• Several alternative ways of hog waste management have been studied, but few have been implemented in North Carolina
  • Currently the state caps damages that property owners can collect in nuisance lawsuits against hog farm operations, which limits their accountability and lessens their incentive to find alternative waste management systems
  • North Carolina should allow farmers to innovate with new technologies by lifting the moratorium on hog farms and implementing an “agriculture sandbox”

Note: This is Part Two of a three-part series on hog farming in North Carolina. Part One covered the history of hog farming in the state, and Part Three will discuss the problems with the left’s charge of “environmental racism.”


The management of hog waste in North Carolina has garnered much attention and controversy over the past two decades. In 1999, Hurricane Floyd brought to light the severe environmental and public health concerns associated with the traditional open-pit lagoon system used for hog waste disposal. In response to these issues, in addition to a moratorium placed on new and expanding hog farms, in 2000 the North Carolina Attorney General entered into an agreement with Smithfield Foods and five other companies to explore alternatives. As the 25th anniversary of the agreement approaches, however, it’s evident that the situation remains largely unchanged, and the need for alternative hog waste management approaches persists.

This brief will delve into the ongoing challenges of hog waste management in North Carolina from a free-market perspective, critique the government’s role, and explore alternative solutions while emphasizing individual freedom and property rights.

Alternative ways to manage hog waste

Hog farming in North Carolina primarily relies on the open-pit lagoon system, which is the most cost-effective system but has long been criticized for its environmental and health hazards. Concerns about lagoon overflows during severe weather events, resulting in the contamination of waterways and local communities, have been at the forefront of the debate. The absence of market-driven alternatives has been exacerbated by regulatory and government interventions, limiting the freedom of hog farmers and hampering innovation in this sector. Some of those innovations include:

  • Closed Loop Systems. Closed-loop systems represent a promising alternative to open-pit lagoon systems. These systems eliminate the need for open pits, thus reducing the risk of spills and contamination. Their implementation requires a higher upfront investment, but they hold potential of enhanced environmental safety and public health outcomes. Smithfield Foods, for example, has taken steps to adopt this system and demonstrate that it is both feasible and environmentally beneficial.
  • Wetland Systems. Another potential solution for treating hog waste utilizes wetlands. In this approach, waste is processed through wetland vegetation, which can naturally absorb nutrients and contaminants, reducing the environmental impact of hog waste. The drawback is that wetland systems may require additional land and have a higher implementation cost.
  • Waste-to-Energy Technologies. Technology-based solutions, such as waste-to-energy systems, can convert hog waste into valuable resources, such as biogas and electricity. This approach reduces the environmental footprint of waste and offers a path towards sustainable energy production. While North Carolina offers a significant amount of government programs and mandates for biofuels, the upfront investment for waste-to-energy technologies is substantial.
  • Fertilizing the Forests. Another idea would use excess hog waste from lagoons to fertilize forest areas that need new growth.

Many of these alternatives were considered in response to the Smithfield Agreement. Unfortunately, that agreement failed to outline key performance metrics properly. Under the agreement, issues such as potential risk of water pollution and smell were required to be reduced in an “economically feasible” way, but it did not specify by how much. The effect was to discourage the wide implementation of any alternatives tested. 

Top-down state responses have been insufficient

The state’s responses to the hog waste management issue in North Carolina have been inadequate and, at times, detrimental to the principles of individual liberty, free markets, and property rights. Typical of top-down government responses, they have featured:

  • Regulatory Overreach. Government regulations, rather than addressing the root of the problem, have contributed to the persistence of the open-pit lagoon system. Instead of fostering innovation and incentivizing hog farmers to explore more efficient and eco-friendly alternatives, regulations have stifled entrepreneurial spirit and limited economic freedom.
  • Insufficient Protection of Property Rights. Instead of relying on the tort system and allowing affected individuals to seek redress for actionable harms from hog farm operations against their property or well-being, the state has imposed caps on damages bounded by the assessed fair market value of the affected property. Having these caps in place limits the accountability of the industry and lessens the incentive to find alternative waste management systems.
  • Discouraging and Preventing Market Solutions. The government has largely ignored the potential for market-driven solutions in hog waste management. The state even went so far as to impose a permanent moratorium on new and expanding hog farms, despite the industry’s significance to North Carolina’s economy. The state’s actions have deprived individuals of the freedom to make choices based on their preferences and values and farms of the ability to seek out alternate waste management technologies without fear of regulatory backlash. In a truly free market, consumer and farmer interest in eco-friendly and sustainable hog farming practices could drive the pursuit, innovation, and adoption of alternative technologies.

An agricultural sandbox could lead to market solutions

The government should encourage and allow the market to drive technological innovation in hog waste management. Entrepreneurs and farmers should be free to experiment with alternative waste disposal methods, such as closed-loop systems, waste-to-energy technologies, or other potential solutions. Consumer preferences and innovations, rather than government mandates, should guide industry practices.

This is where the idea of an “agricultural sandbox” could be so beneficial. In 2021 the North Carolina General Assembly created a regulatory sandbox for finance and insurance products and services. With guidance from the North Carolina Innovation Council, the state’s regulatory sandbox temporarily waives certain regulations for emerging technologies, products, and services to see if they can succeed.

Expanding the state’s regulatory sandbox to include agricultural technology, products, and services would allow farmers and agribusinesses who opt into the sandbox the opportunity to try innovative technologies that the standard regulatory approach would preemptively block. Many states have regulatory sandboxes for select industries, and Utah has an open-ended regulatory sandbox.

A competitive market with greater regulatory freedom would encourage hog farmers to adopt more efficient and sustainable waste management practices voluntarily. By allowing a diversity of approaches, the market can reward the most effective and eco-friendly methods, meeting consumer demands and strike a better environmental balance without government interference.

Protecting the safety of people living near hog farms means proper protection of the property rights of individuals affected by hog farm operations. The tort system should enable affected parties to seek compensation when their property or health is harmed. The expectation of such consequences would give hog farms a direct incentive to adopt cleaner and safer waste management practices.


Hog waste management in North Carolina presents an opportunity to reevaluate the government’s role and uphold the principles of individual liberty, property rights, and free-market competition. A property rights–based approach, where affected parties have more freedom to seek redress for harm, would provide a more equitable and efficient solution. Technological innovation and competition within a deregulated market would empower hog farmers to seek and adopt alternative waste management practices. By embracing the time-honored principles of free markets and limited government, North Carolina could find a path forward that respects individual freedom, enhances environmental responsibility, and supports a thriving hog farming industry through voluntary, market-driven alternatives to the current open-pit lagoon system.