Rancho Feeding Corporation facing federal criminal probe

The Petaluma slaughterhouse facing a two-pronged federal probe is now the subject of a criminal investigation as well, according to a U.S. congressman – and disturbing new allegations may offer a clue as to what direction the investigation will take.

Rep. Jared Huffman, D-San Rafael, confirmed last week that Rancho Feeding Corporation, which has been in hot water with the U.S. Department of Agriculture since January, is also being investigated by the U.S. Attorney’s Office.

The news helps to clear up one longstanding question, which is why the USDA forced a massive, 8.7-million-pound recall of Rancho meat without releasing any substantive details as to what Rancho did wrong. Those details were kept secret, insiders believe, because of the pending criminal investigation.

Huffman said he was informed last Monday of the involvement of the U.S. Attorney’s Office during a call with Rep. Mike Thompson, D-St. Helena, and U.S. Agriculture Secretary Tom Vilsak.

“The secretary emphasized the gravity of the investigation and the suspected misconduct by the owners of Rancho,” Huffman told the Santa Rosa Press Democrat. “That is the belief of investigators right now, although they can’t give us any specifics.”

Meanwhile, some rather grotesque specifics have come from a different source claiming to have inside knowledge of the probe. According to this person, who spoke on condition of anonymity, Rancho’s owners skirted federal inspection laws by cutting off the heads of cows with eye cancer – presumably to get rid of the evidence of disease – then processing the rest of the animals for human consumption.

The meat of these cows was mingled with healthy meat and sold under the Rancho brand, the source told the Press Democrat.

“Basically, Rancho had figured out a way to sell meat for profit that they would otherwise have had to destroy,” the source said.

It remains unclear why the recall also included meat slaughtered at Rancho that was grown by small local ranchers and processed under their watchful eye. For example, an estimated 100,000 pounds of beef produced by Bill Niman’s BN Ranch of Bolinas has been caught up in the recall – even though his cattle reportedly are slaughtered with a Niman employee always in attendance. The meat, valued at up to $400,000, currently sits in freezers awaiting a decision by the federal government.

As the Point Reyes Light put it, “The recall treats the highest-quality beef from BN Ranch browned into a sirloin roast at Chez Panisse as a health hazard equal to ground beef from spent dairy cows blended for frozen Hot Pockets Philly Steak & Cheese.”

As the only USDA-inspected slaughterhouse in Northern California, Rancho is an important link in the chain of high-quality “farm to table” meat for North Bay ranchers. But the local cattle industry – worth $12.3 million last year in Sonoma County alone – was rocked in January after police and federal agents raided Rancho and recalled 41,683 pounds of beef products.

Then on Feb. 8, the recall expanded dramatically, encompassing “approximately 8,742,700 pounds” of beef products because, the agency stated, Rancho “processed diseased and unsound animals and carried out these activities without the benefit or full benefit of federal inspection.”

The agency labeled it a Class I recall, meaning there was a “reasonable probability that the use of the product will cause serious, adverse health consequences or death.” There have been no reports of illness connected with Rancho products.

There are no indications the criminal probe against Rancho will jeopardize a pending sale of Rancho to David Evans, founder and CEO of Marin Sun Farms based in San Francisco. Evans recently announced that he is buying the plant because high-quality, grass-fed beef producers in the region depend on it.

In a statement, the USDA confirmed the intended purchase and said its Food Safety and Inspection Service “will review the application in accordance with our regulations and policies to ensure the firm meets requirements.”

Sonoma resident Tony Knecht, who is partner in a grass-fed beef operation at Beltane Ranch north of Glen Ellen, said small ranchers represent the healthiest and most ecologically responsible way to produce meat. And he said those ranchers are in a bind without their local slaughterhouse in operation.

“It takes people like us out of the picture,” he said Monday. “We have to wait and see what Mr. Evans comes up with. Everything’s on hold until all this straightens out.”

If the sale to Marin Sun Farms works out, “then everything’s possible,” he added. “It all kind of hinges on that right now.”

As for the USDA, Knecht said, “They have a responsibility to get that plant open as soon as possible,” he said. “That is their public responsibility, and I believe that firmly.”

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Index-Tribune news editor Don Frances contributed to this story.