Amendments to Pennsylvania’s Milk Marketing Law

Senator Mike Brubaker (Lancaster Co.- R), introduced Senate Bill 993 to amend the Pennsylvania Milk Marketing Law, similar to Senate Bill 1480 of last session.  Some of the key changes to Pennsylvania’s milk marketing law proposed in SB 993 include the following:

• Creation of a “milk distributor” – a person who purchases or receives milk outside PA and sells milk in PA – who would be required to be licensed and keep records of milk received and marketed (something that is already required for licensed dealers). 
• Expands producers eligible to receive Class I over-order premium to include PA producers and out-of-state producers whose milk is delivered to a PA plant or whose milk is marketed in a transaction subject to minimum PA pricing.
• Increases Pennsylvania Milk Marketing Board from three to five members; implements reduced terms and term limits.
• Provides the Board with unlimited discretion to establish minimum prices in one Milk Marketing Area, in multiple Areas, or in PA as a whole.
• Changes basis of minimum producer pricing from cost of production plus reasonable profit (current law) to at least $8.00 per hundredweight over cost of feed (subject to authority of the Board to make further adjustments in minimum price identified in the next item).
• Permits the Board to adjust cost-based pricing of milk where market is threatened (current law).  If statutory minimums for producers, dealers and stores cannot be attained, the price adjustments must be performed in a manner as to “affect equitably producers, dealers or handlers and stores selling milk.” 
• Establishes the farm (instead of the plant) as the place for determining application of minimum producer pricing.
• Directs mandated producer premiums (above Federal-order price) to be paid into a Producer Settlement Fund (essentially a “pool”) to be created under the legislation.  Money paid into the Fund would be distributed to “qualified producers.”  Cooperatives would not be eligible for distribution of premium proceeds.
Pennsylvania Farm Bureau policy supports Senate Bill 993, which would provide a higher level of accountability of producer premiums paid by consumers, greater opportunity for producers to receive premiums from milk that has crossed state lines and a market-wide pool to more equitably distribute premiums among dairy producers.  If passed into law, this legislation will assure more of the consumer dollar reaches Pennsylvania’s dairy farmers across the state.

Pennsylvania Farm Bureau urges support for the Senate Agriculture and Rural Affairs Committee advancing Senate Bill 993 from committee for the full Senate’s consideration.