2005 California Food and Agricultural Code Sections 62560-62574 Article 4. Financing Plan

62560.  (a) The security charges provided for in Section 62561 shall
be collected until the secretary determines that the value of the
fund approximates 110 percent of the dollar amount of the total
purchases of milk of all classes then currently being paid for and
received in one month by the handler with the largest payment
obligation to producers for that month.
   (b) When the fund reaches the maximum provided for in this
section, the secretary shall discontinue collection of the security
charges.
   (c) If necessary, the secretary may reinstate the security charges
for the purpose of replacing periodically any withdrawals from the
fund and otherwise adding money to the fund in order that the maximum
value of the fund, as provided in this section, is maintained.
   (d) In consultation with the Milk Producers Security Trust Fund
Advisory Board, the secretary may consider and use alternative
financial instruments as an alternative to solely using security
charges to meet the financial security requirements of this section.
   (e) For the purposes of this section, "fund" includes the combined
value of any alternative financial instrument and security charge
collected.
62561.  (a) The following security charges shall be in effect for
any period for which the director has implemented collections under
this chapter:
   (1) (A) Five and seven-tenths mills per pound ($0.0057) for class
1 fat.
   (B) Two and three-tenths mills per pound ($0.0023) for class 1
solid-not-fat.
   (C) One-tenth mill per pound ($0.0001) for class 1 fluid.
   (2) (A)  Seven and one-tenth mills per pound ($0.0071) for classes
2 and 3 fat.
   (B) Two and nine-tenths mills per pound ($0.0029) for classes 2
and 3 solids-not-fat.
   (b) The director shall add the security charges to the prices
established for class 1, class 2, and class 3 milk established
pursuant to Chapter 2 (commencing with Section 61801).
62562.  Any increase in classified prices due to Section 62561 shall
be considered as part of the minimum prices required to be paid to
producers under other provisions of this code.  No other provisions
of this chapter modify the minimum payment requirements contained in
Chapter 1 (commencing with Section 61301) and Chapter 2 (commencing
with Section 61801).
62563.  Any handler subject to any pooling plan in effect under
Chapter 3 (commencing with Section 62700) shall continue to be
obligated for the minimum prices provided for in the stabilization
and marketing plans on the pooled usage of the handler.  However, any
part of the minimum prices which are attributable to the security
charges established pursuant to Section 62561 shall be deducted
before producer prices are determined under the pooling plan.
   Any handler subject to the pooling plan that receives milk which
is not included in the calculation of producer prices determined
under the pooling plan shall be obligated to pay the security charges
established pursuant to Section 62561 for any portion of that milk
which is assigned to class 1, class 2, and class 3 usage.
   The amount of any handler's obligation attributable to the
security charges established pursuant to Section 62561 shall be
remitted by the director to the fund by the end of the month
following the month the pool calculations were completed.
62564.  Any handler receiving milk not subject to any pooling plan
in effect pursuant to Chapter 3 (commencing with Section 62700) shall
be obligated to remit to the director any security charges in effect
pursuant to Section 62561 for class 1, class 2, and class 3 products
produced from the milk and may deduct the security charges from the
minimum prices required to be paid to producers.
62564.5.  Any producer-handler who has milk production that is
exempt pursuant to Section 62708, 62708.1, 62708.5, or 62722 from the
pooling plan in effect pursuant to Chapter 3 (commencing with
Section 62700) shall be exempt from any security charges established
pursuant to this article for that exempt production.
62565.  Security charges may be collected by the director through
direct payment or through pool accounting procedures established by
the director pursuant to Chapter 3 (commencing with Section 62700).
62566.  The director may add a penalty of 10 percent to amounts
which are not paid when due.
62567.  If any handler or producer-handler does not provide the
information necessary to determine the amount due, when required, the
director shall estimate the amount due from the records of the
department or from any other source of information which is
available.
62568.  The director may take all appropriate action against any
person to recover any unpaid amounts.  In any action, a declaration
by the director which states the amount required to be paid,
including penalty, is prima facie evidence of the delinquency.  The
presumption established by this section is a presumption affecting
the burden of proof.
62569.  Any money which is collected by the director pursuant to
this chapter shall be deposited in a bank or other depository which
is approved by the director.  Funds which are so collected are exempt
from Sections 11270 and 11272 of the Government Code and shall be
deposited and disbursed only to pay for milk produced and delivered
within this state, which has not been otherwise paid for, including
pool equalization fund obligations, attorney's fees and other costs
incurred in litigation involving the fund, expenses generated by the
auditing requirement imposed by Section 62570, expenses generated by
the use of alternative financial instruments pursuant to Section
62560, and for the costs set forth in Section 62573.  The expenditure
of those funds is exempt from Section 925.6 of the Government Code.
   Nothing in this section prevents the director from using the
increment received from investment, reinvestment, or deposit of money
specified in Section 62573, in the manner provided by Section 62574.
62570.  All fund activities shall be subject to an audit at least
once every two years by an auditing firm recommended by the board and
selected by the director.  A copy of the audit shall be delivered to
the director within 30 days after completion.
62571.  Notwithstanding Section 13340 of the Government Code, any
money which is collected by the director pursuant to this chapter is
hereby continuously appropriated to the director to carry out only
those purposes provided for in Section 62569.  The appropriation
which is made in this section is exempt from Section 16304 of the
Government Code.
62572.  Any money which is deposited pursuant to Section 62569,
which the director determines is available for investment, may be
invested or reinvested by the Treasurer in any of the securities
described in Article 1 (commencing with Section 16430) of Chapter 3
of Part 2 of Division 4 of Title 2 of the Government Code, or placed
in a depository as provided in Chapter 4 (commencing with Section
16500) of that part, and handled in the same manner as money in the
State Treasury.  For these purposes, the money may also be combined
with funds determined by the director to be available for investment
pursuant to Section 58939.
62573.  Any increment which is received from investment,
reinvestment, or deposit of money pursuant to Section 62572 shall be
deposited to the credit of the fund.  The Treasurer may deduct from
this remittance an amount equal to the reasonable costs incurred in
carrying out Section 62572 and this section or may bill the director
for the costs, and the director shall pay the costs from money
collected pursuant to this chapter.
   Nothing in this section prevents the director from using the
increment in a manner provided by Section 62574.
62574.  Immediately following the semiannual payment to the fund of
the increment provided in Section 62573, if the director determines
that there is a fund surplus, the director shall transfer an amount
equal  to the fund surplus to an account administered by the Milk
Stabilization Branch of the department to be used to reduce the
producer and handler assessments that would otherwise be imposed
pursuant to Article 14 (commencing with Section 62211) of Chapter 2.
One-half of the fund surplus so transferred shall be used to reduce
the obligation of producers and one-half shall be used to reduce the
obligation of handlers pursuant to that article.  If, at any time,
the director determines that the fund has fallen below the maximum
amount provided in Section 62560 or that a transfer pursuant to this
section would cause the fund to fall below the maximum amount
provided in Section 62560, the director shall cease to make any
transfer pursuant to this section until the time that a fund surplus
exists.