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chapter-157•Hawaii Revised Statutes, Chapter 157 — Milk Control Act
chapter-157Haw. Rev. Stat. ch. 157CodeJan 1, 1967
Division 1. Government — Title 11. Agriculture and Animals
Hawaii Revised Statutes as published by the Hawaii State Legislature (files updated 1/5/2026 7:14 PM).
"Board" means the board of agriculture and biosecurity, department of agriculture and biosecurity.
"Buttermilk" or "cultured buttermilk" means a fluid product resulting from the souring or treatment, by means of a lactic acid or other culture, of pasteurized skim milk or pasteurized reconstituted skim milk. It contains not less than 8.25 per cent nonfat milk solids.
"Class I milk" includes all Hawaii-produced fresh milk or fresh milk constituents to be utilized in fluid form for human consumption, including pasteurized milk, cream, half-and-half, whole milk, skim milk, buttermilk, flavored milk, flavored skim milk, reconstituted or recombined milk, and filled milk. All Hawaii-produced fresh milk, up to one hundred per cent of the total production quotas for all milk sheds in the State, shall be deemed to be utilized as class I unless utilization is in an excess pool, or as plant shrinkage and route returns are proven.
"Class II milk" includes all fresh milk or fresh milk constituents to be utilized in non-fluid form for human consumption, including ice cream, ice cream mix, cottage cheese, and yogurt.
"Consumer" means any person who purchases milk for consumption.
"Cream" means the fatty liquid or semi-liquid separated from milk and contains not less than eighteen per cent butterfat.
"Distributor" means any person not producing milk who buys, processes, and containerizes milk for sale to consumers, stores, or others. It shall also include a producer-distributor functioning in the producer-distributor's capacity as a distributor.
"Excess pool" means a special pooling technique to be used when fresh milk produced in excess of the total class I and class II requirements of the market and allowable plant shrinkage and route returns is disposed of either at a complete loss or at its highest practical salvage value.
"Filled milk" is any milk, cream or skim milk, whether fresh or recombined, to which has been added or which has been blended or compounded with any fat or oil other than butterfat so that the resulting product is in imitation or semblance of any form of fresh whole milk or cream.
"Flavored milk" or "flavored skim milk" means a beverage or confection consisting of either milk or skimmed milk, to which has been added a syrup or flavor made from wholesome ingredients.
"Half-and-half" means a product consisting of a mixture of milk and cream which contains not less than 10.5 per cent butterfat.
"Licensee" means a licensed producer, licensed producer-distributor, or licensed distributor.
"Milk" is the lacteal secretion, practically free from colostrum, obtained by the complete milking of one or more healthy cows; which contains not less than 8.25 per cent milk solids-not-fat and not less than 3.25 per cent milkfat. For the purpose of milk control, "milk" is any product, containing milk solids, normally produced or marketed through the channels of the fluid milk trade and includes raw milk, pasteurized milk, cream, buttermilk, flavored milk, recombined or reconstituted milk, filled milk, and sterilized milk. "Milk" shall not include butter, cheese, ice cream, or condensed or evaporated milk contained in hermetically sealed cans.
"Milk shed" means any county or portion thereof in the State wherein milk control is established.
"Order" means an order or agreement issued by the board under this chapter implementing rules and formulas adopted pursuant to chapter 91, pertaining to the production, transportation, processing, storage, distribution, and delivery of milk, and the establishment of quotas and the setting of minimum prices of milk within any milk shed in the State during any specified period or periods.
"Pasteurized milk" means fresh milk which has been heated to at least 145 degrees Fahrenheit for at least thirty continuous minutes, or to at least 161 degrees Fahrenheit for at least fifteen continuous seconds, in approved and properly operated equipment.
"Plant shrinkage" means the loss of fresh milk occurring during the processing of milk or milk products and is attributable to such events as leakage, spillage, and unrecoverable milk from vats, pipes, and processing equipment.
"Producer" means any person producing milk or any agricultural cooperative that markets milk for sale to distributors or producer-distributors.
"Producer-distributor" means any person who produces milk, or who produces and buys milk, and processes and containerizes milk for sale to consumers, stores, or others.
"Recombined milk" or "reconstituted milk" means a product which results from the recombining of milk constituents with potable water and which complies with the standards for butterfat and nonfat milk solids of whole milk.
"Route return" means fresh milk returned from retail stores or by retail route customers.
"Shortage" means that the production of Hawaii-produced milk is less than one hundred per cent of the total production quotas for all of the milk sheds in the State.
"Skim milk" or "skimmed milk" means fresh milk from which a sufficient portion of butterfat has been removed to reduce the milk's butterfat content to less than five-tenths per cent.
"Sterilized milk" means an absolutely sterile, preheated product, of natural appearance and flavor, without additives or adulterants, retaining the vitamins and constituents of normal milk and aseptically containerized.
[L 1967, c 260, §3; HRS §157-1; am L 1971, c 184, §1; am L 1972, c 40, §1; am L 1977, c 65, §1 and c 96, §1; gen ch 1985; am L 1986, c 61, §1; am L 1988, c 25, §1; am L 1994, c 144, §1; am L 1997, c 118, §§1, 6; am L 1998, c 19, §1; am L 2008, c 46, §2; am L 2025, c 236, §§17, 18]
L 1986, c 61, §§3, 4.
The department of agriculture and biosecurity through its board is hereby vested with the following powers:
(1) To regulate and supervise in a milk shed the production, transportation, processing, storage, distribution, and delivery of milk, the establishment of quotas and the setting of minimum prices to be paid to producers by producer-distributors and distributors; provided that nothing contained in this chapter shall be construed to abrogate or affect the status, force or operation of any provision of the laws on public utilities, public health, expenditure of public funds or any local health ordinance or health regulation.
(2) To investigate all matters in a milk shed pertaining to the production, transportation, processing, storage, distribution, and delivery of milk, and the establishment of quotas and the setting of minimum prices to be paid to producers by producer-distributors and distributors; to subpoena producers, producer-distributors and distributors, their records, books and accounts, and any other person from whom information may be desired to carry out the purpose and intent of this chapter; and by leave of a circuit court, to order the taking of depositions of witnesses absent from the State. Any authorized employee may sign and issue subpoenas and may administer oaths to witnesses and conduct hearings and investigations. In case of failure of any person to comply with any subpoena issued under authority of this chapter, or the refusal of a witness to testify to any matter regarding which the witness may be lawfully interrogated, the judge of the district court of the circuit in which the person resides or of the circuit in which the person may be personally served, on application of the board or its authorized representatives, shall compel obedience, as in the case of disobedience of the requirements of a subpoena issued from such court or a refusal to testify therein.
(3) To assist all industry-wide programs pertaining to the production, transportation, processing, storage, distribution, and delivery of milk, feed, supplies, animals, and other related agricultural commodities. Such programs may include advertising, feed storage and ensilage programs, heifer replacement program, agricultural park programs, relocation of dairies, and other related programs that would make the milk shed more viable, thereby assuring the production of an adequate supply of wholesome milk for the consumer.
(4) To control the intrastate shipment of milk including shipment of milk between counties.
(5) To make and enforce all rules and regulations and all orders necessary to carry out this chapter.
The operation and effect of any provision of this chapter conferring a general power shall not be impaired or qualified by the granting of a specific power or powers.
[L 1967, c 260, §6; HRS §157-13; am L 1970, c 188, §§39, 40; am L 1971, c 184, §3; am L 1973, c 31, §6; am L 1977, c 65, §2; gen ch 1985; am L 2025, c 236, §17]
For the purpose of enforcing this chapter, including but not limited to the provisions on licensing, setting of minimum prices and quotas, the board of agriculture and biosecurity or any of its authorized employees may enter at all reasonable hours all places within the State where milk is being produced, sold, stored, processed, or containerized, or where the books, papers, records, or documents relating to such transactions are kept, and shall have power to inspect and copy the same. It may administer oaths and take testimony for the purpose of ascertaining facts which in its judgment are necessary to administer this chapter.
[L 1967, c 260, §7; HRS §157-14; am L 2025, c 236, §18]
The board of agriculture and biosecurity may examine and audit the books and accounts of licensed producers, producer-distributors, and distributors for the purpose of determining how payments to producers and producer-distributors are computed, whether the amounts of the payments are fair, or whether any provisions of this chapter affecting such payments, directly or indirectly, have been or are being violated. The board may also examine and audit the costs of the production, handling, processing, distribution, and marketing of milk as they may affect such payments, directly or indirectly. The board shall conduct a monthly audit with Federal Milk Marketing Order specifications which examines and verifies milk utilization by the processing plants. The board may also contract for an independent audit with Federal Milk Marketing Order specifications to examine and verify milk utilization by the processing plants at least once during the fiscal year for each processor when:
(1) A class I milk only situation exists; and
(2) Milk is utilized for other than class I purposes or rejected for reasons other than antibiotics, high temperature, low cryoscope, off-flavor, somatic cell count, or as determined necessary by the board.
The audit report for each processing plant shall be made available after completion.
[L 1967, c 260, §8; HRS §157-15; am L 1988, c 25, §2; am L 1994, c 144, §2; am L 2025, c 236, §18]
[Repealed]
[L 1989, c 109, §2]
Every producer-distributor, distributor, and agricultural cooperative subject to license or regulation under this chapter, in making payments to producers for milk sold or delivered to such producer-distributor, distributor or cooperative, shall clearly set forth the unit price for such milk, whether determined pursuant to federal or state authority or pursuant to agreement, together with the amount of all premiums, subsidies, differentials, deductions, service fees, hauling charges, supply expenses, costs, or adjustments of any nature whatsoever, in such a manner as to fully disclose to the producer the rate, basis and manner of computing such payments.
[L 1967, c 260, §10; HRS §157-17]
At the end of each license year, the board of agriculture and biosecurity shall submit to the governor a report relating to the activities of the milk control program.
[L 1967, c 260, §11; HRS §157-18; am L 1986, c 61, §2; am L 2025, c 236, §18]
It shall be unlawful for any producer, producer-distributor, or distributor to produce, sell, process, or distribute milk in a milk shed unless the person is duly licensed as provided by this chapter. It shall be unlawful for any such person to sell, buy, process, or distribute milk which the person knows or has reason to believe has been produced or handled in violation of this chapter.
[L 1967, c 260, §12; HRS §157-21; gen ch 1985]
An applicant for an original or renewal license to operate as a producer, producer-distributor, or distributor shall file an application upon a form prepared by the board of agriculture and biosecurity, containing such information which the board deems necessary for the administration of this chapter. The board shall establish a reasonable application fee for an original or renewal license which the applicant shall remit when application is filed. An agricultural cooperative all of whose producer-members have complied with the licensing provisions of this chapter shall be exempt from the payment of the application fee.
The license year shall be from July 1 to the following June 30. All applications for renewal of licenses must be duly made at least thirty days before the commencement of the license year.
[L 1967, c 260, §13; HRS §157-22; am L 1977, c 65, §4; am L 2025, c 236, §18]
In order to meet the expenditures necessary to administer this chapter, the board of agriculture and biosecurity shall establish license fees to be paid by producers, producer-distributors and distributors. In determining these fees, the board shall, at least thirty days before the new license year begins:
(1) Project the reasonable expenditures necessary to administer the chapter for the license year;
(2) Project the amount to be paid by applicants for original or renewal licenses for the license year;
(3) Project the reasonable expenditures necessary to conduct an independent monthly audit;
(4) Estimate the total volume of milk to be produced and processed for the license year;
(5) Using (1), (2), (3), and (4) above, establish a reasonable rate per hundred-weight or other unit as determined by the board; and
(6) Collect such fees monthly, or at such other intervals as may be determined by the board, during the license year based on actual milk produced and processed.
To facilitate the collection of license fees, the board may require a producer-distributor or distributor to withhold from any payment owing to any producer a part or all of the license fee due under this chapter by such producer. For any such withholding required by the board, the producer-distributor or distributor shall be paid a reasonable fee by the board. The amount of the fee shall be set by the board. An agricultural cooperative all of whose producer-members have complied with the licensing provisions of this chapter shall be exempt from the payment of the license fee.
[L 1967, c 260, §14; HRS §157-23; am L 1977, c 65, §5; am L 1988, c 25, §3; am L 2025, c 236, §18]
(a) No license shall be denied unless the board of agriculture and biosecurity finds, after due notice and opportunity of hearing to the applicant or licensee, one or more of the following:
(1) That the applicant is not qualified or does not possess equipment to conduct the business properly.
(2) That the issuance of the license will tend to promote destructive or demoralizing competition in a market already adequately served.
(3) That the issuance of the license is otherwise not in the public interest.
(b) The board may refuse to renew a license or may suspend or revoke a license, upon due notice and opportunity of hearing to the licensee, when it finds any of the following:
(1) That any licensee has, without reasonable cause, refused to accept milk delivered or failed to deliver milk as agreed, except where a contract has been terminated.
(2) That any licensee has failed to account or make payment, without reasonable cause, for any milk purchased.
(3) That any licensee has been adjudged a bankrupt.
(4) That any licensee has continued in a course of dealing of such a nature as to indicate the licensee's inability or unwillingness to properly conduct the business of producing, processing, delivering, receiving, or selling milk or of the licensee's intent to deceive or defraud producers, producer-distributors, distributors or consumers.
(5) That any licensee has violated the state antitrust law, chapter 480.
(6) That any licensee has failed to keep records or to furnish the statements or information required by the board.
(7) That any licensee has intentionally made a false or misleading statement upon which the license was issued.
(8) That the licensee has violated or failed to comply with this chapter.
(9) That the licensee has ceased to operate the milk business for which the license was issued.
(c) The board may conditionally renew a license or may conditionally decline to suspend or revoke a license, but such condition shall have appropriate relation to the administration of this chapter.
[L 1967, c 260, §15; HRS §157-24; gen ch 1985; am L 2025, c 236, §18]
The action of the board of agriculture and biosecurity in refusing to grant or renew a license, or in revoking or suspending a license, or in conditioning or limiting the granting or renewal of a license, may be reviewed in the manner provided by chapter 91.
[L 1967, c 260, §16; HRS §157-25; am L 2025, c 236, §18]
The board of agriculture and biosecurity may require licensees to keep such records and information as it deems necessary for the proper enforcement of this chapter.
[L 1967, c 260, §17; HRS §157-26; am L 2025, c 236, §18]
Each licensee shall as required by rule or order of the board of agriculture and biosecurity, file a verified report on forms prescribed by the board of matters on account of which a record is required to be kept, together with such other information or facts as may be pertinent and material within the scope of this chapter.
[L 1967, c 260, §18; HRS §157-27; am L 2025, c 236, §18]
[Repealed]
[L 1998, c 211, §2]
There is established the milk control special fund to be administered by the board of agriculture and biosecurity. All moneys received by the board of agriculture and biosecurity as application fees and for licenses or otherwise under this chapter, and any state appropriations or other moneys made available to carry out the purposes of this chapter, shall be deposited into the special fund. All interest earned or accrued on moneys deposited in the special fund shall become part of the special fund. Moneys in the special fund shall be expended to cover all costs of administering this chapter including but not limited to the costs of salaries, fringe benefits, operating expenses, equipment, motor vehicles, contracts for services, and promotional expenses. Moneys in the special fund may be transferred to the general fund for salaries and fringe benefits of other state employees assisting in administering this chapter and other related costs. A reserve in an amount of not less than $300,000 shall be maintained in the special fund to cover contingency costs including but not limited to accrued vacation leave, audits, unemployment insurance, and workers' compensation.
[L 1998, c 211, §1; am L 2014, c 176, §2; am L 2025, c 236, §18]
Upon petition by fifty-five per cent of all producers and producer-distributors, or by fifty-five per cent of all producers in a prospective milk shed, or upon the board's own motion, the board shall hold a public hearing to establish or terminate a milk shed in a county comprising one island or on one or more islands or a portion of an island comprising a county.
[L 1971, c 184, pt of §4; ree L 1972, c 40, pt of §2]
(a) Upon petition by the producers and producer-distributors who produce fifty-five per cent of the milk in a milk shed, or by fifty-five per cent of all producers in a milk shed, or upon the board's own motion, the board shall adopt rules pursuant to chapter 91 to:
(1) Establish, revise, or terminate the minimum prices or salvage values for milk to be paid to producers and producer-distributors or the quotas for the production of milk in a milk shed, or any of them; or
(2) Establish specific formulas or criteria for determining the minimum prices or salvage values for milk to be paid to producers and producer-distributors or the quotas for the production of milk in a milk shed, or any of them.
For the purposes of this section, each producer-member of an agricultural cooperative shall be counted as a producer, and an agricultural cooperative shall not be counted as a producer or as a producer-distributor.
(b) Public hearings to establish, revise, or terminate minimum prices, salvage values, and quotas or to establish specific formulas or criteria for setting minimum prices, salvage values, or quotas, shall not constitute a contested case as defined by chapter 91.
[L 1967, c 260, §20; HRS §157-31; am L 1971, c 184, pt of §4; ree L 1972, c 40, pt of §2; am L 1977, c 96, §2; am L 1997, c 118, §§2, 6; am L 1998, c 19, §1]
(a) As a guide to determining the minimum prices of milk to be paid to producers and producer-distributors, the board shall take into consideration the following items based on the operations of a reasonably efficient producer:
(1) The price to producers necessary to assure the production of an adequate supply of wholesome milk for the market.
(2) The price necessary to return to the producer, the producer's cost of production, plus a fair return on the producer's invested capital, the producer's family labor and the producer's management skills.
(3) The costs incurred in obtaining, feeding, managing and maintaining dairy animals at optimum production capacity.
(4) The prevailing wages and perquisites of employees.
(5) The ordinary fixed charges and operating expenses incident to the ownership, operation and management of the dairy.
(b) In establishing minimum prices for milk under this chapter, the board shall further consider the effect thereof on the consumer.
[L 1967, c 260, §21; HRS §157-32; ree and am L 1972, c 40, pt of §2; gen ch 1985]
(a) Without regard to the notice and public hearing requirements of chapter 91 and based on the specific formulas or criteria adopted under section 157-31(a)(2), the board may establish by order the minimum prices and salvage values for milk to be paid to producers by producer-distributors and distributors.
(1) Prior to the effective date of any order, the department shall give public notice that includes:
(A) Either a statement of the substance of the proposed order; or a statement of the minimum prices or salvage values for milk to be established, and
(B) A statement that a copy of the proposed order will be mailed to any interested person who requests a copy, together with a description of where and how the requests may be made.
(2) The notice shall be mailed to all persons who have made a timely written request of the department for advance notice of these orders or of the department's rulemaking proceedings. The department may require reimbursement for the cost of preparing and mailing the copies.
(b) The minimum prices and salvage values within each milk shed may vary according to the classes or classifications established by the board; provided that the minimum prices and salvage values for each such class or classification within a milk shed shall be uniform. The minimum prices and salvage values may vary from county to county. The board may adopt rules to prescribe how producers shall be paid for milk sold by them to distributors and producer-distributors.
[L 1967, c 260, §22; HRS §157-33; am L 1971, c 184, pt of §4; ree L 1972, c 40, pt of §2; am L 1997, c 118, §§3, 6; am L 1998, c 2, §32 and c 19, §1; am L 2004, c 20, §1]
(a) To promote a proper balance between supply and demand for milk, the board shall provide that the price to be paid to producers shall be based upon quota assigned each producer by the board, which quota shall be determined as follows: upon petition or chairperson's motion as set out in section 157-31, there shall be established an initial quota for each producer and producer-distributor, which shall be the average of the amount of milk that the producer or producer-distributor produced and delivered during the three-year period prior to January 1, 1967; provided that if a producer or producer-distributor had not been in business for such period, the board may also take into account the producer's or producer-distributor's prior production, contract and the producer's or producer-distributor's investment; and provided further that in any milk shed established subsequent to January 1, 1971, the board shall establish an initial quota for each producer and producer-distributor which shall be the average of the amount of milk that the producer or producer-distributor produced and delivered during the twelve-month period immediately prior to the date of petition or chairperson's motion, and may also take into account prior production, contract and investment factors where any of the producers or producer-distributors shall not have been in business for such twelve-month period. The board shall set the initial quota of a newly licensed producer or producer-distributor entering the market by taking into account all relevant market conditions and the capabilities of the licensee. The board may adjust the initial quotas on a pro rata basis to meet changes in market requirements.
(b) For each milk shed in which quota control or price control or both is to be established, producers or producer-distributors whose dairies are located outside such milk shed shall participate in said quota control or price control, or both, for milk regularly supplied within the affected milk shed. However, in setting the minimum price for the milk the board shall consider only those costs incurred by producers located within the affected milk shed. Any milk delivered and utilized in a milk shed shall be subject to all the provisions and regulations applicable to that milk shed.
(c) When the amount of milk resold for human consumption as fluid milk does not exceed the sum of the quotas to be regularly supplied a distributor or producer-distributor, such fluid consumption milk shall be deemed taken ratably from the quotas actually supplied, and payment shall be made accordingly. The board shall determine which producers, not under written contract with a distributor or producer-distributor, are regular suppliers of milk. The remaining milk not used for human fluid consumption shall be paid for according to its use. However, when the producer-distributor or distributor resells milk, other than recombined or reconstituted milk, for fluid consumption in an amount in excess of all quotas assigned producers or producer-distributors regularly supplying the producer-distributor or distributor milk, then the fluid consumption prices shall apply pro rata to surplus milk, in the ratio that a producer's quota bears to the sum of the quotas. However, whenever there is quota milk available for purchase within the milk shed, surplus milk may not be used as milk to be resold for human consumption as fluid milk.
(d) From time to time when required to meet changes in conditions, the board may alter, revise, or adjust the total quota in any milk shed by rule, pursuant to section 157-31(a)(1), or by order, without regard for the notice and public hearing requirements of chapter 91, based on [the] specific formulas or criteria adopted under section 157-31(a)(2). An order to alter, revise, or adjust the total quota for the production of milk in a milk shed shall be subject to the notice requirements set forth in sections 157-33(a)(1) and 157-33(a)(2) for an order fixing minimum prices or salvage values.
(e) The board may adopt rules governing the transfer of quotas.
[L 1967, c 260, §23; HRS §157-34; am L 1971, c 184, pt of §4; ree and am L 1972, c 40, pt of §2; gen ch 1985, 1993; am L 1997, c 118, §§4, 6; am L 1998, c 19, §1; am L 2008, c 46, §3]
In the event of a shortage, the board shall require all milk produced within the milk shed first serve the needs of the consumers within the milk shed.
[L 1988, c 25, §4]
Whenever any distributor or producer-distributor sells recombined or reconstituted milk for fluid human consumption in a milk shed, the distributor or producer-distributor shall pay the board a compensatory payment to be distributed to all producers who supply milk to the distributor or producer-distributor.
In determining the compensatory payment, the board shall hold a public hearing whenever it deems it necessary to establish the loss of quota suffered by the producers from the sale of recombined or reconstituted milk, the reasonable rate of return the producers would have received if recombined or reconstituted milk were not sold to the public, and the pro rata share each producer should receive from the compensatory fund. The board may, at the request of a distributor or producer-distributor or on its own motion, suspend the operation of this section during periods when the production of milk by producers is inadequate to meet consumer requirements.
[L 1967, c 260, §24; HRS §157-35; ree and am L 1972, c 40, pt of §2]
(a) The board of agriculture and biosecurity may institute such action as may be necessary to enforce compliance with this chapter.
(b) Any person who violates this chapter shall be guilty of a misdemeanor and subject to a fine of not less than $250 or more than $1,000 or imprisonment for not more than one year, or both.
(c) The board of agriculture and biosecurity, after notice and opportunity for hearing, may fine any person who violates this chapter or any rule adopted under this chapter, not less than $250 or more than $1,000 for each separate offense. Each day or instance of violation shall constitute a separate offense. Any action taken to impose or collect the penalty provided for in this subsection shall be considered a civil action.
(d) Lawful compliance with this chapter shall not be deemed a violation of chapter 480.
[L 1967, c 260, §25; HRS §157-41; am L 1989, c 115, §1; am L 2025, c 236, §18]
The board of agriculture and biosecurity may confer with authorities of other states and of the United States with respect to uniform milk control with states or as between states, and with the federal government in its control of prices of milk handled in interstate commerce, and may exercise its powers hereunder to effect uniform milk control. It may join with such other authorities, federal and state, in conducting joint investigations, holding joint hearings, and issue joint or concurrent orders, or orders supplementary to those of the federal government, and shall have the power to employ or designate a joint agent or joint agencies to carry out and enforce such joint, concurrent, or supplementary orders.
[L 1967, c 260, §26; HRS §157-42; am L 2025, c 236, §18]
The license required by this chapter shall be in addition to any other license required by law. This chapter shall not be construed to affect in any manner the relations between any cooperative marketing association and its members organized pursuant to the laws of Hawaii or the United States.
[L 1967, c 260, pt of §27; HRS §157-43]
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