In August, the Secretary of the Interior announced that the Trump Administration would be making revisions to the way the Endangered Species Act (ESA) is carried out under federal regulations. The move was made in part to further the Administration’s goal to “ease the regulatory burden” on citizens. The revised regulations apply to sections 4 and 7 of the ESA, which means they make changes to how species are listed as endangered, how critical habitat for species is determined, how threatened species are treated, and how the different federal agencies cooperate to carry out the ESA.
Revision of endangered, threatened, and critical habitat protections
The changes to how the ESA is carried out were made in three rulemakings published on August 27, 2019. One of the rules, available here, is meant to increase cooperation between federal agencies when carrying out the ESA (this rule is set to become effective on October 28). Changes made by the other two rules, available here, and here, are much more controversial because they have a great impact on how endangered and threatened species and their habitats are treated under federal regulations. The new rules went into effect on September 26, 2019. We discuss some of the biggest modifications below.
First, the rules change the term “physical or biological features” to “physical or biological features essential to the conservation of the species.” This change will likely diminish the number of natural features and areas that will be protected, since only those deemed essential to an endangered species will be protected. Similarly, the new rules give the federal government more leeway to determine when habitat is not critical habitat for species, which may result in less habitat being protected under the new iteration of the rules.
In yet another change, the new rules separate the discussion of “threatened” and “endangered” species within the regulatory text. Due to this uncoupling, some read the new version of the rule as stripping threatened species of protections they enjoyed when they were more closely related to endangered species. The new edition of the rules instead includes factors for determining whether a species can be listed as threatened, such as whether it is likely the species will become endangered in the “foreseeable future,” which will be determined on a case by case basis. Critics of the new rules believe that this language will give the government the discretion to overlook the effects of climate change on a species, which could play out over a period of time longer than the “foreseeable future.” Along the same lines, the rules also make it harder to ban certain activities in order to protect threatened species.
The rules weaken the ESA by allowing the federal government to take into account the actions of states, other nations, and local jurisdictions when listing and delisting species. In other words, if the species is being protected on another level of government or by another country, the U.S. government may be less inclined to protect the species; either by choosing not to list the species, or by removing its threatened or endangered status. Importantly, the new rules also allow “commercial information,” not just scientific information, to be considered when making a decision. Under the old rules, agencies were not allowed to consider the economic impacts of listing or delisting a species. On the whole, the rules seem to give the federal government a lot more discretion to determine that species or habitats should not be protected.
On September 25, 2019, the day before the new rules became effective, the attorneys general from 17 states, including Ohio’s neighbors Michigan and Pennsylvania, sued the Trump Administration in federal court over the changes to the rules. You can find the complaint here. The states assert that the rulemaking violates several federal statutes, including the Administrative Procedure Act, which governs federal administrative agencies. The states further claim that the weakening of protections for endangered and threatened species and their habitats will cause harm to their natural resources, harm to their citizens through environmental degradation, take away the current and future economic benefits of protected species, and increase costs for state governments.
Amidst all the rule changes and lawsuits, members of Congress have been working on their own potential changes to the ESA. Recently, the Congressional Western Caucus, a group of congress members from all around the country who are concerned with land use and resource rights, among other causes, introduced nineteen bills meant to “modernize” the ESA. If you’re interested in the specifics of each bill, they are listed on the Caucus’ website, here. Overall, the bills focus on fixing the ESA by implementing “defined recovery goals” for species, relying on “standardized…publically available” science, and allowing more involvement from states and stakeholders on endangered species decisions.
With action taking place on the administrative, legislative, and judicial levels of the federal government, the way the ESA is written and interpreted seems to be up in the air at present. We will be sure to update the Ag Law Blog with any developments.
Farm Science Review is upon us, and we’re hoping that the low-80s forecast holds true. In addition to checking the weather report, we’ve been monitoring the news for developments in the agricultural law world, and quizzing each other on agricultural law topics so that we’re ready to answer your questions. While we hope you come see our presentations (speaking schedule available HERE), we won’t make you wait until you see us at the Molly Caren Agricultural Center in London to learn what we’ve found in the news.
Here’s our latest gathering of agricultural law news you may want to know:
Family Farmer Relief Act of 2019 signed into law. We’ve talked about this bill on the ag law blog, and now it’s official. With the President’s signature, the debt limit for family farmers seeking to reorganize under Chapter 12 bankruptcy increases to $10 million from an adjusted $4.4 million.
No vote on community rights in Williams County, yet. A proposed county charter for Williams County, Ohio containing language similar to the Lake Erie Bill of Rights may not make it on the November ballot. The Ohio Supreme Court recently refused to compel the Williams County Board of Elections (BOE) to include the charter on the ballot for procedural reasons.
The charter would have declared that the people of Williams County have the right to a healthy environment and sustainable community, and that the Michindoh Aquifer and its ecosystem have the right to exist, flourish, evolve, regenerate. Further, the aquifer would have the right of restoration, recovery, and preservation, including the right to be free from interferences such as the extraction, sale, lease, transportation, or distribution of water outside of the aquifer’s boundary.
Even though the petition to put the charter on the ballot had enough signatures, the BOE believed that the language of the charter violated Ohio law, and therefore exercised its power to reject the petition and keep it off the ballot. The petitioners appealed the BOE’s decision to the Williams County Court of Common Pleas, and that court agreed with the BOE. Instead of going to the Court of Appeals, the petitioners tried to go directly the Ohio Supreme Court because the BOE will soon print the November ballots. The Ohio Supreme Court said the petitioners should have gone to the Court of Appeals first, and that it will not decide on whether the BOE has to include the charter on the ballot until the petitioners do so.
This doesn’t mean the end for the proposed charter, but rather that more court time is in the proposed charter’s future. To read the Ohio Supreme Court’s opinion, click HERE. To read the text of the proposed charter, click HERE.
Hemp, hemp, and more hemp. Legal and policy updates on hemp continue to trickle down from state and federal officials. Since our last blog post, when we released our latest law bulletin on the legal status of hemp in Ohio, there have been a couple additional developments.
One of the latest updates we’ve heard from USDA is that industrial hemp growers in states with a USDA-approved hemp production plan may apply for crop insurance to cover hemp grown for fiber, flower, or seeds starting next year. Ohio is in the process of putting together a hemp program to send to the USDA for approval. Ohio farmers still cannot legally grow hemp until the Ohio Department of Agriculture creates a hemp program and the USDA approves that program, but we are expecting rules to be released from those agencies in the coming weeks. For more about the crop insurance update, read the Risk Management Agency’s press release HERE.
Closer to home, we’ve heard that the Ohio Department of Agriculture (ODA) has requested $3.3 million from the Ohio Controlling Board for staffing along with IT equipment and support. Further, ODA has made statements predicting that it expects to have its rule hemp program rule package ready by the end of the year.
Federal court orders U.S. EPA to reconsider Renewable Fuel Standards waivers and their impact on endangered species. The U.S. EPA is responsible for creating fuel standards that incorporate and blend renewable sources of energy under the Clean Air Act. These standards tell refineries how much of their fuel blend must come from renewable sources of energy; however, the U.S. EPA also has the authority to grant waivers to companies that would have difficulty meeting the standard. The court noted that some industry groups felt that the 2018 rules were too strict, while others argued that they were too lax. The court ended up dismissing all but one of the claims against the U.S. EPA, saying that Congress gave it discretion in developing the standards. However, the court sent the rule back to the U.S. EPA due to an argument by environmental groups that the federal agency failed to conduct a thorough review of the risk to endangered animals, plants, and habitats under the Endangered Species Act. Many farm groups have criticized the Trump administration’s granting of waivers for causing a reduction in demand for their products from energy companies, but it appears that they will have to make their arguments to the administration rather than to the courts. To read the D.C. Circuit’s opinion, click HERE.
Written by Ellen Essman and Peggy Hall
What’s old is new again. To what was likely a mixed chorus of cheers and groans heard around the nation, the U.S. EPA and Army Corps of Engineers today announced the repeal of the 2015 Waters of the United States (WOTUS) rule. The action is “Step 1” in the Trump administration’s two-step plan to repeal and replace the WOTUS rule, which establishes the jurisdictional authority of the EPA and Army Corps over waters and waterways. It came in the form of a final rule that not only repeals the 2015 WOTUS rule set in place by the Obama Administration, but also reverts the entire country back to the old regulatory definitions of “waters of the United States” that were developed in 1986 and 1988 rulemakings and further interpreted by U.S. Supreme Court decisions. Those definitions of WOTUS created a lot of confusion and litigation over the actual meaning of WOTUS, which the 2015 WOTUS rule aimed to clear up. Today’s “Step 1” takes us back to older, earlier definition of WOTUS.
Wait—there’s a Step 2?
Back in February, we wrote a blog post when the Trump administration began what is now “Step 2,” proposing a new definition of WOTUS. If that rule becomes final, it will replace the pre-2015 WOTUS definitions put in place by today’s announcement. So, Step 1 involves reverting back to the old WOTUS definition until Step 2, implementing a new definition, is finalized.
The Trump administration’s proposed WOTUS rule scales back the reach of the 2015 WOTUS rule, which many claimed exceeded the agencies’ regulatory authority over waterways and waterbodies in the U.S. Under the currently proposed rule, tributaries that are “ephemeral”—meaning those that are not around for a great deal of time or created by temporary conditions like rainfall or snowmelt—would not be considered as WOTUS. In both the 2015 and pre-2015 WOTUS definitions, at least some ephemeral streams fell under federal regulation. The currently proposed rule also clarifies waters that are not WOTUS by including a list of such waters. The Trump administration states that its proposed rule would encompass fewer ditches, lakes, ponds, and adjacent wetlands than both the 2015 and pre-2015 versions of WOTUS.
So what’s WOTUS now, exactly?
Until the tide turns again, the definition of WOTUS set in place by today’s announcement is the pre-2015 rule, which is as follows:
- All waters which are currently used, or were used in the past, or may be susceptible to use in interstate or foreign commerce, including all waters which are subject to the ebb and flow of the tide;
- All interstate waters including interstate wetlands;
- All other waters such as intrastate lakes, rivers, streams (including intermittent streams), mudflats, sandflats, wetlands, sloughs, prairie potholes, wet meadows, playa lakes, or natural ponds, the use, degradation or destruction of which could affect interstate or foreign commerce including any such waters: (i) which are or could be used by interstate or foreign travelers for recreational or other purposes; or (ii) from which fish or shellfish are or could be taken and sold in interstate or foreign commerce; or (iii) which are used or could be used for industrial purposes by industries in interstate commerce;
- All impoundments of waters otherwise defined as waters of the United States under this definition;
- Tributaries of waters identified above;
- The territorial seas;
- Wetlands adjacent to waters (other than waters that are themselves wetlands) identified above;
The current WOTUS does not include prior converted cropland or certain waste treatment systems. Importantly, it also contains definitions for the terms wetlands, adjacent, high water, ordinary high water mark and tidal waters—many of these definitions have been the source of the litigation and confusion that led to the 2015 rule.
It’s been a while since we’ve written about the Lake Erie Bill of Rights (LEBOR). As a refresher, LEBOR was passed in February in a special election as an amendment to Toledo’s city charter. LEBOR was meant to create new legal rights for Lake Erie, the Lake Erie ecosystem, and to give Toledo citizens the ability to sue to enforce those legal rights against a government or a corporation violating them. For a longer explanation on LEBOR, see our post here. Since then, lawsuits for and against LEBOR have been filed, and the state of Ohio has passed legislation concerning the language in LEBOR. Updates on those actions will be discussed below.
Update on the Drewes Farm lawsuit
The day after LEBOR passed, Drewes Farm Partnership initiated a lawsuit in the U.S. District Court for the Northern District of Ohio, Western Division, against the city of Toledo. Our initial blog posts concerning this lawsuit are available here and here. In May, we discussed updates to the Drewes Farm lawsuit in yet another blog post. Since our last update, the Lake Erie Ecosystem and TSW’s motion to stay pending appeal and the appeal were both denied, meaning the Sixth Circuit agreed with the district court’s decision to leave the ecosystem and TSW out of the lawsuit. As a result, the current parties to the lawsuit are plaintiffs Drewes Farm Partnership and the State of Ohio, as well as the defendant City of Toledo. In early June, both the Drewes Farm Partnership and the state of Ohio filed motions for judgment on the pleadings. The district court has not yet determined whether to grant the motions; the City of Toledo’s response to the motions is due on August 9, 2019. After the response is filed, the plaintiffs will have a chance to reply.
Toledo Citizens file lawsuit against State of Ohio
In the midst of the Drewes Farm lawsuit, yet another complaint has been filed concerning LEBOR. On June 27, 2019, three citizens of Toledo filed a complaint against the state of Ohio in the Lucas County Court of Common Pleas. In the complaint, the citizens, who all voted for LEBOR, asked the court to find that the state has failed to address pollution in Lake Erie, and due to its inaction, circumstances in the lake are getting worse, that LEBOR is enforceable under the Ohio Constitution and state law, and to issue an injunction to prevent the state from curtailing their rights under LEBOR. Currently, it appears as though no response has been filed by the state of Ohio. Perhaps the state wants to let recently passed legislation do the talking.
State budget bill includes language aiming to invalidate LEBOR, adds water quality initiative
Finally, the Ohio General Assembly has also gotten in on the LEBOR action. On July 18, 2019, Governor DeWine signed the General Assembly’s budget bill into law. Page 482 contains language that seems to be aimed at LEBOR and other environmental community rights initiatives. Most importantly, the bill states:
- Nature or any ecosystem does not have standing to participate or bring an action in any court of common pleas.
- No person, on behalf of or representing nature or an ecosystem, shall bring an action in any court of common pleas.
It will be interesting to see how courts handle lawsuits on behalf of ecosystems and nature after the passage of this budget law.
While the budget bill appears to take LEBOR and initiatives like it head-on, it also created a water quality initiative called “H2Ohio,” which includes a fund in the state treasury. The money in the H2Ohio fund will go toward water quality improvement projects, including projects to reduce phosphorus, nitrogen, and sediment pollution from agricultural practices. With this initiative, the state seems to be offering an alternative way to protect its waters, including Lake Erie.
Work continues on sorting out the legality of LEBOR and the wider problem of Lake Erie pollution, and there appears to be no end in sight. Keep an eye on the Ohio Ag Law Blog for new developments on LEBOR lawsuits and the H2Ohio program!
It’s been a busy July in the ag law world, to say the least. The Ohio General Assembly officially passed the hemp bill and a budget, RMA adjusted its prevent plant restrictions, and we have seen more activity on LEBOR. With everything that is going on, it’s time for another ag law harvest. Here’s our latest gathering of agricultural law news you may want to know:
Ohio Department of Agriculture announces website for future hemp program. Just days after S.B. 57 took effect, the Ohio Department Agriculture (ODA) launched a new webpage declaring “Hemp Is Now Legal.” However, the webpage goes on to explain that hemp cultivation, processing, and research licenses, which are required to legally do those activities, are not yet available as the rules and regulations have not been developed. ODA says the goal is to have farmers licensed and able to start planting hemp by spring 2020. As for CBD, the webpage says that it is now legal to sell properly inspected CBD products in Ohio. Note the “properly inspected” caveat. ODA wants to test CBD products for safety and accurate labeling before the product is sold to Ohio consumers. If they have not already done so, those wanting to sell CBD products should contact ODA to have their product tested. You can view the new webpage HERE.
Judge says $2 billion damages award is too much in Roundup case. A California state judge recently reduced the punitive damages award granted to Alva and Alberta Pilliod from $2 billion to $69 million, and reduced their compensatory damages from $55 million to $17 million. All combined, the couple would still receive $86.7 million in damages. As we previously discussed, the couple successfully convinced a jury that the glyphosate in Roundup significantly contributed to causing their non-Hodgkin’s Lymphoma. In reducing the awards, the judge explained that the punitive damages were excessive and unconstitutional because they exceeded the U.S. Supreme Court’s restrictions. However, the judge denied Bayer’s request to strike the punitive damages award outright.
U.S. EPA denies petition to ban use of cholrpyrifos pesticide. Back in 2007, environmental groups petitioned to have the U.S. EPA revoke tolerances and registrations for the insecticide chlorpyrifos, citing harmful effects to people and nature. Without getting into the merits of the allegations, the timeline and history of the U.S. EPA’s decision is fairly interesting. The U.S. EPA had not completed its review of the chemical by 2015, so the groups took the agency to court, where they received a court order compelling the U.S. EPA to make a decision. The agency issued a proposed rule at the end of 2015 that would have revoked the tolerances; however, the federal court said that the U.S. EPA had not completed a full review nor properly responded to the 2007 petition. Even though it made a decision, the court wanted to see more evidence of a full administrative review. By the time the agency had a chance to fully review the chemical’s effects, the Obama EPA had turned into the Trump EPA. In March 2017, the U.S. EPA issued a denial order regarding the petition, which essentially threw out the petition. The environmental groups submitted an objection shortly after the denial order. By July 2019, the U.S. EPA had a chance to think some more and issued a final order denying the objections. As it stands now, the agency has decided not to revoke tolerances or registrations for chlorpyrifos. To read the agency’s final order denying the objections, click HERE.
Animal Disease Traceability program to require RFID tagging for cattle and bison by 2023. The USDA’s Animal and Plant Health Inspection Service is looking to fully bring animal disease traceability into the digital world, at least for beef and dairy cattle and bison. By requiring radio frequency identification (RFID) tags, the service says that animal health officials would be able to locate specific animals within hours of learning about a disease outbreak, significantly less than with paper records. Starting at the end of 2019, the USDA will stop providing free metal tags, but would allow vendors to produce official metal tags until the end of 2020. At that time, only RFID tags may be used as official tags. Starting on January 1, 2023, RFID tags will be required for beef and dairy cattle and bison moving interstate. Animals previously tagged with metal ear tags will have to be retagged, but feeder cattle and animals moving directly to slaughter will be exempt. To learn more, view the USDA’s “Advancing Animal Disease Traceability” factsheet HERE.
Senators want to fund more ag and food inspectors at U.S. ports of entry. Citing the national interest to protect the nation’s food supply, four U.S. Senators have introduced a bill that would provide the U.S. Customs and Border Protection with additional funding over the next three years. In each of the three fiscal years, the funds would be used to hire, train, and assign 240 additional agriculture specialists, 200 new agriculture technicians who provide support to the agriculture specialists, and 20 new canine teams. The personnel would work at U.S. ports of entry, including seaports, land ports, and airports across the country. If passed, S.2107 would require the Comptroller General of the United States to brief congressional committees one year after the bill’s enactment on how well federal agencies are doing at coordinating their border inspection efforts and how the agriculture specialists are being trained. The bill comes months after U.S. Customs and Border Protection seized nearly a million pounds of Chinese illegally smuggled pork from China, where African swine fever has ravaged the country’s pork industry. For more information about the bill, click HERE.
Cannabis decriminalization bill introduced in Congress. Congressman Jerrold Nadler (D-NY) has introduced H.R. 3884 with the aim to do four things: 1) decriminalize cannabis at the federal level, 2) remove cannabis from the federal controlled substances schedules, 3) provide resources and rehabilitation for certain people impacted by the war on drugs, and 4) expunge certain criminal convictions with a cannabis connection. The bill currently has 30 co-sponsors, including 29 Democrats and 1 Republican. None of Ohio’s members of Congress have signed on as a co-sponsor at this time. The bill follows the recent change in status for hemp, which found favor in the 2014 and 2018 Farm Bills. However, that change in status was largely predicated on the argument that hemp is not marijuana, so it remains to be seen whether the political climate is ready to loosen restrictions on marijuana as well. For more information about the bill, click HERE.
The funny thing about a "budget bill" is that it’s not all about the budget. Many laws that are not related to the budget are created or revised within a budget bill. That’s the case with Ohio’s HB 166, the "budget bill" signed on August 18 by Governor Dewine. In the midst of the bill’s 2,602 pages are revisions to an important law for agricultural landowners—the “Right to Farm” Law.
Ohio’s Right to Farm Law, also referred to as the "Agricultural District Program," provides immunity from a civil nuisance claim made by those who move near an existing farm. To receive the immunity under the old law, the land must be enrolled as an “agricultural district” with the county auditor, agricultural activities have to be in place first, i.e., before the complaining party obtained its property interest, and the agricultural activities must not be in conflict with laws that apply to them or must be conducted according to generally accepted agricultural practices. The immunity comes in the form of an affirmative defense that a farmer can raise if sued for nuisance due to agricultural activities such as noise, odors, dust, and other potential interferences with neighbors. If the landowner can prove that the activities are covered by the Right to Farm law, the law requires dismissal of the nuisance lawsuit. For years, we’ve been encouraging farmers to enroll land in this program to protect themselves from those who move out near a farm and then complain that the farming activities are a nuisance.
The new revisions to the law in the budget bill change the requirements for the land and agricultural activities that can receive Right to Farm immunity. In addition to protecting agricultural activities on land that is enrolled with the county auditor as agricultural district land, the law will now also protect the following from nuisance claims:
- Agricultural activities on land devoted exclusively to agricultural use in accordance with section 5713.30 of the Revised Code, which is Ohio’s Current Agricultural Use Valuation Program (CAUV), and
- Agricultural activities conducted by a person pursuant to a lease agreement, written or otherwise.
These two provisions significantly expand the geographic scope of the Right to Farm law. A landowner may not have to take the step to actively enroll and re-enroll land in the agricultural district program in order to obtain Right to Farm immunity. Instead, the agricultural activities are automatically covered by the Right to Farm law if the land is enrolled in Ohio’s CAUV property tax reduction program or is under a lease agreement, presumably a farmland lease, whether that lease is in writing or is verbal. This means that any land in Ohio that is actively being used for commercial agricultural production will likely qualify for the Right to Farm law’s nuisance protection.
The budget bill also added new language to the Right to Farm law that clarifies that “agricultural activities” means “common agricultural practices.” The law specifically includes the following as “common agricultural practices:”
- The cultivation of crops or changing crop rotation;
- Raising of livestock or changing the species of livestock raised;
- Entering into and operating under a livestock contract;
- The storage and application of commercial fertilizer;
- The storage and application of manure;
- The storage and application of pesticides and other chemicals commonly used in agriculture;
- A change in corporate structure or ownership;
- An expansion, contraction, or change in operations;
- Any agricultural practice that is acceptable by local custom.
This new language answers a question that we’ve long heard from farmers: if I expand my farming operation or change it from the farming activities that I, my parents or grandparents have always done, will I still have Right to Farm protection? We couldn’t answer this question with assurance because the law is unclear about whether it would also protect such changes. Under the new law, the answer is clear: transitions to new or expanded agricultural activities will also receive Right to Farm immunity. The law also states that certain practices, such as storing and applying fertilizers, pesticides, chemicals and manure, are “common agricultural practices.”
The final change to the Right to Farm law concerns a provision that addresses farmers suing other farmers for nuisance. Under the old law, Right to Farm immunity does not apply if the plaintiff who brings the nuisance law suit is also involved in agricultural production. That is, farmers don’t receive Right to Farm protection from nuisance claims by other farmers. The new law removes this provision. Under the revised law, farmers will be able to raise the Right to Farm law as an affirmative defense if sued for nuisance by another agricultural producer.
Many lawmakers who were focused on understanding and negotiating the financial provisions in Ohio’s recent budget bill may have missed the inclusion of changes to our Right to Farm law in the bill. Even so, with the passage of the budget bill, the legislature significantly expanded the reach of the Right to Farm Law and agricultural activities in Ohio now have broad protections from nuisance lawsuits.
Find the changes to Ohio’s Right to Farm Law--Ohio Revised Code 929.04, on pages 308 and 309 of HB 177, which is available on this page.
Tags: Right to Farm law; nuisance; budget bill; LEBOR; Lake Erie Bill of Rights; affirmative defenses; immunity
The OSU Extension Farm Office team has returned from the National Farm Business Conference in Wisconsin. We gained some fresh perspective on events beyond Ohio’s borders, but are happy to be back in slightly warmer weather. Our colleagues from across the nation presented on a variety of farm management topics, and we had a chance to discuss some of our recent projects. We also toured a number of dairy and agritourism farms, and of course ate lots of cheese curds. The fresh perspective means that it is time for a fresh Ag Law Harvest.
Here’s our latest gathering of agricultural law news that you may want to know:
OSU Extension Ag Law Team featured on Agronomy and Farm Management Podcast. Recently we had a chance to talk with OSU Extension Educators Amanda Douridas and Elizabeth Hawkins, who together moderate the bi-weekly Agronomy and Farm Management Podcast for OSU Extension. We discussed the status of Ohio’s hemp bill and what we expect to happen in the near future with hemp regulation and production. Then we provided an update on the Drewes Farm Partnership v. City of Toledo lawsuit, which grapples with the legality of the Lake Erie Bill of Rights. Click HERE to listen to the podcast, and look for episode 28.
Minnesota focuses new commercial nitrogen fertilizer regulations on drinking water quality. In an effort to protect public drinking water sources, the Minnesota Department of Agriculture has chosen to regulate the commercial application of fertilizer. The state has long regulated the application of manure, but not commercial nitrogen. The regulations focus on two types of geographic areas: regions with vulnerable soil (coarse soils, karst geology, or shallow bedrock) and farms located in Drinking Water Supply Management Areas. These management areas are designated based upon nitrate levels found in the drinking water. Starting in 2020, the state will ban the application of commercial nitrogen in these areas during the fall months and on frozen ground. Farms in any of the 30 Drinking Water Supply Management Areas would have to follow best management practices to start, but if nitrate levels continue to exceed state limits, then the state may impose additional restrictions in an area to reduce nitrogen pollution. For more information on Minnesota’s Groundwater Protection Rule, click HERE.
Federal court puts a hold on Bud Light’s “100 percent less corn syrup” ads. If they missed seeing it live during the Super Bowl, most people in the agricultural industry have at least seen the recent Bud Light advertising campaign that claims the beer uses no corn syrup while its competitors do. Shortly after the initial release of the ad, MillerCoors sued Anheuser-Busch, which makes Bud Light. MillerCoors wants a permanent injunction that would stop Bud Light from continuing its corn syrup advertising campaign, arguing that the advertisements are false and misleading to consumers. The first step to a permanent injunction is often a preliminary injunction, which makes a party act or not act in a certain way only while the case is pending. The judge presiding over the lawsuit granted MillerCoors’ motion for a preliminary injunction in part. The judge ordered Anheuser-Busch to temporarily stop using ads mentioning corn syrup if those ads do not contain language explaining that Bud Light does not use corn syrup in the brewing process. The judge’s act does not ban the ad that premiered during the Super Bowl. Rather it only blocks ads released later that claim Bud Light uses 100 percent less corn syrup than competitors like MillerCoors. Click HERE to view the complaint, and HERE to view the judge’s order.
It’s (mostly) official: USDA’s ERS and NIFA are headed to Kansas City. U.S. Secretary of Agriculture Sonny Perdue announced the USDA’s selection of the Kansas City, Missouri region as the new headquarters for the Economic Research Service and National Institute of Food and Agriculture. The location changed caused a great deal of controversy as some viewed it as a political move. However, the USDA has maintained that relocation will save millions of dollars over the next few years and put the agencies closer to a number of other USDA offices in Kansas City, such as the Farm Service Agency’s Commodity Operations Office. The Secretary reduced some of the controversy by scrapping plans to place the agencies under the USDA’s Chief Economist, who is a political appointee. Before we call the move a done deal, we must note that Congress could stop the plans. The U.S. House of Representatives might block the move via a Department of Agriculture-FDA spending bill currently under consideration. Click HERE to read Secretary Perdue’s press release.
Bayer announces multi-billion dollar hunt for glyphosate replacement. Somewhat buried in a press release titled “Bayer raises the bar in transparency, sustainability and engagement,” Bayer recently announced a substantial investment in its weed management research. Over the next ten years, the company plans to spend 5 billion euros, or roughly 5.6 billion U.S. dollars, to develop weed control products as alternatives to glyphosate. The announcement comes at a time with thousands of plaintiffs across the United States have claimed that the widely-used glyphosate caused their cancer. As we have previously discussed in the Ag Law Blog, the first three juries have in total awarded plaintiffs billions of dollars in damages. Bayer continues to fight the allegations and defend its product, but the press release marks the first time that Bayer has publically announced a search for an alternative to glyphosate. It remains to be seen whether the press release could have an impact in the lawsuits, but Bayer will likely try to keep the press release out of the trials by using court rules of evidence.
Ohio House passes amusement ride safety bill. County fair season has officially kicked off in Ohio, and some state lawmakers want to make sure that amusement rides at those fairs are safe. House Bill 189 seeks to heighten Ohio’s amusement ride safety inspection standards and impose additional duties on amusement ride owners. The bill would require the Ohio Department of Agriculture to adopt ride classification rules that identify types of rides needing more comprehensive inspection, along with the minimum number of inspectors and number of inspections for each ride. Further, the bill would require amusement ride owners to keep a manual for each amusement ride, and make it available upon request of an inspector. Amusement ride owners would also have to keep records, including documents and photographs, of all major repairs along with all locations where the owner stored or operated each ride. The bill includes an emergency clause, which would allow it to take effect as soon as the Governor signs it. Lawmakers named the bill “Tyler’s Law” after the young man who died following an equipment breakdown at the Ohio State Fair in 2017. Click HERE for more information about the bill.
Sparse dry weather conditions haven't dampened concerns about the extent of agricultural water quality problems we may see when summer weather finally arrives. Despite the weather, harmful algal bloom (HAB) predictions for the summer are already out and are one important measure of water quality impacts that are attributed to agriculture. As HABs arise, so too do the questions about what is being done to reduce HABs and other water quality impacts resulting from agricultural production activities. We set out to answer these questions by examining key players in the water quality arena: the states.
In our new national report, State Legal Approaches to Reducing Water Quality Impacts from the Use of Agricultural Nutrients on Farmland, we share the results of research that examines how states are legally responding to the impact of agricultural nutrients on water quality. After examining state laws, regulations and policies across the country, we can make several observations about state responses to the agricultural water quality issue. First, more activity occurs in states that are near significant water resources such as the Chesapeake Bay, Great Lakes, Mississippi River and coastal regions. States in those areas have more legal solutions in place to address nutrient impacts. Next, nearly all states rely heavily on nutrient management planning as a tool for reducing agricultural nutrient impacts on water quality. We also note that there is an absence of monitoring, bench marking, and data collection requirements in the laws that address agricultural nutrient management and water quality. Finally, many states have piecemeal, reactionary approaches rather than an organized statewide strategy accompanied by a locally-driven governance structure.
As we conducted our research, two types of approaches quickly emerged: mandatory and voluntary. Mandatory approaches are those that require specific actions or inactions by persons who use nutrients on agricultural lands, while voluntary approaches allow a user of agricultural nutrients to decide whether to engage in programs and practices that relate to water quality, with or without incentives for doing so. Because we could identify mandatory approaches through statutory and administrative codes, we were able to compile the laws into a database. Our compilation of Mandatory Legal Approaches to Agricultural Nutrient Management is available on the National Agricultural Law Center's website.
We classified the state mandatory approaches into three categories:
1. Nutrient management planning is the most common mandatory tool used by the states. All but two states mandate nutrient management planning, but the laws vary in terms of who must have or prepare a nutrient management plan (NMP). In the report, we provide examples of states that require NMPs for animal feeding operations, those that require NMPs only in targeted areas, those that require all operators to have an NMP, and those that require preparers of NMPs to be certified.
2. Nutrient application restrictions are becoming increasingly common across the states, but also vary by type of restrictions. In the report, we categorize four types of nutrient application restrictions and present the combination of restrictions in place in five states across the country:
---Weather condition restrictions
---Setback and buffer requirements
---Restrictions on method of application
---Targeted area restrictions
3. Certification of nutrient applicators is an approach used by 18 states, but state laws differ in terms of who must obtain certification. Some states require only animal feeding operations and commercial "for hire" applicators to be certified, while others extend certification to private landowners, users of chemigation equipment, or those in targeted sensitive areas. We provide examples of each type of certification approach.
The number and types of voluntary approaches to reducing agricultural nutrient impacts on water quality is extensive and more than we could identify and gather into a state compilation. In our report, however, we present examples of four types of voluntary approaches states are taking:
1. Technical assistance in the form of technical expertise and informational tools.
2. Economic incentives such as cost share programs, tax credits and water quality trading programs.
3. Legal protections for those who engage in nutrient reduction efforts.
4. Research and education programs that aim to increase understanding of the problem and expand the knowledge base of those who use and work with nutrients.
Please read our report, available here, to learn more about legal approaches states are taking in response to concerns about the impact of agricultural nutrients on water quality. We produced the report with funding from the USDA National Agricultural Library in partnership with the National Agricultural Law Center.
The controversy over the 2015 Waters of the United States (WOTUS) rule never really leaves the news. Case in point: last week, on May 28, 2019, the U.S. District Court for the Southern District of Texas decided to keep a preliminary injunction that prevents the enforcement of the 2015 version of the rule in Texas, Louisiana, and Mississippi, meaning that the 2015 rule does not currently apply in those states. Meanwhile, at the end of March, the U.S. District Court for the Southern District of Ohio was not persuaded by Ohio and Tennessee to issue a preliminary injunction which would have halted the execution of the 2015 rule in those states. All of this judicial activity is taking place while the Trump administration is working on a replacement for the Obama administration’s 2015 rule.
If you’re a regular follower of the Ag Law Blog, you know we’ve written numerous updates on the WOTUS saga. For a refresher, the WOTUS rule defines which waters are considered “waters of the United States,” and are consequently protected under the Clean Water Act. In 2015, the Obama administration promulgated its final WOTUS rule, which many agricultural groups and states felt regulated too many waters. Needless to say, many lawsuits over the rule ensued. The Trump administration, hoping to replace the Obama-era rule, released its new proposed rule on February 14, 2019. The comment period for the proposed rule ended on April 15, 2019. The new rule is forthcoming, but in the meantime, due to all of the litigation, whether or not the 2015 WOTUS rule is applicable varies by state. For an explanation of the 2015 rule and the new proposed rule, see our previous blog post here.
Judge continues to block 2015 WOTUS in Texas, Louisiana, and Mississippi…
At the end of May, Judge George C. Hanks Jr. of the U.S. District Court for the Southern District of Texas handed down a decision remanding the 2015 WOTUS rule to the EPA and Army Corps of Engineers and ordering that a previously issued preliminary injunction stay in place, meaning that the government should not implement the 2015 rule in Texas, Louisiana, and Mississippi. While Judge Hanks declined to take up the questions raised by the plaintiffs about the constitutionality of the 2015 rule, he did determine that the agencies violated the Administrative Procedure Act (APA) at the rule’s conception. The APA is a federal law that controls how federal agencies must go about making regulations. Importantly, the APA dictates that agencies should give the American public notice of a proposed rule, as well as a chance to comment on a proposed rule. In the case of Obama’s 2015 WOTUS rule, the definition of “adjacent waters” was changed from being based upon a “hydrologic connection” in the proposed rule to being based on how many feet separated the waters in the final rule. Interested parties did not have any chance to comment on the change before it was included in the final rule. What is more, interested parties did not have the chance to comment on the final report that served as the “technical basis” for the rule. For these reasons, Judge Hanks found that the final rule violated the APA. As a result, he remanded the rule to the agencies to fix and left in place the preliminary injunction blocking the implementation of the rule in Texas, Louisiana, and Mississippi.
…but 2015 WOTUS still applies in Ohio and Tennessee
A decision in the District Court for the Southern District of Ohio came to the opposite conclusion of the Texas case. In March of this year, Judge Sargus denied the states’ motion for a preliminary injunction against carrying out the 2015 WOTUS rule. Sargus did not agree that Ohio and Tennessee were being irreparably harmed by having to follow the 2015 rule, and therefore did not go through with what he called the “extraordinary measure” of providing the states preliminary injunctive relief. Basically, Ohio and Tennessee were not persuasive enough in their argument, and “failed to draw the Court’s attention” to any specific harm the states faced from the 2015 rule. Therefore, as of this writing, the 2015 WOTUS rule still applies in Ohio and Tennessee.
What regulation applies in which states?
All of these lawsuits with different outcomes beg the question: what rule is applicable in which state? EPA has a map depicting which states must currently follow the 2015 rule, and which states instead must follow the pre-2015 definition of WOTUS. The map has not been updated since September of 2018. Since the last update, Colorado, Michigan, New Mexico, and Wisconsin, whose governors’ mansions flipped from red to blue in November, have pulled out of lawsuits against the 2015 rule. These withdrawals could affect which version of WOTUS applies in these states.
Although the outcomes in the different lawsuits throughout the country presently affect which version of the WOTUS rule applies in which state, it is not clear how the rulings will ultimately affect the 2015 WOTUS rule. The Trump administration is currently carrying out its plan to scrap the rule and replace it with new language, which may render all of the existing legal fights over the 2015 rule irrelevant.
The new WOTUS rule, which is expected in its final form later this year, will probably not mark the end of the WOTUS debate. While implementation of the new rule will likely make the aforementioned lawsuits moot, it doesn’t necessarily mean we’ll be out of the woods yet. With all the contention over this topic, it is likely lawsuits will be filed challenging the new rule, as well. Disagreement over what makes up WOTUS might be around for as long as rivers flow.
With all the rain and delayed planting that Ohio farmers have experienced this spring, signing a solar lease has been a very appealing prospect for many farmland owners. While this may be the right decision for a farm, it is very important that the farmland owner understand exactly what he or she is signing. Once an energy developer offers to pay you to enter into an agreement, and you sign that agreement, its terms will be legally binding.
In our recent blog post on solar leasing, we discussed some of the early documents that a farmland owner is likely to receive from an interested solar energy developer. Further, we gave some general advice on what farmland owners should do if an energy developer wants to discuss leasing his or her land. One of our main suggestions was to take the time to fully understand what the farmland owner is getting into, and that is where this post comes in.
In this blog post, we highlight some of the important provisions of a solar lease that you as a farmland owner should look for in your solar lease, and understand what they mean. A good solar lease will be very thorough, and include a lot of legalese. Our upcoming Ohio Farmland Owner’s Guide to Solar Leasing, due out in the next month, will go more in depth than this blog post on the terms below and more. It would also be a wise decision to consult with an attorney to ensure that your understanding of your solar lease reflects what the documents say.
For now, here are a few provisions to be on the lookout for in your solar lease:
The term. How long does this lease last? Most solar leases last for 20 to 30 years. This is the time during which solar energy is being collected and sold. Solar energy developers like this multi-decade duration because it allows them to use of the solar panels for their expected productive lifespan.
Thirty years is a long time. Many careers are retirement-eligible after that period, and many farms will transition to the next generation in that amount of time. This long of a term is not necessarily a bad thing. It just means that a farmland owner should look back and look ahead. Think back 30 years to 1989. What all has changed on your farm? What would it have looked like to not be able to use this ground for the past 30 years? Now look ahead. What do you expect your needs and those of your family to look like when this lease ends in 2049? Only you can determine if not being able to use your land for that long is a good thing.
Phases. How is this lease broken up? We just explained that most solar leases will last for 20 to 30 years, but that clock usually starts ticking once construction has started on the project. Solar energy developers will often reserve a year or two during which they can conduct their final feasibility studies and obtain necessary permits. Some leases structure this pre-construction phase as merely an option phase, meaning that the energy developer will pay a small amount of rent to keep its option alive for that one or two-year period, but it does not necessarily have to commence construction.
Further, toward the end of the term, the energy developer may have written in an option to renew for another 5 or 10 years. These renewals are often structured as a right that the energy developer may exercise merely by giving notice to the landowner. Additionally, in the middle, if there is a natural disaster that puts the operation out of service for any period of time, a solar lease may stop the clock from ticking until the project is operational again and solar energy is being collected.
The important take-away for the phases is being able to know when each phase begins and ends. When all of the different phases are combined, instead of just a 30-year lease, you could be looking at a 42-year agreement. The only way to know how long it could last is to thoroughly read the entire lease.
A description of the premises. Every solar lease will contain a description of the premises. If an entire parcel is being leased, then this part is fairly easy. However, if only a portion of the parcel is being lease, the farmland owner will want to make sure that the lease provides an adequate description so that the leased portion can be easily determined on the ground. Often, this will include a survey and maps. Knowing the boundaries is important because these leases are often exclusive, such that the farmland owner has little or no use or access of the leased land throughout the term.
Easements. What rights are being granted to the solar energy developer? Solar leases include a series of easements that give the solar energy developer the right to use your land. Some of the common easements include a:
- Construction easement: a right to cross over portions of the farmland owner’s property in order to construct the solar facility
- Access easement: a right to cross over portions of the farmland owner’s property to reach the solar facility
- Transmission easement: a right to install power lines, poles, and other equipment to transmit the energy produced by the solar panels to the grid
- Solar easement: a right to unobstructed access to the sun without interference from structures or other improvements
- Catch-all easement: a general right to do whatever is necessary for the benefit of the project
Solar energy developers want their easements to be as broad and generous as possible in order to maximize their flexibility with the project. This is not always to the advantage of the farmland owner. If the lease is general enough to allow the solar energy developer to sub-lease to another entity such as a telecommunications company, the landowner will have a difficult time preventing the solar energy developer from doing so. The farmland owner wants to make sure that the easements being granted are specific enough to not result in any surprises.
Landowner obligations and rights. What does the lease require of you as the farmland owner? Usually private solar energy developers include a non-interference provision, a quiet enjoyment provision, and an exclusivity provision. All combined, these provisions are a promise by the farmland owner to not enter the solar facilities without prior permission, not interfere with the solar facilities, and not allow anyone else to do so for the duration of the term.
Further, solar leases often include a confidentiality provision that courts will enforce as legally binding. These provisions allow the solar energy developer to control the flow of its proprietary information, and also prevent landowners from talking with one another about topics such as rent rates. It is important to understand:
- What information is protected
- If there are any exceptions
- When consent might be granted
- If specific penalties apply
- How long confidentiality lasts
The solar lease may also include a provision about farmland owner improvements. These explain if and when the landowner needs to obtain prior approval of the solar energy developer in order to build a structure or plant something that may interfere with the solar project.
Property maintenance. Who is going to mow? Ohio landowners have a legal duty to cut noxious weeds, and a well drafted lease will cover which party to the lease bears responsibility for keeping the leased land clear. Usually, the solar energy developer will take this responsibility, but it helps to have this in writing.
Cleanup terms. Cleanup involves a lot of questions. Does the solar lease require the solar energy developer to restore the land to its previous state? If so, how is this measured? Will all stakes and foundations be removed? Will all improvements, like roadways, be removed? How will the solar energy developer guarantee that it will be able to pay for this cleanup in 30 years? Does it post a security, and if so, when? A thorough lease will answer these questions.
Tax and conservation penalties. Tax and conservation also involves a lot of questions because constructing and operating a solar facility will make the property ineligible for the full benefits of CAUV and most conservation programs. Does the lease require the solar energy developer to cover real estate taxes? Does the lease require the solar energy developer to cover the three-year lookback penalty for removing land from CAUV? What will the solar energy developer do toward the end of the lease so that the land can be put back into production and made CAUV eligible again? Similar questions must be asked for conservation programs.
Compensation. It’s not that we saved the fun and best part for last. We just wanted to make sure that compensation is not the first and only thing considered when deciding whether or not to enter into a solar lease. While it certainly is important, some of the issues discussed above must be just as carefully understood.
The solar leases that we have seen involve cash rent that increases over time based upon a fixed escalator. The escalator is a percent increase. If the escalator increases at a rate greater than inflation, then the farmland owner will receive more bang for his or her land. However, if the escalator increases at a rate lower than long-term inflation, then the solar energy developer will have to pay less over time.
Another point of compensation to consider is how damages will be calculated for harm to property and crops. When the solar energy developer decides it is time to start construction, its option and easements grant it the right to begin construction even if there is a crop already in the ground. This makes it in a farmland owner’s best interest to have this issue addressed up front. These damages will often be calculated my multiplying the number of acres by the average county yield for that crop by that crop’s commodity future price with the Chicago Board of Trade for a given date. This provides an objective calculation for damages.
Verbal promises. A note of caution: if the solar energy developer makes you a verbal promise, ask for that promise to be included in the written lease. If there is a conflict between what a representative of the solar energy developer tells you and what is written in the lease, the terms in the written lease are likely to prevail.
The activity we are seeing across Ohio right now with solar reminds us of the early stages of the recent wind and shale energy booms. Some of the biggest regrets that we hear about are from landowners who thought they were getting a better deal than they actually did. Reading through, understanding, and thinking about the lease is an essential part of calculating whether or not the lease being offered is actually a good deal for a farmland owner and his or her family. Don’t be afraid to reach out to your team of professionals in this process. Your attorney, tax professional, extension educator, and others can be a great resource.