Fiscal Note & Local Impact Statement

125 th General Assembly of Ohio

Ohio Legislative Service Commission

77 South High Street, 9th Floor, Columbus, OH 43215-6136 ² Phone: (614) 466-3615

² Internet Web Site: http://www.lsc.state.oh.us/

BILL:

Sub. S.B. 202

DATE:

November 8, 2004

STATUS:

As Passed by the Senate

SPONSOR:

Sen. Mumper

LOCAL IMPACT STATEMENT REQUIRED:

No —

Minimal cost

 


CONTENTS:

To revise the laws governing the inspection of meat and poultry, claims for injuries to certain animals by coyotes or black vultures, agricultural easements, and applications concerning new drugs

 

State Fiscal Highlights

 

STATE FUND

FY 2005

FY 2006

FUTURE YEARS

General Revenue Fund

     Revenues

- 0 -

- 0 -

- 0 -

     Expenditures

Potential minimal effect

Potential minimal effect

Potential minimal effect

Note:  The state fiscal year is July 1 through June 30.  For example, FY 2005 is July 1, 2004 – June 30, 2005.

 

·        The bill allows the value of an agricultural easement to be determined by a points-based appraisal system that is to be established by the Director of Agriculture.  Any costs associated with this provision would be minimal and would be paid for out of the Office of Farmland Preservation’s GRF line item.

·        The Director shall establish and review requirements for continuing education courses for weighers, samplers, and testers licensed under the dairy law and grant approval to those that meet requirements.  This could minimally increase expenditures to the Division of Dairy's GRF line item.

·        Under the bill, adjudicatory hearings requested by dairy licensees are moved from the county seat of the county in which the licensee's facility is located to the central office of the Ohio Department of Agriculture (ODA).  This could save travel expenses for the Division of Dairy's GRF line item.  Any savings would be minimal in nature since there have been few hearings in the past five years.

·        Several changes are made regarding the Meat and Poultry Inspection law.  Some changes include granting authority for the Director to deny the re-issuance of a meat or poultry license and allowing for progressive enforcement actions while dealing with meat inspection violations.  The bill also allows the Director to apply to a court of common pleas for a temporary or permanent injunction regarding meat and poultry violations.  These provisions, as well as others affecting the Meat and Poultry Inspection law, should have minimal or no costs to the Meat and Poultry Inspection’s GRF line items.

·        The bill makes changes to the livestock indemnification law by limiting the amount a claimant without a voluntary animal damage control plan may receive for livestock losses or injuries associated with predators.  (ODA) may assist owners in developing and implementing a voluntary animal damage control plan.  The ODA may not use more than 50% of the money appropriated for livestock indemnification or $25,000, whichever is less, to pay for costs incurred while providing assistance for voluntary animal damage control plans.  The ODA will realize increased expenditures for assisting with the voluntary plans; however, the plans should eventually decrease the number of claims submitted which would decrease costs to the Animal Damage Control’s GRF line item.  Also, decreasing costs should be realized due to the provision that limits a claimant’s (without a voluntary animal damage control plan in place) livestock indemnification amount to $500 per calendar year.

Local Fiscal Highlights

 

LOCAL GOVERNMENT

FY 2005

FY 2006

FUTURE YEARS

Counties

     Revenues

- 0 -

- 0 -

- 0 -

     Expenditures

Potential minimal increase

Potential minimal increase

Potential minimal increase

Note:  For most local governments, the fiscal year is the calendar year.  The school district fiscal year is July 1 through June 30.

 

·        The bill allows ODA to apply to the court of common pleas for a temporary or permanent injunction for meat and poultry violations.  This could increase expenditures for county courts.  However, ODA maintains that they will pursue administrative remedies before going to court.  Therefore, the number of injunction requests would be small and costs associated with this are likely to be minimal.

 


 


 

 

Detailed Fiscal Analysis

 

The bill makes several changes to various laws concerning agricultural easements, meat and poultry inspection, livestock indemnification, and food safety in the Ohio Department of Agriculture (ODA).  The changes in the bill and their effects are discussed below.

 

Agricultural Easements

 

Currently, grants for agricultural easement purchases may be made using moneys from the Clean Ohio Agricultural Easement Fund.  Grants may provide up to 75% of the value of an agricultural easement as that value is determined by a general real estate appraiser.  Under the bill, the value of an agricultural easement may also be determined through a points-based appraisal system.  The points-based system shall be established by the Director of ODA and may include any or all of the following factors:

 

·        Whether the county auditor determined land is exclusively devoted to agriculture;

·        Changes in land values after county auditor reappraisal or triennial update;

·        Soil types and productivity;

·        Proximity to land that is subject to agricultural or conservation easement or similar land-use limitations;

·        Proximity to water and sewer lines, road interchanges, and nonagricultural development;

·        Parcel size and roadway frontage;

·        Existence of an operation and management plan developed under the agricultural pollution control provisions;

·        Existence of a comprehensive plan that is adopted by the planning commission of a municipal corporation;

·        Any other factors that the Director determines are necessary.

 

According to ODA, establishing the points-based system and reviewing applications using the system could increase expenditures.  Any work associated with this would be performed by existing, internal staff and would be minimal at best.   A points-based system is currently used by applicants prior to submitting their application to ODA.

 

Soil and Water Conservation Districts

 

The bill allows soil and water conservation districts to acquire agricultural easements.  Soil and water conservation districts are also eligible for matching grants from the Agricultural Easement Purchase Fund within ODA.  This provision is permissive.  Soil and water conservation districts do not have to purchase agricultural easements.  ODA will evaluate their applications for matching grants as any other application would be evaluated. 

 

The bill authorizes a board of township trustees to enter into a contract with a soil and water conservation district, without advertising or bidding, for the purchase of services.  This provision is also permissive.  If a board of township trustees does choose to enter into a contract with a soil and water conservation district, without advertising or bidding, there could be a minimal decrease in expenditures for the board in regards to the advertising expenses.  

 

Dairy Division

 

            Under the bill, the Director shall adopt rules establishing requirements for continuing education courses for weighers, samplers, and testers licensed under the dairy law and review continuing education courses for weighers, samplers, and testers and grant approval to those that meet requirements.  This provision could minimally increase expenditures from the Division of Dairy's GRF line item.  The bill also changes the location of any adjudicatory hearing that a dairy licensee requests.  Currently, the hearing shall take place in the county seat of the county in which the licensee's facility is located.  Under the bill, the hearing will take place in the central office of ODA.  This provision could reduce travel expenses for the Division. 

 

Meat and Poultry Inspection

 

According to ODA’s website, Ohio has the second largest meat inspection program in the nation with 229 plants under full inspection.  The Division of Meat Inspection has 100 meat inspectors that are responsible for overseeing the wholesomeness of meat products.  The inspectors provide daily inspections of all fully licensed meat and poultry slaughter and process establishments.   In 2003, there were 15 notices of violations issued and three withdrawals of inspections carried out.  From 2000 to 2002, there were five cease orders issued.  There have been no cease orders issued since October of 2002. 

 

License Applications and Violations for Meat Inspection and Poultry Inspection

 

The bill adds language that if a meat or poultry establishment is not in compliance after inspection with laws and rules dealing with licensure, the license shall be denied and an applicant may appeal the denial.  Language is also added that gives the Director authority to deny the re-issuance of a license, after the expiration date, if the establishment is not in compliance with laws or rules.  If a meat processing or slaughtering establishment is in violation, the Director may impose progressive enforcement actions or suspend or revoke the license.  Currently, if an establishment is in violation, the Director may withdraw inspection and order the establishment to cease operations.

 

The progressive enforcement authority is in the Ohio Administrative Code (OAC).  The bill is expanding the statutory authority to revoke a red meat license under certain conditions.  The revocation authority is currently available for a poultry license.  According to ODA, the need for the authority for the Director to deny the re-issuance of a license has been limited.  As a result, there should be little or no fiscal effect to ODA.  The other changes within the bill will most likely have little to no effect due to the small number of violations each year.

 

The bill adds language that if a meat establishment is unsanitary and is not in compliance with its hazard analysis critical control point plan, the Director may take actions prior to an adjudication hearing.  The Director shall afford a hearing upon request of the owner of the meat establishment.  The OAC currently authorizes regulatory control action, so there should not be any changes or fiscal impacts for ODA.

 

The bill also adds language that the Director may apply to the court of common pleas in the county in which the meat or poultry violation occurs for a temporary or permanent injunction.  This provision could create a minimal increase in expenditures for counties if injunctions are requested.  However, ODA maintains that they will pursue progressive administrative remedies before going to court.  Also, there have only been two or three times in the past seven years that ODA could have applied to a court for an injunction.  Thus, at most, only a minimal impact on local courts could be expected.

 

Livestock Indemnification

 

The bill makes several changes to the animal damage control program.  It adds that an owner of an animal that has been attacked by a predator shall notify the dog warden by telephone and document by photograph the wounds sustained to the animal.  It also outlines the procedure for submitting a claim for indemnification.  The bill states that the dog warden shall send to ODA the determination of whether the animal was killed or injured by a predator and any other documents, testimony, etc.  The wildlife officer shall notify ODA in writing regarding the determination.  Under the bill, ODA will hear claims that are approved by the dog warden and supported by the wildlife officer.

 

The bill also specifies the amount of indemnification received for an animal.  The definition of “fair market value” is the average price that is paid for a healthy grade animal at a livestock auction that is licensed.  If the owner of an animal does not agree with ODA’s determination of the value of the animal, the owner may appeal the determination.  Claims certified by ODA shall be paid from the GRF except in the following situations:

 

·        A claim for the same loss or injury has been paid or is payable under policy or policies of insurance (in current law).

·        The owner of an animal has been paid more than $500 within the immediately preceding calendar year from money so appropriated.  However, that owner may be paid if the owner has implemented a voluntary animal damage control plan that meets ODA requirements.

 

If at any time money appropriated from the GRF for livestock indemnification purposes, is insufficient to pay certified claims, ODA shall disapprove those claims and those claims shall not be resubmitted.  Also, ODA may assist owners in developing and implementing a voluntary animal damage control plan to prevent and minimize loss or injury to animals by predators or may enter into an agreement with another state agency, a federal agency, or a person to provide assistance.  The ODA may not use more than 50% or $25,000, whichever is less, of the money appropriated for livestock indemnification, to pay the costs incurred for providing assistance or entering into an agreement to provide assistance.  The Director shall adopt rules that establish requirements governing voluntary animal damage control plans.

 

The ODA could realize an increase in expenditures due to the provision concerning assisting owners in developing and implementing a voluntary animal damage control plan.  However, the implementation of voluntary animal damage control plans should eventually reduce costs by reducing the numbers of injuries or attacks that take place.  The ODA will also realize a reduction in expenditures due to the provision specifying that no one should receive more than $500 in indemnification payments in a calendar year.  The bill specifies that the dog warden shall provide assistance in filling out the indemnification form when requested by the owner.  There are also provisions detailing that the dog warden shall send to ODA the copy of the determination and other documents.  The wildlife officer shall send to ODA his or her determination.  It appears that the bill does not expand the role of dog wardens and wildlife officers.  As such, there should be no fiscal impact to local governments. 

 

Food Safety

 

The bill removes the Director of Agriculture’s authority to review applications for new drugs.  According to ODA, the affect of this provision is that the bill will eliminate an existing loophole whereby individuals can try to bypass the U.S. Food and Drug Administration’s authority to review new drug applications. 

 

 

 

LSC fiscal staff:  Wendy Risner, Budget Analyst

 

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