BILL ANALYSIS �
SB 250
Page 1
Date of Hearing: August 21, 2013
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
SB 250 (Wolk) - As Amended: August 5, 2013
Policy Committee: AgricultureVote:7
- 0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill establishes the Olive Oil Commission of California
(OOCC) 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
California Department of Food and Agriculture (CDFA).
2)Creates a board of directors composed of six producers, three
handlers and one public member appointed by the Secretary.
3)Requires that 40% of the total number of producers cast a
referendum vote to begin operation of the commission.
4)Establishes an assessment rate to be paid by producers of not
more than $0.25 per gallon 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.
5)Authorizes the commission to serve as the advisory body to the
Secretary on all matters pertaining to olive oil quality
standards.
FISCAL EFFECT
1)If the maximum assessment of $0.25 per gallon is leveled on
2.4 million gallons of olive oil, the commission would receive
$600,000 in operating revenue.
SB 250
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2)Start up costs for CDFA would be approximately $40,000 with
ongoing costs between $15,000 and $20,000 per year. All costs
would be reimbursed by the commission.
COMMENTS
1)Purpose . The intent of this legislation is to create the OOCC
in order to support the California olive oil industry and
combat what the author has found to be fraudulent practices in
the labeling of olive oil. California's olive oil industry has
been growing rapidly over the past five years. The author
asserts that 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
agricultural product.
2)California's Olive Oil Industry . Currently, California
accounts for 99% of national olive production, and has roughly
400 growers on approximately 30,000 acres dedicated to the
production of olive oil. With over 50 varieties of olives
grown in California, it is estimated that the 2013 harvest
will produce over 2.4 million gallons of oil.
According to supporters of the bill, 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 sensory testing that found that
69% 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.
3)Agricultural Commissions . 16 different commissions for various
commodities ranging from avocados to walnuts have been
established under Division 22 of the Food and Agriculture
Code. Typically, these state-established commissions and
councils are authorized by statute to engage in various
activities covering promotion, education, production or
post-harvest research, and quality standards and inspections,
with some variation in authorization between different
commissions.
SB 250
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In recent years, one commission was terminated by the industry
and another had an audit by the Secretary, which revealed
potential misuse of funds. This bill has language requiring
annual audits, and upon a determination of need, the Secretary
may conduct a fiscal and administrative audit of OOCC.
Analysis Prepared by : Julie Salley-Gray / APPR. / (916)
319-2081