The California Department of Food and Agriculture (CDFA) has reset the date and time and format for a public hearing to consider a petition submitted by the STOP QIP group, which seeks to Suspend Chapter 3.5 of the Food and Agriculture Code. The signatures submitted by STOP QIP on a petition were verified by CDFA earlier this year and a hearing was scheduled for April 7-8 in Visalia. The onset of the COVID pandemic and the subsequent health related orders prohibiting gatherings caused CDFA to postpone the hearing. But the hearing has now been rescheduled to June 9-10, starting both days at 9 a.m., and will be held with the use of Microsoft Team Meetings.
The call of the hearing is very narrow: “The Department seeks stakeholder and public comment on whether a producer referendum should be conducted pursuant to Chapter 3.5, specifically Food and Agriculture Code sections 62753-62755.”
This will be a hearing that is presided over by an Administrative Law Judge who will act as the hearing officer. A hearing procedures document outlines that the STOP QIP organization – the petitioners – will be the first witnesses after CDFA submits any exhibits into the hearing record. STOP QIP will have one hour to submit testimony. After they are finished, any other organized producer groups who register at least one week ahead of the hearing will be granted 30 minutes to give their testimony. After the testimony from these groups, then individuals will be able to testify for 5 minutes each. In addition to oral testimony, written testimony of any length (provided it is on topic) can be submitted before and during the hearing by any interested party. Witness testimony will be received under oath and a representative of the California Attorney General’s office may question any witness. However, there will be no cross examination of witnesses allowed by anyone else.
This hearing is required by law because the Stop QIP group was successful in obtaining the signatures of 28% of the number of market milk producers operating in California in January of 2020 who produced in excess of 33% of the market milk on a petition requesting a referendum to suspend Chapter 3.5 of the Food and Agriculture Code. While the hearing notice does not explicitly say this, conversations with CDFA officials indicate that it is the Administrative Law Judge who will actually be developing a recommendation to the California Secretary of Agriculture based on the hearing record about whether to hold a referendum to suspend Chapter 3.5.
Here is what is at stake in this hearing: It is in Chapter 3.5 that CDFA received the authority from the Legislature in 2017 to create a stand-alone quota program that would function after California became part of the Federal Milk Marketing Order system. The vote threshold to suspend Chapter 3.5 is lower than the vote threshold contained in Chapter 3.0 of the Food and Agriculture Code which originally established the California pooling and quota program. Chapter 3.0 requires a super majority vote to adopt, change or terminate the pooling program and was the voting procedure that was used to create the QIP in the first place. Chapter 3.5 requires a 51% favorable vote to continue the Chapter. Said another way, 49.1% voting “no” suspends Chapter 3.5. If Chapter 3.5 is suspended, the authority of CDFA to collect assessments to fund the quota payments is also suspended. Interestingly, a vote to discontinue chapter 3.5 does not technically terminate the quota program, but it does eliminate the authority of CDFA to collect an assessment to fund a stand-alone quota program. Obviously, without a funding source, quota would not have any value.
The issue of quota is a very personal one. There are strong passions on all sides. This hearing is an opportunity for every producer to have their say. If you do not feel comfortable speaking at the hearing, you can write your thoughts and submit them by email to CDFA.LegalOffice@cdfa.ca.gov or by mail to CDFA Legal Office, 1220 N St. Sacramento, CA 95814.
Geoff Vanden Heuvel
Director of Regulatory and Economic Affairs