News

State threatens to yank permits from Ohio Fresh egg farm

October 6, 2005

SALEM, Ohio – The state department of agriculture is again threatening to shut down Ohio Fresh Eggs.
Late last week, Agriculture Director Fred Dailey proposed revoking all the farm’s permits for 12 operations in Licking, Hardin and Wyandot counties, saying company managers lied on permit applications.
Requirements. Ohio Revised Code requires farm permits to include names and addresses of anyone who controls or has right to control farm management, selection of officers, directors or managers.
A year ago, egg farm owner-managers Don Hershey and Orland Bethel told ODA an anonymous investor held an option to purchase into the company, according to ODA spokesman Bill Schwaderer.
That investor was later found to be Austin “Jack” DeCoster after the man’s attorney, Jerry Crawford, came forward to inform the department of agriculture of his client’s situation.
The option to purchase means DeCoster has the opportunity to purchase either Ohio Fresh Eggs’ shares or assets through 2020, with the option to extend that decision through 2030.
Managers. Schwaderer said the department did further checks and found DeCoster was also making management decisions for the farms.
However, DeCoster’s name never appeared on any of the company’s permits.
Permits listed owners as Donald Hershey and Orland Bethel, and operators as Ronald Flory and Mohamed Mousa Aboughazala. Aboughazala resigned effective Aug. 31 of this year.
“Operating permits require anyone with power to make management decisions has to undergo a background check, where we look at their environmental compliance over the past five years,” Schwaderer said.
“We would have found [DeCoster’s] compliance history was not too good at that time,” Schwaderer said.
Problem history. In the past, DeCoster was labeled a “habitual” and “chronic” violator of Iowa’s environmental laws, according to the Ohio Department of Agriculture.
The classification as habitual means DeCoster had committed three or more violations within five years at a confined animal feeding operation that caused water pollution.
Records show DeCoster was fined at least $170,000 for manure spills at hog farms he operated in Iowa.
The state says DeCoster “has a history of substantial noncompliance with laws pertaining to environmental protection” and that he “lacks sufficient reliability, expertise, and competence to operate” a CAFO in Ohio.
Like a bank. The egg farm had previously told ODA DeCoster “could not be classified as anyone in control of the management at [Ohio Fresh Eggs],” according to state records.
Ohio Fresh Eggs maintained DeCoster “would exercise no more oversight or control over [the farm] than a bank would.”
Those same records show DeCoster, as the one-person limited liability corporation Ohio Investments Co., lent money to Ohio Fresh Eggs’ Bethel and Hershey in April 2003 for the deposits to purchase egg farms near Croton, Ohio, and later for the actual purchase.
DeCoster apparently also lent money for the purchase of the Goshen Pullet Site in Hardin County and layer sites at Mount Victory in Hardin County and Marseilles in Wyandot County, according to the proposed revocation order.
Investigation. Agriculture director Fred Dailey said the state has investigated the matter thoroughly and considers the consequences very serious.
“If it is determined these permits were based on false or misleading information, Ohio law makes it very clear they must be revoked.
“This poultry farm deserves owners and operators that conduct themselves with integrity and honesty, and are committed to being good neighbors.”
Ohio Fresh Eggs spokesman Harry Palmer says the company will appeal the state’s order. The farm has until Oct. 30 to file that appeal.
“We intend to continue to operate and improve the farms as we have for the past two years,” Palmer said.
(Reporter Andrea Myers welcomes reader feedback by phone at 1-800-837-3419, ext. 22, or by e-mail at amyers@farmanddairy.com.)