such additional rules and regulations
11-21 as it deems necessary to implement any provisions of this compact,
11-22 or to effectuate in any other respect the purposes of this compact.
11-23 ARTICLE IV. POWERS OF THE COMMISSION
11-24 Sec. 8. POWERS TO PROMOTE REGULATORY UNIFORMITY, SIMPLICITY,
11-25 AND INTERSTATE COOPERATION. The commission is hereby empowered to:
11-26 (1) Investigate or provide for investigations or
12-1 research projects designed to review the existing laws and
12-2 regulations of the participating states, to consider their
12-3 administration and costs, and to measure their impact on the
12-4 production and marketing of milk and their effects on the shipment
12-5 of milk and milk products within the region.
12-6 (2) Study and recommend to the participating states
12-7 joint or cooperative programs for the administration of the dairy
12-8 marketing laws and regulations and to prepare estimates of cost
12-9 savings and benefits of such programs.
12-10 (3) Encourage the harmonious relationships between the
12-11 various elements in the industry for the solution of their material
12-12 problems. Conduct symposia or conferences designed to improve
12-13 industry relations or a better understanding of problems.
12-14 (4) Prepare and release periodic reports on activities
12-15 and results of the commission's efforts to the participating
12-16 states.
12-17 (5) Review the existing marketing system for milk and
12-18 milk products and recommend changes in the existing structure for
12-19 assembly and distribution of milk which may assist, improve, or
12-20 promote more efficient assembly and distribution of milk.
12-21 (6) Investigate costs and charges for producing,
12-22 hauling, handling, processing, distributing, selling, and for all
12-23 other services performed with respect to milk.
12-24 (7) Examine current economic forces affecting
12-25 producers, probable trends in production and consumption, the level
12-26 of dairy farm prices in relation to costs, the financial conditions
13-1 of dairy farmers, and the need for an emergency order to relieve
13-2 critical conditions on dairy farms.
13-3 Sec. 9. EQUITABLE FARM PRICES. (a) The powers granted in
13-4 this section and Section 10 of this compact shall apply only to the
13-5 establishment of a compact over-order price, so long as federal
13-6 milk marketing orders remain in effect in the region. In the event
13-7 that any or all such orders are terminated, this article shall
13-8 authorize the commission to establish one or more commission
13-9 marketing orders, as herein provided, in the region or parts
13-10 thereof as defined in the order.
13-11 (b) A compact over-order price established pursuant to this
13-12 section shall apply only to Class I milk. Such compact over-order
13-13 price shall not exceed $1.50 per gallon at Atlanta, Georgia;
13-14 however, this compact over-order price shall be adjusted upward or
13-15 downward at other locations in the region to reflect differences in
13-16 minimum federal order prices. Beginning in 1990, and using that
13-17 year as a base, the foregoing $1.50 per gallon maximum shall be
13-18 adjusted annually by the rate of change in the Consumer Price Index
13-19 as reported by the Bureau of Labor Statistics of the United States
13-20 Department of Labor. For purposes of the pooling and equalization
13-21 of an over-order price, the value of milk used in other use
13-22 classifications shall be calculated at the appropriate class price
13-23 established pursuant to the applicable federal order or state dairy
13-24 regulation, and the value of unregulated milk shall be calculated
13-25 in relation to the nearest prevailing class price in accordance
13-26 with and subject to such adjustments as the commission may
14-1 prescribe in regulations.
14-2 (c) A commission marketing order shall apply to all classes
14-3 and uses of milk.
14-4 (d) The commission is hereby empowered to establish a
14-5 compact over-order price for milk to be paid by pool plants and
14-6 partially regulated plants. The commission is also empowered to
14-7 establish a compact over-order price to be paid by all other
14-8 handlers receiving milk from producers located in a regulated area.
14-9 This price shall be established either as a compact over-order
14-10 price or by one or more commission marketing orders. Whenever such
14-11 a price has been established by either type of regulation, the
14-12 legal obligation to pay such price shall be determined solely by
14-13 the terms and purpose of the regulation without regard to the situs
14-14 of the transfer of title, possession, or any other factors not
14-15 related to the purposes of the regulation and this compact.
14-16 Producer-handlers as defined in an applicable federal market order
14-17 shall not be subject to a compact over-order price. The commission
14-18 shall provide for similar treatment of producer-handlers under
14-19 commission marketing orders.
14-20 (e) In determining the price, the commission shall consider
14-21 the balance between production and consumption of milk and milk
14-22 products in the regulated area, the costs of production including,
14-23 but not limited to, the price of feed, the cost of labor, including
14-24 the reasonable value of the producer's own labor and management,
14-25 machinery expense, and interest expense, the prevailing price for
14-26 milk outside the regulated area, the purchasing power of the
15-1 public, and the price necessary to yield a reasonable return to the
15-2 producer and distributor.
15-3 (f) When establishing a compact over-order price, the
15-4 commission shall take such other action as is necessary and
15-5 feasible to help ensure that the over-order price does not cause or
15-6 compensate producers so as to generate local production of milk in
15-7 excess of those quantities necessary to assure consumers of an
15-8 adequate supply for fluid purposes.
15-9 (g) The commission shall whenever possible enter into
15-10 agreements with state or federal agencies for exchange of
15-11 information or services for the purpose of reducing regulatory
15-12 burden and cost of administering the compact. The commission may
15-13 reimburse other agencies for the reasonable cost of providing these
15-14 services.
15-15 Sec. 10. OPTIONAL PROVISIONS FOR PRICING ORDER. Regulations
15-16 establishing a compact over-order price or a commission marketing
15-17 order may contain, but shall not be limited to, any of the
15-18 following:
15-19 (1) provisions classifying milk in accordance with the
15-20 form in which or purpose for which it is used, or creating a flat
15-21 pricing program;
15-22 (2) with respect to a commission marketing order only,
15-23 provisions establishing or providing a method for establishing
15-24 separate minimum prices for each use classification prescribed by
15-25 the commission, or a single minimum price for milk purchased from
15-26 producers or associations of producers;
16-1 (3) with respect to an over-order minimum price,
16-2 provisions establishing or providing a method for establishing such
16-3 minimum price for Class I milk;
16-4 (4) provisions for establishing either an over-order
16-5 price or a commission marketing order may make use of any
16-6 reasonable method for establishing such price or prices, including
16-7 flat pricing and formula pricing. Provision may also be made for
16-8 location adjustments, zone differentials, and for competitive
16-9 credits with respect to regulated handlers who market outside the
16-10 regulated area;
16-11 (5) provisions for the payment to all producers and
16-12 associations of producers delivering milk to all handlers of
16-13 uniform prices for all milk so delivered, irrespective of the uses
16-14 made of such milk by the individual handler to whom it is
16-15 delivered, or for the payment of producers delivering milk to the
16-16 same handler of uniform prices for all milk delivered by them;
16-17 (A) With respect to regulations establishing a
16-18 compact over-order price, the commission may establish one
16-19 equalization pool within the regulated area for the sole purpose of
16-20 equalizing returns to producers throughout the regulated area.
16-21 (B) With respect to any commission marketing
16-22 order, as defined in Section 2(3) of this compact, which replaces
16-23 one or more terminated federal orders or state dairy regulation,
16-24 the marketing area of now separate state or federal orders shall
16-25 not be merged without the affirmative consent of each state, voting
16-26 through its delegation, which is partly or wholly included within
17-1 any such new marketing area.
17-2 (6) provisions requiring persons who bring Class I
17-3 milk into the regulated area to make compensatory payments with
17-4 respect to all such milk to the extent necessary to equalize the
17-5 cost of milk purchased by handlers subject to a compact over-order
17-6 price or commission marketing order. No such provisions shall
17-7 discriminate against milk producers outside the regulated area.
17-8 The provisions for compensatory payments may require payment of the
17-9 difference between the Class I price required to be paid for such
17-10 milk in the state of production by a federal milk marketing order
17-11 or state dairy regulation and the Class I price established by the
17-12 compact over-order price or commission marketing order;
17-13 (7) provisions specially governing the pricing and
17-14 pooling of milk handled by partially regulated plants;
17-15 (8) provisions requiring that the account of any
17-16 person regulated under the compact over-order price shall be
17-17 adjusted for any payments made to or received by such persons with
17-18 respect to a producer settlement fund of any federal or state milk
17-19 marketing order or other state dairy regulation within the
17-20 regulated area;
17-21 (9) provisions requiring the payment by handlers of an
17-22 assessment to cover the costs of the administration and enforcement
17-23 of such order pursuant to Section 18(a), Article VII, of this
17-24 compact;
17-25 (10) provisions for reimbursement to participants of
17-26 the Women, Infants and Children Special Supplemental Food Program
18-1 of the United States Child Nutrition Act of 1966; and
18-2 (11) other provisions and requirements as the
18-3 commission may find are necessary or appropriate to effectuate the
18-4 purposes of this compact and to provide for the payment of fair and
18-5 equitable minimum prices to producers.
18-6 ARTICLE V. RULEMAKING PROCEDURE
18-7 Sec. 11. RULEMAKING PROCEDURE. Before promulgation of any
18-8 regulations establishing a compact over-order price or commission
18-9 marketing order, including any provision with respect to milk
18-10 supply under Section 9(f) of this compact, or amendment thereof, as
18-11 provided in Article IV of this compact, the commission shall
18-12 conduct an informal rulemaking proceeding to provide interested
18-13 persons with an opportunity to present data and views. Such
18-14 rulemaking proceeding shall be governed by Section 4, federal
18-15 Administrative Procedure Act (5 U.S.C. Section 553), as amended.
18-16 In addition, the commission shall, to the extent practicable,
18-17 publish notice of rulemaking proceedings in the official register
18-18 of each participating state. Before the initial adoption of
18-19 regulations establishing a compact over-order price or a commission
18-20 marketing order and thereafter before any amendment with regard to
18-21 prices or assessments, the commission shall hold a public hearing.
18-22 The commission may commence a rulemaking proceeding on its own
18-23 initiative or may in its sole discretion act upon the petition of
18-24 any person including individual milk producers, any organization of
18-25 milk producers or handlers, general farm organizations, consumer or
18-26 public interest groups, and local, state, or federal officials.
19-1 Sec. 12. FINDINGS AND REFERENDUM. In addition to the concise
19-2 general statement of basis and purpose required by Section 4(b),
19-3 federal Administrative Procedure Act (5 U.S.C. Section 553 (c)), as
19-4 amended, the commission shall make findings of fact with respect
19-5 to:
19-6 (1) whether the public interest will be served by the
19-7 establishment of minimum milk prices to dairy farmers under Article
19-8 IV of this compact;
19-9 (2) the level of prices that will assure that
19-10 producers receive a price sufficient to cover their costs of
19-11 production and will elicit an adequate supply of milk for the
19-12 inhabitants of the regulated area and for manufacturing purposes;
19-13 (3) whether the major provisions of the order, other
19-14 than those fixing minimum milk prices, are in the public interest
19-15 and are reasonably designed to achieve the purposes of the order;
19-16 and
19-17 (4) whether the terms of the proposed regional order
19-18 or amendment are approved by producers as provided in Section 13 of
19-19 this compact.
19-20 Sec. 13. PRODUCER REFERENDUM. (a) For the purpose of
19-21 ascertaining whether the issuance or amendment of regulations
19-22 establishing a compact over-order price or a commission marketing
19-23 order, including any provision with respect to milk supply under
19-24 Section 9(f) of this compact, is approved by producers, the
19-25 commission shall conduct a referendum among producers. The
19-26 referendum shall be held in a timely manner, as determined by
20-1 regulation of the commission. The terms and conditions of the
20-2 proposed order or amendment shall be described by the commission in
20-3 the ballot used in the conduct of the referendum, but the nature,
20-4 content, or extent of such description shall not be a basis for
20-5 attacking the legality of the order or any action relating thereto.
20-6 (b) An order or amendment shall be deemed approved by
20-7 producers if the commission determines that it is approved by at
20-8 least two-thirds of the voting producers who, during a
20-9 representative period determined by the commission, have been
20-10 engaged in the production of milk, the price of which would be
20-11 regulated under the proposed order or amendment.
20-12 (c) For purposes of any referendum, the commission shall
20-13 consider the approval or disapproval by any cooperative association
20-14 of producers, qualified under the provisions of the Act of Congress
20-15 of February 18, 1922, as amended, known as the Capper-Volstead Act,
20-16 bona fide engaged in marketing milk, or in rendering services for
20-17 or advancing the interests of producers of such commodity, as the
20-18 approval or disapproval of the producers who are members or
20-19 stockholders in, or under contract with, such cooperative
20-20 association of producers, except as provided in Subdivision (1) of
20-21 this subsection and subject to the provisions of Subdivisions (2)
20-22 through (5) of this subsection.
20-23 (1) No cooperative which has been formed to act as a
20-24 common marketing agency for both cooperatives and individual
20-25 producers shall be qualified to block vote for either.
20-26 (2) Any cooperative which is qualified to block vote
21-1 shall, before submitting its approval or disapproval in any
21-2 referendum, give prior written notice to each of its members as to
21-3 whether and how it intends to cast its vote. The notice shall be
21-4 given in a timely manner as established and in the form prescribed
21-5 by the commission.
21-6 (3) Any producer may obtain a ballot from the
21-7 commission in order to register approval or disapproval of the
21-8 proposed order.
21-9 (4) A producer who is a member of a cooperative which
21-10 has provided notice of its intent to approve or not to approve a
21-11 proposed order, and who obtains a ballot and with such ballot
21-12 expresses his approval or disapproval of the proposed order, shall
21-13 notify the commission as to the name of the cooperative of which he
21-14 or she is a member, and the commission shall remove such producer's
21-15 name from the list certified by such cooperative with its corporate
21-16 vote.
21-17 (5) In order to ensure that all milk producers are
21-18 informed regarding a proposed order, the commission shall notify
21-19 all milk producers that an order is being considered and that each
21-20 producer may register his approval or disapproval with the
21-21 commission either directly or through his or her cooperative.
21-22 Sec. 14. TERMINATION OF OVER-ORDER PRICE OR MARKETING ORDER.
21-23 (a) The commission shall terminate any regulations establishing an
21-24 over-order price or commission marketing order issued under this
21-25 article whenever it finds that such order or price obstructs or
21-26 does not tend to effectuate the declared policy of this compact.
22-1 (b) The commission shall terminate any regulations
22-2 establishing an over-order price or a commission marketing order
22-3 issued under this article whenever it finds that such termination
22-4 is favored by a majority of the producers who, during a
22-5 representative period determined by the commission, have been
22-6 engaged in the production of milk the price of which is regulated
22-7 by such order; but such termination shall be effective only if
22-8 announced on or before such date as may be specified in such
22-9 marketing agreement or order.
22-10 (c) The termination or suspension of any order or provision
22-11 thereof shall not be considered an order within the meaning of this
22-12 article and shall require no hearing but shall comply with the
22-13 requirements for informal rulemaking prescribed by Section 4,
22-14 federal Administrative Procedure Act (5 U.S.C. Section 553), as
22-15 amended.
22-16 ARTICLE VI. ENFORCEMENT
22-17 Sec. 15. RECORDS, REPORTS, ACCESS TO PREMISES. (a) The
22-18 commission may by rule and regulation prescribe recordkeeping and
22-19 reporting requirements for all regulated persons. For purposes of
22-20 the administration and enforcement of this compact, the commission
22-21 is authorized to examine the books and records of any regulated
22-22 person relating to his or her milk business, and for that purpose,
22-23 the commission's properly designated officers, employees, or agents
22-24 shall have full access during normal business hours to the premises
22-25 and records of all regulated persons.
22-26 (b) Information furnished to or acquired by commission
23-1 officers, employees, or agents pursuant to this section shall be
23-2 confidential and not subject to disclosure except to the extent
23-3 that the commission deems disclosure to be necessary in any
23-4 administrative or judicial proceeding involving the administration
23-5 or enforcement of this compact, an over-order price, a compact
23-6 marketing order, or other regulations of the commission. The
23-7 commission may promulgate regulations further defining the
23-8 confidentiality of information pursuant to this section. Nothing
23-9 in this section shall be deemed to prohibit (i) the issuance of
23-10 general statements based upon the reports of a number of handlers
23-11 which do not identify the information furnished by any person, or
23-12 (ii) the publication by direction of the commission of the name of
23-13 any person violating any regulation of the commission, together
23-14 with a statement of the particular provisions violated by such
23-15 person.
23-16 (c) No officer, employee, or agent of the commission shall
23-17 intentionally disclose information, by inference or otherwise,
23-18 which is made confidential pursuant to this section. Any person
23-19 violating the provisions of this section shall, upon conviction, be
23-20 subject to a fine of not more than $1,000 or to imprisonment for
23-21 not more than one year, or both, and shall be removed from office.
23-22 The commission shall refer any allegation of a violation of this
23-23 section to the appropriate state enforcement authority or the
23-24 United States Attorney.
23-25 Sec. 16. SUBPOENA, HEARINGS, AND JUDICIAL REVIEW. (a) The
23-26 commission is hereby authorized and empowered by its members and
24-1 its properly designated officers to administer oaths and issue
24-2 subpoenas throughout all signatory states to compel the attendance
24-3 of witnesses and the giving of testimony and the production of
24-4 other evidence.
24-5 (b) Any handler subject to an order may file a written
24-6 petition with the commission stating that any such order or any
24-7 provision of any such order or any obligation imposed in connection
24-8 therewith is not in accordance with law and praying for a
24-9 modification thereof or to be exempted therefrom. He shall
24-10 thereupon be given an opportunity for a hearing upon such petition,
24-11 in accordance with regulations made by the commission. After such
24-12 hearing, the commission shall make a ruling upon the prayer of such
24-13 petition which shall be final, if in accordance with law.
24-14 (c) The district courts of the United States in any district
24-15 in which such handler is an inhabitant, or has his principal place
24-16 of business, are hereby vested with jurisdiction to review such
24-17 ruling, provided a complaint for that purpose is filed within 30
24-18 days from the date of the entry of such ruling. Service of process
24-19 in such proceedings may be had upon the commission by delivering to
24-20 it a copy of the complaint. If the court determines that such
24-21 ruling is not in accordance with law, it shall remand such
24-22 proceedings to the commission with directions either (1) to make
24-23 such ruling as the court shall determine to be in accordance with
24-24 law, or (2) to take such further proceedings as, in its opinion,
24-25 the law requires. The pendency of proceedings instituted pursuant
24-26 to this subsection shall not impede, hinder, or delay the
25-1 commission from obtaining relief pursuant to Section 17 of this
25-2 compact. Any proceedings brought pursuant to Section 17 of this
25-3 compact, except where brought by way of counterclaim in proceedings
25-4 instituted pursuant to this section, shall abate whenever a final
25-5 decree has been rendered in proceedings between the same parties,
25-6 and covering the same subject matter, instituted pursuant to this
25-7 section.
25-8 Sec. 17. ENFORCEMENT WITH RESPECT TO HANDLERS. (a) Any
25-9 violation by a handler of the provisions of regulations
25-10 establishing an over-order price or a commission marketing order,
25-11 or other regulations adopted pursuant to this compact, shall:
25-12 (1) Constitute a violation of the laws of each of the
25-13 signatory states. Such violation shall render the violator subject
25-14 to a civil penalty in an amount as may be prescribed by the laws of
25-15 each of the participating states, recoverable in any state or
25-16 federal court of competent jurisdiction. Each day such violation
25-17 continues shall constitute a separate violation.
25-18 (2) Constitute grounds for the revocation of a license
25-19 or permit to engage in the milk business under the applicable laws
25-20 of the participating states.
25-21 (b) With respect to handlers, the commission shall enforce
25-22 the provisions of this compact, regulations establishing an
25-23 over-order price, a commission marketing order, or other
25-24 regulations adopted hereunder by:
25-25 (1) commencing an action for legal or equitable relief
25-26 brought in the name of the commission in any state or federal court
26-1 of competent jurisdiction; or
26-2 (2) referral to the state agency for enforcement by
26-3 judicial or administrative remedy with the agreement of the
26-4 appropriate state agency of a participating state.
26-5 (c) With respect to handlers, the commission may bring an
26-6 action for injunction to enforce the provisions of this compact or
26-7 the order or regulations adopted thereunder without being compelled
26-8 to allege or prove that an adequate remedy of law does not exist.
26-9 ARTICLE VII. FINANCE
26-10 Sec. 18. FINANCE OF START-UP AND REGULAR COSTS. (a) To
26-11 provide for its start-up costs, the commission may borrow money
26-12 pursuant to its general power under Section 6(d)(4) of this
26-13 compact. In order to finance the costs of administration and
26-14 enforcement of this compact, including payback of start-up costs,
26-15 the commission is hereby empowered to collect an assessment from
26-16 each handler who purchases milk from producers within the region.
26-17 If imposed, this assessment shall be collected on a monthly basis
26-18 for up to one year from the date the commission convenes, in an
26-19 amount not to exceed $.015 per hundredweight of milk purchased from
26-20 producers during the period of the assessment. The initial
26-21 assessment may apply to the projected purchases of handlers for the
26-22 two-month period following the date the commission convenes. In
26-23 addition, if regulations establishing an over-order price or a
26-24 compact marketing order are adopted, they may include an assessment
26-25 for the specific purpose of their administration. These
26-26 regulations shall provide for establishment of a reserve for the
27-1 commission's ongoing operating expenses.
27-2 (b) The commission shall not pledge the credit of any
27-3 participating state or of the United States. Notes issued by the
27-4 commission and all other financial obligations incurred by it shall
27-5 be its sole responsibility and no participating state or the United
27-6 States shall be liable therefor.
27-7 Sec. 19. AUDIT AND ACCOUNTS. (a) The commission shall keep
27-8 accurate accounts of all receipts and disbursements, which shall be
27-9 subject to the audit and accounting procedures established under
27-10 its rules. In addition, all receipts and disbursements of funds
27-11 handled by the commission shall be audited yearly by a qualified
27-12 public accountant and the report of the audit shall be included in
27-13 and become part of the annual report of the commission.
27-14 (b) The accounts of the commission shall be open at any
27-15 reasonable time for inspection by duly constituted officers of the
27-16 participating states and by any persons authorized by the
27-17 commission.
27-18 (c) Nothing contained in this article shall be construed to
27-19 prevent commission compliance with laws relating to audit or
27-20 inspection of accounts by or on behalf of any participating state
27-21 or of the United States.
27-22 ARTICLE VIII. ENTRY INTO FORCE; ADDITIONAL MEMBERS AND
27-23 WITHDRAWAL
27-24 Sec. 20. ENTRY INTO FORCE; ADDITIONAL MEMBERS. The compact
27-25 shall enter into force effective when enacted into law by any three
27-26 states of the group of states composed of Alabama, Arkansas,
28-1 Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North
28-2 Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and
28-3 West Virginia and when the consent of the United States Congress
28-4 has been obtained.
28-5 Sec. 21. WITHDRAWAL FROM COMPACT. Any participating state
28-6 may withdraw from this compact by enacting a statute repealing the
28-7 same, but no such withdrawal shall take effect until one year after
28-8 notice in writing of the withdrawal is given to the commission and
28-9 the governors of all other participating states. No withdrawal
28-10 shall affect any liability already incurred by or chargeable to a
28-11 participating state before the time of such withdrawal.
28-12 Sec. 22. SEVERABILITY. If any part or provision of this
28-13 compact is adjudged invalid by any court, such judgment shall be
28-14 confined in its operation to the part or provision directly
28-15 involved in the controversy in which such judgment shall have been
28-16 rendered and shall not affect or impair the validity of the
28-17 remainder of this compact. In the event the United States Congress
28-18 consents to this compact subject to conditions, said conditions
28-19 shall not impair the validity of this compact when said conditions
28-20 are accepted by three or more compacting states. A compacting
28-21 state may accept the conditions of the United States Congress by
28-22 implementation of this compact.
28-23 SECTION 2. Section 12.020(c), Agriculture Code, is amended to
28-24 read as follows:
28-25 (c) The provisions of this code subject to this section and
28-26 the applicable penalty amounts are as follows:
29-1 Provision Maximum Penalty
29-2 Chapters 13, 14, 18, 61, 94, 95, 101, $500
29-3 102, 103, 121, 125, 132, [and] 134, and 182
29-4 Subchapter B, Chapter 71 $2,000
29-5 Chapter 19
29-6 Chapters 75 and 76
29-7 Subchapters A and C, Chapter 71
29-8 Chapters 72, 73 and 74 $5,000.
29-9 SECTION 3. The importance of this legislation and the crowded
29-10 condition of the calendars in both houses create an emergency and
29-11 an imperative public necessity that the constitutional rule
29-12 requiring bills to be read on three several days in each house be
29-13 suspended, and this rule is hereby suspended, and that this Act
29-14 take effect and be in force from and after its passage, and it is
29-15 so enacted.