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| Upcoming Dates |
October 26, 2016:
CGFA and NGFA Joint Grain Safety Seminar
DoubleTree, Fresno, CA
2017
January 11 - 12, 2017 Grain & Feed Industry Conference Embassy Suites Monterey Bay, CA
April 26 - 29, 2017 CGFA Annual Convention Hyatt Regency Lake Tahoe Resort, Spa & Casino
May 10 - 11, 2017: California Animal Nutrition Conference (CANC)
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Benefits of Belonging to CGFA
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- State & Federal Legislative Advocacy
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Mark your calendar, the 2017 California Animal Nutrition Conference (CANC) is scheduled for May 10 - 11, 2017.
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California State Fair Seeks Heritage Farms
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The California State Fair is embarking on its annual search for farms, ranches and companies that have called California home for 100 years or more.
Building on its legacy of honoring century-old agricultural enterprises, the State Fair now seeks new nominees for its California Agricultural Heritage Club. Any agriculture-related businesses or affiliates, including farms, ranches, equipment dealers, accountants, trade or marketing organizations, irrigation districts and others, may apply for induction. The deadline for applying has been extended to June 10.
Members of the California Agricultural Heritage Club receive a plaque of recognition and a special invitation to the State Fair's annual recognition ceremony for designees.
The 2016 event is scheduled for July 13 at 9 a.m. at the California State Fair grandstand.
The Agricultural Heritage Club dates back to 1948, when the state of California created the "100 Year Club" on the 100th anniversary of gold's discovery. The 100 Year Club was renamed the California Agricultural Heritage Club in 2001, to honor farms, ranches, organizations and agricultural businesses that had been established for 100, 125 or 150 years. In 2010, the club started to recognize businesses that reached the 175-year milestone.
People interested in becoming or nominating a member of the California Agricultural Heritage Club may visit the California State Fair website at www.castatefair.org/ca-agheritage/. For more information, contact Don Callison at 916-263-3636 or dcallison@calexpo.com.
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Alexander Moves to Block DOL Overtime Rule
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The Department of Labor's new overtime rule - more than doubling the exempt salary threshold and potentially making up to 4.2 million additional workers eligible for time-and-a-half overtime compensation - has drawn the attention of a powerful senior Senator who intends to try and block the DOL action.
Sen. Lamar Alexander (R, TN), who chairs the Health, Education, Labor & Pensions Committee (HELP) and is a member of the Appropriations Committee, said this week he'll introduce a resolution of disapproval under the Congressional Review Act (CRA) to block the overtime rule. Such a resolution - which needs a House companion - would most likely draw from President Obama a veto threat. At the same time, federal legislation - S. 2707/HR 4773, the "Protecting Workplace Advancement & Opportunity Act" - has been introduced. The bills would send the overtime rule back to DOL for a more comprehensive economic analysis before implementation can begin. The rule is effective December 1, 2016. Also in the offing is a Senate Appropriations Committee action to add language to the FY2017 Labor-HHS spending bill to stop the rule, but this move would also likely draw a White House veto threat. Opponents of the rule are also expected to mount federal court challenges, using the rule's automatic pay increase provisions as grounds for their action. Critics say DOL's formula for determining such increases are unprecedented and likely falls outside the department's authority. The new overtime pay standard, last updated in 2004, raises from $23,660 to $47,476 the exempt annual salary threshold over which overtime need not be paid. At the same time, the rule increases by 34% the total annual compensation needed to exempt "highly compensated" workers, hiking it to $134,004 per year. Department of Labor (DOL) Secretary Tom Perez said the new rule could increase overall wages paid by $1.2 billion over 10 years, adding the new standard will increase from the current 7% to 35% the number of full-time salaried workers who qualify for overtime. Business groups say some companies will get creative to avoid paying overtime, and some options may erode schedule flexibility and employee morale. Some firms will switch salaried employees to hourly workers, holding those workers to a strict 40-hour work weeks, bringing on part-time employees to cover additional hours. Alternatively, some employers will cut base salaries to avoid paying overtime, and still others will maintain salaried employees, closely monitor hours worked and adjust salaries to account for overtime, reducing benefits and the number of full-time employees to control costs.
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Senate Approves First TSCA Reform in Four Decades, Sends to President
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The first true rewrite of the Toxic Substances Control Act (TSCA) in 40 years came to fruition this week as the Senate finally approved the largely bipartisan Frank R. Lautenberg Chemical Safety for the 21st Century Act, clearing it for President Obama's signature.
The voice vote approval came after Sen. Rand Paul (R, KY) lifted a hold on the bill. Passage of the reform bill was praised by chemical makers, users, environmentalists and food safety groups. TSCA prescribes EPA how will evaluate hazardous chemicals for safety, and how the manufacture, transportation, sale, handling and use of the chemicals will be regulated. Industry likes the bill because the new regulatory system authorized is predictable and science-based. The bill enjoyed largely bipartisan support from its inception, though there were issues which threatened to derail effort, including states' ability to set their own chemical safety laws. States with safety laws on the books prior to April, 2016, can continue to operate under those laws by seeking a federal waiver from the new TSCA requirements. The new law allows EPA to collect information about a chemical before making a determination of use or risk. Improved are protections for proprietary company information and new system under which new chemicals can receive priority review and approval before they go on sale. Also allowed under the new law are use of risk-based safety standards for all new and existing chemicals, with a worst-first approach to priority review; expansion of EPA authority to require companies to submit health and safety data for untested chemicals, while cutting animal testing; new funding for agency implementation of the new law; deadlines for company compliance, and "creation of a more uniform regulatory system to ensure interstate commerce is not unduly burdened, while retaining a significant role for states in ensuring chemical safety."
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Deal on GE Food Labeling "Inching" to Completion
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The chair and ranking member of the Senate Committee on Agriculture have likely spent more time together battling over genetically engineered food labeling than they did debating parts of the 2014 Farm Bill, but such tenacity is yielding more frequent and longer meetings, a dwindling list of differences and the first glimmer of hope a deal is in the offing.
The last issues to be resolved, according to reports, include final language on federal preemption of state laws, the best manner in which to exempt meat and dairy already regulated by USDA and how smaller, regional companies will be handled under the bill. With the July 1 effective date for the Vermont GE labeling law looming, the Coalition for Safe and Affordable Food (CSAF) this week issued a formal challenge to Agriculture Committee Chair Pat Roberts (R, KS) and ranking member Sen. Debbie Stabenow (D, MI) effectively saying, "Enough is enough," an agreement is needed immediately. CSAF co-chairs Chuck Conner, president/CEO of the National Council of Farmer Cooperatives (NCFC), and Pamela Bailey, president/CEO of the Grocery Manufacturers Assn. (GMA), said: "There is simply no more time for a compromise to be reached. The issues are well defined, have been fully debated and now is it is time to get in a room and reach a final deal." The American Feed Industry Assn. (AFIA), an active member of CSAF, said in a message to all 100 Senators this week: "There is no time left to parse words or debate issues when they're as well-defined and vetted as those surrounding federal GE labeling. Sen. Roberts and Sen. Stabenow must sit down immediately, finalize their good faith compromise, communicate that bipartisan agreement to their respective caucuses and get on with the business of final Senate action on a federal standard for GE food labeling." Once a deal is reached, the pressure is on to get at least 60 strong votes in favor of the compromise package, with Roberts charged with collecting at least 40 Republicans and Stabenow expected to deliver at least 20 Democrats. Industry will into a full-court lobbying press so the Senate can approve the package and the House can substitute the Senate bill for its previously approved labeling legislation.
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Senate Swings in to Back Dealers on OSHA Controversy
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Sen. John Hoeven (R, ND) championed the side of fertilizer dealers this week in their battle with OSHA over the agency's decision to impose its Process Safety Management (PSM) standards on retail dealers. Hoeven successfully added language to the Senate's FY20176 Labor-HHS appropriations bill blocking OSHA's action without a formal rulemaking process.
Hoeven said the rule hasn't been implemented yet and nine North Dakota dealers have closed their doors, with others saying they'll close after spring planting. His appropriations language, he said, simply ensures affected stakeholders can weigh in on the rulemaking process.
The OSHA rule, developed in the wake of the West Fertilizer Co. explosion in Texas, imposes much stricter federal restrictions on fertilizer sales, particularly those of anhydrous ammonia, unless retail dealers meet the same restrictions as wholesalers. Hoeven said the rule as currently written would force several dealers to cease selling anhydrous, limiting the amount of nitrogen fertilizer available to farmers.
The Agricultural Retailers Assn. (ARA), the Fertilizer Institute (TFI) and several national farm organizations urged the Senate to block the OSHA administrative move by withholding budget money for the agency to implement its plan. The agency's action on PSM, holding retailers to the same standards as wholesalers, would affect an estimated 3,800 agricultural retailers across the country.
The move to withhold funding pending formal rulemaking comes after the ag coalition was able to insert language in the FY2016 omnibus spending package delaying OSHA implementation until October, 2016. ARA and TFI have also sued the Department of Labor (DOL) for "regulating by memo" and ignoring federal rulemaking procedures.
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House Votes to Put Brakes on Ozone Rule
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Joining the growing list of EPA proposed and final rules the House has moved to either block or kill, the House this week approved a bill that would slow down an agency rulemaking setting new ground-level ozone standards. The vote was 234-177, with seven Democrats joining the GOP in moving to rework the ozone rulemaking.
President Obama said he'll veto the legislation if it reaches his desk. The bill is designed to extend and make more flexible state compliance deadlines so EPA can rework the rule to take into account the costs of the rule as well as prospective human health effects. The bill extends the current "unrealistic" review period for National Ambient Air Quality Standards (NAAQS) from five to 10 years, a move designed to ease the regulatory burden on local communities, states and industry. The bill also streamlines the permitting process, requires compliance guidance to be issued at the time of rule/standard publication, and requires consideration of "public health, welfare, social, economic or energy effects" as listed by EPA's Clean Air Science Advisory Committee before setting or revising a NAAQS. With EPA's proposal of two separate ozone standards in eight years - providing no compliance guidance until March, 2015 on its first ozone rule - several areas of the country are just now coming into compliance or "attainment" with a 2008 ozone standard. Then in October, 2015, EPA issued a second ozone standard, putting states in the position of having to comply with two different standards at the same time. Opponents of the ozone rulemaking contend the most recent standard setting is unnecessary because of the 2008 standard, as well as the fact ozone levels have dropped 30% since 1980. Some parts of the country, they also argue, are natural "ozone zones," areas which will never be in compliance with the standards. Rep. Pete Olson (R, TX), author of the Ozone Standards Implementation Act, explained during floor debate nothing in his bill as approved by the House Energy & Commerce Committee changes any part or EPA authority under the Clean Air Act (CAA). He said the bill takes on the double compliance burden of two separate ozone standards based on listening to state regulators. The bill protects states already on the road to compliance, postponing diversion of state assets from complying with the 2008 standard to meet the new standard that even EPA projects will be met through measures already in place under the CAA.
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What's the Fate of European Roundup?
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A month ago, reports out of the European Union (EU) indicated glyphosate (Roundup) was on an easy path to a multi-year reauthorization of its safe use approval. Then the World Health Organization (WHO) announced a tenuous connection of a single chemical in glyphosate to "probable" cancer. Two weeks ago the European Commission (EC), under heavy political pressure from environmentalists and anti-biotechnology activists, said it could only muster enough support for perhaps a one-year renewal of Europe's most widely used herbicide.
As of this week, the fate of glyphosate is still unsettled, and its current approval runs out June 30. The EC has not been able to get a sufficient majority of EU member nations - enough countries representing 65% of the bloc's population - to approve the renewal. The next EC action is set for June 23-24 - the same days as the United Kingdom's referendum (the "Brexit") on its EU membership - and no one's betting either way on the fate of glyphosate in the EU given Germany has already said it will abstain from the vote. France and Italy have made similar statements, according to media reports. EU farmers are none-too-happy with the EC's inability to handle the renewal, and producer groups across the continent said without glyphosate farm income, as well as safe and quality food production are at risk. They also contend using glyphosate allows no-till production, an environmentally friendly practice. The farmers said they support the European Food Safety Authority (EFSA), which published a positive review and assessment of glyphosate safety. In U.S. news related to the WHO glyphosate cancer determination, the House Science, Space & Technology Committee this week sent a letter to EPA as part of an investigation into whether the agency somehow influenced the WHO glyphosate report, in part because of EPA's posting and almost immediate withdrawal from its website of an internal committee report saying glyphosate is not carcinogenic. Part of the House committee's interest comes from the fact EPA staff participated in both the WHO and EPA reviews of glyphosate, yet the two reports appear to be in conflict. EPA previously told the science committee the posting of its CARC report was a mistake and that the agency's review of glyphosate continues. However, the posting and withdrawal of the report spawned initial committee interest in the broader issue of the respective reviews and glyphosate safety. "Given the apparent contradictions of the CARC (EPA) and IARC (EU) finding for glyphosate...the committee has concerns about the integrity" of the WHO review, the role of EPA officials in that review and how that participation may have influenced the outcome of the EPA study, Reuters reports this week after having seen the House committee letter. The House Agriculture Committee is also looking into not only the glyphosate review process at EPA, but the agency's handling of its review of the safety of atrazine. The agriculture panel wants the agency to explain what steps are necessary to finalize the glyphosate study, which it expected to see in mid-2015. At the same time, the House Appropriations Committee subcommittee on agriculture/FDA, sent a letter to National Institutes of Health (NIH) Administrator Francis Collins seeking information on how an $860,000 NIH grant to WHO factors into the WHO/IARC review of glyphosate. Subcommittee Chair Bob Aderholt (R, AL) wants to know why NIH is partially funding and lending its credibility to WHO's determinations on issues ranging from glyphosate to red meat and the probability of cancer links, particularly since WHO findings are often in conflict with U.S. decisions. Aderholt told Collins, "The...conclusions (by WHO) appear to be the result of a significantly flawed process; unfortunately, because the process was funded through NIH, the conclusions will be taken more seriously than they might have been." The EU has almost routinely renewed the glyphosate approval given supporters of the herbicide point to decades of research and safe use, as well as over 7,000 studies attesting to glyphosate safety. If the glyphosate approval lapses, industry experts predict hundreds of lawsuits against the EC will be filed almost immediately.
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EPA Hears 140 Witnesses at KC RFS Public Meeting; EU Court says EC Ethanol Import Duty Invalid
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The renewable fuels industry this week rallied its troops, sending hundreds of industry witnesses to Kansas City to participate in EPA's first public meeting on the impact of its recently proposed 2017 Renewable Fuel Standard (RFS). The one-day meeting scheduled more than 140 would-be witnesses.
At the same time, the European Union's (EU) General Court this week said the EU's antidumping duty on U.S. ethanol is invalid. While a major victory for the U.S. ethanol industry, the 9.5% duty remains in effect pending an appeal by the European Commission (EC) within the next 60 days. The duty works out to about $83 per ton, and the court said it was invalid because the EC applied a single weighted average duty on all U.S. ethanol production rather than separate duties for each major producer. Most of the witnesses who showed up in Kansas City told the agency they're not crazy about its May proposed RFS renewable volume obligation (RVO) of 18.8 billion gallons for 2017 overall. About 14.8 billion gallons of that total is corn ethanol. That level is either too low given Congress wrote into the law authorizing the RFS that the RVO should be 24 billion gallons generally and 15 billion for corn ethanol, or too high given the ethanol industry's competition with feed and food companies for available corn. At the lower EPA number, about 14.4 billion gallons would come from corn ethanol; at the higher level, about 15 billion gallons would come from corn ethanol. The National Corn Growers Assn. (NCGA) and the Renewable Fuels Assn. (RFA) pushed EPA hard at the hearing demanding the agency bring its ethanol RVO up to the 15 billion Congress decided it should be by now. To ignore the 200-million-gallon gap between the law and EPA's proposal is to leave over 70 million bushels of corn "unutilized." RFA reiterated its contention that EPA is not meeting its obligation to get the RFS/RVO process "back on track." Petroleum refiners said the agency needs to set RFS levels that are "reasonable, not aspirational." The American Petroleum Institute (API) told the agency that until Congress fixes the "outdated volume requirements" included in the 2007 authorizing law, EPA should continue to use its waiver authority to set annual volumes for blending with transportation fuels. The National Biodiesel Board (NBB), the National Renderers Assn. (NRA) and the American Soybean Assn. (ASA) all went to bat for higher biodiesel/renewable diesel RFS/RVO levels, saying they're simply "too conservative" at roughly 2 billion gallons for 2018. The NRA witness said of biodiesel refined from animal fats: "Feedstocks are readily available, the market for them is steady and production capacity exceeds the proposed RFS levels...We need to utilize plant capacities as fully as possible for efficiency, to lower the cost of biofuel production and to encourage increased acceptance and use." ASA said EPA should increase proposed RFS/RVO levels for "biomass-based diesel" to 2.5 billion gallons a year, a number reflecting the biodiesel industry's capacity. "We see no reason why EPA should not, at a minimum, support biomass-based diesel volumes of 2.5 billion gallons," ASA said on behalf of soybean farmers who use soy oil to refine biodiesel. "Given the economic and environmental benefits of biodiesel, we believe the soybean industry and EPA should be allies on RFS issues."
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House Judiciary Panel Moves Bill to End Federal Court "Deference" to Agency Actions
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A 30-year-old Supreme Court decision which says federal judges may defer to "reasonable agency decisions" when underlying federal law is vague, could become obsolete after House Judiciary Committee action this week advancing a bill that would end judicial deference.
No longer would federal agencies be given the benefit of the doubt when rulemakings and other actions are challenged in federal court. The practice is based on a 1984 case - Chevron v. NRDC - and is a big part of the Administration's defense of its Clean Power Plan on CO2/carbon recapture, and other regulatory initiatives. The bill approved by the judiciary panel on a 12-8 party line vote would require federal judges to view challenges to agency actions with no deference to agency expertise or interpretation of underlying legislative authority. The bill also nullifies what's known as the Auer doctrine, where federal courts are to give deference to agencies' "reasonable" interpretation of their own rulemakings.
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Northeast Dairy Producers Get $50-Million DFA/DSM Settlement
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A federal court has approved a settlement offer by Dairy Farmers of America (DFA) and Dairy Marketing Services (DMS) to pay $50 million to about 8,860 northeastern U.S. dairy producers who produced/pooled Grade A Milk from 2002-2014, part of settlement of a class action lawsuit alleging DFA, DMS and Dean Foods "conspired to monopolize and eliminate competition," driving milk prices lower within Federal Milk Marketing Order 1.
The approved settlement does not include a $30-million settlement agreed to separately by Dean Foods five years ago. The $50 million, the U.S. District Court for the District of Vermont said, is a "modest recovery," but taken with the earlier Dean Foods settlement, $80 million "is not insubstantial" when the costs of ongoing litigation are considered. The settlement works out to about $4,000 per farm after attorneys' fees, costs, expenses, etc., are deducted. DFA and DMS also agreed to "change their business practices," including a five-year farmer ombudsperson to advocate for farmers; a seat at the DFA/DMS advisory council to advocate for farmers, prices and equity; DFA and DMS agreed to milk testing protocol changes and dispute rules, new farmer notice requirements on adulterated milk reporting, and several other measures.
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Dodd-Frank "Substitute" Unveiled by House GOP
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The House Financial Services Committee this week unveiled a draft bill - a compilation of more than a dozen regulatory relief bills already before the House - that some call a Dodd-Frank "substitute," repealing and replacing most of the Dodd-Frank Wall Street Reform & Consumer Protection Act of 2010 (Dodd-Frank). President Obama calls the plan as outlined by committee Chair Jeb Hensarling (R, TX) in a speech to the Economic Club of New York, "crazy," and the White House press office said the plan "doesn't make any sense."
The bill has little or no chance of action this year, but is seen as a place-holder for the next Congress, particularly if a Republican wins the White House and Congress remains under GOP control. The Hensarling bill - The Financial CHOICE Act - would allow financial institutions to operate with far less federal oversight than under Dodd-Frank, but the price for regulatory relief would be much higher mandatory capital requirements per institution, and much harsher penalties for bad actors. Hensarling said, "The...Act will impose the toughest penalties in history for financial fraud, self-dealing and deception." The new legislation would eliminate "too-big-to-fail" federal bailouts by eliminating Dodd-Frank's Orderly Liquidation Authority, which Hensarling called "a taxpayer bailout fund which can borrow trillions and trillions of taxpayer money in order to resolve large Wall Street banks." The liquidation authority is also how federal regulators implement a prioritized selection of creditors for federal relief, and it would be replaced with a new Financial Institution Bankruptcy Act, setting up a new subchapter of the federal bankruptcy code to address failed financial institutions. Also repealed is the so-called Volcker Rule, action which prohibits banks from engaging in proprietary trading investments for their own accounts. "Of the 450 financial institutions that failed during or as a result of the (financial) crisis, not a single one failed because of proprietary trading," Hensarling said. At the same time, all federal financial regulations would have to pass a cost-benefit test, authorized by the Regulations from the Executive in Need of Scrutiny (REINS) Act. This would change the existing Consumer Financial Protection Bureau (CFPB) into the Consumer Financial Opportunity Commission (CFOC), which would have the dual responsibility of consumer protection and oversight to ensure competitive markets. The new commission would have five members and the commission would be subject to congressional oversight and appropriations. All major regulations would have to be approved by Congress. The bill also would reauthorize the Securities & Exchange Commission (SEC) for five years, "with funding, structural and enforcement reforms." The SEC would be allowed to triple fines for both administrative and civil actions. Also, the SEC could impose sanctions equal to investor losses in cases involving fraud, deceit, manipulation or deliberate or reckless disregard for regulatory requirements. All criminal fines would be increases, and all fines collected by the Public Company Accounting Oversight Board (PCAOB) and Municipal Securities Rulemaking Board would be used for deficit reduction.
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Safety Corner: Permit Required Confined Spaces
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These training shorts can improve safe work habits, productivity, and morale. Protect yourself when working in and around confined spaces:
Mike Taylor, CPCU
Vice President
InterWest Insurance Services, Inc.
100 Pringle Avenue, North Tower, Suite 550
Walnut Creek, CA 94596
(925) 977-4104 Office
(800) 464-0077 Toll Free
(925) 977-4150 Fax
(510) 206-5505 Mobile
CA Lic #0B01094
mtaylor@iwins.com
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