Administrative Rules of the State of Montana

BEFORE THE DEPARTMENT OF AGRICULTURE

OF THE STATE OF MONTANA

In the matter of the amendment of ARM 4.12.3104 and the adoption of NEW RULE I pertaining to Seed Rules

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NOTICE OF AMENDMENT AND ADOPTION

TO: All Concerned Persons

1. On November 17, 2023, the Department of Agriculture published MAR Notice No. 4-23-282 pertaining to the public hearing on the proposed amendment and adoption of the above-stated rules at page 1587 of the 2023 Montana Administrative Register, Issue Number 22.

2. The department has amended the following rule as proposed, with the following changes from the original proposal, new matter underlined, deleted matter interlined:

4.12.3104 LABELING FOR SEED KIND AND VARIETY (1) through (1)(a)(xi) remain as proposed.

(xii) soybean; and

~~(xiii) triticale; and~~

(xiv) remains as proposed but is renumbered (xiii).

(b) through (4) remain as proposed.

3. The department has adopted the following rule as proposed, with the following changes from the original proposal, new matter underlined, deleted matter interlined:

NEW RULE I (4.12.3115) GENUINE GROWER DECLARATION FORM

(1) remains as proposed.

(2) What is required in a genuine grower declaration form? The grower declaration must contain:

(a) and (b) remain as proposed.

(3) When is a genuine grower declaration form needed? ~~Before~~ Anytime any seed is cleaned or conditioned on equipment not owned by the farmer, the grower declaration is required. In most circumstances, the form should be signed before the cleaning or conditioning is performed, but a signature occurring before the seeds are returned to the farmer is allowed in cases where it is impractical to get a signature before the services are performed.

(4) through (6) remain as proposed.

(7) How long must a genuine grower declaration form be retained? The completed form must be retained for one year after the seed cleaning or conditioning occurred.

4. The department has thoroughly considered the comments and testimony received. A summary of the comments received, and the department's responses are as follows:

The department received 42 comments from individuals and organizations. The department received eighteen comments in support of the entire rule with eight additional comments in support of one portion of the rule but not the other. The department received twelve comments opposed to the first portion of the rule about variety labeling. The department received four comments opposed to the second part of the rule detailing the required farmer declaration.

Comment 1: Seven commenters disliked the FAQ format of the second portion of the rules. Some of them provided a rewritten version of the rules in the standard format. Three commenters were in favor of the new format.

Response 1: The department understands that change is difficult and that the new format is different. The department believes that the new format helps clearly state when a rule is necessary by stating the question that the law itself does not answer and then providing a clear response. It also avoids the problem of having a separate FAQ that is not in the rule that may go beyond what the law and the rule authorize, by some form of nebulous policy. The department is keeping the new format for now but will monitor the response to it.

Comment 2: Twenty-five commenters pointed out that it is unclear how long a seed cleaner/conditioner must retain the required farmer declaration form or documentation.

Response 2: The department agrees with the commenters. Although the legislature rejected the retention of seed samples, it is unclear how long the legislature intended the seed cleaners to retain the declaration documents. The department changed some of the rule language and punctuation at the recommendation of the commenters. The rule is being amended to require retention of the genuine grower declaration form (or its electronic equivalent) for at least one year after the service is provided to prove compliance with the law. The department would recommend that seed cleaners and conditioners keep it for three years as it is a document that may protect them from some intellectual property lawsuits. An additional question and response consistent with these comments is being amended into the rule.

Comment 3: One commenter requested that in some cases a post-cleaning/conditioning collection of the declaration be allowed to provide maximum flexibility, especially for long-term existing customers.

Response 3: The law requires the disclosure, but does not state that it must be obtained before providing the service. Therefore, a post-cleaning declaration would be appropriate in some cases, but should be done infrequently as it causes the potential for the seed cleaner/conditioner to be out of compliance if they are unable to get the required declaration after providing the service. An additional question and response consistent with this comment is being amended into the rule.

Comment 4: Six commenters pointed out the rules and the law reference a department-provided sample form. Some of these commenters included additional fields that they felt should be required. The commenters also pointed out that there is no sample form on the department webpage.

Response 4: The comments are correct; the required form is not yet on the department's website. The department will post it once the rules have been adopted, so that the form will be consistent with all the requirements of the law and the rules. The department will only provide those fields required by the law and leave other fields and information to be decided upon by the businesses themselves as opposed to regulating their inclusion.

Comment 5: The department received two comments that this was an attempt to make the seed cleaner/conditioner legally responsible for the actions of farmers.

Response 5: The cleaner/conditioner is already responsible under intellectual property laws for providing services that help violate the property rights of another if it is done on purpose or with intentional ignorance. The declaration is to help the cleaner/conditioner prove they did not provide the services in a state of intentional ignorance by in essence operating a "don't ask what you are cleaning" policy or by providing rental equipment with no inquiry at all.

Comment 6: Three commenters felt requiring the declaration would cost them business because farmers would find it to be intrusive into the farmer's privacy.

Response 6: The department believes farmers engaged in the hiring of seed cleaning/conditioners have no reasonable expectation of privacy in the transaction. To grant such privacy by not asking what a licensed state cleaner/conditioner is providing services for is the exact sort of intentional ignorance the intellectual property law finds problematic. This is a minimally intrusive way to substantiate that the department is doing its part to respect intellectual property holders and those that make their living growing protected seeds.

Comment 7: Eight commenters stated that triticale should not be placed on the list of crops where the variety is required to be stated. A commenter also stated that there is not enough access to non-named varieties of triticale and/or that no non-named varieties exist in Montana. They also pointed out it is not required of some other crops (Alfalfa in particular) in a similar situation.

Response 7: The access level of common seeds is not normally a consideration factor for whether intellectually protected varieties must be listed on the label. The goal of the labeling is to help ensure protected varieties are properly compensated for their use.

Comment 8: Three commenters pointed out that much of the triticale used in Montana comes from Canada and is imported as Variety Not Stated (VNS) so current labeling practices should still be allowed to continue to use the VNS label on those seeds and seed mixes.

Response 8: The federal seed act allows triticale to be labeled as VNS. While Montana has provided additional regulatory protection for wheat under the state seed act, it is unclear at this time that triticale is worthy of additional protection under state law given the disruption it would cause the trade.

Comment 9: Ten commenters pointed out that requiring this label change to triticale will increase the cost of forage in Montana as royalties will have to be paid or decrease the quality of forage (if triticale is not used). This is often paired with the fact that the royalty system was designed for grain/crop production and not forage mixes. Some of these commenters were ranchers.

Response 9: The department believes the comments are correct. Comments 7, 8, and 9 have caused the department to amend the proposed rule to not include triticale currently. Such a change does not seem necessary for the protection of the trade or the research at this time. If parts of the trade believe it to still be necessary, a legislative change is likely the proper course of action.

/s/ Cort Jensen /s/ Christy Clark

Cort Jensen Christy Clark

Rule Reviewer Director

Agriculture

Certified to the Secretary of State January 30, 2024.