BILL ANALYSIS                                                                                                                                                                                                    



          SENATE COMMITTEE ON APPROPRIATIONS
                             Senator Ricardo Lara, Chair
                            2015 - 2016  Regular  Session

          AB 1826 (Mark Stone) - Organic products
          
           ----------------------------------------------------------------- 
          |                                                                 |
          |                                                                 |
          |                                                                 |
           ----------------------------------------------------------------- 
          |--------------------------------+--------------------------------|
          |                                |                                |
          |Version: June 30, 2016          |Policy Vote: AGRI. 5 - 0        |
          |                                |                                |
          |--------------------------------+--------------------------------|
          |                                |                                |
          |Urgency: No                     |Mandate: Yes                    |
          |                                |                                |
          |--------------------------------+--------------------------------|
          |                                |                                |
          |Hearing Date: August 1, 2016    |Consultant: Robert Ingenito     |
          |                                |                                |
           ----------------------------------------------------------------- 
          
          This bill meets the criteria for referral to the Suspense File.


          


          Bill  
          Summary: AB 1826 would (1) modify the California Organic  
          Products Act of 2003, (2) revise the composition of the  
          California Organic Products Advisory Committee, (3) revise  
          registration fee payment tiers based on gross product sales, and  
          (4) revise required information provided during registration and  
          for recordkeeping.


          Fiscal  
          Impact: To implement the requirements of this measure, the  
          California Department of Food and Agriculture (CDFA) estimates a  
          one-time cost of $107,000 for reprogramming the State Organics  
          Program's (SOP's) online registration system and database which  
          can be absorbed within SOP's Department of Food and Agriculture  
          Fund reserve. Specifically, CDFA would have to restructure the  
          application process, data collection and assignments, and the  
          fee schedule. 







          AB 1826 (Mark Stone)                                   Page 1 of  
          ?
          
          

          In addition, CDFA anticipates a reduction in annual revenue of  
          approximately $164,000 (Department of Food and Agriculture Fund)  
          resulting from the reduction and consolidation of fee categories  
          and the removal of registration requirements for specified  
          operations.


          Background: Federal, state, and local agencies are all participate in the  
          regulation of organic products. California's SOP was created  
          under the California Organic Foods Production Act of 1990. The  
          federal Organic Foods Production Act of 1990 authorized the  
          United States Department of Agriculture (USDA) to establish the  
          National Organic Program (NOP).  Once the NOP was fully  
          implemented in 2002, California renamed and revised the act to  
          the California Organic Products Act of 2003 to incorporate NOP  
          standards and regulations in conjunction with the SOP.
          California is the only state with its own organic program.  The  
          SOP requires organic producers, processors, handlers, retailers,  
          wholesalers, and brokers to register with CDFA to verify SOP  
          compliance throughout the production and supply chain.   
          Registration fees range from $25 to $3,000 annually depending on  
          size of production; however, producers whose annual organic  
          gross sales are $5,000 or less are exempt from registration.   
          Fees are used by CDFA to fulfill responsibilities under the SOP.  
           On the local level, county agricultural commissioners (CAC)  
          contract with CDFA to provide SOP enforcement and compliance.


          On the federal level, the NOP provides national regulatory  
          oversight and enforcement of USDA organic standards.  The NOP  
          determines which materials may be used in organic production and  
          periodically reviews and updates these standards, investigates  
          complaints and violations, and provides accreditation for  
          third-party organic certifiers.


          Under current law, CDFA, through the SOP, registers and enforces  
          organic provisions related to raw agricultural products. SOP's  
          enforcement activities are coordinated with the Department of  
          Public Health, who regulates the processing or handling of  
          processed products, the USDA's NOP, and county agriculture  
          commissioners, who registers local producers and handlers.  
          Currently, SOP's activities include program administration;  








          AB 1826 (Mark Stone)                                   Page 2 of  
          ?
          
          
          county biologist training; spot inspections; residue testing and  
          sampling; complaint investigations; registration; and, providing  
          information and guidance to the California organic industry.  


          The federal NOP program recognizes SOP as a state organic  
          program and has delegated enforcement of federal organic  
          standards and regulations to SOP.




          Proposed Law:  
          This bill would, among other things, do the following:
                 Rename the California Organic Products Act of 2003 as  
               the California Organic Food and Farming Act (Act).


                 Change the membership of the advisory committee as  
               specified. 


                 Authorize CDFA, in consultation with the advisory  
               committee, to establish procedures and conduct all of the  
               following activities, to the extent that funds are  
               available: receive and investigate complaints; conduct  
               periodic spot inspections and prohibited substance testing;  
               conduct farmers' market inspections; support organic  
               agriculture through education, outreach and other  
               programmatic activities; reimburse investigation,  
               enforcement and market surveillance expenses; and conduct  
               hearings, appeals, mediation or settlement conferences.


                 Require investigation, inspection, and prohibited  
               material testing reports to be forwarded to CDFA for  
               enforcement.


                 Require CDFA to coordinate SOP activities with other  
               county and state licensing, registration, inspection, and  
               fee collection procedures.










          AB 1826 (Mark Stone)                                   Page 3 of  
          ?
          
          
                 Require any monies collected pursuant to the Food and  
               Agricultural Code sections of the Act to be used solely to  
               fulfill the responsibilities authorized under the same  
               sections of the Act.


                 Require only persons engaged in the production or  
               handling of raw agricultural products sold as organic and  
               processors of organically derived products to be registered  
               with CDFA.


                 Categorize organic product registrants as follows:  
               citrus; fruits excluding citrus,  and vegetable row crops;  
               livestock or dairy; nuts; vegetables; other, such as herbs,  
               mushrooms, cut flowers, and nursery.


                 Require registrants to provide the address or assessor's  
               parcel number of the precise location where products are  
               produced, processed, or handled.


                 Delete the requirement that exempt producers provide  
               additional information regarding the production area, such  
               as a map and documentation of the previous 36-month land  
               use history.


                 Delete the requirement that, during registration, exempt  
               producers provide a list of all substances applied or used.


                 Consolidate fee schedule categories by combining  
               producers with gross sales of $10,000 to $50,000 into one  
               group with a registration fee of $75 and combine producers  
               with gross sales of $50,000 to $250,000 into a group with a  
               registration fee of $100.


                 Delete a variety of fees and registration requirements  
               placed on small producers, brokers, retail stores, and  
               persons hiring custom packing or labeling.









          AB 1826 (Mark Stone)                                   Page 4 of  
          ?
          
          

                 Exempt the adoption, amendment, or repeal of any fee  
               from California state administrative procedures and only  
               requires the Office of Administrative Law to publish a  
               notice of the fee change.


                 Require CDFA, in consultation with the director of the  
               California Department of Public Health, to coordinate  
               registration and annual fee collection procedures.


                 Remove the authority of county agricultural  
               commissioners to deny a registration submission that is  
               incomplete or not in compliance.


                 Limit the registration fee for certifying agencies to  
               $500 annually.


                 Delete specific, prescribed, record keeping requirements  
               and, instead, requires the secretary, in consultation with  
               the Advisory Board, to determine what data and records  
               should be kept by registrants.




          



          Related  
          Legislation: AB 2612 (Agriculture), Chapter 393, Statutes of  
          2010.  Among other provisions, requires organic producers to  
          include a detailed physical description of the location where  
          organic products are produced and requires exempt producers to  
          include a map, as specified, and exempts producers whose annual  
          organic gross sales are $5,000 or less.


                                      -- END --









          AB 1826 (Mark Stone)                                   Page 5 of  
          ?