Bill introduced to address on-farm bioenergy production

Proposal would ensure that on-farm bioenergy activities qualify for CAUV and are exempt from zoning regulation.

A legislative proposal in the Ohio House of Representatives would include on-farm bioenergy production activities in two key provisions of Ohio law:  qualification for differential tax assessment under the Current Agricultural Use Valuation program and exemption from local zoning authority.  Representatives Pryor and Domenick introduced  House Bill 485 in mid-April with assistance from the Ohio Department of Agriculture.  The bill was referred to the House Agriculture and Natural Resources Committee, but no other action on the bill has taken place.

The proposal addresses ”biodiesel production, biomass energy production, electric or heat energy production and biologically derived methane gas production”  where at least 50% of the starting material or feedstocks are from the same tract, lot or parcel on which the energy production takes place.  This 50% requirement targets on-farm energy production, where a farm is producing and processing the energy inputs, as long as no more than 50% of the supplementary inputs derive from other properties.

The bioenergy production activities that meet the 50% rule would be included in the CAUV’ program’s definition of “land devoted exclusively to agricultural use” in ORC 5713.30, thus guaranteeing eligibility for the CAUV property tax rate.  The bioenergy production activities would also become part of the definition of “agriculture” for purposes of county and township zoning, ORC 303.01 and ORC 519.01.  Because counties and townships have  limited zoning authority over “agriculture,” the proposal would ensure that a county or township could not use zoning authority to prohibit the qualifying bioenergy production activities. 

H.B. 485 is available online, here.

Ohio court allows township to use zoning to prohibit winery

Court says winery must grow more grapes to be defined as “agriculture.”

In a split decision, the Seventh Distict Court of Appeals has ruled in favor of a township in Mahoning County that wants to close down a small winery.  Milton Township claims that the winery violates township zoning regulations because it is located in a residential zoning district and does not qualify for the “agricultural exemption” from local zoning.  The court of common pleas and the majority on the appeals court agreed with the township, but a strong dissent by Court of Appeals Judge DeGenaro challenges the courts’ rulings and illustrates the need for clarity in Ohio’s rural zoning laws.

Myrddin Winery is a family owned business located on Lake Milton in Milton Township, on property that also contains a residence.  A free standing addition serves as the winery, and the property also has a vineyard containing 20 grape vines, with 12 vines producing grapes for harvest.   The Sperry family uses their grapes for wine, and must also import grapes and grape juices for their wine production–5% of their wine derives from their grape vines.  They make and bottle the wine on the premises.  Customers visit the winery to taste and purchase the wine and food items.

Before opening in 2005, the Sperry family asked the township zoning inspector if the township required any permits for the winery.  The zoning inspector advised that the family could begin operations immediately because the township did not require any permits.  In 2008, however, the township changed its opinion and notified the Sperrys that they were in violation of the township zoning resolution.  The township filed a complaint and requested the court to issue an injunction that would prohibit continued operation of the winery.

Two issues were before the Mahoning County trial court upon hearing the Myrddin Winery case:  1) whether a winery is “agriculture” for purposes of the agricultural exemption in Ohio zoning law, and 2) whether Ohio zoning law exempts wineries from local zoning regulation.  The trial court answered both questions in the negative.  The Sperry family appealed the decision to the Court of Appeals.

The court of appeals examined the Ohio Revised Code’s agricultural exemption from township zoning authority, but focused its decision on the statute’s definition of “agriculture” in O.R.C. 519.01, which states:

  • “As used in section 519.02 to 519.25 of the Revised Code, ‘agriculture’ includes farming; ranching; aquaculture; apiculture; horticulture; viticulture; animal husbandry, * * *; poultry husbandry * * *; dairy production; the production of field crops, tobacco, fruits, vegetables, nursery stock, ornamental shrubs, ornamental trees, flowers, sod, or mushrooms; timber; pasturage; any combination of the foregoing; the processing, drying, storage, and marketing of agricultural products when those activities are conducted in conjunction with, but are secondary to, such husbandry or production.”   (Emphasis added.)

As Judge DeGenaro points out in the dissent, the court should have relied on the actual agricultural exemption language contained in R.C. 519.21(A), which provides:

  • “Except as otherwise provided in division (B) of this section, sections 519.02 to 519.25 of the Revised Code confer no power on any township zoning commission, board of township trustees, or board of zoning appeals to prohibit the use of any land for agricultural purposes or the construction or use of buildings or structures incident to the use for agricultural purposes of the land on which such buildings or structures are located, including buildings or structures that are used primarily for vinting and selling wine and that are located on land any part of which is used for viticulture, and no zoning certificate shall be required for any such building or structure.” (Emphasis added.)

I agree with the dissent’s interpretation of the statute, which is that a township may not prohibit the use of buildings or structures that are used primarily for vinting and selling wine and that are located on land used for viticulture, which is the growing of grapes for wine.   Under this interpretation, Myrddin Winery could not be prohibited by way of zoning regulation.  However, the majority chose to read R.C. 519.21(A) to require that “any buildings or structures used primarily for vinting and selling wine” must also fit within the definition of “agriculture” in R.C. 519.01.  That definition includes “viticulture” and the processing and marketing of agricultural products, but only if processing and marketing of products is “secondary to” production.  Because Myrddin Winery was importing more grapes and grape juice for its wine than it was growing on the property, the court concluded that the processing and marketing of the wine was not secondary to production, but was the primary use of the property.  Thus, the agricultural exemption from zoning regulation would not apply and the township could prohibit the winery. 

In short, the court’s ruling requires a winery to ensure that production of  grapes is the primary use of the property and any processing and marketing of wine is the secondary use of the property.  Otherwise, local zoning can prohibit a winery.  This outcome is especially problematic for beginning  operations, because grape vines require many years of cultivation prior to successful harvest for wine production.  It also raises challenges for the winery landowner who must prove whether the grapes or the wine are the “primary” use of the property.  The specific exemption for wineries in 519.21(A) avoids these complications.

The Myrddin Winery case is one example of the confusion surrounding Ohio’s agricultural exemption from township and county zoning authority, and the court’s ruling strays too far from the intent of the law–to ensure that agricultural activities can persist outside of municpal areas.   The Sperry family has a strong basis for appealing the decision to the Ohio Supreme Court and seeking final clarification of the winery provision in the agricultural exemption.  But the Ohio legislature could alleviate the problem for landowners like the Sperry family, as well as townships and counties, by providing statutory clarification to the agricultural exemption.  Cases like the Myrddin winery case pervade the state and continuously raise the issue of which agricultural activities can and cannot be regulated by zoning.  With growing interests in agriculture and with state and federal policies that promote new types of agricultural production, direct marketing, and on-site processing by agricultural producers, Ohio will continue to experience conflicts between agriculture and local zoning regulation.  It’s time for the legislature to simplify and clarify the relationship between agricultural land uses and local zoning authority.

The Myrddin Winery case is Terry v. Sperry, 2010-Ohio-1299 (March 23, 2010), and is available here.

Progress on the Ohio Livestock Care Standards Board

Now that the Ohio legislature has enacted an implementation bill and Governor Strickland has announced board appointments, the Ohio Livestock Care Standards Board could soon begin developing standards for farm animal care in Ohio.  Voters approved Issue 2, the constiututional amendment creating the Ohio Livestock Care Standards Board, in November of 2009.

Last week, the governor signed Issue 2′s implementation bill (House Bill 414) after legislators wrangled with two different implementation proposals for more than two months.  A primary point of contention was funding–H.B. 414 originally proposed an increase of the commercial seed and feed inspection fee and allowed the transfer of at least $500,000 annually from the commercial seed and feed fund to the livestock care standards fund.  A Senate proposed bill, S.B. 233, would have provided the livestock care standards fund with $162, 280 transferred from the School Employees Health Care Board.  Neither provision survived in the final enacted law, which instead requires the director of the Ohio Department of Agriculture to rely on existing funds within the department until the legislature appropriates money for the livestock care standards fund.

The final approved bill also establishes board member terms and vacancies, allows board member travel reimbursements but does not allow compensation, and requires the board to meet at least three times per year.  The law requires the director of ODA to assist the board by hiring employees, submitting the board’s proposed rules for approval, enforcing the rules and investigating potential rule violations.  According to the law, the director must obtain permission to enter premises for inspection purposes.

Two provisions in the law address animal identification and organic production–these provisions were in the Senate’s version and were added to the final bill .   The new law states that the Ohio Livestock Care Standards Board may not establish a statewide animal identification system and clarifies that standards of the USDA’s national organic program will prevail if there is a conflict between the organic certification standards and the Ohio livestock care standards.

Despite recommendations to do so, the new law does not define the term ”family farmer,” but only reiterates the constitutional amendment’s requirement that three of the board members shall be “family farmers.”  Nor does the legislature guide the board on the meaning of the “well-being” of livestock, which the board must address in its standards and rules.  We hoped the new law would clarify whether “well-being” includes both physical and emotional well-being, an issue that could bring legal challenges in the future (see our earlier post on “Lessons from New Jersey”).   The implementation law does define “livestock” as equine raised for any purpose and the following animals if raised for human food and fiber purposes:  porcine (hogs), bovine (cattle, oxen, buffalo), caprine (goats), ovine (sheep), poultry, alpaca and llamas. 

Soon after Govenor Strickland signed H.B. 414, he announced his appointments to the Ohio Livestock Care Standards Board.  Information on the board appointments is available here.  Once the speaker of the house of representatives and president of the senate each make one of the two final board appointments, the board can begin its work of developing standards for the care and well-being of livestock in Ohio.

Meanwhile, proponents of a second ballot initiative on farm animal welfare are currently circulating around the state seeking signatures to place another proposal on the November general election ballot.  The proponents hope to tell the board, through a second constitutional amendment, a few standards that it must adopt, which includes prohibitions on certain types of confinement, requirements for humane killing of cows and pigs and restrictions against the sale or transport of downer cows.  See our earlier post on “Ohio may see a second constitutional amendment on farm animal welfare.”