Farm First Dairy Policy

PREAMBLE

Dairy farmers deserve a fair price for their production. To that end, we seek policies that improve
farm income, balance milk supply and demand, end regional price discrimination, strengthen,
and promote the family farm, protect against unfair international trading practices, and share our
great abundance of a safe food supply with consumers at home and abroad.

1. FEDERAL DAIRY POLICY

In order to maintain a strong and healthy Midwestern dairy industry, dairy farmers need to receive an equitable milk price over the cost of production. To ensure this, any support programs need to be adjusted accordingly to reflect current production costs.

We support:

• Continued improvement to the Dairy Margin Coverage (DMC) program to better reflect true feed costs which include feed processing and feed supplementation costs and also reflect the true cost of doing business.

• Congress levying tariffs and quotas on any imported milk protein concentrates (MPCs), casein, and milk derivative products. Further state and federal customs inspectors should actively look for and report illegal uses of imported milk products.

• The Administration, Congress, and USDA to enforce all agriculture laws and regulations that have been enacted to ensure the survival of our family farms.

• Congress and state officials to call for and/or continue anti-trust investigations into the concentration of the dairy industry and other agricultural commodity industries.

• A uniform, national dairy policy that treats all dairy farmers equitably regardless of where
they live or where they market their milk.

• The Agricultural Marketing Act of 1937 as amended and the Federal Milk Marketing Order system.

• USDA payments and programs being directed to family based dairy farms.

• Equal dairy promotion assessments on dairy imports.

• Dairy plant security programs that ensure producer payments in the event of a plant’s failure to pay.

• The research and development of a national dairy growth/supply management plan and other systems that provide increased dairy industry stability and producer profitability.

We oppose:

• Any assessment or tax on milk per hundredweight from the farm.

• Any weakening of national organic standards.

2. FEDERAL MILK MARKETING ORDERS

We support:

• Equity and simplicity to the federal order system, to improve family farm income and stabilize dairy markets.

• Changes to the order referendum process to allow any proposed order amendments to be
rejected without eliminating the existing federal order.

• Restructuring Class III pricing to include the value of butterfat not addressed in the production of high-volume cheeses (i.e., mozzarella, other low-fat Italian cheeses, and whey proteins) which are currently not reflected in the pricing formula.

• Changes to accelerate the rule-making process of milk marketing orders.

• A restructured federal order system to provide maximum equity through much more uniform Class I differentials and address other issues including but not limited to negative Producer Price Differentials.

• NMPF proposed changes to the order system, including returning to the “higher of” for the Class I mover, updating dairy product make allowances”, discontinuing the use of barrel cheese in the protein component price formula, updating milk component factors, and updating Class I price differentials and require mandatory and accurate make allowance surveys of all processors.

We oppose:

• Any regulations tightening the pooling provisions.

• Any new classes of milk that would subsidize the production of MPCs.

3. INTERNATIONAL TRADE & HARMONIZED WORLD STANDARDS

National policies should recognize the “multi-functional” value of family farms at home and abroad. These benefits include food security, social and family values, economic enhancement, protection of the environment, preservation of rural culture, tourism, and other important values unique to family farms. We seek to work further with private and public officials internationally, who share our strong commitment to working for needed international trade reforms,
maintaining our strong domestic dairy markets, and preserving and strengthening family farms in
our respective countries. U.S. trading tariffs should not be reduced or exchanged for U.S. foreign policy. Our concerns
with trade agreements include:

• The preservation or weakening of tariff rate quotas.

• Unequal export subsidy reductions

• Currency exchange rate variations

• Failure to harmonize global sanitation standards at adequate levels.

• Inadequate rules of origin.

• Genetically modified organisms (GMOs) not creating trade barriers.

• Bio-security issues

We support:

• U.S. trade agreements being “fair” trade and not free trade in dealing with all agricultural products.

• Imported food products being produced and processed under sanitation standards that are comparable to USDA sanitation standards. Any imports that do not meet these standards along with any added illegal products should be immediately stopped at the border. Consumer safety demands that 100% of imports be USDA inspected.

• The cost of USDA inspection of foreign producers and processors to verify compliance being charged to the producers of imported products just as U.S. inspections are financed through farm and plant inspection fees.

• Any U.S. owned company or cooperative producing dairy products in other countries to be subject to all quotas and tariffs on products imported into the U.S.

• Aggressive action to ensure that all countries that are parties to bilateral, multilateral, or regional trade agreements fully comply with such agreements.

• Federal, state, and local governments to promote the safe and environmentally sound production of products within the U.S. to reduce or eliminate our reliance on these products from other countries both for cost savings and national security reasons.

• Legislation and other efforts to address the causes of port delays which adversely affect dairy exports and imports of farm production products.

We oppose:

• Any trade agreement which results in unbalanced, harmful inequities within our dairy industry.

• Trade agreements that sacrifices dairy interests for gains by other U.S. industries or agricultural commodities.

• The federal government applying tariffs that artificially inflate prices for products used in farm operations.

4. INCENTIVE PROGRAMS

We support incentive programs for beginning farmers (i.e., loans, tax incentives and grants), through existing lending institutions and government agencies that assist in the transfer or startup of a farm.

We oppose the idea of any policy for the federal or state government to purchase farmland that will then be sold at a discount or given to any person or group of persons, or the forgiveness of legitimate debt solely based upon but not limited to their race, religion, gender, or ethnic background.

5. TRADEMARK/COMMON NAMES/GEOGRAPHIC INDICATORS

Product names in domestic and international trade are important aspects of consumer identification. Names like parmesan, mozzarella, asiago, and feta are common food names.

We oppose efforts by trading partners to register or trademark common names of dairy products
as intellectual property to protect their own domestic dairy industry.

6. NATURAL CHEESE STANDARDS

We support stronger enforcement of U.S. natural cheese standards regulations by the USDA. Further, we support the establishment of a standard of identity for cheeses that currently do not have a standard of identity.

We oppose:

• Revisions to U.S. natural cheese standards that would weaken domestic cheese standards by allowing the use of imported milk protein concentrates, casein and other imported products derived from milk and non-dairy ingredients in the manufacturing of cheese. This effort would be harmful to U.S. dairy farmers and confuse consumers with respect to truth in labeling.

• The use of the word “cheese” on products that do not meet natural cheese standards including lab grown and plant based “cheese.”

7. CONSUMER AWARENESS

We support:

• FDA and other industry partners to label fluid milk by the percentage of fat-free content rather than by the percentage of fat content.

• The harmonization of world food safety standards to the high levels required on U.S. dairy farms and plants for the benefit of farmers and consumers.

• Imported dairy and other food products being clearly labeled with the Country of Origin (COOL). Food products manufactured in the U.S. which use an imported dairy product as an ingredient should be clearly labeled as containing imported dairy products; just as many other imported consumer products are labeled.

• Labeling including the Real Seal being accurate and enforced. We support efforts by the National Milk Producers Federation to revitalize the Real Seal program.

• The FDA’s efforts to enforce current labeling laws for dairy products. Terms such as “milk,” “cheese,” and “yogurt” have specific standards of identity and must be protected.

Plant and nut-based products such as almond, soy or rice extract misrepresent dairy products and are examples of mislabeled products which mislead consumers into thinking they are consuming dairy products or that plant and nut-based products have the same nutritional quality as milk and dairy products.

• The Dairy Pride Act.

• Processors to use light blocking agents for milk containers to preserve its quality and taste since light harms milk’s taste and nutrition.

• The FDA rules to require that the word “imitation” be used in the advertising and labeling of imitation cheese and other substitutes for dairy products.

• That all food labels should be easily understood, and any claims should be supported by science.

• Only cheese manufactured in the state it is processed in to be allowed to be labeled as such. ( i.e., Wisconsin cheese)

• June as National Dairy Month.

• Truth in labeling with respect to milk, dairy products and meat produced through the production of lab-grown proteins.

8. DAIRY PRODUCT UTILIZATION

Milk and dairy products should be available to consumers at all times.

We support:

• That all schools be required to offer whole milk as a choice to all students and use only 100% real domestically produced dairy products. All milk (flavored and white) provides the necessary nutritional requirements of a healthy diet.

• Revision of USDA dietary guidelines and National School Lunch guidelines to include full fat dairy products (milk, cheese, butter, and yogurt) as they are part of a healthy and balanced diet. Scientific research has shown that full fat dairy products reduce the risk of diabetes and help people control body weight.

• The National School Lunch Program which now includes flavored milk. Further, we support including lactose-free milk and conducting pilot programs to increase fluid milk consumption in schools.

• Increased use of real, domestically produced dairy products by the U.S. military, government operated facilities and other government supported persons.

• Increased fluid milk solids standards consistent with California standards.

• The continuation and expansion of programs to distribute domestic agricultural commodities to needy people and disaster victims here and abroad.

• State Agencies monitoring the use of funds in Food Assistance Programs to ensure that they are used to purchase qualified nutritional food products only.

• The placement of milk vending machines in state capitals, schools and other public buildings and better distribution of domestic dairy products to retail facilities.

• The use of attractive and easy-to-use packaging for dairy products.

• The availability of lactose-free cow’s milk in grocery stores, nursing homes, etc.

• The current Grade A standards for yogurt.

We oppose:

• Size limits on milk sold and distributed in schools.

• Restrictions on naturally occurring fat, sugar and sodium levels on milk and dairy product purchases in federally funded nutrition and feeding programs.

9. COMMODITY ADVERTISING, RESEARCH, & PROMOTION

The leadership of commodity promotion programs should be directly accountable to the
producers who fund such programs.

We support:

• The election of all national, regional, and state commodity board members by producers
rather than by appointment.

• The national, regional, and state promotion boards to become more aggressive and innovative in their efforts to increase consumer demand for agricultural products. Top priority should be given to programs which promote the many health benefits of milk and dairy products and counteract misleading statements that consuming dairy products is adverse to one’s health.

• That all promotion boards to be as small and efficient as possible. All producer-funded commodity promotion programs should avoid extravagant spending and hold costs for salaries, facilities, per diems, expense accounts and other expenses at reasonable levels.

• A marketing emphasis on flavored milk and other innovative dairy products.

• Other organizations’ promotional programs supporting healthy lifestyles and recognize the efforts by the National Dairy Council and any other new programs.

• Dairy farmers and dairy processors and packaging companies sharing equally in funding the operating expenses of the Center for Dairy Research.

• Support farmer access to A2A2 labeling on dairy products containing A2A2 milk from their dairy herd. Commodity promotion boards should not be allowed to contract, merge or be restructured with organizations involved in lobbying or otherwise violate the ban on using checkoff funds for any type of political activity, however, we support exploring the feasibility and potential benefits of changes to dairy, beef, and other agriculture promotion boards to make them more accountable and in the use of promotion funds.

We oppose:

• Misleading and negative advertising and labeling of real dairy products.

10. DAIRY INSPECTION POLICY

New rules should have input from dairy farmers, processors, veterinarians, and drug manufacturers and should be adequately communicated to all affected parties before implementation.

We support:

• Reasonable and uniform dairy inspections and quality standards for all dairy farmers and encourage state regulators to be reasonable and practical in implementing new interstate restrictions on antibiotics.

• Greater coordination between federal and state milk inspectors so dairy farmers receive the same consistent information from both federal and state inspectors.

• Efforts to ensure a safe and wholesome milk supply.

• Uniform testing procedures for antibiotics, sample retention and other safeguards to prevent the problem of inaccurate readings resulting from inconsistent and/or incompatible tests.

• The scientific community and the FDA to adopt as a priority, creation of a drug screening test program which establishes uniformity at an acceptable cost.

• Allowing exceptions to current rules (i.e., location of well, depth of casing and type of well- sand point or shallow well) if the quality of water is good. These exceptions would require the water to be tested more frequently to ensure the quality of water remains safe.

• Farmers using production practices, including seasonal milking, should not lose their license because of their non-production period.

• The frequency and extent of individual farm inspections should be in direct relation to the quality of milk being produced on each farm and should be equal for all grades of milk.

We oppose efforts to impose more stringent federal and state inspection of U.S. dairy farms.

11. TAX POLICY

We support reform of the federal tax code to provide greater incentives for the survival of the family farm.

We support:

• The federal government giving farmers a fuel tax credit at purchase.

• Members to plan for the orderly transfer of farm assets to succeeding generations to minimize the tax burden and foster continuation of the family farm.

• Allowing retiring farmers to sell their farm assets and roll over all or part of the proceeds into a tax deferred IRA.

• Use value assessment on farmland and farmland preservation tax credits.

• The concept of tax-deferred savings accounts for farmers, to encourage farmers to set aside money that can be withdrawn for farm operating expense in cases of price collapse or natural disaster.

• The use of “stepped up basis” for the purposes of determining when capital gains on inherited assets are taxed.

We oppose:

• Any carbon or methane emission tax to dairy farmers.

• Current policies which encourage wealthy, non-farm investors to use limited partnerships and other tax avoidance schemes to buy into dairy operations and other industrial-type agricultural ventures for tax write-off purposes, which result in unfair, publicly subsidized competition against family farmers and a significant loss of revenue to the U.S. Treasury.

• The sale of farmland to foreign governments and to corporations owned by foreign countries/investors.

• Unfunded federal and state government mandates because they increase local taxes.

• Any sales tax on tax exempt items.

• Extending the “look back” period for purposes of farm and estate transfers.

• The use of recent sales of agricultural property which has been sold for hunting, recreational and other purposes to set property tax valuations on other agricultural property.

12. AGRICULTURE/DAIRY EDUCATION

We urge state departments of agriculture, university extension services, dairy promotion boards, farm and commodity organizations, technical colleges, and all schools to help educate our youth about agriculture, especially dairy farming, and dairy products.

13. ENVIRONMENTAL QUALITY

We support:

• Our members to take an active role in preserving and protecting ground water quality. Due to environmental concerns about pollution of our soils and waters, the siting of new landfills should be subject to a hearing process.

• A common-sense science-based approach to non-point source pollution.

• Programs that would adequately compensate dairy farmers for complying with rules and regulations that would mitigate greenhouse gas emissions. We support existing education of environmental stewardship.

• Having all farms and feedlots identified with a potential pollution problem due to new stricter regulations be offered technical and financial assistance before enforcement action commences. If substantial financial assistance is not available, enforcement action will be postponed until funds become available from the appropriate federal, state, and local government agencies.

• Realistic, science-based, and economically feasible standards to address air and water quality or other pertinent environmental issues and urge voluntary, incentive and assistance-based programs for dairy farmers affected by the Clean Air Act, the Clean Water Act, or other pertinent environmental legislation or regulations.

• Requiring high capacity well permits to be processed within 60 days.

• Farmer-led water quality organizations and initiatives such as proactive efforts to better manage nutrient outputs.

• Requiring Congressional approval of any new federal regulation before final implementation.

• Exempting agriculture from Comprehensive Environmental Response Compensation, and Liability Act (CERCLA) and Emergency Planning and Community Right-to-Know Act (EPCRA)

• State and county officials to establish a fund to ensure environmental safety as we recognize the critical need for managing abandoned wells and manure pits.

• Opportunities for tax credits or expanded environment and/or energy-related programs such as carbon credits as a source of farm income.

• A common-sense science-based approach to issues of agricultural air quality, rural load and width limits and tracking field debris onto roadways that balance the needs of farmers with the construction of rural road budgets.

• USDA control over farm regulation of environmental issues.

• Conservation program payments being extended to hay production and cover crops.

• Implementation of rules based on a clear, consistent, and reasonable definition of what constitutes
Waters of the U.S.

We oppose:

• Green energy initiatives that threaten the existence of animal and food production agriculture and requiring farmers to become carbon neutral. This includes, but is not limited to carbon taxes, the elimination of fossil fuels, eminent domain capture, animal quotas, government restrictions on consumers ability to purchase meat and dairy and any
other government policy that forces undo financial burden on farmers in the name of climate change.

• Any carbon or methane emission tax to dairy farmers.

• The discrimination against dairy farmers by processors using producer environmental data.

• Defining multiple wells located on contiguous land being classified as a high capacity well.

14. FARM AND PUBLIC SAFETY

While we strongly encourage members to practice farm safety, farms employing 10 or fewer employees should continue to be exempted from regulations under OSHA.

We support adequate roads and bridges in rural America.

We support the judicious use of hunting seasons and other means of population control for wildlife animal species to minimize crop damage, asset losses and other hardship losses suffered by farmers and others.

We oppose the establishment of wildlife populations in all farming areas. Wildlife already introduced into these areas have harmed livestock, crops, pets and have threatened people. Dairy farmers should have the right to protect their crops and animals from such species or should be allowed full payment for livestock & crops damaged by wildlife.
We oppose drastic changes to food production & pesticide use without a farmer represented comprehensive plan that includes financial assistance.

15. STRAY VOLTAGE & POWER LINE SITING

We support:

• Greater cooperation from all parties involved to work for solutions to the problem of stray voltage and power line siting and safety.

• Further study of wind and solar power electricity as a source of energy and how they relate to effects of static or stray voltage that may be found in generation or transmission of this power.

• Third party independent testing with government oversight.

• The funding of research on stray voltage by colleges and universities.

• The establishment of regulations which require electric utility companies to correct and prevent occurrences of stray voltage. We encourage members to regularly check their animal housing units for stray voltage.

16. ANIMAL HEALTH & CARE

Maintaining consumer confidence in the nation’s food supply and educating consumers on historical practices in agriculture is critically important. At the heart of this is quality animal care in livestock production. Imported cattle controls and other necessary regulatory efforts should be maintained to prevent introduction of disease into the U.S. If it is determined that a comprehensive national animal identification system is needed, we believe that it should be accurate and confidential, minimize additional paperwork and recognize that the original owner has no control over the animal once it leaves the farm. No imports of meat or dairy products from countries that are known to have contagious diseases shall be allowed into this country.

We support:

• Animal identification programs being administered by a third party.

• The ethical and humane treatment of animals by farmers, handlers, and processors.

• Programs like FARM (Farmers Assuring Responsible Management) as developed by the National Milk Producers Federation to inform market participants about the sound and ethical production practices involved in livestock agriculture by implementing verification programs to ensure consumers of these practices. Any updates to the FARM program should have greater farmer input before implementation.

• Allowing audio and/or visual recording on private property, including farms and livestock
handling facilities, but only if approved by the facility owners.

• Legislation pertaining to animal welfare being reviewed by States’ Department of Agriculture and referred to appropriate agriculture committees within States’ Legislatures.

• The efforts of organizations that establish livestock identification information systems to protect animal health and market access. This would include the continuation and maintenance of the mandatory state premises registration program.

• Efforts made by the Wisconsin Livestock Identification Consortium to develop the Identifying Wisconsin Branded Tag program.

• Fast-track programs that provide incentives to encourage the training and education of students in food animal veterinary practices.

• A farmer’s right, in consultation with their veterinarians, to set appropriate protocol for common animal husbandry practices to be administered by the farmer or trained employee that are appropriate for their farm.

• Further education of consumers on the merits of common animal husbandry practices.

• All state and federal departments of agriculture to fund programs for all testing and elimination of Johne’s Disease, Bovine spongiform encephalopathy (BSE), Foot & Mouth Disease, TB, H5N1 and other contagious diseases and reimbursement for all animals destroyed due to an outbreak.

• Proper education for dairy farmers relating to necessary therapeutic medications & precautionary measures to include a good veterinarian/client relationship with proper record-keeping that ensures a wholesome product for the consumer.

We oppose:

• Government/processor mandated vaccination of farm animals.

• Government/processor mandated methane reducing feed additives.

17. LIVESTOCK

We support:

• The beef checkoff being taken only at the point of slaughter.

• Prohibiting packers from owning livestock for more than 14 days before slaughter.

• Requiring packers to buy at least 25% of the animals slaughtered on the open market.

18. COOPERATIVE STRUCTURES

We support:

• The timely distribution of benefits to patrons based on their participation in the cooperative business.

• One-member-one-vote in cooperatives including National Milk Producers Federation with membership based on member numbers not on pounds of milk produced.

We oppose:

• Modification of any state laws that eliminate requirements and definitions that establish the
essential cooperative characteristics of ownership, financing, and control by member/patron users.

19. LAND USE/RIGHT TO FARM

Urban sprawl and green energy initiatives such as solar and wind farms continue to threaten the
nation’s farm and ranch land. The amount of land lost to development and the quality of farmland being converted are significant concerns. For land protection to continue, we urge states to develop programs to keep agricultural lands protected from development and in private ownership.

Farms that have not violated any regulation are coming under attack and must defend themselves, which raises the cost of farming. We encourage States’ Attorney General to defend Right to Farm Laws, by intervening to have these cases dismissed or defending them.

20. GUEST WORKER/IMMIGRATION

We believe agriculture in rural America has a need for a stable and legal supply of workers to sustain and grow production and processing.

We support comprehensive federal immigration reform that includes securing our borders and making sure immigrant workers have an easier way to obtain a legal work visa.

21. MILK SECURITY

Maintaining the security of operations from cow to consumer is essential to ensuring the safety
of the nation’s milk supply. Deliberate contamination of the milk supply and processed dairy products could prove injurious to the public health, disrupt dairy markets, and irrevocably
diminish consumer confidence in dairy products.

We support:

• Industry-led, on-farm security initiatives for the production of milk

• Tanker security measures for milk loading and transport

• Proactive measures for maintaining and enhancing security of processed milk products

• Enhanced border security and inspection to protect the domestic dairy industry

22. MILK QUALITY

We believe it is in the best interest of consumers and the dairy industry to maintain the highest level of health and safety standards for milk and dairy products.

23. DRONES

We support:

• Drones being registered, licensed, and regulated for safety and privacy.

• Requiring the operator of a drone to receive consent from the land operator to operate in corresponding airspace.

• Data generated on-farm remaining as the sole property of the operator/farmer with the data only to be used by others if a consent form has been signed by the operator/farmer.

24. STATE & LOCAL POLICY

We oppose the implementation of local and statewide ballot initiatives to create new laws.