HOUSE BILL NO. 410
AS AMENDED BY HOUSE AMENDMENT NO. 2
AN ACT TO AMEND TITLE 3 OF THE DELAWARE CODE BY ADDING A NEW CHAPTER RELATING TO AGRICULTURAL COMMODITIES DEVELOPMENT.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE (Two-thirds of all members elected to each House thereof concurring therein):
Section 1. Amend Part I of Title 3 of the Delaware Code by adding the following new Chapter:
"CHAPTER 7. AGRICULTURAL COMMODITIES DEVELOPMENT ACT §701. Short Title
This Chapter shall be known and may be cited as the 'Delaware Agricultural Commodities Development Act'.
It is hereby declared to be in the interest of the public welfare that Delaware farmers who produce agricultural commodities for domestic and foreign markets shall be permitted to act separately or jointly in cooperation with handlers, dealers and processors of such products, with the Delaware Department of Agriculture, the University of Delaware's College of Agricultural Sciences and any other qualified agencies, to provide funds to assist in education, research, production and market development related to such commodities. It is further declared that provisions for the establishment of Agricultural Commodity Advisory Boards are deemed an appropriate means to accomplish the purpose.
The sections of this Chapter shall not be construed to abrogate or limit in any way the rights, powers, duties and functions of the Secretary of Agriculture or any other agency of the State, but shall be supplementary thereto, and in aid and cooperation therewith.
For the purpose of this Chapter:
(I) 'Agricultural Commodity' means any agricultural product, including, but not limited to, plants and animals and plant and animal products, grown, raised, or produced within the State of Delaware for use as food, feed, seed or any aesthetic, industrial or chemurgic purpose.
(2) 'Commercial Channels' means the processes of the sale of any agricultural commodity to any commercial buyer, dealer, processor, cooperative or to any person, public or private, who resells such commodity or any product produced from such commodity for storage, slaughter, processing or distribution.
(3) Person' means any individual, corporation, association, cooperative, partnership or organized group of persons whether incorporated or not.
(4) 'Board' or 'Advisory Board' means the boards created under the provisions of the sections of this Chapter in connection with the organization of producers as herein provided.
(5) 'First Purchaser' means any person that buys agricultural commodities for movement into commercial channels from the producer; or any lienholder, secured party or pledgee, public or private, or assignee of said lienholder, secured party or
pledgee, who gains title to the agricultural commodity from the producer as the result of exercising any legal rights by the lienholder, secured party, pledge, or assignee thereof, regardless of when the lien, security interest or pledge was created.
(6) 'Secretary' means the Secretary of Agriculture of the State of Delaware.
(7) 'Producer' means any person who owns or operates an agricultural producing or growing facility for the agricultural commodity under consideration for referendum and shares in the profits and risk of loss from such facility, and who grows, raises, feeds or produces said agricultural commodity in Delaware during the current marketing year.
(8) 'Qualified Voter' means any person who would be subject to the payment of fees imposed to finance the activities described in this Chapter.
(9) 'Development Order' means an order issued by the Secretary with the advice and consent of an Agricultural Commodity Advisory Board pursuant to the provisions of this Chapter.
(10) 'Sale' means any passing of commodity title from the producer to the first purchaser. Sale includes any pledge, security, interest or lien.
§704. Boards; Membership; Election; Term
(1) An Agricultural Commodity Advisory Board is hereby created for the producers of each agricultural commodity who file with the Secretary a petition requesting that the producers of such commodity be subjected to the provisions of the sections of this Chapter. The petition is to be signed by a least 100 producers or at least 10 percent of the producers of such commodity whichever is less. Such petition shall be certified by at least two producers to have been signed only by producers of the commodity involved.
(2) Membership. Upon petition of the required number of producers, the Secretary shall, after consultation with the various agricultural or commodity organizations petitioning for a referendum, determine the size of the Agricultural Commodity Advisory Board and distribution of the Board membership. The advisory board may designate agricultural industry, Department of Agriculture and University of Delaware personnel, either by name or by office, to serve as consultants to the board.
(3) Election. Within 30 days after the filing of the petition by the required number of the producers, the Secretary shall appoint a nominating committee of five persons from the involved agricultural or commodity organizations who shall, within 60 days from the filing of such petition, nominate at least two candidates for each advisory board position and certify the names of such nominees to the Secretary. Nominees shall be selected with a view to establishing a fair representation of all producers throughout the area to be organized, which shall comprise the entire State unless otherwise determined by the Secretary after consultation with agricultural and commodity organizations, in which event he shall define such area following county lines. Upon receipt of the nominations, the Secretary shall promptly arrange an election to be held at places designated by him, reasonably convenient to all producers in the organized area, and give at least 14 days' notice of such election in at least one newspaper having a general circulation in the organized area. Ballots setting forth the names of nominated candidates and providing for write-in candidates shall be made available at all polling places. Only producers of the particular commodity shall be qualified to elect members of that commodity's advisory board. Polling procedures shall be established to avoid voting by others than those qualified to vote. An impartial committee appointed by the Secretary shall tabulate the votes and the candidates receiving the most votes shall be declared elected to the first advisory board. In each calendar year following the one in which the first board is elected, candidates shall be selected and an election shall be held to elect a successor or successors to the board member or members whose term or terms expire in that year. Nominations shall be made and the elections shall be held in the same manner as
prescribed for the first board except that the choice of nominating committee members, the time of nominations and the time and place of elections shall be fixed by the Secretary with the consent of the advisory board.
(4) Terms. At the first meeting of the first advisory board the Secretary shall determine by lot one-third of the board members whose terms shall expire June 30 in the calendar year following the year of the first election, one-third of the board members whose terms shall expire June 30 in the second calendar year and the remaining board members whose terms shall expire June 30 in the third calendar year. In the event the Secretary has designated specific areas for representation on the advisory board, the terms of board members in any one area shall not expire in the same year. All elected successor board members shall be elected for three year terms and each shall serve until his successor is elected and qualified. No board member shall succeed himself after serving two full terms. In the event a board member ceases to have any of the qualifications herein established, his office shall be deemed vacant. Any interim vacancy on the board shall be filled by appointment of the board for the remainder of the term vacated.
(5) Organization. The Secretary of Agriculture shall serve as secretary of the advisory board without vote. The board shall elect, from its own membership, a chairman, and a vice chairman who shall act in the absence of the chairman, and such other officers as the board may deem appropriate. The terms of such officers shall expire on June 30 of each year and their successors shall be elected at the first meeting following that date.
S705. Meetings; Quorum
Subject to the requirements of the sections of this Chapter, the advisory board shall meet at such times and place as it may determine or upon call of the chairman or of any three members of the board. A majority of the voting members of the board shall constitute a quorum for the transaction of all business in carrying out the duties of the board.
S706. Advisory Board to Formulate and Submit Development Order
(1) Within 30 days after the election of an Agricultural Commodity Advisory Board by the producers of a particular commodity, the advisory board shall meet and formulate a development order establishing a program to assist such functions as education, research, production and market development relating to such commodity or commodities and establishing fees to be paid by producers to finance the proposed activities.
(2) Hearings. The Secretary, with the advice and consent of the advisory board, shall hold a public hearing or public hearings on the proposed development order in a area or areas and at a time or times affording reasonable opportunities to producers to attend. The advisory board together with the Secretary shall determine after such hearings whether or not the development order shall be amended, modified, or supplemented. If changes or additions of substance are made, the advisory board and the Secretary shall hold like public hearings on the amended or supplemented development order.
(3) Referendum. Following the hearing, or hearings, the advisory board and Secretary shall conduct a referendum on the proposed final development order. At least 14 days' notice of the time and places of such referendum shall be published in a legal newspaper of general circulation in each county affected. In addition, direct written notice thereof shall likewise be given to each county extension office in any county involved in the referendum. Such notice shall include details of the development order to afford all producers access to complete information about the development order. The development order shall become effective if it is approved by a majority of those voting (n the referendum, and such order shall be applicable only to those producers of the subject commodity within the area of the State organized to the sections of this Chapter. Upon completion of the referendum, the Secretary shall make findings and issue an appropriate order based on said findings.
SM. Additional Powers and Duties of the Agricultural Commodity Advisory Board
(1) Adoption of Regulations and Budget. The Agricultural Commodity Advisory Board shall:
a. Adopt and administer rules and regulations for the administration of the development order.
b. Recommend amendments to the order, such amendments to be adopted only after a referendum in which a majority of the producers voting favor such adoption.
c. Prepare an annual estimated budget for the operation of the development order; and
d. Prepare an annual report on the programs of the order, said report to be made available to the producers concerned.
(2) The advisory board shall provide a procedure for collection of the producer assessments to finance the development order and for the proper administration of the order.
(3) Refunds of fees. The advisory board shall provide for the refund of any fees or assessments paid by the producer who objects to payments of said fees or assessments.
(4) Donations. The advisory board is authorized to accept donations of funds, property, services or other assistance from public or private sources for the purpose of furthering the objectives of this Chapter.
(5) Right to Sue and to Be Sued. The advisory board shall have the right to investigate and prosecute in the name of the State of Delaware any action or suit to enforce the collection or insure payment of fees or assessments authorized by the provisions of the sections of this Chapter, and to sue and to be sued in the name of the board; to do all other things necessary to the administration and implementation of this Chapter.
(6) Collection and Expenditure of Funds: Audit. The advisory board shall be responsible for the collection and expenditure of all funds provided for under the sections of this Chapter and shall provide for an annual audit of funds to be made by a certified auditing firm. An annual financial statement shall be available to any participant upon request.
§708. Powers and Duties of Secretary
(1) Contracts. The Secretary with the advice and consent of the advisory board, will contract and cooperate with the University of Delaware's College of Agricultural Sciences, or with other qualified agencies, persons or organizations to meet the purpose of the development order.
(2) Personnel. The Secretary, with the advice and consent of the advisory board, may appoint, employ, provide necessary bond, discharge, fix compensation for and prescribe the duties of such administrative, clerical, technical and other personnel and agencies as may be deemed necessary.
(3) General Powers. In administering the sections of this Chapter, the Secretary shall have such other powers as may be conferred upon him by law not inconsistent with the provisions of this Chapter.
(4) Regulations. In the organization and operation of a development order for any agricultural commodity coming under the sections of this Chapter, the Secretary shall follow the rules and regulations as developed by1the advisory board pursuant to the provisions of this Chapter.
§709. Fees to Defray Expenses
(I) Assessment. For the purpose of providing funds to defray the necessary expenses incurred by the Secretary and the advisory board in formulating, submitting to referendum, issuing, administering and enforcing an agricultural commodity development order, the development order shall provide for assessing and collecting fees in amounts sufficient to defray such expenses. Any increase in the maximum assessment provided for in the development order must be within the limit herein prescribed and must be approved by the majority of voting, participating producers in a referendum held for that purpose after reasonable notice of such proposed increase.
(2) The Agricultural Commodity Advisory Boards together with the Secretary shall establish the procedure for the payment of the assessment by the producer and such procedures shall be clearly outlined in the proposed development order. Such procedure must be fair, reasonable and shall be deducted by the first purchaser at the time of sale. The first purchaser shall submit to the advisory board through the Secretary's office any fees so deducted once every 30 days. When proof of payment of the fee assessed can be furnished, it shall not be necessary for any subsequent buyer to deduct the fee at time of purchase.
(3) Financing Referendums. The Secretary shall require producers petitioning for a development order to deposit with him in advance such amount as he deems necessary to defray the expense of electing the first board formulating an order, submitting it to referendum and issuing the order. If the order is issued, such persons shall be reimbursed when funds are available from assessments. If the order N not issued the Secretary shall refund only that portion of the deposit remaining after payment of expenses incurred on a pro rata basis.
(4) Deposit and Use of Fees. Fees collected pursuant to the sections of this Chapter shall be deposited in a bank or banks or other depository approved by the Secretary of Finance of the State of Delaware and shall be disbursed by such officers and employees as may be approved by the advisory board for the necessary expenses incurred in the administration of this Chapter. Fees collected shall be used exclusively for the purpose collected and not for legislative or political activities.
§710. Compensation and Expenses
Each member of the advisory board, except the Secretary, shall be entitled to a reasonable per diem to be fixed in the development order and actual expenses incurred while attending board meetings, but only actual expenses incurred while engaged in official business of the advisory board.
§711. Legal Counsel
The advisory board may appoint an attorney who shall act for the board and the Secretary when required. The board shall fix the compensation and terms of employment of such attorney.
S712. Records of the Advisory Board
All of the records of the advisory board shall be public records and shall be available for inspection for any lawful purpose, provided, however, that the advisory board shall be empowered to make reasonable rules and regulations concerning the time or place of such inspection, as provided in the Delaware Sunshine Law, 29 Delaware Code, 1001 et. seq.
S713. Refund of Fees
Any producer, by the use of forms to be provided by the Secretary and upon presentation of such proof as the Secretary and advisory board may require by rule or regulation, have the fee paid pursuant to the sections of this Chapter refunded to him. Such request for refund must be received In the office of the Secretary or the advisory board within 60 days following the payment of such fee, but in no
event shall these requests for refund be accepted more often than 12 times per year and must be made at least once each year. Refund shall be made by the Secretary or advisory board within 30 days of the request for refund provided that the fee sought to be refunded has been received. Rules and regulations governing the refund of fees for the commodity involved shall be formulated by the board together with the Secretary and shall be fully outlined at the hearing, or hearings, and be available for the information of all persons concerned with the referendum.
§714. Termination of the Order
(I) By Advisory Board. The advisory board shall suspend or terminate a development order whenever it finds, after a public hearing or hearings, that an order is contrary to or does not tend to effectuate the purposes or provision of the sections of this Chapter, provided that such suspension or termination shall not become effective until the expiration of the current marketing year. The current marketing year described under the sections of this Chapter shall be determined by the board together with the Secretary.
(2) By Referendum. Upon petition of the same number of producers as required to initiate the development order, the Secretary with the advice and consent of the advisory board shall within 60 days conduct a referendum to determine whether or not the development order shall be continued. He shall terminate the order at the end of the current marketing year If a majority of the persons voting in the referendum vote in favor of termination. Such petitions of producers shall include a certification statement that the signatures are those of qualified producers of the commodity involved.
S715. Expenditure of Funds Upon Termination of Order
Any funds remaining with the advisory board after the termination of a development order shall be expended to meet existing legal obligations of the board. Any surplus remaining shall be expended for research purposes, or other lawful purposes under the sections of this Chapter at the discretion of the board.
S716. Association of Procedures Not Illegal
No activity, including meetings, undertaken in pursuance of the provisions of the sections of this Chapter that are intended to benefit the procedures, handlers and processors of such agricultural commodity shall be deemed or considered illegal or in restraint of trade.
§717. Penalty for Violations
Any person who violates any provision of the sections of this Chapter or rule or regulation of a Agricultural Commodity Advisory Board promulgated pursuant to the sections of this Chapter is guilty of a Class C misdemeanor. Justices of the Peace shall have jurisdiction over all offenses under this Chapter.