"NEW SECTION.  Sec. 1   (1) The production of potatoes within this state is in the public interest. It is vital to the continued economic well-being of the citizens of this state and their general welfare that its potato industry be encouraged by enabling producers of potatoes to help themselves in establishing orderly, fair, sound, efficient, and unhampered marketing, trade, grading, and standardization of the potatoes they produce.
     (2) It is in the public interest that support for the potato industry be clearly expressed, that adequate protection be given to the industry, and that the industry's collective activities and operations include:
     (a) Enhancing the reputation and image of Washington state's potatoes and potato producers;
     (b) Working to eliminate or limit impediments affecting the sale and use of Washington state's potatoes in local, domestic, and foreign markets;
     (c) Protecting the public by educating the public in reference to the quality, care, and methods used in the production of Washington state's potatoes;
     (d) Increasing the public knowledge of nutritional value, health-giving qualities, and dietetic value of Washington state's potatoes and products; and
     (e) Supporting and engaging in programs or activities that benefit the planting, production, harvesting, handling, processing, transportation, trade, and use of potatoes produced in Washington state.

NEW SECTION.  Sec. 2   The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Affected area" or "area of production" are synonymous and mean the state of Washington.
     (2) "Affected handler" means any handler of potatoes who is subject to this chapter.
     (3) "Affected producer" means any producer who is subject to this chapter.
     (4) "Assessment" means the monetary amount established in this chapter that is to be paid by each affected producer to the commission in accordance with the schedule established in this chapter.
     (5) "Commercial quantities" means and includes five hundredweight or more.
     (6) "Commission" means the potato commission established in this chapter.
     (7) "Department" means the department of agriculture of the state of Washington.
     (8) "Director" means the director of agriculture of the state of Washington or any qualified person or persons designated by the director of agriculture to act for him or her concerning some matter under this chapter.
     (9) "District" means the geographical divisions of the area of potato production established under this chapter.
     (10) "Fiscal year" means the twelve-month period beginning July 1st of any year.
     (11) "Handler" means any person who acts, either as principal, agent, or otherwise, in the processing, packing, shipping, selling, or distributing of potatoes that are not produced by the handler. "Handler" does not include a common carrier used to transport an agricultural commodity. "To handle" means to act as a handler.
     (12) "Hosting" includes providing meals, refreshments, lodging, transportation, gifts of nominal value, reasonable and customary entertainment, and normal incidental expenses at meetings or gatherings.
     (13) "Hundredweight" or "affected unit" are synonymous and mean each one hundred pound unit or any combination of packages making a one hundred pound unit of potatoes.
     (14) "Mail" or "send," for purposes of any notice relating to rule making, referenda, or elections, means regular mail or electronic distribution, as provided in RCW 34.05.260 for rule making. For the purposes of this definition, "electronic distribution" or "electronically" means distribution by electronic mail or facsimile mail.
     (15) "Person" includes any individual, firm, corporation, limited liability company, trust, association, partnership, society, or any other organization of individuals or any unit or agency of local or state government.
     (16) "Potatoes" means and includes all kinds and varieties of Irish potatoes grown in the state of Washington and marketed, sold, or intended for use for human consumption.
     (17) "Producer" means any person who is engaged in the production for market of potatoes in commercial quantities and who has a proprietary interest in the potatoes grown in the state of Washington. For purposes of this chapter, "producer" includes a landowner, landlord, tenant, or other person who participates in the growing or producing of potatoes. "To produce" means to act as a producer.
     (18) "Referendum" means a vote by the affected parties or affected producers that is conducted by secret ballot.
     (19) "Sale" means a transaction wherein the property in or to potatoes is transferred from the producer to a purchaser for consideration. "Sale" includes an agreement to acquire such property for a consideration.
     (20) "Trade relations hosting" means the hosting of individuals and groups of individuals at meetings, meals, and gatherings for the purpose of cultivating trade relations for Washington state potatoes and potato products.
     (21) "Unfair trade practice" means any practice that is unlawful or prohibited under the laws of the state of Washington including but not limited to Titles 15, 16, and 69 RCW and chapters 9.16, 19.77, 19.80, 19.84, and 19.83 RCW, or any practice, whether concerning interstate or intrastate commerce that is unlawful under the federal trade commission act of 1914, as amended (38 Stat. 719; 15 U.S.C. Sec. 41 et seq.) or the violation of or failure accurately to label as to grades and standards in accordance with any lawfully established grades or standards or labels.
     (22) "Vacancy" means that a commission member leaves or is removed from a position on the commission before the end of a term, or a nomination process for the beginning of a term concludes with no candidates for a position.

NEW SECTION.  Sec. 3   (1) The potato commission is hereby established to administer this chapter. Commission members must be citizens and residents of Washington and at least eighteen years of age. The commission shall be composed of fifteen members, nine of whom shall be producers elected from districts as provided in subsections (2) and (3) of this section, five who are appointed by the elected producer members as provided in subsection (4) of this section, and one member appointed by the director from the department to represent the director as a voting member.
     (2) For the purpose of nomination and selection of producer members of the commission, the affected area of the state of Washington shall be divided into three representative districts as provided in this subsection.
     (a) District 1 is the counties of Douglas, Chelan, Okanogan, Grant, Adams, Lincoln, Ferry, Stevens, Pend Oreille, Spokane, and Whitman.
     (b) District 2 is the counties of Kittitas, Yakima, Klickitat, Benton, Franklin, Walla Walla, Columbia, Garfield, and Asotin.
     (c) District 3 is the counties of Skagit, Whatcom, and all other counties not named in (a) or (b) of this subsection.
     (3) Producer members shall be elected from the districts as follows:
     (a) Positions 1, 2, 3, and 4 shall be elected from district 1;
     (b) Positions 5, 6, 7, and 8 shall be elected from district 2; and
     (c) Position 9 shall be elected from district 3.
     (4)(a) Positions 10, 11, 12, 13, and 14 shall be appointed by the elected producers as provided in subsections (1) and (5)(b) of this section.
     (b) Position 15 shall be appointed by the director as provided in subsection (1) of this section.
     (5)(a) Producer members of the commission shall be producers of potatoes in the district in and for which they are nominated and elected. The producer members shall be and have been actively engaged in producing the potatoes in this state for a period of at least three years, and shall derive a substantial proportion of their incomes from the sale of potatoes. A producer member of a commission must have paid an assessment on potatoes adopted by the commission or its predecessor commission in each of the preceding three calendar years. The qualifications of producer members of the commission must continue during their term of office.
     (b) Members appointed to positions 10, 11, 12, 13, and 14 by the elected producers shall be either Washington potato producers, handlers, or others active in matters directly relating to Washington state potatoes and have a demonstrated record of service in the potato industry in Washington state. The appointed members of the commission shall be elected by a majority of the elected commissioners.
     (6) The term of office of the commission members is three years from the date of their election or appointment and until their successors are elected and qualified.
     (7) Nomination and election of commission members is as provided for in this subsection (7).
     (a) Not earlier than March 18th and not later than April 2nd of each year, the director shall give notice by mail to all producers in a district where a vacancy will occur, of such vacancy or such vacancies and call for nominations. Nominating petitions shall be signed by five persons qualified to vote for candidates. The notice shall state the final date for filing petitions, which shall be not earlier than April 7th and not later than April 12th of each year.
     (b) The director shall mail ballots to all affected producers in the district in which the vacancy will occur not earlier than April 17th and not later than May 2nd of each year. Ballots shall be postmarked not later than June 1st of that year. The mailed ballot shall be conducted in a manner so that it shall be a secret ballot in accordance with rules adopted by the director. An affected producer is entitled to one vote.
     (8) The members of the commission not elected by the producers shall be elected by a majority of the commission within ninety days before the expiration of the member's term.
     (9)(a) To fill a vacancy caused by the failure to qualify of a person elected by the producers as a member of the commission, or in the event of the death, removal, resignation, or disqualification of any elected member, the director shall call for nominations and give notice by mail to all producers in the district where the vacancy occurred. A valid nominating petition must be signed by at least five persons qualified to vote for the nominated candidate and must be returned to the director. The notice shall state the final date for filing a nomination petition. If more than one valid nomination is submitted, the director shall conduct an election and mail ballots to all producers in the district where the vacancy occurred.
     (b) To fill vacancies caused by reasons other than the expiration of an appointed term, the new commission members shall be elected by the commission at its first or second meeting after the occurrence of the vacancy.
     (c) In the event that a nomination process for the beginning of a term of an elected member concludes with no candidate, a new member shall be appointed by the commission. The appointment shall be made at the commission's first or second meeting after the expiration of the previous term.

NEW SECTION.  Sec. 4   The commission may:
     (1) Administer, enforce, and implement this chapter;
     (2) Elect a chair and such other officers as the commission may deem advisable and select subcommittees of commission members;
     (3) Employ and discharge at its discretion an executive director, additional personnel, attorneys, consultants, research agencies, and other persons and firms that it may deem appropriate, and compensate its employees;
     (4) Acquire personal property and lease office space and other necessary real property and transfer and convey the same;
     (5) Institute and maintain in its own name any and all legal actions, including actions by injunction, mandatory injunction, or civil recovery, or proceedings before administrative tribunals or other governmental authorities necessary to implement this chapter;
     (6) Keep accurate records of all its receipts and disbursements, which records shall be open to inspection, and make annual reports therefrom to the state auditor;
     (7) Borrow money and incur indebtedness;
     (8) Make necessary disbursements for routine operating expenses;
     (9) Collect the assessments of producers as provided in this chapter and expend the same in accordance with and to effectuate the purposes of this chapter;
     (10) To prepare a budget or budgets covering anticipated income and expenses to be incurred in carrying out the provisions of this chapter during each fiscal year;
     (11) Accept and receive gifts and grants from private persons or private and public agencies and expend the same to effectuate the purposes of this chapter;
     (12) Work cooperatively with other local, state, and federal agencies; universities; and national organizations for the purposes of this chapter;
     (13) Enter into contracts or interagency agreements with any private or public agency, whether federal, state, or local, to carry out the purposes of this chapter; however, personal service contracts must comply with chapter 39.29 RCW;
     (14) Enter into contracts or agreements for research and education in the production, irrigation, processing, transportation, use, distribution, and trade barriers impacting potatoes and potato products;
     (15) Retain in emergent situations the services of private legal counsel to conduct legal actions on behalf of the commission;
     (16) Participate in international, federal, state, and local hearings, meetings, and other proceedings relating to the production, irrigation, manufacture, regulation, transportation, trade, distribution, sale, or use of potatoes as requested by any elected official or officer or employee of any agency and as authorized under RCW 42.17.190, including the reporting of those activities to the public disclosure commission;
     (17) Assist and cooperate with the department or any other local, state, or federal government agency in the investigation and control of exotic pests and diseases that could damage or affect trade and export of potatoes;
     (18) Acquire or own intellectual property rights, licenses, or patents and collect royalties resulting from commission-funded research related to potatoes;
     (19) Engage in appropriate fund-raising activities for the purpose of supporting activities of the commission authorized by this chapter;
     (20) Establish a foundation using commission funds as grant money for the purposes established in this chapter;
     (21) Maintain a list of the names and addresses of affected producers that may be compiled from information used to collect assessments under this chapter and data on the value of each producer's production under this chapter. This list may be compiled from information used to collect producer assessments for a three-year period;
     (22) Maintain a list of the names and addresses of persons who handle potatoes within the affected area and data on the amount and value of the potatoes handled by each person under this chapter for a minimum three-year period;
     (23) Check records of producers or handlers of potatoes during normal business hours to determine whether the appropriate assessment has been paid; and
     (24) Exercise such other powers and perform such other duties as are necessary and proper to effectuate the purposes of this chapter.

NEW SECTION.  Sec. 5   (1) The commission shall by resolution establish a headquarters, which shall continue as the headquarters until changed by the commission, where the books, records, and minutes of the commission meetings shall be kept.
     (2) Any action taken by the commission requires the majority vote of the members present, and a quorum must be present.
     (3) A quorum of the commission consists of at least nine members.
     (4)(a) Members of the commission shall be compensated in accordance with RCW 43.03.230. Members and employees of the commission shall receive travel expenses in accordance with RCW 43.03.050 and 43.03.060 for each day spent in actual attendance at or traveling to and from meetings of the commission or on special assignments for the commission.
     (b) Members and employees may be reimbursed for actual travel expenses incurred in carrying out this chapter as provided by rules adopted by the commission. In developing these rules, the commission shall review the special allowances for foreign travel and other travel involving higher than usual costs for subsistence and lodging adopted by the office of financial management as provided in RCW 43.03.050(1).
     (5) In addition to notice of meetings of the commission as required by the open public meetings act, chapter 42.30 RCW, notice of the meetings shall also be published in the commission newsletter and sent to appropriate general and agricultural media outlets.

NEW SECTION.  Sec. 6   Obligations incurred by the commission and any other liabilities or claims against the commission may be enforced only against the assets of the commission in the same manner as if it were a corporation. No liability for the debts or actions of the commission exist against either the state of Washington or any subdivision or instrumentality thereof or the assets thereof or against any member officer, employee, or agent of the commission in his or her individual capacity. The members of the commission, including employees thereof, may not be held responsible individually in any way whatsoever to any person for errors in judgment, mistakes, or other acts, either of commission or omission, as principal agent, person, or employee, except for their own individual acts of dishonesty or crime. No such person or employee may be held responsible individually for any act or omission of any other member of the commission. Liability of the members of the commission is several and not joint and no member is liable for the default of any other member.

NEW SECTION.  Sec. 7   The purpose of this chapter is to promote the general welfare of the state and maintain and protect existing markets, increase production efficiency, ensure a fair regulatory environment, and increase use and consumption of potatoes produced in Washington. The commission shall conduct the programs in this section in accordance with this chapter.
     (1) The commission may investigate and take necessary action to prevent or eliminate unfair trade and regulatory barriers and practices and correct, where possible, trade and regulatory barriers and practices that hinder the sale, production, transport, and export of Washington-produced potatoes or potato products. If the commission finds as a result of the investigation that trade, regulatory, or transportation barriers are restricting the free flow of potatoes produced in this state, the commission may institute appropriate action before any agency or body deemed necessary to correct the situation. Information acquired in an investigation is confidential and may be released only to the extent necessary to effectuate the purposes of this chapter, including but not limited to information regarding:
     (a) The prevention, modification, or elimination of trade and regulatory barriers that restrict or inhibit the production, transport, consumption, export, or sale of potatoes produced in this state;
     (b) Presentation of technical information or facts to and negotiations with state, federal, or foreign governmental agencies on matters that affect the production, irrigation, transport, use, consumption, export, or sale of potatoes grown in this state, including cooperation with any agency or group in efforts to increase consumption or use of potatoes, and such other activities and programs that are consistent with the objectives of this chapter; and
     (c) Investigating transportation rates and service costs.
     (2)(a) The commission, subject to the provisions of this chapter, may carry on or cause to be carried on any necessary and proper production, irrigation, processing, transportation, export, handling, or use of research or survey studies relating to potatoes and may expend moneys for those purposes.
     (b) The commission may engage in research and survey studies including, but not limited to:
     (i) Production problems, such as those associated with soil, seed, and crop protection tools;
     (ii) Developing and testing new potato cultivars with improved disease-resistance, processing, nutritional, or horticultural characteristics;
     (iii) Improving techniques and methods of harvesting potatoes;
     (iv) Developing and improving methods of processing potatoes and potato by-products for the purpose of increasing and expanding their use for food and industrial purposes;
     (v) Improving packing and handling techniques that promote more efficient operation in the transport, trade, and distribution of potatoes;
     (vi) Determining any special nutritive, nutraceutical, or pharmaceutical qualities of potatoes produced in Washington; and
     (vii) Conducting surveys and other research regarding production practices, resource requirements and availability, and any other issues or matters that may impact the continued production of potatoes in Washington.
     (c) The commission may, in addition to the activities in (b) of this subsection, engage in any other proper and necessary research and survey programs and activities consistent with and subject to the limitations of this chapter. The research and survey studies may include the collection of data and information relating to potatoes; the analysis of the data and information; the dissemination of the data, information, and analysis; and other investigation that falls within the scope of the production, irrigation, use, processing, transportation, or handling of potatoes.
     (d) The commission, subject to this chapter, may coordinate the state's potato crop protection chemical registrations and integrated pest management implementation.
     (3)(a) The commission may adopt rules, in accordance with chapter 34.05 RCW, to define, establish, and provide labeling requirements for improving standards and grades for potatoes and may expend moneys for such purposes.
     (b) The commission shall give reasonable written notice to all producers, handlers, and persons directly affected by the labeling requirements issued under this section, in accordance with rule-making proceedings conducted under chapter 34.05 RCW.
     (c) The commission may cooperate with state and federal agencies or departments responsible for revising and modernizing grades and standards and labeling of potatoes.
     (d) This section does not authorize the commission to set minimum grades, sizes, or maturity of potatoes that a producer may sell, offer for sale, or ship.
     (4) The commission may conduct programs for the purpose of providing factual and accurate information and education to the public including:
     (a) The economic, environmental, and nutritional value and benefits of potatoes and the Washington potato industry;
     (b) The quality, care, and methods used in the production of Washington potatoes;
     (c) The handling, preparation, and use of Washington potatoes and potato products; and
     (d) The effects of trade, transportation, and regulatory barriers on the Washington potato industry.
     (5) The commission may conduct programs for the purpose of providing information and education to the Washington potato industry including:
     (a) Public opinion or awareness research information for producers of potatoes;
     (b) Industry-related education and training; and
     (c) Information and services enabling producers to meet resource conservation objectives and keep current with issues impacting their business.
     (6) The commission may, subject to this chapter, provide information and communicate on matters pertaining to the production, irrigation, processing, transportation, trade, or uses of potatoes produced in Washington state, as requested by any elected official or officer or employee of any agency.

NEW SECTION.  Sec. 8   (1) An assessment shall be levied and collected by the commission of four cents per hundredweight upon all potatoes sold, processed, delivered for sale or processing by a producer, or stored or delivered for storage when storage or delivery for storage is outside the state. The assessment may be decreased or increased at any time subject to a referendum approved by affected potato producers in accordance with this chapter. The assessment shall be paid by the producer. No assessment may be collected on:
     (a) Potatoes grown and sold for seed under an established seed certification program;
     (b) Potatoes sold for livestock feed, regardless of grade;
     (c) Potatoes sold for nonfood products, such as industrial starch;
     (d) Potatoes of a producer's own production used by the producer on the producer's own premises for seed, feed, or personal consumption;
     (e) Potatoes donated or shipped for relief or charitable purposes; or
     (f) Potatoes sold by a producer whose production is less than five hundred pounds per year.
     (2)(a) All assessments made and levied under this chapter apply to the respective producer who is primarily liable therefor.
     (i) Handlers receiving potatoes from the producer, including, but not limited to, warehousemen, shippers, and processors that collect assessments from producers whose production they handle, shall pay assessments collected to the commission on or before the twentieth day of the succeeding month for the previous month's collections. On a monthly basis, each handler shall file with the commission a return under oath on forms to be furnished by the commission, stating the quantity of potatoes handled, processed, delivered, or shipped during the period prescribed by the commission.
     (ii) Any person, producer, or handler subject to the payment of assessments shall give adequate assurance or security concerning the payments to the commission.
     (b) On or before the beginning of each fiscal year, the commission shall give reasonable notice to all producers, handlers, and other affected persons of the method or methods of collection to be used for that fiscal year on field run or ungraded potatoes.
     (c) No affected units of potatoes may be transported, carried, shipped, sold, stored, or otherwise handled or disposed of until every due and payable assessment under this chapter has been paid and the receipt issued or stamp canceled. No liability under this chapter attaches to common carriers in the regular course of their business. When any potatoes for which an exemption as provided in subsection (1) of this section is claimed are shipped either by railroad or truck, the reasons for the exemption shall be plainly noted on the bill of lading, shipping document, container, or invoice.
     (d) Any producer or handler who fails to comply with this subsection is guilty of violating this chapter and is subject to the penalty, collection, and liability provisions of this chapter.
     (3)(a) Moneys collected by the commission under this chapter as assessments shall be used by the commission only for the purposes of paying for the costs or expenses arising in connection with carrying out the purposes and provisions of this chapter.
     (b) At the end of each fiscal year the commission shall credit each producer with any amount paid by the producer in excess of three percent of the total market value of all potatoes sold, processed, or delivered for sale or processing during that period. Refunds may be made only upon satisfactory proof given by the producer, which may include bills of lading, bills of sale, or receipts.

NEW SECTION.  Sec. 9   Assessments shall be levied upon potatoes sold on a field run or ungraded basis as provided in this section.
     (1) If payment to the grower for the potatoes is based upon the gross weight of potatoes sold and not upon the yield of any particular grade of potatoes as determined by any type of sorting or inspection, then the assessment is made on ninety percent of the gross hundredweight of potatoes so sold.
     (2) If payment to the grower for the potatoes is based upon the net weight of potatoes intended for human consumption derived from the potatoes so sold as determined by any type of sorting or inspection, then the assessment is made on the total net weight of potatoes intended for human consumption.

NEW SECTION.  Sec. 10   This section establishes the procedure for reporting and paying assessments levied under this chapter. Assessments shall be paid in accordance with one or more of the following methods as prescribed by the commission, in its discretion, for each affected producer or handler:
     (1) By means of collection from producers by handlers, including warehousemen, packers, and processors receiving potatoes from producers, at the time the potatoes are first handled, and payment of assessments by those handlers to the commission:
     (a) The commission shall bill each handler at such intervals, at least monthly, as the commission may from time to time determine, for the assessments due upon potatoes handled in the preceding period for which billing has not previously been made, and upon which assessments have not been paid, computed on the basis of the quantity of potatoes so handled as recorded on potato shipping pertaining to each handler prepared by the department on behalf of the commission, and filed with the commission, or with respect to handlers who are packers or processors, on the basis of the quantity of potatoes so handled as recorded on potato shipping records pertaining to such packer or processor prepared by such processor and filed with the commission;
     (b) As used in (a) of this subsection, "handler" is the person, firm, or corporation designated as shipper on the potato shipping record form;
     (c) In the event potatoes subject to assessment are handled by processors or other handlers under circumstances in which no potato shipping record is filed with the commission, with respect to the potatoes so handled the handler shall, at the time of submitting the report required by (d) of this subsection, pay in full the assessment on the potatoes so reported;
     (d) Each handler shall file a monthly report, under oath, on forms provided by the commission, showing the name and address of the handler making the report, the quantity of potatoes handled during the preceding calendar month, the name, address, handler's lot number, and quantity of potatoes handled, for each respective producer, and the representative district in which the potatoes were grown. The report shall be filed with the commission not later than the twentieth day of the month following that in which the potatoes were handled; or
     (2) By means of payment in cash by the producer or handler, as determined by the commission in each respective instance, before the time the potatoes are shipped in either interstate or intrastate commerce.

NEW SECTION.  Sec. 11   Any due and payable assessment levied under this chapter, and every sum due in a specified amount under this chapter constitutes a personal debt of every person so assessed or who otherwise owes the same, and the amount is due and payable to the commission when payment is called for by the commission. In the event that any assessment is not paid within ninety days after the date of the billing by the commission, or within ninety days after the due date of the report required by this chapter, a sum equal to ten percent of the unpaid assessment or unpaid portion thereof shall be added to the original amount and is due and owing to the commission. In the event of failure of a person or persons to pay any such due and payable assessment or other sum, the commission may bring a civil action against the person or persons in a state court of competent jurisdiction for the collection thereof, together with the additional ten percent as provided in this section, and the action shall be tried and judgment rendered as in any other cause of action for debt due and payable.

NEW SECTION.  Sec. 12   (1)(a) Any handler handling potatoes for fresh market who has not established a record of prompt payment of assessments due on fresh market potatoes in accordance with this chapter must prepay the assessments due the commission.
     (b) The amount of prepayment shall be determined on the estimated basis of the potatoes the handler will handle during the first thirty days of the potato shipping season, or if the handler has shipped in the immediately prior potato shipping season, the prepayment shall be based on the highest thirty-day assessment due the commission during that shipping season. Prepayment shall not exceed twenty-five percent of the total estimated annual assessment payable by the handler.
     (2) Any handler who has established a record of prompt payment during the entire previous potato shipping season and continues to maintain a record of prompt payment is not subject to the prepayment requirements in subsection (1) of this section.

NEW SECTION.  Sec. 13   The commission shall notify the department in writing of any handler who has not established a record of prompt payment as set forth in this chapter, and that handler is subject to this section. No affected units of potatoes shall be transported, carried, shipped, sold, stored or otherwise handled or disposed of until every due and payable assessment herein provided for has been paid and the receipt issued, but no liability hereunder shall attach to common carriers in the regular course of their business. When any potatoes for which exemption as provided in this chapter is claimed are shipped either by railroad or truck, there shall be plainly noted on the bill of lading, shipping document, container or invoice, the reasons for such exemptions.

NEW SECTION.  Sec. 14   (1) Commission expenditures for agricultural development or trade promotion and promotional hosting shall be pursuant to specific budget items as approved by the commission at annual public hearings on the commission budget.
     (2) Individual commissioners and commission staff shall make agricultural development or trade promotion and promotional hosting expenditures, or seek reimbursements for those expenditures, only in those instances where the expenditures have been approved by the commission.
     (3) All payments and reimbursements shall be as identified and supported by vouchers to which receipts are attached. Voucher forms will be supplied by the commission, and require the following information:
     (a) Name and position of each person hosted, however in the case of a group of twenty-five or more persons, then only the name of the group hosting shall be required;
     (b) General purpose of the hosting;
     (c) Date of hosting;
     (d) To whom payment was or will be made; and
     (e) Signature of person seeking payment or reimbursement;
     (4) The chair of the commission, the executive director of the commission, or assistant executive director of the commission may approve direct payment or reimbursements submitted in accordance with this section.
     (5) The following persons may be hosted when it is reasonably believed such hosting will promote trade for the Washington state potato industry, as long as the hosting does not violate federal or state conflict of interest laws:
     (a) Individuals from private business and accompanying interpreter or interpreters;
     (b) Foreign government officials and accompanying interpreter or interpreters;
     (c) Federal, state, and local officials, however lodging, meals, and transportation may not be provided when those officials may obtain reimbursement for these expenses from their government employer;
     (d) The general public, at meetings and gatherings open to the general public;
     (e) Commissioners and employees of the commission when their attendance at meetings, meals, and gatherings at which the persons described in (a) through (d) of this subsection are being hosted will promote trade for the Washington state potato industry.

NEW SECTION.  Sec. 15   (1) It is a misdemeanor for:
     (a) Any person willfully to violate any provision of this chapter;
     (b) Any person willfully to render or furnish a false or fraudulent report, statement of record required by the commission under this chapter, or any rule of the commission or rule of the department adopted under this chapter, or willfully to fail or refuse to furnish or render any such report, statement, or record so required.
     (2) In the event of violation or threatened violation of any provision of this chapter or any rule of the commission or rule of the department adopted under this chapter, the commission is entitled to an injunction to prevent further violation and to a decree of specific performance of such rules, and to a temporary restraining order and injunction pending litigation upon filing a verified complaint and sufficient bond.
     (3) All persons subject to this chapter shall severally from time to time, upon the request of the commission, furnish the commission with such information necessary to effectuate the policies of this chapter or to ascertain and determine the extent to which this chapter has been carried out or has effectuated such policies and purposes, or to determine whether or not there has been any abuse of the privilege of exemptions from laws relating to trusts, monopolies, and restraints of trade. Such information shall be furnished in accordance with forms and reports to be prescribed by the commission. For the purpose of ascertaining the correctness of any report made to the commission under this section or for the purpose of obtaining the information required in any such report where it has been requested and has not been furnished, the commission is authorized to examine such books, papers, records, copies of tax reports, accounts, correspondence, contracts, documents, or memoranda as the commission deems relevant and that are within the control of any such person from whom such report was requested, or of any person having, either directly or indirectly, actual or legal control of or over such person or such records, or of any subsidiary of any such person. To carry out the purposes of this section, the commission, upon giving due notice, may hold hearings, take testimony, administer oaths, subpoena witnesses, and issue subpoenas for the production of books, records, documents, or other writings of any kind, and shall apply with respect to any such hearing, together with such other rules consistent therewith as the commission may from time to time prescribe.

NEW SECTION.  Sec. 16   Moneys collected by the commission under this chapter from any assessment or as an advance deposit thereon shall be used by the commission only for the purpose of paying for the costs or expenses arising in connection with carrying out the purposes and provisions of this chapter.
     If the commission is ever terminated any and all moneys remaining with the commission operating under this chapter and not required to defray expenses or repay obligations incurred by that commission shall be returned to the affected producers in proportion to the assessments paid by each in the two-year period preceding the date of the termination.

NEW SECTION.  Sec. 17   If after complying with the procedures outlined in this chapter and a referendum proposal to terminate the commission is assented to, the commission shall:
     (1) Document the details of all measures undertaken to terminate the commission and identify and document all closing costs;
     (2) Contact the office of the state auditor and arrange for a final audit of the commission. Payment for the audit shall be from commission funds and identified in the budget for closing costs;
     (3) Provide for the reimbursement to affected producers of moneys collected by assessment. Reimbursement shall be made to those considered affected producers over the previous three-year time frame on a pro rata basis and at a percent commensurate with their volume of production over the previous three-year period. If the commission finds that the amounts of moneys are so small as to make impractical the computation and remitting of the pro rata refund, the moneys shall be paid into the state treasury as unclaimed trust moneys; and
     (4) Transfer all remaining files to the department for storage and archiving, as appropriate.

NEW SECTION.  Sec. 18   Any due and payable assessment levied under this chapter, and every sum due under this chapter in a specified amount constitutes a personal debt of every person so assessed or who otherwise owes the same, and the same shall be due and payable to the commission when payment is called for by the commission. In the event any person fails to pay the full amount of the assessment or such other sum on or before the date due, the commission may add to the unpaid assessment or sum an amount not exceeding ten percent of the same to defray the cost of enforcing collection of it. In the event of failure of such person or persons to pay any such due and payable assessment or other such sum, the commission may bring a civil action against such person or persons in a state court of competent jurisdiction for the collection thereof, together with the above specified ten percent thereon, and such action shall be tried and judgment rendered as in any other cause of action for debt due and payable.

NEW SECTION.  Sec. 19   All moneys that are collected or otherwise received under this chapter shall be used solely by and for the commission and shall not be used for any other commission, nor the department except as otherwise provided in this chapter. Such moneys shall be deposited in a separate account or accounts in the name of the commission in any bank that is a state depositary. All expenses and disbursements incurred and made under the provisions of this chapter shall be paid from moneys collected and received under this chapter without the necessity of a specific legislative appropriation and all moneys shall be paid from the account by check or voucher in such form and in such manner and upon the signature of such person as may be prescribed by the commission. The provisions of RCW 43.01.050 do not apply to any such account or any moneys so received, collected, or expended.

NEW SECTION.  Sec. 20   (1) Any funds of the commission may be invested in savings or time deposits in a public depositary as defined in RCW 39.58.010.
     (2) This section applies to all funds that may be lawfully so invested, that in the judgment of the commission are not required for immediate expenditure. The authority granted by this section is not exclusive and shall be construed to be cumulative and in addition to other authority provided by law for the investment of such funds, including, but not limited to, authority granted under chapters 39.58, 39.59, and 43.84 RCW.

NEW SECTION.  Sec. 21   Every administrator, employee, or other person occupying a position of trust with the commission and every member actually handling or drawing upon funds shall give a bond in such penal amount as may be required by the commission, the premium for which bond or bonds shall be paid by the commission.

NEW SECTION.  Sec. 22   (1) Pursuant to RCW 42.17.31907, certain agricultural business records, commodity commission records, and department of agriculture records relating to commodity commissions and producers of agricultural commodities are exempt from public disclosure.
     (2) Financial and commercial information and records submitted to either the department or the commission for the purpose of administering this chapter may be shared between the department and the commission. They may also be used, if required, in any suit or administrative hearing involving any provision of this chapter.
     (3) This chapter does not prohibit:
     (a) The issuance of general statements based upon the reports of a number of persons subject to this chapter as long as the statements do not identify the information furnished by any person; or
     (b) The publication by the commission of the name of any person violating this chapter and a statement of the manner of the violation by that person.

NEW SECTION.  Sec. 23   (1) The commission shall prepare a list of all affected producers from any information available from the department, producers, producer associations, organizations, or handlers of potatoes. This list shall contain the names and addresses of all affected persons who produce the potatoes and the amount, by unit, of the potatoes produced during at least the past three years.
     (2) The commission shall prepare a list of all persons who handle potatoes and the amount of potatoes handled by each person during at least the past three years.
     (3) It is the responsibility of all affected parties to ensure that their correct address is filed with the commission. It is also the responsibility of affected parties to submit production data and handling data to the commission as prescribed by the commission's rules or policies.
     (4) Any qualified person may, at any time, have his or her name placed upon any list for which he or she qualifies by delivering or mailing the information to the commission. The lists shall be corrected and brought up-to-date in accordance with evidence and information provided to the commission.
     (5) The commission shall maintain a certified list of affected producers or affected handlers from its records. The list shall contain all information required to conduct a referendum or commission member elections under this chapter.
     (6) For all purposes of giving notice and holding referenda on amendment or termination proposals, and for giving notice and electing or selecting members of the commission, the applicable list corrected up to the day preceding the date the list is certified by the commission is deemed to be the list of all affected producers or affected handlers, as applicable, entitled to notice or to vote. Inadvertent failure to notify an affected producer or handler does not invalidate a proceeding conducted under this chapter.

NEW SECTION.  Sec. 24   Any member of a commission may also be a member or officer of an association that has the same objectives for which the commission was formed. The commission may also contract with such association for services necessary to carry out any purposes authorized under this chapter, if an appropriate contract has been entered into.

NEW SECTION.  Sec. 25   Nothing in this chapter permits the fixing of prices not otherwise permitted by law or any limitation on production and no agreement or any rule thereunder may contain any such provisions.

NEW SECTION.  Sec. 26   (1) Upon completion of any vote, referendum, or nomination and elections, the director shall tally the results of the vote and provide the results to affected parties.
     (2) If an affected party disputes the results of a vote, that affected party, within sixty days from the announced results, shall provide in writing a statement of why the vote is disputed and request a recount.
     (3) Once the vote is tallied and distributed, all disputes are resolved, and all matters in a vote are finalized, the individual ballots may be destroyed.

NEW SECTION.  Sec. 27   The members of the commission may, subject to approval by two-thirds of the voting members of the commission, suspend for a period not exceeding one crop-year at a time all or part of the assessments on potatoes subject to this chapter.

NEW SECTION.  Sec. 28   The director may adopt rules necessary to carry out the duties and responsibilities under this chapter including, but not limited to:
     (1) The issuance, amendment, suspension, or termination of rules associated with this chapter;
     (2) Procedural, technical, or administrative rules that may address and include, but are not limited to:
     (a) Nominations conducted under this chapter; and
     (b) Elections of commission members or referenda conducted under this chapter.

NEW SECTION.  Sec. 29   (1) The substance of a petition received under this chapter to amend or terminate commission programs or assessments shall be set out in detail and designated as the proposal. A copy of the proposal shall be mailed by the department to all affected parties or producers based on the list provided for under this chapter, as applicable, and shall be posted on the department's web site.
     (2) Notice of a public hearing to amend or terminate the commission shall be published in the form of a legal notice for a period of two days in a newspaper of general circulation within the affected areas, as the director may prescribe. The notice must also be posted on the department's web site. The department shall mail a copy of the public hearing notice along with a copy of the proposal as provided in subsection (1) of this section to all affected parties or affected producers, as applicable, who may be directly affected by the proposal and whose names and addresses appear on the list compiled under this chapter. The mailing must include the department's web site address along with a description of the process for the amendment or termination of the commission, as applicable.
     (3) At a public hearing, the director shall receive testimony offered in support of, or opposition to, the proposed amendment to or termination of the commission and concerning the terms, conditions, scope, and area thereof. The hearing shall be public and all testimony shall be received under oath. A full and complete record of all proceedings at such hearings shall be made and maintained on file in the office of the director, which file shall be open to public inspection. The director shall base any findings upon the testimony received at the hearing, together with any other relevant facts available from official publications of institutions of recognized standing. The director shall describe in the findings such official publications upon which any finding is based.
     (4) The director has the power to subpoena witnesses and to issue subpoenas for the production of any books, records, or documents of any kind.
     (5) The superior court of the county in which any hearing or proceeding may be had may compel the attendance of witnesses and the production of records, papers, books, accounts, documents, and testimony as required by such subpoena. The director, in case of the refusal of any witness to attest or testify or produce any papers required by the subpoena, shall report to the superior court of the county in which the proceeding is pending by petition setting forth that due notice has been given of the time and place of attendance of the witness or the production of the papers and that the witness has been summoned in the manner prescribed in this chapter and that he or she has failed to attend or produce the papers required by the subpoena at the hearing, cause, or proceeding specified in the subpoena, or has refused to answer questions propounded to it in the course of such hearing, cause, or proceeding, and shall ask an order of the court to compel a witness to appear and testify before the director. The court, upon such petition, shall enter an order directing the witness to appear before the court at a time and place to be fixed in such order and then and there to show cause why he or she has not responded to the subpoena. A copy of the order shall be served upon the witness. If it appears to the court that the subpoena was regularly issued, it shall enter an order that the witness appear at the time and place fixed in the order and testify or produce the required papers, and on failing to obey the order, the witness shall be dealt with as for contempt of court.

NEW SECTION.  Sec. 30   (1) The director shall make findings upon material points controverted at the hearing and required by this chapter and upon such other matters and things as the director may deem fitting and proper. Based upon those findings, the director shall make conclusions and develop and issue a recommended decision. The findings, conclusions, and recommended decision, and the full text of the proposal shall be posted on the department's web site.
     (2) The recommended decision may deny or approve the proposal in its entirety, or it may recommend a rule containing other or different terms or conditions from those contained in the proposal, however any such rule shall be of a kind or type substantially within the purview of the notice of hearing and shall be supported by evidence taken at the hearing or by documents of which the director is authorized to take official notice. The director shall not approve the amendment or termination unless he or she finds with respect thereto:
     (a) That the proposed issuance, amendment, or termination thereof is reasonably calculated to attain the objective sought in a rule;
     (b) That the proposed issuance, amendment, or termination is in conformity with this chapter and, within the applicable limitations and restrictions in this chapter, will tend to effectuate its declared purposes and policies; and
     (c) That the interests of consumers of potatoes are protected in that the powers of this chapter are being exercised only to the extent necessary to attain such objectives.
     (3) If the director's recommended decision does not make any changes to the proposal, notification will be made by mail in the form of a postcard reciting the recommended decision. The postcard must also include the department's web site address where any person can access the full text of the findings, conclusions, and recommended decision.
     (4) If the director's recommended decision makes changes to the proposal or does not support the proposal, notification will be made by mail in the form of a letter describing the changes made or explaining the reason for not supporting the proposal and a referendum. The letter must also include the department's web site address where any person can access the full text of the findings, conclusions, and recommended decision.
     (5) After the director issues his or her findings, conclusions, and recommended decision, all interested parties shall have a period of not less than fifteen days from the date of the mailing of the postcard or letter to file statements with the director in support of or in opposition to the recommended decision. The director shall consider the additional statements and shall issue his or her final decision. The final decision may be the same as the recommended decision or may be revised in light of the additional information received in response to the recommended decision. The director shall notify affected parties of his or her final decision by mail in the form of a postcard. Notification shall include the department's web site address where any person can access the full text of the findings, conclusions, and final decision and the full text of the final proposal. If the final decision denies the proposal in its entirety, no further action may be taken by the director.
     (6) Affected parties who do not have access to materials posted on the department's web site may request notification by fax or mail.

NEW SECTION.  Sec. 31   After the director issues his or her final decision approving the amendment or termination, the director shall determine by a referendum whether the affected parties or producers assent to the proposed action or not. The director shall conduct the referendum among the affected parties or producers based on the list as provided for in this chapter, as applicable. The affected parties or producers shall be deemed to have assented to the proposed issuance or termination order if fifty-one percent or more by number reply to the referendum within the time specified by the director, and if, of those replying (a) sixty-five percent or more by number and fifty-one percent or more by volume assent to the proposed order; or (b) sixty percent or more by number and sixty percent or more by volume of those replying assent to the proposed order. The determination by volume shall be made on the basis of volume as determined in the list of affected producers created under this chapter, subject to rules of the director for such determination. Results of the referendum shall be mailed to all affected parties in the form of a postcard. If the requisite assent is given, the director shall adopt the order.

NEW SECTION.  Sec. 32   (1) All rule-making proceedings conducted under this chapter shall be in accordance with chapter 34.05 RCW.
     (2) Rule-making proceedings conducted under this chapter are exempt from compliance with RCW 34.05.310, chapter 19.85 RCW, the regulatory fairness act, and RCW 43.135.055 when adoption of the rule is determined by a referendum vote of the affected parties.
     (3) The commission may adopt amendments to rules associated with this chapter without conducting a referendum if the amendments are adopted under the following criteria:
     (a) The proposed amendments relate only to internal administration of this chapter and are not subject to violation by a person;
     (b) The proposed amendments adopt or incorporate by reference without material change federal statutes or regulations, Washington state statutes, or rules of other Washington state agencies, if the material adopted or incorporated regulates the same activities as are authorized under this chapter;
     (c) The proposed amendments only correct typographical errors, make address or name changes, or clarify language of a rule in accordance with this chapter;
     (d) The content of the proposed amendments is explicitly and specifically dictated by statute.

Sec. 33   RCW 15.66.270 and 1961 c 11 s 15.66.270 are each amended to read as follows:
     Nothing in this chapter contained shall apply to:
     (1) Any order, rule, or regulation issued or issuable by the Washington utilities and transportation commission or the interstate commerce commission with respect to the operation of common carriers;
     (2) Any provision of the statutes of the state of Washington relating to the Washington apple ((advertising)) commission (chapter 15.24 RCW), to the soft tree fruits commission (chapter 15.28 RCW) ((or)), to the dairy products commission (chapter 15.44 RCW), or to the potato commission established in chapter 15.-- RCW (sections 1 through 32 and 35 of this act). No marketing agreement or order shall be issued with respect to apples, soft tree fruits ((or)), dairy products, or potatoes for human consumption, for the purposes specified in RCW 15.66.030(1) or 15.66.030(2).

NEW SECTION.  Sec. 34   (1) The potato commission established in chapter 16-516 WAC is hereby abolished and its powers, duties, and functions are hereby transferred to the potato commission created in this act.
     (2)(a) All reports, documents, surveys, books, records, files, papers, or written material in the possession of the potato commission established in chapter 16-516 WAC shall be transferred to the custody of the potato commission created by this act. All cabinets, furniture, office equipment, motor vehicles, and other tangible property employed by the potato commission established in chapter 16-516 WAC shall be made available to the potato commission created by this act. All funds, credits, or other assets held by the potato commission established in chapter 16-516 WAC shall be assigned to the potato commission created by this act.
     (b) Any appropriations made to the potato commission established in chapter 16-516 WAC shall, on the effective date of this section, be transferred and credited to the potato commission created by this act.
     (c) If any question arises as to the transfer of any personnel, funds, books, documents, records, papers, files, equipment, or other tangible property used or held in the exercise of the powers and the performance of the duties and functions transferred, the director of financial management shall make a determination as to the proper allocation and certify the same to the state agencies concerned.
     (3) All employees of the potato commission established in chapter 16-516 WAC are transferred to the jurisdiction of the potato commission created by this act. All members of the potato commission established in chapter 16-516 WAC shall continue as members of the potato commission established in chapter 16-516 WAC until their terms expire.
     (4) All rules and all pending business before the potato commission established in chapter 16-516 WAC shall be continued and acted upon by the potato commission created by this act. All existing contracts and obligations shall remain in full force and shall be performed by the potato commission created by this act.
     (5) The transfer of the powers, duties, functions, and personnel of the potato commission established in chapter 16-516 WAC shall not affect the validity of any act performed before the effective date of this section.
     (6) If apportionments of budgeted funds are required because of the transfers directed by this section, the director of financial management shall certify the apportionments to the agencies affected, the state auditor, and the state treasurer. Each of these shall make the appropriate transfer and adjustments in funds and appropriation accounts and equipment records in accordance with the certification.
     (7) Nothing contained in this section may be construed to alter any existing collective bargaining unit or the provisions of any existing collective bargaining agreement until the agreement has expired or until the bargaining unit has been modified by action of the personnel resources board as provided by law.

NEW SECTION.  Sec. 35   Potatoes that are certified as organically grown under chapter 15.86 RCW are exempt from assessments under this chapter if a separate commodity commission is formed to include organically grown potatoes.

NEW SECTION.  Sec. 36   Sections 1 through 32 and 35 of this act constitute a new chapter in Title 15 RCW.

NEW SECTION.  Sec. 37   This act takes effect July 1, 2006.

NEW SECTION.  Sec. 38   If any section, subsection, sentence, clause, or part of this chapter is for any reason held to be invalid or unconstitutional, the judicial decision does not affect the remainder of the chapter and its application to other persons or circumstances. The legislature declares that each section, subsection, sentence, clause, and part of this chapter was enacted with the intent that if any portion of this chapter is severed, the remainder of the chapter is capable of accomplishing its legislative purpose."