BILL ANALYSIS Ó 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 ?