BILL ANALYSIS                                                                                                                                                                                                    Ó



                           SENATE COMMITTEE on AGRICULTURE
                          Senator Cathleen Galgiani, Chair

          BILL NO:    AB 224                    HEARING:  07/02/13
          AUTHOR:   Gordon                      FISCAL:  Yes
          VERSION:  06/26/13                    CONSULTANT:  Anne Megaro
          
            Agricultural products: direct marketing: community-supported  
                                    agriculture.

           SUMMARY  :
          This bill would define community-supported agriculture (CSA)  
          within the direct marketing program regulated by the California  
          Department of Food and Agriculture.  This bill would establish  
          regulatory parameters and require CSA registration fees to fund  
          administration and related programmatic costs, as specified.
          

           BACKGROUND AND EXISTING LAW  :
          The federal  Farmer-to-Consumer Direct Marketing Act of 1976  was  
          enacted to promote "the development and expansion of direct  
          marketing of agricultural commodities from farmers to consumers"  
          in order to "lower the cost and increase the quality of food to  
          such consumers while providing increased financial returns to  
          the farmers" (7 USC Sec. 3001).  Shortly following, the  
          California Department of Food and Agriculture (CDFA) enacted  
          regulations exempting certified farmers' markets from certain  
          packing, sizing, and labeling requirements under the Fruit, Nut,  
          and Vegetable Standards Law in order to sell agricultural  
          products directly to consumers.  These exceptions were expanded  
          by AB 2168 (Jones) in 2008 to include farm stands, field retail  
          stands, and other forms of direct marketing. (Food and  
          Agricultural Code § 47000 et seq.).

          Existing law makes legislative findings and declarations in  
          regards to the direct marketing of agricultural products as  
          being a benefit to the agriculture community and consumers by  
          supplying quality produce at reasonable prices.  Existing law  
          encourages CDFA to assist producers in organizing direct  
          marketing activities by providing technical advice on marketing  
          methods and in complying with the regulations that affect direct  
          marketing programs (Food and Agriculture Code § 47000).

           Community-supported agriculture (CSA):   As defined by the United  
          States Department of Agriculture's National Agricultural  
          Library, "Community Supported Agriculture consists of a  
          community of individuals who pledge support to a farm operation  
          1Galt, R.E., L. O'Sullivan, J. Beckett, and C. C. Hiner. Jan-Mar  
          2012. Community Supported Agriculture is thriving in the Central  
          Valley. California Agriculture. 66(1):8-14. 



          AB 224 - Page 2


          so that the farmland becomes, either legally or spiritually, the  
          community's farm, with the growers and consumers providing  
          mutual support and sharing the risks and benefits of food  
          production."

          According to a study conducted at the University of California,  
          Davis1, CSAs have gained popularity in the last few decades,  
          first forming in the mid-1980s and growing to over 3,600 CSA  
          operations today.  However, existing law does not specifically  
          define CSAs within direct marketing programs or provide for a  
          cohesive programmatic model or regulatory oversight.
           Ad Hoc Committee:   CDFA convened the Direct Marketing Ad Hoc  
          Committee to assess the role of direct marketing in California  
          and create a transparent and inclusive process to reinvigorate  
          the Direct Marketing Program.  The Ad Hoc Committee published a  
          report in December 2012 with their findings, which confronted  
          the long-term health of direct marketing, funding and  
          enforcement, and potential regulatory frameworks and program  
          designs.  The CSA Subcommittee of the Ad Hoc Committee agreed  
          that some additional regulatory oversight may be necessary to  
          ensure integrity of commodity marketing, food safety, and a  
          level business playing field.


           PROPOSED LAW  :  

           This bill:  

                 Encourages CDFA to assist in organizing  
               community-supported agriculture by including CSAs as a form  
               of direct marketing under Division 17 of the Food and  
               Agriculture Code.

                 Defines "community-supported agriculture program," or  
               CSA program, to mean a program under which a registered  
               California direct marketing producer, or a group of  
               registered California direct marketing producers, grow food  
               for consumer shareholders or subscribers who pledge to  
               contract to buy a portion of the future crop, animal  
               production, or both, of the registered California direct  
               marketing producer(s).

                 Defines "single-farm" CSA programs to mean a program  
               where farm products originate from and are produced at the  
               farm of a single registered California direct marketing  
               producer, with no more than 10% of products originating  
               from other registered California direct marketers.





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                 Defines "multi-farm" CSA programs to mean a program  
               where all farm products originate from and are produced at  
               one or more farms of a group of registered California  
               direct marketing producers who declare their association as  
               a group by certification.

                 Requires that a registered California direct marketing  
               producer or group comply with the following:

                  o         Register annually with CDFA as either a  
                    single- or multi-farm CSA and declare that produce  
                    will be grown in accordance with good agricultural  
                    practices, as outlined in the small farm food safety  
                    guidelines published by the department.
                  o         Label the farm delivery box with the name and  
                    address of the farm.
                  o         Maintain the consumer boxes in a condition  
                    that prevents contamination.
                  o         Inform consumers of the origin of each item  
                    included in the box.
                  o         Maintain records that document the contents  
                    and origin of all items included in each consumer box.
                  o         Comply with all labeling and identification  
                    requirements for shell eggs and processed foods.

                 Adds registered California direct marketing producers in  
               good standing and in compliance with these provisions as an  
               "approved source" of food that conforms with applicable  
               laws, current public health principles and practices, and  
               generally recognized industry standards that protect public  
               health.  

                 Adds any whole uncut fruit, vegetable or unrefrigerated  
               shell egg grown or produced in compliance with all  
               applicable federal, state or local laws, regulations and  
               food safety guidelines issued by a regulatory agency, as an  
               "approved source" of food.

                 Requires all potentially hazardous food contained within  
               a consumer box to be produced, processed and handled  
               according to all applicable federal, state and local food  
               safety requirements.

                 Requires poultry, rabbit, and other meat to comply with  
               handling requirements established in the small farm food  
               safety guidelines published by CDFA per provisions in this  





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               bill. 

                 Authorizes the California Department of Public Health or  
               a local regulatory agency responsible for retail food  
               safety to enter and inspect a CSA operation in response to  
               a public food safety complaint.  The CSA shall cover  
               reasonable costs associated with such an inspection.

                 Authorizes the secretary of CDFA to set and collect an  
               annual registration fee, not to exceed $100, from a  
               registered California direct marketing producer.  These  
               funds shall be used by the department for administration of  
               this program, which includes the following:

                  o         Creation and maintenance of a registration  
                    system.
                  o         Development and publication of periodic small  
                    farm food safety guidelines in consultation with the  
                    Department of Public Health and local health officers.  
                     The guidelines shall include, but not be limited to,  
                    safe production, processing, and handling of both  
                    non-potentially hazardous and potentially hazardous  
                    foods. 
                  o         Expenses incurred relative to meetings of any  
                    ad hoc direct marketing advisory committee established  
                    by the secretary.

                 Waives part or all of the annual registration fee if the  
               California direct marketing producer pays fees for  
               registration or certification under any other program under  
               the purview of this chapter.  Provisions of this chapter  
               shall be followed regardless of any fee waiver.


           COMMENTS  :

           Stated need for this bill:   According to the author, the "rapid  
          expansion of CSAs in recent years along with adaptations to the  
          original CSA model demonstrates that CSAs are in need of  
          definition and parameters for its regulation.  With the numerous  
          economic, social, and environmental benefits of Community  
          Supported Agriculture and its growing popularity, it makes sense  
          to explore the creation of policy instruments to support the  
          needs of CSA farmers and consumers."  Furthermore, according to  
          those in support, "It became clear in that task force (CDFA  
          Direct Marketing Ad Hoc Committee) that CSAs were not an  
          "approved source" for health and safety purposes at present, and  





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          that either they needed to obtain retail food permits from  
          Environmental Health or they needed to be clearly included in  
          the direct marketing laws and some food safety practices  
          mandated that would satisfy the health authorities."

           Ad Hoc Committee:  According to the Direct Marketing Ad Hoc  
          Committee report, "In practice, there is significant variation  
          within the State of California in regard to definition of a CSA.  
          These models substantially deviate from USDA's definition.  For  
          example, there are entities which purchase agricultural products  
          at CFMs (certified farmers' markets), farm stands, field retail  
          stands, the point of production, and wholesale markets and  
          subsequently sell a "subscription" to the public. Other CSAs  
          produce some of their own agricultural products and supplement  
          with products from other producers or entities.  As a result of  
          the ambiguity related to the definition of a CSA, industry and  
          consumers would benefit from a clear definition of CSAs that  
          encompasses California's burgeoning CSA industry."

           Program cost:   The $100 registration fee has been determined by  
          the Assembly Appropriations Committee to be adequate to cover  
          the costs of administering this program.


           RELATED LEGISLATION  :

          AB 996 (Dickinson) of 2013.  Amends certified farmers' market  
          law, requirements, fees, and related provisions and adds  
          community-supported agriculture to the definition of direct  
          marketing.  Held under submission in the Assembly Appropriations  
          Committee.

          AB 1632 (Gordon) of 2012.  Would have encouraged CDFA to assist  
          in organizing the marketing of community-assisted agriculture.

          AB 2168 (Jones), Chapter 447, Statutes of 2008.  Expands the  
          definition of direct marketing to include farm stands, field  
          retail stands, and other forms of direct marketing, revises  
          related definitions, and authorizes CDFA to adopt regulations to  
          regulate direct marketing, as specified.

          AB 593 (Strom-Martin), Chapter 833, Statutes of 1999.  Codifies  
          regulations exempting direct marketers from specified packing  
          and labeling standards, amends fee structures, and authorizes  
          farmers' markets to establish rules and procedures.







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           PRIOR ACTIONS  :
          
          Assembly Floor      76-0
          Assembly Appropriations  17-0
          Assembly Agriculture       7-0

           SUPPORT  :

          Community Alliance with Family Farmers (Sponsor)
          California Association of Environmental Health Administrators
          California Farm Bureau Federation
          California Federation of Certified Farmers' Markets


           OPPOSITION  :

          None received