Commission Members in Attendance:

Connecticut: Shirley Ferris, Richard Allen, Bob Jacquier, and Mae Schmidle

Massachusetts: Bill Gillmeister (designee for Jay Healy), Gordie Cook, and Mary K. Kassler

Maine: Tom Doak, Mike Wiers and Fred Hardy

New Hampshire: Doug Morris and Powell Cabot

Rhode Island: John Smith and Aaron Briggs

Vermont: Harold Howrigan, Bobby Starr, Jacques Couture, Millicent Rooney and Andy Dykstra

Commission Staff Present:

Ken Becker, Executive Director; Dixie Henry, General Counsel; Carmen Ross, Regulations Administrator; Becky Holden, Office Manager; Denise Little, Administrative Assistant; and Tina Wisell, Public Information Director

The meeting was called to order by Chair Mike Wiers at 2:05 p.m.

Public Participation:

Carl Peterson said that Nancy Adsit from New York Assemblyman Clifford Crouch's office had reported that the NY Legislature would be in session the following week. Negotiations are underway concerning several issues. The prospects for a vote on Compact legislation look good. Mr. Peterson paid tribute to out-going Compact Chair Mike Wiers and everyone who played a role in advancing the Compact legislation in New York. He said the Northeast Dairy Compact is leading the country as a model for a new way of pricing milk.

Introduction and Guests:

No members of the public chose to introduce themselves.

Consideration and Approval of Minutes:

Andy Dykstra made a motion to accept the minutes of the November 18, 1998 regular session Commission meeting as presented. Motion was seconded by Fred Hardy, passed by unanimous vote of the six State delegations.

Consideration of Communications:

There were no communications to report.

Financial and Budget Report:

Mae Schmidle and Dixie Henry recused themselves from the discussion. Powell Cabot said the Commission currently has a positive cash balance. He noted that the expenses exceeded the income received during the month of October. Mr. Cabot said the Commission had previously decided to pay its bank loans on a monthly basis, however, after discussions with those banks, a payment resolution was drafted which sets up a new payment timetable.

Referring to the Balance Sheet-Administrative Fund for October 31, 1998, Income and Expenditures for October 1998 and Income and Expenditures Year to Date financial statements (Attachment I) Mr. Becker said the Commission did have sufficient funds on hand to continue its operations. Concerning year to date financials, Mr. Becker said banks had credited the Commission for $3,500 of the approximately $5,300 in services charges they had previously billed the Commission. He said the Commission to date has spent approximately $194,000 on outside services while it had budgeted $272,000. The Commission is under budget at this time for a variety of factors. The university studies have not yet been completed, therefore, the universities have not been paid in full for their services. The Market Administrator's costs have been under-budget to this point. However, Mr. Becker indicated that those costs would increase shortly due to the fact that the Market Administrator's Office would soon be performing a good deal of work for the Commission in verifying information on CCC reimbursement forms.

Mr. Becker put together a proposed budget for 1999 that includes a new repayment plan

concerning payment of bank loans to the National Bank of Middlebury and the Peoples Trust Company. He said the Commission had voted earlier this year to pay down a certain amount of its loans to various banks. However, because certain handlers have since filed a petition for exemption concerning the payment of the administrative assessment, the Committee on Administration felt it was not prudent to continue with that payment schedule. As a result, two resolutions were drafted which spell out the details of a new repayment plan with each bank (Attachment II is the resolution concerning the National Bank of Middlebury. Attachment III is the resolution concerning the Peoples Trust Company.) The banks have already approved the resolutions. Mr. Becker explained the repayment plans and said both loans should be paid in full by September 30, 1999.

Harold Howrigan made a motion to adopt the resolutions as presented by Mr. Becker regarding repayment to the National Bank of Middlebury and Peoples Trust Company for bank loans to the Commission. Motion was seconded by Gordie Cook. Mr. Becker said he believed the Commission would have the funds needed to repay the loans. The issue may have to be revisited depending upon the outcome of the handlers exemption petition concerning the administrative assessment and/or the outcome of the subjects and issues rulemaking. Andy Dykstra asked how much of the administrative assessment was received by the Commission during the past month. Mr. Becker said the Commission received $21,200 and was scheduled to receive $86,000. The motion passed by unanimous vote of the six State delegations.

Mr. Becker gave a summary of the proposed budget he had prepared for 1999 with attached notes (Attachment IV).

Mike Wiers said the Committee on Administration is recommending the adoption of the proposed budget. The Committee feels the budget is reasonable and the salary increases contained in it are appropriate. Harold Howrigan made a motion to adopt the proposed 1999 budget as presented. Bob Jacquier seconded the motion.

Shirley Ferris asked about the status of the Cost of Production Study. Mr. Becker said the University of Massachusetts has completed much of the study and has been paid for most of the work. The University of Vermont is conducting the Market Impact Study. The Commission has paid for approximately half of the costs of that study.

Shirley Ferris suggested that the Commission make a promotional video about the Compact. Andy Dykstra asked if the Commission had received a final report on the Cost of Production Study yet. Mr. Becker said the Commission had not yet received a report but would soon. The motion passed by unanimous vote of the six State delegations. Dixie Henry and Mae Schmidle returned to the meeting.



The Chair did not give a report.

Executive Director:

Ken Becker said the New York State Dairy Foods case has been appealed.

The Commission staff is very close to completing a personnel manual. It will be reviewed by the Committee on Administration and presented to the Commission at the next Commission meeting in January.

The lease for the new Commission office space has been signed. The Commission received three bids from movers and accepted the lowest bid. The cost will be approximately $600.

The Commission contracted with Computerland to determine whether the office computer system was year 2000 compliant. The Commission received a report back stating that the office was in compliance.

Concerning the pool of November milk paid in December, Mr. Becker said there were 248 million pounds of Class I milk and 527 million pounds of total producer milk. The Compact Class I utilization rate was 47%. Because of the high Class I market prices, there was no Compact over-order obligation this month. The Order I, Zone I, Class I price for December is $19.28. It will be $20.08 for January.

The deadline date for CCC refund applications to be returned to the Commission office was December 11, 1998. The Commission office mailed out 4,080 application forms with the producer referendum on the diversions and transfers rulemaking. The Commission received back 939 applications, approximately 23% of the total sent out. The applicants' names and addresses and the producer pounds will be entered into a database at the Commission office. The Market Administrator's office will be working with the Commission to verify the accuracy of the data on those forms. Due to the time commitment involved, its expected that checks will be distributed to producers in February or March.


Information was discussed earlier under Financial Report.

Committee on Administration:

Mike Wiers said the Committee is recommending that the Commission approve payment of the Federal Milk Market Invoice of $9,725.04 for October audits, September pool and referendum (Attachment V) and payment of the invoice from Wiley, Rein and Fielding for $6,346.30 for Professional and Legal Services Rendered Through October 31, 1998 (Attachment VI).

Nominations Committee:

Shirley Ferris said the Committee had revised the panel of recommended officers to include the following:

Mae Schmidle, (CT) Chairman; Ron Newman, (RI) Vice-Chair; Powell Cabot, (NH) Secretary; Mary K. Kassler, (MA) Treasurer; Fred Hardy, (ME) Member at Large; and Harold Howrigan, (VT) Member at Large. This would place three consumer representatives in executive positions and one processor in an executive position. It would also place two farmers on the board.

Audit Committee:

Tom Doak said the Commission does not yet have the 1997 Audit Report but it will be available soon. A good portion of the information from the 1997 Audit will be useful for the 1998 Audit. Mr. Doak said the Committee should have the audit within a few days to review and should have a recommendation for the full Commission at the January meeting. The Committee is expecting to be able to do the 1998 report early in 1999.

Bylaws Committee:

The Committee had nothing to report.

Committee on Regulations and Rulemaking:

Bobby Starr said the Commission has concluded the hearing process on the Subjects and Issues Rulemaking. The public comment period will close on December 31, 1998.

Unfinished Business:

Executive Session:

Jacques Couture made a motion to enter into Executive Session to consider personnel issues. The motion was seconded by Richard Allen, passed by unanimous vote of the six State delegations. Mae Schmidle recused herself from the discussion.

The Commission reconvened the Regular Session. Jacques Couture made a motion to pay Dan Smith for unused vacation and holiday pay in the amount of $6,369.16, plus applicable SEP contribution, and to reduce compensation for insurance stipend from $2,133 to $800. The motion was seconded by Aaron Briggs, passed by unanimous consent of the six State delegations.

New Business:

Committee on Administration's Recommendations:

Dixie Henry recused herself from the discussion. Mike Wiers restated the Committee's recommendation to pay the Market Administrator's Invoice and the invoice from Wiley, Rein and Fielding. Bobby Starr made a motion to approve payment of the Market Administrator's invoice of $9,725.04 for the September 1998 pool and completed audits. Motion was seconded by Gordie Cook. Mr. Cook asked whether there was a need for audits during the months when there is no pool. Mr. Becker said the audits still need to be done during those months to determine such things as qualified producers and verified volumes of milk. Mr. Becker said the amount of work that needs to be done for the audits is virtually the same whether there is a Compact over-order obligation or not. There is still a pool because the Commission still needs to take handler reports, determine how much Class I milk was sold and how much total milk was purchased from farmers in order to determine producer qualification and eligibility. The motion passed by unanimous vote of the six State delegations.

Mike Wiers said the Commission received an invoice of $6,346.30 from Wiley, Rein and Fielding for work performed on the handlers' petition case. Mr. Becker said the total bill from the law firm to date is approximately $34,000. The balance would be paid in early 1999. Mr. Becker said settlement negotiations concerning the case are underway so there would be additional charges from the law firm. Bobby Starr made a motion to approve payment of the Wiley, Rein and Fielding invoice of $6,346.30 for professional services rendered through October 31, 1998. The motion was seconded by Fred Hardy, passed by unanimous vote of the six State delegations. Mae Schmidle and Dixie Henry returned to the meeting.

Election of Officers:

A motion was made by the Committee on Nominations to adopt the following slate of officers to serve during the 1999 calendar year:

Chair Mae Schmidle, Connecticut

Vice Chair Ron Newman, Rhode Island

Secretary Powell Cabot, New Hampshire

Treasurer Mary K. Kassler, Massachusetts

Member Fred Hardy, Maine

Member Harold Howrigan, Vermont

Mike Wiers said the Bylaws also provide that nominations can be made from the floor. No other nominations were made. Motion passed by unanimous vote of the six State delegations.

Mae Schmidle made a motion that the Commission express its grateful appreciation to Chairman Michael Wiers for all the time, effort and heart that he has put into the successful launching and the ongoing leadership of the Northeast Dairy Compact. Motion seconded by Harold Howrigan who added to the motion that the Northeast Dairy Compact has been successful beyond anyone's expectations thanks in good share to Chairman Wiers. Motion passed by unanimous vote of the six State delegations.

Andy Dykstra requested that the Commission return to its regular schedule of holding Commission meetings on the first Wednesday of every month. Mr. Wiers said the next two Commission meetings would be held on January 13, 1999 and February 17, 1999. There was some discussion concerning possibly skipping the January meeting. However, Mr. Wiers noted that there were some critical issues that needed to be addressed quickly, including the administrative assessment. He said the Commission could likely get back on schedule following the February meeting.

Mr. Wiers thanked the Commission for all the words of support. He said it was a pleasure to work with the Commission for the past two and a half years.

The meeting adjourned at 3:40pm.

Respectfully submitted,

Tina Wisell

Public Information Director

The next Commission meeting will be held at 10:00 am on Wednesday, January 13, 1999 at the Museum of New Hampshire History, 6 Eagle Square, Concord, New Hampshire.

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