SECTIONS 62700-62731 - California Statutes

FOOD AND AGRICULTURAL CODE

SECTION 62700-62731

62700. The production and distribution of fluid milk and fluid
cream is hereby declared to be a business affected with a public
interest. The provisions of this chapter are enacted in the exercise
of the police powers of this state for the purpose of protecting the
health and welfare of the people of this state.

62701. It is hereby declared that fluid milk and fluid cream are
necessary articles of food for human consumption; that the production
and maintenance of an adequate supply of healthful milk of proper
chemical and physical content, free from contamination, is vital to
public health and welfare, and that the production, transportation,
processing, storage, distribution and sale of fluid milk and fluid
cream in the State of California is an industry, in whole and in
part, affecting public health and welfare; that unfair, unjust,
destructive and demoralizing trade practices have appeared within
this industry and these practices constitute a menace to the health
and welfare of the inhabitants of this state by threatening the
stability of this industry and by thereby endangering the assurance
to the people of the State of California of the maintenance of an
adequate supply of this necessary commodity; that it is a policy of
this state to promote, foster and encourage the intelligent
production and orderly marketing of commodities necessary to its
citizens, including fluid milk and fluid cream, and to eliminate
speculation, waste, improper marketing, unfair and destructive trade
practices, and improper accounting for milk purchased from producers.

62702. It is recognized by the Legislature that currently the
powers conferred upon the director by Chapter 2 (commencing with
Section 61801) are inadequate to enable the dairy industry to develop
and maintain satisfactory marketing conditions and bring about and
maintain a reasonable amount of stability and prosperity in the
production of fluid milk and fluid cream; and that to accomplish
these purposes, and particularly to insure to consumers within
California an adequate and continuous supply of pure, fresh, and
wholesome milk at fair and reasonable prices, including a reasonable
estimate of the additional supply which is needed to provide for
normal fluctuations in production and in consumer demand for those
products, those powers must be supplemented by the powers conferred
in this chapter upon the director to equalize gradually the
distribution of class 1 usage among the producers of this state.

62702.1. It is recognized by the Legislature that the provisions
for equalization of usages among producers and entry of new producers
contained in the Gonsalves Milk Pooling Act, as originally enacted,
and the pooling plan adopted thereunder, tended to achieve the
purposes of that act; however, the provisions for more rapid
equalization and additional new entry would more rapidly and
effectively achieve the purposes of this chapter.
It is also recognized that some holders of pool quota and
production base initially issued under the Gonsalves Milk Pooling Act
have waited for several years for equalization, and that equalized
producers have for a number of years not shared in any of the
benefits of new quota created by new usage.
It is further recognized that it is necessary to promote and to
attempt to assure more rapid equalization of the holders of pool
quota issued subsequent to the initial allocation of production bases
and pool quota pursuant to this chapter, and to provide for a
program for entry and for equalization of new producers.
It is the purpose of the amendments to this chapter to provide a
reasonable and equitable mechanism to permit more accelerated
equalization, to equalize the holders of pool quota and production
base initially issued under the Gonsalves Milk Pooling Act and who
are not yet equalized, and to legislatively allocate in a fair and
reasonable manner a share of new pool quota created by new usage to
existing pool quota holders who are not equalized, to new producers,
and to equalized pool quota holders who have not shared in the
benefits of the growth of new usage since the original enactment of
the Gonsalves Milk Pooling Act and the pooling plan thereunder.

62703. In effectuating the purposes of this chapter, a production
base and a pool quota shall be established for each producer pursuant
to Section 62707. The establishing of these bases and their
functions shall be as provided in the pooling plan formulated by the
director pursuant to the provisions of this chapter.

62704. The director is authorized to develop a proposed pooling
plan and to designate the proposed areas in which the plan will be
made effective. He shall appoint fluid milk producers, and
representatives of producers, to be the members and alternate members
of a formulation committee, reasonably representative of all
producers and areas to be included in the proposed pooling plan,
which committee shall advise and assist the director in the
establishment of the proposed pooling plan area and in the
formulation of the proposed pooling plan. The pooling plan shall
include all areas covered by stabilization and marketing plans under
Chapter 2 (commencing with Section 61801), except any relatively
isolated region of the state may be excluded therefrom, if the
director, after a public hearing, finds that the inclusion of the
region is not practical or in conformity with the purposes of the
pooling plan, or if he finds that the producers in the relatively
isolated region do not desire to be a part of either their own or one
of the pools.

62705. After the director, with the advice and assistance of the
formulation committee, has formulated the proposed plan, he shall
hold one or more public hearings in each proposed pooling area to be
affected by the proposed plan for the purposes of considering
modification of the proposed boundaries and formulating the pooling
plan which will best accomplish the purposes of this chapter. Notice
of the public hearings shall be given to each producer, including
each member of cooperative marketing associations, who ships fluid
milk to a distributor and to each distributor who receives fluid milk
from producers. The procedures for the giving of notice and the
conducting of the hearings shall be the same as those provided in
Chapter 2 (commencing with Section 61801) for public hearings on
stabilization and marketing plans.

62706. The pooling plan shall prescribe the pooling area to be
covered by each pool. Any such pooling area shall mean and include a
large sales and consuming center together with all intermediate and
secondary cities, towns and rural areas, which depend upon and
receive their fluid milk supplies from a common producing and supply
area, and including the fluid milk producers who produce fluid milk
for such sales and consuming area, and including the fluid milk
processing plants which receive, process or distribute the fluid milk
supplies for such an area.
In establishing pool areas the director shall take into
consideration the fact that some producers and processors may
produce, or process and distribute, respectively, fluid milk for more
than one pool area and therefore may qualify for inclusion and
participation in more than one pool. Producers who so qualify for
participation in more than one pool shall be permitted to do so on
the basis of the proportions of their shipments of fluid milk to each
pool area.

62707. The formulation committee shall make recommendations to the
secretary for inclusion in the pooling plan, and the secretary shall
include in the pooling plan, all of the following:
(a) The establishment of one or more pools throughout the state.
(b) (1) The base period to be used in determining the production
and class 1 usage bases of each producer directly affected by the
pooling plan. The base period shall, at the producer's option, be his
or her fluid milk production and usage in the pool area during the
calendar year 1967 on an average daily basis or his or her production
and usage in the pool area during the last six months of 1966 on an
average daily basis.
(2) As to a producer south and east of San Gorgonio Pass, his or
her production base may, at his or her option, be four times his or
her production in the months of December 1966, and January and
February 1967.
(3) If a producer, during any base period, had a valid contract
with a distributor, or as a member of a cooperative association had
an allocation, that provided that the distributor or cooperative
association was required to accept a larger amount of fluid milk from
the producer than the producer actually produced during the period,
on proof satisfactory to the secretary of the contract or allocation,
the producer may, at his or her option, have the amount specified in
the contract or allocation established as his or her production
base.
(c) The establishment of a class 1 usage for each producer, which
shall be the amount of his or her production of fluid milk accounted
for as class 1, and any fluid milk sold for use as class 1 to a
United States military installation but that was not accounted for as
class 1.
(d) The allocation to each producer within any pool of a pool
quota, which, initially, shall be 110 percent of that producer's
class 1 usage, as determined in subdivision (c).
(e) (1) The determination of new class 1 usage and the allocation
of pool quota based thereon in a manner consistent with effectuating
the purposes of this chapter.
(2) All producers who have not reached the equalization point
shall share in the allocation of pool quota on the basis of a formula
that gives substantial weight to each producer's production base,
but that, at the same time, allocates a larger percentage to hardship
cases and low class 1 usage producers.
(3) The allocations shall be made on the basis of each individual
producer, with each cooperative association considered as a single
producer. The cooperative associations of producers shall reassign
any new quota to their own members subject to Section 62710.
(4) Annually, within no more than four months after August 31 of
each year, the pool quota shall be adjusted by each component to
reflect any additional pool quota. Any increase in pool quota shall
be determined from the amount of new class 1 and class 2 solids not
fat usage that developed during the preceding annual period which
exceeded the previous highest identical annual period since the
1988-89 fiscal year.
There shall be no downward adjustment of pool quota below the
quota initially established pursuant to this chapter.
(f) The establishment of production bases and pool quotas for new
fluid milk producers who wish to enter the pooling plan after the
effective date of the plan. The recommendations of the committee
shall be reasonably equitable to both the new producers and to
participating producers and consistent with effectuating the purposes
of this chapter.
(g) The transfer of production bases and pool quotas from one
fluid milk producer to another under conditions so designed as to
prevent abuses in the transfers and to avoid the development of
excessive values for the bases and quotas.
(h) Notwithstanding Section 62711, any provision which may be
necessary to encourage the availability of market milk for those
usages for that class 1 and class 2 milk is mandatory.
(i) Any governmental agency that produces, processes, and consumes
in its own facilities only its own production shall not be a pool
plant. The plant shall operate outside the pool for accounting and
settlement purposes unless the plant notifies the secretary of its
election to participate in the pool. Any production of such a
governmental agency that is transferred or diverted to a pool plant
shall be classified for the purpose of settlement at the class 4a or
class 4b price, whichever is lower.
(j) Any and all other matters necessary and desirable to
effectuate the provisions of this chapter.
The recommendations of the formulation committee and the pooling
plan may provide exceptions from the plan's general application for
individual cases of hardship.

62707.1. (a) The director, on July 1, 1978, shall issue new pool
quota sufficient to bring all holders of production base and pool
quota as of that date (excluding any production base and pool quota
issued pursuant to subdivision (f) of Section 62707), to the
equalization point both on the fat and the solids-not-fat components.
(b) Subsequent to July 1, 1978, all allocations of new class 1
usage determined under subdivision (e) of Section 62707, shall be
made as follows:
(1) Forty percent to producers whose total production base and
pool quota are below the equalization point, to be allocated
according to provisions adopted by the director in the applicable
pooling plan.
(2) Forty percent to producers whose total production base and
pool quota are equal to or above the equalization point, this
allocation to each such producer to be in the same ratio to the total
allocation under this subdivision as that producer's total holdings
of quota bears to the total quota holdings of all equalized
producers.
(3) The remaining 20 percent shall be utilized for new producer
allocations under subdivision (f) of Section 62707, according to the
provisions in the then applicable pooling plan.
The terms "total production and pool quota" and "total quota"
shall for the purposes of this subdivision, include allocations of
production base and pool quota issued pursuant to subdivision (f) of
Section 62707.

62707.2. A person eligible for, but not yet assigned, a production
base or pool quota, or both, pursuant to Section 62707 shall not be
eligible for such a production base or pool quota, or both, unless he
applies for such a production base or pool quota, or both, prior to
January 1, 1971.

62707.5. If a portion of the pool quota of any producer is
transferred, it shall carry with it the same quantity of production
base, except that if the pool quota exceeds the production base, the
pool quota shall carry with it a percentage of production base equal
to the percentage of pool quota which is so transferred. In either
case, the producer making a partial transfer of his pool quota shall
lose a percentage of his production base equal to the percentage of
his pool quota which is so transferred. If a producer transfers his
entire production base to one person, his entire pool quota shall
also be transferred to the recipient of the production base. If a
producer transfers his entire pool quota, his entire production base
shall also be transferred to the recipients of the pool quota in a
percentage equal to the percentage of pool quota received by each.
All transfers of production base and pool quota shall be recorded
by the director in a manner consistent with the purposes of this
chapter. Permanent records shall be maintained by the director of all
transactions in either production base or pool quota.
Any person who purchases or otherwise acquires a producer's
business or a portion of a producer's business prior to the operative
date of the pooling plan shall succeed to that same proportion of
the producer's production base and pool quota.

62707.6. In addition to the quota provided for under paragraph (3)
of subdivision (b) of Section 62707.1, any quota returned to the
director after April 30, 1981, shall be utilized for new producer
allocations under subdivision (f) of Section 62707, according to the
provisions in the then applicable pooling plan.

62708. "Producer-handler" for purposes of this chapter is any
person that is both a producer and a handler of fluid milk or fluid
cream. For the purposes of this chapter, a producer-handler is a
producer in any transaction which involves the delivery of bulk fluid
milk or bulk fluid cream which was produced by him to a handler, or
any nonprofit cooperative association of producers and is a handler
in any transaction which involves the purchase by him of fluid milk
or fluid cream, the pasteurization or packaging of fluid milk or
fluid cream, or the sale or delivery of packaged fluid milk or
packaged fluid cream to any person.
A producer-handler, including partnerships or corporations with
common ownership, where the ownership of the producing entity is
substantially proportionate to the ownership of the handling entity,
shall have the option, at the time of the adoption of the initial
pooling plan under this chapter, to have a production base and pool
quota established as a part of the pooling plan provided for in this
chapter, or to elect to operate entirely outside of the pool for
producer payment purposes. This option is available only in such
cases where the producer-handler on January 1, 1968, exercised
complete and exclusive control over the operation and management of a
plant at which he processes milk received from his own milk
production facilities, except for purchases in bulk or packaged fluid
milk, fluid skim milk or fluid cream which do not exceed an annual
average of 50 gallons per day or 5 percent of his total fluid milk
sales, whichever is greater, and only in such case as the
producer-handler had retail sales for its own account of not less
than 66 2/3 percent of its total class 1 sales.
Any producer-handler electing to be excluded from the pool may at
any later time be admitted to the pool, but with only the production
base and pool quota to which he would have originally been entitled
or his average daily production and class 1 usage during the 12
months preceding his entry into the pool, whichever is less.

62708.1. Any producer-handler who qualified and elected an
exemption under Section 62708 and continued eligibility for such
exemption by complying with the requirements of that section shall be
entitled after January 1, 1978, to continue such exemption provided
that such producer-handler maintains retail sales for his own account
of not less than 50 percent of his total class 1 sales and his
purchases do not exceed 25 percent of his total fluid milk sales,
except that any purchases exceeding 5 percent of such sales shall be
from pool sources.
Any producer-handler qualifying for and electing an exemption
under Section 62708, and maintaining such exemption under Section
62708 and this section, may, after January 1, 1978, elect during the
61-day period of August 1 through September 30 of any year to obtain
a production base and pool quota under Section 62708 and enter the
pool subject to the option provision of Section 62708.5.

62708.5. (a) A producer-handler, for purposes of this chapter,
shall also include, as a separate and distinct category of
producer-handlers, any producer and any handler who purchases or
handles fluid milk or fluid cream produced by this producer if all of
the ownership of the handler and all of the ownership of the
producer is owned by the same person or persons and their ownership
in the producer or handler is at least 95 percent identical for each
person with their ownership in the handler or producer. This
ownership shall not exceed 10 individual persons or owners of
equitable interest in a partnership, corporation, or other legally
constituted business association.
(b) The ownership required by this section may be through a
partnership, corporation, or other legally constituted business
association if the entities are owned by the same person or persons,
and there is at least 95 percent identity of ownership for each
person with their ownership in the handler or producer. For purposes
of this section, a "person" or "persons" includes the spouse, or
other persons of lineal consanguinity of the first or second degree
or collateral consanguinity to the fourth degree, and their spouses,
and includes an adopted child the same as a natural child and kindred
of the half blood equally with those of the whole blood of the owner
and ownerships by persons so related shall be considered single
ownership by one person. For purposes of this section, property
pledged or hypothecated in any manner to others shall be considered
"owned" if equitable ownership with management and control remain
with the producer-handler.
(c) Ownership as provided in this section shall have existed at
the time of the base period selected by the producer under Section
62707 and at all other times thereafter.
(d) Any such producer-distributor may, until August 6, 1969, do
either of the following:
(1) Join and operate wholly within the pool.
(2) Have its entire original production base and pool quota
determined during the base period it selected as a producer pursuant
to Section 62707, established as a part of the pooling plan, and,
nevertheless elect to operate entirely outside of the pool to the
extent authorized by this section.
(e) Any producer-handler who qualifies under this section and
elects to operate outside the pool, to the extent of the authority
granted, shall have the right to make deductions, as follows, from
its own class 1 sales, excluding sales to a handler, whether in bulk
or packaged, before being required to account to the pool:
(1) If it has not sold production base and pool quota subsequent
to February 9, 1977, it may deduct its original quota, and quota
purchased prior to March 1, 1995, plus a daily deduction of 150
pounds of milk fat and 375 pounds of solids not fat.
(2) If it has sold production base and pool quota subsequent to
February 9, 1977, it may only deduct its original pool quota, and
quota purchased prior to March 1, 1995.
(f) The deductions from class 1 sales authorized pursuant to this
section may be made irrespective of the fact that the average class 1
usage in the pool for that month may be less than 100 percent of the
pool quota in that pool.
(g) Any production subject to this section from the
producer-handler selecting this option shall not have the right to
participate in the quota pool, irrespective of the fact that the
producer-handler did not sell all of the quota as class 1, and will
participate in either the base pool or the overbase pool depending
upon whether the total production base of the producer is sufficient
to cover the milk delivered in excess of the class 1 usage exempted
hereunder, otherwise the production in excess of the exempt
producer-handler's own class 1 sales, as defined in this section,
shall be accounted for as overbase milk.
(h) The fact that a producer-handler qualifies as to one of its
milk production operations under this section does not prevent it
from operating on an entirely separate nonqualifying basis (and,
therefore, subject to pooling) at other milk production facilities,
and with other nonqualifying persons at these other milk production
facilities. A producer-handler can neither buy nor sell pool quota
and transfer therewith the option granted under this section, but
this shall not prevent him or her from purchasing or selling pool
quota or production base as otherwise provided in this chapter.
(i) If at any time ownership, as defined in this section, ceases,
the producer-handler shall no longer be eligible for the options in
this section, shall account to the pool as a separate handler, and
shall be entitled to reentry into producer participation in the pool
on the same basis as a producer-handler may under the last paragraph
of Section 62708.

62710. The production base and the pool quota for milk shipped
through a cooperative association shall belong to the individual
producer but shall be assigned to the custody and control of the
cooperative association and the production base and pool quota may be
transferred only in accordance with the articles of incorporation,
bylaws, or marketing agreements of such association. The cooperative
association shall continue to be treated as a single producer, both
for producer payment purposes and for pool settlement purposes.

62711. (a) Except as provided in subdivision (h) of Section 62707,
each producer shall be paid the highest usage for that amount of his
or her fluid milk production that is equal to his or her pool quota
and shall be paid the next highest usage for the difference between
his or her pool quota and his or her production base under the
production pool designated pursuant to this chapter and the lowest
usage for all milk produced in excess of his or her production base
under the overproduction pool designated pursuant to this chapter.
(b) In calculating the pool value, the volume of milk that has
been classified as restricted use market milk shall be credited to
the handler at the class 4a or class 4b price, whichever is lower.

62712. (a) The secretary may require handlers, including
cooperative associations acting as handlers, to make reports at any
intervals and in any detail that he or she finds necessary for the
operation of the pool. The secretary may impose and collect a civil
penalty of one hundred dollars ($100) from any handler or cooperative
association acting as a handler that does not file a report on the
date specified by the secretary pursuant to this subdivision. Any
funds collected pursuant to this subdivision shall be deposited in
the Department of Food and Agriculture Fund and, upon appropriation
by the Legislature, the funds may be expended for the purposes of
this chapter.
(b) For the purposes of enforcing this chapter, the secretary,
through his or her duly authorized representatives and agents, shall
have access to the records of every producer and handler. The
secretary shall have at all times, free and unimpeded access to any
building, yard, warehouse, store, manufacturing facility, or
transportation facility in which any market milk or market milk
product is produced, bought, sold, stored, bottled, handled, or
manufactured.
Any books, papers, records, documents, or reports made to,
acquired by, prepared by, or maintained by the secretary pursuant to
this chapter, which would disclose any information about finances,
financial status, or worth, composition, market share, or business
operations of any producer or handler, excluding information that
solely reflects transfers of production base and pool quota among
producers, is confidential and shall not be disclosed to any person
other than the person from whom the information was received, except
pursuant to the final order of a court with jurisdiction, or as
necessary for the proper determination of any proceeding before the
secretary.
(c) In conjunction with the pools authorized by this chapter, the
secretary may require handlers to make payments into a settlement
fund for fluid milk received and the secretary may provide for the
disbursement of moneys from the settlement fund in the course of
administering the pools. Handlers who have a financial obligation to
the pool resulting from the operation of the pooling plan shall pay
the obligations to the pool manager each month as requested. All of
these moneys shall be deposited in a bank or banks approved by the
secretary, and shall be paid out by the pool manager to handlers who
have pool credits resulting from the operation of the pooling plan.
All financial operations of each pool shall be audited by the
department at least once annually. The secretary may require handlers
to make such deductions from amounts due to producers as he or she
finds are necessary to establish a reserve fund to insure prompt
payment to producers.
(d) The secretary may employ a pool manager to operate each pool
and may permit the pool manager to employ such other necessary
personnel and incur such expenses incidental to the operation of the
pool as the secretary finds are necessary. The pool manager shall
effectuate the purposes of Section 62711 by designating the
percentage of each price class (i.e., classes 1, 2, 3, 4a, and 4b) to
be paid within each pool settlement classification (i.e., quota
pool, production pool, and overproduction pool), and in so doing he
or she shall allocate the highest usage available, first to the quota
pool, next to the production pool, and last to the overproduction
pool.
(e) All pool quotas initially determined pursuant to Section 62707
shall be recognized and shall not in any way be diminished.

62714. After the director has established pools, each distributor
shall report to the director the total receipts from the producers
that are shipping to the distributor and the class 1, class 2, class
3, class 4a, and class 4b usage of the distributor and any other
information determined by the director as necessary to carry out the
operation of the pool.
The director shall have access to, and may enter during business
hours, the premises of any distributor, handler, or producer, or any
place where the books, papers, records, or documents pertaining to
any transaction which relates to the acquisition or disposition of
milk are kept. The director may inspect and copy these books, papers,
records, or documents in any place within the state.

62715. Any individual distributor purchasing milk from a producer
shall continue to have the right to specify quality requirements that
are more stringent than standards set by public regulatory or health
authorities, and to specify these standards in a contract with the
producer, provided that all contract quality requirements by the
distributor are identical as to all producers under contract with
that distributor. The distributor may reject milk for class 1
purposes if it fails to meet these specified standards, and may
continue to reject such milk continuously until it again meets these
standards. Any such rejected milk must be picked up separately from
all other milk, and the contract shall give the producers the
unqualified right to sell this rejected milk to others. In the event
the rejected milk is not sold or used for class 1 purposes, the
producer's pool quota shall be reduced by an amount equal to the
amount of pool quota milk rejected during the period in which it is
rejected. The producer's pool quota shall be restored to its full
amount when all his production meets the specified standards.
The quality standards specified shall be subject to review by the
director, and the purported failure of a producer to meet these
standards shall be subject to impartial laboratory tests or such
other procedures as the director may find necessary to prevent abuse.

62716. Following the required hearing, the director shall submit
the pooling plan to producers concerned for their approval or
disapproval in a statewide referendum.
The approval or disapproval of individual producers voting in this
referendum shall be kept confidential.
Each producer shall have one vote and such vote shall be
individually cast so that there will be no block voting. The director
shall prepare a ballot. The ballot form shall be substantially as
follows:

Ballot

Shall the proposed pooling plan be made effective

Yes ____ No ____

In addition, the ballot shall include a statement of the voter's
total production during the calendar month next preceding the month
of the commencement of the referendum period, where and to whom such
production was sold or otherwise disposed, and the producer's name
and address.
The director may reveal the names of producers whose votes have
been received to both proponents and opponents of the plan.
The referendum shall be set for a period of 60 days. The director
may at his own discretion or upon a proper showing, extend the
referendum for a period not to exceed 30 days.

62717. If the director finds that producers on a statewide basis
have assented in writing to the proposed pooling plan submitted to
them for assent, the director shall place the proposed pooling plan
into effect. The director shall find that producers have assented to
the plan if he finds on a statewide basis that not less than 51
percent of the total number of eligible producers in the state shall
have voted in the referendum and finds one of the following:
(a) Sixty-five percent or more of the total number of eligible
producers who voted in the referendum who produced 51 percent or more
of the total amount of fluid milk produced in the state during the
calendar month next preceding the month of the commencement of the
referendum period by all producers who voted in the referendum
approve the plan.
(b) Fifty-one percent or more of the total number of eligible
producers who voted in the referendum who produced 65 percent or more
of the total amount of fluid milk produced in the state during the
calendar month next preceding the month of the commencement of the
referendum period by all producers who voted in the referendum,
approve the plan.
If the plan is not approved, the director may resubmit the plan,
or submit a new plan, at any time after six months from the date the
director announces the plan was not approved.
The director may amend the plan, after notice and public hearing
has been given in the same manner as is provided in Chapter 2
(commencing with Section 61801) for stabilization and marketing
plans, if he finds that the amendment is necessary to effectuate the
purposes of this chapter. After the hearing, the director, upon his
own motion, may make nonsubstantive amendments to the plan. The
director may make substantive amendments to the plan only if
producers assent to the proposed amendments at a referendum conducted
in the same manner and in the same number as provided for the
referendum approving the pooling plan.
The director may terminate the plan on a statewide basis after
notice and public hearing has been given in the same manner as is
provided in Chapter 2 (commencing with Section 61801) for
stabilization and marketing plans, if he finds that the plan is no
longer in conformity with the standards described in, or will not
tend to effectuate the purposes of, this chapter. The hearing may be
held upon the motion of the director, and shall be held upon receipt
of a petition signed by producers representing not less than 25
percent of the total number of all producers and not less than 25
percent of the total production of all producers.
The director shall submit the termination of the plan on a
statewide basis in a referendum conducted in the same manner as
provided for initial approval of the plan if, after notice and public
hearing has been given in the same manner as is provided in Chapter
2 (commencing with Section 61801) for stabilization and marketing
plans, he finds that a substantial question exists as to whether or
not producers desire the plan to continue and shall submit the plan
for termination upon receipt of a petition requesting termination
signed by producers representing not less than 25 percent of the
total number of all producers and not less than 25 percent of the
total production of all producers. The plan shall be terminated if
termination is favored by the same percentage of producers producing
the same amount of fluid milk as required to initiate the plan.

62718. The pools established shall be administered by the director.
Each distributor shall deduct from moneys owed producers and pay to
the director the amount necessary to cover the cost of administering
the pool plan, but not to exceed two cents ($0.02) per hundredweight
of fluid milk.
The amount of such fee shall be paid to the director on or before
the 30th day following the last day of the month in which such fluid
milk or fluid cream was received.
The director may fix such fee at a lesser amount and may adjust
such fee from time to time.
In the event any distributor fails to pay to the director the fee
provided for in this section on or before the date specified in this
section, the director may add to such unpaid fee an amount not
exceeding 10 percent of such unpaid fee to defray the cost of
enforcing the collection of such unpaid fee. The distributor shall
not be entitled to pass this penalty on to the producer.
All moneys received under the provisions of this section shall be
deposited in the State Treasury to the credit of the Department of
Agriculture Fund.

62719. The director shall, from nominations submitted by producers,
appoint a review board composed of no less than 12 members to advise
him in the administration of the pool plan. The director shall
appoint three members of the first board for a one-year term, three
members for two-year terms, three members for three-year terms, and
three members for four-year terms. Thereafter all appointments shall
be for a term of four years and no member may be appointed to more
than two four-year terms. The board members shall be producers and
not more than three may be producer-managers of associations and not
more than two shall be producer-handlers. The board members shall
give proportionate representation to all areas of the state, with due
regard to the relative production and usage of fluid milk in the
various areas of the state. The director may appoint one additional
member on the board, who shall be a public member. Each member of the
review board shall be paid not less than twenty-five dollars ($25)
or more than thirty-five dollars ($35) per day plus travel expenses,
including expenses for lodging and meals, which are incurred in the
attendance at board meetings or in conducting the business of the
board; all per diem and expenses being subject to approval by the
director.
Upon the director's request, the board shall submit to the
director the names of three or more natural persons, each of whom
shall be a citizen and resident of this state and not a producer,
shipper, or processor nor financially interested in any producer,
shipper, or processor, for appointment by the director as a public
member of the board. The director may appoint one of the nominees as
the public member on the board. If all nominees are unsatisfactory to
the director, the board shall continue to submit lists of nominees
until the director has made a selection. Any vacancy in the office of
the public member of the board shall be filled by appointment by the
director from the nominee or nominees similarly qualified submitted
by the board. The public member of the board shall represent the
interests of the general public in all matters coming before the
board and shall have the same voting and other rights and immunities
as other members of the board.

62719.1. It is hereby declared, as a matter of legislative
determination, that producers appointed to the review board pursuant
to Section 62719 are intended to represent and further the interest
of a particular agricultural industry concerned, and that such
representation and furtherance is intended to serve the public
interest. Accordingly, the Legislature finds that, with respect to
persons who are appointed to such board, the particular agricultural
industry concerned is tantamount to, and constitutes, the public
generally within the meaning of Section 87103 of the Government Code.

62720. No pooling plan formulated pursuant to this chapter shall
restrict the free movement of fluid milk and no pooling plan shall
result in an unequal raw product cost between distributors in the
same marketing areas.

62721. No pooling plan shall control the production of fluid milk
except insofar as may otherwise be specifically authorized in this
chapter.

62722. Pooling plans shall not apply to the production of goats
milk or producer-handlers who produce and sell less than 500 gallons
of fluid milk used for class 1 purposes per day unless they
specifically request entry into the pool at the time of the adoption
of the initial pooling plan for that area. Producers of certified
milk or guaranteed raw milk shall have the option, at the time of the
adoption of the initial pooling plan under this chapter, to be
subject to the plan, and accordingly to have a production base and
pool quota established for the producer, or to be excluded from the
plan.
(a) Any such producer of less than 500 gallons of fluid milk per
day, or any such producer of certified milk, or any such producer of
guaranteed raw milk, electing to be excluded from the plan, may at
any later time be admitted to the pool, but with only the production
base and pool quota to which he or she would have originally been
entitled or his or her existing production and average daily class 1
usage during the 12 months preceding his or her entry into the pool,
whichever is less.
(b) Any producer claiming exemptions from the provision of any
pooling plan by reason of the provisions of Section 62708, 62708.1,
or this section, who loses his or her exemption by failure to meet
the requirements for exemptions set forth in those sections shall
automatically be deemed to have applied for and become a part of a
producer pool on September 1st following any year ended August 31st
during which the director determines he or she is no longer entitled
to exemption, and his or her admittance into such a pool shall be on
the basis of the production base and pool quota calculations as set
forth in those sections.

62723. Unless otherwise defined in this chapter, the definitions
contained in Chapter 2 (commencing with Section 61801) govern the
construction of this chapter.
For the purposes of this chapter, the following definitions shall
apply:
(a) The terms "distributor" and "processor" shall have the same
definition as the term "handler" contained in Section 61826.
(b) "Equalization point" shall mean that point at which pool quota
held is equal to 95 percent of production base held.
(c) "Fluid cream" shall have the same definition as the term
"market cream" contained in Section 61827.
(d) "Fluid milk" shall have the same definition as the term
"market milk" contained in Section 61828.
(e) "Fluid skim milk" shall have the same definition as the term
"market skim milk" contained in Section 61829.

62724. This chapter does not modify the provisions of Chapter 1
(commencing with Section 61301) nor Chapter 2 (commencing with
Section 61801) of this part, except as may be necessary to effect the
purposes of this chapter. If necessary to effect the purposes of
this chapter, the director, in establishing the minimum prices which
shall be paid for fluid milk to producers, may establish minimum
producer prices applicable at the producer's place of production.

62725. The director is authorized to use money in the Department of
Food and Agriculture Fund derived from assessments and fees
collected pursuant to Chapter 2 (commencing with Section 61801), to
the extent necessary to defray the expenses incident to the
formulation and making effective the pooling plan pursuant to this
chapter, if, as soon as sufficient money is available from fees
collected pursuant to this chapter, the amount shall be repaid.

62726. The director is the instrumentality of this state for the
purpose of administering and enforcing the provisions of this chapter
and to execute the legislative intent which is expressed in this
chapter, and is hereby vested with the administrative authority which
is described in this chapter. Notwithstanding other laws to the
contrary, in the event a milk marketing order under the jurisdiction
of the United States Department of Agriculture or other appropriate
federal agency, is created by referendum or under the applicable laws
and procedures relating thereto, in this state or in any
geographical area within this state, the provisions of this chapter
or any part thereof which is in conflict with such federal order, or
which is unnecessary or is a duplication thereof, shall be suspended
in the geographical area covered by and during the existence of such
federal order. The director shall take such steps and procedures as
are necessary to wind up and conclude the administration and
enforcement of the provisions of this chapter, or any part thereof,
prior to the suspension date.

62727. It is the intent of the Legislature that the power conferred
in this chapter shall be liberally construed. The provisions of this
chapter or subsequent amendment are severable. If any section,
subdivision, paragraph, sentence, clause, or phrase of this chapter
should be declared or held unconstitutional or invalid for any
reason, such unconstitutionality or invalidity shall not affect the
validity of any other provision of this chapter. The Legislature
hereby declares that it would have enacted each other such section,
subdivision, paragraph, sentence, clause, or phrase of this chapter
irrespective of the fact that one or more sections, subdivisions,
paragraphs, sentences, clauses, or phrases has been declared
unconstitutional or invalid. Provided further that any such finding
of invalidity or unconstitutionality shall not invalidate, affect or
impair pool quotas and production bases heretofore issued under the
Gonsalves Milk Pooling Act or pooling plan promulgated thereunder.

62728. The director shall terminate any pooling plan in effect in
any marketing area without notice or hearing at any time that there
ceases to be a stabilization and marketing plan in force and effect
in such marketing area, establishing minimum prices to be paid to
producers, unless minimum prices payable by distributors to producers
for fluid milk in such marketing area are subject to a federal milk
marketing agreement or order which is not in conflict with, or in
duplication of, the pooling plan.

62729. The director or his assistants, deputies, agents, or other
employees, are authorized to travel out-of-state in order to carry
out the purposes of this chapter.

62730. Any violation of any provision of this chapter, or any
regulations adopted pursuant to this chapter, shall be punishable,
and shall have the same effect, as a violation of Chapter 2
(commencing with Section 61801).

62731. This chapter shall be known as the Gonsalves Milk Pooling
Act.