BILL ANALYSIS Ó AB 1132 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 1132 (Eggman) As Amended August 12, 2013 2/3 vote ----------------------------------------------------------------- |ASSEMBLY: |77-0 |(May 29, 2013) |SENATE: |36-0 |(September 3, | | | | | | |2013) | ----------------------------------------------------------------- Original Committee Reference: AGRI. SUMMARY : Increases both the restricted livestock drug license application fee and late payment fee to $50; authorizes the Secretary of the California Department of Food and Agriculture (CDFA) to establish a hazard analysis and preventive control measures for all commercial feed; and, extends the sunset date for commercial feed license fees, inspection tonnage tax, and provisions regarding the inspection tonnage tax to January 1, 2020. The Senate amendments expand the provisions of the bill as passed by the Assembly, by adding the following: 1)Increase the restricted livestock drug license and late payment fees from $25 to $50. 2)Authorize CDFA to establish a hazard analysis and preventive control measures for all commercial feed. FISCAL EFFECT : According to the Senate Appropriations Committee, the increase in restricted livestock drug license application fee is projected to increase revenues by about $10,000 (special funds), and would be sufficient to fund current workload; the commercial feed license fee is projected to generate $528,900 in revenue (special funds); without a sunset extension for the enhanced fee authority, the revenue would fall to approximately $176,300, a loss of $352,600; and, the commercial feed tonnage tax generates about $1.9 million (special funds) annually for the operation of the feed inspection program. The tonnage tax has a statutory maximum rate of $0.15 per ton while the current rate is $0.08 per ton. COMMENTS : The retail license application fee for the sale of restricted livestock drugs and the renewal fee has been $25 AB 1132 Page 2 since 1976, if not longer. The cost of handling these applications has increased and this increase should cover the costs of the program. The Feed Inspection Program (FIP) was created in 1972. Its purpose is to ensure a clean and wholesome supply of milk, meat and eggs by providing clean and wholesome fodder for livestock and poultry, as well as providing assurance that the product received by the consumer is of the quality and quantity purported by the manufacturer. The feed industry has requested to have CDFA establish a hazard analysis and preventive control measures for all commercial feed. This is the first time the sunset on the inspection tax has been considered "a tax", requiring a two-thirds vote for passage in both houses. In the past, previous to Proposition 26 of 2010, this legislation required a simple majority vote in both houses for passage. Analysis Prepared by : Jim Collin / AGRI. / (916) 319-2084 FN: 0001772