BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | AB 224| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: AB 224 Author: Gordon (D) Amended: 9/3/13 in Senate Vote: 21 SENATE AGRICULTURE COMMITTEE : 4-0, 7/2/13 AYES: Galgiani, Cannella, Berryhill, Wolk NO VOTE RECORDED: Lieu SENATE APPROPRIATIONS COMMITTEE : 5-0, 8/12/13 AYES: De León, Gaines, Hill, Lara, Steinberg NO VOTE RECORDED: Walters, Padilla ASSEMBLY FLOOR : 76-0, 5/29/13 - See last page for vote SUBJECT : Agricultural products: direct marketing: community-supported agriculture SOURCE : Community Alliance with Family Farmers DIGEST : This bill defines community-supported agriculture (CSA) within the direct marketing program regulated by the Department of Food and Agriculture (DFA). This bill establishes regulatory parameters and requires CSA registration fees to fund administration and related programmatic costs, as specified. Requires the secretary of DFA to file an order to adopt, amend, or repeal regulations relating to the fee, as specified. Senate Floor Amendments of 9/3/13 clarify fees related to amended registrations, require a single-farm CSA program to CONTINUED AB 224 Page 2 source all products from only one farm with no more than a de minimus amount originating from other registered CSAs, and prohibit the adoption, amendment, or repeal of fees pursuant to CSAs from being subject to certain rulemaking provisions. ANALYSIS : Existing law establishes the federal Farmer-to-Consumer Direct Marketing Act of 1976 which 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." Shortly following, the DFA 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, Chapter 447, Statutes of 2008) to include farm stands, field retail stands, and other forms of direct marketing. Existing law makes legislative findings and declarations regarding 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 DFA 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. This bill: 1. Encourages DFA to assist in organizing CSA by including CSAs as a form of direct marketing under the Food and Agriculture Code. 2. 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). CONTINUED AB 224 Page 3 3. Defines "single-farm" CSA programs to mean a program where all farm products originate from and are produced at the farm of a single registered California direct marketing producer, with no more than a de minimus amount of products originating from other registered California direct marketers. 4. 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. 5. Requires that a registered California direct marketing producer or group comply with the following: A. Register annually with DFA 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. B. Label the farm delivery box with the name and address of the farm. C. Maintain the consumer boxes in a condition that prevents contamination. D. Inform consumers of the origin of each item included in the box. E. Maintain records that document the contents and origin of all items included in each consumer box. F. Comply with all labeling and identification requirements for shell eggs and processed foods. 1. 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. 2. Adds any whole uncut fruit, vegetable or unrefrigerated shell egg grown or produced in compliance with all applicable CONTINUED AB 224 Page 4 federal, state or local laws, regulations and food safety guidelines issued by a regulatory agency, as an "approved source" of food. 3. 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. 4. Requires poultry, rabbit, and other meat to comply with handling requirements established in the small farm food safety guidelines published by DFA per provisions in this bill. 5. Authorizes the Department of Public Health (DPH) 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. 6. Authorizes the secretary of DFA to set and collect a fee for, or the fee for amendment to the annual registration, not to exceed $100, from a registered California direct marketing producer. Requires these funds to be used by DFA for administration of this program, which includes the following: A. Creation and maintenance of a registration system. B. Development and publication of periodic small farm food safety guidelines in consultation with the DPH 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. C. Expenses incurred relative to meetings of any ad hoc direct marketing advisory committee established by the secretary. 1. 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. Requires these provisions to be followed regardless of any fee waiver. CONTINUED AB 224 Page 5 2. Prohibits the adoption, amendment, or repeal of any fee, as defined, from being subject to specified requirements of the Government Code. 3. Requires an order to adopt, amend, or repeal regulations concerning the fee, as defined, to be transmitted within 30 days by the secretary to the Office of Administrative Law. 4. Requires the Office of Administrative Law to file the order promptly with the Secretary of State without further review, as defined, and to contain all of the following: A. Indicate that the regulations are adopted, amended, or repealed pursuant to this chapter. B. State that the order is being transmitted for filing. C. Request that the Office of Administrative Law publish a notice of the filing of the order and print an appropriate reference in Title 3 of the California Code of Regulations. Background 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 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, Davis, 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 . DFA 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 CONTINUED AB 224 Page 6 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. Prior Legislation AB 1632 (Gordon, 2012) would have encouraged DFA to assist in organizing the marketing of community-assisted agriculture. The bill was referred to the Assembly Agriculture Committee and not taken up for hearing. 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 DFA 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. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: Yes According to the Senate Appropriations Committee, DFA indicates that it would need 0.5 positions and $25,000 (special funds) to implement the provisions of this bill. DFA identifies about 350 CSAs in the state. The $100 fee will generate $35,000 in annual revenue. Thus, revenues generated by this bill will be sufficient to fund the additional costs identified above. SUPPORT : (Verified 9/4/13) Community Alliance with Family Farmers (source) California Association of Environmental Health Administrators California Farm Bureau Federation California Federation of Certified Farmers' Markets ARGUMENTS IN SUPPORT : According to the author, the "rapid expansion of CSAs in recent years along with adaptations to the CONTINUED AB 224 Page 7 original CSA model demonstrates that CSAs are in need of definition and parameters for its regulation." 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 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." 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. 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." ASSEMBLY FLOOR : 76-0, 5/29/13 AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Bigelow, Bloom, Blumenfield, Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian Calderon, Campos, Chau, Chávez, Chesbro, Conway, Cooley, Dahle, Daly, Dickinson, Donnelly, Eggman, Fong, Fox, Frazier, Beth Gaines, Garcia, Gatto, Gomez, Gonzalez, Gordon, Gorell, Gray, Grove, Hagman, Hall, Harkey, Roger Hernández, Jones, Jones-Sawyer, Levine, Logue, Lowenthal, Maienschein, Mansoor, Medina, Melendez, Mitchell, Morrell, Mullin, Muratsuchi, Nazarian, Nestande, Olsen, Pan, Patterson, Perea, V. Manuel Pérez, Quirk, Quirk-Silva, Rendon, Salas, Skinner, Stone, Ting, Wagner, Waldron, Weber, Wieckowski, Wilk, Williams, John A. Pérez NO VOTE RECORDED: Holden, Linder, Yamada, Vacancy JL:k 9/5/13 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED