Brief Description: Increasing the powers of the state agricultural commodity commissions.

Brief Summary of Bill

• Allows commodity commissions to request and audit producer records to determine whether assessments have been paid.

• Allows commodity commissions to acquire and own intellectual property and to collect royalties from commission-funded research.

• References statutes relating to management and investment of state funds in provisions authorizing investment of commodity commission funds.

Majority Report: Do pass. Signed by 13 members: Representatives Linville, Chair; Rockefeller, Vice Chair; Schoesler, Ranking Minority Member; Holmquist, Assistant Ranking Minority Member; Kristiansen, Assistant Ranking Minority Member; Chandler, Eickmeyer, Grant, Hunt, McDermott, Orcutt, Quall and Sump.

A commodity commission may be established for a particular agricultural commodity. Some commodity commissions are created directly by statute. Some examples of commodities for which commissions have been created directly in statute are apple advertising, dairy products, and beef. A commodity commission also may be established according to the requirements of the Washington Agricultural Enabling Act. Commodity commissions have been created in this manner for wheat, potato, fryers, barley, and other commodities.

Another entity created for a particular commodity is a commodity board. A commodity board is created according to the Washington State Agricultural Enabling Act. Some examples of commodities for which boards have been created are hops, cranberries, asparagus, and turfgrass seed.

A commodity commission established according to the Washington Agricultural Enabling Act is created through the Department of Agriculture's issuance of a marketing order, which is adopted as a rule. Commodity commissions may be created in this manner to:

Statutory provisions specify procedural and other requirements for petitioning for a marketing order and for issuing, amending, and terminating a marketing order.

A commodity commission established according to the Washington Agricultural Enabling Act has the powers and duties specified in the marketing order creating it. In addition to those powers and among other powers specified in statute, a commodity commission may elect officers, adopt rules, administer and enforce the provisions of the marketing order, acquire property, borrow money, expend funds, enter into contracts, and engage in fund raising.

The state and its agencies are authorized to invest funds in various investment vehicles, including bonds, mutual funds, and money markets funds. State statutes specify requirements for investment and management of these state funds. The commodity commissions statutes authorize commodity commissions to invest in savings or time deposits in banks, trust companies, and mutual savings banks or according to other authority for investment of these funds.

Additional authority is granted to commodity commissions created under the Washington Agricultural Enabling Act. In addition to other powers specified in statute, a commodity commission created in this manner may:

• request and audit records of producers or handlers of the affected commodity to determine whether the appropriate assessment has been paid;

• acquire or own intellectual property rights, licenses, or patents related to the affected commodity; and

• collect royalties resulting from commission-funded research related to the affected commodity.

Provisions regarding marketing orders for commodity commissions are amended. Among other purposes, marketing orders may be made for commodity commissions to assist and cooperate with the Department of Agriculture or any other federal, state, or local agency in investigating and controlling exotic pests and diseases that could damage or affect trade of the affected commodity.

The provision authorizing commodity commissions to invest funds according to authority other than the commodity commission statutes is amended to reference statutes specifying requirements for management and investment of state funds.

Effective Date: The bill takes effect ninety days after adjournment of session in which bill is passed.

Testimony For: The Office of the Attorney General (AG) and Washington State Auditor's Office (SAO) suggested the statutory changes in this bill. The Washington State Potato Commission reviewed the bill's language with the AG and the SAO and worked with the Department of Agriculture and the other affected commodity commissions on this bill.