Researchers from California Polytechnic State University – San Luis Obispo have released in March a new study on agriculture regulations for wine grape production. The research is similar in scope to other studies the researchers conducted in California that show regulatory costs have increased over 1,300% on some agricultural operations over the last 20 years. “Our members have said continually that regulation is driving them out of business,” said Peter Rumble, CEO of the Napa County Farm Bureau, “so we expected the findings would not be good. But this is shocking. It shows how much work we need to do at the federal, state, and local level to support agriculture. Without change, we might not have viable agriculture as we know it now in Napa.”

The Napa County winegrape grower regulatory cost findings representation an important addition to earlier research CalPoly SLO research that found in January 2025 that Monterey County lettuce producers’ regulatory compliance costs have risen 63.7% since 2017, and a whopping 1366% since 2006.  And while regulatory costs now constitute $1600 per acre or 12.6% of production costs for the Monterey County lettuce producer whose production costs the professors have been following for nearly 20 years, farmgate value for their lettuce increased a paltry 0.37% from 2017 to 2024.   

The report notes the cost of regulatory compliance for Napa County wine grape growers is significant, with wine grapes appearing to be among those with higher regulatory costs relative to production costs in the state – and twice as high as similar crops in Oregon. The report also notes that given the recent downturn in wine consumption and current oversupply of wine, profit margins are already shrinking beyond the point of maintaining viability in wine grape farming.

‍ ‍“Our (Napa County) study showed that regulatory costs comprise between 8 to 12 percent of production costs – which makes a big difference in profitability,” notes Lynn Hamilton, agribusiness professor at Cal Poly, who completed the study along with fellow Cal Poly agribusiness professor Michael McCullough. “Both growers and policy makers need to understand the impact of regulatory costs on the viability of farming, because these costs are usually missing from production planning budgets.”

In their earlier work, “Two Decades of Change: Evolving Costs of Regulatory Compliance in the Produce Industry,” Hamilton and McCollough found increased compliance costs since 2017 from Sustainable Groundwater Management Act (SGMA), Irrigated Lands Program, equipment emissions regulations, and minimum wage and other workplace mandates increasing employment costs.  Costs of regulatory compliance for food safety, inspection audits, air quality, crop protection reporting, employee health and safety and wages were included in the study.  Leading drivers of regulatory cost increases were employee health insurance and water quality compliance. 

California agricultural producers are justifiably proud to grow a third of the nation’s produce with the highest wages, labor standards, workplace safety and health and environmental protections in the world.  But increasing compliance costs continue to squeeze California producers, constraining their ability to compete with lower-cost producers around the world. 

You can find more information about the Napa County winegrape growers’ regulatory cost report here.