Environmental

Lake Erie once again made headlines when the Ohio Supreme Court recently decided that a “Lake Erie Bill of Rights” (LEBOR) initiative could be placed on the Toledo ballot on February 26, 2019.  The decision raised alarm in Ohio’s agricultural community and fears that, if passed, the measure will result in litigation for farmers in the Lake Erie watershed.

The OSU Extension Agricultural and Resource Law Program took a close look at LEBOR.  Specifically, we wanted to know:

• What does Toledo’s Lake Erie Bill of Rights petition mean?
• What does the petition language say?
• What happened in the legal challenges to keep the petition off the ballot?
• Have similar efforts been successful, and if not, why not?
• Who has rights in Lake Erie?
• What rights do business entities have?

We examine all of these questions, plus a number of frequently asked questions, in a new format called “In the Weeds.”  While many of our readers know of our blog posts and law bulletins, explaining this issue required something different.  Using “In the Weeds” is a way for us to dig into a current legal issue more in depth.

For answers to the questions above and more, CLICK HERE to view the new “In the Weeds: The Lake Erie Bill of Rights Ballot Initiative.”

We are full steam ahead in 2019, and so far we have held to our new year’s resolutions.  However, we want to take a quick look in the rearview mirror.  Ohio legislators passed a number of bills in 2018 that affect Ohio agriculture.  They range from multi-parcel auction laws to broadband grants, and oil & gas tax exemptions to hunting licenses.  Here are some highlights of bills that the Ohio General Assembly passed and former Governor Kasich signed in 2018.

• House Bill 500, titled “Change township law.”  As mentioned in a previous blog post, the Ohio General Assembly made a number of generally minor changes to Ohio’s township laws with House Bill 500.  The changes included, among other things, requiring a board of township trustees to select a chairperson annually, modifying how vacating township roads and name changes are carried out, allowing fees for appealing a zoning board decision, clarifying how a board can suspend a member of a zoning commission or board of appeals, and removing the requirement for limited home rule townships to submit a zoning amendment or resolution to a planning commission.  To learn about more of the changes that were made, visit the Ohio General Assembly’s H.B. 500 webpage here.
• House Bill 480, titled “Establish requirements for multi-parcel auctions.”  The Ohio Department of Agriculture regulates auctions, and H.B. 480 gave ODA authority to regulate a new classification of auctions: the multi-parcel auction.  Revised Code § 4707.01(Q) will define these as “any auction of real or personal property in which multiple parcels or lots are offered for sale in various amalgamations, including as individual parcels or lots, combinations of parcels or lots, and all parcels or lots as a whole.”  For more information, visit the Ohio General Assembly’s H.B. 480 webpage here.
• House Bill 522, titled “Allow outdoor refreshment area to include F permit holders.”  A municipality or township may create a “designated outdoor refreshment area” where people may walk around the area with their opened beer or liquor.  Previously, only holders of certain D-class permits (bars, restaurants, and clubs) and A-class permits (alcohol manufacturers) could allow their patrons to partake in a designated open area.  H.B. 522 will allow holders of an F-class liquor permit to also allow their patrons to roam in the designated area with an open container.  F-class liquor permits are for festival-type events of a short duration.  However, holders of either permits D-6 (allowing Sunday sales) or D-8 (allowing sales of growlers of beer or of tasting samples) will no longer be eligible for the open container exception.  For more information, visit the Ohio General Assembly’s H.B. 522 webpage, here.
• Senate Bill 51, titled “Facilitate Lake Erie shoreline improvement.”  As mentioned in a previous blog post, the primary purpose of Senate Bill 51 was to add projects for Lake Erie shoreline improvement to the list of public improvements that may be financed by a special improvement district.  S.B. 51 also instructed the Ohio Department of Agriculture (“ODA”) to establish programs to assist in phosphorous reduction in the Western Lake Erie Basin.  This adds to the previous instructions given to ODA in S.B. 299 regarding the Soil and Water Phosphorous Program.  S.B. 51 further provided funding for a number of projects, ranging from flood mitigation to MLS stadium construction.  For more information, visit the Ohio General Assembly’s S.B. 51 webpage here.
• Senate Bill 299, titled “Finance projects for protection of Lake Erie and its basin.”  Largely an appropriations bill to fund projects, S.B. 299 primarily targeted water quality projects and research.  ODA received an additional $3.5 million to support county soil and water conservation districts in the Western Lake Erie Basin, plus $20 million to establish water quality programs under a Soil and Water Phosphorous Program.  Further, the Ohio Department of Natural Resources (“ODNR”) received an additional $10 million to support projects that divert dredging materials from Lake Erie.  Stone Laboratory, a sea grant research program, received an additional $2.65 million.  The bill also created a mentorship program called OhioCorps, and set aside money for grants to promote broadband internet access.  For more information, visit the Ohio General Assembly’s S.B. 299 webpage here.
• Senate Bill 257, titled “Changes to hunting and fishing laws.”  ODNR may now offer multi-year and lifetime hunting and fishing licenses to Ohio residents under S.B. 257.  Further, the bill creates a resident apprentice senior hunting license and an apprentice senior fur taker permit, and removes the statutory limits on the number of these permits a person may purchase.  The bill also creates a permit for a Lake Erie Sport Fishing District, which may be issued to nonresidents to fish in the portions of Lake Erie and connected waters under Ohio’s control.  For more information, visit the Ohio General Assembly’s S.B. 257 webpage here.
• House Bill 225, titled “Regards plugging idle or orphaned wells.”  H.B. 225 creates a reporting system where a landowner may notify ODNR’s Division of Oil and Gas Resources about idle and orphaned oil or gas wells.  Upon notification, the Division must inspect the well within 30 days.  After the inspection, the Division must determine the priority for plugging the well, and may contract with a third party to plug the well.  To fund this, the bill increases appropriations to the Oil and Gas Well Fund, and increases the portion of the fund that must go to plugging oil and gas wells.  For more information, visit the Ohio General Assembly’s H.B. 225 webpage here.
• House Bill 430, titled “Expand sales tax exemption for oil and gas production property.”  Certain goods and services directly used for oil and gas production have been exempted from sales and use taxes, and H.B. 430 clarifies what does and does not qualify for the exemption.  Additionally, property used to control water pollution may qualify for the property, sales, and use tax exemptions if approved by ODNR as a qualifying property.  H.B. 430 also extends the moratorium on licenses and transfers of licenses for fireworks manufacturers and wholesalers.  For more information, visit the Ohio General Assembly’s H.B. 430 webpage here.
• Senate Bill 229, titled “Modify Board of Pharmacy and controlled substances laws.”  The Farm Bill’s opening the door for industrial hemp at the federal level has led to a lot of conversations about controlled substances, which we addressed in a previous blog post.  Once its changes take effect, Ohio’s S.B. 229 will remove the controlled substances schedules from the Ohio Revised Code, which involve the well-known numbering system of schedules I, II, III, IV, and V.  Instead, the Ohio Board of Pharmacy will have rulemaking authority to create schedules and classify drugs and compounds.  Prior to the removal of the schedules from the Revised Code, the Board of Pharmacy must create the new schedules by rule.  S.B. 229 also mentions cannabidiols, and lists them as schedule V under the current system if the specific cannabidiol drug has approval from the Food and Drug Administration.  For more information, visit the Ohio General Assembly’s S.B. 229 webpage here.

The end of 2018 effectively marked the end of the 132nd Ohio General Assembly, and 2019 marks the start of the 133rd Ohio General Assembly.  Any pending bills from the 132nd General Assembly that were not passed will have to be reintroduced if legislators wish to proceed with those bills.  Stay tuned to the Ag Law Blog for legal updates affecting agriculture from the Ohio General Assembly.

The legislative Joint Committee on Agency Rule Review (JCARR) has voted  to send the "watersheds in distress" rule revisions back to the Ohio Department of Agriculture (ODA).   JCARR reviews administrative rules to make sure they follow legal requirements, which we explained in a previous blog post.   The "watersheds in distress" rules seek to address agricultural nutrient impacts on water quality, also explained in an earlier post.  At its meeting yesterday, JCARR members voted 8 to 1 to recommend that ODA revise and refile the rules for consideration at JCARR's next meeting on January 22, 2019. 

The January 22 meeting date efectively removes Governor Kasich's administration from the rules revision.  Kasich issued an executive order last July directing his agencies to prepare the controversial rule package.  But the incoming DeWine Administration will control the fate of the rules since DeWine takes office on January 14, 2019.    JCARR is apparently counting on the new administration to take a different approach on agricultural nutrient pollution reduction. 

"There will be a new administration and we'll have maybe more productive talks," stated JCARR's chair, Sen. Joe Uecker (R-Loveland).  "The DeWine Administration has demonstrated an interest on working with stakeholders on this issue." 

The lack of stakeholder involvement was a common concern voiced by JCARR members, who stated that the rules had been rushed and did not involve all of the interested parties.  Several committee members also suggested that the rules are inconsistent with legislative intent and will have a significant adverse impact on farmers.  The Ohio Soybean Association, Ohio Corn & Wheat Growers Association, and Ohio Farm Bureau echoed those criticisms to JCARR members while several local residents, local groups and the Ohio Environmental Council testified that the rules would not sufficiently protect water quality.

If ODA fails to refile the rules proposal for the January meeting, JCARR will have 31 days to recomend that the Ohio General Assembly invalidate the rules.  That action would allow each chamber five days to pass a resolution invalidating the rules; if the concurrent resolution does not pass within that time period, the rules would stand.  Alternatively, ODA could remove the proposal from JCARR's agenda and refile revised rules at a later date, a likely course of action for the incoming DeWine administration. 

Read the minutes of the December 10, 2018 JCARR meeting, which will be posted here.  The proposed rules are here and here.

Written by Ellen Essman, Sr. Research Associate

Over the last several months, three nuisance cases have been decided against Smithfield Foods in federal court in North Carolina.  The juries in the cases have found Smithfield’s large farms, with thousands of hogs, and the odor, traffic, and flies that come along with them, to be a nuisance to neighboring landowners.  Smithfield has been ordered to pay hefty damages to the neighbors, and more cases against the company remain to be decided.  Given the outcomes of the cases that have been decided thus far, farmers and landowners in Ohio might be wondering how Ohio law compares to North Carolina law as pertains to agricultural nuisances.

Ohio’s Right-to-Farm law

Many states, including both Ohio and North Carolina, have “right-to-farm” legislation, which in part is meant to protect agriculture from nuisance lawsuits such as those filed against Smithfield.  While nearly every state has a right-to-farm statute, they do differ in language and how they go about protecting agriculture. 

Ohio farmers have right-to-farm protection in two parts of the Revised Code.  ORC Chapter 929 establishes “agricultural districts.”  Generally, in order to place land in an agricultural district, the owner of the land must file an application with the county auditor.  Certain requirements must be met in order for an application to be accepted.  Slightly different rules apply if the land in question is within a municipal corporation or is being annexed by a municipality.  If the application is accepted, the land is placed in an agricultural district for five years.  The owner may submit a renewal application after that time is up.

Being part of an agricultural district in Ohio can help farmers and landowners to defend against civil lawsuits.  ORC 929.04 reads:

In a civil action for nuisances involving agricultural activities, it is a complete defense if:

• The agricultural activities were conducted within an agricultural district;
• Agricultural activities were established within the agricultural district prior to the plaintiff’s activities or interest on which the action is based;
• The plaintiff was not involved in agricultural production; and
• The agricultural activities were not in conflict with federal, state, and local laws and rules relating to the alleged nuisance or were conducted in accordance with generally accepted agriculture practices. 

The ORC’s chapter on nuisances provides additional protection for those “engaged in agriculture-related activities.”  Under ORC 3767.13, people who are practicing agricultural activities “outside a municipal corporation, in accordance with generally accepted agricultural practices, and in such a manner so as not to have a substantial, adverse effect on public health, safety, or welfare” are typically exempt from claims of nuisance due to farm noise, smells, etc.

North Carolina’s Right-to-Farm law

Much like Ohio, North Carolina farm land can be part of an “agricultural district.” North Carolina’s preservation of farmland law is available here.  This program is meant to protect agricultural land—land that is part of an agricultural district is must be used for agriculture for at least 10 years.  However, unlike Ohio’s law, North Carolina does not specifically spell out that land in agricultural districts will be protected from nuisance suits when the landowner follows the rules of the agricultural district.  North Carolina’s law does state that one of the purposes of agricultural districts is to “increase protection from nuisance suits and other negative impacts on properly managed farms,” but unlike Ohio, it does not explicitly state that being part of an agricultural district is a defense to a nuisance lawsuit. 

North Carolina also has a statute which specifically spells out the right-to-farm.  In response to the recent jury decisions, however, North Carolina has changed its right-to-farm law.  The original law read:

1. No agricultural or forestry operation or any of its appurtenances shall be or become a nuisance, private or public, by any changed conditions in or about the locality outside of the operation after the operation has been in operation for more than one year, when such an operation was not a nuisance at the time the operation began.

(a1) The provisions of subsection (a) of this section shall not apply when the plaintiff demonstrates that the agricultural or forestry operation has undergone a fundamental change.  A fundamental change does not include any of the following:

1. A change in ownership or size.
2. An interruption of farming for a period of no more than three years.
3. Participation in a government-sponsored agricultural program.
4. Employment of new technology.
5. A change in the type of agricultural or forestry product produced.

The original law did not protect agricultural operations if their actions were negligent or improper.  The original law is available here.

Following the first decision against Smithfield, the North Carolina legislature overrode the Governor’s veto to implement amendments to the state’s right-to-farm law.  In the amendments, available here (sections 106-701 and 106-702), the legislature substantially changed the language of the law, making what constitutes a nuisance much more explicit and dependent on certain factors.  What is more, the new version of the law places limits on when plaintiffs can recover punitive damages for a private nuisance action.  

A comparison of the Ohio and North Carolina’s sections of legislation promoting the “right-to-farm” shows how different the two states are.  Ohio’s legislative language makes it obvious that the meaning of the law is to protect agriculture from nuisance suits—by specifically stating that being in an agricultural district is a complete defense to nuisance, and that otherwise, agriculture is generally exempt from nuisance suits.  North Carolina’s law concerning agricultural districts does not specifically state that being in such a district is a defense to nuisance, instead, it simply expresses the hope that districts will “increase protection from nuisance suits.”  Furthermore, while North Carolina’s original right-to-farm law stated that agricultural operations do not “become a nuisance” due to changed conditions in the community, that language is not very specific.  Ohio’s agricultural district language lays out exactly what must be done to have a complete defense against a nuisance lawsuit; North Carolina’s language in multiple parts of the General Statutes does not have the same degree of specificity.

Permit as a defense to nuisance

In addition to the right-to-farm law, under ORC 903.13, those owning, operating, or responsible for concentrated animal feeding facilities in Ohio have an affirmative defense to a private civil action for nuisance against them if the CAFO is in compliance with best management practices established in the installation permit or permit to operate and the agricultural activities do not violate federal, state, and local laws governing nuisances.  North Carolina does not appear to have similar language protecting permitted farms in its General Statutes. 

Other factors that may come into play

In the lawsuits against Smithfield farms, the lawyers for the plaintiffs (neighboring landowners) have continuously asserted that Smithfield has “means and ability” to “reduce the nuisance from existing facilities” by ending the use of “lagoon and sprayfield” systems at their farms.  Plaintiffs stress that not only is Smithfield Foods, Inc. a large, wealthy, multinational company, but that they have also changed their lagoon and sprayfield practices outside of North Carolina.  In lagoon and sprayfield systems, all waste is collected in an open-air lagoon and then sprayed on fields as fertilizer.  The practice was first banned for new construction in North Carolina in 1997, and in 2007, the state permanently banned the practice for newly constructed swine facilities.  Although many of the facilities in question were opened before any ban on the construction of lagoon and sprayfield facilities, the plaintiffs contend that changes made in other states mean Smithfield can afford to change in North Carolina.  The ban on new lagoon and sprayfield systems in North Carolina, and evidence that Smithfield has used different practices to reduce the smell from the farms in other states, likely helped the juries in the cases that have been tried to date find that the farms are a nuisance to their neighbors. The above argument is something operators of livestock facilities in Ohio should be aware of.  Although Ohio has not specifically banned lagoon and sprayfield systems like North Carolina has, the ability to change the system could still potentially be used to argue nuisance.  Ohio operators are supposed to follow best management practices and the Natural Resources Conservation Service’s Field Office Technical guide when applying and storing manure, which include ways to reduce odor from manure and other applications, as well as reducing other types of nutrient pollution.  Following such guidelines would likely help operators in any argument against nuisance.