How would quota be handled? Would Congress allow the quota system to be part of a California FMMO?
This would have to be answered in the development of a transition plan from the current state order to a new California FMMO. The 1996 Farm Bill included provisions that would have allowed California to become a FMMO and keep our quota system in tact. That offer by Congress has expired, but that does not mean that Congress would not be willing to pass a similar provision again. An analysis might reveal that it would be better to eliminate the quota system in a California FMMO. In that case quota holders would need to be compensated for their quota. This could be done by reserving a portion of the pool proceeds over some period of time to pay for a quota retirement program. This too would need Congressional action. A more fundamental question is how can quota survive in the California state order if most of the pool proceeds from class 1, 2 and 3 are lost because of reduced classified prices? The system will not survive long if month after month the overbase price is less than the combi
