Loophole robs Pa. dairy farmers of tax on milk

To the Times: Pennsylvania milk drinkers, did you know that 16 cents of every gallon of milk you purchase is collected to fund an “over-order premium?” The money (nearly $2.5 million per month) collected by this premium is intended to benefit the local economy, and to be paid directly to Pennsylvania dairy producers whose milk is produced, processed, and sold within the state.

However, many Pennsylvania dairy farmers are questioning whether they are actually receiving these dollars you are paying. Some regional and national milk marketing cooperatives have found a loophole, in which they can consider themselves the “producer” and utilize the premium to fund their own marketing operations according to their own policies and agendas. They may claim the money is paid to dairy farmers, but refuse to offer specific accounting on farmer pay stubs to back up this claim.

Thankfully, state Rep. John Lawrence has introduced a bill, HB 1265, that redefines the intended recipients of this premium as the actual cow-milking Pennsylvania “dairy farmer,” and bring transparency by very simply asking that all dairy farmers receive a line-item on their milk payment checks stating how much of their payment is attributable to this premium. An informational meeting on this bill was held by the House Agriculture and Rural Affairs Committee on June 17. Farmers’ concerns were confirmed when a co-op representative revealed that they pool premium dollars and use them to fund their own “milk quantity premiums” for large-scale, out-ofstate dairy operations.

Corporate management of these large cooperatives oppose HB 1265, and have recently hired the most expensive lobbying firm in Harrisburg to convince legislators to keep the status quo. This use of co-op member dollars is reprehensible.

Whether or not you care about local food and economies, and whether or not you support the “over-order premium,” the accountability that HB 1265 would bring to the distribution of money that has been paid by Pennsylvania consumers is a good idea. While the premium helps to support local, land-based dairy production instead of non-sustainable centralized models utilizing long-distance transportation, HB 1265 itself does not increase any costs to consumers nor seek to ensure the continuation of the premium. This is not a partisan issue. This bill was introduced by Republicans, but the advocacy HB 1265 brings to consumers and farmers by requiring transparency from the corporate management of cooperatives is an idea Democrats should be able to support as well.

Let’s make sure the bullies don’t steal your milk money. Please contact your state legislators and ask them to vote “yes” on HB 1265.

Pennsylvania milk drinkers, did you know that 16 cents of every gallon of milk you purchase is collected to fund an “over-order premium?” The money (nearly $2.5 million per month) collected by this premium is intended to benefit the local economy, and to be paid directly to Pennsylvania dairy producers whose milk is produced, processed, and sold within the state. However, many Pennsylvania dairy farmers are questioning whether they are actually receiving these dollars you are paying.