A PLACE FOR AG
	TOGETHERNESS
	EDITORIAL
	Wisconsin Favorites Holidays Sparkle in Sparta

A PLACE FOR AG
Lawmaker Grapples with Livestock Siting

Dave Ward knows the value of agriculture to the State of Wisconsin. The 37th District assemblyman and former dairy producer has spent much of his career addressing issues to build a healthier environment for dairy and all of production agriculture.

But perhaps no issue keeps the growth of Wisconsin agriculture hanging in the balance like the one Ward is grappling with these days: Where should livestock facilities—many of them much larger than their predecessors—be located?

The answer might seem like an obvious one. But with the state’s rural countryside dotted not only with farms of vastly varied sizes but a growing number of residences occupied by former urbanites, the question has become a nagging one.

Rural Character, Rural Business

Ward’s own involvement in the issue of livestock facility siting stems back to the late 1990s, not far from his own family farm in Fort Atkinson. “Jefferson County had just finished an update of their land use plan. In fact, I believe it was the first to do so in the state,” Ward recalls. “There was a farmer milking cows in the county with about a 30,000-pound herd average who wanted to expand from 300 to 700 cows. The town board attempted to block him from doing so.”

Ward says the preamble to the county’s new land-use plan stated that the county should strive to maintain its rural character. How better to do so, Ward thought, than to stimulate growth of the county’s dairy industry by allowing expansion of a successful and progressive operation? The county board apparently agreed, overturning the town board’s decision. The debate sparked numerous letters to the editor in local papers, many warning that the county would become a hotbed of so-called “factory farms.”

That experience led Ward to believe that the state’s farmers needed some protection to grow their businesses. As a way to get the discussion started, Ward drafted a bill addressing livestock facilities of 1,000 animal units or more. “Animal units” is generally defined as a 1,000-pound mature beef animal or equivalent number of other livestock or poultry. The bill stated that if facilities met the requirements contained in NR243, part of several Department of Natural Resources rules addressing runoff pollution (also known as nonpoint source pollution), then no local authority could block a permit, essentially taking township and county government out of the process. “I drafted the bill after session was over, simply so we could start talking,” Ward explains. For about two years, those discussions were slow to come.

Courting a Consensus

But at the start of the 2003 legislative session, the issue finally came alive. “Wisconsin Governor Jim Doyle had just appointed Rod Nilsestuen as secretary of agriculture. We had a Democratic ag secretary and a Republican legislator who agreed on a lot of issues,” explains Ward in referring to his relationship with the agency. “One of the most significant of those was the need to address livestock siting.”

Ward helped to get the ball rolling with meetings among various stakeholders. He jokes that he liked to keep a copy of the legislation pre-empting local control on his desk during those early discussions just to let those involved know he had not completely given up on the idea. But in all seriousness, Ward says local decision makers found they had a lot to gain by being proactive in the process. Sure, local government ran the risk of a pre-emptive bill, but Ward says it also became apparent that some of the decisions to block livestock expansions at the local level could not be defended. Everything from racial discrimination to what could only be described as jealousy had played into a surprising number of local decisions. “In the end, I also think that local officials welcomed the idea of criteria they could use so they were no longer caught in the middle of these often-heated debates,” adds Ward.

Ward says he was heartened to hear from local government and other stakeholders early on that they wanted some reasonable standards producers could meet to qualify for a permit. “I give our local government officials a lot of credit for taking the lead on going in that direction,” he says. “Many of our environmental interest groups also deserve recognition for their role in supporting this path and keeping us balanced. I believe many felt that if our rural landscape was not used for animal agriculture, then what would it be used for? Likely more subdivisions. It seemed the majority preferred to see animal agriculture.”

Crafting a Plan

Once the initial rounds of discussions had taken place, Wisconsin Department of Agriculture, Trade and Consumer Protection (DATCP) Secretary Nilsestuen appointed what became known as the “Rhode Committee,” after its chairman, former ag secretary Gary Rohde. The committee included producers, University of Wisconsin Extension personnel, local government and county zoning officials, Wisconsin DNR officials, and representatives from most of the major livestock groups in Wisconsin. The committee developed criteria that any legislation should include in addressing livestock facility siting and minutes from the meetings formed the basis of legislation drafted at the start of the 2004 legislative session.

Its purpose was multi-fold: protect public health and safety, ensure requirements could be cost effective for producers, grow agriculture in Wisconsin, and base requirements for facility siting on science-based criteria. “Drafting the bill was the easy part,” says Ward. “Writing the rule once the legislation passed has been the difficult step.”

Meanwhile, local battles continue. On Oct. 31, electors in the town of Chilton in Calumet County overwhelmingly passed a two-year moratorium on the construction of any new confined animal feeding operations (CAFOs) with more than 1,000 animal units. The town residents who asked for the moratorium objected to announced plans by the owner of a 3,800-cow facility in the town of Rantoul to construct a facility for 4,000 cows near the town of Chilton. The moratorium still has to be approved by the Calumet County board, which is not scheduled to meet until December 20.

Odor, Operations, Optimism

While he had hoped the days of moratoriums were past, Ward remains determined to move forward. He sites odor as the biggest issue left to be hammered out. “I believe we need to address odor or someone else will address it for us and I don’t think animal agriculture will like how someone else chooses to address it.” In fact, local governments cite odor as the cause of 90 percent of problems they deal with. Other states haven’t really addressed the odor issue.

DATCP held hearings on the proposed rule, ATCP 51, before sending it to the Legislature where it will remain, awaiting further action expected to come in December or early January. Estimates are that the rule will only impact about 40 to 50 farming operations each year and that 90 percent of those will pass. The rule does not impact existing operations that aren’t expanding.

A worksheet outlines the necessary criteria for approval. Ward says a score sheet for addressing odor has been developed based on distance between neighbors and the odor source. “We have taken these measures out to the countryside, to real farms. Farmers are sometimes surprised they pass. There’s the perception out there that everyone is going to have to invest in methane digesters. But there are a number of cost-effective ways to address the issue of odor,” he says.

The proposed rule also allows for an appeal process, both for farmers and neighbors within a two-mile radius. “This gives the producer and local government a referee other than the court system,” Ward explains. If a case still ends up in court, the decision of that local appeals board will have standing.

Ward is optimistic that remaining issues can be adequately addressed and the rule can become a workable solution for Wisconsin. “I really think we’re close,” says Ward. “Others might not think so. Others have said it can’t be done. But I’m optimistic. We’ll get the job done.”—Lori Weaver

The Case for Growing Agriculture

Dave Ward says one of his primary goals for the livestock siting process is to grow Wisconsin agriculture. “I see the need for Wisconsin to maintain or expand its herd size. We had 320 cheese factories in 1976. Today we have about 120. If we start losing milk, we’ll lose that infrastructure,” he explains.

He says that by removing contentious local barriers to expansion of animal agriculture, local governments will find that having two or three 500-cow dairies near their communities is not a bad thing. “These communities are looking at economic development from the standpoint of attracting big factories to their towns. I’m saying, why can’t we look at large animal agriculture as the economic stimulator it is?”

The facts back Ward up. Research conducted by the Wisconsin Milk Marketing Board found that the connection between quality of life and Wisconsin’s dairy industry remains elusive to most state residents. But Wisconsin’s dairy industry contributes $20.6 billion to the state’s economy every year, more than the citrus industry gives back to Florida or the potato industry impacts Idaho. In fact, it plays a huge role in the economic health of Wisconsin communities, with every cow generating more than $17,000 in economic activity each year. Furthermore, dairy’s presence is vital to the state’s future, employing more than 160,000 people in the state.

TOGETHERNESS
Energy Agendas Converge, Differences Persist

The factions in Wisconsin’s utility restructuring wars of the 1990s fought to a standstill, but nothing any of them could have done would stop the electric power industry changing, like any business with the vitality to respond to evolving conditions.

Conditions then were evolving with unusual speed; indeed, at a pace unfamiliar to the stolid utility industry. A landmark ’90s event was the unexpected, prolonged maintenance outage of major Wisconsin generating plants, just at the peak moment of argument over who should do the generating and in what sort of relationship with consumers. The coincidence may have saved this state’s energy policy from going over a cliff.

But while the laws of physics still dictate that the product and means of delivery remain unaltered, the challenge of growing demand propels adoption of new organizational structures and new thinking about how electric power providers can best do their jobs.

This fall, nearly a hundred individuals who make their living either providing electricity or thinking about how it’s done gathered in Madison to examine current trends and future concerns.

In an atmosphere of cordiality that might have been far less evident a decade ago, people who once battled over utility consolidation and deregulation spent a balmy October day discussing how their organizations, some of which didn’t exist in the ’90s, could best accommodate one another’s interdependent needs.

Choose Your Crisis

The Third Annual Energy Conference of the Customers First! Coalition was itself a comment on how different things are: Customers First! (CFC) was formed in 1995 by the Wisconsin Federation of Cooperatives and several other groups specifically to resist restructuring initiatives by some of the conferees.

Early on, Madison Gas and Electric Vice President Scott Neitzel noted that electric transmission needs are defined very differently now than in the 1980s or ’90s.

Few would know better. As a Public Service Commission member in the mid-’90s, Neitzel led a government, industry, and interest-group task force assembled to map Wisconsin’s path to competitive retail electricity markets, then regarded as inevitable and imminent. As a conference panelist, he underscored how fundamentally the landscape has shifted.

“Increased transfer capacity is now seen as good for the industry regardless of the regulatory regime,” he said.

Unspoken but clear was the reminder that when retail electric competition was believed to be just around the corner, some of those in the room saw transmission access as a lifeline, while others saw it as a noose.

The topic was the American Transmission Company’s (ATC) Access Initiative, an effort to obtain early Public Service Commission guidance as to which, if any, new interstate transmission projects might win regulatory approval.

ATC has floated several possibilities to bolster Wisconsin’s high-capacity links to importable power. These include another connection to Illinois, where we now have four; a third line to Minnesota, where we have one and one more under construction; and a line to Iowa, where we have none with the 345,000-volt capacity contemplated. Each neighboring state has several more interstate transmission paths than does Wisconsin.

But WE Energies Vice President Larry Salustro suggested ATC “take a year off from this access project” and watch how the Midwest Independent Transmission System Operator’s (MISO) wholesale market performs before deciding if more transmission is needed.

“We’re not in a crisis…It’s good to step back,” Salustro said.

How Things Change

The MISO and ATC are prime examples of how the industry has changed.

Formed under a 1999 electric reliability law, ATC comprises the transmission systems of four major utilities serving eastern Wisconsin. The four original owners, one additional investor-owned, and nearly two-dozen cooperative and municipal utilities have ownership interests in ATC. Unlike “vertically integrated” utilities that generate power, move it through large transmission lines, and distribute it to each consumer, ATC does transmission, period.

The MISO is newer still—and far larger. Based near Indianapolis, it provides centralized dispatching of transmission service, power congestion management, and grid monitoring for reliability across a region from Kentucky to Manitoba. It operates real-time and day-ahead wholesale markets for bulk power transactions, at prices based on the relative difficulty of delivering electricity to any given point in its system.

That pricing structure, “locational marginal pricing,” is a major concern for Wisconsin. With one of the nation’s most constrained transmission systems, this state’s energy providers and consumers almost inevitably will pay more than those in neighboring states for delivered wholesale power.

In the ’90s, Salustro’s company and others faced a related—if different—dilemma. In fact, there were twin dilemmas: The domestic generation shortage compelling more power imports through a barely adequate transmission system and the perceived threat that greater transmission (or “transfer”) capacity would facilitate direct dealing between large-volume retail consumers and generators located—theoretically—anywhere in the country. This was a challenge the then-Wisconsin Electric Power Company tried in part to forestall through an ill-fated merger attempt with Northern States Power, now Xcel Energy.

The real solutions would be found elsewhere. California’s restructuring fiasco proved a true appetite suppressant for utility executives once lured by visions of swashbuckling competition, and two rounds of Wisconsin reliability legislation addressing the state’s generation and transmission deficiencies brought people’s focus back to basics.

“We still have our eye on reliability, but there is not a sense of crisis,” Salustro said.

Crisis or not, ATC Vice President Mark Williamson was uninterested in “a year off.” The ATC system, he said, “is at its limits. Very little new load growth or generation service can be added without reinforcement.”

In other words, there’s no simple choice between more domestic generation or more transmission to import power. In Williamson’s view, the transmission system needs strengthening either way.

“It’s better to have a little too much transmission than a little too little,” he said.

All The Right Answers

Construction of Wisconsin’s first new major interstate transmission line in a quarter-century began this summer, six years after it was proposed. Energizing that line, probably two years from now, won’t settle how much transmission capacity Wisconsin wants or needs.

Scott Neitzel says more transmission means more choice of fuel types, including renewable energy, and freer access to affordable wholesale power.

Larry Salustro points to several billion dollars in utility construction currently underway and warns of the impact on consumers if costs continue being added.

Mark Williamson quotes ATC head Jose Delgado saying, “The most expensive transmission line is the one you didn’t build when you needed it.”

And of course they’re correct, in every case.—Dave Hoopman

EDITORIAL
by Perry Baird

Freight Fight

Sporting buttons imprinted with “Stop Freight Rail Abuse,” Midwestern cooperative leaders urged a legislative remedy to discriminatory pricing by freight-carrying railroads. Gathered in Bloomington, Minnesota, for the November annual meeting of the Wisconsin Federation of Cooperatives, representatives of electric and other co-ops impacted by burgeoning freight rates signed letters urging federal lawmakers to back legislation aimed at restoring rail competition.

For cooperative electric utilities in the region, rail rates charged for shipping coal from Western mines are predicted to more than double—with shipping costs per ton actually eclipsing the cost of the mined coal itself. Wholesale and retail electric rates would correspondingly ratchet up as costs swell.

Co-op’ Captors

As we pointed out in our September cover story (see www.wecnmagazine.com), Midwestern electricity producers such as Dairyland Power Cooperative of La Crosse are what’s known in the industry as “captive shippers,” unable to secure needed coal shipments from any source other than one rail company. The railroads fully realize they have their customers boxed in and are exacting payments from them that far exceed prices they charge for delivering the same commodity to businesses that have a choice of shippers (see chart on this page).

Glenn English, CEO of the National Rural Electric Cooperative Association, told the federal Surface Transportation Board at an October hearing, “Twenty percent of all shippers are captive shippers and they are being taken advantage of.” He said railroad deregulation that came following a 1980 law is not working for captive rail customers in many vital industries.

“Today, cooperatives that are captive under current practices and decisions are subject to the unrestrained monopoly power of the rail carrier upon whom they are dependent,” English told the three-member panel that regulates U.S. rail service.

Back to Bob

Accosting the monopoly power of railroads was one reason Wisconsin’s famous U.S. senator, Robert La Follette, earned the nickname, “Fighting Bob.” Nearly a century ago, La Follette eloquently spelled out the relationships that framed what was then a national discourse on railroad practices.

“The shipper is especially interested in equal and impartial rates. The consumer is especially interested in reasonable rates,” he wrote in a 1912 memoir (emphasis added). To accentuate how rail rates have a “trickle-down” effect on the consuming public, La Follette noted, “He [the shipper] always charges the rate in as part of the cost to the consumer, who is the real freight payer the country over.”

In cooperatives, the end-users—in the case of electric co-ops, retail ratepayers—are themselves essentially the shippers, since the businesses are consumer-owned. So, following La Follette’s line of thinking, co-op members such as those assembled recently in Bloomington should indeed take great interest in both the fairness and impartiality of rail rates.

They’re doing so by backing Railroad Competition Acts (S.919, H.R.2047) in Congress. La Follette’s fight continues.

This year, start your holiday season with a spark in Sparta, where Santa arrives and the lights begin twinkling early for a four-week stay.

Events commence this year on Friday evening, December 2, at the annual Children’s Holiday Parade. This annual event, begun in 2002, kicks off at 5:15 p.m. in downtown Sparta at the corner of Franklin and Water streets, proceeding south on Water, east on Oak, onto East, and winding up at Evan–Bosshard Park. The parade lasts about half an hour, treating onlookers to more than 20 lighted units—Sparta’s school bands, local organizations, business owners, and people who just love participating in parades. The only requirements are that each float or unit must be lighted and must be decorated with a holiday theme. The colorful parade is climaxed by that jolly old elf, Santa Claus himself, riding in a horse-drawn wagon.

The procession winds its way to Evans-Bosshard Park in time for the 6 p.m.lighting ceremony, making more than 130,000 lights illuminate the Holiday in the Park festival. There, the exhibits will be aglow from 5–9 p.m. each Friday and Saturday evening from now until Christmas Eve. Visitors who stroll through the park will enjoy carolers, concessions, walking tours, a warming hut, decorated wreaths and trees, large wooden holiday cards made by local school classes, and visits with Santa. Begun by the local Rotary Club, the event is now co-sponsored financially by the Sparta’s tourism organization. Setting up, lighting, and decorating the displays and trees involves Rotarians and countless local volunteers, including everyone from school kids to inmates of the Monroe County Jail; each inmate who volunteers gets credit for a day served plus credit for a day of community service, which shortens his sentence by one day.

Related events in the holiday-minded town this month include Holly Days Open House and the Holiday Train. Holly Days are put on by the downtown Sparta businesses. Held Thursday, December 1, through Sunday, December 4, the open house includes store specials, wagon rides, food, music, and other events for shoppers and their children. The lighted Canadian Pacific Railway’s lighted Holiday Train stops on the night of December 10 at 10 p.m., bringing a concert featuring Willy Porter, a Milwaukee-based singer, guitarist, and songwriter. The concert at the old Chicago–Northwest Depot (now the Chamber of Commerce Office) is free, but it’s a fundraiser for food pantries, so please bring a non-perishable food item.

With all the December activities in Sparta, there’s no excuse for anyone to have a lackluster season, so start sparkling in Sparta this weekend and throughout the month—Linda Hilton

For further information about Sparta’s holiday events, visit www.bikesparta.com or call the Sparta Area Chamber of Commerce at 698/269-4123 or 800/354-2453. Evans–Bosshard Park is located at 714 N. Benton Street; the Holiday Train will stop at the old depot, 111 Milwaukee Street.