Ag Law Harvest

By: Jeffrey K. Lewis, Esq., Program Coordinator Income Tax Schools at The Ohio State University

With just over a week left until echoes of “Hang on Sloopy” and chants of “O-H” and “I-O” can be heard from Buckeye faithful across the nation, we thought we would provide you with some light reading to hold you over until that long awaited 3:30 kick off. In this edition of our Ag Law Harvest, we focus on three recent Ohio Supreme Court cases that could potentially impact business owners, Northern Ohio landowners, and Ohio taxpayers. 

Assault and Battery: Is it Covered Under an Insurance Policy?
A victim of a stabbing at an Ohio adult care facility is unable to collect judgment from the facility’s insurance company after a recent decision by the Ohio Supreme Court. The victim was living at the facility when another resident stabbed him. The perpetrator was later indicted on criminal charges but found not guilty by reason of insanity. 

The victim then filed a civil lawsuit against the perpetrator and the facility to recover for damages resulting from the stabbing injuries. The victim ultimately dropped his lawsuit against the perpetrator and entered into a settlement agreement with the facility. As part of the settlement agreement, the victim agreed not to pursue the judgment against the facility, and instead, sought to collect his judgment from the facility’s insurance company.   

At the time of the stabbing, the adult care facility had a commercial general liability policy. When the victim sought judgment from the facility’s insurance company, the insurance company refused to provide coverage. The insurance company explained that the insurance policy contained a provision that specifically excluded coverage for any bodily injury resulting from an assault or battery. The specific provision at issue stated: 

“1. This insurance does not apply to ‘bodily injury,’ * * * arising out of or resulting from: (a) any actual, threatened or alleged assault or battery; * * *.”

The victim argued that because the perpetrator was found to be not guilty by reason of insanity in the criminal trial, the exclusion provision was nullified because the perpetrator lacked the subjective intent to commit any assault or battery. 

The Ohio Supreme Court disagreed. The Court explained that the plain language of the exclusion provision of the insurance policy at issue is clear – there is no intent requirement included in the exclusion language. Therefore, the Court held that coverage did not exist for the willful assault on the victim. The Court sympathized with the victim but ultimately could not interpret the insurance policy language to include a subjective intent requirement where none existed. 

This case demonstrates the importance of reading and understanding your business insurance policy. Insurance policies are, at the core, contracts between two parties and the language contained within the policy will usually govern that contractual relationship. What you assume is covered under your policy may not necessarily be the case. Furthermore, not all insurance policies are the same. We have seen Ohio cases where an insurance policy does require the presence of some subjective intent in order for an assault and battery exclusion to apply. Speak with your insurance agent and/or attorney to make sure you understand when and where coverage exists, knowing this can be critical to protecting you, your farm, and/or your business. 

Ohio Supreme Court Approves Northern Ohio Wind Farm. 
Residents of Huron and Erie Counties along with Black Swamp Bird Conservatory (the “Plaintiffs”) recently lost their battle in court to prevent the construction of a new wind farm in Northern Ohio. The Plaintiffs argued that the Ohio Power Siting Board (the “Board”) failed to satisfy Ohio law before granting the new wind farm its certificate of environmental compatibility and public need. Specifically, the Plaintiffs assert that the wind farm could “disrupt the area’s water supply, create excessive noise and ‘shadow flicker’ for residents near the wind farm, and kill bald eagles and migrating birds.” 

The Ohio Supreme Court found otherwise. The Court concluded that the Plaintiffs failed to establish that the Board’s granting of the certificate was unlawful or unreasonable. As approved, the new wind farm will consist of up to 71 turbines and cover 32,000 acres of leased land. To read more about the Ohio Supreme Court’s decision visit: In re Application of Firelands Winds, L.L.C.

Ohio Supreme Court Sets New Precedent on Interpreting Ohio Tax Law.
In Ohio, most retail sales are subject to sales tax unless a certain exemption applies. Ohio law does have a sales tax exemption for equipment used directly in the production of oil and gas. A fracking business recently challenged a decision by Ohio’s Tax Commissioner and Board of Tax Appeals that levied the sales tax on certain equipment purchased by the business. The fracking equipment at issue included: a data van, blenders, sand kings, t-belts, hydration units, and chemical-additive units.

The Tax Commissioner concluded that the fracking equipment was not used directly in the extraction of oil and gas, only indirectly, and therefore, did not qualify for the tax exemption. The Ohio Supreme Court felt differently. 

The Court found that all the equipment, except the data van, is used in unison to expose the oil and gas. Because the equipment is used to expose the oil and gas – a necessary part of fracking – the Court had little difficulty concluding that the equipment is being used directly in the production of oil and gas. 

In addition to the equipment’s direct use in the production of oil and gas, the Court also recognized that the fracking equipment may also have a storage or delivery function/purpose. However, the Court reasoned that a piece of equipment’s function must be viewed through the “primary purpose” lens. For example, the Court held that although the blender equipment in this case performs a holding function, the primary use of the blender is to mix “the critical ingredients in the fracking recipe seconds before the mixture is inserted into the well.” Therefore, the Court found that the blender’s holding function did not disqualify it from Ohio’s sales tax exemption. 

Additionally, in this case, the Court also issued an opinion on how Ohio courts should interpret tax law moving forward. Normally, courts use the ever-important legal principal of stare decisis to help it decide on new cases. Stare decisis is the principal that courts and judges should honor the decisions, rulings, and opinions from prior cases when ruling on new cases. Here, the Court took its opportunity to acknowledge that in the past the Court interpreted tax exemptions against the taxpayer, favoring tax collection. But the Court made clear that from here on out, the Court “will apply the same rules of construction to tax statutes that [it applies] to all other statutes” without a slant toward one side or the other. The Court concluded that its task “is not to make tax policy but to provide a fair reading of what the legislature has enacted: one that is based on the plain language of the [law].” To read the Ohio Supreme Court’s decision visit: Stingray Pressure Pumping, L.L.C. v. Harris

The Ag Law Roundup: your legal questions answered

The summertime slowdown hasn’t affected the number of agricultural law questions we’ve received from across Ohio. Here’s a sampling of recent questions and answers:

Is a tree service business considered “agriculture” for purposes of Ohio rural zoning?

No, tree trimming and tree cutting activities are not listed in the definition of agriculture in Ohio’s rural zoning laws, although the definition does include the growing of timber and ornamental trees. The definition ties to the “agricultural exemption” and activities that are in the “agriculture” definition can be exempt from county and township zoning.  Here is the definition, from Ohio Revised Code sections 303.01 and 519.01:

“agriculture” includes farming; ranching; algaculture meaning the farming of algae; aquaculture; apiculture; horticulture; viticulture; animal husbandry, including, but not limited to, the care and raising of livestock, equine, and fur-bearing animals; poultry husbandry and the production of poultry and poultry products; 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; and 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.

What are the benefits of being enrolled in the “agricultural district program” in Ohio, and is there a penalty for withdrawing from the program?

There are three benefits to enrolling farmland in the agricultural district program:

1. The first is the nuisance protection it offers a landowner.  A landowner can use the defense the law provides if a neighbor who moves in after the farm was established files a lawsuit claiming the farm is a “nuisance” due to noise, odors, dust, etc.  Successfully raising the defense and showing that the farm meets the legal requirements for being agricultural district land would cause the lawsuit to be dismissed.  
2. The second benefit is that the law also exempts agricultural district land from assessments for water, sewer and electric line service extensions that would cross the land.  As long as the land remains in agricultural district program, the landowner would not be subject to the assessments.  But if the land is changed to another use or the landowner withdraws the land from the agricultural district program, assessments would be due.  The assessment exemption does not apply to a homestead on the farmland, however.
3. A third benefit of the agricultural district program law is that it requires an evaluation at the state level if agricultural district land is subject to an eminent domain action that would affect at least 10 acres or 10% of the land.  In that case, the Director of the Ohio Department of Agriculture must be notified of the eminent domain project and must assess the situation to determine the effect of the eminent domain on agricultural production and program policies.  Both the Director and the Governor may take actions if the eminent domain would create an unreasonably adverse effect.

As for the question about a penalty, the law does allow the county to assess a penalty when a landowner withdraws land from the agricultural district program during the agricultural district enrollment period, which is a five-year period.  If a landowner removes the land from the agricultural district, converts the land to a purpose other than agricultural production or an agricultural conservation program, or sells the land to another landowner who does not elect to continue in the agricultural district program, the landowner must pay a withdrawal penalty.  The amount of the penalty depends on whether the land is also enrolled in the Current Agricultural Use Value program.  See the different penalty calculations in Ohio Revised Code 929.02(D(1).

Read the agricultural district program law in Chapter 929 of the Ohio Revised Code and contact your county auditor to learn about how to enroll in the program.

My farmland is within the village limits and the village sent me a notice that I must cut a strip of tall grass on my land.  Do I have to comply with this?

Yes.  Ohio law allows a municipality such as a village to have vegetation, litter, and “noxious weeds” laws.  These laws can set a maximum limit for the height of grass, require removal of litter on the property, and require ridding the land of “noxious weeds.”  The purpose of the laws is to protect property values, protect public health by preventing pests and nuisances from accumulating, and keep noxious weeds from spreading to other properties.  The village is within its legal authority to enforce its grass, litter, and noxious weeds laws on a farm property that is within the village limits. Failing to comply with an order by the village can result in a fine or  financial responsibility for all expenses incurred by the village to remedy the problem.

Is it legal to pull water from a river or stream to irrigate land in Ohio?

Yes, as long as the withdrawal occurs on private land or with the consent of the public or private landowner.  Registration with the Ohio Department of Natural Resources is required, however, if the amount withdrawn exceeds 10,000 gallons per day and the State has the ability to scale the 10,000 gallon amount back if the withdrawal is within an established groundwater stress area.  Withdrawal registration information is available on the Division of Water Resources website. 

Note that according to Ohio’s “reasonable use” doctrine, if a water withdrawal causes “unreasonable” harm to other water users, a legal action by harmed users could stop or curtail the use or allocate liability for the harm to the person who withdrew the water.  To avoid such problems, a person withdrawing the water should ensure that the withdrawal will not cause “unreasonable” downstream effects.

An urban farmer wants to build a rooftop greenhouse to grow hemp and then wants to make and sell cannabis-infused prepared foods at a market on her property.  Who regulates this industry and where would she go for guidance on legal and regulatory issues for these products?

Regulation and oversight of food products that contain cannabis is a combination of federal and state authority.  Federal regulation is through the U.S. Food and Drug Administration and state regulation is via the Ohio Department of Agriculture’s Food Safety Division.  She should refer to these resources:

• U.S. – https://www.fda.gov/news-events/public-health-focus/fda-regulation-cannabis-and-cannabis-derived-products-including-cannabidiol-cbd#legaltosell
• Ohio – https://agri.ohio.gov/divisions/food-safety/resources/Hemp-Products

As for the growing of hemp, the Ohio Department of Agriculture (ODA) regulates indoor hemp production in Ohio.  There is a minimum acreage requirement for indoor production—she must have at least 1,000 square feet and 1,000 plants.  See these resources from ODA:

• https://agri.ohio.gov/divisions/hemp-program/cultivation. 
• https://agri.ohio.gov/divisions/hemp-program/faqs

She should also look into zoning regulations that could affect her farm market and the greenhouse structure she wants to build.  If she is within a municipality (unlike outside of a municipality in a township or county), there may be zoning regulations that apply to both of these land uses.  And food licensing regulation could come into play.  If she is selling other types of food items along with the cannabis foods, she’ll likely need a Retail Food Establishment (RFE) license from the County Health Department.  See our Law Bulletin for an explanation of when an RFE license is necessary.

Ohio may soon have new regulations for solar energy development

A long process to update Ohio’s regulations for solar energy facility development has nearly reached its end.  On July 20, the Ohio Power Siting Board (OPSB) adopted new rules that include revisions to rules that apply to solar facilities under its jurisdiction—those that have a nameplate capacity of 50 megawatts or more.  The rules will next go to the Ohio legislature’s Joint Committee on Agency Rule Review (JCARR) for a final review before they can become effective.

The OPSB began the rules review in 2020.  The process included stakeholder meetings, public workshops, a draft proposal of revisions, and a review of comments to the draft rules.  Many parties and interested individuals followed the process, and the agency received formal input from 20 parties and over 400 informal public comments.  The OPSB recognized that the rules review “inspired a robust discussion from numerous interested stakeholders.”

What are the proposed changes?

OPSB summarizes the rule changes it adopted as follows:

• Public information: Siting project applicants must host two public informational meetings for each standard certificate application. The first meeting will describe the scope of the project. The second meeting, held at least 90 days before an application filing, will focus on the specifics of the application. 
• Site grading: Applicants must provide a preliminary grading plan that describes maximum graded acreage expectations.
• Drainage and field tile: Applicants must describe and map field drainage systems and demonstrate how impacts to those systems will be avoided or mitigated, describe how damaged drainage systems including field tile mains and laterals will promptly be repaired to restore original drainage conditions and describe the data sources and methods used to obtain information for field drainage system mapping.
• Vegetation management: Applicants must prevent the establishment and spread of noxious weeds within the project, including setback areas, during construction, operation, and decommissioning. Applicants must provide annual proof of weed control for the first four years of operation with the goal of weed eradication significantly completed by year three of operation.
• Noise: Noise limits for renewable energy facilities cannot exceed the greater of 40 decibels (dBA) or the ambient daytime and nighttime average sound level by more than 5 dBA.
• Surface water protection: Solar energy facility applicants must develop and implement a stormwater pollution prevention plan, a spill prevention control and countermeasure plan, and a horizontal directional drilling contingency plan, to minimize and prevent potential discharges to surface waters.
• Fencing: Solar energy facility perimeter fencing must be small-wildlife permeable and aesthetically fitting for a rural location.
• Setbacks: Solar energy facility panel modules must be setback at least 50 feet from non‑participating parcel boundaries, at least 300 feet from non-participating residences, and at least 150 feet from the edge of the pavement of any road within or adjacent to the project area.
• Regulatory: Compliance monitoring and reporting requirements to ensure applicants meet the commitments and conditions contained in each OPSB certificate.

What happens next?

Parties have 30 days from the July 20 adoption date to file a request for a rehearing on OPSB’s decision to adopt the rules.  A rehearing request to OPSB must be based upon an argument that the rules are unreasonable or unlawful.  Absent a rehearing request, the OPSB will forward the rules package to JCARR, a committee consisting of five representatives and five senators from the Ohio legislature.  JCARR must hold a public hearing to hear comments on the rules between 31 and 45 days after receiving them, then must review the rules to ensure they don’t exceed OPSB’s authority, conflict with existing rules or legislative intent, and include analyses of fiscal and business impacts. The committee will next either approve the rules or recommend invalidation of some or all of the rules by the Ohio legislature, and both the House and Senate would have to pass resolutions to follow JCARR’s invalidation recommendations.  If JCARR approves the rules, they’ll go into effect right away.

Follow the JCARR rules review process at https://www.jcarr.state.oh.us/.

Follow this link to read the OPSB Order adopting the rules, which contains the revised rules beginning on page 14.

The entire history of the rules revision is available in Case Record 21-0902-GE-BRO.

Ag Law Harvest

By: Jeffrey K. Lewis, Esq., Program Coordinator, OSU Income Tax Schools & ANR Extension

It’s getting hot! And we are here to bring you even more heat. This month’s Ag Law Harvest takes you across the country and even across our northern border as we highlight some interesting court cases, a petition to the USDA, and some legislation coming across the desks of Governors from Maine to Oregon.

Ohio Court Determines That Dairy Farm Did Not Intentionally Harm Employee. In 2019, a dairy farm employee sustained serious injuries after getting caught in a PTO shaft while operating a sand spreader. After his injury, the employee filed a lawsuit against his employer for failing to repair or replace the missing safety guards on the PTO shaft and sand spreader. In his lawsuit, the employee alleged that the dairy farm’s failure to repair or replace the missing safety guards amounted to a “deliberate removal” of the equipment’s safety features making the dairy farm liable for an intentional tort. In other words, the employee was accusing his employer of intentionally causing him harm. Normally, workplace injuries are adjudicated under Ohio’s workers’ compensation laws, unless an employee can prove that an employer acted intentionally to cause the employee harm. 

For an employer to be held liable for an intentional tort under Ohio law, an employee must prove that the employer acted with the specific intent to injure an employee. An employee can prove an employer’s intent in one of two ways: (1) with direct evidence of the employer’s intent; or (2) by proving that the employer “deliberately removed” equipment safety guards and/or deliberately misrepresented a toxic or hazardous substance. Because there was no direct evidence to prove the dairy farm’s intent, the employee could only try his case under the theory that the dairy farm deliberately removed the safety guards, intentionally causing him harm. 

The case went to trial and the jury found the dairy farm liable and ordered it to pay over $1.9 million in damages. The dairy farm appealed to the Twelfth District Court of Appeals arguing that its failure to repair or replace does not amount to a “deliberate removal” of the safety guards from the PTO shaft and sand spreader. The appellate court agreed. 

The Twelfth District decided to apply a narrow interpretation of the term “deliberate removal.” The court held that a “deliberate removal” is defined as the “deliberate decision to lift, push aside, take off, or otherwise eliminate.” The evidence presented at trial showed that the shaft guard may have simply broken off because of ordinary wear and tear. Additionally, the evidence could not establish who removed the connector guard or if the connector guard did not also break off due to ordinary wear and tear. Thus, the Twelfth District found that the evidence presented at trial did not support a finding that the dairy farm made “a careful and thorough decision to get rid of or eliminate” the safety guards. Furthermore, the Twelfth District reasoned that an employer’s “failure to repair or replace a safety guard is akin to permitting a hazardous condition to exist” and that the “mere knowledge of a hazardous condition is insufficient to show intent to injure. . .” The Twelfth District vacated and reversed the $1.9 million judgment and entered summary judgment on the dairy farm’s behalf.  

USDA Receives Petition Over “Climate-friendly” Claims. 
The Environmental Working Group (EWG) has petitioned the U.S. Department of Agriculture (“USDA”), asking the USDA to: (1) prohibit “climate-friendly” claims or similar claims on beef products; (2) require third-party verification for “climate-friendly” and similar claims; and (3) require a numerical on-pack carbon disclosure when such claims are made. The core legal issue is whether such “climate-friendly” labels and numerical carbon disclosures are protected and/or prohibited by the legal doctrine of commercial speech, which is protected under the First Amendment of the U.S. Constitution. EWG argues that the USDA has the authority to regulate such speech because commercial speech is only protected if it is not misleading. Additionally, EWG claims that requiring numerical carbon disclosures advances a substantial governmental interest by protecting consumers from fraud and deception. Although EWG has the legal right to petition the USDA, the USDA does not have to grant EWG’s petition, it must only consider the petition and respond within a reasonable time. 

Maine Governor Vetoes Ag Wage Bill.
Earlier this month Maine Governor, Janet Mills, vetoed Legislative Document 398 (“LD 398”) which required agricultural employers to pay their employees a minimum wage of $13.80 and overtime pay. Governor Mills stated that she supports the concept of LD 398 but was concerned about some of the bill’s language. The Maine legislature had the opportunity to override the Governor’s veto but failed to do so. After the legislature sustained her veto, Governor Mills signed an executive order establishing a formal stakeholder group to develop legislation that will establish a minimum wage for agricultural workers while also addressing the impacts the future legislation will have on Maine’s agriculture industry. 

A Big Thumbs Up! 
A Canadian judge recently found that a “thumbs-up” emoji is just as valid as a signature to a contract. In a recent case, a grain buyer, South West Terminal Ltd. (“SWT”), sent through text message, a deferred grain contract to a farming corporation owned and operated by Chris Achter (“Achter”). The contract stated that Achter was to sell 86 metric tonnes of flax to SWT at a price of $17 per bushel. SWT signed the contract, took a picture of the contract, and sent the picture to Achter along with a text message: “Please confirm flax contract”. Achter texted back a “thumbs-up” emoji. When the delivery date came and passed, Achter failed to deliver the flax to SWT which prompted SWT to file a lawsuit for breach of contract. SWT argued that Achter’s “thumbs-up” meant acceptance of the contract. Achter, on the other hand, claimed that the use of the emoji only conveyed his receipt of the contract. 

The Canadian court ultimately ruled in favor of SWT. The court relied on evidence that Achter and SWT had a pattern of entering into binding contracts through text message. In all previous occurrences, SWT would text the terms of the contract to Achter and Achter would usually respond with a “looks good”, “ok”, or “yup”. This time, Achter only responded with a “thumbs-up” emoji and the court concluded that an objective person would take that emoji to mean acceptance of the contract terms. Achter was ordered to pay over C$82,000 ($61,442) for the unfulfilled flax delivery. As the old saying goes: “a picture is worth a thousand words or tens of thousands of dollars.”  

Oregon Governor Signs Agriculture Worker Suicide Prevention Bill into Law. Earlier this month, Oregon Governor Tina Kotek signed a bill that creates a new suicide prevention hotline for agricultural producers and workers into law. Senate Bill 955 (“SB 955”) provides $300,000 to establish an endowment to fund an AgriStress Helpline in Oregon. Proponents of the bill believe the AgriStress Helpline will be able to specifically address the needs of agricultural producers and workers which “[s]tatistically . . . have one of the highest suicide rates of any occupation.” Oregon becomes the 7^th state to establish an AgriStress Hotline joining Connecticut, Missouri, Pennsylvania, Texas, Virginia, and Wyoming. 

Want to donate your garden surplus? Ohio law provides liability protection

It’s the time of year when many Ohio vegetable gardeners are wondering, “why in the world did I plant so many zucchini?”  And it’s also when we start hearing the question, “is there any liability risk in giving away my garden produce?”  The good news is that Ohio has a food donation immunity law.  The law encourages food donations by granting liability protection to those who give perishable foods like garden produce to agencies that serve individuals in need.  A new amendment to the law recently passed in Senate Bill 16 broadens the types of donations that qualify for liability protection.  If you’re up to your ears in garden produce, you may want to know about the food donation immunity law.

Here’s how the law works.

1. The grant of immunity

The food donation immunity law is in Ohio Revised Code 2305.37.  It states in Section B that a person who, “in good faith,” donates “perishable food” to an “agency” is not liable for harm that may arise if the food, when distributed to an “individual in need,” is not “fit for human consumption.” 

2. The donation must be made “in good faith” that the food is “fit for human consumption” when donated

There is not a definition for the term “in good faith,” but it’s a term commonly used in legal situations.  It means that a person acted with an “honest intent” and not with an intent to deceive or conceal something. The food donation immunity law provides two conditions to help ensure a person is donating in good faith.  First, the immunity only applies if a person determines, prior to making a donation, that the food is “fit for human consumption” at the time it is donated to an agency.  The term “fit for human consumption,” though not defined by this law, means that it is edible and safe.  But note there is no responsibility on the donor to ensure the food will be edible and safe after it is donated, when it is actually consumed or distributed.  Second, when determining whether food is fit for consumption, a donor cannot act with gross negligence or willful or wanton misconduct.  These two conditions mean that if a donor doesn’t inspect the food at all before delivery or knows something happened to the food that could make it unsafe for consumption but donates it anyway, the law will not protect the donor from liability if the food causes harm. 

3. The law applies to “perishable food”

The law’s definition of “perishable food” is broad.  It refers to any food that may spoil or otherwise become unfit for human consumption due to its nature, age, or physical condition.  The definition includes fresh fruits and vegetables, fresh and processed meats, poultry, fish, seafood, dairy products, bakery products, eggs, refrigerated and frozen foods, and packaged foods.  It also includes food prepared but not served by a food service operation such as a restaurant, caterer, or hotel, and gleaned foods, discussed below.

4. Donations must be to “agencies” that serve “individuals in need”

Donations to friends and family don’t qualify for the liability protection—the law only applies to a donation to an “agency” that serves “individuals in need.”  Several definitions and conditions are important.

• An “agency” is an organization that distributes perishable food to “individuals in need,” either directly or indirectly. The term includes any nonhospital, charitable nonprofit corporation organized under Ohio nonprofit laws, or nonprofit charitable association, group, institution, organization, or society.  An “individual in need” is a person an agency determines to be eligible for food distribution due to poverty, illness, disability, infancy, or similar circumstances.
• A qualifying agency is one that does not charge a fee for the food.  However, Senate Bill 16 recently amended the law to allow donations to an agency that charges an amount no more than the cost of handling the food.  That change means even if individuals pay a food handling cost to receive the donated food, the donor of the food will receive immunity.
• Another section of the law, 2305.37(D), also grants immunity to an agency that distributes donated food as long as the agency determines the food is fit for human consumption when the food distribution occurs.

Ohio law also provides liability protection for “gleaning”

Growers can also be immune from liability when allowing someone else to pick or salvage the garden produce and donate it to an agency.  This is referred to as “food gleaning” and Ohio law also provides liability protection to those who allow food gleaning.  First, the gleaned food is considered “perishable food” and is covered by the food donation immunity law described above.  Second, the food gleaning immunity law in Ohio Revised Code 2305.35 grants a landowner or operator immunity for physical injuries sustained by a gleaner during the gleaning process. The landowner or operator is not liable for injuries to a gleaner resulting from any risks or conditions of the property or any normal agricultural operations on the property.

Ready to donate?

Gardeners ready to donate excess garden produce first need to find an agency that serves individuals in need.  Find a local food bank, food pantry, soup kitchen, meals on wheels, or similar agency, and make sure the agency doesn’t charge for the food or charges no more than the cost of handling the food.  These resources can help locate an agency: 

• Ample Harvest – https://ampleharvest.org/find-pantry/
• Ohio Victory Gardens –  https://u.osu.edu/ohiovictorygardens/donating-your-victory/
• Ohio Soup Kitchens, Food Banks, Food Pantries – https://www.homelessshelterdirectory.org/foodbanks/state/ohio

Before delivering garden produce to tan agency, be sure to inspect the produce and ensure it is fit for consumption—clean, not spoiled, and edible.  Don’t have time to pick and deliver?  Find a food gleaner who may be willing to glean your garden and donate the food to an agency.  Here’s a resource that lists Ohio food gleaners:  https://nationalgleaningproject.org/gleaning-map/states/ohio/?fwp_state=oh.

Ohio Supreme Court decision explains eminent domain procedures

When a landowner legally challenges an agency’s use of eminent domain to appropriate property, Ohio law requires a trial court to hold a hearing to determine the agency’s right to make the appropriation, according to a recent decision by the Ohio Supreme Court.  The Court held that an appeal to a higher court is not permissible until the trial court holds such a hearing and rules on the issues raised in the hearing.  For landowner Diane Less, the ruling means the trial court–the Mahoning County Court of Common Pleas–must hold a hearing to determine whether Mill Creek MetroParks had the right to make the appropriation of her land and whether that appropriation is necessary.

The case is one of several lawsuits and long-running controversies over Mill Creek MetroPark’s use of eminent domain to appropriate land for a bike path.  The Mahoning County disputes are one reason behind a current legislative proposal to revise Ohio’s eminent domain laws, which includes a prohibition against the use of eminent domain for recreational trails. The legislation is at a standstill, however, with many opponents lining up against the recreational trails and other provisions of the bill.

Basis for the decision

The current Mill Creek MetroParks v. Less case made its way to the Ohio Supreme Court after the Seventh District Court of Appeals reversed the Mahoning County court’s summary judgment decision that MetroParks was authorized to use eminent domain to take Less’ land.  MetroParks appealed that decision to the Ohio Supreme Court.  But rather than addressing the issue of authority to take the land, the high court focused on the procedures outlined in Chapter 163 of the Ohio Revised Code.  The statutes “provide a uniform eminent domain procedure for all appropriations sought by public and private agencies,” including procedures for when a property owner contests an appropriation.  The Court reviewed the statutory requirements in ORC 163.09, which require a trial court to hold a hearing when:

1. A property owner files an answer to a petition for eminent domain that specifically denies the right to make the appropriation or the necessity for the appropriation,
2. The answer alleges sufficient facts in support of the denial, and
3. The appropriation is not sought in a time of war or other public exigency or not for the purpose of making or repairing roads.

When MetroParks filed the eminent domain action against Less, she did file an answer that denied the Park District’s right to make the appropriation and the necessity for the appropriation.   Less also filed a motion for summary judgment, asking the court to rule in her favor and dismiss the case because there were no genuine issues of material fact in the case.  The trial court denied her motion, however, and Less filed an appeal of that denial to the Seventh District Court of Appeals.  The Supreme Court points out that the appeal should not have occurred, however, because the statutory procedures required the trial court to hold a hearing after it denied the summary judgment motion by Less.  Nevertheless, the Seventh District ruled on the appeal, reaching a decision that agreed with Less’ argument that the Park District did not have authority to take her land.

The Supreme Court accepted the case for review, but its purpose was not to rule on the issue of whether there was authority for the use of eminent domain.  Instead, the Court held that it had no jurisdiction to hear MetroPark’s appeal of the Seventh District’s decision, and that the Seventh District Appeals Court did not have jurisdiction to review the decision of the trial court.  Because the trial court had failed to follow the statutory procedures for a hearing and decision on the authority and necessity of the appropriation, there was no “final appealable order” that either party could appeal to a higher court. 

What happens next?

The Supreme Court vacated the decision of the Seventh District Court of Appeals and sent the case back down to the Mahoning County Court of Common Pleas.   The county court must now hold a hearing to review the landowner’s arguments on the authority and necessity for the park’s appropriation.  The court’s decision after that hearing will be an order that either party may choose to appeal to the Seventh District.  The best answer to the question of what happens next, most likely, is that case will continue to roll on for quite some time.

Read the Supreme Court’s Decision in Mill Creek MetroParks v. Less.

Corrected: Budget bill includes many non-budget changes for ag

[This is a corrected version of our earlier post, which had the Urban Farmer Youth Initiative Pilot Program in the wrong place in the blog.  That Pilot Program was approved in the budget bill and was not vetoed by the Governor–apologies!]

While Ohio’s “budget bill” is important for  funding our agencies and programs, it always contain many provisions that aren’t at all related to the state’s budget.  The budget bill provides an opportunity for legislators to throw in interests of all sorts, which tends to add challenges to reaching consensus.  Though many worried about having the current budget approved in time, Ohio lawmakers did pass the two-year budget bill,  H.B. 33, just ahead of its deadline on June 30. 

We’ve been digging through the bill’s 6,000+ pages of budget and non-budget provisions and the Governor’s 44-item veto.  Some of the provisions are proposals we’ve seen in other legislation that made their way into the budget bill.  Not included in the final package were Senate-approved changes to the Current Agricultural Use Valuation law that would have adjusted reappraisals in 2023, 2024, and 2025.  Here’s a summary of items we found of relevance to Ohio agriculture, not including the agency funding allocations.  We also summarize three vetoes by the Governor that pulled items from the budget bill.

Township zoning referenda – ORC 519.12 and 519.25

There is now a higher requirement for the number of signatures needed on a petition to subject a township zoning amendment to referendum by placing it on the ballot for a public vote.  The bill increased the number of signatures from 8% to 15% of the total vote cast in the township for all candidates for governor in the most recent general election for governor.

Legume inoculators – ORC 907.27 and 907.32

The bill eliminated Ohio’s annual Legume Inoculator’s License requirement for businesses and individuals that apply inoculants to seed. All other requirements for legume inoculants remain unchanged.

Agricultural commodity handlers–Grain Indemnity Fund – ORC 926.18

Ohio’s agricultural commodity handlers law provides reimbursement to a grain depositor if there is a bankruptcy or failure of the grain elevator.  The bill revises several parts of the law that provide a depositor with 100% coverage of a grain deposit when there’s a failure:

• If a commodity handler’s license is suspended and the handler failed to pay for the commodities by the date suspension occurred, the new law increases the number of days by which the commodities had to be priced prior to the suspension– from 30 to 45 days.
• If a commodity handler’s license is suspended and there is a deferred payment agreement between the depositor and the handler, the new law:

1. Requires that the deferred payment agreement must be signed by both parties.
2. Increases the number of days by which the commodities had to be priced prior to the suspension — from 90 to 365 days; and
3. Increases the number of days by which payment for the commodity must be made pursuant to the deferred payment agreement  — from 90 days to 365 days following the date of delivery.

• Requiring 100% coverage when commodities were delivered and marketed under a delayed price agreement up to two years prior to a handler’s license suspension. The delivery date marked on the receipt tickets determine the two-year period. The bill also states that the Grain Indemnity Fund has no liability if the delayed price agreement was entered into more than two years prior to the commodity handler’s license suspension.

Two circumstances for 100% of loss coverage from the Grain Indemnity Fund remain unchanged by the bill:  when the commodities were stored under a bailment agreement and when payment was tendered but subsequently denied.  For all other losses, the new law will reduce the fund payment to 75% of the loss.  Current law covers 100% of the first $10,000 of the loss and 80% of the remaining dollar value of that loss.

Office of the Migrant Agricultural Ombudsperson – ORC 3733

Current law establishes an Office of the Migrant Agricultural Ombudsperson under the authority of the Ohio Department of Jobs and Family Services (ODJFS), but the new law eliminates the Ombudsperson.  Instead, a currently existing State Monitor Advocate in ODJFS will be responsible for migrant issues and needs, such as collecting and reviewing data on living and working conditions, receiving complaints and alleged violations, conducting on-site reviews, monitoring the provisions of employment services, and connecting job seekers to employers through the Agricultural Recruitment System.

Commercial driver’s license waiver for farm-related service industries – ORC 4506.24

The bill increases the validity period for the CDL waiver for farm-related service industries.  Current law limits the total number of days a person may operate under the farm-related service industries waiver to 180, and the bill extends that period to 210 days per calendar year. The bill also allows online renewal of CDL licenses, revises several requirements for third-party CDL skills test examiners, and establishes several prohibitions and penalties for fraudulent acts related to CDL testing.

Income tax – ORC 5747.02

The law includes changes to Ohio’s income tax tables.  For the 2023 taxable year, the bill combines the two lowest tax brackets into one and reduces the marginal tax rates.  For tax year 2024, the bill further combines tax brackets and reduces the highest tax rate.  The Legislative Service Commission provides this chart that summarizes the changes:

Drainage assessment fund – ORC 6133.15

A designated fund for holding funding from the legislature to cover the state’s share of any assessments for drainage improvement projects will be abolished.  The change removes only the fund and does not remove the duty of the state to pay its share of any drainage improvement assessments.

Urban Farmer Youth Initiative Pilot Program

A new Urban Farmer Youth Initiative Pilot Program will provide relevant programming and support on farming and agriculture to youth living in urban areas. The bill directs the Chancellor of Higher Education to collaborate with Ohio State University Extension and Central State University Extension to offer programming in two to four Ohio counties and to partner with local entities.  Funds may also be used to expand programming to urban youth by existing agricultural organizations.

Vetoes by Governor DeWine

The Governor vetoed the following three ag-related items and offered explanations of his reasoning for the vetoes.

Save our Farmland and Protect our National Security Act

The Governor removed a provision that required the Secretary of State to compile a registry of individuals, business, organizations, and governments that constitute a threat to the agricultural production or military defense of Ohio or the U.S. and prohibited anyone on the registry from acquiring agricultural land or acquiring real property located within 25 miles of a military base or land under the jurisdiction of the armed forces. The Act also required property acquired in violation of the bill to escheat to the state, to be sold at public auction.  The Governor stated that while “restricting ownership of Ohio farmland protects Ohio’s rich agricultural tradition from adverse interests,” the bill could create unintended economic development consequences by including other non-agricultural property in the foreign ownership restriction.

Auctioneer laws

Governor DeWine vetoed several revisions to Ohio auctioneer law, stating that the revisions removed consumer protections recently enacted in H.B. 321, which went into effect in 2022.  The primary purpose of the revisions was to further exempt internet auctions, including auctions that involve sales of real or personal property through an auction mediation company platform. 

Commercial Activity Tax exclusions

The budget bill would have increased the $150,000 threshold for filers subject to the Commercial Activity Tax (CAT) to $3 million in 2024 and $6 million in 2025.  The Governor pointed out that the language in the bill was unclear, stating that “a technical veto is needed to clarify that the stated excluded amounts represent yearly tax periods,” and also noted that the veto would close an unintended potential loophole, open to exploitation through tax planning.

Visit this page on the Ohio General Assembly’s website for more information on the budget bill, H.B. 33.

Ohio EPA finalizes TMDL for Lake Erie’s Western Basin

It was a long time coming, but the Ohio EPA has presented a final Total Maximum Daily Load (TMDL) report for the Western Basin of Lake Erie to the U.S. EPA.  The agency submitted the “Maumee Watershed Nutrient TMDL ” report on June 30, 2023.  This was the exact deadline agreed to in the Consent Decree that settled litigation against the U.S. EPA and Ohio EPA over the lack of a TMDL for Lake Erie’s Western Basin. 

What is a TMDL?

A TMDL provides a framework for future decisions that affect water quality in waters designated as “impaired waters” that fail to meet water quality standards.  The Ohio EPA declared Western Lake Erie waters as “impaired” in 2018, and the TMDL is the plan for addressing shoreline and open water impairments in the basin.  According to the Ohio EPA, the TMDL report “identifies the links between the waterbody use impairment, sources of impairment, and the pollutant load reductions needed to meet water quality standards.”

How will it affect Ohio agriculture?

A major source of the impairment in the Lake Erie Western Basin is cyanobacterial harmful algal blooms caused by high phosphorus loads.  The report identifies many sources of phosphorus that contribute to the impairment, with the largest component being “nonpoint” sources that include row crop commercial fertilizers and manures.  “Point” sources of phosphorous sources include water treatment facilities; stormwater discharges; and home sewage treatment systems.  The TMDL calls for phosphorus load reductions in the Maumee watershed to remedy the lake’s impairment.  Agriculture would be affected by increased emphasis on management practices for agricultural fertilizers, manures, soils, and drainage. 

How does the TMDL address phosphorus reductions?

The TMDL embraces an “adaptive management” approach that involves developing strategies, establishing milestones, implementing strategies, monitoring environmental responses, evaluating progress, and adjusting strategies.  For row crops, the report focuses on management practices such as soil testing and developing a nutrient management plan.  It proposes other agricultural phosphorous reductions from soil erosion management, increasing cropping diversity through rotations and cover crops, reductions of phosphorus applications, edge-of-field management, two-stage ditch designs, and controlled drainage. The report points out that many of the proposed actions have already been underway on farms in the watershed for over a decade, and monitoring, evaluations, and adjustment strategies will continue the progress made to-date. Figure 50 in the report, below, highlights phosphorous reduction strategies.

What happens next?

The U.S. EPA now must review the TMDL and decide whether to approve or disapprove the report.  It has up to 90 days to do so, according to the Consent Decree.  If the U.S. EPA does not approve the TMDL report, it must then prepare a TMDL for the Western Basin. 

How to learn more

Read the Maumee Watershed Nutrient TMDL on the Ohio EPA website, which also includes a fact sheet, appendices, and a summary of responses to public comments on the draft TMDL.

What are the legal and farm management needs for your farm?

We’d like to hear from farmers!  If you’re a farmer, please consider completing our “Farm Legal Needs Survey.”

What do we want to know? Our survey asks you to tell us a little bit about your farming operation and:

• What legal issues you’ve encountered in your operation
• Your most challenging legal issues
• Farm management information needs
• How and where you prefer to receive legal and farm management information

Why are we asking these questions?  While the Farm Office team is engaged in farm management and agricultural law everyday, we want to make sure we’re not missing anything!   Hearing from farmers across Ohio will help us identify emerging issues, additional resources needed, and how to ensure our information is getting out to the farm community. 

How long will it take?  Only 5 or 10 minutes.

Is participation anonymous?  Yes.  We don’t ask you to identify yourself or your operation.

Where is the survey?  Access the survey through this link or the QR code below.

Questions?  Please contact Peggy Hall at aglaw@osu.edu with any questions about the survey. 

Thank you for helping us help you with your legal and farm management needs!

What’s happening for ag at the Ohio Statehouse?

Despite the arrival of summer and continuing disagreements over the state budget, Ohio legislators have been working on several pieces of legislation relevant to Ohio agriculture.  All of the proposals remain in committee but may see further action after the budget bill process ends. Here’s a summary of the ag related proposals currently under consideration at the Statehouse.

Senate Bill 111 – Urban Agriculture

Senator Paula Hicks-Hudson (D-Toledo) targets barriers for farmers in urban settings in SB 111, which has had three hearings before the Senate Agriculture and Natural Resources Committee. OSU Extension, the Ohio Municipal League, and several farmers have testified in support of the  proposal, which contains three components:

• Establishes an Urban Farmer Youth Initiative Pilot Program to provide youth between the ages of six and eighteen living in urban areas with programming and support for farming and agriculture.  The bill would appropriate $250,000 over 2024 and 2025 for the pilot, to be administered by OSU Extension and Central State Extension.
• Exempts temporary greenhouses, such as hoop houses, from the Ohio Building Code, consistent with Ohio law’s treatment of other agricultural buildings and structures. 
• Codifies the Department of Taxation’s current treatment of separate smaller parcels of agricultural land under the same farming operation, which allows the acreages to be combined to meet the 10 acre eligibility requirement for Current Agricultural Use Valuation.

House Bill 64 – Eminent Domain

A proposal to make Ohio’s eminent domain laws more favorable to landowners remains on hold in the House Civil Justice Committee.  HB 64 is receiving more opposition than support, with dozens of parties testifying against it in its fourth hearing on May 23.  Read more about the proposal in our previous blog post.

House Bill 162 – Agriculture Appreciation Act

Rep. Roy Klopfenstein (R-Haviland) and Rep. Darrell Kick (R-Loudonville) introduced HB 162 on May 1 and it received quick and unanimous approval from the House Agriculture Committee on May 16.  The bill has not yet been introduced in the Senate.  The proposal would make several designations under Ohio law already recognized by federal law:

• March 21 as “Agriculture Day.”
• October 12 as “Farmer’s Day.”
• The week beginning on the Saturday before the last Saturday of February as “FFA Week.”
• The week ending with the second Saturday of March as “4-H Week.”

House Bill 166 – Temporary Agricultural Workers

A bill addressing municipal income taxes for H2-A agricultural workers has met opposition in the House Ways and Means Committee.  HB 166, sponsored by Rep. Dick Stein (R-Norwalk) would subject foreign agricultural workers’ income to municipal income taxes.  The current municipal tax base in Ohio is based on federal tax laws that exclude foreign agricultural worker pay from Social Security and Medicare taxes since the workers cannot use those programs, and HB 166 would remove that exclusion and add H2-A income to the municipal tax base.  The bill would also require employers to withhold the taxes for the municipality of the workers’ residences.  While municipal interests support the bill, Ohio Farm Bureau and agricultural interests testified against it in its third hearing on June 13.  Opponents argue that H2-A workers are not residents because they are “temporary,” that the proposal would have many potential adverse effects on how Ohio handles the H2-A program, and would hamper the ability of agricultural employers to use the H2-A program to hire employees.

House Bill 193 – Biosolid and biodigestion facilities  

Biosolid lagoons and biodigestion facilities would have new legal requirements and be subject to local regulation under a proposal sponsored by Rep. Kevin Miller (R-Newark) and Rep. Brian Lampton (R-Beavercreek).  HB 193 would grant county and township zoning authority over the lagoons and facilities, require a public meeting and county approval prior to seeking a facility permit from the Ohio EPA, require the Ohio EPA to develop rules requiring covers on new biosolid lagoons, and modify feedstock requirements for biodigestion facilities to qualify for Current Agricultural Use Valuation property tax assessment.  HB 193 had its first hearing before the House Agriculture Committee on June 13.

House Bill 197 – Community Solar Development   

A “community solar” proposal that did not make it through the last legislative session is back in a revised form.  HB 197 proposes to define and encourage the development of “community solar facilities,” smaller scale solar facilities that are directly connected to an electric distribution utility’s distribution system and that create electricity only for at least three “subscribers.”  The bill would establish incentives for placing such facilities on distressed sites and Appalachian region sites through a “Community Solar Pilot Program” and a “Solar Development Program.” Rep. James Hoops (R-Napoleon) and Sharon Ray (R-Wadsworth) introduced the bill on June 6, and it received its first hearing before the House Public Utilities Committee on June 21. “The goal of this legislation is to create a small-scale solar program that seeks to be a part of the solution to Ohio’s energy generation and aging infrastructure need,” stated sponsor Hoops.

House Bill 212 – Foreign ownership of property

 Ohio joins a movement of states attempting to limit foreign ownership of property with the introduction of HB 212, the Ohio Property Protection Act.  Sponsored by Representatives Angela King (R-Celina) and Roy Klopfenstein (R-Haviland), the proposal would prohibit foreign adversaries and certain businesses from owning real property in Ohio. The bill was introduced in the House on June 13 and has not yet been referred to a committee for review.