USDA’s 2021 Readiness Grants and Custom-Exempt Meat-Processing in Florida

COVID shed light on serious supply chain issues around the globe. The ease of disease-spread in large warehouse facilities meant massive production delays. For agribusinesses especially, this was most felt in the meat-processing industry. Meat processing plants across the nation faced with waves of infection among workers and government actions aimed at stemming the tides, were forced to close or severely reduce operations. As a result, processing became backlogged, farmers’ livestock became too large to sell commercially, and customers have seen rising meat prices as a result.

This article focuses on one possible solution to this large-scale agriculture issue likely to continue for the foreseeable future: the development of more custom-exempt facilities–small-scale slaughterhouses that can only process meat on behalf of the livestock owner(s) or family members.

Federal and Florida Regulation of Custom-Exempt Operations

That’s because, generally speaking, it’s illegal for farmers who want to sell their beef, pork or poultry to slaughter their livestock for sale without a “grant of inspection” from a federal or state agency. There are four types in total — full federal, state level, custom-exempt and retail exempt. You can be one or a set of these depending on your operation.

Custom-exempt operations are particularly appealing because the application process is much less burdensome. The clientele is limited, however. Custom-exempt operators service livestock farmers with one or multiple customers looking to buy and split the animal, or seasonal hunters looking for game to be slaughtered. They can also act as middlemen who purchases the livestock from the farmer as a representative of the final owner.  Further, retail sales are not allowed (products must be labelled “Not for Sale”), and they can’t sell across state lines.

While custom-exempt operators are spared the “full” federal inspection, they must still apply to the USDA, which has the right to inspect the facility during harvest (typically once or twice a year) to make sure the livestock is processed in a “sanitary manner.”  These inspections mean maintaining up-to-date records related to sewage and waste (specifically identifying high risk material like the brain if you’re dealing with beef), chemical and water safety generally. Animals slaughtered must also be ambulatory, so that should be recorded as well. Also keep in mind that poultry, beef and pork may have their own set of processing rules.

In Florida, custom-exempt operators are spared a state-wide slaughterhouse application process. The state, as well as county and local governments, still have general sanitation, zoning and animal cruelty requirements for these types of facilities though (see generally, Florida’s Humane Slaughter Act62-302 F.A.C.Hillsborough County Code Sec. Sec. 6.11.91, City of Jacksonville Code of Ordinances Sec. 462.901, 460.106).

Starting and Growing a Custom-Exempt Operation

Overall, the industry issues COVID highlighted may have some livestock farmers considering a custom-exempt slaughterhouse on-site, since it’s generally considered the least cost prohibitive. However, the startup expense is still typically in the seven-figure range between the space needed, the construction, and some of the state and local provisions listed above with their own inspection and application costs.

On the heels of these issues, however, the USDA recently announced new Meat and Poultry Inspection Readiness Grants for existing exempt slaughterhouses (see the application packet here) to use up to $200k toward obtaining a higher inspection level. As a top meat-producing state, and with more farm-to-table-minded consumers exploring alternatives (if you’re one, start at this list of custom-exempt facilities!), Florida agribusinesses may be able to capitalize on this local focus and contribute to a much needed revamp of the industry.

Considering a Custom-Exempt Operation or Have General Questions? Let’s chat. Contact us at contact@groveslaw.ag to schedule a consultation.

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Kara Groves

After earning her law degree from University of Florida Levin College of Law and working as a tort defense litigator, Kara is settling down and bought some acreage out in Mount Dora. She has returned to her sustainable, regulatory background to help farmers and locally-focused businesses innovate and capitalize on direct-to-consumer movements across the state. In her off time, Kara is an avid gardener and cook. You’ll often find her in downtown Mount Dora adding to her plant collection or taking client meetings in the local brewery and marketplace.

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