These definitions apply to all rules adopted under authority of Title 80, chapter 11, part 6, MCA.

(1) "Department" means the Montana Department of Agriculture.

(2) "Director" means the director of the Montana Department of Agriculture or a designee.

(3) "Handling operation" means any operation or portion of an operation (except final retailers of agricultural products that do not process agricultural products) that receives or otherwise acquires agricultural products and processes, packages, or stores such products.

(4) "Mediation" means a voluntary, informal process to assist the department and another party to arrive at a mutually acceptable settlement. No formal record is made.

(5) "Mixed operation" means organic and nonorganic production on the same production operation.

(6) "Packaging" means changing the size, shape, type, or method of a product's containment without any change in the product itself.

(7) "Production operation" means a farm, ranch, or other business that grows, gathers, or raises crops, wild crops or livestock.

(1) The department adopts and incorporates by reference the following parts of the United States Department of Agriculture (USDA) National Organic Program (NOP) final rule, Title 7, Part 205, Code of Federal Regulations (CFR) adopted December 21, 2000. Future editions will be specifically adopted as they become applicable.

(a) Subpart A - Definitions, all sections;

(b) Subpart B - Applicability, all sections;

(c) Subpart C - Organic Production and Handling Requirements, all sections;

(d) Subpart D - Labels, Labeling, and Market Information, all sections;

(e) Subpart E - Certification, all sections; and

(f) Subpart G - Administrative:

(i) Sections 205.600 through 205.607;

(ii) Sections 205.640 through 205.642;

(iii) Sections 205.660 through 205.663;

(iv) Sections 205.670 through 205.672; and

(v) Sections 205.680 through 205.681.

(2) The department adopts and incorporates by reference the European Council Regulation (EC) Number 834/2007, as adopted June 28, 2007. Future editions will be specifically adopted as they become applicable.

(a) A copy of these regulations may be obtained from the Montana Department of Agriculture, 303 N. Roberts, P.O. Box 200201, Helena, MT 59620-0201.

(3) Regulations adopted by reference are effective as Montana law. A copy of these regulations may be obtained from the Montana Department of Agriculture, 303 N. Roberts, P.O. Box 200201, Helena, MT 59620-0201.

(4) References in the adopted federal regulations to "certifying agent" may be taken to mean the department as used in this rule.

(1) The director of the Department of Agriculture, who by statute is a member of the Organic Commodity Advisory Council, will appoint seven other members as follows:

(a) one consumer from the public at large;

(b) four certified organic producers;

(c) one certified organic handler representative, who must be an owner or employee of a certified organic handler; and

(d) one certified organic producer or handler representative appointed at large at the discretion of the director of the department.

(2) The director will give preference to nominations from the Organic Commodity Advisory Council, certified organic producers, certified organic handlers, organic food retailers, and organic (product) consumers.

(3) The director will consider the following criteria in the selection of producer members of the advisory council:

(a) experience in certified organic production and/or handling;

(b) represent Montana's diversity of types of organic production;

(c) represent Montana's diversity of sizes of organic operations; and

(d) represent Montana geographically.

(4) Appointed members will serve three-year staggered terms. Appointed members shall not serve more than three consecutive terms.

(5) Compensation of council members will be as provided by 2-15-122, MCA.

(6) The council will conduct annual reviews of certification program activities. This will include a yearly review of a sampling of certification decisions.

(7) The council shall conduct meetings and carry out duties in accordance with procedures in 2-15-122, MCA, and any other procedures recommended by the council and approved by the department.

 

(1) Producers and handlers certified by the department may use a seal that identifies the department as the certifying agent, provided that such seal is used in compliance with 7 CFR 205 subpart D. The use of such a seal is voluntary.

(2) The department's organic seal may be reproduced in black and white and must replicate the form and design of the example in figure 1.

(3) The department's organic seal may be reproduced in color and must replicate the form and design of the example in figure 1.

(a) If reproduced in color, the seal must be colored according to specifications approved by the department.

(b) A representation of the colored organic seal is available for viewing and download from the department web site.

(4) The department's organic seal may be reproduced as a black and transparent image and must replicate the form and design of the example in figure 1.

(5) Instructions for reproducing the seal in color, black and white, or black and transparent are available from the department upon request.

(6) Seals may be affixed only to products organically produced or handled by operations certified organic by the department.

(7) Seals must be printed legibly and conspicuously.

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Figure 1:

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(1) The department will certify production and handling operations that submit an application to the department and comply with the requirements set forth in these rules.

(2) The department may certify contract production or handling of organic products for producers or handlers certified by the department:

(a) The contract production or handling must be described in the production or handling system plan of an operation certified by the department or applying for certification by the department;

(b) Contract producers or handlers will not be certified themselves, but will be included as part of the contracting producer or handler's certification;

(c) The department may review contracts for production or handling to assure that the certified operation or the operation applying for certification has sufficient control over the contracted production or handling to effect change in cases of noncompliance; and

(d) Any notices of noncompliance, denial of certification, or suspension or revocation of certification involving contract production or handling will be issued to the certified operation or operation applying for certification. No separate proceeding will occur with the contractor.

(3) Each production or handling operation required by 7 CFR 205.100 to be certified, except for those exempt or excluded by 7 CFR 205.101, must apply for certification and must be certified by the department or another accredited certifier:

(a) An operation that meets the definition of "production operation" must be certified as a producer; and

(b) A certified producer who changes crops, wild crops, and/or livestock of their own production into a new distinct product by physically, chemically, or otherwise changing the original product, must also certify as a handler.

(i) However, a certified producer may clean, wash, grade, dry, package, transport, or do similar preparation of their own production without handler certification; and

(ii) All such activities by certified producers must be fully described in their Organic System Plan (OSP). The department may require additional information or documentation from certified producers regarding their contracted handling activities.

(c) An operation that meets the definition of "handling operation" must be certified as a handler.

(4) Once granted, certification continues in effect until surrendered by the certified operation or suspended or revoked by the department. However, to continue certification, certified operations must annually submit an application, pay certification fees, allow an on site inspection, and submit information in compliance with 7 CFR 205.406.

(5) Applications must be submitted on forms approved by the department and must be completed, signed, and accompanied by the appropriate fees in order to be considered. Application forms can be found on the department’s web site and will be accepted electronically. Forms are also available on request from the department.

(6) First time applicants must include a complete OSP with their application. Certified operations may use a renewal form to update their OSP annually for up to three years, but must submit a new complete OSP at least every four years and may be required by the department to submit a new complete OSP whenever there are significant changes to the operation.

(7) Applications for certification may include labels for all crop, livestock and handling inputs, and processing aids and evidence that each input and processing aid contains only allowed substances. Such evidence may consist of lists of ingredients, statements from manufacturers, or verification of recognized third party review.

(8) Applications for certification must include, as part of their OSP, a list of all organic products produced and/or handled, including sample labels and complete product profiles for each distinctly labeled organic product:

(a) Certified operations must not use an organic label or make organic claims for any product not included in their OSP;

(b) Certified operations may add new products by submitting an addendum to their OSP, including sample labels and complete product profiles where applicable;

(c) Product profiles must be submitted on forms approved by the department and must include a complete list of ingredients in the product and processing aids used in manufacturing the product; and

(d) Information provided to the department on product profiles and sample labels will only be used to evaluate an applicant's compliance with organic program rules. Such information will be treated as confidential.

(9) Applications to continue producer certification are due no later than March 15 annually.

(10) Applications to continue handler certification are due no later than September 15 annually.

(11) Certified operations that do not apply to continue certification or do not comply annually with 7 CFR 205.406 may have their certification suspended. An operation that has its certification suspended may reapply, but would not qualify for the new applicant discount.

(12) An application for certification may be withdrawn by the applicant at any time:

(a) to withdraw an application for certification, applicants must submit a written request to withdraw, including the applicant's name, address, and signature; and

(b) upon receipt of a request to withdraw an application for certification, the department will suspend all actions related to the application and bill the applicant for all fees due for services rendered up to the time of the department's receipt of the withdrawal request.

(1) Application fees for producers are as follows:

(a) a new applicant will receive a $100 credit to be applied to the first-year fees;

(b) the application fee for an operation with gross annual organic sales from $0 to $20,000.99 is $600;

(c) the application fee for an operation with gross annual organic sales from $20,001 to $40,000.99 is $700;

(d) the application fee for an operation with gross annual organic sales from $40,001 to $100,000.99 is $800;

(e) the application fee for an operation with gross annual organic sales from $100,001 to $250,000.99 is $900;

(f) the application fee for an operation with gross annual organic sales from $250,001 to $500,000.99 is $1,000;

(g) the application fee for an operation with gross annual organic sales from $500,001 to $1,000,000.99 is $1,250;

(h) the application fee for an operation with gross annual organic sales at or above $1,000,001 is $1,500; and

(i) an additional fee is $100 for combined livestock and crop operations.

(2) Application fees for handlers are as follows:

(a) a new applicant will receive a $100 credit to be applied to the first-year fees;

(b) the application fee for an operation with gross annual organic sales from $0 to $20,000.99 is $600;

(c) the application fee for an operation with gross annual organic sales from $20,001 to $40,000.99 is $700;

(d) the application fee for an operation with gross annual organic sales from $40,001 to $100,000.99 is $800;

(e) the application fee for an operation with gross annual organic sales from $100,001 to $250,000.99 is $900;

(f) the application fee for an operation with gross annual organic sales from $250,001 to $500,000.99 is $1,000;

(g) the application fee for an operation with gross annual organic sales from $500,001 to $1,000,000.99 is $1,250;

(h) the application fee for an operation with gross annual organic sales at or above $1,000,001 is $1,500; and

(i) if an operation is certified as a producer, or is applying for certification as a producer, the operation may subtract $115 from the base application fee for handler certification.

(3) Each applicant for certification will be inspected initially and yearly thereafter, in compliance with 7 CFR 205.403, to assess compliance with certification standards. Fees will be charged to the applicant in amounts sufficient to cover costs of the inspection.

(a) The inspection charge will be $35 to $75 per hour for time incurred in the inspection and writing the report. The exact hourly rate will be set each year based on actual cost to the department. The department will also charge per diem and mileage at standard state rates, plus a 10% administrative charge.

(4) The label and product profile review fee is $35 for each new or revised label.

(5) Failure to pay application, inspection, or other fees due within the required time will be cause for denying, suspending, or revoking certification.

(6) All application fees and fees for services are nonrefundable upon receipt.

(7) Applications submitted after the deadline must include an additional late fee of $200. On the first of every month after the first month, an additional $100 will be added to the late fee.

(8) Inspection fees are payable upon receipt of a billing statement. The department may assess a collection fee of 18% annual percentage rate or assess a minimum fee of $25, whichever is greater, for any payment amount not received on or before the last regular business day of each month. The department may require past due payment of fees prior to providing certification services.

(9) A surcharge of up to $1,000 may be charged for expedited services depending on the speed, time of the year, and resources required. The department may set pricing standards within department policy.

(1) Producers and handlers certified by the department, and new applicants for certification, must submit an annual report of their total gross sales and handling charges for all certified organic production and handling. Certified producers and new applicants for producer certification shall pay an annual assessment fee to the department as a percentage of gross sales of organically produced products. Certified handlers and new applicants for handler certification shall pay an annual assessment fee as a percentage of gross sales and handling charges for all products and services included in their Organic Handling System Plans (OHSP):

(a) the annual report and assessment for producers and handlers of all gross sales and handling charges shall be for the previous calendar year;

(b) the report and fees for producers are due on March 15 annually. The report and fees for handlers are due on September 15 annually. The department may assess a 10% penalty or a minimum fee of $25, whichever is greater, for any assessment reports received after the deadline. The department may require past due payment of fees prior to providing certification services.

(2) The assessment fee for producers is 0.5% of sales except that the minimum producer assessment is $150 and the maximum producer assessment is $3,000.

(3) The assessment fee for handlers is 0.5% of sales except that the minimum handler assessment is $150 and the maximum handler assessment is $5,000.

(4) All assessment fees are nonrefundable upon receipt.

(5) Any fees paid or owed in excess of the rule caps stated in ARM 4.17.106 for the year 2015 will be refunded to the producer, or if still owing will be considered void.

 

(1) The department may certify operations that are exempted or excluded from certification pursuant to 7 CFR 205.101. Such certification is voluntary.

(2) Application procedures, fees, and certification standards will be as provided for nonexempt and nonexcluded operations.

(1) Producers and handlers converting to organic production that do not qualify for certification may apply for an application review or full review including an inspection. These reviews allow potential applicants to experience procedures and requirements of the certification program and to identify areas of potential noncompliance.

(2) Applicants for conversion period application review must prepay one-half of the applicable application fee and submit appropriate application forms. The department will review the application and no inspection will be conducted. The department will notify the applicant of any deficiencies in the application or the organic system plan.

(3) Applicants for conversion period full review must prepay the full amount of the applicable application fee and submit the appropriate application forms. An inspection will be scheduled and conducted. The department will notify the applicant of any deficiencies in the application or the organic system plan and any deficiencies determined as a result of the inspection.

(4) A conversion period full review including an inspection in the year prior to certification exempts the operation from payment of a new application fee in the first year of certification.

(5) The new application fee does not apply to conversion period reviews.

(6) Persons who participate in the conversion program shall not imply in any manner that they are organically certified, and must not sell, label, or represent products as "100 percent organic," "organic," or "made with organic ingredients."

(1) Transaction documentation forms (TDF) may be used in transactions of certified organic products to identify products that were produced or handled in accordance with rules adopted under this chapter. TDF provided by the department can be used only by operations certified by the department and only for products covered by department certification. Use of TDF is voluntary and two types are available:

(a) transaction documentation forms may be issued as sequentially numbered forms with the producer's or handler's identification and expiration date beyond which use is not valid. Users shall enter shipment information that must include product name, production date, quantity sold, lot number (if applicable), sale price, and date of sale; and

(b) the department shall issue a completed TDF to a producer and/or handler upon written request. Requests must include payment, must be submitted on forms approved by the department and must contain all information requested on the request form including product name, production date, quantity sold, lot number (if applicable), sale price, date of sale, and name and address of buyer.

(2) When a TDF is part of a sale, the sales record required by ARM 4.17.111 for certified operations shall include the TDF number.

(3) Unused, expired TDF shall be returned to the department, or they may be collected by an inspector.

(1) Certified operations must maintain records and make such records available to the department as set forth in 7 CFR 205.103. Records shall be sufficient to facilitate an audit trail to track the identity and movement of certified organic products. Such records must be adapted to the particular business that the certified operation is conducting.

(2) Certified operations must have records of all nonorganic production and handling. Such records must be sufficient to clearly document that there is no commingling of organic and nonorganic products, that there is no contamination of organic products with prohibited materials used in production or handling of nonorganic products, and that no nonorganic products are sold or represented as organic.

(3) Certified organic producers, except producers of livestock, shall keep the following records for each crop produced:

(a) location where grown;

(b) storage location;

(c) materials applied to plants, soil, water, and products. These records shall include date applied, application rate, and name of material including brand name for brand name products;

(d) if custom processed, handling and processing description, date, and location. Location shall include the name and address of the handler or processor;

(e) sales records of organic crops by dollar and product volume, name and address of purchaser where possible, and transaction documentation form number when used; and

(f) identifying lot number that facilitates tracking the product from field to sale or release of physical control, if appropriate to the type of operation.

(4) Certified organic livestock producers shall keep the following records:

(a) all livestock must be individually identified or marked except poultry, bees, and fish, which may be identified by unit of production, such as flock, hive, or pond;

(b) receipts for acquired stock and materials must be kept to insure a complete audit trail; and

(c) the following records from birth or purchase to sale or release of physical control:

(i) all disease and pest management materials administered including dates administered, material identification, dosages, and sources;

(ii) all purchased feeds including dates purchased, feed identification, quantities purchased, sources, and documentation of organic certification;

(iii) weight of slaughter animals at slaughter and weight of postslaughter animal products;

(iv) slaughter, packing and other handling description, date, and location. Location shall include the name and address of the slaughterer, packing plant, or other handler; and

(v) sales records of all organic animal products sold including dates, quantities, or weights. Sales records must include the purchaser's name and address where possible and transaction documentation form number when used.

(5) Certified handlers must maintain records that track ingredients and certified organic products from receiving through distribution, shipping, or sale. Such records include, as appropriate to the enterprise:

(a) invoices, bills of lading, and producer certificates for incoming products;

(b) date and quantity of product processed or handled;

(c) storage identification and location of incoming product and of processed or handled product;

(d) repack data, production run reports, invoices, and bills of lading of products shipped out; and

(e) handlers must have available copies of organic certificates or other documentation of organic status for all organic ingredients and products. Organic certificates must be current and correspond to the organic ingredients used in processing. All organic certificates must be from USDA-accredited certification agencies.

(1) The department or contract inspectors will collect samples of soil, products, or agricultural inputs from randomly or systematically selected operations certified by the department. The department will collect samples when there is reason to believe, based on observation or information received, that land, an input, or product came into contact with a prohibited substance or that excluded methods were used. Inspectors may collect samples as part of the routine annual organic inspection or recommend sampling by the department.

(2) All certified operations are subject to 7 CFR 205.670, which specifies that the department or the Agricultural Marketing Service (AMS) administrator may require preharvest or postharvest testing of any agricultural input used or agricultural product to be sold, labeled, or represented as organic.

(3) The department will analyze samples for prohibited substances or for evidence of use of excluded methods. Pesticide and fertilizer analyses will be conducted whenever possible by the Montana Department of Agriculture Analytical Laboratory.

(4) Sampling and analyses will be at the expense of the department provided that revenues from application fees and assessments may be used to fund the sampling program. Inspectors will not be charged for samples taken as part of an organic inspection or investigation.

(5) All results of analyses will be provided to the administrator, AMS, United States Department of Agriculture; the certified operation or applicant; and the public on request. The department may publish a yearly summary of sample results.

(6) Applicants for certification and certified operations will be provided with a receipt for any samples collected by the department or contract inspectors.

(1) Any person with knowledge of a violation of this chapter may file a complaint with the department. Complaints should be in writing and signed and should provide the details known to the person filing the complaint. The lack of a written or signed complaint will not preclude the department from investigating.

(2) The department will evaluate each complaint and will investigate complaints involving operations certified by the department. Complaints involving operations not certified by the department will be referred to the manager of the National Organic Program.

(3) The department may investigate certified or noncertified organic operations, whether certified by the department or not, upon determining that a need exists to protect public health and safety or preserve evidence that would justify an immediate investigation.

(1) The department may initiate a compliance action against an applicant for certification or a producer or handler certified by the department that is not in compliance with these rules:

(a) the department and applicants for certification will follow procedures established in 7 CFR 205, subpart (e) in addressing noncompliance issues under National Organic Program standards;

(b) the department and certified operations will follow procedures established in 7 CFR 205, subpart (g) in addressing noncompliance issues under National Organic Program standards;

(c) the department's procedure for denying certification under National Organic Program standards will adhere to that established in 7 CFR 205, subpart (e); and

(d) any notice of denial of certification or proposed suspension or revocation of certification will state the person's right to mediation. The department's mediation procedures will be consistent with that established in 7 CFR 205.663 and the department may incorporate procedures for mediation established by state statutes.

(2) Where there is reason to believe that an operation certified by the department is selling, representing, or labeling as organic any products that have been exposed to or contain prohibited substances or have been produced using prohibited substances or excluded methods, the department may place a stop sale tag on such products prohibiting further sale or movement. Any person who removes or disposes of such detained product by sale or otherwise, without prior permission, or removes or alters the tag, is in violation and may be subject to civil penalties. The department may authorize removal of the tag when this chapter has been complied with. If compliance is not achieved within 30 days, or upon the request of the person holding the product, the department may begin proceedings for condemnation.

(3) When the department finds that a producer or handler has committed a violation of these rules, the department may assess a civil penalty sufficient to recover all costs of the investigation leading to the finding of violation. Such costs shall include those associated with sampling of soil, production inputs, or products for residues of prohibited materials or products of excluded methods. Penalties issued to recover costs of investigation shall be in addition to civil penalties issued in response to violations, as described in this rule.

(4) The director may assess a civil penalty not exceeding $10,000 per violation when the department concludes that a producer or handler committed a violation. The department in selecting an appropriate penalty amount shall consider the severity of the violation and other gravity factors such as negligence and willfulness.

(5) A civil penalty may not be assessed until the person charged is given notice of opportunity for a hearing and an appeal pursuant to the Montana Administrative Procedure Act.

(6) This rule does not require the department to revoke or suspend certification, issue stop sale orders, or assess civil penalties when other remedies such as a written notice or warning are sufficient to cure a violation.

(1) Any dispute with respect to denial of certification or proposed suspension or revocation of certification may be mediated at the request of the applicant for certification or certified operation as provided by 7 CFR 205.663. Procedures and time frames for mediation will be consistent with those established in 7 CFR 205.663 and standards for mediation established in 26-1-813 , MCA.

(2) Mediators must be impartial and knowledgeable about organic certification standards. A mediator shall be chosen by mutual consent. If a mediator cannot be chosen by mutual consent, the department shall select a mediator.

(3) Matters raised in mediation are privileged, private, and confidential, except that a mediated agreement may be disclosed to the secretary of the United States Department of Agriculture.

(4) Persons can represent themselves or be represented by an attorney. It is understood that any person appearing on behalf of the person that requested mediation will have full settlement authority for the person they are representing. The mediator has discretion in establishing formal or informal mediation procedures. Where persons choose not to be represented by counsel, the mediator may choose to use informal procedures. However, mediators have the option to provide structure to the mediation and to apply rules of evidence and civil procedure.

(5) If mediation produces a settlement agreement, a written agreement will be prepared with the assistance of the mediator, if necessary. The person who requested mediation, the department's representative, and the mediator shall sign the settlement and provide it to the director. The director shall determine if the settlement is accepted by the department.

(6) The parties shall share equally the cost for the services of a mediator.