May 14, 2007
By JOHN FLOWERS
MONTPELIER — The state’s General Assembly last week overwhelmingly supported a bill that directs the Vermont Milk Commission to establish a minimum milk price that would relieve farmers from the costs of having their product hauled to processing facilities.
The bill, if signed into law, could result in savings of $7 million per year to Addison County farmers alone, according to Sen. Harold Giard, D-Bridport, the chief architect of bill S.78.
“This is such a monumental piece of legislation,” Giard, a member of the Senate Agriculture Committee, said on Tuesday. “This is $7 million that will stay in Addison County. This is jobs on Main Street.”
Approximately 60 cents per hundredweight of milk is currently deducted from farmers’ milk checks to cover the expense of hauling their product to processors. Farmers pay another $6 to $8 every time a hauling truck stops for a load of milk, according to Giard.
The hauling and stop charges have been tough for farmers to absorb, given surging energy prices and a stagnant price for milk. In 1980, the average price paid for milk was $13.06 per hundredweight, which, when adjusted for inflation, is equivalent to $30.95 in 2006 dollars. The average price for milk in 2006 was $12.88.
Bill S.78 calls for the Vermont Milk Commission to hold hearings and come up with a milk price that will free farmers from the stop and hauling charges, which Giard suspects will be “passed upstream,” to the extent that “the cost of hauling milk is paid by the purchaser.”
Giard believes that consumers will be willing to spend an extra 5 cents or more per gallon of milk, and slightly more for other dairy products, if they know that farmers are directly benefiting.
“I don’t think the consumer is going to notice it,” Giard said.
Local lawmakers are upbeat about S.78, though the legislation faces a few more hurdles before it will be able to deliver some relief to farmers.
First, the bill must be signed by Gov. James Douglas, which he intends to do, according to Denise Casey, interim spokeswoman for the Middlebury Republican.
If passed into law, the Vermont Milk Commission will listen to testimony on stop and hauling charges, reporting back to the House and Senate Agriculture Committees by Nov. 1. As the bill is written, the new milk price affecting stop and hauling charges would take effect “when, by rule, legislation or other agreement, New York and one other state in the Northeast Marketing Area… have accomplished the purpose of this act, or on Jan. 15, 2009, whichever comes first.”
Any rule the milk commission establishes on stop and hauling charges could be appealed directly to the Vermont Supreme Court, according to Vermont Assistant Attorney General Michael Duane.
Harold Howrigan, a longtime Fairfield dairy farmer and member of the Vermont Milk Commission, knows he and his colleagues will have their work cut out for them.
“I think it’s a very laudable idea,” Howrigan said of taking stop and hauling charges off the backs of farmers. “But I think it’s going to be a little more difficult to initiate than the proponents think.”
Howrigan noted the tough negotiations that take place between dairy cooperatives and milk processors. Those negotiations, he said, often come down to “fractions of a cent,” leaving little wiggle room for other items.
Howrigan said his farm has been able to manage its hauling expenses by delivering its own milk to the processors, though he realizes not all farms can afford to take that same action.
Giard believes S.78 has adequate safeguards to prevent dairy co-ops or processors from circumventing the stop and hauling charge plan.
“No additional charges shall be made, and no costs may be shifted from other benefits the farmer receives, to contravene the purpose of this act,” the legislation reads.
Giard also believes that other states will join Vermont in removing stop and hauling charges from farmers. Giard said he has spoken with agricultural officials from New York, New Hampshire, Connecticut, Massachusetts and Pennsylvania, some of whom have expressed a willingness to follow in Vermont’s footsteps.
“This is a piece of legislation I am convinced will go clear across the country,” Giard said. “This is one more area of leadership and courage that is being shown by the state of Vermont.”