Last Week in Farm Law (June 5, 2020): 9th Circuit Dicamba De-Listing, Farm Act Passes NC Legislature Sans Smokeable Hemp Ban, SSAWG Closes

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Tractor

9th Circuit Suspends Listing of Dicamba

Last week on June 3, the 9th Circuit Court of Appeals ordered the EPA to suspend registration for three Dicamba formulations. The case, National Family Farm Coalition et al v. Environmental Protection Agency, No. 19-70115, (9th Circuit Court of Appeals).

Background. Dicamba is a highly volatile herbicide that has been in use by farmers since its first registration in 1967. Dicamba is toxic to growing plants, including food crops (excepting naturally-tolerant corn and wheat), competitor plant species such as Palmer amaranth, and trees, including oak and elm. Dicamba has been traditionally used to clear fields of vegetation prior to planting or eliminate competition prior to emergence of planted seed. Given its volatility – meaning it vaporizes relatively quickly – dicamba often drifts onto other fields – sometimes up to a mile – when applied in windy and during heat inversions, and has been the subject of numerous crop damage lawsuits.

For weed control following emergence of planted seeds – known as “over the top” (or “OTT”) or “post-emergent” application – farmers have relied on other products including Roundup, a glyphosate-based herbicide. However, by 2000 many targeted weed species had developed a tolerance to Roundup, so Monsanto developed a seed variety of soybean and cotton to tolerate (i.e. survive) a dicamba application. At the same time, Monsanto reformulated dicamba to reduce its volatility, and presented the reformulation to the Environmental Protection Agency (EPA) for registration under the Federal Insecticide Fungicide and Rodenticide Act (FIFRA) 7 U.S.C. §§ 136 et seq. Pursuant to FIFRA authority, EPA granted Monsanto a two-year conditional registration for application of the new dicamba formulations for over the top application to growing dicamba-tolerant crops. This initial registration was to expire in late 2018. Prior to the first conditional registration expiration, EPA issued another two-year conditional registrations to Bayer (who had purchased Monsanto)  for “M1768 Herbicide” (marketed as “XtendiMax With VaporGrip Technology” [“XtendiMax”]); to Corteva for its “DuPont FeXapan Herbicide” (“FeXapan”); and to BASF for “Engenia Herbicide” (“Engenia”). The re-registration allowed for OTT application in 34 states, including North Carolina, Virginia and South Carolina.

The plaintiff’s in the case – National Family Farm Coalition, Center for Food Safety, Center for Biological Diversity, and Pesticide Action Network North America – sought judicial review of EPA’s decision to provide conditional renewal to XtendiMax, Engenia, and FeXapan, claiming violation of FIFRA and the Endangered Species Act [16 U.S.C. § 1536(a)(2)]. FIFRA provides the EPA registration order review jurisdiction to the Circuit Court. [see 7 U.S.C. § 136n(b)]

The Court’s Analysis.  The Court looked closely at two of FIFRA’s relevant requirements, whether the EPA has ensured that 1) the registrant had submitted “satisfactory data” to support the registration decision and 2) the EPA ensured that the granting of registration will not “significantly increase the risk of any unreasonable adverse effect on the environment.” [7 U.S.C. § 136a(c)(7)(B)]. FIFRA applies a judicial review standard to uphold the EPA’s registration decision “if it is supported by substantial evidence when considered on the record as a whole.” [7 U.S.C. § 136n(b)] 

As to the first question, the Court reviewed the data submitted by Monsanto consisting of spray drift reports from field trials conducted in various locations in 2018, as well as telephone reports from the field on drift and damage incidents. In a summary white paper, Monsanto opined to EPA without supporting data that damage was caused by either other products or an older version of dicamba. The Court found that the disclosure of this information simply confirmed data used in the previous (2016) conditional registration, and otherwise did not rise to the “data” standard under FIFRA, 

As to the latter analysis, FIFRA authorizes EPA to consider a pesticide’s economic, social, and environmental costs and benefits in balancing its unreasonable adverse effect on the environment. In meeting this second requirement, the EPA stated in its re-registration decision that, “After weighing all the risks of concern against the benefits of the new uses, the EPA finds that when the mitigation measures for these uses are applied, the benefits of the use of the pesticide outweigh any remaining minimal risks, if they exist at all.” (p. 10)

However, the Court found that EPA underplayed data from drift and damage experience during the 2017 crop year when balancing against the basic benefits of weed suppression. Specifically, EPA referred to a prediction of total soybean acres planted and a reduced-yield impact on the 55% of such acres that was not dicamba-tolerant (“DT”), without providing any further specifics. Further, the agency made reference to non-soybean crops, only noting that these were subject to damage (in that they were not label-approved). In both cases the EPA admitted it lacked sufficient data to quantify either damage assertion. EPA also noted damage to trees and recreation areas reported by state agencies. Finally, the Court found fault with the EPA’s “agnostic” position that damage reports were either under-reported or over-reported, and that this finding was not backed by sufficient evidence. The Court backed its view with credible university research reports that indeed damage following the first conditional registration had been under-reported. Fatal to the EPA registration decision was a failure to estimate dicamba crop damage when data sufficient to support an estimation was widely available.

The Court further noted that the EPA decision did not account for the extent to which “off-label” applications occur, again in light of evidence from earlier that strict label compliance – i.e. weather-specific application – had been a compliance challenge.

In regards to the latter balance of the second review requirement noted above – balancing the benefits with the “account the economic, social, and environmental costs” of the pesticide – the Court noted an economic cost that was not considered by EPA:  that the continued rise in Dicamba use under the re-registration would further require producers to buy DT seed. According to evidence in the record, increasing use of Dicamba was leading toward a monopoly for the companies producing DT seed. As to the “social costs”, the Court found that EPA had not considered the extent to which disputes over Dicamba drift have damaged the fabric of neighbor relations supporting rural communities.

The Court’s Holding. Based on the reasons outlined above, the 9th Circuit held:  “Considering the record as a whole, we conclude that substantial evidence does not support the EPA’s October 31, 2018, decision to grant conditional registrations to XtendiMax, Engenia, and FeXapan for OTT application on DT soybeans and cotton. The EPA found two benefits from the uses, which were amply supported by evidence in the record. But the EPA failed to perform a proper analysis of the risks and resulting costs of the uses.” (p. 53)

The Court denied EPA (and Monsanto’s) request that, in remanding the conditional re-registration decision back to the EPA to address the lack of substantial evidence noted in the case, that the 2018 conditional registration remain in place during that process. The Court declined to do so.

Impact. The decision will undoubtedly impose uncertainty and costs on North Carolina farmers. On Friday June 5, 2020, EPA Administrator Andrew Wheeler issued a statement of disappointment with the decision, pledging that the “EPA is assessing all avenues to mitigate the impact of the Court’s decision on farmers.” Numerous states have requested EPA as to guidance on how the 9th Circuit Order will be enforced.

North Carolina is one of a number of states with statutory authority – concurrently with FIFRA – to allow state registration of  pesticides for restricted use applications. Commissioner of Agriculture Steve Troxler has issued a statement of concern, but has not advised dealers to continue selling their stock of the de-registered chemicals or farmers to apply them.

NC Farm Act of 2019 Passes NC Legislature

The North Carolina legislature last week passed the North Carolina Farm Act of 2019, a compendium of statutory changes impacting agriculture, forestry and natural resources. The 2019 Farm Act as passed at the close of 2019 failed to secure approval from Governor Cooper.

The revised Farm Act – SB315 – passed the NC House 86-34 and the NC Senate 39-9, and was presented to Governor Cooper on June 9, 2020 (no action as of press time).

Stripped from the 2019 version is SB315’s most controversial feature – a ban on smokeable hemp. This feature created a fair measure of debate between the law enforcement community – who saw legal smokeable hemp as a de-facto legalization of cannabis  – and the hemp farming community, for whom the flower of the hemp plant is the most profitable product of the plant.

Also stripped from the 2019 is a provision qualifying shooting ranges as zoning-exempt bona fide farms. The passed version does however make some further revisions to the bona fide farm exemption. Specifically, SB315 adds hunting, fishing, equestrian activities to the NCGS §99E-30 definition which qualifies farms with certain signage for liability protection, and adds the same language to the definition of agritourism in NCGS § 153A-340(2a), which qualifies certain agritiourism buildings for bona fide farm zoning exemption status. Additionally, an exemption from § 136-129 restrictions on outdoor signage is extended to bona fide farms.

Included is a revision of § 143-215.10I, regarding swine waste management permitting, to provide the Soil and Water Commission more flexibility in approving systems that do not increase swine capacity without the requirement of issuing a new permit. Also retained is the provision on confidentiality of soil and water district records regarding information supplied by participants on farm and land management related to soil and water programs. Arguably, according to critics, this will hamper discovery of evidence in future nuisance suits against swine operations.

Lastly, SB315 retains provisions for the abandonment of unused utility right of ways, and new notice and appeal provisions for owners of property who lose Present Use Value property tax program qualification.

Southern SAWG Closes its Doors

Sadly, the Southern Sustainable Agriculture Working Group – a regional non-profit serving small scale farmers from Texas to Virginia, announced its closure this week. Over the course of my career I was honored to present half a dozen times in both Chattanooga, Tennessee and Little Rock, Arkansas, the two alternating locations for SSAWG’s annual conference. My last presentation – on small farm liability issues – was in January 2019, where I co-presented with Lauren Manning from University of Arkansas Law School. What struck me about the event was its diversity, and it was one conference one could attend and learn about the farming lives, travails and opportunities of farming in different states throughout the southern United States. As a native Texas – with kin from Louisiana – I particularly enjoyed connecting with farmers, farm advocates and educators from these areas. The conference was the source of great memories traveling with colleagues Tony Kleese (who passed in 2018) and Gerry Cohn, now a regional director for Organic Valley CROPP Cooperative. The Board of Directors undoubtedly faced a challenge in reaching this decision. Here is SSAWG’s official statement on closure.