BILL ANALYSIS Ó AB 264 Page 1 ASSEMBLY THIRD READING AB 264 (Dahle) As Amended April 21, 2015 Majority vote -------------------------------------------------------------------- |Committee |Votes |Ayes |Noes | |----------------+------+---------------------+----------------------| |Agriculture |10-0 |Perea, Gallagher, | | | | |Cooper, Dahle, Dodd, | | | | |Eggman, Grove, | | | | |Irwin, Quirk, Salas | | | | | | | |----------------+------+---------------------+----------------------| |Appropriations |17-0 |Gomez, Bigelow, | | | | |Bloom, Bonta, | | | | |Calderon, Chang, | | | | |Daly, Eggman, | | | | |Gallagher, Eduardo | | | | |Garcia, Holden, | | | | |Jones, Quirk, | | | | |Rendon, Wagner, | | | | |Weber, Wood | | | | | | | | | | | | -------------------------------------------------------------------- SUMMARY: This bill removes flower, agricultural, or vegetable seeds not purchased from a producer from the list of farm products that are regulated by the California Department of Food and AB 264 Page 2 Agriculture's (CDFA) Market Enforcement Branch (MEB). EXISTING LAW:. 1)Requires that any person engaged in the business of buying or reselling, as specified, farm products from a licensee or producer for resale, to be licensed by MEB. 2)Defines farm products to include every agricultural, horticultural, viticultural, and vegetable product, as specified. 3)Provides exemption from licensing several classes of products, including flower or agricultural or vegetable seed not purchased from a producer. 4)Establishes the California Seed Law (CSL) which requires every labeler of specified seeds for sale or that is sold in this state, or persons receiving or possessing seeds for sale or that sells in this state, to annually register with CDFA, as specified, and to pay an annual assessment that funds the activities of this law. 5)Requires labeling requirements for seed sold and that regulations be adopted for germination standards, enforcement tolerances and examination procedures, sampling methods, schedule of fees, and other such regulations, as specified. These regulations are required to be as near as practicable to the Federal Seed Act (FSA). FISCAL EFFECT: According the Assembly Appropriations Committee, this bill has minor and absorbable costs to DFA and a potential loss of fee revenue to MEB of up to $68,000 from seed dealers who no longer need to be licensed under the Producer Dealers Act. AB 264 Page 3 COMMENTS: MEB has regulatory and fee authority over all farm products, which includes a broad definition of agricultural products. There are several exemptions to MEB authority, including flower or agricultural or vegetable seed not purchased from a producer. MEB enforces laws to protect against unfair business practices between those who grow, package, and process California farm products. CSL was enacted in 1967 to ensure that agricultural and vegetable seed is properly and accurately identified on the product label and that it meets quality standards, including germination, variety and species. Seed labeling and standards are also regulated under FSA. According to the author, over the past few years there has been increasing confusion over which seed transactions are subject to MEB oversight, which dealers need to obtain licenses, and which seeds are regulated by CSL. Furthermore, MEB staff have been citing seed dealers and threatening them with fines unless they register as produce dealers under MEB. The sponsor of this bill states it will simplify all seed transactions and consolidate them under the governance of CSL and FSA. Funding for the CSL program is through industry seed assessments and registration fees and is administered by CDFA. Furthermore, the sponsor stresses that there have not been any complaints from seed farmers to MEB in more than five years. In conversations, the sponsors pointed out that the seed industry is a highly regulated industry with both state and federal laws, and that only a small number of transactions in California fall under MEB rules. This bill will help streamline seed transactions, while still protecting buyers, sellers and the public. Analysis Prepared by: Victor Francovich / AGRI. / (916) 319-2084 FN: AB 264 Page 4 0000325