Ohio’s planting season will hopefully soon be as busy as its legislative season. There’s a lot of activity down at the capitol these days and many legislative proposals are on the move. Here’s a summary of bills that could impact agriculture and rural communities. Note that the summary doesn't include the budget bill, which we'll address in a separate article.
Water quality bonds. A joint resolution recently offered in the Senate supports amending Ohio’s Constitution to create permanent funds for clean water improvements. S.J.R. 2, a bipartisan proposal from Theresa Gavarone (R-Bowling Green) and Kenny Yuko (D-Richmond Hts.) would place a ballot issue before voters in November. The issue proposes amending the Constitution to allow for the issuance of general obligation bonds to fund clean water improvements. Up to $1 billion over 10 years would be permissible, with no more than $100 million allocated in any fiscal year. Bond funds would create a permanent source of funding for the H2Ohio program, which is now dependent upon the state budget process.
Animal-drawn vehicles. A bill to increase the visibility of animal-drawn vehicles has passed the House this session after failing to make it through the legislature in the last session. H.B. 30, sponsored by Scott Wiggam (R-Wooster) and Darrell Kick (R-Loudonville), would require animal-drawn vehicles at all times to display a flashing yellow light on top that is visible from all sides of the vehicle, along with an SMV emblem and/or reflective micro-prism tape on the rear of the vehicle. The bill now awaits introduction in the Senate.
Regulations. Senate Republicans reintroduced a proposal from last session to reduce administrative regulations and the Senate has already passed the measure. S.B. 9, sponsored by Kristina Roegner (R-Hudson) and R. McColley (R-Napoleon), mandates that each state agency must reduce its regulatory restrictions 10% by 2023, 20% by 2024 and 30% by June of 2025. The bill establishes criteria for reviewing rules and restrictions for elimination and would place a statewide cap on regulatory restrictions in 2024, to be determined by the Joint Committee on Agency Rule Review. Each agency must also prepare an inventory and annual reports of its progress. The bill has not been introduced in the House.
Fair funds. A bill directing $300 million to help businesses recover from COVID-19 includes funds for Ohio’s fairs. S.B. 109, sponsored by Nathan Manning (R-N. Ridgeville) and Michael Rulli (R-Salem) includes an allocation of $4.7 million from the General Revenue Fund to the Ohio Department of Agriculture to provide financial support to county and independent fairs. The funds would be in addition to the $50,000 allocated per junior fair for the 2020 fair season from the federal CARES Act. The bill has passed the Senate and been introduced in the House, where it has received a hearing before the Economic and Workforce Development committee.
Broadband services. There is definite interest in expanding broadband access in Ohio, but the House and Senate have different proposals for doing so. Two different bills would create a grant program in the Development Services Agency to fund eligible broadband expansion projects and enable access to electric cooperative poles for distribution purposes. S.B. 8, proposed by Rob McColley (R-Napoleon), allocates $20 million for the program in 2022, while H.B. 2, sponsored by Rick Carfagna (R-Genoa Twp.) and Brian Stewart (R-Ashville) proposes $170 million of funding for fiscal years 2021 to 2023. Both bills have passed their respective chambers and are under consideration in the Senate Financial Institutions and Technology committee and the House Finance committee. Amendments under consideration in those committees include expanding the grant program to government providers and electric distribution utilities and further defining adequate broadband speeds.
Eminent domain. A House bill proposed by Al Cutrona (R-Canfield) and Reggie Stoltzfus (R-Paris Township) would amend Ohio’s eminent domain law in relation to recreational trails. H.B. 63 would allow a municipality or township to veto the use of eminent domain for a recreational trail in its jurisdiction upon request by a property owner subjected to the eminent domain action. In two hearings before the Civil Justice committee, over a dozen landowners affected by a bike path in Mahoning County testified in support of the bill. The bill has stalled however, with no further hearings on the proposal currently scheduled.
Beginner farmer credits. A bipartisan bill to help beginning farmers has passed out of committee and awaits a vote in the House. H.B. 95, sponsored by Susan Manchester (R-Waynesfield) and Mary Lightbody (D-Plain Township) establishes a tax credit for businesses that sell or rent land, animals, facilities, or equipment to a beginning farmer. Individuals with a net worth of less than $800K who are seeking entry into farming or have been farming less than ten years, will provide daily labor and rely upon farming income, demonstrate profit potential, and have sufficient knowledge and financial training can be certified by the Ohio Department of Agriculture as a beginning farmer. Income tax credits for businesses that sell or rent assets to beginning farmers would be 5% of the sale price of an agricultural asset, 10% of the annual gross rental income on a cash lease, or 15% of the gross rental income on a share lease. Additionally, beginning farmers who attend an approved financial management program can receive a tax credit for the cost of the program.
Wind farms and solar facilities. Sponsors are reconsidering controversial twin proposals that would allow citizens to use the referendum process to reject proposed wind and solar energy developments in their communities. Senators Bill Reineke (R-Tiffin) and Rob McColley (R-Napoleon) and Representatives Craig Reidel (R-Defiance) and Dick Stein (R-Norwalk) announced they will redraft their proposal after completing three hearings a piece on S.B. 52 and H.B. 118. In the hearings, opponents argued the bill would dampen the growing renewable energy industry in Ohio, be costly to project developers, and cost jobs. Supporters claimed the bill protects property rights and gives property owners and local communities a necessary voice in the siting of large-scale wind and solar developments. An alternative proposal under consideration by the sponsors would create a process for communities that want wind and solar developments to signal their interest early while still allowing those that don’t want the development to use a referendum process. A substitute bill is expected soon.
OSU Farm Financial Management Institute. Companion bills S.B. 128 sponsored by Bob Peterson (R-Washington Court House) and H.B. 239 sponsored by Rodney Creech (R-West Alexandria) would revise an existing law that establishes a Farm Financial Management Institute at OSU. The Institute purpose would be to “train interested and qualified persons to assist farmers in addressing integration of farm production practices, agricultural marketing, farm policy, and financial management challenges.” The bill proposes funding of $250K per year for fiscal years 2022 and 2023, renaming the Institute to the “OSU Farm Production, Policy, and Financial Management Institute,” and adding farm owners and managers as priority participants. The Senate bill is up for a possible vote by the Workforce and Higher Education Committee on April 21 and H.B. 239 will receive its first hearing with the Agriculture and Conservation Committee on April 20.
Two bills that have already passed this session include:
State and federal tax conformity. S.B. 18 conforms the state tax code with recent changes to the Internal Revenue Code made in the federal Consolidated Appropriations Act. It also exempts forgiven Paycheck Protection Program second draw loan proceeds and Bureau of Workers Compensation dividend rebates from the Commercial Activity Tax. The bill was effective upon passage so that its provisions would apply to the 2020 tax season.
Contract limitations. S.B. 13 will become effective June 16, 2021. After that date, the period of time for filing a legal action on a written contract will reduce from 8 to 6 years and the verbal contract limitations period will also reduce by two years, from 6 to 4 years.
There’s an old saying that legislation either lives or dies in committee. Committees and their chairpersons play a critical role in determining whether an idea makes it through the legislative process and becomes a law. So let’s take a look at the new members and chairs of our agriculture committees, recently appointed for the new two-year session of the 134th Ohio General Assembly.
After announcing a change in the committee’s name from “Agriculture and Rural Development” to “Agriculture and Conservation Committee,” House Speaker Bob Cupp (R-Lima) finalized his committee appointments. The new committee will include:
- Rep. Kyle Koehler (R-Springfield) will return as Committee Chair. Now in his fourth term in the Ohio House, Rep. Koehler has a background as a software engineer and working for his family’s tool company but has raised livestock and refers to himself as a hobby farmer. Rep. Koehler recently received the “Friend of Agriculture” endorsement from Ohio Farm Bureau.
- Rep. Rodney Creech (R-West Alexandria) will serve as the new Committee Vice Chair during his first term in the House. Rep. Creech farms in Preble County, owns a lawn care business, and has served as a township trustee and county commissioner.
- Rep. Juanita Brent (D-Cleveland) will also return to the committee as its Ranking Member. Rep. Brent is in her second term in the House, with a background in non-profit and community engagement work.
- Rep. Brian Baldridge (R-Winchester)
- Rep. Adam C. Bird (R-New Richmond)
- Rep. Sarah Fowler Arthur (R-Geneva-on-the-Lake)
- Rep. Paula Hicks-Hudson (D-Toledo)
- Rep. Don Jones (R-Freeport)
- Rep. Darrell Kick (R-Loudonville)
- Rep. Joseph A. Miller (D-Amherst)
- Rep. Michael J. O’Brien (D-Warren)
- Rep. Jena Powell (R-Arcanum)
- Rep. Michael Sheehy (D-Oregon)
On the Senate side, Senate President Matt Huffman (R-Lima) announced the members of the Agriculture and Natural Resources Committee, which will include:
- Sen. Tim Schaffer (R-Lancaster) as the new Committee Chair. Sen. Shaffer is in his third term in the Senate and was also elected to the Ohio House for four terms. He is also an association executive in the private sector, and has earned the “Friend of Agriculture” award from Ohio Farm Bureau along with over a dozen other awards for his legislative service.
- Sen. Stephen A. Huffman (R-Tipp City) will serve as the Committee Vice Chair. Following two terms in the House, Sen. Huffman is in his first term as a Senator. Sen. Huffman is a practicing physician and will also chair the Senate’s Health Committee.
- Sen. Teresa Fedor (D-Toledo) is the committee’s Ranking Minority Member. A two-term Senator also elected to three terms in the House, Sen. Fedor is a veteran of the U.S. Air Force and Ohio Air National Guard and a retired teacher for Toledo Public Schools.
- Sen. Bob Hackett (R-London)
- Sen. Tina Maharath (D-Columbus)
- Sen. Sandra O’Brien (R-Ashtabula)
- Sen. Bob Peterson (R-Washington Court House)
The House Agriculture and Conservation Committee holds its first meeting next Tuesday, February 16. Follow the committee through its website, which includes meeting agendas and minutes, bills under consideration, and video of committee meetings.
The Senate Agriculture and Natural Resources Committee began its work last week with consideration of a bill authorizing the use of owls in the sport of falconry. Meeting agendas and bills under consideration are available on the committee’s website
Stay tuned to the Ohio Ag Law Blog for updateson legislative proposals and what bills live or die in our agriculture committees.
As disruptive as 2020 was, the Ohio General Assembly persisted in working for Ohio citizens. On our blog we have been providing you with some in-depth analysis on key legislation passed by the previous General Assembly. Below you will find brief summaries on additional pieces of legislation passed by the Ohio Legislature in 2020.
House Bill 24 – Revising Humane Society Law
H.B. 24 seeks to improve accountability for humane societies and other organizations throughout the state – this includes: (1) requiring each county humane society to submit an annual report of enforcement activities to the county sheriff; (2) making records of an enforcement activity by a humane society agent a public record; (3) prohibiting a humane society from entering into an agreement not to prosecute unless a judge has reviewed and approved the agreement; (4) specifying the removal procedures of a humane society agent from office; and (5) asserting that a humane society agent is a public servant for the purposes of bribery law and therefore a humane society agent is subject to criminal prosecution for bribery.
H.B. 24 also expands the current law governing the seizure and impoundment of companion animals. Under H.B. 24, any animal can be seized and impounded when related to a violation of an animal cruelty law. However, written notice is required within 24 hours after the animal is seized and impounded.
Governor DeWine signed H.B. 24 into law on December 29, 2020 and it becomes effective on March 31, 2021.
House Bill 33 – Establishing Animal Abuse Reporting Requirements
H.B. 33 adds dog wardens, deputy dog wardens, or other persons appointed to act as an animal control officer to the list of professionals who must immediately report child abuse to a public services agency or peace officer.
H.B. 33 requires veterinarians and specified social service or counseling professionals to report abuse of a companion animal to a law enforcement officer, humane society agent, or other animal control-type professional. Law enforcement, humane society agents, and animal control-type professionals must report abuse of a companion animal, under certain circumstances, to the appropriate social service professional. Lastly, H.B. 33 grants immunity to those required to make an animal abuse report, from criminal or civil actions, so long as the report was made in good faith.
H.B. 33 goes into effect on April 12, 2021.
House Bill 67 – Veterinarian Student Debt Assistance Program
H.B. 67 creates a Veterinarian Student Debt Assistance Program which allows the State Veterinary Medical Licensing Board to agree to repay all or part of any educational loans taken out by a veterinarian while in veterinary college. Veterinarians must apply for the program and perform 12 or more hours of charitable veterinary services to be eligible. H.B. 67 goes into effect on April 12, 2021.
Senate Bill 21 – Benefit Corporations
S.B. 21 allows certain corporations to become benefit corporations. A benefit corporation is a corporation that includes a beneficial purpose in the corporation’s articles of incorporation. Under the new law, a beneficial purpose is defined as a “purpose to have a bona fide positive effect, or to reduce one or more bona fide negative effects, of an artistic, charitable, cultural, economic, educational, environmental, literary, medical, religious, scientific, or technological nature for the benefit of persons, entities, communities, or interests aside from shareholders.” A benefit corporation is still allowed to operate for other purposes that help make the corporation profitable and neither the beneficial purpose nor any other purpose of the corporation has priority over the other. Under the law, once a benefit corporation is established, the corporation is allowed to use “benefit” or “b-“ as a prefix. Examples of popular benefit corporations include Patagonia, Seventh Generation, TOMS, and Ben & Jerry’s.
S.B. 21 goes into effect March 24, 2021.
Senate Bill 276 – Updated Limited Liability Company Laws
S.B. 276 enacts the Ohio Revised Limited Liability Company Act (ORLLCA) and makes some major updates to Ohio’s LLC laws. While the Bill is expansive, the following are two major highlights from the legislation.
Under current law, an Ohio LLC may be managed by its members or by a manager. In different scenarios, the authority to bind the LLC by a member or manager may vary. The ORLLCA does away with the member/manager distinction and provides that a person’s authority to bind the LLC must be determined by referencing the operating agreement, decisions of the members in accordance with the operating agreement, or by the default rules laid out in the ORLLCA.
Another major change includes the creation of the series LLC. A series LLC consists of a “parent” LLC and separate subdivisions (or series). Under the ORLLCA, a “parent” LLC’s operating agreement may provide for the establishment of one or more designated series that has at least one member associated with each series and either (or both) of the following: (1) separate rights, powers, or duties with respect to each series; and/or (2) a separate purpose or investment objective.
Under the ORLLCA, the debts, obligations, liabilities of a series do not jeopardize the assets held by the “parent” LLC or any other series. However, this limitation only applies if: (1) the records maintained for that series account for the assets of that series separately from any other assets of the “parent” LLC or other series; (2) the “parent” LLC’s operating agreement contains a statement to the effect of the limitation; and (3) the “parent” LLC’s articles of organization contain a statement that the LLC may have one or more series of assets subject to this limitation. So long as the records of the series are maintained in a manner that the assets of the series can be reasonably identified, the protection is likely to apply.
The ORLLCA is set to take effect January 1, 2022.
Just in time for Christmas, Congress delivered quite a package this morning by passing new COVID-19 relief legislation. President Trump is expected to sign the bill soon. Buried in the 5,593 pages of the legislation is an allocation of nearly $11.2 billion dollars to the USDA. A large portion of the USDA funds will provide additional payments for agricultural producers under the Coronavirus Food Assistance Program (CFAP). Benefits for food processors, energy producers and timber harvesters are also in the bill, as well as funding for several other USDA programs and studies. We’ve categorized, compiled and summarized where the USDA funds are to go below.
- Supplemental CFAP payments of $20 per eligible acre for the 2020 crop year, for eligible “price trigger crops,” which includes barley, corn, sorghum, soybeans, sunflowers, upland cotton and wheat, and eligible “flat rate crops,” which includes alfalfa, amaranth grain, buckwheat, canola, cotton, crambe, einkorn, emmer, flax, guar, hemp, indigo, industrial rice, kenaf, khorasan, millet, mustard, oats, peanuts, quinoa, rapeseed, rice, rice, sweet, rice, wild, rye, safflower, sesame, speltz, sugar beets, sugarcane, teff, and triticale but excludes hay, except alfalfa, and crops intended for grazing, green manure, or left standing.
- $100 million in additional funding for the Specialty Crop Block Grant Program.
Livestock, poultry and dairy
- Supplemental CFAP payments to livestock or poultry producers (excluding packers and live poultry dealers) for losses from depopulation that occurred due to insufficient processing access, based on 80% of the fair market value of depopulated livestock and poultry and including depopulation costs not already compensated under EQIP or state programs.
- Supplemental CFAP payments to cattle producers for cattle in inventory from April 16 to May 14, 2020 according to different payment formulas for slaughter cattle, feeder cattle and all other cattle.
- Supplemental Dairy Margin Coverage payments for eligible operations with a production history of less than 5 million pounds whenever the average actual dairy production margin for a month is less than the selected coverage level threshold, according to a specified formula.
- $1 billion for payments to contract growers of livestock and poultry to cover not more than 80% of revenue losses from January 1 to December 22, 2020.
- $20 million for the USDA to improve animal disease prevention and response capacity.
- Establishment of a statutory trust via the Packers and Stockyards Act that requires a dealer with average annual purchases above $100,000 to hold cash purchases of livestock by the dealer in trust until full payment has been received by the cash seller of the livestock.
General payment provisions
- In determining the amount of eligible sales for CFAP, USDA must include a producer’s crop insurance indemnities, non-insured crop disaster assistance payment and WHIP payments, and may allow a producer to substitute 2018 sales for 2019 sales.
- USDA shall make additional payments under CFAP 1 and CFAP 2 to ensure that payments closely align with the calculated gross payment or revenue loses, but not to exceed the calculated gross payment or 80% of the loss. For income determination, USDA shall consider income from agricultural sales, including gains, agricultural services, the sale of agricultural real estate, and prior year net operating loss carryforward.
- USDA may take into account when making direct support payments price differentiation factors based on specialized varieties, local markets and farm practices such as certified organic production.
Marketing and processing
- $100 million for grants under the Local Agriculture Market Program for COVID-19 impacts on local agriculture markets. USDA may reduce and allow in-kind contributions for grant matching requirements.USDA may provide support to processors for losses of crops due to insufficient processing access.
- $60 million for a grant program for meat and poultry slaughter and processing facilities seeking federal inspection status or eligibility for the Cooperative Interstate Shipment program to modernize facilities or equipment, comply with packaging, labeling, and safety requirements and develop food safety processes.
- USDA must deliver a report on possible improvements to the Cooperative Interstate Shipment program that allows interstate shipments of meat and poultry products and on the availability and effectiveness of federal loan and grant programs for meat and poultry processing facilities and support for increasing processing capacity.
- USDA may make recourse loans available to dairy product processors, packagers or merchandisers impacted by COVID-19.
- Until September 30, 2021, USDA may extend the term of marketing assistance loans to 12 months.
- $1.5 billion to purchase and distribute food and agricultural products to individuals in need, and for grants and loans to small and midsized food processors or distributors, seafood processing facilities, farmers’ markets, producers or other organizations for the purpose of responding to COVID, including for worker protections. USDA must conduct a preliminary review to improve COVID-19 food purchasing, including the fairness of purchases and distribution.
- $400 million for a Dairy Donation Program to reimburse dairy processors for purchasing and processing milk and partnering with non-profit organizations to develop donation and distribution plans for the processed dairy products.
Timber and energy
- $200 million for relief to timber harvesting and hauling businesses that experienced a loss of 10 percent or more in gross revenue from January 1 to December 1, 2020, as compared to the same period in 2019.
- USDA may make payments for producers of advanced biofuel, biomass-based diesel, cellulosic biofuel, conventional biofuel or renewable fuel produced in the U.S. for unexpected market losses resulting from COVID-19.
Training and outreach
- $75 million for the Farming Opportunities Training and Outreach Program for grants for beginning, socially disadvantaged and veteran farmers and ranchers impacted by COVID-19. USDA may reduce and allow in-kind contributions for grant matching requirements and waive maximum grant amounts.
- $28 million for grants to State departments of agriculture to expand or support stress assistance programs for agriculture-related occupations, not to exceed $500,000 per state.
- $75 million for the Gus Schumacher Nutrition Incentive Program, and USDA may reduce matching grant requirements.
We’ll keep digging through the legislation to report on other agricultural provisions. Or readers may take a look at H.R. 133 here. The USDA allocations we summarized are in Subtitle B, beginning on page 2,352.
The year is still fairly new, and 2020 has brought with it some newly-introduced legislation in the Ohio General Assembly. That being said, in 2020 the General Assembly also continues to consider legislation first introduced in 2019. From tax exemptions to CAUV changes, to watershed programs and local referendums on wind turbines, here is some notable ag-related legislation making its way through the state house.
- House Bill 400 “To authorize a nonrefundable income tax credit for the retail sale of high-ethanol blend motor fuel”
HB 400 was introduced after our last legislative update in November, so while it was first introduced in 2019, it still technically qualifies as “new” to us. Since its introduction, the bill has been discussed in two hearings in the House Ways & Means Committee. The bill would give owners and operators of gas stations a tax rebate of five cents per gallon for sales of ethanol. To apply, the fuel would have to be between 15% and 85% ethanol (E15). If passed, the tax credit would be available for four years. The bill is meant to encourage gas station owners in Ohio to sell E15, which is much more readily available in other states. The bill is available here.
- House Bill 485 “To remove a requirement that owners of farmland enrolled in the CAUV program must file a renewal application each year in order to remain in the program”
Introduced on January 29, 2020, HB 485 would make it easier for farmers to stay enrolled in the Current Agricultural Use Valuation (CAUV) program. CAUV allows agricultural land to be taxed at a much lower rate than other types of land. If HB 485 were to pass, the initial application for CAUV on land more than 10 acres would automatically renew each year but the landowner must notify the auditor if the land ceases to be devoted exclusively for agricultural use. Owners of agricultural land less than 10 acres in size, who can qualify for CAUV if gross income from the land exceeds $2,500, would have to submit documentation on the annual gross income of the land to the county auditor each year rather than filing the renewal application. The CAUV bill can be found here.
Legislation from 2019 still being considered
- House Bill 24 “Revise Humane Society law”
In November, we reported that HB 24 passed the House unanimously and was subsequently referred to the Senate Committee on Agriculture & Natural Resources. Since that time, the committee has held two hearings on the bill. The hearings included testimony from the bill’s House sponsors, who touted how the bill would improve humane societies’ public accountability. The bill would revise procedures for humane society operations, require humane society agents to successfully complete training in order to serve, and would establish procedures for seizing and impounding animals. It would also remove humane societies’ current jurisdiction over child abuse cases and make agents subject to bribery laws. Importantly, HB 24 would allow law enforcement officers to seize and impound any animal the officer has probable cause to believe is the subject of an animal cruelty offense. Currently, the ability to seize and impound only applies to companion animals such as dogs and cats. You can read HB 24 here.
- House Bill 109 “To authorize a property tax exemption for land used for commercial maple sap extraction”
HB 109 was first introduced in February of 2019, but has recently seen some action in the House Ways & Means Committee, where it was discussed in a hearing on January 28, 2020. The bill would give owners of “maple forest land” a property tax exemption if they: (1) Drill an average of 30 taps during the tax year into at least 15 maple trees per acre; (2) use sap in commercially sold maple products; and (3) manage the land under a plan that complies with the standards of reasonable care in the protection and maintenance of forest land. In addition, the land must be 10 contiguous acres. Maple forest land that does not meet that acreage threshold can still receive a tax exemption if the sap produces an average yearly gross income of $2,500 or more in the three preceding years, or if evidence shows that the gross income during the current tax year will be at least $2,500. You can find the text of the proposed bill here.
- House Bill 160 “Revise alcoholic ice cream law”
Have you ever thought, “Gee, this ice cream is great, but what could make it even better?” Well this is the bill for you! At present, those wishing to sell ice cream containing alcohol in Ohio must obtain an A-5 liquor permit and can only sell the ice cream at the site of manufacture, and that site must be in an election precinct that allows for on- and off-premises consumption of alcohol. This bill would allow the ice cream maker to sell to consumers for off-premises enjoyment and to retailers who are authorized to sell alcohol. HB 160 passed the House last year and is currently in Agriculture & Natural Resources Committee in the Senate. Since our last legislative update, the committee has had three hearings on the bill. In the hearings, proponents testified in support of the bill, arguing that it would allow their businesses to grow and compete with out of state businesses. Senators asked questions about how the ice cream would be kept away from children, how the bill would help business, and about other states with similar laws. To read the bill, click here.
- Senate Bill 2 “Create watershed planning structure”
In 2019, SB 2 passed the Senate and moved on to the House Energy and Natural Resources Committee. If passed, this bill would do four main things. First, it would create the Statewide Watershed Planning and Management Program, which would be tasked with improving and protecting the watersheds in the state, and would be administered by the ODA director. Under this program, the director of ODA would have to categorize watersheds in Ohio and appoint watershed planning and management coordinators in each watershed region. The coordinators would work with soil and water conservation districts to identify water quality impairment, and to gather information on conservation practices. Second, the bill states the General Assembly’s intent to work with agricultural, conservation, and environmental organizations and universities to create a certification program for farmers, where the farmers would use practices meant to minimize negative water quality impacts. Third, SB 2 charges ODA, with help from the Lake Erie Commission and the Ohio Soil and Water Conservation Commission, to start a watershed pilot program that would help farmers, agricultural retailers, and soil and water conservation districts in reducing phosphorus. Finally, the bill would allow regional water and sewer districts to make loans and grants and to enter into cooperative agreements with any person or corporation, and would allow districts to offer discounted rentals or charges to people with low or moderate incomes, as well as to people who qualify for the homestead exemption.
Since SB 2 moved on to the lower chamber, the House Energy and Natural Resources Committee has held multiple hearings on the bill, and has consented to two amendments. The first amendment would keep information about individual nutrient management plans out of the public record. Similarly, the second amendment would keep information about farmers’ agricultural operations and conservation practices out of the public record. The text of SB 2 is available here.
- Senate Bill 234 “Regards regulation of wind farms and wind turbine setbacks”
SB 234 was introduced on November 6, 2019. Since that time, the bill was assigned to the Senate Energy & Public Utilities Committee, and three hearings have been held. The bill would give voters in the unincorporated areas of townships the power to have a referendum vote on certificates or amendments to economically significant and large wind farms issued by the Ohio Power and Siting Board. The voters could approve or reject the certificate for a new wind farm or an amendment to an existing certificate by majority vote. The bill would also change how minimum setback distances for wind farms might be measured. The committee hearings have included testimony from numerous proponents of the bill. SB 234 is available here. A companion bill was also introduced in the House. HB 401 can be found here.
Here's our gathering of recent agricultural law news you may want to know:
Case highlights value of Ohio’s Grain Indemnity Fund. The recent prosecution and guilty plea of a grain handler who withheld $3.22 million in proceeds from grain he sold on behalf of 35 farmers in northern Ohio illustrates the value of Ohio’s Grain Indemnity Fund. The farmers had received approximately $2.5 million in reimbursement from the fund, which protects farmers from grain handlers who become insolvent. Though the fund, a farmer is reimbursed 100% for open storage grain in the elevator and 100% of the first $10,000 of a loss for future contracts, delayed price and basis transactions, with 80% reimbursement beyond the first $10,000 of loss. The grain handler, Richard Schwan, must now reimburse the fund and pay additional amounts to the farmers and the state. For more about the Grain Indemnity Fund, read our previous post.
More on North Carolina nuisance lawsuits against hog farms. A jury decision on June 29, 2018 awarded $25.13 million to a couple living next door to a 4,700 head hog farm in North Carolina owned by a subsidiary of Smithfield Foods. The award included $25 million in punitive damages. The apparent reason for the jury’s significant punitive damage award is Smithfield’s failure to finance and utilize new technologies that could reduce the impacts of current anaerobic lagoon and spraying application technologies. This is the second successful verdict in the second of many nuisance lawsuits filed by over 500 neighbors of hog farms owned by Smithfield.
North Carolina legislature reacts to nuisance wins. In response to the first two jury awards against Smithfield, the North Carolina legislature adopted new restrictions on nuisance lawsuits against farm and forestry operations. The legislation requires that a nuisance suit be filed within a year of the establishment of an agricultural or forestry operation or within a year of a “fundamental change” to the operation, which does not include changes in ownership, technology, product or size of the operation. The bill also limits the awarding of punitive damages to operators with criminal convictions or those who’ve received regulatory notices of violation. North Carolina Governor Roy Cooper vetoed the bill, but the legislature successfully overrode the veto.
Meanwhile, Court upholds Iowa Right-to-Farm law. The Iowa Supreme Court declined a request to declare the Iowa Right-to-Farm law facially unconstitutional for exceeding the state's police power. The court concluded that the Right-to-Farm law, which protects animal feeding operations that are in compliance with applicable laws and utilizing generally acceptable agricultural practices from nuisance lawsuits, falls within the legislature’s police power but could be unconstitutional as applied to a particular situation. However, such a determination requires application of a three part test and extensive fact finding by the court. Read more on Honomichl v. Valley View Swine, LLC here from Iowa State’s Center for Agricultural Law and Taxation.
IRS reveals the new Form 1040. It's not quite post card size, but the IRS claims that its draft of the revised Form 1040 is about half the size of the current form. The agency unveiled the draft form, which it intends to be shorter, simpler and supplemented with applicable schedules, and is seeking comments from the tax community. The new form, when complete, will replace the 1040, 1040A and 1040EZ.
Ohio legislation on the move. A flurry of activity at the Statehouse followed the lengthy re-election of a new House speaker that had stalled legislation this spring. Several bills have now been signed by Governor Kasich and a few bills have passed through one or both houses, as follows:
- Plugging idle and orphan oil and gas wells. A bill we reported on back in January, H.B. 225, was signed into law on June 29, 2018. The new law provides an increase, from 14% to 30%, in funding for plugging unused oil and gas wells. Landowners can report an idle or orphaned well to the Chief of the Division of Oil and Gas Resources, who must then inspect the well within 30 days and prioritize how soon the well should be plugged and the land surface be restored. The Chief’s duty to find prior owners and legal interests in the well is limited to records less than 40 years old. The law also includes procedural changes for entering into contracts for restoration or plugging of wells.
- Tax appeals. One provision in H.B. 292 allows a party to appeal a decision of the Board of Tax Appeals directly to the Supreme Court if it concerns a final determination of the Tax Commissioner or a municipal corporation's income tax review board. This reverses a recent change that removed the Supreme Court option for such appeals. The act also removes a provision that allowed a party to file a petition requesting that the Supreme Court take jurisdiction over an appeal from the Court of Appeals, which the Supreme Court was authorized to do if the appeal involved a substantial constitutional question or a question of great general or public interest. Governor Kasich signed the legislation on June 14, 2018.
- Hunting and fishing licenses. S.B. 257 creates multi-year and lifetime hunting and fishing licenses for residents of Ohio and allows the Division of Wildlife to offer licensure “packages” for any combination of licenses, permits, or stamps. The law also establishes the “Lake Erie sport fishing district,” consisting of the Ohio waters of Lake Erie and its tributaries. Nonresidents must obtain a $10 special permit to fish in the Lake Erie sport fishing district from January 1 to April 30, with the fees earmarked specifically to benefit Lake Erie. The legislation received the Governor’s signature on June 29, 2018.
- High volume dog breeders. New standards addressing sustenance, housing, veterinarian care, exercise and human interaction for dogs bred for sale in high volumes are in H.B. 506, signed by the Governor on June 29, 2018.
- Dogs on patios. H.B. 263, which we wrote about previously, has passed both the House and Senate. The bill allows retail food establishments and food service operations to permit customers to bring a dog into an outdoor dining area if the dog is vaccinated. The establishment must adopt a policy requiring customers to control their dogs and keep their dogs out of indoor areas. The bill just needs a signature from Governor Kasich to become effective.
- Alfalfa products. H.R. 298 was adopted by the House on June 7, 2018. The resolution recognizes the existence of two alfalfa products, direct dehydrated alfalfa and sun-cured alfalfa, as defined by the Association of American Feed Control Officials. The resolution further calls on alfalfa processors and suppliers use the defined terms in their labeling. A companion resolution in the Senate remains in committee.
- Township laws. A number of changes affecting township authority are in H.B. 500, which unanimously passed the House on June 27 and was introduced in the Senate on July 5. Of most consequence to agriculture are proposals to broaden township zoning authority over agricultural activities in platted subdivisions and authority for townships to impose fees for zoning appeals.