DA-25 Application for Qualification of Cooperative Milk Market

Form Approved
OM B No. 0581-0032
Exp. XX/XXXX
M A I nstruction 115
October 2015
Exhibit A
UNI TED STATES DEPARTM ENT OF AGRI CULTURE
AGRI CULTURAL M ARKETI NG SERVI CE
DAI RY PROGRAM S

APPLI CATI ON FOR QUALI FI CATI ON
OF
COOPERATI VE M I LK M ARKETI NG ASSOCI ATI ON
PURSUANT TO SECTI ON 608c OF THE AGRI CULTURAL
M ARKETI NG AGREEM ENT ACT OF 1937, AS AM ENDED
I NSTRUCTI ONS
General. Applications for qualification of a cooperative marketing association under the Federal milk order program are made for several
purposes. One is to determine whether an association is entitled to certain privileges and exemptions; another is to establish an association’s
authority to speak for its members in producer referendums; a third is to confirm that the members of an otherwise qualified association have
authorized it to collect the payments due them from the milk handlers to whom they deliver; and a fourth is to determine whether a qualified
association is adequately rendering specified marketing services to producers under a particular milk order.
Letter of Application. A partial letter of application is enclosed and needs to be completed on the Association’s letterhead. I f your
application is not for all of these purposes, or relates to the rendering of marketing services under more than one order, the letter should be
modified accordingly. The application letter should be signed by an authorized representative of your Association.
I nformation to be Submitted. The material that should be submitted in support of your application is of two kinds: (1) copies of certain
documents, and (2) information regarding your organization and operations. A list of documents to be submitted appears on page 2.
Use of Guide. M atters to be covered in your informational report are listed under several headings in the guide that follows. Some questions
may be answered on the guide. Other questions requiring more space should be answered on a separate sheet of paper. Your statements
should be complete and should follow the numbering in the guide. Add any information you consider pertinent.
General Requirements. The general requirements for qualification are:
•

The association must include members engaged in the production of Grade A milk.

•

The members must be acting together in marketing milk that is regulated by a Federal milk order, or proposed order.

•

Be a cooperative marketing association of producers, qualified under the provisions of the Act of Congress of
February 18, 1922, known as the “Capper-Volstead Act” (7 U.S.C. 291, 292).

•

Have its entire organization and all of its activities under the control of its members.

•

Have full authority in the sale of its members’ milk.

I nformation in DlVI SI ON A should show whether your Association is in fact controlled by its members. Loss of member control may occur if
there is (1) Undue influence by a dealer or its representatives, by other nonmembers, by a clique, or by inactive members; (2) if management
people have conflicting interests; (3) if the bylaws are not followed; or (4) if members do not participate substantially in directing Association
affairs.
I nformation in DI VI SI ON B should bring out whether your Association observes the statutory limitation on voting or dividend payments.
I t should show also whether voting rights are restricted to active producer members.
I nformation in DI VI SI ON C should describe your marketing function or functions. An association may engage in marketing without
physically handling the product. Any one of the following activities may identify the applicants as a milk marketing association:

DA-25

•

Operating a milk plant that receives members’milk.

•

Sale of milk pursuant to written contracts between the association and its handler customers.

Page 1 of 7

•

Purchase by handlers of members’milk deliveries, not from members as individuals but from the association.

Other information requested in this division relates to the association’s method of distributing earnings and to the association’s services for
the mutual benefit of its members.
I nformation in DI VI SI ON D is to be provided by associations that operate milk plants. I t should give a general view of the applicant’s
physical marketing of members’milk. I t should also show the reliance placed upon others in credit and leasing arrangements, the relative
handling of nonmembers’ products and the identity of the Federal orders under which the plants are regulated.
I f your Association applies for the marketing services exemption, you should show in DI VI SI ON E that you actually perform the services.
They are those of rendering market information to producers, verifying the weights of their milk deliveries, and sampling and testing the milk
for content. Each one is important. The statements and descriptions given here should be detailed enough to provide a complete picture of
your Association’s performance.

DOCUM ENTS REQUI RED
Copies of the following documents should be submitted:
1.

Articles of incorporation, including amendments.

2.

Bylaws, including amendments.

3.

Samples of each type of stock certificate.

4.

M ost recent balance sheet and operating statement, with
auditor’s report and notes.

DA-25

5.

M embership contracts, producer marketing agreements or
membership agreements. I f more than one form of
contract or agreement is in effect, submit copies of each
form.

6.

Written contracts between the association and the
purchasers of its milk.

7.

M anager’s employment contract.

Page 2 of 7

I NFORM ATI ON REPORT GUI DE
DI VI SI ON A -- Association Control (To be answered by all applicants)
A1.

Describe in detail the circumstances under which your Association was organized, including the names of the persons who started
the movement and the immediate purpose in forming it.

A2.

Were any milk dealers or their representatives, counsel, or employees instrumental in forming your Association? Are any now
affiliated with your Association? I f the answer to either question is “yes,” give details.

A3.

Describe the requirements for membership in your Association, including the method by which a person becomes a member.

A4.

How are members solicited? I f members are solicited for your Association by any buyer or others outside of the Association, give
details.

A5.

What persons are eligible to vote on the affairs of the Association?

A6.

How many active members (currently marketing their own milk production through you) did your Association have at the end of
last month? How many of these produced Grade A milk?

A7.

What standards are applied in determining that a member is inactive?

A8.

How is a producer’s membership terminated?

A9.

How long may a producer be inactive before his/her membership is terminated?

A10.

How often does your Association clear your voting rolls of inactive members?

A11.

How long do inactive members retain the right to vote on any business?

A12.

How many inactive voting members did your Association have at the end of last month?

A13.

Do all of your current Directors meet the requirement for Directors as set forth in the bylaws and articles of incorporation? Explain
any deviations.

A14.

List the officers and members of the Board of Directors and for each give the length of service as a director and/or officer, and the
date his/her present term of office expires.

A15

Are any persons other than active members now on the Board of Directors? I f so, give details.

A16.

Give the number of meetings and approximate number of members present at meetings during the last 12 months:
(a) The Board of Directors
(b) The entire organization and
(c) District or regional membership

DA-25

Page 3 of 7

DI VI SI ON B -- Capital Stock (To be answered by all associations having capital stock)
B1.

Give the number of shares of each class of capital stock outstanding and the rate of dividends paid on each class in the last 2 years.

B2.

What voting rights are attached to each class of capital stock outstanding? Tell whether voting rights allow one vote to a share of
stock, or are limited to one vote to a member regardless of the number of shares owned.

B3.

Tell how many shares of voting stock are held by:
(a) Active producers
(b) I nactive producers and
(c) Others (describe)

B4.

What provision is made for retiring voting stock held by inactive producers and others?

DI VI SI ON C -- M arketing (To be answered by all applicants)
C1.

Does your Association have full authority in the sale of your members’milk? I f so, cite documents which give such authority.

C2.

Describe in detail the ways in which your Association markets your members’ milk: bargaining only, processing in own plant, etc.
For a representative month, give the approximate quantities of milk being disposed of in each way.

C3.

Are any of your members also members of another dairy cooperative marketing association? I f so, describe what marketing
functions your Association performs for such members.

C4.

Are any other associations also members of your Association? I f so, list their names.

C5.

Do all members market their milk through your Association?

C6.

Do members have freedom of choice as to which buyer they will deliver milk to?

C7.

Do you guarantee a market for your members’ milk?

C8.

Do you guarantee payment for your members’ milk?

C9.

Do you take physical possession of the milk? I f so, specify in what manner.

C10.

Do you transport milk from members’farms to the buyer’s plant?

C11.

How are the components of milk and milk products sold to dealers determined and priced?

C12.

Does your Association pay commissions or fees on your sales to anyone including employees? I f so, explain fully.

C13.

I f your Association is a member or patron of any other dairy cooperative marketing association or federated group, name the
association or group.

DA-25

Page 4 of 7

C14.

List the names of up to four handlers to whom the greatest volume of milk has been sold during the most recent 12-month period.
I ndicate the percentage of the total volume of milk handled by you that was sold to each such handler.

C15.

For the last 12 months, give the total value in dollars of:
(a) All milk and milk products marketed, and
(b) M ilk and milk products marketed on behalf of members.

C16.

Does your Association collect from handlers the proceeds of sales and pay your members directly?

C17.

Describe any other services performed by your Association for your members in addition to those previously described.

DI VI SI ON D -- Association Plants (To be answered by all associations operating milk plants)
List all plants operated by your association, giving name and location, and indicating:
D1.

The nature of operations conducted at each plant, including the products manufactured, if any.

D2.

Whether each plant is owned or leased. I f leased, submit a copy of the lease and other agreements relative to plant operation.

D3.

The Federal milk order under which each plant is regulated. (I f none, so state.)

D4.

The number of members and nonmembers delivering to all your plants.

DI VI SI ON E -- M arketing Services (To be answered by applicants applying for marketing services exemption)
E1.

Describe in detail the types and frequency of release of market information, both formal and informal, supplied by you to your
members. Submit a copy of the most recent publication.

E2.

Tell how many field persons are employed and what services they perform for your members.

E3.

Tell how many persons you employ for checking weights, sampling, and testing, and indicate for each:
(a) Training, experience, and certification for work being done
(b) Whether connected in any way with any handler buying milk from you. I f so, give details
(c) Proportion of their time spent in this work

E4.

Describe the facilities and equipment used in verifying weights and tests:
(a) Are the facilities and equipment owned by your Association?
(b) I f the facilities and equipment are not owned by you, describe arrangements made for their use, indicating whether they are
available to you at all times.

E5.

Describe in detail your program of verifying the weights, sampling and testing of your members’milk deliveries. How soon after
installation do you check the calibration of members’ farm tanks? How often thereafter? What fresh milk sampling do you do?

E6.

What records does your Association maintain of your verification of weights sampling and testing?

E7

What reports do you make to your members concerning their weights and tests, and how frequently are such reports sent out?
What reports do you submit to the market administrator concerning weights and tests?

E8.

Are buyers paying your members on the basis of butterfat tests or other component tests made by you?

DA-25

Page 5 of 7

E9.

Do buyers make adjustments in payments to your members when you discover discrepancies between their weights and tests and
those ascertained by you?

Enclosure
According to the Paperwork Reduction Act of 1995, an agency may not conduct or sponsor, and a person is not required to respond to collection of information unless it
displays a valid OMB control number. The valid OMB control number for this information is 0581-0032. The time required to complete this information collection is
estimated to average 2 hours per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and
completing and reviewing the collection of information.
In accordance with Federal civil rights law and U.S. Department of Agriculture (USDA) civil rights regulations and policies, the USDA, its Agencies, offices, and employees,
and institutions participating in or administering USDA programs are prohibited from discriminating based on race, color, national origin, religion, sex, gender identity
(including gender expression), sexual orientation, disability, age, marital status, family/parental status, income derived from a public assistance program, political beliefs, or
reprisal or retaliation for prior civil rights activity, in any program or activity conducted or funded by USDA (not all bases apply to all programs). Remedies and complaint filing
deadlines vary by program or incident.
Persons with disabilities who require alternative means of communication for program information (e.g., Braille, large print, audiotape, American Sign Language, etc.) should
contact the responsible Agency or USDA’s TARGET Center at (202) 720-2600 (voice and TTY) or contact USDA through the Federal Relay Service at (800) 877-8339.
Additionally, program information may be made available in languages other than English.
To file a program discrimination complaint, complete the USDA Program Discrimination Complaint Form, AD-3027, found online at
http://www.ascr.usda.gov/complaint_filing_cust.html and at any USDA office or write a letter addressed to USDA and provide in the letter all of the information requested in the
form. To request a copy of the complaint form, call (866) 632-9992. Submit your completed form or letter to USDA by: (1) mail: U.S. Department of Agriculture Office of the
Assistant Secretary for Civil Rights 1400 Independence Avenue, SW Washington, D.C. 20250-9410; (2) fax: (202) 690-7442; or (3) email: [email protected].
USDA is an equal opportunity provider, employer, and lender.

DA-25

Page 6 of 7

LETTER OF APPLI CATI ON
(Please put this application on your association’s letterhead.)
Deputy Administrator, Dairy Programs
Agricultural M arketing Service
United States Department of Agriculture
1400 I ndependence Avenue SW, Room 2968-South
Washington, D.C. 20250-0225
(Date)

Dear Sir/M adam:
We hereby apply for determination of this Association’s qualification as a cooperative association under
marketing orders regulating the handling of milk, with authority to represent members in producer
referendums, having authorization to collect payment from handlers for members’ milk, and rendering
specified marketing services to producers under the order(s) for the
marketing area(s).
This Association was organized under
of the laws of the State of
Our principal office is at

(Citation of Statute)
(State)

on

(Date)

(Street and Number)
(City, State, and Zip Code)
(Telephone Number)
(E-mail address)

We submit herewith copies of documents and other information which we certify to be true and correct.
We also certify that no officer, director, manager, or principal employee or any of their close relations
has a financial interest in any competitor of the Association or in any business organization selling to or
purchasing from the Association, other than his own farm. We also certify that the information herein
and in the accompanying documents and schedules is true, correct, and complete to the best of our
knowledge. The Secretary of Agriculture, or his/her duly authorized representative, may examine our
books, records, files, and facilities to verify any of the information submitted and may procure such other
information as may be required to determine this Association’s qualification.
(Exact Name of Association)
(Name and Title of Authorized Representative)

DA-25

Page 7 of 7