May 22, 2012

Thank you for the invitation to testify at today’s hearing. My name is Judith McGeary and I am the Executive Director of the Farm and Ranch Freedom Alliance (FARFA). I am also a farmer and an attorney.

FARFA is a national organization that supports independent family farmers and protects a healthy and productive food supply for American consumers. FARFA promotes common sense policies for local, diversified agricultural systems. Our members include both farmers and consumers, drawn together by a common concern about where our food comes from.

There’s a very simple fact that is often overlooked: if you want to improve access to healthy foods, you have to address the barriers to producing healthy foods. Barriers to production discourage people from becoming farmers or expanding their operation. For the farmers willing and able to produce despite the barriers, the costs, in both out of pocket expenses and time, must be passed on to consumers. Some of the same barriers, such as zoning restrictions, hamper those who are just trying to raise food for themselves and their families.

Indeed, the line between personal use and food for sale is a thin one in local food systems. People with large backyard gardens often have excess produce that they wish to sell, and backyard operations can be an entry to farming as a business. According to the last census, there are over 175,000 farms in Texas with sales of less than $10,000 per year. If the goal is to improve access to healthy foods, then encouraging these start ups and very small farms to grow is a vital step.

I. Health regulations

Farmers repeatedly reference health regulations as the greatest barrier to their ability to produce and sell locally raised foods. As small businesses that are strictly liable for any injury caused by their products, farmers and local food producers are extremely aware of the need for food safety. Those who market directly to consumers typically know their customers personally, adding yet another dimension to the sense of responsibility for providing a safe product. Farmers do not oppose reasonable regulations that truly improve food safety. Unfortunately, many of the existing regulations do not serve that purpose but rather merely codify into law the practices of large scale producers.

The most commonly voiced complaint is that it is all but impossible to get clear answers from the health departments as to what is even required. There is often a disconnect between State, county and municipal departments and their interpretations of the various laws, ordinances, and regulations. Whether one is speaking to the Department of State Health Services or almost any local health department, maneuvering the maze of regulations and contradictory answers poses difficulties for a trained lawyer, much less lay people who are just trying to raise healthy food to sell in their communities. Approximately 69% of Texas farmers have another occupation, requiring them to do the actual work of farming and deal with the regulations while juggling at least one other job.

In addition, the fees involved can be very burdensome for small farmers. While almost all of the local governments base their requirements on the state’s regulations, each local jurisdiction has its own permit requirements and fees. A farmer who sells at several local farmers markets might be required to have 3 or 4 different permits from different government authorities. Some counties require separate permits for each location even within the same county or for different products, multiplying costs further. Permit fees can range from $35 to over $200 for each permit, often forcing farmers to abandon certain markets or products simply due to the hassle and cost of the permits.

Looking at the substance of the regulations, many are simply not necessary to meet the goal of safe food. Below are some of the specific regulations that have hampered many of our members in producing and selling healthy foods:

1. Sampling regulations: Providing samples is important both for increasing sales and for encouraging consumers to try foods with an unfamiliar appearance. The most effective way to convince someone to add fruits and vegetables to their diet is to be able to slice off a piece and hand it to the person to taste. But the regulations for sampling are premised on large-scale brick-and-mortar operations and are inappropriate for farm stands and farmers markets. As an example, while clean utensils are important, three-basin sinks with disinfecting solution are both difficult to manage and unnecessary.

2. Food storage regulations: Under current state regulations, all food other than uncut fruits and vegetables must be stored in a licensed facility. In other words, a farmer cannot take meat that has been processed at a USDA- or state-inspected processing plant and store it in the freezer on his farm, unless he builds an entirely separate building that meets the requirements for a warehouse or commercial kitchen. The only other alternative is to rent space in a commercial kitchen or warehouse, at significant cost and inconvenience. While not all local jurisdictions are enforcing this requirement, DSHS has confirmed that it is a statewide regulation.

3. Poultry processing: Under Texas law, farmers processing fewer than 10,000 birds or rabbits on their own farm may be exempt from the requirement to have an inspector on-site during slaughter. However, there are extensive regulations that essentially require the equivalent in both structures and procedures as a large commercial facility. In addition, the implementation of the regulations is also confusing and ambiguous. For example, while DSHS used to allow outdoor processing facilities, people applying more recently have been told that the entire facility must be enclosed, at significant expense, although there has been no change to the actual regulatory language.

4. Mobile slaughter units: With the consolidation of the meat industry and the implementation of HACCP regulations by the U.S. Department of Agriculture in the early 1990s, numerous small-scale slaughterhouses went out of business. Local livestock farmers must have access to processing in order to sell meat, but are often at a significant distance away from either a USDA- or a state-inspected slaughterhouse. In other states, mobile slaughter units have been developed to address this problem, but so far no one in Texas has been able to navigate the regulatory barriers.

5. Food processing: Whether it is canned vegetables, prepared meals, or baked goods, there is a great demand for value-added foods. These foods are important not only for the business of food producers, but for the convenience and health of consumers. It is far healthier for people to use these foods as shortcuts while preparing a meal at home than for them to rely on the convenience of fast foods. But there are significant barriers to value-added foods. From commercial kitchen requirements to water quality to licensing, food processors face expensive and time-consuming requirements. As with food storage, the regulations do not allow in-home production, except for the very specific exemptions for small-scale cottage food production under SB 81. A significant barrier to the production of many canned goods in particular is that the class required for producing acidified foods is only offered once a year at one location.

6. Egg grading: Farmers are allowed to sell eggs from their own flock directly to consumers without grading. But they cannot sell those same eggs to a small local grocer or co-op or restaurant. Grading involves weighing eggs, checking their size, and candling for blood spots. It does not provide food safety protections, but is instead a marketing issue, i.e. making sure that the eggs are specific size and quality.

FARFA urges the members of the Committees to work on legislation to:

1. Expand the cottage foods law to allow for sales at farmers markets and to include additional foods classified as non-potentially hazardous by the FDA.
2. Clarify and simplify regulations for farmers and food producers selling directly to consumers, outside the cottage foods law. The simplified regulations should address issues such as: (a.) Sampling (b.) Storage on the farm or in a personal residence (c.) Inspections of in-home or on-farm operations (d.) Processing regulations, including water quality requirements
3. Establish a single permit or permit reciprocity system for direct marketers, with a limitation on fees.
4. Clarify and simplify regulations for small-scale local grocers and other distribution options, to expand the ability of consumers to access local foods.
5. Provide clear, appropriate regulation for on-farm poultry processing and mobile slaughter units.
6. Eliminate the requirement for grading eggs for small-scale farmers.
7. Exempt small-scale producers from regulations authored to address problems associated with large-scale producers.

II. Land use issues: zoning and homeowners associations

As the population density increases, agricultural production is often pushed further and further away from our cities; however, a growing number of people wish to raise food in urban and suburban settings, ranging from fresh vegetables to chicken eggs to goat milk. Unfortunately, city zoning laws and homeowners associations stand in the way, whether the person is raising such food for sale or simply to feed their own families. From front-yard vegetable gardens to the keeping of small livestock, there is a patchwork of confusing and, in most cases, unnecessary restrictions.

An official from the City of San Antonio’s health department recently stated that it was illegal, under the city’s zoning laws, for someone to sell vegetables that they had raised in their backyard. Similar zoning prohibitions on retail activity in residential areas have been used by multiple cities across Texas to scare people away from legal cottage food production under the 2011 cottage foods bill. The City of Frisco has gone so far as to outright ban “cottage food production operations,” even when people are simply giving away the food. Yet the same zoning departments routinely overlook or explicitly allow activities such as the sale of Mary Kay cosmetics, in-home day care centers, music lessons, and other activities that pose significant more risk of disruption for the neighborhoods.

Texas has a “right to farm” law that protects existing farms from most zoning restrictions and even nuisance claims by their neighbors. Under this law, a factory farm can maintain manure lagoons that pollute their neighbors’ property without fear of consequences, being shielded even from a trespass claim for actual intrusion onto the neighbors’ property. Yet anyone wishing to start a new farm or raise their own food is at the mercy of the whims of the zoning board and, in many cases, their homeowners association.

FARFA urges the members of the Committees to work on legislation to exempt urban farms and individual agricultural production (i.e. for a person’s own use) from zoning and homeowners association regulations. We respect every person’s property rights and are not seeking to prevent legitimate suits for actual nuisances or trespass, but merely a recognition that raising food is an important priority in residential areas as well as rural. Such protection would benefit farmers, farmers’ market consumers, and people of all income levels who seek to improve their access to healthy fresh foods.

III. Property taxes and agricultural valuation

Under the Texas Constitution, land that is kept as “open space” is valued based on its actual use, rather than its potential development value. Agricultural valuation is critical to the ability of many farmers to make a living. Agricultural valuation is also vital to nonprofit community gardens who cannot afford to pay high tax bills while providing food for poor and disadvantaged communities.

The Tax Code provides:

(1) “Qualified open-space land” means land that is currently devoted principally to agricultural use to the degree of intensity generally accepted in the area and that has been devoted principally to agricultural use or to production of timber or forest products for five of the preceding seven years or land that is used principally as an ecological laboratory by a public or private college or university. …

(2) “Agricultural use” includes but is not limited to the following activities: cultivating the soil, producing crops for human food, animal feed, or planting seed or for the production of fibers; floriculture, viticulture, and horticulture; raising or keeping livestock; raising or keeping exotic animals for the production of human food or of fiber, leather, pelts, or other tangible products having a commercial value; planting cover crops or leaving land idle for the purpose of participating in a governmental program, provided the land is not used for residential purposes or a purpose inconsistent with agricultural use; and planting cover crops or leaving land idle in conjunction with normal crop or livestock rotation procedure. … The term also includes the use of land to raise or keep bees for pollination or for the production of human food or other tangible products having a commercial value, provided that the land used is not less than 5 or more than 20 acres.

This statutory language should cover the vast majority of small family farmers and community gardens. Yet, as applied, it does not.

Many of our farmers have been told that growing vegetables does not quality as agricultural use. Other uses that have been denied agricultural valuation include pastured poultry, livestock being grazed under sustainable rotational management systems, equines being used for agricultural purposes (including plowing or as livestock guardians), diversified farming systems, and nonprofit community gardens.

Urban farms face additional challenges based on county assessors’ imposing minimum acreage requirements, often 10 acres or more. Yet the state statute does not mandate a minimum acreage even within city limits. According to the most recent census, there are more than 21,000 farms in Texas with less than 10 acres. The majority of farms producing vegetables for sale are under 5 acres. Yet, under current guidelines for property tax valuations, many of these farms are denied agricultural valuation.

With the average age of Texas farmers at 59 years old, new farmers are desperately needed. Yet new farmers face the heavy burden of having to pay development-level taxes for 5 years before their land qualifies for agricultural valuation. In addition, there is a five-year “roll back” tax if the land ceases to be used for agricultural purposes. This means that, in effect, ten years of agricultural use is not recognized.

FARFA urges the members of the Committees to work on legislation to reduce the waiting period before land can be valued for agricultural use, to explicitly recognize fruit and vegetable production as agricultural use, to require counties to take sustainable agricultural methods into account in determining what is an acceptable degree of intensity, and to prevent the imposition of minimum acreage requirements.

IV. Conclusion

While Texas has a rich agricultural heritage, a recent survey ranked us 43rd in the country for farmers markets and CSAs in relation to our population. You have the opportunity to make the changes we need to make Texas a leader in the local and healthy food movement.

Removing the barriers to local food production will provide numerous benefits to our State: (i) providing jobs through small-scale farms, ranches, meat processing plants, local food outlets, and all the equipment and service providers that service them, (ii) reducing government waste by removing unnecessary regulations and streamlining government procedures, (iii) addressing food insecurity, (iv) eliminating food deserts that surround and are in our major metropolitan areas, (v) addressing health and obesity issues through the production of fresh, healthy, and minimally processed foods, (vi) reconnecting our youth to where food is grown and raised, and (vii) making food safer by putting the producers and consumers together in direct, transparent, and accountable relationships.

I urge you to take action on each of the initiatives we covered above, and I would be happy to provide any additional information that would be useful in the process.

Again, thank you for your time. I appreciate the opportunity you have given me today to share the concerns and interests of Texas farmers and consumers.

Respectfully,

Judith McGeary
Executive Director
Farm and Ranch Freedom Alliance
P.O. Box 809
Cameron, TX 76520
254-697-2661 (office)
512-484-8821 (cell)