BILL ANALYSIS
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|SENATE RULES COMMITTEE | AB 547|
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THIRD READING
Bill No: AB 547
Author: Mendoza (D)
Amended: As introduced
Vote: 21
SENATE FOOD AND AGRICULTURE COMMITTEE : 4-0, 7/7/09
AYES: Florez, Maldonado, Hancock, Hollingsworth
NO VOTE RECORDED: Pavley
SENATE APPROPRIATIONS COMMITTEE : 13-0, 7/23/09
AYES: Kehoe, Cox, Corbett, Denham, Hancock, Leno, Oropeza,
Price, Runner, Walters, Wolk, Wyland, Yee
ASSEMBLY FLOOR : 80-0, 5/11/09 - See last page for vote
SUBJECT : Commercial feed: license fee: inspection
tonnage tax
SOURCE : California Grain and Seed Association
DIGEST : This bill extends the sunset date from January
1, 2010 to January 15, 2015 for the Secretary of the
Department of Food and Agriculture to (1) set a specific
fee for feed licenses, and (2) designate a specified amount
of commercial feed tonnage taxes collected be provided for
funding for research and education regarding the safe
manufacture, distribution, and use of commercial feed.
ANALYSIS : The Feed Inspection Program is responsible for
inspecting feed to assure buyers of proper labeling,
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quality, and quantity from manufacturers of commercial feed
and ensure that commercial feed will not threaten food
safety. The Feed Inspection Program receives its funding
from both commercial feed license fees and feed tonnage
tax.
Current law requires that any person who manufactures,
sells, or stores commercial feed shall obtain a license
from the Department of food and Agriculture (DFA) per
commercial feed location. Any person who is engaged in
retail sales of feed is exempt from the license
requirement. The license is issued annually and is
accompanied by a fee of not less than $100 and not more
than $600 as recommended by the Feed Inspection Advisory
Board. After January 1, 2010, the license fee will be
$100. In the event of a late renewal of the commercial
feed license, a penalty of $100 is added to the fee.
Revenues from the licensing fee are used to replenish feed
inspection program reserves up to 25 percent of program
expenditures after which the revenues are used to reduce
feed tonnage taxes upon recommendation of the Feed
Inspection Advisory Board. The licensing fee is due to
sunset January 1, 2010.
The feed tonnage tax may not be more than $0.15 per ton of
commercial feed, except for whole grains and whole hays
unmixed, sold to a consumer-buyer in this state. The rate
of the feed tonnage tax is determined by DFA with
recommendation from the Feed Inspection Advisory Board.
Based on the recommendation of the Feed Inspection Advisory
Board, DFA may designate up to 15 percent of the tonnage
taxes collected, or $200,000, whichever is greater, to fund
research and education on the safe maintenance,
distribution, and use of commercial feed. This
authorization for research and education funding is due to
sunset on January 1, 2010.
This bill:
1.Extends the sunset date for the reduction of the
commercial feed license fee to $100 from 2010 to 2015.
2.Extends the sunset date for DFA to designate 15 percent,
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or $200,000, whichever is greater, for research and
education on the safe maintenance, distribution, and use
of commercial feed from 2010 to 2015.
FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes
Local: No
Fiscal Impact (in thousands)
Major Provisions 2009-10 2010-11
2011-12 Fund
Sunset extension $ 265 $ 530
$ 530 Special*
(revenue) $1,050 $2,100
$2,100 Special**
*Commercial Feed License Fee
**Commercial Feed tonnage Tax, both deposited in the Food
and
Agriculture Fund
According to the Senate Appropriations Committee analysis,
in 2008, the Commercial Feed License Fee generated $530,000
in revenue. Without a sunset extension for the enhanced
fee authority, the revenue would fall to approximately
$180,000, a loss of $350,000.
Over the last three years, the commercial feed tonnage tax
has generated $2.1 million annually for the operation of
the feed inspection program. Currently, this tax is not at
the maximum allowed by statute ($0.15 per ton). The
current rate is $0.12 per ton.
SUPPORT : (Verified 7/23/07)
California Grain and Feed Association (source)
Pacific Egg and Poultry Association
ARGUMENTS IN SUPPORT : Proponents of this bill state
that, by extending the sunset for the feed inspection
program funding authority, this bill will help continue
both the Feed Inspection Program and the Safe Animal Feed
Education Program for another five years. These programs
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support feed inspection, enforcement, and education of feed
manufacturers on safe animal feed handling, storage, and
ingredient integrity.
ASSEMBLY FLOOR :
AYES: Adams, Ammiano, Anderson, Arambula, Beall, Bill
Berryhill, Tom Berryhill, Blakeslee, Block, Blumenfield,
Brownley, Buchanan, Caballero, Charles Calderon, Carter,
Chesbro, Conway, Cook, Coto, Davis, De La Torre, De Leon,
DeVore, Duvall, Emmerson, Eng, Evans, Feuer, Fletcher,
Fong, Fuentes, Fuller, Furutani, Gaines, Galgiani,
Garrick, Gilmore, Hagman, Hall, Harkey, Hayashi,
Hernandez, Hill, Huber, Huffman, Jeffries, Jones, Knight,
Krekorian, Lieu, Logue, Bonnie Lowenthal, Ma, Mendoza,
Miller, Monning, Nava, Nestande, Niello, Nielsen, John A.
Perez, V. Manuel Perez, Portantino, Price, Ruskin, Salas,
Saldana, Silva, Skinner, Smyth, Solorio, Audra
Strickland, Swanson, Torlakson, Torres, Torrico, Tran,
Villines, Yamada, Bass
TSM:cm 8/17/09 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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