This bill addresses the financial management of milk producer funds by establishing new requirements for milk processors. It defines "milk producer" to include cooperative associations that market milk on behalf of their members. The bill mandates that milk processors hold payments in trust for milk producers until full payment is received, with funds in escrow also considered held in trust. Additionally, it allows milk producers to require the establishment of escrow accounts for payments, detailing specific conditions for deposits and account management. The bill specifies that funds held in trust or escrow are the property of the milk producer and outlines circumstances under which milk processors may be exempt from these requirements.

Furthermore, the bill prohibits milk processors from purchasing raw milk unless they comply with federal milk marketing orders and any agreed provisions. It holds milk processors liable for unpaid raw milk, including the purchase price, interest, and attorney fees. The act does not apply to transactions between cooperative associations acting as marketing agents and their members. Overall, the legislation aims to enhance the financial security of milk producers by ensuring timely payments and proper management of funds.