101-year-old Sonoma County family dairy closes after costly court fight with environmental group

Mounting pressure on dairies

Sonoma County residents are poised to vote this year, likely in November, on a ballot measure that would ban so-called “factory farms,” including ranches with 700 or more dairy cattle, or 200 or more dairy cattle if the facilities discharge manure directly into surface water. The same goes for poultry and egg farms, which would be restricted at different thresholds.

Ongoing dairy legal battles are compounded when you consider the industry nationwide is facing crippling inflation prices for feed, utilities and gasoline, while still recovering from recent drought years. If around half of income typically goes to pay for feed, now it’s upward of 65% to 70%, which makes it nearly impossible to turn a profit.

“I don’t know if there’s a dairy in the county, whether you’re Sonoma or Marin, that’s not looking at an exit plan,” Mulas told a Sonoma Index-Tribune reporter in October 2022.

A certified letter would arrive the next month, the day after Thanksgiving, giving notice of the intended lawsuit.

In the tally of environmental victories over the past several decades, it’s a case that will hardly merit a mention or even a footnote: A third-generation farm on its last legs gets hit with a routine lawsuit meant to force it to comply with federal water quality standards. The goal was not to put Mulas out of business, said Petaluma attorney Andrew Packard, who along with his associate William Carlon, filed the suit against Mulas on behalf the California Sportfishing Protection Alliance.

California Sport Fishing Alliance Suit.pdf

Working on contingency, Packard has filed more than 100 stormwater discharge cases for a handful of clients across the state. He handles about eight to 10 cases a year. Around the same time he sued Mulas, Packard also filed suit against Reichardt Duck Farm in Petaluma, later reaching a settlement that includes continued monitoring.

One of Packard’s top clients is the California Sportfishing Protection Alliance, an environmental nonprofit based in Groveland that’s involved in lawsuits all over the state, including the planned Sites Reservoir in Colusa County, the proposed Delta tunnel and a previous wastewater case at Mule Creek State Prison in Amador County.

Funded mostly by grants from foundations, the sportfishing alliance has filed four to six water quality lawsuits per year for the past three years.

The strategy is simple: “They tell me to ‘stick and move, stick and move,’” Packard said, using a boxing analogy to explain the group’s playbook. The way it typically works, he said, is CSPA director Chris Shutes will direct Packard toward the next target.

“We’ll have a meeting, and they’ll say, for example, ‘We want you to look at this industry — maybe it’s auto recycling in the Redding area. There’s a lot of it and no enforcement’s going on,” Packard said. “So, we might go and look at all the files of the 18 auto dismantlers in the greater Redding area, and say, ‘Well, these six are the worst.’ And they might greenlight an investigation, and possibly a lawsuit after that.”

The goal is to get the rest of the industry to follow suit by using the settlement as a deterrent.

“We want the worst guy out there, so when the public settlement is circulated, it’s like, ‘Oh wow we better get our act together.’ We try to encourage what’s called quiet compliance.”

Data fuels lawsuit

In this case, the target was dairy farms in the Sonoma area, particularly near the San Pablo Bay watershed. Packard and Carlon, who has since left Packard’s firm to start his own practice in Napa, started by combing a public database.

SMARTS, which stands for Stormwater Multiple Application and Report Tracking System, is available online to anyone interested in analyzing water quality test results. Every farm that holds permits requiring it to self-monitor and take samples from the local watershed has to submit annual test results, which are uploaded to the SMARTS database.

Packard said he doesn’t remember exactly what initially flagged Mulas Dairy in early database searches. It might have been tests taken at two points in nearby Schell Creek that showed excessive total suspended solids — tiny waterborne particles, such as soil or algae or decaying organic matter, larger than 2 microns — at concentrations of 252 and 256 milligrams per liter, well over the federal benchmark value of 100 milligrams per liter. In January 2019, they were 122 and 199 milligrams per liter, according to the SMARTS database.

Or it might have been an October 2021 notice of violation from the San Francisco Regional Water Quality Control Board for failing to submit annual Exceedance Response Action reports for the previous year as required by the industrial stormwater general permit.

In any case, Packard sent out an investigator to take photos with a camera and a drone.

“It was kind of primitive. They had a tributary of the slough running right through where the cows were standing around,” said Packard, talking about the drainage ditch. “You could see it from the road.”

They filed suit soon after in January 2023, alleging the “defendants discharge pollutant-contaminated stormwater from the facility into an unnamed creek, which drains to Schell Creek, then to Steamboat Slough which is a tributary of the Second Napa Slough, which discharges to Sonoma Creek and ultimately to San Pablo Bay and the Pacific Ocean.”

The lawsuit also noted that Mulas Dairy qualifies as a CAFO or “concentrated agricultural feeding operation” — an official term for a facility that stables or confines animals for 45 days or more in any 12-month period. Mulas Dairy had about 800 mature dairy cows and 400 calves at the time, according to the suit.

Under the Clean Water Act, a third party (in this case the sportfishing alliance) can sue if they can show that state or federal agencies are not enforcing violations of water quality standards.

In early January 2023, just before the suit was filed, Mike Mulas and his attorneys invited Packard and Carlon out to the farm to look around. “We had nothing to hide,” Mulas said. “At some point, they took the case from over there (pointing to Schell Creek to the west) to over here (pointing to the drainage ditch on the east side of the dairy).”

Two months later, in March 2023, a San Francisco Bay Regional Water Quality Control Board inspector came out to the property after receiving a complaint that dairy cows had been seen in the drainage ditch. It turned out that cows had broken a fence and entered the ditch. Mulas removed the cows from the ditch and fixed the fence.

But in a detailed inspection report covering the entire property, the inspector also found that the dairy was holding permits it didn’t need. In addition to the general waste discharge requirements for confined animal facilities permit, Mulas had also obtained a permit for industrial stormwater discharge back in the 1980s when he was unsure of water board regulations and classifications. Now it was deemed unnecessary.

“Our finding was that there was no discharge under the industrial stormwater permit, therefore we allowed them to terminate the coverage under that permit,” said Xavier Fernandez, planning division manager at San Francisco Bay Regional Water Quality Control Board.

Stormwater permit coverage is required only for facilities that meet the definition of a CAFO and also discharge pollutants into waters of the U.S., he said. Since there was no evidence of discharging, and “the facility’s production area is designed, constructed, operated, and maintained so as not to discharge,” then there was no need for a permit.

As evidence, Fernandez pointed to five waste and stormwater retention ponds, a levee that prevents overspill into Schell Creek, grading of freestall barns to drain toward the ponds, fencing to keep animals out of surface water, feed locations located away from waters and diversion ditches that were clean and not creating erosion.

As part of the Clean Water Act, a letter notifying of the lawsuit is sent to the water quality board and “if we take up enforcement, then the third-party lawsuit goes away,” Fernandez said.

But, in an almost Kafkaesque twist, since the board maintained there was nothing to enforce, “we did not take up enforcement,” said Fernandez, and the lawsuit continued.

Suit was ‘tipping point’

As Packard and Carlon pushed forward, they demanded Mulas come up with a new stormwater pollution prevention plan and an improved monitoring system. They also asked the court to require Mulas to pay civil penalties of $59,973 per day per violation for all violations occurring after Nov. 2, 2015.

“The issue from a Clean Water Act standpoint is that this little tributary that these cows are standing around and (defecating) in, runs through a pipe and then into a swale, and down into a field that wasn’t always flooded, but sometimes was flooded, and then through a break in the levee that was controllable with a gate,” Packard said. “They tried to fudge the facts about whether that was happening, and thank God there are drones, because they do tell a different story.”

By June 2023, the parties were already in settlement talks. On Oct. 19, 2023, the last of more than a thousand cows and calves were shipped off to Turlock.

Mulas makes it clear that many factors contributed to the closure of the dairy — and the lawsuit was simply “the tipping point.” It’s ironic though, he said, that back in 2017, the Golden Gate Salmon Association gave Mulas Dairy an award for its watershed stewardship and use of recycled water in the fields. Now, a different group was pushing him to the brink of insolvency.

Over the course of more than 100 stormwater discharge lawsuits, Packard said, he’s seen many defendants threaten to go out of business, but this is the first one that’s actually closed shop as part of the settlement.

“Our goal has never been to put anybody out of business,” said CSPA director Chris Shutes. “Our goal isn’t to make life difficult for people doing business. Our goal is to stop pollution.”

Sonoma County Farm Bureau Executive Director Dayna Ghirardelli strongly disagrees. “This almost felt like a witch hunt,” she said.

Back in the 2000s, Ghirardelli worked as a consultant with Mulas Dairy to help them with water quality permitting. This time around, she helped connect Mulas with dairy industry advisers and water quality permitting experts, but she couldn’t help them find a way to survive.

Family’s long legacy

Walking around his vacant property on a quiet spring morning, Mulas stopped to point out surrounding hills and flatlands where more than a dozen dairies flourished decades ago.

Somehow, Mulas Dairy outlasted nearly all of them. Mertens might be the only old-time, multigenerational dairy left near Sonoma.

“Maybe it was our Italian stubbornness,” he joked.

Looking for work and a new start, his grandfather, Mike Mulas Sr. arrived in San Francisco from the Italian island of Sardinia in 1914. Working piecemeal jobs in the shipyards for a year, he finally landed a steady job milking cows in Petaluma. By 1922, he had worked his way up to leasing a farm and a handful of cows at the south end of Sonoma Mountain.

The dairy relocated twice — once along Stage Gulch Road, now Highway 116, near Petaluma where sheriff’s deputies were called to his ranch in 1936 when he refused to allow state officials to test his cows for tuberculosis. He relented, and later settled on the present Carneros Highway ranch with 17 cows in 1937.

By 1953, Mulas had 140 cows on 380 acres. His two sons, Mitch and Mario, helped milk twice a day, starting at 4 a.m. Back then, they had five milking machines, costing $125 each. The milk barn cost around $17,000. And cows that produced around 40 pounds of butterfat a month, cost $250 each.

Mike Mulas remembers the rough-and-tumble days while learning to work the farm at an early age. Like the time, at 7, when his dad was busy wrestling a calf in the back of a truck, and told him to “drive toward that gate.”

So he did, and he ran right over the gate. “He didn’t say to stop,” the younger Mulas quipped.

His father, Mitch Mulas, was a born leader, whether it was running the dairy or serving as president of the county farm bureau, chief of the Schell-Vista fire station or as a member of the local school board or conservation district.

By the time he passed the farm down to his children, Mitch Mulas was a veteran of many land-use battles. In 1986, he fought a ballot initiative to prevent farms from being turned into residential subdivisions. Four years later, he helped lead the successful campaign to create the county’s taxpayer-funded Agricultural Preservation and Open Space District.

His philosophy was “If you’re going to live in a community, you better be involved in it,” Mike Mulas said.

His children followed suit. Ray Mulas is the longtime fire chief at Schell-Vista Fire Protection District, where Mike also volunteers. Their sister Vickie has been on Sonoma Resource Conservation District and Sonoma Valley Groundwater Sustainability Agency boards. Mike was also an assistant football coach at Sonoma Valley High School for 35 years.

This past Christmas, the extended families gathered as they always do in “the family meeting hall,” a converted garage beside their parent’s old house across the highway from the dairy. Volunteer firefighters used to call it “Station 3” because it’s where extra Schellville Fire engines would occasionally be parked. It includes a kitchen with a walk-in freezer where Mike Sr. would store his special spaghetti sauce in large milk churns.

As a Christmas present, Mike Mulas’ wife, Denise, had a dusty box of vintage 8 mm family film reels converted to digital files. Everyone gathered around and watched them on the family television, not far from a wood-burning stove and walls filled with ranching photos and newspaper clippings underneath the words: “Together We Make a Family.”

Nostalgic and bittersweet, one video showed a new barn being built. “Another was when they invited the Italian Consul up from San Francisco,” Mulas said. “All these cars with flags are driving by. It was a big deal back then.”

He tries not to think of what his grandfather would say about the farm closing, but he knows his father would have done the same thing. “You fight battles for a while, but at some point you have to know when to cut your losses and move on. I know he would have done the same thing.”

Looking ahead

For now, Mulas plans to keep the dozen or so large barns standing on the property, while selling off old equipment to much larger dairies in the Central Valley. The irony he says, is that Sonoma County residents may one day buy all their milk from massive Central Valley dairies — the industrial CAFOs that environmental groups are cracking down on.

Meanwhile, Packard’s goal of “quiet compliance” seems to be working. Ripple effects from the settlement are still reverberating through the local farming community.

“One dairy farmer recently asked, ‘How do I protect myself if these guys are out there just grabbing information and they don’t really care what we do and they’re just trying to put us out of business?’” Ghirardelli said. “There’s a lot of fear out there.”

At age 63, Mulas shares that some days he is bitter in the wake of the dairy’s closure. Other days he tries to look on the bright side. “Maybe the lawsuit was a blessing in disguise for us. After I see where the industry is going now, maybe it was.”

He’s almost relieved not to be looking over his shoulder anymore. “I’ve heard rumors that there are drones flying over people’s properties, and then they’re getting hit with people asking questions,” he says. “You used to get up in the morning and you loved to do what you do, and you went to work. Now these guys get out of bed in the morning and look over their right shoulder, their left shoulder, and look up in the air. There are people all over the place checking on them.”

Packard, for his part, is ever vigilant: “Every time I drive by, I’m always checking to see if maybe they aren’t buying another herd,” he said.

The question now is, what to farm next on the land? Still paying property taxes, Mulas has been mulling it over for months and still hasn’t come up with a viable plan. It’s a common dilemma for farmers around the country. The acreage is zoned for agriculture, so it will likely never be developed for housing. He currently farms 72 acres of chardonnay and pinot noir grapes, but with a glut last harvest, “grapes are a dying breed right now,” he said. “We’ve got grapes and can’t get contracts.”

Other farmers advised him to put silage and hay crops in. “But we’re losing animals, so you don’t need that many of those crops anymore. There’s plenty of feed around for the animals we have. So that’s kind of a moot point.”

Looking back, it’s a good thing he never encouraged his kids to go into the business, he said. His son is a vineyard manager in Napa, and his daughter is a nurse at Marin General.

“I pretty much steered them away. I could see the writing on the wall when they were growing up.”

Whatever crop he finally decides to plant, in the back of his mind he’ll be wondering who might be monitoring his every move and which watchdog group he might have to face off with down the road.

“It doesn’t pay to own ground anymore, not in Sonoma County,” he said. “There is no more right to farm — you don’t have the right to farm anymore.”

You can reach John Beck at john@beckmediaproductions.com.