Restaurants cheer court block of Obama's overtime rule Presented by Boehringer Ingelheim Animal Health

With help from Jason Huffman, Doug Palmer, Annie Snider, Jenny Hopkinson and Catherine Boudreau

RESTAURANTS CHEER COURT BLOCK OF OBAMA’S OT RULE: Chain restaurants joined a chorus of GOP lawmakers and many in the small business community in hailing a Texas federal judge’s decision Tuesday to issue a preliminary injunction halting a Labor Department rule that would have expanded overtime pay as of next week. President Barack Obama’s signature wage intervention, which had been set to kick in Dec. 1, would double — to $47,476 — the salary threshold under which virtually all workers receive time-and-a-half pay whenever they work more than 40 hours in a given week. It was intended to restore overtime pay to millions of middle class workers after years of erosion reduced the perk to one enjoyed only by low-income earners, but the GOP and many in the business community, restaurant industry leaders among them, argued it would be prohibitively expensive.


The rule wouldn’t have applied to farmworkers, because they are exempt from key federal labor requirements, but it would have altered payroll considerations at many small businesses across the heartland. The Labor Department estimated it would cost businesses nearly $300 million per year. The preliminary injunction, issued by Judge Amos Mazzant, an Obama appointee to the Eastern District of Texas in Sherman, Texas, doesn’t end matters. But Pro Labor and Employment’s Marianne Levine writes that “Mazzant's decision signaled a strong likelihood that he'll eventually side with 21 state attorneys general and a coalition of business groups that sued to block the regulation.”

Temporary or not, the National Council of Chain Restaurants saw reason to be thankful just shy of Thanksgiving. “Judge Mazzant agreed with what NCCR and our coalition allies have been saying all along: that the Labor Department’s ill-conceived overtime regulation is a dramatic government overreach causing significant harm to small businesses and their employees around the country,” said Rob Green, NCCR executive director.

Pump the brakes: “The regulatory ‘timeout’ imposed by Judge Mazzant should allow Congress to vote to stop the regulation once and for all and would also let the incoming Trump administration create a more realistic and workable overtime solution based on sound economic considerations,” Green added. Read Levine’s full story here.

HAPPY WEDNESDAY, NOV. 23! Welcome to Morning Ag, where your host is cooking a full Thanksgiving dinner tomorrow, but still doesn’t exactly have a plan fleshed out. Help! (No really, calling all favorite recipes!) Send them to [email protected] or @hbottemiller. Follow the whole team at @Morning_Ag.

PROGRAMMING NOTE — Due to the Thanksgiving holiday, Morning Ag will not publish on Thursday, Nov. 24, and Friday, Nov. 25. Our next Morning Ag will publish on Nov. 28.

BEVERAGE MAKERS HAVE LONG ROAD AHEAD ON CUTTING CALORIES: The beverage industry’s progress toward its commitment to cut calories significantly by 2025 appears to be off to a slow start, according to a study, released Tuesday. Americans got 198.7 calories per day from beverages in 2015, on average — that’s just 0.2 percent less than in 2014, the year the industry set its aggressive target of a 20 percent reduction by 2025, according to Keybridge, a consulting firm based in Washington, D.C., that crunched national sales data.

Beverage industry leaders’ pledge to cut 20 percent of the calories attributable to their products by 2025 was a move many saw as a strategy to defuse some of the pressure the industry is facing as obesity and diabetes costs spiral and more politicians look at taxing soda. “This is not going to be a cakewalk,” Howell Wechsler, CEO of the Alliance for a Healthier Generation, said Tuesday. “I do believe this is a stretch for them; they are facing some real headwinds.”

The backstory: In 2014, the Alliance brokered the calorie cut commitment with the American Beverage Association, PepsiCo, The Coca-Cola Company and Dr. Pepper Snapple Group. At the time, pressure was ratcheting up on the beverage industry as more health advocates blamed sugary drinks for driving obesity and diabetes epidemics, and Berkeley, Calif., was about to become the first U.S. city to impose a hefty sin tax on sugary drinks. But Wechsler cautioned that just two years out is very early in the process to effectively measure the beverage industry's progress toward meeting its commitment. Companies have only recently started rolling out their reformulations and marketing efforts. Pros can find more on this story from yours truly here.

BEVERAGE M&A: While we’re here: PepsiCo and Dr. Pepper Snapple Group both snatched up small, fast-growing beverage companies this week in a bid to diversify as soda sales dwindle. Dr. Pepper Snapple Group reportedly will purchase Bai Brands LLC, which makes antioxidant drinks, for $1.7 billion in cash. PepsiCo reportedly will acquire KeVita Inc, which makes kombucha and other probiotic drinks, for an undisclosed sum. Reuters has more here.

IOWA LAWMAKERS WANT QUICK DEATH FOR WOTUS: Iowa Sens. Joni Ernst and Chuck Grassley, as well as Republican Reps. Rod Blum, Steve King and David Young, asked President-elect Donald Trump to stop the Obama administration’s Waters of the U.S. regulation within days of taking office. “We also respectfully urge you to direct your EPA to craft a common-sense rule that clarifies the scope of the CWA and does so by taking into consideration the input of all stakeholders,” they said in a letter.

VILSACK: U.S.-CHINA AG MEETINGS UNPHASED BY TRUMP TALK: The possibility of President-elect Trump starting a trade war with China is not distracting high-level agricultural talks this week between the U.S. and China, Agriculture Secretary Tom Vilsack said Tuesday. Instead, officials are staying focused on removing barriers to trade in the areas of beef, poultry and biotechnology.

"There hasn't been a discussion about the future," Vilsack told reporters after speaking to a group of U.S. and Chinese business people on the sidelines of the annual U.S.-China Joint Commission on Commerce and Trade meeting. "There's really a focus on the present."

There could be progress this week on at least some of the eight biotechnology products "ripe for approval" by Chinese regulators that have long been approved for use in the U.S., Vilsack said. He added that there also is more work to be done on beef trade. While China announced in September that it was lifting a ban on imports of U.S. beef that it imposed in 2003 after a mad cow disease incident, China has yet to invite U.S. officials to the country to work out quarantine issues. Until that invitation arrives, things are in a “holding pattern,” Vilsack said.

Meanwhile, the two sides have sparred for several years over poultry trade. The Office of the U.S. Trade Representative in May launched a new challenge against Chinese anti-dumping and countervailing duties on U.S. poultry, complaining that China had failed to comply with a previous ruling against the measures. At the same time, China has been pushing to get its chicken exports into the United States in the face of food safety concerns in Congress. Chinese Vice Premier Wang Yang referred to that issue during a speech on Tuesday, urging U.S. officials to create "a sound environment for the import of poultry meat and other agricultural products from China." Pros can find the full story from Pro Trade’s Doug Palmer here.

WHAT IS FIBER, ANYWAY? Is the fiber from brown rice on a level playing field with inulin or oat hull fiber? The FDA is asking for input on what exactly should be included in the definition of "dietary fiber" in the agency's sweeping update of the Nutrition Facts panel. When it released its final rule in May, the FDA said the definition included only naturally occurring dietary fibers and certain fibers added to foods that provide "physiological effects that are beneficial to human health" — which some corners of the industry felt was too narrow.

Today the agency also released draft guidance aimed at helping food makers understand how it reviews scientific evidence when looking at whether to add more types of fibers to the regulation. The agency will be accepting comments starting Nov. 23 for 45 days.

COURT REJECTS EFFORT TO REGULATE TREATED SEEDS: A federal court has found that EPA is not required under a 2013 guidance to regulate pesticide-treated seeds in addition to the pesticide, a two-pronged approach that environmentalists had argued is necessary to better protect bees. In a ruling Tuesday, Judge William Alsup of U.S. District Court for the Northern District of California found that the document that recommends that pesticide inspectors may also take into account dust and other contamination from treated seeds when investigating a pesticide poisoning incident is not a requirement for greater agency oversight of the products.

“The Court is most sympathetic to the plight of our bee population and beekeepers,” Alsup wrote in the 21-page ruling. “Perhaps the EPA should have done more to protect them, but such policy decisions are for the agency to make. A district judge’s role is limited to judicial review of final agency actions, which do not include the type of guidance involved here.” The Los Angeles Times has more on the ruling here.

NIXON: BAYER WILL KEEP NORTH AMERICAN HQ IN MO: In case you missed it, Missouri Gov. Jay Nixon said he has received reaffirmation from Bayer executives of their commitment to keep their North American headquarters in St. Louis after their planned merger with Monsanto. Nixon had a visit of nearly four hours with Bayer executives in Germany on Nov. 18 during which he stressed “the opportunities for further investment and growth both in St. Louis and at Bayer’s existing 240-acre Kansas City facility that provides more than 840 jobs,” according to a statement from Nixon’s office. Read the St. Louis Business Journal’s take on it here.

HOUSE AGRICULTURE COMMITTEE STAFFS UP: The House Agriculture Committee Democratic office has hired Troy Phillips as deputy staff director and Kellie Adesina as its senior counsel, ranking member Collin Peterson (D-Minn.) announced Tuesday. Phillips, a native of Macon, Mo., has worked for retiring Rep. Sam Farr (D-Calif.) since 1997, focusing on agriculture and natural resource issues, according to a statement. Most recently, he assisted Farr in the California Democrat’s role as ranking member of the House Appropriations Committee’s agriculture panel.

Adesina was an attorney at USDA, and before that served as a legislative director for Rep. Marcia Fudge (D-Ohio), a role in which she provided counsel on the 2014 farm bill, among other issues, per the statement. A native of Newark, N.J., she has also worked in the offices of Rep. Judy Chu (D-Calif.) and Sen. Robert Menendez (D-N.J.).

MA’S INSTANT OATS:

— Full-fat milk may be a better option for children, finds a new study. The New York Times explains why here.

— The vast majority of the country’s mega farms are still family-owned, FiveThirtyEight looks at the data.

— Vox takes a deep dive into the world of grocery store slotting fees. Read it here.

— Can a story about turkey insemination save your Thanksgiving dinner from devolving into an ugly political debate? Quartz has some ideas.

THAT'S ALL FOR MA! See you again soon! In the meantime, drop your host and the rest of the team a line: [email protected] and @ceboudreau; [email protected] and @jennyhops; [email protected] and @hbottemiller; [email protected] and @IanKullgren; [email protected] and @mjkorade; and [email protected] and @jsonhuffman. You can also follow @POLITICOPro and @Morning_Ag on Twitter.

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