BILL ANALYSIS                                                                                                                                                                                                    



                                                                     SB 746


                                                                    Page  1





          Date of Hearing:  July 7, 2015


                            ASSEMBLY COMMITTEE ON HEALTH


                                  Rob Bonta, Chair


          SB  
          746 (Wolk) - As Introduced February 27, 2015


          SENATE VOTE:  34-0


          SUBJECT:  Food safety:  grist mills.


          SUMMARY:  Exempts from the requirements to register as a food  
          processing facility and also exempts from the definition of a  
          food facility, and therefore provisions of the California Retail  
          Food Code (CRFC), a historic water-driven grist mill in order to  
          allow grain to be milled, packaged and sold at the mill without  
          having to meet the requirements of a food processing facility or  
          a retail food facility.  Specifically, this bill: 


          1)Exempts from the requirement to register as a food processing  
            facility, beginning January 1, 2018, the milling, packaging,  
            and selling of grain produced and sold at a water-driven grist  
            mill on the National Register of Historic Places, provided: 

             a)   Best management practices suitable for a historic  
               water-driven grist mill are followed for the processing and  
               handling of the product; 

             b)   The flour is identified as being produced in a historic  
               mill using traditional methods; and 








                                                                     SB 746


                                                                    Page  2








             c)   The product meets applicable federal food adulteration  
               purity standards.





          2)Exempts from the definition of food facility, beginning  
            January 1, 2018, for purposes of law requiring food facilities  
            to obtain a permit from California Department of Public Health  
            (DPH) or the local health agency having jurisdiction over the  
            food facility, a water-driven grist mill that is on the  
            National Register of Historic Places and that has onsite sales  
            of grain that is milled at the facility.



          3)Makes various legislative findings and declarations related to  
            the recent moratorium on the closure of state parks and the  
            use of innovative tools to stabilize the Department of Parks  
            and Recreation (DPR) and broaden its financial base, and that  
            a more entrepreneurial and robust revenue-generation strategy  
            must be established for the state parks.



          4)States the intent of the Legislature to encourage DPR and DPH  
            to consult with each other to develop and implement  
            additional, reasonable improvements designed to increase  
            public health security at the Bale Grist Mill State Historic  
            Park, without impairing or adversely affecting historical,  
            cultural, or natural resources.


          EXISTING LAW:    









                                                                     SB 746


                                                                    Page  3






          1)Prohibits any person from engaging in the manufacture,  
            packing, or holding of any processed food unless the person  
            has a valid registration as a food processing facility from  
            DPH.



          2)Exempts certain activities that are authorized under specific  
            permits and licenses from the food processing facility  
            registration requirements. 



          3)Prohibits any food facility from being open for business  
            without a valid permit from DPH or the local health agency  
            having jurisdiction over the food facility.



          4)Defines "food facility" as an operation that stores, prepares,  
            packages, serves, vends, or otherwise provides food for human  
            consumption at the retail level.



          5)Establishes various requirements that food facilities must  
            meet, including requiring that the interior floor, sides, and  
            top of the food holding area to be constructed of a smooth,  
            washable, impervious material capable of withstanding frequent  
            cleaning.



          6)Exempts from the definition of "food facility" certain  
            specified entities, including premises operated by a producer  
            that sells only whole produce grown by the producer, provided  
            the sales are conducted on premises controlled by the  
            producer.








                                                                     SB 746


                                                                    Page  4







          7)Defines, under the federal Food, Drug, and Cosmetic Act, food  
            purity standards and deems food adulterated, or not fit for  
            human consumption, if that food is prepared, packed, or held  
            under insanitary conditions.


          FISCAL EFFECT:  This bill is keyed non-fiscal.


          COMMENTS: 


          1)PURPOSE OF THIS BILL.  According to the author, in 2011, as  
            part of the Governor's efforts to cut state expenditures, the  
            Bale Grist Mill and 69 other state parks were selected for  
            closure.  The Napa County Regional Park and Open Space  
            District, in partnership with the Napa Valley State Parks  
            Association, is working to keep the mill open to the public.   
            Selling flour produced at the mill is an important element in  
            generating the revenues needed to keep this National Historic  
            Landmark open to the public.  Because the mill is not  
            registered as either a retail food facility or a food  
            processing facility, the grain sold at the mill must be  
            labeled as not fit for human consumption.  The author states  
            that the grist mill is a very clean, neat and well maintained  
            facility, best management practices are used, and the flour  
            which is produced is safe and healthy.


          2)Bale Grist Mill State Historic Park.  The Bale Grist Mill  
            State Historic Park is located near St. Helena in Napa County.  
             The water-powered mill was built in 1846.  The Bale Grist  
            Mill was registered as a California historical landmark on  
            October 9, 1939.  In 1972, Bale's Grist Mill was entered on  
            the National Register of Historic Places.  In 1974, it was  
            conveyed to the California State Park System for preservation  
            and eventual restoration as Bale Grist Mill State Historic  








                                                                     SB 746


                                                                    Page  5





            Park.  The mill currently offers flour produced at the mill in  
            exchange for a donation, but it must be labeled as not fit for  
            human consumption because the mill is not registered as either  
            a retail food facility or food processing facility.


            AB 1589 (Huffman), Chapter 533, Statutes of 2012, required DPR  
            to develop a plan to increase revenues at state parks,  
            appropriated $10 million in Proposition 84 general obligation  
            bond funds for the installation of revenue collection  
            equipment and other improvements at state parks, and  
            authorized taxpayers to voluntarily contribute to the state  
            park system through the income tax system.


            The intention of this bill is to allow the Bale Grist Mill  
            additional revenue in order to make the mill operationally  
            self-sufficient.  The total operational expenses of the mill  
            for 2012 were $130,000.  Revenues from operation of the Bale  
            Grist Mill (entrance fees, sales of merchandise, donations for  
            flour, and special events at the Bale Grist Mill) for 2012  
            were $100,634.  The revenue currently generated from the sale  
            of milled grain is approximately $19,000 of the total revenue  
            each year.  The sponsors of this bill suggest that more grain  
            would be sold if it could be sold without the notice that it  
            is not fit for human consumption.


            This bill is nearly identical to SB 170 (Wolk) of 2014, which  
            would have taken effect on January 1, 2016.  In vetoing that  
            measure, Governor Brown directed DPH and the DPR to continue  
            working with representatives from the mill on other potential  
            solutions to the ongoing problems.  According to DPH,  
            representatives from DPH and DPR met several times with  
            representatives of the mill and the County to discuss possible  
            solutions. Despite everyone's best effort, these discussions  
            have identified no middle ground, either food is unsafe or the  
            historical integrity of the mill is lost.









                                                                     SB 746


                                                                    Page  6






          3)SUPPORT.  The Napa County Board of Supervisors (Napa County)  
            states that the Bale Grist Mill is one of only two remaining  
            water-driven mills west of the Mississippi River. Napa County  
            states that the mill currently sells flour produced at the  
            mill, but it must be labeled as not fit for human consumption  
            because the mill is not registered as either a retail food  
            facility or a food processing facility.  Napa County cannot  
            meet the standards for a retail food facility or a food  
            processing facility because the physical historic construction  
            of the mill makes it impossible to comply with current codes.   
            For example, wood floors are not allowed, the porous grinding  
            stone is not allowed, and contact between grain/flour and the  
            wood in the grain chutes and flour bins is not allowed.  Napa  
            County supports this bill to allow the Bale Grist Mill to be  
            financially viable and not dependent on state subsidies.


          4)OPPOSITION. DPH is opposed to this bill, stating that  
            "unfortunately, given the nature of the mill with wood  
            surfaces and dry ingredients used in the milling of flour,  
            there is no cleaning and sanitation process that will  
            eliminate the bacterial and viral pathogens left behind from  
            the rodent excreta and urine without increasing the  
            opportunity for other pathogens to grow and colonize the  
            area."  DPH continues to oppose carving out a narrow exemption  
            in the Health and Safety Code for only one food processing  
            facility that cannot meet current food safety requirements.   
            In addition, despite significant work at both the state and  
            local level, DPH believes the bill would not achieve what the  
            sponsor intends - exemption from food processing requirements.  
             


          5)RELATED LEGISLATION.  


             a)   AB 143 (Wood) expands an exemption in the CRFC allowing  
               wine tasting rooms that currently only serve crackers to  








                                                                     SB 746


                                                                    Page  7





               also serve pretzels or prepackaged non-potentially  
               hazardous foods.  AB 143 passed out of this committee on  
               April 21, 2015 with a vote of 16-0 and is currently pending  
               on the Senate floor (consent calendar).



             b)   AB 1076 (Mayes) exempts from the definition of a food  
               facility, a snack bar operated by a charitable nonprofit  
               organization and authorizes snack bars to undertake limited  
               food preparation, as defined.  AB 1076 is pending in  
               Assembly Health Committee.


          6)PREVIOUS LEGISLATION.  SB 170 (Wolk) of 2014, was nearly  
            identical to this bill, and would have taken effect on January  
            1, 2016.  Unlike SB 746, SB 170 was heard in the Assembly  
            Water, Parks, and Wildlife Committee.  SB 170 was vetoed by  
            the Governor, who stated: "Exempting these products by January  
            1, 2016, is premature, as no best management practices yet  
            exist for historic water-driven grist mills. I will direct the  
            Department of Public Health and the Department of Parks and  
            Recreation to continue working with proponents on this and  
            other potential solutions to help raise needed revenues."
          7)DOUBLE REFERRAL.  A request to refer this bill to the Assembly  
            Appropriations Committee has been approved by the Assembly  
            Rules Committee; upon passage in this Committee, this bill  
            will be referred to the Assembly Appropriations Committee.


          8)POLICY CONCERNS


             a)   Appropriate best management practices have not yet been  
               developed.  This bill requires that the mill follow food  
               processing and handling best management practices suitable  
               for a historic water-driven grist mill, but these practices  
               have not yet been developed.  This bill states legislative  
               intent, but does not require, that DPH and DPR develop  








                                                                     SB 746


                                                                    Page  8





               those practices.  The author has attempted to address the  
               Governor's veto message by allowing two years for  
               appropriate best management practices to be developed, but  
               it is unclear whether the parties involved will be able to  
               come agree on practices that protect both food safety and  
               the historical integrity of the mill.


             b)   Bats, cats, and rats. The mill's physical historic  
               construction means it cannot meet current-day codes for  
               retail food safety.  State law requires that a food  
               facility structure be free of mice, bats, cats, and flies,  
               which both supporters and opponents of this bill agree is  
               not possible without destroying the historic integrity of  
               the mill.  The Committee may wish to consider whether it is  
               inconsistent with the policies of this Committee to allow  
               an exemption from food safety standards for a facility  
               that, by definition, cannot possibly meet general food  
               safety protections, in particular exclusion of animals and  
               vermin.


             c)   Does this bill achieve its intended goal? The bill  
               requires the flour to meet federal food purity standards.   
               As California adopts all federal food safety regulations as  
               the State's regulations, it is unlikely the mill will be  
               able to meet the standard proposed by the bill and thus  
               would not be able to achieve exemption from state law as  
               desired.  Even if the mill were completely exempt from  
               state regulation, California cannot waive the federal food  
               standards in order to allow the mill to sell the flour  
               directly to consumers or restaurants for use in food.   
               Although the grain at the mill is offered in exchange for a  
               donation, rather than being sold, it is entering into  
               commerce and cannot meet federal or state purity standards.  
                The author may wish to consider whether, even under the  
               provisions of this bill, the grain would still be in  
               violation of federal and state food purity and adulteration  
               standards. 








                                                                     SB 746


                                                                    Page  9







          9)SUGGESTED AMENDMENT.  Upon vetoing SB 170, the Governor  
            directed DPH and DPR to work with stakeholders to develop best  
            management practices suitable for this mill.  This bill, as  
            drafted, only mentions that fact in legislative findings and  
            does not state in statute that the Bale Grist Mill would  
            follow the developed best management practices to protect food  
            safety.  To address this, the Committee suggests the author  
            amend this bill as follows: 


               (11) Beginning January 1, 2018, the milling,  
               packaging, and selling of grain produced and sold at a  
               water-driven grist mill on the National Register of  
               Historic Places, provided best management practices  
               developed in conjunction with Department of Public  
               Health and the Department of Parks and Recreation  
               suitable for a historic water-driven grist mill are  
               followed for the processing and handling of the  
               product, the flour is identified as being produced in  
               a historic mill using traditional methods, and the  
               product meets applicable federal food adulteration  
               purity standards. 


          REGISTERED SUPPORT / OPPOSITION:




          Support


          Napa County Regional Park and Open Space District (sponsor)


          Napa City Council









                                                                     SB 746


                                                                    Page  10






          Napa County Board of Supervisors




          Opposition


          Department of Public Health







          Analysis Prepared by:Dharia McGrew / HEALTH / (916)  
          319-2097