PROPOSED RULEMAKING
DEPARTMENT OF AGRICULTURE
[ 7 PA. CODE CH. 107 ]
Pennsylvania Preferred Trademark Licensure Program
[43 Pa.B. 6366]
[Saturday, October 26, 2013]The Department of Agriculture (Department) proposes to add Chapter 107 (relating to Pennsylvania Preferred Trademark Licensure Program) to read as set forth in Annex A.
The proposed rulemaking would establish the standards under which the Department would license qualified entities to make use of the Pennsylvania Preferred® trademark to promote or market Pennsylvania-produced fluid milk, that is, fluid milk that is entirely produced within this Commonwealth. Proposed Chapter 107 will replace interim guidelines for the Pennsylvania Preferred Trademark Licensure Program (Program) published at 42 Pa.B. 2752 (May 19, 2012), which expire no later than December 31, 2013.
''Fluid milk'' consists of milk, skimmed milk, cream, sour milk, buttermilk and other fluid derivatives of milk. The entities that will qualify for the referenced licenses are persons who produce or process Pennsylvania-produced fluid milk or that promote or market Pennsylvania-produced fluid milk from this type of processor.
Authority
This proposed rulemaking is authorized under 3 Pa.C.S. §§ 4601—4611 (relating to Pennsylvania Preferred Act) (act). Section 4611 of the act (relating to rules and regulations) requires the Department to promulgate rules and regulations necessary to promote the efficient, uniform and Statewide administration of the act. Section 4611 of the act authorizes the use of interim guidelines through December 31, 2013.
Need for the Proposed Rulemaking
The Department proposes to add Chapter 107 to replace the interim guidelines for the Program, which expire no later than December 31, 2013.
Section 4606(a)(4) of the act (relating to trademark license agreement, application and licensure process) provides the Department the discretion to determine whether a person is a qualified entity eligible to be licensed to make use of the Pennsylvania Preferred® trademark. Section 4604(2)(iii) of the act (relating to licensee qualification) requires the Department to consider the extent to which the agricultural commodity with respect to which the Pennsylvania Preferred® trademark would be used is ''to the maximum extent possible given production season restrictions or market availability . . . a Pennsylvania-produced agricultural commodity.''
Dairy producers in this Commonwealth produce fluid milk in quantities that exceed the year-round needs of milk processors and milk consumers in this Commonwealth. Surplus Pennsylvania-produced fluid milk supply generally remains available on the Pennsylvania market throughout the year. Against this backdrop, proposed Chapter 107 prohibits (with several exceptions) the use of the Pennsylvania Preferred® trademark with respect to fluid milk that is not entirely Pennsylvania-produced fluid milk.
Proposed Chapter 107 acknowledges that there may be exceptions to this prohibition, such as when there is a Statewide shortage of fluid milk or when a processor commingles Pennsylvania-produced fluid milk with other fluid milk on an incidental, emergency or short-term-basis.
To date, four dairy operations or dairy processors that produce or process Pennsylvania-produced fluid milk are licensed by the Department to use the Pennsylvania Preferred® trademark in connection with that milk. The Pennsylvania Preferred® trademark is a recognizable standard of Pennsylvania origin and product quality, making products that bear that trademark more attractive in the marketplace.
Summary of the Proposed Rulemaking
The proposed rulemaking replaces and restates the Department's current interim guidelines for the Program, which took effect on May 19, 2012, and expire no later than December 31, 2013.
Dairy producers in this Commonwealth produce fluid milk in quantities that exceed the year-round needs of milk processors and milk consumers in this Commonwealth. This surplus of Pennsylvania-produced fluid milk supply generally remains available on the Pennsylvania market throughout the year. Against this backdrop, proposed Chapter 107 prohibits, with several exceptions, the use of the Pennsylvania Preferred® trademark with respect to fluid milk that is not entirely Pennsylvania-produced fluid milk.
Proposed Chapter 107 acknowledges that there may be exceptions to the previously-described prohibition, such as when there is a Statewide shortage of fluid milk or when a processor commingles Pennsylvania-produced fluid milk with other fluid milk on an incidental, emergency or short-term-basis.
Proposed § 107.2 (relating to definitions) repeats several defined terms from the act and defines ''fluid milk'' and ''Pennsylvania-produced fluid milk.''
Proposed § 107.3 (relating to licensure of the Pennsylvania Preferred trademark with respect to fluid milk) states the Department's determination that there is an adequate supply of Pennsylvania-produced fluid milk and establishes the standards under which the Department will license the use of the Pennsylvania Preferred® trademark for use in marketing Pennsylvania-produced fluid milk.
Persons Likely to be Affected
The proposed rulemaking is not expected to have an adverse impact on any group or entity.
Any impact of the proposed rulemaking will be positive and be upon those producers or processors of Pennsylvania-produced fluid milk that elect to be licensed by the Department to make use the Pennsylvania Preferred® trademark. The fluid milk marketed under this trademark is expected to be more attractive in the marketplace. The trademark is an increasingly well-known identifier of Pennsylvania origin and product quality. Although the use of the trademark should make the fluid milk more attractive in the marketplace, if a licensee feels it is not benefitting from the use of the trademark it may discontinue the use of that trademark at any time.
Fiscal Impact
Commonwealth
The proposed rulemaking will not have appreciable fiscal impact upon the Commonwealth.
Political subdivisions
The proposed rulemaking will not have appreciable fiscal impact on political subdivisions.
Private sector
The proposed rulemaking will not have appreciable fiscal impact upon the private sector. Eligible producers or processors of Pennsylvania-produced fluid milk who wish to obtain a license from the Department allowing the use of the Pennsylvania Preferred® trademark in marketing Pennsylvania-produced fluid milk are free to apply for that license and are free to discontinue use of that trademark at any time.
General public
The proposed rulemaking will not have appreciable fiscal impact on the general public.
Paperwork Requirements
The proposed rulemaking will not result in an appreciable increase in the paperwork handled by the Department. The Department has current license agreements with four producers or processors of Pennsylvania-produced fluid milk, authorizing each to make commercial use of the Pennsylvania Preferred® trademark. Since the proposed rulemaking does not require the Department to revise or redo these current trademark license agreements, the impact of the proposed rulemaking on paperwork will be minimal or nonexistent.
Effective Date
The proposed rulemaking will be effective upon final-form publication in the Pennsylvania Bulletin.
Sunset Date
There is not a sunset date for the proposed rulemaking. The Department will review the efficacy of the regulations on an ongoing basis.
Public Comment Period/Contact Person
Interested persons are invited to submit written comments regarding the proposed rulemaking within 30 days following publication in the Pennsylvania Bulletin. Comments are to be submitted to the Department of Agriculture, Bureau of Market Development, 2301 North Cameron Street, Harrisburg, PA 17110-9408, Attention: Lela Reichart, Director.
Regulatory Review
Under section 5(a) of the Regulatory Review Act (71 P. S. § 745.5(a)), on October 11, 2013, the Department submitted a copy of this proposed rulemaking and a copy of a Regulatory Analysis Form to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the House and Senate Standing Committees on Agriculture and Rural Affairs. A copy of this material is available to the public upon request.
Under section 5(g) of the Regulatory Review Act, IRRC may convey any comments, recommendations or objections to the proposed rulemaking within 30 days of the close of the public comment period. The comments, recommendations or objections must specify the regulatory review criteria which have not been met. The Regulatory Review Act specifies detailed procedures for review, prior to final publication of the rulemaking, by the Department, the General Assembly and the Governor of comments, recommendations or objections raised.
GEORGE D. GREIG,
SecretaryFiscal Note: 2-177. No fiscal impact; (8) recommends adoption.
Annex A
TITLE 7. AGRICULTURE
PART IV. BUREAU OF MARKET DEVELOPMENT
CHAPTER 107. PENNSYLVANIA PREFERRED TRADEMARK LICENSURE PROGRAM Sec.
107.1. Purpose. 107.2. Definitions. 107.3. Licensure of the Pennsylvania Preferred trademark with respect to fluid milk. § 107.1. Purpose.
This chapter describes the circumstances under which the Department will license third parties to use the Pennsylvania Preferred trademark with respect to fluid milk; establishes standards and procedures to promote the efficient, uniform and Statewide administration of the act; and clarifies the conditions under which a person who produces or markets milk is a qualified entity for purposes of the act.
§ 107.2. Definitions.
The following words and terms, when used in this chapter, have the following meanings, unless the context clearly indicates otherwise:
Act—3 Pa.C.S. §§ 4601—4611 (relating to Pennsylvania Preferred Act).
Department—The Department of Agriculture of the Commonwealth.
Fluid milk—Milk, skimmed milk, cream, sour milk, buttermilk and other fluid derivatives of milk. The term includes milk from hooved mammal species.
Licensee—A qualified entity that is subject to a current Pennsylvania Preferred trademark license agreement with the Department.
Pennsylvania Preferred trademark—One or more trademarks that consist of the phrase ''Pennsylvania Preferred'' or ''PA Preferred'' that may include specific graphic designs or artwork as part of the trademark registration.
Pennsylvania-produced fluid milk—Fluid milk that is entirely produced within this Commonwealth.
Person—An individual, partnership, corporation, association or other legal entity.
Qualified entity—A person that produces, processes, prepares, sells, offers for sale, markets, promotes or is involved with any aspect of production, processing, preparation, promotion, marketing, sale or offering for sale of Pennsylvania-produced agricultural commodities.
§ 107.3. Licensure of the Pennsylvania Preferred trademark with respect to fluid milk.
(a) General availability of Pennsylvania-produced fluid milk. Fluid milk is an agricultural commodity that is, in general, produced by dairy producers in this Commonwealth in quantities that exceed the year-round needs of milk processors and milk consumers in this Commonwealth. Surplus Pennsylvania-produced fluid milk supply generally remains available on the market in this Commonwealth throughout the year.
(b) Eligibility.
(1) A person that processes Pennsylvania-produced fluid milk or that promotes or markets Pennsylvania-produced fluid milk from this type of processor is a qualified entity that is eligible to apply to be licensed by the Department to use the Pennsylvania Preferred trademark with respect to that Pennsylvania-produced fluid milk. Examples of fluid milk with respect to which this license may be granted include the following Pennsylvania-processed or Pennsylvania-produced items:
(i) Whole milk.
(ii) Reduced fat milk.
(iii) Skim milk.
(iv) Flavored milk.
(v) Cream.
(vi) Buttermilk.
(vii) Half-and-half.
(viii) Other beverages comprised in whole or in part of fluid milk.
(ix) Other fluid derivatives of milk.
(2) A person that processes fluid milk that is not Pennsylvania-produced fluid milk, or that promotes or markets fluid milk from this type of processor, is not a qualified entity and is not eligible to apply to be licensed by the Department to use the Pennsylvania Preferred trademark with respect to this milk.
(3) Except as provided in subsection (c) or (d), fluid milk marketed under the Pennsylvania Preferred trademark may not be comingled with fluid milk produced outside this Commonwealth.
(c) Short Statewide supply exception. Subsections (a) and (b) notwithstanding, if the Department determines that the available supply of Pennsylvania-produced fluid milk is not generally available as described in subsection (a), the Department will publish a notice in the Pennsylvania Bulletin to designate a time period, not to exceed 1 year, within which the Department may license the Pennsylvania Preferred trademark with respect to fluid milk that is not entirely Pennsylvania-produced fluid milk.
(d) Incidental, emergency or short-term commingling exception.
(1) Subsections (a) and (b) notwithstanding, a person that is licensed by the Department to use the Pennsylvania Preferred trademark with respect to Pennsylvania-produced fluid milk may, on an incidental, emergency or short-term basis, commingle Pennsylvania-produced fluid milk with other fluid milk provided that the licensee maintains a record of the commingling, including the dates and the quantities of Pennsylvania-produced fluid milk other fluid milk commingled. The records shall be retained by the licensee for the current month and each of the preceding 12 months and be made available for inspection by the Department upon written or verbal request of the Department.
(2) The Department may review the referenced records and determine whether the commingling is acceptable under paragraph (1). If the commingling was not acceptable, the Department will provide the licensee a written warning to refrain from commingling again. The Department may terminate the license if unacceptable commingling occurs a second time.
(3) If a person that is licensed by the Department to use the Pennsylvania Preferred trademark with respect to Pennsylvania-produced fluid milk seeks to commingle Pennsylvania-produced fluid milk with other fluid milk, he may, before the commingling occurs, contact the Department as described in paragraph (1) for confirmation as to whether the proposed commingling is acceptable to the Department.
[Pa.B. Doc. No. 13-1985. Filed for public inspection October 25, 2013, 9:00 a.m.]
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