N.Y. Agriculture & Markets Law § 258-kk: Northeast interstate dairy compact

§ 258-kk. Northeast interstate dairy compact. The northeast

interstate dairy compact as set forth in this article is hereby adopted

and entered into with all jurisdictions joining therein. The compact is

as follows:

NORTHEAST INTERSTATE DAIRY COMPACT

ARTICLE I. STATEMENT OF PURPOSE, FINDINGS AND DECLARATION OF POLICY

§ 1. Statement of purpose, findings and declaration of policy.

ARTICLE II. DEFINITIONS AND RULES OF CONSTRUCTION

§ 2. Definitions.

§ 3. Rules of construction.

ARTICLE III. COMMISSION ESTABLISHED

§ 4. Commission established.

§ 5. Voting requirements.

§ 6. Administration and management.

§ 7. Rulemaking power.

ARTICLE IV. POWERS OF THE COMMISSION

§ 8. Powers to promote regulatory uniformity, simplicity, and inter-

state cooperation.

§ 9. Equitable farm prices.

§ 10. Optional provisions for pricing order.

ARTICLE V. RULEMAKING PROCEDURE

§ 11. Rulemaking procedure.

§ 12. Findings and referendum.

§ 13. Producer referendum.

§ 14. Termination of over-order price or marketing order.

ARTICLE VI. ENFORCEMENT

§ 15. Records, reports, access to premises.

§ 16. Subpoena, hearings and judicial review.

§ 17. Enforcement with respect to handlers.

ARTICLE VII. FINANCE

§ 18. Finance of start-up and regular costs.

§ 19. Audit and accounts.

ARTICLE VIII. ENTRY INTO FORCE; ADDITIONAL MEMBERS AND WITHDRAWAL

§ 20. Entry into force; additional members.

§ 21. Withdrawal from compact.

§ 22. Severability.

§ 23. Reservation of rights.

ARTICLE I. STATEMENT OF PURPOSE, FINDINGS AND DECLARATION OF POLICY

§ 1. Statement of purpose, findings and declaration of policy.

The purpose of this compact is to recognize by constitutional

prerequisite the interstate character of the northeast dairy industry

and to form an interstate commission for the northeast region. The

mission of the commission is to take such steps as are necessary to

assure the continued viability of dairy farming in the northeast, and to

assure consumers of an adequate, local supply of pure and wholesome

milk.

The participating states find and declare that the dairy industry is

the paramount agricultural activity of the northeast. Dairy farms, and

associated suppliers, marketers, processors and retailers, are an

integral component of the region's economy. Their ability to provide a

stable, local supply of pure, wholesome milk is a matter of great

importance to the health and welfare of the region.

The participating states further find that dairy farms are essential

to the region's rural communities and character. The farms preserve open

spaces, sculpt the landscape and provide the land base for a diversity

of recreational pursuits. In defining the rural character of our

communities and landscape, dairy farms also provide a major draw for our

tourist industries.

By entering into this compact, the participating states affirm that

their ability to regulate the price which northeast dairy farmers

receive for their product is essential to the public interest. Assurance

of a fair and equitable price for dairy farmers ensures their ability to

provide milk to the market and the vitality of the northeast dairy

industry, with all the associated benefits.

Recent, dramatic price fluctuations, with a pronounced downward trend,

threaten the viability and stability of the northeast dairy region.

Historically, individual state regulatory action has been an effective

emergency remedy available to farmers confronting a distressed market.

The federal order system, implemented by the Agricultural Marketing

Agreement Act of 1937, establishes only minimum prices for dairy

products, without preempting the power of states to regulate milk prices

above the minimum levels so established. Based on this authority, each

state in the region has individually attempted to implement at least one

regulatory program in response to the current dairy industry crisis.

In today's regional dairy marketplace, cooperative, rather than

individual state action may address more effectively the market

disarray. Under our constitutional system, properly authorized, states

acting cooperatively may exercise more power to regulate interstate

commerce than they may assert individually without such authority. For

this reason, the participating states invoke their authority to act in

common agreement, with the consent of congress, under the compact clause

of the constitution.

In establishing their constitutional regulatory authority over the

region's fluid milk market by this compact, the participating states

declare their purpose that this compact neither displace the federal

order system nor encourage the merging of federal orders. Specific

provisions of the compact itself set forth this basic principle.

Designed as a flexible mechanism able to adjust to changes in a

regulated marketplace, the compact also contains a contingency provision

should the federal order system be discontinued. In that event, the

interstate commission is authorized to regulate the marketplace in

replacement of the order system. This contingent authority does not

anticipate such a change, however, and should not be so construed. It is

only provided should developments in the market other than establishment

of this compact result in discontinuance of the order system.

ARTICLE II. DEFINITIONS AND RULES OF CONSTRUCTION

§ 2. Definitions.

For the purposes of this compact, and of any supplemental or

concurring legislation enacted pursuant thereto, except as may be

otherwise required by the context:

(a) "Commission" means the commission established by this compact.

(b) "Compact" means this interstate compact.

(c) "Region" means the territorial limits of the states which are or

become parties to this compact.

(d) "Participating state" means a state which has become a party to

this compact by the enactment of concurring legislation.

(e) "Regulated area" means any area within the region governed by and

defined in regulations establishing a compact over-order price or

commission marketing order.

(f) "Pool plant" means any milk plant located in a regulated area.

(g) "Partially regulated plant" means a milk plant not located in a

regulated area but having class I distribution within such area, or

receipts from producers located in such area. Commission regulations

may exempt plants having such distribution or receipts in amounts less

than the limits defined therein.

(h) "Compact over-order price" means a minimum price required to be

paid to producers for class I milk established by the commission in

regulations adopted pursuant to sections nine and ten of this compact,

which is above the price established in federal marketing orders or by

state farm price regulation in the regulated area. Such price may apply

throughout the region or in any part or parts thereof as defined in the

regulations of the commission.

(i) "Commission marketing order" means regulations adopted by the

commission pursuant to sections nine and ten of this compact in place of

a terminated federal marketing order or state dairy regulation. Such

order may apply throughout the region or in any part or parts thereof as

defined in the regulations of the commission. Such order may establish

minimum prices for any or all classes of milk.

(j) "Milk" means the lacteal secretion of cows and includes all skim,

butterfat, or other constituents obtained from separation or any other

process. The term is used in its broadest sense and may be further

defined by the commission for regulatory purposes.

(k) "Class I milk" means milk disposed of in fluid form or as a fluid

milk product, subject to further definition in accordance with the

principles expressed in subdivision (b) of section three of this

compact.

(l) "State dairy regulation" means any state regulation of dairy

prices, and associated assessments, whether by statute, marketing order

or otherwise.

§ 3. Rules of construction. (a) This compact shall not be construed

to displace existing federal milk marketing orders or state dairy

regulation in the region but to supplement them. In the event some or

all federal orders in the region are discontinued, the compact shall be

construed to provide the commission the option to replace them with one

or more commission marketing orders pursuant to this compact.

(b) This compact shall be construed liberally in order to achieve the

purposes and intent enunciated in section one of this compact. It is the

intent of this compact to establish a basic structure by which the

commission may achieve those purposes through the application,

adaptation and development of the regulatory techniques historically

associated with milk marketing and to afford the commission broad

flexibility to devise regulatory mechanisms to achieve the purposes of

this compact. In accordance with this intent, the technical terms which

are associated with market order regulation and which have acquired

commonly understood general meanings are not defined herein but the

commission may further define the terms used in this compact and develop

additional concepts and define additional terms as it may find

appropriate to achieve its purposes.

ARTICLE III. COMMISSION ESTABLISHED

§ 4. Commission established.

There is hereby created a commission to administer the compact,

composed of delegations from each state in the region. A delegation

shall include not less than three nor more than five persons. Each

delegation shall include at least one dairy farmer who is engaged in the

production of milk at the time of appointment or reappointment, and one

consumer representative. Delegation members shall be residents and

voters of, and subject to such confirmation process as is provided for

in, the appointing state. Delegation members shall serve no more than

three consecutive terms with no single term of more than four years, and

be subject to removal for cause. In all other respects, delegation

members shall serve in accordance with the laws of the state

represented. The compensation, if any, of the members of a state

delegation shall be determined and paid by each state, but their

expenses shall be paid by the commission. Each state delegation shall be

entitled to one vote in the conduct of the commission's affairs.

§ 5. Voting requirements.

All actions taken by the commission, except for the establishment or

termination of an over-order price or commission marketing order, and

the adoption, amendment or rescission of the commission's by-laws, shall

be by majority vote of the delegations present. Establishment or

termination of an over-order price or commission marketing order shall

require at least a two-thirds vote of the delegations present. The

establishment of a regulated area which covers all or part of a

participating state shall require also the affirmative vote of that

state's delegation. A majority of the delegations from the participating

states shall constitute a quorum for the conduct of the commission's

business.

§ 6. Administration and management.

(a) The commission shall elect annually from among the members of the

participating state delegations a chairperson, a vice-chairperson, and a

treasurer. The commission shall appoint an executive director and fix

his or her duties and compensation. The executive director shall serve

at the pleasure of the commission, and, together with the treasurer,

shall be bonded in an amount determined by the commission. The

commission may establish through its by-laws an executive committee

composed of one member elected by each delegation.

(b) The commission shall adopt by-laws for the conduct of its business

by a two-thirds vote, and shall have the power by the same vote to amend

and rescind these by-laws. The commission shall publish its by-laws in

convenient form with the appropriate agency or officer in each of the

participating states. The by-laws shall provide for appropriate notice

to the delegations of all commission meetings and hearings and of the

business to be transacted at such meetings or hearings. Notice also

shall be given to other agencies or officers of participating states as

provided by the laws of those states.

(c) The commission shall file an annual report with the secretary of

agriculture of the United States, and with each of the participating

states by submitting copies to the governor, both houses of the

legislature, and the head of the state department having

responsibilities for agriculture.

(d) In addition to the powers and duties elsewhere prescribed in this

compact, the commission shall have the power:

(1) to sue and be sued in any state or federal court;

(2) to have a seal and alter the same at pleasure;

(3) to acquire, hold, and dispose of real and personal property by

gift, purchase, lease, license, or other similar manner, for its

corporate purposes;

(4) to borrow money and to issue notes, to provide for the rights of

the holders thereof and to pledge the revenue of the commission as

security therefor, subject to the provisions of section eighteen of this

compact;

(5) to appoint such officers, agents, and employees as it may deem

necessary, prescribe their powers, duties, and qualifications; and

(6) to create and abolish such offices, employments, and positions as

it deems necessary for the purposes of the compact and provide for the

removal, term, tenure, compensation, fringe benefits, pension, and

retirement rights of its officers and employees. The commission may also

retain personal services on a contract basis.

§ 7. Rulemaking power.

In addition to the power to promulgate a compact over-order price or

commission marketing orders as provided by this compact, the commission

is further empowered to make and enforce such additional rules and

regulations as it deems necessary to implement any provisions of this

compact, or to effectuate in any other respect the purposes of this

compact.

ARTICLE IV. POWERS OF THE COMMISSION

§ 8. Powers to promote regulatory uniformity, simplicity, and

interstate cooperation.

The commission is hereby empowered to:

(a) Investigate or provide for investigations or research projects

designed to review the existing laws and regulations of the

participating states, to consider their administration and costs, to

measure their impact on the production and marketing of milk and their

effects on the shipment of milk and milk products within the region.

(b) Prepare and transmit to the participating states model dairy laws

and regulations dealing with the inspection of farms and plants,

sanitary codes, labels for dairy products and their imitations,

standards for dairy products, license standards, producer security

programs, and fair trade laws.

(c) Study and recommend to the participating states joint or

cooperative programs for the administration of the dairy laws and

regulations and to prepare estimates of cost savings and benefits of

such programs.

(d) Encourage the harmonious relationships between the various

elements in the industry for the solution of their material problems.

Conduct symposiums or conferences designed to improve industry

relations, or a better understanding of problems.

(e) Prepare and release periodic reports on activities and results of

the commission's efforts to the participating states.

(f) Review the existing marketing system for milk and milk products

and recommend changes in the existing structure for assembly and

distribution of milk which may assist, improve, or promote more

efficient assembly and distribution of milk.

(g) Investigate costs and charges for producing, hauling, handling,

processing, distributing, selling and for all other services performed

with respect to milk.

(h) Examine current economic forces affecting producers, probable

trends in production and consumption, the level of dairy farm prices in

relation to costs, the financial conditions of dairy farmers, and the

need for an emergency order to relieve critical conditions on dairy

farms.

§ 9. Equitable farm prices.

(a) The powers granted in this section and section ten of this compact

shall apply only to the establishment of a compact over-order price, so

long as federal milk marketing orders remain in effect in the region. In

the event that any or all such orders are terminated, this article shall

authorize the commission to establish one or more commission marketing

orders, as herein provided, in the region or parts thereof as defined in

the order.

(b) A compact over-order price established pursuant to this section

shall apply only to class I milk. Such over-order price shall not exceed

one dollar and fifty cents per gallon. Beginning in nineteen hundred

ninety, and using that year as a base, the foregoing one dollar and

fifty cents per gallon maximum shall be adjusted annually by the rate of

change in the consumer price index as reported by the Bureau of Labor

Statistics of the United States Department of Labor. For purposes of the

pooling and equalization of an over-order price, the value of milk used

in other use classifications shall be calculated at the appropriate

class price established pursuant to the applicable federal order or

state dairy regulation and the value of unregulated milk shall be

calculated in relation to the nearest prevailing class price in

accordance with and subject to such adjustments as the commission may

prescribe in regulations.

(c) A commission marketing order shall apply to all classes and uses

of milk.

(d) The commission is hereby empowered to establish the minimum price

for milk to be paid by pool plants, partially regulated plants and all

other handlers receiving milk from producers located in a regulated

area. This price shall be established either as a compact over-order

price or by one or more commission marketing orders. Whenever such a

price has been established by either type of regulation, the legal

obligation to pay such price shall be determined solely by the terms and

purpose of the regulation without regard to the situs of the transfer of

title, possession or any other factors not related to the purposes of

the regulation and this compact. Producer-handlers as defined in an

applicable federal market order shall not be subject to a compact

over-order price. The commission shall provide for similar treatment of

producer-handlers under commission marketing orders.

(e) In determining the price, the commission shall consider the

balance between production and consumption of milk and milk products in

the regulated area, the costs of production including, but not limited

to the price of feed, the cost of labor including the reasonable value

of the producer's own labor and management, machinery expense, and

interest expense, the prevailing price for milk outside the regulated

area, the purchasing power of the public and the price necessary to

yield a reasonable return to the producer and distributor.

(f) When establishing a compact over-order price, the commission shall

take such action as necessary and feasible to ensure that the over-order

price does not create an incentive for producers to generate additional

supplies of milk.

(g) The commission shall whenever possible enter into agreements with

state or federal agencies for exchange of information or services for

the purpose of reducing regulatory burden and cost of administering the

compact. The commission may reimburse other agencies for the reasonable

cost of providing these services.

§ 10. Optional provisions for pricing order.

Regulations establishing a compact over-order price or a commission

marketing order may contain, but shall not be limited to, any of the

following:

(a) Provisions classifying milk in accordance with the form in which

or purpose for which it is used, or creating a flat pricing program.

(b) With respect to a commission marketing order only, provisions

establishing or providing a method for establishing separate minimum

prices for each use classification prescribed by the commission, or a

single minimum price for milk purchased from producers or associations

of producers.

(c) With respect to an over-order minimum price, provisions

establishing or providing a method for establishing such minimum price

for class I milk.

(d) Provisions for establishing either an over-order price or a

commission marketing order may make use of any reasonable method for

establishing such price or prices including flat pricing and formula

pricing. Provision may also be made for location adjustments, zone

differentials and for competitive credits with respect to regulated

handlers who market outside the regulated area.

(e) Provisions for the payment to all producers and associations of

producers delivering milk to all handlers of uniform prices for all milk

so delivered, irrespective of the uses made of such milk by the

individual handler to whom it is delivered, or for the payment of

producers delivering milk to the same handler of uniform prices for all

milk delivered by them.

(1) With respect to regulations establishing a compact over-order

price, the commission may establish one equalization pool within the

regulated area for the sole purpose of equalizing returns to producers

throughout the regulated area.

(2) With respect to any commission marketing order, as defined in

subdivision (i) of section two of this compact, which replaces one or

more terminated federal orders or state dairy regulation, the marketing

area of now separate state or federal orders shall not be merged without

the affirmative consent of each state, voting through its delegation,

which is partly or wholly included within any such new marketing area.

(f) Provisions requiring persons who bring class I milk into the

regulated area to make compensatory payments with respect to all such

milk to the extent necessary to equalize the cost of milk purchased by

handlers subject to a compact over-order price or commission marketing

order. No such provisions shall discriminate against milk producers

outside the regulated area. The provisions for compensatory payments may

require payment of the difference between the class I price required to

be paid for such milk in the state of production by a federal milk

marketing order or state dairy regulation and the class I price

established by the compact over-order price or commission marketing

order.

(g) Provisions specially governing the pricing and pooling of milk

handled by partially regulated plants.

(h) Provisions requiring that the account of any person regulated

under a compact over-order price shall be adjusted for any payments made

to or received by such persons with respect to a producer settlement

fund of any federal or state milk marketing order or other state dairy

regulation within the regulated area.

(i) Provisions requiring the payment by handlers of an assessment to

cover the costs of the administration and enforcement of such order

pursuant to subdivision (a) of section eighteen of this compact.

(j) Provisions for reimbursement to participants of the Women, Infants

and Children Special Supplemental Food Program of the United States

Child Nutrition Act of 1966.

(k) Other provisions and requirements as the commission may find are

necessary or appropriate to effectuate the purposes of this compact and

to provide for the payment of fair and equitable minimum prices to

producers.

ARTICLE V. RULEMAKING PROCEDURE

§ 11. Rulemaking procedure.

Before promulgation of any regulations establishing a compact

over-order price or commission marketing order, including any provision

with respect to milk supply under subdivision (f) of section nine of

this compact, or amendment thereof, as provided in article IV of this

compact, the commission shall conduct an informal rulemaking proceeding

to provide interested persons with an opportunity to present data and

views. Such rulemaking proceeding shall be governed by section four of

the Federal Administrative Procedure Act, as amended (5 U.S.C. Sec.

553). In addition, the commission shall, to the extent practicable,

publish notice of rulemaking proceedings in the official register of

each participating state. Before the initial adoption of regulations

establishing a compact over-order price or a commission marketing order

and thereafter before any amendment with regard to prices or

assessments, the commission shall hold a public hearing. The commission

may commence a rulemaking proceeding on its own initiative or may in its

sole discretion act upon the petition of any person including individual

milk producers, any organization of milk producers or handlers, general

farm organizations, consumer or public interest groups, and local, state

or federal officials.

§ 12. Findings and referendum.

(a) In addition to the concise general statement of basis and purpose

required by section 4(b) of the Federal Administrative Procedure Act, as

amended (5 U.S.C. Sec. 553(c)), the commission shall make findings of

fact with respect to:

(1) Whether the public interest will be served by the establishment of

minimum milk prices to dairy farmers under article IV of this compact.

(2) What level of prices will assure that producers receive a price

sufficient to cover their costs of production and will elicit an

adequate supply of milk for the inhabitants of the regulated area and

for manufacturing purposes.

(3) Whether the major provisions of the order, other than those fixing

minimum milk prices, are in the public interest and are reasonably

designed to achieve the purposes of the order.

(4) Whether the terms of the proposed regional order or amendment are

approved by producers as provided in section thirteen of this compact.

§ 13. Producer referendum.

(a) For the purpose of ascertaining whether the issuance or amendment

of regulations establishing a compact over-order price or a commission

marketing order, including any provision with respect to milk supply

under subdivision (f) of section nine of this compact, is approved by

producers, the commission shall conduct a referendum among producers.

The referendum shall be held in a timely manner, as determined by

regulation of the commission. The terms and conditions of the proposed

order or amendment shall be described by the commission in the ballot

used in the conduct of the referendum, but the nature, content, or

extent of such description shall not be a basis for attacking the

legality of the order or any action relating thereto.

(b) An order or amendment shall be deemed approved by producers if the

commission determines that it is approved by at least two-thirds of the

voting producers who, during a representative period determined by the

commission, have been engaged in the production of milk the price of

which would be regulated under the proposed order or amendment.

(c) For purposes of any referendum, the commission shall consider the

approval or disapproval by any cooperative association of producers,

qualified under the provisions of the act of congress of February

eighteen, nineteen hundred twenty-two, as amended, known as the

Capper-Volstead Act, bona fide engaged in marketing milk, or in

rendering services for or advancing the interests of producers of such

commodity, as the approval or disapproval of the producers who are

members or stockholders in, or under contract with, such cooperative

association of producers, except as provided in paragraph one of this

subdivision and subject to the provisions of paragraphs two, three, four

and five of this subdivision:

(1) No cooperative which has been formed to act as a common marketing

agency for both cooperatives and individual producers shall be qualified

to block vote for either.

(2) Any cooperative which is qualified to block vote shall, before

submitting its approval or disapproval in any referendum, give prior

written notice to each of its members as to whether and how it intends

to cast its vote. The notice shall be given in a timely manner as

established, and in the form prescribed by the commission.

(3) Any producer may obtain a ballot from the commission in order to

register approval or disapproval of the proposed order.

(4) A producer who is a member of a cooperative which has provided

notice of its intent to approve or not to approve a proposed order, and

who obtains a ballot and with such ballot expresses his approval or

disapproval of the proposed order, shall notify the commission as to the

name of the cooperative of which he or she is a member, and the

commission shall remove such producer's name from the list certified by

such cooperative with its corporate vote.

(5) In order to insure that all milk producers are informed regarding

a proposed order, the commission shall notify all milk producers that an

order is being considered and that each producer may register his or her

approval or disapproval with the commission either directly or through

his or her cooperative.

§ 14. Termination of over-order price or marketing order.

(a) The commission shall terminate any regulations establishing an

over-order price or commission marketing order issued under this article

whenever it finds that such order or price obstructs or does not tend to

effectuate the declared policy of this compact.

(b) The commission shall terminate any regulations establishing an

over-order price or a commission marketing order issued under this

article whenever it finds that such termination is favored by a majority

of the producers who, during a representative period determined by the

commission, have been engaged in the production of milk the price of

which is regulated by such order; but such termination shall be

effective only if announced on or before such date as may be specified

in such marketing agreement or order.

(c) The termination or suspension of any order or provision thereof,

shall not be considered an order within the meaning of this article and

shall require no hearing, but shall comply with the requirements for

informal rulemaking prescribed by section four of the Federal

Administrative Procedure Act, as amended (5 U.S.C. Sec. 553).

ARTICLE VI. ENFORCEMENT

§ 15. Records, reports, access to premises.

(a) The commission may by rule and regulation prescribe record keeping

and reporting requirements for all regulated persons. For purposes of

the administration and enforcement of this compact, the commission is

authorized to examine the books and records of any regulated person

relating to his or her milk business and for that purpose, the

commission's properly designated officers, employees, or agents shall

have full access during normal business hours to the premises and

records of all regulated persons.

(b) Information furnished to or acquired by the commission officers,

employees, or its agents pursuant to this section shall be confidential

and not subject to disclosure except to the extent that the commission

deems disclosure to be necessary in any administrative or judicial

proceeding involving the administration or enforcement of this compact,

an over-order price, a compact marketing order, or other regulations of

the commission. The commission may promulgate regulations further

defining the confidentiality of information pursuant to this section.

Nothing in this section shall be deemed to prohibit (1) the issuance of

general statements based upon the reports of a number of handlers, which

do not identify the information furnished by any person, or (2) the

publication by direction of the commission of the name of any person

violating any regulation of the commission, together with a statement of

the particular provisions violated by such person.

(c) No officer, employee, or agent of the commission shall

intentionally disclose information, by inference or otherwise, which is

made confidential pursuant to this section. Any person violating the

provisions of this section shall upon conviction be subject to a fine of

not more than one thousand dollars or by imprisonment for not more than

one year, or by both, and shall be removed from office. The commission

shall refer any allegation of a violation of this section to the

appropriate state enforcement authority or United States attorney.

§ 16. Subpoena, hearings and judicial review.

(a) The commission is hereby authorized and empowered by its members

and its properly designated officers to administer oaths and issue

subpoenas throughout all signatory states to compel the attendance of

witnesses and the giving of testimony and the production of other

evidence.

(b) Any handler subject to an order may file a written petition with

the commission stating that any such order or any provision of any such

order or any obligation imposed in connection therewith is not in

accordance with law and praying for a modification thereof or to be

exempted therefrom. He shall thereupon be given an opportunity for a

hearing upon such petition, in accordance with regulations made by the

commission. After such hearing, the commission shall make a ruling upon

the prayer of such petition which shall be final, if in accordance with

law.

(c) The district courts of the United States in any district in which

such handler is an inhabitant, or has his principal place of business,

are hereby vested with jurisdiction in equity to review such ruling,

provided a bill in equity for that purpose is filed within thirty days

from the date of the entry of such ruling. Service of process in such

proceedings may be had upon the commission by delivering to it a copy of

the bill of complaint. If the court determines that such ruling is not

in accordance with law, it shall remand such proceedings to the

commission with directions either (1) to make such ruling as the court

shall determine to be in accordance with law, or (2) to take such

further proceedings as, in its opinion, the law requires. The pendency

of proceedings instituted pursuant to this subdivision shall not impede,

hinder, or delay the commission from obtaining relief pursuant to

section seventeen of this compact. Any proceedings brought pursuant to

section seventeen of this compact (except where brought by way of

counterclaim in proceedings instituted pursuant to this section) shall

abate whenever a final decree has been rendered in proceedings between

the same parties, and covering the same subject matter, instituted

pursuant to this section.

§ 17. Enforcement with respect to handlers.

(a) Any violation by a handler of the provisions of regulations

establishing an over-order price or a commission marketing order, or

other regulations adopted pursuant to this compact shall:

(1) Constitute a violation of the laws of each of the signatory

states. Such violation shall render the violator subject to a civil

penalty in an amount as may be prescribed by the laws of each of the

participating states, recoverable in any state or federal court of

competent jurisdiction. Each day such violation continues shall

constitute a separate violation.

(2) Constitute grounds for the revocation of license or permit to

engage in the milk business under the applicable laws of the

participating states.

(b) With respect to handlers, the commission shall enforce the

provisions of this compact, regulations establishing an over-order

price, a commission marketing order or other regulations adopted

hereunder by:

(1) Commencing an action for legal or equitable relief brought in the

name of the commission in any state or federal court of competent

jurisdiction; or

(2) With the agreement of the appropriate state agency of a

participating state, by referral to the state agency for enforcement by

judicial or administrative remedy.

(c) With respect to handlers, the commission may bring an action for

injunction to enforce the provisions of this compact or the order or

regulations adopted thereunder without being compelled to allege or

prove that an adequate remedy of law does not exist.

ARTICLE VII. FINANCE

§ 18. Finance of start up and regular costs.

(a) To provide for its start-up costs, the commission may borrow money

pursuant to its general power under paragraph four of subdivision (d) of

section six of this compact. In order to finance the costs of

administration and enforcement of this compact, including payback of

start-up costs, the commission is hereby empowered to collect an

assessment from each handler who purchases milk from producers within

the region. If imposed, this assessment shall be collected on a monthly

basis for up to one year from the date the commission convenes, in an

amount not to exceed one-tenth of one percent of the applicable federal

market order blend price per hundredweight of milk purchased from

producers during the period of the assessment. The initial assessment

may apply to the projected purchases of handlers for the two-month

period following the date the commission convenes. In addition, if

regulations establishing an over-order price or a compact marketing

order are adopted, they may include an assessment for the specific

purpose of their administration. These regulations shall provide for

establishment of a reserve for the commission's ongoing operating

expenses.

(b) The commission shall not pledge the credit of any participating

state or of the United States. Notes issued by the commission and all

other financial obligations incurred by it, shall be its sole

responsibility and no participating state or the United States shall be

liable therefor.

§ 19. Audit and accounts.

(a) The commission shall keep accurate accounts of all receipts and

disbursements, which shall be subject to the audit and accounting

procedures established under its rules. In addition, all receipts and

disbursements of funds handled by the commission shall be audited yearly

by a qualified public accountant and the report of the audit shall be

included in and become part of the annual report of the commission.

(b) The accounts of the commission shall be open at any reasonable

time for inspection by duly constituted officers of the participating

states and by any persons authorized by the commission.

(c) Nothing contained in this article shall be construed to prevent

commission compliance with laws relating to audit or inspection of

accounts by or on behalf of any participating state or of the United

States.

ARTICLE VIII. ENTRY INTO FORCE; ADDITIONAL MEMBERS AND WITHDRAWAL

§ 20. Entry into force; additional members.

The compact shall enter into force effective when enacted into law by

any three states of the group of states composed of Connecticut,

Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New

York, Pennsylvania, Rhode Island, Vermont and Virginia and when the

consent of congress has been obtained. This compact shall also be open

to states which are contiguous to any of the named states and open to

states which are contiguous to participating states.

§ 21. Withdrawal from compact.

Any participating state may withdraw from this compact by enacting a

statute repealing the same, but no such withdrawal shall take effect

until one year after notice in writing of the withdrawal is given to the

commission and the governors of all other participating states. No

withdrawal shall affect any liability already incurred by or chargeable

to a party state prior to the time of such withdrawal.

§ 22. Severability.

If any part or provision of this compact is adjudged invalid by any

court, such judgment shall be confined in its operation to the part or

provision directly involved in the controversy in which such judgment

shall have been rendered and shall not affect or impair the validity of

the remainder of this compact.

Congress reserves the right to amend or rescind this interstate

compact at any time.

§ 23. Reservation of rights.

(a) In general. The right to alter, amend, or repeal this compact is

expressly reserved.

(b) Compensation requirement. When an over-order price is in effect,

the commission established in this compact shall compensate the

commodity credit corporation before the end of the fiscal year for the

cost of any increased commodity credit corporation dairy purchases that

result from projected increased fluid milk production for that fiscal

year within the compact region in excess of the national average rate of

increase.