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A Conducive Business Climate

This section focuses on the needs of not just individual producers, but the entire agribusiness industry - including packers, processors, suppliers, wholesalers and all related businesses and industries that are dependent upon and support agriculture.

Current Condition:

Here are the major obstacles that stand in the way of a conducive business climate for agriculture:

Note: the previous section, Producer Profitability, focused primarily on ways to help individual producers become more profitable and, thus, continue to thrive in agriculture.

Findings from an extensive study of the impacts of regulations on agricultural operations in Hillsborough County indicated that:

Regulations are exceedingly expensive. A common complaint by business owners - and farmers are business owners - is that the massive number of rules and regulations, and the costs of hiring attorneys, engineers and consultants needed to understand and comply with the regulations, is robbing their businesses of profitability and, in some cases, is driving them out of business (see Excerpt #7 "The Problems With Regulations.").

Regulations are not doing their job. Some regulations are necessary for public health and safety and protection of the environment. But some overlap, some conflict with each other, some are arbitrarily enforced, some are targeted to other land uses and should not be - but nevertheless are - applied to agriculture, and some simply make no sense. Many also are not site-specific to the operations affected. Hence, they consume time and money, discourage innovation on the part of agriculturalists to come up with cost-effective solutions, and fuel a needlessly contentious relationship between agricultural operators and regulators, sometimes without delivering any benefit to society (again, see Excerpt #7 "The Problems With Regulations."). "In fact," Pat Cockrell of the Florida Farm Bureau Federation says, "agencies may have different requirements for the same project, i.e.: the water management district may require that a new greenhouse not  have a paved parking area while county building codes require a paved parking area."

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Regulatory agencies rarely provide adequate guidance. The current regulatory process is so complex, overwhelming and incomprehensible that the regulators who are responsible for it cannot - even with the best intentions:

find information quickly; determine which information applies to a specific case prior to initiating a lengthy permitting or review process; provide reliable estimates of the time, costs or outside expertise that an agricultural operator will require to comply with existing rules and requirements; or make distinctions between the rules and regulations that apply to agriculture and those that apply to other types of land use, other industries or other businesses.

As a result, the agricultural operator must enter the regulatory process:
	without the benefit of reliable guidance from regulators; and without knowing how long the process will take, how much it will cost or which experts must be consulted for assistance.

The result is similar to constructing a large municipal building without the benefit of a detailed architectural plan, without a building schedule, without a cost estimate, without a list of the building materials and supplies that will be required and, even worse, without a knowledgeable construction supervisor.

Far too many rules are written and too many regulators take action without an adequate understanding of agriculture or the implications that these rules and actions have on agriculture.
Regulations create an enormous burden, but do not always have a clear benefit. Every farmer interviewed during a study on the impact of regulations:
	was frustrated or angry about today's regulatory climate; experienced lengthy (and, they contend, unnecessary) delays in obtaining permits and permit renewals for specific aspects of their operations; lost money as a result of delays; and was required to spend money on procedures that:
		were not understandable,   were unnecessary, or   did not apply to their operation   and for which the farmers could not see any appreciable benefit to public health, safety or the environment.

Laws that strive for certainty do not always act as a good guide for action. According to Philip Howard: Once the idea is to cover every situation explicitly, the words of law expand like floodwaters that have broken through a dike. Rules elaborate on prior rules; detail breeds greater detail. There is no logical stopping point in the quest for certainty. And he adds: The drive for certainty has destroyed, not enhanced, law's ability to act as a guide.  As Mike Hennessy, a Hillsborough County nurseryman, says: It's a never ending process to understand what's going on. Then the agencies change the rules and you have to learn everything all over again. Richard Neill and his brother, David, concur, saying: "We would like to add the following: "There is a basic attitude problem existing in the agencies with whom we have dealt. Instead of a cooperative Îlet us help you do a good jobâ type of approach, the agencies with which we have dealt seize upon every opportunity to threaten $10,000 per day fines and other retribution if you do not accept their every demand. "The agencies seem intent upon causing farmers to expend a lot of funds on engineering that is unnecessary and serves no useful purpose. Even applications prepared by experienced engineers are never approved on the first effort. They are invariably returned with a checklist of 50 or 60 items to be re-done. "The agencies have total disrespect for legislative exemptions in favor of agriculture. For instance, the exemption granted to agriculture is generally ignored by the agencies such as South Florida Water Management District. The cost of litigation is such that most owners will not consider that as an alternative."

Strict regulation of agriculture may accelerate urbanization. In written comments to this paper submitted January 26, 2000, the Florida Department of Community Affairs (DCA) said: "We recommend more specific examples of regulations thought to be excessive or conflicting. Including these examples will improve the clarity of the document and illuminate the nature of the problem." Response: Please see Excerpt #7 "The Problems With Regulations" where more specific examples from the Hillsborough County study are cited.

DCA went on to say: "From a lay perspective there are several conflicting positions in the report which should be clarified. For example, the desire for protection (presumably through the enforcement of regulations) from imported diseases, pests and exotic plants is expressed on the one hand, but relief from the regulation, on the other. We suggest the report be extremely clear on these issues in order to avoid criticism." Response: Good point. Suggestions on how to clarify any seemingly conflicting positions are welcome. Perhaps this can be done through Excerpt #7 "The Problems With Regulations" and Priority Action 1, below. As noted under Priority Action 1, "... the purpose of changes is to simplify the current regulatory process, not avoid or weaken laws, rules or regulations."  Dick March, an economist with South Florida Water Management District, also said: "the water management districts' permitting activities should be discussed more ... The recent revisions to SFWMD's permit fees made major efforts to accommodate agriculture and were, in fact, endorsed by the District's Agricultural Advisory Committee. The District is moving toward 20 year [permits] in many areas. The report needs more examples of successful co-operation between agriculture and regulatory agencies." Response: Points well taken. These are all moves in the right direction. The suggestion for examples of successful cooperation is important. As noted previously, there are success stories. There are efforts underway to improve the regulatory environment. There are people in government who care. These positive efforts need to be mentioned – and encouraged. Still, as Appendix C points out, there is room for improvement.

Other obstacles include:

  Agriculture is segregated from all other business activities.

  Agriculture is not integrated into mainstream economic development/business development efforts

Agriculturalists maintain a deep skepticism toward most government actions - even those that are intended to "help" agriculture. Past experience has been bitter. People in government change. Programs come and go and are modified with simple majority votes. Also, far too many programs - including those billed as "good" for agriculture - are designed and carried out without consulting agriculture and without taking the effects on agriculture into consideration.

Farmers are becoming more scarce, and that means that when new conflicts arise, the community is composed more and more of people who do not understand agriculture and are less likely to be sympathetic to the farmer's point of view.   There are no inducements for recruiting suppliers, wholesalers and industries built on local agriculture, and industries that can process, manufacture and produce ready-for-market products from agricultural commodities produced in the Caribbean Basin and other off-shore locations.   Local suppliers, services and consultants are disappearing as agricultural activities begin to consolidate and diminish in the face of increased urbanization, raising costs of production and operation.

Financial markets do not encourage investment and growth in  agriculture. Farming is becoming information and capital intensive. Public policies that discourage investment in farming or increase financial risks cripples necessary investment   Agriculture operates on a different time scale than the rest of society. Many capital investments and business decisions require a 10-, 15- or even 20-year period to become fully vested and make a reasonable return on investment. Changes in regulations and policies, increased competition for land and water, rising real estate values, loss of chemicals, increases in operating costs and other changes that occur every year, three years or five years all create a climate of instability that undermines agriculture's ability to remain profitable and operate in a climate conducive to continued investment and planning.

The structure of agriculture, the way agriculture operates, the challenges faced by agriculture and the commodities produced by agriculture vary from county to county. Broad brush, one-size-fits-all approaches that ignore these differences can handicap - or even imperil - the productivity and viability of agricultural businesses.