BILL ANALYSIS Ó AB 2324 Page 1 Date of Hearing: March 30, 2016 ASSEMBLY COMMITTEE ON AGRICULTURE Bill Dodd, Chair AB 2324 (Eggman) - As amended March 18, 2016 SUBJECT: Certified farmers' markets. SUMMARY: Recasts definitions and adds vendor record keeping requirements to the Certified Farmers' Market (CFM) Law; requires records to be made available to specified enforcement agencies; and, makes technical changes. Specifically, this bill: 1)Adds "wool" to the definition of "agricultural product" and adds that a non-agricultural product may be sold in a CFM if the market operator ensures the following conditions are satisfied: a) The product is composed entirely of agricultural products grown by the producer, except for incidental ingredients and flavoring; and, b) The product is being offered for sale by a producer who is otherwise authorized to sell agricultural products at a CFM. AB 2324 Page 2 2)Requires the Secretary (Secretary) of the California Department of Food and Agriculture (CDFA), in adopting regulations for CFMs, to endeavor to keep costs to farmers and CFM operators to a minimum. 3)Rewords authority to adopt regulations for CFMs by referencing item 2) above and that regulations promote and foster honest selling activities. 4)Requires all CFM vendors to keep product identity, variety, and quantity of sales records for all product sales to consumers from each CFM the vendor attends and requires the vendors to maintain these records for at least 12 months from date of sale. 5)Requires vendors to keep product identity and relative measured weight or volume records for all unprocessed agricultural products delivered to a processing facility for processing into a product intended for sale to the public, including name and address of processor, the date delivered to processor, the date processed product was delivered to vendor, the character and type of processed agricultural product produced and the relative measured weight or volume of processed product produced. These records are to be maintained for 12 months from the date vendor received product from processor. 6)Requires, upon written request that identifies, specifically, information requested by a county or state enforcement agency, that these records be made available within three business days or within a similar period of time that is reasonable at the time of the request. 7)Requires a CFM operator, upon request by a state or county AB 2324 Page 3 enforcement agency pursuant to an investigation of false or misleading marketing by a vendor, to note and make a record of the products that vendor offers for sale at each market, and to make those records available within three days of a written request by the agency. This requirement shall not preclude a CFM operator from establishing other requirements for vendors to sell at their CFMs. 8)Requires county agricultural commissioners to send a digital copy of each certified producer's certificate issued and requires CDFA to post each certificate on their internet site in a timely manner. 9)Deletes the requirement for CDFA to maintain a statewide listing of certified producers, replacing that list with a required online, publically accessible database listing of current certified producers' certificates. 10)Makes technical changes. EXISTING LAW: Provides for the regulation of certified farmers' markets and authorizes the Secretary to adopt regulations to encourage the direct sale by farmers to the public of all types of California agricultural products; requires vendors of agricultural products selling within a certified farmers' market to comply with specified requirements; makes it unlawful to violate the provisions regulating certified farmers' markets, and authorizes the Secretary or a county agricultural commissioner, in lieu of prosecution, to levy a civil penalty against a person who violates those provisions; and, requires a producer to obtain a certified producer's certificate from a county agricultural commissioner before selling at a certified farmers' market and requires CDFA to maintain a current listing of certified producers. AB 2324 Page 4 Exempts farmers that market direct to consumers from standard pack and size requirements; establishes requirements for CFMs and producers to be certified; authorizes CDFA to adopt regulations to permit the direct selling of certified agricultural products to consumers; authorizes the collection of up to two dollars ($2.00) per producer per market day to be used for administration, inspection and enforcement; provides for the appointment of a 17 member advisory committee; permits CFMs to establish rules and procedures that are more restrictive than the state rules; provides for civil penalties for violations of rules; provides for an appeal and decision process by CDFA; creates a crime by establishing a violation and provides enforcement provisions that sunset January 1, 2018; and, allows CDFA to appoint ad hoc advisory committees to assist in the administration of programs under this authority. FISCAL EFFECT: Unknown. COMMENTS: According to the author, AB 2324 is completing the efforts started by AB 1871 (Dickinson), of the 2013-14 legislative session. That bill rewrote definitions and expanded the requirements, exemptions, and fees for CFM, their operators and vendors, and adjacent non-agricultural markets, and increased penalties for violations. This bill adds record keeping for farmers of their sales and products, along with record keeping requirements by CFM operators when an investigation into false or misleading sales activities occurs. It also makes other less significant changes. Certified farmers' markets have become established in many California communities, as have other outlets for direct marketing, such as farm stands and community supported agriculture. There are roughly 800 farmers' markets in California, a significant number of which operate year-round. Following the enactment of the Federal Farmer to Consumer Direct AB 2324 Page 5 Marketing Act of 1976, CDFA enacted regulations that exempted farmers from packing, sizing and labeling requirements for fresh fruits, nuts, and vegetables, and enabled them to sell products they grow at farmers' markets, provided they receive certification from a county agriculture commissioner (CAC). The certification process is to assure the consumer that the product is grown by the seller. Further, farmers must have a sign that they sell what they grow. As CFMs have become more popular, the willingness of a few producers to sell whatever they could became a concern to many CFM operators. In 1999, they came to the Legislature and enacted a daily per stall fee of sixty cents, intending it to be used by CDFA and CAC for inspections and enforcement purposes. Due to the growth of the program and reductions in General Fund to CDFA and reductions to CAC's budgets, the fee has had to be used to administer the program and not for inspection and enforcement, as it was intended. AB 1871 raised this fee to $2.00 per stall per day. This has significantly improved CDFA's funding of this program and will allow for more inspections of selling practices of CFM vendors. Several years ago a Los Angeles television station did an undercover story, exposing a certified producer who was not producing what he was selling, causing much concern to the publics' confidence in buying from CFMs. This prompted the multi-year effort to update the statutes that govern CFMs; AB 2324 is another step in that effort. RELATED LEGISLATION: AB 1252 (Health), Chapter 556, Statutes of 2014, made various technical, clarifying, and conforming changes to the California Retail Food Code, the state's principal law governing food safety and sanitation in retail food facilities, AB 2324 Page 6 and made changes necessary to implement California's cottage food operations law. AB 2539 (Ting), Chapter 907, Statutes of 2014, made various changes to the rules governing CFMs, including requiring all meat products offered for sale in a farmers' market to be from approved sources and to be maintained at 41 degrees Fahrenheit, prohibiting smoking of nicotine products within 25 feet of the commerce area of the farmers' market, and prohibiting the self-serving of food samples. AB 1871 (Dickinson), Chapter 579, Statutes of 2014, recast and expanded the requirements, exemptions, and fees for Certified Farmers' Markets (CFM), their operators and vendors, and adjacent non-agricultural markets, and increases penalties for violations. This bill deletes the January 1, 2018, sunset provisions for this chapter, making its provisions permanent. AB 224 (Gordon), Chapter 404, Statutes of 2013, created definitions dealing with requirements for Consumer Supported Agriculture (CSA); and, authorized CDFA to establish fees, not to exceed $100, to administer this new program, as specified. AB 654 (Hall), Chapter 409, Statutes of 2013, extended the sunset date to January 1, 2018, for the collection of CFM operator fees and enforcement provisions. REGISTERED SUPPORT / OPPOSITION: AB 2324 Page 7 Support Agricultural Council of California California Farm Bureau Federation Certified Farmers' Markets of Sacramento Community Alliance with Family Farmers Myrrhia Fine Knitwear Pacific Coast Farmers' Market Association 1 individual Opposition None on file. AB 2324 Page 8 Analysis Prepared by:Jim Collin / AGRI. / (916) 319-2084