Category: Ag Law

The recent U.S. Supreme Court ruling in Sackett v. EPA appears to settle the question of where water ends and land begins under Section 404 of the federal Clean Water Act (CWA). The ruling that the CWA only covers wetlands with a continuous surface connection to a traditionally navigable waterway has been heralded by farming interests for providing clarity to farmers, presumably on decisions whether to alter wetland features on their lands. However, farmers and landowners should be reminded that wetlands conversion still may carry risks under state and other federal law, and that Sackett should not be taken as an indication that other wetlands protections will not be enforced on wetlands no longer covered by the CWA.

Importantly, the Sackett surface connection rule does not change the federal government’s wetlands policy and regulation authority under the Swampbuster provision of the 1985 Farm Bill. Swampbuster denies eligibility for federal subsidy programs to farmers and landowners who convert wetlands, carving out an exception for wetlands converted prior to 1986. Though the Natural Resources Conservation Service (NCRS) may refer to the Army Corps of Engineers’ Wetlands Delineation Manual (the guidance document on CWA 404 determinations)  in its own determinations, the Sackett decision does not restrict NRCS to the “surface connection rule’ when identifying wetlands for purposes of Swampbuster benefit determinations.

NRCS wetlands authority under Swampbuster was recently addressed by the 9th Circuit in Foster v. USDA. The case supports the policy that farmers can apply for reconsideration of wetlands designation, which obligates NRCS to make a new determination.

Additionally, non-CWA wetlands may still benefit from state protections. Most southern states have laws protecting isolated wetlands, though North Carolina recently aligned state wetlands definitions with the new post-Sackett rules (Tennessee has introduced a similar measure). In short, though Sackett will likely result in fewer determinations of wetlands for purposes of CWA 404 permits, the decision should not be taken by farmers as an invitation to self-determine wetland status and the resulting consequences of draining or filling habitually wet areas on their farms.

---

Brannon, Robert Andrew. “Wetlands Protection under Swampbuster.” Southern Ag Today 3(43.5). October 27, 2023. Permalink

During the 2023 legislative session, the issue of restricting foreign investments and ownership in U.S. land, especially agricultural land, emerged or reemerged in the majority of states. This reemerging interest in restricting foreign investments in U.S. land is partly due to the purchase of land near U.S. Air Force bases in Texas and North Dakota by two Chinese-owned companies.

Currently, there are approximately twenty-four states that specifically limit or restrict foreign individuals, foreign business entities, and/or foreign governments from acquiring or owning an interest in farmland within their state, which is up from fourteen states in 2022. During the 2023 legislative session, ten states enacted a new law restricting certain foreign investments in land located within their state, and two states—North Dakota and Oklahoma—amended their laws that prohibit certain foreign purchases of land. Although twenty-four states now have some type of restriction, state laws vary widely, and some states restrict only certain purchases. For example, the majority of foreign ownership laws enacted in 2023 seek to restrict investments from specific countries, particularly China, Iran, North Korea, and Russia.

Aside from state action, Congress is also considering several proposals that seek to establish a national restriction on certain foreign investments in U.S. land. Specifically, the Senate recently passed an amendment to its version of the bicameral National Defense Authorization Act (“NDAA”) which seeks to prevent certain investments in U.S. agricultural businesses and land by China, Iran, North Korea, and Russia. The Senate version of NDAA is currently being reconciled with the House version of the bill.

Brown, Micah. “Ten More States Pass Foreign Land Ownership Laws This Year.” Southern Ag Today 3(38.5). September 22, 2023. Permalink

The EPA released an updated regulation defining “waters of the United States” (WOTUS) on August 29, 2023, which significantly narrows the scope of the previous rule.  WOTUS has been a continual issue facing landowners since the passage/update of the Clean Water Act (CWA) in 1972.  

But what is WOTUS and why does it matter?  WOTUS is a definition that determines where the federal government has jurisdiction to enforce the CWA.  

The CWA extends to “navigable waters,” and navigable waters are defined as “waters of the United States.” The definition did not provide a great deal of clarity on where and when the U.S. Environmental Protection Agency (EPA) or the U.S. Army Corps of Engineers (the Corps) could enforce the CWA against private landowners.  Courts and successive administrations have grappled with this definition for years because the definition of WOTUS matters greatly.  The broader and more expansive the definition, the more types of water bodies will be covered, extending the jurisdiction over more property.  Providing a bright-line definition on where the CWA applies has proven to be elusive. 

            On May 25^th, 2023, the United States Supreme Court (Court) ruled in Sackett v. EPA, narrowing the types of water bodies that can be considered to fall under the jurisdiction of the CWA.  The updated regulation released on August 29^th incorporated the Court’s findings in the Sackett case and significantly narrowed the scope of where the CWA can be applied (to read a summary of the changes, click here). 

            A number of lawsuits challenging the earlier version of this rule remain pending and other challenges to the revised regulation could be initiated. There will also be questions to work through as the agencies begin implementing the new rule across the country.  Still, the new rule represents a substantial change to a definition that has garnered much attention over the past four decades.

To learn more about the updated regulation, click here.

To learn more about the Sackett decision, click here.

To learn more about the Clean Water Act, click here.

The one-year anniversary date of the current highly pathogenic avian influenza (HPAI) outbreak passed in February 2023 and much of the U.S. agricultural industry hardly noticed. Animal health professionals certainly did as the wild fowl migration which they identified as the trigger of the diseases’ spread was rapidly approaching.  According to USDA’s database of HPAI 2022/2023 Confirmed Detections, January 2023 saw three scattered detections in commercial broilers or turkeys (Iowa, Tennessee and California), and two Kansas gamebird operations. The 2023 Spring months passed and by May 2023, commercial flock detections were zero and have remained so. The current outbreak seems to be at an end for the commercial poultry sector. 

All indications are that the USDA Animal and Plant Health Inspection Service’s (APHIS) HPAI Response Plan, otherwise simply known as “The Red Book,” and all the other USDA policy and guidance documents available to explain how and what USDA does in the event of an HPAI outbreak, served its function exceedingly well in explaining, coordinating and structuring USDA’s activities. For those entities who owned birds euthanized or eggs destroyed in the disease response activities, perhaps the most important USDA activity is that of indemnity (compensation for destroyed property) and compensation (reimbursement for services provided in the virus elimination process on the affected premises). 

This outbreak brought to the surface two key limitations of the current indemnification and compensation process: (1) contract growers without an ownership interest in the birds or eggs destroyed are not eligible despite a complete loss of revenue until production can resume after quarantine restrictions are lifted; and (2) ancillary business operations, e.g. breeders supplying chicks and poults, are not eligible for any compensation due to lost revenue from the cessation of production at infected or other premises under quarantine restrictions. This limitation is induced by the concentric circles of quarantine restrictions that stop product movement not only to infected premises but also to any poultry operation within the entire quarantined control zone imposed around an infected premise, i.e. the  “induced impact” of lost revenue from an infection. 

Relief in one state highly impacted by this HPAI outbreak, Pennsylvania (31 commercial flocks and 4.6 million birds euthanized), came in the form of an appropriation by the Pennsylvania General Assembly (Act 54 of 2022) of $25 million dollars for the “Highly Pathogenic Avian Influenza Recovery Reimbursement Grant” program. Administered by the Pennsylvania Department of Agriculture, it is intended to “provide reimbursement to farms, integrators, and allied industries directly impacted by HPAI. This covers those who incurred demonstrable financial losses due to inclusion in a control or quarantine zone.”  

The program has been the subject to four completed rounds of funding conducted between September 2022 and June 2023, with a fifth round of applications being accepted until October 5, 2023. Losses compensable have included loss of income, payroll costs, costs related to the continuation of group health care benefits and health insurance premiums, mortgage interest payments, rent payments, utility payments, and working capital for the purpose of covering costs of re-opening farming operations after being fully or partially closed due to the state or federally mandated quarantine period. 

A federal bill attempting to address the same gap on a nationwide level, called the Healthy Poultry Assistance and Indemnification Act of 2023, has been introduced as S. 2235 by Senator Chris Coons (Del.).  It is presently in the Senate Committee on Agriculture, Nutrition, and Forestry.  

Time will tell if other states may begin to address this gap or whether a federal solution may be successfully implemented. 

Duer, Brook, and Paul Goeringer. “HPAI in 2023: “Induced” Losses Leave a Gap in the Federal Indemnity Scheme.” Southern Ag Today 3(36.5). September 8, 2023. Permalink

What happened to all the Black Farmers? As the 2023 Farm Bill approaches, this question has been asked a lot, and it should be since Black farmers have declined by more than 96 percent since 1920, with there being 926,000 Black-operated farms in that very year.

In order to understand why this has happened, the first step may be analyzing how exactly Black farmers finance their farm operations. This question is imperative when determining why there has been a drastic decline in Black farmers. To understand how Black farmers are funding their farm operations and the barriers to obtaining capital, the Policy Center set out to gather this information by bringing together 1890 Land-Grant Institutions in the nine states with the highest concentration of Black farmers to conduct in-depth research on these issues. 

Each state participating in this project was asked to survey at least 100 Black farmers. The survey found that the top method for funding their farms was personal cash followed by ownership. This confirmed that Black farmers are not accessing loans to build their farm business. Access to capital for black farmers is a serious issue and the results showed that effective access to capital for black farmers is very limited. Consequently, black farmers applied for few loans and obtained a very low share of their operational capital from external sources. 

There are many factors and complex interactions that add to this issue. Some levels of discrimination existed, as mentioned by some farmers in their response, but the fundamental causes of the issue go far beyond just discrimination. USDA has created new programming and initiatives but has not included actions to assist the Black farmer in catching up to farmers who have always received help, have a complete understanding, and thrive. 

Things, such as a simplification of the application process, reduction of the down payment/credit needed, and help with the application process and getting farm numbers could increase the number of farmers applying for and receiving funding are things that can create changes for Black farmers, but there are clear systemic changes that needs to take place as well. 

To access the full study, contact Dr. Kara Woods, research analyst at the Socially Disadvantaged Farmers and Ranchers Policy Research Center at Alcorn State University, at kawoods@alcorn.edu.