Southern dairy compact entered into--effective date--text of compact.
262.700. The Southern Dairy Compact, the full text of which ishereinafter set forth and confirmed by the Missouri legislature, is herebyentered into on behalf of the state of Missouri. The compact shall becomeeffective when enacted into law by at least two other states within thecompact group of states and when the consent of Congress has been obtained.The full text of said compact is as follows:
SOUTHERN DAIRY COMPACT
ARTICLE I. STATEMENT OF PURPOSE, FINDINGS
AND DECLARATION OF POLICY
1. Statement of purpose, findings and declaration of policy
The purpose of this compact is to recognize the interstate character ofthe southern dairy industry and the prerogative of the states under the UnitedStates Constitution to form an interstate commission for the southern region.The mission of the commission is to take such steps as are necessary to assurethe continued viability of dairy farming in the south, and to assure consumersof an adequate, local supply of pure and wholesome milk.
The participating states find and declare that the dairy industry is anessential agricultural activity of the south. Dairy farms, and associatedsuppliers, marketers, processors and retailers are an integral component ofthe region's economy. Their ability to provide a stable, local supply ofpure, wholesome milk is a matter of great importance to the health and welfareof the region.
The participating states further find that dairy farms are essential andthey are an integral part of the region's rural communities. The farmspreserve land for agricultural purposes and provide needed economic stimulifor rural communities.
In establishing their constitutional regulatory authority over theregion's fluid milk market by this compact, the participating states declaretheir purpose that this compact neither displace the federal order system norencourage the merging of federal orders. Specific provisions of the compactitself set forth this basic principle.
Designed as a flexible mechanism able to adjust to changes in a regulatedmarketplace, the compact also contains a contingency provision should thefederal order system be discontinued. In that event, the interstatecommission is authorized to regulate the marketplace in replacement of theorder system. This contingent authority does not anticipate such a change,however, and should not be so construed. It is only provided shoulddevelopments in the market other than establishment of this compact result indiscontinuance of the order system.
By entering into this compact, the participating states affirm that theirability to regulate the price which southern dairy farmers receive for theirproduct is essential to the public interest. Assurance of a fair andequitable price for dairy farmers ensures their ability to provide milk to themarket and the vitality of the southern dairy industry, with all theassociated benefits.
Recent, dramatic price fluctuations, with a pronounced downward trend,threaten the viability and stability of the southern dairy region.Historically, individual state regulatory action had been an effectiveemergency remedy available to farmers confronting a distressed market. Thefederal order system, implemented by the Agricultural Marketing Agreement Actof 1937, establishes only minimum prices paid to producers for raw milk,without preempting the power of states to regulate milk prices above theminimum levels so established.
In today's regional dairy marketplace, cooperative, rather thanindividual state action is needed to more effectively address the marketdisarray. Under our constitutional system, properly authorized states actingcooperatively may exercise more power to regulate interstate commerce thanthey may assert individually without such authority. For this reason, theparticipating states invoke their authority to act in common agreement, withthe consent of Congress, under the compact clause of the Constitution.
ARTICLE II. DEFINITIONS AND RULES OF CONSTRUCTION
2. Definitions
For the purposes of this compact, and of any supplemental or concurringlegislation enacted pursuant thereto, except as may be otherwise required bythe context:
(1) "Class I milk" means milk disposed of in fluid form or as a fluidmilk product, subject to further definition in accordance with the principlesexpressed in paragraph (b) of subsection three.
(2) "Commission" means the southern dairy compact Commission establishedby this compact.
(3) "Commission marketing order" means regulations adopted by thecommission pursuant to sections nine and ten of this compact in place of aterminated federal marketing order or state dairy regulation. Such order mayapply throughout the region or in any part or parts thereof as defined in theregulations of the commission. Such order may establish minimum prices forany or all classes of milk.
(4) "Compact" means this interstate compact.
(5) "Compact over-order price" means a minimum price required to be paidto producers for class I milk established by the commission in regulationsadopted pursuant to subsections nine and ten of this compact, which is abovethe price established in federal marketing orders or by state farm priceregulations in the regulated area. Such price may apply throughout the regionor in any part or parts thereof as defined in the regulations of thecommission.
(6) "Milk" means the lacteral secretion of cows and includes all skim,butterfat, or other constituents obtained from separation or any otherprocess. The term is used in its broadest sense and may be further defined bythe commission for regulatory purposes.
(7) "Partially regulated plant" means a milk plant not located in aregulated area but having class I distribution within such area. Commissionregulations may exempt plants having such distribution or receipts in amountsless than the limits defined therein.
(8) "Participating state" means a state which has become a party to thiscompact by the enactment of concurring legislation.
(9) "Pool plant" means any milk plant located in a regulated area.
(10) "Region" means the territorial limits of the states which areparties to this compact.
(11) "Regulated area" means any area within the region governed by anddefined in regulations establishing a compact over-order price or commissionmarketing order.
(12) "State dairy regulation" means any state regulation of dairyprices, and associated assessments, whether by statute, marketing order orotherwise.
3. Rules of construction
(a) This compact shall not be construed to displace existing federalmilk marketing orders or state dairy regulation in the region but tosupplement them. In the event some or all federal orders in the region arediscontinued, the compact shall be construed to provide the commission theoption to replace them with one or more commission marketing orders pursuantto this compact.
(b) The compact shall be construed liberally in order to achieve thepurposes and intent enunciated in subsection one. It is the intent of thiscompact to establish a basic structure by which the commission may achievethose purposes through the application, adaptation and development of theregulatory techniques historically associated with milk marketing and toafford the commission broad flexibility to devise regulatory mechanisms toachieve the purposes of this compact. In accordance with this intent, thetechnical terms which are associated with market order regulation and whichhave acquired commonly understood general meanings are not defined herein butthe commission may further define the terms used in this compact and developadditional concepts and define additional terms as it may find appropriate toachieve its purposes.
ARTICLE III. COMMISSION ESTABLISHED
4. Commission established
There is hereby created a commission to administer the compact, composedof delegations from each state in the region. The commission shall be knownas the Southern Dairy Compact Commission. A delegation shall include not lessthan three nor more than five persons. Each delegation shall include at leastone dairy farmer who is engaged in the production of milk at the time ofappointment or reappointment, and one consumer representative. Delegationmembers shall be residents and voters of, and subject to such confirmationprocess as is provided for in the appointing state. Delegation members shallserve no more than three consecutive terms with no single term of more thanfour years, and be subject to removal for cause. In all other respects,delegation members shall serve in accordance with the laws of the staterepresented. The compensation, if any, of the members of a state delegationshall be determined and paid by each state, but their expenses shall be paidby the commission.
5. Voting requirements
All actions taken by the commission, except for the establishment ortermination of an over-order price or commission marketing order, and theadoption, amendment or rescission of the commission's by-laws, shall be bymajority vote of the delegations present. Each state delegation shall beentitled to one vote in the conduct of the commission's affairs.Establishment or termination of an over-order price or commission marketingorder shall require at least a two-thirds vote of the delegations present.The establishment of a regulated area which covers all or part of aparticipating state shall require also the affirmative vote of that state'sdelegation. A majority of the delegations from the participating states shallconstitute a quorum for the conduct of the commission's business.
6. Administration and management
(a) The commission shall elect annually from among the members of theparticipating state delegations a chairperson, a vice-chairperson, and atreasurer. The commission shall appoint an executive director and fix his orher duties and compensation. The executive director shall serve at thepleasure of the commission, and together with the treasurer, shall be bondedin an amount determined by the commission. The commission may establishthrough its by-laws an executive committee composed of one member elected byeach delegation.
(b) The commission shall adopt bylaws for the conduct of its business bya two-thirds vote, and shall have the power by the same vote to amend andrescind these by-laws. The commission shall publish its by-laws in convenientform with the appropriate agency or officer in each of the participatingstates. The by-laws shall provide for appropriate notice to the delegationsof all commission meetings and hearings and of the business to be transactedat such meetings or hearings. Notice also shall be given to other agencies orofficers of participating states as provided by the laws of those states.
(c) The commission shall file an annual report with the Secretary ofAgriculture of the United States, and with each of the participating states bysubmitting copies to the governor, both houses of the legislature, and thehead of the state department having responsibilities for agriculture.
(d) In addition to the powers and duties elsewhere prescribed in thiscompact, the commission shall have the power:
(1) To sue and be sued in any state or federal court;
(2) To have a seal and alter the same at pleasure;
(3) To acquire, hold, and dispose of real and personal property by gift,purchase, lease, license, or other similar manner, for its corporate purposes;
(4) To borrow money and issue notes, to provide for the rights of theholders thereof and to pledge the revenue of the commission as securitytherefor, subject to the provisions of subsection eighteen of this compact;
(5) To appoint such officers, agents, and employees as it may deemnecessary, prescribe their powers, duties and qualifications; and
(6) To create and abolish such offices, employments and positions as itdeems necessary for the purposes of the compact and provide for the removal,term, tenure, compensation, fringe benefits, pension, and retirement rights ofits officers and employees. The commission may also retain personal serviceson a contract basis.
7. Rulemaking power
In addition to the power to promulgate a compact over-order price orcommission marketing orders as provided by this compact, the commission isfurther empowered to make and enforce such additional rules and regulations asit deems necessary to implement any provisions of this compact, or toeffectuate in any other respect the purposes of this* compact.
ARTICLE IV. POWERS OF THE COMMISSION
8. Powers to promote regulatory uniformity, simplicity, and interstatecooperation
The commission is hereby empowered to:
(1) Investigate or provide for investigations or research projectsdesigned to review the existing laws and regulations of the participatingstates, to consider their administration and costs, to measure their impact onthe production and marketing of milk and their effects on the shipment of milkand milk products within the region.
(2) Study and recommend to the participating states joint or cooperativeprograms for the administration of the dairy marketing laws and regulationsand to prepare estimates of cost savings and benefits of such programs.
(3) Encourage the harmonious relationships between the various elementsin the industry for the solution of their material problems. Conduct symposiaor conferences designed to improve industry relations, or a betterunderstanding of problems.
(4) Prepare and release periodic reports on activities and results ofthe commission's efforts to the participating states.
(5) Review the existing marketing system for milk and milk products andrecommend changes in the existing structure for assembly and distribution ofmilk which may assist, improve or promote more efficient assembly anddistribution of milk.
(6) Investigate costs and charges for producing, hauling, handling,processing, distributing, selling and for all other services performed withrespect to milk.
(7) Examine current economic forces affecting producers, probable trendsin production and consumption, the level of dairy farm prices in relation tocosts, the financial conditions of dairy farmers, and the need for anemergency order to relieve critical conditions on dairy farms.
9. Equitable farm prices
(a) The powers granted in this subsection and subsection ten shall applyonly to the establishment of a compact over-order price, so long as federalmilk marketing orders remain in effect in the region. In the event that anyor all such orders are terminated, this article shall authorize the commissionto establish one or more commission marketing orders, as herein provided, inthe region or parts thereof as defined in the order.
(b) A compact over-order price established pursuant to this sectionshall apply only to class I milk. Such compact over-order price shall notexceed one dollar and fifty cents per gallon at Atlanta, Ga., however, thiscompact over-order price shall be adjusted upward or downward at otherlocations in the region to reflect differences in minimum federal orderprices. Beginning in 1990, and using that year as a base, the foregoing onedollar fifty cents per gallon maximum shall be adjusted annually by the rateof change in the consumer price index as reported by the Bureau of LaborStatistics of the United States Department of Labor. For purposes of thepooling and equalization of an over-order price, the value of milk used inother use classifications shall be calculated at the appropriate class priceestablished pursuant to the applicable federal order or state dairy regulationand the value of unregulated milk shall be calculated in relation to thenearest prevailing class price in accordance with and subject to suchadjustments as the commission may prescribe in regulations.
(c) A commission marketing order shall apply to all classes and uses ofmilk.
(d) The commission is hereby empowered to establish a compact over-orderprice for milk to be paid by pool plants and partially regulated plants. Thecommission is also empowered to establish a compact over-order price to bepaid by all other handlers receiving milk from producers located in aregulated area. This price shall be established either as a compactover-order price or by one or more commission marketing orders. Whenever sucha price has been established by either type of regulation, the legalobligation to pay such price shall be determined solely by the terms andpurpose of the regulation without regard to the situs of the transfer oftitle, possession or any other factors not related to the purposes of theregulation and this compact. Producer-handlers as defined in an applicablefederal market order shall not be subject to a compact over-order price. Thecommission shall provide for similar treatment of producer-handlers undercommission marketing orders.
(e) In determining the price, the commission shall consider the balancebetween production and consumption of milk and milk products in the regulatedarea, the costs of production including, but not limited to the price of feed,the cost of labor including the reasonable value of the producer's own laborand management, machinery expense, and interest expense, the prevailing pricefor milk outside the regulated area, the purchasing power of the public andthe price necessary to yield a reasonable return to the producer anddistributor.
(f) When establishing a compact over-order price, the commission shalltake such other action as is necessary and feasible to help ensure that theover-order price does not cause or compensate producers so as to generatelocal production of milk in excess of those quantities necessary to assureconsumers of an adequate supply for fluid purposes.
(g) The commission shall whenever possible enter into agreements withstate or federal agencies for exchange of information or services for thepurpose of reducing regulatory burden and cost of administering the compact.The commission may reimburse other agencies for the reasonable cost ofproviding these services.
10. Optional provisions for pricing order
Regulations establishing a compact over-order price or a commissionmarketing order may contain, but shall not be limited to any of the following:
(1) Provisions classifying milk in accordance with the form in which orpurpose for which it is used, or creating a flat pricing program.
(2) With respect to a commission marketing order only, provisionsestablishing or providing a method for establishing separate minimum pricesfor each use classification prescribed by the commission, or a single minimumprice for milk purchased from producers or associations of producers.
(3) With respect to an over-order minimum price, provisions establishingor providing a method for establishing such minimum price for class I milk.
(4) Provisions for establishing either an over-order price or acommission marketing order may make use of any reasonable method forestablishing such price or prices including flat pricing and formula pricing.Provision may also be made for location adjustments, zone differentials andfor competitive credits with respect to regulated handlers who market outsidethe regulated area.
(5) Provisions for the payment to all producers and associations ofproducers delivering milk to all handlers of uniform prices for all milk sodelivered, irrespective of the uses made of such milk by the individualhandler to whom it is delivered, or for the payment of producers deliveringmilk to the same handler of uniform prices for all milk delivered by them.
(A) With respect to regulations establishing a compact over-order price,the commission may establish one equalization pool within the regulated areafor the sole purpose of equalizing returns to producers throughout theregulated area.
(B) With respect to any commission marketing order, as defined insubsection two, subdivision three, which replaces one or more terminatedfederal orders or state dairy regulations, the marketing area of now separatestate or federal orders shall not be merged without the affirmative consent ofeach state, voting through its delegation, which is partly or wholly includedwithin any such new marketing area.
(6) Provisions requiring persons who bring class I milk into theregulated area to make compensatory payments with respect to all such milk tothe extent necessary to equalize the cost of milk purchased by handlerssubject to a compact over-order price or commission marketing order. No suchprovisions shall discriminate against milk producers outside the regulatedarea. The provisions for compensatory payments may require payment of thedifference between the class I price required to be paid for such milk in thestate of production by a federal milk marketing order or state dairyregulation and the class I price established by the compact over-order priceor commission marketing order.
(7) Provisions specially governing the pricing and pooling of milkhandled by partially regulated plants.
(8) Provisions requiring that the account of any person regulated underthe compact over-order price shall be adjusted for any payments made to orreceived by such persons with respect to a producer settlement fund of anyfederal or state milk marketing order or other state dairy regulation withinthe regulated area.
(9) Provision requiring the payment by handlers of an assessment tocover the costs of the administration and enforcement of such order pursuantto article VII, subsection 18(a).
(10) Provisions for reimbursement to participants of the Women, Infantsand Children Special Supplemental Food Program of the United States ChildNutrition Act of 1966.
(11) Other provisions and requirements as the commission may find arenecessary or appropriate to effectuate the purposes of this compact and toprovide for the payment of fair and equitable minimum prices to producers.
ARTICLE V. RULEMAKING PROCEDURE
11. Rulemaking procedure
Before promulgation of any regulations establishing a compact over-orderprice or commission marketing order, including any provision with respect tomilk supply under subsection 9 (f), or amendment thereof, as provided inarticle IV, the commission shall conduct an informal rulemaking proceeding toprovide interested persons with an opportunity to present data and views.Such rulemaking proceeding shall be governed by Section 4 of the FederalAdministrative Procedure Act, as amended (5 U.S.C. § 553). In addition, thecommission shall, to the extent practicable, publish notice of rulemakingproceedings in the official register of each participating state. Before theinitial adoption of regulations establishing a compact over-order price or acommission marketing order and thereafter before any amendment with regard toprices or assessments, the commission shall hold a public hearing. Thecommission may commence a rulemaking proceeding on its own initiative or mayin its sole discretion act upon the petition of any person includingindividual milk producers, any organization of milk producers or handlers,general farm organizations, consumer or public interest groups, and local,state or federal officials.
12. Findings and referendum
(a) In addition to the concise general statement of basis and purposerequired by section 4 (b) of the Federal Administrative Procedure Act, asamended (5 U.S.C. § 553 (c)), the commission shall make findings of fact withrespect to:
(1) Whether the public interest will be served by the establishment ofminimum milk prices to dairy farmers under article IV.
(2) What level of prices will assure that producers receive a pricesufficient to cover their costs of production and will elicit an adequatesupply of milk for the inhabitants of the regulated area and for manufacturingpurposes.
(3) Whether the major provisions of the order, other than those fixingminimum milk prices, are in the public interest and are reasonably designed toachieve the purposes of the order.
(4) Whether the terms of the proposed regional order or amendment areapproved by producers as provided in subsection thirteen.
13. Producer referendum
(a) For the purpose of ascertaining whether the issuance or amendment ofregulations establishing a compact over-order price or a commission marketingorder, including any provision with respect to milk supply under subsection 9(f), is approved by producers, the commission shall conduct a referendum amongproducers. The referendum shall be held in a timely manner, as determined byregulation of the commission. The terms and conditions of the proposed orderor amendment shall be described by the commission in the ballot used in theconduct of the referendum, but the nature, content, or extent of suchdescription shall not be a basis for attacking the legality of the order orany action relating thereto.
(b) An order or amendment shall be deemed approved by producers if thecommission determines that it is approved by at least two-thirds of the votingproducers who, during a representative period determined by the commission,have been engaged in the production of milk the price of which would beregulated under the proposed order or amendment.
(c) For purposes of any referendum, the commission shall consider theapproval or disapproval by any cooperative association of producers, qualifiedunder the provisions of the Act of Congress of February 18, 1922, as amended,known as the Capper-Volstead Act, bona fide engaged in marketing milk, or inrendering services for or advancing the interests of producers of suchcommodity, as the approval or disapproval of the producers who are members orstockholders in, or under contract with, such cooperative association ofproducers, except as provided in subdivision (1) hereof and subject to theprovisions of subdivision (2) through (5) hereof.
(1) No cooperative which has been formed to act as a common marketingagency for both cooperatives and individual producers shall be qualified toblock vote for either.
(2) Any cooperative which is qualified to block vote shall, beforesubmitting its approval or disapproval in any referendum, give prior writtennotice to each of its members as to whether and how it intends to cast itsvote. The notice shall be given in a timely manner as established, and in theform prescribed, by the commission.
(3) Any producer may obtain a ballot from the commission in order toregister approval or disapproval of the proposed order.
(4) A producer who is a member of a cooperative which has providednotice of its intent to approve or not to approve a proposed order, and whoobtains a ballot and with such ballot expresses his approval or disapproval ofthe proposed order, shall notify the commission as to the name of thecooperative of which he or she is a member, and the commission shall removesuch producer's name from the list certified by such cooperative with itscorporate vote.
(5) In order to ensure that all milk producers are informed regardingthe proposed order, the commission shall notify all milk producers that anorder is being considered and that each producer may register his approval ordisapproval with the commission either directly or through his or hercooperative.
14. Termination of over-order price or marketing order
(a) The commission shall terminate any regulations establishing anover-order price or commission marketing order issued under this articlewhenever it finds that such order or price obstructs or does not tend toeffectuate the declared policy of this compact.
(b) The commission shall terminate any regulations establishing anover-order price or a commission marketing order issued under this articlewhenever it finds that such termination is favored by a majority of theproducers who, during a representative period determined by the commission,have been engaged in the production of milk the price of which is regulated bysuch order; but such termination shall be effective only if announced on orbefore such date as may be specified in such marketing agreement or order.
(c) The termination or suspension of any order or provision thereof,shall not be considered an order within the meaning of this article and shallrequire no hearing, but shall comply with the requirements for informalrulemaking prescribed by section four of the Federal Administrative ProcedureAct, as amended (5 U.S.C. § 553).
ARTICLE VI. ENFORCEMENT
15. Records; reports; access to premises
(a) The commission may by rule and regulation prescribe record keepingand reporting requirements for all regulated persons. For purposes of theadministration and enforcement of this compact, the commission is authorizedto examine the books and records of any regulated person relating to his orher milk business and for that purpose, the commission's properly designatedofficers, employees, or agents shall have full access during normal businesshours to the premises and records of all regulated persons.
(b) Information furnished to or acquired by the commission officers,employees, or its agents pursuant to this section shall be confidential andnot subject to disclosure except to the extent that the commission deemsdisclosure to be necessary in any administrative or judicial proceedinginvolving the administration or enforcement of this compact, an over-orderprice, a compact marketing order, or other regulations of the commission. Thecommission may promulgate regulations further defining the confidentiality ofinformation pursuant to this subsection. Nothing in this subsection shall bedeemed to prohibit (i) the issuance of general statements based upon thereports of a number of handlers, which do not identify the informationfurnished by any person, or (ii) the publication by direction of thecommission of the name of any person violating any regulation of thecommission, together with a statement of the particular provisions violated bysuch person.
(c) No officer, employee, or agent of the commission shall intentionallydisclose information, by inference or otherwise, which is made confidentialpursuant to this section. Any person violating the provisions of thissubsection shall, upon conviction, be subject to a fine of not more than onethousand dollars or to imprisonment for not more than one year, or to both,and shall be removed from office. The commission shall refer any allegationof a violation of this subsection to the appropriate state enforcementauthority or United States attorney.
16. Subpoena; hearings and judicial review
(a) The commission is hereby authorized and empowered by its members andits properly designated officers to administer oaths and issue subpoenasthroughout all signatory states to compel the attendance of witnesses and thegiving of testimony and the production of other evidence.
(b) Any handler subject to an order may file a written petition with thecommission stating that any such order or any provision of any such order orany obligation imposed in connection therewith is not in accordance with lawand praying for a modification thereof or to be exempted therefrom. He shallthereupon be given an opportunity for a hearing upon such petition, inaccordance with regulations made by the commission. After such hearing, thecommission shall make a ruling upon the prayer of such petition which shall befinal, if in accordance with law.
(c) The district courts of the United States in any district in whichsuch handler is an inhabitant, or has his principal place of business, arehereby vested with jurisdiction to review such ruling, provided a complaintfor that purpose is filed within thirty days from the date of the entry ofsuch ruling. Service of process in such proceedings may be had upon thecommission by delivering to it a copy of the complaint. If the courtdetermines that such ruling is not in accordance with law, it shall remandsuch proceedings to the commission with directions either (1) to make suchruling as the court shall determine to be in accordance with law, or (2) totake such further proceedings as, in its opinion, the law requires. Thependency of proceedings instituted pursuant to this subdivision shall notimpede, hinder, or delay the commission from obtaining relief pursuant tosubsection seventeen. Any proceedings brought pursuant to subsectionseventeen, except where brought by way of counterclaim in proceedingsinstituted pursuant to this subsection, shall abate whenever a final decreehas been rendered in proceedings between the same parties, and covering thesame subject matter, instituted pursuant to this subsection.
17. Enforcement with respect to handlers
(a) Any violation by a handler of the provisions of regulationsestablishing an over-order price or a commission marketing order, or otherregulations adopted pursuant to this compact shall:
(1) Constitute a violation of the laws of each of the signatory states.Such violation shall render the violator subject to a civil penalty in anamount as may be prescribed by the laws of each of the participating states,recoverable in any state or federal court of competent jurisdiction. Each daysuch violation continues shall constitute a separate violation.
(2) Constitute grounds for the revocation of license or permit to engagein the milk business under the applicable laws of the participating states.
(b) With respect to handlers, the commission shall enforce theprovisions of this compact, regulations establishing an over-order price, acommission marketing order or other regulations adopted hereunder by:
(1) Commencing an action for legal or equitable relief brought in thename of the commission of any state or federal court of competentjurisdiction; or
(2) Referral to the state agency for enforcement by judicial oradministrative remedy with the agreement of the appropriate state agency of aparticipating state.
(c) With respect to handlers, the commission may bring an action forinjunction to enforce the provisions of this compact or the order orregulations adopted thereunder without being compelled to allege or prove thatan adequate remedy of law does not exist.
ARTICLE VII. FINANCE
18. Finance of start-up and regular costs
(a) To provide for its start-up costs, the commission may borrow moneypursuant to its general power under subsection six, paragraph (d), subdivisionfour. In order to finance the costs of administration and enforcement of thiscompact, including payback of start-up costs, the commission is herebyempowered to collect an assessment from each handler who purchases milk fromproducers within the region. If imposed, this assessment shall be collectedon a monthly basis for up to one year from the date the commission convenes,in an amount not to exceed $.015 per hundredweight of milk purchased fromproducers during the period of the assessment. The initial assessment mayapply to the projected purchases of handlers for the two-month periodfollowing the date the commission convenes. In addition, if regulationsestablishing an over-order price or a compact marketing order are adopted,they may include an assessment for the specific purpose of theiradministration. These regulations shall provide for establishment of areserve for the commission's ongoing operating expenses.
(b) The commission shall not pledge the credit of any participatingstate or of the United States. Notes issued by the commission and all otherfinancial obligations incurred by it, shall be its sole responsibility and noparticipating state or the United States shall be liable therefor.
19. Audit and accounts
(a) The commission shall keep accurate accounts of all receipts anddisbursements, which shall be subject to the audit and accounting proceduresestablished under its rules. In addition, all receipts and disbursements offunds handled by the commission shall be audited yearly by a qualified publicaccountant and the report of the audit shall be included in and become part ofthe annual report of the commission.
(b) The accounts of the commission shall be open at any reasonable timefor inspection by duly constituted officers of the participating states and byany persons authorized by the commission.
(c) Nothing contained in this article shall be construed to preventcommission compliance with laws relating to audit or inspection of accounts byor on behalf of any participating state or of the United States.
ARTICLE VIII. ENTRY INTO FORCE;
ADDITIONAL MEMBERS AND WITHDRAWAL
20. Entry into force; additional members
The compact shall enter into force effective when enacted into law by anythree states of the group of states composed of Alabama, Arkansas, Florida,Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, Oklahoma,South Carolina, Tennessee, Texas, Virginia and West Virginia and when theconsent of Congress has been obtained.
21. Withdrawal from compact
Any participating state may withdraw from this compact by enacting astatute repealing the same, but no such withdrawal shall take effect until oneyear after notice in writing of the withdrawal is given to the commission andthe governors of all other participating states. No withdrawal shall affectany liability already incurred by or chargeable to a participating state priorto the time of such withdrawal.
22. Severability
If any part or provision of this compact is adjudged invalid by anycourt, such judgment shall be confined in its operation to the part orprovision directly involved in the controversy in which such judgment shallhave been rendered and shall not affect or impair the validity of theremainder of this compact. In the event Congress consents to this compactsubject to conditions, said conditions shall not impair the validity of thiscompact when said conditions are accepted by three or more compacting states.A compacting state may accept the conditions of Congress by implementation ofthis compact.
Southern dairy compact entered into--effective date--text of compact.
262.700. The Southern Dairy Compact, the full text of which ishereinafter set forth and confirmed by the Missouri legislature, is herebyentered into on behalf of the state of Missouri. The compact shall becomeeffective when enacted into law by at least two other states within thecompact group of states and when the consent of Congress has been obtained.The full text of said compact is as follows:
SOUTHERN DAIRY COMPACT
ARTICLE I. STATEMENT OF PURPOSE, FINDINGS
AND DECLARATION OF POLICY
1. Statement of purpose, findings and declaration of policy
The purpose of this compact is to recognize the interstate character ofthe southern dairy industry and the prerogative of the states under the UnitedStates Constitution to form an interstate commission for the southern region.The mission of the commission is to take such steps as are necessary to assurethe continued viability of dairy farming in the south, and to assure consumersof an adequate, local supply of pure and wholesome milk.
The participating states find and declare that the dairy industry is anessential agricultural activity of the south. Dairy farms, and associatedsuppliers, marketers, processors and retailers are an integral component ofthe region's economy. Their ability to provide a stable, local supply ofpure, wholesome milk is a matter of great importance to the health and welfareof the region.
The participating states further find that dairy farms are essential andthey are an integral part of the region's rural communities. The farmspreserve land for agricultural purposes and provide needed economic stimulifor rural communities.
In establishing their constitutional regulatory authority over theregion's fluid milk market by this compact, the participating states declaretheir purpose that this compact neither displace the federal order system norencourage the merging of federal orders. Specific provisions of the compactitself set forth this basic principle.
Designed as a flexible mechanism able to adjust to changes in a regulatedmarketplace, the compact also contains a contingency provision should thefederal order system be discontinued. In that event, the interstatecommission is authorized to regulate the marketplace in replacement of theorder system. This contingent authority does not anticipate such a change,however, and should not be so construed. It is only provided shoulddevelopments in the market other than establishment of this compact result indiscontinuance of the order system.
By entering into this compact, the participating states affirm that theirability to regulate the price which southern dairy farmers receive for theirproduct is essential to the public interest. Assurance of a fair andequitable price for dairy farmers ensures their ability to provide milk to themarket and the vitality of the southern dairy industry, with all theassociated benefits.
Recent, dramatic price fluctuations, with a pronounced downward trend,threaten the viability and stability of the southern dairy region.Historically, individual state regulatory action had been an effectiveemergency remedy available to farmers confronting a distressed market. Thefederal order system, implemented by the Agricultural Marketing Agreement Actof 1937, establishes only minimum prices paid to producers for raw milk,without preempting the power of states to regulate milk prices above theminimum levels so established.
In today's regional dairy marketplace, cooperative, rather thanindividual state action is needed to more effectively address the marketdisarray. Under our constitutional system, properly authorized states actingcooperatively may exercise more power to regulate interstate commerce thanthey may assert individually without such authority. For this reason, theparticipating states invoke their authority to act in common agreement, withthe consent of Congress, under the compact clause of the Constitution.
ARTICLE II. DEFINITIONS AND RULES OF CONSTRUCTION
2. Definitions
For the purposes of this compact, and of any supplemental or concurringlegislation enacted pursuant thereto, except as may be otherwise required bythe context:
(1) "Class I milk" means milk disposed of in fluid form or as a fluidmilk product, subject to further definition in accordance with the principlesexpressed in paragraph (b) of subsection three.
(2) "Commission" means the southern dairy compact Commission establishedby this compact.
(3) "Commission marketing order" means regulations adopted by thecommission pursuant to sections nine and ten of this compact in place of aterminated federal marketing order or state dairy regulation. Such order mayapply throughout the region or in any part or parts thereof as defined in theregulations of the commission. Such order may establish minimum prices forany or all classes of milk.
(4) "Compact" means this interstate compact.
(5) "Compact over-order price" means a minimum price required to be paidto producers for class I milk established by the commission in regulationsadopted pursuant to subsections nine and ten of this compact, which is abovethe price established in federal marketing orders or by state farm priceregulations in the regulated area. Such price may apply throughout the regionor in any part or parts thereof as defined in the regulations of thecommission.
(6) "Milk" means the lacteral secretion of cows and includes all skim,butterfat, or other constituents obtained from separation or any otherprocess. The term is used in its broadest sense and may be further defined bythe commission for regulatory purposes.
(7) "Partially regulated plant" means a milk plant not located in aregulated area but having class I distribution within such area. Commissionregulations may exempt plants having such distribution or receipts in amountsless than the limits defined therein.
(8) "Participating state" means a state which has become a party to thiscompact by the enactment of concurring legislation.
(9) "Pool plant" means any milk plant located in a regulated area.
(10) "Region" means the territorial limits of the states which areparties to this compact.
(11) "Regulated area" means any area within the region governed by anddefined in regulations establishing a compact over-order price or commissionmarketing order.
(12) "State dairy regulation" means any state regulation of dairyprices, and associated assessments, whether by statute, marketing order orotherwise.
3. Rules of construction
(a) This compact shall not be construed to displace existing federalmilk marketing orders or state dairy regulation in the region but tosupplement them. In the event some or all federal orders in the region arediscontinued, the compact shall be construed to provide the commission theoption to replace them with one or more commission marketing orders pursuantto this compact.
(b) The compact shall be construed liberally in order to achieve thepurposes and intent enunciated in subsection one. It is the intent of thiscompact to establish a basic structure by which the commission may achievethose purposes through the application, adaptation and development of theregulatory techniques historically associated with milk marketing and toafford the commission broad flexibility to devise regulatory mechanisms toachieve the purposes of this compact. In accordance with this intent, thetechnical terms which are associated with market order regulation and whichhave acquired commonly understood general meanings are not defined herein butthe commission may further define the terms used in this compact and developadditional concepts and define additional terms as it may find appropriate toachieve its purposes.
ARTICLE III. COMMISSION ESTABLISHED
4. Commission established
There is hereby created a commission to administer the compact, composedof delegations from each state in the region. The commission shall be knownas the Southern Dairy Compact Commission. A delegation shall include not lessthan three nor more than five persons. Each delegation shall include at leastone dairy farmer who is engaged in the production of milk at the time ofappointment or reappointment, and one consumer representative. Delegationmembers shall be residents and voters of, and subject to such confirmationprocess as is provided for in the appointing state. Delegation members shallserve no more than three consecutive terms with no single term of more thanfour years, and be subject to removal for cause. In all other respects,delegation members shall serve in accordance with the laws of the staterepresented. The compensation, if any, of the members of a state delegationshall be determined and paid by each state, but their expenses shall be paidby the commission.
5. Voting requirements
All actions taken by the commission, except for the establishment ortermination of an over-order price or commission marketing order, and theadoption, amendment or rescission of the commission's by-laws, shall be bymajority vote of the delegations present. Each state delegation shall beentitled to one vote in the conduct of the commission's affairs.Establishment or termination of an over-order price or commission marketingorder shall require at least a two-thirds vote of the delegations present.The establishment of a regulated area which covers all or part of aparticipating state shall require also the affirmative vote of that state'sdelegation. A majority of the delegations from the participating states shallconstitute a quorum for the conduct of the commission's business.
6. Administration and management
(a) The commission shall elect annually from among the members of theparticipating state delegations a chairperson, a vice-chairperson, and atreasurer. The commission shall appoint an executive director and fix his orher duties and compensation. The executive director shall serve at thepleasure of the commission, and together with the treasurer, shall be bondedin an amount determined by the commission. The commission may establishthrough its by-laws an executive committee composed of one member elected byeach delegation.
(b) The commission shall adopt bylaws for the conduct of its business bya two-thirds vote, and shall have the power by the same vote to amend andrescind these by-laws. The commission shall publish its by-laws in convenientform with the appropriate agency or officer in each of the participatingstates. The by-laws shall provide for appropriate notice to the delegationsof all commission meetings and hearings and of the business to be transactedat such meetings or hearings. Notice also shall be given to other agencies orofficers of participating states as provided by the laws of those states.
(c) The commission shall file an annual report with the Secretary ofAgriculture of the United States, and with each of the participating states bysubmitting copies to the governor, both houses of the legislature, and thehead of the state department having responsibilities for agriculture.
(d) In addition to the powers and duties elsewhere prescribed in thiscompact, the commission shall have the power:
(1) To sue and be sued in any state or federal court;
(2) To have a seal and alter the same at pleasure;
(3) To acquire, hold, and dispose of real and personal property by gift,purchase, lease, license, or other similar manner, for its corporate purposes;
(4) To borrow money and issue notes, to provide for the rights of theholders thereof and to pledge the revenue of the commission as securitytherefor, subject to the provisions of subsection eighteen of this compact;
(5) To appoint such officers, agents, and employees as it may deemnecessary, prescribe their powers, duties and qualifications; and
(6) To create and abolish such offices, employments and positions as itdeems necessary for the purposes of the compact and provide for the removal,term, tenure, compensation, fringe benefits, pension, and retirement rights ofits officers and employees. The commission may also retain personal serviceson a contract basis.
7. Rulemaking power
In addition to the power to promulgate a compact over-order price orcommission marketing orders as provided by this compact, the commission isfurther empowered to make and enforce such additional rules and regulations asit deems necessary to implement any provisions of this compact, or toeffectuate in any other respect the purposes of this* compact.
ARTICLE IV. POWERS OF THE COMMISSION
8. Powers to promote regulatory uniformity, simplicity, and interstatecooperation
The commission is hereby empowered to:
(1) Investigate or provide for investigations or research projectsdesigned to review the existing laws and regulations of the participatingstates, to consider their administration and costs, to measure their impact onthe production and marketing of milk and their effects on the shipment of milkand milk products within the region.
(2) Study and recommend to the participating states joint or cooperativeprograms for the administration of the dairy marketing laws and regulationsand to prepare estimates of cost savings and benefits of such programs.
(3) Encourage the harmonious relationships between the various elementsin the industry for the solution of their material problems. Conduct symposiaor conferences designed to improve industry relations, or a betterunderstanding of problems.
(4) Prepare and release periodic reports on activities and results ofthe commission's efforts to the participating states.
(5) Review the existing marketing system for milk and milk products andrecommend changes in the existing structure for assembly and distribution ofmilk which may assist, improve or promote more efficient assembly anddistribution of milk.
(6) Investigate costs and charges for producing, hauling, handling,processing, distributing, selling and for all other services performed withrespect to milk.
(7) Examine current economic forces affecting producers, probable trendsin production and consumption, the level of dairy farm prices in relation tocosts, the financial conditions of dairy farmers, and the need for anemergency order to relieve critical conditions on dairy farms.
9. Equitable farm prices
(a) The powers granted in this subsection and subsection ten shall applyonly to the establishment of a compact over-order price, so long as federalmilk marketing orders remain in effect in the region. In the event that anyor all such orders are terminated, this article shall authorize the commissionto establish one or more commission marketing orders, as herein provided, inthe region or parts thereof as defined in the order.
(b) A compact over-order price established pursuant to this sectionshall apply only to class I milk. Such compact over-order price shall notexceed one dollar and fifty cents per gallon at Atlanta, Ga., however, thiscompact over-order price shall be adjusted upward or downward at otherlocations in the region to reflect differences in minimum federal orderprices. Beginning in 1990, and using that year as a base, the foregoing onedollar fifty cents per gallon maximum shall be adjusted annually by the rateof change in the consumer price index as reported by the Bureau of LaborStatistics of the United States Department of Labor. For purposes of thepooling and equalization of an over-order price, the value of milk used inother use classifications shall be calculated at the appropriate class priceestablished pursuant to the applicable federal order or state dairy regulationand the value of unregulated milk shall be calculated in relation to thenearest prevailing class price in accordance with and subject to suchadjustments as the commission may prescribe in regulations.
(c) A commission marketing order shall apply to all classes and uses ofmilk.
(d) The commission is hereby empowered to establish a compact over-orderprice for milk to be paid by pool plants and partially regulated plants. Thecommission is also empowered to establish a compact over-order price to bepaid by all other handlers receiving milk from producers located in aregulated area. This price shall be established either as a compactover-order price or by one or more commission marketing orders. Whenever sucha price has been established by either type of regulation, the legalobligation to pay such price shall be determined solely by the terms andpurpose of the regulation without regard to the situs of the transfer oftitle, possession or any other factors not related to the purposes of theregulation and this compact. Producer-handlers as defined in an applicablefederal market order shall not be subject to a compact over-order price. Thecommission shall provide for similar treatment of producer-handlers undercommission marketing orders.
(e) In determining the price, the commission shall consider the balancebetween production and consumption of milk and milk products in the regulatedarea, the costs of production including, but not limited to the price of feed,the cost of labor including the reasonable value of the producer's own laborand management, machinery expense, and interest expense, the prevailing pricefor milk outside the regulated area, the purchasing power of the public andthe price necessary to yield a reasonable return to the producer anddistributor.
(f) When establishing a compact over-order price, the commission shalltake such other action as is necessary and feasible to help ensure that theover-order price does not cause or compensate producers so as to generatelocal production of milk in excess of those quantities necessary to assureconsumers of an adequate supply for fluid purposes.
(g) The commission shall whenever possible enter into agreements withstate or federal agencies for exchange of information or services for thepurpose of reducing regulatory burden and cost of administering the compact.The commission may reimburse other agencies for the reasonable cost ofproviding these services.
10. Optional provisions for pricing order
Regulations establishing a compact over-order price or a commissionmarketing order may contain, but shall not be limited to any of the following:
(1) Provisions classifying milk in accordance with the form in which orpurpose for which it is used, or creating a flat pricing program.
(2) With respect to a commission marketing order only, provisionsestablishing or providing a method for establishing separate minimum pricesfor each use classification prescribed by the commission, or a single minimumprice for milk purchased from producers or associations of producers.
(3) With respect to an over-order minimum price, provisions establishingor providing a method for establishing such minimum price for class I milk.
(4) Provisions for establishing either an over-order price or acommission marketing order may make use of any reasonable method forestablishing such price or prices including flat pricing and formula pricing.Provision may also be made for location adjustments, zone differentials andfor competitive credits with respect to regulated handlers who market outsidethe regulated area.
(5) Provisions for the payment to all producers and associations ofproducers delivering milk to all handlers of uniform prices for all milk sodelivered, irrespective of the uses made of such milk by the individualhandler to whom it is delivered, or for the payment of producers deliveringmilk to the same handler of uniform prices for all milk delivered by them.
(A) With respect to regulations establishing a compact over-order price,the commission may establish one equalization pool within the regulated areafor the sole purpose of equalizing returns to producers throughout theregulated area.
(B) With respect to any commission marketing order, as defined insubsection two, subdivision three, which replaces one or more terminatedfederal orders or state dairy regulations, the marketing area of now separatestate or federal orders shall not be merged without the affirmative consent ofeach state, voting through its delegation, which is partly or wholly includedwithin any such new marketing area.
(6) Provisions requiring persons who bring class I milk into theregulated area to make compensatory payments with respect to all such milk tothe extent necessary to equalize the cost of milk purchased by handlerssubject to a compact over-order price or commission marketing order. No suchprovisions shall discriminate against milk producers outside the regulatedarea. The provisions for compensatory payments may require payment of thedifference between the class I price required to be paid for such milk in thestate of production by a federal milk marketing order or state dairyregulation and the class I price established by the compact over-order priceor commission marketing order.
(7) Provisions specially governing the pricing and pooling of milkhandled by partially regulated plants.
(8) Provisions requiring that the account of any person regulated underthe compact over-order price shall be adjusted for any payments made to orreceived by such persons with respect to a producer settlement fund of anyfederal or state milk marketing order or other state dairy regulation withinthe regulated area.
(9) Provision requiring the payment by handlers of an assessment tocover the costs of the administration and enforcement of such order pursuantto article VII, subsection 18(a).
(10) Provisions for reimbursement to participants of the Women, Infantsand Children Special Supplemental Food Program of the United States ChildNutrition Act of 1966.
(11) Other provisions and requirements as the commission may find arenecessary or appropriate to effectuate the purposes of this compact and toprovide for the payment of fair and equitable minimum prices to producers.
ARTICLE V. RULEMAKING PROCEDURE
11. Rulemaking procedure
Before promulgation of any regulations establishing a compact over-orderprice or commission marketing order, including any provision with respect tomilk supply under subsection 9 (f), or amendment thereof, as provided inarticle IV, the commission shall conduct an informal rulemaking proceeding toprovide interested persons with an opportunity to present data and views.Such rulemaking proceeding shall be governed by Section 4 of the FederalAdministrative Procedure Act, as amended (5 U.S.C. § 553). In addition, thecommission shall, to the extent practicable, publish notice of rulemakingproceedings in the official register of each participating state. Before theinitial adoption of regulations establishing a compact over-order price or acommission marketing order and thereafter before any amendment with regard toprices or assessments, the commission shall hold a public hearing. Thecommission may commence a rulemaking proceeding on its own initiative or mayin its sole discretion act upon the petition of any person includingindividual milk producers, any organization of milk producers or handlers,general farm organizations, consumer or public interest groups, and local,state or federal officials.
12. Findings and referendum
(a) In addition to the concise general statement of basis and purposerequired by section 4 (b) of the Federal Administrative Procedure Act, asamended (5 U.S.C. § 553 (c)), the commission shall make findings of fact withrespect to:
(1) Whether the public interest will be served by the establishment ofminimum milk prices to dairy farmers under article IV.
(2) What level of prices will assure that producers receive a pricesufficient to cover their costs of production and will elicit an adequatesupply of milk for the inhabitants of the regulated area and for manufacturingpurposes.
(3) Whether the major provisions of the order, other than those fixingminimum milk prices, are in the public interest and are reasonably designed toachieve the purposes of the order.
(4) Whether the terms of the proposed regional order or amendment areapproved by producers as provided in subsection thirteen.
13. Producer referendum
(a) For the purpose of ascertaining whether the issuance or amendment ofregulations establishing a compact over-order price or a commission marketingorder, including any provision with respect to milk supply under subsection 9(f), is approved by producers, the commission shall conduct a referendum amongproducers. The referendum shall be held in a timely manner, as determined byregulation of the commission. The terms and conditions of the proposed orderor amendment shall be described by the commission in the ballot used in theconduct of the referendum, but the nature, content, or extent of suchdescription shall not be a basis for attacking the legality of the order orany action relating thereto.
(b) An order or amendment shall be deemed approved by producers if thecommission determines that it is approved by at least two-thirds of the votingproducers who, during a representative period determined by the commission,have been engaged in the production of milk the price of which would beregulated under the proposed order or amendment.
(c) For purposes of any referendum, the commission shall consider theapproval or disapproval by any cooperative association of producers, qualifiedunder the provisions of the Act of Congress of February 18, 1922, as amended,known as the Capper-Volstead Act, bona fide engaged in marketing milk, or inrendering services for or advancing the interests of producers of suchcommodity, as the approval or disapproval of the producers who are members orstockholders in, or under contract with, such cooperative association ofproducers, except as provided in subdivision (1) hereof and subject to theprovisions of subdivision (2) through (5) hereof.
(1) No cooperative which has been formed to act as a common marketingagency for both cooperatives and individual producers shall be qualified toblock vote for either.
(2) Any cooperative which is qualified to block vote shall, beforesubmitting its approval or disapproval in any referendum, give prior writtennotice to each of its members as to whether and how it intends to cast itsvote. The notice shall be given in a timely manner as established, and in theform prescribed, by the commission.
(3) Any producer may obtain a ballot from the commission in order toregister approval or disapproval of the proposed order.
(4) A producer who is a member of a cooperative which has providednotice of its intent to approve or not to approve a proposed order, and whoobtains a ballot and with such ballot expresses his approval or disapproval ofthe proposed order, shall notify the commission as to the name of thecooperative of which he or she is a member, and the commission shall removesuch producer's name from the list certified by such cooperative with itscorporate vote.
(5) In order to ensure that all milk producers are informed regardingthe proposed order, the commission shall notify all milk producers that anorder is being considered and that each producer may register his approval ordisapproval with the commission either directly or through his or hercooperative.
14. Termination of over-order price or marketing order
(a) The commission shall terminate any regulations establishing anover-order price or commission marketing order issued under this articlewhenever it finds that such order or price obstructs or does not tend toeffectuate the declared policy of this compact.
(b) The commission shall terminate any regulations establishing anover-order price or a commission marketing order issued under this articlewhenever it finds that such termination is favored by a majority of theproducers who, during a representative period determined by the commission,have been engaged in the production of milk the price of which is regulated bysuch order; but such termination shall be effective only if announced on orbefore such date as may be specified in such marketing agreement or order.
(c) The termination or suspension of any order or provision thereof,shall not be considered an order within the meaning of this article and shallrequire no hearing, but shall comply with the requirements for informalrulemaking prescribed by section four of the Federal Administrative ProcedureAct, as amended (5 U.S.C. § 553).
ARTICLE VI. ENFORCEMENT
15. Records; reports; access to premises
(a) The commission may by rule and regulation prescribe record keepingand reporting requirements for all regulated persons. For purposes of theadministration and enforcement of this compact, the commission is authorizedto examine the books and records of any regulated person relating to his orher milk business and for that purpose, the commission's properly designatedofficers, employees, or agents shall have full access during normal businesshours to the premises and records of all regulated persons.
(b) Information furnished to or acquired by the commission officers,employees, or its agents pursuant to this section shall be confidential andnot subject to disclosure except to the extent that the commission deemsdisclosure to be necessary in any administrative or judicial proceedinginvolving the administration or enforcement of this compact, an over-orderprice, a compact marketing order, or other regulations of the commission. Thecommission may promulgate regulations further defining the confidentiality ofinformation pursuant to this subsection. Nothing in this subsection shall bedeemed to prohibit (i) the issuance of general statements based upon thereports of a number of handlers, which do not identify the informationfurnished by any person, or (ii) the publication by direction of thecommission of the name of any person violating any regulation of thecommission, together with a statement of the particular provisions violated bysuch person.
(c) No officer, employee, or agent of the commission shall intentionallydisclose information, by inference or otherwise, which is made confidentialpursuant to this section. Any person violating the provisions of thissubsection shall, upon conviction, be subject to a fine of not more than onethousand dollars or to imprisonment for not more than one year, or to both,and shall be removed from office. The commission shall refer any allegationof a violation of this subsection to the appropriate state enforcementauthority or United States attorney.
16. Subpoena; hearings and judicial review
(a) The commission is hereby authorized and empowered by its members andits properly designated officers to administer oaths and issue subpoenasthroughout all signatory states to compel the attendance of witnesses and thegiving of testimony and the production of other evidence.
(b) Any handler subject to an order may file a written petition with thecommission stating that any such order or any provision of any such order orany obligation imposed in connection therewith is not in accordance with lawand praying for a modification thereof or to be exempted therefrom. He shallthereupon be given an opportunity for a hearing upon such petition, inaccordance with regulations made by the commission. After such hearing, thecommission shall make a ruling upon the prayer of such petition which shall befinal, if in accordance with law.
(c) The district courts of the United States in any district in whichsuch handler is an inhabitant, or has his principal place of business, arehereby vested with jurisdiction to review such ruling, provided a complaintfor that purpose is filed within thirty days from the date of the entry ofsuch ruling. Service of process in such proceedings may be had upon thecommission by delivering to it a copy of the complaint. If the courtdetermines that such ruling is not in accordance with law, it shall remandsuch proceedings to the commission with directions either (1) to make suchruling as the court shall determine to be in accordance with law, or (2) totake such further proceedings as, in its opinion, the law requires. Thependency of proceedings instituted pursuant to this subdivision shall notimpede, hinder, or delay the commission from obtaining relief pursuant tosubsection seventeen. Any proceedings brought pursuant to subsectionseventeen, except where brought by way of counterclaim in proceedingsinstituted pursuant to this subsection, shall abate whenever a final decreehas been rendered in proceedings between the same parties, and covering thesame subject matter, instituted pursuant to this subsection.
17. Enforcement with respect to handlers
(a) Any violation by a handler of the provisions of regulationsestablishing an over-order price or a commission marketing order, or otherregulations adopted pursuant to this compact shall:
(1) Constitute a violation of the laws of each of the signatory states.Such violation shall render the violator subject to a civil penalty in anamount as may be prescribed by the laws of each of the participating states,recoverable in any state or federal court of competent jurisdiction. Each daysuch violation continues shall constitute a separate violation.
(2) Constitute grounds for the revocation of license or permit to engagein the milk business under the applicable laws of the participating states.
(b) With respect to handlers, the commission shall enforce theprovisions of this compact, regulations establishing an over-order price, acommission marketing order or other regulations adopted hereunder by:
(1) Commencing an action for legal or equitable relief brought in thename of the commission of any state or federal court of competentjurisdiction; or
(2) Referral to the state agency for enforcement by judicial oradministrative remedy with the agreement of the appropriate state agency of aparticipating state.
(c) With respect to handlers, the commission may bring an action forinjunction to enforce the provisions of this compact or the order orregulations adopted thereunder without being compelled to allege or prove thatan adequate remedy of law does not exist.
ARTICLE VII. FINANCE
18. Finance of start-up and regular costs
(a) To provide for its start-up costs, the commission may borrow moneypursuant to its general power under subsection six, paragraph (d), subdivisionfour. In order to finance the costs of administration and enforcement of thiscompact, including payback of start-up costs, the commission is herebyempowered to collect an assessment from each handler who purchases milk fromproducers within the region. If imposed, this assessment shall be collectedon a monthly basis for up to one year from the date the commission convenes,in an amount not to exceed $.015 per hundredweight of milk purchased fromproducers during the period of the assessment. The initial assessment mayapply to the projected purchases of handlers for the two-month periodfollowing the date the commission convenes. In addition, if regulationsestablishing an over-order price or a compact marketing order are adopted,they may include an assessment for the specific purpose of theiradministration. These regulations shall provide for establishment of areserve for the commission's ongoing operating expenses.
(b) The commission shall not pledge the credit of any participatingstate or of the United States. Notes issued by the commission and all otherfinancial obligations incurred by it, shall be its sole responsibility and noparticipating state or the United States shall be liable therefor.
19. Audit and accounts
(a) The commission shall keep accurate accounts of all receipts anddisbursements, which shall be subject to the audit and accounting proceduresestablished under its rules. In addition, all receipts and disbursements offunds handled by the commission shall be audited yearly by a qualified publicaccountant and the report of the audit shall be included in and become part ofthe annual report of the commission.
(b) The accounts of the commission shall be open at any reasonable timefor inspection by duly constituted officers of the participating states and byany persons authorized by the commission.
(c) Nothing contained in this article shall be construed to preventcommission compliance with laws relating to audit or inspection of accounts byor on behalf of any participating state or of the United States.
ARTICLE VIII. ENTRY INTO FORCE;
ADDITIONAL MEMBERS AND WITHDRAWAL
20. Entry into force; additional members
The compact shall enter into force effective when enacted into law by anythree states of the group of states composed of Alabama, Arkansas, Florida,Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, Oklahoma,South Carolina, Tennessee, Texas, Virginia and West Virginia and when theconsent of Congress has been obtained.
21. Withdrawal from compact
Any participating state may withdraw from this compact by enacting astatute repealing the same, but no such withdrawal shall take effect until oneyear after notice in writing of the withdrawal is given to the commission andthe governors of all other participating states. No withdrawal shall affectany liability already incurred by or chargeable to a participating state priorto the time of such withdrawal.
22. Severability
If any part or provision of this compact is adjudged invalid by anycourt, such judgment shall be confined in its operation to the part orprovision directly involved in the controversy in which such judgment shallhave been rendered and shall not affect or impair the validity of theremainder of this compact. In the event Congress consents to this compactsubject to conditions, said conditions shall not impair the validity of thiscompact when said conditions are accepted by three or more compacting states.A compacting state may accept the conditions of Congress by implementation ofthis compact.
Southern dairy compact entered into--effective date--text of compact.
262.700. The Southern Dairy Compact, the full text of which ishereinafter set forth and confirmed by the Missouri legislature, is herebyentered into on behalf of the state of Missouri. The compact shall becomeeffective when enacted into law by at least two other states within thecompact group of states and when the consent of Congress has been obtained.The full text of said compact is as follows:
SOUTHERN DAIRY COMPACT
ARTICLE I. STATEMENT OF PURPOSE, FINDINGS
AND DECLARATION OF POLICY
1. Statement of purpose, findings and declaration of policy
The purpose of this compact is to recognize the interstate character ofthe southern dairy industry and the prerogative of the states under the UnitedStates Constitution to form an interstate commission for the southern region.The mission of the commission is to take such steps as are necessary to assurethe continued viability of dairy farming in the south, and to assure consumersof an adequate, local supply of pure and wholesome milk.
The participating states find and declare that the dairy industry is anessential agricultural activity of the south. Dairy farms, and associatedsuppliers, marketers, processors and retailers are an integral component ofthe region's economy. Their ability to provide a stable, local supply ofpure, wholesome milk is a matter of great importance to the health and welfareof the region.
The participating states further find that dairy farms are essential andthey are an integral part of the region's rural communities. The farmspreserve land for agricultural purposes and provide needed economic stimulifor rural communities.
In establishing their constitutional regulatory authority over theregion's fluid milk market by this compact, the participating states declaretheir purpose that this compact neither displace the federal order system norencourage the merging of federal orders. Specific provisions of the compactitself set forth this basic principle.
Designed as a flexible mechanism able to adjust to changes in a regulatedmarketplace, the compact also contains a contingency provision should thefederal order system be discontinued. In that event, the interstatecommission is authorized to regulate the marketplace in replacement of theorder system. This contingent authority does not anticipate such a change,however, and should not be so construed. It is only provided shoulddevelopments in the market other than establishment of this compact result indiscontinuance of the order system.
By entering into this compact, the participating states affirm that theirability to regulate the price which southern dairy farmers receive for theirproduct is essential to the public interest. Assurance of a fair andequitable price for dairy farmers ensures their ability to provide milk to themarket and the vitality of the southern dairy industry, with all theassociated benefits.
Recent, dramatic price fluctuations, with a pronounced downward trend,threaten the viability and stability of the southern dairy region.Historically, individual state regulatory action had been an effectiveemergency remedy available to farmers confronting a distressed market. Thefederal order system, implemented by the Agricultural Marketing Agreement Actof 1937, establishes only minimum prices paid to producers for raw milk,without preempting the power of states to regulate milk prices above theminimum levels so established.
In today's regional dairy marketplace, cooperative, rather thanindividual state action is needed to more effectively address the marketdisarray. Under our constitutional system, properly authorized states actingcooperatively may exercise more power to regulate interstate commerce thanthey may assert individually without such authority. For this reason, theparticipating states invoke their authority to act in common agreement, withthe consent of Congress, under the compact clause of the Constitution.
ARTICLE II. DEFINITIONS AND RULES OF CONSTRUCTION
2. Definitions
For the purposes of this compact, and of any supplemental or concurringlegislation enacted pursuant thereto, except as may be otherwise required bythe context:
(1) "Class I milk" means milk disposed of in fluid form or as a fluidmilk product, subject to further definition in accordance with the principlesexpressed in paragraph (b) of subsection three.
(2) "Commission" means the southern dairy compact Commission establishedby this compact.
(3) "Commission marketing order" means regulations adopted by thecommission pursuant to sections nine and ten of this compact in place of aterminated federal marketing order or state dairy regulation. Such order mayapply throughout the region or in any part or parts thereof as defined in theregulations of the commission. Such order may establish minimum prices forany or all classes of milk.
(4) "Compact" means this interstate compact.
(5) "Compact over-order price" means a minimum price required to be paidto producers for class I milk established by the commission in regulationsadopted pursuant to subsections nine and ten of this compact, which is abovethe price established in federal marketing orders or by state farm priceregulations in the regulated area. Such price may apply throughout the regionor in any part or parts thereof as defined in the regulations of thecommission.
(6) "Milk" means the lacteral secretion of cows and includes all skim,butterfat, or other constituents obtained from separation or any otherprocess. The term is used in its broadest sense and may be further defined bythe commission for regulatory purposes.
(7) "Partially regulated plant" means a milk plant not located in aregulated area but having class I distribution within such area. Commissionregulations may exempt plants having such distribution or receipts in amountsless than the limits defined therein.
(8) "Participating state" means a state which has become a party to thiscompact by the enactment of concurring legislation.
(9) "Pool plant" means any milk plant located in a regulated area.
(10) "Region" means the territorial limits of the states which areparties to this compact.
(11) "Regulated area" means any area within the region governed by anddefined in regulations establishing a compact over-order price or commissionmarketing order.
(12) "State dairy regulation" means any state regulation of dairyprices, and associated assessments, whether by statute, marketing order orotherwise.
3. Rules of construction
(a) This compact shall not be construed to displace existing federalmilk marketing orders or state dairy regulation in the region but tosupplement them. In the event some or all federal orders in the region arediscontinued, the compact shall be construed to provide the commission theoption to replace them with one or more commission marketing orders pursuantto this compact.
(b) The compact shall be construed liberally in order to achieve thepurposes and intent enunciated in subsection one. It is the intent of thiscompact to establish a basic structure by which the commission may achievethose purposes through the application, adaptation and development of theregulatory techniques historically associated with milk marketing and toafford the commission broad flexibility to devise regulatory mechanisms toachieve the purposes of this compact. In accordance with this intent, thetechnical terms which are associated with market order regulation and whichhave acquired commonly understood general meanings are not defined herein butthe commission may further define the terms used in this compact and developadditional concepts and define additional terms as it may find appropriate toachieve its purposes.
ARTICLE III. COMMISSION ESTABLISHED
4. Commission established
There is hereby created a commission to administer the compact, composedof delegations from each state in the region. The commission shall be knownas the Southern Dairy Compact Commission. A delegation shall include not lessthan three nor more than five persons. Each delegation shall include at leastone dairy farmer who is engaged in the production of milk at the time ofappointment or reappointment, and one consumer representative. Delegationmembers shall be residents and voters of, and subject to such confirmationprocess as is provided for in the appointing state. Delegation members shallserve no more than three consecutive terms with no single term of more thanfour years, and be subject to removal for cause. In all other respects,delegation members shall serve in accordance with the laws of the staterepresented. The compensation, if any, of the members of a state delegationshall be determined and paid by each state, but their expenses shall be paidby the commission.
5. Voting requirements
All actions taken by the commission, except for the establishment ortermination of an over-order price or commission marketing order, and theadoption, amendment or rescission of the commission's by-laws, shall be bymajority vote of the delegations present. Each state delegation shall beentitled to one vote in the conduct of the commission's affairs.Establishment or termination of an over-order price or commission marketingorder shall require at least a two-thirds vote of the delegations present.The establishment of a regulated area which covers all or part of aparticipating state shall require also the affirmative vote of that state'sdelegation. A majority of the delegations from the participating states shallconstitute a quorum for the conduct of the commission's business.
6. Administration and management
(a) The commission shall elect annually from among the members of theparticipating state delegations a chairperson, a vice-chairperson, and atreasurer. The commission shall appoint an executive director and fix his orher duties and compensation. The executive director shall serve at thepleasure of the commission, and together with the treasurer, shall be bondedin an amount determined by the commission. The commission may establishthrough its by-laws an executive committee composed of one member elected byeach delegation.
(b) The commission shall adopt bylaws for the conduct of its business bya two-thirds vote, and shall have the power by the same vote to amend andrescind these by-laws. The commission shall publish its by-laws in convenientform with the appropriate agency or officer in each of the participatingstates. The by-laws shall provide for appropriate notice to the delegationsof all commission meetings and hearings and of the business to be transactedat such meetings or hearings. Notice also shall be given to other agencies orofficers of participating states as provided by the laws of those states.
(c) The commission shall file an annual report with the Secretary ofAgriculture of the United States, and with each of the participating states bysubmitting copies to the governor, both houses of the legislature, and thehead of the state department having responsibilities for agriculture.
(d) In addition to the powers and duties elsewhere prescribed in thiscompact, the commission shall have the power:
(1) To sue and be sued in any state or federal court;
(2) To have a seal and alter the same at pleasure;
(3) To acquire, hold, and dispose of real and personal property by gift,purchase, lease, license, or other similar manner, for its corporate purposes;
(4) To borrow money and issue notes, to provide for the rights of theholders thereof and to pledge the revenue of the commission as securitytherefor, subject to the provisions of subsection eighteen of this compact;
(5) To appoint such officers, agents, and employees as it may deemnecessary, prescribe their powers, duties and qualifications; and
(6) To create and abolish such offices, employments and positions as itdeems necessary for the purposes of the compact and provide for the removal,term, tenure, compensation, fringe benefits, pension, and retirement rights ofits officers and employees. The commission may also retain personal serviceson a contract basis.
7. Rulemaking power
In addition to the power to promulgate a compact over-order price orcommission marketing orders as provided by this compact, the commission isfurther empowered to make and enforce such additional rules and regulations asit deems necessary to implement any provisions of this compact, or toeffectuate in any other respect the purposes of this* compact.
ARTICLE IV. POWERS OF THE COMMISSION
8. Powers to promote regulatory uniformity, simplicity, and interstatecooperation
The commission is hereby empowered to:
(1) Investigate or provide for investigations or research projectsdesigned to review the existing laws and regulations of the participatingstates, to consider their administration and costs, to measure their impact onthe production and marketing of milk and their effects on the shipment of milkand milk products within the region.
(2) Study and recommend to the participating states joint or cooperativeprograms for the administration of the dairy marketing laws and regulationsand to prepare estimates of cost savings and benefits of such programs.
(3) Encourage the harmonious relationships between the various elementsin the industry for the solution of their material problems. Conduct symposiaor conferences designed to improve industry relations, or a betterunderstanding of problems.
(4) Prepare and release periodic reports on activities and results ofthe commission's efforts to the participating states.
(5) Review the existing marketing system for milk and milk products andrecommend changes in the existing structure for assembly and distribution ofmilk which may assist, improve or promote more efficient assembly anddistribution of milk.
(6) Investigate costs and charges for producing, hauling, handling,processing, distributing, selling and for all other services performed withrespect to milk.
(7) Examine current economic forces affecting producers, probable trendsin production and consumption, the level of dairy farm prices in relation tocosts, the financial conditions of dairy farmers, and the need for anemergency order to relieve critical conditions on dairy farms.
9. Equitable farm prices
(a) The powers granted in this subsection and subsection ten shall applyonly to the establishment of a compact over-order price, so long as federalmilk marketing orders remain in effect in the region. In the event that anyor all such orders are terminated, this article shall authorize the commissionto establish one or more commission marketing orders, as herein provided, inthe region or parts thereof as defined in the order.
(b) A compact over-order price established pursuant to this sectionshall apply only to class I milk. Such compact over-order price shall notexceed one dollar and fifty cents per gallon at Atlanta, Ga., however, thiscompact over-order price shall be adjusted upward or downward at otherlocations in the region to reflect differences in minimum federal orderprices. Beginning in 1990, and using that year as a base, the foregoing onedollar fifty cents per gallon maximum shall be adjusted annually by the rateof change in the consumer price index as reported by the Bureau of LaborStatistics of the United States Department of Labor. For purposes of thepooling and equalization of an over-order price, the value of milk used inother use classifications shall be calculated at the appropriate class priceestablished pursuant to the applicable federal order or state dairy regulationand the value of unregulated milk shall be calculated in relation to thenearest prevailing class price in accordance with and subject to suchadjustments as the commission may prescribe in regulations.
(c) A commission marketing order shall apply to all classes and uses ofmilk.
(d) The commission is hereby empowered to establish a compact over-orderprice for milk to be paid by pool plants and partially regulated plants. Thecommission is also empowered to establish a compact over-order price to bepaid by all other handlers receiving milk from producers located in aregulated area. This price shall be established either as a compactover-order price or by one or more commission marketing orders. Whenever sucha price has been established by either type of regulation, the legalobligation to pay such price shall be determined solely by the terms andpurpose of the regulation without regard to the situs of the transfer oftitle, possession or any other factors not related to the purposes of theregulation and this compact. Producer-handlers as defined in an applicablefederal market order shall not be subject to a compact over-order price. Thecommission shall provide for similar treatment of producer-handlers undercommission marketing orders.
(e) In determining the price, the commission shall consider the balancebetween production and consumption of milk and milk products in the regulatedarea, the costs of production including, but not limited to the price of feed,the cost of labor including the reasonable value of the producer's own laborand management, machinery expense, and interest expense, the prevailing pricefor milk outside the regulated area, the purchasing power of the public andthe price necessary to yield a reasonable return to the producer anddistributor.
(f) When establishing a compact over-order price, the commission shalltake such other action as is necessary and feasible to help ensure that theover-order price does not cause or compensate producers so as to generatelocal production of milk in excess of those quantities necessary to assureconsumers of an adequate supply for fluid purposes.
(g) The commission shall whenever possible enter into agreements withstate or federal agencies for exchange of information or services for thepurpose of reducing regulatory burden and cost of administering the compact.The commission may reimburse other agencies for the reasonable cost ofproviding these services.
10. Optional provisions for pricing order
Regulations establishing a compact over-order price or a commissionmarketing order may contain, but shall not be limited to any of the following:
(1) Provisions classifying milk in accordance with the form in which orpurpose for which it is used, or creating a flat pricing program.
(2) With respect to a commission marketing order only, provisionsestablishing or providing a method for establishing separate minimum pricesfor each use classification prescribed by the commission, or a single minimumprice for milk purchased from producers or associations of producers.
(3) With respect to an over-order minimum price, provisions establishingor providing a method for establishing such minimum price for class I milk.
(4) Provisions for establishing either an over-order price or acommission marketing order may make use of any reasonable method forestablishing such price or prices including flat pricing and formula pricing.Provision may also be made for location adjustments, zone differentials andfor competitive credits with respect to regulated handlers who market outsidethe regulated area.
(5) Provisions for the payment to all producers and associations ofproducers delivering milk to all handlers of uniform prices for all milk sodelivered, irrespective of the uses made of such milk by the individualhandler to whom it is delivered, or for the payment of producers deliveringmilk to the same handler of uniform prices for all milk delivered by them.
(A) With respect to regulations establishing a compact over-order price,the commission may establish one equalization pool within the regulated areafor the sole purpose of equalizing returns to producers throughout theregulated area.
(B) With respect to any commission marketing order, as defined insubsection two, subdivision three, which replaces one or more terminatedfederal orders or state dairy regulations, the marketing area of now separatestate or federal orders shall not be merged without the affirmative consent ofeach state, voting through its delegation, which is partly or wholly includedwithin any such new marketing area.
(6) Provisions requiring persons who bring class I milk into theregulated area to make compensatory payments with respect to all such milk tothe extent necessary to equalize the cost of milk purchased by handlerssubject to a compact over-order price or commission marketing order. No suchprovisions shall discriminate against milk producers outside the regulatedarea. The provisions for compensatory payments may require payment of thedifference between the class I price required to be paid for such milk in thestate of production by a federal milk marketing order or state dairyregulation and the class I price established by the compact over-order priceor commission marketing order.
(7) Provisions specially governing the pricing and pooling of milkhandled by partially regulated plants.
(8) Provisions requiring that the account of any person regulated underthe compact over-order price shall be adjusted for any payments made to orreceived by such persons with respect to a producer settlement fund of anyfederal or state milk marketing order or other state dairy regulation withinthe regulated area.
(9) Provision requiring the payment by handlers of an assessment tocover the costs of the administration and enforcement of such order pursuantto article VII, subsection 18(a).
(10) Provisions for reimbursement to participants of the Women, Infantsand Children Special Supplemental Food Program of the United States ChildNutrition Act of 1966.
(11) Other provisions and requirements as the commission may find arenecessary or appropriate to effectuate the purposes of this compact and toprovide for the payment of fair and equitable minimum prices to producers.
ARTICLE V. RULEMAKING PROCEDURE
11. Rulemaking procedure
Before promulgation of any regulations establishing a compact over-orderprice or commission marketing order, including any provision with respect tomilk supply under subsection 9 (f), or amendment thereof, as provided inarticle IV, the commission shall conduct an informal rulemaking proceeding toprovide interested persons with an opportunity to present data and views.Such rulemaking proceeding shall be governed by Section 4 of the FederalAdministrative Procedure Act, as amended (5 U.S.C. § 553). In addition, thecommission shall, to the extent practicable, publish notice of rulemakingproceedings in the official register of each participating state. Before theinitial adoption of regulations establishing a compact over-order price or acommission marketing order and thereafter before any amendment with regard toprices or assessments, the commission shall hold a public hearing. Thecommission may commence a rulemaking proceeding on its own initiative or mayin its sole discretion act upon the petition of any person includingindividual milk producers, any organization of milk producers or handlers,general farm organizations, consumer or public interest groups, and local,state or federal officials.
12. Findings and referendum
(a) In addition to the concise general statement of basis and purposerequired by section 4 (b) of the Federal Administrative Procedure Act, asamended (5 U.S.C. § 553 (c)), the commission shall make findings of fact withrespect to:
(1) Whether the public interest will be served by the establishment ofminimum milk prices to dairy farmers under article IV.
(2) What level of prices will assure that producers receive a pricesufficient to cover their costs of production and will elicit an adequatesupply of milk for the inhabitants of the regulated area and for manufacturingpurposes.
(3) Whether the major provisions of the order, other than those fixingminimum milk prices, are in the public interest and are reasonably designed toachieve the purposes of the order.
(4) Whether the terms of the proposed regional order or amendment areapproved by producers as provided in subsection thirteen.
13. Producer referendum
(a) For the purpose of ascertaining whether the issuance or amendment ofregulations establishing a compact over-order price or a commission marketingorder, including any provision with respect to milk supply under subsection 9(f), is approved by producers, the commission shall conduct a referendum amongproducers. The referendum shall be held in a timely manner, as determined byregulation of the commission. The terms and conditions of the proposed orderor amendment shall be described by the commission in the ballot used in theconduct of the referendum, but the nature, content, or extent of suchdescription shall not be a basis for attacking the legality of the order orany action relating thereto.
(b) An order or amendment shall be deemed approved by producers if thecommission determines that it is approved by at least two-thirds of the votingproducers who, during a representative period determined by the commission,have been engaged in the production of milk the price of which would beregulated under the proposed order or amendment.
(c) For purposes of any referendum, the commission shall consider theapproval or disapproval by any cooperative association of producers, qualifiedunder the provisions of the Act of Congress of February 18, 1922, as amended,known as the Capper-Volstead Act, bona fide engaged in marketing milk, or inrendering services for or advancing the interests of producers of suchcommodity, as the approval or disapproval of the producers who are members orstockholders in, or under contract with, such cooperative association ofproducers, except as provided in subdivision (1) hereof and subject to theprovisions of subdivision (2) through (5) hereof.
(1) No cooperative which has been formed to act as a common marketingagency for both cooperatives and individual producers shall be qualified toblock vote for either.
(2) Any cooperative which is qualified to block vote shall, beforesubmitting its approval or disapproval in any referendum, give prior writtennotice to each of its members as to whether and how it intends to cast itsvote. The notice shall be given in a timely manner as established, and in theform prescribed, by the commission.
(3) Any producer may obtain a ballot from the commission in order toregister approval or disapproval of the proposed order.
(4) A producer who is a member of a cooperative which has providednotice of its intent to approve or not to approve a proposed order, and whoobtains a ballot and with such ballot expresses his approval or disapproval ofthe proposed order, shall notify the commission as to the name of thecooperative of which he or she is a member, and the commission shall removesuch producer's name from the list certified by such cooperative with itscorporate vote.
(5) In order to ensure that all milk producers are informed regardingthe proposed order, the commission shall notify all milk producers that anorder is being considered and that each producer may register his approval ordisapproval with the commission either directly or through his or hercooperative.
14. Termination of over-order price or marketing order
(a) The commission shall terminate any regulations establishing anover-order price or commission marketing order issued under this articlewhenever it finds that such order or price obstructs or does not tend toeffectuate the declared policy of this compact.
(b) The commission shall terminate any regulations establishing anover-order price or a commission marketing order issued under this articlewhenever it finds that such termination is favored by a majority of theproducers who, during a representative period determined by the commission,have been engaged in the production of milk the price of which is regulated bysuch order; but such termination shall be effective only if announced on orbefore such date as may be specified in such marketing agreement or order.
(c) The termination or suspension of any order or provision thereof,shall not be considered an order within the meaning of this article and shallrequire no hearing, but shall comply with the requirements for informalrulemaking prescribed by section four of the Federal Administrative ProcedureAct, as amended (5 U.S.C. § 553).
ARTICLE VI. ENFORCEMENT
15. Records; reports; access to premises
(a) The commission may by rule and regulation prescribe record keepingand reporting requirements for all regulated persons. For purposes of theadministration and enforcement of this compact, the commission is authorizedto examine the books and records of any regulated person relating to his orher milk business and for that purpose, the commission's properly designatedofficers, employees, or agents shall have full access during normal businesshours to the premises and records of all regulated persons.
(b) Information furnished to or acquired by the commission officers,employees, or its agents pursuant to this section shall be confidential andnot subject to disclosure except to the extent that the commission deemsdisclosure to be necessary in any administrative or judicial proceedinginvolving the administration or enforcement of this compact, an over-orderprice, a compact marketing order, or other regulations of the commission. Thecommission may promulgate regulations further defining the confidentiality ofinformation pursuant to this subsection. Nothing in this subsection shall bedeemed to prohibit (i) the issuance of general statements based upon thereports of a number of handlers, which do not identify the informationfurnished by any person, or (ii) the publication by direction of thecommission of the name of any person violating any regulation of thecommission, together with a statement of the particular provisions violated bysuch person.
(c) No officer, employee, or agent of the commission shall intentionallydisclose information, by inference or otherwise, which is made confidentialpursuant to this section. Any person violating the provisions of thissubsection shall, upon conviction, be subject to a fine of not more than onethousand dollars or to imprisonment for not more than one year, or to both,and shall be removed from office. The commission shall refer any allegationof a violation of this subsection to the appropriate state enforcementauthority or United States attorney.
16. Subpoena; hearings and judicial review
(a) The commission is hereby authorized and empowered by its members andits properly designated officers to administer oaths and issue subpoenasthroughout all signatory states to compel the attendance of witnesses and thegiving of testimony and the production of other evidence.
(b) Any handler subject to an order may file a written petition with thecommission stating that any such order or any provision of any such order orany obligation imposed in connection therewith is not in accordance with lawand praying for a modification thereof or to be exempted therefrom. He shallthereupon be given an opportunity for a hearing upon such petition, inaccordance with regulations made by the commission. After such hearing, thecommission shall make a ruling upon the prayer of such petition which shall befinal, if in accordance with law.
(c) The district courts of the United States in any district in whichsuch handler is an inhabitant, or has his principal place of business, arehereby vested with jurisdiction to review such ruling, provided a complaintfor that purpose is filed within thirty days from the date of the entry ofsuch ruling. Service of process in such proceedings may be had upon thecommission by delivering to it a copy of the complaint. If the courtdetermines that such ruling is not in accordance with law, it shall remandsuch proceedings to the commission with directions either (1) to make suchruling as the court shall determine to be in accordance with law, or (2) totake such further proceedings as, in its opinion, the law requires. Thependency of proceedings instituted pursuant to this subdivision shall notimpede, hinder, or delay the commission from obtaining relief pursuant tosubsection seventeen. Any proceedings brought pursuant to subsectionseventeen, except where brought by way of counterclaim in proceedingsinstituted pursuant to this subsection, shall abate whenever a final decreehas been rendered in proceedings between the same parties, and covering thesame subject matter, instituted pursuant to this subsection.
17. Enforcement with respect to handlers
(a) Any violation by a handler of the provisions of regulationsestablishing an over-order price or a commission marketing order, or otherregulations adopted pursuant to this compact shall:
(1) Constitute a violation of the laws of each of the signatory states.Such violation shall render the violator subject to a civil penalty in anamount as may be prescribed by the laws of each of the participating states,recoverable in any state or federal court of competent jurisdiction. Each daysuch violation continues shall constitute a separate violation.
(2) Constitute grounds for the revocation of license or permit to engagein the milk business under the applicable laws of the participating states.
(b) With respect to handlers, the commission shall enforce theprovisions of this compact, regulations establishing an over-order price, acommission marketing order or other regulations adopted hereunder by:
(1) Commencing an action for legal or equitable relief brought in thename of the commission of any state or federal court of competentjurisdiction; or
(2) Referral to the state agency for enforcement by judicial oradministrative remedy with the agreement of the appropriate state agency of aparticipating state.
(c) With respect to handlers, the commission may bring an action forinjunction to enforce the provisions of this compact or the order orregulations adopted thereunder without being compelled to allege or prove thatan adequate remedy of law does not exist.
ARTICLE VII. FINANCE
18. Finance of start-up and regular costs
(a) To provide for its start-up costs, the commission may borrow moneypursuant to its general power under subsection six, paragraph (d), subdivisionfour. In order to finance the costs of administration and enforcement of thiscompact, including payback of start-up costs, the commission is herebyempowered to collect an assessment from each handler who purchases milk fromproducers within the region. If imposed, this assessment shall be collectedon a monthly basis for up to one year from the date the commission convenes,in an amount not to exceed $.015 per hundredweight of milk purchased fromproducers during the period of the assessment. The initial assessment mayapply to the projected purchases of handlers for the two-month periodfollowing the date the commission convenes. In addition, if regulationsestablishing an over-order price or a compact marketing order are adopted,they may include an assessment for the specific purpose of theiradministration. These regulations shall provide for establishment of areserve for the commission's ongoing operating expenses.
(b) The commission shall not pledge the credit of any participatingstate or of the United States. Notes issued by the commission and all otherfinancial obligations incurred by it, shall be its sole responsibility and noparticipating state or the United States shall be liable therefor.
19. Audit and accounts
(a) The commission shall keep accurate accounts of all receipts anddisbursements, which shall be subject to the audit and accounting proceduresestablished under its rules. In addition, all receipts and disbursements offunds handled by the commission shall be audited yearly by a qualified publicaccountant and the report of the audit shall be included in and become part ofthe annual report of the commission.
(b) The accounts of the commission shall be open at any reasonable timefor inspection by duly constituted officers of the participating states and byany persons authorized by the commission.
(c) Nothing contained in this article shall be construed to preventcommission compliance with laws relating to audit or inspection of accounts byor on behalf of any participating state or of the United States.
ARTICLE VIII. ENTRY INTO FORCE;
ADDITIONAL MEMBERS AND WITHDRAWAL
20. Entry into force; additional members
The compact shall enter into force effective when enacted into law by anythree states of the group of states composed of Alabama, Arkansas, Florida,Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, Oklahoma,South Carolina, Tennessee, Texas, Virginia and West Virginia and when theconsent of Congress has been obtained.
21. Withdrawal from compact
Any participating state may withdraw from this compact by enacting astatute repealing the same, but no such withdrawal shall take effect until oneyear after notice in writing of the withdrawal is given to the commission andthe governors of all other participating states. No withdrawal shall affectany liability already incurred by or chargeable to a participating state priorto the time of such withdrawal.
22. Severability
If any part or provision of this compact is adjudged invalid by anycourt, such judgment shall be confined in its operation to the part orprovision directly involved in the controversy in which such judgment shallhave been rendered and shall not affect or impair the validity of theremainder of this compact. In the event Congress consents to this compactsubject to conditions, said conditions shall not impair the validity of thiscompact when said conditions are accepted by three or more compacting states.A compacting state may accept the conditions of Congress by implementation ofthis compact.
