HAR §4-60-15. Readjustment of quotas

(a) Quotas established pursuant to sections 4-60-13 and 4-60-14 may be forfeited by the producer or producer- distributor if the producer fails to produce and deliver milk in accordance with the following: (1) A producer or producer-distributor shall produce and deliver not less than ninety per cent of the producer or producer-distributor’s quota by the end of the ninety-day period immediately following the establishment of said quota. If the board increases established quotas because of increase in demand, the producers shall be given a six-month period after the effective date to increase their production and this section shall be suspended for this period; (2) Thereafter, during periods of insufficient milk production in the milk shed, any producer or producer-distributor who fails for two consecutive calendar months, during the period including December through August, to maintain average daily production at a minimum of ninety per cent of the producer or producer- distributor’s established quota may be required by the board to forfeit any portion of quota that the producer or producer- distributor has failed to produce and deliver, unless such lesser production is required by operation of law or in writing by the board as a result of an estimated decrease in market requirements; and (3) For the purpose of this section, a condition of inadequate production in a given calendar month shall be deemed to exist when the total production and delivery of milk acceptable as Grade A use in the milk shed does not exceed the sum of the class I utilization and the class II utilization allowed for plant shrinkage as reported to the branch by the distributors and producer-distributors. (b) Quota forfeited pursuant to subsection (a) (2) may, at the discretion of the board, be retired from the milk shed, held in reserve for future use, or reallocated to other producers and producer-distributors. (1) If reallocated, the forfeited quota shall be distributed to producers and producer-distributors who are producing more than one hundred per cent of their production quota in the calendar month preceding the date of quota forfeiture. Quota shall be distributed in such a way that the production level of each eligible producer and producer-distributor equals one hundred per cent of its newly adjusted quota. If the forfeited quota is insufficient to accomplish this, it shall be distributed proportionally based on the percentage by which each producer’s or producer-distributor’s production exceeds its quota on the forfeiture date. Eligible producers and producer-distributors may refuse additional quota by submitting a written refusal to the branch. (2) All forfeited quota that remains after reallocation shall be held in reserve and reallocated, to producers or producer-distributors who later produce above established quota in the manner described in paragraph (1) or (3). (3) Producers and producer-distributors may request at any time an allocation of quota from the reserve when their production is above ninety per cent of quota or up to and including one hundred per cent of quota for the preceding calendar month and for any nine of the twelve months preceding the quota reallocation request. Before receiving reallocated quota, a producer or producer-distributor in this category shall submit to the board a written commitment to produce its share of the reallocated quota within six months of the reallocation effective date, along with a written plan of action indicating how the quota will be met. Quota shall be allocated in such a way that the recipient’s production level is at or above ninety per cent of its newly adjusted quota. Failure to meet the newly adjusted quota within the six months shall result in forfeiture in accordance with subsection (a). The provision which requires production above ninety per cent of quota or up to and including one hundred per cent of quota for any nine of the twelve months before the quota reallocation date, may be waived for the first six months after the effective date of this subsection. [Eff 7/16/80; am and comp 12/1/85; am and comp 5/1/87; am 1/30/93] (Auth: HRS §157-13) (Imp: HRS §157-34)