S.F. _____ Section 1. Section 459.301, subsection 3, Code 2013, is 1 amended to read as follows: 2 3. In calculating the animal unit capacity of a confinement 3 feeding operation, the animal unit capacity shall include the 4 animal unit capacity of all confinement feeding operation 5 buildings which are part of the confinement feeding operation, 6 unless a confinement feeding operation building has been 7 abandoned as provided in section 459.201 that are used to house 8 animals . 9 Sec. 2. NEW SECTION . 459.312A Election to be a small animal 10 feeding operation. 11 A person otherwise required to submit an updated manure 12 management plan as required in section 459.312 and pay an 13 annual compliance fee as required in section 459.400 may make 14 a small animal feeding operation election as provided in this 15 section. 16 1. Upon the effective date of the election, the confinement 17 feeding operation covered by the updated manure management 18 plan shall be considered a small animal feeding operation only 19 for purposes of submitting the updated manure management plan 20 and paying the annual compliance fee, during the period of the 21 election. 22 2. A person is eligible to make an election only if all of 23 the following apply: 24 a. Five hundred or fewer animal units are housed at the 25 confinement feeding operation at any one time during the period 26 of election. 27 b. The department is notified of the election in a manner 28 required by the department. The department may require that a 29 person submit a notice of election as part of an updated manure 30 management plan form or as a separate document. 31 3. The department shall provide for the period of election, 32 including its effective and expiration dates. However, the 33 period of election shall be at least for the same period 34 covered by the updated manure management plan. An election 35 -1- LSB 1480SC (6) 85 da/sc 1/ 4

S.F. _____ automatically terminates when more than five hundred animal 1 units are housed at the confinement feeding operation at any 2 one time. 3 4. This section does not affect any of the following: 4 a. A condition associated with a construction permit as 5 provided in this subchapter, including but not limited to a 6 master matrix as provided in section 459.305. 7 b. A requirement unrelated to filing an updated manure 8 management plan or paying an annual compliance fee, including 9 but not limited to the filing of a construction design 10 statement as provided in section 459.306, the application of 11 manure as provided in section 459.313A, or the certification of 12 a person as a confinement site manure applicator as provided 13 in section 459.315. 14 Sec. 3. Section 459.400, subsection 1, paragraph c, Code 15 2013, is amended to read as follows: 16 c. An annual compliance fee that is required to accompany an 17 updated manure management plan submitted to the department for 18 approval as provided in section 459.312 . 19 (1) The amount of the annual compliance fee shall not exceed 20 a rate of fifteen cents per animal unit based on the multiplied 21 by the maximum number of animal unit capacity of units housed 22 at the confinement feeding operation during the period covered 23 by the manure management plan. 24 (2) If the person submitting the manure management plan is 25 a contract producer, as provided in chapter 202 , the active 26 contractor shall be assessed the annual compliance fee. 27 EXPLANATION 28 BACKGROUND. The department of natural resources 29 (department) is required to regulate confinement feeding 30 operations (operations) under Code chapter 459, the “Animal 31 Agriculture Compliance Act”. This bill amends provisions in 32 subchapter III which govern water quality, including how and 33 when manure from such operations is to be applied to land. 34 CURRENT ANIMAL UNIT CAPACITY FORMULA TO DETERMINE AN 35 -2- LSB 1480SC (6) 85 da/sc 2/ 4

S.F. _____ OPERATION’S SIZE. To some extent, the degree of regulation 1 depends upon an operation’s size which is determined by 2 calculating its animal unit capacity; the maximum number 3 of animal units that may be maintained in all confinement 4 buildings (buildings) at any one time (Code section 459.102). 5 Each of various types of animals are assigned a special 6 equivalency factor. For example, a butcher or breeding swine 7 weighing more than 55 pounds has a factor of 0.4 animal units 8 (Code section 459.102). Generally, when calculating the animal 9 unit capacity of an operation, buildings constructed as part 10 of the operation are included regardless of whether they are 11 occupied, except if a building has been abandoned, i.e., has 12 been razed or converted to another use (Code section 459.301). 13 SMALL ANIMAL FEEDING OPERATIONS. The current law provides 14 a special regulatory exemption for small animal feeding 15 operations, which have an animal unit capacity of 500 or fewer 16 animal units (Code section 459.102). In the example above, a 17 confinement feeding operation with three buildings keeping a 18 maximum of 400 swine in each of two buildings and no animals in 19 the third building would not qualify as a small animal feeding 20 operation if the capacity of the three buildings were 600, 500, 21 and 300 animal units, respectively (1,400 x 0.4 = 560). 22 REVISING CURRENT FORMULA —— CALCULATING CONFINEMENT ANIMAL 23 UNIT CAPACITY BASED ON USED AND UNUSED BUILDINGS. This bill 24 revises the current formula by excluding any building that is 25 not occupied regardless of whether it is abandoned. This is 26 the same formula used to calculate the animal unit capacity of 27 dry-bedded confinement feeding operations using so-called “hoop 28 buildings” (Code section 459B.103). In the example above, the 29 confinement feeding would qualify as a small animal feeding 30 operation since the third empty building is no longer counted 31 (1,100 x 0.4 = 440). 32 NEW FORMULA —— RECLASSIFYING CONFINEMENT FEEDING OPERATIONS 33 BASED ON MAXIMUM NUMBER OF ANIMAL UNITS. The bill allows a 34 person to elect to be exempt from filing a manure management 35 -3- LSB 1480SC (6) 85 da/sc 3/ 4

S.F. _____ plan update (update) with the department and paying an 1 associated annual compliance fee (fee) if the person can 2 reclassify the operation as a small animal feeding operation 3 using the new formula. An update is required to be filed by a 4 person who owns a confinement feeding operation or who applies 5 manure from a confinement feeding operation located outside 6 the state (Code section 459.312). Both the original plan 7 and the update must include the latest information regarding 8 manure application. Using the example above, the operation 9 could elect to be exempt as a small animal feeding operation 10 (800 x 0.4 = 320). The bill provides that the department 11 must determine the period of election so long as the minimum 12 election period equals the duration of the updated plan. 13 However, the election period automatically terminates if 14 the operation no longer qualifies as a small animal feeding 15 operation as calculated using the new formula. 16 NEW FORMULA —— ANNUAL COMPLIANCE FEE. The bill provides 17 that a person must now calculate the fee accompanying the 18 update by applying the new formula. Using the example above, 19 if the operation were not exempted as a small animal feeding 20 operation, the person who would have paid a fee of $84 (560 x 15 21 cents) under the current formula would pay $48 (320 x 15 cents) 22 under the new formula. 23 CIVIL PENALTIES. A person who violates Code chapter 468, 24 subchapter III is subject to a civil penalty. The department 25 is authorized to impose a range of civil penalties based 26 on a number of criteria. The general civil penalty cannot 27 exceed $10,000 (Code sections 459.603 and 455B.109). A 28 person violating a provision is also subject to judicial 29 action brought by the attorney general (Code sections 459.603 30 and 455B.191). The general civil penalty applicable for a 31 violation cannot exceed $5,000. 32 -4- LSB 1480SC (6) 85 da/sc 4/ 4