A regulatory cost assessment of ornamental aquaculture farms in Florida

Abstract

The ornamental aquaculture trade is a diverse sector of aquaculture and faces unique challenges that other commodity groups do not have to contend with. The various production techniques, species, and destination markets make ornamental aquaculture an interesting study in how regulations impact the industry. In Florida, aquaculture is primarily regulated under the Florida Department of Agriculture and Consumer Services, unique from other states.Regulatory costs and the value of lost production on ornamental farms in Florida were estimated to be $5.2 and $23.2 million, respectively. Results from an industry-wide census have shown that there is a high regulatory burden on ornamental farmers for some regulatory categories.These include issues of legal control of fish-eating predators, the restriction of drugs and chemicals, which would be beneficial to production, and the prohibition for farmers to raise species that have been restricted for culture at the national and state level. Larger farms were also able to limit the impact from regulations better than smaller farms by spreading their regulatory costs and value of lost production across greater sales. Although the values of lost productionSignificance statement: This study provides the costs and value of lost production due to regulations for the ornamental aquaculture industry in Florida.The results of this study will help to streamline the regulatory framework for ornamental aquaculture farmers in Florida and help to grow the industry as a whole.

Resilience of Communities and Sustainable Aquaculture: Governance and Regulatory Effects

“…Additional negative social effects from over-regulation of aquaculture include disproportionately negative effects on smaller-scale farms and suggest that increasing regulatory costs have contributed to the loss of small-scale aquaculture farms in the U.S. (Figure 2). Similar trends were found on Florida ornamental fish farms [157]. The greater negative effect on small farms occurs because regulatory costs are primarily fixed costs, and smaller farms have lower volumes of production across which to spread fixed costs.…”

“…In addition to direct regulatory compliance costs, sales were lost when regulatory requirements either forced farms to reduce production capacity, prevented farms from access to markets, or prevented farms from expanding to meet new market demand. Lost sales were estimated to be $6.9 million for U.S. baitfish/sportfish farms [154], $23 million on Florida tropical farms [157], $35 million on catfish farms [156], $52.5 million for salmonid farms [155], and $280 million for Pacific Coast shellfish farms [145].…”

“…Small-scale farmers may benefit from a BMP governance-based regulatory framework that facilitates compliance with customer expectations on quality, safety, and environmental performance of aquaculture products [173]. Specifically, establishing a single-agency clearinghouse that enhances collaboration among agencies and the use of Best Management Practices offer opportunities to embed flexibility into the regulatory process and reduce regulatory costs [33,157].…”

Cost of regulations on US catfish farms

“…Studies quantifying the regulatory costs on aquaculture farms are relatively new but increasingly important as they create a better understanding of the types and extent of the regulatory burden on farms. Such studies in baitfish, salmonids, shellfish, and ornamental industries have demonstrated that the effect of regulations on aquaculture farms stretches beyond the simple costs of permits and licenses (Boldt et al, 2022; Engle et al, 2019; van Senten & Engle, 2017, 2020). Increased production costs resulting from compliance, time spent on record keeping, and foregone revenue in the form of lost production, the value of markets lost from regulations, or the value of lost business opportunities—all contribute to reduction in producer surplus and negatively affect total societal welfare.…”

“…Regulatory costs contributed 12% of the total production and marketing costs on salmonid farms (Engle et al, 2019), 29% on Pacific coast shellfish farms , and 26% on ornamental fish farms in Florida (Boldt et al, 2022). Per-farm regulatory costs were $148,554/farm on baitfish/sportfish, $150,506/farm on salmonid, $240,621/farm on Pacific coast shellfish, and $173,135/farm on Florida ornamental farms (Boldt et al, 2022;Engle et al, 2019;; van Senten & Engle, 2017).…”