BILL ANALYSIS
SENATE COMMITTEE ON AGRICULTURE AND WATER RESOURCES
Jim Costa, Chairman
SB 1284 (Bowen)
As Amended April 5, 1999
Hearing Date: April 20, 1999
Fiscal: Yes
Consultant: Dan Webb
PURPOSE OF BILL:
To allow milk products that meet national nutritional standards,
but not those of California, to be sold in this state.
BACKGROUND:
The State of California has been directly involved in regulation
of its dairy industry since the 1930's, when free-falling prices
led to food shortages. Over time, most state governments have
reduced their involvement in milk nutritional standardization,
sanitation, pricing and pooling systems, instead deferring to
federal regulation. As a result, the national government now
provides oversight of all significant milk production outside of
California. In some states in which milk production is limited,
state regulation has been replaced with no governmental
oversight.
One aspect of milk regulation involves nutritional
standardization. The nutritional content of milk varies
naturally due to factors such as herd genetics, animal age, the
food ration, and weather (cows produce poorer quality milk when
stressed by cold, heat and humidity). California led the nation
in developing minimum quality and composition standards for
fluid milk in 1962 as a way of assuring consistent quality and
consumer value. Prior to that time, quality could vary greatly
month-to-month, brand-to-brand and carton-to-carton due to the
various production factors. The federal government followed
with its own minimum standards in 1973, but these were set at a
lower level to avoid a disadvantage to Southern and Southeastern
milk producers. Their cows are stressed much of the year by
heat and humidity, resulting in lower milk solids.
Natural cows' milk is typically 88% water and 12% solids
(approximately 3.5% butterfat and 8.5% nonfat solids).
California standards require the addition of natural nonfat milk
solids (condensed skim milk or nonfat dry powder) in its reduced
fat, lowfat, and nonfat milks. As butterfat is removed from
whole milk to make 2% and 1% milk, California requires the
addition of a like amount of nonfat solids to keep total solids
at 12%. Skim milk is brought up to a 9% solids level. The
addition of milk solids maintains texture and mouth feel while
increasing protein and calcium levels.
Below is a summary of the nutritional differences between the
two standards on the most significant milk nutrients. The
Department of Food and Agriculture has been asked to perform a
complete comparison of other nutrients.
Product: Calcium (mg) Protein (g)
Whole Milk 276 CA 261 US 7.9 CA 7.5 US
2% Reduced Fat 317 CA 261 US 9.1 CA 7.5 US
1% Lowfat 348 CA 261 US 10.0 CA 7.5 US
Nonfat 285 CA 261 US 8.2 CA 7.5 US
Out-of-state dairies that wish to do business in California are
obligated to meet our state's product standards. In 1998, 63
million gallons of out-of-state bulk milk were brought here for
packaging, manufacturing, and resale.
PROPOSED LAW:
This bill would allow milk products to be sold in this state that
meet national nutritional standards, but not those of California,
if the products include a statement to this effect and are
labeled in 20 point type "not fortified with milk solids". The
milk product packaging would also be required to have a chart
comparing the product's nutrients and their values to the
applicable California counterpart.
COMMENTS:
Congress provided, by specific authorization, the ability for
California to maintain its own milk nutritional standards. At
the time, it was not anticipated that the state might authorize
the sale of milk here that meets the national standard.
Therefore, one of the hurdles in making this proposed law work
would be conforming state law to federal regulations that, when
drawn, did not anticipate the situation presented today. A very
preliminary review of federal regulation results in possible
conformance issues:
1. Mandated phrases in the bill, "not fortified with milk
solids" and "this product meets all health and nutritional
standards established by the United States Food and Drug
Administration, but does not meet the fortified milk or milk
product standards established by California law" do not appear to
conform with prescribed phraseology found in 21CFR104.5(b) and
(d). The font sizes prescribed in the bill may also be out of
sync with federal regulation.
2. The requirement in the bill for a chart comparing products
meeting the California and federal standard is without precedent
in the highly regulated federal labeling program and may result
in a finding of misbranding under the federal Food, Drug, and
Cosmetic Act.
3. The allegation by some opponents that out-of-state milk would
have to be labeled as "imitation" if sold in California alongside
the nutritionally superior California products is apparently
unfounded. According to the Code of Federal Regulations,
21CFR101.3(e)(1), a food shall be deemed an "imitation" if it is
a substitute for and resembles another food but is nutritionally
inferior to that product. For example, a 20 milligram reduction
in calcium results in the product requiring an "imitation"
designation. The reduced calcium in out-of-state 2%, 1%, and
nonfat milk would, on its face, require that these products be
labeled as "imitation" if sold in California alongside the
nutritionally superior California products. However, federal
regulation makes a specific exception for inferior products that
otherwise meet the national standard for a commonly known food.
This legislation follows unsuccessful efforts in the Federal
District Court and Ninth Circuit Court of Appeals to characterize
California's milk standards as a barrier to interstate commerce.
The U.S. Supreme Court has refused to hear an appeal.
Supporters of this legislation say they want to maximize options
available to consumers, and that California's higher nutritional
standards serve as a barrier to out of state firms that would
like to market, in this state, milk of the same quality they sell
elsewhere. Opponents of the bill say that California often sets
higher standards than the rest of the nation, and cite as good
public policy milk standards requiring up to 33% more calcium.
The Senate Rules Committee requests that any do-pass motion
include a re-referral of the bill back to its jurisdiction.
SUPPORT:
3 individuals and the following:
California School Boards Association
California WIC Association
Children's Advocacy Institute
Mad About Milk
Orange County Community Development Council
Orange County Hunger Coalition
Shamrock Foods Company
United Organizations of Taxpayers Inc.
OPPOSED:
278 individuals and the following:
Agricultural Council of California
A & L Dairy
Arias Distributor Company
Arthur's Crystal Home Delivery
Betty Palmer Distributor
Bob's Bee Hive Market
Bob's Market
Bottle Shop
Boy's Market
California Farm Bureau Federation
California Grain & Feed Association
California Superintendent of Public Instruction Delaine Eastin
California Women for Agriculture
Centro Mart, Inc.
Chase Brothers Processors and Distributors
Chung Sun Market, Inc.
Compton's Markets
Crystal Cream and Butter Company
Crystal Dairy Foods, Inc.
Crystal Falls Mini Mart
Dairy Farmers of America
Dale's Liquor
Danish Creamery Association
Dillar Stores Inc.
Don's Market
Dutra Distributor
El Patio Grocery
El Rio Central Market
Encinal Market
Evergreen Markets, Inc.
Evergreen Markets, Inc.
Fairview Market
Foster & Crossman Distibutors
Foundation for Osteoporosis Research and Investigation
Fourth Street Market and Deli
Fresno County Office of Education
G & R Market
Gonnella's Country Mart
Heinz Dairy Delivery
Hidden Valley Dairy
Hoby's Market
Hoggard Dairy
Holiday Quality Foods
Hollandia Dairy
John's Sierra Market
Johnnie's Super Market
Knevelbaard Dairies
Korean American Grocers Association of California
La Mexicana
Land O'Lakes, Dairy Foods Western Region
Leonards Markets
Lincoln Ice and Beverage Company
Lost Nugget Market
Lowe's Market
M. F. Rosa Dairy
Margarita's Market
Marin County Farm Bureau
Mar-Val Food Stores
McColl's Dairy Products Company
McColl's Distributor
McConiga Distributor
Memorare Dairy
M.F. Rosa Dairy
Mike's Alta Sierra Market
Monte Vista Market, Inc.
Moorpark Central Market
Morning Glory, Inc.
Murphy's Supermarket
Northern California Grocers Association
NC Desserts
Old Frank's Market, Inc.
Oralias Bakery
Palomart, Inc
Payless Food Market
Pine Street Market
Poggi Distributing Company
Price Bros, Inc.
R & M Cattle
Rainbow Market
Raley's Supermarkets and Drug Centers
Ricks Uptown Market
R & N Market
San Diego Merchants Association
Sam's Market
Saticoy Liquor
Sepeda Brothers Producers
Servidio's Market
Seven-Eleven 14064 Franchise
Seven-Eleven 26688 Franchise
Seven-Eleven Roseville Franchise
Shoprite Market
Sonoma Market
The Alliance of Western Milk Producers
Tower Market
Treat's General Store
Trinity Dairy
Twain Harte Market, Inc.
United Markets
Uptown Market
Valadao Dairy
Ventura Central Market
VIC'S IGA Markets
Western United Dairymen
William's Distributor Company, Inc.