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Study: Community impact of CAFOs a ‘mixed bag’

Janet Ayres Published on 30 June 2010

The expansion of confined animal feeding operations (CAFOs) is a controversial issue in many communities. Producers, residents and local decision-makers often clash over conflicting interests regarding new operations. Four researchers at Purdue University wanted to learn more about the nature of these local conflicts and the impacts of swine and dairy CAFOs on rural communities. The researchers went directly to the sources of information.

They conducted face-to-face interviews with 50 large swine and dairy CAFOs owners in central Indiana to learn more about them and their operations, collected tax records from the courthouse to analyze impacts on county budgets, examined environmental violations and interviewed public officials. What they found was that the impact of CAFOs in rural communities is a mixed bag.

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Roman Keeney, assistant professor in agricultural economics, analyzed data from the interviews with CAFO operators. The analysis revealed that, on average, CAFO operators tend to be younger and attain higher levels of formal education than the average farm operator in the U.S. Nearly all of the surveyed CAFO operators had been raised on a farm, while about one in three are employed off the farm in addition to their responsibilities to the CAFO.

CAFOs in the Indiana study area are large sales farms with median sales (in 2008) of around $1.5 million for swine operations and more than $10 million for dairy farms. One-half of the operations were organized as family corporations with the other half dispersed among different organizational structures (e.g., partnerships or proprietorships). CAFOs provide more rural employment opportunities with higher wages than other farm operation types. The average hourly wage for ordinary CAFO labor was $12.38, while management positions (compensated family and non-family) are paid at about twice this hourly rate.

Nearly all of the surveyed CAFO operators identified the proximity to residential areas as an important consideration in choosing the location for their facility. Over half of the operators perceived no significant local opposition when they obtained their local building permit and only 6 percent reported strong organized opposition. Eighty percent of the CAFO operators reported that since they have been established, their reception in the community has been all or mostly positive.

Another component of the study was analyzing the fiscal impact of CAFOs on county budgets. Elected officials are interested in the impact of development on county revenues and on the costs of county services. Professor Larry DeBoer analyzed the fiscal impact of 19 CAFO operations relative to Indiana’s tax structure. He found that swine and dairy CAFOs can have either positive or negative fiscal impacts depending upon the taxable assessed value, taxable income and the number of employees of the operation. Dairy CAFOs are much larger operations than swine operations and therefore have more taxable assessed value, more taxable income and more employees.

Most of the CAFOs in this study paid more in total taxes than they added to county government costs, but they also added less to county revenues than might be expected due to the limits in Indiana’s tax structure. Part of what CAFOs provide to a community is tax relief for other taxpayers. DeBoer concluded that operations with higher assessed values and higher taxable incomes per employee are more likely to have a positive fiscal impact and that these are characteristics that local decision- makers may want to look for in new developments.

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Enforcement actions for environmental violations from the Indiana Department of Environmental Management (IDEM) for the eight counties in the study were examined by Tamilee Nennich, assistant professor in Purdue’s Department of Animal Sciences. She gathered data for a 13-year time period for all livestock operations and found 39 recorded enforcement actions, 15 of which were from CAFOs. Of the 11 enforcement actions related to water quality, more than 70 percent were related to manure application. Fines assessed to the operations typically ranged between $5,000 and $10,000. To put the environmental violations from CAFO operations in perspective, more than 325 enforcement actions were issued to all types of sources including cities, churches, businesses, county parks and others during this 13-year time period. Approximately 12 percent of the total enforcement actions were related to animal agriculture; less than 1 percent of CAFO operations had an incident on a yearly basis.

County plan directors and highway engineers who are most involved with CAFOs at the local level were interviewed in all eight counties. I personally examined their responses. Plan directors perceived the level of conflict in the community over the siting of new CAFOs at about a “6” on a scale of “1” (very low conflict) to “10” (extremely high conflict). They felt it was very difficult to give a number, however, as it depended upon the specific owner and the specific location for the operation. Plan directors felt that the expansion of an existing operation was met with much less opposition than the siting of a new CAFO owned by outside interests because of the trust and relationships that were built with local people. Several plan directors commented on the bias against “outsiders.”

The conflict around the development of CAFOs has led the plan commissions in all eight study counties to re-examine and update their comprehensive land use plan and zoning ordinances. Counties with the most recently revised and adopted ordinances are using multiple agricultural districts to separate incompatible land uses from each other. They also use objective development standards that set forth conditions that must be met before a building permit is granted. Examples of these design standards include setback distances from residences, waterways, roads and other land uses; minimum lot size; use of buffers, shelterbelts and landscaping; use of anaerobic digester and other odor abatement technologies; direct access onto arterial or major collector roads; standards for driveways, parking turnaround and loading areas; and handling and disposal of dead animals. Some counties are considering a bonding requirement to cover expenses that may be incurred by the county if there is road damage or the operation ceases to exist and requires environmental cleanup. This bonding prerequisite would be similar to what is currently required of subdivision developers.

The county highway engineers indicated that the CAFOs in their respective counties did create road problems; however, none of them kept records on expenses incurred by the county except for a receipt for the clean-up of a manure spill in one county and the cost of crushed stone in another county.

This study is one “snapshot” in time of a very complex and dynamic issue and one that will likely continue to be controversial because people have different interests and the stakes are high. The researchers are continuing their investigation on community impacts by exploring an aspect that was mentioned many times by CAFO operators and public officials alike – the importance of building trust and relationships for coexistence. PD

Janet Ayres
Professor and Extension
Specialist Leadership Development
Purdue University

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