BILL ANALYSIS
AB 547
Page 1
Date of Hearing: April 29, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 547 (Mendoza) - As Introduced: February 25, 2009
Policy Committee: AgricultureVote:8
- 0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill extends the sunset date for the Secretary of Food and
Agriculture's authority to establish and collect a license fee
and tonnage tax on commercial animal feed. Specifically, this
bill:
1)Extends from January 1, 2010, to January 1, 2015, the
authority of the California Department of Food and Agriculture
(CDFA) to establish an annual license fee range from $100 to
$600 for each location where commercial feed is stored,
manufactured, sold or distributed. On January 1, 2015, absent
further extension, the fee will be reduced to a flat $100 per
location.
2)Extends from January 1, 2010, to January 1, 2015, the
authority of the CDFA to designate 15%, or $200,000, whichever
amount is greater, of the revenue from the inspection tonnage
tax to be used for education and research regarding the safe
handling of commercial feed.
3)Extends from January 1, 2010, to January 1, 2015, the
authority of the CDFA to impose an inspection tonnage tax of
up to $0.15 per ton for the sale of commercial feed.
FISCAL EFFECT
1)There are no costs associated with this legislation either for
the CDFA Feed Inspection Program funds or the state General
Fund.
2)In 2008, the Commercial Feed License Fee generated $530,000 in
AB 547
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revenue for the program. Without the extension of the sunset
for the enhanced fee authority, the revenue will fall to
approximately $180,000, a loss of $350,000 in revenue for the
program.
3)Over the last three years the commercial feed tonnage tax has
provided $2.1 million in revenue annually for operating the
feed inspection program. Currently, the tax is not at the
maximum allowed under the law. The current rate is $0.12 per
ton.
COMMENTS
1)Purpose . The intent of this legislation is to continue the
enhanced funding of the commercial feed inspection program
until January 1, 2015. Without this extension, funding would
be inadequate to maintain the current program.
2)Background . The Feed Inspection Program was established to
ensure the quality and safety of commercial feed and that it
was being properly handled. Inspecting the feed further
ensures the health and safety of animals and our food supply.
Several years ago, the funding of the program was below its
needs and the reserves had been depleted. The industry
stepped forward with legislation to address these concerns by
increasing the industry licensing fees. These changes have
been successful in continuing the program and inspections.
3)Related Legislation . AB 2958 (Agriculture; Statutes of 2006,
Chapter 285) allowed commercial feed to be sold by volume, in
addition to weight; replaced the $100 biennial commercial feed
license fee with an annual fee of at least $100, but not more
than $600, upon recommendation of the Board, until January 1,
2010; required the license fee revenue to replenish the
Program reserves to 25% of its expenditures, after which point
the license fee revenue must be used to reduce feed tonnage
taxes to a level recommended by the Board; and, increased,
from $40 to $100, the penalty imposed for late renewal of a
commercial feed license.
Analysis Prepared by : Julie Salley-Gray / APPR. / (916)
319-2081