Appeal by an organization of Vermont dairy farmers from a judgment of the District of Connecticut, Jose A. Cabranes, Judge, upholding the constitutionality of all but one part of a Connecticut statutory scheme requiring the registration and the inspection by Connecticut representatives of dairy farms, including those in Vermont, producing milk for ultimate sale in Connecticut. The statutes were attacked as violative of the Commerce Clause.
Mansfield, Meskill and Newman, Circuit Judges.
MANSFIELD, Circuit Judge:
The Irasburg, Vermont, unit of the National Farmers Organization ("NFO") appeals from a decision of the District of Connecticut, Jose A. Cabranes, Judge, upholding the constitutionality of all but one part of a Connecticut statutory scheme requiring the registration and inspection of dairy farms producing milk to be sold in Connecticut. The statutes were attacked by NFO as placing an excessive burden on interstate commerce in relation to the potential public health benefits that might be derived from them by Connecticut. An earlier decision of the district court had been remanded for further findings. National Farmers Organization v. Commissioner of Agriculture, 496 F. Supp. 509 (D. Conn.), vacated and remanded by unpublished order, 646 F.2d 561 (2d Cir. 1980). We modify the judgment and in all other respects affirm.
The NFO is an organization of approximately 50 dairy farmers in the vicinity of Irasburg, Vermont, who market their milk jointly for resale through a Connecticut-licensed dealer to buyers in Connecticut. Connecticut is a net importer of milk, while Vermont is a net exporter. As of December 30, 1979, approximately 1862 out-of-state milk farms were registered as shippers to Connecticut, compared with 681 Connecticut farms registered there. 529 of the registered out-of-state producers were Vermont milk producers.
Regulation of the sanitation and flavor of milk sold in a state is primarily the responsibility of that state rather than of the federal government. Since milk has a potential for carrying disease, a producing dairy farm must be licensed and inspected by state authorities to assure that the farm is clean and that its methods for feeding and housing cows and for producing, transporting and storing milk meet requirements designed to minimize growth of harmful organisms and assure wholesome milk to consumers. State inspectors periodically examine each dairy farm's cows, buildings, vehicles, reload stations, processing plant, milking equipment, grounds, and the odor and temperature of stored milk.
The National Conference on Interstate Milk Shipments ("NCIMS"), a cooperative organization composed of representatives of the milk sanitation rating and enforcement agencies of all 50 states, has promulgated recommended milk production health standards to assure the safety and quality of milk, including acceptable levels of sanitation and milk quality, known as the Grade A Pasteurized Milk Ordinance ("PMO"). Most states have adopted a principle of reciprocity under which each state will accept another state's milk provided it receives an acceptable PMO rating from the originating state's inspectors. To assist the operation of this voluntary program based on reciprocity the U.S. Public Health Service ("USPHS") publishes quarterly lists of interstate milk shippers and the PMO ratings of their milk as certified by the states and validated by the USPHS, and the Food and Drug Administration conducts bi-annual audits of milk shippers and state enforcement agencies to verify their enforcement of PMO requirements.
Vermont subscribes to this reciprocity program. Those of its dairy farmers who ship milk out of state must meet the PMO rating, submitting to two inspections per year by Vermont representatives. As noted, most states permit such in-state inspections and PMO ratings to serve as substitutes for their own sanitary inspections. Although Connecticut is a member of the NCIMS it does not accept milk from other states on a PMO reciprocity basis but requires out-of-state producers shipping milk to customers within its jurisdiction to meet its standards, which it enforces by its own inspections of farms supplying such milk. Under Connecticut law the Commissioner of that state's Department of Agriculture is vested with the power to investigate and regulate the production of milk sold in that state, and each dairy farm supplier, whether located inside or outside of the state, must register with and obtain a permit from the Commissioner, without which it is not allowed to sell milk in the state. Conn. Gen. Stat. § 22-172.*fn1 The Commissioner is required to inspect regularly all farms supplying milk for sale in the state. Conn. Gen. Stat. § 22-175.*fn2 These inspections are paid for by the state. Under Connecticut's "continuous shipment" statute, Conn. Gen. Stat. § 22-180,*fn3 if a licensed farm discontinues shipments into the state for certain periods of time during the year the Commissioner is not required to continue his periodic inspections of that farm; the farm reverts to the status of a new producer and must apply for a new permit. Rather than risk this penalty Vermont farmers complied with the continuous shipment requirement, at least until it was declared unconstitutional by the district court, forgoing profit opportunities elsewhere. Another Connecticut statute provides that the Commissioner is not required to inspect any additional farms when the total amount of milk sold in the state has exceeded certain levels. Conn. Gen. Stat. § 22-182.*fn4 However, Connecticut does not currently refuse inspections on the ground that it has an adequate supply of milk.
The Commissioner enforces Connecticut standards by having his own state inspectors periodically travel to and from Vermont where they inspect dairy farms shipping or seeking to ship milk to Connecticut for consumption, just as the Commissioner's representatives inspect Connecticut dairy farms. Each Vermont farm, before it will be issued a Connecticut permit, must be inspected by a Connecticut inspector. Thereafter it must submit to such inspections twice a year, in addition to Vermont's own semi-annual inspections under the NCIMS rating program.
Connecticut contends that its inspection procedure advances the health of its citizens by imposing stricter sanitation standards on dairy farmers producing milk for sale in its state than those of Vermont. It points to its requirement that a dairy farm obtain its water supply from a spring or well meeting certain construction standards. It prohibits use of surface water by a dairy farm as a water supply, even if subjected to full-time disinfection, since surface water can in its view still be the source of contamination and disease. Vermont, on the other hand, does not expressly prohibit use of a surface water supply. However, there is no evidence of such use except hearsay to the effect that a very few Vermont dairy farms in the northern part of the state may be using surface water.
Connecticut monitors and makes follow-up enforcement inspections of dairy farms producing milk which is found as a result of laboratory testing and reports analyzed by the Dairy Division of the Connecticut Department of Agriculture to contain impurities such as a high leukocyte or bacteria count. Upon discovering such specific quality problems Connecticut sends out a warning letter to the farmer involved, brings the problem to the attention of that producer's milk handler, and enforces its standards by conducting such follow-up inspection as may be necessary, along with discussions with the farmer, to correct the problem. When Connecticut representatives some years ago first inspected Vermont dairy farmers who were affiliated with the NFO, approximately one-half of those farmers failed to pass the Connecticut inspections.
The record fails to show that Vermont engages in such enforcement through follow-up inspections after monitoring discloses quality problems with respect to specific farms. Instead Vermont relies primarily on private milk handlers to screen the milk quality reports received from the laboratory, copies of which are sent to the state. Upon receiving a laboratory report that shows non-compliance by a dairy farm with sanitation standards, the milk handler is supposed to stop receipt of milk from that farm until further tests reveal that its milk is in compliance. However, there was testimony that the licensed milk handlers in Vermont do not have the personnel required to monitor and enforce Vermont's standards whereas the State of Connecticut does have such personnel and uses them for monitoring and follow-up enforcement through on-site inspection of farms whose milk fails to meet standards.
There is a substantial difference between the period of time Vermont and Connecticut farmers applying for Connecticut permits must respectively wait to obtain the initial farm inspection required for the permit. The Vermont farmer must usually wait up to five weeks after he requests a permit before it is issued whereas the Connecticut farmer waits less than two weeks. The reason for this disparity is geography and expense. Because Vermont farms are more distant from inspectors based in Connecticut than are farms in Connecticut, the Commissioner usually delays Vermont inspections until enough inspection jobs have accumulated to make visits to Vermont for inspection purposes economically feasible. Since fluid milk is perishable and cannot be stored for any appreciable period of time without spoiling, the effect of Connecticut's requirement of an initial inspection for a permit is to discourage new farm candidates from applying for membership in NFO. However, once a candidate is granted a Connecticut permit he faces no further delays attributable to inspection.*fn5 Aside from the initial delay, inspections by Connecticut of Vermont farmers shipping milk to Connecticut do not substantially inconvenience the farmers. A farmer is not required to accompany the inspector on his tour of the farm but may continue his regular chores.
In November 1976, NFO filed the present action against the defendants seeking a declaratory judgment that the latter's enforcement of Conn. Gen. Stat. §§ 22-172 and 22-175 against them violates the Commerce Clause of the United States Constitution, Art. I, § 8, cl. 3. After a bench trial Judge Cabranes, in an opinion dated July 22, 1980, upheld the constitutionality of these statutes on the ground that the burdens imposed by the Connecticut inspection scheme upon interstate commerce were not excessive in relation to the local public health benefits sought to be protected by Connecticut, which represent a valid state purpose. 496 F. Supp. 509. In his opinion Judge Cabranes relied, among other factors, on Connecticut's requirement of an annual tuberculosis test, which is more stringent than Vermont's comparable requirement. Upon appeal we issued an unpublished order remanding on the ground that reliance on this latter requirement was error for the reason that the tuberculosis test was not carried out by Connecticut state inspectors or at Connecticut's expense but by agreement of the parties and would be continued even if the Connecticut inspection statutes should be ...