Regular Session 2019-2020 House Bill 1590 P.N. 2213

SENATE AMENDED

PRIOR PRINTER'S NOS. 2049, 2104, 2183

PRINTER'S NO. 2213

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

1590

Session of

2019

INTRODUCED BY OWLETT, CAUSER, M. K. KELLER, PICKETT, GREGORY,

PASHINSKI, FEE, CALTAGIRONE, SAYLOR, DeLUCA, MILLARD,

ZIMMERMAN, HERSHEY AND KAUFFMAN, JUNE 7, 2019

SENATOR VOGEL, AGRICULTURE AND RURAL AFFAIRS, IN SENATE, AS

AMENDED, JUNE 24, 2019

AN ACT

Amending Title 64 (Public Authorities and Quasi-Public

Corporations) of the Pennsylvania Consolidated Statutes, in

Commonwealth Financing Authority, establishing the Dairy

Investment Program and Dairy Investment Program Account.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. Title 64 of the Pennsylvania Consolidated

Statutes is amended by adding a section to read:

§ 1552.1. Dairy Investment Program.

(a) Establishment.--There is established a program to be

known as the Dairy Investment Program. The program shall provide

financial assistance in the form of grants for projects located

within this Commonwealth that support the dairy industry.

(b) Eligible applicants.--The following entities may apply

for grants:

(1) A corporation, partnership, sole proprietorship,

limited liability company, cooperative or any other

commercial entity approved by the authority.

(2) A private not-for-profit entity undertaking

agriculture-related activities that support the dairy

industry.

(3) A public school, private school or charter school.

(4) An accredited university, college, seminary college,

community college or two-year college.

shall be eligible for grants:

(1) Research and development projects that involve any

of the following:

(i) Identifying new food or beverage products using

milk or milk components.

(ii) Identifying pharmaceutical or industrial uses

for milk or milk components.

(iii) Extending the shelf life of milk and dairy

products.

(iv) Developing production and processing methods

that reduce the risk of foodborne illnesses in Grade A or

Grade B milk and dairy products.

(v) Developing new technologies allowing producers,

processors and distributors to provide consumers with

transparent, verifiable information on milk and dairy

products.

(vi) Developing specialized equipment for use in

organic production, value-added processing or marketing

of milk and dairy products.

(vii) Researching, developing and distributing best

management practices to enhance the workforce skills in

milk and dairy production and processing.

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(viii) Developing specialized or innovative

packaging for milk and dairy products that enhances the

flavor or appearance of the products or reduces the risk

of foodborne illnesses.

(2) Transitioning to certified organic production

projects, processing projects and distribution projects that

involve any of the following:

(i) Defraying costs of a third-party certification

audit conducted by an auditor accredited by the United

States Department of Agriculture.

(ii) Defraying costs of technical assistance to

producers or processors developing or implementing

organic system plans for milk or feed grains.

(iii) Defraying costs associated with the design of

product labeling to feature the United States Department

of Agriculture certified organic seal.

(iv) Developing signage or other tools by which a

producer transitioning to organic production methods can

provide notice to other producers, municipal employees or

the public of the application of pesticides near property

boundaries.

(v) Defraying costs of specialized equipment for

organic processing.

(3) Value-added processing projects involving any of the

following:

(i) A third-party feasibility analysis of the

economic, market, technical, financial and management

capabilities of a proposed project or project site.

(ii) Additional costs relating to food safety

licensing or certification incurred as the result of a

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new or expanded value-added dairy facility.

(iii) Capital costs to construct a new value-added

dairy facility or expand an existing value-added dairy

facility.

(iv) Costs incurred as a result of a new value-added

dairy facility or expanded value-added dairy facility

relating to any of the following:

(A) Site selection and development, permitting

or zoning.

(B) Compliance with Federal or State laws or

regulations or municipal ordinances.

(4) Marketing projects that involve any of the

following:

(i) Domestic or international market research and

demonstration programs for milk and dairy products.

(ii) Defraying costs of technical assistance in

creating or expanding a cooperative or other shared

marketing arrangement, including mid-tier value chains.

(iii) Regional or local branding efforts serving

more than one producer or processor and complementing the

PA Preferred® program.

(iv) Paid media advertising that intentionally

segments the marketplace and identifies a target audience

to influence consumer buying habits and behavior in favor

of milk.

(v) Developing on-farm tourism opportunities as a

potential source of additional revenue for a producer.

(vi) Distribution of specialized packaging for milk

and dairy products that enhance the flavor or appearance

of the products or reduce the risk of foodborne

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illnesses.

(vii) Promotional campaigns, including the pairing

of milk and dairy products with other Pennsylvania-

produced foods and beverages.

(D) ADDITIONAL PROJECTS.--THE AUTHORITY MAY CONSIDER

ADDITIONAL TYPES OF PROJECTS FOR GRANTS, AS WELL AS OTHER GRANT

AWARD AMOUNTS FOR PROJECTS, THAT THE AUTHORITY, IN CONSULTATION

WITH THE DEPARTMENT OF AGRICULTURE, DETERMINES WILL EFFECTUATE

THE INTENT OF THE PROGRAM.

(d) (E) Applications for grants.--

(1) An applicant may submit an application to the

authority requesting a grant in an amount not to exceed the

amount under subsection (f) (G) for the type of project

eligible under subsection (c). The application shall be on a

form required by the board and shall include all of the

following information:

(i) The applicant's name and address.

(ii) The location of the project.

(iii) A description of the project.

(iv) An estimate of the costs associated with the

project and the goal to be achieved by carrying out the

proposed activities of the project.

(v) Any other information required by the authority.

(2) A $100 nonrefundable application fee made payable to

the authority shall accompany each application.

(e) (F) Review and approval of applications.--

(1) The authority shall, in consultation with the

Department of Agriculture, review an application and evaluate

the application based on the following criteria:

(i) Whether the project incorporates at least 75%

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Pennsylvania-sourced milk.

(ii) The extent to which matching funds are used or

leveraged.

(iii) Whether the project can be replicated for use

across this Commonwealth.

(iv) Whether the project includes a strategic plan

for implementation.

(v) The inclusion of an itemized budget of all

costs.

(2) The authority may develop additional evaluation

criteria for each type of eligible project under subsection

(c).

(3) Grants shall be awarded to the extent funds are

available.

(f) (G) Grant awards.--Grant awards shall be as follows:

(1) For grants under subsection (c)(1), an amount not to

exceed $100,000.

(2) For grants under subsection (c)(2), an amount not to

exceed $50,000.

(3) For grants under subsection (c)(3), an amount not to

exceed:

(i) Fifty thousand dollars for an on-farm or single

producer project.

(ii) Five hundred thousand dollars for a

cooperative , processing plant or multi-producer project.

(4) For grants under subsection (c)(4), an amount not to

exceed $100,000.

(g) (H) Requirements.--

(1) The requirements for the administration of the

program shall be as follows:

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(i) A project shall require a 15% cash match of the

total project cost.

(ii) An application for a grant under this section

must be received by A DEADLINE TO BE ESTABLISHED BY the

authority no less than 60 days before a board meeting

where the application is considered .

(iii) The authority shall execute a grant agreement

between the board and a successful applicant before the

payment of a grant award.

(iv) A successful applicant shall maintain full and

accurate records for the project.

(v) A successful applicant shall submit to the

authority copies of all canceled checks or other records

verifying expenditures of grant proceeds.

(vi) A successful applicant shall submit to the

authority a final report of the project, including any

information as required by the board.

(2) The authority may establish additional requirements

for the program as the authority deems necessary to

administer the program.

(h) (I) Restrictions and limitations.--

(1) Administration costs for a project shall not exceed

2% of a total grant award.

(2) An applicant may not commence work on a project

before receiving authority approval of the project grant.

Commencement of work prior to receiving authority approval

will result in a project application being ineligible for

funding consideration.

(3) A successful applicant may not make a substantial

change to an approved project without first obtaining

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authority consent in writing.

(4) Any unused portion of a grant award shall be

returned to the authority.

(5) Grant awards may only be used for new projects

approved by the board.

(6) Grant awards may not be used for any of the

following:

(i) Paying fees for securing financing.

(ii) Paying interest on borrowed funds.

(iii) Refinancing existing debt.

(iv) Paying for lobbying services.

(v) Paying fines.

(vi) Application preparation fees.

(7) The authority may establish additional restrictions

and limitations as the authority deems necessary to

administer the program.

(i) (J) Account.--The authority shall establish the Dairy

Investment Program Account . ANY FUNDS APPROPRIATED TO THE DAIRY

INVESTMENT PROGRAM SHALL BE DEPOSITED INTO THE DAIRY INVESTMENT

PROGRAM ACCOUNT for use in awarding grants under this section.

(j) (K) Transfers.--Funds in the First Industries Program

Account shall MAY be transferred to the Dairy Investment Program

Account as determined by the General Assembly. The General

Assembly may appropriate funds to the Dairy Investment Program

Account.

(k) (L) Definitions.--As used in this section, the

following words and phrases shall have the meanings given to

them in this subsection unless the context clearly indicates

otherwise:

"Cooperative." A for-profit or not-for-profit corporation

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formed under 15 Pa.C.S. Pt. II Subpt. D (relating to cooperative

corporations) that is owned and governed by individuals who use

the corporation's goods and services and share any profits of

the corporation.

"Dairy product." A food or nonfood product made from milk

and other ingredients.

"Mid-tier value chain." Local and regional supply networks

that link independent producers with businesses, cooperatives or

consumers that market a value-added dairy product in a manner

that enhances the profitability of dairy farms.

"Milk." A fluid secreted by the mammary glands of cows,

sheep and goats for human consumption and use and classified as

Grade A or Grade B with a current permit from the Department of

Agriculture of the Commonwealth.

"Organic." A farm or processing operation that in whole or

in part has been certified as organic or in transition to

organic by a third party accredited by the United States

Department of Agriculture. The term includes the production and

processing of milk and dairy products and the production of

certified organic feed grains for certified organic dairy

animals.

"Processor." An entity that pasteurizes or bottles milk for

sale or transforms milk into a value-added dairy product.

"Producer." A person, group or other entity that:

(1) owns or operates a farm in this Commonwealth that is

not less than 10 contiguous acres where the production of

milk occurs; and

(2) has an anticipated yearly gross income of at least

$10,000 .

"Value-added dairy." The process of transforming milk into a

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product of higher economic value in the marketplace for a food

use or nonfood use.

Section 2. This act shall take effect in 30 days

IMMEDIATELY.

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