River Valley Poultry Farms Ltd. v. The Corporation of the Township of Stone Mills, 2001 ONNFPPB 8

ONTARIO

NORMAL FARM PRACTICES PROTECTION BOARD

Embury v TWP of Stone Mills

2001 ONNFPPB 8

DATE OF DECISION:

2001-03-30

2000-13

STATUTE:

Farming and Food Production Protection Act 1998

HEARING:

BETWEEN:

River Valley Poultry Farms Ltd. -- Applicants

and

The Corporation of the Township of Stone Mills -- Respondents

REASONS FOR DECISION

BACKGROUND

The Corporation of the Township of Stone Mills (“Stone Mills”) is an amalgamation of three municipalities located northeast of Napanee, Ontario. The area is rural in nature and the topography is quite variable with areas of productive agricultural soil and areas where bedrock is at or near the surface.

River Valley Poultry Farms Ltd. (“River Valley”) is owned and operated by the family of Elwyn Embury. Mr. Embury and his family have developed a very large poultry layer operation with 275,000 units of quota. River Valley also owns 430,000 units of pullet quota. The layer quota is filled on an annual basis with a single crop of birds. Two crops of pullets are raised each year and the capacity for pullets is about 205,000 at any one time in the various barns owned by River Valley.

The Applicant also carries on a beef operation with 125 cows and their calves. The beef calves are raised to a large size in a small beef feed lot holding 120 beef feeders and 10 bulls. Finally, River Valley raises approximately 100 market pigs each year.

River Valley also operates a small retail store which sells eggs, beef and pork produced by the farm.

The major thrust of River Valley’s enterprise is the poultry operation. River Valley has the third largest layer operation in Ontario and the pullet business is also a very substantial one.

FARMING AND FOOD PRODUCTION PROTECTION ACT

The Farming and Food Production Protection Act, (“the Act”) provides the statutory framework for this application. The sections of the Act which are relevant to this application are:

Section 1(1) of the Act defines "normal farm practice" as a practice that:

3

a. is conducted in a manner consistent with proper and acceptable customs and standards as established and followed by similar agricultural operations under similar circumstances, or

b. makes use of innovative technology in a manner consistent with proper advanced farm management practices.

Section 6(1) of the Act states:

No municipal bylaw applies to restrict a normal farm practice carried on as part of an agricultural operation.

Section 6 (15) of the Act states:

In determining whether a practice is a normal farm practice, the Board shall consider the following factors:

1. The purpose of the by-law that has the effect of restricting the farm practice.

2. The effect of the farm practice on abutting lands and

3. Whether the by-law reflects a provincial interest as established under any other piece of legislation or policy

4. The specific circumstances pertaining to the site.

In this application, River Valley alleges that Section 9 of the Nutrient Management By-Law of Stone Mills restricts normal farm practice. Four specific issues were raised by River Valley. Three of those issues were raised in the middle of the proceedings and will be dealt with at a later hearing. Accordingly, this part of the hearing is limited to a determination of a single issue. That issue is contained in Paragraph 9 of By-Law 2000 – 83 which the owner of an intensive livestock farm shall own a minimum of 40% of the lands which are part of the Nutrient Management Plan.

This issue is whether this section of the by-law restricts a normal farm practice.

The Board heard evidence from John Ulania, a professional planner and Bob Clancy, a member of the Municipal Agricultural Committee regarding the history of the bylaw. According to these witnesses, nutrient management planning was something which had been discussed in abstract terms by the Municipality for a number of months in late 1999 and early 2000 as the Municipality was in the process of amalgamation. The issue developed an immediate relevance when a swine producer began to study the feasibility of constructing an intensive swine facility in the municipality near a hamlet that is adjacent to a lake and which is dependent upon tourism. It is clear that citizens of the Municipality and the council reacted to this proposal with alarm.

The council appointed the Committee of Adjustment as an agricultural committee charged with responsibility to prepare a nutrient management by-law. Mr. Clancy testified that there were five or six intensive farm operations in existence within Stone Mills and the evidence would indicate that none of these facilities caused any degree of concern at that time.

However, the Municipality had experience with pollution caused by agricultural runoff . The community of Newburgh has experienced high quantities of nitrates in well water for a number of years. The source of the nitrates is a beef farm near the village. Frank Crossley, a hydrogeologist employed by the Ministry of the

Environment testified that he had been involved with the investigation of this problem. The soil in the immediate vicinity is very shallow and the rock is full of fractures and fissures. Manure run off can easily enter the water table. Bottled water continues to be supplied to a number of homes in Newburgh. This example indicates how the improper use of manure can have significant ramifications to a community. The agricultural committee held three public meetings. There is no evidence to indicate that they were widely advertised in local newspapers. Mr. Uliana and employees of the Ontario Ministry of Agricultural, Food and Rural Affairs (“OMAFRA”) were consulted. Nutrient Management By-Laws from other municipalities were reviewed. Mr. Uliana then drafted the by-law. Mr. Uliana testified that the by-law was reviewed on a line by line basis by the council and the agricultural committee. The review was more detailed than most by-law reviews.

Council passed the by-law in June, 2000.

Mr. Hogle submits that the by-law was a rushed response to political pressure placed on council by citizens who did not want an intensive swine operation in their local vicinity. Mr. Hogle suggests that there was no proper consultation with the public and that, at the very least, the five or six existing intensive operators in Stone Mills should have been given notice of the pending by-law. Mr. DeMille submitted that the by-law was the result of careful consideration by the council and the agricultural committee. While the public meetings occurred in February, the by-law was not proclaimed in force until June, 2000. The municipality sought advice from OMAFRA and its planner, as well as from the local community. Mr. DeMille suggests that the by-law is a carefully considered document designed to balance the need for food production by farmers following appropriate practices with the legitimate interests of the larger community to protect the environment.

The decision to have a 40% ownership requirement was the subject of a significant amount of examination at the hearing. Mr. Embury testified that he received information from a member of the agricultural committee suggesting that the 40% figure “had simply been pulled out of a hat”. Mr. Clancy and Mr Uliana testified that the 40% ownership number represented a carefully debated compromise between committee members who wanted a land ownership requirement ranging from 35 – 90%. In the end, council and the agricultural committee felt that a 40% ownership requirement represented a fair balance between the interests of farmers and the wider community.

In the end, this debate is of little relevance to the case. Whether the by-law was a panicked reaction designed to prevent a swine farmer from moving into the local area or whether it was a carefully crafted by-law in which a 40% ownership figure was chosen in order to provide protection to the wider community is not relevant. The Board is presented with the by-law in its current form and must determine whether the by-law restricts normal farm practices. Although we have concluded that the impetus for the by-law is not relevant, we would note that we were impressed with the evidence of Mr. Clancy and Mr. Uliana. While Mr. Embury was not personally aware that a by-law affecting his operation was about to come into force, we are satisfied that there was significant communication in the community before the by-law was implemented.

EFFECT OF BY-LAW 2000-83

The by-law is designed to control intensive livestock operations in Stone Mills. Existing operations are not required to take any action. However, if a new intensive operation is established, or if an existing intensive operation wishes to expand, building permits will not be issued unless the farmer complies with the by-law. There are several requirements with which the farmer must comply before a building permit will be issued. The ability to withhold the building permit is the major control mechanism within the by-law. There are only two requirements which are relevant to this portion of the hearing. The by-law requires the farmer to prepare a nutrient management plan. The by-law also requires the farmer to own not less than 40% of the land base which is necessary for the disposal of manure.

River Valley has prepared a nutrient management plan (“NMP”). The document was prepared by a team from the firm of Argue & Associates. Mr. Wallis, a hydrogeologist, was retained to study the water issues related to the site. Mr. Bird of Argue & Associates and Mr. Wallis both testified. It is obvious that River Valley has expended a significant amount of effort and many thousands of dollars in the preparation of the NMP.

River Valley objects to the 40% ownership requirement. The position of River Valley is that an ownership requirement of 40% unduly restricts normal farm practices. Those practices which River Valley alleges to be normal are the use of cooperating landowners who receive manure from River Valley for use as nutrients in crop production and the disposal of some manure to a commercial composting facility.

PRACTICES OF RIVER VALLEY

The River Valley operation generates a large amount of manure. The calculations from the NMP, prepared by Argue & Associates and reviewed by Mr. Stone from OMAFRA, indicate that 5628 tons of solid manure are generated annually by the operation. Additionally, 472,166 gallons of liquid manure and water run-off are generated by the pigs and part of the cattle operation.

The poultry manure generated by River Valley is all handled in a dry form. The manure is taken from the barns to a storage location. The manure is sheltered from the weather at all times in a manure storage structure. The barns and the storage structure have floors which are impermeable. The storage facilities meet the requirements of the NMP.

River Valley has invested approximately $70,000.00 in two specialized manure spreaders which are finely calibrated to provide control over the amount of manure spread upon the ground. River Valley enters into arrangements with other farmers who wish to receive the manure. River Valley may deliver the manure to the cooperating farmer or the farmer may use River Valley’s spreaders. The manure is always delivered to the storage facility by River Valley and moved at a later date to the contract land, as Mr. Embury does not want third parties having direct contact with the barns. This is a precaution to prevent disease from being introduced to the birds.

The cooperating farmers spread the manure on their soil where it is used as a nutrient, primarily in the production of hay and pasture. River Valley also has an arrangement with a commercial composter. The composter takes several hundred tons of manure each year for composting purposes.

The liquid manure produced by the operation is also spread upon fields and used for nutrient purposes. However, most of the concern in this case focused on the poultry manure as it forms the bulk of manure from the River Valley enterprise.

REQUIREMENTS OF NMP

Manure is a valuable nutrient when applied in appropriate quantities to agricultural land. However, manure very quickly becomes a serious source of pollution if applied in concentrations which are greater than the crops can remove from the soil. A nutrient management plan is meant to provide a farmer with information to indicate the concentrations of manure which are beneficial and which will avoid pollution.

An NMP is designed to respond to local conditions. Soil samples are taken from various fields that are to receive manure. Crop production averages from the townships are obtained from the Provincial Crop Insurance Program. The nutrient uptake of the crops to be planted on the land receiving manure can be calculated.

The quantity of manure which can be placed upon each parcel of land is calculated. A farmer who monitors spreading equipment carefully should be able to avoid placing excessive quantities of manure upon fields if an NMP is carefully followed.

The witnesses unanimously agreed that an NMP is beneficial to intensive agriculture. However, there were sharply divergent views as to the use to be made of the NMP. Generally speaking, witnesses testifying on behalf of the Applicant (both experts and non-experts) felt that a farmer following an NMP would not need to be subject to further controls beyond periodic reviews to monitor the progress of the plan. Generally speaking, witnesses testifying on behalf of the Respondent (both experts and non-experts) support the position that further controls upon intensive livestock operations are needed.

The witnesses for the Respondent support the position that a minimum percentage of land ownership is a requirement which is necessary to ensure compliance with an NMP. If land owned by other individuals is lost, the 40% land ownership requirement means that the operator will have land available to handle manure on an emergency basis while other land is located. The land ownership criteria would reduce reliance upon cooperation from third parties in order to obtain land needed for manure.

POSITIONS OF THE WITNESSES

As noted previously, witnesses testifying on behalf of River Valley provided evidence to the effect that an NMP is the only control mechanism needed to ensure proper manure management. Witnesses testifying on behalf of the municipality generally provided evidence suggesting that a minimum percentage of land ownership would be needed to ensure proper manure management. The relevant evidence can be summarized as follows:

Elywn Embury

Mr. Embury has successfully operated a huge business for many years. He has not caused environmental problems in his community. He has used innovative methods such as composting and taking the manure to storage sites at locations which are separated from his barns so that the manure can be picked up by the cooperating farmers at appropriate times.

Mr. Embury has also invested in a detailed and undoubtedly expensive NMP. Having witnessed Mr. Embury's demeanour, the Board is confident that Mr. Embury will follow good management practices and will implement the NMP.

Perhaps the most impressive tribute to Mr. Embury's management practices is the fact that none of the witnesses testifying on behalf of the municipality complained about the existing manure handling practices. In most cases before the Board dealing with existing operations, evidence of management concerns has been voiced by witnesses. In this situation, the Board is left with the impression that the local community has not been troubled with the practices of the River Valley operation.

Brian Ellsworth

Mr. Ellsworth is the General Manager of the Egg Producers Marketing Board. He has been involved with the Egg Producers for many years. Through his work, he has observed the management practices of many egg producers in Ontario.

As a result of his observations, Mr. Ellsworth testified that many egg producers operate on a small acreage. These producers rely on contracts to obtain land where manure can be spread. Mr. Ellsworth stated that this practice is common "especially for large producers".

The egg industry focuses on production in the barns. Poultry farmers tend to have smaller land bases than other livestock producers because poultry farmers buy most of their feed.

There are approximately 400 members of the Ontario Egg Producers. Their production numbers vary from 500 – 400,000 hens. The Egg Producers organization agrees that NMPs are appropriate tools for the safe management of manure. However, Mr. Ellsworth testified that good management of manure is more important than owning a particular percentage of the land base needed for manure management.

Dr. Peter Hunton

Dr. Hunton is a poultry specialist employed by the Ontario Egg Producers. He has been employed by the Ontario Egg Producers for approximately 20 years and obtained a PHD in poultry science in 1968.

River Valley sought to introduce Dr. Hunton as an expert with regard to the manure management of egg producers. After hearing argument, we note that Dr. Hunton does give general advice to farmers in manure management and refers detailed engineering work to others. The panel appreciated Dr. Hunton's candor and concluded that he should be permitted to provide expert evidence and the Board would then determine the weight to be placed upon that evidence at the end of the hearing. As a result of the fact that Dr. Hunton is not the most highly qualified expert appearing in this hearing, we did not place significant weight upon his opinion evidence in arriving at our decision, but the evidence based upon his personal knowledge of the industry is of some benefit in the assessment of normal farm practice.

Prior to the hearing, Dr. Hunton obtained information from a number of egg producers. This information was placed in the chart which is Exhibit 7. Dr. Hunton readily acknowledged that his work is not a scientific survey of manure management practices. He simply obtained information from a number of farmers who were prepared to provide this information.

Exhibit 7 does not lead to any firm conclusion regarding the percentage of the land base needed for manure management under ownership of egg producers. Some of the operations have more than enough land to manage all manure. Others have less than 40% ownership. In reviewing the chart, farm #12 is a very large farm in eastern Ontario. Farms #9, 10 and 11 are owned by one family and also form a very large operation.

Dr. Hunton's most relevant evidence is based on his personal knowledge regarding farm practices. He testified that it is a common practice for farmers to spread manure on contract land. It is impossible to establish any standard percentage based upon the evidence before the Board because the farms have a wide array of practices and no comprehensive study has been completed by the Egg Producers.

However, Dr. Hunton advised the Board that the use of contract land tends to become more common as farms get larger. The applicant farmer is the third largest egg producer in Ontario. The applicant is a "fairly unique" operation. The Egg Producers organization supports provincial standards for property manure management instead of a patchwork of local by-laws for manure and management.

Neil Currie

Neil Currie is the General Manager of the Ontario Federation of Agriculture ("OFA"). He is a former General Manager of the Canadian Egg Marketing Agency. He was not qualified as an expert witness and his evidence is limited to his observations of the industry. He has visited different producers across Canada and has observed the practices of a number of large egg operations including the applicant's business.

Mr. Currie stated that egg producers "by and large" restrict land ownership and focus upon their barns. The cost of production formula for which producers are paid is based upon a ten acre site. It is "not unusual" for egg farmers to use leases or contracts for manure disposal and many of the large operations are especially dependent upon these practices.

The OFA is of the opinion that contracted land is satisfactory for manure management and that manure management agreements should be written. The OFA believes that the key is a written agreement confirming that a livestock operator has sufficient acres to safely handle manure. The OFA supports nutrient management plans and supports the concept of legislation to govern this planning.

The NMP will permit farmers to manage manure for the benefit of the soil and to maintain good water quality. In cross-examination, Mr. Currie commented upon the form of land agreement in the nutrient management plan at Exhibit 3, Appendix I. Paragraph 6 of this form indicates that the agreement is not binding if the land is sold. Mr. Currie noted that solid agreements "are needed" in order to make long term planning work for nutrient management. Mr. Currie also expressed the view that land must be available for 3-5 years in order to permit an NMP to function properly.

Norman Bird

Mr. Bird has been an Engineer for many years. He was employed by OMAFRA until 1995 and then began employment with the firm of Argue & Associates. He has worked with the River Valley operation since 1995. Mr. Bird's speciality has been the design of poultry buildings.

Exhibit 3 is the first NMP designed by Mr. Bird and his firm. One member of the team did take a course offered by OMAFRA to assist consultants with NMP development. River Valley submitted that Mr. Bird is qualified to provide opinion evidence regarding the NMP. The submission was based on the position that manure disposal work associated with the design of poultry buildings was appropriate experience to permit Mr. Bird to provide opinion evidence.

Stone Mills objected to Mr. Bird's qualifications. After listening to evidence regarding qualifications and hearing argument, the Board determined that Mr. Bird is an expert with regard to the production of manure in barn or storage structures.

He is also qualified to give evidence regarding the methodology used for the preparation of the River Valley NMP. However, Mr. Bird is not an expert with regard to the application of manure upon soil or any of the issues dealing with the appropriate rates of manure application.

As far as methodology is concerned, Mr. Bird testified that the team at Argue & Associates purchased a computer program from OMAFRA designed to assist the NMP process. A member of the firm obtained training from OMAFRA. Maps were used to determine the soil types in the various fields. Information regarding crop rotation and nutrient uptake of various crops was utilized and the implementation strategy for the NMP was developed. With the use of the OMAFRA computer program and the investigation of Argue & Associates, a very detailed and impressive NMP was developed. The highlights of the program are:

1. River Valley and eleven cooperating farmers have a total of 2,686 tillable acres included in the NMP;

2. The soils in the various fields were sampled by Argue & Associates;

3. 2,495 acres of the land base will receive manure in any particular year of the plan;

4. 191 acres of River Valley's fields will be held in reserve with no manure assigned to them. Therefore, if some of the contract land is lost, there is a reserve of 191 acres available to receive manure on short notice;

5. Areas that are unsuitable for manure such as buffer areas adjacent to water courses will not receive manure;

6. The application rate is low. The soil can easily absorb the manure to be placed upon it without leaching;

7. The liquid manure component of the operation was analysed to insure that proper quantities would be applied to the soil;

8. The margin for error was estimated by Mr. Bird to be 25%. The intention of the plan is not to spread manure to the limits of the capability of the soil.

In summary, Mr. Bird takes the position that the NMP is the only control measure needed for the safe management of River Valley's manure. As long as the NMP is followed, the manure will not cause an environmental problem even though the plan requires the vast majority of the manure to be spread on contract land or to be received by the composting facility. Only approximately 3% of the total manure will be spread upon River Valley's own land in each year because 191 acres of River Valley's land is being retained as a reserve.

Mr. Bird was cross-examined on the issue of compliance which is one of the main concerns regarding NMPs that would lead municipalities to want high levels of land ownership by farmers. Compliance is left with the farmer. Argue & Associates does not monitor the plan. OMAFRA does not monitor the plan.

The farmer has to maintain records and honour the plan. The view of the Board is that while this issue does not appear to be a significant problem with the farm operated by Elywn Embury, the lack of a policing mechanism is a legitimate concern as NMP planning develops in Ontario.

Robert Stone

Robert Stone is a professional Engineer who has been employed by OMAFRA in soil management since 1969. He was qualified as an expert in soil management. Mr. Stone reviewed the NMP prepared by Argue & Associates and signed the document to confirm that it complies with the nutrient management review criteria of OMAFRA.

Mr. Stone has significant experience in soil management and the manner in which manure relates to soil management. He testified that it is very common for farmers to use land owned by other parties for manure. He testified that the poultry industry has a higher reliance upon contract land for manure management than other livestock industries. Mr. Stone expressed the opinion that farmers in eastern

Ontario do not have a problem obtaining landowners who are willing to accept solid manure of the type produced by the Embury poultry operation. Liquid manure is somewhat different because the large amount of liquid makes travel with manure to distant sites uneconomical.

In cross-examination, Mr. Stone was referred to Exhibit 14 which is a Farm Practices position statement dated November, 1998, prepared by OMAFRA and Exhibit 15 which is a guide to agricultural land use dated March, 1995. Mr. Stone stated that Exhibit 15 is not a policy statement of the provincial government. He testified that the current position of OMAFRA regarding manure management is accurately set out in Exhibit 14 which is dated November, 1998. The relevant paragraph reads Land Ownership Following good manure management practices is more important than the issue of who owns the land upon which the manure is produced or upon which the manure is applied. It is in the best interests of all parties, however, to develop and maintain written agreements when manure is to be applied to rented or leased land. Application rates should follow a nutrient management plan and records should be kept.

Mr. Stone was also examined with regard to the manure acceptance contracts at Appendix 1 to the NMP. The agreements were variously referred to as "leases" or "contracts" during the hearing. These documents are based on an OMAFRA model provided as samples to municipalities. Mr. Stone's attention was drawn to paragraphs 6 and 7 which appear to contradict each other to some extent.

Paragraph 6 limits the agreement to the current property owner. If the land is sold, the new landowner is not bound to accept manure. On the other hand, paragraph 7 states that the agreement may be registered against title to the owner's land.

While Mr. Stone is not aware of any agreements being registered on title to land and is not aware of farmers having to enforce agreements with land owners, the Board is concerned with the wording of this model document. While the purpose of contracts may be defeated if requirements are so stringent that landowners won't participate, the Board believes that these agreements should be reviewed by OMAFRA if they are being used by municipalities as models and included as important parts of NMPs.

Mr. Stone also testified about the computer program developed by OMAFRA to assist with nutrient management planning. Consultants receive training and purchase the program from OMAFRA. The program performs several functions including:

1. Assisting with the calculation of the size of manure storage needed for farms;

2. Average yields of crops in local areas are provided based upon crop insurance information. Therefore, nutrient uptake information is local in nature and allows for local soil and water

3. _______ calculates the nutrient limits for soils and provides application rates which are appropriate. The calculations provided by the computer model are "well below" the maximum level which soils will safely absorb.

Once again, the issue of enforcement was raised in Mr. Stone's evidence. OMAFRA is providing third party review of most of the plans as this process is developed.

OMAFRA is not undertaking the job of monitoring compliance with the plans.

Frank Crossley

Mr. Crossley is the regional hydrogeologist employed by the Ministry of the Environment. He was qualified as an expert in hydrogeological issues. He provided evidence regarding the local contamination of the wells in Newburgh noted previously in these reasons.

Mr. Crossley provided evidence suggesting that the soils in Stone Mills are quite variable. The bedrock is often at or near the surface and it is fractured.

Contaminates can easily enter the water table in areas where the soil is shallow.

Mr. Crossley is not an expert in manure management. He candidly acknowledged that he "can't answer" whether an NMP is an appropriate safe-guard for ground water. He did state that from the point of view of a hydrogeologist, the important fact is how land is used, and not the ownership of land.

Bob Clancy

Mr. Clancy is a beef farmer in Stone Mills. He has a cow/calf farm. He owns 510 acres of land and rents additional acreage.

Mr. Clancy's involvement arose because he was a member of the agricultural committee of Stone Mills which developed the by-law. The history of the by-law has been noted previously in these reasons.

Mr. Clancy stated that land ownership was a "contentious issue "during the deliberations of the committee. The committee felt that a 40% ownership requirement would not pose any undue inconvenience to a farmer and would leave a manure producer with control over a significant amount of the necessary land. Mr. Clancy felt that the 40% ownership figure was "a compromise".

Mr. Clancy agreed in cross-examination that one of the factors leading to the by-law was a concern in the community that a large hog operation was about to be developed in Stone Mills. It is apparent that a significant part of the community was concerned that appropriate safeguards were not in place for the management of liquid manure from a swine facility. The by-law was, in part, a response to that concern.

Mr. Clancy's evidence is useful because he is a member of the local agricultural community who farms on a commercial basis. He evidently approached the issues behind the by-law with an open mind. His work in the committee led him to conclude, as a farmer, that the appropriate manure management in an intensive livestock operation is an NMP combined with a substantial ownership requirement.

While Mr. Clancy is not an expert witness, his evidence is valuable as it outlines controls which a commercial farmer might feel to be normal or rational for intensive operations.

John Beking

Mr. Beking testified on behalf of the municipality. He has been an egg producer for approximately 30 years and operates a family farm in eastern Ontario with 16,000 laying hens. The land base is 60 – 65 tillable acres on a farm which totals 187 acres.

The Beking farm has approximately 135 livestock units and utilizes 200 – 250 acres of land owned by other people for manure management. Mr. Beking has verbal agreements with his neighbours and has not experienced any difficulty in obtaining consent from neighbours to accept manure.

Mr. Beking is a vice-president of the Christian Farmers Federation of Ontario ("CFFO"). The CFFO is a farm organization. The CFFO issued a policy statement on November 27, 1996 regarding large farms and the environment. This policy statement is Exhibit 20.

Within the policy statement, the CFFO wants livestock operations to own 50% of the land base needed to properly utilize manure. Mr. Beking testified that the 50% policy followed serious debates within the CFFO. While the CFFO accepts the concept of large farm operations, this group concluded that the public image of farmers and environmental safety would require significant land bases under ownership by intensive livestock operations.

CFFO therefore, would not find favour with the proposed River Valley proposal to manage manure through a detailed NMP because River Valley owns only 15% of the land base needed to properly manage the manure output.

John Uliana

Mr. Uliana was qualified to provide expert evidence as a land use planner. He is a registered professional planner and a member of Cumming Cockburn Limited. Mr. Uliana's role in the preparation of the by-law has been outlined previously in these reasons.

Mr. Uliana's opinion is that a 40% ownership rule provides a balance of the interests of the farmers, the wider community and the environment. He believes that a 40% ownership requirement is consistent with good land use planning principles. It is desirable on a public policy basis to require some form of ownership so that a significant portion of the land needed for manure application is always available to a farmer.

Mr. Uliana is of the opinion that NMP by-laws "are a work in progress". He is also of the view that it may be appropriate to develop different standards in the future for wet and dry manure systems. While NMPs are designed to safely accommodate both types of manure in local conditions, Mr. Uliana evidently feels that the risks associated with the two types of manure are not identical.

Mr. Uliana drafted the manure agreements located within Appendix 1 of the NMP. He testified that he based the agreements upon an OMAFRA model.

Wayne Caldwell

Dr. Caldwell obtained a PhD. in regional planning and resource development in 1991. He is currently an associate professor at the School of Rural Planning and Development at the University of Guelph. Graduate courses which he has taught include agricultural land use planning and rural land use planning. Additionally, Dr. Caldwell is employed by Huron County as a senior planner. Dr. Caldwell was qualified as an expert witness with regard to land use planning issues. His evidence regarding manure management issues was provided in an impressive and dispassionate manner.

A large number of intensive livestock operations are located in Huron County. Mr. Caldwell has been in a position to observe the development of manure management by-laws in Huron County which have become common as farms become larger. Mr. Caldwell is also aware of the ground water concerns which arise when intensive livestock operations are developed.

Dr. Caldwell testified that there are two basic models of nutrient management bylaws within the sixteen townships that comprised Huron County prior to municipal amalgamations. Four of those by-laws have minimum ownership requirements.

One township requires 50% ownership while three townships require 60% ownership. Other townships do not have any minimum ownership requirements in their bylaws. Two examples are Grey and Howick. These townships do require proof of an adequate land base for the management of manure and appropriate storage facilities.

Dr. Caldwell suggested that different models have arisen based upon the manner in which livestock operations developed within communities. Large livestock operations have been located in Grey and Howick townships for many years and the councils of these municipalities faced less public pressure than other councils. The communities were accustomed to large-scale operations.

The townships with large land ownership requirements tend to have lower livestock densities. They have developed primarily as cash crop areas and the community has become concerned when intensive livestock operations have moved into those townships.

Dr. Caldwell is concerned about the failure to maintain a balance between the needs of agriculture and the concerns of the wider community. Food production and the environment both require attention. Managing the risk associated with manure is important in order to reduce animosity from the community. If the public is not convinced that proper manure management controls are in place, Dr. Caldwell is concerned that communities may place severe standards upon manure management which cannot be met by livestock operations.

Dr. Caldwell described an NMP as "a useful tool" for manure control. He expects more manure management tools or policies to be developed in the future. However, it was apparent that Dr. Caldwell does not believe an NMP is the only manure management control needed by an intensive livestock operation. Dr. Caldwell is of the opinion that some degree of land ownership is important to the development of policy within rural communities.

Exhibit 14 was placed before Dr. Caldwell in cross-examination. This is the Farm Practices Positions Statement of OMAFRA dated November 1998. The most relevant section of Exhibit 14 was quoted previously in these reasons. Dr. Caldwell expressed the opinion that Exhibit 14 is simplistic. He acknowledges that proper manure disposal practises are "critical". However, Dr. Caldwell believes that an adequate land base is also critical to proper manure management.

In summarizing his opinions, Dr. Caldwell stated:

1. That the proper application of manure is a "key" to the maintenance of livestock operations;

2. While the proper application of manure is "critical" the possession of an appropriate land base is "more critical";

3. The "issue of land control is of key importance".

Dr. Caldwell supports the concept of requiring a minimum land ownership requirement. He believes that the cost of owning land can be compared to the necessity of pollution controls upon automobiles. It is an expense that society may require farmers to meet in order to carry on business.

Dr. Caldwell provided evidence regarding the percentage of land ownership which would be appropriate for intensive livestock operations. His opinion is that a 40% ownership requirement “is as good a standard as any". This standard should be applied to new operations and the expansion of existing farms. Operations which are in existence prior to the implementation of by-laws should not have to accumulate extra land bases to meet minimum ownership requirements.

The witness noted that rental land provides an appropriate method for managing significant quantities of manure. However, the broader planning policy for municipalities is that a certain ownership requirement is needed. A minimum ownership requirement balances the interests of various members of rural communities.

Finally, Dr. Caldwell provided evidence with regard to the difference between liquid and solid manure systems. His evidence is that of a planner and not an agricultural engineer. Dr. Caldwell is of the view that a distinction should be made between liquid and dry manure systems. Liquid manure is harder to handle than solid manure because it is bulkier, and it is not economically feasible to travel as far with liquid manure. It is Dr. Caldwell's opinion that liquid manure is more likely to cause a pollution incident than solid manure. Dr. Caldwell maintains this position even though an NMP is designed to assist the farmer in the management of either type of manure.

Summary of Evidence

We have summarized the evidence of various witnesses at length because the witnesses outlined the differences of opinions held by individuals and groups affected by intensive livestock farms. The witnesses were impressive. They all presented themselves as thoughtful individuals who approach manure management without preconceived biases. The witnesses did not appear to be participating in a crusade on behalf one side or the other. They were not promoting extreme positions.

The divisions of perspective are perhaps best displayed by the fact that two general farm organizations have different policies regarding intensive livestock operations.

The OFA supports the concept of NMPs and written contracts for the management of manure. The OFA regards land control as more important than land ownership.

The CFFO supports a policy in which a significant degree of land ownership is important. The CFFO supports a 50% land ownership requirement. This land ownership would provide a basis for the appropriate management of manure.

When analyzing "normal farm practice", the Board notes that there are divergent views and opinions regarding some of the basic concepts of manure management.

NORMAL FARM PRACTICE

Section 6(1) of the Act states that no municipal by-law applies to restrict a normal farm practice carried on as part of an agricultural operation. The primary issue before the Board is therefore, to determine whether the 40% land ownership requirement restricts a normal farm practice. The definition of "normal farm practice" contained within Section 1 of the Act has two definitions.

1. The first definition is a comparative one which indicates that a normal farm practice is a practice "conducted in a manner consistent with proper and acceptable customs and standards as established and followed by similar agricultural operations under similar circumstances".

The evidence is that River Valley owns the third largest layer operation in Ontario. It therefore should be compared to very large poultry operations. A comparative analysis is complicated because there are significant beef and minor swine components to the operation using liquid manure.

Unfortunately, Dr. Hunton's study is not a scientific review of the egg industry in Ontario. We cannot simply rely solely upon his evidence regarding comparative practices by other large operations.

However, the evidence from a number of witnesses confirms that it is a common practice for large livestock operations to utilize contracts with property owners for the purpose of obtaining a land base sufficient to manage manure. This practice is not limited to poultry operations, but it is our conclusion that the practise is most widespread in the poultry industry.

Accordingly, we conclude that the use of contract land for manure management is a proper and acceptable custom and standard established and followed by similar agricultural operations under similar circumstances.

2. The second definition in Section 1 of the Act states that a normal farm practice "makes use of innovative technology in a manner consistent with proper advanced farm management practices".

After reviewing the evidence, there is no doubt that River Valley's manure management program meets this definition. The use of a commercial composting operation to accept manure makes use of innovative technology especially when the recipient of the manure has received certification from the Ministry of the Environment.

River Valley has invested in manure storage facilities for the solid poultry manure. These facilities are not located beside poultry buildings. They provide storage from which manure can be removed by River Valley or the cooperating landowners at appropriate times. The use of off-site manure storage is an innovative practise.

The sophisticated spreading equipment purchased by River Valley is also a proper advanced farm management practice. The spreaders can be calibrated to provide a very light layer of manure upon the soil where necessary.

The definitions of "technology" within Weber's New Collegiate Dictionary include: (a) a technical method of achieving a practical purpose; and (b) the totality of the means employed to provide objects necessary for human sustenance and comfort.

The Board concludes that the use of a sophisticated nutrient management plan is "innovative technology" as defined by Section 1 of the Act. Formal nutrient management plans are a relatively new practice. It is obvious that a great deal of thought and effort were required to produce the River Valley NMP. The NMP is designed to provide appropriate manure management for River Valley. The NMP is therefore, innovative technology used in a manner consistent with proper advanced farm management practices in order to properly and safely manage manure produced by the River Valley operation.

3. Section 6(15) of the Act also requires us to consider four factors when determining whether a practice is a normal farm practice in applications pertaining to by-laws. This section of the Act was quoted previously in these reasons. The conclusions of the Board with regard to these factors are:

i. We conclude that the purpose of the by-law is to provide control deemed appropriate by the municipality over the construction of intensive livestock facilities in Stone Mills. We also note that the preamble of the bylaw states that Stone Mills "deems it necessary and in the public interest to require the preparation of a Nutrient Management Plan for certain livestock operations".

ii. We have considered the effect of the farm practice on abutting lands and neighbours. The lack of complaints regarding water pollution, noise, odours, dust or other matters arising from River Valley's practices leads the Board to conclude that River Valley's practices have not had an adverse effect upon abutting lands or neighbours. Through the use of a sophisticated NMP, the Board anticipates that the expansion of the River Valley operation is not going to cause any negative effect upon abutting lands or neighbours.

iii. Mr. DeMille provided the Board with a copy of a provincial policy statement issued under Section 3 of the Planning Act which came into effect on May 22, 1996. We have reviewed that policy statement. It provides some very general principles. We are satisfied that the decision in this case does not contradict the policy statement.

iv. The specific circumstances pertaining to the site were considered by the Board. The municipality did not suggest that the proposed site for the barn expansion poses an environmental threat. The Board is satisfied that the various sites being utilized for manure management are appropriate for that purpose.

DOES AN OWNERSHIP REQUIREMENT RESTRICT NORMAL FARM PRACTICE?

The by-law requires an intensive livestock operation to own a minimum of 40% of the lands which are part of NMP. The Board's role in this matter is to provide an opinion pertaining to normal farm practice. Following review of the legislation, evidence and exhibits in this case, it is the opinion of the Board that a 40% ownership requirement does restrict normal farm practices carried on by River Valley.

LONG TERM CONTROL

This is the second decision of this Board pertaining to municipal by-laws. The first decision was Knip v. The Corporation of the Township of Biddulph et al. In that decision, the Board concluded that a minimum ownership requirement in a municipal by-law is unduly restrictive of normal farm practice. The test developed by the Board to reflect normal farm practice was one of long term control of the appropriate land base. It was not necessary for the Board to define "long term control" in detail within the Knip decision. The Knip family owned sufficient land through family members and a corporation to prove that a land base required by the by-law was within the long term control of the farmer. It was not necessary to consider land owned outside the farm family in order to meet the by-law's minimum requirements if one substituted a test of long term control for an ownership requirement.

The Knip decision was appealed by a number of individuals who were parties to the application pursuant to revisions of Section 6 of the Act. The Board has reviewed the Order on Appeal dated October 13, 2000. The Order on Appeal allows the appeal and it sets aside the decision of the Board dated January 8, 1999. The Order on Appeal further dismisses the application that Knip originally made to the Board.

We note that the Order on Appeal is based on Minutes of Settlement filed with the Divisional Court. There are no reasons for decision from the Divisional Court to provide guidance to this Board.

Unfortunately, the Divisional Court decision in Knip was reported by at least one newspaper as having overturned the decision of the Board. This interpretation of the Knip appeal decision is incorrect. The Order indicates that a settlement of some sort was arranged between the parties and the Order is based upon a Consent and not upon an appeal of the merits leading to reasons from the Divisional Court.

In these circumstances it is the opinion of the Board that the test of long term control remains the appropriate indicator of normal farm practice and that a minimum ownership requirement within by-laws unduly restricts normal farm practice.

Having concluded that long term control remains the test through which normal farm practices would control land for manure management purposes, the Board must develop this test beyond the Knip decision. In Knip, the farm family and corporation owned sufficient land to meet the requirement of the township if one substituted long term control for ownership. River Valley clearly does not own 40% of the land needed to manage manure.

Long term control means the ability to use land for manure management purposes for a significant period of time. Long term control does not require the operation generating the manure to lease rights to plant crops upon the land. Long term control means that the operation generating the manure has the ability to utilize the land for the purpose of receiving manure even though others may grow crops upon the land.

An NMP requires control of a significant portion of the land base in order to permit the effective management of manure. A parcel of land available to a farmer for only one year is of little use in long term planning. It is reasonable for municipalities to require farmers to have long term control over a significant portion of the land base to insure that manure management planning can be followed in a fashion which is not detrimental to the environment.

The Board understands that it would be useful for farmers and municipalities to have specific guidelines from this Board regarding normal farm practice. However, we are concerned that sweeping generalizations from this Board may create more difficulties than they solve. For example, the River Valley NMP is relatively simple to administer because most of the land receiving the manure is hay or permanent pasture. The nutrient uptake of the crop is therefore likely to be static from year to year. This situation would not exist in south western Ontario where one would anticipate that a rotation of cash crops with different nutrient requirements would be planted on the same field over a five year period. It is the opinion of the board that the level of long term control that may be necessary to safely manage manure may vary among various types of operations.

The safe and normal degree of long term control may differ among the various types of livestock operations and manure management practices in Ontario. Our conclusions in this application are limited to intensive livestock operations which produce most or all of their manure in a dry form and which develop an NMP based upon hay or pasture as the crops which will receive the bulk of the manure. The necessary degree of long term control to meet normal farm practices would be found in(a t)h e folLloawndin ogw sniteuda tbioyn tsh:e farmer and related family members, corporations or partnerships which form part of the permanent land base operated by a (fabm) ily; Land that is subject to a manure agreement or lease for a period of not less than five years. The agreement would need to be one which would bind subsequent landowners and would insure that the land is going to be available for at least five years;

c. A new NMP may utilize land that has received manure from an operation prior to the implementation of the NMP. If the land has been used by the operation for manure management for not less than two years prior to the NMP and if a three year agreement is signed which is binding upon the land and subsequent land owners, the farmer would succeed in establishing long term control.

d. The type of agreement utilized in the River Valley NMP is a concern. It is limited to the present landowner. It may prove difficult to enforce. On the other hand, the Board is also concerned that if normal farm practice evolves to the point where only documents registered on title for many years can be utilized as part of long term control, it may be impossible for farmers with perfectly acceptable nutrient management plans and available land to obtain the necessary commitments from the cooperating land owners.

We conclude that if a farmer wishes to use an agreement which does not bind the land and is limited to the current landowner, long term control of a parcel of land in accordance with environmentally sensitive normal farm practices can be established as follows:

1. The written agreement can be for a period of not less than five years; or

2. Land can be included under long term control with a three-year agreement if the farmer can prove that the land has previously been utilized by the same operator for manure management for not less than two years prior to the implementation of the NMP. This prior use demonstrates long term control; and

3. The farmer must maintain excess manure management capacity within the operation to provide the capacity to handle manure in the event that a property is lost. Excess capacity could be established either by reserving land (preferably under permanent control of the operator) which will not receive manure or by spreading manure at levels which do not approach the maximum carrying capacity of the land so that a heavier application of manure can be made if necessary to replace land which ceases to be available to the farm. These solutions would be temporary in nature while the farmer diligently seeks alternate land to receive manure.

In the circumstances of this case, we are satisfied that a reserve of 191 acres receiving no manure each year and the decision to spread manure at approximately 75% of the capacity of the land does provide ample security for Stone Mills in the event that one or more parcels of land are lost during the course of the manure agreements.

In summary, River Valley can include the land owned by it together with contract land used by River Valley in 1999 and 2000 which is now the subject of a three year agreement as land under long term control as long as the farm has sufficient land under long term control that is surplus to the ongoing land requirements of the NMP. It is the opinion of the Board that it is not unreasonable for Stone Mills to require River Valley to have not less than 40% of the land base needed for manure under long term control as defined in this decision. In the event that there is any dispute between the parties as to which contract farms would meet the definition of long term control, the Board would be prepared to hear further evidence and provide opinions when the hearing resumes.

POLICING

An issue that was of concern to some of the witnesses is the policing of some of the nutrient management plans. While most farmers adhere to appropriate management practices, the Board is concerned about the fact that policing mechanisms are not in place to deal with farmers who fail to comply with an NMP.

The evidence at this hearing suggests that neither the municipality or OMAFRA is taking responsibility to adequately monitor or police NMPs on a long term basis.

This is an issue which the Board suggests that the legislature may wish to address within agricultural standards legislation.

CONCLUSIONS

In summary, the opinions of the Board are as follows:

1. The use of contract land by large poultry operations in Ontario for manure management is a normal farm practice;

2. The use of a licensed composting facility for manure disposal is a normal farm practice;

3. The use of the off-site manure storage is a normal farm practice;

4. The use of an NMP for manure management is a normal farm practice;

5. The practices of River Valley are normal farm practices if long term control is obtained on enough land. The requirement of a 40% ownership level restricts the ability of River Valley to carry on operations in accordance with normal farm practices. A 40% long term control requirement would not restrict normal farm practice.

At the request of counsel, this decision will be released at this time. The balance of the issues which the Board agreed to hear within the Order dated February 9, 2001 will be dealt with when the hearing resumes.March 30, 2001

[Signed]_______ [Signed]_______

G. Edward Oldfield, Chair Robert Stephens, Vice Chair

[Signed]_______

Marcel Leroux, Member