Code of Maine Rules › 01 - DEPARTMENT OF AGRICULTURE, CONSERVATION AND FORESTRY › 015 - MAINE MILK COMMISSION › Chapter 20 - PREVENTION OF DESTRUCTIVE COMPETITION › Section 015-20-VII - COST OF MILK TO AN INTEGRATED OPERATION

Current through 2024-29, July 17, 2024
A. Overview. The cost of milk to an
				integrated operation shall be the integrated operation's raw product costs plus
				all expenses of the integrated operation directly and indirectly incurred in
				the receiving, processing, packaging, delivering/shipping, handling and selling
				milk. Examples of expenses directly and indirectly incurred in the receiving,
				processing, packaging, delivering/shipping, handling and selling milk are set
				forth in Section I(B) and W.
B. Raw
				Product Costs. The raw product costs of an integrated operation shall be
				determined as set forth in Section V.(B).
C. Actual Expenses: McClain Wholesale and
				Retail Cost Accounting Systems. The Commission may determine the expenses of an
				integrated operation directly and indirectly incurred in receiving, processing,
				packaging, delivering/shipping, handling and selling milk according to the
				McClain System contained in Rule 5A and the McClain System (retail) described
				in Section VI.(B). Procedures for the collection of McClain System reports,
				forms, and other information set forth in Sections V.(B) and (E) (1) and VI.(B)
				shall apply to integrated operations. Alternatively, an integrated operation
				may also submit a determination of its expenses by a cost accounting system
				other than the McClain System and request that the Commission use such other
				system to determine the integrated operation's expenses. An integrated
				operation submitting a determination of expenses by a cost accounting system
				other than McClain must demonstrate, and the Commission must find, that the
				cost accounting system is regularly used by the integrated operation in the
				conduct of its business, that it is based on generally accepted cost accounting
				principles and that it is at least equivalent to the McClain System in
				comprehensiveness and reliability as to expenses incurred in receiving,
				processing, packaging, delivering/shipping, handling and selling milk. Where
				these. findings are not made, the integrated operation shall prepare and file,
				within the time specified by the Commission, the McClain System reporting forms
				required by Rule 5A and the McClain System (retail) reports. Where these
				findings are made, the Commission will rely on the system submitted by the
				integrated operation as the appropriate demonstration of the integrated
				operation's actual expenses.
D.
				Imputed Expenses Based on Combined Dealer and Retail Margins.
1. The Commission may determine the imputed
				expenses of an integrated operation directly and indirectly incurred in
				receiving, processing, packaging, delivering/shipping, handling and selling
				milk by multiplying the integrated operation's retail selling price for the
				regulated product by that percentage shown on Table IV which most closely
				corresponds to the raw product cost per hundredweight, as adjusted for
				butterfat content under Section V.(B) (1) (b), that was paid by the integrated
				operation with respect to the regulated product.
2. Upon request of the Commission, an
				integrated operation shall promptly furnish to the Commission, within the time
				set by the Commission, all information necessary for it to determine the raw
				product cost paid by the integrated operation for the regulated product. In the
				absence of a timely response the Commission shall determine imputed expenses
				for purposes of this subsection on the basis of the Maine Class I price,
				subject to adjustment for butterfat content, which was in effect at the time of
				the transaction under examination.
3. Any proof of actual expenses lower than
				the imputed expenses of receiving, processing, packaging, delivering/shipping,
				handling and selling the regulated product as calculated by the Commission
				under this subsection shall be made by the integrated operation in the manner
				provided in C. for the determination by the Commission of actual expenses of
				integrated operations.