more news about farmers market regulations

Tougher Regulations in Limbo

By Mark Thompson

More than four months after a public hearing on proposed new regulations to help purge farmers markets of cheaters, the judge who presided over the hearing has still not issued his ruling, leaving the new rules in limbo. (See story about the hearing.)

And more than six months after a new state law took effect requiring county agricultural commissioner’s offices to carry out at least one inspection a year of farms that sell produce at farmers markets, some key agricultural counties have still not complied.

As a result of these delays, cheating that is widely acknowledged by industry insiders to be disturbingly widespread in farmers markets continues with impunity. Meanwhile, consumers who spend several hundred millions dollars a year at California farmers markets have been kept in the dark about the truth by misleading advertising distributed by some farmers market managers.

For example, a flyer handed out at the manager’s table in one of the largest markets in Southern California, entitled "What is a Certified Farmers Market," asserts that the producer certificate that market vendors carry "is issued by the County Agricultural Commissioner who verifies that the farmer has grown the crops." In fact, some major counties have never inspected farms or taken any other steps to verify that the farmer actually grew what they are selling, and in many other counties, inspections have been sporadic and cursory.

A flyer distributed at another market asserts that farmers at the market "are certified by the State of California to grow what they sell at their stall" (emphasis in the flyer). In fact, state officials have had the funding to carry out only a handful of inspections each year. Moreover, unbeknownst to most consumers, farmers are permitted to sell produce grown by someone else under a widely abused loophole in the direct marketing regulations. That is one of the issues addressed by the new regulations that have been sitting on Administrative Law Judge William Hoover’s desk for the last four months.

The controversial loophole in the direct marketing regulations allows farmers to sell produce that they didn’t grow by "carrying a second certificate" -- theoretically selling the produce on another farmer's behalf. In fact, in many cases the carried certificate becomes a license for the so-called farmer to become a middleman for a packing house or wholesale produce market.

The pending new regulations, drawn up over a period of two years by a committee of farmers and market managers called the Integrity Task Force, will allow farmers to carry only one second certificate a year and to clearly separate that produce on their market table from the produce they grew themselves.

Cheating also occurs when market vendors who are not farmers enter into a lease or partnership with an agricultural producer and then sell the produce to unsuspecting consumers as if they grew it themselves. The new regulations will require that vendors who enter into leases or partnerships actually play a central role in the agricultural production.

Those market managers and farmers who have been pressing for the tighter regulations have become increasingly frustrated at the administrative judge's unexplained delay, which will next go to the secretary of agriculture for approval.

Bob Cummings, a top official in the division of the Department of Food and Agriculture that regulates farmers markets, couldn’t predict with any confidence when Hoover might finish his review of the new regulations. "I could say two to four weeks and that would be my best guess," Cummings said in mid July.

He was careful to avoid criticizing Hoover, of the Office of Administrative Hearings. "I can’t second guess the judge. It was a very complex hearing. The regulations are very controversial. And the judge has a lot of other work to do. That’s why it’s taking so long," Cummings said.

But Cummings acknowledged that the delay has hampered efforts to take more aggressive action to drive cheaters out of farmers markets.

"There are ongoing problems of people representing themselves under various kinds of lease agreements and partnerships and under which they’re actually buying and selling," said Cummings. "The new regulations are designed to help minimize that problem. That problem is ongoing right now. To what degree it’s ongoing is very difficult to say but we know it’s ongoing.

"The same thing with people representing that they’re carrying produce under second certificates," Cummings added. "We know that there’s buying and selling going on under those carried certificates. Obviously the sooner we get the regulations in place the better off we’re going to be in doing a little better job of controlling these people."

Enforcement by state officials will be stepped up in the future thanks to a new $10 annual fee that all farmers who sell at farmers markets are supposed to pay into a state fund to cover the cost of more inspections. The enforcement fund was created by a law enacted by the Legislature last fall, which took effect Jan. 1.

Meanwhile, under the same law that implemented the $10 enforcement fee, county agricultural commissioners offices are now required, for the first time ever, to carry out an annual on-farm inspection of those who apply for a certificate to sell at farmers markets. Removing the poverty excuse used in the past to explain the lack of scrutiny, the law permits county officials to charge farmers up to $60 a hour to cover the costs of the inspections.

However, midway through the year, some counties, including San Joaquin County, home of several hundred farmers market vendors, still had not taken action under the new law.

San Joaquin County was singled out for criticism for foot-dragging at a meeting earlier this year of the state’s Certified Farmers Market Advisory Committee, a panel of farmers and market managers created by last year’s legislation. Several members of the panel noted that San Joaquin, one of the largest agricultural counties in the state, has never charged a fee for certified producer certificates and the county’s critics also asserted that repeated problems of alleged cheating have emanated from the county.

The county’s agricultural commissioner, Scott Hudson, told In Season in June that he wasn’t eager to tighten enforcement unless there was strong support from the growers themselves. "We notified the growers by letter that there would be a fee," he said. "It’s a fee I never would have proposed if there wasn’t a mandate."

He added, "We have not had the time to do a 100 percent inspection." Hudson said his office would have to seek approval from the county board of supervisors to begin collecting a fee, though his office had not yet taken that step.

In one of the more decisive steps taken so far this year toward tougher enforcement at farmers markets, the Advisory Committee completed work in June on a "matrix of civil penalties," which specifies what fines and other sanctions will be imposed against farmers caught for cheating at farmers markets. In July, the schedule of penalties was undergoing a final review by the agriculture department’s lawyers.

The fines were authorized under last year’s legislation. Until now, the only penalty for cheating at farmers markets has been suspension of the vendor’s certified producer certificate, a drastic sanction that county agricultural commissioners have only rarely imposed.