State Agricultural Marketing Orders
Pooling Your Resources
Imagine that that you and your neighbors enjoy swimming, but none of you has a pool at your house. Furthermore, none of you can individually afford to have one installed. One solution: get all the neighbors to “pool” financial resources.
A plan could be devised where each household would annually pay a small amount into a “swimming pool fund.” This fund would be used to construct and maintain a community pool that all the neighbors could use.
This cost-sharing concept, where people pool money to fund something they can’t afford on their own, is basically how a State Agricultural Marketing Order works.
On the Farm
There are thousands of small producers in Florida who depend on scientific research and marketing campaigns to grow and market their crops. Most cannot afford to own and operate their own laboratories and marketing firms, or maintain the staff it would take to run them. However, these small producers sometimes formally organize and vote to contribute small, set amounts into a “pot” for such activities. Then they use the pot of money to contract with professional firms that specialize in research and marketing. So instead of a swimming pool fund, it may be a peanut fund or a citrus fund. These are called Marketing Orders.
What is a Marketing Order?
A Marketing Order establishes, by vote of the producers, a self-imposed assessment or fee to be used for a variety of industry activities. Activities might include:
-- Advertising and promoting their agricultural products.
-- Expanding markets and distribution channels.
-- Researching improved growing techniques.
-- Regulating the quality and grades of their products.
-- Regulating trade practices.
-- Resolving other critical problems and needs in the industry.
Interested in establishing a Marketing Order?
Florida Law defines how agricultural groups can establish Marketing Orders and there are some required steps to create one:
1. First, interested producers must get together and share their information and plans with other farmers growing the same crop.
2. When 10 percent or more of all the producers in the state who produce the specific crop agree they want a Marketing Order, they submit their proposal to the Commissioner of Agriculture and officially start the process.
3. The producers pay a modest fee to the Department of Agriculture and Consumer Services to cover the administrative costs of creating the Marketing Order. (This money may be refunded if the marketing order is passed.)
4. Public hearings are held to allow producers of the specific crop an opportunity to voice their opinions. Anyone can submit written comments to the Department.
5. If the Marketing Order has enough support (at least 10 percent of all affected producers), and there is evidence that it will accomplish its goals, the Commissioner of Agriculture will call for a vote.
6. The next step is the actual vote, or referendum. All those directly affected are given the chance to vote on the final proposed Marketing Order. Ballots are mailed to producers and returned to the Department for counting.
7. If the vote passes, the Marketing Order goes into effect. Once passed, a formal Advisory Council is appointed to make recommendations to the Commissioner of Agriculture on how the Marketing Order will be administered and money spent.
How many votes are needed to pass a Marketing Order?
A Marketing Order must be approved by 65 percent of those voting, representing at least 51 percent of the voting acreage (or, in some cases, production amount). For example, if 100 mango producers had a total of 1,000 acres, then 65 growers with at least 510 acres would need to vote in favor for the Marketing Order to pass. The formula can get complicated since producers have different sized operations and often a variety of crops. A producer lists his eligible voting acreage (or production amount) on his ballot before submitting it.
Who oversees the Marketing Order?
The Department of Agriculture and Consumer Services enforces the Marketing Order. A Department marketing professional is assigned to receive funds and keep accurate records on all expenditures, contracts and projects. The Advisory Council, representing all the producers, recommends how the money should be spent by creating an annual budget and holding regular meetings.
How is money collected for the Marketing Order?
When a Marketing Order is put forth for a referendum, it states the predetermined “fair share” amount that every producer of the commodity would be assessed if the Marketing Order passes. Think of this as a self-imposed tax or fee, where each producer pays a set amount usually based on volume. For example, a producer may pay a few pennies for each box of produce, or a few dollars for each ton of his crop that is sold.
If the Marketing Order passes and becomes a law, then all producers of that crop must pay the fee unless given a special exemption by the Department. The Marketing Order may contain provisions that allow the Advisory Council to recommend that the Department adjust the fee or create “caps” or maximum amounts that producers would pay. The Marketing Order may also contain provisions that allow changes by vote of the majority of affected producers.
Who makes up the Advisory Council?
Members must be legitimate and active agricultural representatives who have a vested interest in the Marketing Order. Seven members and seven alternates make up an Advisory Council. Members are usually nominated by those participating in the Marketing Order, and are ultimately appointed by the Commissioner. They are not paid for serving on the council, but some official business expenses may be reimbursed. The Commissioner of Agriculture goes to great lengths to ensure there is equitable and diverse representation for everyone involved in a Marketing Order.
What does the Advisory Council do?
The Advisory Council:
-- Advises the Department on industry needs and priorities.
-- Recommends rules and regulations for managing the Marketing Order.
-- Advises how money should be collected and spent.
-- Establishes committees and subcommittees to carry out assigned specific duties and projects related to the Marketing Order.
-- Assists with the formulation of contracts for services (i.e., research, marketing).
-- Receives and reports any complaints or violations of the Marketing Order.
-- Suggests changes and improvements that could enhance the industry.
How do Marketing Orders end?
A Marketing Order may be discontinued in two ways:
1. The Department of Agriculture and Consumer Services may suspend or end a Marketing Order if it deems the order is not serving its original purpose.
2. If 51 percent of the producers covered by the Marketing Order who produce more than 51 percent of the commodity vote to cease the Marketing Order.
What happens if someone does not follow the Marketing Order?
Any person that violates a marketing order can be prosecuted by law.
