Food

Flyer for Food Business Central course with photo of female baker and link to course
By: Peggy Kirk Hall, Friday, February 23rd, 2024

Are you a baker ready to sell your home-baked goods? Are you a farmer looking for value-added opportunities for crops you’ve grown or livestock you've raised? Are you an entrepreneur aiming to use local agricultural products to make value-added foods?

If you’ve answered yes to any of these questions, then the new Food Business Central online course can equip you with knowledge and strategies to launch a successful farm-raised or home-based food business in Ohio.

Navigating food regulations, establishing a new business, and applying best practices for food safety can be challenges for food entrepreneurs. This course is designed to serve as a centralized hub to connect you to information and resources regarding all types of food products you might want to make and sell.

We're part of the teaching team that created the course, which also includes Emily Marrison, OSU Family & Consumer Sciences Educator, Nicole Arnold, OSU Food Safety State Specialist,and Garth Ruff, OSU Field Specialist in Beef Cattle and Livestock Marketing. Our goal is to help food business entrepreneurs start off organized, safe, compliant, and strategic. The self-paced course asks key questions with considerations to explore and actions to take on your journey to start a food business. The cost of the course is $25, and registration is at go.osu.edu/foodbusinesscentral .

The  Food Business Central online course was partly funded through North Central Extension Risk Management Education, whose goal is to help farmers and ranchers effectively manage risk in their operations. This assistance comes from the United States Department of Agriculture through the National Institute of Food and Agriculture.

 

Calf standing in the snow
By: Jeffrey K. Lewis, Esq., Tuesday, January 30th, 2024

Happy 2024! We hope your new calendar year has gotten off to a delightful start. As we close out the first of twelve months, we bring you another edition of the Ag Law Harvest. In this blog post, we delve into the intricate world of employment contracts and noncompete agreements, classifying workers as independent contractors or employees, Ag-Gag laws, and agricultural policy. 

Ohio Man Violates Employer’s Noncompete Agreement. 
Kevin Ciptak (“Ciptak”), an Ohio landscaping employee, is facing legal trouble for allegedly breaching his employment contract with Yagour Group LLC, operating as Perfection Landscapes (“Perfection”). The contract included a noncompete agreement, which Ciptak is accused of violating by running his own landscaping business on the side while working for Perfection. Perfection eventually discovered the extent of Ciptak’s side business, leading to Perfection filing a lawsuit.

During the trial, Ciptak testified that Perfection was “too busy” to take on the jobs he completed. Additionally, Ciptak stated that the profits from his side jobs amounted to over $60,000. Perfection countered that they would have been able to perform the work and, because of the obvious breach of the noncompete agreement, Perfection lost out on the potential profits. The trial court ruled in favor of Perfection, ordering Ciptak to pay the $60,000 in profits along with attorney's fees and expenses, exceeding $80,000. Ciptak appealed, arguing that, according to Ohio law, Perfection could only recover its own lost profits, not Ciptak's gains from the breach. He also claimed that Perfection was not harmed as they were "too busy," and Perfection failed to provide evidence of lost profits. 

The Eighth District Court of Appeals ultimately found in favor of Perfection.  The court reasoned that “[t]his case came down to a credibility determination.” The court held there was no dispute that Ciptak had violated the noncompete agreement. What was in dispute was whether Perfection could have and would have performed the work. The Eighth District held that the trial court’s finding that Perfection could have performed the work was not unreasonable. The Eighth District noted that although Ciptak claimed that Perfection was “too busy” to do any of those jobs, Ciptak “provided no other evidence to support this assertion.” The Eighth District ruled that the evidence presented at trial showed that Perfection would have realized approximately the same amount of profit on those jobs as Ciptak did and, therefore, Perfection was damaged as a result of Ciptak’s breach of the noncompete agreement. 

New Independent Contractor Rule Announced by Department of Labor. 
The U.S. Department of Labor (“DOL”) has published a final rule to help employers better understand when a worker qualifies as an employee and when they may be considered an independent contractor. The new rule gets rid of and replaces the 2021 rule. As announced by the DOL, the new rule “restores the multifactor analysis used by courts for decades, ensuring that all relevant factors are analyzed to determine whether a worker is an employee or an independent contractor.” Thus, the new rule returns to a “totality of the circumstances” approach and analyzes the following six factors: (1) any opportunity for profit or loss a worker might have; (2) the financial stake and nature of any resources a worker has invested in the work; (3) the degree of permanence of the work relationship; (4) the degree of control an employer has over the person’s work; (5) whether the work the person does is essential to the employer’s business; and (6) the worker’s skill and initiative. The new rule goes into effect on March 11, 2024. 

Federal Appeals Court Reverses Injunctions on Iowa “Ag-Gag Laws.” 
On January 8, 2024, the U.S. Court of Appeals for the Eighth Circuit issued two opinions reversing injunctions against two Iowa “ag-gag laws”. At trial, the two laws were found to have violated the First Amendment of the United States Constitution. In its first opinion, the Eighth Circuit Court of Appeals analyzed Iowa’s “Agricultural Production Facility Trespass” law which makes it illegal to use deceptive practices to obtain access or employment in an “agricultural production facility, with the intent to cause physical or economic harm or other injury to the agricultural production facility’s operations . . .” The Eighth Circuit found that the intent element contained within the Iowa law prevents it from violating the First Amendment. The court reasoned that the Iowa law “is not a viewpoint-based restriction on speech, but rather a permissible restriction on intentionally false speech undertaken to accomplish a legally cognizable harm.” 

In its second opinion, the Eighth Circuit reviewed an Iowa law that penalized anyone who “while trespassing, ‘knowingly places or uses a camera or electronic surveillance device that transmits or records images or data while the device is on the trespassed property[.]’” The court found that the Iowa law did not violate the First Amendment because “the [law’s] restrictions on the use of a camera only apply to situations when there has first been an unlawful trespass, the [law] does not burden substantially more speech than is necessary to further the State’s legitimate interests.”  The court noted that Iowa has a strong interest in protecting property rights by “penalizing that subset of trespassers who – by using a camera while trespassing – cause further injury to privacy and property rights.” 

Both cases have been remanded to the trial courts for further proceedings consistent with the forgoing opinions. 

USDA Announces New Remote Beef Grading Program.
Earlier this month, the U.S. Department of Agriculture (“USDA”) announced a new pilot program to “allow more cattle producers and meat processors to access better markets through the [USDA’s] official beef quality grading and certification.” The “Remote Grading Pilot for Beef” looks to expand on the USDA’s approach to increase competition in agricultural markets for small- and mid-size farmers and ranchers. The pilot program hopes to cut expenses that otherwise deter small, independent meat processors from having a highly trained USDA grader visit their facility. 

Under the pilot program, trained plant employees capture specific images of the live animal and the beef carcass. These images are then sent to a USDA grader that will inspect the images and accompanying plant records and product data, who then assigns the USDA Quality Grade and applicable carcass certification programs. The “Remote Grading Pilot for Beef” is only available to domestic beef slaughter facilities operating under federal inspection and producing product that meets USDA grading program eligibility criteria. More information can be found at https://www.ams.usda.gov/services/remote-beef-grading

USDA Accepting Applications for Value-Added Producer Grants Program. 
On January 17, 2024, the U.S. Department of Agriculture (“USDA”) announced that it is “accepting applications for grants to help agricultural producers maximize the value of their products and venture into new and better markets.” These grants are available through the Value-Added Producer Grants Program. Independent producers, agricultural producer groups, farmer or rancher cooperatives, and majority-controlled producer-based business ventures are all eligible for the grants. The USDA may award up to $75,000 for planning activities or up to $250,000 for working capital expenses related to producing and marketing a value-added agricultural product. For more information, visit the USDA’s website or contact your local USDA Rural Development office.

 

 Ohio Senate chambers at the Statehouse in Columbus Ohio
By: Peggy Kirk Hall, Tuesday, December 12th, 2023

The holiday season isn't distracting the Senate Agriculture and Natural Resources Committee from considering three legislative proposals concerning scenic rivers, small beer brewers, and state agriculture day designations.  On December 12, the committee will hear testimony on all three bills.  Here’s a summary of the proposals.

S.B. 156 - Designation of wild, scenic, and recreational rivers.  Senators Bill Reineke (R-Tiffin) and Bob Hackett (R-London) introduced this legislation to revise portions of the Ohio Scenic Rivers Program that were raising concerns from private property owners.  The committee will hold its fourth hearing on the bill on December 12.  The proposal makes the following changes to the Ohio Scenic River Law:

  • Clarifies that the designation of a Wild, Scenic or Recreational River does not grant authority to oversee private activities on private property or enter private land within the river area to the Ohio Department of Natural Resources (ODNR), which administers the program. 
  • States that the agency has management and oversight of lands along a designated river only for those lands the state owns.
  • Requires ODNR to adopt rules to govern the use, visitation, and protection of scenic river lands and to establish facilities and improvements within the areas necessary for visitation, use, restoration, and protection of the lands.
  • Clarifies that certain public entities must obtain approval from the ODNR Director to perform certain construction activities within 1,000 feet of a wild, scenic, or recreational river. 
  • Extends the public comment period following the announcement of intent to designate a new river from 30 days to 60 days.

S.B. 138 – Alcohol Franchise Law exemption for small brewers.  This bill introduced by Senator Andrew Brenner (R-Delaware) aims to help small brewers who annually manufacture less than 250,000 barrels (7.75 million gallons) of beer.  The bill exempts small brewers from Ohio’s Alcohol Franchise Law, which requires a beer or wine manufacturer to enter into a franchise agreement with a distributor and lays out requirements for the franchise agreement.  The exemption would allow small brewers to establish agreements with distributors under their own negotiated terms rather than the state-required terms.  S.B. 138 will see its second committee hearing on December 12.

H.B. 162 – Agriculture Appreciation Act.  The House of Representatives passed H.B. 162 in October, and it will have its  second hearing on December 12.  Proposed by Reps. Roy Klopfenstein (R-Haviland) and Darrell Kick (R-Loudonville), the bill designates the following federal agriculture days as state days in Ohio:

  • March 21 of each year as “Agriculture day”;
  • The week beginning on the Saturday before the last Saturday of each February through the last Saturday in February as "FFA Week";
  • October 12 of each year as “Farmer’s Day”;
  • The week ending with the second Saturday of March as “4-H Week.”

Keep up with the Senate Agriculture and Natural Resources Committee’s activity on the Ohio Senate’s website at https://ohiosenate.gov/committees/agriculture-and-natural-resources

By: Peggy Kirk Hall, Tuesday, August 22nd, 2023

The summertime slowdown hasn't affected the number of agricultural law questions we've received from across Ohio.  Here's a sampling of recent questions and answers:

Is a tree service business considered “agriculture” for purposes of Ohio rural zoning?

No, tree trimming and tree cutting activities are not listed in the definition of agriculture in Ohio’s rural zoning laws, although the definition does include the growing of timber and ornamental trees. The definition ties to the “agricultural exemption” and activities that are in the “agriculture” definition can be exempt from county and township zoning.  Here is the definition, from Ohio Revised Code sections 303.01 and 519.01:

"agriculture" includes farming; ranching; algaculture meaning the farming of algae; aquaculture; apiculture; horticulture; viticulture; animal husbandry, including, but not limited to, the care and raising of livestock, equine, and fur-bearing animals; poultry husbandry and the production of poultry and poultry products; dairy production; the production of field crops, tobacco, fruits, vegetables, nursery stock, ornamental shrubs, ornamental trees, flowers, sod, or mushrooms; timber; pasturage; any combination of the foregoing; and the processing, drying, storage, and marketing of agricultural products when those activities are conducted in conjunction with, but are secondary to, such husbandry or production.

What are the benefits of being enrolled in the “agricultural district program” in Ohio, and is there a penalty for withdrawing from the program?

There are three benefits to enrolling farmland in the agricultural district program:

  1. The first is the nuisance protection it offers a landowner.  A landowner can use the defense the law provides if a neighbor who moves in after the farm was established files a lawsuit claiming the farm is a “nuisance” due to noise, odors, dust, etc.  Successfully raising the defense and showing that the farm meets the legal requirements for being agricultural district land would cause the lawsuit to be dismissed.  
  2. The second benefit is that the law also exempts agricultural district land from assessments for water, sewer and electric line service extensions that would cross the land.  As long as the land remains in agricultural district program, the landowner would not be subject to the assessments.  But if the land is changed to another use or the landowner withdraws the land from the agricultural district program, assessments would be due.  The assessment exemption does not apply to a homestead on the farmland, however.
  3. A third benefit of the agricultural district program law is that it requires an evaluation at the state level if agricultural district land is subject to an eminent domain action that would affect at least 10 acres or 10% of the land.  In that case, the Director of the Ohio Department of Agriculture must be notified of the eminent domain project and must assess the situation to determine the effect of the eminent domain on agricultural production and program policies.  Both the Director and the Governor may take actions if the eminent domain would create an unreasonably adverse effect.

As for the question about a withdrawal penalty, the law does allow the county to assess a penalty when a landowner withdraws land from the agricultural district program during the agricultural district enrollment period, which is a five-year period.  If a landowner removes the land from the agricultural district, converts the land to a purpose other than agricultural production or an agricultural conservation program, or sells the land to another landowner who does not elect to continue in the agricultural district program, the landowner must pay a withdrawal penalty.  The amount of the penalty depends on whether the land is also enrolled in the Current Agricultural Use Value program.  See the different penalty calculations in Ohio Revised Code 929.02(D(1).

Read the agricultural district program law in Chapter 929 of the Ohio Revised Code and contact your county auditor to learn about how to enroll in the program.

My farmland is within the village limits and the village sent me a notice that I must cut a strip of tall grass on my land.  Do I have to comply with this?

Yes.  Ohio law allows a municipality such as a village to have vegetation, litter, and “noxious weeds” laws.  These laws can set a maximum limit for the height of grass, require removal of litter on the property, and require ridding the land of “noxious weeds.”  The purpose of the laws is to protect property values, protect public health by preventing pests and nuisances from accumulating, and keep noxious weeds from spreading to other properties.  The village is within its legal authority to enforce its grass, litter, and noxious weeds laws on a farm property that is within the village limits. Failing to comply with an order by the village can result in a fine or  financial responsibility for all expenses incurred by the village to remedy the problem.

Is it legal to pull water from a river or stream to irrigate land in Ohio?

Yes, as long as the withdrawal occurs on private land or with the consent of the public or private landowner.  Registration with the Ohio Department of Natural Resources is required, however, if the amount withdrawn exceeds 100,000 gallons per day.  If the withdrawal is within an established "groundwater stress area," ODNR has the authority to reduce the amount of a withdrawal.  Withdrawal registration information is available on the Division of Water Resources website

Note that according to Ohio’s “reasonable use” doctrine, if a water withdrawal causes “unreasonable” harm to other water users, a legal action by harmed users could stop or curtail the use or allocate liability for the harm to the person who withdrew the water.  To avoid such problems, a person withdrawing the water should ensure that the withdrawal will not cause “unreasonable” downstream effects.

An urban farmer wants to build a rooftop greenhouse to grow hemp and then wants to make and sell cannabis-infused prepared foods at a market on her property.  Who regulates this industry and where would she go for guidance on legal and regulatory issues for these products?

Regulation and oversight of food products that contain cannabis is a combination of federal and state authority.  Federal regulation is through the U.S. Food and Drug Administration and state regulation is via the Ohio Department of Agriculture’s Food Safety Division.  She should refer to these resources:

As for the growing of hemp, the Ohio Department of Agriculture (ODA) regulates indoor hemp production in Ohio.  There is a minimum acreage requirement for indoor production—she must have at least 1,000 square feet and 1,000 plants.  See these resources from ODA:

Zucchini and yellow squash in a wooden box
By: Peggy Kirk Hall, Wednesday, July 26th, 2023

It’s the time of year when many Ohio vegetable gardeners are wondering, “why in the world did I plant so many zucchini?”  And it’s also when we start hearing the question, “is there any liability risk in giving away my garden produce?”  The good news is that Ohio has a food donation immunity law.  The law encourages food donations by granting liability protection to those who give perishable foods like garden produce to agencies that serve individuals in need.  A new amendment to the law recently passed in Senate Bill 16 broadens the types of donations that qualify for liability protection.  If you’re up to your ears in garden produce, you may want to know about the food donation immunity law.

Here's how the law works.

  1. The grant of immunity

The food donation immunity law is in Ohio Revised Code 2305.37.  It states in Section B that a person who, “in good faith,” donates “perishable food” to an “agency” is not liable for harm that may arise if the food, when distributed to an “individual in need,” is not “fit for human consumption.” 

  1. The donation must be made “in good faith” that the food is “fit for human consumption” when donated

There is not a definition for the term “in good faith,” but it’s a term commonly used in legal situations.  It means that a person acted with an “honest intent” and not with an intent to deceive or conceal something. The food donation immunity law provides two conditions to help ensure a person is donating in good faith.  First, the immunity only applies if a person determines, prior to making a donation, that the food is “fit for human consumption” at the time it is donated to an agency.  The term “fit for human consumption,” though not defined by this law, means that it is edible and safe.  But note there is no responsibility on the donor to ensure the food will be edible and safe after it is donated, when it is actually consumed or distributed.  Second, when determining whether food is fit for consumption, a donor cannot act with gross negligence or willful or wanton misconduct.  These two conditions mean that if a donor doesn’t inspect the food at all before delivery or knows something happened to the food that could make it unsafe for consumption but donates it anyway, the law will not protect the donor from liability if the food causes harm. 

  1. The law applies to “perishable food”

The law’s definition of “perishable food” is broad.  It refers to any food that may spoil or otherwise become unfit for human consumption due to its nature, age, or physical condition.  The definition includes fresh fruits and vegetables, fresh and processed meats, poultry, fish, seafood, dairy products, bakery products, eggs, refrigerated and frozen foods, and packaged foods.  It also includes food prepared but not served by a food service operation such as a restaurant, caterer, or hotel, and gleaned foods, discussed below.

  1. Donations must be to “agencies” that serve “individuals in need”

Donations to friends and family don’t qualify for the liability protection—the law only applies to a donation to an “agency” that serves “individuals in need.”  Several definitions and conditions are important.

  • An “agency” is an organization that distributes perishable food to “individuals in need,” either directly or indirectly. The term includes any nonhospital, charitable nonprofit corporation organized under Ohio nonprofit laws, or nonprofit charitable association, group, institution, organization, or society.  An “individual in need” is a person an agency determines to be eligible for food distribution due to poverty, illness, disability, infancy, or similar circumstances.
  • A qualifying agency is one that does not charge a fee for the food.  However, Senate Bill 16 recently amended the law to allow donations to an agency that charges an amount no more than the cost of handling the food.  That change means even if individuals pay a food handling cost to receive the donated food, the donor of the food will receive immunity.
  • Another section of the law, 2305.37(D), also grants immunity to an agency that distributes donated food as long as the agency determines the food is fit for human consumption when the food distribution occurs.

Ohio law also provides liability protection for “gleaning”

Growers can also be immune from liability when allowing someone else to pick or salvage the garden produce and donate it to an agency.  This is referred to as "food gleaning" and Ohio law also provides liability protection to those who allow food gleaning.  First, the gleaned food is considered “perishable food” and is covered by the food donation immunity law described above.  Second, the food gleaning immunity law in Ohio Revised Code 2305.35 grants a landowner or operator immunity for physical injuries sustained by a gleaner during the gleaning process. The landowner or operator is not liable for injuries to a gleaner resulting from any risks or conditions of the property or any normal agricultural operations on the property.

Ready to donate?

Gardeners ready to donate excess garden produce first need to locate an agency that serves individuals in need.  Find a local food bank, food pantry, soup kitchen, meals on wheels, or similar agency, and make sure the agency doesn’t charge individuals to receive the food or charges no more than the cost of handling the food.  These resources can help locate an agency: 

Before delivering garden produce to tan agency, be sure to inspect the produce and ensure it is fit for consumption—clean, not spoiled, and edible.  Don’t have time to pick and deliver?  Find a food gleaner who may be willing to glean your garden and donate the food to an agency.  Here’s a resource that lists Ohio food gleaners:  https://nationalgleaningproject.org/gleaning-map/states/ohio/?fwp_state=oh.

Baby chick in a laboratory flask.
By: Jeffrey K. Lewis, Esq., Friday, June 30th, 2023

Happy last day of June! We close out the month with another Ag Law Harvest, which brings you two interesting court cases, one about an Ohio man asserting his right to give away free gravel, and another which could decide the constitutionality of “Ag-Gag” laws once and for all. We also provide a few federal policy updates and announcements. 

Ohio Department of Agriculture Prohibited from Fining a Landowner for Charging to Load Free Gravel.  In May of 2020, Paul Gross began selling gravel and topsoil (collectively “gravel”) that he had accumulated from excavating a pond on his property. Gross charged $5 per ton of gravel, which was weighed at a scale three miles from his property. After receiving a complaint of the gravel sales, the Madison County Auditor sent a Weights and Measures Inspector to investigate Gross’s gravel sales. The Inspector informed Gross that the gravel sales violated Ohio Administrative Code 901:6-7-03(BB) (the “Rule”) because the gravel was not being weighed at the loading site. Under the Rule, “[s]and, rock, gravel, stone, paving stone, and similar materials kept, offered, or exposed for sale in bulk must be sold . . . by cubic meter or cubic yard or by weight.” As explained by the Inspector, Gross’s problem was that he was selling gravel by inaccurate weight measurements because the trucks hauling the gravel lose fuel weight when traveling the three miles to the scale. 

Instead of installing scales on his property, Gross decided to start giving away the gravel for free. However, Gross did charge a flat rate fee of $50 to any customer that requested Gross’s help in loading the gravel. According to Gross, this $50 fee was to cover the cost of his equipment, employees, and other resources used to help customers load the gravel. Unsatisfied with the structure of this transaction, the Ohio Department of Agriculture (“ODA”) decided to investigate further and eventually determined that even though Gross was giving away the gravel for free, the flat fee for Gross’s services represented a commercial sale of the gravel and, therefore, Gross was in continued violation of the Rule. 

For the alleged violation, the ODA intended to impose a $500 civil penalty on Gross, who requested an administrative hearing. The hearing officer recommended imposing the penalty and the Franklin County Court of Common Pleas agreed. Gross appealed the decision to the Tenth District Court of Appeals, which found that Gross was not in violation of the Rule

The Tenth District reasoned that customers were paying for the service of moving the gravel, not for the gravel itself. The court explained that the purpose of the Rule is to protect consumers by ensuring transparent pricing of materials like gravel. Since Gross was not in the business of selling gravel and the transaction was primarily for services, the court concluded that the ODA’s fine was impermissible. 

North Carolina Asks U.S. Supreme Court to Review “Ag-Gag Law.”  In 2015, the North Carolina Legislature passed the North Carolina Property Protection Act, allowing employers to sue any employee who “without authorization records images or sound occurring within” nonpublic areas of the employer’s property “and uses the recording to breach the [employee’s] duty of loyalty to the employer.” After the act’s passage several food-safety and animal-welfare groups, including the People for the Ethical Treatment of Animals (“PETA”), challenged the Property Protection Act in an effort to prevent North Carolina from enforcing the law. 

A federal district court in North Carolina struck down the law, finding it to be a content-based restriction on speech in violation of the First Amendment of the United States Constitution. The 4th Circuit Court of Appeals upheld the district court’s ruling also reasoning that the law’s broad prohibitions restrict speech in a manner inconsistent with the First Amendment. Now, the North Carolina Attorney General, Josh Stein, has petitioned the Supreme Court of the United States (“SCOTUS”), asking the Court to reverse the 4th Circuit’s decision. If SCOTUS decides to hear the case, the justices will be tasked with determining “[w]hether the First Amendment prohibits applying state tort law against double-agent employees who gather information, including by secretly recording, in the nonpublic areas of an employer’s property and who use that information to breach their duty of loyalty to the employer.” 

We have reported on several Ag-Gag laws and the court challenges that have followed. If SCOTUS decides to take up the case, we may finally have a definitive answer as to whether Ag-Gag laws are constitutional or not. 

Lab-grown Chicken Given the Green Light by the USDA. The United States Department of Agriculture’s (“USDA”) Food Safety and Inspection Service granted its first approvals to produce and sell lab-grown chicken to consumers. Upside Foods and Good Meat, the two entities given the green light by the USDA, plan on initially providing their “cell-cultivated” or “cultured” chicken to patrons of restaurants in the San Francisco and Washington D.C. areas. However, the timeline for such products showing up in your local grocery store has yet to be determined.  

USDA Suspends Livestock Risk Protection 60-Day Ownership Requirement. The USDA’s Risk Management Agency issued a bulletin suspending the 60-day ownership requirement for the Livestock Risk Protection (“LRP”) program. Normally under the LRP, covered livestock must be owned by the producer within the last 60 days of the specified coverage endorsement period for coverage to apply. According to the bulletin, “[d]ue to the continuing severe drought conditions impacting many parts of the nation, producers are struggling to find adequate supplies of feed or forage, causing them to market their livestock sooner than anticipated.” In response, the USDA is allowing producers to apply to waive the 60-day ownership requirement, subject to verification of proof of ownership of the livestock. The USDA hopes this waiver will allow producers to market their livestock as necessary while dealing with the current drought effects. Producers will be able to apply for the waiver until December 31, 2024. 

USDA Announces Tool to Help Small Businesses and Individuals Identify Contracting Opportunities. Earlier this month, the USDA announced a new tool “to assist industry and small disadvantaged entities in identifying potential opportunities for selling their products and services to USDA.” USDA’s Procurement Forecast tool lists potential contracting or subcontracting opportunities with the USDA. Until now, businesses could only access procurement opportunities through the federal-wide System for Award Management (“SAM”). The USDA hopes the Procurement Forecast tool will provide greater transparency and maximize opportunity for small and underserved businesses. 

 

Sow and pigs in farrowing pen
By: Peggy Kirk Hall, Tuesday, June 06th, 2023

We’ve heard from many concerned pork producers since the U.S. Supreme Court recently ruled on California's controversial animal housing law, Proposition 12 (“Prop 12”).  Enacted as a ballot measure by California voters, the law sets minimum space requirements for sows and prohibits the sale of pork derived from a sow raised in conditions that don't meet the housing standards.  But the California law has yet to go into effect due to a score of lawsuits challenging California's authority to make a state law that negatively affects hog producers in other states. On May 11, the Supreme Court made its decision on one such challenge--National Pork Producers Council v. Ross (“NPPC”).  The 5-4 ruling upholding Prop 12 was not the decision desired by agricultural interests, leading to the questions we've been receiving: is there still a way to prohibit the law?  When and how will California enforce the law?  Will pork producers now begin complying with Prop 12?

An understanding of the court’s reasoning in NPPC is necessary before we can answer these questions. Let’s begin with the following excellent explanation of the case by my colleague Elizabeth Rumley at the National Agricultural Law Center.

The Supreme Court's decision

After considering a constitutional challenge to a California ballot initiative regulating space requirements for farm animals, the Supreme Court of the United States (“SCOTUS”) ruled on May 11th in favor of the state of California, allowing the law to stand.  The proposal, known as “Prop 12,” set conditions on the sale of pork meat in California- regardless of where it was produced.  It required, among other things, that all products be from pigs born to a sow housed in at least 24 square feet of space.  This effectively imposed Prop 12’s animal housing standards on any producer, no matter the location, who wished to sell products to residents of California.  This part of the law was promptly challenged and eventually heard by the Supreme Court.

The case, National Pork Producers Council v. Ross (“NPPC”) considered whether Prop 12’s regulation of the out-of-state production of products to be sold within state boundaries is a permitted action under a legal doctrine known as the dormant Commerce Clause.  In other words, under what circumstances can a state government pass laws that primarily affect the actions of people in other states? SCOTUS agreed to consider the case, and oral arguments were heard last October.  Many of the arguments centered on whether the law met the provisions of the “Pike balancing test,” which compares local benefits of a law to the burden that it places on out-of-state commerce to determine if the burden is clearly excessive.

NPPC Ruling

While parts of this ruling were agreed upon by all justices, the foundational legal analysis was a split decision, with several justices agreeing and disagreeing as to various parts.  Ultimately, a plurality of the court held that Prop 12 was constitutional and enforceable by California.  A minority of justices would have sent the case back to the district court for further consideration.  The opinion of the Court (joined by the largest number of justices), was written by Justice Gorsuch.

In the initial, unanimously agreed upon, sections of the opinion, Gorsuch focuses on the “antidiscrimination principle” that “lies at the ‘very core’” of dormant commerce clause jurisprudence.  In the clearest situations, this happens if a state set different standards for out-of-state businesses vs in-state businesses (for example, if Prop 12 had required Kansas producers to give pigs more space, but allowed California producers to confine animals in smaller pens).  However, Gorsuch does not apply this principle, instead pointing to a concession by the Pork Producers Council that producers are treated similarly regardless of geography.  Gorsuch then moves on to consider the constitutionality of a law that is not facially discriminatory (as in the hypothetical example above), but has a disproportionate effect on out-of-state businesses.  While the court did not specify whether Prop 12 would fall into this category, it would have ultimately made no difference.  Gorsuch refused to find such a law unconstitutional, writing that “[i]n our interconnected national marketplace, many (maybe most) state laws have the ‘practical effect of controlling’ extraterritorial; behavior.”

Next, Gorsuch considers the Pike balancing test in a series of sections where some justices join in his analysis while others do not.  Pike asks the court to weigh local benefits of a law against the burden it places on out-of-state commerce.  Again, Gorsuch returns to what he sees as an underlying requirement of discriminatory intent, even in the cases decided using the Pike analysis.  He rules, in a section joined by Justice Thomas and Justice Barrett, that the cost/benefit analysis that Plaintiffs argued was not an integral part of the original Pike analysis, and that Pike does not authorize judges to “strike down duly enacted state laws… based on nothing more than their own assessment of the relevant law’s ‘costs’ and ‘benefits’”.  He further highlights the perceived difficulty in doing so as a judicial body; “[h]ow is a court supposed to compare or weigh economic costs (to some) against noneconomic benefits (to others)? No neutral legal rule guides the way.  The competing goods before us are insusceptible to resolution by reference to any judicial principle.”  Instead, he disclaims that cost/benefit role, arguing that the responsibility is better given to those with “the power to adopt federal legislation that may preempt conflicting state laws.”

Gorsuch also considers a framing of Pike that “requires a plaintiff to plead facts plausibly showing that the challenged law imposes ‘substantial burdens’ on interstate commerce before a court may assess the law’s competing benefits or weigh the two sides against each other.”  In a section joined by Justices Thomas, Sotomayor and Kagan, Gorsuch finds that under the facts presented in the complaint, a “substantial harm to interstate commerce remains nothing more than a speculative possibility.”

It’s important to note that the sections of the opinion addressing the Pike test were not adopted by the majority.  While Gorsuch wrote the opinion of the court, his reasoning was not adopted by the entire bench.  In fact, several justices (Sotomayor, joined by Kagan and Roberts, joined by Alito, Kavanaugh & Jackson) also wrote or signed onto dissents outlining their disagreements with specific elements of Gorsuch’s reasoning. These justices agree that courts can still consider Pike claims and balance a law’s economic burdens against its noneconomic benefits, even if the challengers do not argue that the law has a discriminatory purpose.  Much like the Rapanos case of WOTUS fame, this case did not result in clearly defined legal doctrine.

Justice Kavanaugh wrote as well, concurring in part and dissenting in part.  He highlighted concerns about the constitutionality of statutes like Prop 12, “not only under the Commerce Clause, but also under the Import-Export Clause, the Privileges and Immunities Clause, and the Full Faith and Credit Clause.”

NPPC:  What Happens Next?

At least theoretically, other challenges to Prop 12 might be filed on dormant Commerce Clause grounds with more facts presented in the complaint.  This would be possible because a plurality of Justices agreed that the Plaintiffs did not allege facts that would constitute a “substantial harm”.  New complaints, however, might allege facts sufficient to meet that burden.  Those hypothetical challenges may or may not also include some of the additional legal grounds identified in Kavanaugh’s opinion.  But as of right now- and for the foreseeable future- Prop 12 is constitutional.  However, there are other court cases pending that impact the immediate enforceability of Prop 12 and similar laws.

  • In California Hispanic Chamber of Commerce v. Ross, retailers asked for an extension of time to come into compliance with Prop 12 regulations for the sale of pork, which was granted by the court.  For retailers selling “whole pork meat,” the regulations may not be enforced until July 1, 2023.  For retailers selling veal and egg products, the regulations are currently effective.

  • Massachusetts Restaurant Association v. Healey addresses a 2016 Massachusetts law, similar to Prop 12.  The language of the statute is available here, and the regulations are available here.  The MA law was challenged on dormant Commerce Clause grounds, and the parties agreed to prevent enforcement of the portions of the law relevant to the sale of pork products until 30 days after the NPPC decision was issued by the USSC.  The portions relevant to the sale of egg and veal products are currently effective.

Is there still a possibility of stopping Prop 12 and other efforts to establish farm animal housing standards?

Continued lawsuits against Proposition 12 and other state laws that require certain production standards is a strategy that will likely continue.  As Elizabeth Rumley explained above, the recent NPPC opinion itself lays out two additional options for challenging Proposition 12:  alleging facts sufficient to meet the “substantial harm” requirement and raising the additional constitutional arguments highlighted by Justice Kavanaugh, such as the Import-Export Clause, the Privileges and Immunities Clause, and the Full Faith and Credit Clause. 

Federal lawmaking is another option.  Justice Gorsuch, in the NPPC decision, highlighted the constitutional power Congress possesses to “regulate Commerce … among the several States.”  The Justice suggested that Congress could displace Prop 12 by exercising its commerce power and enacting legislation that regulates the interstate trade of pork.  Some members of Congress have expressed willingness to include interstate commerce language in the upcoming Farm Bill. 

Others in Congress advocate a different strategy—legislation that restricts states from interfering with animal production practices.   A proposal raised unsuccessfully last year by Sen. Marshall (R-Kan) and Rep. Hinson (R-Iowa) may surface again in the wake of the NPPC.  But even with several options for federal legislation that would prevent Prop 12, many question whether there is sufficient congressional support.  Congress has a long history of unwillingness to overturn any type of state ballot initiative enacted by “the will of the people.” 

When and how will California enforce Prop 12?

With the NPPC decision by the Supreme Court, the California Department of Food and Agriculture’s Animal Care Program has issued guidance on how it will enforce Prop 12. The agency had already developed Prop 12 regulations, which require distributors and producers of pork to register and obtain a third-party certification of compliance by January 1, 2024.   For pork producers, certification involves passing an on-site inspection showing compliance with the housing standards and maintaining compliance records and requires an annual renewal process. The agency offers a Sow Housing Guide that illustrates Prop 12’s requirements that a sow’s enclosure be at least 24 square feet and does not prevent the sow from lying down, standing up, fulling extending all limbs without touching the side of the enclosure, or turning around freely. The agency is also presenting several webinars, including a webinar for pork producers on June 27.  

Will pork producers now begin complying with Prop 12?

That’s a question without a legal answer.  Those who do comply with the housing standards will certainly incur economic costs, and some producers had already done so prior to NPPC.  The National Pork Producers Council estimates that converting existing sow housing to meet the Prop 12 standards will run a producer about $3,500 per sow and national costs could total between $1.9 and $3.2 billion.  We can guess that some producers will not or cannot make the new investment, which in turn raises many more questions about the economic and social impacts of Prop 12.  As is often the case with controversial laws like Prop 12, we might always have more questions than answers.

 

 

Buckeye candies on a plate
By: Peggy Kirk Hall, Tuesday, March 07th, 2023

Did you know Buckeyes can make and sell homemade Buckeyes?  That’s because those peanut butter and chocolate candies we call Buckeyes are a “cottage food” in Ohio.  And our Cottage Food Law allows home-producers to make cottage foods with little agency oversight and without obtaining a food license.  There are several laws that do apply to making Buckeyes and other cottage foods, though.   We explain them in our newly updated law bulletin on Ohio’s Cottage Food Law.

Why do we have a Cottage Food Law?

Food science teaches us that some foods pose a lower food safety risk than other foods.  Likewise, some foods have a higher chance of causing a foodborne illness if not handled properly.  Our Cottage Food Law recognizes this difference and allows home-producers to make and sell those food products that have a low food safety risk and don’t require special handling.  At the same time, the Cottage Food Law prohibits home-producers from making higher risk “potentially hazardous” foods.

Which foods are cottage foods?

The Ohio Department of Agriculture (ODA) has the responsibility of determining which foods are cottage foods.  If a food is on the cottage food list, the Cottage Food Law applies.  The full list is in our Ohio Cottage Food Law Bulletin and in Ohio Administrative Code Section 901:3-20-04.  It includes items like baked goods, candies, jams and jellies, granola, and many dry mixes, herbs and mixes.  But note that there are exceptions in many of the categories.  For example, freezer jam and sugar free jam are exceptions in the jam category, and those types of jams are not cottage foods.  For this reason, it’s important to identify whether a specific food product is on the cottage foods list.  ODA also maintains a helpful list of foods that are not cottage foods, and we explain those in the bulletin.  Many producers will be disappointed to know that salsa is on that list.

What laws apply to cottage foods?

Even though a home-producer need not obtain a food license to make and sell a cottage food, there are four laws that do apply to a cottage food product.  These laws address:

  1. Labeling requirements
  2. Packaging restrictions
  3. Sales restrictions
  4. ODA product sampling authority

Read about these legal provisions and more in our Ohio Cottage Foods Law bulletin, available in the Food Law Library on farmoffice.osu.edu.  Also check out our recent webinar that addresses product development and laws for cottage foods and other home-produced foods in the Starting a Food Business webinar series. 

Baker with flour on hands
By: Peggy Kirk Hall, Friday, January 27th, 2023

The world loves a good baker.  If you’re one of those good bakers and you want to sell your baked goods, do you need a license?  Maybe. Our newly revised law bulletin, “The Home Bakery Registration Law in Ohio,” explains when a license or “registration” is necessary for selling home baked goods in Ohio.

Whether you need to register for a Home Bakery license depends on the type of baked good you’ll produce. Certain foods are at lower risk of a food safety concern when produced at home, which we refer to as “non-potentially hazardous” foods.  Those foods might fall under the Ohio Cottage Food Law, which does not require a license or registration for those who want to produce and sell foods that are on the cottage foods list. When a home baked good does pose higher food safety risks, however, the home bakery law applies to that food and additional practices are necessary to reduce food safety.  The producer who wants to sell that type of home baked good must register as a “Home Bakery" with the Ohio Department of Agriculture to help ensure that food safety practices are in place.

Which home-baked foods fall into which category?  This chart illustrates the differences between non-potentially hazardous “cottage" foods and potentially hazardous “home bakery” foods. If a food falls into the “potentially hazardous” category, the producer needs to apply for a Home Bakery license. 

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What’s required for the Home Bakery registration?  Our law bulletin explains the registration and inspection process and labeling requirements.  Read more about those parts of the Home Bakery Registration Law in our bulletin, available on the Farm Office Food Law Library at https://farmoffice.osu.edu/our-library/food-law.

Christmas ornament of Ohio capitol hanging on tree
By: Peggy Kirk Hall, Tuesday, December 20th, 2022

A new law giving local governments zoning authority over small-scale solar facilities may feel like a gift to counties and townships dealing with solar development conflicts.  The late amendment was one of a few surprises from the legislature as it wrapped up its lame duck session last week. 

Several other pieces of legislation affecting agriculture and natural resources that passed include local preemption of pesticides, loosening oil and gas drilling reviews on state lands, and new knowledge requirements for environmental health specialists that inspect retail food establishments. Here’s a summary of the agricultural related bills that now await the Governor’s action.

Zoning authority over small scale solar -- H.B. 501

An amendment to a township bill will grant counties, townships, and municipalities regulatory authority overthe location, erection, construction, reconstruction, change, alteration, maintenance, removal, use, or enlargement of any small solar facility, whether publicly or privately owned, or the use of land for that purpose.” The bill defines a “small solar facility” as one that has a single interconnection point to the grid and is under 50 MW. That number is important, because it addresses solar facilities that were not subject to S.B. 52, passed last year, which gave counties and townships new authority over wind and solar facilities that are over 50 MW. 

Agriculture – H.B. 507

This bill began as a simple provision reducing the number of poultry chicks that can be sold in lots from six to three.  Before it passed, however, the Senate Agriculture & Natural Resources Committee added six amendments, including these:

  • Local preemption of pesticides

Prohibits a political subdivision from regulating or banning the packaging, registration, labeling, sale, storage, distribution, use, or application of a pesticide registered with ODA on private property.

  • Environmental health specialists and food safety regulations

Requires ODA and ODH to adopt new rules for evaluating Environmental Health Specialists’ knowledge of food safety laws and to include the evaluations when assessing a board of health’s ability to license retail food establishments and food service operations.  Also revises several food safety laws to align them with state and federal laws.

  • Green energy in competitive retail energy laws

Defines “green energy” to be any energy that releases reduced air pollutants and cumulative air emissions or is more sustainable and reliable relative to some fossil fuels or is generated using natural gas, but excludes natural gas energy from renewable energy credits, except for gas from biologically derived methane.

  • Internet sales exemption from auction laws

Exempts from auctioneer and auction firm licensure requirements a person who, in any
calendar year, sells not more than $10,000 of personal property via an auction
mediation company (for example, eBay) if the company provides fraud protection to the buyer; and the property is the person’s own personal property, or the property is the personal property of another (sold without compensation).

  • Oil and gas drilling on state land

Requires a state agency to lease agency-owned oil and gas resources “in good faith” until new rules for nominating the development of resources are adopted by the Oil and Gas Land Management Commission.  The leasing party must demonstrate insurance and financial assurance and register with ODNR.

  • Towing authorizations for conservancy districts

 Authorizes a conservancy district police department to order the towing and storage of
a motor vehicle when the vehicle is an abandoned junk vehicle and when left on private or public property for a specified time.

Tax amnesty and appropriations – H.B. 66

H.B. 66 sets up the possibility of a tax amnesty program in 2023 and allocates $6 billion in one-time appropriations of COVID relief funds. And Medicaid draw down funds.

  • Tax amnesty

Allows a two-month tax amnesty program in 2023 for delinquent state taxes, local sales and use taxes, income tax withholding and more, but only if additional revenues from amnesty will be needed to meet General Revenue Fund obligations.

  • Ag-related appropriations

$4.5 million to Ohio Department of Agriculture for grants to county agricultural societies.

$250 million to Ohio Dept. of Development for water quality grants program.

Millions to Ohio Department of Natural Resources for state and local parks, and improvement, recreation, and conservation projects.

What proposals didn’t pass?

Since we’re at the end of the two-year session of the 134th General Assembly, any proposed legislation that did not pass is now dead.  Some of those proposals will be reintroduced next session, but we might never see others again.  The two most notable ag-related bills that died include:

Many solar developers were hoping this bill would pass, as it provides incentives for smaller scale subscription-based solar projects and solar projects on brownfield sites.  Landowners considering leases with solar developers who stated they were doing community solar projects must note that, because the bill did not pass, there is currently no legal authority to construct a community solar project in Ohio.

This proposal would have streamlined the process for landowners challenging compensation for property taken by eminent domain, increased the burden of proof by an agency using eminent domain, and expanded attorney fee and expense rewards for property owners.  It would also prohibit takings of property for recreational trails, an issue that has plagued northeast Ohio.  Sponsors say they will reintroduce next session.

What packages will the new year bring?

We’ll be keeping an eye on the new General Assembly, which will likely include new committee members and leadership on both the House Agriculture and Conservation and Senate Agriculture and Natural Resources Committee.  Our quick wish list for next session starts with:

  • Revisions to the agricultural and agritourism exemptions in county and township zoning law.
  • Mowing date and procedural revisions to the noxious weeds law
  • Updates and clarifications to the partition fence law
  • Streamlining and clarification of home-based and farm-raised food licenses

Follow the Ohio legislature at https://www.legislature.ohio.gov/.

 

Posted In: Food, Renewable Energy, Zoning
Tags: legislation
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