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U.S. dairy farmers will soon be faced with Environmental Protection Agency waste control regulations. This study estimated the investment and annual costs they will incur for lot runoff control and solid waste storage systems. Findings indicate that total investment for facilities and equipment to control lot runoff for typical dairy farms, assuming all U.S. dairy producers have lot discharge problems, would be $780 million. An estimated 40 percent of the dairy producers actually have problems. This would represent an aggregate investment of $312 million. EPA regulations will fall heaviest on dairy farms with fewer than 20 cows, where investment could be almost $200 per cow and the cost of producing 100 pounds of milk could increase by 45 cents. Exempting these small producers from compliance would reduce total investment to $528 million, assuming all producers have lot discharge problems. It is expected that runoff control regulations will hasten the exit of small dairy producers and stimulate the current shift to fewer and larger farms.


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