Colorado Legislative Council Staff

NO FISCAL IMPACT

TITLE:            CONCERNING THE EFFECTIVENESS OF APPLE MARKETING ORDERS, AND, IN CONNECTION THEREWITH, ENHANCING THE ACCOUNTABILITY OF THE BOARD OF CONTROL.

Summary of Assessment

            This bill revises the "Marketing Act of 1939" by adding a new section regarding apple marketing orders. The bill requires the board of control of an apple marketing order to establish sales and promotion plans, and to develop procedures for cost-benefit analysis of expenditures for advertising and sales promotions. The bill prohibits the board from expending moneys for political influence, including the employment of lobbyists.

            The bill requires the decision for continuance of an apple marketing order to be submitted to the apple growers covered by the order for approval every three years. Votes are to be tallied by the board under the supervision of the Department of Agriculture. The bill requires the order to be automatically terminated if an annual audit is not filed with the Commissioner of Agriculture and the Governor. The bill specifies a certain expenditure limit for the costs of attorney services to promote the order.

            The bill requires a minimum of 50 percent of the apple growers covered by the order to approve termination or revision of the order. Determinations of annual assessments are considered exempt from this vote requirement. The bill requires any apple marketing order to contain provisions for deferment and exemption of assessments by September 1, 1999. The bill requires expansion of an existing order to be approved by at least a simple majority of the apple growers in the region to be added to the order. The bill will become effective 90 days after adjournment, unless a referendum petition is filed.

            Under current law, the board of control of an agricultural marketing order prepares a budget for the administration and operating expenses of the marketing order. This budget is to be reviewed and approved by the Commissioner of Agriculture. Every person directly affected by the marketing order is assessed a fee to cover the marketing order operating budget. Therefore, marketing order operating budgets are self-funded and are not an element of state or local government budgeting processes.

            This bill may reduce marketing order operating costs by prohibiting lobbying expenses, or may increase administrative costs. These changes do not affect state or local government revenue or expenditures. Therefore, this bill is assessed as having no fiscal impact.

Departments Contacted

            Agriculture                 State Auditor