Mom and pop business fined $90K for selling too many cute bunnies
Wednesday, May 25th, 2011If you’ve ever thought about turning a hobby into a small businesses, you may be interested in what happened to this Missouri couple:
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John Dollarhite and his wife Judy of tiny Nixa, Mo., have been told by the USDA that, by Monday, they must pay a fine exceeding $90,000. If they don’t pay that fine, they could face additional fines of almost $4 million. Why? Because they sold more than $500 worth of bunnies — $4,600 worth to be exact — in a single calendar year.
About six years ago, the Dollarhites wanted to teach their young teenage son responsibility and the value of the dollar. So they rescued a pair of rabbits — one male and one female — and those rabbits did what rabbits do; they reproduced. Before long, things were literally hopping on the three-acre homestead 30 miles south of Springfield, and Dollarvalue Rabbitry was launched as more of a hobby than a business.
“We’d sell ‘em for 10 or 15 dollars a piece,” John said during a phone interview Tuesday afternoon, comparing the venture to a kid running a lemonade stand. In addition, they set up a web site and posted a “Rabbits for Sale” sign in their front yard. Most customers, however, came via word of mouth.
In the early stages, some of the bunnies were raised and sold for their meat. Much further down the road, John said, they determined it more profitable to sell live bunnies at four weeks old than to feed bunnies for 12 weeks and then sell them as meat.
“We started becoming the go-to people” for rabbits in the Springfield area, John said. “If you wanted a rabbit, you’d go to Dollarvalue Rabbitry.” He added that the family even made the local television news just before Easter in 2008 for a report about the care and feeding of “Easter bunnies.”
Initially, the Dollarhites sold the large, white, pink-eyed variety of rabbits. Eventually, however, they switched to selling a couple of different varieties of miniature rabbits, the mating pairs of which were purchased from breeders across the state. Not only did their “show-quality” miniatures reproduce well, but they ate less and seemed to be more popular with theme park visitors and retail buyers.
During the summer of 2009, the Dollarhites bought the rabbitry from their son who had grown tired of managing it. They paid him what he asked for it, $200. Things kept growing, however, and the Dollarhite’s landed a pair of big accounts in 2009.
A well-known Branson theme park, Silver Dollar City, asked the Dollarhites to have them provide four-week-old bunnies per week to their petting zoo May through September. When the bunnies turned six weeks old, they were sold to park visitors. The Springfield location of a national pet store chain, Petland, purchased rabbits from the Dollarhites as well.
In the fall of 2009, the theme park deliveries ended for the year and the Dollarhites scaled back their operation. At about the same time, the folks at Petland asked the Dollarhites to raise guinea pigs that the store would purchase from them. No big deal.
By the year’s end, the Dollarhites had moved approximately 440 rabbits and grossed about $4,600 for a profit of approximately $200 — enough, John said, to provide the family “pocket money” to do things such as eat out at Red Lobster once in a while. That was better than the loss they experienced in 2008.
Then some unexpected matters began demanding their attention.
It’s an understatement to describe the Dollarhites as being “beyond surprised” when, in the fall of 2009, a female inspector from the U.S. Department of Agriculture showed up at the front door of the family home, wanting to do a “spot inspection” of their rabbitry. She said she had come across Dollarhite Rabbitry invoices while inspecting the petting zoo at Silver Dollar City.
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What do you folks think? Is this yet another example of a Federal government that has grown far too large and powerful or are the Feds right to demand ninety grand for failing to file a piece of paper?
May 25th, 2011
I don’t think I’m alone when I say:
HO – LY CRAP!!
Of all the stuff I’ve seen happening in this country lately to clamp down on freedom, this is one of the most egregious. Maybe it’s got me spooked because I’ve lately been considering raising rabbits, but this is incredible. This couple was being completely cooperative with all stages of their “investigation”, and yet the USDA decides to prosecute them fully to “make an example of them”? No warning at all? And why is that law even on the books?
May 25th, 2011
When are people going to learn that if someone from the Govt is on your doorstep requesting entrance, talking about inspections etc, the answer has to always be NO!
I believe the Dollarhites violated provisions that are designed to keep small time producers from ever coming close to competing with the major poultry producers.
May 25th, 2011
Oh my gosh, this is scary stuff. I have a small “farm” and plan on selling mini-rex rabbits, produce, and lambs (no where near $500 worth a year though) and it makes me nervous to think the government can do stuff like this. It’s ridiculous…
May 25th, 2011
Un-stinkin-believable! And we wonder why our economy is a wreck and why, in this time of “hope and change” we have so little hope. We could use a change in 2012, to be sure. A shotgun should have met the investigator at the door and marched her arrogant little (or probably big) behind off the property.
May 25th, 2011
There are so many laws on the books these days that it would be more than just a little difficult to be in compliance of them all, especially in a small operation like this rabbitry. The government, aka Big Brother, has all kinds of time, money, and personnel to chase after these “criminals” of farming, but is in debt up to its eyeballs and the debt is climbing. This is completely wrong and immoral, to make this small time farmer an “example”. Go after the real criminals in farming — those who actually keep animals in intolerable conditions, those who slaughter sick animals for the public to later consume, those who pump animals full of drugs and hormones to grow them faster and kill them sooner. The government should stop trying to protect us from small farmers and homestead operations and focus on bigger operations.
May 25th, 2011
Just another example of Big Government trampling the entrepreneurial spirit.
May 25th, 2011
Anytime a gov’t type person says they’re going to inspect us, it gives me the willies. We sell at certified farmer’s markets and although I *know* all my certs are in order and we’ve never been cited after an inspection, it’s this type of abuse of power that makes me nervous. There’s very little recourse when the government comes after you. We’ve been audited in the past by the IRS and hired a CPA to help us figure it all out. Even though we were able to show that we didn’t owe the money, it would have cost more to fight it than it would just to give them what they were asking for. It’s nothing short of extortion.
May 25th, 2011
I just finished reading 9 C.F.R. § 2.1 (a) (1). If I’m reading this correctly, the Dollarhites ran afoul of the law when they switched from raising the rabbits as meat producers to pets…am I right? It looks like there’s an exemption for rabbits produced for fiber or meat. But who knows- it’s so complicated I can barely make sense of it. If anyone else reads the law and can make sense of it, please let us know.
May 25th, 2011
A $90,000 fine for not getting a license that they didn’t even know they needed. Wow, talk about punitive (nearly 20 times what they grossed from the sale of the rabbits) and a great example of over-reaching government.
Since I’m a bit aghast/outraged over this, I wrote an email to the currently Secretary of Agriculture, Tom Vilsack (AgSec@usda.gov). Since speaking up and spreading awareness is about all that I can do…
May 26th, 2011
I saw this the other day. I am dismayed, since we’ve discussed raising rabbits in my family.
It’s utterly reprehensible. As other pointed out above, it’s definitely a sign of too much government.
It’s just one more example of how the centralization of any power leads to abuses of citizen’s freedoms. This is true for Governments, corporations, unions, etc.
May 26th, 2011
Those are exactly the kind of people I would not want for neighbors! They defy the laws that are set in place to protect us. Who knows what other laws they are breaking, and to think they taught their kids to do the same! Oh, the shame of it all! (Note the major sarcasm in my voice!)
Government is too big. And we wonder why our economy is in the tank. It’s because we’re spending our tax dollars chasing after people like the Dollarhites for selling more than $500 worth of rabbits in a year, and many of our congressmen and women get merely a slap on the wrist for not paying the taxes they owe. (And it’s probably a sure bet that they own more than the Dollarhites!)
Justice, justice, where art thou?!?
May 27th, 2011
Obama 2012, “Change you can step in, Hope it comes off!”
June 3rd, 2011
We are about to buy a property in TN with the hopes of becoming a small self sufficient farm as cost of living is rising every year. We are fortunate that farming won’t be our sole source of income as I think that it is harder and harder for a small time farmer to succeed.If you can’t afford to have a team of lawyers manipulating paperwork you are bound to run into trouble regarding all of the government regulations. Like many others I feel that the system is stacked against the little guy. I could understand asking for taxes owed on the sale of the rabbits and even a small fine for interest owed but $90,000 on a $4,600 mistake is just crazy. I guess their mistake was supplying for a big business to begin with. It also drives home the point of educating yourself on all of the laws local and federal before selling anything. That said I sympathize with Thoreaux more and more each day and wonder how close we are coming to an Orwellian future. All I can say is hooray for craigs list one of the last bastions for small farmers.