Did you know that a housefly buzzes in the key of F? Neither did I, but I think the musical stylings of the Cicada have stolen the show this summer.
Aside from Mother Nature’s orchestra, federal agencies have also been abuzz as they continue to review the prior administration’s agencies’ rules and regulations. This week’s Ag Law Harvest is heavily focused on federal agency announcements that may lead to rule changes that affect you, your farm or business, or your family.
USDA issues administrative complaint against Ohio company. The USDA’s Agricultural Marketing Service (“AMS”) issued an administrative complaint on May 4, 2021, against Barnesville Livestock LLC (“Barnesville”) and an Ohio resident for allegedly violating the Packers and Stockyards Act (“P&S Act”). An investigation conducted by the AMS revealed that the Ohio auction company failed to properly maintain its custodial account resulting in shortages of $49,059 on July 31, 2019, $123,571 on November 29, 2019, and $54,519 on December 31, 2019. Companies like Barnesville are required to keep a custodial account under the P&S Act. A custodial account is a trust account that is designed to keep shippers’ proceeds from the sale of livestock in a secure and centralized location until those proceeds can be distributed to the seller. According to the AMS, Barnesville failed to deposit funds equal to the proceeds received from livestock sales into the custodial account. Additionally, Barnesville reported a $15,711 insolvency in its Annual Report submission to AMS. Operating with custodial account shortages and while insolvent are both violations of the P&S Act. The AMS alleges that Barnesville’s violations place livestock sellers at risk of not being paid fully or completely. If Barnesville is proven to have violated the P&S Act in an oral hearing, it may be ordered to cease and desist from violating the P&S Act and assessed a civil penalty of up to $28,061 per violation.
USDA to invest $1 billion as first investment of new “Build Back Better” initiative. The USDA announced that it will be investing up to $1 billion to support and expand the emergency food network so food banks and local organizations can serve their communities. Building on the lessons learned from the COVID-19 pandemic, the USDA looks to enter into cooperative agreements with state, Tribal, and local entities to more efficiently purchase food from local producers and invest in infrastructure that enables organizations to more effectively reach underserved communities. The USDA hopes to ensure that producers receive a fair share of the food dollar while also providing healthy food for food insecure Americans. This investment is the first part of the USDA’s Build Back Better initiative which is focused on building a better food system. Build Back Better initiative efforts will focus on improving access to nutritious foods, address racial injustice and inequity, climate change, and provide ongoing support for producers and workers.
Colorado passes law changing agricultural employment within the state. On June 8, 2021, Colorado’s legislature passed Senate Bill 87, also known as the Farmworker Bill of Rights, which will change how agricultural employees are to be treated under Colorado law. The bill removes the state’s exemption for agricultural labor from state and local minimum wage laws, requiring agricultural employers to pay the state’s $12.32/hour minimum wage to all employees. Under the new law, agricultural employees are allowed to organize and join labor unions and must also be paid overtime wages for any time worked over 12 hours in a day or 40 hours in a week. The bill also mandates certain working conditions including: (1) requiring Colorado’s department of labor to implement rules to prevent agricultural workers from heat-related stress, illness, and injury when the outside temperature reaches 80 degrees or higher; (2) limiting the use of a short-handled hoe for weeding and thinning in a stooped, kneeling, or squatting position; (3) requiring an agricultural employer give periodic bathroom, meal, and rest breaks; and (4) limiting requirements for hand weeding or thinning of vegetation. Reportedly, Colorado’s Governor, Jared Polis, is eager to sign the bill into law.
Wildlife agencies release plan to improve Endangered Species Act. The U.S. Fish and Wildlife Service (“FWS”) and the National Marine Fisheries Service (“NMFS”) have released a plan to reverse Trump administration changes to the Endangered Species Act (“ESA”). The agencies reviewed the ESA following President Biden’s Executive Order 13990, which directed all federal agencies to review any agency actions during the Trump administration that conflict with the Biden-Harris administration objectives. The agencies look to reverse five ESA regulations finalized by the Trump administration which include the FWS’ process for considering exclusions from critical habitat designations, redefining the term “habitat,” reinstating prior regulations for listing species and designating critical habitats, and reinstating protections under the ESA to species listed as threatened. Critics of the agencies’ plan claim that the current administration’s proposals would remove incentives for landowners to cooperate in helping wildlife.
EPA announces intent to revise the definition of “waters of the United States.” On June 9, 2021, the EPA and the Department of the Army (the “Agencies”) announced that they intend to change the definition of “waters of the United States” (“WOTUS”), in order to protect the nation’s water resources. The Agencies’ also filed a motion in a Massachusetts federal court requesting that the court send the Trump administration’s Navigable Water Protection Rule (“NWPR”) back to the Agencies so they can initiate a new rulemaking process to change the definition of WOTUS. In the motion, the Agencies explained that pursuant to President Biden’s Executive Order 13990, they have reviewed the necessary data and determined that the Trump administration’s rule has led to significant environmental harm. The Agencies hope to restore the protections that were in place prior to the 2015 WOTUS rule. According to the EPA, the Agencies’ new regulatory process will be guided by: (1) protecting water resources and communities consistent with the Clean Water Act; (2) the latest science and the effects of climate change on the nation’s waters; (3) practical implementation; and (4) the experience and input of the agricultural community, landowners, states, Tribes, local governments, environmental groups, and disadvantaged communities with environmental justice concerns. The EPA is expected to release further details of the Agencies’ plans, including opportunity for public participation, in a forthcoming action. To learn more about WOTUS, visit https://www.epa.gov/wotus.
Are you perplexed by what “Sell By,” “Use By,” “Best If Used By,” and similar terms mean on your packaged foods? If the date has passed, should throw the food out, or take your chances with it? You are not alone in wondering about the meaning of dates and other terms printed on our food packages. Under most circumstances, food manufacturers are not required to include date labels and terms on packaged foods, so when they do include such labels, there are no official guidelines to follow. As a result, we have the current voluntary patchwork of various confusing terms. On May 23, 2019, the U.S. Food & Drug Administration (FDA) took a step toward alleviating the uncertainty surrounding date labels. FDA released a letter addressed to the “Food Industry” at large. In the letter, FDA said that it “strongly supports” the use of the term “Best If Used By” when the “date is simply related to optimal quality—not safety.”
In its letter, FDA cites confusion over terms on date labels as a contributor to food waste in the United States. People don’t know what the dates mean, or they think the date means the food is expired or not safe to eat, and so they throw the food out. The range of different phrases on date labels only adds to the confusion. FDA says around 20% of food waste by consumers can be attributed to unclear date labels.
As was mentioned above, the food industry is largely on their own in terms of choosing what kind of date language to include on their packaged food labels. (One exception is infant formula, which FDA requires to have a date label reading “Use By.”) Consequently, many of the date labels on packaged foods are not indicative of when a food is safe to eat. Instead, FDA says that “quality dates indicate the food manufacturer’s estimate of how long a product will retain its best quality. If stored properly, a food product should be safe, wholesome, and of good quality after the quality date.” Therefore, FDA supports using “Best if Used By” as the standard to communicate to consumers when a packaged food product “will be at its best flavor and quality,” which does not necessarily mean that the food is unsafe to eat after that date.
Not a binding law or regulation
FDA’s recommendation for the food industry to use “Best if Used By” on packaged food when including a date label is just that: a recommendation. Food companies are not required to use the terminology on their packaged foods; with the exception of infant formula, no date label is required by federal law or regulation. However, FDA “strongly supports industry’s voluntary…efforts” to use “Best if Used By” to communicate food quality to consumers. Therefore, the letter to the Food Industry is not a mandate by FDA, but an endorsement and strong suggestion that the industry use “Best if Used By” to indicate food quality.
Will “Use By” be the next recommended standard?
In its letter, FDA touches on another recommendation by grocery and food associations, but declines to endorse it. Grocery and food groups advocate for the use of the term “Use By” on date labels on perishable foods that may be unsafe to eat after the printed date. While FDA is not currently recommending the use of “Use By,” it is important to note that industry groups support using the term in this way. Perhaps after further safety studies, “Use By” will be the next recommendation on the horizon for FDA.
What does FDA hope to accomplish with this recommendation?
While FDA is not requiring the food industry to use the “Best if Used By” date label, the purpose of its recommendation is to encourage the majority of the industry to adopt the language as a standard. The hope is, that as “Best if Used By” is more widely used and the public becomes more educated on its meaning, the amount of confusion, and accordingly, the amount of food waste, will greatly decrease. To learn more about FDA’s decision to endorse “Best if Used By,” see their article here. For more information about food product dating, see USDA’s page here.
A case out of the Fourth Appellate District in Gallia County serves as a lesson for farmers in Ohio who have roadside stands and sell products using the honor system. This case involves a honey stand owned by Frederick Burdell. He kept cash in the freezer at his stand so customers could make change for their purchases. The case, State v. Montgomery, was an appeal from the Gallipolis Municipal Court’s conviction of first-degree misdemeanor theft of honey and money from a “self-service honey stand.”
On appeal, the person convicted of theft claimed that the State of Ohio did not have enough evidence to convict her, and that her conviction was against the manifest weight of the evidence. In other words, she argued that the State did not have enough evidence to prove, beyond a reasonable doubt, that she committed the crime. The appellate court did not agree with the defendant’s argument; her conviction was upheld. For owners of roadside stands, the most relevant part of this case may not be the legal arguments, but instead, the evidence that was provided by the owner of the honey stand. Mr. Burdell’s surveillance setup around the honey stand helped the jury find the defendant to be guilty of theft. Owners of roadside stands for honey and other agricultural products should take note of the tools Mr. Burdell had in place to surveil his stand, as well as what he might have done to better protect his business from theft.
The appellate court’s opinion reveals that Mr. Burdell had multiple cameras set up around the honey stand, which were able to capture footage of a car driving down the driveway and a passenger exiting the car. From another viewpoint, a camera was able to record the defendant taking two items out of the refrigerator and all the cash from the freezer. Another shot provided a close-up, “head to toe” view of the woman walking away. What is more, the video captured the actions in color—so the jury was able to see the color of the car and the hair color of the thief. The appellate court found that the video evidence was sufficient enough for the trial court to reach the decision that the defendant was the perpetrator.
Owners of roadside stands can learn from Mr. Burdell’s set-up if they want to protect themselves from theft. Multiple color cameras placed at multiple angles around the area helped Mr. Burdell recover some of his loss from the theft. Owners may want to test cameras to make sure they are set up at good angles. In addition, although it is not clear from this opinion whether or not Mr. Burdell had security lights and other lighting around his stand, owners of roadside stands may want to consider the lighting around their premises—inadequate lighting might be detrimental to seeing what is happening in surveillance footage.
The trial court ultimately awarded Mr. Burdell $20 in restitution for the theft, which was the value of the honey stolen. Mr. Burdell was not reimbursed for the money that was stolen, apparently because he could “not state…with certainty” how much money was taken from the freezer, instead he guessed it could have been up to $50. There are certainly numerous tools roadside stand owners can use to keep track of money in their stands more accurately. Owners can keep detailed records of what products are in their stand at any given time and their prices, so they know exactly how much money should be in the cash box at all times, even after customers make change. Roadside stand owners can also make sure they or an employee or family member monitors the area around the stand from time to time, counts the cash, and possibly take away excess cash not needed at the site and store it in a safer place. Essentially, any actions an owner can take to keep track of how much cash is in a stand with more accuracy could prove helpful in recovering stolen cash if they ever find themselves in a situation like Mr. Burdell.
While the theft from Mr. Burdell’s self-service honey stand was unfortunate, it may serve as a helpful reminder to farmers who own similar honey, produce, or other stands of what they can do to protect their businesses. It is also timely information as farmers prepare for spring and summer sales from roadside stands. For those interested in more information on the case, the full opinion is available here.
Throughout the month of November, the Ohio Department of Health (ODH) announced proposed amendments to rules, as well as the rescission and replacement of one rule, in the Ohio Administrative Code (OAC) Chapter 3717-1, the Ohio Uniform Food Safety Code. The changes are being recommended due to the required five year review of rules by ODH, as well as to “update the rules to be consistent to the current version of the Food and Drug Administration’s (FDA) Model Food Code,” which is required under Ohio law.
While most of the amendments to the rules are grammatical, or have to do with formatting or updating language, small, substantive changes are made in several rules. For instance, the proposed changes in OAC 3717-1-01 would change several definitions to be “consistent with FDA’s Model Food Code.” It would further “correct the definition of general use pesticide and restricted use pesticide to be consistent with the Ohio Department of Agriculture’s law,” among other changes. Proposed changes to OAC 3717-1-02.3 to make it mandatory for all food employees to cover or “restrain” their hair in some way. The changes recommended for 3717-1-03.2 would add requirements for the storage of utensils being used during cooking, prohibit the use of latex gloves in food service operations and retail food establishments, and add “nail brushes” to the list of control measures used by “food employees contacting ready-to-eat food with bare hands.” Changes proposed for OAC 3717-1-03.4 would add new requirements for the contents of a HACCP plan. Suggested modifications to 3727-1-08.2 would make it mandatory for the “[c]ustom processing of game animals, migratory waterfowl or game birds in a food service operation or retail food establishment…[to] be done only at the end of the work shift or day to prevent any cross contamination of product for sale or service.”
Finally, ODH proposes that 3717-1-20, which concerns existing facilities and equipment in a food service operation or food service operation, be rescinded and replaced. Although this seems like a major change, there are no real substantive changes between the current rule and the proposed replacement; ODH is simply suggesting a considerable reorganization of the rule’s wording and formatting. The entire rules package is available here.
A hearing on the changes will be held on Thursday, December 20, 2018 at 11:00 a.m. at ODH. The address is: 35 East Chestnut Street Columbus, Ohio 43215. The hearing will take place in ODH Basement Training Room A. Those who may be affected by the rules are invited to attend and participate. Any written comments must be submitted by 5:00 p.m. on December 18, 2018 to ODHrules@odh.ohio.gov. More information about the hearing, as well as a brief description of the changes being made to each rule, can be found in this document.
Every year, we hear fascinating legal updates at the American Agricultural Law Association’s annual conference. Thanks to presentations by Todd Janzen and Brianna Schroeder of Janzen Ag Law in Indianapolis, we were inspired to learn a little more about trends in meat law. For readers with a livestock operation, these legal issues can present great challenges, and keeping up to date on legal trends helps farmers stay prepared.
Veal, pork, and eggs: states battle each other on minimum confinement space regulations.
California voters passed Proposition 12 in the November 2018 election, which will require producers to comply with minimum confinement space regulations in order to sell certain products in California. The Prevent Cruelty California Coalition placed the proposition on the ballot, expanding a previous regulation on in-state suppliers, but the new law would apply to any producer trying to sell veal, pork, or eggs in California. By 2020, veal calves must be housed with at least 43 square feet of usable floor space, breeding pigs must be housed with at least 24 square feet of usable floor space, and egg-laying hens must have at least 1 square foot of floor space. However, by 2022, egg-laying hens must be cage free. Proposition 12 strengthens requirements approved by California voters in 2008’s Proposition 2 by imposing the requirements on out-of-state producers who want to sell their products in California.
In 2016, Massachusetts voters approved a ballot measure that would require eggs sold within the state to be cage free by 2022. Thirteen states, led by Indiana, have sued Massachusetts in the United States Supreme Court in an attempt to stop Massachusetts from enforcing the requirement. These states allege that the restriction is an attempt to regulate how farmers in other states operate, which violates the rights of other states to create their own regulations. This would be a constitutional question under what is known as the Dormant Commerce Clause, which prohibits states from unfairly regulating business activities that have impacts beyond a state’s border. Status updates on the lawsuit are available here.
Trying a legislative solution to slow the trend of cage-free restrictions, Iowa passed a law earlier this year that requires grocers that sell cage-free eggs to also sell conventional eggs if they want to receive benefits from the USDA WIC program. Supporters of the law argued that cage-free eggs are often more expensive and excluded from the WIC program. They argue that as a result, when grocers make commitments to sell only cage-free eggs, they make it more difficult for low-income families to purchase eggs.
Beef: non-meat proteins continue to target beef.
The “Impossible Burger” wants to convince consumers that a non-meat burger patty that tastes just like meat is just around the corner. Veggie burgers are not new to the grocery store shelves, but recent innovations that have allowed non-meat proteins to improve in taste and texture have raised concerns among meat producers that these products are becoming a serious threat. Given that many of these innovations have taken aim at the burger market, beef producers in particular have felt a target on their backs. As we reported in a previous edition of The Harvest, Missouri became the first state this year to regulate labeling of non-animal products as being derived from an animal, and the U.S. Cattlemen’s Association has petitioned the USDA to consider regulating labels involving animal terms like “meat.” Other speakers at the AALA conference indicated that the USDA is currently debating how to regulate labels, but has yet to develop a comprehensive rule package.
Dairy contracts: always know what you are signing.
The market has been very tough for dairy producers. Having a long term supply contract in place is certainly preferable to no contract, but depending upon the terms of the contract, unfortunate surprises may be in store.
Purchasers often write the contracts, and include terms that favor them. For example, many contracts contain termination provisions that allow either party to end the agreement for essentially any reason with prior notice, often 30 days. When producers invest in their operations under the expectation that the contract will stand throughout the term specified, these termination provisions can result in devastating surprises. As another example, many contracts contain confidentiality agreements that make it difficult for a producer to determine whether the deal they are offered is great, average, or actually bad. Equally concerning for producers are provisions that shift liability for problems with the milk to the producer, and away from the purchaser who sells the milk on the market. With modern technology, tracking where milk originated makes this possible. Courts are likely to enforce these agreements because the law of contracts favors enforcement of private agreements.
Given the current market, many dairy producers felt that they are not in a position to negotiate better terms, for fear that another dairy close by will accept the terms as-is. This position is made worse by the inability of producers to talk about their contracts with one another because of confidentiality provisions.
What a producer can do is to read the contract carefully and make sure that he or she understands the terms of the contract. It may be wise to speak with an attorney to verify that the producer’s understanding of the contract matches how the contract is likely to be read by a court.
With spring in full swing and summer just around the corner, many producers may be considering selling produce, meats, cottage foods and baked goods directly to consumers at the farm property. A question we often hear from farmers thinking about these types of farm food sales is, “do I need some type of license or inspection to sell food from the farm?” The answer to this question depends upon the type of food offered for sale:
- Sales of foods such as fresh produce or cottage foods do not require a license.
- Sales of certain types of baked goods require a home bakery license.
- Sales of multiple types of foods or higher risk foods require a farm market registration or a retail food establishment (RFE) license.
- The home bakery license, farm market registration, and RFE license involve inspections of the production or sales area.
It is important for a producer to carefully assess the food sales situation and comply with the appropriate licensing or registration requirements. To do so, a producer should identify the type and number of food products he or she will sell and whether the food poses low or high food safety risk.
Our new Law Bulletin, Selling Foods at the Farm: When Do You Need a License? will help producers assess their situations and determine their needs for appropriate licensing, registration, or inspections. Read the bulletin on http://farmoffice.osu.edu, here.