Month: April 2013

Congress Delays Requirement for Farm Oil Spill Prevention Plans

SPCC Rule will not be enforced against farms until September of 2013

Peggy Kirk Hall, Asst. Professor, OSU Extension Agricultural & Resource Law Program

Many farms are scrambling to meet the upcoming May 10, 2013, deadline for having an oil spill containment plan (SPCC plan) as required by EPA regulations,  but Congress has quietly delayed the U.S. EPA’s ability to enforce the regulation.   Amendment 29 to the recently enacted funding bill, H.R. 933, states that the U.S. EPA may not use any of its funds to enforce the SPCC rule against farms for a period of 180 days, until after September 26, 2013.

The purpose of the U.S. EPA’s Spill Prevention Control and Countermeasures (SPCC) program is to help facilities and farms prevent a discharge of oil into navigable waterways.  Program regulations affect farms that store more than 1,320 gallons of oil or oil products in aboveground containers or more than 42,000 gallons in completely buried containers–those farms are required to develop, maintain and implement an oil spill prevention plan by May 10, 2013.

The recent action by Congress, however, prevents the EPA from enforcing the plan until late September.  In the meantime, congressional efforts will focus on revising the SPCC rule as it applies to farm SPCC plans.  Senator Inhofe (OK), who sponsored the amendment to delay enforcement, has already co-sponsored a bill (S. 496)  with Senators Pryor (AK) and Boozman (AK) to provide more exemptions for small farms and help farms reduce compliance costs.

What should farmers do now about SPCC plans?  The future of the SPCC rule is uncertain, but we do know that the current deadline of May 10 can’t be enforced by the EPA.  Farmers who are currently subject to the regulation must decide whether to proceed with compliance and be prepared for a possible September deadline, or wait and see if Congress changes SPCC requirements before the end of September.  If a farmer is subject to an attempted enforcement action after the May 10 deadline, contact legal counsel right away.  For those who have already developed SPCC plans, be assured that the plan may still be required in the future and could also be a useful tool for  reacting to an oil spill that could contaminate a waterway and reducing your environmental liability risk.   For more information about the SPCC rule, visit here.

Burning Crop Debris is Legal, isn’t it?

Peggy Kirk Hall, Asst. Professor, OSU Extension Agricultural & Resource Law

It’s the time of year when farmers clear fields and fence rows of corn stalks, branches and other debris and use a common management practice–piling the debris and burning it in the field.  Because outdoor fires such as this create air emissions and wildfire concerns, Ohio has laws that regulate open burning activities.   Burning certain materials at certain times in certain places may violate the open burning laws and cause a health or safety issue.  It’s important to know when open burning of crop debris and field residue is permissible, and to take precautions to minimize risk and liability.

There are several areas of law in Ohio that address open burning.  The Ohio Environmental Protection Agency (OEPA) oversees regulations on the open burning of materials that may produce harmful air emissions that affect human and environmental health.  Ohio also has laws that regulate open burning to minimize the danger of wildfires; these laws may be enforced by the Ohio Department of Natural Resources (ODNR) Division of Forestry or local law officials.   Additionally, a local government might have local ordinances that regulate open burning.

In regards to crop debris in farm fields, it is typically permissible for a farmer to burn the debris.  However, the law creates duties to conduct the burn responsibly and imposes some conditions on what, where and when to burn.  Violating the laws can lead to criminal charges, fines and civil liability to harmed parties.

What can you burn?

Ohio law allows the burning of “agricultural wastes” under certain conditions.  The definition of agricultural waste includes materials such as crop debris, as well as other materials.   According to Ohio law, agricultural waste includes:

  • Waste material generated by crop, horticultural, or livestock production practices, landscape wastes that are generated in agricultural activities and woody debris and plant matter from stream flooding.
  • Bags, cartons, structural materials and containers for pesticides, insecticides, fungicides, rodenticides, miticides, nematocides, fumigants, herbicides, seed disinfectants and defoliants, if the manufacturer has identified open burning as a safe disposal procedure.  Farmers may add seed bags and cartons to the burn pile as long as the label states that open burning of the materials is safe.

Agricultural waste does not include:

  • Standing or fallen buildings, building materials, food waste, dead animals, materials made from petroleum or containing plastic, rubber, grease or asphalt.   A farmer may not add these materials to the burn pile.
  • Debris resulting from the clearing of land for new agricultural, residential, commercial or industrial development—this type of waste is defined as “land clearing waste.”  Open burning of land clearing waste requires prior written notification to Ohio EPA.

Where can you burn?

Several regulations determine acceptable locations for burning crop debris and other agricultural waste:

  • Agricultural waste may only be burned on the property where the waste is generated; the waste may not be taken to a different property for burning and a farmer cannot receive and burn waste from another property.
  • If the burning is inside a “restricted area,” then prior written notice to Ohio EPA must be provided at least ten days in advance of the burning.  A “restricted area” is an area where there is higher population density.  The law defines a restricted area as:
    • Any area inside city or village limits.
    • Any area within the 1,000-foot zone outside of a city or village with a population of 1,000 to 10,000.
    • Any area within a one-mile zone outside of a city or village with a population of more than 10,000.
    • The fire must occur in a location where it will not obscure visibility for roadways, railroad tracks or air fields.
    • The fire must be more than 1,000 feet from any neighboring building inhabited by people, such as homes, stores, restaurants, schools, etc.

When can you burn?

There are definite times when burning of crop debris and other agricultural waste is not permitted unless certain conditions are met.

  • Ohio’s wildfire laws limit open burning in rural areas during the months of March, April, May, October and November, when wildfire risk is highest due to dry vegetative conditions and dry winds.  During these months, open burning in rural areas is completely prohibited between the hours of 6 a.m. and 6 p.m., when volunteer fire departments are not well-staffed.  One exception to this prohibition applies to farmers:
    • Open burning may occur in a plowed field or garden, if the burn pile is at least 200 feet from any woodland, brush land or field containing dry grass or other flammable material.  If a farmer can’t meet this 200 foot buffer zone requirement, the farmer should wait until after 6 p.m. to conduct the burn.
    • Open burning should only occur when atmospheric conditions will readily dissipate any smoke and potential contaminants.  If weather conditions are foggy, rainy or causing air inversions, smoke and contaminants will not readily disperse and the farmer should not burn the materials.
    • Even if all other legal requirements for open burning are met, open burning is not allowed when air pollution warnings, alerts or emergencies are in effect.

What about prescribed burning?

Both the ODNR and Ohio EPA have authority over prescribed burning—intentional burns for horticultural, silvicultural, range or wildlife management practices.  Prescribed burning requires prior written permission from Ohio EPA and–if taking place during March, April, May, October or November–the burn must be conducted by a Certified Prescribed Fire Manager with permission by the Chief of ODNR’s Division of Forestry.  See the Division of Forestry’s website for more information on becoming a Certified Prescribed Fire Manager and requesting permission for prescribed burns.

Prior notice to Ohio EPA

For burns that require advance notice to the Ohio EPA, farmers may use the notification form on the Ohio EPA website at http://www.epa.ohio.gov/dapc/general/openburning.  The form seeks information about what will be burned and when and where the burn will take place; this allows the EPA to ensure that the burn is permissible.

Legal duties for conducting open burning

Ohio law also imposes duties for managing open burns.   Ohio Revised Code 1503.18 establishes a duty to prevent fire escape.   The law requires any person who starts a fire near trees, woodland or brush land to take steps to prevent the fire from escaping.  All leaves, grass, wood and inflammable material surrounding the place must be removed to a safe distance and all other reasonable precautions must be taken to keep the fire under control.   The law also states that a person should extinguish or safely cover an open fire before leaving the area.

Ohio EPA’s regulations impose several other duties for managing burns.  As mentioned above, burning of agricultural waste should take place at least 1,000 feet from any neighbor’s inhabited buildings. The wastes should be stacked and dried to provide the best practicable condition for efficient burning and weather conditions should not prevent dispersion of the smoke and emissions.  If the size of an agricultural waste pile exceeds 20 feet in diameter by 10 feet in height (or 4,000 cubic feet),  the farmer must provide written notification of the burn to the Ohio EPA at least ten days before burning.

Local laws

The above analysis explains Ohio’s laws on open burning; remember that the local government might have a local law that also regulates burning activities.  Check with your local fire department to know whether any local regulations apply to the situation.

What if a farmer violates open burning laws?

Violation of the open burning laws creates several risks for farmers.  Ohio EPA has the authority to issue fines of up to $1,000 per day per offense.  The EPA states that it takes enforcement action against repeat offenders or violations that cause significant harmful emissions.  Otherwise, EPA enforcement officers prefer to issue warnings to first-time offenders and educate on how to conduct open burns that minimize pollution impacts.  EPA enforcement officers regularly patrol their districts, investigate fires they see and investigate complaints from neighbors or others who report burning activities.  According to the EPA, the most common violations by farmers include burning substances that are not “agricultural wastes” such as tires and plastics, failing to meet the 1,000 foot setback requirement and burning waste from another property.

Conducting open burns that violate Ohio’s wildfire prevention laws can result in third degree misdemeanor charges, which carry penalties of up to $500 and 60 days of jail time per violation.   Any person may report a potential illegal burn that creates wildfire risks to the local law enforcement or Division of Forestry.

Equally and perhaps more important is the risk of civil liability from an open burning incident.  We all know that the “burn police” can’t observe everyone all the time, but civil liability doesn’t require intensive monitoring—it requires harm.  Where an open burn causes harm to people or property, civil liability may arise.  An open burn that reduces roadway visibility and results in an auto accident, escapes the property and harms neighbors or neighboring property or significantly interferes with other owners’ property use could result in a negligence or nuisance lawsuit.  The farmer who violated open burning laws or failed to properly manage the fire could be liable for all harm resulting from the fire.

For more information on Ohio’s open burning laws, visit the websites of the Ohio EPA Division of Air Pollution Control and ODNR Division of Forestry.

Farm Fuel Storage Compliance Date Approaching

By: Amanda Douridas, Extension Educator

On May 10, 2013 farms must have prepared and implemented their Spill Prevention, Control and Countermeasure (SPCC) Plans if they fall under regulation by the EPA. Farms with 1,320 gallons above ground storage or 42,000 gallons below ground storage of oil or oil products meet the requirements to have a SPCC. This includes all containers 55 gallons or greater. The implementation date was delayed from its original date in the fall of 2011.

Two basic requirements need to be met to comply. The first is having sufficient secondary containment for storage and transfer areas to contain any spillage. The containment area is designed to prevent discharge until cleanup can occur and is usually designed to hold 110 percent of the largest container or tank in the area. The second requirement is to prepare and implement a written SPCC plan that covers all of the steps the farm has taken to prevent discharges into the environment. The plan must be updated every 5 years or in the event of a major re-design of the area. Any employees handling oil and petroleum products must be trained on what the plan involves.

Some farms may need to have their plan approved by a Professional Engineer. If on farm storage is between 1,320 and 10,000 gallons, you are allowed to prepare and self-certify if you have not had any spills of 1,000 gallons or more at once or less than two discharges of more than 42 gallons in the last year. Also, if secondary containment is not practical or alternative methods of diking or secondary containment are to be used, a Professional Engineer will need to certify.

On completion the plan must be kept on site. It does not need to be sent to EPA but may be requested if a major discharge event occurs. More in-depth information on creating a plan for farms can be found at the SPCC for Agriculture page on the EPA site: http://www.epa.gov/emergencies/content/spcc/spcc_ag.htm#spcc. This fact sheet also provides a good overview: http://www.epa.ohio.gov/portals/41/sb/publications/spcc.pdf.  Additionally more information can be found in a previous OAM article located at  http://ohioagmanager.osu.edu/uncategorized/fuel-storage-containment-required

A Landowners Guide to Understanding Recommended Pipeline Standards and Construction Specifications

By: Chris Zoller, Extension Educator, ANR, and Peggy Hall, Director, Agricultural & Resource Law, Ohio State University Extension

 With the drilling of gas wells comes the need to establish pipelines to move the gas from the point of drilling to the end users.  Landowners across Ohio are being asked to sign agreements allowing companies to purchase acreage for pipeline construction.  A new fact sheet provides landowners with an overview of items to consider regarding standards and construction specifications related to pipelines. This fact sheet is intended for educational purposes only.  We strongly encourage landowners who may be considering negotiating a pipeline easement to consult with an attorney familiar with such negotiations. Download the factsheet by clicking A Landowners Guide to Understanding Recommended Standards and Construction of Pipeline Standards 2012 2012.

Considerations When Evaluating a Pipeline Easement Agreement

By: Chris Zoller, Extension Educator, ANR; Peggy Hall, Director, Agriculture & Resource Law Program; and  Mark Landefeld, Extension Educator, ANR 

Ownership of a piece of property may best be described as a “bundle of rights.” These rights include the right to occupy, use, lease, sell, and develop the land. An easement involves the exchange of one or more of these rights from the landowner to someone who does not own the land. Easements have been used for years to provide governments, utilities, and extractive industries with certain property rights. An easement permits the holder certain rights regarding the land for specified purposes while the ownership of the land remains with the private property owner.  The property owner retains ownership of the land and is responsible for any and all taxes due.  The easement agreement should be filed with the county recorder where the property exists. To read more download the pdf of the new factsheet titled Considerations When Evaluating a Pipeline Easement Agreement.

Do You Have a Legal Workforce? The Importance of Form I-9 Compliance

Catharine Daniels, Attorney, OSUE Extension Agricultural & Resource Law Program

With the arrival of spring, many agricultural businesses may be looking to hire additional employees. Before putting those new employees to work, employers should take time to ensure a “legal” workforce.  One important step is following the Form I-9 Employment Eligibility Verification process.  And with the recent release of a new Form I-9, close attention to Form I-9 compliance is extremely important.

What is the purpose of Form I-9?  The form aims to verify the identity and employment of every person hired to perform labor or services in return for wages or for anything of value that is given in exchange for labor or services, including food and lodging.

Why worry about Form I-9?  Because correct completion of Form I-9 is both a legal mandate and a legal defense.  Federal law requires every employer to complete an I-9 form upon hiring an employee.    Filling out the form is not optional.  Even if the employer knows the new employee, knows of the employee or knows the employee’s family–the employer must do a Form I-9 for the employee.    Once properly completed, a Form I-9 is the employer’s defense against a potential claim of knowingly employing an unauthorized worker.

How does an employer complete Form I-9?  Form I-9 compliance requires completion of three sections, as follows:

  • Employers must have every newly hired employee complete Section 1 of the form no later than the first day of work for pay.  Section 1 requests personal employee information such as name, address, e-mail, phone number, date of birth and social security number and requires the employee to attest to his or her citizenship status.
  • No later than the third day of employment, the employer must complete and sign Section 2 of the form. Section 2 requires the employer to physically examine documentation presented by the employee showing identity and employment authorization.    There are three lists of acceptable documents; employees may present one document from List A or a combination of one document from List B and one document from List C.  Examples of documents include U.S. passports, driver’s licenses, social security cards and employment authorization from the Department of Homeland Security.
  • Section 3 applies to re-verification and rehires.  An employer must complete Section 3 only if the employee is not a U.S. citizen or lawful permanent resident and his or her employment authorization documentation has expired.  An employer may complete Section 3 for employees rehired within three years of the date that a Form I-9 was originally completed, or the employer  may choose to complete a new Form I-9 for the rehired employee.

What does an employer do with completed I-9 forms?  An employer must keep all completed  I-9 forms for all current employees and make the forms available to federal officials in the event of an inspection.  An employer must keep I-9 records for a certain period of time after employees stop working.  This period of time varies; the government provides a chart to help employers identify the appropriate period of time.

Are there penalties for non-compliance?  Yes.  An employee may be subject to civil penalties for failing to properly complete, retain or make the I-9 forms available for inspection.

When is the new Form I-9 effective?  On March 8, 2013, a new Form I-9 was released with revisions. The revised Form I-9 is now two pages long, includes expanded instructions, and has new fields for e-mail addresses, phone number, and foreign passport. Employers should be using this revised form now, but may continue to use the previous Form I-9 until May 7, 2013.

The importance of document inspection.   To avoid liability, the employer should properly inspect the employee’s documents.   The documents must reasonably appear to be genuine and relate to the person presenting them.  The employer’s duty is to verify the documentation; the job of fully “investigating” whether the employee is authorized to work rests with U.S. Immigration Customs Enforcement.  If an employee provides a document that does not appear to be genuine or relate to the employee and the employee cannot present other documentation, then the employer may terminate employment.

Avoiding discrimination liability.  Employers should make sure they do not engage in any discriminatory practices when it comes to the Form I-9.  At the pre-hire stage, an employer may not ask an applicant their citizenship, nationality, immigration status, type of work authorization, or green card status. After hiring the employee, an employer may not request a particular document for the employee to provide to complete the Form I-9; it is the employee’s decision as to what documents they will provide. An employer also may not request more documents than what are required by Form I-9.   Such actions by the employer might result in a discrimination claim.

For complete information about I-9 compliance, check out the “Handbook for Employers – Guidance for Completing Form I-9″ on the  U.S Citizenship and Immigration Services I-9 Central website.

2013 Ohio Enterprise Budgets

By: Barry Ward, OSU Extension, Leader, Production Business Management, Department of Agricultural, Environmental, and Development Economics

Budgeting helps guide you through your decision making process as you attempt to commit resources to the most profitable enterprises on the farm. Crops or Livestock? Corn, Soybeans, Wheat, Hay? We can begin to answer these questions with well thought out budgets that include all revenue and costs. Without some form of budgeting and some method to track your enterprises’ progress you’ll have difficulty determining your most profitable enterprise(s) and if you’ve met your goals for the farm.

Budgeting is often described as “penciling it out” before committing resources to a plan. Ohio State University Extension has had a long history of developing “Enterprise Budgets” that can be used as a starting point for producers in their budgeting process.

Newly updated Enterprise Budgets for 2013 have been completed and posted to the Farm Management Website of the Department of Agricultural, Environmental and Development Economics. Updated Enterprise Budgets can be viewed and downloaded from the following website: http://aede.osu.edu/programs/farmmanagement/budgets

Enterprise Budget projections updated for 2013 include: Corn-Conservation Tillage; Soybeans-No-Till (Roundup Ready); Wheat-Conservation Tillage, (Grain & Straw); Alfalfa Hay; Alfalfa Haylage; Grass Hay, Swine-Farrow to Wean; Swine- Wean to Finish.

Our enterprise budgets are economic budgets. This means that, in addition to cash expenses and depreciation, opportunity costs of land, labor, management and capital are included. By including these costs we are able to estimate an economic profit which is different from an accounting profit. By including opportunity costs of labor and management in an economic enterprise budget, the user can determine whether the enterprise is economically viable in the time-frame being considered.

Using current input costs for Ohio row crops we find that the break-even price for corn to be between $4.98 and $5.31 per bushel (assuming 158 or 190 bushel production potential).

Using current input costs for Ohio soybean we find that the break-even price to be between $11.73 and $12.47 per bushel (assuming  or 46 or 55 bushel production potential).

Our enterprise budgets are compiled on downloadable Excel Spreadsheets that contain macros for ease of use. Users can input their own production and price levels to calculate their own numbers. These Enterprise Budgets have color coded cells that allow users to plug in numbers to easily calculate bottoms lines for different scenarios. Detailed footnotes are included to help explain methodologies used to obtain the budget numbers. Budgets include a date in the upper right hand corner of the front page indicating when the last update occurred.

Farm Management Decision Tools to Assist With Lease Planning

by: Barry Ward, Leader, Production Business Management, Department of Agricultural Environmental and Development Economics, Ohio State University Extension, Leader, Production Business Management

There are a variety of tools available to assist you as a farm manager or landowner in the task of developing a flexible cash lease or crop share lease. These tools have been developed through Ohio State University Extension and the Department of Agricultural Environmental and Development Economics at the Ohio State University. These tools are downloadable Excel spreadsheets that can be used to evaluate changes to lease amounts depending on changing lease parameters. These tools are available online at: http://aede.osu.edu/programs-and-research/osu-farm-management/decision-tools

The following are descriptions of the each tools.

 

Flexible Cash Lease Calculator – Cash Lease with a Bonus Approach

This flexible cash lease tool is intended to help landowners and tenants agree on terms of their flexible cash lease. This Flexible Cash Lease Calculator can assist users in developing a flexible cash rent model.

The flexible cash rent approach used in this calculator allows users to compare actual prices, yields and gross income to base prices, yields and gross revenue. The difference between the base and actual gross revenues can be shared in some proportion between landowner and operator and added to the base cash rent.

The Microsoft Excel spreadsheet is designed to enable the user to input base and year end prices, yields and proportional split to formulate a flex rental amount at the end of the lease year.

 

Flexible Cash Lease Calculator – Net Return Approach

This flexible cash lease tool is intended to help landowners and tenants agree on terms of their flexible cash lease. This Flexible Cash Lease Calculator can assist users in developing a flexible cash rent model. Unlike other flexible cash lease calculators, this tool allows the user to incorporate flexible parameters for input costs as well as for price and yield.

The flexible cash rent approach used in this calculator allows users to calculate actual net income for rented land and compare it against a base net income. The difference between the base and actual net revenues can be shared in some proportion between landowner and operator and added to the base cash rent.

The Microsoft Excel spreadsheet is designed to enable the user to input base and year end prices, yields and costs to formulate a flex rental amount at the end of the lease year.

 

Flexible Cash Lease Calculator – Ratio Approach

This flexible cash lease tool is intended to help landowners and tenants agree on terms of their flexible cash lease. This Flexible Cash Lease Calculator can assist users in developing a flexible cash rent model. Unlike other flexible cash lease calculators, this tool allows the user to incorporate flexible parameters for input costs as well as for price and yield.

The flexible cash rent approach used in this calculator is to multiply the base rent by: 1) the ratio of the Year End Price to Base Price, 2) the ratio of the Year End Yield to Base Yield and, 3) the ratio of the Base Input Costs to Year End Input Costs.

The Microsoft Excel spreadsheet is designed to enable the user to input base and year end prices, yields and costs to formulate a flex rent at the end of the lease year. There are two tabs for this calculator. Page 1 contains the Flexible Cash Lease Inputs and page 2 contains the Flexible Cash Lease Output.

 

Crop Share Calculator

The Crop-Share Lease Calculator is a tool designed to allow the user to input costs and shares of each to fairly allocate revenue in a crop share lease arrangement. This tool shows the tenant and landowner returns above total costs given share percentages and costs. This decision aid contains three sections:

Shares

This section separates various receipt and cost sections out so that the user can input the share percentage of that particular item.  Simply input the percentage that the landowner is responsible for and the tenant percentage is automatically generated.

Costs

This section allows the user to input the costs and receipts for the particular crops.

Output

This section separates the sections into 4 broad categories (Receipts, Inputs, Machinery, and Direct Costs) and breaks them down to show the amount (based on the percentages inputted in section 1) that the landowner and the tenant are responsible for.  At the bottom of the sheet, it will show the return to total costs based on the numbers provided.