§ 2-24-1 Ratification of compact –Text. – The governor having entered on behalf of this state into a compact,substantially in the following form, with one or more of the states ofConnecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, NewJersey, New York, Pennsylvania, Vermont and Virginia and with any other statesof the United States or provinces of the Dominion of Canada as may have legallyjoined in this compact, the legislature signifies its approval and ratificationof the compact entered into, as to any of those states or provinces that mayhave or may hereafter legally join in the compact:
ARTICLE I
STATEMENT OF PURPOSE, FINDINGS AND DECLARATION OFPOLICY
Section 1. Statement of purpose, findings and declaration ofpolicy. The purpose of this compact is to recognize by constitutionalprerequisite the interstate character of the northeast dairy industry and toform an interstate commission for the northeast region. The mission of thecommission is to take such steps as are necessary to assure the continuedviability of dairy farming in the northeast, and to assure consumers of anadequate, local supply of pure and wholesome milk.
In today's regional dairy marketplace, cooperative, ratherthan individual state action may address more effectively the market disarray.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.
In establishing their constitutional regulatory authorityover the region's fluid milk market by this compact, the participating statesdeclare their purpose that this compact neither displace the federal ordersystem nor encourage the merging of federal orders. Specific provisions of thecompact itself set forth this basic principle.
Designed as a flexible mechanism able to adjust to changes ina regulated marketplace, the compact also contains a contingency provisionshould the federal 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.
Recent, dramatic price fluctuations, with a pronounceddownward trend, threaten the viability and stability of the northeast dairyregion. Historically, individual state regulatory action has been an effectiveemergency remedy available to farmers confronting a distressed market. Thefederal order system, implemented by the Agricultural Marketing Agreement Actof 1937 [7 U.S.C. § 601 et seq.], establishes only minimumprices for dairy products, without preempting the power of states to regulatemilk prices above the minimum levels so established. Based on this authority,each state in the region has individually attempted to implement at least oneregulatory program in response to the current dairy industry crisis.
The participating states find and declare that the dairyindustry is the paramount agricultural activity of the northeast. Dairy farms,and associated suppliers, marketers, processors and retailers, are an integralcomponent of the region's economy. Their ability to provide a stable, localsupply of pure, wholesome milk is a matter of great importance to the healthand welfare of the region.
The participating states further find that dairy farms areessential to the region's rural communities and character. The farms preserveopen spaces, sculpt the landscape and provide the land base for a diversity ofrecreational pursuits. In defining the rural character of our communities andlandscape, dairy farms also provide a major draw for our tourist industries.
By entering into this compact, the participating statesaffirm that their ability to regulate the price which northeast dairy farmersreceive for their product is essential to the public interest. Assurance of afair and equitable price for dairy farmers ensures their ability to providemilk to the market and the vitality of the northeast dairy industry, with allthe associated benefits.
ARTICLE II
DEFINITIONS AND RULES OF CONSTRUCTION
Section 2. Definitions. For the purpose of this compact, andof any supplemental or concurring legislation enacted pursuant thereto, exceptas may be otherwise required by the context:
(1) "Commission" means the commission established by thiscompact.
(2) "Compact" means this interstate compact.
(3) "Region" means the territorial limits of the states whichare or become parties to this compact.
(4) "Participating state" means a state which has become aparty to this compact by the enactment of concurring legislation.
(5) "Regulated area" means any area within the regiongoverned by and defined in regulations establishing a compact over-order priceor commission marketing order.
(6) "Pool plant" means any milk plant located in a regulatedarea.
(7) "Partially regulated plant" means a milk plant notlocated in a regulated area but having Class I distribution within such area,or receipts from producers located in such area. Commission regulations mayexempt plants having such distribution or receipts in amounts less than thelimits defined therein.
(8) "Compact over-order price" means a minimum price requiredto be paid to producers for Class I milk established by the commission inregulations adopted pursuant to sections ten and eleven of this compact, whichis above the price established in federal marketing orders or by state farmprice regulation in the regulated area. Such price may apply throughout theregion or in any part or parts thereof as defined in the regulations of thecommission.
(9) "Commission marketing order" means regulations adopted bythe commission pursuant to sections ten and eleven of this compact in place ofa terminated 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 for anyor all classes of milk.
(10) "Milk" means the lacteal secretion of cows and includesall skim, butterfat, or other constituents obtained from separation or anyother process. The term is used in its broadest sense and may be furtherdefined by the commission for regulatory purposes.
(11) "Class I milk" means milk disposed of in fluid form oras a fluid milk product, subject to further definition in accordance with theprinciples expressed in subdivision (b) of § 3.
(12) "State dairy regulation" means any state regulation ofdairy prices, and associated assessments, whether by statute, marketing orderor otherwise.
Section 3. Rules of construction. (a) This compact shall notbe construed to displace existing federal milk marketing orders or state dairyregulation in the region but to supplement them. In the event some or allfederal orders in the region are discontinued, the compact shall be construedto provide the commission the option to replace them with one or morecommission marketing orders pursuant to this compact.
(b) This compact shall be construed liberally in order toachieve the purposes and intent enunciated in section one. It is the intent ofthis compact 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 to affordthe commission broad flexibility to devise regulatory mechanisms to achieve thepurposes of this compact. In accordance with this intent, the technical termswhich are associated with market order regulation and which have acquiredcommonly understood general meanings are not defined herein but the commissionmay further define the terms used in this compact and develop additionalconcepts and define additional terms as it may find appropriate to achieve itspurposes.
ARTICLE III
COMMISSION ESTABLISHED
Section 4. Commission established. There is hereby created acommission to administer the compact, composed of delegations from each statein the region. A delegation shall include not less than three (3) nor more thanfive (5) persons. Each delegation shall include at least one (1) dairy farmerwho is engaged in the production of milk at the time of appointment orreappointment and one (1) consumer representative. Delegation members shall beresidents and voters of, and subject to such confirmation process as providedin, the appointing state. Delegation members shall serve no more than three (3)consecutive terms, with no single term of more than four (4) years, and besubject to removal for cause. In all other respects, delegation members shallserve in accordance with the laws of the state represented. The compensation,if any, of the members of a state delegation shall be determined and paid byeach state, but their expenses shall be paid by the commission. Each statedelegation shall be entitled to one (1) vote in the conduct of the commission'saffairs.
Section 5. Voting requirements. All actions taken by thecommission, except for the establishment or termination of an over-order priceor commission marketing order, and the adoption, amendment or rescission of thecommission's by-laws, shall be by majority vote of the delegations present.Establishment or termination of an over-order prices or commission marketingorder shall require at least a two-thirds (2/3) vote of the delegationspresent. The establishment of a regulated area which covers all or part of aparticipating state shall require also the affirmative vote of the state'sdelegation. A majority of the delegations from the participating states shallconstitute a quorum of the conduct of the commission's business.
Section 6. Administration and management. (a) The commissionshall elect annually from among the members of the participating statedelegations a chairperson, a vice-chairperson, and a treasurer. The commissionshall appoint an executive director and fix his or her duties and compensation.The executive director shall serve at the pleasure of the commission, and,together with the treasurer, shall be bonded in an amount determined by thecommission. The commission may establish through its by-laws an executivecommittee composed of one (1) member elected by each delegation.
(b) The commission shall adopt by-laws for the conduct of itsbusiness by a two-thirds (2/3) vote and shall have the power by the same voteto amend and rescind these by-laws. The commission shall publish its by-laws inconvenient form with the appropriate agency or officer in each of theparticipating states. The by-laws shall provide for appropriate notice to thedelegations of all commission meetings and hearings and of the business to betransacted at such meetings or hearings. Notice also shall be given to otheragencies or officers of participating states as provided by the laws of thosestates.
(c) The commissions shall file an annual report with thesecretary of agriculture of the United States, and with each of theparticipating states by submitting copies to the governor, both houses of thelegislature, and the head of the state department having responsibilities foragriculture.
(d) In addition to the powers and duties elsewhere prescribedin this compact, 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 personalproperty by gift, purchase, lease, license, or other similar manner, for itscorporate purposes;
(4) To borrow money and to issue notes, to provide for therights of the holders thereof and to pledge the revenue of the commission assecurity therefor, subject to the provisions of § 18 of this compact;
(5) Appoint such officers, agents, and employees as it maydeem necessary, prescribe their powers, duties, and qualifications; and
(6) To create and abolish such offices, employments, andpositions as it deems necessary for the purposes of their compact and providefor the removal, term, tenure, compensation, fringe benefits, pension, andretirement rights of these officers and employees. The commission may alsoretain personal services on a contract basis.
Section 7. Rule-making power. In addition to the power topromulgate a compact over-order price or commission marketing orders asprovided by this compact, the commission is further empowered to make andenforce such additional rules and regulations as it deems necessary toimplement any provisions of this compact, or to effectuate in any other respectthe purposes of this compact.
ARTICLE IV
POWERS OF THE COMMISSION
Section 8. Powers to promote regulatory uniformity,simplicity and interstate cooperation. The commission is hereby empowered to:
(1) Investigate or provide for investigations or researchprojects designed to review the existing laws and regulations of theparticipating states, to consider their administration and costs, to measuretheir impact on the production and marketing of milk and their effects on theshipment of milk and milk products within the region.
(2) Prepare and transmit to the participating states modeldairy laws and regulations dealing with the inspection of farms and plants,sanitary codes, labels for dairy products and their imitations, standards fordairy products, license standards, producer security programs, and fair tradelaws.
(3) Study and recommend to the participating states joint orcooperative programs for the administration of the dairy laws and regulationsand to prepare estimates of cost savings and benefits of such programs.
(4) Encourage the harmonious relationships between thevarious elements in the industry for the solution of their material problems.Conduct symposiums or conferences designed to improve industry relations, or abetter understanding of problems.
(5) Prepare and release periodic reports on activities andresults of the commission's efforts to the participating states.
(6) Review the existing marketing system for milk and milkproducts and recommend changes in the existing structure for assembly anddistribution of milk which may assist, improve, or promote more efficientassembly and distribution of milk.
(7) Investigate costs and charges for producing, hauling,handling, processing, distributing, selling and for all other servicesperformed with respect to milk.
(8) Examine current economic forces affecting producers,probable trends in production and consumption, the level of dairy farm pricesin relation to costs, the financial conditions of dairy farmers, and the needfor an emergency order to relieve critical conditions on dairy farms.
Section 9. Equitable farm prices. (a) The power granted inthis section and § 10 shall apply only to the establishment of a compactover-order price, so long as federal milk marketing orders remain in effect inthe region. In the event that any or all such orders are terminated, thisarticle shall authorize the commission to establish one (1) or more commissionmarketing orders, as herein provided, in the region or parts thereof as definedin the order.
(b) A compact over-order price established pursuant to thissection shall apply only to class I milk. Such over-order price shall notexceed one dollar fifty cents ($1.50) per gallon. Beginning in 1990, and usingthat year as a base, the foregoing one dollar fifty cents ($1.50) per gallonmaximum shall be adjusted annually by the rate of change in the consumer priceindex as reported by the bureau of labor statistics of the United Statesdepartment of labor. For purposes of the pooling and equalization of anover-order price, the value of milk used in other use classifications shall becalculated at the appropriate class price established pursuant to theapplicable federal order or state dairy regulation and the value of unregulatedmilk shall be calculated in relation to the nearest prevailing class price inaccordance with and subject to such adjustments as the commission may prescribein regulations.
(c) A commission marketing order shall apply to all classesand uses of milk.
(d) The commission is hereby empowered to establish theminimum price for milk to be paid by pool plants, partially regulated plantsand all other handlers receiving milk from producers located in a regulatedarea. This price shall be established either as a compact over-order price orby one (1) or more commission marketing orders. Whenever such a price has beenestablished by either type of regulation, the legal obligation to pay suchprice shall be determined solely by the terms and purpose of the regulationwithout regard to the situs of the transfer of title, possession or any otherfactors not related to the purposes of the regulation and this compact.Producer-handlers as defined in an applicable federal milk marketing ordershall not be subject to a compact over-order price. The commission shallprovide for similar treatment of producer-handlers under commission marketingorders.
(e) In determining the price, the commission shall considerthe balance between production and consumption of milk and milk products in theregulated area, the costs of production including, but not limited to the priceof feed, the cost of labor including the reasonable value of the producer's ownlabor and management, machinery expense, and interest expense, the prevailingprice for milk outside the regulated area, the purchasing power of the publicand the price necessary to yield a reasonable return to the producer anddistributor.
(f) When establishing a compact over-order price, thecommission shall take such action as necessary and feasible to ensure that theover-order price does not create an incentive for producers to generateadditional supplies of milk.
(g) The commission shall whenever possible enter intoagreements with state or federal agencies for exchange of information orservices for the purpose of reducing regulatory burden and cost ofadministering the compact. The commission may reimburse other agencies for thereasonable cost of providing these services.
Section 10. Optional provisions for pricing order.Regulations establishing a compact over-order price or a commission marketingorder may contain, but shall not be limited to, any of the following:
(1) Provisions classifying milk in accordance with the formin which or purpose for which it is used, or creating a flat pricing program.
(2) With respect to a commission marketing order only,provisions establishing or providing a method for establishing separate minimumprices for each use classification prescribed by the commission, or a singleminimum price for milk purchased from producers or associations of producers.
(3) With respect to an over-order minimum price, provisionsestablishing or providing a method for establishing such minimum price forclass I milk.
(4) Provisions for establishing either an over-order price ora commission 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 and forcompetitive credits with respect to regulated handlers who market outside theregulated area.
(5) Provisions for the payment to all producers andassociations of producers delivering milk to all handlers of uniform prices forall milk so delivered, irrespective of the uses made of such milk by theindividual handler to whom it is delivered, or for the payment of producersdelivering milk to the same handler of uniform prices for all milk delivered bythem.
(A) With respect to regulations establishing a compactover-order price, the commission may establish one (1) equalization pool withinthe regulated area for the sole purpose of equalizing returns to producersthroughout the regulated area.
(B) With respect to any commission marketing order, asdefined in § 2, which replaces one (1) or more terminated federal ordersor state dairy regulation, the marketing area of now separate state or federalorders shall not be merged without the affirmative consent of each state,voting through its delegation, which is partly or wholly included within anysuch new marketing area.
(6) Provisions, requiring persons who bring class I milk intothe regulated area to make compensatory payments with respect to all such milkto the 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 paid to producers for such milk in thestate of production by a federal milk marketing order or state dairy regulationand the Class I price established by the compact over-order price or commissionmarketing order.
(7) Provisions specially governing the pricing and pooling ofmilk handled by partially regulated plants.
(8) Provisions requiring that the account of any personregulated under a compact over-order price shall be adjusted for any paymentsmade to or received by such persons with respect to a producer settlement fundof any federal or state milk marketing order or other state dairy regulationwithin the regulated area.
(9) Provisions requiring the payment by handlers of anassessment to cover the costs of the administration and enforcement of suchorder pursuant to article VII, § 18(a).
(10) Provision for reimbursement to participants of theWomen, Infants and Children Special Supplemental Food Program of the UnitedStates Child Nutrition Act of 1966 [42 U.S.C. § 1771 et seq.].
(11) Other provisions and requirements as the commission mayfind are necessary or appropriate to effectuate the purposes of this compactand to provide for the payment of fair and equitable minimum prices toproducers.
ARTICLE V
RULEMAKING PROCEDURE
Section 11. Rulemaking procedure. Before promulgation of anyregulations establishing a compact over-order price or commission marketingorder, including any provision with respect to milk supply under § 9(f) oramendment thereof, as provided in article IV, the commission shall conduct aninformal rulemaking proceeding to provide interested persons with anopportunity to present data and views. Such rulemaking proceeding shall begoverned by § 4 of the federal administrative procedures act, as amended(5 U.S.C. § 553). In addition, the commission shall, to the extentpracticable, publish notice of rulemaking proceedings in the official registerof each participating state. Before the initial adoption of regulationsestablishing a compact over-order price or a commission marketing order andthereafter before any amendment with regard to prices or assessments, thecommission shall hold a public hearing. The commission may commence arulemaking proceeding on its own initiative or may in its sole discretion actupon the petition of any person including individual milk producers, anyorganization of milk producers or handlers, general farm organizations,consumer or public interest groups, and local, state or federal officials.
Section 12. Findings and referendum. (a) In addition to theconcise general statement of basis and purpose required by § 4(b) of thefederal administrative procedures act, as amended (5 U.S.C. § 553(c)), thecommission shall make findings of fact with respect to:
(1) Whether the public interest will be served by theestablishment of minimum milk prices to dairy farmers under article IV.
(2) What level of prices will assure that producers receive aprice sufficient 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 thanthose fixing minimum milk prices, are in the public interest and are reasonablydesigned to achieve the purposes of the order.
(4) Whether the terms of the proposed regional order oramendment are approved by producers as provided in § 13.
Section 13. Producer referendum. (a) For the purpose ofascertaining whether the issuance or amendment of regulations establishing acompact over-order price or a commission marketing order, including anyprovision with respect to milk supply under § 9(f) is approved byproducers, the commission shall conduct a referendum among producers. Thereferendum shall be held in a timely manner, as determined by regulation of thecommission. The terms and conditions of the proposed order or amendment shallbe described by the commission in the ballot used in the conduct of thereferendum, but the nature, content, or extent of such description shall not bea basis for attacking the legality of the order or any action relating thereto.
(b) An order or amendment shall be deemed approved byproducers if the commission determines that it is approved by at leasttwo-thirds (2/3) of the voting producers who, during a representative perioddetermined by the commission, have been engaged in the production of milk theprice of which would be regulated under the proposed order or amendment.
(c) For purposes of any referendum, the commission shallconsider the approval or disapproval by any cooperative association ofproducers, qualified under the provisions of the Act of Congress of February18, 1922, as amended, known as the Capper-Volstead Act [U.S.C.§§ 291 and 292], 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 subdivisions (2) through (5) hereof.
(1) No cooperative which has been formed to act as a commonmarketing agency for both cooperatives and individual producers shall bequalified to block vote for either.
(2) Any cooperative which is qualified to block vote shall,before submitting its approval or disapproval in any referendum, give priorwritten notice to each of its members as to whether and how it intends to castits vote. The notice shall be given in a timely manner, as established, and inthe form prescribed, by the commission.
(3) Any producer may obtain a ballot from the commission inorder to register approval or disapproval of the proposed order.
(4) A producer who is a member of a cooperative which hasprovided notice of its intent to approve or not to approve a proposed order,and who obtains a ballot and with such ballot expresses his or her approval ordisapproval of the proposed order, shall notify the commission as to the nameof the cooperative of which he or she is a member, and the commission shallremove such producer's name from the list certified by such cooperative withits corporate vote.
(5) In order to insure that all milk producers are informedregarding a proposed order, the commission shall notify all milk producers thatan order is being considered and that each producer may register his or herapproval or disapproval with the commission either directly or through his orher cooperative.
Section 14. Termination of over-order price or marketingorder. (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 regulationsestablishing an over-order price or a commission marketing order issued underthis article whenever it finds that such termination is favored by a majorityof the producers who, during a representative period determined by thecommission, have been engaged in the production of milk the price of which isregulated by such order; but such termination shall be effective only ifannounced on or before such date as may be specified in such marketingagreement or order.
(c) The termination or suspension of any order or provisionthereof, shall not be considered an order within the meaning of this articleand shall require no hearing, but shall comply with the requirements forinformal rulemaking prescribed by § 4 of the Federal AdministrativeProcedure Act, as amended (5 U.S.C. § 553.)
ARTICLE VI
ENFORCEMENT
Section 15. Records, reports, access to premises. (a) Thecommission may by rule and regulation prescribe record keeping and reportingrequirements for all regulated persons. For purposes of the administration andenforcement of this compact, the commission is authorized to examine the booksand records of any regulated person relating to his or her milk business andfor that purpose, the commission's properly designated officers, employees, oragents shall have full access during normal business hours to the premises andrecords of all regulated persons.
(b) Information furnished to or acquired by the commissionofficers, employees, or its agents pursuant to this section shall beconfidential and not subject to disclosure except to the extent that thecommission deems disclosure to be necessary in any administrative or judicialproceeding involving the administration or enforcement of this compact, anover-order price, a compact marketing order, or other regulations of thecommission. The commission may promulgate regulations further defining theconfidentiality of information pursuant to this section. Nothing in thissection shall be deemed to prohibit (i) the issuance of general statementsbased upon the reports of a number of handlers, which do not identify theinformation furnished by any person, or (ii) the publication by direction ofthe commission 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 shallintentionally disclose information, by inference or otherwise, which is madeconfidential pursuant to this section. Any person violating the provisions ofthis section shall upon conviction be subject to a fine of not more than onethousand dollars ($1,000) or to imprisonment for not more than one year, or toboth, and shall be removed from office. The commission shall refer anyallegation of a violation of this section to the appropriate state enforcementauthority or United States Attorney.
Section 16. Subpoena, hearings and judicial review. (a) Thecommission is hereby authorized and empowered by its members and its properlydesignated officers to administer oaths and issue subpoenas through out allsignatory states to compel the attendance of witnesses and the giving oftestimony and the production of other evidence.
(b) Any handler subject to an order may file a writtenpetition with the commission stating that any such order or any provision ofany such order or any obligation imposed in connection therewith is not inaccordance with law and praying for a modification thereof or to be exemptedtherefrom. He or she shall thereupon be given an opportunity for a hearing uponsuch petition, in accordance with regulations made by the commission. Aftersuch hearing, the commission shall make a ruling upon the prayer of suchpetition which shall be final, if in accordance with law.
(c) The district courts of the United States in any districtin which such handler is an inhabitant, or has his or her principal place ofbusiness, are hereby vested with jurisdiction in equity to review such ruling,provided a bill in equity for that purpose is filed within thirty (30) daysfrom the date of entry of such ruling. Service of process in such proceedingsmay be had upon the commission by delivering to it a copy of the bill ofcomplaint. If the court determines that such ruling is not in accordance withlaw, it shall remand such proceedings to the commission with directions either(1) to make such ruling as the court shall determine to be in accordance withlaw, or (2) to take such further proceedings as, in its opinion, the lawrequires. The pendency of proceedings instituted pursuant to this subsectionshall not impede, hinder, or delay the commission from obtaining reliefpursuant to subsection 18. Any proceedings brought pursuant to § 18(except where brought by way of counterclaim in proceedings instituted pursuantto this section) shall abate whenever a final decree has been rendered inproceedings between the same parties, and covering the same subject matter,instituted pursuant to this section.
Section 17. Enforcement with respect to handlers. (a) Anyviolation by a handler of the provisions of regulations establishing anover-order price or a commission marketing order, or other regulations adoptedpursuant to this compact shall:
(1) Constitute a violation of the laws of each of thesignatory states. Such violation shall render the violator subject to a civilpenalty in an amount as may be prescribed by the laws of each of theparticipating states, recoverable in any state or federal court of competentjurisdiction. Each day such violation continues shall constitute a separateviolation.
(2) Constitute grounds for the revocation of license orpermit to engage in the milk business under the applicable laws of theparticipating states.
(b) With respect to handlers, the commission shall enforcethe provisions 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 reliefbrought in the name of the commission in any state or federal court ofcompetent jurisdiction; or
(2) With the agreement of the appropriate state agency of aparticipating state, by referral to the state agency for enforcement byjudicial or administrative remedy.
(c) With respect to handlers, the commission may bring anaction for injunction 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
Section 18. Finance of start-up and regular costs. (a) Toprovide for its start-up costs, the commission may borrow money pursuant to itsgeneral power under § 6 (d)(4). In order to finance the costs ofadministration and enforcement of this compact, including pay back of start-upcosts, the commission is hereby empowered to collect an assessment from eachhandler who purchases milk from producers within the region. The initialassessment may apply to the projected purchases of handlers for the two (2)month period following the date the commission convenes. If imposed, thisassessment shall be collected on a monthly basis for up to one (1) year fromthe date the commission convenes, in an amount not to exceed one-tenth of onepercent (0.1%) of the applicable federal milk marketing order blend price perhundred weight of milk purchased from producers during the period of theassessment. In addition, if regulations establishing an over-order price or acompact marketing order are adopted, they may include an assessment for thespecific purpose of their administration. These regulations shall provide forestablishment of a reserve for the commission's ongoing operating expenses.
(b) The commission shall not pledge the credit of anyparticipating state or of the United States. Notes issued by the commission andall other financial obligations incurred by it, shall be its soleresponsibility and no participating state or the United States shall be liabletherefor.
Section 19. Audit and accounts. (a) The commission shall keepaccurate accounts of all receipts and disbursements, which shall be subject tothe audit and accounting procedures established under its rules. In addition,all receipts and disbursements of funds handled by the commission shall beaudited yearly by a qualified public accountant and the report of the auditshall be included in and become part of the annual report of the commission.
(b) The accounts of the commission shall be open at anyreasonable time for inspection by duly constituted officers of theparticipating states and by any persons authorized by the commission.
(c) Nothing contained in this article shall be construed toprevent commission compliance with laws relating to audit or inspection ofaccounts by or on behalf of any participating state or of the United States.
ARTICLE VIII
ENTRY INTO FORCE – ADDITIONAL MEMBERS ANDWITHDRAWAL
Section 20. Entry into force – Additional members. Thecompact shall enter into force effective when enacted into law by any three (3)states of the group of states composed of Connecticut, Delaware, Maine,Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania,Rhode Island, Vermont, and Virginia, and when the consent of congress has beenobtained. This compact shall also be open to states which are contiguous to anyof the named states and open to states which are contiguous to participatingstates.
Section 22. Withdrawal from compact. Any participating statemay withdraw from this compact by enacting a statute repealing the same, but nosuch withdrawal shall take effect until one (1) year after notice in writing ofthe withdrawal is given to the commission and the governors of all otherparticipating states. No withdrawal shall affect any liability already incurredby or chargeable to a party state prior to the time of such withdrawal.
Section 23. Severability. If any part or provision of thiscompact is adjudged invalid by any court, such judgment shall be confined inits operation to the part or provision directly involved in the controversy inwhich such judgment shall have been rendered and shall not affect or impair thevalidity of the remainder of this compact.
§ 2-24-1 Ratification of compact –Text. – The governor having entered on behalf of this state into a compact,substantially in the following form, with one or more of the states ofConnecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, NewJersey, New York, Pennsylvania, Vermont and Virginia and with any other statesof the United States or provinces of the Dominion of Canada as may have legallyjoined in this compact, the legislature signifies its approval and ratificationof the compact entered into, as to any of those states or provinces that mayhave or may hereafter legally join in the compact:
ARTICLE I
STATEMENT OF PURPOSE, FINDINGS AND DECLARATION OFPOLICY
Section 1. Statement of purpose, findings and declaration ofpolicy. The purpose of this compact is to recognize by constitutionalprerequisite the interstate character of the northeast dairy industry and toform an interstate commission for the northeast region. The mission of thecommission is to take such steps as are necessary to assure the continuedviability of dairy farming in the northeast, and to assure consumers of anadequate, local supply of pure and wholesome milk.
In today's regional dairy marketplace, cooperative, ratherthan individual state action may address more effectively the market disarray.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.
In establishing their constitutional regulatory authorityover the region's fluid milk market by this compact, the participating statesdeclare their purpose that this compact neither displace the federal ordersystem nor encourage the merging of federal orders. Specific provisions of thecompact itself set forth this basic principle.
Designed as a flexible mechanism able to adjust to changes ina regulated marketplace, the compact also contains a contingency provisionshould the federal 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.
Recent, dramatic price fluctuations, with a pronounceddownward trend, threaten the viability and stability of the northeast dairyregion. Historically, individual state regulatory action has been an effectiveemergency remedy available to farmers confronting a distressed market. Thefederal order system, implemented by the Agricultural Marketing Agreement Actof 1937 [7 U.S.C. § 601 et seq.], establishes only minimumprices for dairy products, without preempting the power of states to regulatemilk prices above the minimum levels so established. Based on this authority,each state in the region has individually attempted to implement at least oneregulatory program in response to the current dairy industry crisis.
The participating states find and declare that the dairyindustry is the paramount agricultural activity of the northeast. Dairy farms,and associated suppliers, marketers, processors and retailers, are an integralcomponent of the region's economy. Their ability to provide a stable, localsupply of pure, wholesome milk is a matter of great importance to the healthand welfare of the region.
The participating states further find that dairy farms areessential to the region's rural communities and character. The farms preserveopen spaces, sculpt the landscape and provide the land base for a diversity ofrecreational pursuits. In defining the rural character of our communities andlandscape, dairy farms also provide a major draw for our tourist industries.
By entering into this compact, the participating statesaffirm that their ability to regulate the price which northeast dairy farmersreceive for their product is essential to the public interest. Assurance of afair and equitable price for dairy farmers ensures their ability to providemilk to the market and the vitality of the northeast dairy industry, with allthe associated benefits.
ARTICLE II
DEFINITIONS AND RULES OF CONSTRUCTION
Section 2. Definitions. For the purpose of this compact, andof any supplemental or concurring legislation enacted pursuant thereto, exceptas may be otherwise required by the context:
(1) "Commission" means the commission established by thiscompact.
(2) "Compact" means this interstate compact.
(3) "Region" means the territorial limits of the states whichare or become parties to this compact.
(4) "Participating state" means a state which has become aparty to this compact by the enactment of concurring legislation.
(5) "Regulated area" means any area within the regiongoverned by and defined in regulations establishing a compact over-order priceor commission marketing order.
(6) "Pool plant" means any milk plant located in a regulatedarea.
(7) "Partially regulated plant" means a milk plant notlocated in a regulated area but having Class I distribution within such area,or receipts from producers located in such area. Commission regulations mayexempt plants having such distribution or receipts in amounts less than thelimits defined therein.
(8) "Compact over-order price" means a minimum price requiredto be paid to producers for Class I milk established by the commission inregulations adopted pursuant to sections ten and eleven of this compact, whichis above the price established in federal marketing orders or by state farmprice regulation in the regulated area. Such price may apply throughout theregion or in any part or parts thereof as defined in the regulations of thecommission.
(9) "Commission marketing order" means regulations adopted bythe commission pursuant to sections ten and eleven of this compact in place ofa terminated 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 for anyor all classes of milk.
(10) "Milk" means the lacteal secretion of cows and includesall skim, butterfat, or other constituents obtained from separation or anyother process. The term is used in its broadest sense and may be furtherdefined by the commission for regulatory purposes.
(11) "Class I milk" means milk disposed of in fluid form oras a fluid milk product, subject to further definition in accordance with theprinciples expressed in subdivision (b) of § 3.
(12) "State dairy regulation" means any state regulation ofdairy prices, and associated assessments, whether by statute, marketing orderor otherwise.
Section 3. Rules of construction. (a) This compact shall notbe construed to displace existing federal milk marketing orders or state dairyregulation in the region but to supplement them. In the event some or allfederal orders in the region are discontinued, the compact shall be construedto provide the commission the option to replace them with one or morecommission marketing orders pursuant to this compact.
(b) This compact shall be construed liberally in order toachieve the purposes and intent enunciated in section one. It is the intent ofthis compact 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 to affordthe commission broad flexibility to devise regulatory mechanisms to achieve thepurposes of this compact. In accordance with this intent, the technical termswhich are associated with market order regulation and which have acquiredcommonly understood general meanings are not defined herein but the commissionmay further define the terms used in this compact and develop additionalconcepts and define additional terms as it may find appropriate to achieve itspurposes.
ARTICLE III
COMMISSION ESTABLISHED
Section 4. Commission established. There is hereby created acommission to administer the compact, composed of delegations from each statein the region. A delegation shall include not less than three (3) nor more thanfive (5) persons. Each delegation shall include at least one (1) dairy farmerwho is engaged in the production of milk at the time of appointment orreappointment and one (1) consumer representative. Delegation members shall beresidents and voters of, and subject to such confirmation process as providedin, the appointing state. Delegation members shall serve no more than three (3)consecutive terms, with no single term of more than four (4) years, and besubject to removal for cause. In all other respects, delegation members shallserve in accordance with the laws of the state represented. The compensation,if any, of the members of a state delegation shall be determined and paid byeach state, but their expenses shall be paid by the commission. Each statedelegation shall be entitled to one (1) vote in the conduct of the commission'saffairs.
Section 5. Voting requirements. All actions taken by thecommission, except for the establishment or termination of an over-order priceor commission marketing order, and the adoption, amendment or rescission of thecommission's by-laws, shall be by majority vote of the delegations present.Establishment or termination of an over-order prices or commission marketingorder shall require at least a two-thirds (2/3) vote of the delegationspresent. The establishment of a regulated area which covers all or part of aparticipating state shall require also the affirmative vote of the state'sdelegation. A majority of the delegations from the participating states shallconstitute a quorum of the conduct of the commission's business.
Section 6. Administration and management. (a) The commissionshall elect annually from among the members of the participating statedelegations a chairperson, a vice-chairperson, and a treasurer. The commissionshall appoint an executive director and fix his or her duties and compensation.The executive director shall serve at the pleasure of the commission, and,together with the treasurer, shall be bonded in an amount determined by thecommission. The commission may establish through its by-laws an executivecommittee composed of one (1) member elected by each delegation.
(b) The commission shall adopt by-laws for the conduct of itsbusiness by a two-thirds (2/3) vote and shall have the power by the same voteto amend and rescind these by-laws. The commission shall publish its by-laws inconvenient form with the appropriate agency or officer in each of theparticipating states. The by-laws shall provide for appropriate notice to thedelegations of all commission meetings and hearings and of the business to betransacted at such meetings or hearings. Notice also shall be given to otheragencies or officers of participating states as provided by the laws of thosestates.
(c) The commissions shall file an annual report with thesecretary of agriculture of the United States, and with each of theparticipating states by submitting copies to the governor, both houses of thelegislature, and the head of the state department having responsibilities foragriculture.
(d) In addition to the powers and duties elsewhere prescribedin this compact, 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 personalproperty by gift, purchase, lease, license, or other similar manner, for itscorporate purposes;
(4) To borrow money and to issue notes, to provide for therights of the holders thereof and to pledge the revenue of the commission assecurity therefor, subject to the provisions of § 18 of this compact;
(5) Appoint such officers, agents, and employees as it maydeem necessary, prescribe their powers, duties, and qualifications; and
(6) To create and abolish such offices, employments, andpositions as it deems necessary for the purposes of their compact and providefor the removal, term, tenure, compensation, fringe benefits, pension, andretirement rights of these officers and employees. The commission may alsoretain personal services on a contract basis.
Section 7. Rule-making power. In addition to the power topromulgate a compact over-order price or commission marketing orders asprovided by this compact, the commission is further empowered to make andenforce such additional rules and regulations as it deems necessary toimplement any provisions of this compact, or to effectuate in any other respectthe purposes of this compact.
ARTICLE IV
POWERS OF THE COMMISSION
Section 8. Powers to promote regulatory uniformity,simplicity and interstate cooperation. The commission is hereby empowered to:
(1) Investigate or provide for investigations or researchprojects designed to review the existing laws and regulations of theparticipating states, to consider their administration and costs, to measuretheir impact on the production and marketing of milk and their effects on theshipment of milk and milk products within the region.
(2) Prepare and transmit to the participating states modeldairy laws and regulations dealing with the inspection of farms and plants,sanitary codes, labels for dairy products and their imitations, standards fordairy products, license standards, producer security programs, and fair tradelaws.
(3) Study and recommend to the participating states joint orcooperative programs for the administration of the dairy laws and regulationsand to prepare estimates of cost savings and benefits of such programs.
(4) Encourage the harmonious relationships between thevarious elements in the industry for the solution of their material problems.Conduct symposiums or conferences designed to improve industry relations, or abetter understanding of problems.
(5) Prepare and release periodic reports on activities andresults of the commission's efforts to the participating states.
(6) Review the existing marketing system for milk and milkproducts and recommend changes in the existing structure for assembly anddistribution of milk which may assist, improve, or promote more efficientassembly and distribution of milk.
(7) Investigate costs and charges for producing, hauling,handling, processing, distributing, selling and for all other servicesperformed with respect to milk.
(8) Examine current economic forces affecting producers,probable trends in production and consumption, the level of dairy farm pricesin relation to costs, the financial conditions of dairy farmers, and the needfor an emergency order to relieve critical conditions on dairy farms.
Section 9. Equitable farm prices. (a) The power granted inthis section and § 10 shall apply only to the establishment of a compactover-order price, so long as federal milk marketing orders remain in effect inthe region. In the event that any or all such orders are terminated, thisarticle shall authorize the commission to establish one (1) or more commissionmarketing orders, as herein provided, in the region or parts thereof as definedin the order.
(b) A compact over-order price established pursuant to thissection shall apply only to class I milk. Such over-order price shall notexceed one dollar fifty cents ($1.50) per gallon. Beginning in 1990, and usingthat year as a base, the foregoing one dollar fifty cents ($1.50) per gallonmaximum shall be adjusted annually by the rate of change in the consumer priceindex as reported by the bureau of labor statistics of the United Statesdepartment of labor. For purposes of the pooling and equalization of anover-order price, the value of milk used in other use classifications shall becalculated at the appropriate class price established pursuant to theapplicable federal order or state dairy regulation and the value of unregulatedmilk shall be calculated in relation to the nearest prevailing class price inaccordance with and subject to such adjustments as the commission may prescribein regulations.
(c) A commission marketing order shall apply to all classesand uses of milk.
(d) The commission is hereby empowered to establish theminimum price for milk to be paid by pool plants, partially regulated plantsand all other handlers receiving milk from producers located in a regulatedarea. This price shall be established either as a compact over-order price orby one (1) or more commission marketing orders. Whenever such a price has beenestablished by either type of regulation, the legal obligation to pay suchprice shall be determined solely by the terms and purpose of the regulationwithout regard to the situs of the transfer of title, possession or any otherfactors not related to the purposes of the regulation and this compact.Producer-handlers as defined in an applicable federal milk marketing ordershall not be subject to a compact over-order price. The commission shallprovide for similar treatment of producer-handlers under commission marketingorders.
(e) In determining the price, the commission shall considerthe balance between production and consumption of milk and milk products in theregulated area, the costs of production including, but not limited to the priceof feed, the cost of labor including the reasonable value of the producer's ownlabor and management, machinery expense, and interest expense, the prevailingprice for milk outside the regulated area, the purchasing power of the publicand the price necessary to yield a reasonable return to the producer anddistributor.
(f) When establishing a compact over-order price, thecommission shall take such action as necessary and feasible to ensure that theover-order price does not create an incentive for producers to generateadditional supplies of milk.
(g) The commission shall whenever possible enter intoagreements with state or federal agencies for exchange of information orservices for the purpose of reducing regulatory burden and cost ofadministering the compact. The commission may reimburse other agencies for thereasonable cost of providing these services.
Section 10. Optional provisions for pricing order.Regulations establishing a compact over-order price or a commission marketingorder may contain, but shall not be limited to, any of the following:
(1) Provisions classifying milk in accordance with the formin which or purpose for which it is used, or creating a flat pricing program.
(2) With respect to a commission marketing order only,provisions establishing or providing a method for establishing separate minimumprices for each use classification prescribed by the commission, or a singleminimum price for milk purchased from producers or associations of producers.
(3) With respect to an over-order minimum price, provisionsestablishing or providing a method for establishing such minimum price forclass I milk.
(4) Provisions for establishing either an over-order price ora commission 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 and forcompetitive credits with respect to regulated handlers who market outside theregulated area.
(5) Provisions for the payment to all producers andassociations of producers delivering milk to all handlers of uniform prices forall milk so delivered, irrespective of the uses made of such milk by theindividual handler to whom it is delivered, or for the payment of producersdelivering milk to the same handler of uniform prices for all milk delivered bythem.
(A) With respect to regulations establishing a compactover-order price, the commission may establish one (1) equalization pool withinthe regulated area for the sole purpose of equalizing returns to producersthroughout the regulated area.
(B) With respect to any commission marketing order, asdefined in § 2, which replaces one (1) or more terminated federal ordersor state dairy regulation, the marketing area of now separate state or federalorders shall not be merged without the affirmative consent of each state,voting through its delegation, which is partly or wholly included within anysuch new marketing area.
(6) Provisions, requiring persons who bring class I milk intothe regulated area to make compensatory payments with respect to all such milkto the 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 paid to producers for such milk in thestate of production by a federal milk marketing order or state dairy regulationand the Class I price established by the compact over-order price or commissionmarketing order.
(7) Provisions specially governing the pricing and pooling ofmilk handled by partially regulated plants.
(8) Provisions requiring that the account of any personregulated under a compact over-order price shall be adjusted for any paymentsmade to or received by such persons with respect to a producer settlement fundof any federal or state milk marketing order or other state dairy regulationwithin the regulated area.
(9) Provisions requiring the payment by handlers of anassessment to cover the costs of the administration and enforcement of suchorder pursuant to article VII, § 18(a).
(10) Provision for reimbursement to participants of theWomen, Infants and Children Special Supplemental Food Program of the UnitedStates Child Nutrition Act of 1966 [42 U.S.C. § 1771 et seq.].
(11) Other provisions and requirements as the commission mayfind are necessary or appropriate to effectuate the purposes of this compactand to provide for the payment of fair and equitable minimum prices toproducers.
ARTICLE V
RULEMAKING PROCEDURE
Section 11. Rulemaking procedure. Before promulgation of anyregulations establishing a compact over-order price or commission marketingorder, including any provision with respect to milk supply under § 9(f) oramendment thereof, as provided in article IV, the commission shall conduct aninformal rulemaking proceeding to provide interested persons with anopportunity to present data and views. Such rulemaking proceeding shall begoverned by § 4 of the federal administrative procedures act, as amended(5 U.S.C. § 553). In addition, the commission shall, to the extentpracticable, publish notice of rulemaking proceedings in the official registerof each participating state. Before the initial adoption of regulationsestablishing a compact over-order price or a commission marketing order andthereafter before any amendment with regard to prices or assessments, thecommission shall hold a public hearing. The commission may commence arulemaking proceeding on its own initiative or may in its sole discretion actupon the petition of any person including individual milk producers, anyorganization of milk producers or handlers, general farm organizations,consumer or public interest groups, and local, state or federal officials.
Section 12. Findings and referendum. (a) In addition to theconcise general statement of basis and purpose required by § 4(b) of thefederal administrative procedures act, as amended (5 U.S.C. § 553(c)), thecommission shall make findings of fact with respect to:
(1) Whether the public interest will be served by theestablishment of minimum milk prices to dairy farmers under article IV.
(2) What level of prices will assure that producers receive aprice sufficient 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 thanthose fixing minimum milk prices, are in the public interest and are reasonablydesigned to achieve the purposes of the order.
(4) Whether the terms of the proposed regional order oramendment are approved by producers as provided in § 13.
Section 13. Producer referendum. (a) For the purpose ofascertaining whether the issuance or amendment of regulations establishing acompact over-order price or a commission marketing order, including anyprovision with respect to milk supply under § 9(f) is approved byproducers, the commission shall conduct a referendum among producers. Thereferendum shall be held in a timely manner, as determined by regulation of thecommission. The terms and conditions of the proposed order or amendment shallbe described by the commission in the ballot used in the conduct of thereferendum, but the nature, content, or extent of such description shall not bea basis for attacking the legality of the order or any action relating thereto.
(b) An order or amendment shall be deemed approved byproducers if the commission determines that it is approved by at leasttwo-thirds (2/3) of the voting producers who, during a representative perioddetermined by the commission, have been engaged in the production of milk theprice of which would be regulated under the proposed order or amendment.
(c) For purposes of any referendum, the commission shallconsider the approval or disapproval by any cooperative association ofproducers, qualified under the provisions of the Act of Congress of February18, 1922, as amended, known as the Capper-Volstead Act [U.S.C.§§ 291 and 292], 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 subdivisions (2) through (5) hereof.
(1) No cooperative which has been formed to act as a commonmarketing agency for both cooperatives and individual producers shall bequalified to block vote for either.
(2) Any cooperative which is qualified to block vote shall,before submitting its approval or disapproval in any referendum, give priorwritten notice to each of its members as to whether and how it intends to castits vote. The notice shall be given in a timely manner, as established, and inthe form prescribed, by the commission.
(3) Any producer may obtain a ballot from the commission inorder to register approval or disapproval of the proposed order.
(4) A producer who is a member of a cooperative which hasprovided notice of its intent to approve or not to approve a proposed order,and who obtains a ballot and with such ballot expresses his or her approval ordisapproval of the proposed order, shall notify the commission as to the nameof the cooperative of which he or she is a member, and the commission shallremove such producer's name from the list certified by such cooperative withits corporate vote.
(5) In order to insure that all milk producers are informedregarding a proposed order, the commission shall notify all milk producers thatan order is being considered and that each producer may register his or herapproval or disapproval with the commission either directly or through his orher cooperative.
Section 14. Termination of over-order price or marketingorder. (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 regulationsestablishing an over-order price or a commission marketing order issued underthis article whenever it finds that such termination is favored by a majorityof the producers who, during a representative period determined by thecommission, have been engaged in the production of milk the price of which isregulated by such order; but such termination shall be effective only ifannounced on or before such date as may be specified in such marketingagreement or order.
(c) The termination or suspension of any order or provisionthereof, shall not be considered an order within the meaning of this articleand shall require no hearing, but shall comply with the requirements forinformal rulemaking prescribed by § 4 of the Federal AdministrativeProcedure Act, as amended (5 U.S.C. § 553.)
ARTICLE VI
ENFORCEMENT
Section 15. Records, reports, access to premises. (a) Thecommission may by rule and regulation prescribe record keeping and reportingrequirements for all regulated persons. For purposes of the administration andenforcement of this compact, the commission is authorized to examine the booksand records of any regulated person relating to his or her milk business andfor that purpose, the commission's properly designated officers, employees, oragents shall have full access during normal business hours to the premises andrecords of all regulated persons.
(b) Information furnished to or acquired by the commissionofficers, employees, or its agents pursuant to this section shall beconfidential and not subject to disclosure except to the extent that thecommission deems disclosure to be necessary in any administrative or judicialproceeding involving the administration or enforcement of this compact, anover-order price, a compact marketing order, or other regulations of thecommission. The commission may promulgate regulations further defining theconfidentiality of information pursuant to this section. Nothing in thissection shall be deemed to prohibit (i) the issuance of general statementsbased upon the reports of a number of handlers, which do not identify theinformation furnished by any person, or (ii) the publication by direction ofthe commission 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 shallintentionally disclose information, by inference or otherwise, which is madeconfidential pursuant to this section. Any person violating the provisions ofthis section shall upon conviction be subject to a fine of not more than onethousand dollars ($1,000) or to imprisonment for not more than one year, or toboth, and shall be removed from office. The commission shall refer anyallegation of a violation of this section to the appropriate state enforcementauthority or United States Attorney.
Section 16. Subpoena, hearings and judicial review. (a) Thecommission is hereby authorized and empowered by its members and its properlydesignated officers to administer oaths and issue subpoenas through out allsignatory states to compel the attendance of witnesses and the giving oftestimony and the production of other evidence.
(b) Any handler subject to an order may file a writtenpetition with the commission stating that any such order or any provision ofany such order or any obligation imposed in connection therewith is not inaccordance with law and praying for a modification thereof or to be exemptedtherefrom. He or she shall thereupon be given an opportunity for a hearing uponsuch petition, in accordance with regulations made by the commission. Aftersuch hearing, the commission shall make a ruling upon the prayer of suchpetition which shall be final, if in accordance with law.
(c) The district courts of the United States in any districtin which such handler is an inhabitant, or has his or her principal place ofbusiness, are hereby vested with jurisdiction in equity to review such ruling,provided a bill in equity for that purpose is filed within thirty (30) daysfrom the date of entry of such ruling. Service of process in such proceedingsmay be had upon the commission by delivering to it a copy of the bill ofcomplaint. If the court determines that such ruling is not in accordance withlaw, it shall remand such proceedings to the commission with directions either(1) to make such ruling as the court shall determine to be in accordance withlaw, or (2) to take such further proceedings as, in its opinion, the lawrequires. The pendency of proceedings instituted pursuant to this subsectionshall not impede, hinder, or delay the commission from obtaining reliefpursuant to subsection 18. Any proceedings brought pursuant to § 18(except where brought by way of counterclaim in proceedings instituted pursuantto this section) shall abate whenever a final decree has been rendered inproceedings between the same parties, and covering the same subject matter,instituted pursuant to this section.
Section 17. Enforcement with respect to handlers. (a) Anyviolation by a handler of the provisions of regulations establishing anover-order price or a commission marketing order, or other regulations adoptedpursuant to this compact shall:
(1) Constitute a violation of the laws of each of thesignatory states. Such violation shall render the violator subject to a civilpenalty in an amount as may be prescribed by the laws of each of theparticipating states, recoverable in any state or federal court of competentjurisdiction. Each day such violation continues shall constitute a separateviolation.
(2) Constitute grounds for the revocation of license orpermit to engage in the milk business under the applicable laws of theparticipating states.
(b) With respect to handlers, the commission shall enforcethe provisions 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 reliefbrought in the name of the commission in any state or federal court ofcompetent jurisdiction; or
(2) With the agreement of the appropriate state agency of aparticipating state, by referral to the state agency for enforcement byjudicial or administrative remedy.
(c) With respect to handlers, the commission may bring anaction for injunction 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
Section 18. Finance of start-up and regular costs. (a) Toprovide for its start-up costs, the commission may borrow money pursuant to itsgeneral power under § 6 (d)(4). In order to finance the costs ofadministration and enforcement of this compact, including pay back of start-upcosts, the commission is hereby empowered to collect an assessment from eachhandler who purchases milk from producers within the region. The initialassessment may apply to the projected purchases of handlers for the two (2)month period following the date the commission convenes. If imposed, thisassessment shall be collected on a monthly basis for up to one (1) year fromthe date the commission convenes, in an amount not to exceed one-tenth of onepercent (0.1%) of the applicable federal milk marketing order blend price perhundred weight of milk purchased from producers during the period of theassessment. In addition, if regulations establishing an over-order price or acompact marketing order are adopted, they may include an assessment for thespecific purpose of their administration. These regulations shall provide forestablishment of a reserve for the commission's ongoing operating expenses.
(b) The commission shall not pledge the credit of anyparticipating state or of the United States. Notes issued by the commission andall other financial obligations incurred by it, shall be its soleresponsibility and no participating state or the United States shall be liabletherefor.
Section 19. Audit and accounts. (a) The commission shall keepaccurate accounts of all receipts and disbursements, which shall be subject tothe audit and accounting procedures established under its rules. In addition,all receipts and disbursements of funds handled by the commission shall beaudited yearly by a qualified public accountant and the report of the auditshall be included in and become part of the annual report of the commission.
(b) The accounts of the commission shall be open at anyreasonable time for inspection by duly constituted officers of theparticipating states and by any persons authorized by the commission.
(c) Nothing contained in this article shall be construed toprevent commission compliance with laws relating to audit or inspection ofaccounts by or on behalf of any participating state or of the United States.
ARTICLE VIII
ENTRY INTO FORCE – ADDITIONAL MEMBERS ANDWITHDRAWAL
Section 20. Entry into force – Additional members. Thecompact shall enter into force effective when enacted into law by any three (3)states of the group of states composed of Connecticut, Delaware, Maine,Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania,Rhode Island, Vermont, and Virginia, and when the consent of congress has beenobtained. This compact shall also be open to states which are contiguous to anyof the named states and open to states which are contiguous to participatingstates.
Section 22. Withdrawal from compact. Any participating statemay withdraw from this compact by enacting a statute repealing the same, but nosuch withdrawal shall take effect until one (1) year after notice in writing ofthe withdrawal is given to the commission and the governors of all otherparticipating states. No withdrawal shall affect any liability already incurredby or chargeable to a party state prior to the time of such withdrawal.
Section 23. Severability. If any part or provision of thiscompact is adjudged invalid by any court, such judgment shall be confined inits operation to the part or provision directly involved in the controversy inwhich such judgment shall have been rendered and shall not affect or impair thevalidity of the remainder of this compact.
§ 2-24-1 Ratification of compact –Text. – The governor having entered on behalf of this state into a compact,substantially in the following form, with one or more of the states ofConnecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, NewJersey, New York, Pennsylvania, Vermont and Virginia and with any other statesof the United States or provinces of the Dominion of Canada as may have legallyjoined in this compact, the legislature signifies its approval and ratificationof the compact entered into, as to any of those states or provinces that mayhave or may hereafter legally join in the compact:
ARTICLE I
STATEMENT OF PURPOSE, FINDINGS AND DECLARATION OFPOLICY
Section 1. Statement of purpose, findings and declaration ofpolicy. The purpose of this compact is to recognize by constitutionalprerequisite the interstate character of the northeast dairy industry and toform an interstate commission for the northeast region. The mission of thecommission is to take such steps as are necessary to assure the continuedviability of dairy farming in the northeast, and to assure consumers of anadequate, local supply of pure and wholesome milk.
In today's regional dairy marketplace, cooperative, ratherthan individual state action may address more effectively the market disarray.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.
In establishing their constitutional regulatory authorityover the region's fluid milk market by this compact, the participating statesdeclare their purpose that this compact neither displace the federal ordersystem nor encourage the merging of federal orders. Specific provisions of thecompact itself set forth this basic principle.
Designed as a flexible mechanism able to adjust to changes ina regulated marketplace, the compact also contains a contingency provisionshould the federal 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.
Recent, dramatic price fluctuations, with a pronounceddownward trend, threaten the viability and stability of the northeast dairyregion. Historically, individual state regulatory action has been an effectiveemergency remedy available to farmers confronting a distressed market. Thefederal order system, implemented by the Agricultural Marketing Agreement Actof 1937 [7 U.S.C. § 601 et seq.], establishes only minimumprices for dairy products, without preempting the power of states to regulatemilk prices above the minimum levels so established. Based on this authority,each state in the region has individually attempted to implement at least oneregulatory program in response to the current dairy industry crisis.
The participating states find and declare that the dairyindustry is the paramount agricultural activity of the northeast. Dairy farms,and associated suppliers, marketers, processors and retailers, are an integralcomponent of the region's economy. Their ability to provide a stable, localsupply of pure, wholesome milk is a matter of great importance to the healthand welfare of the region.
The participating states further find that dairy farms areessential to the region's rural communities and character. The farms preserveopen spaces, sculpt the landscape and provide the land base for a diversity ofrecreational pursuits. In defining the rural character of our communities andlandscape, dairy farms also provide a major draw for our tourist industries.
By entering into this compact, the participating statesaffirm that their ability to regulate the price which northeast dairy farmersreceive for their product is essential to the public interest. Assurance of afair and equitable price for dairy farmers ensures their ability to providemilk to the market and the vitality of the northeast dairy industry, with allthe associated benefits.
ARTICLE II
DEFINITIONS AND RULES OF CONSTRUCTION
Section 2. Definitions. For the purpose of this compact, andof any supplemental or concurring legislation enacted pursuant thereto, exceptas may be otherwise required by the context:
(1) "Commission" means the commission established by thiscompact.
(2) "Compact" means this interstate compact.
(3) "Region" means the territorial limits of the states whichare or become parties to this compact.
(4) "Participating state" means a state which has become aparty to this compact by the enactment of concurring legislation.
(5) "Regulated area" means any area within the regiongoverned by and defined in regulations establishing a compact over-order priceor commission marketing order.
(6) "Pool plant" means any milk plant located in a regulatedarea.
(7) "Partially regulated plant" means a milk plant notlocated in a regulated area but having Class I distribution within such area,or receipts from producers located in such area. Commission regulations mayexempt plants having such distribution or receipts in amounts less than thelimits defined therein.
(8) "Compact over-order price" means a minimum price requiredto be paid to producers for Class I milk established by the commission inregulations adopted pursuant to sections ten and eleven of this compact, whichis above the price established in federal marketing orders or by state farmprice regulation in the regulated area. Such price may apply throughout theregion or in any part or parts thereof as defined in the regulations of thecommission.
(9) "Commission marketing order" means regulations adopted bythe commission pursuant to sections ten and eleven of this compact in place ofa terminated 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 for anyor all classes of milk.
(10) "Milk" means the lacteal secretion of cows and includesall skim, butterfat, or other constituents obtained from separation or anyother process. The term is used in its broadest sense and may be furtherdefined by the commission for regulatory purposes.
(11) "Class I milk" means milk disposed of in fluid form oras a fluid milk product, subject to further definition in accordance with theprinciples expressed in subdivision (b) of § 3.
(12) "State dairy regulation" means any state regulation ofdairy prices, and associated assessments, whether by statute, marketing orderor otherwise.
Section 3. Rules of construction. (a) This compact shall notbe construed to displace existing federal milk marketing orders or state dairyregulation in the region but to supplement them. In the event some or allfederal orders in the region are discontinued, the compact shall be construedto provide the commission the option to replace them with one or morecommission marketing orders pursuant to this compact.
(b) This compact shall be construed liberally in order toachieve the purposes and intent enunciated in section one. It is the intent ofthis compact 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 to affordthe commission broad flexibility to devise regulatory mechanisms to achieve thepurposes of this compact. In accordance with this intent, the technical termswhich are associated with market order regulation and which have acquiredcommonly understood general meanings are not defined herein but the commissionmay further define the terms used in this compact and develop additionalconcepts and define additional terms as it may find appropriate to achieve itspurposes.
ARTICLE III
COMMISSION ESTABLISHED
Section 4. Commission established. There is hereby created acommission to administer the compact, composed of delegations from each statein the region. A delegation shall include not less than three (3) nor more thanfive (5) persons. Each delegation shall include at least one (1) dairy farmerwho is engaged in the production of milk at the time of appointment orreappointment and one (1) consumer representative. Delegation members shall beresidents and voters of, and subject to such confirmation process as providedin, the appointing state. Delegation members shall serve no more than three (3)consecutive terms, with no single term of more than four (4) years, and besubject to removal for cause. In all other respects, delegation members shallserve in accordance with the laws of the state represented. The compensation,if any, of the members of a state delegation shall be determined and paid byeach state, but their expenses shall be paid by the commission. Each statedelegation shall be entitled to one (1) vote in the conduct of the commission'saffairs.
Section 5. Voting requirements. All actions taken by thecommission, except for the establishment or termination of an over-order priceor commission marketing order, and the adoption, amendment or rescission of thecommission's by-laws, shall be by majority vote of the delegations present.Establishment or termination of an over-order prices or commission marketingorder shall require at least a two-thirds (2/3) vote of the delegationspresent. The establishment of a regulated area which covers all or part of aparticipating state shall require also the affirmative vote of the state'sdelegation. A majority of the delegations from the participating states shallconstitute a quorum of the conduct of the commission's business.
Section 6. Administration and management. (a) The commissionshall elect annually from among the members of the participating statedelegations a chairperson, a vice-chairperson, and a treasurer. The commissionshall appoint an executive director and fix his or her duties and compensation.The executive director shall serve at the pleasure of the commission, and,together with the treasurer, shall be bonded in an amount determined by thecommission. The commission may establish through its by-laws an executivecommittee composed of one (1) member elected by each delegation.
(b) The commission shall adopt by-laws for the conduct of itsbusiness by a two-thirds (2/3) vote and shall have the power by the same voteto amend and rescind these by-laws. The commission shall publish its by-laws inconvenient form with the appropriate agency or officer in each of theparticipating states. The by-laws shall provide for appropriate notice to thedelegations of all commission meetings and hearings and of the business to betransacted at such meetings or hearings. Notice also shall be given to otheragencies or officers of participating states as provided by the laws of thosestates.
(c) The commissions shall file an annual report with thesecretary of agriculture of the United States, and with each of theparticipating states by submitting copies to the governor, both houses of thelegislature, and the head of the state department having responsibilities foragriculture.
(d) In addition to the powers and duties elsewhere prescribedin this compact, 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 personalproperty by gift, purchase, lease, license, or other similar manner, for itscorporate purposes;
(4) To borrow money and to issue notes, to provide for therights of the holders thereof and to pledge the revenue of the commission assecurity therefor, subject to the provisions of § 18 of this compact;
(5) Appoint such officers, agents, and employees as it maydeem necessary, prescribe their powers, duties, and qualifications; and
(6) To create and abolish such offices, employments, andpositions as it deems necessary for the purposes of their compact and providefor the removal, term, tenure, compensation, fringe benefits, pension, andretirement rights of these officers and employees. The commission may alsoretain personal services on a contract basis.
Section 7. Rule-making power. In addition to the power topromulgate a compact over-order price or commission marketing orders asprovided by this compact, the commission is further empowered to make andenforce such additional rules and regulations as it deems necessary toimplement any provisions of this compact, or to effectuate in any other respectthe purposes of this compact.
ARTICLE IV
POWERS OF THE COMMISSION
Section 8. Powers to promote regulatory uniformity,simplicity and interstate cooperation. The commission is hereby empowered to:
(1) Investigate or provide for investigations or researchprojects designed to review the existing laws and regulations of theparticipating states, to consider their administration and costs, to measuretheir impact on the production and marketing of milk and their effects on theshipment of milk and milk products within the region.
(2) Prepare and transmit to the participating states modeldairy laws and regulations dealing with the inspection of farms and plants,sanitary codes, labels for dairy products and their imitations, standards fordairy products, license standards, producer security programs, and fair tradelaws.
(3) Study and recommend to the participating states joint orcooperative programs for the administration of the dairy laws and regulationsand to prepare estimates of cost savings and benefits of such programs.
(4) Encourage the harmonious relationships between thevarious elements in the industry for the solution of their material problems.Conduct symposiums or conferences designed to improve industry relations, or abetter understanding of problems.
(5) Prepare and release periodic reports on activities andresults of the commission's efforts to the participating states.
(6) Review the existing marketing system for milk and milkproducts and recommend changes in the existing structure for assembly anddistribution of milk which may assist, improve, or promote more efficientassembly and distribution of milk.
(7) Investigate costs and charges for producing, hauling,handling, processing, distributing, selling and for all other servicesperformed with respect to milk.
(8) Examine current economic forces affecting producers,probable trends in production and consumption, the level of dairy farm pricesin relation to costs, the financial conditions of dairy farmers, and the needfor an emergency order to relieve critical conditions on dairy farms.
Section 9. Equitable farm prices. (a) The power granted inthis section and § 10 shall apply only to the establishment of a compactover-order price, so long as federal milk marketing orders remain in effect inthe region. In the event that any or all such orders are terminated, thisarticle shall authorize the commission to establish one (1) or more commissionmarketing orders, as herein provided, in the region or parts thereof as definedin the order.
(b) A compact over-order price established pursuant to thissection shall apply only to class I milk. Such over-order price shall notexceed one dollar fifty cents ($1.50) per gallon. Beginning in 1990, and usingthat year as a base, the foregoing one dollar fifty cents ($1.50) per gallonmaximum shall be adjusted annually by the rate of change in the consumer priceindex as reported by the bureau of labor statistics of the United Statesdepartment of labor. For purposes of the pooling and equalization of anover-order price, the value of milk used in other use classifications shall becalculated at the appropriate class price established pursuant to theapplicable federal order or state dairy regulation and the value of unregulatedmilk shall be calculated in relation to the nearest prevailing class price inaccordance with and subject to such adjustments as the commission may prescribein regulations.
(c) A commission marketing order shall apply to all classesand uses of milk.
(d) The commission is hereby empowered to establish theminimum price for milk to be paid by pool plants, partially regulated plantsand all other handlers receiving milk from producers located in a regulatedarea. This price shall be established either as a compact over-order price orby one (1) or more commission marketing orders. Whenever such a price has beenestablished by either type of regulation, the legal obligation to pay suchprice shall be determined solely by the terms and purpose of the regulationwithout regard to the situs of the transfer of title, possession or any otherfactors not related to the purposes of the regulation and this compact.Producer-handlers as defined in an applicable federal milk marketing ordershall not be subject to a compact over-order price. The commission shallprovide for similar treatment of producer-handlers under commission marketingorders.
(e) In determining the price, the commission shall considerthe balance between production and consumption of milk and milk products in theregulated area, the costs of production including, but not limited to the priceof feed, the cost of labor including the reasonable value of the producer's ownlabor and management, machinery expense, and interest expense, the prevailingprice for milk outside the regulated area, the purchasing power of the publicand the price necessary to yield a reasonable return to the producer anddistributor.
(f) When establishing a compact over-order price, thecommission shall take such action as necessary and feasible to ensure that theover-order price does not create an incentive for producers to generateadditional supplies of milk.
(g) The commission shall whenever possible enter intoagreements with state or federal agencies for exchange of information orservices for the purpose of reducing regulatory burden and cost ofadministering the compact. The commission may reimburse other agencies for thereasonable cost of providing these services.
Section 10. Optional provisions for pricing order.Regulations establishing a compact over-order price or a commission marketingorder may contain, but shall not be limited to, any of the following:
(1) Provisions classifying milk in accordance with the formin which or purpose for which it is used, or creating a flat pricing program.
(2) With respect to a commission marketing order only,provisions establishing or providing a method for establishing separate minimumprices for each use classification prescribed by the commission, or a singleminimum price for milk purchased from producers or associations of producers.
(3) With respect to an over-order minimum price, provisionsestablishing or providing a method for establishing such minimum price forclass I milk.
(4) Provisions for establishing either an over-order price ora commission 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 and forcompetitive credits with respect to regulated handlers who market outside theregulated area.
(5) Provisions for the payment to all producers andassociations of producers delivering milk to all handlers of uniform prices forall milk so delivered, irrespective of the uses made of such milk by theindividual handler to whom it is delivered, or for the payment of producersdelivering milk to the same handler of uniform prices for all milk delivered bythem.
(A) With respect to regulations establishing a compactover-order price, the commission may establish one (1) equalization pool withinthe regulated area for the sole purpose of equalizing returns to producersthroughout the regulated area.
(B) With respect to any commission marketing order, asdefined in § 2, which replaces one (1) or more terminated federal ordersor state dairy regulation, the marketing area of now separate state or federalorders shall not be merged without the affirmative consent of each state,voting through its delegation, which is partly or wholly included within anysuch new marketing area.
(6) Provisions, requiring persons who bring class I milk intothe regulated area to make compensatory payments with respect to all such milkto the 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 paid to producers for such milk in thestate of production by a federal milk marketing order or state dairy regulationand the Class I price established by the compact over-order price or commissionmarketing order.
(7) Provisions specially governing the pricing and pooling ofmilk handled by partially regulated plants.
(8) Provisions requiring that the account of any personregulated under a compact over-order price shall be adjusted for any paymentsmade to or received by such persons with respect to a producer settlement fundof any federal or state milk marketing order or other state dairy regulationwithin the regulated area.
(9) Provisions requiring the payment by handlers of anassessment to cover the costs of the administration and enforcement of suchorder pursuant to article VII, § 18(a).
(10) Provision for reimbursement to participants of theWomen, Infants and Children Special Supplemental Food Program of the UnitedStates Child Nutrition Act of 1966 [42 U.S.C. § 1771 et seq.].
(11) Other provisions and requirements as the commission mayfind are necessary or appropriate to effectuate the purposes of this compactand to provide for the payment of fair and equitable minimum prices toproducers.
ARTICLE V
RULEMAKING PROCEDURE
Section 11. Rulemaking procedure. Before promulgation of anyregulations establishing a compact over-order price or commission marketingorder, including any provision with respect to milk supply under § 9(f) oramendment thereof, as provided in article IV, the commission shall conduct aninformal rulemaking proceeding to provide interested persons with anopportunity to present data and views. Such rulemaking proceeding shall begoverned by § 4 of the federal administrative procedures act, as amended(5 U.S.C. § 553). In addition, the commission shall, to the extentpracticable, publish notice of rulemaking proceedings in the official registerof each participating state. Before the initial adoption of regulationsestablishing a compact over-order price or a commission marketing order andthereafter before any amendment with regard to prices or assessments, thecommission shall hold a public hearing. The commission may commence arulemaking proceeding on its own initiative or may in its sole discretion actupon the petition of any person including individual milk producers, anyorganization of milk producers or handlers, general farm organizations,consumer or public interest groups, and local, state or federal officials.
Section 12. Findings and referendum. (a) In addition to theconcise general statement of basis and purpose required by § 4(b) of thefederal administrative procedures act, as amended (5 U.S.C. § 553(c)), thecommission shall make findings of fact with respect to:
(1) Whether the public interest will be served by theestablishment of minimum milk prices to dairy farmers under article IV.
(2) What level of prices will assure that producers receive aprice sufficient 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 thanthose fixing minimum milk prices, are in the public interest and are reasonablydesigned to achieve the purposes of the order.
(4) Whether the terms of the proposed regional order oramendment are approved by producers as provided in § 13.
Section 13. Producer referendum. (a) For the purpose ofascertaining whether the issuance or amendment of regulations establishing acompact over-order price or a commission marketing order, including anyprovision with respect to milk supply under § 9(f) is approved byproducers, the commission shall conduct a referendum among producers. Thereferendum shall be held in a timely manner, as determined by regulation of thecommission. The terms and conditions of the proposed order or amendment shallbe described by the commission in the ballot used in the conduct of thereferendum, but the nature, content, or extent of such description shall not bea basis for attacking the legality of the order or any action relating thereto.
(b) An order or amendment shall be deemed approved byproducers if the commission determines that it is approved by at leasttwo-thirds (2/3) of the voting producers who, during a representative perioddetermined by the commission, have been engaged in the production of milk theprice of which would be regulated under the proposed order or amendment.
(c) For purposes of any referendum, the commission shallconsider the approval or disapproval by any cooperative association ofproducers, qualified under the provisions of the Act of Congress of February18, 1922, as amended, known as the Capper-Volstead Act [U.S.C.§§ 291 and 292], 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 subdivisions (2) through (5) hereof.
(1) No cooperative which has been formed to act as a commonmarketing agency for both cooperatives and individual producers shall bequalified to block vote for either.
(2) Any cooperative which is qualified to block vote shall,before submitting its approval or disapproval in any referendum, give priorwritten notice to each of its members as to whether and how it intends to castits vote. The notice shall be given in a timely manner, as established, and inthe form prescribed, by the commission.
(3) Any producer may obtain a ballot from the commission inorder to register approval or disapproval of the proposed order.
(4) A producer who is a member of a cooperative which hasprovided notice of its intent to approve or not to approve a proposed order,and who obtains a ballot and with such ballot expresses his or her approval ordisapproval of the proposed order, shall notify the commission as to the nameof the cooperative of which he or she is a member, and the commission shallremove such producer's name from the list certified by such cooperative withits corporate vote.
(5) In order to insure that all milk producers are informedregarding a proposed order, the commission shall notify all milk producers thatan order is being considered and that each producer may register his or herapproval or disapproval with the commission either directly or through his orher cooperative.
Section 14. Termination of over-order price or marketingorder. (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 regulationsestablishing an over-order price or a commission marketing order issued underthis article whenever it finds that such termination is favored by a majorityof the producers who, during a representative period determined by thecommission, have been engaged in the production of milk the price of which isregulated by such order; but such termination shall be effective only ifannounced on or before such date as may be specified in such marketingagreement or order.
(c) The termination or suspension of any order or provisionthereof, shall not be considered an order within the meaning of this articleand shall require no hearing, but shall comply with the requirements forinformal rulemaking prescribed by § 4 of the Federal AdministrativeProcedure Act, as amended (5 U.S.C. § 553.)
ARTICLE VI
ENFORCEMENT
Section 15. Records, reports, access to premises. (a) Thecommission may by rule and regulation prescribe record keeping and reportingrequirements for all regulated persons. For purposes of the administration andenforcement of this compact, the commission is authorized to examine the booksand records of any regulated person relating to his or her milk business andfor that purpose, the commission's properly designated officers, employees, oragents shall have full access during normal business hours to the premises andrecords of all regulated persons.
(b) Information furnished to or acquired by the commissionofficers, employees, or its agents pursuant to this section shall beconfidential and not subject to disclosure except to the extent that thecommission deems disclosure to be necessary in any administrative or judicialproceeding involving the administration or enforcement of this compact, anover-order price, a compact marketing order, or other regulations of thecommission. The commission may promulgate regulations further defining theconfidentiality of information pursuant to this section. Nothing in thissection shall be deemed to prohibit (i) the issuance of general statementsbased upon the reports of a number of handlers, which do not identify theinformation furnished by any person, or (ii) the publication by direction ofthe commission 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 shallintentionally disclose information, by inference or otherwise, which is madeconfidential pursuant to this section. Any person violating the provisions ofthis section shall upon conviction be subject to a fine of not more than onethousand dollars ($1,000) or to imprisonment for not more than one year, or toboth, and shall be removed from office. The commission shall refer anyallegation of a violation of this section to the appropriate state enforcementauthority or United States Attorney.
Section 16. Subpoena, hearings and judicial review. (a) Thecommission is hereby authorized and empowered by its members and its properlydesignated officers to administer oaths and issue subpoenas through out allsignatory states to compel the attendance of witnesses and the giving oftestimony and the production of other evidence.
(b) Any handler subject to an order may file a writtenpetition with the commission stating that any such order or any provision ofany such order or any obligation imposed in connection therewith is not inaccordance with law and praying for a modification thereof or to be exemptedtherefrom. He or she shall thereupon be given an opportunity for a hearing uponsuch petition, in accordance with regulations made by the commission. Aftersuch hearing, the commission shall make a ruling upon the prayer of suchpetition which shall be final, if in accordance with law.
(c) The district courts of the United States in any districtin which such handler is an inhabitant, or has his or her principal place ofbusiness, are hereby vested with jurisdiction in equity to review such ruling,provided a bill in equity for that purpose is filed within thirty (30) daysfrom the date of entry of such ruling. Service of process in such proceedingsmay be had upon the commission by delivering to it a copy of the bill ofcomplaint. If the court determines that such ruling is not in accordance withlaw, it shall remand such proceedings to the commission with directions either(1) to make such ruling as the court shall determine to be in accordance withlaw, or (2) to take such further proceedings as, in its opinion, the lawrequires. The pendency of proceedings instituted pursuant to this subsectionshall not impede, hinder, or delay the commission from obtaining reliefpursuant to subsection 18. Any proceedings brought pursuant to § 18(except where brought by way of counterclaim in proceedings instituted pursuantto this section) shall abate whenever a final decree has been rendered inproceedings between the same parties, and covering the same subject matter,instituted pursuant to this section.
Section 17. Enforcement with respect to handlers. (a) Anyviolation by a handler of the provisions of regulations establishing anover-order price or a commission marketing order, or other regulations adoptedpursuant to this compact shall:
(1) Constitute a violation of the laws of each of thesignatory states. Such violation shall render the violator subject to a civilpenalty in an amount as may be prescribed by the laws of each of theparticipating states, recoverable in any state or federal court of competentjurisdiction. Each day such violation continues shall constitute a separateviolation.
(2) Constitute grounds for the revocation of license orpermit to engage in the milk business under the applicable laws of theparticipating states.
(b) With respect to handlers, the commission shall enforcethe provisions 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 reliefbrought in the name of the commission in any state or federal court ofcompetent jurisdiction; or
(2) With the agreement of the appropriate state agency of aparticipating state, by referral to the state agency for enforcement byjudicial or administrative remedy.
(c) With respect to handlers, the commission may bring anaction for injunction 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
Section 18. Finance of start-up and regular costs. (a) Toprovide for its start-up costs, the commission may borrow money pursuant to itsgeneral power under § 6 (d)(4). In order to finance the costs ofadministration and enforcement of this compact, including pay back of start-upcosts, the commission is hereby empowered to collect an assessment from eachhandler who purchases milk from producers within the region. The initialassessment may apply to the projected purchases of handlers for the two (2)month period following the date the commission convenes. If imposed, thisassessment shall be collected on a monthly basis for up to one (1) year fromthe date the commission convenes, in an amount not to exceed one-tenth of onepercent (0.1%) of the applicable federal milk marketing order blend price perhundred weight of milk purchased from producers during the period of theassessment. In addition, if regulations establishing an over-order price or acompact marketing order are adopted, they may include an assessment for thespecific purpose of their administration. These regulations shall provide forestablishment of a reserve for the commission's ongoing operating expenses.
(b) The commission shall not pledge the credit of anyparticipating state or of the United States. Notes issued by the commission andall other financial obligations incurred by it, shall be its soleresponsibility and no participating state or the United States shall be liabletherefor.
Section 19. Audit and accounts. (a) The commission shall keepaccurate accounts of all receipts and disbursements, which shall be subject tothe audit and accounting procedures established under its rules. In addition,all receipts and disbursements of funds handled by the commission shall beaudited yearly by a qualified public accountant and the report of the auditshall be included in and become part of the annual report of the commission.
(b) The accounts of the commission shall be open at anyreasonable time for inspection by duly constituted officers of theparticipating states and by any persons authorized by the commission.
(c) Nothing contained in this article shall be construed toprevent commission compliance with laws relating to audit or inspection ofaccounts by or on behalf of any participating state or of the United States.
ARTICLE VIII
ENTRY INTO FORCE – ADDITIONAL MEMBERS ANDWITHDRAWAL
Section 20. Entry into force – Additional members. Thecompact shall enter into force effective when enacted into law by any three (3)states of the group of states composed of Connecticut, Delaware, Maine,Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania,Rhode Island, Vermont, and Virginia, and when the consent of congress has beenobtained. This compact shall also be open to states which are contiguous to anyof the named states and open to states which are contiguous to participatingstates.
Section 22. Withdrawal from compact. Any participating statemay withdraw from this compact by enacting a statute repealing the same, but nosuch withdrawal shall take effect until one (1) year after notice in writing ofthe withdrawal is given to the commission and the governors of all otherparticipating states. No withdrawal shall affect any liability already incurredby or chargeable to a party state prior to the time of such withdrawal.
Section 23. Severability. If any part or provision of thiscompact is adjudged invalid by any court, such judgment shall be confined inits operation to the part or provision directly involved in the controversy inwhich such judgment shall have been rendered and shall not affect or impair thevalidity of the remainder of this compact.
