PRINTER'S NO.  2218

  

THE GENERAL ASSEMBLY OF PENNSYLVANIA

  

SENATE BILL

 

No.

1480

Session of

2010

  

  

INTRODUCED BY BRUBAKER, SEPTEMBER 24, 2010

  

  

REFERRED TO AGRICULTURE AND RURAL AFFAIRS, SEPTEMBER 24, 2010  

  

  

  

AN ACT

  

1

Amending the act of April 28, 1937 (P.L.417, No.105), entitled,

2

as amended, "An act relating to milk and the products

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thereof; creating a Milk Marketing Board; establishing its

4

jurisdiction, powers and duties; regulating the production,

5

transportation, manufacturing, processing, storage,

6

distribution, delivery and sale of milk and certain products

7

thereof; providing for the licensing of milk dealers and the

8

payment of fees therefor; requiring milk dealers to file

9

bonds to secure payment for milk to producers and certain

10

milk dealers; authorizing the holding of hearings and the

11

issuance of subpoenas by the board; conferring jurisdiction

12

upon courts to punish contempts and to prohibit violations of

13

this act and of rules, regulations and orders of the board;

14

authorizing the board to adopt rules, regulations and orders,

15

and to enter into interstate and Federal compacts; requiring

16

persons who weigh, measure, sample or test milk to procure

17

permits or certificates, to take examinations, to pay fees

18

therefor, to furnish certain notices, records and statements,

19

and to use certain methods of weighing, measuring, sampling

20

and testing; authorizing the board to examine the business,

21

papers and premises of milk dealers and producers, requiring

22

the keeping of records and the filing of reports by milk

23

dealers, and permitting, with limitations, the use of

24

information obtained thereby; authorizing the board to fix

25

prices for milk and certain milk products subject to the

26

approval of the Governor, and conferring certain powers upon

27

the Governor with respect thereto; providing for appeals to

28

the courts from decisions of the board, and for the burden of

29

proof upon such appeals; prescribing penalties, fines and

30

imprisonment for violations of this act and rules,

31

regulations and orders of the board; defining perjury;

32

defining remedies; repealing legislation supplied and

33

superseded by this act, and saving rights, duties and

34

proceedings thereunder; and making appropriations," further

35

providing for definitions, for appointment and terms of

 


1

members and quorum, for requisites of orders fixing price of

2

milk and for prices to producers; providing for title to

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milk; further providing for price increases, for expenses and

4

for payment; establishing the Producer Settlement Fund; and

5

repealing provisions relating to the Joint Study Commission.

6

The General Assembly of the Commonwealth of Pennsylvania

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hereby enacts as follows:

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Section 1.  The definitions of "board," "milk components" and

9

"milk dealer" or "handler" in section 103 of the act of April

10

28, 1937 (P.L.417, No.105), known as the Milk Marketing Law,

11

amended December 21, 1984 (P.L.1278, No.243), are amended and

12

the section is amended by adding a definition to read:

13

Section 103.  Definitions; Construction.--The following terms

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shall be construed in this act to have the following meanings,

15

except in those instances where the context clearly indicates

16

otherwise:

17

* * *

18

"Board" means the State agency created by this act, to be

19

known as the "Milk [Marketing] Control Board."

20

* * *

21

"Milk components" means the components of milk, including

22

butterfat and any other components, for which the prices of

23

handlers, producers or both are established by marketing

24

agreements or orders issued under the Agricultural Marketing

25

Agreement Act of 1937 (7 U.S.C. 601, et seq.) and which the Milk

26

[Marketing] Control Board determines by regulation are

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applicable to the marketing areas established under this act.

28

"Milk dealer" or "handler" means any person, including any

29

store or subdealer or subhandler, who purchases or receives or

30

handles on consignment or otherwise milk within the

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Commonwealth, for sale, shipment, storage, processing or

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manufacture [and further sale], within or without the

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1

Commonwealth, whether on behalf of himself or others, or both. A

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producer who delivers milk to a milk dealer or handler only

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shall not be deemed a milk dealer or handler. If a cooperative

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distributes or makes available on consignment or otherwise milk

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within this Commonwealth to stores, as defined in this act, or

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to consumers, as defined in this act, or to other milk dealers

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or handlers, as defined in this act, or acts as an agent for its

8

members, it shall be deemed to be a milk dealer or handler as to

9

that part of its business, and shall be governed by the

10

provisions of this act applicable thereto. Such cooperative

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shall be governed by the applicable provisions of this act as to

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the prices at which it sells, markets, or bargains to sell or

13

make available on consignment or otherwise milk within this

14

Commonwealth to milk dealers, handlers and others.

15

* * *

16

"Qualified producer" means a Pennsylvania producer whose milk

17

is purchased or processed as fluid or manufactured products.

18

Notwithstanding any other provision of this act to the contrary,

19

the term does not include a cooperative.

20

* * *

21

Section 2.  Sections 201, 801 and 803 of the act, amended

22

December 21, 1984 (P.L.1278, No.243), are amended to read:

23

Section 201.  Appointment and Terms of Members; Quorum.--

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There is hereby created an independent administrative board to

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be known as the Milk [Marketing] Control Board. The board shall

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consist of [three] five members, three of whom shall be 

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nominated and appointed by the Governor, by and with the advice

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and consent of [two-thirds] a majority of all the members of the

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Senate, and two of whom shall be appointed, one each by the

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President pro tempore of the Senate and the Speaker of the House

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of Representatives. Members of the board shall serve for terms

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of [six (6)] four (4) years each, and until their successors

3

shall have been appointed and qualified[; except that the terms

4

of the members first taking office shall expire May first, one

5

thousand nine hundred thirty-nine, May first, one thousand nine

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hundred forty-one, and May first, one thousand nine hundred

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forty-three, respectively, as designated by the Governor at the

8

time of appointment and until their successors shall have been

9

appointed and qualified]. Of the members appointed [after the

10

effective date of this amending act] by the Governor, one shall

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be appointed to represent consumer interests and shall have the

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responsibility under the direction of the board for directing

13

the executive secretary to coordinate and supervise the Bureau

14

of Consumer Affairs. A least three members of the board shall be

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current or former Pennsylvania producers.

16

The Governor shall designate one of the members of the board

17

as chairman. The chairman shall, when present, preside at all

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meetings and price hearings, and in his absence a member

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designated by the chairman shall preside. When presiding at a

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price hearing, the chairman or acting chairman shall have the

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status of agency head for the purpose of conducting the hearing.

22

[Two] Three members of the board shall constitute a quorum,

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and any action or order of the board shall require the approval

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of at least [two] three members.

25

The Governor may remove any board member for inefficiency,

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neglect of duty, loss of qualification as provided in section

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202 or misconduct in office: Provided, That he is given a copy

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of the charges against him and an opportunity to be publicly

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heard in person or by counsel in his own defense upon not less

30

than ten days' notice, and that the Governor file with the

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Department of State a complete statement of all charges made

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against such board member, together with a complete record of

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the proceedings and his findings thereon.

4

Section 801.  Requisites of Orders Fixing Price of Milk.--The

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board shall ascertain, after a hearing in which all interested

6

persons shall be given reasonable opportunity to be heard, the

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logical and reasonable milk marketing areas within the

8

Commonwealth, shall describe the territorial extent thereof,

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shall designate such areas by name or number, and shall

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ascertain and maintain such prices paid to producers, to dealers

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and to stores for milk in the respective milk marketing areas as

12

will be most beneficial to the public interest, best protect the

13

milk industry of the Commonwealth and insure a sufficient

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quantity of pure and wholesome milk to inhabitants of the

15

Commonwealth, having special regard to the health and welfare of

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children residing therein.

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The board shall base all prices upon all conditions affecting

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the milk industry in each milk marketing area, including the

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amount necessary to yield a reasonable return to the producer,

20

which return shall not be less than the cost of production and a

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reasonable profit to the producer, of the quantity of milk

22

necessary to supply the consumer demand for fluid milk plus a

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reasonable reserve supply as determined by the board, and a

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reasonable return on aggregate milk sales by milk dealers or

25

handlers and stores selling milk. A reasonable return shall mean

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not less than a two and one-half percent (2 1/2%) nor more than

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a three and one-half percent (3 1/2%) rate of return based on

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net sales of price-controlled products determined in accordance

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with generally accepted accounting principles. [However, where

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the board determines that the market for Pennsylvania produced

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milk is threatened it may establish producer prices designed to

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market the milk.] In ascertaining such returns, the board shall

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utilize available information concerning producers' cost of

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production and a cross-section representative of producers,

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dealers and stores in the area and shall consider unit costs of

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various types of products and of various sizes of containers.

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The board shall file at its office, with each order issued, a

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general statement in writing of the findings of fact in support

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of, and the reasons for such order.

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The board may, upon its own motion or upon application in

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writing, from time to time, alter, revise or amend an official

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order defining milk marketing areas or fixing prices to be

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charged or paid for milk. Before making, revising or amending

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any order defining milk marketing areas or fixing prices to be

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charged or paid for milk, the board shall hold a hearing, after

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giving reasonable opportunity to be heard to interested persons,

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of whom the board has notice, and, in the case of any order

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affecting the public, after giving reasonable notice thereof to

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the public in such newspaper or newspapers as, in the judgment

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of the board, shall afford sufficient notice and publicity:

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Provided, however, That after such hearing, there shall be a

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further hearing or conference before the board on any proposed

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order, and notice of such further hearing or conference shall be

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given to the parties represented and heard at the previous

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hearing. Upon application in writing from a person aggrieved by

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an order of the board hereunder, filed within fifteen (15) days

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after the issuance of the order complained of, or upon its own

28

motion, the board may, within twenty (20) days after the

29

effective date of such order, issue an order revising or

30

amending such order without a further hearing, if such revision

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or amendment is based on the record of the hearing held prior to

2

the issuance of such order.

3

"Interested persons," as used in this section, means all

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persons who may be affected by an order of the board fixing

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prices, and who have signified to the board in writing their

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desire to be notified of such hearings concerning a particular

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milk market area or areas within the Commonwealth. "Reasonable

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opportunity to be heard" may be afforded by written notice

9

addressed to the last known address of an interested party by

10

mail, postage prepaid, by deposit in a United States post office

11

or any receptacle thereof. Nothing contained in this section

12

shall be construed to limit or modify the provisions of section

13

three hundred eight of this act relating to the posting and

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publicizing of orders of the board, including orders made under

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this article and the force and effect thereof.

16

At any hearing provided for herein the testimony of an expert

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statistician present at the hearing and any printed,

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typewritten, duplicated, mimeographed or other written treatise,

19

report or statistical data by an expert not present as a

20

witness, if and to the extent it is endorsed as reliable to an

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expert witness present at the hearing, shall be competent

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evidence on any subject material to fixing any price under this

23

article. However, the testimony, treatise, report or data must

24

result from a study of facts and conditions in the milk

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marketing area which is the subject of the hearing.

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All provisions of all price-fixing orders of the board shall

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be presumed to be valid, and the burden of proving any

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invalidity of any provisions thereof shall be upon the person

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asserting the same. Any determination by the board, or a court

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to which an appeal has been taken, that the wholesale or retail

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1

prices provided are invalid shall not prevent the enforcement of

2

prices to producers, but any determination that prices to

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producers are unreasonable shall require the redetermination by

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the board of wholesale and retail prices as well as prices to

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producers.

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Whenever an order of the board fixing prices is remitted to

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the board with directions to reform the findings or order in

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accordance with the opinion of the court, and no further appeal

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is taken by the board, the board shall make such reformation

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within thirty days from the entry of the order of the court

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remitting the price-fixing order to the board.

12

Section 803.  Prices to Producers.--(a)  The board shall fix,

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by official order, the minimum prices or a formula for the

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setting of minimum prices to be paid by milk dealers or handlers

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to producers for milk or milk components sold or delivered or

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made available on consignment or otherwise by producers to

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dealers or handlers: Provided, however, That the fixing of

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prices to be paid by milk dealers or handlers to producers for

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milk or milk components to be used solely in manufacturing shall

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be discretionary with the board.

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(b)  Prices to producers fixed by the board under this

22

section in excess of the Federal order price shall be paid by

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milk dealers or handlers into the Producer Settlement Fund.

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Section 3.  The act is amended by adding a section to read:

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Section 803.1.  Title to milk.--(a)  The scope of this

26

section is as follows:

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(1)  This section shall apply only to the administration of

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this act.

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(2)  This section shall not supersede an order of a Federal

30

administrative agency or of the board which requires the cost of

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1

shipment of milk to be free on board the place of destination.

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(b)  Notwithstanding 13 Pa.C.S. § 2401(2)(ii) (relating to

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passing of title; reservation for security; limited application

4

of section), title to milk shall be transferred from the

5

producer to the milk dealer at the point of shipment of the

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milk.

7

Section 4.  Section 805 of the act, amended July 31, 1968

8

(P.L.963, No.294), is amended to read:

9

Section 805.  Price Increases.--It is hereby declared to be

10

the legislative intent that the benefits of any increase of

11

prices received by milk dealers, by virtue of the minimum price

12

provisions of this article, shall be given to producers[, except

13

in any case where the board deems a deviation from this policy

14

necessary in order lawfully to maintain proper milk markets and

15

outlets for producers and consumers]. The board shall, whenever

16

it deems such action necessary, issue orders, rules or

17

regulations to effectuate this intent.

18

Section 5.  Sections 1102 and 1104 of the act, amended

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December 20, 1991 (P.L.404, No.48), are amended to read:

20

Section 1102.  Expenses.--(a)  As much of the money in the

21

Milk Marketing Fund as may be necessary shall be annually

22

appropriated to the Milk [Marketing] Control Board to be used to

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pay its expenses, including the following:

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(1)  Salaries of the board and of its employes.

25

(2)  Rental and other expenses for offices, rooms, garage

26

space and other accommodations outside of the Capitol Buildings,

27

either in or outside of the capital city, occupied by the board.

28

(3)  Premiums for workmen's compensation insurance covering

29

the officers and employes of the board.

30

(4)  Premiums for surety bonds for such officers or employes

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1

of the board as may be required by law to furnish such bonds.

2

(5)  Purchase and operating costs of motor vehicles required

3

by the board for full-time use, including premiums for liability

4

insurance covering such motor vehicles and the members of the

5

board and employes operating them; also the amount payable to

6

the Department of General Services for the use of automobiles

7

supplied by it for temporary use by the board.

8

(6)  Furniture, stationery, materials, supplies and all other

9

overhead expenses of the board.

10

(7)  All other expenses of every kind and description

11

necessary for the performance by the board of its work.

12

(b)  All such purchases and leases shall be made, and all

13

such contracts of insurance and surety bonds shall be placed,

14

through the Department of General Services as agent.

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(c)  Before November 1 of each year, the [Milk Marketing

16

Board] board shall estimate its total expenses for the fiscal

17

year beginning July 1 of the following year. This estimate shall

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be submitted to the Governor in accordance with section 610 of

19

the act of April 9, 1929 (P.L.177, No.175), known as "The

20

Administrative Code of 1929." At the same time the board submits

21

its estimate to the Governor, the board shall also submit that

22

estimate to the General Assembly through the President pro

23

tempore of the Senate and the Speaker of the House of

24

Representatives. The board, or its designated representatives,

25

shall be afforded an opportunity to appear before the Governor

26

regarding its estimate.

27

Section 1104. Payment.--Moneys in the Milk Marketing Fund

28

appropriated to the Milk [Marketing] Control Board shall be paid

29

out upon warrant of the State Treasurer drawn after requisition

30

by the secretary of the Milk [Marketing] Control Board.

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1

Section 6.  The act is amended by adding a section to read:

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Section 1104.1.  Producer Settlement Fund.--The Producer

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Settlement Fund is hereby established in the State Treasury as a

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restricted account. The fund shall consist of moneys deposited

5

in accordance with section 803(b). All moneys in the fund and

6

the interest accruing thereon are hereby appropriated to the

7

Milk Control Board on a continuing basis to carry out the

8

provisions of this section. The board may use up to two percent

9

(2%) of the fund for administration. Moneys in the fund shall be

10

distributed by the board on a pro rata basis to qualified

11

producers based on the volume of milk produced and shipped by

12

each qualified producer.

13

Section 7.  Section 1204 of the act, added December 21, 1984

14

(P.L.1278, No.243), is repealed:

15

[Section 1204.  Joint Study Committee.--There is hereby

16

created a Joint Study Committee which shall study the

17

implementation and effect of resale pricing under this act. The

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committee shall be in existence until its report hereunder is

19

delivered to the General Assembly not later than December 31,

20

1985. The committee shall consist of the following members:

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(1)  Four producers, one each appointed by the majority

22

leader and minority leader of each house.

23

(2)  Four consumers, one each appointed by the majority and

24

minority leaders of each house.

25

(3)  Four dealers, one each appointed by the majority and

26

minority leaders of each house.

27

(4)  The chairman and the minority chairman of the

28

Agriculture and Rural Affairs Committees of each house, or their

29

designee.

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(5)  One at-large member appointed by the Secretary of

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Agriculture.

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At the first meeting of the committee which will be called by

3

the chairman of the Senate Agriculture and Rural Affairs

4

Committee, the committee shall elect a chairman who, with the

5

concurrence of a majority of the members of the committee, shall

6

determine a schedule of meetings for the conduct of committee

7

business. The chairman thus elected, or another member of the

8

committee as appointed by the chairman, shall preside at all

9

meetings of the committee.

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There is also hereby created an advisory committee to provide

11

assistance and support for the Joint Study Committee and which

12

shall consist of:

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(1)  The chairman of the Pennsylvania Milk Marketing Board

14

and his staff.

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(2)  The Dean of the Pennsylvania State University College of

16

Agriculture and his staff.

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(3)  The Dean of the Wharton School of Business

18

Administration of the University of Pennsylvania and his staff.

19

The purpose of the committee shall be to study and report

20

upon the implementation and effect of the resale milk pricing

21

provisions of this act. The committee shall submit its final

22

report to the Agriculture and Rural Affairs Committee of each

23

house not later than December 1, 1985.]

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Section 8.  This act shall take effect in 60 days.

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