Ohio 133rd General Assembly

We might be in the middle of planting season, but it’s time for another harvest!  Here’s our latest gathering of agricultural law news that you may want to know:

Hemp bill completes third hearing in Ohio House committee.  The Agriculture and Rural Development Committee in the Ohio House of Representatives completed its third hearing regarding Senate Bill 57 on Tuesday.  The bill would decriminalize hemp produced under the regulatory system proposed in the bill.  The committee heard testimony from nearly two dozen individuals and organization representatives.  None of the witnesses gave testimony in opposition to the bill.  Nearly all of the testimony, including the testimony given on behalf of the Ohio Farm Bureau Federation and Ohio Chamber of Commerce, was offered in support of the bill.  The Ohio Farmers Union submitted testimony only as an “interested party” rather than as a “proponent,” saying that it supports the principle of hemp decriminalization, but does not believe that the hemp marketing program established in the current version of the bill would be necessary.  Click HERE to view the witness testimony regarding Senate Bill 57 on the Ohio General Assembly’s webpage.

Food and Drug Administration sets public hearing on cannabis in food and drinks.  The U.S. Food and Drug Administration has set May 31, 2019 as the date of its first hearing on whether to legalize the use of cannabis derived compounds like CBD in foods and drinks.  According to the Federal Register, the hearing is open to the public, and intended for the FDA to obtain scientific data and information about the safety, manufacturing, product quality, marketing, labeling, and sale of products containing cannabis or cannabis-derived compounds.  The hearing will be held in Maryland on May 31st, but those wishing to submit written or electronic comments may do so until July 2nd.  Click HERE for more information from the Federal Register about the hearing.

Cattle ranchers file class action suit against major meatpacking companies.  The Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America (R-CALF USA) and six other named parties brought suit against major meatpackers, including Tyson Foods, JBS USA, Cargill, and National Beef Packing Company.  Filed in federal court in the Northern District of Illinois, the plaintiffs’ complaint alleges that these meatpackers colluded to suppress the price of fed cattle since at least 2015, and that as a result, the plaintiffs suffered significant economic harm from the deflated prices.  When companies agree to set prices for an industry, they engage in collusion, which could violate U.S. antitrust laws.  The 121 page complaint includes a number of charts, graphs, and visuals that explain the alleged economic manipulation, along with a thorough history of an alleged pattern of collusion.  If the federal judge certifies the class as requested, other cattle ranchers will have the choice of whether to be included in the class or not.  This is important in determining whether the unnamed members of the class are bound by a final decision or able to participate in any settlement or final award.  Click HERE to view the complaint and learn more about this lawsuit.

Indiana Right-to-Farm law upheld by Court of Appeals of Indiana.  When a federal court in North Carolina decided that that state’s right-to-farm law did not protect hog barns operated by Smithfield Foods in lawsuits alleging agricultural nuisance, there was concern that right-to-farm laws in the United States may be in trouble.  However, those fears have begun to subside in other states.  As we explained in a previous blog post, Ohio’s right-to-farm law provides greater protections from a nuisance lawsuit than North Carolina’s law.  Further, the Court of Appeals of Indiana recently upheld the use of Indiana’s Right to Farm Act.  In doing so, it upheld a lower court decision that granted summary judgment in favor of the defendant livestock operators.  At the start of the case, the plaintiffs alleged that the defendants created a nuisance, acted negligently, and caused a trespass when the defendants constructed and began to operate a new concentrated animal feeding operation in 2013.  However, the defendants cited Indiana’s Right to Farm Act as a defense and won.  The plaintiffs sought to challenge the constitutionality of the Indiana’s Right to Farm Act, but the appellate court found that the law was within the legislature’s proper authority, did not constitute a taking, and did not improperly set farmers apart for preferential treatment.  The original plaintiffs have a few more days to file an appeal with the Indiana Supreme Court.  Click HERE to read the appellate court’s opinion.

State of Washington passes cage-free egg production law.  Washington is set to join states like Massachusetts and California in requiring egg-laying hens to live free of cages.  Once signed into law by the governor, Substitute House Bill 2049 would require poultry operators to use a cage-free housing system that would allow hens to roam within the confined area by 2023.  Further, hens must be “provided enrichments that allow them to exhibit natural behaviors including, at minimum, scratch areas, perches, nest boxes, and dust bathing areas.”  Farm employees must be able to provide care while standing in the hens’ usable floor space.  The bill would also make it illegal to buy, sell, or transport eggs and egg products that were not produced in compliance with the state’s cage free egg production law.  The Humane Society of the United States spearheaded the legislative effort on this bill, which initially passed the Washington House of Representatives 90-6 and the Senate 40-6.  Click HERE for more information about the bill’s status, and HERE to read the final text of the bill.

Missouri legislature considers ending local regulation of CAFOs.  The Missouri General Assembly is considering a pair of bills that would 1) limit the ability of county commissions and health boards from imposing restrictions on confined animal feeding operations that are more stringent than state law, and 2) eliminate the authority of county commissions and health boards from inspecting livestock operations.  So far, each bill has passed one chamber of the Missouri General Assembly, and is being considered in the other chamber.  Supporters argue that the bills would provide for regulatory consistency across the state in light of varying local regulations.  Opponents argue that the bills would harm local jurisdictions from enacting restrictions that better protect the environment than current state law.  This debate is similar to recent and ongoing debates in states like Tennessee and Wisconsin over which entities can regulate confined animal feeding operations, and how much.  Click HERE for more information about Missouri’s Senate Bill 391, and HERE for more information about Missouri’s House Bill 951.

State lawmakers have been busy crafting new legislation since the 133rd General Assembly took shape in January.  As promised, here are some highlights and summaries of the pending bills that relate to agriculture in Ohio:

• Senate Bill 57, titled “Decriminalize hemp and license hemp cultivation.”  The Ohio Senate Agriculture and Natural Resources Committee held a second hearing about the bill on March 13th, and numerous farm organizations spoke in support of the bill.  As of now the language of the bill has not changed since we last discussed Ohio’s hemp bill in a blog post, but some changes could be made when the bill is sent out of the committee.  Click HERE for more information about the bill, and HERE for the current official bill analysis.

• Senate Bill 2, titled “Create state watershed planning structure.”  The one sentence bill expresses the General Assembly’s intent “to create and fund a comprehensive statewide watershed planning structure to be implemented at the local soil and water conservation district level.”  It further expresses the intent “to provide authorization and conditions for the operation of watershed programs implemented by local soil and water conservation districts.”  Click HERE for more information about the bill.

• House Bill 24, titled “Revise humane society law.”  The bill would make various changes to Ohio’s Humane Society Law, including changes to enforcement powers, appointment and removal procedures, training, and criminal law applicability.  One of the significant changes would expand to all animals the seizure and impoundment provisions that currently apply only to companion animals.  This change would allow an officer to seize and impound any animal that the officer has probable cause to believe is the subject of a violation of Ohio’s domestic animal law.  At the same time, the bill would remove certain provisions from current law that pertain to harm to people, thereby focusing the new law solely on the protection of animals.  Click HERE for more information about the bill, and HERE for the current official bill analysis.

• House Bill 124, titled “Allow small livestock on residential property.”  Under this bill, counties and townships would no longer be allowed to restrict via zoning certain noncommercial agricultural activities on residential property conducted for an individual’s personal use and enjoyment.  Instead, owners of residential property that is not generally agricultural would be allowed to keep, harbor, breed, and maintain small livestock on their property.  Small livestock includes goats, chickens and similar fowl, rabbits, and similar small animals.  Roosters are explicitly excluded from this definition.  However, the owner would lose his or her rights to keep small livestock if the small livestock create a nuisance, are kept in a manner that causes noxious odors or unsanitary conditions, are kept in a building that is unsafe as defined under the statute, or if the number of animals exceeds a certain ratio of animals to acres as defined under the statute.  The ratio may be modified by the local jurisdiction to allow for more animals per acre.  Click HERE for more information about the bill.

• House Bill 55, titled “Require oil and gas royalty statements.”  Owners of oil and gas wells would have to provide mandatory reports to holders of royalty interests under this bill.  Current law only requires disclosure of the information upon request, but this bill would make the disclosure mandatory.  The bill would expand the types of information that the reports must include, and allows the holder of royalty interests to sue to enforce the new rights.  Click HERE for more information about the bill, and HERE for the current official bill analysis.

• House Bill 94, titled “Ban taking oil or natural gas from bed of Lake Erie.”  The Ohio Department of Natural Resources handles oil and gas permitting in Ohio, and this bill would bar the agency from issuing permits or making leases “to take or remove oil or natural gas from and under the bed of Lake Erie.”  Click HERE for more information about the bill.

• House Bill 95, titled “Revise Oil and Gas Law about brine and well conversions.”  The bill would ban the use of brine in secondary oil and gas recovery operations.  It would also ban putting brine, crude oil, natural gas, and other fluids associated with oil and gas exploration in ground or surface waters, on the ground, or in the land.  This restriction would apply even if the fluid received treatment in a public water system or other treatment process.  Further, brine disposal permits would not be allowed to utilize underground injection or disposal on the land or in surface or ground water.  Click HERE for more information about the bill.

• House Bill 100, titled “Revise requirements governing abandoned mineral rights.”  Ohio has a statute that governs when a surface owner can take the mineral rights held or claimed by another by operation of law, essentially because of the passage of time.  The bill would require a surface owner to attempt to give notice to a holder of mineral rights by personal service, certified mail, or if those are unsuccessful then by publication.  Currently, if a holder of mineral rights believes that his or her interest remains valid, he or she may file an affidavit that complies with Ohio Revised Code (ORC) § 5301.56(H)(1) in the county property records.  If the holder of mineral rights fails to file an affidavit, the surface owner may then file an affidavit under ORC § 5301.56(H)(2) that effectively vests the mineral rights in the surface owner.  The new law would allow the surface owner to challenge a holder of mineral rights’ ORC § 5301.56(H)(1) affidavit.  This process would require the surface owner to obtain a court determination that the affidavit is invalid.  Then the surface owner would be able to file the new ORC § 5301.56(H)(3) affidavit to obtain the mineral rights.  Click HERE for more information about the bill.

There are also some bills that could have some indirect implications in the agricultural and natural resources sectors.  These indirect effects make this next set of bills noteworthy, or at least interesting.

• Senate Bill 1, titled “Reduce number of regulatory restrictions.”  The bill would require each state agency to count its total number of regulatory restrictions, and then reduce the number of restrictions based on that baseline by 30% by 2022.  Once an agency meets its reduction target, it would not be able to increase the number of regulatory restrictions without making additional cuts elsewhere.  The bill would target agency rules that require or prohibit specific acts.  Click HERE for more information about the bill, and HERE for the current official bill analysis.

• Senate Bill 21, titled “Allow corporation to become benefit corporation.”  Much like the LLC merged the principles of a corporation and a partnership, the benefit corporation merges the principles of a corporation and a non-profit.  A benefit corporation must follow the formalities of a corporation, but the articles of incorporation can designate a social purpose for the business to pursue, such as promoting the environment through sustainable practices.  One of the unique traits of benefit corporations is that benefit corporations cannot be held liable for damages for failing to seek, achieve, or comply with their beneficial purpose, or even obtain a profit; however, certain individuals may seek a court ordered injunction to force the company to pursue those interests.  In a sense, the benefit corporation reduces the traditional fiduciary duties expected in general corporations.  The bill purports to maintain the traditional fiduciary duties, but by allowing a social purpose other than profit to guide decisions, the traditional fiduciary duties are in effect modified.  Click HERE for more information about the bill, and HERE for the current official bill analysis.

• House Bill 33, titled “Establish animal abuse reporting requirements.”  Under the bill, veterinarians and social service professionals would have to report their knowledge of abuse, cruelty, or abandonment toward a companion animal.  Social service professionals would include licensed counselors, social workers, and marriage or family therapists acting in their professional capacity.  Companion animals include non-wild animals kept in a residential dwelling, along with any cats and dogs kept anywhere.  These individuals would be required to report the neglect to law enforcement, agents of the county humane society, dog wardens, or other animal control officers.  Further, dog wardens, deputy dog wardens, and animal control officers would become mandatory reporters of child abuse.  Lastly, the bill explains the information that must be reported, the timing, and the penalties for failure to comply.  Click HERE for more information about the bill, and HERE for the current official bill analysis.

• House Bill 48, titled “Create local government road improvement fund.”  The bill proposes to deposit into a new local government road improvement fund some of the surplus funds generated when the state spends less than it appropriates in the general revenue fund.  Under current law, this surplus is split between the budget stabilization fund, also known as the “rainy day fund,” and the income tax reduction fund, which would redistribute remaining surplus to taxpayers.  Click HERE for more information about the bill.

• House Bill 54, titled “Increase tax revenue allocated to the local government fund.”  The bill would increase the proportion of state tax revenue allocated to the Local Government Fund from 1.66% to 3.53%.  Click HERE for more information about the bill.

• House Bill 74, titled “Prohibit leaving junk watercraft or motor uncovered on property.”  The bill would allow a sheriff, chief of police, highway patrol officer, or township trustee to send notice to a landowner to remove a junk vessel or outboard motor within 10 days.  The prohibition applies to junk vessels, including watercraft, and outboard motors that are three years or older, apparently inoperable, and with a fair market value of $1,500 or less.  Failure to cover, house, or remove the item in ten days could result in conviction of a misdemeanor.  Click HERE for more information about the bill, and HERE for the current official bill analysis.

As more bills are introduced, and as these bills move along, stay tuned to the Ag Law Blog for updates.