It’s that time of year again. A time full of excitement and hope. Kids and students are eagerly waiting for that final bell to ring, releasing them into weeks of freedom and fun. Some are celebrating with their closest loved ones as they prepare to embark on their next journey. And lastly, some parents have circled a certain fall date for when things return back to normal. It is finally nice to see hope, joy, and excitement return to our lives. These past 18 months have been a real wake-up call, and by no means is it over, but the light can be seen at the end of the tunnel. This past week has also been abuzz with interesting agricultural and resource issues. This edition of the Ag Law Harvest brings you some interesting lawsuits, reports, and initiatives from across the country affecting agriculture and the environment.
USDA expands aquaculture disaster assistance. The USDA has announced a policy change that makes food fish and other aquatic species eligible for the Emergency Assistance for Livestock, Honey Bees and Farm-raised Fish Program (ELAP). Previously, only losses of farm-raised game and bait fish were eligible under ELAP. Under the program, eligible producers can receive financial assistance for losses due to disease and certain severe weather events. To be eligible, losses must have occurred on or after January 1, 2021. The Farm Service Agency (FSA) is waiving the requirement to file a notice of loss within 30 calendar days for farm-raised fish and other aquatic species death losses that occurred prior to June 1, 2021. Producers must still provide records to document any eligible losses. The deadline to file an application for payment for the 2021 program year is January 31, 2022. The USDA also announced that it will purchase up to $159.4 million in domestically produced seafood, fruits, legumes, and nuts for distribution to domestic food assistance programs in order to address disruptions in the food production and supply chains resulting from the COVID-19 pandemic.
Oregon ballot initiative seeks to redefine animal cruelty. Supporters of Oregon Initiative Petition 13 (“IP13”) have succeeded in meeting their first requirement to putting their proposed law on the 2022 Oregon ballot. IP13 seeks to amend the definition of what constitutes animal cruelty and who can be punished. Oregon, like many other states, does have an animal cruelty law that prohibits individuals from unnecessarily harming animals. Additionally, Oregon’s current law specifically exempts certain practices from being assumed to be animal abuse (activities like farming, breeding livestock, hunting, fishing, wildlife management practices, rodeos, slaughter, and scientific or agricultural research). However, IP13 seeks to remove all the above listed exemptions and would make it a crime to engage in those types of activities. IP13 only exempts individuals that harm an animal because the animal posed an immediate risk of danger and veterinarians. Supporters of IP13 claim that no one should be above the law and should be held accountable for any and all animal abuse and neglect. Opponents of IP13 fear that if the initiative passes and becomes law, Oregon’s animal agriculture industry will be destroyed. Opponents argue that IP13 makes common farming practices like breeding and slaughtering livestock for food, illegal. If supporters of IP13 continue to collect signatures and meet the required thresholds, IP13 will be voted on by the citizens of Oregon in 2022.
Indiana passes law to purchase locally grown food from youth agricultural education programs. Indiana’s governor signed a bill into law that allows schools to purchase up to $7,500 worth of food from youth agricultural education programs. The bill, sponsored by State Rep. Steve Davisson, was born after local Indiana FFA students were raising hogs and growing hydroponic lettuce to sell to their school cafeteria but hit a roadblock because of state laws and requirements. House Bill 1119 provides an avenue for local youth agricultural programs to sell to their respective school districts and not compete against wholesale distributors. Rep. Davisson hopes the program will expand into other Indiana schools to give students practical agricultural experience and potentially launch students into a career in agriculture.
Federal lawsuit about USDA’s RFID tags for cattle dismissed. Last month we reported that farmers and ranchers from South Dakota and Wyoming filed a lawsuit against the USDA and its subagency, the Animal and Plant Health Inspection Service (“APHIS”), for improperly using advisory committees to create new rules in violation of federal law. Well, last week a Wyoming federal court dismissed the complaint against the USDA and APHIS. The court concluded that APHIS did not “establish” the Cattle Traceability Working Group (“CTWG”) or the Producer Traceability Council (“PTC”) as advisory councils to create the RFID tag rules. The court also found that the advisory groups were completely private and consisted of cattle industry representatives, showing that APHIS did not “establish” these advisory groups. Additionally, the court held that APHIS did not “utilize” or control the actions of the advisory groups. The court reasoned that the advisory groups and APHIS were working on parallel tracks to achieve the same goal, preventing and tracing animal disease for livestock moving across state lines, and that APHIS only provided input to the advisory groups. The court held that the USDA and APHIS were not in violation of federal law because the advisory groups were not subject to the Federal Advisory Committee Act. As it stands, the USDA and APHIS have rescinded their July 2020 notice that RFID tags would be required for cattle crossing state lines. However, attorneys and interest groups representing the farmers and ranchers in the Wyoming case still fear that APHIS and the USDA will use the information provided by these advisory groups to implement an “unlawful mandate” in the future.
South Dakota farmer suing the USDA over a mud puddle? On May 05, 2021, Arlen and Cindy Foster filed a federal lawsuit in South Dakota claiming that the USDA has improperly identified a mud puddle in the middle of their farm field as a federally protected wetland and that the Swampbuster Act violates the U.S. Constitution. Under the Swampbuster Act, farmers that receive USDA benefits cannot produce crops on or around a federally protected wetland or they risk losing all federal agriculture benefits. The Fosters contend that Arlen’s father planted a tree belt in 1936 to help prevent soil erosion which is now causing snow to accumulate under the tree belt producing a puddle in the field when the snow melts. The Fosters argue that this makes the puddle in their field an unregulated “artificial wetland” and is not subject to the Swampbuster Act or the USDA’s control. Additionally, the Fosters claim that the Swampbuster Act violates the Tenth Amendment of the U.S. Constitution, and that the federal government cannot regulate the Fosters’ alleged wetland. The Fosters reason that if their puddle should be considered a wetland, any regulation of that wetland should come from the state of South Dakota, not the federal government.
Hawai’i man fined over $600,000 for pouring poison into Paahe’ehe’e Stream. Hawai’i’s Board of Land and Natural Resources (“BLNR”) fined a Hilo resident $633,840 for pouring poison into a North Hilo stream and causing the death of an estimated 6,250 Tahitian prawns. North Hilo has a history of individuals using poison to harvest Tahitian prawn. DLNR, in conjunction with other natural resource protection entities, are continuously concerned with the impact that the poison will have on the local wildlife and environment. The $633,840 fine is the largest in BLNR history and advocates hope that it is a step in the right direction to let illegal fishers know that Hawai’i is committed to prosecuting individuals that engage in harmful environmental practices to the full extent of the law in order to protect Hawai’i’s natural resources.
Montana man sentenced to prison for cattle theft. A ranch manager has been sentenced to 30 months in prison and ordered to pay back $451,000 after pleading guilty to wire fraud and to selling cattle that he did not own. The Montana man was a ranch manager at Hayes Ranch in Wilsall, Montana from 2008 to 2017 and also started his own cattle company in 2015. When the owners of Hayes Ranch were out of town, the ranch manager began stealing cattle from his employer and selling them as if they were his own. The ranch manager was ordered to repay his former employer $241,000 for the stolen cattle. Additionally, the ranch manager was ordered to pay Northwest Farm Credit Services over $200,000 for selling cattle that he pledged as collateral for loans obtained from the lender.
The return of the U.S. Jaguar? Environmental groups and scientists recently published a paper urging U.S. wildlife managers to consider reintroducing jaguars to the American Southwest. Advocates argue that reintroducing jaguars to the region is essential to species conservation and restoration of the ecosystem. In July 2018, the U.S. Fish and Wildlife Service published a jaguar recovery plan as required by the Endangered Species Act of 1973. While the recovery plan does not call for the reintroduction of jaguars into the Southwest region of the U.S., federal officials have been increasingly focused on sustaining habitat, eliminating poaching, and improving public acceptance for jaguars that naturally make their way across the U.S.-Mexico border. The southwest region of the U.S. makes up 1% of the jaguar’s historic range but is suitable for sustaining the big cat. Jaguar sightings have been reported in the area, although very rarely. Jaguar advocates hope that potential opposition to the reintroduction of jaguars, specifically from ranchers and rural residents, can be eased by implementing compensation programs focused on things like increased livestock deaths.
There’s a lot of talk about carbon markets and agriculture these days. While carbon markets aren’t new, recent proposals in Congress and announcements by the Biden administration are raising new interests in them. Some companies are actively pursuing carbon trading agreements with farmers, further fueling the discussion in the agricultural community.
As is common for any new opportunity, the talk on carbon markets may be tinged with a bit of skepticism and a lot of questions. Do carbon sequestration practices have real potential as an agricultural commodity? That’s a tough question and the answer isn’t yet clear. There are answers for other questions, though, as well as resources that may be helpful for those considering carbon markets for the first time. Here’s a sampling.
What is a carbon market? A carbon market revolves around carbon credits generated by carbon reduction practices. In the farm setting, a producer who either lowers the farm’s carbon emissions or captures carbon through “sequestration” practices can earn carbon credits. Like other markets, a carbon market involves a transaction between a seller and a buyer. The seller sells a carbon credit to a buyer who can use the carbon credit to offset or reduce its carbon emissions.
Do carbon markets already exist? Yes, although they may be private markets with varying names occurring in different regions. For example, Bayer Crop Sciences began its Carbon Initiative last year, paying producers for adopting carbon reduction practices that will help Bayer reach its goal of reducing its greenhouse gas emissions by 30% in 2030. Indigo Ag began entering into long-term carbon agreements with producers in 2019, paying $15 per ton for carbon sequestration practices. Food companies and agribusinesses including McDonald’s, Cargill, and General Mills formed the Ecosystem Services Market Consortium, which will fully open its private carbon market in 2022.
Are legal agreements involved? Yes. Using a written agreement is a common practice in carbon market transactions, but the agreements can vary from market to market. Provisions might address acceptable practices, calculating and verifying carbon reductions including third-party verification, sharing data and records, pricing, costs of practices, minimum acreage, and contract period. As with other legal contracts, reviewing a carbon agreement with an attorney is a wise decision. Watch for more details about carbon agreements as we share our analysis of them in future blog posts.
What is President Biden considering for carbon markets? The Biden administration has expressed interest in developing a federal carbon bank that would pay producers and foresters for carbon reduction practices. The USDA would administer the bank with funding from the Commodity Credit Corporation. Rumors are that the bank would begin with at least $1 billion to purchase carbon credits from producers for $20 per ton. The proposal is one of several ideas for the USDA outlined in the administration’s Climate 21 Project.
What is Congress proposing for carbon markets? The bipartisan Growing Climate Solutions Act would require USDA to assess the market for carbon credits, establish a third-party verifier certification program overseen by an advisory council, establish an online website with information for producers, and regularly report to Congress on market performance, challenges for producers, and barriers to market entry. An initial $4.1 million program allocation would be supplemented with $1 million per year for the next five years. The Senate Agriculture, Nutrition and Forestry Committee has already passed the bill. The Rural Forest Markets Act, also a bipartisan bill, would help small-scale private forest landowners by guaranteeing financing for markets for forest carbon reduction practices.
Is there opposition to carbon markets? Yes, and skepticism also. For example, a recent letter from dozens of organizations urged Congress to “oppose carbon offset scams like the Growing Climate Solutions Act” and argued that agricultural offsets are ineffective, incompatible with sustainable agriculture, may further consolidate agriculture and will increase hazardous pollution, especially in environmental justice communities. The Institute for Agriculture & Trade Policy also criticizes carbon markets, claiming that emission credit prices are too low and volatile, leakages and offsets can lead to accountability and fraud issues, measurement tools are inadequate, soil carbon storage is impermanent, and the markets undermine more effective and holistic practices. Almost half of the farmers in the 2020 Iowa Farm and Rural Life Poll were uncertain about earning money for carbon credits while 17% said carbon markets should not be developed.
To learn more about carbon markets, drop into an upcoming webinar by our partner, the National Agricultural Law Center. “Considering Carbon: The Evolution and Operation of Carbon Markets” on May 19, 2021 at Noon will feature Chandler Van Voorhis, a leading expert in conservation and ecological markets. The Center also has a recording of last month’s webinar on “Opportunities and Challenges Agriculture Faces in the Climate Debate,” featuring Andrew Walmsley, Director of Congressional Relations and Shelby Swain Myers, Economist, both with American Farm Bureau. A new series by the Center on Considering Carbon will focus on legal issues with the carbon industry and will complement our upcoming project on “The Conservation Movement: Legal Needs for Farm and Forest Landowners.” There’s still more talking to do on carbon markets.
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.