News of the Day

What is ‘Milk’? FDA Intends to Remove the Word from Nondairy Products

Dairy farmers who want the terms “soy milk” and “almond milk” banished from our lexicon may soon get their way as a federal agency plans to enforce the definition of “milk” as something that comes from a cow, not a plant.

U.S. Food and Drug Administration Commissioner Scott Gottlieb said Tuesday that he intends to implement the change over the next year or so.  The agency has long had a definition of milk as being an animal-based product, but it hasn’t been enforced.

“This has been a little bit of a bugaboo to the dairy industry,” Gottlieb said during a Politico event in Washington, D.C. “But we do have a standard of identity, and I intend to enforce that,” he said.

Before the FDA can implement the change, Gottlieb said, there will have to be public hearings to gather comments.

“It will probably take close to a year to go through that process. But that’s what we intend to do,” he said.

Gottlieb’s comments Tuesday were similar to testimony he presented this spring to the Senate, when he acknowledged the FDA has “exercised enforcement discretion” in not holding food marketers to federal standards limiting the use of standardized food terms.

Sales of milk as a beverage have been in decline for many years, while sales of plant-based beverages are up more than 60 percent during the past five years, according to industry figures.

 

Foxconn to Create Tech Hub in Downtown Eau Claire

Yesterday, Foxconn Technology Group announced plans to establish a technology hub in Eau Claire, by acquiring an historic office building and creating innovation and test centers in that city’s downtown.

The company said the plans are “part of its initiative to spur innovation, attract talent and connect with supply chain partners,” and will “foster entrepreneurship.”

The new centers, to be named Foxconn Place Chippewa Valley, will create at least 150 high-tech jobs in Eau Claire, the company said. The employees will work with companies that will become part of Foxconn’s supply chain and contribute to the development of the AI 8K+5G ecosystem that Foxconn says it is building across the state.

Foxconn Place Chippewa Valley will include two properties. The company has entered into an agreement to acquire ‘The Grand,’ a six-story, 89-year-old building at 204 E. Grand Ave. in downtown Eau Claire. The building will be updated and converted into an incubator and laboratory for next-generation technological solutions.

Foxconn said it has also purchased over 15,000 square feet of co-working space at 200 Eau Claire St., in Haymarket Landing, which is a part of the Confluence Project a public-private partnership aimed at redeveloping the center of downtown Eau Claire and its riverfront. Foxconn will use this space as an innovation center that will be part of a talent and innovation network for the AI 8K+5G ecosystem that Foxconn is creating.

Foxconn said it plans to close on the Eau Claire properties later this year and have its operations there open in early 2019.

“We are excited to expand our Wisconn Valley footprint to the Chippewa Valley and West Central Wisconsin. Our goal in establishing Foxconn Place here is to help inspire innovative ideas, attract talent and catalyze cutting-edge solutions in this part of the state,” said Alan Yeung, Foxconn’s director of U.S. strategic initiatives and president of FEWI Development Corp. “Foxconn Place Chippewa Valley will play a key role in building a vibrant AI 8K+5G ecosystem in the U.S., with Wisconsin at the center of this vision.”

Senator Johnson: Trump’s Trade Policies are Starting to do ‘Permanent Damage’

Sen. Ron Johnson (R-Wis.) warned on Sunday that President Trump’s policies on trade are starting to do “permanent damage.”

Johnson said during an interview with New York AM 970 radio host John Catsimatidis that his state of Wisconsin has “been particularly targeted” by China’s recently imposed tariffs, which came in response to Trump’s trade measure against the country.

Johnson told Catsimatidis that the steel tariffs are “hitting us pretty hard,” adding that he’s heard of price increases of 30 to 40 percent.

“The problem with that is it raises the cost of American-manufactured products, Wisconsin-manufactured products, which makes them less competitive on the global trade market,” Johnson said.

The senator said Trump is “absolutely right” to demand reciprocal trade, but that he hopes Trump will quickly resolve the escalating trade dispute because “right now there is some permanent damage being done.”

Trump imposed 25 percent tariffs on $34 billion worth of Chinese goods earlier this month, prompting reciprocal tariffs from China on American products.

China also accused Trump of launching “the biggest trade war in economic history.”

The Trump administration later announced that it would impose a 10 percent tariff on $200 billion worth of Chinese imports. The country has also promised to retaliate for those tariffs.

State’s Cheese Industry Worried Tariffs will Sever Relationships with Key Markets

With the recent announcement of retaliatory tariffs by neighboring countries in response to President Donald Trump’s duties on steel and aluminum, companies closer to home are looking for creative ways to spare relationships with importers that could be in jeopardy.

Jeff Schwager, president of the Plymouth-based cheese producer Sartori, said the company has negotiated with Mexican customers and importers to split the 25-percent tariff increases in half to help minimize cost for Mexican consumers. Mexico is one of Sartori’s top buyers, comprising about a quarter of the company’s export market.

“That means that business that was profitable to us is now break-even at best,” Schwager said.

Although the company is splitting the tariffs in half with their Mexican brokers and distributors, Sartori’s vice president of marketing, Blair Wilson, said it’s more prudent to lose money now than to sever relationships that the company has built over time.

“In the short-term perspective, it might be better to lose now so in the long-term we can stay viable,” Wilson said.

While a few cheese producers statewide have adopted plans to split tariff costs, executive director of the Wisconsin Cheese Makers Association John Umhoefer said he’s heard of other cheese companies lowering the price of their products so that the final cost with the tariffs represents the former cost for the markets they’re selling into.

Umhoefer said losing established partnerships is a bigger concern for his organization’s members, which number around 500 members from 100 companies in 19 states. That’s because other nations such as New Zealand, Australia and the European Union and poised to jump in on troubled markets, he said.

“Once you shift distribution patterns and set up the complexity of importing, it’s easier to continue to do what you’re doing,” he said, noting that importers might not return to U.S. producers after establishing relationships elsewhere.

That loss of partnerships could prove costly, even if these tariffs only last for a short period of time, said Mark Stephenson, a University of Wisconsin-Madison expert of dairy policy analysis.

“If they’ve spent time building relationships in Mexico, there’s been trust and you’re very hesitant to give that up quickly and easily,” Stephenson said. “You might be willing to sell the product at a loss if you think this is a relatively short-term phenomenon. It’s a means of expressing good will to each other, too.”

According to a news release from the Wisconsin Cheese Makers Association, about $50 million worth of Wisconsin cheese reached Mexican consumers last year. That’s more than one-third of all the exported cheese for the state in 2017.

The WCMA is one of 60 companies that wrote to the Trump administration urging it to rescind the tariffs on steel and aluminum, the association joined the call in hopes of ending retaliatory tariffs from the EU, Mexico, Canada and China that are now impacting the dairy industry.

Governor Announces Dairy Task Force 2.0 Members

Yesterday, Governor Walker announced the members of the Wisconsin Dairy Task Force 2.0 at Wisconsin Farm Technology Days.

The Governor directed Department of Agriculture, Trade and Consumer Protection (DATCP) Secretary Sheila Harsdorf and University of Wisconsin System (UW System) President Ray Cross to establish the Task Force in early June. The Task Force will focus on making recommendations on actions needed to maintain a viable and profitable dairy industry in our state.

“As Wisconsin’s dairy industry continues to face challenges, it is more important than ever that the industry as a whole works together to find ways to maintain our status as a leading dairy state,” said DATCP Secretary Harsdorf. “The diverse and wide-ranging Task Force membership will allow for an important conversation, and I look forward to their recommendations.”

The economic impact of the dairy industry in Wisconsin is significant, employing nearly 80,000 jobs and generating $43.4 billion in state-wide economic impact every year – nearly half of agriculture’s total economic impact.

“The partnership between the dairy industry and the University of Wisconsin goes back a long time, and it has played a vital part in Wisconsin becoming America’s Dairyland,” said President Cross. “The UW System looks forward to continuing to work with farmers and dairy producers to develop and implement innovative and forward-thinking solutions for the Wisconsin dairy industry.”

The Wisconsin Dairy Task Force 2.0 members include:

Farmers:

  • Moriah Brey, Brey Cycle Farm LLC, Sturgeon Bay
  • Andy Buttles, Stone-Front Farm, Lancaster
  • Janet Clark, Vision Aire Farms, LLC, Rosendale
  • Tom Crosby, Crosby’s River Valley Dairy, Shell Lake
  • Dave Daniels, Mighty Grand Dairy, Union Grove
  • Patty Edelburg, Front-Page Holsteins, Scandinavia
  • Don Hamm, Sandy Loam Farm, Fredonia
  • Ryan Klussendorf, Broadland Grass Farm, Medford
  • Shelly Mayer, Mayer Farm, Slinger
  • Dan Pearson, Pearson Farm, River Falls
  • Amy Penterman, Dutch Dairy, Thorp
  • Brody Stapel, Double Dutch Dairy, Cedar Grove
  • Charles Untz, Untz Farm, Lake Mills
  • Darin Von Ruden, Von Ruden Farm, Westby

Milk Processors and Marketers:

  • Steve Bechel, Eau Galle Cheese Factory, Durand
  • Dave Buholzer, Klondike Cheese Company, Monroe
  • Rob Byrne, Schreiber Foods, Green Bay
  • Ted Galloway, Galloway Company, Neenah
  • Paul Scharfman, Specialty Cheese Company, Reeseville
  • Jerry Schroeder, Schroeder Milk Transit, Oconto Falls
  • Jeff Schwager, Sartori Cheese, Plymouth
  • David Ward, Cooperative Network, Madison
  • Elizabeth Wells, Organic Valley, La Farge

Allied Organizations:

  • John Accola, Premier Cooperative, Prairie du Sac
  • Dennis Bangart, AgCountry Farm Credit Services, Marshfield
  • Michael DeLong, First Bank of Baldwin, Baldwin
  • Bradley Guse, BMO Harris Bank, Arpin
  • Melissa Haag, Lodi Veterinary Hospital, Lodi
  • Rene Johnson, Union Bank and Trust Co., Evansville
  • John Schmidt, Landmark Services Cooperative, Appleton
  • Chad Vincent, Dairy Farmers of Wisconsin, Madison

Dr. Mark Stephenson, Director of Dairy Policy Analysis at UW-Madison, will chair the Wisconsin Dairy Task Force 2.0. The Task Force is working to schedule their first meeting in August.

 

Wisconsin Businesses See Reduction in Worker’s Compensation Rate for Third Consecutive Year

The Wisconsin Commissioner of Insurance Monday approved an overall 6.03% rate decrease for Worker’s Compensation premiums for businesses, effective October  1, 2018.

This is the third consecutive year Worker’s Compensation rates have declined, following an 8.46% decline in 2017, and a 3.19% decline in 2016. The latest reduction in premiums is expected to result in an annual savings of about $134 million for Wisconsin employers.

“This is just another indicator that Wisconsin’s investments in its employees’ occupational safety is paying off,” Governor Scott Walker said. “Not only are employers seeing reduced premiums, but efforts to reduce workplace injuries help achieve a healthy labor force, resulting in a decline in rates for the third consecutive year.”

Worker’s Compensation rates are adjusted yearly by a committee of actuaries from the Wisconsin Compensation Rating Bureau. The committee studies the prior losses (claims) of hundreds of categories and professions throughout the state’s employment pool and submits a rate recommendation to the Office of the Commissioner of Insurance, which has final approval over the rates.

“A safe workplace results in a more productive and profitable one for employers,” Commissioner of Insurance Ted Nickel said. “Employers are recognizing the relation between their employees’ safety and the savings that ensue as premiums continue to decline.”

These savings will allow Wisconsin businesses to continue to strengthen their profitability while at the same time ensuring a safe work environment, according to Department of Workforce Development Secretary Ray Allen.

 

President Trump Nominates Brett Kavanaugh to Supreme Court

Tonight President Donald Trump nominated Kavanaugh to fill the vacancy that will be created on the court when Kennedy retires on July 31. If, as is widely expected (and Republicans hope), Kavanaugh proves to be more conservative than his former boss, the Supreme Court could shift further to the right on a variety of high-profile issues, ranging from reproductive rights to affirmative action.

The 53-year-old Kavanaugh is the consummate Washington insider, well-liked in the city’s legal community. Kavanaugh has lived in the D.C. area for essentially his entire life. He was born in Washington and raised in Maryland and, like Justice Neil Gorsuch (who graduated two years after him), attended the Georgetown Preparatory School, a prestigious Catholic boys’ school in Rockville. He left the D.C. area to attend Yale College and Yale Law School, graduating from the latter in 1990, followed by clerkships on federal courts of appeals in Delaware and California. He returned for a fellowship in the office of then-U.S. solicitor general Kenneth Starr, followed by the Kennedy clerkship.

In 2006, President George W. Bush nominated Kavanaugh (for the second time – his first nomination stalled) for a seat on the U.S. Court of Appeals for the District of Columbia Circuit. He has sat on the D.C. Circuit – the springboard to the Supreme Court for three of the current justices – for 12 years.

The confirmation hearings for Justice Neil Gorsuch began roughly a month and a half after he was nominated. Senator Charles Grassley of Iowa, the head of the Senate Judiciary Committee, recently suggested that the confirmation hearing for a nominee with a lengthy track record – which Kavanaugh certainly has – could take longer, so that Kavanaugh might not be confirmed before the Supreme Court reconvenes in October.

 

Officials Make Push for Interstate 41 Expansion

A few state and local officials have started to push for an expansion of a narrow stretch of Interstate 41 between Appleton and Green Bay in an effort to ease congestion and lower the number of crashes.

State Rep. Dave Murphy, a Republican from Greenville, said he has personally noticed issues with traffic on I-41 in the Fox Cities. “It’s very dangerous there and I thought ‘boy, this is really a fatal accident waiting to happen,’” he said.

The stretch of I-41 from Breezewood Lane to the north junction of State 441 has averaged nearly 470 crashes a year in the last five years, according to the state Department of Transportation.

The condition of the road itself, though, is comparable to other highways in the region. The pavement rating between State 15 and State 441 is 79 out of 100. The state typically does not look to repair pavement until the rating gets to 70 or lower.

Murphy said he has talked with Gov. Scott Walker about the possibility of adding the project to a future state budget. The project needs to be enumerated in a state budget before any other work can be done. “I feel like we’re going to try to push forward,” Murphy said.

 

On October 1, Out-of-State Sellers will Be Required to Collect Sales Tax

The United States Supreme Court recently ruled in South Dakota v. Wayfair, Inc., that a state can require out-of-state sellers without a physical presence in that state (i.e., remote sellers) to collect and remit sales or use tax on sales delivered into that state.

Beginning October 1, 2018, Wisconsin will require remote sellers to collect and remit sales or use tax on sales of taxable products and services in Wisconsin.  New standards for administering sales tax laws on remote sellers will be developed by rule.

The rule will be consistent with the Court’s decision in Wayfair, which approved a small seller exception for sellers who do not have annual sales of products and services into the state of (1) more than $100,000, or (2) 200 or more separate transactions. Any small seller exception adopted will not apply to sellers with a physical presence in Wisconsin.

More than 555,000 Wisconsin Families Receiving the $100-Per-Child Tax Rebate

Governor Scott Walker today announced that more than 555,000 families will be receiving $100-per-child before the start of next school year because of the Child Tax Rebate.

Parents who claimed their $100-Per-Child Tax Rebate will receive a check in the mail or a direct deposit before the start of next school year. Those eligible for the Child Tax Rebate needed to apply by July 2, 2018.

There will also be a Back-to-School Sales Tax Holiday for everyone from August 1 – 5, 2018. This means the state sales tax will not be charged for those days on school supplies where each item is $75 or less, clothing where each item is $75 or less, computers where each item is $750 or less, and computer supplies where each item is $250 or less.