Recent Blog Posts

Ohio waterway
By: Peggy Kirk Hall, Wednesday, January 06th, 2021

Written by Jeffrey Lewis, Attorney and Research Specialist, OSU Agricultural & Resource Law Program

Ohio is thirsty for some quality H2O, but the legislature has recently struggled with how to get it.  After debating two separate water quality bills for over a year, the Ohio House of Representatives and the Ohio Senate finally passed H.B. 7 in December.  The bi-partisan bill aims to improve water quality in Ohio’s lakes and rivers but doesn’t establish a permanent H2Ohio Trust Fund as the House had first proposed. 

Even so, H.B. 7 will help fund and implement Governor Mike DeWine’s H2Ohio program.  DeWine unveiled his water quality plan in 2019 to help reduce phosphorus runoff, prevent algal blooms, and prevent lead contamination in Ohio’s waterways. In July 2019, the Ohio General Assembly invested $172 million to fund the H2Ohio initiative.  H.B. 7 continues those efforts by creating a statewide Watershed Planning and Management Program and directing the Ohio Department of Agriculture to implement a pilot program to assist farmers and others in phosphorus reduction efforts.

Here’s a summary of the specifics included in H.B. 7, delivered to Governor DeWine on December 30 and awaiting his signature.

Watershed planning and management program

The new Watershed Planning and Management Program established by the bill aims to improve and protect Ohio’s lakes and rivers. The Director of Agriculture will be responsible for appointing watershed planning and management coordinators throughout the seven watershed districts in Ohio.  The coordinators will be responsible for identifying sources and areas of water with quality impairment, engaging in watershed planning, restoration, protection, and management activities, collaborating with other state agencies involved in water quality activities, and providing an annual report to the Director of Agriculture regarding their region’s watershed planning and management.

Certification program for farmers

A certification program for farmers in northwestern Ohio is already up and running at ODA.  Even so, H.B. 7 confirms that the legislature intends to collaborate with organizations representing agriculture, conservation, and the environment and institutions of higher education engaged in water quality research to establish a certification program for farmers who utilize practices designed to minimize impacts to water quality.  H.B. 7 requires the Director of Agriculture to undertake all necessary actions to ensure that assistance and funding are provided to farmers who participate in the certification program.

Watershed pilot program to reduce phosphorus in Ohio’s water

H.B. 7 authorizes but does not require the Department of Agriculture, in conjunction with the Lake Erie Commission, the Ohio Soil and Water Conservation Commission, and the Ohio State University Extension, to establish a pilot program that assists farmers, agricultural retailers, and soil and water conservation districts in reducing phosphorous and dissolved reactive phosphorous in a watershed.  The program, if established, would be funded from the Ohio Department of Agriculture’s budget for water quality initiatives.  Funding must be used for purchases of equipment, soil testing, implementation of variable rate technology, tributary monitoring, drainage management strategies, and implementation of nutrient best management practices.

Public record exemption for voluntary Nutrient Management Plans

Currently, a person who owns or operates agricultural land may develop and implement a voluntary nutrient management plan. A voluntary nutrient management plan provides for the proper application of fertilizer. An individual that implements a proper voluntary nutrient management plan receives an affirmative defense in any civil lawsuit involving the application of the fertilizer. In addition to the affirmative defense offered by using a voluntary nutrient management plan, H.B. 7 specifies that the information, data, and associated records used in the development and execution of a voluntary nutrient management plan is not a public record and is not subject to Ohio’s laws governing public records.

Regional water and sewer districts expanded authority

In addition to political subdivisions, regional water and sewer districts will have the authority to make loans, grants, and enter into cooperative agreements with any person, which includes a natural person, a firm, a partnership, an association, or a corporation, for water resource projects.

Also, regional water and sewer districts will be able to expand to whom they can offer discounts to for water and sewer services. Currently, districts can only offer discounts to persons who are 65 or older and who are of low or moderate income or qualify for the homestead exemption. H.B. 7 allows those discounts to be offered to any person who is considered of low or moderate income or that qualifies for the homestead exemption.

CAUV eligibility of land used for biofuel production

Unrelated to water quality, H.B. 7 also modifies the requirements that land used in biofuel production must meet in order to be valued for property taxes at its current agricultural use value (CAUV). Currently, land used for biofuel production qualifies for the CAUV program if:

  1. The production facility is located on, or on property adjoining, farmland under common ownership; and
  2. At least 50% of the feedstock used in the production comes from land under common ownership or leasehold.

H.B. 7 makes three changes:

  1. Instead of the 50% feedstock requirement, House Bill 7 requires that, of the feedstock used in biofuel production, at least 50% must be “agricultural feedstock” (manure or food waste) and at least 20% of the “agricultural feedstock” must come from land under common ownership or leasehold.
  2. None of the feedstock used in biofuel production can include human waste.
  3. The biofuel production facility may be part of, or adjacent to, farmland that is under common leasehold or common ownership.

 

Useful links:   Ohio General Assembly web page for H.B. 7.

USDA National Agricultural Library and National Agricultural Law Center

By: Peggy Kirk Hall, Monday, January 04th, 2021

The 2020 elections will likely be historically significant for U.S. agriculture, but what can we expect?  Our partner, the National Agricultural Law Center, will try to answer that question with a webinar on January 13 at noon.  The webinar will feature Hunt Shipman, principal and director at Cornerstone Government Affairs in Washington, DC.   Mr. Shipman will share his predictions on what's in store for agriculture, including:

  • Key appointments at USDA
  • Congressional committees positions
  • Implications for the next Farm Bill
  • International trade impacts
  • Changes in the federal and state regulatory environments

With nearly three decades of experience in Washington, Hunt Shipman has held a variety of positions in government and the private sector. Prior to joining Cornerstone, Hunt was a senior executive for the largest trade association serving the food and beverage industry, where he led the association’s government affairs and communications programs. From 2001 to 2003, Hunt was Deputy Under Secretary for Farm and Foreign Agricultural Services and served as the acting Deputy Under Secretary for Marketing and Regulatory Programs at the United States Department of Agriculture.  In this capacity, he led three agencies with over 18,000 employees stationed around the world, and administered over $31 billion in programs. Hunt was the Department of Agriculture’s principal negotiator with the Congress for the 2002 Farm Bill. Hunt also served as the staff director of the Senate Agriculture Committee, Professional Staff Member at the Senate Appropriations Committee, and on the personal staff of Senator Thad Cochran.

The webinar is free, but limited to the first 500 registrants.  To register, visit here.

National Agricultural Law Center and USDA National Agriculture Library

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

January 15th 10:00 – 11:30 am

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

Legislative updates

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!

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Fair rides
By: Peggy Kirk Hall, Monday, December 28th, 2020

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.

Debt authorization

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.

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By: Peggy Kirk Hall, Tuesday, December 22nd, 2020

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.

Crops

  • 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.

Food purchases

  • $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.

Farm stress

  • $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.

Nutrition

  • $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. 

USDA NAL 

By: Peggy Kirk Hall, Monday, December 21st, 2020

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 Jeffrey Lewispractice 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.

Ellen EssmanJeff’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 FaBen Brownrm 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.

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By: Peggy Kirk Hall, Thursday, December 17th, 2020

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
  • Arson
  • Aggravated arson
  • Breaking and entering
  • Criminal damaging or endangering
  • Criminal mischief
  • Criminal trespass
  • Injuring animals
  • Poisoning animals
  • Reckless destruction of crops or timber
  • Theft
  • Vandalism
  • 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. 

Barry Ward

Production costs for Ohio field crops are forecast to be slightly lower than last year with lower expenses for fertilizer, fuel and interest. Variable costs for corn in Ohio for 2021 are projected to range from $359 to $433 per acre depending on land productivity. Variable costs for 2021 Ohio soybeans are projected to range from $199 to $220 per acre. Wheat variable expenses for 2021 are projected to range from $162 to $191 per acre.

Grain prices currently used as assumptions in the 2021 crop enterprise budgets are $3.70/bushel for corn, $9.40/bushel for soybeans and $5.70/bushel for wheat. Projected returns above variable costs (contribution margin) range from $172 to $357 per acre for corn and $222 to $404 per acre for soybeans. Projected returns above variable costs for wheat range from $179 to $314 per acre.

Return to Land is a measure calculated to sometime assist in land rental and purchase decision making. The measure is calculated by starting with total receipts or revenue from the crop and subtracting all expenses except the land expense. Returns to Land for Ohio corn (Total receipts minus total costs except land cost) are projected to range from $11 to $184 per acre in 2021 depending on land production capabilities. Returns to land for Ohio soybeans are expected to range from $109 to $282 per acre depending on land production capabilities. Returns to land for wheat (not including straw or double-crop returns) are projected to range from $95 per acre to $222 per acre.

Total costs projected for trend line corn production in Ohio are estimated to be $761 per acre. This includes all variable costs as well as fixed costs (or overhead if you prefer) including machinery, labor, management and land costs. Fixed machinery costs of $75 per acre include depreciation, interest, insurance and housing. A land charge of $195 per acre is based on data from the Western Ohio Cropland Values and Cash Rents Survey Summary. Labor and management costs combined are calculated at $71 per acre. Details of budget assumptions and numbers can be found in footnotes included in each budget.

Total costs projected for trend line soybean production in Ohio are estimated to be $522 per acre. (Fixed machinery costs: $59 per acre, land charge: $195 per acre, labor and management costs combined: $45 per acre.)

Total costs projected for trend line wheat production in Ohio are estimated to be $459 per acre. (Fixed machinery costs: $34 per acre, land charge: $195 per acre, labor and management costs combined: $43 per acre.)

Budget projections for commodity crops for 2021 have been completed and posted to the Farm Office website: https://farmoffice.osu.edu/farm-mgt-tools/farm-budgets

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Barry Ward & Julie Strawser, OSU Income Tax Schools

Dealing with the tax provisions of the COVID-related legislation for both individuals and businesses are among the topics to be discussed during the upcoming Tax School workshop series offered throughout Ohio in November and December.

The annual series is designed to help tax preparers learn about federal tax law changes and updates for this year, as well as learn more about issues they may encounter when filing individual and small business 2020 tax returns.

The tax schools are intermediate-level courses that focus on interpreting tax regulations and changes in tax laws to help tax preparers, accountants, financial planners and attorneys advise their clients. The schools offer continuing education credit for certified public accountants, enrolled agents, attorneys, annual filing season preparers and certified financial planners.

This is another important year for tax education as the new COVID-related legislation creates some challenges for tax practitioners to prepare tax returns. These schools offer an excellent set of instructors with a great deal of experience and training along with a top reference workbook to prepare tax practitioners to best serve their clients during this ongoing process of incorporating recent tax law changes in completing tax returns.

The workbook alone is an extremely valuable reference as it offers over 700 pages of material including helpful tables and examples that will be valuable to practitioners. Sample chapters of the reference workbook can be found at: https://go.osu.edu/WorkbookChapters

Topics/chapters to be presented this year during the two-day tax schools include:

Financial Distress, S-Corporation Tax Issues, IRS Issues, Business Entity Issues, Agricultural and Natural Resource Issues, Retirement and Investment Issues, Individual Tax Issues, Business Tax Issues, Trusts and Estates, Rulings and Cases, New Legislation.

This year, OSU Income Tax Schools will offer both in-person schools and online virtual schools.

In person schools:

1.         Lima – November 2-3

Old Barn Restaurant and Grill

3175 W Elm Street, Lima, OH 45805

2.         Fremont – November 4-5

Ole Zim’s Wagon Shed

1375 State Route 590, Gibsonburg, OH 43431

3.         Ashland – November 11-12 SOLD OUT

Ashland University

John C. Meyers Convocation Center

820 Clermont Ave., Ashland, OH  44805

4.         Dayton – November 17-18

Presidential Banquet Center

4548 Presidential Way, Kettering, OH  45429

5.         Columbus – December 10-11 SOLD OUT

Nationwide & Ohio Farm Bureau 4-H Center

2201 Fred Taylor Dr., Columbus, OH 43221

Virtual Online Schools:

1.         Webinar (Zoom)

November 9, 13, 16 and 19

Each Day 12:30 – 5pm

Zoom Webinar

2.         Livestream (Zoom)

December 10-11

Livestream of Columbus Tax School Location via Zoom

In addition to the tax schools, the program offers a separate, two-hour ethics webinar that will broadcast Dec. 4 at 10 a.m. The webinar is $25 for school attendees and $50 for non-attendees and is approved by the IRS and the Ohio Accountancy Board for continuing education credit

Register two weeks prior to the school date and receive the two-day tax school early-bird registration fee of $375.  This includes all materials, lunches and refreshments. The deadline to enroll is 10 business days prior to the date of each school. After the school deadline, the fee increases to $425.

Additionally, the 2020 RIA Federal Tax Handbook is available to purchase by participants for a discounted fee of $45 each. Registration information and the online registration portal can be found online at:

http://go.osu.edu/2020tax

A webinar on Ag Tax Issues will be held Dec. 18 from 8:45 a.m. to 3:30 p.m.

If you are a tax practitioner that represents farmers or rural landowners or are a farmer or farmland owner that prepares your own taxes, this five-hour webinar is for you. It will focus on key topics and new legislation related specifically to those income tax returns.

Registration, which includes the Ag Tax Issues workbook, is $150. Register by mail or on-line at http://go.osu.edu/agissues2020

Participants may contact Ward at 614-688-3959, ward.8@osu.edu or Julie Strawser 614-292-2433, strawser.35@osu.edu for more information.

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Wedding sign
By: Peggy Kirk Hall, Wednesday, October 07th, 2020

When does the business of hosting weddings on a farm qualify as “agritourism” under Ohio law?  That was the question faced by Ohio’s Second District Court of Appeals in a legal battle between Caesarscreek Township and the owners of a farm property in Greene County.  The answer to the question is important because local zoning can’t prohibit the hosting of weddings and similar events if they fall under Ohio’s definition of “agritourism.”  Those that don’t qualify as “agritourism” are subject to local zoning prohibitions and regulations.  According to the court’s recent decision, the determination depends largely upon the facts of the situation, but merely taking place on an agricultural property does not automatically qualify a wedding or event as “agritourism.”

The case regards the Lusardis, who own a 13.5 acre property in Caesarscreek Township containing a pole barn and outbuilding, a one-acre pond, several acres of woods, and an eight acre hayfield on which the Lusardis had produced hay for several years.  Their plan was to offer corn mazes, hayrides and celebratory events like weddings and receptions on the property.  To do so, the Lusardis had to demonstrate to the township’s Board of Zoning Appeals (BZA) that their activities fit within Ohio’s definition of “agritourism” and thus must be allowed according to Ohio law.   That definition in ORC 901.80 states:

“Agritourism means an agriculturally related educational, entertainment, historical, cultural, or recreational activity, including you-pick operations or farm markets, conducted on a farm that allows or invites members of the general public to observe, participate in or enjoy that activity.”

In applying the definition of agritourism to its local zoning, Caesarscreek Township requires an agritourism provider to explain how the “educational, entertainment, historical, cultural or recreational” activities it plans to offer are “agriculturally related” to the property and the surrounding agricultural community.  In their agritourism application with the township, the Lusardis explained that guests could use the property to celebrate an agriculturally themed event, enjoy the scenery, hay fields and woods, learn about plants and wildlife, have bonfires, play corn hole, fish, and get married outside, in the woods, or in the hayfield.  The township zoning inspector, however, testified to the BZA that he did not see a relationship between weddings and receptions and the Lusardi property itself.  A wedding or reception would not have a “basic relationship” to the existing agricultural use of the property or the surrounding area and the agricultural use of the property was incidental, at best, to the wedding and reception business, argued the zoning inspector.

The township BZA agreed with the zoning inspector.  It determined that the Lusardi’s corn maze and hayride activities qualified as agritourism, but held that any celebratory events such as weddings would not be “agriculturally related” to the property and thus did not fit within the definition of agritourism and could not take place on the property.  The Lusardis appealed the BZA’s decision to the Greene County Court of Common Pleas, whose duty under Ohio law was to determine whether the BZA’s conclusion was “unconstitutional, illegal, arbitrary, capricious, unreasonable or unsupported by the preponderance of substantial, reliable, and probative evidence on the whole record.”  The common pleas court found the BZA’s conclusion reasonable and upheld the decision.  The BZA’s determination that weddings don’t bear a general relevance to agriculture was understandable, whereas corn mazes and hay rides do bear a reasonable relationship to agriculture, the court stated.

The Lusardis appealed the common pleas court decision to the Ohio Court of Appeals.  Its duty in reviewing the case was to determine whether the common pleas court had abused its discretion by making a judgment on a question of law that is “unreasonable, arbitrary or unconscionable.”  The appellate court concluded that the common pleas court had not abused its discretion by affirming the BZA decision.  Agreeing that it was reasonable for the BZA to conclude that the celebratory events were not sufficiently related to the agricultural property, the court stated that “just because an activity is on agricultural property does not make it “agritourism” and is not, by itself, enough to make the activity “agriculturally related.” 

The “what does ‘agriculturally related’ mean?” question is one we’ve pondered since the Ohio legislature created the definition of agritourism in 2016.   An important rule to draw from this case is that the answer must be made on a case-by-case basis.  The Lusardis asked the court of appeals to decide whether any celebratory event on an agricultural property would be agriculturally related and would therefore constitute “agritourism” as a matter of law, but the court refused to do so.  “Whether a particular activity constitutes “agritourism” is an issue that shades to gray quite quickly,” stated the court.  “Given the great variety of factual situations, we decline to rule on whether celebratory events constitute “agritourism” as a matter of law.”

Also noteworthy is the court’s attention to the BZA’s analysis of the activities that were to take place on the Lusardi property.  The BZA pointed to a lack of evidence that any crops or flowers grown on the property would be used in the events.  Also remiss was evidence that the only agricultural crop grown on the property—hay—was somehow connected to the celebratory events that would take place.  The court observed that these evidentiary flaws supported the BZA’s conclusion that the Lusardis were proposing an event venue with an incidental theme rather than an agricultural activity with an incidental event. 

Wedding barn issues have been a cause of controversy in recent years.  The Lusardi v. Caesarscreek Township decision follows an Ohio Supreme Court case earlier this year regarding whether a wedding barn fit within the agricultural exemption from zoning for buildings and structures used “primarily for vinting and selling wine.”  In that case, the Supreme Court determined that making and selling wine was the primary use of the barn and that weddings and events were incidental, yet were related to the production because event guests had to purchase the wine produced at the farm.  Taken together, these cases illustrate the importance Ohio’s agricultural zoning exemption places on production activities.  Where agricultural goods are being produced and sold, additional incidental activities such as celebratory events that are related to agricultural production will likely fall under the agricultural exemption.  But as the Lusardi case illustrates, local zoning may prohibit celebratory events that don’t have a clear connection to agricultural production and instead appear to be the primary rather than incidental use of the property.

Read the case of Lusardi v. Caesarscreek Township Board of Zoning Appeals here.

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