‘‘§ 9. EQUITABLE FARM PRICES
‘‘(a) The powers granted in this section and section
ten shall apply only to the establishment of a compact
over-order price, so long as federal milk marketing orders
remain in effect in the region. In the event that any or
all such orders are terminated, this article shall authorize
the commission to establish one or more commission mar-
keting orders, as herein provided, in the region or parts
thereof as defined in the order.
‘‘(b) A compact over-order price established pursuant
to this section shall apply only to Class I milk. Such com-
pact over-order price shall not exceed one dollar and fifty
cents per gallon at Atlanta, Ga., however, this compact
over-order price shall be adjusted upward or downward at
other locations in the region to reflect differences in min-
imum federal order prices. Beginning in nineteen hundred
ninety, and using that year as a base, the foregoing one
dollar fifty cents per gallon maximum shall be adjusted
annually by the rate of change in the Consumer Price
Index as reported by the Bureau of Labor Statistics of
the United States Department of Labor. For purposes of
the pooling and equalization of an over-order price, the
value of milk used in other use classifications shall be cal-
culated at the appropriate class price established pursuant
to the applicable federal order or state dairy regulation
and the value of unregulated milk shall be calculated in
relation to the nearest prevailing class price in accordance
with and subject to such adjustments as the commission
may prescribe in regulations.
‘‘(c) A commission marketing order shall apply to all
classes and uses of milk.
‘‘(d) The commission is hereby empowered to estab-
lish a compact over-order price for milk to be paid by pool
plants and partially regulated plants. The commission is
also empowered to establish a compact over-order price to
be paid by all other handlers receiving milk from pro-
ducers located in a regulated area. This price shall be es-
tablished either as a compact over-order price or by one
or more commission marketing orders. Whenever such a
price has been established by either type of regulation, the
legal obligation to pay such price shall be determined sole-
ly by the terms and purpose of the regulation without re-
gard to the situs of the transfer of title, possession or any
other factors not related to the purposes of the regulation
and this compact. Producer-handlers as defined in an ap-
plicable federal market order shall not be subject to a com-
pact over-order price. The commission shall provide for
similar treatment of producer-handlers under commission
marketing orders.
‘‘(e) In determining the price, the commission shall
consider the balance between production and consumption
of milk and milk products in the regulated area, the costs
of production including, but not limited to the price of
feed, the cost of labor including the reasonable value of
the producer’s own labor and management, machinery ex-
pense, and interest expense, the prevailing price for milk
outside the regulated area, the purchasing power of the
public and the price necessary to yield a reasonable return
to the producer and distributor.
‘‘(f) When establishing a compact over-order price,
the commission shall take such other action as is necessary
and feasible to help ensure that the over-order price does
not cause or compensate producers so as to generate local
production of milk in excess of those quantities necessary
to assure consumers of an adequate supply for fluid pur-
poses.
‘‘(g) The commission shall whenever possible enter
into agreements with state or federal agencies for ex-
change of information or services for the purpose of reduc-
ing regulatory burden and cost of administering the com-
pact. The commission may reimburse other agencies for
the reasonable cost of providing these services.
‘‘§ 10. OPTIONAL PROVISIONS FOR PRICING ORDER
‘‘Regulations establishing a compact over-order price
or a commission marketing order may contain, but shall
not be limited to any of the following:
‘‘(1) Provisions classifying milk in accordance
with the form in which or purpose for which it is
used, or creating a flat pricing program.
‘‘(2) With respect to a commission marketing
order only, provisions establishing or providing a
method for establishing separate minimum prices for
each use classification prescribed by the commission,
or a single minimum price for milk purchased from
producers or associations of producers.
‘‘(3) With respect to an over-order minimum
price, provisions establishing or providing a method
for establishing such minimum price for Class I
milk.
‘‘(4) Provisions for establishing either an over-
order price or a commission marketing order may
make use of any reasonable method for establishing
such price or prices including flat pricing and for-
mula pricing. Provision may also be made for loca-
tion adjustments, zone differentials and for competi-
tive credits with respect to regulated handlers who
market outside the regulated area.
‘‘(5) Provisions for the payment to all pro-
ducers and associations of producers delivering milk
to all handlers of uniform prices for all milk so deliv-
ered, irrespective of the uses made of such milk by
the individual handler to whom it is delivered, or for
the payment of producers delivering milk to the
same handler of uniform prices for all milk delivered
by them.
‘‘(A) With respect to regulations estab-
lishing a compact over-order price, the commis-
sion may establish one equalization pool within
the regulated area for the sole purpose of equal-
izing returns to producers throughout the regu-
lated area.
‘‘(B) With respect to any commission mar-
keting order, as defined in section two, subdivi-
sion three, which replaces one or more termi-
nated federal orders or state dairy regulations,
the marketing area of now separate state or
federal orders shall not be merged without the
affirmative consent of each state, voting
through its delegation, which is partly or wholly
included within any such new marketing area.
‘‘(6) Provisions requiring persons who bring
Class I milk into the regulated area to make com-
pensatory payments with respect to all such milk to
the extent necessary to equalize the cost of milk pur-
chased by handlers subject to a compact over-order
price or commission marketing order. No such provi-
sions shall discriminate against milk producers out-
side the regulated area. The provisions for compen-
satory payments may require payment of the dif-
ference between the Class I price required to be paid
for such milk in the state of production by a federal
milk marketing order or state dairy regulation and
the Class I price established by the compact over-
order price or commission marketing order.
‘‘(7) Provisions specially governing the pricing
and pooling of milk handled by partially regulated
plants.
‘‘(8) Provisions requiring that the account of
any person regulated under the compact over-order
price shall be adjusted for any payments made to or
received by such persons with respect to a producer
settlement fund of any federal or state milk mar-
keting order or other state dairy regulation within
the regulated area.
‘‘(9) Provision requiring the payment by han-
dlers of an assessment to cover the costs of the ad-
ministration and enforcement of such order pursu-
ant to Article VII, Section 18(a).
‘‘(10) Provisions for reimbursement to partici-
pants of the Women, Infants and Children Special
Supplemental Food Program of the United States
Child Nutrition Act of 1966.
‘‘(11) Other provisions and requirements as the
commission may find are necessary or appropriate to
effectuate the purposes of this compact and to pro-
vide for the payment of fair and equitable minimum
prices to producers.
‘‘ARTICLE V. RULEMAKING
PROCEDURE
‘‘§ 11. RULEMAKING PROCEDURE
‘‘Before promulgation of any regulations establishing
a compact over-order price or commission marketing
order, including any provision with respect to milk supply
under subsection 9(f), or amendment thereof, as provided
in Article IV, the commission shall conduct an informal
rulemaking proceeding to provide interested persons with
an opportunity to present data and views. Such rule-
making proceeding shall be governed by section four of
the Federal Administrative Procedure Act, as amended (5
U.S.C. § 553). In addition, the commission shall, to the
extent practicable, publish notice of rulemaking pro-
ceedings in the official register of each participating state.
Before the initial adoption of regulations establishing a
compact over-order price or a commission marketing order
and thereafter before any amendment with regard to
prices or assessments, the commission shall hold a public
hearing. The commission may commence a rulemaking
proceeding on its own initiative or may in its sole discre-
tion act upon the petition of any person including indi-
vidual milk producers, any organization of milk producers
or handlers, general farm organizations, consumer or pub-
lic interest groups, and local, state or federal officials.
‘‘§ 12. FINDINGS AND REFERENDUM
‘‘(a) In addition to the concise general statement of
basis and purpose required by section 4(b) of the Federal
Administrative Procedure Act, as amended (5 U.S.C.
§ 553(c)), the commission shall make findings of fact with
respect to:
‘‘(1) Whether the public interest will be served
by the establishment of minimum milk prices to
dairy farmers under Article IV.
‘‘(2) What level of prices will assure that pro-
ducers receive a price sufficient to cover their costs
of production and will elicit an adequate supply of
milk for the inhabitants of the regulated area and
for manufacturing purposes.
‘‘(3) Whether the major provisions of the order,
other than those fixing minimum milk prices, are in
the public interest and are reasonably designed to
achieve the purposes of the order.
‘‘(4) Whether the terms of the proposed re-
gional order or amendment are approved by pro-
ducers as provided in section thirteen.
‘‘§ 13. PRODUCER REFERENDUM
‘‘(a) For the purpose of ascertaining whether the
issuance or amendment of regulations establishing a com-
pact over-order price or a commission marketing order,
including any provision with respect to milk supply under
subsection 9(f), is approved by producers, the commission
shall conduct a referendum among producers. The ref-
erendum shall be held in a timely manner, as determined
by regulation of the commission. The terms and conditions
of the proposed order or amendment shall be described
by the commission in the ballot used in the conduct of
the referendum, but the nature, content, or extent of such
description shall not be a basis for attacking the legality
of the order or any action relating thereto.
‘‘(b) An order or amendment shall be deemed ap-
proved by producers if the commission determines that it
is approved by at least two-thirds of the voting producers
who, during a representative period determined by the
commission, have been engaged in the production of milk
the price of which would be regulated under the proposed
order or amendment.
‘‘(c) For purposes of any referendum, the commission
shall consider the approval or disapproval by any coopera-
tive association of producers, qualified under the provi-
sions of the Act of Congress of February 18, 1922, as
amended, known as the Capper-Volstead Act, bona fide
engaged in marketing milk, or in rendering services for
or advancing the interests of producers of such com-
modity, as the approval or disapproval of the producers
who are members or stockholders in, or under contract
with, such cooperative association of producers, except as
provided in subdivision (1) hereof and subject to the provi-
sions of subdivision (2) through (5) hereof.
‘‘(1) No cooperative which has been formed to
act as a common marketing agency for both coopera-
tives and individual producers shall be qualified to
block vote for either.
‘‘(2) Any cooperative which is qualified to block
vote shall, before submitting its approval or dis-
approval in any referendum, give prior written notice
to each of its members as to whether and how it in-
tends to cast its vote. The notice shall be given in
a timely manner as established, and in the form pre-
scribed, by the commission.
‘‘(3) Any producer may obtain a ballot from the
commission in order to register approval or dis-
approval of the proposed order.
‘‘(4) A producer who is a member of a coopera-
tive which has provided notice of its intent to ap-
prove or not to approve a proposed order, and who
obtains a ballot and with such ballot expresses his
approval or disapproval of the proposed order, shall
notify the commission as to the name of the coopera-
tive of which he or she is a member, and the com-
mission shall remove such producer’s name from the
list certified by such cooperative with its corporate
vote.
‘‘(5) In order to insure that all milk producers
are informed regarding the proposed order, the com-
mission shall notify all milk producers that an order
is being considered and that each producer may reg-
ister his approval or disapproval with the commis-
sion either directly or through his or her cooperative.
‘‘§ 14. TERMINATION OF OVER-ORDER PRICE OR MAR-
KETING ORDER
‘‘(a) The commission shall terminate any regulations
establishing an over-order price or commission marketing
order issued under this article whenever it finds that such
order or price obstructs or does not tend to effectuate the
declared policy of this compact.
‘‘(b) The commission shall terminate any regulations
establishing an over-order price or a commission mar-
keting order issued under this article whenever it finds
that such termination is favored by a majority of the pro-
ducers who, during a representative period determined by
the commission, have been engaged in the production of
milk the price of which is regulated by such order; but
such termination shall be effective only if announced on
or before such date as may be specified in such marketing
agreement or order.
‘‘(c) The termination or suspension of any order or
provision thereof, shall not be considered an order within
the meaning of this article and shall require no hearing,
but shall comply with the requirements for informal rule-
making prescribed by section four of the Federal Adminis-
trative Procedure Act, as amended (5 U.S.C. § 553).
‘‘ARTICLE VI. ENFORCEMENT
‘‘§ 15. RECORDS; REPORTS; ACCESS TO PREMISES
‘‘(a) The commission may by rule and regulation pre-
scribe record keeping and reporting requirements for all
regulated persons. For purposes of the administration and
enforcement of this compact, the commission is authorized
to examine the books and records of any regulated person
relating to his or her milk business and for that purpose,
the commission’s properly designated officers, employees,
or agents shall have full access during normal business
hours to the premises and records of all regulated persons.
‘‘(b) Information furnished to or acquired by the
commission officers, employees, or its agents pursuant to
this section shall be confidential and not subject to disclo-
sure except to the extent that the commission deems dis-
closure to be necessary in any administrative or judicial
proceeding involving the administration or enforcement of
this compact, an over-order price, a compact marketing
order, or other regulations of the commission. The com-
mission may promulgate regulations further defining the
confidentiality of information pursuant to this section.
Nothing in this section shall be deemed to prohibit (i) the
issuance of general statements based upon the reports of
a number of handlers, which do not identify the informa-
tion furnished by any person, or (ii) the publication by
direction of the commission of the name of any person vio-
lating any regulation of the commission, together with a
statement of the particular provisions violated by such
person.
‘‘(c) No officer, employee, or agent of the commission
shall intentionally disclose information, by inference or
otherwise, which is made confidential pursuant to this sec-
tion. Any person violating the provisions of this section
shall, upon conviction, be subject to a fine of not more
than one thousand dollars or to imprisonment for not
more than one year, or to both, and shall be removed from
office. The commission shall refer any allegation of a viola-
tion of this section to the appropriate state enforcement
authority or United States Attorney.
‘‘§ 16. SUBPOENA; HEARINGS AND JUDICIAL REVIEW
‘‘(a) The commission is hereby authorized and em-
powered by its members and its properly designated offi-
cers to administer oaths and issue subpoenas throughout
all signatory states to compel the attendance of witnesses
and the giving of testimony and the production of other
evidence.
‘‘(b) Any handler subject to an order may file a writ-
ten petition with the commission stating that any such
order or any provision of any such order or any obligation
imposed in connection therewith is not in accordance with
law and praying for a modification thereof or to be ex-
empted therefrom. He shall thereupon be given an oppor-
tunity for a hearing upon such petition, in accordance with
regulations made by the commission. After such hearing,
the commission shall make a ruling upon the prayer of
such petition which shall be final, if in accordance with
law.
‘‘(c) The district courts of the United States in any
district in which such handler is an inhabitant, or has his
principal place of business, are hereby vested with jurisdic-
tion to review such ruling, provided a complaint for that
purpose is filed within thirty days from the date of the
entry of such ruling. Service of process in such pro-
ceedings may be had upon the commission by delivering
to it a copy of the complaint. If the court determines that
such ruling is not in accordance with law, it shall remand
such proceedings to the commission with directions either
(1) to make such ruling as the court shall determine to
be in accordance with law, or (2) to take such further pro-
ceedings as, in its opinion, the law requires. The pendency
of proceedings instituted pursuant to this subdivision shall
not impede, hinder, or delay the commission from obtain-
ing relief pursuant to section seventeen. Any proceedings
brought pursuant to section seventeen, except where
brought by way of counterclaim in proceedings instituted
pursuant to this section, shall abate whenever a final de-
cree has been rendered in proceedings between the same
parties, and covering the same subject matter, instituted
pursuant to this section.
‘‘§ 17. ENFORCEMENT WITH RESPECT TO HANDLERS
‘‘(a) Any violation by a handler of the provisions of
regulations establishing an over-order price or a commis-
sion marketing order, or other regulations adopted pursu-
ant to this compact shall:
‘‘(1) Constitute a violation of the laws of each
of the signatory states. Such violation shall render
the violator subject to a civil penalty in an amount
as may be prescribed by the laws of each of the par-
ticipating states, recoverable in any state or federal
court of competent jurisdiction. Each day such viola-
tion continues shall constitute a separate violation.
‘‘(2) Constitute grounds for the revocation of li-
cense or permit to engage in the milk business under
the applicable laws of the participating states.
‘‘(b) With respect to handlers, the commission shall
enforce the provisions of this compact, regulations estab-
lishing an over-order price, a commission marketing order
or other regulations adopted hereunder by:
‘‘(1) Commencing an action for legal or equi-
table relief brought in the name of the commission
of any state or federal court of competent jurisdic-
tion; or
‘‘(2) Referral to the state agency for enforce-
ment by judicial or administrative remedy with the
agreement of the appropriate state agency of a par-
ticipating state.
‘‘(c) With respect to handlers, the commission may
bring an action for injunction to enforce the provisions
of this compact or the order or regulations adopted there-
under without being compelled to allege or prove that an
adequate remedy of law does not exist.
‘‘ARTICLE VII. FINANCE
‘‘§ 18. FINANCE OF START-UP AND REGULAR COSTS
‘‘(a) To provide for its start-up costs, the commission
may borrow money pursuant to its general power under
section six, subdivision (d), paragraph four. In order to
finance the costs of administration and enforcement of
this compact, including payback of start-up costs, the
commission is hereby empowered to collect an assessment
from each handler who purchases milk from producers
within the region. If imposed, this assessment shall be col-
lected on a monthly basis for up to one year from the date
the commission convenes, in an amount not to exceed
$.015 per hundredweight of milk purchased from pro-
ducers during the period of the assessment. The initial as-
sessment may apply to the projected purchases of handlers
for the two-month period following the date the commis-
sion convenes. In addition, if regulations establishing an
over-order price or a compact marketing order are adopt-
ed, they may include an assessment for the specific pur-
pose of their administration. These regulations shall pro-
vide for establishment of a reserve for the commission’s
ongoing operating expenses.
‘‘(b) The commission shall not pledge the credit of
any participating state or of the United States. Notes
issued by the commission and all other financial obliga-
tions incurred by it, shall be its sole responsibility and no
participating state or the United States shall be liable
therefor.
‘‘§ 19. AUDIT AND ACCOUNTS
‘‘(a) The commission shall keep accurate accounts of
all receipts and disbursements, which shall be subject to
the audit and accounting procedures established under its
rules. In addition, all receipts and disbursements of funds
handled by the commission shall be audited yearly by a
qualified public accountant and the report of the audit
shall be included in and become part of the annual report
of the commission.
‘‘(b) The accounts of the commission shall be open
at any reasonable time for inspection by duly constituted
officers of the participating states and by any persons au-
thorized by the commission.
‘‘(c) Nothing contained in this article shall be con-
strued to prevent commission compliance with laws relat-
ing to audit or inspection of accounts by or on behalf of
any participating state or of the United States.
‘‘ARTICLE 
VIII. 
ENTRY 
INTO
FORCE; 
ADDITIONAL 
MEM-
BERS AND WITHDRAWAL
‘‘§ 20. ENTRY INTO FORCE; ADDITIONAL MEMBERS
‘‘The compact shall enter into force effective when
enacted into law by any three states of the group of states
composed of Alabama, Arkansas, Florida, Georgia, Ken-
tucky, Louisiana, Maryland, Mississippi, North Carolina,
Oklahoma, South Carolina, Tennessee, Texas, Virginia
and West Virginia and when the consent of Congress has
been obtained.
‘‘§ 21. WITHDRAWAL FROM COMPACT
‘‘Any participating state may withdraw from this
compact by enacting a statute repealing the same, but no
such withdrawal shall take effect until one year after no-
tice in writing of the withdrawal is given to the commis-
sion and the governors of all other participating states.
No withdrawal shall affect any liability already incurred
by or chargeable to a participating state prior to the time
of such withdrawal.
‘‘§ 22. SEVERABILITY
‘‘If any part or provision of this compact is adjudged
invalid by any court, such judgment shall be confined in
its operation to the part or provision directly involved in
the controversy in which such judgment shall have been
rendered and shall not affect or impair the validity of the
remainder of this compact. In the event Congress consents
to this compact subject to conditions, said conditions shall
not impair the validity of this compact when said condi-
tions are accepted by three or more compacting states. A
compacting state may accept the conditions of Congress
by implementation of this compact.’’.
SEC. 202. RESERVATION OF RIGHTS.
The right to alter, amend, or repeal this title is re-
served.
Æ