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Barry Ward, David Marrison, Peggy Hall, Dianne Shoemaker – Ohio State University Extension
“Farm Office Live” returns virtually this winter as an opportunity for you to get the latest outlook and updates on ag law, farm management, ag economics, farm business analysis and other related issues from faculty and educators with the College of Food, Agriculture and Environmental Sciences at The Ohio State University.
Each Farm Office Live will start off with presentations on select ag law and farm management topics from our experts and then we'll open it up for questions from attendees on other topics of interest. Viewers can attend “Farm Office Live” online each month on Wednesday evening or Friday morning, or can catch a recording of each program. The full slate of offerings for this winter:
January 13th 7:00 – 8:30 p
February 10th 7:00 – 8:30 pm
February 12th 10:00 – 11:30 am
March 10th 7:00 – 8:30 pm
March 12th 10:00 – 11:30 am
April 7th 7:00 – 8:30 pm
April 9th 10:00 – 11:30 am
Topics to be addressed this winter include:
Outlook on Crop Input Costs and Profit Margins
Outlook on Cropland Values and Cash Rents
Outlook on Interest Rates
Tax Issues That May Impact Farm Businesses
Legal trends for 2021
Farm business management and analysis updates
Farm succession & estate planning updates
Who's on the Farm Office Team? Our team features OSU experts ready to help you manage your farm office:
Peggy Kirk Hall -- agricultural law
Dianne Shoemaker -- farm business analysis and dairy production
David Marrison -- farm management
Barry Ward – farm management and tax
Register at https://go.osu.edu/farmofficelive
We look forward to you joining us this winter!
Written by Jeffrey Lewis, Attorney, Agricultural & Resource Law Program
Ohio’s past fair season was mayhem thanks to the COVID-19 pandemic, but some help is on the way. The Ohio General Assembly passed legislation on December 22 aimed at updating laws and regulations governing agricultural societies and local county fairs. Major highlights of the bill include increasing the amount that a county or independent agricultural society receives for operation expenses from a county, removing the cap on the amounts that a county may transfer to an agricultural society for junior club expenses associated with operating fairgrounds, and increasing the total amount of debt that a society may incur. Here’s a more detailed summary of the provisions contained within House Bill 665.
County payments to county or independent agricultural societies
For county and independent agricultural societies, H.B. 665 increases, from $800 to $1,600, the max amount that a county treasurer must annually transfer to a society operating within the county. The County Auditor is required to request that the County Treasurer make the transfer if: (1) the society held an annual fair; (2) the society has made an annual report to the Director of Agriculture concerning the fair; and (3) the Director presents a certificate to the County Auditor indicating that the society has complied with the applicable laws of Ohio.
H.B. 665 also removes the $500 cap on the annual amount that a Board of County Commissioners must reimburse an agricultural society for junior club expenses. Additionally, the $2,000 cap on the amount that a Board of Commissioners must annually appropriate to a county agricultural society has been removed, but only if the society: (1) owns or leases real estate used as a fairground; (2) has control and management of the lands and buildings on the fairground; and (3) requests an appropriation from the Board.
H.B. 665 expands the total amount of debt that an agricultural society may incur. Under the new law, county and independent agricultural societies’ annual payments for debt obligations cannot exceed 25% of the prior three-year average of its annual revenue. However, a county agricultural society must obtain approval from the Board of County Commissioners prior to incurring any debt if the Board pays or has paid money out of the county treasury to purchase the society’s fairgrounds.
Other notable provisions
- H.B. 665 removes restrictions on how proceeds for beer/liquor sales are to be used.
- Any county or independent agricultural society member can sell seasonal tickets or passes for the society’s annual fair and the sale need not be conducted on the premises of the fairgrounds.
- Any property owned by an agricultural society is now tax exempt, so long as that property is “used in furtherance” of the society’s purposes.
- Modernizes the manner in which a county agricultural society must publish its annual financial information.
- If the Board of County Commissioners wish to sell or exchange the fairgrounds, the Board must notify the applicable agricultural society 14 days prior to the sale or exchange.
H.B. 665 modernizes Ohio fair laws and agricultural society laws, some of which have not been updated since the 1950s. Many of the provisions contained within H.B. 665 were set to help out local agricultural societies for the 2020 fair season, and thus many provisions expired on December 1, 2020. However, the modernization and updates to Ohio’s laws will hopefully make next year’s fair season that much better. H.B. 665 now awaits Governor DeWine’s signature.
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 Farm Office team spends a good deal of time helping farmers with planning, and right now we’re practicing what we teach. The past few months have brought transitions to the Farm Office, with two team members leaving and a new member coming on board. The changes forced us to survey our strengths, weaknesses and opportunities, to review and revise goals, and to identify the skills and talent that we need for the future.
That planning process brought us Jeffrey Lewis, an attorney who joined the Agricultural & Resource Law Program this month. Jeff was in private practice for several years with Rolfes Henry Co, LPA in Columbus and was a legal intern with Wright & Moore Law Co, LPA in Delaware. He followed his degree from OSU in Business Administration with a law degree from Capital University Law School, where he was a law review member and graduated with honors. We’re excited that Jeff’s interests and expertise in business planning, non-profits, employment, and tax law align with the needs we identified in our planning process.
Jeff’s position was possible by a renewed partnership opportunity with the National Agricultural Law Center and funding from the USDA’s National Agriculture Library. That same grant allowed us to have Ellen Essman on staff for three years. Ellen recently moved to a new role with the college’s Government Affairs unit. As a law fellow with the Agricultural & Resource Law Program, Ellen authored many publications and led a national project surveying and assessing state efforts to address water quality impacts from agricultural nutrients. Ellen’s ability to explain current litigation and legislation on the Ohio Ag Law Blog with a touch of clever humor will be missed, but she will serve Government Affairs well.
The Farm Office is also planning for the departure of Ben Brown, Asst. Professor in Ag Risk Management, who recently left OSU to return home to the University of Missouri. OSU hired Ben several years ago and charged him with building a Farm Management Program in the Dept. of Agricultural, Environmental and Development Economics. He tackled that goal with astonishing energy, a mind built for marketing and policy analysis, and genuine interest in Ohio’s agricultural community. The Farm Office team will miss Ben’s passion and insight, but we look forward to continued collaboration with Ben in the future and hope to coax Ben onto Farm Office Live every now and then.
The past few months have reminded us that transitions are difficult, both in a farm operation and an institutional program. Our recent experience made us examine the impact of losing people, a reality that farm families face as generations move in and out of the farm operation. That's a topic we'll be able to teach more about this winter, now that we've done our planning.
Whether from trespassers, thieves, vandals, disgruntled employees, drug makers, activists, or extremists, farm security threats are a risk farmers face. Unfortunately, current social and political conditions have added new dimensions to that risk. Intruders can harm property in many ways: releasing or injuring livestock, stealing anhydrous or chemicals, destroying crops, contaminating water, introducing disease, setting fires, or committing other acts of theft, vandalism or destruction.
Recent suspicious activities on Ohio farms have reminded us of the need for constant awareness of farm security and the threat of intentional harm to farm property. Our newest publication, Intentional Harm to Farm Property: Legal Options and Strategies for Farm Owners aims to meet this need by addressing:
What to do when a farm security issue occurs. Three immediate actions can be helpful to ensuring a clear-headed reaction to an incident:
- Call local law enforcement.
- Secure the property and preserve the evidence.
- Contact insurance provider.
Options for legal action. How can a farmer address a security incident through the legal system? Local law enforcement might pursue a criminal action, a farm owner might choose to file a civil action, or both criminal and civil actions could take place. Conferring with law enforcement and an attorney will help determine an appropriate course of action. The bulletin explains common criminal actions that might apply to a farm security episode, such as:
- Agricultural product or equipment terrorism
- Animal or ecological terrorism based on corrupt activity
- Aggravated arson
- Breaking and entering
- Criminal damaging or endangering
- Criminal mischief
- Criminal trespass
- Injuring animals
- Poisoning animals
- Reckless destruction of crops or timber
- Attempt, complicity and conspiracy regarding any of the above crimes
We also review laws that provide for civil actions against someone who intentionally harms farm property, such as:
- Civil action for damages for criminal act
- Civil theft and willful damage
- Civil trespass to personal property, such as animals and equipment
- Civil trespass to real property
- Civil vandalism
- Civil action for animal or ecological terrorism
- Destruction of crops or timber
Preventing the risk of farm security occurrences. Farmers can adopt practices that reduce the possibility of intruders and incidents of intentional harm to farm property. We list a dozen strategies in the bulletin that may be helpful, such as marking, posting and security property boundaries, maintaining a record of suspicious activities, vetting employees, and conferring with a security professional.
Read more about Intentional Harm to Farm Property: Legal Options and Strategies for Farm Owners, which is available in the agricultural law library, here.