BILL ANALYSIS Ó SENATE COMMITTEE on AGRICULTURE Senator Cathleen Galgiani, Chair BILL NO: SB 1399 HEARING: 04/01/14 AUTHOR: Galgiani FISCAL: Yes VERSION: 03/26/14 CONSULTANT: Anne Megaro Agricultural seed: county seed enforcement subventions. SUMMARY : This bill would extend the operation and repeal dates for provisions of the California Seed Law, including an annual county subvention for enforcement activities necessary to carry out these provisions, until July 1, 2019 and January 1, 2020, respectively. This bill would give greater discretion to the secretary of the California Department of Food and Agriculture, in consultation with the Seed Board, to determine the formula used to reimburse commissioners for their work enforcing the seed law and would allow for multi-year memorandums of understanding between commissioners and CDFA. BACKGROUND AND EXISTING LAW : The California Seed Law (CSL) was enacted in 1967 to ensure that agricultural and vegetable seed is properly and accurately identified on the product label. Seed is analyzed through the Seed Services program administered by CDFA. The CSL is locally enforced by county agricultural commissioners who enter into cooperative agreements with the secretary of CDFA and agree to maintain a statewide compliance level on all seed sold in the county. In return, county agricultural commissioners receive annual subvention payments for expenses incurred in association with approved enforcement work plans (Food and Agriculture Code (FAC) §52251, et seq.). Funding for this program is entirely supported through industry seed assessments and registration fees and is administered by CDFA. Every labeler of agricultural or vegetable seed offered for sale in California, or any person who sells that seed in this state, must annually register as a seed labeler and pay an annual fee of $40. In addition, those who are registered seed labelers must also pay an assessment capped at 40 cents per $100 gross annual dollar volume sales. The secretary shall determine the rate of assessment, not to exceed the department's cost of carrying out these provisions (FAC §52321; 52351-6). CDFA allocates $120,000 for subvention payments among all SB 1399 - Page 2 counties for costs incurred by enforcement of the CSL. At the discretion of the secretary and upon recommendation of the Seed Advisory Board, counties with no registered seed labelers may annually receive $100. Agricultural commissioners in counties with registered seed labelers shall receive subventions based upon the volume of work performed (FAC §52323-5). PROPOSED LAW : This bill: 1. Extends from July 1, 2016 to July 1, 2019 the inoperative date, and from January 1, 2017 to January 1, 2020 the repeal date, of an optional county subvention program for enforcement activities of provisions of the California Seed Law. 2. Repeals the formula used to calculate the reimbursement of subvention funds to county agricultural commissioners for work performed enforcing the California Seed Law. 3. Authorizes the secretary of CDFA, in consultation with the Seed Advisory Board, to determine the subvention fund distribution formula. 4. Allows for multi-year memorandums of understanding between commissioners and CDFA. COMMENTS : Purpose of Bill: According to the author, this bill is necessary for the continued allocation of industry-derived subvention funds to counties for the enforcement of the California Seed Law. These payments provide county agricultural commissioners the ability to perform local seed inspection and enforcement services to ensure that seed sold in California is properly and accurately identified on the product label. Without this subvention, it is unlikely that the CSL would be enforced in a cost-effective manner. Commissioner Subvention: There is a question as to whether the formula used to pay subvention funds to county agricultural commissioners should be updated to more accurately distribute the $120,000 among counties. This bill would address this issue and allow the secretary of CDFA, in consultation with the Seed SB 1399 - Page 3 Advisory Board, greater flexibility and discretion in determining the subvention distribution formula. MOU: Currently, annual memorandums of understanding (MOU) are required between commissioners and CDFA to determine work to be performed. Extending to multi-year MOUs will reduce administrative costs and reduce paperwork burden on commissioners. Additional Concerns: In addition to updating the distribution formula, there is a question as to whether the total monies available for subvention should be increased. These discussions are ongoing and will be addressed at future Seed Advisory Board meetings. RELATED LEGISLATION : SB 348 (Galgiani), Chapter 385, Statutes of 2013. Extends to January 1, 2017, the operation of provisions of the California Seed Law, including a subvention program. AB 1255 (T. Berryhill), Chapter 281, Statutes of 2009. Extends to January 1, 2015, the operation of provisions of the California Seed Law, including a subvention program. AB 856 (Galgiani), Chapter 425, Statutes of 2008. Extends to January 1, 2010, the operation of provisions of the California Seed Law, including a subvention program. Provides that the minimum $100 subvention may not be allocated to counties without registered seed labelers. AB 315 (Salinas), Chapter 394, Statutes of 2003. Requires the secretary to pay a total annual subvention to counties of $120,000. Extends to July 1, 2009, the operation of provisions in the California Seed Law. SUPPORT : California Seed Association (Sponsor) California Agricultural Commissioners and Sealers Association Rural County Representatives of California OPPOSITION : None received SB 1399 - Page 4