Testimony of Wayne Carlson
Program Manager
House Bill 1129
House Agriculture Committee
Peace Garden Room
January 16, 2003

Chairman Nicholas, and Committee members, my name is Wayne Carlson. I am the Livestock Services Coordinator for the Department of Agriculture. I am here to testify in support of House Bill 1129.

This legislation amends the current dairy check-off appropriation so it conforms more closely to the federal check-off rules. The legislation is also in response to required updates to the state dairy laws that have been adopted by reference

The North Dakota Dairy Promotion Board (NDDPB) asked the North Dakota Department of Agriculture to submit this bill on their behalf to clarify the law as it pertains to the collection of promotion fees. Currently NDDPB collects ten cents per hundredweight on all milk produced and sold by North Dakota dairymen. Those monies are collected and deposited with the Bank of North Dakota each month. The normal business practice is for the processor to collect the fees from the producer's milk proceeds and send one check each month following the delivery of the milk which makes several processors in violation of the current statute that requires all payments to be made within fifteen days of the delivery month. When audited by the state auditor, the North Dakota Milk Promotion board had been marked for failure to collect interest for late payments.

NDDPB believes the current law should be amended to allow additional time for processors to submit the fees and to reduce the interest penalty from 10 ½ percent to 1 ½ percent. This action would make the state law similar to the federal law that also collects five cents per hundredweight and provides the needed flexibility for the processors to meet state law.

However, since the original bill was drafted, it was suggested, by the promotion board, that further clarification would best suit their needs. I am submitting an amendment to the current bill that would accomplish this.

Line 18-21 of page one should read:
The remittance of such assessments must be made monthly not later than the last day of the month following the month in which the milk was marketed. Assessments unpaid on the date on which they are due and payable may be increased by one and one-half percent of the amount of the assessment.

This clarification will allow for the varying number of days in each month. The promotion board could also choose not to assess a late penalty if the cash value of the penalty was too small to make it worth their time in billing and collecting it. This is accomplished by changing "shall" to "may".

The next three amendments deal with the dairy laws that our state has adopted by reference. The Food & Drug Administration has published ordinances for all states to use. The 2001 Revision of the Pasteurized Milk Ordinances was released for general publication in October 2002. The companion publications of ordinances that govern Interstate Milk Shipments and Methods of Making Sanitation Ratings were released at the same time. It is my recommendation that these laws be amended to reflect the most current revision of dairy law.

Mr. Chairman and committee members, with these amendments, I urge a do pass on House Bill 1129.

Thank you. If you have any questions, I would be glad to answer them.