A Trip to the Douglas Port

referred to as a capital gain or loss, which is then federally taxed. A step up in basis reduces the capital gains realized by the inheriting generation because the calculation is based on the appreciation of the land during their ownership rather than since the original family purchase. Since land typically appreciates over time, an elimination of or tax on step up in basis would disproportionately impact generational transfers in agriculture.

Despite the proposed legislation not including this change, it is not completely off the table. The proposed legislation is not set in stone yet and such a change may easily be added back through the extensive revision process prior to congressional approval. Additionally, Biden’s “American Families Plan” released on April 28, 2021, supports limitations on the existing step up in basis.

Although the current elimination of changes to step up in basis are a move in the right direction, changes negatively impacting the generational transfer of farms and ranches are inevitable under the current administration. Estate taxes can bankrupt an operation, so farmers and ranchers need to reassess their estate plans to protect their operations for future generations. Hopefully, our country will realize the disastrous implications of taxing agriculture out of business before it is too late. In the meantime, estate planning is one of the most powerful tools we can use to keep the industry alive for the next generation.

Katherine E. Merck is an Associate Attorney with Budd-Falen Law Offices, LLC with a primary focus on property rights, environmental, and natural resources law. Budd-Falen Law Offices, LLC, has attorneys licensed to practice law in Colorado, Idaho, Illinois, Montana, Nebraska, New Mexico, North Dakota, South Dakota, Texas, and Wyoming. This article should not be understood to state or imply that any lawyers of this law firm are certified as specialists in a particular field of law. Colorado does not certify lawyers as specialists in any field. The Wyoming State Bar does not certify any lawyer as a specialist or expert. Anyone considering a lawyer should independently investigate the lawyer’s credentials and ability, and not rely upon advertisements or selfproclaimed expertise. This article is informational and is not legal advice. Use of this article or contact with this law firm does not create an attorney-client relationship. ▫

by Suzette dePersio, Assistant State Veterinarian, Arizona Department of Agriculture

Douglas, Arizona, is a city in Cochise County nestled against the Mexico border and home to a port where, since 1989, over 8 million cattle have moved through from Mexico to the United States. These cattle are fed out at U.S. based feedlots and contribute millions of dollars towards industry and commerce, as well as to help ensure a secure food supply. On October 19th, representatives from the Arizona Department of Agriculture (AZDA) - Animal Services Division (ASD) – State Veterinarian’s Office (SVO), Livestock Inspection Services, and the United States Department of Agriculture (USDA) – Animal and Plant Health Inspection Service (APHIS), met in Douglas to have meetings with representatives of ranchers in the community, as well as Mr. Suarez of Suarez Cattle Brokerage Co. The goal of this visit was to discuss the challenges that producers in the area face, as well as to view the crossing of cattle from Mexico into the United States. Those in attendance from AZDA included Inspector Luis “Beto” Romero, Jerome Rosa, Dr. Ryan Wolker, Dr. Suzette dePersio, Dr. David Byerly, Dwayne Uhlig, and Captain Terry Lincoln. USDA participants included Dr. Cody Egnor, Dr. Toria Davis-Foster, and Animal Health Technician Oscar Maldonado. During the first meeting with ranchers in the area, our group held a productive conversation and identified the need for continued and improved coordination and communication among all parties present. Topics of discussion included finding ways in which the ASD can better serve Arizona producers, how producers can have their voices heard, and how both groups can work together to support and improve cattle production in the state of Arizona. Afterwards, an introductory meeting was held at Suarez Cattle Brokerage Co., before AZDA and USDA representatives headed to the border wall port of entry. Cattle crossing was to occur on the day of this visit but was unexpectedly canceled. Nevertheless, our group was able to glean valuable insights into the process of cattle movement at the port. Inspector Romero was a fantastic guide, and walked the AZDA/ USDA team through the process that takes place during cattle movement. This guided tour and site visit was eye opening and provided opportunities to view ways in which operations at the port can be improved.

Suggestions for improvement at Arizona ports of entry were generated after this visit and included employing inspectors to be present at border ports during cattle movement, as well as instituting consistency in tagging and tracking of cattle once they reach the U.S. This can be done by having all cattle tagged with high frequency RFID tags. These tags would provide an efficient means of tracking cattle to their final destinations within the U.S., thereby improving the effectiveness of animal disease traceability (ADT). These improvements will help increase the speed of commerce for all parties involved. While there is still more work to be done, such as an upcoming visit to the New Mexico border port of Santa Theresa, the AZDA team is hard at work to facilitate improved border operations. ▫

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