Legislation Hits First Policy Deadline

 

Today, May 2, is the deadline for all legislation that has a fiscal impact on the state to move out of policy committee.  Therefore, this last week provides many moments of action on bills that spark controversy.  Here is a short synopsis of activities over the past week on bills impacting agriculture and our related industries:

 

AB 1437 (Mullins) would ban the sale, in California, of a livestock or poultry product if the livestock or poultry was given a medically important antimicrobial for nontherapeutic use.  This conflicts with recent FDA actions.  SB 835 (Hill) would restrict the use of antibiotics in animals for growth promotion and increase veterinary oversight.  The bill was pulled from committee and will not move forward this year.   

 

SB 1381 (Evans) Mandatory Labeling of Foods with GMO ingredients and allows for a private right of action lawsuit suit provision - this bill was referred to the Senate Ag Committee by Senate Rules and was pulled from the Committee just days before it was to be heard.  The bill has a very large and organized coalition in opposition.  The bill will be heard May 12 in Senate Appropriations Committee and will go on to the suspense file.

 

AB 1599 (Holden) would increase enforcement tools and penalties for Inedible Kitchen Grease theft.  This measure was double referred to Assembly Transportation and Ag committees and passed both committees and will be heard in Appropriations Committee next week.  It is supported by CGFA and Pacific Coast Rendering Association.  

 

Other legislation of interest includes AB 1522 (Gonzalez) (mandatory paid sick leave legislation) that has passed committees in the Assembly and is headed to Appropriations Committee. SB 935 (Leno) would raise the minimum wage to $13 an hour and then after 2018 index it to the California Consumer Price Index; it has passed and has been placed on the Appropriations Committee suspense file. 

 

Water Bonds Heard in Policy Committees

 

Three leading water bond bills were up in Water, Parks and Wildlife this week.  They had a special order of business on the bonds.  The committee started with AB 2043 (Bigelow/Conway), then AB 2554 (Rendon) and ended with AB 2686 (Perea).  The committee had agreed to pass all the bills out of committee to continue the negotiations over the water package.    There was strong agriculture support for the Bigelow Conway bill with the association providing lead testimony. Opposition to the bill was raised by the environmental community.  There was little support for Rendon and strong opposition from water, business and agriculture groups.  Perea's bill, AB 2686, had strong support from ag, water, business groups and was amended in committee to include an additional billion dollars for groundwater cleanup in southern California.  

 

SB 1250 (Hueso) was up in Senate Natural Resources and Water.  The bill was heard, had strong support from agriculture, water and business and had some opposition from environmental groups.  Senator Pavley, chair of the Natural Resources and Water Committee had a host of amendments - some Senator Hueso accepted, some he said they can discuss and some he said he did not want to take.  Because the bill is a 2/3 vote bill it is not subject to the timelines.  The Committee members and Author agreed to hold the bill in Committee for a few weeks and sort out the appropriate amendments. 

 

An April 30 hearing on the "state of the livestock industry" before the House Agriculture Committee subcommittee on livestock, rural development and credit provided national producer group witnesses an opportunity to detail the policy and program challenges they believe are hindering their ability to be more profitable.  

 

The lead-off witness was Dr. Joseph Glauber, USDA's chief economist. He took question after question on major issues addressed in industry testimony that followed his testimony.  Subcommittee Chair Eric Crawford (R, AR) questioned Glauber about country of origin labeling (COOL), a perennial target of the industry.  Both agreed there is no direct evidence of consumer benefit in the labeling scheme. Crawford said he's concerned on how COOL affects global livestock/poultry trade, while subcommittee ranking member Rep. Jim Costa (D, CA) said ongoing World Trade Organization (WTO) formal dispute complaints by Mexico and Canada can be catastrophic, especially to states bordering those two countries.

 

Rep. Michael Conaway (D, TX) wanted to know the impact of Brazilian beef imports, asking Glauber what the damage would be to the U.S. industry if imports brought hoof and mouth disease, a state-by-state problem in Brazil.  Glauber said risk analysis studies said imports are safe, but if an outbreak did occur in the U.S. the impact would be substantial, similar to the significant negative impact of the disease in the U.K. in 2007.

 

Bill Roenigk, senior vice president and economist for the National Chicken Council (NCC), said while his industry's net margins - for "surviving companies" - are good, the industry continues to be "frustrated" by an inflexible federal renewable fuels policy and program.  As one of the founding groups of a coalition that's pushed for either repeal or rewrite of the federal Renewable Fuel Standard (RFS), Roenigk's remarks echoed most other livestock industry witnesses.

 

The chicken industry has been stymied in production increases because of what Roenigk called "deep and sustained damage" to chicken production by the RFS, calling it "broken beyond repair."  Since 2006, he said, chicken companies have sustained an additional $44 billion in higher feed costs. He said the "blend wall," food versus fuel, mandates for near-nonexistent cellulosic ethanol and other RFS issues won't go away "until Congress deals with the reality of the unworkable, unsustainable, imbalanced and misnomered (sic) RFS."

 

On the impact of corn ethanol on feed prices - an issue on which the subcommittee is split -- Rep. David Scott (D, GA) was interested in recent reports which contend ethanol is more destructive to the environment than petroleum. Glauber said the ethanol industry is a "vibrant industry," and offers more than just fuel.  Rep. Steve King (R, IA) asked about ethanol byproducts. Glauber explained about half of the refining byproduct is dried distilled grains (DDGs) used for animal feed. Glauber said that while corn prices have risen, current ethanol production has paved the way for other biomass fuels such as grasses and wood chips.

 

Witnesses generally spoke strongly in favor of comprehensive immigration reform, improved rail service and congressional action on propane gas shortages.  On the pending U.S.-European Union (EU) free trade agreement, as well as quick resolution of disputes holding up the Trans-Pacific Partnership (TPP), the industry urged approval of these agreements.  These are "jobs creators" for the industry, resulting in higher domestic production.  Livestock and poultry witnesses also called on Congress to grant President Obama trade promotion authority (TPA).

 

The ongoing western drought was also a hot topic. Rep. Michelle Grisham (D, NM) said she does not know what ranchers can do to maintain production as this drought is entering its fourth year. Glauber recognized the challenge, as the national herd is down five million head with 35% of herds in drought areas. He went on to say this problem will compound itself, as processing plants will begin to close and it will be even harder to get these animals to market.

 

Other industry witnesses included Roger Johnson, National Farmers Union (NFU); Shane Miller, Tyson Fresh Meats; Dr. Howard Hill, NPPC; Michael Smith, Harris Ranch, NCBA; Clint Krebs, American Sheep Industry Assn. (ASIA), and Matthew Cook, National Turkey Federation (NTF).

 

 

A coalition of energy, agriculture and manufacturing industries - "some of the largest customers of rail freight service" - sent House Speaker John Boehner (R, OH) and House Minority Leader Nancy Pelosi (D, CA) a letter this week calling on them to reexamine and modernize federal policies so the rail industry can meet the needs "of the carriers, shippers and the public."

 

Safety was listed as the first priority, with the shippers pointing out they partner with rails to invest billions in upgrades to new and existing rail cars. They also point out the original Staggers Rail Act of 1980 needs to be modernized given freight traffic has doubled and "the economic strength of railroads has greatly improved."

 

But the shippers also pointed out the rail industry has dramatically consolidated in that same period, reducing the number of Class I railroads from 26 in 1980, to just seven today. Calling for policies to improve efficiency and competition among the carriers, the shippers pointed out four carriers dominate the current market and this alone makes it necessary to "reexamine and modernize our regulatory framework."  "This would help ensure that commodities, including grain, coal, fertilizer, steel and manufactured goods can be shipped efficiently to domestic and international markets."

 

The shippers also told the lawmakers they are increasingly held captive to rail carriers, lacking competitive access.  Rail rates have increased dramatically, rising three times as fast as inflation and truck rates, they said, adding that to challenge a rate before the Surface Transportation Board (STB) is "extremely expensive and complex, and particularly burdensome to small businesses."

 

In a call with reporters and a speech to the Mexican American Legal Defense & Educational Fund, Secretary of Agriculture Tom Vilsack said he sees an opening to get comprehensive immigration reform legislation to the President's desk this year.  Vilsack says now that most congressional midterm election primaries are over, it's the time to act.

 

He said all GOP House leaders understand the importance of getting the job done quickly, and they're in lock-step with House Democrat leaders.  The coalition of groups backing immigration reform is broad and diverse, he said, and up until now, the House effort has been blocked by a "small and ever-shrinking minority of people in Congress."

 

House Speaker John Boehner (R, OH) and his lieutenants continue to demand from the Administration assurances that whatever reform bill is passed, the President will enforce it as Congress writes it.  Vilsack said this is a "phony, flimsy excuse" for not acting.  

 

An apple grower from Virginia joined Vilsack on the reporter call saying he's concerned he won't be able to find the 115 workers he needs to harvest his crop, and said this inability to get labor prevents him from expanding his operation.  Phil Glaize, Winchester, VA, said he and other growers have talked with House Judiciary Chair Bob Goodlatte (R, VA) about the need for the immigration bill.

 

Where do things stand on the animal food preventive control proposed rule?

In the last few weeks, you have likely seen a lot of media stories on the U.S. Food and Drug Administration's "reproposal" of the animal food preventive control proposed rule this summer or calls for FDA to exempt certain byproduct categories. This update will provide some clarity on what we know since the comment period closed, as well as what will likely happen this summer.

 

More than 2,100 comments were received on the animal food preventive control proposed rule, with 1,500 of them being form letters received from pet owners, small brewers or farmers that feed spent grains from breweries. That leaves more than 500 "unique" comments from trade associations, companies, consumers and other stakeholders. To date, FDA has only posted 21 of these comments to the public viewing site demonstrating they are way behind on the task. When posted, comments can be found here.

 

A popular bipartisan Senate energy efficiency/conservation bill - supported by more than 80 energy organizations - that supporters believed would pass handily last summer but was derailed by unrelated amendments, looks to be threatened by the amendment curse this year. The bill, authored by Sens. Jean Shaheen (D, NH) and Rob Portman (R, OH), would create a federal program under which buildings - private and government - would receive assistance to retrofit with new technologies to increase energy efficiency.

 

The proposed amendments continued to pile up this week as Senate Majority Leader Harry Reid (D, NV) said he'll try and get agreement on cloture next week in hopes of finishing the bill.  However, which amendments will be accepted and which will get floor votes remains a major process hurdle.

 

Likely not to get the Democrat leadership nod for a vote is an amendment by Sen. John Hoeven (R, ND) and Sen. Mary Landrieu (D, MS) to get the Senate on record approving the Keystone XL pipeline.  Fifty-six Senators have cosponsored a freestanding bill by Hoeven and Landrieu. Negotiations on the Keystone bill continue and will likely be voted on separately from the energy bill.  The White House, which recently ordered another delay to the Department of State's study and recommendation on Keystone, strongly opposes the Hoeven-Landrieu legislation.

 

Sen. David Vitter (R, LA), ranking member of the Senate Environment & Public Works Committee, was the reason the Shaheen-Portman bill was pulled from the floor last September as he worked to add an amendment to the Affordable Care Act (ACA) that would kill special exemptions in the health bill for congressional staff.  He said he'll attempt to offer the health care amendment again.  Hoeven, however, said any deal between the two parties to move the energy bill will not include nongermane amendments.

 

Hoeven also wants a vote on his amendment that would prevent EPA from requiring carbon recapture and sequestration technology at power plants to capture greenhouse gases (GHG) with certain benchmarks.  Sen. John Barasso (R, WY) wants to require the Department of Energy (DOE) to approve liquefied natural gas (LNG) exports to World Trade Organization (WTO) member countries. 

 

The lead Democrat on the House Infrastructure & Transportation Committee says he's confident the conference report on the federal waterways reauthorization will be ready in two weeks.  Rep. Nick Rahall II (D, WVA) said it's now down to how many projects - and which ones - Congress will write into the law as direction to the U.S. Army Corps of Engineers on how to spend their money and where.

 

Also on the table is a long-requested increase in the fuel user fee barge operators pay to help fund waterways projects.  The industry wants the increase, but House and Senate authorizers said only the tax-writing committees can authorize an increase in the fee.  This week, 82 ag shipper and ag producer groups sent a letter to Sen. Ron Wyden (D, OR), chair of the Senate Finance Committee, and ranking minority member Sen. Orrin Hatch (R, UT) urging them to back a 6 to 9-cent increase in the current 20-cent-per-gallon barge fuel tax.  A similar push is planned for the House, where House Ways & Means Committee Chair Dave Camp (R, MI) has introduced a bill to raise the federal user fees on ag shippers to 26 cents.

 

The ag shippers' willingness to pay higher user fees may be looking better all around. Getting that project list in place isn't the only challenge, insiders say, but conferees must then figure out how to pay for them.  Many of the projects being pushed on both sides of the Hill are home state projects in an election year.

 

Also in dispute is a provision in the Senate bill that would create a federal "oceans endowment."  There's no similar language in the House bill and House conferees want to dump the provision.

 

 

 

The five-page NGFA question-and-answer piece, entitled "Legal Obligations and Potential Market Impacts Associated with Biotech-Enhanced Seeds Producing Grain Not Approved for Import into U.S. Export Markets," distills for a producer audience the major findings of the NGFA's economic analysis of the detection of Syngenta Seeds Inc.'s Agrisure Viptera MIR 162 biotechnology-enhanced corn technology in U.S. exports to China starting in mid-November 2013.  It also provides information on the NGFA's analysis of the potential impacts of the launch this year by Syngenta of its Agrisure Duracade 5307 trait.  Both of these analyses were reported in the April 18 edition of the NGFA Newsletter.

 

Further, the NGFA's new publication references the legal obligations and liabilities that apparently apply to producers choosing to plant Agrisure Duracade 5307 corn in 2014, as articulated in Syngenta's Stewardship Agreement with growers.  It also includes information contained in Syngenta's March 11, 2014 open letter to member companies of the NGFA and North American Export Grain Association (NAEGA) concerning Syngenta's views on the liability of grain handlers arising from activities associated with handling Duracade 5307. 

 

The new NGFA publication contains a total of eight questions-and-answers, including several on the importance of the Chinese export market for U.S. corn, soybeans and distillers grains.

 

As noted previously, this publication is being provided as an informational tool for communicating with customers - to be used or not used as each company sees fit.  Importantly, the publication does not constitute advice or recommendations to any segment of the corn value chain.  Each member of the value chain needs to make its own marketplace decisions on the appropriateness of distributing this or other information to producer-customers.  Further, as noted therein, nothing in the NGFA publication should be construed as constituting a recommendation that members of the value chain take joint action of any nature.  In addition, nothing in the publication is intended as legal advice; as always, competent legal counsel should be consulted on legal issues.

 

(Source: National Grain & Feed Association)

 

• Click Here for Copy of Report...

 

 

Attached the CA Agricultural Heritage Club New Inductee application, the Milestone Member application and the sponsorship flyer.

Milestone Member Applicants: Special recognition is given for those who have continued their operation for 125, 150 and 175 years. These families and business entities are the descendants of pioneering agricultural enterprises that produced, sold and transported agricultural commodities during California's formative years.

Please provide information on the enclosed application related to your farm, ranch, agribusiness or agricultural special interest verifying that your agricultural business is currently in operation. It is required to include "copies" of documents to verify your business is currently in operation. Applications must be postmarked no later than Friday, June 6th, 2014 to be eligible for the 2014 California Agricultural Heritage Club Milestone Year.

The California Agricultural Heritage Club Induction Ceremony will be held at the California State Fair on Wednesday, July 16th, 2014 at 9:00 a.m. Milestone inductees will receive two tickets into the fair, two complementary breakfast tickets, and additional tickets can be purchased.

Ag Heritage Club Application: The California Exposition & State Fair is pleased to present the California Agricultural Heritage Club for farms, ranches, agribusiness enterprises and agricultural special interests. The California Agricultural Heritage Club established in 1948 was originally founded as The 100 Year Club. The club's purpose is to identify families, businesses and special agricultural interests that maintain a financial responsibility in agriculture for a century or more. Special recognition is given for those who have continued their operation for 125, 150 and 175 years. These families and business entities are the descendants of pioneering agricultural enterprises that produced, sold and transported agricultural commodities during California's formative years.

Ag Heritage Sponsorship: The California Agricultural Heritage Club is a prestigious group of families and businesses who are descendents of pioneer ranches, farms, and agribusinesses of early California. Their dedication to preserving agriculture's heritage as well as moving the industry forward has made California a proud leader in food production and agriculture.

The club's purpose is to recognize families, businesses, and special interest that have maintained a financial responsibility in agriculture for at least 100 years.  This year inductees and members will be honored on Wednesday, July 16, 2014 at 9:00am at a special breakfast and award presentation.

• 2014 Ag Heritage Application, Milestone Members
• 2014 Ag Heritage Application
• 2014 Ag Heritage Sponsor

Agricultural Regulatory Compliance From The Top Forum    Joint Liability: A New Era for Growers,  Farm Labor Contractors and Processors   Thursday, May 22, 2014 7:30 a.m. - 12:30 p.m.

Harris Ranch Inn and Restaurant  24505 West Dorris Avenue  Coalinga, CA 93210   8:00 a.m.-9:00 a.m. Legislative Update: Focus on FLCs   Louie A. Brown, Jr., Esq.  Kahn, Soares and Conway, LLP     9:00 a.m.-10:00 a.m.   Letter of the Law: Joint Liability and Impacts on   California's Agricultural Labor Paul R. Lynd, Esq.  Nixon Peabody LLP   10:15 a.m.-11:15 a.m.  Regulatory Updates: California Division of Labor Standards and Enforcement  (invited)   11:30 a.m. -12:30 p.m. Partnerships and Perspectives: Collaboratively Working Together on Joint Liability Issues (panel will include representatives from entities including farm labor contractors, growers, processors and legal counsel)   Click Here for Flyer/Registration     Cost:    AgSafe, WAPA, CCGGA, UnitedAg, and CalASFRMA  Members: $40 / Late $60   Non-Members: $60 / Late $90   *Price includes breakfast buffet and materials. *To avoid late fees register a minimum of 5 business days prior to event.