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After months of deliberation, the General Assembly delivered H.B. 96, the two-year state operating budget, to Governor Mike DeWine. Governor DeWine signed the bill into law on June 30, vetoing several provisions. DeWine issued a number of line-item vetoes, and the General Assembly plans to hold a session on July 21 to override the vetoes related to property tax provisions in the bill. There is also a chance that the General Assembly may override additional vetoes unrelated to property tax in the fall. While we will certainly keep an eye on these possible veto overrides, the provisions of the budget bill affecting agriculture remain mostly intact. Over the next few weeks, we will be sharing a series of blog posts about the newly passed state operating budget and its implications for agriculture in Ohio. Today’s focus will be on several licensing, permit, and fee changes affecting the ag and food sectors.
Various fee increases and changes
H.B. 96 increases inspection, licensing, and registration fees in many ag and food related industries. For instance, the budget bill:
- Increases the cost of a license to manufacture and distribute fertilizer in the state of Ohio from $5 to $50. If the manufacturer/distributor fails to renew its license, the late fees increase from $10 to $25.
- Increases the annual base inspection fee for plant nurseries that produce, sell, or distribute woody nursery stock from $100 to $200. On top of the inspection fee, there is a charge of $15 per acre for nursery stock grown in intensive production areas, and a charge of $10 per acre for nursery stock grown in non-intensive production areas.
- Changes the annual registration fees for bakeries. The fee used to begin at $30 and go up depending on how much product the bakery produced. H.B. 96 changes the annual bakery registration fee to a flat $200.
- Increases the license fee for frozen food manufacturing facilities, chill rooms, sharp freezing rooms and facilities, or sharp freezing cabinets from $50 to $200.
Seed labeler permits
In Ohio, no person is allowed to label agricultural, vegetable, or flower seed that is intended for sale in the state without a seed labeler permit. The budget bill makes the following changes to commercial seed labeler permits:
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- Increases the cost of permits from $10 to $50.
- Moves the expiration date for seed labeler permits from December 31st to January 31st of each year.
- Requires labelers to submit a sales report to the Ohio Department of Agriculture (ODA) annually instead of semiannually.
- A seed fee based on the amount of seed sold is typically due at the same time as the annual sales report. H.B. 96 changes how this seed fee is collected for alfalfa, clover, grass, native grass, mixtures containing any of these, and all agricultural, vegetable and flower seeds not specifically mentioned in the law. The new language states that if the total amount of fees due is less than $50, then seed labelers no longer need to pay a minimum fee.
Livestock dealer licensing
Ohio law defines livestock “dealers” or "brokers,” with some exceptions, as “any person found by the department of agriculture buying, receiving, selling, slaughtering, exchanging, negotiating, or soliciting the sale, resale, exchange, or transfer of any animals in an amount of more than two hundred fifty head of cattle, horses, or other equidae, or five hundred head of sheep, goats, or other bovidae, swine and other suidae, poultry, alpacas, llamas, or monitored captive deer, captive deer with status, or captive deer with certified chronic wasting disease status during any one year.” H.B. 96 modifies the law regarding licensing for these livestock dealers and brokers in the following ways:
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- Licensing fees for dealers and brokers used to be based on the number of head of livestock they sold per year. The new language creates a flat fee of $250 per annum.
- Increases licensing fees for small dealers from $25 to $50, and late fees for small dealers from $25 to $100.
- Increases licensing fees for each licensed weigher and each employee appointed by a livestock dealer from $20 to $30.
Registration and inspections for manufacturers and distributors of commercial feeds
Finally, the budget bill modifies registration and inspection requirements for manufacturers and distributors of commercial feeds. Commercial feed includes “all materials…that are distributed for use as feed or for mixing in feed for animals.” Under the new language in H.B. 96, the following changes have been made:
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- Manufacturers and distributors of commercial feed must register annually with ODA. Registration is due on February 1st of each year and expires January 31st each year.
- Manufacturers and distributors must pay an annual registration fee of $50.
- Inspection fees for commercial feed distributors will be collected annually instead of semiannually.
- ODA will not collect inspection fees on the first two hundred tons of commercial feed sold by a distributor of commercial feed in a calendar year.
If you’re up for some light reading, H.B. 96 is available in its entirety here. Stay tuned for our continuing series on the state operating budget!
A critical need for agriculture is having professionals who can help farm families and businesses plan for the future of their farms. That need is the source of a partnership between Ohio State's Agricultural & Resource Law Program and Iowa State's Center for Agricultural Law & Taxation. The two programs have once again partnered to offer the Third Annual Cultivating Connections Conference to grow the number and expertise of farm transition planning professionals. Iowa State will host the conference this year on August 4 and 5, 2025 in Ankeny, Iowa. The National Agricultural Law Center is a sponsor of the program.
The conference is a forum for learning and discussing the latest laws, strategies, tools, and insights necessary for effective farm transition planning. It brings together a diverse range of professionals -- attorneys, accountants, educators, and financial advisors -- who share a common goal: to preserve the legacy and sustainability of family farms for future generations.
At the heart of the conference is a focus on building strong, collaborative relationships among farm transition professionals. Conference sessions aim to impart knowledge, foster dialogue, and build a supportive community. Attendees can connect with peers and share issues, insights, and expertise.
OSU's Robert Moore will speak for the conference about his work with Long-Term Care Considerations for the Farm Transition. The agenda is full of additional speakers and sessions:
- Successfully Counseling the Farm Family on Succession - Robert Hanson, Professor Emeritus, U. of Nebraska
- Considering Farm Program Payments in the Transition Plan - Phil Newendyke, Pinion Farm Program Services
- 2025 Tax Update for the Farm Transition - Kristine Tidgren, Iowa State Center for Agricultural Law and Taxation
- Fresh Legal Tools for the Farm Transition - David Repp, Dickinson, Bradshaw, Fowler & Hagen, P.C.
- Fair Doesn't Mean Equal When It Comes to Farm Debt - Joe and Austin Peiffer, Ag & Business Legal Strategies
- Charitable Options for the Transition - Ame Mapes and Laura Ingram, Belin McCormick, Attorneys at Law
- Farm and Rural Landowner Case Studies - Travis Schroeder, Simmons Perrine Moyer Bergman, PLC and Mike Downey, UnCommon Farms
The conference will be in person at the FFA Enrichment Center in Ankeny, Iowa, but an online attendance option is also available. Learn more about the conference and register online at https://www.regcytes.extension.iastate.edu/cultivating/.
Tags: Cultivating Connections, farm transition, Farm Succession, Estate Planning, planning for the future, CLE
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Jimmy Buffett, the legendary singer-songwriter and businessman, passed away in 2023 leaving behind a substantial estate reportedly worth around $275 million. Recently, reports have surfaced that his widow, Jane Buffett, has filed a lawsuit against her co-trustee and Jimmy’s long-time business manager, Richard Mozenter. The dispute offers a high-profile example of several key estate planning issues:
- How trusts can be structured to provide for a surviving spouse
- The responsibilities, and potential pitfalls, faced by trustees
- The everpresent risk of conflict, even in well-planned estates
The Trust
The estate plan developed by Jimmy and his legal team followed a common structure used by millions of married couples. Upon Jimmy’s death, his assets were transferred into a trust. For the remainder of Jane’s life, she will receive all the income generated by the trust. After her death, the remaining assets will be distributed to their children.
This type of trust is often referred to as a marital trust, or more specifically, a Qualified Terminable Interest Property (QTIP) trust. A marital trust offers several benefits but the primary ones are deferring estate taxes, providing income and protecting assets. While most couples use a marital trust to achieve one or two of these goals, Jimmy’s plan appears to have been designed to accomplish all three. Let’s take a closer look at each of these benefits.
Deferring Estate Taxes
Jimmy’s $275 million estate far exceeded the $13 million estate tax exemption available in 2023. As a result, approximately $262 million of his estate would have been subject to estate taxes, potentially causing a tax bill of over $100 million.
However, the IRS allows these taxes to be deferred if the assets pass directly to the surviving spouse or are held for their benefit. In this case, the marital trust held the assets for Jane, deferring the estate tax until her death. Jane was not responsible for paying the $100 million estate tax bill but her children will be when they inherit the trust assets after her passing.
Marital trusts are a powerful tool for protecting the surviving spouse from an immediate estate tax burden. But it’s important to remember this is not a tax savings strategy, it’s a tax deferral strategy. The estate tax will still be due when the surviving spouse dies.
Providing Income
The assets held in a marital trust are typically structured to create income for the surviving spouse. To qualify as a marital trust, IRS rules require that all net income be distributed exclusively to the surviving spouse, at least once per year. In this case, the income generated by Jimmy’s trust must be distributed to Jane annually. As we’ll explore in more detail later, it is net income, the amount remaining after trust expenses are paid, that is distributed to the spouse. Provided the marital trust holds assets that produce income, the surviving spouse will receive a reliable stream of income for the remainder of their life.
Protecting Assets
Finally, a marital trust can help protect assets from mismanagement. According to court filings, Jimmy had concerns about Jane’s ability to manage his vast and complex holdings. This is a common issue as surviving spouses may lack the same business experience as the deceased spouse. A marital trust can help ensure the assets are properly managed, providing a steady income for the surviving spouse and preserving the remainder for the children’s inheritance.
In many cases, the surviving spouse serves as the sole trustee, giving them full control over asset management. This approach is common because it’s efficient and avoids the need to involve a third party. However, Jimmy took a different route. He appointed an independent trustee to serve alongside the surviving spouse. In this case, Mozenter serves as the independent trustee and appears to be primarily responsible for managing the trust assets and distributing income to Jane.
Whether a single trustee or multiple co-trustees are used, the role of trustee is critical. The trustee ensures the marital trust fulfills its intended purpose: supporting the surviving spouse while preserving the estate for future beneficiaries.
Welcome to Litigationville
So what caused a legitimate and common estate planning strategy to end up in Litigationville? It’s complicated, but Jane appears to be making two primary arguments:
- Mozenter’s trustee fees are excessive, and
- Mozenter is mismanaging the trust assets, resulting in less income being distributed to her than she believes she is entitled to.
Let’s take a closer look at the first issue.
Jane claims that Mozenter is collecting trustee fees of $1.7 million per year. If that number is accurate, is her complaint valid? At first glance, the fee seems excessive. How can it possibly cost that much just to distribute income to Jane each year? But the answer isn’t that simple.
We don’t know how much time and effort is involved in managing the trust. Jimmy’s assets may be extremely complex, requiring substantial oversight. Perhaps the trustee must manage multiple businesses, real estate holdings, or investments, and may need to hire a team of accountants and attorneys to do so. Without knowing the full scope of work, it’s difficult to say definitively whether the fee is excessive.
That said, $1.7 million is a significant amount, and Jane is certainly justified in questioning the trustee’s compensation.
So what do trustees typically charge to manage a trust? Spouses and family members who serve as trustees usually do not charge a trustee fee. That’s one of the benefits of naming a spouse or close relative as trustee, they often take on the role without compensation.
Unrelated third parties, however, typically charge a fee and for good reason. Managing a trust requires time, effort, and expertise. Every hour Mozenter spends administering Jimmy’s trust is time he cannot spend earning income from other professional activities such as advising clients. There’s also risk involved. A trustee has a fiduciary duty to manage the trust assets properly and can be held personally liable for mismanagement. Most people expect to be compensated for both their time and the risk they assume.
Corporate or professional trustees often charge between 0.5% and 1.5% of the trust’s value per year. In this case, Mozenter’s reported annual fee of $1.7 million is roughly 0.6% of the trust’s $275 million in assets, placing it within the standard range for professional trustees.
If Jimmy’s trust authorizes a “reasonable trustee fee”, a common provision, Jane may face an uphill battle. Mozenter’s fee is generally in line with what a corporate trustee would charge. However, if Jane can demonstrate that the fee is not reasonably related to the time and effort he actually spends managing the trust, she may succeed in her claim. If the court agrees, Mozenter could be required to return a portion of his fees to the trust.
The second argument involves Mozenter’s management of the trust. It appears Mozenter distributed $2 million in income from the trust to Jane. While that would be a generous distribution by most standards, Jane may be accustomed to a lifestyle that requires even more. But whether Jane needs more than $2 million annually is not the legal issue. The key question is whether the trust should be generating more income than it currently is.
Jane’s argument centers on the fact that a $2 million distribution represents less than a 1% return on a $275 million trust. That’s a fair point. But we need to take a closer look to determine whether her argument holds up.
As noted earlier, the income distributed to the spouse must be net income. That is, income remaining after trust expenses are paid. Mozenter’s $1.7 million trustee fee is one of those expenses and is paid out of trust income. That means the trust must have generated at least $3.7 million in total income, or about 1.35% of its value. On its face, that’s a modest return. Most people would expect more from such a large pool of assets.
But that’s not the whole story.
Media reports suggest that some of Jimmy’s assets are not income-producing. He reportedly owned things like cars, airplanes, residences, and musical instruments. These types of assets not only fail to generate income but they cost money to maintain. Factor in ongoing expenses and the trustee’s fees and it becomes more understandable why the net income might be relatively low.
So, while a 1.35% return seems underwhelming, it may reflect the nature of the trust’s holdings. If a large portion of the assets are illiquid or non-income-producing, and if the remaining assets are being prudently managed, then a $2 million income distribution could be entirely reasonable.
We can’t know for certain without reviewing the full list of trust assets, but the key takeaway is this: many factors affect the income-generating potential of a trust, and the trustee’s job is to do the best they can with the assets they’ve been given. Sometimes, that still results in a net income that disappoints the beneficiary.
What Could Have Prevented a Trip to Litigationville?
Without knowing all the details of the people and planning behind Jimmy’s trust, we can only speculate about what might have been done differently. But in most estate disputes, and possibly this one, a root cause is a lack of communication.
Did Jane know that Mozenter would serve as co-trustee, manage the assets, and effectively control her income stream? If not, perhaps Jimmy should have told her. Then again, had he shared that detail, he might’ve ended up in Divorceville instead of Litigationville.
That’s the tricky part about critiquing someone else’s estate plan, we weren’t there. We don’t know the family dynamics, the conversations that were had (or avoided), or the reasons behind certain decisions. Maybe Jimmy made the right call by keeping quiet. Or maybe it was a mistake not to inform Jane upfront. We simply can’t know for sure.
That said, in general, unless the conversation is likely to cause more harm than good, it’s better to communicate. Letting the beneficiary spouse know how much or how little control they’ll have over the assets and income can go a long way toward managing expectations. When it comes to trusts, the fewer surprises, the better.
The other issue is: was Mozenter the right choice for the trustee? Once again, without knowing the individuals involved, we can only speculate. But it’s a fair question: Was Mozenter the right person to serve as trustee?
What if Mozenter viewed his role primarily as an opportunity to maximize trustee fees and cash in on his long-standing relationship with Jimmy? Did the two of them ever have a clear discussion about compensation? Did Jimmy realize the trustee fee might amount to $1.7 million per year and was he okay with that?
On the other hand, was Mozenter the only person who had the experience to know and manage Jimmy’s assets? Was he the perfect person to be trustee and would anyone else have charged even more in trustee fees to manage the assets in Jimmy’s trust?
We don’t know the answers. Hopefully, Jimmy and Mozenter had a candid conversation about trustee compensation and Jimmy felt that the fees were reasonable and well-earned. If not, that could have been a costly oversight, especially with a trust of this size and complexity.
While trust law typically allows a trustee to take a “reasonable fee,” the only real way to control that fee is for the trust’s creator to ask the hard questions up front and specifically address compensation terms in the trust document. Again, better communication when implementing plans can lead to less conflict in the end.
What Did We Learn on Our Trip to Litigationville?
No trip is complete without a quick debrief of what we saw and learned. Here are a few key takeaways from the Jimmy Buffett trust dispute:
- The bigger the estate, the more planning it requires.
As estates grow, so do the stakes. Estate tax planning becomes more critical and the expectations of beneficiaries tend to rise along with the risk of disappointment and conflict. - Marital trusts are a powerful planning tool.
These trusts offer peace of mind. They help ensure that if one spouse passes away first, the surviving spouse and children are provided for, and the family's hard-earned assets are protected. - Communication is usually better, but not always.
It’s likely that better communication might have reduced the chances of Jimmy’s trust ending up in litigation. Experience tells us that lack of communication is often the root cause of estate disputes. In general, sharing your plans with spouses and beneficiaries is wise. But occasionally, disclosure causes more trouble than it's worth, and silence may actually serve the family better. It depends on the people and the dynamics. - A strong advisory team makes all the difference.
One thing we can say with confidence: having a good team of legal, financial, and tax advisors dramatically reduces the odds of conflict. No plan is perfect and even the best ones can still end in litigation. But, plans crafted by experienced professionals are more likely to be implemented smoothly and more likely to succeed.
Estate planning is like writing a song that you will never get to sing but that your family will hear forever. To make the best song (estate plan) for your family, plan carefully, communicate wisely and work with a good team. Regardless of how the litigation turns out, Jimmy left his wife a significant, reliable source of income for her life and protected the assets for his children. Maybe his plan isn't the best song he ever wrote but it still sounds pretty good.
Fresh fruits are coming into season all across Ohio, offering those who sell home-produced foods opportunities for new seasonal products. But it’s important to know how Ohio law regulates fruit-based foods, which can include a wide range of products such as jams, pies, and cheesecakes. Some of these food products are safe to make at home and sell to consumers with just minimal regulatory requirements, but producers might be surprised to learn that some fruit-based product ideas might require a different license or simply cannot be legally produced in a home-based kitchen. Here’s a rundown on different laws that apply to fruit-based home-produced foods.
Baked goods using fresh fruit
Adding fresh fruit to baked goods such as muffins, cookies, breads, pies, and cakes is permissible under Ohio’s “Cottage Food Law.” The cottage food law regulates lower-risk foods and allows home producers to make and sell foods on the cottage food list without a license, although the law does contain labeling requirements and marketing restrictions on cottage foods. For baked goods, the Cottage Food Law allows home-based producers to make any “non-hazardous” baked good without the need for a license or inspection. Non-hazardous baked goods includes cookies, brownies, cakes, breads, fruit pies, cobblers, granola bars, and unfilled baked donuts.
But note that using fruit in certain ways can affect the food safety risk and change whether the Cottage Food Law applies to the food. Here are three exceptions when using fruit with baked goods:
- Drying or dehydrating the fruit. A producer can’t dry or dehydrate the fresh fruit before adding it to the baked good. Because drying and dehydration processes increase food safety risk, the Cottage Food Law doesn’t allow those practices. A producer can, however, purchase and add commercially dried or dehydrated fruits to baked goods.
- Fruit garnishes and fillings. A different law applies when using fresh fruit as a garnish or filling in or on a baked good, as the fruit now creates a food safety risk. Because the baked good must be prepared properly and held at certain temperatures to keep it from spoiling, a home-based producer must have a “Home Bakery” license and a home inspection to produce the higher-risk fruit-based product and also must obtain a “Retail Food Establishment” license to sell the goods at a farmer’s market.
- Cheesecakes, cream pies and custard pies. These types of baked goods are not included on the Cottage Food list, so the law differs for them—whether with or without fruit. As dairy products, cheesecakes, cream pies and custard pies require temperature controls to reduce food safety risk. A producer who wants to sell any of these products must have a Home Bakery license, along with a Retail Food Establishment license if selling at a farmer’s market.
Fruit-based jams and jellies
Most jams, jellies, chutneys and fruit butters also fall under Ohio’s Cottage Food Law, and producers can make the products at home and sell them without a food license. But there are exceptions! Home-based producers need to know that Ohio law treats these fruit-based jam and jelly products differently:
- Freezer jam or jelly. Freezer jam or jelly is made without cooking the fruit and to keep it from spoiling, it requires storage at lower temperatures in a freezer or refrigerator. Freezer jam or jelly is not a cottage food, as it has higher food safety risk, and must be produced in a commercial kitchen with proper licensing.
- Sugar-free jam, jelly or fruit butter. Using certain types of artificial sweeteners increases the food safety risk of these types of products. For this reason, sugar-free jam and jelly products are not on the cottage food list. As with freezer jams and jellies, production in a licensed commercial kitchen is necessary.
Salsas and relishes
A fresh peach salsa is a sure sign of summer, but home-based producers need to know that they can't make and sell salsa from a home kitchen. Salsas, relishes, fermented foods, pickles, sauces—all of these types of foods carry higher food safety risks. Proper facilities and processing practices are critical to maintain the food’s safety, so the foods must be made in a licensed commercial facility.
For more information
Do you want to know more about the Cottage Food Law and Home Bakery Law? Visit the Food Law Library on OSU’s Farm Office website for videos and bulletins, along with information about our Food Business Central online course. For questions about making foods in licensed food processing facilities and commercial kitchens, the two governmental agencies to contact with questions are the Ohio Department of Agriculture’s Food Safety Division and your local Health Department. Do you need help developing a food product idea? See the resources offered by the Northeast Ohio Ag Innovation Center.
Tags: food law, cottage food law, home bakery law, commercial kitchen, food processing
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Governor DeWine has received two ag-related bills from the Ohio legislature that now await his action. Unless the Governor vetoes either bill, which is not expected, the new laws will affect healthcare benefits offered by the Ohio Farm Bureau and will formally add several "ag days" to the calendar.
The healthcare benefits bill
Senate Bill 100 proposes to allow certain organizations to offer healthcare benefits to its members without oversight by the Ohio Department of Insurance. The bill passed the House and Senate despite opposition from a number of health care advocacy groups who fear negative implications for covered persons resulting from the regulatory exemption.
The bill would apply to a “nonprofit agricultural membership organization,” defined as an organization that meets three criteria:
- The organization was incorporated in Ohio on or before December 31, 1919;
- Its purpose is to promote the interests of farms, and;
- It provides contractual healthcare benefit coverage exclusively to members of the organization and their families.
Under the bill, healthcare benefit coverage offered by a qualifying nonprofit agricultural membership organization is not considered to be “insurance” and would not be subject to Ohio insurance regulations if all of the following apply:
- The healthcare coverage is provided only to the organization’s members;
- The application for healthcare coverage and any contract provided to a member is in writing;
- The application for healthcare coverage and any contract provided to a member prominently states both of the following:
- That the healthcare coverage is not insurance;
- That the healthcare coverage is not subject to the laws and rules of this state governing insurance.
S.B. 100 would also prohibit a qualifying organization from marketing its healthcare coverage as "insurance" in any marketing materials, and it would allow the a qualifying organization to assume or reinsure the risks arising out of healthcare benefit coverage with nother company authorized to provide insurance in Ohio.
If the bill becomes law, it directly affects Ohio Farm Bureau, which meets the definition of a "nonprofit agricultural membership organization." Ohio Farm Bureau recently began offering Health Benefits Plans to its members, and those plans could be exempt from insurance regulations under S.B. 100.
Ag day designations
The Governor will also have an opportunity to act on House Bill 65, the "Agriculture Appreciation Act," which establishes several official designations for Ohio:
- The first week of October as “Ohio Stormwater Awareness Week”;
- March 21 as “Agriculture Day”;
- The week beginning on the Saturday before the last Saturday of each February through the last Saturday in February as “FFA Week”;
- October 12 as “Farmer’s Day”;
- The week ending with the second Saturday of March as “4-H Week”;
- The first full week of August as “National Farmers Market Week”; and
- The second full week of November as “Ohio Soil Health Week,” to celebrate and raise awareness for the importance of soil health to Ohio agriculture and in honor of the birthday of soil pioneer and advocate David Brandt.
A somewhat rare result of non-partisanship in Ohio, the Agriculture Appreciation Act passed both the House and the Senate with unanimous approval.
Tags: health insurance, designations, agriculture appreciation act, sb 100, hb 65
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Federal lawmakers have once again sparked debate over increasing the federal minimum wage, which has remained at $7.25 per hour since 2009. While many farmworkers are exempt from the federal minimum wage under the Fair Labor Standards Act (“FLSA”), a potential increase could still create significant ripple effects throughout the agricultural sector.
Earlier this month, Senators Josh Hawley (R-Mo.) and Peter Welch (D-Vt.) introduced the Higher Wages for American Workers Act, a bipartisan proposal that would raise the federal minimum wage to $15 per hour and index future increases to inflation.
Although agricultural employers in Ohio are generally exempt from federal minimum wage requirements, the reemergence of federal wage legislation presents a timely opportunity to revisit those exemptions and clarify what minimum wage obligations may apply to farm employers under both federal and state law.
Federal Agricultural Exemptions
Under the FLSA, agricultural employers are not required to pay the federal minimum wage to certain employees if one or more of the following conditions apply:
- Small Farm Exemption: The employer did not use more than 500 man-days of agricultural labor in any calendar quarter of the previous year.
- Family Member Exemption: The employee is the parent, spouse, child, or another immediate family member of the employer.
- Hand-Harvest Laborer Exemption: The employee:
- is employed as a hand-harvest laborer,
- is paid on a piece-rate basis,
- commutes daily from their permanent residence, and
- was employed in agriculture for fewer than 13 weeks during the previous calendar year.
- Youth Hand-Harvest Exemption: The employee is:
- 16 years old or younger,
- employed as a hand-harvest laborer,
- paid on a piece-rate basis,
- working on the same farm as their parent or legal guardian, and
- receiving the same piece-rate wage as employees over age 16.
- Range Production Exemption: The employee is engaged in the range production of livestock.
Understanding the 500 Man-Days Threshold
The “man-day” exemption is intended to relieve small or family-operated farms from federal minimum wage requirements. A “man-day” is any day in which an employee performs at least one hour of agricultural labor. The total number of hours worked is irrelevant, working just one hour still constitutes a full man-day.
To determine whether an employer meets the exemption, all workers across all operations owned or managed by the same farmer must be included in the calculation. For example, if one employee works a single hour on Monday and two others work an hour each on Tuesday, the farm accumulates three man-days across those two days. The FLSA sets the threshold at 500 man-days per calendar quarter, which is roughly equal to employing seven employees for five days a week over a 13-week quarter. Importantly, all categories of labor—full-time, part-time, seasonal, and temporary—count toward the total.
Family Member Exemption Clarified
Agricultural employers are not required to pay the federal minimum wage to certain immediate family members engaged in agricultural labor. The Department of Labor defines "immediate family" for this purpose to include parents, spouses, children, stepchildren, stepparents, foster children, and foster parents.
However, more distant relatives, such as siblings, cousins, nieces, nephews, and in-laws—do not qualify for the exemption, even if they live in the same household. These individuals must be treated as regular employees and may be subject to minimum wage and hour requirements.
State Minimum Wage Considerations
In addition to federal law, employers must comply with state wage laws. When state and federal minimum wage laws conflict, employers must follow the law that is more protective of the employee, typically, the law with the higher minimum wage.
In Ohio, the state minimum wage is higher than the federal rate, and most employers are required to pay the state minimum. However, Ohio law includes exemptions that mirror federal law and allows certain agricultural employers to pay less than the state minimum wage if they qualify under those exemptions.
This alignment between state and federal law means that many Ohio farm employers remain exempt from both wage requirements—especially small farms and family-run operations. But this is not the case in all states. For example, California and Washington require that all agricultural workers be paid the state minimum wage, regardless of whether they qualify for a federal exemption.
Who is Considered an Agricultural Employee?
Both federal and Ohio law define “agriculture” broadly to include a wide range of farming activities. The legal definition encompasses the cultivation and tillage of soil, dairying, growing and harvesting of agricultural or horticultural commodities, and the raising of livestock, bees, fur-bearing animals, or poultry. It also includes related tasks performed by a farmer or on a farm in connection with these activities, such as preparing goods for market or transporting them to storage or distribution.
This definition divides agricultural work into two main categories:
- Primary agriculture, which includes traditional farming activities like planting, growing, and harvesting crops or raising livestock.
- Secondary agriculture, which covers work that supports or is incidental to primary agriculture—for example, servicing equipment used on the farm or applying pesticides via aircraft.
Employees engaged in either primary or secondary agricultural activities are generally classified as agricultural employees and may fall within the FLSA exemptions described above.
Agritourism and Value-Added Activities: A Different Category
Classification becomes more complicated when farm operations expand beyond traditional agriculture by engaging in agritourism or producing value-added products.
Employees who work in agritourism, such as operating a corn maze, staffing a farm store, managing event rentals, or leading educational tours, are typically not considered agricultural employees under federal or Ohio law. Because their work is commercial or recreational rather than agricultural in nature, they do not qualify for agricultural labor exemptions and are therefore entitled to full wage and hour protections, including minimum wage and overtime.
Similarly, employees involved in processing agricultural products may also fall outside the scope of the agricultural exemption, depending on the nature and extent of the processing. These workers may be treated as employees in a manufacturing or commercial enterprise and must be compensated accordingly.
Conclusion.
While federal and Ohio laws provide specific exemptions from minimum wage requirements for agricultural employers, the application of these exemptions depends on several nuanced factors—including the nature of the work performed, the size and structure of the farming operation, and the relationship between the employer and employee. As farms continue to diversify through agritourism and value-added ventures, employers must be mindful that not all workers will qualify for agricultural exemptions. Understanding the distinction between agricultural and non-agricultural labor is essential to ensuring compliance with both federal and state wage laws and avoiding potential liability. As legislative efforts to raise the federal minimum wage continue, now is an opportune time for agricultural employers to review their labor practices and clarify their wage obligations under the law.
By: Carl Zulauf, Seungki Lee, and David Marrison, Ohio State University, June 2025
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Estimates of payments by ARC-CO (Agriculture Risk Coverage – County version) for the 2024 crop year use county yield estimates from USDA, RMA (US Department of Agriculture, Risk Management Agency) (https://webapp.rma.usda.gov/apps/RIRS/SCOYieldsRevenuesPaymentIndicators.aspx). Legislation requires FSA (Farm Service Agency) to give primacy to RMA yields when determining ARC-CO payment, but other factors can be considered. Thus, these ARC-CO payment estimates are likely to be closer to the FSA payment rate than the payment estimates made in May 2025 using county yield estimates from USDA, NASS (National Agricultural Statistics Service) (https://quickstats.nass.usda.gov/). Other data used to makes these payment estimates are 2024 crop year program parameters and market year price estimates from USDA, FSA (https://www.fsa.usda.gov/resources/programs/arc-plc/program-data).
FSA is expected to release official payment rates in October 2025. They can differ notably from estimates. Market year prices and county yields are not final. They are also currently in a range where small changes can cause large changes in ARC-CO payment rates. Use the estimates with caution.
June 2025 Estimates of 2024 Crop Year Payments:
- ARC-CO: Ohio corn and soybean payments are expected for some counties. As a revenue program, ARC-CO payment calculations include yield. 2024 Ohio weather was highly variable. Yields and thus county payment rates will be variable. Payment estimates per base acre vary from $0 (50 counties) to $81 (Ross and Highland) for corn base and from $0 (17 counties) to $60 (Mercer) for soybean base (see appended maps). These estimates include the 85% payment factor (i.e. 15% payment reduction factor). Also appended are maps of county gross revenue (estimated price times estimated yield) plus estimated ARC-CO pay rate per acre. They illustrate that ARC-CO payments are countercyclical to low market revenue (correlation between total revenue and ARC-CO pay rate is negative). Higher revenue/yields are thus almost always preferred to an ARC-CO payment. Note, some counties have irrigated and non-irrigated base acres. Payment estimates are only for non-irrigated base since dryland production is far more common in Ohio.
- PLC: At present, no PLC payment is expected for corn, soybeans, and wheat. Projected US market year price is not below the effective reference price: corn ($4.35 vs. $4.01), soybeans ($9.95 vs. $9.26), and wheat ($5.50 vs. $5.50).
Commodity Program Policy Objective:
- ARC-CO provides assistance if a crop’s county market revenue is below 86% of a crop’s county benchmark market revenue for 5 recent crop years.
- PLC provides assistance if a crop’s US market year price is below 100% of the crop’s US effective reference price set by Congress.
- ARC-IC provides assistance if an ARC-IC farm’s average per acre revenue from all program crops is below 86% of the ARC-IC farm’s per acre benchmark revenue.
Payment Formulas (* = times):
ARC-CO payment rate per base acre = MAX [$0, or 86% times (county benchmark revenue - observed revenue)] * 85% payment factor. County benchmark revenue = (5-year Olympic average (high and low value removed) of recent US market year prices * 5-year Olympic average of recent trend-adjusted county yields). Observed revenue = observed US crop year price * observed county yield. ARC-CO payment rate is capped at 10% of county benchmark revenue.
PLC payment rate per base acre = MAX [$0, or (US effective reference price – US market year price) * a farm’s PLC base yield * 85% payment factor.
Note: Counties labeled as $0 but colored in red are estimated to have non-zero payments of less than $1. Counties colored in white are estimated to receive no payment. Counties in gray are not processed due to missing FSA yield data.
Note: Counties labeled as $0 but colored in red are estimated to have non-zero payments of less than $1. Counties colored in white are estimated to receive no payment. Counties in gray are not processed due to missing FSA yield data.
Governor DeWine recently signed H.B. 15, which repeals parts of the controversial energy bill passed in 2019, H.B. 6. Introduced by Roy Klopfenstein (R, Haviland), H.B. 15 specifically repeals subsidies for coal-fired power plants introduced in H.B. 6, but it also does much more to promote energy production within the state of Ohio.
H.B. 15 is wide-ranging, but certain provisions may be of particular interest to Ohio agriculture and those living in rural areas of the state. The bill allows county commissioners, municipal corporations, or townships to adopt legislation requesting that the director of the Ohio Department of Development “designate the site of a brownfield or former coal mine within the subdivision’s territory as a priority investment area.” When considering the designation of a priority investment area (PIA), the director of the Ohio Department of Development is required to “prioritize the designation of areas negatively impacted by the decline the coal industry.” Under the law, the property becomes a PIA when the Director of Development notifies the local legislative authority, or within ninety days if no notification is sent. Once designated as a priority investment area (PIA), a property will be exempt from taxation for five years, which encourages public utilities to use the property for energy development. The law also requires the Power Siting Board to adopt rules for the accelerated review of energy projects located in an approved PIA.
Agricultural commodity groups like Ohio Corn & Wheat, as well as environmental groups like the Nature Conservancy, have praised the bill, noting that generating power on brownfields and former coal mines will have the added benefit of protecting farmland and native habitats. The thinking is that with more PIAs available for energy generation and accelerated approval from the Power Siting Board of PIAs, the need to use farmland and other areas for renewable energy projects would diminish. Instead, under the new law, political subdivisions and energy generators would be incentivized to use brownfield and former coal mine land that has already been developed, helping Ohio to both protect farmland and meet the demand for more energy generation. H.B. 15 will go into effect on August 14, 2025. The bill is available in its entirety here.
“Do your due diligence” is the lesson learned from a recent Ohio appeals court decision in a case alleging that a seller fraudulently induced a buyer in a real estate transaction. The Seventh District Court of Appeals rejected the buyer’s claim, stating that the doctrine of caveat emptor or “let the buyer beware” negated the fraudulent inducement argument because it placed a duty on the buyer to examine all “conditions open to observation.” The court reasoned that the buyer could not blame the seller for fraud because the buyer had the duty to examine public records that provided accurate information about the property.
The case
The conflict arose from the purchase of 143 acres of land in Belmont County, negotiated by two attorneys representing the parties. The buyer was present throughout the negotiations and read all of the e-mail correspondences between the two attorneys. The parties agreed to a purchase agreement, the buyer ordered a title search for the property, and the purchase took place. The buyer later learned, however, that a third party held an easement and right-of-way on the property. The easement allowed surface activities such as locating pipelines and well pads and restricted some development activities by the buyer.
After learning of the easement, the buyer filed a lawsuit claiming fraudulent inducement by the seller. A fraudulent inducement claim arises when someone uses a misrepresentation to persuade another to enter into an agreement. The buyer argued that the seller was fraudulent because the seller’s attorney never mentioned the easement during the purchase negotiations. The trial court agreed and determined that through misstatements and concealment, the seller had committed fraud that was “aggravated, egregious and/or reckless.”
The Court of Appeals disagreed. The court explained that, despite the seller’s actions, the doctrine of “let the buyer beware” obligated the buyer to investigate and examine “discoverable conditions” about the property. The easement was discoverable, as it had been recorded in the county public records. Because the easement information was readily available and the buyer had the opportunity to investigate it, the buyer could not successfully claim fraudulent concealment, the court concluded. According to the court, the buyer could not justify reliance on the seller’s omissions about the easement when the easement itself was a public record that was available to the buyer.
What does this decision mean for property transactions?
We’re back to “do your due diligence.” For property purchases, due diligence is the process of investigating and evaluating the property before finalizing the sale. A purchase agreement should include adequate time for due diligence after initial terms are agreed upon. During the due diligence period, a buyer can take a number of actions to evaluate whether or how to proceed with the purchase, such as:
- Complete visual and physical inspections of the land and buildings.
- Verify who holds ownership interests in the property.
- Determine if there are any easements, deed restrictions, covenants, severed mineral rights, pipelines, leases or other types of legal interests and limitations.
- Identify zoning and access regulations that apply to the property.
- Investigate environmental issues.
- Identify availability of water and utilities.
Additional inquiries might be necessary, depending on the type and intended use of the property. Hiring an attorney and other professionals can ensure that due diligence is thorough and tailored to the type of property at issue.
The time and cost of due diligence might be painful, but the doctrine of “let the buyer beware” demands it. As the Court of Appeals stated, “a seller of realty is not obligated to reveal all that he or she knows. A duty falls upon the purchaser to make inquiry and examination.”
Read the Seventh District’s opinion in Durr Farms, LLC v. Siltstone Resources, LLC on the Ohio Supreme Court’s website at https://www.supremecourt.ohio.gov/rod/docs/pdf/7/2025/2025-Ohio-1942.pdf.
Tags: property law, contract law, due diligence, buyer beware, caveat emptor, easement
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Written by Ellen Essman, J.D., Senior Research Associate with the OSU Agricultural & Resource Law Program
Note: We welcome Ellen Essman to the OSU Agricultural & Resource Law Program. Ellen worked with us previously, and has returned to assist with covering legislation and serving as the Education Director for our Ohio Farm Resolution Services agricultural mediation program.
The Ohio General Assembly is currently considering several bills that would affect agriculture, farmers, livestock producers, sellers of homemade foods, landowners, and students participating in FFA or 4-H. Here is an update on the bills we are following, including a few updates on bills we mentioned in our last legislative blog post.
H.B. 10 – Imitation meat and egg products
As we reported in our previous legislative blog post, H.B. 10 would prohibit the sale of foods that are “misbranded” as meat or egg products. Sponsored by Rep. Roy Klopfenstein (R-Haviland) and Rep. Jack Daniels (R-New Franklin), H.B. 10 defines “misbranded” meat and egg products as those that: contain manufactured-protein food products or fabricated-egg products, are offered for sale by a food processing establishment, and have a package label that includes certain “meat” or “egg” terms. A food processing establishment that sells misbranded meat and egg products would be subject to a penalty of up to $10,000 per day. The bill would also require Ohio agencies to request a USDA exemption of cultivated-protein food products and fabricated-egg products from eligibility under SNAP and WIC food programs and would require Ohio school districts and state institutions of higher education to adopt policies preventing the purchase of cultivated-protein food products or foods misbranded as meat or egg products. H.B. 10 is still being deliberated in the House Agriculture Committee. At the bill’s most recent hearing on May 28, there was no opponent or proponent testimony.
H.B. 65 – Agriculture Appreciation Act
The Ohio House of Representatives passed H.B. 65 on April 2, and the bill was introduced in the Senate on April 8. The bill had its first hearing in the Senate Agriculture and Natural Resources Committee on May 27, where sponsors by Rep. Roy Klopfenstein (R-Haviland) and Rep. Bob Peterson (R-Sabina) testified on its behalf. The sponsors cited the importance of agriculture to Ohio’s economy, and the long tradition of agriculture in Ohio as the catalysts for introducing this bill. The act proposes the following official designations:
- “FFA Week” as the week ending with the last Saturday in February.
- “4-H Week” as the week ending with the second Saturday of March.
- “Agriculture Day” on March 21.
- "National Farmers Market Week" as the first full week of August.
- “Ohio Stormwater Awareness Week” as the first week of October.
- “Farmer’s Day” on October 12
- “Ohio Soil Health Week” as the second full week of November, to celebrate and raise awareness for the importance of soil health and in honor of the birthday of soil pioneer and advocate David Brandt.
H.B. 65 had its second hearing in Senate Agriculture and Natural Resources on June 3, with no in-person testimony.
H.B. 125 – Excused school absences for 4-H and FFA programs
Introduced in the House on February 24 by sponsors Rep. Thomas Hall (R-Middletown) and Rep. Rodney Creech (R-West Alexandria), H.B. 125 has since had three hearings in the House Education Committee. The bill would require school districts to grant excused absences for participation in scheduled 4-H and FFA activities or programs to students in grades K-12, and to allow those students to make up any school work missed as a result of that absence. In order to verify absences for 4-H or FFA activities, the school must receive written documentation from 4-H or FFA educators. The bill would not allow for excused absences for 4-H activities during state testing or when a student has been disciplined by, suspended, or expelled from school.
H.B. 134 – Microenterprise home kitchen operation
A bi-partisan bill would add Ohio to the small but growing list of states that have adopted “food freedom laws” to loosen regulations on the sale of homemade foods. Sponsored by Rep. Jennifer Gross (R-West Chester) and Rep. Latyna Humphrey (D-Columbus), H.B. 134 would create a new “microenterprise home kitchen operation” registration that would broaden the types of foods a person could produce at home and sell directly to customers. Ohio law currently allows a person to sell certain “cottage foods” and “home bakery” foods with minimal regulation but requires producers of other foods to produce the foods in a commercial kitchen and operate under state and local food licenses. H.B. 134 would remove those requirements and allow a registered microenterprise home kitchen operation to produce and sell any homemade foods (except those containing alcohol or drugs), including items such as canned goods and hot meals. The annual $25 registration would require an inspection by the Ohio Department of Agriculture to ensure the microenterprise home kitchen operation meets requirements in the law regarding operations, food safety, storage and preparation, and sales and delivery of the food. H.B. 134 received its second hearing before the House Agriculture Committee on April 9, with two proponents testifying in support of the bill.
H. B. 201 – Allow specified hunting on landowner’s property without a permit
H.B. 201 was introduced in the House on March 26 by Rep. Kevin Miller (R-Newark), and Dani Isaacshon (D-Cincinnati), and had its first hearing in the House Natural Resources Committee on May 7. The bill would expand the list of relatives that may hunt and trap on an Ohio landowner’s property without purchasing a hunting license, deer or wild turkey permit, or fur taker permit from the Ohio Department of Natural Resource’s Division of Wildlife. The bill would make the following changes:
- Current Ohio law allows an Ohio landowner’s children and grandchildren under 18 to hunt on the land without a license. H.B. 201 would extend this to also allow parents of Ohio landowners to hunt without a license.
- Current Ohio law allows an Ohio landowner’s children to hunt deer and turkey on the land without obtaining permits. H.B. 201 would also allow the landowner’s parents and grandchildren to do so.
- Current Ohio law allows an Ohio landowner’s children to hunt and trap fur-bearing animals on the land without a permit. H.B. 201 would expand the current law to allow an Ohio landowner’s parents and grandchildren under 18 to hunt and trap without a permit.
S.B. 60 – Veterinarian Telehealth
Since the Covid-19 pandemic, we have all become familiar with telehealth medical appointments. S.B. 60, sponsored by Sen. Shane Wilkin, (R-Hillsboro), and Sen. Steve Huffman (R-Tipp City), would expand the ability to conduct telehealth appointments to veterinarians with their clients and patients (animals) under certain circumstances. Current law requires a veterinary-client-patient (VCP) relationship to be established in-person via an examination or visit to the patient. S.B. 60 would allow VCP relationships to be established via real time telehealth examinations.
The bill would also allow a licensed veterinarian to conduct telehealth services with a client and their animal (the patient) if:
- The veterinarian obtains the informed consent from the client, including an acknowledgement that the standards of care prescribed by the law governing veterinarians equally apply to in-person and telehealth visits;
- The veterinarian provides the client with the veterinarian’s name and contact information and secures an alternate means of contacting the client if the telehealth visit is interrupted; and
- Before conducting an evaluation of a patient via a telehealth visit, the veterinarian advises the client concerning certain information, including that the veterinarian may ultimately recommend an in-person visit.
Further, the bill would place some requirements on prescribing drugs during a telehealth appointment, including:
- A veterinarian may issue an initial prescription for up to 14 days. The veterinarian may issue one refill for up to 14 days if the veterinarian sees the patient for another telehealth visit. For additional refills, the patient must visit the veterinarian in person.
- The veterinarian must notify the client that certain prescription drugs or medications may be available at a pharmacy and, if requested, the veterinarian will submit a prescription to a pharmacy of the client’s choosing; and
- The veterinarian must not order, prescribe, or make available a controlled substance unless the veterinarian has performed an in-person physical examination of the patient.
S.B. 60 had its second committee hearing in Senate Agriculture and Natural Resources on May 27. Senators on the committee discussed amendments to the bill that would make the following changes:
- For livestock raised as food for human consumption, a VCP relationship must first be made in person before telehealth appointments would be permitted;
- However, veterinarians may give “tele-advice” prior to VCP being established in person. “Tele-advice” was described as “opinion or guidance from a veterinarian, but not a diagnosis, treatment, or prognosis;”
- An addition to the bill that it would not invalidate anything from Chapter 956 of the Ohio Revised Code, which governs dog breeding; and
- Telehealth appointments must occur in within the state where the patient is located.
In the May 27 committee hearing, several proponents of the bill also gave testimony in its favor. Those testifying cited numerous reasons why passage of the bill would be prudent, including the state shortage of veterinary professionals, the difficulty of people living in rural areas or with a lack of resources to access veterinary care for their animals, the passage of veterinary telehealth laws in other states, and the ability for veterinarians to give faster care in the case of emergencies. They also mentioned that the law would not replace in-person veterinary appointments but instead would be another tool in a veterinarian’s arsenal to care for animals.
On June 3, the Senate Agriculture and Natural Resources Committee held their third hearing on S.B. 60. There was no in-person testimony, and the Committee favorably reported the bill, with the May 27 changes, out of committee.
S.B. 122 – Local authority for agricultural land zoning resolutions
This bill was introduced in late February and had its first hearing in the Senate Local Government Committee on March 5 but no hearings since that date. S.B. 122, sponsored by Sen. Paula Hicks-Hudson (D-Toledo), would eliminate the authority of townships and counties to adopt zoning resolutions for agricultural land under certain circumstances.
The bill eliminates a township and county’s limited authority to utilize zoning to regulate any of the following in a platted subdivision or in an area consisting of 15 or more contiguous lots:
- Agriculture on lots of one acre or less;
- Buildings or structures incident to the use of land for agricultural purposes on lots between one and five acres by setback building lines, height, and size; and
- Dairying and animal poultry husbandry on lots between one and five acres when at least 35% of the lots in the subdivision are developed with at least one building, structure, or improvement that is subject to real property taxation or that is subject to the tax on manufactured and mobile homes.
Ohio law currently prohibits regulation of agriculture, buildings or structures, and dairying and animal and poultry husbandry on lots greater than five acres. S.B. 122 would broaden that prohibition to protect agriculture on smaller lots, which would be beneficial to those practicing urban agriculture.
S.B. 100 – Exemption from insurance regulations for nonprofit agricultural membership organizations
This bill would exempt healthcare benefits offered by “nonprofit agricultural membership organizations” from insurance regulations. The bill passed the Senate in early April and was favorably reported out of the House Insurance Committee on May 27. S.B. 100, sponsored by Sen. Susan Manchester (R-Waynesfield) would define a “nonprofit agricultural membership organization” as an organization that was incorporated in Ohio on or before December 31, 1919, to promote the interests of farms and that provides contractual healthcare benefit coverage exclusively with members of the organization and their families. Healthcare benefit coverage provided by such an organization, according to the proposal, is not “insurance” and is not subject to insurance regulations. The bill would also allow the nonprofit organizations to assume or reinsure the risks arising out of healthcare benefit coverage with a company authorized to provide insurance in Ohio.