USDA’s Farm Service Agency makes loans to family farms that are categorically exempt (“CatEx”) from the National Environmental Policy Act (“NEPA”), which permits agencies to make such exemptions.

Since 2016, the FSA has extended that exemption for loan actions to medium-sized “concentrated animal feeding operations” (“CAFOs”).

But in a “down in the weeds” ruling, a federal court has ordered FSA to again assess the environmental impact of medium-sized CAFOs before extending them credit.

“Plaintiffs argue that this rule was arbitrary and/or capricious and should be vacated pending remand. Defendants agree that the rule is procedurally infirm, but argue that the agency error was so minor that the Court should remand the rule to the agency without vacating it,” Federal District Judge Colleen Kollar-Kotelly said in her ruling.

She said the court “concludes that the Plaintiffs have the better of the argument and, upon consideration of the pleadings, the relevant legal authorities, and the entire record.” She denied FSA’s motion for Voluntary Remand and granted the Plaintiffs’ Cross-Motion for Summary Judgment.

Plaintiffs are led by Dakota Rural Action.

The judge’s ruling explains that: “Here, FSA concluded that it need not employ any environmental analysis before taking certain loan actions to benefit medium-sized CAFOs. CAFOs are industrial operations that raise animals for harvest, including slaughter.”

“These businesses, some of which are family-owned, “raise animals in a confined situation for a total of 45 days or more during a 12-month period and bring feed to the animals rather than having the animals graze or seek feed in pastures and fields or on rangeland.” Id. “The byproducts of these operations may have environmental consequences.” the ruling continues “Among other things, FSA provides certain loan services to CAFOs.  At issue here are loans to ‘medium’ CAFOs, which ‘stable or confine’ (1) ‘200 to 699 mature dairy cows, whether milked or dry;’ (2) ‘300 to 999 veal calves;’ (3) ‘300 to 99 cattle,’ and (4) ‘37,500 to 124,999 chickens;’ among other categories of animals.”

The ruling by the D.C. district judge makes no mention of the economic impact, including shortages and price increases that might result from the newly added environmental hurdles.

“Today in a victory for rural community, sustainable agriculture, and animal welfare groups, the United States District Court for the District of Columbia ruled that the United States Department of Agriculture’s Farm Service Agency (FSA) must assess the environmental impact of medium-sized concentrated animal feeding operations (CAFOs) before extending loans to them.” the Public Justice Food Project’s victory statement said.

In 2016, the FSA passed a rule exempting medium-sized CAFOs, also known as factory farms, from the environmental impact review and community feedback process typically required before offering taxpayer-subsidized loans to such facilities. This carveout harmed communities living near such “medium-sized” CAFOs, which are industrial livestock facilities that can confine up to 125,000 chickens, 55,000 turkeys, 2,500 pigs, 1,000 beef cattle, or 700 dairy cows, subjecting neighboring communities to pervasive odors, noxious gasses, polluted waterways, and more, according to advocates for controls.

A coalition of groups sued USDA in 2019 for failing to provide adequate public notice or evidence-based justification for the exemption. The Plaintiffs argued that USDA violated the National Environmental Policy Act and Administrative Procedure Act.

They claimed USDA arbitrarily exempted major polluters from government oversight, and that medium-sized CAFOs must be subjected to the same oversight as large ones before receiving public funds.

Animal Legal Defense Fund, Association of Irritated Residents, Citizens Action Coalition, Iowa Citizens for Community Improvement, the Institute for Agriculture and Trade Policy, and Food & Water Watch are represented by ALDF.

Public Justice, Food & Water Watch, Dakota Rural Action and White River Waterkeeper are represented by Public Justice and Food & Water Watch.

“Our government has a duty to protect and invest in the health and wellbeing of people, our air, our water, and climate,” said Co-Chair of Dakota Rural Action Stacy Roberts, “Instead of propping up Big Ag, our government should invest in diversifying and strengthening a food system that supports independent family farmers, contributes to local communities, and heals the land, air, and water.”