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 The Center for Agricultural
Business (CAB) at California State University, Fresno plans to seek
input from California agricultural producers on how government
regulations affect their production operations.
The information will be used in a broad study comparing air, water and
other standards in California with those in other states. Leading the
project is CAB Director Mickey Paggi. He is joined by Jay Noel, director
of the California Institute for the Study of Specialty Crops (CISSC) at
California Polytechnic State University, San Luis Obispo. Also assisting
in the work is CAB senior research economist Fumiko Yamazaki.
The research effort was prompted by a growing sense in certain segments
of the agricultural industry that California is perhaps no longer the
best place to do business.
“California growers, processors and distributors must comply with myriad
of rules from local, state and federal levels, regardless of the type of
farming, ranching or agriculturally-related business they operate,”
Paggi said.
And it seems other states have taken note. For example, at the World Ag
Expo in Tulare, one of the major annual agricultural events in
California, states such as Texas, South Dakota, Idaho, Iowa and Oregon
have sponsored booths in the dairy exhibit area.
“They are hoping to draw California’s capital and labor-intensive
dairies to their ‘farmer-friendly’ states. Lower regulatory costs are a
key selling point,” Paggi noted.
The CAB research team believes that policymakers at all levels should be
made aware of the effects of regulations on producers’ profit margins.
If a tipping point of cost versus profit is breached, California may
lose those producers, along with their valuable contributions to the
state’s economy.
According to Paggi, specific objectives of the study will be to compare
standards that affect California agricultural businesses with the
standards in other states that have similar specialty crop production.
The researchers will develop case study reports of compliance costs for
selected California specialty crops and compare them to like crops in
the other states.
Specific codes to be examined include those addressing air quality,
water quality, workers’ compensation and pesticide application.
The current study is a follow-up to work that CAB and CISSC already have
done in this area. Last year the center published a report addressing
the effects of state regulations affecting California citrus producers.
Among other things, that study found that producers’ estimated time
spent addressing compliance issues rose from 7.31 percent in 1999 to
10.27 percent in 2004, a 40-percent increase. That same study also
showed direct costs of code compliance rising, in some cases
significantly.
The current study will provide the latest information available and
should be a useful tool for regulators, Paggi said.
“We want to make the findings of this study widely available to the
public, to agricultural producers and producer organizations and to
policymakers in order to provide more complete information for policy
development regarding these issues for California agribusiness,” he
said.
The researchers anticipate approximately 15 months will be needed to
gather, organize and analyze all the data. Results will be disseminated
next summer through CAB, the California Agricultural Technology
Institute (CATI), and the California State University Agricultural
Research Initiative (ARI), which provided funding for the study.
For more information or details about participating in the study,
contact Paggi at
mpaggi@csufresno.edu.
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