Published 3:30 pm Tuesday, August 15, 2023
BOARDMAN, Ore. — The Easterday family is walking away from years of work to reopen Oregon’s second-largest dairy in Morrow County.
Easterday Dairy is selling its portion of the property back to Canyon Farm II LLC, a subsidiary of Fall Line Capital based in San Mateo, Calif., for $15.2 million.
The sale was first reported by the Tri-City Herald and confirmed by the Oregon Department of Agriculture.
ODA spokeswoman Andrea Cantu-Schomus said Fall Line Capital now assumes all liabilities for the dairy, including compliance with a state-issued water quality permit.
In an email to the Capital Press, Cantu-Schomus said the agency “worked with both parties to ensure the property sale included an agreement for continued permit compliance protecting ground and surface water on the site.”
As part of the permit, no animals are allowed on the property and Fall Line Capital must continue to test groundwater and wells for pollution.
Cantu-Schomus said the state also secured a $1.5 million letter of credit from Fall Line Capital, providing assurance the site will comply with its permit requirements.
The sale marks another twist in the troubled history of the dairy, which started as Lost Valley Farm in 2017.
California dairyman Greg te Velde first bought the 7,287-acre site along Homestead Lane east of Boardman. Prior to that, the land had been part of the expansive Boardman Tree Farm, which grew hybrid poplars to make into plywood.
Lost Valley Farm sought to have 30,000 cows producing milk for a nearby Tillamook Cheese plant. Instead, the operation collapsed a year later after racking up hundreds of violations related to wastewater management.
Te Velde declared bankruptcy, and a court-appointed trustee oversaw the cleanup and sale of the property to Canyon Farm in 2019.
The Easterdays entered into a lease with Canyon Farm and aimed to revive the dairy, pledging $15 million to upgrade and complete wastewater treatment systems that would bring them into full environmental compliance.
Easterday Dairy applied for a new permit from ODA and the state Department of Environmental Quality to bring cows back on site. Meanwhile, the surrounding farmland was still being used to grow potatoes, sweet corn, alfalfa and other crops.
The dairy business is run by Cole, Clay and Cutter Easterday.
Their father, Cody Easterday, is the former president of Easterday Farms and Easterday Ranches in Pasco, Wash. He was sentenced to 11 years in prison in 2022 for defrauding Tyson Foods and another company out of $244 million as part of a “ghost cattle” scheme.
Earlier this year, ODA alleged that Easterday Dairy violated its permit 36 times between July 19 and Sept. 17, 2022. The offenses included multiple instances of fertilizer spills and over-irrigating fields, allowing nitrogen-rich water to pool and run off of farmland.
The property is located within the Lower Umatilla Groundwater Management Area, which was designated in 1990 due to high levels of nitrate in groundwater.
But according to a court filing by Cole Easterday, these violations occurred on land he and his brothers were not actually managing.
The property had been split into two parcels — a 736-acre “dairy parcel” owned by Easterday Dairy, and a larger 6,542-acre “farm parcel” owned by Canyon Farm and leased to another company, Walther Farms, beginning in 2022.
Easterday Dairy and Cole Easterday filed a lawsuit against Fall Line Capital, Canyon Farm and Canyon Farm II over the farm’s management. The sale of the dairy parcel back to Canyon Farm was part of recent closed-door settlement in the case.
“While this is not the outcome we intended when we first purchased the dairy, this settlement will allow our family to shift all of our focus into our farming operations in the Columbia Basin,” Cole Easterday said in a statement. “Our family remains committed to caring for the people we work with, the land that we farm, and the crops that we grow here.”
Environmental groups had fought against reopening the dairy, with Tarah Heinzen, legal director for Food & Water Watch, calling the Easterdays’ withdrawal “a major win for Oregon’s communities, water and climate.”
“But this eventuality should have come far sooner,” Heinzen said. “Oregon agencies should have denied the permit outright. This years-long fiasco shows that Oregon’s environmental regulations are far too lax; we will fight harder to enact a moratorium on these polluting operations.”
The Oregon Legislature passed Senate Bill 85, imposing stricter rules for “confined animal feeding operations,” or CAFOs, with lawmakers citing the failures at Lost Valley Farm.
Farm groups, including the Oregon Farm Bureau, Oregon Cattlemen’s Association and Oregon Dairy Farmers Association, opposed the bill.
