Site Visit: Small Business Hatches Ideas to Ease Its Industry’s Regulatory Burdens
By Prianka Sharma, Assistant Chief Counsel
On June 8, Assistant Chief Counsel Prianka Sharma and Regional Advocate Apollo Fuhriman traveled to Cedar Key, Florida, to hear from the aquaculture industry. After touring a hatchery, and going out on a boat to see leases on the water, they participated in a roundtable with small business members of the Cedar Key Aquaculture Association.
While touring the hatchery, Sharma and Fuhriman learned about how shellfish are raised in hatcheries and how precise business owners must be with the salinity of water, the types of algae they are feeding the shellfish, the temperature of the water, and ensuring that no contaminants get into the hatcheries. One fact that Advocacy staff did not know is that shellfish can survive outside of water for more than one day!
In speaking with industry members, Advocacy learned that there are several challenges within the industry. Small businesses spoke about current Food and Drug Administration testing procedures for red tide, stating that the procedures have not been updated since the 1950’s. This procedure injects mice with a serum from sample shellfish and measures the rate at which the mice die, presumably from red tide poisoning. The small business owners stated that FDA is moving slowly at adopting a new method for testing, and that this is causing industry delays in being able to once again work in harvesting areas that are no longer contaminated.
Small business representatives also spoke about workers compensation insurance. One employee stated that he has been working in the industry for nearly 17 years but has been treated as a 1099 employee because small businesses cannot afford to pay for the insurance required for those who work on the water, and traditional workers compensation policies do not cover those who work in jobs on the water. He stated that this means that after working for the company for nearly 20 years, he does not have any retirement, nor adequate health benefits. One business owner stated that to ensure his crew who work on the boats is sometimes upwards of $75,000.
They also stated that shellfish have to be handled with care from the moment they leave the small business until they are served to the consumer; there are issues with traceability when a bad batch is sold to a consumer who suffers illness. Oftentimes small businesses get credited for incidents when the product was improperly handled by a restaurant or grocer and not at the front end of the sale. This causes these small businesses to take a hit to their record, and be on the radar of inspectors for more frequent inspections. Because shellfish are subject to so many inspections, catering to these inspectors takes away time and resources from production, when the small business has not, in fact, been culpable for the illness or injury to the consumer in the first place. As one business owner stated, “I have more inspectors than employees.”
Business owners also spoke about burdensome paperwork, including the United States Department of Agriculture census. They stated that it is typically 80 pages in length and at least 70 percent of the forms do not apply to their businesses, but they are forced to comply with filling it out which takes roughly three to four hours. They stated that if USDA were to make the form digital, and once a company said “not applicable” to one question, blanked out automatically all other questions that do not apply based on the initial response, the form would only take them 15 minutes to complete.
Advocacy left feeling hungry for clams and oysters, and better informed of the challenges in being a small shellfish aquaculture business owner.
Advocacy was in Florida for Regional Regulatory Reform Roundtables June 5-7th.
Can’t get to a roundtable near you? Fill out this form and tell us about your federal regulatory burdens. We will pass this information on to the appropriate agency and use it in the planning of upcoming Regional Regulatory Reform Roundtables.
Prianka Sharma is an Assistant Chief Counsel for Advocacy whose portfolio includes natural resources, agriculture, and energy. Sharma can be reached at Prianka.sharma@sba.gov.