Farm Legal Series #2: Poultry Pitfalls and Regulation
Welcome to the second episode in a series Barn2Door is launching in partnership with the Farm to Consumer Legal Defense Fund. FTCLDF is a non-profit organization of lawyers supporting Farmers across the country and helping them navigate the unique legal challenges Farmers face. In this episode, we focus on poultry regulations, how they vary across the country, and the resources FTCLDF has to help Farmers sell their poultry products direct-to-consumer.
-
James: 0:26
hey welcome everyone to the Direct Farm Podcast. We've got another great conversation for you today with the Farm to Consumer Legal Defense Fund. This is the second in this series of podcasts we're doing at the Farm to Consumer Legal Defense Fund to dive into the nuances and regulatory issues that might be facing different food products. For those of you have not heard of the Farm to Consumer Legal Defense Fund, they are a nonprofit organization. Made up of lawyers, serving farmers by protecting, defending, and broadening the rights and viability of independent farmers, artists, food producers, and their consumers in all 50 states. Today we're going to be diving in on poultry. Last week we talked with them about dairy. So you can go listen to that. If you're curious about dairy. Today I'm delighted to welcome back Alexia Kulak who is the Executive Director of the Farm to Consumer Legal Defense Fund. She's a licensed attorney in Illinois and Wisconsin, and she's practiced law for over 20 years. And her experience has inspired her interest in US Ag promoting small scale farmers and sustainable farmers while protecting the rights of independent producers across America. Welcome back, Alexia you ready to dive into poultry?
Alexia: 1:33
Sure. Thanks so much for having me back. I'm really excited be here.
James: 1:37
Well, that's awesome. So for the listeners who perhaps missed that first episode on dairy could you give a little bit of an overview again on the Farm to Consumer Legal Defense fund and again, how you arrived there and became the Executive Director today.
Alexia: 1:50
Right. Well, that's a lot. Thank you. So farm to consumer legal defense fund is again a nonprofit organization. We are providing legal representation to small producers, small farmers, small food artisan members. And it's just a whole host of the regulatory issues that small farms can face. The US food policy is really geared at larger producers, and what happens then is the small farm 10-20 acres is faced with regulations from federal agencies, state agencies, county agencies, public health departments, and it can get awfully overwhelming, awfully quickly. So we are providing direct legal services to those small farmers. As far as myself, I had first started looking at Ag policy and some labor issues on farms and quickly became much more interested in our food supply as a whole and on the need for regenerative ag and sustainable agriculture. And thought about where I could make a difference in this arena and decided to use my legal skills to do so. What I will say What I love about Farm to Consumer Legal Defense Fund is that we're one of the few organizations that I know of that are providing direct legal services to the small farms and producers. So there's folks out there helping with sustainable Ag methods, with farming methods, there's folks doing public interest litigation, but there's not a lot available for very small farmers who may not otherwise be able to afford legal representation. And so I'm just thrilled that we're able to provide that to these small producers. I think what we saw from COVID, really highlighted the vulnerability of our food system. And I think that a decentralized system where local producers can produce food, sell it directly to their communities, support their communities, and provide a healthy product is so important today. And we've just seen that during our last couple of years of experience.
James: 3:42
That's probably the one really bright spot that came out of the pandemic is that everybody wants to know where their food comes from and everybody buy local. We've already seen it with beer. I know everybody wants to buy the local microbrewery, and they're willing to pay a premium for that, but you know, why not be doing it for all the food that you put on your table every single day? And what do Americans eat a lot of, chicken. Let's get down to it. Let's dive into poultry, right? Because man, poultry, farmers talk about a, portion of society that is so under appreciated. You know, I think I was reading the other day that 71% of poultry farmers live below the poverty line. Cause it's just really difficult. Let's talk a little bit about like really kind of two segments of poultry farms, right? There's the people who grow broilers and there's the folks who have layers. When you think about those things, what are the one or two big legal issues? Let's start with the broilers, right? What has been like the one or two really big issues that people who are raising meat birds face when thinking about selling direct to market?
Alexia: 4:32
Yeah. So when selling, thinking about direct to market the big thing that comes up initially from the get go is the Federal Poultry Products Inspection Act. So very similar to meat inspection. The general rule is that you raise the birds and you would bring them to a federal or state inspection facility to be inspected prior to sale. And then what's interesting for our smaller producers though, is that there actually are some exemptions for the small producers. So under the USDA regulations and guidelines there's two different exemptions. One is up to 1,000 birds and the other is up to 20,000 birds. The reason being there's just a distinction between some of the requirements and record keeping that differentiate between the two. What gets complicated for a small producer similar to other areas of Ag law is each state can then decide whether they've adopted the federal experience. And then they can decide which of the federal exemptions and they can add further requirements. So in a lot of states, it may be the case that a small farm qualifies for the 20,000 bird exemption, which means by the way that they can produce and process on farm and sell the meat from their own birds on farm without having to take it to an inspection agency. So that may be true, but then some states might require registration. Some states might require a license, which requires some sort of inspector from the state department of Ag to check out your facilities. And there may be limits on where you can sell. So in some places just gonna be straight from the farm. Some places may allow for some kind of farmer's market sales or small retail sales, et cetera. But one really great thing for the small producer of poultry, as opposed to dairy and meat is that this exemption of up to 20,000 birds is actually pretty significant. And by being able to process on farm and sell directly on farm you know, these producers can really keep the profits. And you had mentioned how many of the poultry producers are under the poverty line. And a lot of that has to do with. The fact that they're controlled by the large corporate processing companies that dictate the terms, typically they're contractors and not employees. And typically they're pretty draconian terms, right? And so to get out of that and to maybe do sustainable growing and do poultry, that you can make a profit off of. Falling under one of the federal exemptions and just selling it yourself is definitely going to be a better way to go.
James: 7:05
I agree, a hundred percent. We, we actually just released a new ebook on this topic called From Poverty to Profit, How to Increase Your Poultry Margins. And the whole pole point of that, just like you said, it's like, Hey, take control of your business. Understand what the legal requirements are in your state. But like you said, 20,000 birds, you know, at $30, $35 a bird that's, that's a pretty healthy, gross income. And if you manage your expenses well, you can make a good living on that. So well above the poverty line. And we're delighted and fortunate at Barn2Door to support many of those fantastic farms who are having that kind of success, but it can seem daunting. It can seem like a little bit of a maze and myriad of regulations, like you said, Federal, State, et cetera. So if I'm a poultry farmer that's listening to this today, thinking about this idea of going direct to sell my meat birds, what types of resources do the farm to consumer Legal Defense Fund offer. I mean, can they go to your website? Is there like a matrix of like, give them an overview generally of what they can look at? How do they take advantage of what you have to offer?
Alexia: 7:59
Thank you. So, yeah, a couple of things on the public website, we do have a number of resources, one of which will detail what exemptions the state in which your producer, your lister, maybe working under, and then they can find out if their state allows for the 1,000 bird exemption or up to the 20,000 bird exemption. When somebody is very interested in going forward with that, to our members, we will walk them through and explain in much greater detail what the requirements are for the 1,000 bird and the 20,000 bird exemption. The 1,000 bird is fairly simple. In terms of you can raise, you do need to keep some records. So if there's a problem, they can trace it, sanitary conditions. But for the most part, it's pretty simple to meet the requirements under that exemption. 20,000 is a little bit more involved and we will certainly walk through with any member what's required again, it will be more record keeping. It might get more into methodology in that state as to how birds are processed. Some will allow open air processing, some will not. That kind of thing. And then we do have to really worry too about, even if you can process on farm, making sure that there's not another regulation to deal with in terms of selling directly from the farm. So are you zoned agricultural? Do you need some sort of commercial sales license? Those sorts of things can obviously get in the way as well. And we will help them through that regulatory process of applying and seeing what kinds of licenses and regulations in the particular state the member's going to need. So that we do for our members although the introductory information about poultry can certainly be found on our website.
James: 9:34
That's so awesome that you guys have assembled all this great resources available for farmers. And for those of you who, again, might feel a little bit like, this sounds overwhelming. It might sound daunting. The reality is I think you can join the farm to consumer legal defense fund for just $125 a year. And you can get consultative guidance and feedback from not only Alexia, but somebody on her team who is actually an expert and legally licensed in your state. Right. Cause those regulations are going to vary dramatically from state to state. And I can speak again from experience at Barn2Door, we have several poultry producers who have really taken advantage of this service. More importantly, have built thriving businesses selling direct. Just fantastic work by Alexia and the team there. Let's talk a little bit about layers, right. So instead of processing the meat birds, I know that probably is a little bit more heavy handed. What are your thoughts on, poultry producers who are just trying to get in and try to build out a good subscription business of eggs. I don't know about you, but I had eat good dozen eggs every week. And I'm fortunate I have some of my own urban chickens, although I I'm just below the legal limit in Seattle, I have to be below a certain amount of chickens I'm allowed to have in the city, where I'm zoned. But for those people who are thinking about building a business around subscriptions what are some of the things that to think about there?
Alexia: 10:45
So, again, unfortunately, and by the way, I don't mean to say there's so many different regulations to overwhelm folks. It's kind of my frustration in life, right. And that the policies don't take into account these small producers that can't necessarily afford, a huge laying production facility, for example nor did the consumers want their eggs to come from that kind of facility. So, we can certainly guide people through that. But what I will say is that as a general rule. The federal egg rule is pretty specific on some requirements as to how the birds are kept, what kind of sanitary conditions are in place? What temperature the eggs need to be kept at. And some other details, but it only applies to production of 3,000 or more laying hens at a time. So as far as our members are concerned, they're usually going to fall under that number. And then what happens like in a lot of the law laws that we deal with at Farm to Consumer Legal Defense Fund is looking at your state and local regulation in terms of what's required. So very often, the states changed the numbers. So it might be the number of eggs. It might be the number of hens but for the most part, states allow some number of ungraded, unlicensed eggs to be sold direct to the consumer for consumption. That may not be for restaurants. It may not be at your local farmer's markets. But a lot of states will allow some of that, right? So a certain amount can be sold to restaurants. A certain amount can be sold at the farmer's market, et cetera. There are going to be some requirements, usually governed by a local department of health in terms of transportation, in terms of the temperature in which it's kept. But it can certainly be done. So, you know, similar to anything else we would say, you know, join and we'll work with people in terms of what their state and local regulations are, and if they need any other information, there will certainly help them through that process.
James: 12:32
That is such great advice and great feedback. And for folks who are poultry farmers today and maybe you're under a big contract with some big growing operation. You, you understand like, Hey look, it can be really tough going when you're under someone else's thumb, that's the beauty of selling direct is you can take the business into your own hands. You can make your own decisions. You can set the price. And the great news is, people willing to pay a premium for that product. So for farms that are out there that are under one of these large contracts, whether it's a layer or, a meat bird for that matter. Cause I know many times they have pretty heavy handed requirements from a contractual standpoint around the growing conditions the facilities, et cetera. Can you help, you know, farmers who are in those types of contracts, take a look at those things, figure out ways to navigate how to get out of those or how to get around those things. If they want to start looking at selling direct or perhaps they have to set up a different business. But I imagine there's gotta be some way to get around things legally, while being compliant with whatever legal obligations that currently have. Is that something you guys offer there too?
Alexia: 13:30
Yeah. I mean, we will very often take a look at our members, contracts with some of these larger organizations and try to advise them their rights under those contracts. There's often some provisions in those contracts that I don't think would be enforcible and so if we can help a member to get out of the contract, we will. Perhaps There are certain things that have to be done for a certain period of time. A lot of times there's strict notice requirements. So we pay attention to the details as to how to someone can get out from under one of those contracts. And move into a business model that's going to work best for them. When it comes to that kind of a contract or establishing a different business model, we will certainly consult with our members. But we really are in the business of helping members through government regulatory process and the government regulations generally. And not, drafting say LLC documents business formation work. But we will certainly take a look and see, and we'll do consulting in that area.
James: 14:26
So, this is good news for any of our listeners out there today, who might feel like under our burden of debt under a heavy handed contract by one of the big growing operations. There's help out there. There are people out there like the Farm to Consumer Legal Defense Fund who want to help you find a pathway forward where you can again, take control into your own hands and build a business selling direct. I would really encourage everyone of our listeners, whether you're a grower, whether you're a consumer, whether you're thinking about starting a farm, to go and support the farm to consumer legal defense fund, they do incredible work across the country offering fantastic services to farmers and to be able to do so at a very cost-effective manner. Can you share with us Alexia, if I am a listener and I am thinking about the great work you guys are doing, where do I go? How do I sign up? How does it work if I'm a member?
Alexia: 15:14
If you are a member you know, well, first of all, our website FarmtoConsumer.org is how you can learn more and is one method that you can use to join. Another method would be to simply call our number, which is 703-208-FARM. Which is 703-208-3276. Once someone is a member, however, what happens is they can call that number. If they need a consult, they can email us through our contact forms on the website. Otherwise through their membership account with us. And what happens is they will quickly be contacted back if they don't reach someone right away. Although very often they will have someone answer the phone and be able to talk to them right away. And that person will take some intake and learn a little bit more about what their issues are. And then we will determine who should be best assigned to it. And they will hear from an attorney to help them with their issues.
James: 16:06
That's just fantastic. And if you're a consumer who wants to be able to buy food directly from a farm, but you can also go sign up with a consumer membership just so you can continue to support the great work that the farm to consumer legal defense fund does and offers to farmers around the country. One thing I also want to call out, at Barn2Door, we've also debuted a new program called connect and you can go to Barn2Door.com/resources learn more about the connect program, where you can talk to other farmers like you, who've actually made this transition to selling direct. And have built a thriving poultry business, controlling their prices and owning their customer relationships. So again, hats off to all the farmers out there who are doing so much hard work to feed our communities. And again, Alexia, thank you so much for taking the time out to speak with me and share the wisdom you have to offer and guidance and counsel you have to offer to all of these farms. To learn more about Barn2Door and other resources might be available. You can also go to Barn2Door.com/resources and stay tuned for the next Direct Farm Podcast where we'll get to interview Alexia on another farm product. So we can dive into more regulatory constraints and limitations and nuances and how you navigate those to build a direct to market business. Thank you everyone, and have a wonderful day.
Alexia: 17:16
Thank you so much. Appreciate it.