Livestock Identification and Inspection Changes

Overview: Legislation passed in 2019 resulted in significant changes to the laws and processes regarding brand inspection and individual livestock identification. These changes include different fees and some strong incentives to move to electronic livestock identification and reporting in lieu of using brand inspectors. Dairy farmers should consider using some of these options to lower fees and reduce the need for brand inspectors.

Background and Approach: Most dairy farmers do not need, use, or want to brand animals. Some producers (around 15%) do brand. In our conversations with legislators and stakeholders, we respected the needs of both segments of our membership. We sought to preserve brand options for producers who want branding for asset protection, while also ensuring that producers who do not brand are not forced to pay for a program they do not use. We advocated for additional program efficiencies, options such as electronic reporting, and efficient and accurate individual animal traceability for disease prevention, traceability, and commerce.

What happened during the 2019 legislative session? After more than a year of discussions about this legislation, wide differences still existed between our approach, what the Cattlemen wanted, and what the Washington State Department of Agriculture would accept. The Cattlemen wanted a brand program. WSDA wanted to make sure the brand program was adequately funded. There were serious attempts to modernize animal traceability to respond to disease outbreaks.

The final version of the legislation (ESSB 5959) includes some of these components. The final text of ESSB 5959 can be found here: http://lawfilesext.leg.wa.gov/biennium/2019-20/Pdf/Bills/Session%20Laws/Senate/5959-S.SL.pdf#page=1.

Unfortunately, ESSB 59595 placed disproportionately higher fees onto unbranded and unidentified animals to pay for brand inspection services at WSDA. We did not support the final bill because farmers who do not use the brand program should not be forced to pay for it.

Details of Major Changes in ESSB 5959: The new law has some options that will benefit most dairy farmers, including ways to reduce fees to support the brand program.

  • New Fees: On July 28, 2019, new fees will be implemented at all points of “brand inspection.” 
    • For livestock with electronic official individual identification (currently an 840 RFI tag) or branded livestock, the inspection fee will be $1.21 per head. (This is a fee reduction of 39 cents for farmers who have been selling 840 tagged animals.)
    • The fee goes from $1.60 to $4.00 for “slick” animals (i.e., animals not identified with either a brand or electronic official individual identification.)
    • If you call a brand inspector out to your farm to oversee a cattle transaction, there will be an additional “call out fee” of $20 (which may be more or less than the previous “time and mileage” charges that were eliminated). Private parties can be certified as brand inspectors, in addition to the previous allowance for veterinarians to do brand inspections. Regardless of who does the inspection (a private party or WSDA), the fees are the same. Unfortunately and illogically, the “call out fee” goes to WSDA even if a private inspector or veterinarian provides the service.
  • Electronic Reporting: There are expanded options and incentives for using the Electronic Cattle Transaction Reporting (ECTR) system. The ECTR system website can be found here: https://agr.wa.gov/departments/animals-livestock-and-pets/livestock/ectr. As of June 19, 2019, the ECTR website had not been updated to reflect the recent legislative changes.
    • ESSB 5959 expands ECTR to all animals – branded or not. It is expanded beyond just dairy and in-state transactions. The definition of ownership is broadened to recognize electronic official individual identification as proof of ownership, including proof of ownership for out of state transactions.
    • The changes to ECTR eliminate the need for a state brand inspector and brand fees for anyone selling animals with official 840 tags. ECTR is only when you sell livestock with official 840 tags. If you still have tags that start with the number 982, these tags are not official. You should consider asking your tag supplier to switch your tags to 840’s.
    • As the use and volume of the ECTR system increases, the fees must, by law, decline to match the costs of WSDA to administer ECTR. Since ECTR fees are not used to support the brand inspection system, ECTR costs should remain steady or even decrease with more usage. $1.30 is current ECTR fee, and we will insist WSDA reduce fees to match expense as volume increase. We expect ECTR fees to decrease to around 60-70 cents, with no call out fees and no need to call a livestock inspector. For these reasons, we recommend producers use ECTR for livestock sales.
  • Sunset: Major portions of the bill related to fees expire July 1, 2023, due to uncertainty about financing the program after so many policy changes and due to future animal ID changes from USDA (see below).

Other Changes Pertaining to Livestock ID and Inspections:

  • USDA will be charging for the metal Bangs tags starting January 1, 2020.
  • After December 2020, USDA will no longer issue metal Bangs tags and is moving to recognize only 840 numbered official RFI tags. In 2023 USDA will require 840 tags as proof of Bangs vaccination. Metal tags will not be recognized.
  • If you put 840 tags in at birth or for management use, there is now a way for your veterinarian to “electronically report” that tag number as Bangs vaccinated. You do not need the orange USDA issued RFI Bangs tag. Some producers may want to wait to put in 840 Bangs tags when they vaccinate, but you also have the option of putting in any color button or an 840 RFI dangle tag and ask your veterinarian to report that tag number as vaccinated.
  • The bottom line is that you should make sure you are using some version of an RFI tag that is an 840 numbered “official tag.”
  • USDA will be issuing rebate certificates of around 50 cents to help producers and veterinarians with the added costs of RFI tags. As we get more information, we will report where and how those certificates are available.

2019 Legislative Summary

The 2019 legislative session ended up as an overall positive session. It began with a myriad of rather scary legislative ideas and agendas from Gov. Inslee, the Senate, and some House Democrats. Generally, the bad things died, and some good things passed. Here are the highlights:

Ag Slavery Bill (SB 5693): This bill caught the ire of farmers statewide. Supporters of SB 5693 accused farmers of slavery and human trafficking, something that we vigorously and aggressively argued against. The bill would have required certain Washington retailers and manufacturers of agricultural products to make annual disclosures on their websites’ homepages about their efforts with respect to their product supply chains to eradicate slavery and human trafficking and to ensure compliance with the employment laws. The bill died in the Senate.

Brand Inspections (SB 5959): This issue was a hard, painful slog. There is a two-page detailed summary for producers to review, since there are significant changes to the processes and fees associated with brand and livestock inspection. This bill passed both chambers and was signed into law.

Dairy Milk Assessment Fee (HB 1429): This bill extends until 2025 a dairy milk assessment fee that was due to expire next year.  That fee, paid by milk processors, pays for the inspection services that are required for Washington milk to comply with the “Grade A” Interstate Pasteurized Milk Ordinance – the national standard for milk sanitization. The bill passed both chambers and was signed into law.

Environmental Justice (SB 5489): The bill would have created a task force at Department of Health to develop guidance for state agencies to use when adopting rules. This guidance would have included use of a cumulative impact analysis and application of the precautionary principle (i.e., the rejection of a project or action unless the proponent can prove no harm), providing another powerful tool for state agencies to use to deny permits. The bill passed the Senate but died in the House.

Farm Vehicle Weight Flexibility (SB 5883):  authorizing vehicles carrying farm products to exceed total gross weight limits: This bill allows a vehicle or combination of vehicles carrying farm products from the field to exceed weight limits by up to 5 percent on public highways in Washington. Violations are tracked per driver, and each driver may receive up to two warnings each calendar year before a citation is issued. This bill passed both the Senate and House and was signed by Gov. Jay Inslee.

Graduated Real Estate Excise Tax (SB 5998): A new graduated real estate excise tax will replace the state’s current flat tax of 1.28 percent on all sales. Under the new structure, a 1.1 percent tax would apply to property sales up to $500,000, a 1.28 percent tax would apply to sales between $500,000 and $1.5 million, a 2.75 percent tax to sales between $1.5-3 million. Agricultural and timber lands are exempt from the tax rate increase and will continue to pay the current base rate of 1.28 percent. Business property not enrolled in a current use property tax program will be subject to the new graduated tax. This bill passed both chambers and was signed into law by the governor.

Gravel and Sediment Management (HB 1579): We were able to include in the Orca and Salmon bill (“Implementing recommendations of the southern resident killer whale task force related to increasing chinook abundance”) a provision to allow some experimentation in gravel and sediment management in three counties. While the bill passed both houses, unfortunately the governor vetoed this section. We continue to hear from producers impacted by rivers that are currently completely unmanaged for sediment and erosion. We will not stop trying to find solutions to allow us to intelligently manage rivers to prevent disastrous loss of farmland.

H-2A Fees (SB 5438): The original language in this bill would have required users of the federal H-2A program to pay additional application and per worker fees to the Employment Security Department for state administrative costs associated with the H-2A program. Users already pay federal fees to use the program. These inappropriate state fees were removed from the bill, and the amended bill establishes the office of Agricultural and Seasonal Workforce Services and an advisory committee to address labor issues in agriculture. The bill passed the Legislature and was signed by the governor.

Long-Term Services and Supports Trust Program (HB 1087): The Legislature created a new long-term care insurance program to employees in Washington. Beginning on January 1, 2022, employers must begin collecting premiums for the new Long-Term Services and Supports Trust Program. Premiums will be paid entirely by employees through a 0.58% payroll tax remitted to the Employment Security Department. ESD will use the Paid Family and Medical Leave Program as a model to establish the Long-Term Services and Support Trust Program’s collection and reporting process. Benefits will begin for eligible employees on January 1, 2025. To become eligible, Washington residents will have to work three years within the previous six years or a total of 10 years with at least five years of uninterrupted work. In addition, a person will have to work at least 500 hours in a year for that year to count towards eligibility. To qualify for the benefit, an individual must need help with at least three daily living tasks, as determined by Washington’s Department of Social and Health Services. The maximum lifetime benefit will be $36,500 per person, with future increases tied to the consumer price index. Individuals who have purchased long-term care insurance can opt out of the program.

Pesticide Application Safety (SB 5550): This bill was a negotiated response to pesticide drift/notification bills from previous sessions. It creates a committee (similar to the old PIRT panel) that will meet at least three times each year and must provide an annual report to the Legislature. The first priority of the committee is to explore how state agencies collect and track pesticide incident data. An advisory work group is created to collect information and make recommendations to the full committee on topics requiring unique expertise and perspectives on issues within the jurisdiction of the committee. In addition to fund the committee, the budget granted WSDA $250,000 in one-time funding to expand training for pesticide handlers and air-blast sprayer operators. The bill passed the Legislature and was signed into law.

Qui Tam Whistleblowers (HB 1965): This bill would have allowed anyone to bring actions on behalf of the state for violations of workplace protections. The “qui tam” legal actions would mean that any individual could act when a state agency chooses to not move forward with an enforcement action against an employer. Opening this door would likely result in an increase in frivolous legal actions against employers. The bill died in the House.

Wage and Salary Information (HB 1696): This bill prohibits employers from seeking the wage or salary history of job applicants. It requires employers with 15 or more employees to provide job applicants the minimum wage or salary for the position upon request after an employment offer is made to the applicant. Also, employers with 15 or more employees are required to provide the wage scale or salary range of the new position when an employee is offered a transfer or promotion and requests the wage information. The bill passed both chambers and was signed into law.

Wage Liens (HB 1514): This bill would have created procedures for establishing, foreclosing, extinguishing, and prioritizing wage liens for claims on unpaid wages. These changes would have altered the priority of liens on real property even if the other parties holding a lien were not a party to the wage dispute. The bill died in the House.

Budget: There were several notable successes, usually a specific program or a regionally important win.

  • Carbon and Conservation: A small budget note was inserted in the final budget that directs WSDA and the Conservation Commission to evaluate all existing needs for Conservation. This started as an attempt to push forward legislation (SB 5947) to establish a large farm carbon reduction program at WSDA. Our concern was that carbon reduction is good, but if it leaves other important Conservation activities without enough funding then farmers will get praised for reducing carbon and flogged for not doing enough to improve soil, water, and air quality. Efforts to improve water quality for shellfish farms, the Voluntary Stewardship Program, and salmon and wildlife habitat should be complementary and integrated rather than competing for scarce conservation incentive dollars and technical assistance funding for the Conservation Districts. The evaluation will be done this summer and should allow us to show what the real need is to implement all the existing conservation expectations as well as add carbon reduction activities to the mix. 
  • Chehalis Valley Habitat and Flood: The capital budget provided $79 million to continue the work in the Chehalis Valley to work on salmon habitat and to finish the permitting and final environmental evaluation of a flood control dam in the Upper Chehalis Valley. A flood control structure would prevent the catastrophic damages like those suffered by many of the 30 dairy farms in 2007. The fish recovery work will hopefully prevent a listing of the Spring Chinook salmon in the Chehalis Basin. (The Chehalis Basin is the only river in our state without an ESA listing.)
  • Dairy Nutrient Innovation Grants: An additional $1 million was added to the $5 million in dairy nutrient innovation grants that were funded in the previous biennium. These funds should complete an advanced distillation system in Northwest Washington to process dairy manure into dry or very think slurry, approximately 13 million gallons of clean water per year and produce a new product from manure – an ammonia water product that has already been certified in Texas as an organic pure nitrogen fertilizer that looks like it will be of interest to organic grain, vegetable, and greenhouse farms.
  • Environmental Justice: An Environment Justice Work Group will receive $390,000 to recommend strategies for incorporating environmental justice principles into how state agencies discharge their responsibilities. This language is vastly superior to the what was in the standalone bill (SB 5489), which died.
  • Soil Health Initiative: WSU was allotted $500,000 for new soil health research and extension activities to develop, evaluate and incentivize best management practices for agricultural. Some activity must be conducted at the research and extension center in Mount Vernon.
  • Wage and Hour Investigations: L&I received $1.26 million from workers’ comp dollars to initiate and conduct targeted, company-wide investigations where it appears (e.g. based on investigation of an individual worker complaint) other workers may not be receiving the wages, breaks, and/or paid sick leave they are owed.
  • Yakima Integrated Plan: The capital budget provided $30 million for continued work on the Yakima Integrated Plan that will increase water storage to improve reliability and drought supply for the Yakima irrigation system.

Washington State Regulatory Update – June 2019

Executive, Administrative, and Professional (EAP) Exemptions: The Department of Labor & Industries recently released its proposed changes to its rules on the state Minimum Wage Act (MWA) exemptions for executive, administrative, professional, and outside salespersons.

Two factors make employees exempt from the MWA (and thus minimum wage and paid sick leave): (1) the duties they perform, and (2) the wages they earn.

These proposed rules change the state duties test to conform with the federal duties test. However, the rules will raise the salary threshold for workers to qualify for this exemption. The threshold will ultimately be set at 2.5 times the state minimum wage and will increase over 6 years at different rates depending on the size of the employer. See the attached chart for more information.

For an employee to be exempt, he or she must earn more than the threshold and perform duties consistent with the exemption.

The intended result of the rulemaking is for lower-paid managers (those earning below the wage threshold) to be eligible to receive overtime pay for hours over 40 in a work week (as opposed to being paid just their salary).

For agriculture, this means that workers who are currently exempt may not be exempt in the future. Overtime would have to be paid to those workers for any hours over 40 in a week. However, the overtime rate of pay for production agriculture would be straight time (as opposed to time and a half in most other industries), as long at the current overtime exemption remains in place.

Public hearing dates: July 15, 2019 – August 7, 2019
Written comments due by: September 6, 2019
Intended adoption date: December 3, 2019

http://www.lni.wa.gov/rules/AO18/08/1808CR102.pdf
http://www.lni.wa.gov/rules/AO18/08/1808Proposal.pdf

Paid Family and Medical Leave (PFML): Rulemaking for the PFML insurance program continues without controversy at the Employment Security Department. ESD ran into some delays in accepting premium payments from employers. First and second quarter 2019 premium payments and reports should be submitted to ESD between July 1 and July 31 of this year. ESD has released an updated version of its Employer Toolkit, available on the PFML employer website at: https://paidleave.wa.gov/employers. Rulemaking on employee benefits is ESD’s current focus. Washington workers will be able to use Paid Family and Medical Leave benefits starting in 2020. These benefits will generally allow up to 12 weeks of paid leave per year to care for an employee or an employee’s family.

Worker Protection Standard: EPA changed the WPS rules a couple years ago. The Washington State Department of Agriculture adopted emergency rules that put our state rules into conformity with the federal rules. However, since there is shared jurisdiction with L&I’s Division of Occupational Safety and Health, L&I is adopting its own rules. The rules between L&I and WSDA must not conflict. After prolonged discussions with WSDA, L&I is moving forward with adopting its own rules that are the same as the EPA and WSDA rules, with the following exceptions, which are more protective:

  • Definition of immediate family;
  • Cartridge change out schedule;
  • Enclosed cab respirator;
  • Use of most protective personal protective equipment;
  • Eyewashes must provide 0.4 gallons or 1.5 liters per minute for 15 minutes with single point of operation; and
  • Heat stress requirements retained.

Public hearing dates: August 20 to August 23, 2019
Written comments due by: August 30, 2019
Intended adoption date: October 22, 2019

The proposed rules can be found here:
http://www.lni.wa.gov/rules/AO16/35/1635CR102.pdf
http://www.lni.wa.gov/rules/AO16/35/1635Proposal.pdf

Once these rules are adopted, WSDA will update its rules to correspond to the L&I rules.

Hearings Board Issues CAFO Permit Ruling

The Pollution Control Hearings Board ruled October 25 on the CAFO permit appeal, handing a partial victory to Washington State Dairy Federation and Washington Farm Bureau.

The extreme activist coalition, led by Charlie Tebbutt and Puget Sound Keeper Alliance (PSA), was issued a TOTAL DEFEAT. The Hearings Board generally held their demands to be unsupported by science, and not reasonable to implement.

“The Board finds that the evidence established that a two foot vertical separation measured from the top of the liner inside the lagoon to the water table is sufficient for attenuation of pathogens and viruses.”

As a result, the Hearings Board has ordered Ecology to modify the permit to be consistent with NRCS on where to measure the vertical separation.

This means that functioning lagoons cannot be deemed deficient because Ecology wanted to change the measuring point for the vertical separation requirement.

Dairy Federation also challenged manure spreading limitations, excessive soil sampling requirements (depth and frequency), and the adaptive management requirements. In all these matters, the Hearings Board deferred to Ecology.

PSA demanded groundwater monitoring, surface water monitoring, individual (versus programmatic) permit standards and hearings, double synthetic liners with leak detection, and more. The Hearings Board ruled that PSA provided insufficient science to justify their demands.

“The Board concludes that PSA failed to prove that surface water monitoring is necessary.”

“The Board concludes that PSA failed to prove that ground water monitoring is necessary.”

“Ecology also determined that available information did not support a conclusion that seepage from all lagoons was resulting in the contamination of groundwater.”

The ruling can be appealed to Superior Court, if an appeal is filed within 30 days.

Dairy Federation is continuing to review the ruling and is consulting with legal counsel.

All dairies are required currently to comply with the Dairy Nutrient Management Act.  The additional requirements of the CAFO permit apply to CAFO permittees.

You may apply for the CAFO permit voluntarily but are required to apply if you have a discharge to surface water or ground water.

The decision to apply for a permit should be weighed carefully.

We will have additional discussion and review by legal counsel and crop consultants at the Washington Dairy Conference, Annual Meeting & Trade Show at Great Wolf Lodge December 3-5, 2018. Registration is free for Grade A dairies (and you can bring your family).

To register, go to www.WaStateDairy.com.