By Howard Fischer
Capitol Media Services
PHOENIX -- State lawmakers are moving to undo a rule designed for more humane treatment of laying hens based on the claim by its sponsor that it will help hold down egg prices.
The measure already approved by a Senate panel would strip the Department of Agriculture of its ability to enact rules requiring farmers to move to cage-free operations. That rule was supposed to be in effect now but got delayed until 2026 amid concerns of effects on farmers in what has now become a multi-year outbreak of the avian flu.
But the legislation by Sen. Shawnna Bolick, R-Phoenix, to overturn the rule before it takes effect -- and allow hens to be kept all their lives in cages as small as 67 square inches of usable floor space -- may not be the end of the fight over whether the practice is inhumane.
The department adopted the rule amid threats that animal rights groups would put the issue directly to voters -- and in a way that would force farmers to change even faster than they wanted. In fact, the agency rule was approved with the blessing of Hickman's Egg Ranch, the state's largest producer. Now, however, the industry is lobbying to scrap the rule entirely. And if that happens, the same groups whose initiative threat spurred the Department of Agriculture into adopting the rule could be back -- this time with something less to the industry's liking and something that lawmakers could not override.
"I can't say exactly what we would do regarding a ballot measure,'' said Chris Holbein, public policy director for farm animal protection at Humane World for Animals, the group formerly known as the Humane Society of the United States. But he said the organization is "committed'' to getting a regulation enacted.
"We will continue to explore all of our options on it,'' Holbein said.
At the heart of this multi-year fight is what is humane -- and what is the price of all that.
It started in 2020 when what was then the Humane Society of the United States floated the idea of putting a measure on the ballot to require all eggs sold in Arizona to come from cage-free hens. The idea so scared the main farms, including Glenn Hickman, president of the state's largest egg producer with the company that bears his family name, that he agreed to a deal: Have the Legislature adopt the standard, but with a delayed effective date.
That measure faltered. But the Department of Agriculture picked up the issue and, with the support of the farmers, adopted its own rule phasing in the change: Go first to 144 square inches and, by the beginning of this year, have all major producers being cage-free, meaning free to walk around inside a barn. It does not mean free-range hens who can go outside. That then quashed any plans to put the question to voters. But now the industry now is backing away from its agreement to spend the extra money for cage-free barns. And Patrick Bray, the lobbyist for the Arizona Farm and Ranch Group, is using the bird flu -- and the price of eggs -- to tell lawmakers to kill the rule.
"Now we're in a whole new situation,'' Bray told members of the Senate Committee on Regulatory Affairs and Government Efficiency of the legislation, with the removal of 30 million birds due to the latest round of the avian flu.
"We are in a complete deficit of egg-laying hens,'' he said. And that is complicated, Bray said, by the flu spreading into the pullets -- chickens younger than one year -- who were supposed to replace the egg-laying hens.
"So it is going to be quite a while to play catch-up and to get back online and get enough supply in the chain so we can lower prices,'' he said.
But Sam Richard, who lobbies for Humane World for Animals, told lawmakers they should not interfere with the efforts of the Department of Agriculture to implement the rules. And he pointed out the agency, showing it is sensitive to any potential effects of the flu on supply and price, has agreed to delay implementation until 2026.
And what of the price of eggs?
"There's also no direct correlation right now the cost of eggs is because of the restriction on their housing size,'' Richard said.
"Avian flu is a serious epidemic,'' he continued. "And confinement has not yet been proven to have any relevance or correlation.''
Bolick, in a prepared statement, said she believes killing the rule for cage-free eggs will help consumers.
"As someone who goes grocery shopping for my household, I have seen the price of a dozen eggs more than double during the past four years,'' she said. "While we can't solve the cause of bird flu, we can pass a law for Arizonans to see some relief on their grocery bills, and hopefully, eradicate the daily limits imposed on consumers at grocery stores due to high demand.''
Bolick's legislation comes despite the fact that the rules were the result of that larger deal between animal rights groups and the industry by Hickman. He told lawmakers he worried that voters would adopt a stricter initiative that not only have required cage-free systems immediately upon voter approval but also had criminal penalties. There was reason for the fear that voters would side with the chickens over the producers: In 2006, they approved a ban on "gestation crates'' for pig and cattle ranchers. Hickman told lawmakers in 2021 it was just "pure luck'' that his laying hens weren't part of that successful initiative.
Even the Department of Agriculture reached the same conclusion in justifying the rules, citing "the success of recent animal welfare ballot initiatives in Arizona and elsewhere'' to justify the rule. Hickman himself told lawmakers at the time his company already had been moving into the cage-free market. He said that some clients, including McDonald's and Costco, already were demanding cage-free eggs. And now? Messages left for Hickman and the company were not returned. But Bray told lawmakers at the most recent hearing that the situation has changed.
"You already have avian influenza,'' he said.
"Someone like Hickman's would have to take a million more birds off the market as they retrofit these barns,'' Bray said. "And we just don't have the luxury of doing that at this point in time. We want every egg possible on that market to bring down prices.''
Bray conceded that it was the fear of a successful initiative that led producers like Hickman to accept the less-onerous rule. But he said he's less concerned about that now.
"The price of eggs was the epicenter of this last election,'' Bray said.
"If you go to the ballot now, with the price of eggs where they're at, I think people are going to go, 'I think we've had enough of that,' '' he said.
Not everyone was convinced that allowing producers to keep hens in those 66-square-inch cages will do much to make eggs more affordable. Sen. Mitzi Epstein said there are other options.
"One of them is slowing down the growth of retail monopolies who are just raising the prices higgily-giggily,'' said the Tempe Democrat. There's also the fact that the Department of Agriculture, in adopting the rule -- albeit before avian flu -- concluded that eliminating cages would add anywhere between a penny and 3.25 cents per egg. Using an estimate of annual per capital consumption of slightly more than 270 eggs a year, that pencils out to somewhere between $2.71 and $8.79 per person. Farm Action, a national group that targets corporate monopolies, last month asked the Federal Trade Commission and the Department of Justice to investigate the higher prices, suggesting that producers were being deliberately slow to replenish flocks to keep profits higher.
Plus the U.S. Department of Agriculture provides payment to farmers who have to destroy birds and eggs.
There also is a bit of history. A federal jury in Illinois two yeas ago ordered $17.7 million in damages for food manufacturers who sued major egg producers over what they said was a conspiracy to limit the price of eggs in the 2000s. If lawmakers quash the ability of the Department of Agriculture to enact and implement the rule it effectively would kill the efforts of a Tucson restaurant owner to have a judge do the same thing. Grant Kruger filed suit in 2023 saying the agency is exceeding its authority. Krueger said he is affected because of the economic harm to his three restaurants: Union Public House, Reforma Modern Mexican Mezcal + Tequila, and Proof Artisanal Pizza and Pasta. No date has been set for a trial.
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