| 2011 Agriculture-Related Legislation |
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| Creating New Law |
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Compiled by the Oregon Department of Agriculture The 2011 Oregon Legislative Session produced dozens of bills that will affect how farmers and ranchers conduct business. As with conditions nationally, the Oregon Legislature faced challenging budget decisions and funding priority options. This was one driving factor shaping the evolution of the Department of Agriculture’s budget and services over the past decade. Indeed, the department has been belt-tightening for years, always looking for efficiencies, responding to customer input, streamlining programs, reducing redundancies, improving use of technology, and striving to keep costs down. After years of doing more with less, ODA is now at the point of doing less with less. For the most part, ODA’s budget proceeded thru the 2011 legislative session avoiding drastic reductions. The greatest change was the shift in support for programs away from General Fund tax dollars to greater reliance on license fees and other fee-for-service activities. Fund shifts occurred in all four of ODA’s policy areas: Administration and Support, Food Safety, Natural Resources, and Agricultural Development and Marketing. ODA’s budget was also reduced as part of statewide reductions to control costs and bring expenditures into alignment with available revenue. As a result the agency lost a district veterinarian position, a renewable energy specialist, and various vacant positions. Some of the reductions in Lottery Funds were partially offset by the introduction of Pacific Coastal Salmon Recovery Funds for agricultural water quality efforts. There were also positive additions to ODA’s budget. - Over $660,000 and three positions were added to increase economic activity in the agriculture sector by finding solutions and providing marketing opportunities for the state’s food and agriculture industry both domestically and internationally.
- $250,000 was added to the Predator Control program for payments to USDA Wildlife Services, providing assistance to landowners to alleviate property damage caused by predatory animals.
- $100,000 was added for Wolf Compensation for grants to counties for compensation to livestock owners for losses due to wolf depredation and for financial assistance to implement nonlethal mitigation.
- About $65,000 was added for costs associated with implementing Oregon’s new hen cage requirements.
- Nearly $900,000 of Pacific Coastal Salmon Recovery Funds (federal dollars) and three positions were added to the Ag Water Quality Program to evaluate riparian conditions along agricultural lands, monitor ambient water quality sites, and to participate in state water quality monitoring efforts to measure progress by growers.
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Chart 1 shows ODA’s budget by fund type. The agency is funded by a combination of General Fund, Lottery Funds, Other Funds and Federal Funds. Note that nearly two-thirds of funding is from Other Funds, primarily fees that growers, retailers, and other entities pay for licensing, registration, inspecting, training, educating, certification and marketing efforts. The agency’s Lottery Funds are almost entirely from Measure 76 Parks and Natural Resources fund.
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Chart 2 shows how funds are spent, or the primary policy efforts being implemented: - About 24 cents of every dollar expended goes toward “ag development,” including marketing, certification programs, inspections of fresh produce for grade standards, trade shows, connecting buyers with sellers, addressing trade barriers, supervising price negotiations between growers and buyers, and others efforts to improve the economics of agriculture production and food processing in Oregon.
- Roughly 34 cents of every dollar expended is aimed at addressing natural resource issues ranging from invasive species, pests, and plant diseases to water quality oversight and proper use of ag chemicals.
- The other major area of work by ODA is that of food safety and consumer protection. Roughly 30 cents of every dollar spent goes to ensure a safe and wholesome food supply as it moves from producer to consumer. This includes ensuring accurate weights and measurement devices in all aspects of commerce and trade in Oregon (scales, meters, etc.), ensuring properly labeled animal feed, and the monitoring, control, and eradication of livestock disease outbreaks.
- The administrative cost for ODA is 12 cents on the dollar—a very competitive overhead for most government agencies or private businesses. This includes all business aspects of the department, accounting, payroll, licensing etc.; department leadership and policy development and advocacy; administration of the Farm Mediation Program; and many other special projects and efforts on behalf of the agriculture sector.
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Chart 3 shows the number of budgeted positions and FTEs (full-time equivalent jobs). From this chart it is evident that budget impacts have affected how ODA delivers services. Positions and related FTEs have dropped dramatically over the past decade, from 744 to 468 positions (-276), and 433 to 343 FTE (-90), necessitating increased use of technology, combined inspections, streamlined programs, and minimal overhead.
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| Bills |
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The 2011 Legislative Assembly passed the following bills; all have become law now in Oregon. You can click on the links to access a pdf version of the final bill.
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| Tax related |
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HB 3058: Fixes Double-taxation of Agricultural Cooperatives
Stops double taxation of Oregon agricultural cooperatives by fixing the 2003 definition of "single sales factor” so that “Oregon sales” do not include sales representing business done with or for members of the agricultural cooperative. Act applies to tax years beginning on or after January 1, 2011.
HB 2541: Inheritance Taxes
Provides a tax credit for natural resources estates on inheritance taxes. Act takes effect on the 91st day after Legislative adjournment.
HR 3672: Business Energy Tax Credits
Amends, sunsets and creates a number of tax credit programs within the Oregon Department of Energy. The bill is effective on the 91st day following adjournment of the legislative session and most changes take effect at that time, although some are retroactive. Changes to the Residential Energy Tax Credit (RETC) and the Biomass Producer and Collector Tax Credit (BPC) are effective beginning January 1, 2012.
http://www.oregon.gov/ENERGY/CONS/docs/HB3672summary.pdf
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| Wildlife related |
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HB 3560: Wolf Compensation Bill
Creates a wolf compensation program in conjunction with interested counties. The fund is to be used to provide grants to counties so they may compensate persons for loss or injury from wolf depredation, and to provide financial assistance to persons who implement management techniques and nonlethal methods to repel wolves. Describes conditions a county must meet to qualify for a grant, including an unspecified funding match. Allows the director of the Department of Agriculture to make rules to implement a county grant program. Takes effect on passage and signing by Governor.
HB 3636: Predator Control Funding
Each application for the purchase and issuance of a license, tag, or permit to hunt wildlife will allow the applicant to make a voluntary contribution for predatory animal control (to the extent allowable under federal and state law), in the county or counties in which the license, tag, or permit allows the person to hunt. First $45,000 collected goes to ODFW to modify system to associate donations to counties; grants will be phased in over time.
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| Water Related |
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SB 600: Maintaining Ag Waterways
Oregon Department of State Lands may establish by rule a general permit that allows farmers to remove up to 100 cubic yards of material from a waterway, including in essential indigenous anadromous salmonid habitat, for the purpose of maintaining drainage and protecting agricultural land. The department may waive the fees specified for removal taking place under the provisions of this section. Implementation may require rules by State Lands before effective.
HB 3408: Siting Reservoirs on Agricultural Land
Irrigation reservoirs, canals, delivery lines, and those structures and accessory operational facilities associated with an irrigation district are outright permitted in an agriculture zone. Effective on passage (June 2011).
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| Weeds and Pests |
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HB 2122: Regulation of Firewood Harvested Outside the Pacific Northwest
Provides ODA the authority to require that firewood harvested outside the Pacific Northwest be treated to kill pests and diseases before it can be transported or sold in Oregon. The goal is to protect Oregon's trees from harmful invasive species like emerald ash borer.
HB 3358: Weed Grants
Declares noxious weeds a threat to Oregon economy and requires department to establish a grant program to assist county weed control districts. Requires county to establish a weed control district and provide matching funds in order to be eligible for a grant.
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| Grass Seed Industry |
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HB 2159: Supporting Oregon's Grass Seed Industry
Clarifies contract requirements, payment terms and dates, and dealer licensing. The terms of a seed production or purchase contract must include: 1) The estimated date for seed delivery; (b) The terms and estimated date for the seed dealer to pay the seed grower; (c) The amount of grass seed to be purchased; and (d) The species, cultivars, and quality standards of the grass seed to be purchased. 2) If the contract does not settle the price of the grass seed, the contract is enforceable and price shall be determined as described in ORS 72.3050 (1) to (3). A seed purchase contract must require the seed dealer to make payment to the seed grower within 30 days after seed delivery. However, upon written mutual agreement of the seed grower and the seed dealer, the grower may extend the period available for the dealer to make payment. a) Payment to the producer is due no later than the earliest of the following: i) The dates specified in the contract. ii) Thirty days after delivery of the seed. iii) May 1 of the calendar year following the harvesting of the seed. When a production contract is signed prior to the seed being planted, the contract may contain payment due date terms that differ from the payment due date terms described above if the contract: 1) Provides for the price of the seed to be determined no later than March 15 of the calendar year following harvesting of the seed; 2) Requires the seed dealer to make a partial payment no later than March 15 of the calendar year following harvesting of the seed that is at least 40 percent of the full payment amount; and 3) States the date by which final payment for the seed is due. The law requires a Wholesale Seed Dealers License for anyone who contracts for production of grass seed for commercial purposes. The Oregon Department of Agriculture may adopt rules to require, as a condition of issuing a seed dealer license, that each seed dealer provide the department financial assurance for the performance by the seed dealer under any seed production contract or seed purchase contract entered into by the seed dealer. Applies to contracts entered into on or after June 2011.
SB 121: Seed Dealer License Fees
Raises Wholesale Seed Dealers license fee cap from $400.00 per year to $750.00 per year and the Retail Seed Dealers license fee from $40.00 to $75.00 per year. The agency will work with industry advisory groups to set the new license fee prior to the next licensing and renewal period in 2012.
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| Supporting Small Farms |
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HB 2336: Small Farm Exemption from Food Safety Licensing & Inspection
Supports small local farmers and the growth of famers' markets by modifying state laws to provide licensing and inspection exemptions for farmers whose annual sales at farmers markets and direct sales to the public total less than $20,000. The department will be drafting rules to implement the new law.
HB 2872: Small Farm Poultry Exemption
Allows the slaughter of up to 1,000 poultry annually by small producers for sale to the public. The grower may slaughter and process only poultry that are free from disease and have been raised by the grower since two weeks of age. The grower must slaughter the poultry at the business premises of the grower in a facility that meets the requirements in ORS 619.026 and any Oregon Department of Agriculture rules adopted under ORS 619.046. The grower may not allow other persons to use the facility. The grower must comply with any federal limitations or prohibitions on introducing the poultry or products produced from the poultry into interstate commerce.
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| Support Local/Regional Farmers |
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HB 2947: Honey Standards
Requires the State Department of Agriculture to adopt rules establishing standards of identity, quality, and labeling for honey sold in Oregon. Protects Oregon honey producers and bee-keepers who sometimes face competition from international honey companies selling a “honey type product,” which can include additives such as high-fructose corn syrup. Department must adopt rules.
HB 2800: Farm to School
Funds food-based, agriculture-based, and garden-based educational activities in school districts and supports schools in the purchase of foods produced or processed in Oregon. $200,000 allocated for the 2011-13 biennium. Takes effect July 1, 2011.
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| On-farm Activities |
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SB 960: Agri-Tourism
Expands the opportunities for farmers to supplement their farm income with agri-tourism activities, like special events and weddings, in compliance with county approvals and permits, incidental to farming activities. Takes effect on passage, June 2011.
HB 3280: Expands On-Site Winery Activities
Allows wineries to market and sell wine produced in conjunction with the winery, including wine tours; wine tastings in a tasting room or other location at the winery; wine clubs; and similar activities conducted for the primary purpose of promoting wine produced in conjunction with the winery; market and sell items directly related to the sale or promotion of wine produced in conjunction with the winery, the marketing and sale of which is incidental to retail sale of wine on-site, including food and beverages served by a limited service restaurant, as defined in ORS 624.010; and provide services, including private events, hosted by the winery or patrons of the winery, incidental to the retail sale of wine on-site that are limited to 25 days or fewer in a calendar year. The gross income of the winery from the sale of incidental items may not exceed 25 percent of the gross income from the on-site retail sale of wine produced in conjunction with the winery. Takes effect on passage, June 2011.
HB 2753: Guest Ranches in Eastern Oregon
Extends the “sunset” for provisions authorizing establishment of guest ranches from 2012 to 2018. Prohibits establishment of guest ranches in certain federally designated areas or in areas established by Congress for protection of scenic or ecological resources. Effective date January 1, 2012.
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| Livestock |
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SB 120:New Fee Schedule for Confined Animal Feeding Operations (CAFOs)
The current Confined Animal Feeding Operation (CAFO) permit has been in place for 25 years. Since that time, the size, complexity, and the regulatory requirements of CAFO permitted operations have changed. This legislation increases the annual permit fee paid by those who are primarily dairy, beef, poultry, and pork operators. The new law replaces the $25 annual fee previously charged for each permitted facility with a tiered annual fee based on size. The tiered system will establish a $100 fee for small CAFOs, a $200 fee for medium CAFOs, and a $300 fee for large CAFOs. Size is based on the number of animals and is defined by Oregon’s CAFO NPDES General Permit. Applies to annual permit periods beginning on or after May 15, 2011. The department shall issue a supplemental billing for additional fees owing by reason of the changes by law in the fee schedule.
SB805: Hen Cage Requirements
Requires the Oregon Department of Agriculture to adopt rules regulating confinement of laying hens. Prescribes minimum criteria for rules. Prohibits commercial owner/operators from confining a laying hen in an enclosure that does not comply with rules. Prohibits sale of eggs or egg products when a person knows or "reasonably" should know said eggs were produced from enclosures that do not comply with adopted rules. Prior to effective date of this Act (Jan 1, 2012), specifies standards that are equivalent to requirements for certification established in the United Egg Producers' Animal Husbandry Guidelines for U.S. Egg Laying Flocks. On or after effective date of this Act (Jan 1, 2012), specifies standards that are equivalent to requirements for certification of "enriched colony facility systems" established by the American Humane Association's farm animal welfare certification program. Upon renewal of egg handler's license, requires owner/operator to provide the department with a business plan describing how the commercial egg producer intends to comply with adopted rules. On or after July 1, 2015, the department is directed to inspect commercial egg producing farms at "reasonable times" to enforce provisions of this Act. The department is required to report annually to the Legislative Assembly about the rate of compliance with business plans that were submitted by producers to the department.
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| Land Use |
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SB 640: Siting of Fire Service Facility in EFU Zone
Authorizes division of land in an exclusive farm use zone in order to create a parcel smaller than the minimum lot or parcel size for fire service facilities that provide rural fire protection services. The bill authorizes the “governing body to establish other criteria that it considers necessary.” This may allow for approval criteria that could require consideration to farming operations. Effective on passage, June 2011.
SB 766: Designation of Significant Industrial Areas
Requires designation of at least five and not more than 15 regionally significant industrial areas. Allows for expedited permitting. Establishes Economic Recovery Review Council and authorizes the council to perform expedited site reviews for proposed industrial development projects. Eliminates council and funding if unemployment rate in Oregon falls below 6 percent. The new council established by this law will be similar to the Oregon Energy Facility Siting Council (EFSC). They (not local government) will have authority to expedite and approve industrial development in designated regionally significant industrial areas. Effective on passage, June 2011.
HB 2700: Removal or fill activity for construction or maintenance of a linear facility
Requires any person or entity applying for a removal or fill permit for construction or maintenance of a “linear facility,” to obtain: (a) The landowner’s consent; (b) A right, title or interest with respect to the property that is sufficient to undertake the removal or fill activity; or (c) A court order or judgment authorizing the use of the property. A linear facility is defined in the new law to include “any railway, highway, road, pipeline, water or sewer line, communication line, overhead or underground electrical transmission or distribution line or similar facility.” As these types of facilities most likely will involve agricultural lands, farmers and ranchers may be dealing with applications to conduct removal and/or fill operations within their property. Effective on passage, June 2011.
HB 3290: Farm Income Standard for Dwellings in EFU zones
In any rule adopted by the Land Conservation and Development Commission that establishes a farm income standard to determine whether a dwelling is customarily provided in conjunction with farm use on a tract, the commission shall allow a farm operator to satisfy the income standard by earning the required amount or more of farm income on the tract: (1) In at least three of the last five years; (2) In each of the last two years; or (3) Based on the average farm income earned on the tract in the best three of the last five years. Effective on passage, June 2011.
HB 3465: Guest Ranches
Authorizes expansion of an existing guest ranch to include 575 units of overnight accommodations and commercial uses. Exempts this development from statutes relating to guest ranches and other specified land use and land division statutes, statewide land use planning goals and provisions of Grant County’s acknowledged comprehensive plan and land use regulations. Declares emergency, effective on passage. Takes effect on passage, June 2011.
HB 3225: Transportation Facility in Reserve Area
Authorizes a county to take exception to a statewide planning goal to allow establishment of a transportation facility in an area designated as urban reserve. This law may counteract LCDC rules that would preclude any land uses in a reserve that would require an exception to statewide planning goals. Takes effect on passage, June 2011.
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| Miscellaneous |
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HB 2827: Winter Standards for Diesel Fuel
Allows the sale of diesel fuels containing additives between the dates of 10/01 through 2/28 of the following year that may lower the content of biodiesel below the 5 percent standard in order to address winter temperatures. Takes effect March 1, 2011.
SB 119: Shellfish Fee Increase
Commercial shellfish license fees have not increased since 1997 and shellfish cultivation fees have not increased since 1969. This bill raises the maximum fee the department can charge for growing, producing, harvesting or distributing shellfish and allows the department to increase annual shellfish cultivation fees for person using state lands for cultivation. The agency will work with industry advisory groups on rulemaking prior to the next licensing and renewal period.
SB 946: Abolishes Oregon Grains and Highland Bentgrass Commissions
Oregon has commodity commissions that operate under the department’s Commodity Commission Program. Commissions are funded through grower/producer assessments and they may fund research, marketing, and/or promotion programs on the commodity. This bill abolishes the Grains Commission and Highland Bentgrass Commission and transfers records and property to the Wheat Commission and Fine Fescue Commission.
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