by Suzanne Bush
This has been a busy legislative year for Pennsylvania's equine industry. From the Pennsylvania Racehorse and Gaming Development Act which opens the state's racetracks to slot machines, to the resurgence of interest in Equine Liability Reform, to the State Conservation Commission's proposals for new regulations governing horse manure, horses were in the news and on the minds of our legislators.
Smarty Jones was Pennsylvania's most famous farm product in 2004, but it was the nutrients produced by Smarty and his fellow equines that got the attention of the State Conservation Commission. Douglas Goodlander, Director of Nutrient Management at the Commission said that the 1993 law governing how animal waste is handled on Pennsylvania farms didn't apply to horses. In August, 2004 the Commission proposed regulations that would force horse farms to comply with the 1993 law, called the Nutrient Management Act. The regulations, which were available for public comment until November 5, will apply to horse farms that meet two specific criteria:
In the regulations' current language, farms meeting both these criteria will have two years after the date the regulations are approved in order to come into compliance. "We heard from 214 different commentators, voicing all different sides of the issues," Goodlander said. He said that the Commission will review the comments over the next six months and redraft the proposals by early summer. The revisions will address concerns about timing, and about retro-fitting existing farms versus less complicated implementation of regulations for new operations.
The proposed regulations generated a lot of controversy because they would require operators of high density farms to develop explicit technical plans for manure management, and because the farm operators would need to hire certified nutrient management specialists in order to complete their plans. "In its current form, people felt it would be too great a hardship, particularly for existing operations," Goodlander said.
He said that the regulations may have different timetables, depending on the status of the operation. "There may be an interim standard," that would allow farm operators to achieve compliance over several years, instead of just two years.
"There will probably not be any further public comment opportunity after the regulations are revised," he said. "However, the issues will hit the airwaves as we go. There will be opportunities for back and forth with the regulated community, through public meetings and hearings."
Even as the process goes forward, Goodlander understands that it will remain somewhat controversial. "There are two extreme sides on this issue. It's the Commission's role to find the right balance. We need to be sensitive in how we move ahead. I'm thrilled with our Commission members—they're real people out there dealing with the issues. We can't turn away from the environmental issues. There are ways to address them without shutting the industry down." He said that the regulations represent both good and bad news for the state's equine industry.
"The horse industry is a large and growing component of Pennsylvania's farm industry. There are scientific issues such as environmental damage to streams and our water supply. These can be documented, and we cannot ignore them."
While the horizon may look somewhat cloudy for farm owners who are likely to face the need to develop nutrient management plans, it is very bleak for all farm owners who have been struggling to pay for liability insurance. Senator Mike Waugh (R., York County) and Rep. Fred McIlhattan (R., Armstrong and Clarion Counties) have introduced bills that would reform the state's equine liability laws. The reforms are critical to attracting more insurers and reducing costs for horse owners. Although neither bill made it out of committee this year, both did achieve more support this year than ever before. And both will be reintroduced in the next session.
Rob Hoffa, an attorney specializing in the equine industry, sees both sides of this issue. "Yes, we're in trouble because we don't have insurance. No, we're not in trouble because in Pennsylvania we still have the assumption of risk," he said. The conundrum is especially frustrating because both the trial lawyers and horse owners will benefit from the reform. The assumption of risk is a defense that presumes the injured party knew that a particular activity was dangerous, but chose to participate anyway. The assumption of risk defense evaporates where negligence is proved.
"We're losing insurance companies that insure horse operations because we don't have an EALA (Equine Activity Liability Act)," he said. But the trial lawyers who oppose the law would most likely benefit in the event of injuries. "Trial lawyers view it as an attempt to limit peoples' right to sue, but there are still going to be lawsuits. EALA gives the defense attorney the chance to get out of the case earlier through summary judgment." Pennsylvania's equine industry is being squeezed by two powerful forces in the insurance dilemma. Insurers' fears of catastrophic settlements in case of injuries cause a lack of competition, and the high cost and scarcity of liability insurance is the effect of that competitive void.
Hoffa recently spoke to a meeting of the Pennsylvania Equine Council in State College, and pointed out that much of the resistance to Equine Liability Reform comes from people who don't really understand the equine industry in general or horses in particular. He said that the trial lawyers have proposed an alternative to Waugh's and McIlhattan's bills, and their proposal represents a significant step forward from the stalemate that has plagued the issue for more than a decade. Even though the revisions in the trial lawyers' proposal need work, Hoffa said there's reason to be optimistic. The bill must be reintroduced in the next session, since it will not get out of committee this session, and both sponsors have plans to do so.
Another piece of legislation that will affect Pennsylvania's equine industry is HB 2801, sponsored by Rep. Arthur Hershey (R., Chester County). An amendment to the 1989 legislation that created the Agricultural Land Preservation Board, HB 2801 would expand the definition of Agricultural Security Areas to include commercial farms where horses are boarded and trained, and where people can take riding lessons. The original bill was an antidote to the massive losses of agricultural land in Pennsylvania during the 1980s and 1990s, when thousands of acres of prime farmland that once supported corn and soybean crops, or herds of dairy cattle, suddenly sprouted housing developments, office complexes and shopping malls.
As the state lost agricultural jobs along with land, the legislature used agricultural easements as defensive strategies. Farms that had been preserved continued to operate, and the owners could even sell the farms. But the easements would convey to every new owner. Farmers facing retirement, or relocation to other states faced dwindling prospects for selling their land. The combination of existing farmland and lots of acres of open space was attractive to people who wanted to operate boarding stables. But the rules forbade the transfer of agricultural easements to boarding stables.
"I hope this gets accepted," Hershey said. "It reported out of committee, but it's not on the calendar. The Senate wants to work on what they have, and this is not as important to them right now." He said that the bill will be reintroduced early in the next legislative session next year. Hershey said that he knows of no problems with the bill in the House, where it was unanimously approved by the Agriculture Committee on Oct. 19.
These legislative initiatives reflect the growing importance and profile of the equine industry in Pennsylvania, and they also speak volumes about the complexity of the industry. In October, when Pennsylvania Equine Council members met with legislators to help them understand the impact of the liability insurance crisis, it was clear that Smarty Jones was not the only horse making news in the state. And it was also clear that the legislature is eager to do what is necessary to preserve and protect this $10 billion equine industry.