The Story of one Oregon Mega-dairy is the Story of America's Ag Epidemic

A common adage in agriculture holds that most people don't really understand where their food comes from. Former Department of Environmental Quality Acting Administrator Eastern Region, Mitch Wolgamott, understands this all too well.

In March 2017, Lost Valley Farm mega-dairy received permits to run a 30,000 head operation near Boardman, Ore. A mega-dairy is defined as a large-scale, commercial dairy operation.

Proponents pitched Lost Valley as a rural economy booster, intended to supply the Tillamook County Creamery Association with dairy products. The reality of the operation, and operations like it, could have permanently devastated the area. Lost Valley Farms’ negligence was halted thanks to Oregon Rural Action’s work with Friends of Family Farmers, Columbia Riverkeeper, Food and Water Watch and many others.

The chain of events in this environmentally fragile area highlights the severity of industry’s impact on rural communities if they’re not regulated properly.

“Industrial agriculture isn't any different than any other big corporate interest. They're not out here to benefit the communities. No matter what their PR people say, that's not what their motivation is,” Mitch said.

In his 26 years working for the Oregon Department of Environmental Quality, Mitch saw first hand how industry shapes the environment of rural communities. It’s a larger issue of vulnerable communities needing economic opportunity and getting taken advantage of by industry and consolidation.

Lost Valley Farm sat near Boardman in Morrow County, a county that is mainly agricultural. In addition to family operations in the area, the largest mega-dairy in the state, and one of the largest dairies in the country, Threemile Canyon Farms, a 70,000 head dairy operates just a few miles down the road. The area is dry and relies on heavy irrigation for agriculture. For decades, heavy irrigation and fertilizer runoff from ag operations has caused environmental issues (like groundwater contamination) in the county.

In 1990, the Oregon DEQ declared the Lower Umatilla Basin (an area stretching from Morrow county to Umatilla county) a groundwater management area. In 1999, Threemile Canyon Farms moved into the area.

Samples taken from different test sites around the basin showed levels of nitrate-nitrogen exceeding the federal safe drinking water standard.  

In the early 2000s, Mitch directly oversaw the area of the Lower Umatilla Basin Groundwater Management Area working to reduce the nitrate levels in the area’s water.

High nitrate levels, above 10 parts per million (ppm), in drinking water can cause people to get sick, especially infants, the elderly and people with immune disorders. High nitrate levels reduce red blood cells’ ability to carry oxygen. This can cause methemoglobin in infants, the elderly and immune deficient individuals. Methemoglobin symptoms include headache, dyspnea, lightheadedness, weakness, confusion, palpitations and chest pain.

The levels of nitrate-nitrogen are particularly high in this area because of irrigation seepage into the groundwater. Grains, hay and grasses for livestock make up the majority of agriculture in the county.

“In general the first thing to know about the area is that it's very dry, and it's also very sandy, porous soils. When there is rain or snow melt, runoff goes right down through that sandy soil taking nitrate with it. There were some wells that were low in nitrate and others that were high. It ranged from non-detectable up to well-over 100 milligrams per liter, which is very high, and ever since 1990, levels have continued to increase to this day,” Mitch said.

Due to the notoriety of the area’s environmental instability and 28 years of working to lower the nitrate levels in the county, Mitch was astounded that industry could approach the area with plans for such an intensive use.

“The operation just never should have been permitted in the first place,” Mitch said. “The area is and has been an area of environmental concern for three decades.”

There are more environmental concerns from mega-dairies than the runoff from tens of thousands of dairy cows. Mega-dairies are large irrigators because they often grow feed for their livestock, which means intensive fertilizer application, followed by heavy watering.

“A mega dairy is such a huge environmental concern because on top of the runoff, they are often large irrigators, meaning nitrate increase in the Umatilla Basin, in addition to pollution associated with runoff and methane.”

The permit for Lost Valley estimated the mega-dairy would produce 187 million gallons of wastewater and manure annually. During operation, Lost Valley put a thousand acres of land under new irrigation.

“It was a huge increase in the nitrogen loading, which never should have been allowed until we got a handle on what was already there,” said Mitch.

And although nearly 4,000 Oregon residents wrote in opposition of the farm, Lost Valley was permitted anyway.

In its short existence, Lost Valley was cited numerous times, failed inspections and violated permits.

The operation was created and managed by Greg te Velde, a dairy farmer who has two other farms in California. From the beginning, there were red flags with te Velde’s capability to act as a safe steward of the land.

In April 2017, one month after it was permitted, Lost Valley received its first violation. Te Velde was not complying with Lost Valley’s wastewater permit, which regulates how the dairy is supposed to dispose of manure.

In February 2018, the Oregon Department of Agriculture sued te Velde as owner of Lost Valley for endangering nearby drinking water wells by allowing manure and wastewater to overflow storage lagoons. A spokesperson for the mega-dairy, denounced those claims.    

Later, the Oregon Department of Agriculture captured photos of cows standing ankle deep in their own slurry.

During this time, te Velde ran into financial issues due to gambling and drug use.

Te Velde filed for bankruptcy on April 26th, 2018, to avoid auctioning Lost Valley Farm’s 14,500 cows scheduled for the next day.

In June, the state announced te Velde did not abide by the state’s provisions to:

• limit wastewater to 65,000 gallons per day

• remove nearly 24.4 million gallons of wastewater from the property

• And, report health and safety system failures within 24 hours

On June 27, 2018, Oregon revoked Lost Valley Farms’ permit to operate. Despite the revocation, in late August 2018, Multnomah County Circuit Court Judge Kelly Skye ruled Lost Valley Farm could stay in operation even though Lost Valley owner, Greg te Velde, had violated wastewater permits.

In September 2018, bankruptcy judge Judge Fredrick Clement handed over the second largest mega-dairy in the state to trustee, Randy Sugarman after te Velde continued gambling and illegal drug use, proving himself incapable of running the mega-dairy.

Today Lost Valley Farms is up for auction, with bids starting at $66.9 million, from Canyon Farm LLC, incorporated in Delaware but lists its address as a post office box in Pasco, Wash.  

The fact that this operation was able to pass the permitting process and continue to operate after violating laws, highlights the much larger problem with our agricultural system and industry.

The abuses at Lost Valley are not unique to this one mega-dairy. Instances of malpractice from mega-dairies is common throughout the country. In addition to environmental hazards, and the negative economic impact on more healthy, sustainable, smaller-scale dairies, workplace safety is a huge problem at mega-dairies like Lost Valley.

In 2017, two men lost their lives at two separate farms in Idaho after drowning in manure ponds.  

The Washington Post reported in 2015 there were 6,700 injuries and 43 deaths on dairy farms with more than 11 employees. Even among the typical, every day dangers that come from farming, the Post reported, conditions at mega-dairies are statistically, and unusually dangerous. That’s even before you account for the under-reporting problem at operations fueled by migrant workers who fear that speaking out, or reporting major injuries will cause their visas to be revoked.

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Mega-dairies and Confined Animal Operation Feeding Operation (CAFOs) are systematically changing the ag economy.

As large-scale, consolidated operations move in, small to medium sized, independent producers go out of business. Big operations scale up supply, drive down price, and do it — like in the case of Lost Valley — by not paying for the full cost of the environmental damage they create. Those costs are passed on to the state to clean up, or show up in hospital bills for sickened neighbors drinking polluted water.

In 2018, many publications released articles unearthing the bleak realities of the dairy industry. In December, The Washington Post published a piece written by a dairy farmer who, after 40 years, sold his herd and closed up shop. That farmer is Jim Goodman, President of the National Family Farm Coalition.

“As devastating as the 1980s were for farmers, today’s crisis is worse,” Goodman wrote in Dec. of 2018. “Ineffective government subsidies and insurance programs are worthless in the face of plummeting prices and oversupply (and tariffs certainly aren’t helping). The current glut of organic milk has caused a 30-percent decrease in the price I was paid for my milk over the past two years. “

In 2018 alone, Goodman’s home state of Wisconsin lost 382 dairy farms by August. In 2017, Wisconsin lost 283 dairy farms.

The article attributes the core of the dairy industry problem to consolidation. All markets, including niche markets like organic milk, fall into the same "get big or get out" practices that conventional milk started adhering to in the ‘80s. Unfortunately for rural communities, wrote Goodman, the effect seeps into the local economy and poisons small businesses.

“Farms felt the impact most directly, but there were few in rural communities who were untouched,” he said. “All the businesses that depended on farm dollars watched as their incomes dried up and the tax base shrank. Farm foreclosures meant fewer families and fewer kids, so schools were forced to close. The Main Street cafes and coffee shops – where farmers talked prices, the weather and politics – shut down as well.”

Through an Oregon Employment Department report, the Capital Press found “the number Grade A licensed dairies in Oregon fell from 520 in 1990 to 228 in 2017, a 56 percent decline.”

“That's a 56 percent decline since Three Mile Farm, the state's biggest mega-dairy and the major supplier of Tillamook Creamery, started up,” Mitch said.

The Washington Post author discussed the stark difference in dairy management practices between mega-dairies and mid to small operations.  

"Those dairy farms that remain milk hundreds, or thousands, of cows, keeping them in huge barns and on concrete lots. The animals seldom, if ever, get the chance to set their hooves on what little grass is there. All the machinery has become bigger, noisier, and some days it runs around the clock.” said Goodman. “Manure from the mega-farms is hauled for miles in huge tanker trucks or pumped through irrigation lines onto crop fields. The smell, the flies and the airborne pathogens that go with it have effectively done away with much of the peaceful countryside I used to know."

Production methods have turned to consolidation to optimize quantity over quality. Ultimately, this has hurt family farms by slashing prices well below production costs. On average, one study found, farmers spend $20 per hundredweight to produce dairy. They’re making, on average $14 per hundredweight in return, in some places less.

Goodman explained the New Farm Bill (signed into effect on December 20th, 2018) provides modest relief for larger dairy farmers by expanding some subsidies, and lowering premiums to participate in a federal program that offers compensation when milk prices drop; but farmers want fair prices, not subsidies.

After four years of low prices, experts expect a minimal price increase in 2019, but predict many dairy farmers will continue to struggle. University of Wisconsin dairy economist, Mark Stephenson, predicts an increase of about a $1 per hundredweight, or hundred pounds of milk.

That still isn’t enough to bring them up to cost of production. Many dairy advocates are calling for a return to New Deal-era commodity supply controls. A similar system currently exists in Canada, where farmers there enjoy $27 per hundredweight of dairy.

“For the sake of both the environment and for rural people, we ought to be promoting small and medium agriculture as opposed to industrial. Having more family farms and less industrial operations is easier on the environment and better on the economy. Family farmers have a vested interest in protecting the environment long term -- they’re not just interested in turning a profit and leaving the area. Having more small scale farms over one big operation provides just as much opportunity for employment, but longer term opportunities, seeing as the smaller operations have multigenerational intentions,” Mitch said.