The preference helps Washington's dairies comply with the Dairy
Nutrient Management Act. It is unclear if the preference has helped to improve water
quality in Washington.
July 2020
Sales and use tax exemption for certain equipment that is used to manage
manure
Dairies and animal feeding operations do not pay sales or use tax when they
purchase certain equipment that is used exclusively to manage livestock
nutrients (i.e., manure). Services to maintain or repair qualifying equipment
or facilities are also tax-exempt.
The preference is available only for certain qualifying equipment and
facilities that are detailed in statute.
The preference took effect July 13, 2001, and does not have an expiration
date.
Preference helps dairies comply with the Dairy Nutrient Management Act. It is
unclear if the preference has helped to improve water quality in Washington.
The 1998 Dairy Nutrient Management Act requires dairies to develop and implement
nutrient management plans to manage their livestock manure. The goal of the plans is
to protect surface and ground water. When the Legislature passed this preference, it
stated that it was intended to help dairy farmers comply with the Act. The
preference was later extended to animal feeding operations.
Objectives
Results
Help dairies comply with the Dairy Nutrient Management Act.
Met. The preference reduces costs for dairies to purchase or repair
qualifying nutrient management equipment and facilities, which helps them
comply with the Act. The compliance rate for establishing nutrient management
plans has increased from 82% in 2006 to 97% in 2019.
Maintain and improve water quality in Washington.
Unclear. In areas with large concentrations of dairies, water quality
has primarily remained within the moderate range since 2001. However, it is
unclear to what extent the preference has influenced those levels.
Recommendations
Legislative Auditor's Recommendation: Continue
The Legislature should continue the preference because it is helping dairies
and animal feeding operations implement their nutrient management plans. The
preference is one of many efforts to help maintain and improve water quality in
Washington.
If the Legislature wants more accurate information on the size of the beneficiary
savings, it should require the Department of Revenue to collect data on qualifying
sales.
1. Tax exemption for equipment and facilities used to manage manure
Sales and use tax exemption to help dairies and animal feeding
operations maintain nutrient management plans and protect Washington's water
quality
Dairies and animal feeding operations do not pay sales or use tax when they
purchase:
Certain equipment used exclusively to manage livestock nutrients (i.e., manure).
Services to maintain or repair qualifying nutrient management equipment and
existing facilities.
The 1998 Dairy Nutrient Management Act requires dairies to have nutrient management
plans in order to protect water quality
The Dairy Nutrient Management Act requires dairies to have plans
that demonstrate how they will efficiently and effectively manage livestock manure in
order to protect surface and ground water.
Non-dairy animal feeding operations (AFOs) may elect to develop
nutrient management plans, but they are not required to do so.
Dairies and other animal feeding operations qualify for the preference
The following animal-based operations are eligible for the preference:
Animal feeding operations (AFOs) with a state waste permit or with a nutrient
management plan approved by a conservation district. An AFO is a facility
where animals have been, are, or will be confined and fed, or kept for 45 or more
days in a 12-month period. AFOs have no crops, vegetation, or post harvest residue
during the normal growing season at the facility or where the animals are confined.
These facilities can include cattle, poultry, or pig operations.
Preference available only for equipment and facilities listed in statute
The preference applies only to equipment and facilities that are used exclusively to
handle and treat livestock manure. Qualifying equipment and facilities are listed in
statute and include items such as pumps, scrapers, manure spreaders, and lagoon or
pond liners. See Appendix
A for a full list of eligible equipment and facilities.
Preference has no expiration date
The preference took effect July 13, 2001, and originally only applied to dairies. It
was extended to apply to non-dairy, livestock AFOs in 2006. The Legislature suspended
the preference from July 1, 2010, through June 30, 2013. The preference currently has
no expiration date.
JLARC is also reviewing a sales and use tax exemption for anaerobic digesters in
2020
The Legislature enacted a sales and use tax exemption for dairies that purchase
anaerobic digesters in the same 2001 legislation that established the livestock
nutrient management preference. JLARC staff are reviewing the anaerobic digester
preference in a separate 2020 report.
2. Laws and plans are intended to protect water quality
Livestock nutrient management plans are intended to help dairies
and livestock operations properly manage their manure and protect ground and surface
waters
The Dairy Nutrient Management Act requires dairies to manage their livestock manure
in order to protect the quality of surface and ground water. Non-dairy animal feeding
operations (AFOs) may elect to do so, but are not required to under the Act.
1998 Dairy Nutrient Management Act established to protect water quality
The Dairy Nutrient Management Act requires dairies to have nutrient management plans.
The plans cover all aspects of the operation, including manure production, collection,
storage, treatment, and use. The goal is to determine how and when to apply nutrients
to achieve balance between the nutrient needs of the property and the protection of
ground and surface waters.
Dairies and some AFOs develop individualized livestock nutrient management plans
Dairies and some AFOs develop nutrient management plans to handle and use the
livestock manure and byproducts, such as fertilizer and bedding, generated at their
facilities. By following these plans, they can prevent water pollution coming from
their properties.
Plan activities include:
Collecting, storing, moving, and transporting manure.
Separating manure solids from liquids.
Applying manure to agricultural lands at times that are most appropriate for
protecting water quality. For example, manure should not be applied before a heavy
rainstorm or in amounts that exceed the nutrient needs of existing crops.
The Act is administered by the Washington State Department of Agriculture (WSDA) and
requires all licensed dairies to:
Develop and implement individualized nutrient management plans.
Register with the WSDA.
Receive regular inspections from the WSDA to ensure they are following plan
requirements.
Comply with laws and rules protecting surface and ground water.
Conservation districts provide planning assistance to dairies and AFOs
Washington has 45 conservation districts throughout the state to help landowners
manage their properties responsibly for ecological purposes. Staff from local
conservation districts help dairies and AFOs design, fund, and implement their
nutrient management plans. Each plan is individually developed to meet site specific
conditions.
If any element of a dairy or AFO operation changes, conservation districts can help
them modify and update their plans. For instance, if a dairy adds more cows or loses
land that was available for manure application, the conservation district can help to
revise the plan.
An average sized cow produces many gallons of manure daily. The manure contains
nitrogen, phosphorus, and potassium which can be harmful to environmental and human
health in certain concentrations. Collecting and containing the manure, and planning
for proper nutrient application, helps to control the release of these elements and
protects the environment.
Exhibit 2.1: Managing manure is an ongoing process for dairies
Source: JLARC staff analysis of data provided by Whatcom Conservation District
staff.
323 licensed dairies in Washington as of January 2020
Milk products and cattle were ranked 2nd and 5th, respectively, among Washington's
top agricultural commodities in 2019. As of January 2020, Washington had 323 licensed
dairies. Because some dairies have multiple locations, the actual number of licensed
dairy locations is 343.
Exhibit 2.2: Washington dairies are located throughout the state
Source: JLARC staff analysis of Washington Department of Agriculture dairy geo-coded
data as of January 15, 2020.
38% of licensed Washington dairies are in Whatcom and Yakima Counties
While dairies are located throughout the state, Whatcom and Yakima counties have the
largest concentration of facilities. These two counties have very different climates,
landscapes, and soils which result in unique water and environmental concerns for each
area.
84 licensed dairies in Whatcom County
As of January 2020, 84 licensed dairies were operating in Whatcom County. These
dairies tend to be smaller in acreage and have fewer cows than dairies in Eastern
Washington. One-quarter of the dairies had 700 or more mature cows.
This area receives significant levels of rain in the winter and spring, making
nutrient management a challenge. Runoff from land surfaces generally flows into
streams and rivers that empty into inlets of the Puget Sound. These inlets are home to
recreational, commercial, and tribal (Lummi Nation) shellfish beds.
40 licensed dairies in Yakima County
Dairies in Eastern Washington tend to have more acreage and cows. As of January 2020,
83% of Yakima County's 40 dairies had 700 or more mature cows.
Although the climate is dry, conservation districts report that snowmelt during the
spring can create sudden surges of water. Nutrient management is critical for these
dairies because elevated nitrogen and phosphorus levels in the soil result in ongoing
water quality issues.
Detail on the number of animal feeding operations in Washington is not
available
Some large AFOsAnimal feeding
operations are facilities where animals are confined and fed, or kept for 45 or
more days in a 12-month period. They can include cattle, poultry, or pig
operations. are required to have state water discharge permits with
the Department of Ecology. Any AFO may elect to develop a nutrient management plan,
but these are developed with the assistance of local conservation districts and are
not tracked on a state-wide basis.
3. Preference reduces costs for dairies to manage their nutrients
Washington dairies and animal feeding operations will save an
estimated $266,000 to $1 million in 2021-23 biennium due to the preference
When the preference was enacted in 2001, the Dairy Nutrient Management Act required
Washington's dairies to have nutrient management plans in place by December 31, 2003.
Many dairies had to purchase equipment or services to implement their plans. The
Legislature specifically stated that the preference was intended to help dairies meet
the deadline and continue to comply with the Act in the future.
There is a wide range in costs for qualifying equipment and repairs
Industry representatives indicate that the preference is used for everyday purchases
as well as major expenditures, such as new equipment or expensive repairs. Each
beneficiary may spend anywhere from hundreds to tens of thousands of dollars or more
on qualifying equipment and services in a given year. The exemption can save them
about 8.3% - the average rural county sales tax rate - on their qualifying
purchases.
The list below includes examples of equipment commonly used in livestock nutrient
management and the estimated retail costs provided by vendors as of March 2020:
High volume pump (used to clean facilities and move manure).
New flush pump: $26,000.
Repair or spare parts kit: $9,700.
High pressure pump (used in ponds to spread and apply nutrients and other uses).
New floating pump: $18,200.
Repair/spare parts kit: $3,900.
Manure spreader or nutrient applicator (used to apply nutrients to fields).
Prices range between $56,000 to $312,000, depending on size and features.
Beneficiaries may save an estimated $266,000 to $1 million in 2021-23 biennium
It is difficult to estimate beneficiary savings because there is no specific
deduction classification for businesses to report use of this preference. JLARC staff
estimated a range of savings based on available data.
JLARC staff estimate the direct beneficiaries savings for fiscal year 2019 was
between $57,000 and $800,000. The estimated savings for the 2021-23 biennium is
between $266,000 to $1 million.
The lower end of the estimated range is based on actual qualifying sales data that
businesses reported as livestock nutrient-related purchases under an "other" deduction
category. At a minimum, beneficiaries saved at least the lowest amount of the
estimated range.
The higher end of the estimated range is based on the Department of Revenue's 2020
Tax Exemption Study. The actual beneficiary savings may be equal to or greater than
these estimates.
Exhibit 3.1: The estimated 2021-23 biennial savings is between $266,000 and $1
million
Biennium
Fiscal Year
Estimated Beneficiary Savings
2017-19
7/1/17-6/30/19
2018
$58,000 - $800,000
2019
$57,000 - $800,000
2019-2021
7/1/19 - 6/30/21
2020
$283,000 -$506,000
2021
$133,000 - $506,000
2021-23
7/1/21-6/30/23
2022
$133,000 - $506,000
2023
$133,000 - $506,000
2021-23 Biennium
$266,000 - $1 million
Source: Lower range: JLARC staff analysis of Department of Revenue tax return
deduction detail, July 2017 – December 2019. Higher range: JLARC staff analysis of
Department of Revenue estimate for tax preference value for 2020 Tax Exemption Study.
4. Percentage of dairies with approved plans has increased
The percentage of dairies with individual nutrient management
plans has increased from 82% in 2006 to 97% in 2019
The 1998 Dairy Nutrient Management Act requires dairies to establish and certify
their own nutrient management plans. Industry representatives indicate that the
preference encourages dairies and animal feeding operations (AFOs) to replace or
repair old or failing equipment used to manage manure.
Compliance rates have steadily improved outside of a three-year period when the
exemption was not in effect
Washington's Department of Agriculture (WSDA) provided dairy inspection data from
2006 through 2019. The data shows that the percentage of dairies with approved
nutrient management plans has increased over time, going from 82% to 97%. The one
exception is a three-year period of time when the preference was not in effect (July
1, 2010, through June 30, 2013). During this time, compliance rates dropped from 95%
to 86%.
The WSDA reports it is not authorized to enforce dairies' ongoing compliance with the
plans.
Exhibit 4.1: WSDA reports that 97% of Washington dairies have approved nutrient
management plans
Source: JLARC staff analysis of WSDA quarterly data, June 30, 2006, through
September 30, 2019. Per WSDA, data prior to 2006 was not available.
5. Unclear if preference has helped to improve water quality
Water quality has primarily remained within the "moderate" range
in areas with large concentrations of dairies. It is unclear to what extent the
preference has influenced those levels.
Water quality refers to the chemical, physical, and biological characteristics of the
water. It is often measured in terms of its suitability for a human purpose, such as
drinking or swimming.
Managing livestock nutrients is one of many efforts the state uses to protect ground
and surface waters.
Concerns with pollution levels in Portage Bay and the Nooksack River Watershed in
Whatcom County preceded the enactment of the Dairy Nutrient Management Act
Many Whatcom County dairies are located in the Nooksack River watershed, which
discharges into Bellingham Bay and Portage Bay. This area is home to the Lummi
Nation's primary commercial shellfish growing area.
In 1996, the Lummi shellfish beds were closed due to fecal coliform bacterial
pollution linked to dairy farms, as well as to septic issues and stormwater runoff.
Fecal coliform is a group of bacteria that comes from human and animal feces. It is
used as a primary indicator of water quality.
The closure of the Lummi shellfish beds encouraged the Legislature to enact the Dairy
Nutrient Management Act in 1998 to improve water quality in Whatcom County and
throughout the state. Since the late 1990s, state, federal, tribal, agricultural, and
community representatives have collaborated to improve water quality for this area.
The Lummi shellfish beds were fully reopened in 2006.
Increasing fecal coliform bacterial levels resulted in closure of the Lummi
shellfish beds in 2014.
In April 2019, the seasonal shellfish harvest ban was lifted for all but the fall
season (October through December) for 800 acres in Portage Bay.
Long-term data indicates that average fecal coliform bacteria
levelsA group of bacteria that comes from human and
animal feces. in the Nooksack River have fluctuated both above and
within the established target zone since 1999. From 2015 on, the fecal coliform
concentration has remained within the target zone.
Exhibit 5.1: Nooksack River fecal coliform levels have fluctuated but are currently
within the target zone
Source: JLARC staff analysis of mean fecal coliform bacterial levels in Nooksack
River mainstem at Marine Drive, as provided by Whatcom County Conservation District,
December 2019.
Conservation District staff report that the tax preference is one tool among many
used to maintain and improve water quality
Whatcom Conservation District staff note that improving water quality involves a
combination of efforts and tools. They report that the tax preference is one piece
among many. Examples of other efforts specific to working with Whatcom County dairies
and other nutrient producers include:
A text alert system that provides detail from the National Oceanic and Atmospheric
Administration on timing nutrient application based on weather event
forecasting.
Manure spreading advisories that give 24- to 72-hour detail on risks associated
with applying nutrients.
Instances of local legally binding water quality improvement plans, such as the
one included in a November 2017 agreement between the Lummi Nation and seven
individual dairies.
Water quality has primarily remained in "moderate" range in areas with high
concentrations of dairies
The Department of Ecology (DOE) maintains long-term river and stream water quality
monitoring at locations throughout the state. It monitors and rates water quality
based on eight elements, including temperature, dissolved oxygen, fecal coliform
bacteria, nitrogen, and turbidity.
DOE conducts ongoing river and stream monitoring at limited locations in the
state
DOE staff identified monitoring stations with data starting in 1997 for three areas
of the state with high concentrations of dairies:
Northwest Washington on the Nooksack, Skagit, Stillaguamish, and Snohomish
Rivers.
Puget Sound/Southwest Washington on the Puyallup, Chehalis, and Willapa
Rivers.
Eastern Washington on the Yakima River and Crab Creek.
Exhibit 5.2: Department of Ecology monitors water quality in areas with
concentrations of dairies
Source: JLARC staff analysis of Washington Department of Agriculture dairy locations
as of January 15, 2020, and Department of Ecology long-term water quality monitoring
sites.
Long-term water quality data varies but primarily remains in "moderate" range for
areas with dairy concentrations
The graphics below reflect long term water quality levels in the three areas with
concentrations of dairies. The Department of Ecology categorizes the water quality
into three general classifications: Good, moderate, and poor. Since 1997, the water
quality in all of the rivers and streams has been in the moderate or good range.
Exhibit 5.3: Northwest Washington rivers
Source: JLARC staff analysis of Department of Ecology long-term river monitoring
data.
Exhibit 5.4: Puget Sound and Southwest Washington rivers
Source: JLARC staff analysis of Department of Ecology long-term river monitoring
data.
Exhibit 5.5: Eastern Washington rivers and streams
Source: JLARC staff analysis of Department of Ecology long-term river monitoring
data.
Unclear to what extent the preference has influenced water quality
Because many factors impact water quality, it is not clear to what extent the
preference has influenced the changes in water quality over time. The preference is
one piece of a broad effort to reduce pollution in Washington's ground and surface
waters.
RCW 82.08.890, RCW 82.12.890, RCW 90.64.005, and RCW
90.64.026
Exemptions-Qualifying livestock nutrient management equipment and facilities.
RCW 82.08.890
(1) The tax levied by RCW 82.08.020 does not apply to sales to eligible persons
of:
(a) Qualifying livestock nutrient management equipment;
(b) Labor and services rendered in respect to installing, repairing, cleaning,
altering, or improving qualifying livestock nutrient management equipment; and
(c)(i) Labor and services rendered in respect to repairing, cleaning, altering, or
improving of qualifying livestock nutrient management facilities, or to tangible
personal property that becomes an ingredient or component of qualifying livestock
nutrient management facilities in the course of repairing, cleaning, altering, or
improving of such facilities.
(ii) The exemption provided in this subsection (1)(c) does not apply to the sale of
or charge made for: (A) Labor and services rendered in respect to the constructing of
new, or replacing previously existing, qualifying livestock nutrient management
facilities; or (B) tangible personal property that becomes an ingredient or component
of qualifying livestock nutrient management facilities during the course of
constructing new, or replacing previously existing, qualifying livestock nutrient
management facilities.
(2) The exemption provided in subsection (1) of this section applies to sales made
after the livestock nutrient management plan is: (a) Certified under chapter 90.64
RCW; (b) approved as part of the permit issued under chapter 90.48 RCW; or (c)
approved as required under subsection (4)(c)(iii) of this section.
(3)(a) The department of agriculture must provide a list of eligible persons, as
defined in subsection (4)(c)(i) and (ii) of this section, to the department of revenue
upon request. Conservation districts must maintain lists of eligible persons as
defined in subsection (4)(c)(iii) of this section to allow the department of revenue
to verify eligibility.
(b) A purchaser claiming an exemption under this section must keep records necessary
for the department to verify eligibility under this section. Sellers making tax-exempt
sales under this section must obtain an exemption certificate from the purchaser in a
form and manner prescribed by the department. In lieu of an exemption certificate, a
seller may capture the relevant data elements as allowed under the streamlined sales
and use tax agreement. The seller must retain a copy of the certificate or the data
elements for the seller's files.
(4) The definitions in this subsection apply to this section and RCW 82.12.890 unless
the context clearly requires otherwise:
(a) "Animal feeding operation" means a lot or facility, other than an aquatic animal
production facility, where the following conditions are met:
(i) Animals, other than aquatic animals, have been, are, or will be stabled or
confined and fed or maintained for a total of forty-five days or more in any
twelve-month period; and
(ii) Crops, vegetation, forage growth, or postharvest residues are not sustained in
the normal growing season over any portion of the lot or facility.
(b) "Conservation district" means a subdivision of state government organized under
chapter 89.08 RCW.
(c) "Eligible person" means a person: (i) Licensed to produce milk under chapter
15.36 RCW who has a certified dairy nutrient management plan, as required by chapter
90.64 RCW; (ii) who owns an animal feeding operation and has a permit issued under
chapter 90.48 RCW; or (iii) who owns an animal feeding operation and has a nutrient
management plan approved by a conservation district as meeting natural resource
conservation service field office technical guide standards and who qualifies for the
exemption provided under RCW 82.08.855.
(d) "Handling and treatment of livestock manure" means the activities of collecting,
storing, moving, or transporting livestock manure, separating livestock manure solids
from liquids, or applying livestock manure to the agricultural lands of an eligible
person other than through the use of pivot or linear type traveling irrigation
systems.
(e) "Permit" means either a state waste discharge permit or a national pollutant
discharge elimination system permit, or both.
(f) "Qualifying livestock nutrient management equipment" means the following tangible
personal property for exclusive use in the handling and treatment of livestock manure,
including repair and replacement parts for such equipment: (i) Aerators; (ii)
agitators; (iii) augers; (iv) conveyers; (v) gutter cleaners; (vi) hard-hose reel
traveler irrigation systems; (vii) lagoon and pond liners and floating covers; (viii)
loaders; (ix) manure composting devices; (x) manure spreaders; (xi) manure tank
wagons; (xii) manure vacuum tanks; (xiii) poultry house cleaners; (xiv) poultry house
flame sterilizers; (xv) poultry house washers; (xvi) poultry litter saver machines;
(xvii) pipes; (xviii) pumps; (xix) scrapers; (xx) separators; (xxi) slurry injectors
and hoses; and (xxii) wheelbarrows, shovels, and pitchforks.
(g) "Qualifying livestock nutrient management facilities" means the following
structures and facilities for exclusive use in the handling and treatment of livestock
manure: (i) Flush systems; (ii) lagoons; (iii) liquid livestock manure storage
structures, such as concrete tanks or glass-lined steel tanks; and (iv) structures
used solely for the dry storage of manure, including roofed stacking facilities.
(5) The exemption under this section does not apply to sales made from July 1, 2010,
through June 30, 2013.
[ 2014 c 97 § 602; 2010 1st sp.s. c 23 § 601; 2009 c 469 § 601; 2006 c 151 § 2; 2001
2nd sp.s. c 18 § 2.]
Notes:
Effective date—2010 1st sp.s. c 23 §§ 107, 601, 602, 702, 902, 1202, and
1401-1405: See note following RCW 82.04.2907.
Findings—Intent—2010 1st sp.s. c 23: See notes following RCW 82.04.220.
Effective date—2009 c 469: See note following RCW 82.08.962.
Effective date—2006 c 151: "This act takes effect July 1, 2006." [ 2006 c 151
§ 7.]
Intent—2001 2nd sp.s. c 18: "It is the intent of the legislature to provide
tax exemptions to assist dairy farmers to comply with the dairy nutrient management
act, chapter 90.64 RCW, to encourage owners of nondairy animal feeding operations to
develop and implement approved nutrient management plans, and to assist public or
private entities to establish and operate anaerobic digesters to treat livestock
nutrients on a regional or on-farm basis." [2006 c 151 § 1; 2001 2nd sp.s. c 18 §
1.]
Exemptions - Livestock nutrient management equipment and facilities
RCW 82.12.890
(1) The provisions of this chapter do not apply with respect to the use by an
eligible person of:
(a) Qualifying livestock nutrient management equipment;
(b) Labor and services rendered in respect to installing, repairing, cleaning,
altering, or improving qualifying livestock nutrient management equipment; and
(c)(i) Tangible personal property that becomes an ingredient or component of
qualifying livestock nutrient management facilities in the course of repairing,
cleaning, altering, or improving of such facilities.
(ii) The exemption provided in this subsection (1)(c) does not apply to the use of
tangible personal property that becomes an ingredient or component of qualifying
livestock nutrient management facilities during the course of constructing new, or
replacing previously existing, qualifying livestock nutrient management
facilities.
(2)(a) To be eligible, the equipment and facilities must be used exclusively for
activities necessary to maintain a livestock nutrient management plan.
(b) The exemption applies to the use of tangible personal property and labor and
services made after the livestock nutrient management plan is: (i) Certified under
chapter 90.64 RCW; (ii) approved as part of the permit issued under chapter
90.48 RCW; or (iii) approved as required under RCW
82.08.890(4)(c)(iii).
(3) The definitions and recordkeeping requirements in RCW 82.08.890 apply to
this section.
(4) The exemption under this section does not apply to the use of tangible personal
property and services if first use of the property or services in this state occurs
from July 1, 2010, through June 30, 2013.
[ 2014 c 97 § 604;2010 1st sp.s. c 23 § 602;2009 c 469 §
602;2006 c 151 § 3;2003 c 5 § 15;2001 2nd sp.s. c 18 §
3.]
Findings.
RCW 90.64.005
The legislature finds that there is a need to establish a clear and understandable
process that provides for the proper and effective management of dairy nutrients that
affect the quality of surface or ground waters in the state of Washington. The
legislature finds that there is a need for a program that will provide a stable and
predictable business climate upon which dairy farms may base future investment
decisions.
The legislature finds that federal regulations require a permit program for dairies
with over seven hundred head of mature cows and, other specified dairy farms that
directly discharge into waters or are otherwise significant contributors of pollution.
The legislature finds that significant work has been ongoing over a period of time and
that the intent of this chapter is to take the consensus that has been developed and
place it into statutory form.
It is also the intent of this chapter to establish an inspection and technical
assistance program for dairy farms to address the discharge of pollution to surface
and ground waters of the state that will lead to water quality compliance by the
industry. A further purpose is to create a balanced program involving technical
assistance, regulation, and enforcement with coordination and oversight of the program
by a *committee composed of industry, agency, and other representatives. Furthermore,
it is the objective of this chapter to maintain the administration of the water
quality program as it relates to dairy operations at the state level.
It is also the intent of this chapter to recognize the existing working relationships
between conservation districts, the conservation commission, and the department of
ecology in protecting water quality of the state. A further purpose of this chapter is
to provide statutory recognition of the coordination of the functions of conservation
districts, the conservation commission, and the department of ecology pertaining to
development of dairy waste management plans for the protection of water quality.
(1) Except for those producers who already have a certified dairy nutrient management
plan as required under the terms and conditions of an individual or general national
pollutant discharge elimination system permit, all dairy producers licensed under
chapter 15.36 RCW, regardless of size, shall prepare a dairy nutrient management plan.
If at any time a dairy nutrient management plan fails to prevent the discharge of
pollutants to waters of the state, it shall be required to be updated.
(2) By November 1, 1998, the conservation commission, in conjunction with the
*advisory and oversight committee established under section 8 of this act shall
develop a document clearly describing the elements that a dairy nutrient management
plan must contain to gain local conservation district approval.
(3) In developing the elements that an approved dairy nutrient management plan must
contain, the commission may authorize the use of other methods and technologies than
those developed by the natural resources conservation service when such alternatives
have been evaluated by the *advisory and oversight committee. Alternative methods and
technologies shall meet the standards and specifications of:
(a) The natural resources conservation service as modified by the geographically
based standards developed under RCW 90.64.140; or
(b) A professional engineer with expertise in the area of dairy nutrient
management.
(4) In evaluating alternative technologies and methods, the principal objectives of
the *committee's evaluation shall be determining:
(a) Whether there is a substantial likelihood that, once implemented, the alternative
technologies and methods would not violate water quality requirements;
(b) Whether more cost-effective methods can be successfully implemented in some or
all categories of dairy operations; and
(c) Whether the technologies and methods approved or provided by the natural
resources conservation service for use by confined animal feeding operations are
necessarily required for other categories of dairy operations.
In addition, the *committee shall encourage the conservation commission and the
conservation districts to apply in dairy nutrient management plans technologies and
methods that are appropriate to the needs of the specific type of operation and the
specific farm site and to avoid imposing requirements that are not necessary for the
specific dairy producer to achieve compliance with water quality requirements.
(5) Such plans shall be submitted for approval to the local conservation district
where the dairy farm is located, and shall be approved by conservation districts no
later than by July 1, 2002. The conservation commission, in conjunction with
conservation districts, shall develop a statewide schedule of plan development and
approval to ensure adequate resources are available to have all plans approved by July
1, 2002.
(6) If a dairy producer leases land for dairy production from an owner who has
prohibited the development of capital improvements, such as storage lagoons, on the
leased property, the dairy producer shall indicate in his or her dairy nutrient
management plan that such improvements are prohibited by the landowner and shall
describe other methods, such as land application, that will be employed by the dairy
producer to manage dairy nutrients.
(7) Notwithstanding the timelines in this section, any dairy farm licensed after
September 1, 1998, shall have six months from the date of licensing to develop a dairy
nutrient management plan and another eighteen months to fully implement that plan.
(8) If a plan contains the elements identified in subsection (2) of this section, a
conservation district shall approve the plan no later than ninety days after receiving
the plan. If the plan does not contain the elements identified in subsection (2) of
this section, the local conservation district shall notify the dairy producer in
writing of modifications needed in the plan no later than ninety days after receiving
the plan. The dairy producer shall provide a revised plan that includes the needed
modifications within ninety days of the date of the local conservation district
notification. If the dairy producer does not agree with, or otherwise takes exception
to, the modifications requested by the local conservation district, the dairy producer
may initiate the appeals process described in RCW 90.64.028 within thirty days
of receiving the letter of notification.
(9) An approved plan shall be certified by a conservation district and a dairy
producer when the elements necessary to implement the plan have been constructed or
otherwise put in place, and are being used as designed and intended. A certification
form shall be developed by the conservation commission for use statewide and shall
provide for a signature by both a conservation district representative and a dairy
producer. Certification forms shall be signed by December 31, 2003, and a copy
provided to the department for recording in the database established in RCW
90.64.130.
(10) The ability of dairy producers to comply with the planning requirements of this
chapter depends, in many cases, on the availability of federal and state funding to
support technical assistance provided by local conservation districts. Dairy producers
shall not be held responsible for noncompliance with the planning requirements of this
chapter if conservation districts are unable to perform their duties under this
chapter because of insufficient funding.
Preference applies only to equipment and facilities listed in
statute that are exclusively used to handle and treat manure
The Legislature identified in statute which equipment qualifies for the sales and use
tax exemption. The preference applies only to services and items used exclusively for
repairing, cleaning, altering, or maintaining existing facilities or structures. It
does not apply to new construction.
Qualifying equipment
Sales and use tax does not apply to purchases or repairs of the following equipment
when used exclusively to handle and treat livestock manure. Repair services and
replacement parts for the equipment are also exempt.
Aerators
Agitators
Augers
Conveyers
Gutter cleaners.
Hard-hose reel traveler irrigation systems.
Lagoon and pond liners and floating covers.
Loaders
Manure composting devices.
Manure spreaders.
Manure tank wagons.
Manure vacuum tanks.
Poultry house cleaners.
Poultry house fame sterilizers.
Poultry house washers.
Poultry litter saver machines.
Pipes
Pumps
Scrapers
Separators
Slurry injectors and hoses.
Wheelbarrows, shovels, and pitchforks.
Qualifying structures or facilities
Sales and use tax does not apply to services used to repair, clean, alter, or improve
the following structures or facilities. Items installed as part of such services are
also exempt:
Flush systems.
Lagoons
Liquid livestock manure storage facilities, such as concrete tanks or glass-lined
steel tanks.
Legislative Auditor recommends continuing the preference
The Legislature should continue the preference because it is helping dairies
and animal feeding operations implement their nutrient management plans. The
preference is one of many efforts to help maintain and improve water quality in
Washington.
If the Legislature wants more accurate information on the size of the beneficiary
savings, it should require the Department of Revenue to collect data on qualifying
sales.
