Background
Over the last year the California Walnut Board (CWB) has been working with USDA through the Grades & Standards Committee to update the Marketing Order’s mandated outgoing inspection process. The Federal Marketing Order rules governing inspection, which date back to the Order’s inception in 1948, are obsolete as market and customer demands have since surpassed USDA grade standards. Handlers have invested in state-of-the-art equipment to comply with food safety, quality and traceability requirements set by the U.S. Food & Drug Administration (FDA) while also investing in qualified staff to oversee rigorous programs to meet additional market-driven quality standards.
As part of this effort, the CWB voted to suspend mandatory outbound inspections of California walnuts in an effort to provide immediate relief to the industry while the CWB undergoes formal rulemaking changes through the USDA. The USDA enacted a preliminary six-month moratorium on the enforcement of the mandatory inspection requirement, effective September 1, 2021. The decision stands to benefit the industry by mitigating market disruptions, removing redundancies and eliminating duplicative costs.
What’s next?
The preliminary six-month moratorium will be extended when the CWB goes through the formal rulemaking process to update the Federal Marketing Order. As part of this process, CWB will also establish a new method of assessing walnut handlers by moving to a receipts-based collection process. We anticipate the new authority will be available for the 2022/23 crop year and expect assessments to be collected following the formal rulemaking process.
While the CWB works through the rulemaking process, it will continue essential operations by tapping budget reserves to offset the temporary non-collection of assessments. The Board will be evaluating its spending to maintain essential operations while mitigating impacts to ongoing programs.
Q&A
Will there be CWB assessments collected in the 2021/22 season?
No. The CWB will not collect assessments this year.
What are the implications for future CWB assessments?
When the CWB rulemaking process is completed, a new mechanism to collect assessments will be implemented. The CWB anticipates collecting assessments in the 2022/23 marketing year.
If the Board isn’t collecting assessments, will it cease to function?
No. The California Walnut Board will continue operating.
Does this decision change the work of the Board?
The Board will be evaluating its expenditures and determining how best to minimize impacts to its research and promotion programs.
Does this decision impact the California Walnut Commission?
The California Walnut Commission is not impacted by this decision, and assessments will be collected as planned.
