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VOLUME 17, NUMBER 12, WHOLE NUMBER 205 NOVEMBER 2000

feedlot
County f re
eedlot r inv
egulations invalidated
The development of large swine production facilities has been highly controversial
in Nebraska for the past several years, On November 1, 2000, the Nebraska Supreme
Court issued its first decision dealing substantively with local government efforts to
regulate large swine facilities. In Enterprise Partners v. Perkins County, 260 Neb.
650 (2000), the court ruled that county regulations requiring swine lagoons to be
covered and regulating discharges from lagoons onto county roadways were zoning
regulations, and in this case were invalid because no comprehensive plan had first
been adopted. The court came to the correct conclusion but used an incorrect legal

INSIDE rationale that will cause needless confusion regarding livestock zoning by local
governments.
Plaintiffs sought to construct swine production facilities in Perkins County, which
at all times pertinent to the decision had not adopted county zoning regulations.
• Ag production Many rural Nebraska counties have raced to adopt county zoning regulations in an
contracts effort to keep out large swine facilities. In April 1998, the county notified the
Nebraska Department of Environmental Quality (NDEQ), the state agency respon-
on the Internet sible for permitting livestock facilities, of the county’s objection to plaintiff’s
• New water quality proposed swine facilities. NDEQ replied, inter alia, that it had no legal authority to
regulations raise address two of the county’s concerns, flies and odors and the impact on county roads.
questions about EPA In response, the county board in December 1998 adopted the two ordinances at issue
influence over in an attempt to prevent the swine facilities from being developed. Plaintiffs sought
to enjoin the regulations, arguing that they constituted invalid zoning regulations
agricultural practices because no comprehensive development plan had first been prepared as required by
• State Roundup Neb. Rev. Stat. section 23-114.03. The trial court ruled (correctly) that the regula-
• Oops! Why did we tions were not zoning regulations but (incorrectly) that the regulations were valid,
create a web site? enforceable police power regulations. The Nebraska Supreme Court reversed on
appeal.
The supreme court noted that “zoning is ‘the process that a community employs
to legally control the use which may be made of the property and the physical
configuration of development upon the tracts of land located within its jurisdiction,’”
Solicitation of articles: All AALA citing Ford v. Converse Cty Com’rs, 924 P.2d 91, 94 (Wyo. 1996). The court then, with
members are invited to submit no further analysis, concluded that the two Perkins County ordinances were zoning
articles to the Update. Please in- regulations. Since the county had conceded that it had not yet prepared a compre-
Continued on page 2
clude copies of decisions and leg-
islation with the article. To avoid
duplication of effort, please no- ebr
Ne braska
br Supreme
aska Supr Court
eme Cour enforces
t enf orces
tify the Editor of your proposed
article. hedge-to-arri
hedge-to-arr contracts
ive contracts
The Nebraska Supreme Court resolved the hedge-to-arrive controversy in Nebraska
by ruling on September 1, 2000 that such contracts are enforceable. Sack Bros .v

IN FUTURE Great Plains Co-op, 260 Neb. 292 (2000). Eight HTA cases were consolidated in the
Sack Bros appeal. In each case, the cooperative had sold grain futures contracts for
the farmer-plaintiffs with the cash price to the producers to be determined pursuant

I SSUES to written HTA contracts. The farmer-plaintiffs all warranted in the HTA contract
that they had possession of or would obtain the commodity to deliver on the futures
contract. The contract terms for type and grade of grain, delivery information,
destination, number of bushels, futures contract, futures price, final pricing date,
cash basis, and cash price were written in the form contracts. The contracts required
the producers to set the cash price for the contract prior to the first delivery day for
• Refresher on the the contract delivery or futures month in the contract. If the producer was unable
to deliver, the producer could request the cooperative to extend the delivery date.
farm program Apparently producers incurred losses on the HTA contracts as they were rolled over.
eligibility and At trial, the producers contended that parole evidence would prove that the
limitation rules parties’ intent regarding rolling delivery dates forward converted the HTA contracts
into futures contracts. The trial courts in all cases rejected the offer of parole
evidence, ruled that the HTA contracts were not futures contracts and were
Continued on page 2
FEEDLOT/CONTINUED FROM PAGE 1

hensive plan, the supreme court con- and other land developers to resist mu- this result was not its intent when live-
cluded that the ordinances were invalid nicipal extraterritorial police power regu- stock zoning issues reach the court again
zoning regulations. lations as being invalid zoning regula- (as they are likely to do in the near
In Nebraska, counties do not have gen- tions, thus requiring communities to future).
eral police power authority. However, adopt zoning regulations in order to be —J. David Aiken, Professor of Water
Neb. Rev. Stat. section 23-174.10 autho- able to implement their police power & Agricultural Law,
rizes counties to adopt police power regu- regulations (as zoning regulations). Hope- University of Nebraska
lations to protect the public health, safety, fully the supreme court will clarify that
and welfare if the county has first adopted
county zoning regulations. The Enter-
prise court should have characterized the
two Perkins County regulations as police HTA/Cont. from p. 1
power regulations, and then invalidated enforceable, and that the farmer-plain- ducers were merchants for purposes of
those regulations because the county had tiffs had breached the contract by failure the merchants exception to the statue of
not first adopted zoning regulations. In- to deliver. frauds. The court finally ruled that the
stead, the court mischaracterized the The supreme court ruled that the trial defendants’ costs in covering for the
regulations as zoning regulations and courts properly excluded parole evidence nondelivered grain were the proper mea-
invalidated them because of the absence regarding varying the delivery terms of sure of damages (which totaled over $2
of a comprehensive plan. The difficulty the written HTA contracts. The court million).
posed by this is that Nebraska communi- ruled that open delivery and destination Nebraska grain farmers have found
ties are authorized to exercise police terms did not make the contracts am- out to their detriment that they will be
power authorities within their extrater- biguous. The court ruled that the HTA legally held to their written promises to
ritorial zoning jurisdiction even if the contracts were not futures contracts sub- deliver grain in the future even when the
community has not adopted zoning. En- ject to federal regulation, but instead market price goes against them. It is an
terprise will allow livestock operators were cash forward contracts and ex- expensive lesson that each generation of
empted from Commodity Exchange Act farmers seems destined to learn.
regulation, citing Salomon Forex Inc v. —J. David Aiken, Professor of Water
Tauber, 8 F.3d 966 (4th Cir. 1993). The & Agricultural Law,
Nebraska Supreme Court ruled that the University of Nebraska
contracts were not illusory, and that pro-

VOL. 17, NO. 12, WHOLE NO. 205 November 2000

AALA Editor..........................Linda Grim McCormick
Rt. 2, Box 292A, 2816 C.R. 163
Alvin, TX 77511 production
Ag pr contracts
oduction contracts on the Internet
Phone: (281) 388-0155
FAX: (281) 388-0155 The Farm Division of the Iowa Attorney contract prohibits a farmer from sharing
E-mail: lgmccormick@teacher.esc4.com General’s office now offers over thirty information or terms of the contract. In
Contributing Editors: Anne Hazlett, Agricultural Law sample livestock, grain production, and 1999, the Iowa Legislature enacted legis-
Program, University of Arkansas, Fayetteville, AR; marketing contracts free of charge on the lation to protect Iowa farmers using pro-
Barclay R. Rogers, Agricultural Law Program,
University of Arkansas, Fayetteville, AR; James B.
Internet. Each contract is an actual con- duction contracts. The legislation in-
Dean, Denver, CO; J. David Aiken, University of tract from agribusiness companies and cluded a ban on the use of confidentiality
Nebraska; Jeff Feirick, The Dickinson School of Law. includes financial terms. The producers’ provisions in future contracts and made
For AALA membership information, contact names and any identifying information the confidentiality provisions unenforce-
William P. Babione, Office of the Executive Director, about them have been deleted. Some of able in existing agreements. Iowa Code
Robert A. Leflar Law Center, University of Arkansas,
Fayetteville, AR 72701. the many contracts are from Cargill, IBP, Ann. section 202.3 (West 2000). Without
Land O’Lakes, Pioneer, and Purina. the confidentiality clause, Iowa farmers
Agricultural Law Update is published by the
American Agricultural Law Association, Publication
Some of the types of contracts avail- are free to shop around for the best con-
office: Maynard Printing, Inc., 219 New York Ave., Des able are: tracts for their farms.
Moines, IA 50313. All rights reserved. First class · swine marketing contracts The Iowa Attorney General web site
postage paid at Des Moines, IA 50313.
· swine production contracts also contains production contract “check-
This publication is designed to provide accurate and · cattle production contracts lists” for both livestock and grain farm-
authoritative information in regard to the subject
matter covered. It is sold with the understanding that · cattle marketing contracts ers. Each list contains many points that
the publisher is not engaged in rendering legal, ·soybean and organic soybean produc- farmers should consider before they en-
accounting, or other professional service. If legal advice
or other expert assistance is required, the services of
tion contracts, and ter into a production contract.
a competent professional should be sought. · corn production contracts. —Jeff Feirick, The Dickinson School
Views expressed herein are those of the individual of Law.
authors and should not be interpreted as statements of
policy by the American Agricultural Law Association. There are currently no poultry con- This publication is designed to provide
tracts listed, although the list will be accurate and timely information and is
Letters and editorial contributions are welcome and
should be directed to Linda Grim McCormick, Editor, updated as contracts are received. strictly educational in nature. It is not
Rt. 2, Box 292A, 2816 C.R. 163, Alvin, TX 77511. To view a contract, go to http:// intended to be legal advice. For specific
Copyright 2000 by American Agricultural Law
www.IowaAttorneyGeneral.org and se- answers to an agricultural contracting
Association. No part of this newsletter may be lect “Farm Advocacy.” question, you should consult your attor-
reproduced or transmitted in any form or by any means, Many production and marketing con- ney.
electronic or mechanical, including photocopying,
recording, or by any information storage or retrieval tracts contain a “confidentiality clause.”
system, without permission in writing from the A confidentiality clause in a production
publisher.

2 AGRICULTURAL LAW UPDATE NOVEMBER 2000
SOUTH DAKOTA. Plaintiff denied relief —State Roundup— was correct. The court found that the tort
for trade secret miappropriation. In Weins tion, program, device, method, technique claims were so inextricably linked to the
v. Sporleder, 605 N.W.2d (S.D. 2000), the or process.” The question of fact is as- trade secret claim that the tort claims
South Dakota Supreme Court clarified sessed under the second part of the stat- are displaced as a matter of law. South
the relationship between the state’s Uni- ute, which looks at the derivation of Dakota’s adoption of the Uniform Trade
form Trade Secret Act and business tort economic value, whether the secret can Secrets Act prevents a plaintiff from
claims in a case involving the formula- be readily ascertainable, and efforts to merely restating their trade secret claims
tion of livestock feed. maintain secrecy. Even if Weins’ product as separate tort claims. A plaintiff may
In Weins, the plaintiff sought relief for was considered a trade secret under the not rely on acts that constitute trade
misappropriation of his feed supplement first part of the statute, it failed under secret misappropriation to support other
formula, which he considered to be a the second part. causes of action. Ed Nowogroski Ins., Inc.
trade secret. Weins was employed with a Weins has the burden of proving the v. Rucker, 88 Wash.App. 350 (1997).
feed company and began working on a existence of a trade secret, and he never The supreme court again reversed and
fermentation idea. He talked to several clearly asserted what exactly was claimed directed a judgment in favor of Sporleder
people about further developing this prod- to be his trade secret. His product is a and Van Liere.
uct. Among these people were Sporleder combination of well-known feed materi- —Leigh Ann Durham, LL.M. student,
and Meyer, who afterward, entered into als. In the early development stages, he University of Arkansas School of Law
a business arrangement with Weins. The was denied a patent on this supplement
three men began developing the supple- because of ordinary skill of development. MICHIGAN. Federal district court
ment using basic feed ingredients. When The combination of these materials can- awards EAJA fees After a hotly contested
they could not contrive an appropriate not be considered a trade secret if the administrative appeal of an ASCS deci-
consistency, Sporleder suggested using formula is in the realm of general skill sion regarding 1992 disaster benefits,
phosphoric acid as a limiting agent to and knowledge in the relevant industry. the Federal District Court for the East-
keep cattle from overeating. Although Computer Care v. Service Sys. Enters., ern District of Michigan awarded Equal
the formula was starting to show prom- Inc., 982 F.2d 1063 (7th Cir. 1992). If the Access to Justice Act (EAJA) legal fees to
ise, Weins and Meyer terminated their information can be readily duplicated the prevailing farmer in the amount of
relationship with Sporleder. without involving considerable time, ef- $99,500.00. Equal Access to Justice Act,
Sporleder then approached Van Liere fort, or expense, then it is not a secret. Id. 28 U.S.C. section 2412.
with a proposed feed supplement idea An expert testified that the formula of a Producer, William P. Irwin, appealed
that was supposedly different from Weins’ feed product can be established in twenty the decision of ASCS to deny him benefits
formula. This supplement never materi- minutes using microscopy. Weins admit- for disaster assistance. The ASCS had
alized because of inconsistencies. Some ted that the ingredients were readily contended that the potato losses were not
time later, Van Liere’s company began available in the market and that they the result of the weather conditions in
manufacturing its own supplement, and were common knowledge. 1992, but rather were caused by deci-
by 1989 Van Liere had a marketable Secrecy is fundamental to the exist- sions the producer made.
product. In August 1991, Sporleder filed ence of a trade secret. Pioneer Hi-Bred After losing both his appeal to the
a complaint against Van Liere and his Int’l v. Holden Found Seeds Inc., 35 F.3d State Committee and to the National
company claiming, inter alia, breach of 1226 (8th Cir. 1994). Reasonable precau- Appeals Division, Mr. Irwin sought judi-
fiduciary duty and fraud and deceit. In tions must be taken, including internal cial review of the agency decision. Be-
September 1991 Weins and Meyer filed a and external security, confidentiality cause the administrative record was in-
claim for trade secret violation against agreements, and keeping information adequate, the agency sought and obtained
Van Liere and his company and a con- under lock and key. Weins failed to dem- a remand of the appeal to the agency.
tract action against Sporleder. Their com- onstrate that active measures were taken Mr. Irwin then again unsuccessfully
plaint was later amended to add various to insure secrecy. He discussed the prod- appealed the decision through the Na-
tort claims. These actions were consoli- uct with several companies, no confiden- tional Appeals Division process and
dated for trial. tiality agreements were signed, and the sought review of the administrative deci-
In the Sporleder v. Van Liere action, product testing sites were left unsecured. sion in federal district court. In 1999, the
the jury awarded Sporleder $420,000 in Furthermore, there was no evidence that federal district court ruled that the pro-
compensatory and punitive damages. In proved the product ultimately mixed by ducer was entitled to the requested ben-
the Weins and Meyer v. Sporleder and Van Liere and Sporleder was the same as efits.
Van Liere action, The jury awarded Weins Weins’. After unsuccessful attempts to resolve
and Meyer $640,000 including punitive The South Dakota Supreme Court held the amount due, Mr. Irwin sought attor-
damages. The trial court then determined that no trade secret existed and reversed ney fees and costs under the EAJA, as
that the tort claims (including punitive the trial court’s decision and remanded well as judgment for the underlying ben-
damages) were displaced by South for a consistent judgment. On remand, efit amount and interest. In March 2000,
Dakota’s Trade Secret Act, so the puni- the trial court rendered an amended judg- Judge Robert H. Cleland ruled that Mr.
tive damages were struck. All parties ment reinstating the award of $640,000 Irwin was entitled to all requested attor-
appealed, and the South Dakota Supreme (including the punitive damages) in favor ney fees and costs, as well as benefits in
Court was presented with the question of of Weins and Meyer. This award was the amount of $65,583.06.
whether Weins had a valid trade secret. based on Weins’ and Meyer’s tort claims In defending against the EAJA claim,
The court recognized that the exist- as opposed to the Trade Secret Act claims. the agency argued unsuccessfully that
ence of a trade secret is a mixed question The trial court found that since there was the NAD, as it existed at the time of its
of fact and law. The law question per- no trade secret, the damages found by the decision, was not engaged in “adjudica-
tains to the South Dakota statute S.D. jury based on the tort causes of action tion” under section 554 of the Adminis-
Codified Laws section 37-29, which is a were not displaced by the Trade Secret trative Procedures Act (“APA”). The court,
substantial adoption of the Uniform Trade Act. Van Liere appealed the trial court’s following Lane v. U.S. Department of
Secrets Act. The first part of the statute amended judgment. Agriculture, 120 F.3d 106, 108-109 (8th
defines a trade secret as “information, The supreme court then had to con- Cir. 1997), ruled that the NAD hearing
including a formula, pattern, compila- sider whether the amended judgment
Cont. on page 7

NOVEMBER 2000 AGRICULTURAL LAW UPDATE 3
Neew
w wwater re
ater quality r raise
egulations r EPA
aise questions about EPA
influence
inf luence oover agr
ver ag icultural
ricultur practices
al practices
By Anne Hazlett and Barclay R. Rogers

Citizens groups, environmental interests, charge will not violate state water qual- cultural, industrial, and environmental
and various governments have been tout- ity standards. 33 U.S.C. §§ 1342(a), interests. While its members were able
ing total maximum daily loads (“TMDLs”) 1311(b)(1)(A), 1312. to achieve considerable agreement on a
in recent months as the solution to im- While the major thrust of the Clean number of important issues, the Com-
proving water quality in the nation’s Water Act is a performance standards mittee split on the question of how the
rivers, lakes, and other navigable wa- approach designed to control point TMDL process should be used to address
ters. In responding to the recent atten- sources, Congress also included an ambi- nonpoint source pollution. Houck, T M D L s
tion directed toward TMDL development, ent water-quality based system appli- III at 10422.
EPA promulgated revisions to its water cable to both point and nonpoint sources. After receiving the FACA Committee’s
quality planning and management regu- Such a scheme was developed at the recommendations, EPA proceeded with
lation, 7 C.F.R. parts 122-24 and 130. behest of the states that vehemently main- its notice and comment rule-making pro-
Issued on July 13, 2000, these amend- tained that they could implement water- cess to revise the existing TMDL regula-
ments revise and clarify the agency’s quality based regulation if only the fed- tions. See Revisions to the Water Quality
regulatory requirements for establishing eral government would allow them. Oliver Planning and Management Regulation
TMDLs under § 303(d) of the Clean Wa- A. Houck, TMDLs IV: The Final Frontier, and Revisions to the National Pollutant
ter Act. Given the scope of this program, 2 Envt. L. Rep. 10469 (1999). This system Discharge Elimination System Programs
these rules raise important questions is embodied in § 303(d) of the Act, which in Support of Revisions to the Water
about how it will be used to control water requires states to identify “those waters Quality and Planning Management Regu-
pollution attributed to agricultural ac- within their boundaries for which efflu- lation, 65 Fed. Reg. 43585 (2000). In
tivities. ent limitations required by section contrast to the FACA Committee mem-
1311(b)(1)(A) and section 1311(b)(1)(B) bers who were unable to reach a consen-
Historical development of the are not stringent enough to implement sus regarding the relationship between
TMDL program any water quality standard applicable to TMDLs and nonpoint source control mea-
In 1972, Congress enacted the modern such waters.” 33 U.S.C. § 1313(d)(1)(A). sures, EPA expressly stated that nonpoint
water pollution control statute that is Once identified, the states are required sources were included in the TMDL pro-
commonly known, together with its sub- to prepare a total maximum daily load cess. Id. at 43588. More specifically, the
sequent amendments, as the Clean Wa- for each of these waters. Until recently, agency provided that the requirement for
ter Act. The stated objective of this legis- neither the states nor EPA aggressively states to identify and establish TMDLs
lation is “to restore and maintain the pursued programs under this provision. for impaired waterbodies exists even
chemical, physical and biological integ- Such complacence led Professor Houck to where the waterbody is impaired solely
rity of the Nation’s waters.” 33 U.S.C. § describe the behavior of the states and by nonpoint source pollution. Id. (citing
1251(a). In order to achieve this objec- EPA as a “joint venture in nonperfor- Pronsolino v. Marcus, 91 F.Supp.2d 1337
tive, Congress also declared that it is mance.” Oliver A. Houck, TMDLs III: A (N.D. Cal. 2000)).
national policy that “programs for the New Framework for the Clean Water Act’s The revised rules have generated a
control of nonpoint sources of pollution Ambient Standards Program, 28 Envt. L. substantial amount of controversy in large
be developed and implemented in an Rep. 10415, 10416 (1998) (hereinafter part because of the agency’s position on
expeditious manner so as to enable the Houck, TMDLs III) . the treatment of nonpoint sources.
goals of this chapter to be met through Starting in the early 1990s and still Through an appropriations rider, Con-
the control of both point and nonpoint continuing today, citizens groups began gress has ultimately prohibited EPA from
sources of pollution.” 33 U.S.C. § filing lawsuits against the agency in or- spending any fiscal year 2000 or 2001
1251(a)(7). der to force the implementation of § funds to implement the rule. Moreover,
The regulatory framework designed to 303(d). Id. at 10416-17. Such suits were the Administration has designated the
ensure that these goals are met reflects a motivated, at least in part, by the belief revised regulations as a “major rule.” As
dichotomy in control strategies. For point that the TMDL process was a viable such, the revisions are subject to congres-
sources, which are defined as discrete means of addressing the issue of nonpoint sional scrutiny under the Congressional
conveyances such as pipes and ditches, § source pollution. See Consent Decree, Review Act, 5 U.S.C. §§ 801 et seq. At
301(a) prohibits any discharge into the Pacific Coast Federation of Fishermen’s present, resolutions to disapprove the
nation’s waters without a permit issued Associations v. Marcus, et al., No. 95- rule have been introduced in both the
under the National Pollution Discharge 4474 MHP (Mar. 6, 1997). To date, EPA House and Senate by Rep. Marion Berry
Elimination System (“NPDES”). 33 has entered consent decrees in eighteen (D-AR) and Senator Mike Crapo (R-ID).
U.S.C. § 1311(a). Such permit may be states and faces impending litigation in H.J. Res. 105, 106th Cong. (2000); S. J.
issued only when the point source meets eleven other states relating to TMDLs. Res. 50, 106th Cong. (2000).
certain technological standards and the EPA, TMDL Litigation by State, http://
permit applicant verifies that the dis- www.epa.gov/OWOW/tmdl/ Specific provisions of the revised
lawsuit1.html (last visited November 7, regulations
2000). Several provisions in the revised TMDL
Anne Hazlett is a graduate student in the In the face of persistent citizen suits regulations could have a notable impact
Agricultural Law LL.M. program at the and inconsistent court orders, EPA con- on agriculture in light of their focus on
University of Arkansas. vened a committee in 1996 under the nonpoint sources of pollution. Taken to-
Barclay R. Rogers is a graduate student Federal Advisory Committee Act gether, these provisions raise significant
in the Agricultural Law LL.M. program (“FACA”) to address the TMDL issue questions about EPA’s authority to ad-
at the University of Arkansas. directly. The FACA Committee was com- dress water quality degradation attrib-
posed of diverse groups including agri- uted to agricultural activities.

4 AGRICULTURAL LAW UPDATE NOVEMBER 2000
Marcus, the most recent decision ad- For waterbodies impaired only by
Definition of a TMDL dressing the TMDL issue, the district nonpoint sources, as would be the case on
Prior to the revision, part 130.2(i) de- court described the concept of a TMDL as many waterways impaired predomi-
fined a TMDL as “the sum of the indi- a piece of “engineering data” designed to nantly by agricultural runoff, the demon-
vidual [waste load allocations] for point assist states in implementing its water stration of reasonable assurance must
sources and [load allocations] for nonpoint quality standards. 91 F.Supp.2d at 1355. show that management measures or other
sources and natural background.” Under Specifically, the court stated: “To assist control actions to implement the alloca-
the revised regulation, the TMDL defini- the states in gathering information, the tions contained in the TMDL meet the
tion is expanded from a mathematical statutory role of the TMDL was to iden- following four-part test: (1) “they specifi-
calculation to a “written quantitative plan tify the load necessary, as a matter of cally apply to the pollutant(s) and the
and analysis for attaining and maintain- engineering, to implement the water- waterbody for which the TMDL is estab-
ing water quality standards in all sea- quality standards. Without such engi- lished,” (2) “they will be implemented as
sons for a specific waterbody and pollut- neering data, states would be left to expeditiously as practicable,” (3) “they
ant.” 65 Fed. Reg. at 43662. Part 130.2(h) guess what needs to be done to meet will be accomplished through reliable
specifies that a TMDL include the follow- those standards.” Id. and effective delivery mechanisms,” and
ing eleven elements: “(1) the name and In the preamble to its final rule, EPA (4) “they will be supported by adequate
geographic location of the impaired noted that several comments received in funding.” 65 Fed. Reg. at 43663 (to be
waterbody, (2) identification of the pol- response to the proposed changes “inter- codified at 40 C.F.R. § 130.2(p)). In addi-
lutant and the applicable water quality preted the proposed definition as going tion, the regulations provide that the
standard, (3) quantification of the pollut- beyond the statutory concept of a TMDL TMDL must include an implementation
ant load that may be present in the as simply a calculation of the total load plan that in turn includes “a description
waterbody and still ensure attainment necessary to attain and maintain water of specific regulatory or voluntary ac-
and maintenance of water quality stan- quality standards.” 65 Fed. Reg. at 43596. tions, including management measures
dards, (4) quantification of the amount or In response, the agency maintained that or other controls, by Federal, state or
degree by which the current pollutant its revised definition is consistent with local governments, authorized tribes or
load in the waterbody, including the pol- the implementation language of § 303(d) other individuals that provide reason-
lutant load from upstream sources that because the additional elements in the able assurance, consistent with §
is being accounted for as background final rule definition specify in appropri- 130.2(p).” 65 Fed. Reg. at 43668 (to be
loading, deviates from the pollutant load ate detail the information that the agency codified at 40 C.F.R. § 130.32(c)(2)(ii)).
needed to attain and maintain water considers necessary to quantify loadings Two principal issues arise from these
quality standards, (5) identification of and to determine whether the loadings, requirements. First, the definition of rea-
source categories, source subcategories once implemented, would result in at- sonable assurance raises the question of
or individual sources of the pollutant, (6) tainment of water quality standards in whether EPA will, in reality, be forcing
wasteload allocations, (7) load alloca- the waterbody. Id. And, with respect to states to adopt regulatory controls for
tions, (8) a margin of safety, (9) consider- the specific requirement of reasonable nonpoint sources. Although limited regu-
ation of seasonal variations, (10) allow- assurance, the agency also stated that latory authority exists in most states to
ance for reasonably foreseeable increases without a demonstration of reasonable control nonpoint source pollution, such
in pollutant loads including future assurance that the TMDL will in fact be control is generally sought through par-
growth, and (11) an implementation implemented by the states, the alloca- ticipation in various voluntary programs.
plan.” Id. An implementation plan is tions presented in a TMDL “lack a neces- Are these incentive-based measures suf-
required “to provide a description, in a sary link to anticipated attainment of ficient to demonstrate reasonable assur-
level of detail appropriate to the circum- water quality standards.” Id. at 43598. ance?
stances, of actions necessary to imple- Whether the agency is in fact correct in In its preamble to the final rule, EPA
ment the TMDL so that the waterbody its assertion is important for two princi- states that the test of reasonable assur-
attains and maintains water quality stan- pal reasons. First, in the event that a ance is not met simply by having incen-
dards.” 65 Fed. Reg. at 43668 (to be TMDL does not meet all of the required tive-based programs or other voluntary
codified at 40 C.F.R. § 130.32(c)). Addi- elements, EPA is required under § measures designed to address water pol-
tionally, TMDLs must provide “reason- 303(d)(2) of the statute and § 130.34 of lution. 65 Fed. Reg. at 43600. Rather,
able assurance” that load allocations will the new regulations to establish a TMDL EPA will review the TMDL information
be implemented. 65 Fed. Reg. at 43668 on behalf of the state. Once the agency to determine whether the program meets
(to be codified at 40 C.F.R. § 130.32(c)(2)). develops its plan, the state must incorpo- the four-part test described above and
Certainly, this revision marks a clear rate this TMDL into its water quality whether there is a good track record of
departure from the concept of a TMDL as management plan under § 303(e). 65 success. Id. If a state has failed to fully
a mere water-quality engineering calcu- Fed. Reg. at 43669. Second, the expanded develop or to verify the success of volun-
lation to a plan that requires the states to concept of a TMDL will arguably impose tary programs, the agency’s stance on
show that measures will be implemented a significant burden on states in terms of reasonable assurance arguably may force,
to ensure that water quality standards the resources required to develop a plan or at the very least coerce, a state to adopt
will be achieved. Thus, a key question for submission to the agency and the risk regulatory controls on nonpoint sources
arises as to whether this conceptual shift that the established plan will be chal- in order to make its TMDLs approvable.
is authorized under the Clean Water Act. lenged by private interests as insuffi- In responding to this concern from
Interestingly, a TMDL is not defined cient to meet each of these detailed re- commenters, EPA simply stated that it
anywhere in the Act. But, in imposing a quirements. believes that it has the authority to re-
requirement on states to establish a quire the demonstration of reasonable
TMDL for waters that are identified as Demonstration of reasonable assurance assurance as part of an implementation
impaired, the statute refers to TMDLs as Under the revised regulation, the defi- plan under § 303(d) because this element
a “calculation” and a “load” that states nition of a TMDL includes a new concept is necessary to ensure that water quality
are then directed to incorporate into their of “reasonable assurance” that the allo- standards are met. 65 Fed. Reg. at 43598.
continuing planning process. See 33 cations reflected in the TMDL will be Second, an issue arises concerning
U.S.C. §§ 1313(d)(1)(C), 1313(d)(2), implemented. 65 Fed. Reg. at 43668 (to EPA’s authority to provide reasonable
1313(e). Moreover, in Pronsolino v. be codified at 40 C.F.R. § 130.32(c)(2)). assurance in situations when it estab-

Continued on p. 6

NOVEMBER 2000 AGRICULTURAL LAW UPDATE 5
TMDLS/Continued from page 5
lishes a TMDL for nonpoint sources. As any, baseline research to distinguish powerful.
previously stated, both the Act and the nonpoint source pollution from back- However, a recent piece of proposed
revised regulations require EPA to es- ground sources. When applied in the legislation may shed some light on the
tablish a TMDL on behalf of a state if it midst of such uncertainty, the definite future of the TMDL program. The Water
disapproves the plan submitted or if a TMDL requirements coupled with the Pollution Program Enhancement Act of
state fails to make “substantial progress” specified time limit may pressure state 2000 (S. 2417), sponsored by Senators
in establishing the TMDL. 33 U.S.C. § water quality agencies to default to pro- Mike Crapo (R-ID) and Bob Smith (R-
1313(d)(2); 65 Fed. Reg. at 43669 (to be tectionist policies and implement load NH), calls for a report by the National
codified at 40 C.F.R. § 130.35(a)(2)). reductions that may not be wholly sup- Academy of Sciences to analyze the sci-
Substantial progress is defined as “es- ported in science. Further, these ambi- entific basis for the TMDL program.
tablishing a TMDL not later than the end tions may be unattainable in practice Water Pollution: Senate Approves Legis-
of the one-year period during which it and, yet, enforceable by private inter- lation Calling for Two TMDL Studies,
was scheduled to be established.” 65 Fed. ests. More Clean Water Act Funds, National
Reg. at 43669 (to be codified at 40 C.F.R. Environment Daily (BNA), October 13,
§ 130.35(a)(2)). Answers to looming uncertainty 2000. In addition, the bill directs the
Assuming that EPA must prepare As the new TMDL regulations increase National Academy of Public Administra-
TMDLs that are consistent with its own the potential for regulatory control over tion to look at the costs of the TMDL
regulations, the four-part reasonable as- nonpoint pollution sources, what steps, if program and the program’s effectiveness.
surance test requires the agency to in- any, should agriculture take to shape its Id. The bill passed the Senate by unani-
clude an implementation plan that con- own destiny? Perhaps the answers to this mous consent on October 10, 2000. Id. A
tains, at the very least, a description of question of policy can be viewed as a companion measure, H.R. 4502, has been
the management measures and controls continuum. At one end, agriculture could introduced in the House by House Agri-
to be employed to achieve the load alloca- lobby Congress to amend the Clean Wa- culture Committee Chairman Larry
tions. 65 Fed. Reg. at 43668 (to be codi- ter Act to exclude nonpoint sources from Combest (R-TX) and Rep. Charlie
fied at 40 C.F.R. § 130.32(c)(2)(ii)). Satis- the TMDL process. At the other end, Stenholm (D-TX), the panel’s ranking
fying this requirement is problematic. agriculture could adopt a proactive re- member. Id. The bill was the subject of a
Regulation over land use practices is sponse by implementing its own pro- June hearing in the House Agriculture
generally essential to the control and grams designed to reduce nonpoint source Committee. Id. Should the bill pass, the
ultimate reduction of nonpoint source pollution in the upcoming farm bill. And, directed studies may arm agriculture
pollution. Yet, EPA readily concedes that somewhere in the middle, agriculture with some objective, statistical evidence
land use decisions are the exclusive prov- could challenge the new regulations. about the cost, burden, and relative effi-
ince of the state. See Pronsolino, 91 ciency of the TMDL process as a means of
F.Supp.2d at 1355 (“Congress did Amend the statute addressing pollution resulting from agri-
not...authorize EPA to regulate state land- In the recent Pronsolino decision, the cultural activities. Whether or not such
use practices. The Court agrees. EPA court concluded that Congress intended information would ultimately lead to a
agrees.”). Without the authority to regu- the TMDL process to apply to nonpoint statutory amendment, the results of these
late state land use practices, it is cer- sources, even in the context of a river that studies will arguably contribute to the
tainly questionable whether EPA can was impaired solely by timber and agri- debate concerning nonpoint source pollu-
“reasonably assure” that its TMDL will cultural runoff. Nevertheless, much of tion control and the TMDL program.
achieve the intended load allocations and, the dispute underlying this litigation as
hence, whether it can comply with its well as the general controversy over the Challenging the regulations
own regulations. amended regulations arguably have Just five days after the final rule was
arisen from the fact that the TMDL pro- published in the Federal Register, the
Timeframe for establishment gram, when applied in reality, may have American Farm Bureau Foundation
Under the old regulations, the agency difficulty addressing the intricacies of (“Farm Bureau”) was the first of several
imposed no deadline on the states for nonpoint source pollution control such as groups to file a petition in the U.S. Court
establishment of a TMDL once a water weather, large numbers of potential con- of Appeals for the District of Columbia to
was listed as impaired under § 303(d). tributors, contributions from natural challenge the amended regulations.
However, § 130.28(b)(2) of the new regu- events, and lack of precision in discern- Water Pollution: Farm Bureau Asks U.S.
lations requires states to schedule estab- ing exact amounts. Thus, the central Appeals Court to Review Final Rule on
lishment of TMDLs “no later than 10 question remains: Did Congress really Impaired Waters, National Environment
years from July 10, 2000, if the waterbody intend for the TMDL process to apply to Daily (BNA), July 21, 2000 (American
and pollutant was listed on the part of nonpoint source contributors? Farm Bureau Federation v. Browner, D.C.
the list before that date or 10 years from In seeking a favorable legislative re- Cir., No. 00-1320). In a statement of
the due date of the first subsequent list sponse to this question, agriculture would issues filed with the court on August 21,
after July 10, 2000 on which the face a stiff battle in light of several fac- 2000, Farm Bureau stated that it is chal-
waterbody and pollutant is initially in- tors. First, support for any amendment lenging EPA’s authority to list waters as
cluded.” 65 Fed. Reg. at 43666. Given the to the statute in this regard would be impaired and require a TMDL to be de-
reported complexity of TMDL develop- labeled by many as a “dirty water vote.” veloped if the sources of the impairment
ment, the impact of such a time limit Second, the chief proponents of including are nonpoint runoff, groundwater, atmo-
could be arduous. nonpoint sources in the TMDL process as spheric deposition, or solar input. Id. In
In many situations, there is little moni- well as the amended regulations are in- addition, Farm Bureau is questioning
tored data from which to track nonpoint dustry and municipalities who, as point whether the agency can place waters
source pollution impairments. Further- sources, will continue to bear the ex- impaired by “pollution,” not specific pol-
more, with respect to what monitored traordinary burden and costs of addi- lutants, on the § 303(d) list; whether the
data does exist, regulators face signifi- tional discharge reductions if nonpoint concept of a TMDL can include an imple-
cant challenges in developing a realistic sources are not controlled. These groups mentation plan; and whether the require-
pollution load because there is little, if historically are well-funded or politically ment of reasonable assurance is autho-
rized under the statute. Id. The National

6 AGRICULTURAL LAW UPDATE NOVEMBER 2000
TMDLS/Continued from page 5 farm bill has begun and will soon inten-
Corn Growers Association and National sify. While at this juncture it is difficult Oops! W h y did wwe
e
Chicken Council have also filed similar to determine the precise direction that
petitions. Id. (National Corn Growers this legislation will take, conservation create
cr we
eate a w eb site?
Association and National Chicken Coun- measures have been an important com- Everybody’s doing it—creating a web site.
cil v. EPA, D.C. Cir., No. 00-1384). In an ponent of previous bills in recent years. Why not? It is a way to add exposure to
August 1, 2000 statement, George Watts, Accordingly, policymakers and agricul- one’s business or to tell about yourself
president of the Chicken Council, stated: tural interests might consider the extent and provide a method for persons to
“EPA has gone beyond its legal authority to which agriculture could satisfy the contact you.
in attempting to pull farms into the TMDL TMDL requirements by conditioning farm All of that is well and good, but there
programs.” Id. program payments on the adoption of are some potential legal exposures in
In response to these petitions, numer- certain land management practices de- creating and maintaining a web site.
ous environmental advocacy groups have signed to reduce nonpoint source pollu- A web site name is a trademark. If one
filed motions to intervene on the agency’s tion and to ultimately achieve water qual- uses a web site name that is the same as
behalf. Id. (American Forest and Paper ity standards. For example, lawmakers a well-known name used by another
Association v. EPA, D.C. Cir., No. 00- could require farmers to demonstrate person, one may be facing a trademark
1353). Some of these organizations in- reasonable assurance that the load allo- violation or a charge of trademark dilu-
clude Earthjustice Legal Defense Fund, cations will be met by conditioning the tion from the other person. Neither com-
Sierra Club, Water Keeper Alliance, receipt of benefits on the preparation of a petition nor a likelihood of confusion is
Northwest Environmental Advocates, the site-specific farm conservation plan. Al- necessary to support a claim of trade-
Center for Marine Conservation, Coast though similar suggestions have met mark infringement.
Action Group, Lake Michigan Federa- great resistance from farmers in the past, While courts seem to be heading both
tion, National Wildlife Federation, South- countervailing concerns arising from the ways, for a business with a web site on
ern Environmental Law Center, and uncertainties associated with the free- the Internet, it has been found that the
Trout Unlimited. Id. In seeking interven- dom to farm construct as well as the fact the web site can be accessed from
tion, these groups are challenging the threat of direct regulation may render another state may constitute sufficient
petitioners’ assertions that EPA exceeded this policy scheme more palatable. connection with that state to allow the
its authority in its revisions to the TMDL person whose web site is accessed to be
program. Id. Conclusion subject to suit in the other state. In this
Without question, the new TMDL regu- connection, an interactive web site is far
Proactive compliance lations are an attempt by EPA to address more likely to have this result imposed
While certain alternatives have re- the problem of nonpoint source pollution on the web site owner than is a web site
ceived much consideration, little atten- head on. In applying this directive to that only passively displays information.
tion has been drawn to yet a third option: agriculture, some have labeled the initia- Web sites can include links to other
proactive compliance. Clearly, the amend- tive as “direct war on the farmer.” Houck, sites. “Metatags” (the hidden language
ments raise many questions over which TMDLs III at 10424 (quoting Linda Korn search engines use to search the web)
to do battle. But, as with any fight, it is Levy, Louisiana Department of Environ- may be provided to assist customers to
worth considering the purpose and aim mental Quality, Tulane Law School find a company. If permission has not
of the battle. Are the clean water goals of (March 10, 1998)). In light of the poten- been obtained for the linking of another
the amended regulations and viable agri- tial impact of the new regulations on the site to your site and use of the other
culture mutually exclusive? Possibly not. industry, farm advocates must address person’s name in your metatag, you could
As previously stated, the new regula- the critical question of how agriculture be “looking for” litigation.
tions require states to demonstrate rea- will respond. Use of materials on a web site can
sonable assurance that the load alloca- result in copyright violations. Even if you
tions will be met. To meet this require- have permission of a manufacturer to use
ment for a waterbody impaired solely by a photograph of a particular item on your
nonpoint sources, the states must show MICHIGAN/Continued from page 3 web site, you may also need the permis-
that the management measures con- was an adjudication, whether under the sion of the photographer who took the
tained in the TMDL: (1) apply specifi- NAD statute in effect earlier or cur- picture and who may have only licensed
cally to the pollutant(s) and to the rently. its use to the manufacturer for the
waterbody for which the TMDL is being The agency also argued that its posi- manufacturer’s catalogue purposes and
established, (2) be implemented expedi- tion was “substantially justified” and that not for further distribution. This can also
tiously, (3) be accomplished through reli- no fees should be awarded. Finding the apply to professional models who have
able and effective delivery mechanisms, agency’s position “muddled” and nearly not consented for their photographs to be
and (4) be supported by adequate water “incomprehensible,” the court disagreed distributed generally.
quality funding. But nowhere in these with the agency. The court stated that Unfortunately, just as almost anything
requirements does EPA dictate the pre- even after a remand to clarify the admin- seems to be today, putting up a web site
cise means by which the desired load istrative record, there was “evidence of may not be as simple as it seems and this
allocations must be implemented. In- the absence of substantial justification.” does not refer to technology. The preced-
deed, a plausible reading of this defini- The court noted that substantial justi- ing examples only touch some of the legal
tion suggests that the agency has left fication “can more easily be detected in a aspects of web site creation. As with
identification and selection of these case presenting a close call, such as one many things today, it may require sound
mechanisms to the states. favoring the plaintiff for technical rea- professional advice before the web site is
If this reading is correct, there is a sons; or a case where there are sound placed on the web.
significant opportunity for agriculture to arguments on each side, with the stron- —James B. Dean, Denver, CO
ward off future command-and-control ger one belonging to the plaintiff.”
regulation by developing policies that —Henry L. Knier, Jr., Lambert,
will reduce the environmental impacts of Leser, Cook, Giunta & Smith, P.C.,
its activities. Consider the timing of such Bay City, MI
a challenge: The debate over the next

NOVEMBER 2000 AGRICULTURAL LAW UPDATE 7