WSR 99-07-118

PROPOSED RULES

DEPARTMENT OF AGRICULTURE


[ Filed March 24, 1999, 9:22 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 99-03-045.

Title of Rule: Chapter 16-108 WAC, Washington state egg seals and assessments.

Purpose: To raise the assessment on shell eggs sold in intrastate commerce to provide a more adequate level of funding to operate the egg inspection program.

Other Identifying Information: Level of assessment to increase from $0.0025 cents per dozen eggs to $0.0026 cents effective June 30, 1999; $0.00268 cents effective July 1, 1999, sold in intrastate commerce.

Statutory Authority for Adoption: Chapter 69.25 RCW, Washington Wholesome Egg and Egg Products Act.

Statute Being Implemented: Partial implementation of RCW 69.25.250, remaining within the fiscal growth limits for FY 1999 and for FY 2000.

Summary: A rules review of this section was conducted in accordance with the Governor's Executive Order 97-02. The Department of Agriculture made the decision to retain the rule(s) and additionally to propose fee increases within the fiscal growth factor limits for FY 1999 and for FY 2000.

Reasons Supporting Proposal: This proposal is necessary to attempt to alleviate a deficit egg inspection fund balance so as to continue to provide the means under which adulterated or unwholesome eggs or egg products are discouraged from being sold in the marketplace, and the egg industry's reputation is protected.

Name of Agency Personnel Responsible for Drafting, Implementation and Enforcement: Andy Scarborough, 1111 Washington Street, Olympia, WA 98504, (360) 902-1830.

Name of Proponent: Washington State Department of Agriculture, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: The proposed rule would raise the shell egg assessment for graded eggs sold in intrastate commerce exclusive of the exemptions found under RCW 69.25.170 and in 69.25.290 from $0.0025 cents per dozen eggs to $0.0026 cents per dozen eggs effective June 30, 1999; $0.00268 cents per dozen eggs effective July 1, 1999.

The purpose of these rules are to set the level of assessment per dozen eggs sold in intrastate commerce at a level sufficient to carry out the inspection program, and to attempt to alleviate a minus $7,543.29 deficit egg inspection program fund balance as of January 31, 1999. The additional assessment dollars, estimated to be approximately $13,000 per fiscal year for the entire shell egg industry representing some seventy plus million dollars of total annual sales for shell eggs, will have minor impact to the overall industry.

Proposal Changes the Following Existing Rules: This proposal changes only a small section of these rules, WAC 16-108-010. This section was last amended January 29, 1986, and the assessment fee has remained at that level since that time. Changes the rate of shell egg assessment from the current rate of $0.0025 cents per dozen eggs to $0.0026 cents per dozen eggs effective June 30, 1999; $0.00268 cents per dozen eggs effective July 1, 1999.

No small business economic impact statement has been prepared under chapter 19.85 RCW. This rule will have a minor or negligible economic impact to small business. Most of the small businesses being mostly hobby businesses sell the eggs from their place of production to individual consumers, and are therefore exempt from assessments and regulation under WSDA and federal laws. Scenario: If eggs sold at .75 cents per dozen, and 133 dozen were sold; the total cost for the eggs would be 99 dollars and seventy-five cents. 133 dozen times the proposed higher fee increase of $0.00268 = .3564 cents per 100 dollars of sale. At the current rate of $0.0025 cents assessment rate per 100 dollars of sale the amount would = .3325 cents per 100 dollars of sale. The increased cost at the higher rate is insignificant, representing mere fractions of a cent per dozen eggs sold. The egg industry affected by this proposed fee increase in Washington state are mainly companies with 100,000 bird flock or larger. Some companies have more than one million bird flocks. These companies will pay the majority of the estimated $13,000 annual increase in revenue due to the volume they sell.

Section 201, chapter 403, Laws of 1995, does not apply to this rule adoption.

Hearing Location: Natural Resources Building, 2nd Floor, Room 259, 1111 Washington Street, Olympia, WA 98504, on April 28, 1999, at 10 a.m.

Assistance for Persons with Disabilities: Contact Julie Carlson, (360) 902-1880, by April 14, 1999, TDD (360) 902-1996, or (360) 902-1836.

Submit Written Comments to: Andy Scarborough, P.O. Box 42560, Olympia, WA 98504, fax (360) 902-2087, by April 27, 1999.

Date of Intended Adoption: May 28, 1999.

March 24, 1999

Candace A. Jacobs, DVM

Assistant Director

Food Safety and Animal Health Division

OTS-2944.1


AMENDATORY SECTION(Amending Order 1878, filed 1/29/86)

WAC 16-108-010
Rate.

A fee of ((two and one half mills)) $0.0026 cents effective June 30, 1999; $0.00268 cents effective July 1, 1999, per dozen eggs is hereby established for every egg handler or dealer who pays assessments monthly in lieu of seals and for Washington state egg seals and facsimile type Washington state egg seals imprinted on egg containers.

[Statutory Authority: RCW 69.25.250.  86-04-027 (Order 1878), 16-108-010, filed 1/29/86.  Statutory Authority: Chapter 69.25 RCW.  84-11-019 (Order 1824), 16-108-010, filed 5/11/84; Order 1489, 16-108-010, filed 1/31/77, effective 3/7/77; Order 1479, 16-108-010, filed 8/18/76; Order 895, Regulation 1, filed 9/26/62; Order 784, Regulation 1, effective 4/1/59.]

Washington State Code Reviser's Office