The Oregon Department of Agriculture (ODA) and the Oregon Department of Environmental Quality (DEQ) must deny a permit for the proposed Easterday Dairy to operate a 30,000-cow mega-dairy near the town of Boardman, Oregon.

Why deny the permit?

First, the Lower Umatilla Basin, the site of this proposed industrial operation, was designated a Groundwater Management Area (GWMA) in 1990 due to nitrate/nitrogen concentrations exceeding 7 milligrams per liter (mg/L). Nitrate concentrations in drinking water are linked with serious health concerns for infants and pregnant or nursing women, not to mention contributing to a variety of cancers and other health conditions.

In the more than 30 years since that designation, recent testing of drinking water from wells that draw from the groundwater shows the situation has grown even more dire. Even households that were fitted with reverse-osmosis filters designed to filter out nitrates were shown to have levels of the pollutant "between 29 parts per million to nearly 48 parts per million—up to nearly five times the federal safe limit" according to an article in the Oregon Capital Chronicle. 

In the same article, it quotes the technician who called with the test results from the six samples as asking, "No one is drinking this, right?"

Because of the extreme levels of nitrate pollution in the groundwater, mostly from agricultural sources, Morrow County has declared an emergency and the federal Environmental Protection Agency (EPA) is considering using its emergency authority to intervene in the region.

The technician who called with the test results from the six samples
of water asked, "No one is drinking this, right?"

Then there's the history of the specific site of the proposed dairy. Initially developed as the 30,000-cow Lost Valley Farm—which has been reported on extensively here—owner Greg te Velde began building even before he had state permits in hand. In 18 months of operation, the state issued more than 200 citations for environmental violations ranging from overflowing manure lagoons, cows forced to stand in their own filth and dead animals overflowing a dumpster. Te Velde himself was arrested in a prostitution sting and charged with felony meth possession. Lost Valley declared bankruptcy in 2018.

The scion of the vast Easterday Farms agricultural empire in Washington State, Cody Easterday, bought the failed facility for $66.9 million in early 2019, promising to clean up the heavily polluted land and restore it to profitability. Renamed Easterday Dairy, it almost immediately ran into its own set of soap opera-worthy dramas.

Cody himself turned out to have a gambling problem, which led him to create a "ghost herd" of cattle to disguise his debts, eventually pleading guilty to defrauding Tyson Foods, Inc., and another company out of more than $244 million over a period of six years by charging them for the purchase and feeding of more than 200,000 cattle that existed only on paper.

Easterday Dairy intentionally applied almost three times the allowable amount of nitrogen fertilizer on the property during the 2021 crop season.

Those troubles exacerbated the issues with the dairy, with the state putting an indefinite "pause" on the permit even though the Easterday family replaced Cody's name on the permit with that of his 25-year-old son, Cole. Moreover, according to the Kennewick, Washington, Tri-City Herald, "despite a January 2021 warning about nitrate levels, the landowners say Easterday Dairy intentionally applied almost three times the allowable amount of nitrogen fertilizer on the property during the 2021 crop season."

Then in July of this year, facing years of delay and with mounting financial issues and more violations even with no animals onsite, Easterday proceeded to sue the former owners of the property for breach of contract, asking for $14 million in damages or to be released from the purchase agreement, according to several news sources.

The issues with increasing nitrate pollution from decades of state mismanagement in the region, which is also experiencing increasing drought conditions due to climate change along with a drain on the at-risk aquifer from agricultural uses, should by itself condemn the permit. But the catastrophic damage at the site and the actions of the owners speak to the need for a permanent denial of another mega-dairy for the good of the environment, the people in the community, and the air, water and groundwater we all share.

Top photo from Stand Up to Factory Farms. Photo of Cody Easterday from Easterday's public Facebook page. Drought map from Food and Water Watch.

A coalition of community, small farms and environmental groups is collecting signatures on a petition demanding that Governor Kate Brown deny Easterday Dairy a permit to open a 30,000-cow mega-dairy on the site of the disastrous Lost Valley Farm just outside of Boardman, Oregon.

Their timing may be fortuitous, since last month the Oregon Department of Agriculture (ODA) released a finding that the property was found to have elevated levels of nitrates in the soil, a dangerous pollutant known to cause methemologlobinemia, or “blue baby syndrome,” in infants, as well as the risk of elevated heart rate, nausea, headaches, abdominal cramps and an increased chance of cancer, especially gastric cancer, in adults.

So far the group Stand Up To Factory Farms has collected more than 1,400 signatures on the petition it plans to present to Governor Kate Brown tomorrow. (If you are interested in signing the petition, you can do so here.)

This is the second permit application the Easterday agricultural conglomerate has made to the ODA. The first application was withdrawn by Cody Easterday after the ODA put it on "indefinite hold" when Easterday pleaded guilty in federal district court to defrauding Tyson Foods, Inc., and another company out of more than $244 million over a period of six years by charging them for the purchase and feeding of more than 200,000 cattle that existed only on paper, a scheme dubbed "Cattlegate." Many of the other Easterday family holdings subsequently declared bankruptcy in court.

In July, a permit application naming Cody Easterday's 24-year-old son, Cole, as the applicant was filed with the ODA in a move widely seen as a desperate ploy to keep the property that the Easterday's bought for $66.7 million in 2019. An article in the Capital Press at the time said Easterday had plans to invest another $15 million in upgrades, including completion of a wastewater treatment system that was never finished, as well as bringing the farm into full environmental compliance.

According to a Stand Up To Factory Farms press release, “a broad swath of community, environmental, animal welfare and public health organizations have raised concerns given the Easterday family’s financial distress, the outsize impact mega-dairies have on drinking water quality, climate change, and the enormous quantities of water they use.”

The coalition notes that the mega-dairy, located on a federally designated Groundwater Management Area (GWMA), would use “20 million gallons of water per day in the midst of a historic mega-drought and generate 128 million gallons of manure-contaminated waste water in an area with dangerously high nitrate levels [already] in the community’s drinking water.” (See my article, "Big Milk, Big Issues for Local Communities" about the problems these industrial-scale factory farms present.)

Read more of my coverage of the Easterday Dairy story.

Top photo from Stand Up to Factory Farms.

Big news broke yesterday about the Easterday Dairy application to restart a 30,000-cow operation on the site of the catastrophic Lost Valley Farm mega-dairy in Boardman, Oregon.

According to a press release from Stand Up to Factory Farms, a coalition of consumer and environmental public interest groups, the Oregon Department of Agriculture (ODA) and the state Department of Environmental Quality (DEQ) announced that the agencies had temporarily suspended work on the pending Easterday Dairy permit because of legal concerns.

The "pause" of the permit was announced by the ODA's CAFO program manager, Wym Matthews, at a meeting of the state CAFO Advisory Committee, which provides feedback to the department about its Confined Animal Feeding Operations (CAFO) Program.

Cody Easterday, whose name and signature appear on the ODA permit application, pleaded guilty on March 31st in federal district court to defrauding Tyson Foods, Inc., and another company out of more than $244 million over a period of six years by charging them for the purchase and feeding of more than 200,000 cattle that existed only on paper.

In a scheme that has been dubbed "Cattlegate," Easterday pleaded guilty to wire fraud—making use of electronic media including telephone or fax machine, email or social media, or SMS and text messaging—which he allegedly committed in order to cover up his massive losses on the futures market. His trading activities are the basis for another pending federal matter against Easterday that is being brought by the Securities and Exchange Commission.

The Easterday family, which Cody has headed since the death last fall of his father, Gale, has extensive holdings in Washington and Idaho. Two of the family's largest companies, Easterday Farms and Easterday Ranches, have declared bankruptcy in the wake of the scandal.

In the advisory committee hearing, Matthews said that the bankruptcies of these two major parts of the family's businesses appear to touch on parts of the proposed Oregon facility and are a major reason for pausing the permit process. "The Oregon property is in question at this time," he said. "The applicant status and ownership status [of the dairy] is potentially in question, which would cause us to pause."

In an e-mail response to my questions, ODA communications director Andrea Cantu-Schomus said that while the permit application itself is still active and pending, the Oregon Department of Justice continues to gather information about this rapidly evolving situation.

“It’s a relief to hear that ODA and DEQ have stopped work on the permitting process for Easterday Dairy,” according Stand Up to Factory Farms coalition organizer Emma Newton. “Easterday’s failure to disclose fraud and major financial difficulties during the application process gives ODA and DEQ ample grounds for the permit’s denial." Calling the pause on the permit a first step, Newton calls on the agencies to "deny the Easterday Dairy permit once and for all.”

Read more about the Easterday scandal and the subsequent bankruptcies of Easterday Ranches and Easterday Farms. Get more information on the Lost Valley Farm debacle and the dangers that mega-dairies present to Oregon's rural communities, the health of its citizens, and the state's climate, environment, air and water.

In the growing scandal around the scheme that has been dubbed "Cattlegate," Easterday Farms is now tangled up in the bankruptcy of its sister company, Easterday Ranches, a giant ranching and feedlot operation in Washington state that filed for Chapter 11 bankruptcy protection earlier this month. The filing was made after a meatpacker sued Easterday Ranches for defrauding it of $225 million for 200,000 nonexistant cattle.

Cody Easterday, president and CEO of Easterday Ranches, one of the largest agricultural operations in Washington State, is implicated in a complex modern-day cattle rustling operation involving 200,000 "ghost cattle" that apparently existed only on paper. Easterday was contracted to buy and feed the bovines for Tyson Fresh Meats, a division of Tyson Foods, then deliver them to slaughter at Tyson's processing facility, invoicing Tyson for their purchase and upkeep. The problem was that he never bought the cattle, but still invoiced Tyson for them, allegedly intending to use the money to cover losses he'd incurred in the commodities trading market.

An article in the Spokane (WA) Spokesman-Review said that on Monday (2/8), Easterday Farms filed for Chapter 11 bankruptcy seeking protection from its creditors. It said "according to court records made public Tuesday (2/9), Easterday Farms has and continues to sell feed to the ranch side of the business that has been caught up in an alleged scandal of missing cattle owned by Wallula-based Tyson Fresh Meats Inc., a subsidiary Tyson Foods Inc."

In addition to being the president and CEO of Easterday Ranches, Cody Easterday is also the head of Easterday Farms—one of the many sprawling and intertwined holdings of the Easterday family that includes private planes, hangars, giant storage and packing sheds, restaurants and million-dollar homes. On its 18,000 acres in the Columbia Basin, Easterday Farms grows onions, potatoes and other produce, plus feed and grain for the cattle in the family's feedlot operations.

Easterday Farms is also the owner of the former Lost Valley Farm, the 30,000-cow mega-dairy that failed catastrophically in 2018 when the Oregon Department of Agriculture (ODA) shut it down after issuing more than 200 violations of its permit in two years of operation. It cost millions to clean up the "environmental mess"—including 30 million gallons of manure and wastewater—left by the previous owner.

At the time of the sale in 2019, Easterday was required to reapply to the state ODA for a Confined Animal Feeding Operation (CAFO) permit to operate a 28,300-cow mega-dairy on the site, which it did under the name "Easterday Farms Dairy." While the ODA issued a "letter of satisfaction" at the end of 2019 for the cleanup at Lost Valley Farm, according to sources the Easterdays will still need to invest $15 million to bring the facility into full environmental compliance.

Cole Easterday, a co-owner of the new dairy business, said, "Though the situation with Easterday Ranches and Easterday Farms is unfortunate, Easterday Dairy LLC’s commitment to our current CAFO permit and our permit application is unchanged,” according to an article in the Capital Press.

The article quotes Stephanie Page, natural resources program director for the ODA, as saying that the lawsuit and bankruptcy potentially add another layer of complications. "I think we’ve all been on the same page in terms of not wanting to jump to conclusions," Page said. "We’re just continuing to evaluate the info we’ve gotten about the business structures, and how they’re separate but also making sure we understand how they’re interrelated."

In an e-mail, ODA communications director Andrea Cantu-Schomus said that the ODA and the state Environmental Protection Agency (EPA) are "required by Oregon law and EPA CAFO rules to consider all applications and issue permits for facilities that meet all legal requirements."

When asked whether the bankruptcy filings may impact the viability of Easterday's operations at the dairy, she said that the agencies are exploring Oregon Revised Statutes* and federal rules for CAFOs to determine whether they have the authority "to verify the ongoing financial status of an applicant and or operator" in the permit review. She termed the lawsuits and bankruptcy filings "a rapidly evolving situation" and that "the state will proceed with integrity and transparency."

Though this is hardly the ODA's first rodeo when it comes to issuing permits to large industrial facilities that go on to create problems.

“We know from experience that ODA and DEQ are likely to claim they don’t have the authority to deny Easterday’s permit,” said Tarah Heinzen, Food & Water Watch Legal Director. “Recent events underscore that this is just not true. They can deny a permit to any applicant who hasn’t disclosed all relevant facts or who has misrepresented any facts in their application. Easterday Ranches’ and Easterday Farms’ significant financial distress surely qualifies.” 

Cantu-Schomus later clarified in an e-mail when asked about whether the agencies are able to put a permit application on hold while determining its status that "there is no time requirement for ODA or DEQ to complete CAFO Permit development and start the public notice period."

Adding pressure to the ODA's permit process, a coalition called Stand Up to Factory Farms is pushing a bill in the state legislature for a mega-dairy moratorium in order to institute regulations on industrial factory farm dairies to protect Oregon's environment, air and water and the health of its communities.

In light of the Easterday scandal, the coalition issued a press release saying that "denying the [Easterday Farms] permit is not enough. It’s been clear for years now that these facilities housing tens of thousands of cows and producing waste on par with many cities are mega-polluters regardless of the operators. It is time for Oregon legislators to enact a mega-dairy moratorium to protect our state from irresponsible mega-dairy operators and prevent harms from massive industrial dairies until regulations are in place to protect Oregonians."

Amy van Saun, a senior attorney for the Center for Food Safety, responded in an e-mail to a question about the Easterdays' various businesses, "While the intricacies of the various Easterday entities may not yet be clear, including to state regulators, one thing is clear: Cody Easterday and the Easterday family are the principals and the ones accused of massive fraud in Washington.

"It is beyond the pale that ODA and DEQ would still consider permitting the Easterdays to operate such a massive new source of nitrates and methane in Oregon," van Saun wrote.

Read more about the Easterday Ranches scandal.

* ORS 468B.217 and OAR 340-045

Photos from Easterday's public Facebook page.

It has the drama and intrigue of a Hollywood blockbuster—part western, part heist movie—centered on a middle-aged businessman up to his eyeballs in debt desperately trying to dig his way out scheming to rip off a giant national meat conglomerate, contracting to deliver thousands of cattle that only exist on paper.

Thing is? This is no movie, it's real.

Even weirder, it involves the catastrophic Boardman-area mega-dairy known as Lost Valley Farm—infamous for its drug-addled, prostitute-frequenting former owner, Greg te Velde, who racked up more than 200 violations of its operating permit in two years—and the scion of a multi-generational Northwest ranching family who swooped in and bought the failed dairy, proposing to infuse millions of dollars to bring it back to profitability.

The panicky businessman is Cody Easterday, president and CEO of Easterday Ranches, one of the largest agricultural operations in Washington State, who is also the main player in the Lost Valley Farm purchase. A tragic side note: His father, wealthy cattleman Gale Easterday, died in December when the car he was driving ran head-on into an 18-wheeler hauling Easterday potatoes.

Reporter Anna King of the NW News Network broke the story that Cody had lost more than $200 million in the commodities market and had concocted the  scheme in a bid to cover his losses. “As his commodities trading losses escalated, Mr. [Cody] Easterday explained that he began submitting fake feeding invoices as well as the fake cattle invoices,” Jason Wenglarski, vice president of internal governance for Tyson Foods, is quoted as saying.

The story describes Easterday's scheme to contract with Tyson "to buy fake young cattle, then charge Tyson for them. Then Easterday Ranches would fictitiously feed the cattle and bill Tyson for that feed. Next, the cattle operator would deliver some actual cattle—but not all—to Tyson when the on-paper cattle would be market ready."

Interestingly, Tyson didn't discover the discrepancy for several years, according to the Tri-City Herald, which said Easterday had previously worked with Tyson for many years when, in 2017, Easterday signed an agreement to buy young cattle and feed them until they were ready for market, submitting invoices and being reimbursed for his costs.

According to Tyson's lawsuit against Easterday, the scheme came to Tyson's attention in late November of 2020 when it discovered "errors" in its inventory records and met with Easterday. “Its investigation, including the admissions of Defendant’s President Cody Easterday, showed there were over 200,000 head of cattle that Defendant reported to be in inventory, but which did not exist.”

As for Easterday's pending permit application with the Oregon Department of Agriculture (ODA) to operate a 30,000-cow mega-dairy on the former site of Lost Valley Farm? At this point it's unaffected by the recent revelations.

According to ODA communications director Andrea Cantu-Schomus, "the State is continuing the process of reviewing the Easterday Farms Dairy LLC application and drafting a permit." She added that when the draft permit is ready, the ODA and Department of Environmental Quality will release it and any supporting materials to the public prior to holding public hearings. Based on that, the agencies "will review and make possible changes" before making a final decision on the permit.

Stand Up To Factory Farms, the coalition of community, farm, environmental and social justice organizations behind the mega-dairy moratorium before this year's legislature, issued a press release on the Easterday scandal, saying "these serious allegations underscore that Lost Valley Farm’s owner, Greg te Velde, is not the only 'bad actor' among mega-dairies, as the Oregon Department of Agriculture and the dairy lobby would have us believe. It is vital that the Oregon Department of Agriculture immediately deny the Easterday permit application for a new mega-dairy in Eastern Oregon."

Until then—or until the movie comes out—I'll keep you posted on developments and/or shenanigans.

Top photo: File photo of cattle feedlot.