Holland Reporter

House Financial Services Oversight and Investigations Subcommittee Chairman Bill Huizenga (R-MI) and Michigan farmer Bill Schultz recently testified before a committee to discuss the potential negative impact of the Securities and Exchange Commission's (SEC) proposed climate rule on family farms and small businesses.

During the hearing, Congressman Huizenga expressed his concerns about the SEC's proposed climate disclosure rule, stating, "Congress created the SEC to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation—not to advance a progressive climate agenda." He pointed out that the proposed rule could cost reporting companies up to $25 billion annually, with little consideration for how it would affect small businesses that cannot afford a compliance department. Huizenga also questioned SEC Chairman Gary Gensler's ability to convince his fellow commissioners and the American people of the necessity of this rule.

Schultz, Vice President of Schultz Fruitridge Farms in Mattawan, Michigan, shared his perspective as a farmer who grows a variety of crops and operates a U-Pick farm market and farm-to-table restaurant. He emphasized the importance of his farm's connection to the community, stating, "We are our community's farm in so many ways and I fear the SEC's rule could put our industry at risk."

Schultz specifically highlighted the burden that the proposed rule's reporting requirements would place on family farms. He explained that the rule would require extensive reporting on scope 3 emissions, which are emissions resulting from activities in a company's supply chain. As family farms often supply products to public companies like grocery stores and fertilizer companies, they would be directly impacted by these reporting requirements. Schultz expressed concern that complying with the rule would be significantly more difficult and costly for family farms compared to large multinational companies.

Furthermore, Schultz emphasized the importance of environmental stewardship in farming and how his farm has adopted conservation practices to protect the land and ensure its sustainability for future generations. He also pointed out the unique challenges that farming presents, such as long periods for crops to mature and the unpredictability of weather and pests. Schultz argued that the SEC failed to consider these complexities when drafting the rule.

In conclusion, both Congressman Huizenga and farmer Bill Schultz raised valid concerns about the potential negative effects of the SEC's proposed climate rule on family farms and small businesses. They highlighted the financial burden, compliance difficulties, and potential consolidation of the industry that could result from this regulation. Moreover, they emphasized the importance of supporting family farms as vital contributors to the agricultural industry and rural communities.

As the debate over the SEC's proposed climate rule continues, the impact on family farms and small businesses remains a significant concern that needs to be addressed.