Sec. 17. (a) The following definitions apply throughout this section:

(1) "Daily production" means the amount of milk, measured by hundred weight, produced by the positive producer in one (1) day, measured on the day in which the drug residue violation occurred.

(2) "Producer reimbursement" means an amount assessed against the positive producer to reimburse others for milk contaminated by the positive producer's contaminated milk, not including the value of the positive producer's contaminated milk for which the positive producer was not paid.

(3) "Revocation period" means the period after a Grade A producer's permit is revoked under this section that the producer may not apply for a Grade A permit.

(b) A penalty established under this section may not be more severe than the penalty standard for drug residue violations adopted by the National Conference on Interstate Milk Shipments in its Pasteurized Milk Ordinance adopted in accordance with the National Conference's Memorandum of Understanding with the United States Department of Health and Human Services, Food and Drug Administration. The penalty imposed may not exceed one thousand dollars ($1,000) for a first offense or two thousand dollars ($2,000) for a subsequent offense.

(c) A producer whose milk tests positive for drug residues shall pay a civil penalty and participate in drug residue education activities as follows:

(1) The following is imposed on a producer for the first positive test for drug residues within a twelve (12) month period:

(A) The civil penalty shall be determined as follows:

STEP ONE: Multiply the daily production by two (2).

STEP TWO: Multiply the STEP ONE result by three dollars ($3).

STEP THREE: Subtract the producer reimbursement from the STEP TWO result.

The positive producer shall pay a civil penalty that is the greater of the amount determined in STEP THREE or five dollars ($5).

(B) The positive producer must, in conjunction with the producer's veterinarian and an official of the board, complete an approved protocol to prevent future drug residue violations and provide proof of completion to the board of animal health, office of the state veterinarian within thirty (30) days after the drug residue violation. Failure to complete the protocol and submit proof of completion within thirty (30) days results in action to suspend the producer's permit.

(2) The following is imposed for a second positive test for drug residues within a twelve (12) month period:

(A) The civil penalty described in subdivision (1)(A) shall be imposed.

(B) The positive producer must complete an approved protocol described in subdivision (1)(B).

(C) The producer must attend a meeting called by the state veterinarian to discuss the violations and demonstrate that appropriate practices have been implemented to mitigate the risk of further drug residue violations.

(3) The third or subsequent positive test result for drug residues within a twelve (12) month period has the following results:

(A) The board shall initiate action under section 6 of this chapter to suspend or revoke a producer's Grade A permit if the producer has a permit.

(B) The civil penalty set forth in subdivision (1)(A) is imposed.

(C) If a producer requests reinstatement of the producer's permit, the producer must submit to the state veterinarian a set of written procedures that the producer will follow to prevent future drug residue violations. The procedures must be specific, practical, and reasonably likely to lessen the possibility of a drug residue violation when followed by the producer.

(d) The state veterinarian, by special permit, may allow a producer that objects to the imposition of a civil penalty to dump two (2) days of milk production on a first offense and four (4) days of milk production on the second or third offense instead of paying a civil penalty if payment of a civil penalty would impose undue hardship on a producer. The state veterinarian may set the conditions under which the milk is to be dumped and may require documentation from the producer showing the circumstances under which the milk was dumped.

(e) Civil penalties collected under this section shall be deposited in the dairy drug residue abatement fund established by section 31 of this chapter.

[Pre-2008 Recodification Citations: subsection (a) formerly 15-2.1-23-6.5(a); subsection (b) formerly 15-2.1-23-6.5(b); subsection (c) formerly 15-2.1-23-6.5(d) part; subsection (d) formerly 15-2.1-23-6.5(e); subsection (e) formerly 15-2.1-23-6.5(f).]

As added by P.L.2-2008, SEC.9. Amended by P.L.186-2014, SEC.9.