BILL ANALYSIS �
SB 250
Page 1
Date of Hearing: June 25, 2013
ASSEMBLY COMMITTEE ON JUDICIARY
Bob Wieckowski, Chair
SB 250 (Wolk) - As Amended: June 3, 2013
SENATE VOTE : 35-2
SUBJECT : Olive oil commission of california
KEY ISSUE : should the state establish the olive oil commission
of california to engage in quality and nutritional research and
recommend grades and labeling standards In a rapidly expanding
industry?
FISCAL EFFECT : As currently in print this bill is keyed fiscal.
SYNOPSIS
This non-controversial bill seeks to establish the Olive Oil
Commission of California, with a prescribed membership and
specified powers, duties and responsibilities vested in a
commission board of directors, but only if the olive oil
industry votes in sufficient number to approve this
self-assessment process modeled after other similar agriculture
commissions in California. Among other things, the board of
directors would be authorized to conduct quality and nutritional
research and to recommend to the Secretary of the California
Department of Food and Agriculture olive oil grades and labeling
standards. In addition, the bill would authorize the commission
to levy an annual assessment on producers, as defined, not to
exceed the reasonable costs of implementing the chapter's
provisions, and would authorize the commission to expend those
funds for the purpose of implementing the bill. There is no
known opposition and the bill received strong bi-partisan
support in the Senate.
SUMMARY : Establishes the Olive Oil Commission of California to
engage in olive oil quality and nutritional research and to
recommend grades and labeling standards. Specifically, this
bill :
1)Creates the Olive Oil Commission of California to engage in
olive oil quality and nutritional research, and to recommend
grades and labeling standards to the Secretary of the
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California Department of Food and Agriculture (Secretary).
2)States declarations and general provisions.
3)Defines the terms "olive oil," "district boundaries,"
"handler," "marketing season," "producer," and "advisory
committee."
4)Creates a board of directors composed of six producers, three
handlers and one public member appointed by the Secretary from
nominees recommended by the board. Provides for alternate
members.
5)Authorizes the board to modify the number of producers and
handlers who serve on the board. Changes must be adopted by a
two-thirds vote in concurrence with the Secretary, and prior
notice must be given to all commission members.
6)Creates an advisory committee to advise the board on issues
affecting the commission. Provides for seven members serving
three-year terms and a chair selected by the members.
7)Provides that the Secretary and the chair of the advisory
committee be ex-officio members of the board, in addition to
other appropriate persons as determined by the board.
8)Authorizes the Secretary to require the commission to correct
or cease any activity or function that is determined not to be
in the public interest or is in violation of this chapter.
Upon commission refusal or failure to comply, the Secretary
may, upon written notice, suspend commission activities or
functions. Allows either party to seek judicial relief in
court.
9)Requires the commission to reimburse the California Department
of Food and Agriculture for all expenditures incurred in
carrying out this chapter.
10)Allows the commission to bring suit, be subject to suit, and
enter into contracts.
11)Authorizes the Secretary or his or her representative to be
notified and attend meetings of the board, except for
executive sessions called for the purpose of discussing
litigation against the department.
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12)Provides that no member of the board or any committee shall
receive a salary. Except for ex-officio members, members may
receive reasonable and necessary traveling expenses and meal
allowances for attendance at meetings or special assignment.
13)Requires that all monies received by any person from
assessments levied under this chapter be deposited in banks of
the board's choosing.
14)Relieves the state of any liability for actions of the
commission or its contracts. No member, employee or agent of
the commission shall be personally liable for contracts or
responsible individually for any error except for their own
acts of dishonesty or crime.
15)Authorizes the board to:
a) Adopt and amend bylaws, rules, regulations and orders;
b) Administer and enforce this chapter;
c) Appoint officers and employ persons to serve as
president, chief executive officer, legal counsel, or other
personnel;
d) Fix compensation for employees;
e) Appoint committees;
f) Establish offices and incur expenses, invest funds,
enter into contracts and agreements, and create liabilities
and borrow funds;
g) Record and keep accurate books and accounts subject to
an annual audit submitted to the Legislature and the
department;
h) Present facts and negotiate with state, federal and
foreign agencies;
i) Conduct and contract for research to study olive oil
quality and nutrition and to collect contributions and
funds for research purposes;
j) Collect information, such as crop statistics, and
distribute periodic communications to producers;
aa) Establish an assessment rate;
bb) Establish an annual budget which shall be concurred in
by the Secretary;
cc) Submit an annual statement of activities for concurrence
by the Secretary;
dd) Investigate and prosecute civil violations of this
chapter and file complaints with law enforcement agencies;
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ee) Engage in activities creating, amending and enforcing
olive oil quality standards.
16)Establishes implementation and voting procedures to be
administered by the Secretary and provides that the initial
referendum be funded by proponents of this chapter.
17)Requires that 40 percent of the total number of producers to
cast a referendum vote to begin operation of the commission
and that either of the following also occur:
a) Of those votes, 65 percent must vote in favor of the
commission. That same 65 percent must also represent
producers who, when total production volume is combined,
produce the majority of olive oil of all those
participating in the referendum; or
b) Of those votes, a majority of producers must vote in
favor of the commission, and those producers must represent
65 percent or more of the total quantity of olive oil
produced by those participating in the referendum vote.
18)Authorizes the Secretary to declare this chapter inoperative
upon a failed referendum vote. The Secretary must wait at
least one year before conducting another vote.
19)Establishes an assessment rate to be paid by producers of not
more than $0.25 per calling of olive oil. An increase in this
rate must be approved by a referendum vote, and a penalty
shall be paid on any past due assessment.
20)Requires every handler and producer to keep complete and
accurate records of all olive oil handled. Records must be
kept for two years and be available for inspection.
21)Provides that all proprietary information be confidential.
22)Authorizes the commission to levy civil penalties not
exceeding $1,000 for persons who furnish false documents to
avoid paying assessment fees and for persons who destroy,
alter, refuse or fail to furnish reports or records required
to be kept by this chapter.
23)Authorizes the board to establish procedures for individuals
aggrieved by its actions, including appeals and judicial
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review.
24)Authorizes the commission to commence civil actions and
utilize all remedies provided in law for collection of
assessment and civil penalties.
25)Provides for continuation, suspension, or termination of this
chapter through commission referendum.
26)Requires the Secretary to hold a public hearing once every
five years to determine whether this chapter should be
continued. Should a substantial question be raised, the
Secretary shall hold a referendum vote to determine if the
commission shall be continued.
27)Authorizes the board, upon two-thirds vote, to recommend to
the Secretary that the commission be suspended for failure to
effectuate its declared purposes. The Secretary shall then
hold a referendum.
28)Authorizes the commission to serve as the advisory body to
the Secretary on all matters pertaining to olive oil quality
standards.
EXISTING LAW authorizes various marketing and promotion
commissions to promote the production and marketing of
California agricultural commodities. Commissions have a variety
of powers covering the advertising, promotion, education,
production or post-harvest research, and quality standards and
inspections, and similar commissions already cover a variety of
other commodities.
COMMENTS : According to the author, "California's olive oil
industry has been growing exponentially over the past five
years. The industry believes it is time to support a
coordinated effort to provide for olive oil research and
standards to promote the sustainability and success of this
important agricultural product."
Fraudulent Practices : Supporters state that California produces
some of the highest quality extra-virgin olive oil in the world.
However, the California olive oil industry faces fierce global
competition from producers who reportedly do not adhere to the
same high quality standards as California producers. The UC
Davis Olive Center released a study based on laboratory and
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sensory testing that found that 69 percent of imported
extra-virgin olive oils bought off the shelves of California
supermarkets failed to meet international standards. The
nationally-reported study concluded that many of these products
were falsely labeled as extra-virgin grade.
Organizational benefits : According to the California Department
of Food and Agriculture, the purpose of marketing programs is to
provide agricultural producers and handlers an organizational
structure, operating under government sanction, which allows
them to solve production and marketing problems collectively
that they could not address individually. Current marketing
programs' activities include commodity promotion, research, and
maintenance of quality standards. Commissions provide a
structure for solving problems and also provide a vehicle for
collecting funds to support activities.
Effectiveness of commissions : Several existing commissions
reportedly have been successful in achieving goals of improving
product quality, expanding markets, funding research, and
establishing product grades and standards. The current bill is
focused on creating the Olive Oil Commission of California to
conduct research and establish product grades and standards and
does not specifically authorize the use of assessment fees for
advertising purposes. This bill includes language requiring
annual audits, and upon determination of need, the Secretary may
conduct a fiscal and administrative audit of the commission.
RELATED LEGISLATION : AB 2695 (Hern�ndez), Chapter 605, Stat.
2010. Created the California Nursery Producers Commission with
prescribed membership, powers, duties, and responsibilities of
the commission. Authorized the commission to engage in
outreach, education, promotion, marketing, and research relating
to nursery products.
AB 1912 (Evans), Chapter 585, Stat. 2010. Created by the
California Apiary Research Commission with prescribed
membership, powers, duties and responsibilities of the
commission. Authorized the commission to engage in research and
education programs relating to honeybees.
AB 606 (Ma), Chapter 366, Stat. 2009. Created the California
Blueberry Commission with prescribed membership, powers, duties
and responsibility of the commission. Authorized the commission
to engage in education, promotion, marketing, and research
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relating to blueberries.
REGISTERED SUPPORT / OPPOSITION :
Support
Anchordoguy and Company
Bari Olive Oil Company
Blossom Vineyards
California Harvesting
California League of Food Processors
California Olive Oil Council
California Olive Ranch
Corto Olive Company
Dickson Napa Ranch
ENZO Olive Oil Company/P-R Farms, Inc.
Kennedy Ranch
Lodi Farming, Inc.
Maben Family, LLC
McCorkle Landy Company
Tocha Dehe Wintun Nation
Opposition
None on file
Analysis Prepared by : Drew Liebert and Alex Nowinski / JUD. /
(916) 319-2334