TWIN FALLS — Government regulations cost the baitfish and sport-fish industry — a relatively small industry — $12.1 million annually.

But a retired economist says many of the regulations are unnecessary or redundant.

Regulation compliance makes up about 25 percent of each farm’s total cost, said Carole Engle, who studied the issue. Moreover, the cost is not productive.

Feed, for example, often accounts for 50 to 60 percent of a fish farm’s total costs, but that cost is converted into pounds, which farmers can sell. Filling out paperwork or collecting water samples does not produce additional pounds to market.

For years, farmers have complained that the burden associated with aquaculture regulations has been onerous but no one has had any proof to take to regulators or lawmakers — until now. After Engle retired from the University of Arkansas she established a consulting business to work on those questions.

The USDA Animal and Plant Health Inspection Service was initially interested in determining how regulations impact baitfish and sport-fish farms which ship live fish all over the nation. Recreational trout were excluded from the first study, but Engle is using lessons learned from both the baitfish study and another examining the shellfish industry to develop a trout survey. She hopes to begin collecting data this fall from trout farmers in Idaho and other key production regions.

“People want it done,” she said. “People are hungry for the data.”

In addition to APHIS, Engle has also received funding from the Western Regional Aquaculture Center and U.S. Trout Farmers Association. She spoke at the Idaho Aquaculture Association meeting earlier this month.

Costs associated with regulations include time for complying records and completing forms as well as lost income from closed markets. “It’s really sobering,” she said.

Many states have enacted regulations that ban certain species such as tadpoles or crawfish. Just one tadpole, for example, on a 18-wheeler of fish going into a state that has banned the species puts the load in violation of the Lacey Act and subjects the farm to fines and lost markets.

Farmers often react to higher fixed costs by increasing production. But for fish farmers, many regulations also restrict production. That’s particularly true in Idaho where National Pollutant Discharge Elimination System (NPDES) permits and water-right restrictions can limit the number of fish in a raceway. The baitfish survey showed a significant relationship between regulations and inefficient production.

Paying for permits is the primary cost of regulation on a baitfish farm but fines can also quickly add up. Insurance costs related to regulations were higher than Engle had expected. She ticked off several areas where farmers use insurance to mitigate risks: fines, water restrictions and worker injuries.

Even though Engle has completed just one survey so far, regulators appear to be listening to the results. APHIS has been considering new federal uniform standards for fish health. The agency was concerned about additional costs to producers, but based on the results of the baitfish survey, standardizing regulations across all 50 states could cut costs by half.

Some states require 56 fish be tested for certain diseases, while other states require 27 fish. Some producers are required to test fish twice a year for diseases that have never been found within the state.

Not only do laboratories charge lab fees on a per fish basis, but farmers must also prep a pond in advance of the veterinarian’s visit to sample the fish. Time spent with the veterinarian and doing the required paperwork all take time away from marketing fish.

One of the take home messages from the baitfish survey is the need to create lists of redundancies among regulations. One baitfish producer reported needing to renew 203 different permits annually.

Nearly 80 percent of the regulatory costs reported by the baitfish industry resulted from state regulations. Streamlining applications so that the same sampling and records could be used for both the state agriculture and natural resources departments, for example, would generate real savings for producers. Having multiple state agencies issue permits for the same activity not only wastes time and money for producers, but requires resources that the state could use for other activities.

“We’re not talking about doing things that are harmful but reducing redundancies,” Engle said. “Too much redundancy is hurting business and hurting states as well.”

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