On June 17, 2015,
the Pennsylvania House of Representatives Agricultural and Rural Affairs Committee
held an informational meeting on proposed House Bill 1265, regarding
transparency of Pennsylvania state-mandated milk premiums paid to dairy
farmers.
House Bill 1265 addresses
farmers concerns that they are not aware of whether they are being paid the
Pennsylvania state-mandated premium (“over-order premium”) on milk sales. The state over-order premium is currently
$1.85 per hundredweight, or in terms of gallons, .16 cents. The fee applies to every gallon of Class 1
fluid drinking milk that is produced, processed, and sold in Pennsylvania. Farmers currently lack a verification method
that the premium is being paid because payments made to the farmer do not
contain a separate line item identifying the over-order premium amount paid. The bill would make it mandatory for milk
dealers, as well as dairy cooperatives, to include distinct notification on the
payment form to inform the farmer how much they are being paid for the
State-mandated premium.
Testimony was heard
from both proponents and opponents of the bill.
Opponents of the bill discussed the administrative difficulties of implementing
the changes required by H.B. 1265. In
addition to implementation difficulties, they argued ample transparency already
exists so the bill would provide no extra benefit to the farmers. Proponents of the bill argued it would strengthen
trust between dairy farmers and cooperatives by fostering accountability and
transparency in payments received. It
would also assist the farmers in adequately managing their operations by
knowing how much revenue will be coming in.
To watch the full legislative
hearing, click here.
Written by Katharine Richter - Research Assistant
June 18, 2015
