2023 New York Laws › AGM - Agriculture and Markets › Article 21-C - Northeast Interstate Dairy Compact › 258-KK - Northeast Interstate Dairy Compact.

§   258-kk.   Northeast  interstate  dairy  compact.    The  northeast
interstate dairy compact as set forth in this article is hereby  adopted
and  entered into with all jurisdictions joining therein. The compact is
as follows:
NORTHEAST INTERSTATE DAIRY COMPACT
ARTICLE I. STATEMENT OF PURPOSE, FINDINGS AND DECLARATION OF POLICY
§ 1.  Statement of purpose, findings and declaration of policy.
ARTICLE II. DEFINITIONS AND RULES OF CONSTRUCTION
§ 2.  Definitions.
§ 3.  Rules of construction.
ARTICLE III. COMMISSION ESTABLISHED
§ 4.  Commission established.
§ 5.  Voting requirements.
§ 6.  Administration and management.
§ 7.  Rulemaking power.
ARTICLE IV. POWERS OF THE COMMISSION
§ 8.  Powers to promote regulatory uniformity, simplicity, and  inter-
state cooperation.
§ 9.  Equitable farm prices.
§ 10. Optional provisions for pricing order.
ARTICLE V. RULEMAKING PROCEDURE
§ 11. Rulemaking procedure.
§ 12. Findings and referendum.
§ 13. Producer referendum.
§ 14. Termination of over-order price or marketing order.
ARTICLE VI. ENFORCEMENT
§ 15. Records, reports, access to premises.
§ 16. Subpoena, hearings and judicial review.
§ 17. Enforcement with respect to handlers.
ARTICLE VII. FINANCE
§ 18. Finance of start-up and regular costs.
§ 19. Audit and accounts.
ARTICLE VIII. ENTRY INTO FORCE; ADDITIONAL MEMBERS AND WITHDRAWAL
§ 20. Entry into force; additional members.
§ 21. Withdrawal from compact.
§ 22. Severability.
§ 23. Reservation of rights.
ARTICLE I. STATEMENT OF PURPOSE, FINDINGS AND DECLARATION OF POLICY
§ 1. Statement of purpose, findings and declaration of policy.
The  purpose  of  this  compact  is  to  recognize  by  constitutional
prerequisite the interstate character of the  northeast  dairy  industry
and  to  form  an  interstate  commission for the northeast region.  The
mission of the commission is to take such  steps  as  are  necessary  to
assure the continued viability of dairy farming in the northeast, and to
assure  consumers  of  an  adequate,  local supply of pure and wholesome
milk.
The participating states find and declare that the dairy  industry  is
the  paramount  agricultural activity of the northeast. Dairy farms, and
associated  suppliers,  marketers,  processors  and  retailers,  are  an
integral  component  of the region's economy. Their ability to provide a
stable, local supply of pure,  wholesome  milk  is  a  matter  of  great
importance to the health and welfare of the region.
The  participating  states further find that dairy farms are essential
to the region's rural communities and character. The farms preserve open
spaces, sculpt the landscape and provide the land base for  a  diversity
of  recreational  pursuits.  In  defining  the  rural  character  of our
communities and landscape, dairy farms also provide a major draw for our
tourist industries.
By entering into this compact, the participating  states  affirm  that
their  ability  to  regulate  the  price  which  northeast dairy farmers
receive for their product is essential to the public interest. Assurance
of a fair and equitable price for dairy farmers ensures their ability to
provide  milk  to  the  market  and  the vitality of the northeast dairy
industry, with all the associated benefits.
Recent, dramatic price fluctuations, with a pronounced downward trend,
threaten the viability and stability  of  the  northeast  dairy  region.
Historically,  individual  state regulatory action has been an effective
emergency remedy available to farmers confronting a  distressed  market.
The  federal  order  system,  implemented  by the Agricultural Marketing
Agreement Act  of  1937,  establishes  only  minimum  prices  for  dairy
products, without preempting the power of states to regulate milk prices
above  the  minimum levels so established. Based on this authority, each
state in the region has individually attempted to implement at least one
regulatory program in response to the current dairy industry crisis.
In  today's  regional  dairy  marketplace,  cooperative,  rather  than
individual   state  action  may  address  more  effectively  the  market
disarray. Under our constitutional system, properly  authorized,  states
acting  cooperatively  may  exercise  more  power to regulate interstate
commerce than they may assert individually without such  authority.  For
this  reason,  the participating states invoke their authority to act in
common agreement, with the consent of congress, under the compact clause
of the constitution.
In establishing their constitutional  regulatory  authority  over  the
region's  fluid  milk  market  by this compact, the participating states
declare their purpose that this compact  neither  displace  the  federal
order  system  nor  encourage  the merging of federal orders.   Specific
provisions of the compact itself set forth this basic principle.
Designed as a flexible mechanism  able  to  adjust  to  changes  in  a
regulated marketplace, the compact also contains a contingency provision
should  the  federal  order  system  be discontinued. In that event, the
interstate commission is  authorized  to  regulate  the  marketplace  in
replacement  of  the  order  system.  This contingent authority does not
anticipate such a change, however, and should not be so construed. It is
only provided should developments in the market other than establishment
of this compact result in discontinuance of the order system.
ARTICLE II. DEFINITIONS AND RULES OF CONSTRUCTION
§ 2. Definitions.
For  the  purposes  of  this  compact,  and  of  any  supplemental  or
concurring  legislation  enacted  pursuant  thereto,  except  as  may be
otherwise required by the context:
(a) "Commission" means the commission established by this compact.
(b) "Compact" means this interstate compact.
(c) "Region" means the territorial limits of the states which  are  or
become parties to this compact.
(d)  "Participating  state"  means a state which has become a party to
this compact by the enactment of concurring legislation.
(e) "Regulated area" means any area within the region governed by  and
defined  in  regulations  establishing  a  compact  over-order  price or
commission marketing order.
(f) "Pool plant" means any milk plant located in a regulated area.
(g) "Partially regulated plant" means a milk plant not  located  in  a
regulated  area  but  having  class  I distribution within such area, or
receipts from producers located in such area.    Commission  regulations
may  exempt  plants having such distribution or receipts in amounts less
than the limits defined therein.
(h) "Compact over-order price" means a minimum price  required  to  be
paid  to  producers  for  class  I milk established by the commission in
regulations adopted pursuant to sections nine and ten of  this  compact,
which  is  above the price established in federal marketing orders or by
state  farm price regulation in the regulated area. Such price may apply
throughout the region or in any part or parts thereof as defined in  the
regulations of the commission.
(i)  "Commission  marketing  order"  means  regulations adopted by the
commission pursuant to sections nine and ten of this compact in place of
a terminated federal marketing order or  state  dairy  regulation.  Such
order may apply throughout the region or in any part or parts thereof as
defined  in  the regulations of the commission. Such order may establish
minimum prices for any or all classes of milk.
(j) "Milk" means the lacteal secretion of cows and includes all  skim,
butterfat,  or  other constituents obtained from separation or any other
process. The term is used in its  broadest  sense  and  may  be  further
defined by the commission for regulatory purposes.
(k)  "Class I milk" means milk disposed of in fluid form or as a fluid
milk product, subject to  further  definition  in  accordance  with  the
principles  expressed  in  subdivision  (b)  of  section  three  of this
compact.
(l) "State dairy regulation"  means  any  state  regulation  of  dairy
prices,  and associated assessments, whether by statute, marketing order
or otherwise.
§ 3. Rules of construction.  (a) This compact shall not  be  construed
to  displace  existing  federal  milk  marketing  orders  or state dairy
regulation in the region but to supplement them. In the  event  some  or
all  federal orders in the region are discontinued, the compact shall be
construed to provide the commission the option to replace them with  one
or more commission marketing orders pursuant to this compact.
(b)  This compact shall be construed liberally in order to achieve the
purposes and intent enunciated in section one of this compact. It is the
intent of this compact to establish  a  basic  structure  by  which  the
commission   may   achieve   those  purposes  through  the  application,
adaptation and development of  the  regulatory  techniques  historically
associated  with  milk  marketing  and  to  afford  the commission broad
flexibility to devise regulatory mechanisms to achieve the  purposes  of
this  compact. In accordance with this intent, the technical terms which
are associated with market order  regulation  and  which  have  acquired
commonly  understood  general  meanings  are  not defined herein but the
commission may further define the terms used in this compact and develop
additional  concepts  and  define  additional  terms  as  it  may   find
appropriate to achieve its purposes.
ARTICLE III. COMMISSION ESTABLISHED
§ 4. Commission established.
There  is  hereby  created  a  commission  to  administer the compact,
composed of delegations from each state  in  the  region.  A  delegation
shall  include  not  less  than  three nor more than five persons.  Each
delegation shall include at least one dairy farmer who is engaged in the
production of milk at the time of appointment or reappointment, and  one
consumer  representative.  Delegation  members  shall  be  residents and
voters of, and subject to such confirmation process as is  provided  for
in,  the  appointing  state. Delegation members shall serve no more than
three consecutive terms with no single term of more than four years, and
be subject to removal for cause.   In  all  other  respects,  delegation
members   shall   serve  in  accordance  with  the  laws  of  the  state
represented. The compensation,  if  any,  of  the  members  of  a  state
delegation  shall  be  determined  and  paid  by  each  state, but their

expenses shall be paid by the commission. Each state delegation shall be
entitled to one vote in the conduct of the commission's affairs.
§ 5. Voting requirements.
All  actions  taken by the commission, except for the establishment or
termination of an over-order price or commission  marketing  order,  and
the adoption, amendment or rescission of the commission's by-laws, shall
be  by  majority  vote  of  the  delegations  present.  Establishment or
termination of an over-order price or commission marketing  order  shall
require  at  least  a  two-thirds  vote  of the delegations present. The
establishment of a  regulated  area  which  covers  all  or  part  of  a
participating  state  shall  require  also  the affirmative vote of that
state's delegation. A majority of the delegations from the participating
states shall constitute a quorum for the  conduct  of  the  commission's
business.
§ 6. Administration and management.
(a)  The commission shall elect annually from among the members of the
participating state delegations a chairperson, a vice-chairperson, and a
treasurer. The commission shall appoint an executive  director  and  fix
his  or  her duties and compensation. The executive director shall serve
at the pleasure of the commission, and,  together  with  the  treasurer,
shall  be  bonded  in  an  amount  determined  by  the  commission.  The
commission may establish through  its  by-laws  an  executive  committee
composed of one member elected by each delegation.
(b) The commission shall adopt by-laws for the conduct of its business
by a two-thirds vote, and shall have the power by the same vote to amend
and  rescind  these by-laws. The commission shall publish its by-laws in
convenient form with the appropriate agency or officer in  each  of  the
participating  states.  The by-laws shall provide for appropriate notice
to the delegations of all commission meetings and hearings  and  of  the
business  to  be  transacted  at  such meetings or hearings. Notice also
shall be given to other agencies or officers of participating states  as
provided by the laws of those states.
(c)  The  commission shall file an annual report with the secretary of
agriculture of the United States, and with  each  of  the  participating
states  by  submitting  copies  to  the  governor,  both  houses  of the
legislature,   and   the   head   of   the   state   department   having
responsibilities for agriculture.
(d)  In addition to the powers and duties elsewhere prescribed in this
compact, the commission shall have the power:
(1) to sue and be sued in any state or federal court;
(2) to have a seal and alter the same at pleasure;
(3) to acquire, hold, and dispose of real  and  personal  property  by
gift,  purchase,  lease,  license,  or  other  similar  manner,  for its
corporate purposes;
(4) to borrow money and to issue notes, to provide for the  rights  of
the  holders  thereof  and  to  pledge  the revenue of the commission as
security therefor, subject to the provisions of section eighteen of this
compact;
(5) to appoint such officers, agents, and employees  as  it  may  deem
necessary, prescribe their powers, duties, and qualifications; and
(6)  to create and abolish such offices, employments, and positions as
it deems necessary for the purposes of the compact and provide  for  the
removal,  term,  tenure,  compensation,  fringe  benefits,  pension, and
retirement rights of its officers and employees. The commission may also
retain personal services on a contract basis.
§ 7. Rulemaking power.
In addition to the power to promulgate a compact over-order  price  or
commission  marketing orders as provided by this compact, the commission

is further empowered to make  and  enforce  such  additional  rules  and
regulations  as  it  deems necessary to implement any provisions of this
compact, or to effectuate in any other  respect  the  purposes  of  this
compact.
ARTICLE IV. POWERS OF THE COMMISSION
§   8.  Powers  to  promote  regulatory  uniformity,  simplicity,  and
interstate cooperation.
The commission is hereby empowered to:
(a) Investigate or provide for  investigations  or  research  projects
designed   to   review   the   existing  laws  and  regulations  of  the
participating states, to consider their  administration  and  costs,  to
measure  their  impact on the production and marketing of milk and their
effects on the shipment of milk and milk products within the region.
(b) Prepare and transmit to the participating states model dairy  laws
and  regulations  dealing  with  the  inspection  of  farms  and plants,
sanitary  codes,  labels  for  dairy  products  and  their   imitations,
standards  for  dairy  products,  license  standards,  producer security
programs, and fair trade laws.
(c)  Study  and  recommend  to  the  participating  states  joint   or
cooperative  programs  for  the  administration  of  the  dairy laws and
regulations and to prepare estimates of cost  savings  and  benefits  of
such programs.
(d)   Encourage  the  harmonious  relationships  between  the  various
elements in the industry for the solution of  their  material  problems.
Conduct   symposiums   or   conferences  designed  to  improve  industry
relations, or a better understanding of problems.
(e) Prepare and release periodic reports on activities and results  of
the commission's efforts to the participating states.
(f)  Review  the  existing marketing system for milk and milk products
and recommend  changes  in  the  existing  structure  for  assembly  and
distribution  of  milk  which  may  assist,  improve,  or  promote  more
efficient assembly and distribution of milk.
(g) Investigate costs and charges for  producing,  hauling,  handling,
processing,  distributing,  selling and for all other services performed
with respect to milk.
(h) Examine current  economic  forces  affecting  producers,  probable
trends  in production and consumption, the level of dairy farm prices in
relation to costs, the financial conditions of dairy  farmers,  and  the
need  for  an  emergency  order  to relieve critical conditions on dairy
farms.
§ 9. Equitable farm prices.
(a) The powers granted in this section and section ten of this compact
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 marketing
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 over-order price shall not exceed
one  dollar  and  fifty  cents per gallon. Beginning in nineteen hundred
ninety, and using that year as a base,  the  foregoing  one  dollar  and
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 calculated 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 establish the minimum  price
for  milk  to be paid by pool plants, partially regulated plants and all
other handlers receiving milk from  producers  located  in  a  regulated
area.  This  price  shall  be established 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 solely by the terms and
purpose of the regulation without regard 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
applicable federal market order  shall  not  be  subject  to  a  compact
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  expense,  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 action as necessary and feasible to ensure that the over-order
price  does not create an incentive for producers to generate additional
supplies of milk.
(g) The commission shall whenever possible enter into agreements  with
state  or  federal  agencies for exchange of information or services for
the purpose of reducing regulatory burden and cost of administering  the
compact.  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:
(a) Provisions classifying milk in accordance with the form  in  which
or purpose for which it is used, or creating a flat pricing program.
(b)  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.
(c)   With   respect   to  an  over-order  minimum  price,  provisions
establishing or providing a method for establishing such  minimum  price
for class I milk.
(d)  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 formula
pricing. Provision may also  be  made  for  location  adjustments,  zone
differentials  and  for  competitive  credits  with respect to regulated
handlers who market outside the regulated area.
(e) Provisions for the payment to all producers  and  associations  of
producers delivering milk to all handlers of uniform prices for all milk

so  delivered,  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.
(1)  With  respect  to  regulations  establishing a compact over-order
price, the commission may establish one  equalization  pool  within  the
regulated  area  for the sole purpose of equalizing returns to producers
throughout the regulated area.
(2) With respect to any commission  marketing  order,  as  defined  in
subdivision  (i)  of  section two of this compact, which replaces one or
more terminated federal orders or state dairy regulation, 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.
(f) Provisions requiring persons who  bring  class  I  milk  into  the
regulated  area  to  make compensatory payments with respect to all such
milk to the extent necessary to equalize the cost of milk  purchased  by
handlers  subject  to a compact over-order price or commission marketing
order. No such provisions  shall  discriminate  against  milk  producers
outside the regulated area. The provisions for compensatory payments may
require  payment of the difference 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.
(g)  Provisions  specially  governing  the pricing and pooling of milk
handled by partially regulated plants.
(h) Provisions requiring that the  account  of  any  person  regulated
under a 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 marketing order or other  state  dairy
regulation within the regulated area.
(i)  Provisions  requiring the payment by handlers of an assessment to
cover the costs of the administration  and  enforcement  of  such  order
pursuant to subdivision (a) of section eighteen of this compact.
(j) Provisions for reimbursement to participants of the Women, Infants
and  Children  Special  Supplemental  Food  Program of the United States
Child Nutrition Act of 1966.
(k) Other provisions and requirements as the commission may  find  are
necessary  or appropriate to effectuate the purposes of this compact and
to provide 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 subdivision (f) of section nine of
this compact, or amendment thereof, as provided in article  IV  of  this
compact,  the commission shall conduct an informal rulemaking proceeding
to provide interested persons with an opportunity to  present  data  and
views.  Such  rulemaking proceeding shall be governed by section four of
the Federal Administrative Procedure Act,  as  amended  (5  U.S.C.  Sec.
553).  In  addition,  the  commission  shall, to the extent practicable,
publish notice of rulemaking proceedings 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 discretion act upon the petition of any person including individual
milk  producers, any organization of milk producers or handlers, general
farm organizations, consumer or public 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. Sec. 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 of this compact.
(2)  What  level  of prices will assure that producers 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 regional order or amendment are
approved by producers as provided in section thirteen of this compact.
§ 13. Producer referendum.
(a) For the purpose of ascertaining whether the issuance or  amendment
of  regulations  establishing a compact over-order price or a commission
marketing order, including any provision with  respect  to  milk  supply
under  subdivision  (f)  of section nine of this compact, is approved by
producers, the commission shall conduct a  referendum  among  producers.
The  referendum  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 approved 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  cooperative  association  of  producers,
qualified  under  the  provisions  of  the  act  of congress of February
eighteen,  nineteen  hundred  twenty-two,  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
commodity,  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 paragraph one of this
subdivision and subject to the provisions of paragraphs two, three, four
and five of this subdivision:
(1) No cooperative which has been formed to act as a common  marketing
agency for both cooperatives 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 disapproval in  any  referendum,  give  prior
written  notice  to each of its members as to whether and how it intends
to cast its vote. The notice shall  be  given  in  a  timely  manner  as
established, and in the form prescribed by the commission.
(3)  Any  producer may obtain a ballot from the commission in order to
register approval or disapproval of the proposed order.
(4)  A  producer  who  is a member of a cooperative which has provided
notice of its intent to approve 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 cooperative of  which  he  or  she  is  a  member,  and  the
commission  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
a proposed order, the commission shall notify all milk producers that an
order is being considered and that each producer may register his or her
approval  or  disapproval with the commission either directly or through
his or her cooperative.
§ 14. Termination of over-order price or marketing 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  marketing  order  issued  under  this
article whenever it finds that such termination is favored by a majority
of  the  producers 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  rulemaking  prescribed  by  section  four   of   the   Federal
Administrative Procedure Act, as amended (5 U.S.C. Sec. 553).
ARTICLE VI. ENFORCEMENT
§ 15. Records, reports, access to premises.
(a) The commission may by rule and regulation prescribe 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 disclosure except to the extent that the commission
deems disclosure 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  commission  may  promulgate  regulations  further
defining the confidentiality of information pursuant  to  this  section.
Nothing  in this section shall be deemed to prohibit (1) the issuance of
general statements based upon the reports of a number of handlers, which
do not identify the information furnished by  any  person,  or  (2)  the
publication  by  direction  of  the commission of the name of any person
violating 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 section.  Any  person  violating  the
provisions of this section shall upon conviction be subject to a fine of
not  more than one thousand dollars or by imprisonment for not more than
one  year,  or by both, and shall be removed from office. The commission
shall refer any allegation  of  a  violation  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 empowered by its members
and its properly designated  officers  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 written 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
exempted  therefrom.  He  shall  thereupon be given an opportunity 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  jurisdiction in equity to review such ruling,
provided a bill in equity for that purpose is filed within  thirty  days
from  the  date  of the entry of such ruling. Service of process in such
proceedings may be had upon the commission by delivering to it a copy of
the bill of 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 proceedings 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  obtaining  relief pursuant to
section seventeen of this compact.  Any proceedings brought pursuant  to
section  seventeen  of  this  compact  (except  where  brought by way of
counterclaim in proceedings instituted pursuant to this  section)  shall
abate  whenever  a final decree 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  commission  marketing  order,  or
other regulations adopted pursuant 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
participating states, recoverable in  any  state  or  federal  court  of
competent   jurisdiction.   Each  day  such  violation  continues  shall
constitute a separate violation.
(2) Constitute grounds for the revocation  of  license  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  establishing  an over-order
price,  a  commission  marketing  order  or  other  regulations  adopted
hereunder by:
(1)  Commencing an action for legal or equitable relief brought in the
name of the commission in  any  state  or  federal  court  of  competent
jurisdiction; or
(2)   With  the  agreement  of  the  appropriate  state  agency  of  a
participating state, by referral to the state agency for enforcement  by
judicial or administrative remedy.
(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  thereunder  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 paragraph four of subdivision (d) of
section six of  this  compact.    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 collected on a  monthly
basis  for  up  to one year from the date the commission convenes, in an
amount not to exceed one-tenth of one percent of the applicable  federal
market  order  blend  price  per  hundredweight  of  milk purchased from
producers during the period of the assessment.  The  initial  assessment
may  apply  to  the  projected  purchases  of handlers for the two-month
period following the date  the  commission  convenes.  In  addition,  if
regulations  establishing  an  over-order  price  or a compact marketing
order are adopted, they may  include  an  assessment  for  the  specific
purpose  of  their  administration.  These regulations shall provide 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   obligations  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 authorized by the commission.
(c)  Nothing  contained  in this article shall be construed to prevent
commission compliance with laws  relating  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 MEMBERS 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 Connecticut,
Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New
York, Pennsylvania, Rhode Island, Vermont  and  Virginia  and  when  the
consent  of  congress has been obtained. This compact shall also be open
to states which are contiguous to any of the named states  and  open  to
states which are contiguous to participating states.
§ 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 notice in writing of the withdrawal is given to the
commission  and  the  governors  of  all  other participating states. No
withdrawal shall affect any liability already incurred by or  chargeable
to a party 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.
Congress  reserves  the  right  to  amend  or  rescind this interstate
compact at any time.
§ 23. Reservation of rights.
(a) In general. The right to alter, amend, or repeal this  compact  is
expressly reserved.
(b)  Compensation  requirement. When an over-order price is in effect,
the  commission  established  in  this  compact  shall  compensate   the
commodity  credit  corporation before the end of the fiscal year for the
cost of any increased commodity credit corporation dairy purchases  that
result  from  projected  increased fluid milk production for that fiscal
year within the compact region in excess of the national average rate of
increase.