Organic certification costs – Harvest Public Media radio story

Recently a reporter from Harvest Public Media visited our farm to talk about the costs & benefits of organic certification; a well-timed story given concerns over the effect of a stalled Farm Bill on the cost of certification, and the overall conversation we have every year about whether to re-certify. This is a very complicated topic that encompasses everything from giant international mega-farms to tiny local family operations, across a wide range of geographic and climatic settings, producing pretty much every kind of food one can think of, and in various regulatory environments. We thought the story came out quite well overall, and encourage readers to listen to/read it here.

There is one significant clarification we’d like to make, however: the quote from Sue Baird saying “USDA stats said an organic farm nets $20,000 more than the same size conventional farm” is a broad oversimplification and quite misleading in the context of the story; it may be accurate for large grain farms or other high-gross operations, but not for the kind of small, direct-market farms otherwise described in the piece. We didn’t appreciate the implication (though unintended by the reporter) that a $700 certification cost results in $20,000 of additional profit. That’s not even remotely the case. Also, just to clarify for our CSA members, the lettuce being fed to the animals was freeze-damaged or otherwise seconds-quality; you’re not being stiffed!

Assessing the 2012 CSA, Part III: decisions for 2013

After reviewing what we did in 2012, and what members thought of it, we’ve made our decisions on how to proceed with the CSA for 2013. In short, main features will stay the same, we’re adding a delivery fee, expanding the membership, and doing a better job defining the production/distribution season. Read on for more analysis and details of next year’s program, including how to sign up. Continue reading

JJR Farm quitting organic meat & egg sales

John & Julie Rice of JJR Farm face an uphill battle trying to produce certified organic meat & eggs in central Missouri. There are no reliable local sources for organic grains; John’s often had to drive to Kansas or Iowa to get his bulk feed (our bagged feed is shipped in from Wisconsin). The only organic-certified slaughterhouse is in Illinois, a 600-mile round-trip every time they have to process an animal for legal sale as organic (the only way to justify the price of organic feed). 1200 miles, actually, one trip to drop the animal(s) off and one to pick up the meat once it’s ready. Unfortunately, the prices they can get for local organic meat & eggs don’t really relate to the cost of production and certification. Now, after seven years of organic production for local sales, they’re calling it quits. Continue reading

Comparing egg production models

This post is part of an ongoing, fascinating discussion/debate between ourselves and a mid-scale organic egg producer from Wisconsin (commenting as “Mac”), sparked by a comment thread on our earlier post about small-farm egg economics. Read that post and thread first, to gain the context of the discussion and the two farm models under discussion. My latest response simply became too long to be a useful comment and stands well on its own as a comparative analysis of the two models, so we’re published it here for further discussion. Also coming in a future post is a long discussion of our justifications for raising heritage breeds and doing our own breeding, something Mac also initially challenged.

Continue reading

Economics of small-farm pastured eggs


We’ll be selling eggs to off-farm customers for the first time in 2012, having expanded our laying flock to 35 hens. In past years we kept up to a dozen, which laid enough for our own household and some for workers, but this year eggs will be available to CSA members for $6/dozen. That’s higher than anyone around here is used to paying, so I thought I’d share the economic modelling that led us to this price. For reference, our friends at Happy Hollow Farm in Moniteau county came to the same conclusions, and are selling their certified organic eggs at $6/dozen as well. Our eggs are not certified organic and should not be referred to as such, though we absolutely refuse to feed out anything containing GMOs, whether chicken feed or food scraps.

Continue reading

Farm insurance is worthless, 2011 edition

Back in early 2010, we wrote a long post discussing our concerns and negative experiences dealing with farm insurance, in theory a necessity for running a food-production business in this litigious and paranoid culture. In effect, our experience-based argument was that farm insurance (and most insurance) is either a scam or a waste of money, and doesn’t actually protect a small farm because the insurance company can always find a way to back out of the supposed commitment (while keeping your money), and any real farmer doesn’t have the time or money to fight.

A few days ago, I exchanged a few emails with a farmer from southwest Missouri, who is dealing with precisely this problem and wrote to us (and others) for advice. With their permission, here is the email exchange, kept anonymous by request. It speaks for itself as regards this issue:

EMAIL 1:

I have a CSA in Southwest Missouri. This was our first year. We just received a call from our insurance company saying they are cancelling our farm insurance because we get too much exposure. Was wondering if you could share the company you use so we can have some options. I have asked several people. thanks.

MY RESPONSE:

That’s terrible to hear. We have found the insurance industry very frustrating to work with, as no insurance company really cares about or understands small/direct-market farms, and we don’t fit into any of their pigeonholes. As far as we’re concerned it’s an expensive scam that offers no meaningful protection, since it’s so easy for the company to drop you or shirk their responsibility if you try to make a claim. What kind of coverage are they dropping? Basic damage coverage, like property, or product/customer visit liability? If interested, you can read more of our thoughts/experiences with farm insurance on our blog at:

http://cherthollowfarm.blogspot.com/2010/02/liability-and-insurance-on-market-farm.html

I’m a little uncomfortable sharing our insurance details over email with an unknown person, since it is such a problematic subject, but suffice it to say we’ve not found a company we feel good about. May I reproduce your email (anonymously if you like) on our blog, and/or forward to other farmers I know in the area, to see if others have input on the question?

EMAIL 2:

After I wrote a few people trying to come up with insurance, I realized how invasive I was being. Wasn’t trying to pry.Yes, you can reproduce my email. Rather not have my name attached and I will follow your blog. We had farm and property insurance and all of a sudden we got a letter saying the company was going to stop insuring any property that could not be seen from five other properties. We can only be seen by one other farm and he has to be wanting to look our way.

So we called the broker and he said not to worry. Said he had lots of companies and he would get back to us. Soon he sent a bid for insurance more that one forth higher than we were paying before and he accepted our payment after he took what seemed like a hundred pictures and asked over two hours worth of questions.

Then they wanted us to produce books on our U pick orchard which we declined to do because we don’t separate it from the other things we do here and thought it not to be their business. Well, to make a long story short, they called and the exact quote was

” we have been on your website._______ Farm is much too visible and we are going to decline insuring you. We will insure you to the end of the month and prorate your payment.” So , here we are, today is the 7th and we have no insurance past Halloween. Of course, no insurance, no home loan.

This is not the only problem we face. We are trying to refinance the farm at a lower interest rate and no one loans to a “working farm”. Hobby farms only. So I guess for that we will go to Farm Bureau. I am not a conspiracy person , yet I do believe they are trying to get rid of small farmers in order to get a higher tax rate on the land and because he who rules the food supply rules the world.

Thanks again for replying. We will find insurance somewhere before the first and I may just take down the website for now. Didn’t know about your blog when I wrote the first time. I was just trying people from Missouri who had agricultural tourism.

Thanks.

Thoughts or recommendations for this person?

Why market isn’t working for us

When we founded this farm, and especially when we decided to go full-time, we assumed we would be production-limited. That is, our main challenge would be growing enough product to meet demand and make the income we needed. We figured that with good quality, good marketing, and organic status, our products would be popular and in demand in a generally educated, liberal college town with a large farmers market and many locally-oriented restaurants.

We were wrong. This year especially, we aren’t coming close to selling what we grow, and that’s a real problem. After a decent spring, our market sales have gone down significantly compared to last year. We’ve also had some crop failures or disappointments, but even judging just by what we actually bring to market, sales are well below production. I ran some numbers from last week’s market (we keep clear records on exactly what we bring to, and from, market) and the data bear this out. The table below uses numbers from all the perishable items we brought to market (everything but garlic and onions), in other words everything fresh we need to sell that day or it’s lost income. The first column shows the product’s value as a percentage of the total value on the stand; the second column shows the percentage of that item that actually sold. The products are in order of lowest total value on the stand to highest. I’ve intentionally left out the actual product names; the point is the overall pattern.

%value %sold

1      100
3        78
4        83
4      100
6      100
9        96
9        59
10      27
12      33
12    100
13      33
17      66

Overall, we only sold 68% of the total potential value on the stand last weekend. While we can often sell out of small specialty items, we are not making the larger-scale sales needed to really bring in income. We can’t make a living selling just niche products like garlic, herbs, and edamame; we need the regular sales of tomatoes, squash, cucumbers and the like, but customers are choosing not to buy those items from us in meaningful quantities. Running these numbers confirmed what I’d been instinctively seeing all summer: we’re bringing home a lot of very high quality produce, while overall earning less than last year. That doesn’t work for us. So what’s going on?

First, here’s what I think we’ve done right over the past few years:

Good marketing. We have a good web presence, with a website that draws many compliments and a reasonably well-read blog that provides useful and timely information, including cooking ideas and advice. We’ve been featured in most Columbia-area publications, sometimes more than once, and have been written up in many local food blogs. We’re still one of the few area farms with a decent online presence. We’ve held multiple on-farm events targeted at our core audience, including open houses, multiple on-farm meals for the local Slow Food chapter, and other events. We’ve also cooperated with Slow Food in doing many events at area schools. We have a clean, attractive farm stand with clear branding that we receive compliments on every week. We’ve presented ourselves, accurately I think, as good examples of the kind of farmers consumers say they want to support: ethical, organic, foodie-minded, hard-working, full-time, environmentally aware, professional, etc. We refuse to mess with Facebook and Twitter, but given that virtually no other farm in the area does those things either, I can eliminate that as a core problem. I can’t see what more we could reasonably do to present our story, our message, and our products to the intended customer audience.

Good quality. I know our products are as good as you can get around here. I know it because we have extremely high personal standards for food, and we eat mostly our own products. I know it because some of the best chefs in town, like Mike Odette and Trey Quinlan, tell us our products are excellent and continue to buy what they can from us. I know it because we go out of our way to grow, and market, really fresh items. We never sell fresh produce more than a few days old (other than cured/dried items), keep multiple storage areas at different temperatures to ensure proper storage conditions, handle things carefully, cool produce quickly, keep backstock in insulated coolers at market rather than piling it in the open, minimize sun exposure on produce at market, and so on.

Good philosophy. People say they want organic. Survey after survey, media story after media story, the growing demand is for organic. We’re as organic as it gets; we stay away from all sorts of inputs and methods that are technically allowed but not as philosophically organic as customers think. We live the ethics we propound; generating little waste, emphasizing environmentalism and conservation, growing our own food, going out of our way to support other local farmers and businesses, etc.  We are who we say we are, and we are who the general consumer base says they want to buy from.

What’s wrong? So why aren’t our products more popular? Why do most market customers not buy from us at all? Why do those who do, tend to buy $5-$10 at most?

Price. I can only see one place where our farm does not match up with others in the pantheon of consumer desires, and that’s price. We’re expensive compared to most stands at market, though I’d argue we’re pretty competitive with most organic produce in area grocery stores, especially when relative freshness and quality is taken into account. And our market prices match up well with the other few certified farms at market; we’re not out of line relative to our niche.We’re often more expensive than wholesale organic, but that’s hardly surprising since much of the industrial organic system is built on cheap migrant labor and subsidized desert irrigation, just like its conventional counterpart. We can make sales of items other market stands don’t have, like diverse garlic and edamame, but not anything for which we have competition, like squash, cucumbers, or tomatoes. That tells me it’s a price issue, because the quality is good and the quantity is there.

When you walk down the aisle at the farmers market, we look expensive because we’re directly competing largely with part-time farms which, even when well-meaning and well-run, have off-farm and/or retirement incomes and otherwise aren’t treating their business the way we treat ours, as a full-time long-term profession and not a source of cash on the side. It’s not hard to make a profit selling produce (especially if you don’t account for the value of your labor), but it’s awfully hard to make a real living. Our prices have to include insurance, retirement savings, health costs, long-term rolling averages of inevitable crop failures, home repairs, etc…all things that people with jobs or outside incomes just don’t need to think about earning from produce. I think I can count the number of real full-time professional farms at our market on one hand (there are over 70 overall), though I suspect most customers don’t realize that, and some of those farms have to make sales in big-city markets like St. Louis to stay in business, despite our market location in a city of 100,000. It’s like trying to run a professional auto repair shop with five neighbors doing quickie $10 oil changes in their garages because they like working on cars in their spare time.

Customer spending. In no way do I intend to demean the many loyal and interested customers we do have. But the reality is, there just aren’t enough of you, and the per capita spending just doesn’t work for a full-time farm. I wish I had time to keep data on every transaction amount at market, but I’d confidently say that our median purchase is less than $10, with a long tail toward $2-$4 and only a couple people who spend more than $20. If you figure a professional market farm has to earn at least $1000 per market (gross) to even have a chance (30 markets x $1,000 = $30,000 gross income, still not very much), then that’s roughly $4/minute in sales for a 4-hour market. Business isn’t anywhere close to that, either in quantity (lots of customers) or magnitude (significant single purchases).

According to 2009 USDA numbers, the average weekly grocery bill for a 2-person household could range from $80 to near $160. Assuming we’re targeting the middle-upper range of that spectrum, our normal market sale of around $10 is anywhere from 6%-8% of the total weekly grocery budget of an average market customer (even at the low end, it’s only 12%). Given that the USDA thinks vegetables should be 25% or more of any given meal, that’s a big gap in potential spending, and that’s really hurting us. Either people aren’t eating many vegetables, or they’re not buying them from us despite being theoretically/statistically able to do so. Granted, we don’t grow everything people could want, but we have a lot more diversity than most customers choose to purchase from us.

Using the $1,000 threshold mentioned above, even at $4/customer we only need 250 customers per Saturday to buy from us, out of the 3,000-4,000+ customers the market estimates attend every week. Our internal numbers tell me we’re getting far less than that; I think we’re more in the 70-100 range. That tells me that a farm like ours simply is not of interest to most market customers, even though it’s theoretically supposed to be. People vote with their wallets, and we’re not getting elected (note that I wrote about concerns with market last year, too).

Recession. This is the easy out, simply accepting that we’re in a bad economic time and lots of businesses and individuals are hurting, and people are cutting back and looking for cheaper options. Overall, it’s true. But what I’d like to know is, are people cutting back the same everywhere? Our sales this summer are down roughly 30% from last year (still not a great year). Is the same true for cell phone and electronic sales? Jewelry? Clothes? Cable/satellite TV? Tobacco? Will the Mizzou football stadium be 1/3 empty this year, with people refusing to pay huge markups for generic food and beer? If all of that is true, then fine, the recession is really here. If not, I’m curious why our food is high on the list of early budget cuts when other things apparently are not. Even with tightened belts, there are enough people in Columbia and/or enough coming to market to make even $5-$10 individual sales worth it, if the total purchasing activity was there at our stand (which it isn’t; see above). Virtually anyone can afford $4-$5 at a weekly farmers market, if they chose to spend it with us; that’s just not happening.

Going CSA. The situation described above is one, among many, reasons we’ve decided to change our business model to a CSA next year. While we still have to do the work to find and retain customers, going CSA gives us access to the entire area population instead of the small niche of market-goers. It guarantees an end home for what we grow, and lets us focus our work, skill, and stress on production, not marketing. It removes individual product prices as a factor in consumer behavior, replacing it with an annual return on investment that will be easier for them to judge and value. Long-term we still have to manage the farm well enough to grow enough product to support enough customers to make a good living, and that’s an ongoing learning experience, but it takes most of the uncertainty and inefficiency out of the sales end of things.  And so CSA, we think, is a far more sensible business choice for us than the farmers market, with its increasing uncertainty, cost, and inefficiency, has become.

Health insurance on the farm

We are self-employed, which means we have to supply our own health insurance.  We’d be far better off financially if I took a teaching job (I have a Master’s in science education and could be certified for grades 6-12), which would provide a base salary and health coverage along with a reliable income, but then we wouldn’t be able to run this farm as the business we want it to be, and wouldn’t be able to spend the time together that we value so much. We and those like us take a real risk in our personal health and financial viability in attempting to make a living independently. Many farm-based folks keep some form of off-farm job partly to acquire or afford insurance, even if that caps their ability to build their farm business (I know of good farmers who had to stop farming because they had children and couldn’t afford the insurance and health costs without a “real” job). Many full-time farmers, especially young and start-up farmers, go without insurance entirely because it’s too expensive (like many I know around here).

We aren’t willing to take that risk. A significant health incident (car accident, major disease, mild but disabling injury) would wipe out our ability to run this farm, and we at least want some protection from the financial impacts of such an event. Keep in mind that it’s far easier for a health situation to ruin our business than an average salaried job; even a broken finger that kept me from doing weeding, harvest, and washing/packing  for a month would be a disaster for us even if it was financially negligible from the health expense point of view.

However, health insurance costs are awful for us. We have a 5-figure deductible in an attempt to keep costs down, meaning in effect we pay all our medical expenses out of pocket, even responsible preventative care like annual checkups. Dental and eye care is entirely on our dime, no coverage of any kind. The insurance is only for ruinous, life-changing incidents like major injuries or diseases, because that’s all we can remotely afford, even with the massive deductible, and even with our extremely healthy and low-risk lifestyle (like only driving twice a week instead of most commuters’ 5-6 days a week, and rarely during dangerous commuting hours). We even joined a smaller Missouri-based insurer that has reduced coverage for expenses incurred out-of-state, in an effort to keep costs down since we rarely travel. Unlike most couples, we’ve chosen not to have children (partly for financial reasons), which again keeps our costs and risks down but isn’t a viable choice for many people who truly want children, as our culture strongly encourages. And yet costs are inexorably rising for no change in benefits.

At the start of 2010, we paid $204/month to cover both of us (Joanna is far more expensive than I am solely because she’s female). In August 2010 that went up to $254. We just received a letter stating that in August 2011 it will rise to $300/month. Nothing in our coverage has changed or improved, and we really have no choice in the matter. We had already gone with the cheapest option we could find, and have no indication the rates won’t keep rising like this.

This is one of the biggest single expenses in our lives, for which we receive no benefits except the potential to not be bankrupted by a disaster, which we effectively would be anyway because a health incident that cost over our 5-figure deductible would wipe out the farm for all practical purposes and force the non-injured person (if that wasn’t both of us) to get some form of job just to support us. In that situation, our business and our lives as we know them would be over.

We loosely supported health care reform because we wanted something to change, to reach a system in which self-reliant entrepreneurs had a fair chance at getting started on their own, without feeling the need to be trapped in a “regular” job just to manage personal risk. Although we have philosophical concerns about the individual mandate, it also seemed the only way for entrepreneurs like us to have a fair chance in the modern world. However, the trend happening in our lives is not what we expected or desired; food prices and farm income will not keep up with this rate of health care inflation.

Keep in mind that to pay $3,600/year in health insurance costs, we have to earn a lot more than $3,600 in produce sales. Our farm business has to earn enough to pay all of the operating expenses of the farm, plus enough to pay for health & auto insurance, and only then can we even think about paying ourselves so that we can pay the expenses that we incur in our personal lives, and only then can we “keep” any of the remaining income. Because we run our farm and household on a low and tight budget, the percent expenditure in our budget for health insurance is especially high. So think of it this way: for every dollar a customer spends at our farm stand (and most spend under $10/week), a significant percentage is going straight to the coffers of the health insurance company which doesn’t give a hoot about our personal healthy and low-risk lifestyle.

It also doesn’t matter that the core activity of our business (selling fresh, healthy produce) has a direct benefit on our personal health and that of all our customers. Our existence, and our choices, make the country a healthier (and thus cheaper for the insurer) place. Yet none of that factors at all into the cost of our, or anyone else’s, health insurance. We could run a tobacco factory and eat fast food three times a day and still be treated the same by the health care industry.

The final frustration here relates to my earlier point that many other farmers either don’t have insurance or get it through an off-farm job. It’s not my place to fault either decision, but it does affect the economics of prices and marketing. Someone who isn’t trying to pay health insurance, or who has it provided through an off-farm job, isn’t trying to earn that through their farm business, which means they can (and do) charge lower prices and/or make more personal profit (that extra $300/month would be wonderful for us). The former is in effect gaming the system, since if they do get injured the system will still handle them (the classic uninsured problem), while the latter is more responsible but really isn’t improving the sustainable economics of small farms and local foods. We’re being responsible citizens by insisting on having health insurance even at ruinous cost, but we earn far less personal income and get no benefit in the marketplace for that decision, just sniffs that our prices are too high. I can’t exactly put up a sign saying “buy from us because we’re responsible citizens”.

Related to this issue is auto insurance. Consider two periods in our lives. First, the several years when Joanna was working at a 30-mile roundtrip commute year-round, and I was on the farm and driving 25 miles roundtrip to market on Saturdays during growing season. So one of us was on the road six out of seven days for most of the year. Second, the period when Joanna came home and we went full-time, so that now we drive to town twice a week during the growing season (Tuesday restaurant deliveries and Saturday market) and once or twice a month during the winter, mostly during off-traffic hours. One guess as to which period has higher rates. When we went full-time and listed both of our vehicles as business use, as that was now their primary function, our auto insurance rates doubled, even though we’re driving far less and during less dangerous times. And we’re both very cautious, careful drivers with perfect life records. I’m the guy Missouri drivers pile up behind on VV or E because I’m actually driving the speed limit, and the guy who gets cut off on US-63 because I actually leave safe following distance in front of me.  But we’re now paying double our old rates for the sole privilege of being self-employed, in a system that couldn’t care less about our actual driving skill or patterns.

I have a lot of sympathy for the unemployed and underemployed, especially in this recession, but when we look at this budget the cynic in us wonders if we’d be better off not working long days 7 days a week to pay off mostly useless health & auto insurance, and just collecting unemployment or working normal part-time odd jobs while growing only our own food and being uninsured. It would probably be smarter financially than running a responsible, sustainable, honest business whose income is capped by people’s expectations of what subsidized, migrant-picked produce is supposed to cost.

In effect, the current system penalizes good, responsible civic behavior. What are we supposed to do?

Scale fee increases

All scales used for commercial purposes, such as selling at a farmers market, need to meet two requirements. One, they must be “legal for trade”, meaning they’re manufactured in such a way as to be reliable and inspectable/adjustable by the government. These are generally much more expensive (hundreds of dollars) than the standard cheap kitchen-type scales you can buy anywhere for home use. Two, they have to be inspected every year, and given an official sticker saying so. Until recently, this cost $5 per scale, and was conducted by a Weights & Measures inspector from the Missouri Department of Agriculture who would either come out to the place of business (like our farm) or try to do many scales at once (such as moving down the aisle at the farmers market).

We received a letter this fall that the annual scale inspection fee, for the kinds of scales market farmers use, was hereby increased from $5 to $30 (fees for scales of all sizes are going up, from little platform scales to railroad scales). I want to discuss both what this increase means for our farm business, and what it says about why people like us keep losing faith in government.

First, the impact on us. We currently have two certifiable scales that cost around $200 each. If these each have a lifespan of 10 years (could easily be more), those would have cost us an extra $50 each to keep in operation. Now it will cost us $300 each. That’s a big cost increase for a low-overhead farm like ours that is very careful with its budget. Also, we were discussing upgrading to a better platform and/or digital scale (very expensive) to make certain transactions easier and faster for customers. Now that’s off the table, because that money in our budget just got eaten by the new inspection fees. We’re grateful that we didn’t make that purchase just before finding out about the new fee structure.

Now the more complicated part. The reason given for this increase is that the division is trying to keep its fee structure on par with the cost of providing the service. That’s absolutely fair, and I applaud the concept. Certainly, the fact that an inspector might drive from Jeff City here and back for $10 worth of scale inspections isn’t the most efficient use of taxpayer money. So I don’t have a philosophical argument with raising the rates, especially since this is the sort of service governments are best suited to providing.

What bothers me is the context for doing so, and the way in which it’s being done. First of all, making the rates standard for any number of scales is silly, though it is currently required by law. Accepting for the sake of argument that $30 for the first scale is fair, why charge the second, third, etc. scale the same? It actually takes about five minutes to do the scale inspection, such that if we had four scales we’d be paying $120 for 20 minutes of work. Why not have a sliding fee structure to make the cost and time use more efficient for larger numbers of scales? Or have a surcharge for travelling to a specific lone site, while lowering the rates for very efficient settings like a farmers market, where the inspector can serve 60 farms in a couple hours? Or give us the option to take our scales into one of their offices to reduce their travel expenses and to save us money?

Second, the context for this fee increase exposes one of our core concerns about governments: that they operate in a world largely free from consequences. Let’s look at the law regarding scale inspection fees (the current wording was passed in 1994):

2. On the first day of January, 1995, and each year thereafter, the director of agriculture shall ascertain the total receipts and expenses for the testing of weighing and measuring devices referred to in subdivisions (2), (3), (4) and (5) of subsection 1 of this section and shall fix the fees or rate per hour for such weighing and measuring devices to derive revenue not more than the total cost of the operation, but such fees shall not be fixed in amounts less than the amounts contained in subdivisions (2), (3),(4) and (5) of subsection 1 of this section.

In other words, it is the legal responsibility of the Department of Agriculture to keep tabs on the budget for scale inspections, and every year adjust fees as necessary to keep their budget roughly in line. Yet since the current law was passed 15 years ago, that never once happened. As the letter itself admits:

Although the law required that the fee be adjusted periodically to cover the cost of inspections, the fee rate has not changed since 1983 for small capacity scales and 1994 for large capacity scales. Failure to adjust the inspection fee to cover the program costs was noted as a deficiency in a recent State audit report. Unfortunately, as a result the Department is now faced with cutting this valuable program or adjusting the fees accordingly to cover the costs.

And so for fifteen years, businesses were taught to base their budget on the same low fee, instead of adapting to a gradual and expected annual adjustment. Now, all of the sudden, a state audit noticed that the law wasn’t being followed, and a decision was made to rectify it through a massive fee increase. In a narrow view, good for them for finally paying attention (or rather, the State auditor’s office). But in a larger view, this exposes some real problems in the way governments work.

If we, as a private business, ignored a Missouri law for fifteen years, we could be prosecuted, fined, or even jailed. We could easily lose our business, whether directly or through the economic hit of prosecution and restitution of any unpaid fees or taxes plus a penalty (not to mention bad publicity). But when a government agency ignores its own law for fifteen+ years, nothing happens to the people who didn’t do their job; nothing happens to the agency’s budget, their powers, or their right to implement/enforce policy. The penalty for fixing their wrong simply falls on the rest of us who had nothing to do with that failure.

And this sort of thing is why people like us end up sounding anti-government. I’m not anti-government philosophically, but I too often become disgusted with government in the real world, where all too often government failures and incompetence have real and serious consequences for citizens and businesses. For private citizens, failure to know and follow the law is not an excuse. Far too often, for government agencies it’s an unpunished fact of life.

And this is one reason I’m so strongly against increased regulation of farms and food safety: because one mistake on our part could put us out of business, but a plethora of screwups by the FDA or any other agency won’t have any effect on their power to enforce or ignore the law as they see fit. And that’s simply not right.