I 
112TH CONGRESS 
1ST SESSION H. R. 3372 
To amend the Agricultural Adjustment Act to deregulate the Federal milk 
marketing order program, to publish competitive milk price survey data, 
and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 4, 2011 
Mr. WALSH of Illinois introduced the following bill; which was referred to the 
Committee on Agriculture 
A BILL 
To amend the Agricultural Adjustment Act to deregulate 
the Federal milk marketing order program, to publish 
competitive milk price survey data, and for other pur-
poses. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Dairy Pricing Deregu-
lation Act’’. 
SEC. 2. REFORM OF FEDERAL MILK MARKETING ORDERS. 
(a) TERMS AND CONDITIONS OF MILK AND MILK 
PRODUCTS ORDERS.—Section 8c of the Agricultural Ad-
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justment Act (7 U.S.C. 608c), reenacted with amendments 
by the Agricultural Marketing Agreement Act of 1937, is 
amended— 
(1) in subsection (5)— 
(A) by striking paragraphs (C), (D), (H), 
(I), (J), and (K); 
(B) by amending paragraph (A) to read as 
follows: 
‘‘(A) Fixing a differential which all han-
dlers of milk used for fluid purposes shall pay 
with respect to such milk, and the time when 
payments shall be made, for milk purchased 
from producers or associations of producers. 
Such differential shall be uniform as to all such 
handlers, subject only to adjustment for the lo-
cations at which delivery of such milk is made 
to such handlers.’’; 
(C) by amending paragraph (B) to read as 
follows: 
‘‘(B) Providing for the payment to all pro-
ducers and associations of producers delivering 
milk to any fluid milk handler regulated by the 
order, or to any non-fluid milk handler which 
supplies milk to such fluid milk handler in con-
formity with such requirements as the Sec-
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retary may establish, a proportionate share, 
based on volume of delivered milk, of all dif-
ferentials required to be paid under paragraph 
(A) of this subsection (5), subject only to ad-
justment for the locations at which delivery of 
such milk is made.’’; 
(D) by amending paragraph (F) to read as 
follows: 
‘‘(F) Nothing contained in this subsection 
is intended or shall be construed to prevent a 
cooperative 
marketing 
association 
qualified 
under the provisions of the Act of Congress of 
February 18, 1922, known as the ‘Capper-Vol-
stead Act’ (7 U.S.C. 291 et seq.), engaged in 
making collective sales or marketing of milk or 
its products for the producers thereof, from 
blending the net proceeds of all of its sales of 
milk or its products in all markets, and making 
distribution thereof to its producers in accord-
ance with the contract between the association 
and its producers.’’; 
(E) by amending paragraph (L) to read as 
follows: 
‘‘(L) Providing that adjustments in pay-
ments by handlers under paragraph (A) need 
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not be the same as adjustments to producers 
under paragraph (B).’’; 
(F) by amending paragraph (M) to read as 
follows: 
‘‘(M)(i) 
APPLICATION
OF
REQUIRE-
MENTS.—Notwithstanding any other provision 
of this section, a milk handler described in 
clause (ii) shall be subject to all of the fluid 
milk differential requirements of a Federal milk 
marketing order issued pursuant to this section 
applicable to the county in which the plant of 
the handler is located, if the handler has pack-
aged fluid milk product route dispositions, or 
sales of packaged fluid milk products to other 
plants, in a marketing area located in a State 
that requires handlers to pay minimum prices 
for raw milk purchases. 
‘‘(ii) COVERED MILK HANDLERS.—Except 
as provided in clause (iv), clause (i) applies to 
a handler of Class I milk products (including a 
producer-handler or producer operating as a 
handler) that— 
‘‘(I) operates a plant that is located within 
the boundaries of a Federal order milk mar-
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keting area (as those boundaries are in effect as 
of April 11, 2006); 
‘‘(II) has packaged fluid milk product 
route dispositions, or sales of packaged fluid 
milk products to other plants, in a milk mar-
keting area located in a State that requires 
handlers to pay fluid milk differentials for raw 
milk purchases; and 
‘‘(III) is not otherwise obligated by a Fed-
eral milk marketing order, or a regulated milk 
pricing plan operated by a State, to pay min-
imum class prices or fluid milk differentials for 
the raw milk that is used for such dispositions 
or sales. 
‘‘(iii) OBLIGATION
TO
PAY
FLUID
MILK 
DIFFERENTIALS.—For 
purposes 
of 
clause 
(ii)(III), the Secretary may not consider a han-
dler of Class I milk products to be obligated by 
a Federal milk marketing order to pay fluid 
milk differentials for raw milk unless the han-
dler operates the plant as a fully regulated fluid 
milk distributing plant under a Federal milk 
marketing order. 
‘‘(iv) CERTAIN
HANDLERS
EXEMPTED.— 
Clause (i) does not apply to— 
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‘‘(I) a handler (otherwise described in 
clause (ii)) that operates a nonpool plant (as 
defined in section 1000.8(e) of title 7, Code of 
Federal Regulations, as in effect on the date of 
the enactment of this subparagraph); 
‘‘(II) a producer-handler (otherwise de-
scribed in clause (ii)) for any month during 
which the producer-handler has route disposi-
tions, and sales to other plants, of packaged 
fluid 
milk 
products 
equaling 
less 
than 
3,000,000 pounds of milk; or 
‘‘(III) a handler (otherwise described in 
clause (ii)) for any month during which— 
‘‘(aa) less than 25 percent of the total 
quantity of fluid milk products physically re-
ceived at the plant of the handler (excluding 
concentrated milk received from another plant 
by agreement for other than Class I use) is dis-
posed of as route disposition or is transferred 
in the form of packaged fluid milk products to 
other plants; or 
‘‘(bb) less than 25 percent in aggregate of 
the route disposition or transfers are in a mar-
keting area or areas located in one or more 
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States that require handlers to pay minimum 
prices for raw milk purchases.’’; and 
(G) by amending paragraph (N) to read as 
follows: 
‘‘(N) EXEMPTION
FOR
CERTAIN
MILK 
HANDLERS.—Notwithstanding any other provi-
sion of this section, no handler with distribution 
of Class I milk products in the marketing area 
described in Order No. 131 shall be exempt 
during any month from any fluid milk differen-
tial requirement established by the Secretary 
under this subsection if the total distribution of 
Class I products during the preceding month of 
any such handler’s own farm production ex-
ceeds 3,000,000 pounds.’’; and 
(2) by amending subsection (18) to read as fol-
lows: 
‘‘(18) FLUID MILK DIFFERENTIALS.—The Sec-
retary of Agriculture, in prescribing any term in any 
marketing agreement or order, or amendment there-
to, relating to milk or its products, if such term is 
to fix the differential to be paid to producers or as-
sociations of producers, shall fix such differential as 
follows. Such differentials shall during the first year 
after the effective date of the Dairy Pricing Deregu-
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lation Act be equal to the differentials for milk used 
for fluid purposes as they existed under federal milk 
marketing orders on January 1, 2011, subject to all 
location adjustments as they existed under federal 
milk marketing orders on such date. Such differen-
tials shall in each successive year be reduced by an 
amount equal to 20 percent of the differentials that 
existed during the first year after the effective date 
of such Act, and shall be discontinued in the fifth 
year after the effective date of such Act.’’. 
(b) CONFORMING AMENDMENT.—Section 10(b)(2)(i) 
of 
the 
Agricultural 
Adjustment 
Act 
(7 
U.S.C. 
610(b)(2)(i)), reenacted with amendments by the Agricul-
tural Marketing Agreement Act of 1937, is amended by 
striking ‘‘each handler subject thereto’’ and inserting 
‘‘each fluid milk handler subject thereto and each non- 
fluid milk handler which supplies milk to such fluid milk 
handler’’. 
(c) NOTICE AND COMMENT.—The Secretary of Agri-
culture shall use the notice and comment procedures pro-
vided in section 553 of title 5, United States Code, to im-
plement the requirements of the amendments made by 
subsection (a) of this section. 
(d) SURVEYS.— 
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(1) IN GENERAL.—The Secretary of Agriculture 
shall survey and publish on a regular basis data re-
garding the payments made by all handlers of milk 
used for any purpose for milk purchased from pro-
ducers or associations of producers. 
(2) BASES FOR PUBLICATION.—The Secretary 
shall publish such data on a national weighted-aver-
age basis and on a regional basis with respect to as 
many multi-state regions as the Secretary deter-
mines to be of practical use. 
(3) MANDATORY
PARTICIPATION.—Participa-
tion in such surveys by handlers shall be mandatory. 
SEC. 3. EFFECTIVE DATE. 
The amendments made by this Act shall be effective 
on the first day of the first month beginning one year after 
the date of the enactment of this Act. 
Æ 
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