RULES AND REGULATIONS
PENNSYLVANIA MILK BOARD
[7 PA. CODE CH. 150]
Milk Marketing Fees
[54 Pa.B. 5728]
[Saturday, September 14, 2024]The Pennsylvania Milk Board (Board) proposes to amend Chapter 150 (relating to milk marketing fees) by increasing the license fees for milk dealers and one group of subdealers.
A. Effective Date
This proposed rulemaking will be effective upon final-form publication in the Pennsylvania Bulletin. There is no sunset provision.
B. Statutory Authority
The Milk Marketing Fee Act (act) (31 P.S. §§ 700k-1—700k-10.1) gives the Board the authority to impose and collect license fees. Section 3 of the act (31 P.S. § 700k-3) addresses milk dealer and milk subdealer fees generally. Section 4 of the act (31 P.S. § 700k-4) addresses milk dealer license fees for milk dealers not engaged in the milk business at the beginning of the license period.
C. Purpose and Explanation
The Board is self-funded, primarily by license fees. The Board has not received any general fund appropriation since Fiscal Year 1996-1997. License fees and other funds received by the Board are paid into the State Treasury and placed in the Milk Marketing Fund (Fund). Despite the Board's careful stewardship, expenses have increased and are projected to continue to increase, while income is not. The Fund is being eroded by the resulting deficits. Without this fee increase, the Board's financial viability will become uncertain.
D. Description of Proposed Amendments
The Board licenses approximately 200—205 milk dealers at any given time, with normal industry turnover. This amendment increases the per hundredweight fee milk dealers pay (the fixed license fee remains unchanged). The fee for price-controlled milk will increase from $0.060 to $0.075 per hundredweight. The fee for non-price-controlled milk will increase from $0.0064 to $0.0071 per hundredweight.
The Board licenses approximately 140—150 milk subdealers at any given time, with normal industry turnover. Subdealers pay a fixed license fee, which remains unchanged. Subdealers also pay a volume-based fee (designated as the ''quart-equivalent fee''). When the Board last amended the subdealer quart-equivalent fee for license year 2020-2021, one volume tier was inadvertently omitted. This amendment will impact four subdealers, increasing their quart-equivalent fee by $50 annually.
E. Fiscal and Administrative Impact
Milk dealers and four milk subdealers are the persons and parties affected by this proposed rulemaking.
The fee increase will result in additional revenue to the Board. The milk dealers are projected to pay a combined total of $299,925 more in license year 2025-2026, $266,096 more in license year 2026-2027, $233,282 more in license year 2027-2028 and $201,453 in license year 2028-2029. The decreases in increased license fees are due to projected declining volumes of price-controlled milk.
The milk subdealers will pay $50 more, for a combined total of $200 in license year 2025-2026 and subsequent license years.
These fees are not new fees—they are increases in existing fees. Therefore, the administrative impact is not expected to be significant.
F. Public Hearing
A public hearing was held on April 3, 2024. Notice of the hearing was published at 53 Pa.B. 3679 (July 8, 2023), posted on the Board's web site and sent to those who have requested e-mailed notification of Board hearings.
The hearing was attended by the Board and Board staff, an attorney representing the Pennsylvania Association of Dairy Cooperatives and the Executive Director of the Pennsylvania Association of Milk Dealers.
The Board Secretary testified regarding the need for the fee increase. There was no other testimony.
G. Regulatory Review
Under section 5(a) of the Regulatory Review Act (71 P.S. § 745.5(a)), on August 28, 2024, the Board submitted a copy of this proposed rulemaking and a copy of the Regulatory Analysis Form to the Independent Regulatory Review Commission (IRRC) and to the chairperson of the Agriculture and Rural Affairs Committee of the Senate and the chairperson of the Agriculture and Rural Affairs Committee of the House of Representatives. 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 after the close of the public comment period. The comments, recommendations or objections must specify the regulatory review criteria in section 5.2 of the Regulatory Review Act (71 P.S. § 745.5b) that have not been met. The Regulatory Review Act specifies detailed procedures for review, prior to final-form publication of this proposed rulemaking, by the Board, the General Assembly and the Governor.
H. Public Comments and Contact Person
Interested persons are invited to submit written comments, suggestions, support or objections about this proposed rulemaking to Doug Eberly, Chief Counsel, Pennsylvania Milk Board, 2301 North Cameron Street, Harrisburg, PA 17110, ra-pmmb@pa.gov within 30 days after publication in the Pennsylvania Bulletin. Individuals who require this information in a different format may call (717) 787-4194 or (800) 654-5984 which is the Pennsylvania Hamilton Relay Service for TDD users.
ROBERT N. BARLEY,
ChairpersonFiscal Note: 47-21. No fiscal impact; recommends adoption.
Annex A
TITLE 7. AGRICULTURE PART VI. PENNSYLVANIA MILK [MARKETING] BOARD
CHAPTER 150. MILK MARKETING FEES
LICENSE FEES OF MILK DEALERS § 150.12. Hundredweight fees.
(a) In addition to the fixed fee imposed under § 150.11 (relating to fixed fees), a milk dealer that was licensed for the entire calendar year preceding license renewal shall pay an annual hundredweight fee as set forth in paragraphs (1) and (2).
(1) For milk for which the Board has fixed a minimum wholesale or retail price, received, produced or brought into this Commonwealth during the calendar year preceding the period for which the license is issued, the fee is [$.060] $.075 per hundredweight.
(2) For milk for which the Board has not fixed a minimum wholesale or retail price, received, produced or brought into this Commonwealth during the calendar year preceding the period for which the license is issued, the fee is [$.0064] $.0071 per hundredweight.
(b) In addition to the fixed fee imposed under § 150.11, a milk dealer that was not licensed for the entire calendar year preceding license application or renewal shall pay a monthly hundredweight fee as set forth in paragraphs (1) and (2). Monthly payments shall continue until the milk dealer has been licensed for an entire calendar year and for each month thereafter until the next license year begins. Annual payments shall then commence under subsection (a).
(1) For milk for which the Board has fixed a minimum wholesale or retail price, received, produced or brought into this Commonwealth during the preceding month, the fee is [$.060] $.075 per hundredweight.
(2) For milk for which the Board has not fixed a minimum wholesale or retail price, received, produced or brought into this Commonwealth during the preceding month, the fee is [$.0064] $.0071 per hundredweight.
* * * * *
LICENSE FEES OF MILK SUBDEALERS § 150.22. Quart-equivalent fee.
(a) In addition to the fixed fee imposed under § 150.21(b) (relating to fixed fees), an applicant for annual renewal of a subdealer's license shall pay an annual quart-equivalent fee calculated by dividing the total quarts of milk sold during the previous calendar year by the number of months in which the subdealer engaged in business. The Board will assess the fee in accordance with the following schedule:
Ave. Qts. Sold Per Month Annual Fee * * * * * 120,000—149,999 [200.00] 250.00
* * * * *
[Pa.B. Doc. No. 24-1287. Filed for public inspection September 13, 2024, 9:00 a.m.]
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