California Food and Agricultural Code

§ 62560

FAC § 62560 Effective Jan 1, 2020Div. 21 · Part 3 · Ch. 2.5 · Art. 4

Statute text

(a)The security charges provided for in Section 62561 shall be collected until January 1, 2007. Unless otherwise permitted by this section, the secretary shall thereafter discontinue collection of the security charges. The fund shall consist of the fund cash, the value of any alternative financial instrument, and acceptable securities provided by handlers pursuant to subdivision (c).

(b)If, after January 1, 2007, payment of producer claims reduces the fund cash below thirty million dollars ($30,000,000), the secretary may resume collecting security charges in order that the fund cash is thereafter maintained at thirty million dollars ($30,000,000). Security charges necessary to return the fund cash to thirty million dollars ($30,000,000) shall, subject to subdivision (c), be collected from all handlers making purchases of eligible milk, including handlers who have posted acceptable securities pursuant to subdivision (c).

(c)If, in any month, 110 percent of any handler’s average monthly eligible milk purchases, computed over the preceding 12 months, unless the increase in value of eligible milk purchases is the result of substantial business expansion or the result of a merger or acquisition, in which case the 12-month computation requirement does not apply, exceeds the fund cash as of the end of that month, or thirty million dollars ($30,000,000), whichever is higher, the secretary shall require that handler to provide acceptable securities, as calculated consistent with subdivision (e), within 10 working days in an amount equal to the difference between the fund cash or thirty million dollars ($30,000,000), whichever is higher, and 110 percent of that handler’s average monthly eligible milk purchases. When handlers have provided acceptable securities covering the difference, the secretary shall not collect security charges from those handlers for the portion of their average monthly eligible milk purchases covered by acceptable securities. Shipments to handlers failing to provide acceptable securities within 10 working days of notice by the secretary of the obligation to post acceptable securities, as required by this subdivision, shall be listed by the secretary as ineligible for coverage under the fund pursuant to Section 62586.

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Legislative history

Amended by Stats. 2019, Ch. 304, Sec. 17. (AB 590) Effective January 1, 2020.