The Effect Of State Ag Regulations
By Anne Pyburn Craig
Farming has been a vital part of the Hudson Valley economy for generations, supplying food for the tri-state metro area and beyond. A lot of hungry people means a large market. But neighboring a vast population center also means development pressure that’s far more intense than what’s faced by less-populated regions, and around the turn of the last century farmland was vanishing at an alarming rate. Skinny profit margins and high taxes were making small farms less and less sustainable.
Fortunately, people took notice and studied the issues, concluding that there was enormous untapped potential. “The region will be stronger, wealthier, and healthier if farming remains and flourishes,” noted analysts from the nonprofit farming think tank Glynwood in “State of Agriculture 2010.” “The range of actions required to make this happen will call upon the skills, energy, resources, and resolve of us all—private individuals, nonprofits, business enterprises, and government agencies at all levels.”
The Marbletown-based Hudson Valley Farm Hub is in its fourth season, training farmers, researching sustainable cover crops, saving Native American heritage seeds, and partnering with a long list of organizations such as Glynwood, Cornell University and its extension arm, and the Hudson Valley Agribusiness Development Corporation—just three examples out of over three dozen. All of that interest and activity translates, to some extent, into lobbying power—and in recent years, state government has taken notice and responded with farmer-friendly legislative innovations.
The most noticeable changes have come about in the state’s efforts to boost the craft beverage sector. “Through Governor Cuomo’s leadership, the State has taken many steps to grow the craft beverage industry by introducing new legislation, modernizing outdated laws, and implementing robust promotional campaigns,” says Department of Agriculture spokesperson Lisa Koumijian. “Today, there are nearly 1,000 licensed breweries, wineries, distilleries, and cideries across the state, a 224 percent increase since 2011.”
One of the most influential pieces of legislation was the Craft New York Act, signed by Governor Cuomo in 2014. The law paved the way for significant growth in the state’s craft beverage industry by cutting burdensome requirements placed on producers and easing restrictions related to the marketing of craft products.
To a large extent, that ball got rolling right in the Ulster County town of Gardiner, at least as far as distilleries are concerned. “When my partner Brian Lee first started working on this, we were looking at the fact that so many farms were getting bought up by developers,” says Ralph Erenzo. “Apple farmers, for example, couldn’t compete with farmers in China or Peru or Washington state. They could sell only the perfect specimens as table apples; anything else had to go to the cideries at six cents a pound. Our goal was to increase that value. Then we started working with grains as well. We were looking at distilling as an agricultural operation whereas everyone else was looking at it as industrial. We needed state protection.”
Before Prohibition, Erenzo notes, nearly every farm had its own distillery up and running; trying to establish a distillery anytime in the last half of the 20th century meant a $65,000 licensing fee. Erenzo and Lee discovered a lesser-known change that had targeted small-batch producers in 2000, costing just $1,500, and opened Tuthilltown Spirits in 2003, then the only farm distillery in the state. Erenzo knew more needed to be done. The result of his efforts, the Farm Distillery Law of 2007, set the stage for expansion. The Craft New York Act followed in 2014, cutting more red tape and raising production caps. Between 2011 and 2016, the number of farm-based distilleries jumped from 10 to 107.
From the farmer’s point of view, the craft beverage boom is all about providing raw material, and state government has sought to ensure that farmers get their piece of the pie. The Farm Brewery Law, which took effect in 2013, establishes incentives for brewers using at least 20 percent New York hops and 20 percent of other local ingredients. In 2019, the requirement will become 60 percent, and in 2024, 90 percent.
Beyond the bottle
While almost anything grown in the ground can be fermented, there’s a lot more to the agricultural economy than booze. Koumijian says state authorities have been striving to improve other parts of the situation, such as land access for young and/or new farmers who face some of the toughest real estate prices in the nation. “The Department has established a Beginning Farmer Program, including a one-stop shop, to help new and prospective farmers overcome obstacles to entering the profession and launch a successful agricultural operation in New York. In addition, the Governor signed a law in July to establish a Young Farmer Advisory Board to identify issues relating to young and beginning farmers and to provide advice to the commissioner, the Governor, and relevant state agencies regarding the promotion of agriculture as a career path and the economic development of young and aspiring farmers.”
Part of the Beginning Farmer Program is a statewide “listening tour,” which hasn’t made it to the Hudson Valley yet. When it does, the governor may find he gets an earful. “I started Green Heron almost 40 years ago with $50,000, which seemed like a lot of money at the time,” says Ray Cullen, president of the Ulster County Farm Bureau’s board of directors. “I’m not sure I could do it with a million now. And it’s a business like any other; if you can’t pay your bills, you don’t get to play.”
The Farm Bureau offers proposals and policy statements on a regular basis, with varying results. “One thing that recently passed through the legislature was allowing a tax write-off for half the value of food that’s donated to food pantries,” says Cullen. “We’ll see whether that dies on the governor’s desk. And we would like to lower the number of acres you need for an agricultural exemption. That would give startups a boost. Right now it’s 10 acres and $10,000 in gross sales; we’d like it lowered to 7 acres and $5,000. With the New York City market and the right specialty crops, making a living on seven acres is do-able.”
Farmers would also like to see some relief from what they say are well-intended but sometimes problematic environmental regulations. “Nobody is advocating changing oil right into a stream,” says Cullen. “But you shouldn’t need two separate permits just to change a culvert pipe.”
Farmers, he says, sometimes take more of a bad rap than they deserve. “Most people don’t realize that the vast majority of herbicides are used on lawns, not farms,” he says. “People think ‘big ag’ is hurting animals and wrecking the environment, but 98 percent of New York farms are still family-owned—and farmers know you need to keep the land and the animals happy; it doesn’t work any other way.”
On the bright side, Cullen’s happy to see raw milk legal again. “That was a big debate,” he says. “We knew that if just one person got sick, there’d be a big outcry. There used to be a guy selling it on Old Kings Highway; containers had to be marked ‘Not for Human Consumption.’ Now it’s legal and there’s a farm in Marbletown selling it. I can’t believe we actually have a dairy back in Ulster County.”