DAR File No. 39763

Agriculture and Food, Marketing and Development

Rule R65-4

Utah Egg Marketing Order

Notice of Proposed Rule

(Repeal)

DAR File No.: 39763
Filed: 09/23/2015 08:21:44 AM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The rule establishes a Marketing Order for Eggs. The industry has grown to the point that they are providing for their own marketing. As such, it is no longer necessary to continue the Egg Marketing Order.

Summary of the rule or change:

The proposed change is a complete repeal of the rule. There will no longer be a Marketing Order for eggs when the rule takes effect. This will disband the Egg Marketing Board.

State statutory or constitutional authorization for this rule:

• Subsection 4-2-2(1)(e)

Anticipated cost or savings to:

the state budget:

The repeal of this rule will disband the Egg Marketing Board. As a result, the state will save on travel and per diem costs for the five-member board.

local governments:

Local governments had no role in the administration or enforcement of this rule. Local governments will not be affected by the repeal of this rule.

small businesses:

Egg producers will no longer be obligated to pay the $0.30 per case required by the Marketing Order.

persons other than small businesses, businesses, or local governmental entities:

Egg producers will no longer be obligated to pay the $0.30 per case required by the rule in order to facilitate the marketing of their product.

Compliance costs for affected persons:

This is a repeal of the rule. There will be no costs to the producers as they will no longer be bound by the marketing order. The repeal of this rule will actually lead to a savings for the small businesses, businesses, and the state.

Comments by the department head on the fiscal impact the rule may have on businesses:

The repeal of this rule does away with the Egg Marketing Order. This would eliminate the fees that are collected by the Marketing Board. These fees will be kept by the producers and will be up to the producer to fund their own marketing campaigns.

LuAnn Adams, Commissioner

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Agriculture and Food
Marketing and Development
350 N REDWOOD RD
SALT LAKE CITY, UT 84116-3034

Direct questions regarding this rule to:

• Kathleen Mathews at the above address, by phone at 801-538-7103, by FAX at 801-538-7126, or by Internet E-mail at kmathews@utah.gov
• Scott Ericson at the above address, by phone at 801-538-7102, by FAX at 801-538-7126, or by Internet E-mail at sericson@utah.gov
• Wayne Bradshaw at the above address, by phone at 801-538-7108, by FAX at , or by Internet E-mail at waynebradshaw@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

11/16/2015

This rule may become effective on:

11/23/2015

Authorized by:

LuAnn Adams, Commissioner

R65. Agriculture and Food, Marketing and Development.

[R65-4. Utah Egg Marketing Order.

R65-4-1. Authority.

A. Promulgated under authority of Section 4-2-2(1)(e), which authorizes issuing marketing orders to promote orderly market conditions for agricultural products.

B. The Commissioner of Agriculture and Food finds, after a study of information available and by request of the industry that it is in the public interest to establish a marketing order to improve conditions in the egg producing industry. The Commissioner finds that the issuance of this marketing order is approved and favored by at least 50 percent of the producers and handlers voting on the referendum representing not less than two-thirds of the egg production for the State of Utah during the calendar year. The production and marketing of egg products by numerous individual egg producers has prevented coordinated efforts in research and promotion necessary to maintain and expand markets. This process is vital to the well-being of the Utah egg industry which provides one of the basic, natural foods in the diet. It is therefore ordered by the Commissioner, acting by the authority vested in him, that an Order be established to assure an effective and coordinated program to maintain and expand the Utah egg industry's market position, and that the producers shall be subject to the terms and provisions of the Order.

 

R65-4-2. Definition of Terms.

A. "Commissioner" means the Commissioner of the Utah Department of Agriculture and Food.

B. "Person" means any individual, group of individuals, partnership, corporation, association, cooperative, legal representative, or any other entity.

C. "Commercial Eggs" or "Eggs" means eggs from domesticated chickens which are sold for human consumption either in the shell egg form or for further processing into egg products.

D. "Producer" means a person owning at least 3,000 laying hens engaged in the business of producing or causing to be produced eggs for the commercial market, provided such producers shall not include producers who sell all the commodity to the consumer.

E. "Registered" producers means producers who have indicated that they want to be included in the marketing order voting process by registering to vote in the referendum. Registration forms may be mailed out with the ballots.

F. "Known" producers means producers of a specific commodity who have been identified by the commodity group, themselves, or a third party as being eligible to register to vote in a referendum affecting that specific commodity.

G. "Case" means a standard shipping package containing 30 dozen eggs.

H. "Spent Hen" means hens which have been in production of commercial eggs and have been removed from such production.

I. "Handler" means an individual or an organization engaged in the merchandising of eggs or egg products.

 

R65-4-3. Board.

A. The Utah Egg Board is hereby established consisting of five members of the egg industry, plus ex-officio non-voting members from BYU and USU, and Utah Department of Agriculture and Food.

B. The original members of the Board shall be selected by the Commissioner from a list submitted by the industry.

C. Successors to original members shall be appointed by the Commissioner from names submitted by the industry. Two members shall be appointed for a period of three years. Three members shall be appointed for a period of four years. After the first three years, each appointed member shall serve for a period of four years. This rotation shall be in effect for the term of the marketing order. In the event of a vacancy the Commissioner shall appoint a new member from names submitted by the Board.

D. Members of the Board shall only succeed themselves once and not serve on the Board for more that eight consecutive years.

E. The officers of the Board shall be selected from the five Board members at their first meeting after reorganization. The officers shall consist of a Chairman and a Vice Chairman, to be elected yearly by the members of the Board. In the event of a vacancy or unfilled office, it shall be filled through an election as soon as practical and shall be for the remainder of the unexpired term.

F. The Board shall exercise the following functions, powers and duties:

1. to receive and expend funds collected for the benefit of the Utah egg producers,

2. to cooperate with any local, state or national organization engaged in activities similar to those of the egg marketing Board,

3. to conduct a public educational program to increase the consumption of Utah produced eggs where and when possible.

G. Attendance of three members at a duly called meeting shall constitute a quorum for the transaction of official business. The Board shall meet at least quarterly.

H. Each member of the Board is entitled to per diem and expenses in accordance with Sections 63A-3-106 and 63A-3-107.

I. Financial report will be made available annually for the Board and members of the industry by the Utah Department of Agriculture and Food.

 

R65-4-4. Provisions of the Order.

A. This order provides for:

1. Uniform grading and inspection of eggs sold or offered for sale by producers or handlers and for the establishment of grading standards of quality, conditions, and size. Such grading standards shall not be established below any minimum standards now prescribed by law for the State.

2. Advertising and sales promotion to create new or larger markets for eggs produced in Utah, provided that any such plan shall be directed towards increasing the sale of such commodity without reference to particular brand or trade name.

3. The labeling, marketing, or branding of egg or egg products in conformity with the regulations of the Commissioner or the laws of the State of Utah already in existence and written in the Utah Code.

4. Research projects and experiments for the purpose of improving the quality, size, vitality, and general condition of the egg industry and for the purpose of protecting the health of the people of Utah.

5. The Board may cooperate with any other state or federal agency whose activities may be deemed beneficial to the purpose of this Order.

B. Expenses - Assessments - Collection and Disbursement.

1. Each producer subject to this Order shall pay to the Board his or her pro rata share of such expenses as the Commissioner may find necessary to be incurred by the Board for the functioning of said Marketing Order. Each producer shall pay up to 30 cents per case to the Board annually. The discretionary assessment shall be set by majority vote of the board, and approved by the Commissioner. This assessment levied in the specified amount shall constitute a personal debt of every person so assessed and shall be due and payable when payment is called for thereby. The pro rata share of the expenses payable by a cooperative association of producers shall be computed on the basis of the quantity of the product covered by the Order which is distributed, sold, or shipped in commerce by such cooperative association of producers.

2. The assessment of each producer shall be deducted from the producer's gross receipt by the dealer or producer-handler. All proceeds from the deducted portion shall be paid at least quarterly to the Commission upon request of the Board.

3. The Board shall retain records of the receipt of the assessment. The records shall be audited annually by an auditor approved by the Commissioner. Copies of the audit shall be available to any contributor upon request.

4. The Board of Control is required to reimburse the Commissioner for any funds as are expended by the Commissioner in performing his duties, as provided in this Order. Such reimbursement to include only funds actually expended in connection with this Order.

5. The Board is authorized to incur such expenses as are necessary to carry out its functions subject to the approval of the Commissioner. The Board shall receive and disburse all funds received by it pursuant to Section R65-4-5. Any funds remaining at the end of any year over and above the necessary expenses of said Board of Control may be divided among all persons from whom such funds were collected. At the discretion of the Board, such amounts may be applied to the necessary expenses of the Board for the continuation of its program during the next succeeding year.

6. Any producer who wishes a refund of their paid assessment may request such by notifying the Board in writing within sixty days of payment of the assessment.

 

R65-4-5. Division of Funds.

Assessments made and monies collected under provisions of this order shall be divided into assessments and funds for:

A. administrative purposes,

B. educational purposes, advertising and promotional purposes, and

C. research purposes. Such assessments and funds shall be used solely for the purposes for which they are collected; provided, that funds remaining at the end of any year may be used in the succeeding year and provided, that no funds be used for political or lobbying activities.

 

R65-4-6. Board - Member's Liability.

No member of the Board, nor any employee of the Board, shall be deemed responsible individually in any way whatsoever to any producer, distributor, handler, processor, or any other person, for errors of judgment, mistakes, or other acts, either of commission or omission of principal, agent, person, or employee, except for his own individual acts of dishonesty or crime. No such person or employee shall be held responsible individually for any act or omission of any other member of the Board. The liability of the members of such Board shall be several and not joint, and no member shall be liable for the default of any other member.

 

R65-4-7. Complaints for Violations - Procedure.

Complaints for violations shall be handled by the responsible legal agencies and shall be enforced in the civil courts of the state.

 

R65-4-8. Termination of Order.

The Commissioner may terminate the Marketing Order at such time as he may determine there is no longer an industry need for such order. A referendum vote may be called at the request of the producers through a petition of 40 percent of the producers.

 

R65-4-9. Quarterly Meeting.

The Board shall meet at least quarterly.

 

KEY: promotions

Date of Enactment or Last Substantive Amendment: 1987

Notice of Continuation: September 8, 2014

Authorizing, and Implemented or Interpreted Law: 4-2-2(1)(e)]