BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | AB 654| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: AB 654 Author: Hall (D) Amended: 6/26/13 in Senate Vote: 21 PRIOR VOTES NOT RELEVANT 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 SUBJECT : Direct marketing: certified farmers markets SOURCE : Author DIGEST : This bill extends the sunset date to January 1, 2018 for the collection of certified farmers market operator fees and enforcement provisions of direct marketing. ANALYSIS : 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". Shortly following, the Department of Food and Agriculture (DFA) enacted regulations exempting CONTINUED AB 654 Page 2 certified farmers' markets (CFMs) from certain packing, sizing, and labeling requirements under the Fruit, Nut, and Vegetable Standards Law. These farmers must be certified and annually inspected by their local county agricultural commissioner to verify that all products are grown on the farmer's property. There are approximately 700 CFMs with 2,200 certified farmers directly marketing products to consumers. In order to provide market oversight, administration, and enforcement, a "stall fee" of not greater than $0.60 is collected from each certified producer per marketing day. This fee is administered by DFA, and enforcement is carried out by the department or county agricultural commissioners, who may levy civil penalties for violations of this chapter or any enacted regulation. The collection of the stall fee and the enforcement provisions of this chapter are due to sunset on January 1, 2014. This bill extends the repeal date for the collection of CFM operator fees, and the enforcement provisions of direct marketing, from January 1, 2014 until January 1, 2018. Comments : Ad Hoc Committee . DFA convened the Direct Marketing Ad Hoc Committee to assess the role of direct marketing in California and identify opportunities to improve regulatory control to prevent fraudulent selling activities at CFMs. 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. Establishing a consensus proved to be difficult for many issues considered by the Ad Hoc Committee. These remaining issues, and others, are currently being addressed in AB 996 (Dickinson). Related legislation SB 513 (Cannella, Chapter 337, Statutes of 2011) extends from January 1, 2012, to January 1, 2014, the collection of CFM fees and related penalty and enforcement provisions. AB 2676 (Agriculture, Chapter 440, Statutes of 2006) extends from January 1, 2007, to January 1, 2012, the collection of CFM CONTINUED AB 654 Page 3 fees and related penalty and enforcement provisions. AB 1726 (Agriculture, Chapter 444, Statutes of 2004) extended from January 1, 2005, to January 1, 2007, the collection of CFM fees and related penalty and enforcement provisions. Imposed a late penalty charge on operators who failed to pay the required fee. 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: No According to the Senate Appropriations Committee, by extending the current sunset, this bill will generate about $240,000 annually (special funds), paid to DFA. The funding supports approximately one position at DFA that provides coordination and oversight with county agricultural commissioners. County Agricultural Commissioners certify markets and producers pursuant to local ordinances. SUPPORT : (Verified 8/14/13) California Agricultural Commissioners and Sealers Association ARGUMENTS IN SUPPORT : According to the author, "This measure will allow CFMs to continue to provide consumers with fresh, nutritious, local products and allow farmers to earn fair prices by marketing directly to consumers. CFMs are an important tool to combat obesity and food deserts in California and to promote healthy lifestyles." JL:d 8/14/13 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED AB 654 Page 4 CONTINUED