Farmer urges clearer language in S.118 to protect small value‑added farm businesses

Paul Ralston, president of Little Village Enterprise, told the Agriculture Committee that language in S.118 restricting accessory on‑farm food processing would be difficult for small vegetable farms to comply with and enforce.

Ralston said the amendment, found on page 15 of S.118, would require that no more than 50% of the sales of a processed farm product come from ingredients grown off the producing farm. He called that measure hard to interpret and enforce and said it could prevent farmers who invest in processing equipment from using purchased ingredients when their own crops fail. "We donated 27,000 somewhat pounds of vegetables," Ralston said, describing his farm's donations to food shelves and shelters and the practical scale of his operation.

Why it matters: Committee members and farmers told the panel the 50% sales test could block small farms from moving into higher‑value, direct‑to‑consumer markets such as soups or tomato sauce, especially after weather losses. Ralston and committee members said the current wording risks excluding legitimate small enterprises while trying to block large industrial operations.

Ralston outlined two concrete changes he said would be more workable. First, replace the 50% sales metric with an absolute annual sales cap for accessory value‑added operations; he suggested $250,000 as a threshold that would still capture small businesses while preventing industrial-scale operations. "A really, knowable guardrail would be a dollar figure," he said. He recommended indexing that figure for inflation so it "goes up as we go gain in years."

Second, Ralston asked the committee to allow donated farm products to count toward the statutory sales test that defines a farm. He noted some small farms have no commercial sales because they donate most produce; the suggested change would treat "the equivalent of donated farm products" as meeting a $2,000 sales threshold used in other farm definitions.

Ralston used a tomato sauce example to explain the enforcement problem: under the amendment as drafted, producers would need to track the share of each ingredient that originated on their farm and calculate that against finished‑product sales, something he called "almost impossible to calibrate, to measure." He also raised the risk that a farmer who invests in processing equipment could lose a season to blight or flood and be unable to use purchased inputs under the current language.

Committee members responded that they want clear statutory language. The committee chair said, "If you could make something very clear to us about how we could do this, we could possibly, I'm gonna say possibly, tack that on" to a miscellaneous bill the committee is preparing. Committee members asked Ralston to provide proposed language and discussed consulting staff member Michael O'Grady to draft a concrete amendment.

No formal vote or motion was recorded on S.118 during the discussion. Committee members said they were hesitant to move broader changes inside S.118 without clearer drafting; they offered either to add a narrowly written amendment to the current miscellaneous bill or to take up the issue in the next biennium.

The committee heard that small vegetable farms are already coping with storm damage, invasive pests, and unpredictable weather patterns that make year‑to‑year production variable. Ralston urged rules that enable small farms to use neighbor‑sourced inputs and donated product to remain viable when their own harvests fail.

Next steps: Committee members asked Ralston to submit proposed statutory language for review and said staff would work with him and Michael O'Grady. They did not set a date for any formal amendment or vote.