“The bottom line is that we have to earn a profit to stay in business!” Family business owners fully understand the gravity of this truth. But what is profit? At its roots, profit is simply the state or condition of yielding a financial gain in an enterprising activity after all of the expenses are paid.

In a family business, profit is much more. It is the fuel for growth and the necessary ingredient for liquidity. It is also intensely personal, as profit may be the source of a year-end bonus for an executive, new equipment for staff or payment for a daughter’s education when distributed to a shareholder. In fact, profit is so personal that our very relationship to money impacts how we view profit.

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For those who deeply value the prestige and power gained from wealth, there may be an intense drive to maximize profit so that large distributions can be made to support growing lifestyle demands and interests. For those who value work-life balance, there may be a desire to provide flexible schedules and support resources to company employees, even if it means less profit at the end of the year. Even the work culture can impact how various stakeholders view profit. For example, when open book management is successfully implemented, every employee from top to bottom asks prior to a spending decision: “How much will this increase or reduce profitability?”

In a family business, profit is not a black-and-white concept. It is seen as a dynamic mix of business performance, stakeholder personality and family business culture.

How do different stakeholders view profitability? In order to understand the dynamics, we need to look at how different family business stakeholders commonly view profitability.

OWNERS. Owners often see profit as the fuel to reach their ownership vision and mission, which varies from owner to owner. Owners see profit as key to ownership continuity. They wish to receive long-term returns on investment and access to liquidity when ready to harvest their ownership returns. They also may seek shorter-term liquidity in the form of dividends or distributions. Lack of profit may be personally threatening when bank loans and guarantees are present.

MANAGERS. Employees often see profit as the key to accessing new work tools (better computer, new equipment, improved lighting or additional staff) and also improved lifestyle and wealth building (salary raises, bonuses, new benefits or time off). Too often their view is disconnected from the concept of the owner’s need for return on investment, especially if not given enough information.

BOARD OF DIRECTORS. Directors often see profit as a key measure of the CEO’s success in executing the strategic plan. They are concerned about being within limits of bank covenants. Directors need to understand the owner’s views on profitability in order to represent them in the board room. Independent directors understand management’s desires to benefit from greater profitability, as they have served as executives. The board needs to become more involved in corporate decision making if management does not generate profit in line with expectations.

FAMILY MEMBERS. Family members want predictability from the business: to know what can be expected in terms of profit use for dividends or distributions. They may perceive lack of sharing profits as being controlling and related to their family status. Parents who control ownership may fear too much profit being used as dividends to younger adult stockholders. Family members may judge other family members by how distributions from profit are used.

In pass-through entities such as S-Corps and LLCs, shareholders are often perplexed as to how taxes work related to profit. With lack of accurate knowledge, they may feel threatened (How can I pay for this giant tax bill?) or even manipulated (What are they not telling me?). Family members may struggle with having income from outside the family business taxed at a higher rate due to the family business income being high, and question the value of family business ownership if distributions are minimal.

SUPPLIERS. Suppliers want assurances that the company is making a profit to be able to pay for supplies. Suppliers may impose more difficult terms if they perceive profitability challenges. Additionally, supplier credibility can lead to opportunities such as expanded product line availability.

CUSTOMERS. Customers want a quality product or service at a low price. They may feel taken advantage of if they perceive the company has made too much money off of them. When the customer is a larger company, the customer may require open sharing of financial information and place limits on the level of profit that the family business is allowed to make. The customer also may want assurances of long-term viability to supply the product or service in a sustainable manner.

BANKS. Banks are willing to loan money when they know they will get paid back. They set a profit threshold that must be met in the form of bank covenants. Banks may require an external work out team if profitability requirements are not being met.

HOW TO MEASURE? A critical part of achieving stakeholder understanding and alignment on profitability goals is to measure it in such a way that fosters stakeholder comprehension and acceptance. The foundational measurement of profitability is fairly straightforward: revenue minus expense equals profit. However, measuring profit in a family business has a few nuances that must be addressed in order for it to be considered by stakeholders as a reliable measuring stick useful to ownership and management decision making.

The nuances of profitability measurement relate to three fundamental expenses:

• Family employee compensation and benefits;
• Related party transactions with other family-owned entities and with family members; and
• Philanthropic expenditures that may be made by the business.

When there is a lack of alignment on which expenses to measure, it may negatively impact the alignment on the measurement of profit. To navigate these nuances, it is helpful to have policies that manage expectations of profitability within the family — but only if these policies are applied consistently. Such policies may include a family member compensation policy for salary, variable pay, benefits and perks; a related party transaction policy; and a philanthropic expenditure policy.

However, profit measurement alone does not provide sufficient meaning for decision making within a family firm. Putting profit into context gives it greater meaning and makes it a useful tool for stakeholder dialogue and decision making. Comparing the amount of profit to another reference point gives it meaning, such as this year’s profit compared to last year’s; actual profit as compared to budgeted profit; profit as compared to owner equity (return on equity); profit as compared to revenue (profit margin); or profit as compared to assets (return on assets). Each family business should establish the best way to put their profit measurement into context and rely on well-accepted comparisons.

To add depth to this dialogue, compare your family business’s profit to equivalent businesses in your industry over time. Determine if you are performing on, above or below par with your peers and see how you measure up. This takes into consideration industry-wide economics and the impact of economic tailwinds and headwinds on your family business’s financial performance. Another useful assessment is to compare a firm’s profit in relation to liquid investment portfolio profits.

WHY IS MEASURING IMPORTANT? There are several reasons why measuring profitability is important. First, the understanding that arises from these types of comparisons builds context for stakeholders. This context can provide an objective foundation for the ownership group to support the management team in the face of difficult economic conditions. It also can challenge the board of directors and management team if the business is performing below par.

Second, without this objective analysis and its use in the dialogue around the business’s performance, family stakeholders are left to make assumptions that often turn out to negatively impact their viewpoint. This can lead to unnecessarily subjective conclusions and make already difficult conversations even more challenging. Finally, objective analysis and open dialogue help family stakeholders better understand which levers can be used to increase and decrease profits as well as provides a platform for good decision making.

GOOD DECISIONS. How do families create good decision-making processes related to profitability? Given the wide-ranging perspectives that operate in a family enterprise, it is not surprising that profitability can create tension and conflict within business-owning families. So who in the family enterprise system gets to decide on the profitability goals for the business? And how do we create good decisions and alignment regarding profitability within business owning families?

We suggest that the decisions related to profitability primarily rest with the company’s shareholders because they own the business as well as assume and manage all related risks. This ownership entitles them to make decisions in the domain of profitability, exercised through the board of directors. However, setting profitability goals should not be done in a vacuum. Management’s voice is critical to understanding what the business is capable of doing, and gaining alignment between ownership and management on goals to pursue is critically important to its success. It also may be wise to seek family input and alignment on profitability goals when an open communication forum has been established.

Making profitability a normal part of discussions among family members is an important aspect of creating healthy decision making around this matter. Above is a worksheet that can serve as an example of a big picture discussion that family stakeholders might engage in around profitability decision making.

Some important steps to help foster a frank and open discussion around profitability within the family business include:

• Utilize a family values exercise to illuminate each person’s relationship to money and to move the topic of money/profitability from being an undiscussable in your family to being one that can be more comfortably talked about. It provides opportunity for individuals to share their expectations and desires around money and profitability without judgment.
• Develop a family vision and values statement with the family to help the owners (should they be a subset of the family) set an overall direction and profitability goals for the company. The company’s management would then build a strategy designed to achieve the owner’s goals and the family’s vision and values.
• Implement a learning plan that builds the knowledge and skill of all family members to understand the financial elements that are material to being a responsible owner of a family enterprise, including philanthropy.
• Provide regular forums (e.g., quarterly meetings) to review the financial picture of the business and other matters related to money. These discussions offer an opportunity to enhance transparency around money and profitability, reduce the power of any related undercurrents, and build understanding and synergy amongst family regarding profitability. Being transparent and sharing information about the current financial status of the business fosters knowledge about how well (or not) things are going, and therefore a greater ability to contribute to profitability discussions.
• Create key policies that relate to profitability and money for your family enterprise, such as: ? Employment compensation (for those working in the business full- or part-time including salary, variable pay, benefits and perks).
• Project compensation (for special projects completed by owners or family).
• Non-family employee compensation (sharing the pot with other key stakeholders).
• Dividends/distributions to owners.
• Related party transactions (including vendors and suppliers and actual or guaranteed loans).
• Charitable giving (expectations of giving back to community, region or globe) and related expenditures.

CONCLUSION. Mixing family and money in business can be confidently accomplished when families take the time to educate themselves on the concepts and key issues surrounding profitability, build forums to gain alignment on their goals, and set policies to clarify expectations on profitability related matters. While this requires investment by business owners to accomplish and may include challenging discussions among the owning family, the clarity and alignment offered can result in a great return on the investment.

All of the authors are with The Family Business Consulting Group, a management consulting firm serving the unique needs of multi-generational family businesses worldwide. Christopher Eckrich, Ph.D. is a senior adviser, Michael Fassler is a principal consultant and Wendy Sage-Hayward is a senior consultant. Learn more at www.thefbcg.com.

Marijuana is now legal to use recreationally in 11 states and the District of Columbia. More states and municipalities are likely to follow suit, even though it remains an illegal substance under federal law.

No surprise, 82 percent of companies are somewhat or very concerned about the impact of marijuana legalization on the workplace, according to a 2018 survey of 742 human resources and management em- ployees by HoundLabs, a company in Oakland, Calif., that is developing marijuana detection technology.

The biggest concern for 65 percent of respondents was how legalization might affect workplace safety, found the survey. That was followed by lost productivity (59 percent), higher workers’ comp incidents and costs (57 percent), absenteeism (51 percent), and employee retention (50 percent).

It’s a complex and confusing time for employers. In fact, more than half (54 percent) said laws legalizing marijuana at the state or local level created compliance challenges for their organizations, found a 2019 survey of 1,331 in-house lawyers, human resources professionals and C-suite executives by Littler Mendelson, a San Francisco-based law firm that specializes in labor and employment issues.

Curtis Rand, vice president of operations at Rose Pest Solutions in Northfield, Ill., couldn’t agree more. Cannabis will become legal for recreational use in Illinois on Jan. 1, 2020, and by then he has much to figure out. This includes how legal marijuana use might impact pre-employment drug testing, insurance, employees in other states, the company’s drug-free workplace policy and QualityPro certifications.

As such, he was researching and consulting with lawyers, insurance companies and drug testing providers to determine the right approaches. “The worst thing we could possibly do is make an uninformed decision” that could negatively affect employees, customers and the community, said Rand. “That’s the quandary we’re in right now,” he said.

But PMPs operating in states where recreational cannabis is legal already said the impact has been nil.

“I was concerned in the beginning but it really has not affected us one bit,” said Brian Olson, president of The Bugman Termite & Pest Control in Anaheim, Calif. California legalized recreational use of marijuana in 2018.

In Massachusetts, Pest-End Exterminators had taken a relaxed approach to using cannabis long before it became legal in 2016. “If it doesn’t affect your job, then I don’t care what you do at home in your own space,” said Operations Manager Adam Carace.

Public support for legalizing marijuana is at an all-time high (forgive the pun) with 66 percent of Americans backing the measure, according to a 2018 Gallup survey. This marked the third consecutive year that support for legalization increased.

Most pest management companies are deferring to state law and treating marijuana like alcohol, said Sandy Seay, an Orlando-based HR consultant to the National Pest Management Association. “Use it on the weekends but when you come to work on Monday morning you’ve got to be able to perform,” he explained.

Carace has never fired anyone because they show up to work stoned. “Honestly, we’ve had more issues with drinking than we have with marijuana,” he said.

Tracking service quality and key performance indicators alert employers to problems, said Olson. “You’ll know if people are abusing any outside substance: prescriptions, pot, alcohol. It will show up in attendance; it will show up in quality of work; it will show up in customer complaints,” he said.

UPDATE YOUR POLICY. Still, firms need an alcohol and drug policy that clearly defines prohibited behavior and potential discipline for impairment on the job.

“It’s very simple. If you’re a drug-free environment there’s no pot. You just have to draw the line,” said Olson.

Abell Pest Control, which has 550 employees across North America, also practices zero-tolerance for workplace impairment. “If you want to go have a beer at lunch, you can’t. It’s the same thing with marijuana. If you want to have a joint when you’re off on your break, you can’t,” said Sara Cromwell, human resources manager for the Etobicoke, Ontario-based company. Canada legalized recreational use of cannabis country-wide last October.

As for medical marijuana, which is legal in 33 states and Canada, laws may require companies to accommodate its use on the job or allow them to prohibit use of cannabis (and other prescription medications that may cause impairment) during and just before work hours.

At Abell Pest Control, if employees take prescription drugs (including marijuana) that may impair their ability to drive, “they can’t be working on that day. We need to work with them to not allow them to work in the truck,” said Cromwell.

Some of Carace’s employees have prescriptions for marijuana to treat pain and anxiety; they didn’t want to take opioids and potentially get addicted. “It’s actually helping them and it does make a big difference,” said Carace. The prescriptions have helped them become “better employees than they were” before, he explained.

Cromwell advised PMPs to amend existing drug and alcohol policies to include marijuana (recreational and medicinal) and for PMPs without a policy to get one. Many resources exist online to download a standard policy, but customize the supporting program — the details for what happens should employees violate the policy — to your workplace, she said.

Over the past year, 30 percent of companies updated employee handbooks, drug policies and related documentation to manage safety and employment law-related risks of recreational and medical use of marijuana, according to the Littler Mendelson survey.

Fourteen percent conducted training for HR professionals and managers; and 14 percent communicated the organization’s expectations or stance on marijuana product use to employees. Confusion surrounding employer obligations is likely why 49 percent of organizations took no action at all, found the survey.

For companies operating in multiple states — where marijuana is legal in some and not others — Seay urged PMPs to develop a policy that covers everyone equally. “I think that as a general principal it’s best to have a policy that applies to all employees, whether they’re in a different state or not,” he said.

TESTING JOB APPLICANTS. Marijuana was the most common illicit substance detected in workforce drug screenings, according to a 2019 analysis by Quest Diagnostics, a provider of diagnostic information services. Among the general workforce, the rate of positivity for marijuana in urine drug tests increased nearly eight percent last year and almost 17 percent since 2014. (Visit http://dtidrugmap.com for a detailed U.S. map of the findings.)

Drug tests look for delta-9-tetrahydrocannabinol (THC), the psychoactive ingredient in marijuana. THC is fat soluble so it stays in a user’s system longer than some other drugs/alcohol, even though he may no longer be impaired. Tests evaluate a person’s urine, oral fluid, hair or blood.

But changes to pre-employment screens are coming. Testing for marijuana in the state of Nevada and New York City will be prohibited as of Jan. 1 and May 10, 2020, respectively. “In those two places employers, QualityPro or otherwise, will not be allowed to test on a pre-employment basis for marijuana,” said Seay, who expects other states to follow suit. In Canada, pre- employment drug testing is generally viewed as an invasion of privacy.

Some employers are choosing not to test candidates for the substance. “We’re seeing more and more employers just removing marijuana from the testing panel. They just don’t want to deal with it in those states” where it’s legal, said Ben Johnson, vice president of FleetScreen, a drug and background testing company in Fort Worth, Texas.

Carace disregards positivity for marijuana in drug tests and instead focuses on drugs like cocaine, amphetamines, PCP and opiates. On the other end of the spectrum, Olson said a positive test for marijuana is a reason not to hire an individual. Rand is unsure how Rose Pest Solutions will evaluate the tests. “That’s where we have to come to a judgment: What is our level of acceptance?” he said.

For existing employees, Seay does not recommend performing “random” drug tests; test only after an employee is involved in a vehicular or work-related accident or when the employer has reasonable cause to believe the employee is impaired. Judging impairment from marijuana is more difficult than from alcohol and may involve vague symptoms like glassy eyes, slurred speech and not being in the right frame of mind.

PMPs said the best way to mitigate impairment risk is by hiring the right people from the get-go. Conducting criminal background checks, verifying licensing and certifications, checking references and doing face-to-face interviews can weed out suspect candidates (excuse the pun). So can exploring the candidate’s social media accounts and driving records.

After clearing these checks, Stephen Taylor, owner of Target Pest Control in Lower Sackville, Nova Scotia, asks new hires to sign an employment agreement. If they violate the agreement, such as by falling outside the rules of law by driving impaired, they can be dismissed.

“I can’t stop my employees on Friday night buying a case of beer. I sure the hell can’t stop them from buying Angel cannabis. But I can hope to God when they come to work Monday they meet all the laws and rules” and are fully competent to do the job, he said.

The author is a frequent contributor to PCT.

Editor’s note: This research was conducted by the University of California, Urban Entomology Laboratory. Syngenta provided financial support and necessary products for this study.

Argentine ants [Linepithema humile (Mayr)] are notoriously difficult to control. Native to South America, these ants have an unusual biology in that their colonies consist of several thousand workers and multiple queens. In most of their introduced range, workers from different colonies are not aggressive toward each other, allowing them to form a large supercolony, often linked by dense trails. Argentine ant nests are dispersed, but typically located in moist areas near a food source.

Found throughout the southern U.S. and California, Argentine ants can be very aggressive towards other small arthropods and insects, often impacting other ant species in the areas they colonize.

The colonies are mobile and relocate to more acceptable nesting locations whenever necessary. In some areas, they congregate in communal overwintering sites during colder months. Even if Argentine ants would not nest inside structures, the workers are very good at finding sweets within homes and quickly establishing foraging trails.

LIMITING PESTICIDE EXPOSURE. Insecticidal sprays are commonly used to control pestiferous ants around structures. Because the amount of insecticide the structural pest management industry (and the public) applies is frequently under scrutiny, it is important that pest management professionals (PMPs) do as much as possible to lower their environmental footprint. Utilizing various products with different modalities (active ingredients, formulations, etc.) in a strategic manner might be an important step in this effort. Among active ingredients currently available for ant control, thiamethoxam and indoxacarb are less commonly used by PMPs.

Thiamethoxam is a neonicotinoid insecticide. By mimicking the action of nicotine, it acts on the insect nervous system by binding to the acetylcholine receptor, triggering uncontrolled nerve activation and eventual paralysis. In California, thiamethoxam is not currently monitored in surface water samples. Indoxacarb is an oxadiazine insecticide, and it also acts on insect nervous systems by blocking the sodium channel. Indoxacarb was registered by U.S. EPA under its Reduced-Risk Pesticide Program (U.S. EPA 2000). In California, detection of indoxacarb in surface water samples is either extremely rare or almost non-existent (CA DPR, unpublished data).

Using Argentine ants as the target species, this study tested different combinations of spray and bait products containing thiamethoxam or indoxacarb in residential neighborhoods. Prior to the study, there had been relatively little information available about the effect of these active ingredients on Argentine ant control in the field. The findings from this formal field study might be useful for PMPs in developing their treatment protocols for ant management services.

GENERAL INFORMATION. Five residential houses (replicates) were used per treatment. Before the start of the experiment, houses were monitored for overall ant activity levels based on number of ant visits at monitoring tubes. Falcon plastic tubes (50 ml, Fisher Scientific) containing 20 ml of 25 percent sucrose solution were used as monitoring tubes. For each house, 10 monitoring tubes were placed along the perimeter. Each monitoring tube was covered with a plastic flower pot to protect it from direct sunlight and sprinkler irrigation.

After 24 hours, the tubes were capped, returned to the laboratory and weighed. The weight data were corrected for evaporative loss of the liquid during the 24-hour monitoring period. By calculating the difference between the initial weight and the adjusted weight of the remaining sucrose solution, we obtained the amount of sucrose solution consumed by the foraging ants over the 24-hour monitoring period. Based on this consumption amount, ant foraging activity level was estimated. One advantage of this type of monitoring is that it reflects an overall foraging activity of the ants over a relatively long period of time (i.e., 24 hours) rather than estimating the ant activity based on a snapshot observation (e.g., counting ant numbers on a trail for a fixed amount of time), in which the estimations could vary greatly depending upon the times of the day and ambient weather conditions.

The efficacy of the treatments were determined by comparing the ant activity levels between pre- and post-treatment monitoring sessions. Post-treatment foraging activity levels were standardized by dividing them by their own pre-treatment levels. The study was conducted between July 16 and Sept. 13, 2018. Argentine ants were consistently active during this time, and there were no dramatic shifts/changes in weather conditions (e.g., cold temperatures) that would impact the activity levels of Argentine ant populations in the field (see untreated control data below). We used one house as an untreated control. All products tested were supplied by Syngenta Crop Protection.

TREATMENT PROTOCOLS. Three different treatment protocols were developed by incorporating four different application methods: backpack sprayer, power sprayer, gel bait and granular bait.

Insecticidal sprays. The spray products tested were Advion WDG insecticide (indoxacarb) and Optigard Flex Liquid insecticide (thiamethoxam). The percentage of active ingredient in the finished spray was 0.05 percent for both products. A power sprayer was used to apply the Advion WDG and a backpack sprayer (Birchmeier Iris 4 Gallon Backpack Sprayer) was used to apply the Optigard Flex Liquid (see Figures 1A and 1B).

Insecticidal bait. The ant baits tested were 0.01 percent thiamethoxam gel bait (Optigard Ant gel bait insecticide), 0.22 percent indoxacarb (a new insect granule bait product; 0.75 pounds/1,000 square feet application rate) and 0.05 percent indoxacarb (Advion Ant gel bait insecticide) (see Table 1).

Application of gel bait. To maximize the availability and longevity of the gel baits, they were loaded into clear soft plastic tubes (19.5 cm by 0.5 cm diam) (Fig. 1C, inset). Using the tubes also helped prevent environmental contamination and the wasting of bait. The baits were injected into the tubes, leaving about 2 cm on the bottom and 3 cm on the top of the tube. The bottom end was heat sealed. The other end was covered with a piece of parafilm. The baits were placed into plastic cups with the heat-sealed ends on the bottom and stored in the refrigerator until placed out in the field. Each tube contained an average of 3.7 or 4.1 g of Optigard or Advion ant gel baits, respectively.

Each house was treated with 10-15 tubes containing the gel bait (total of 37-60 grams of gel bait per house) (Table 1). This amount of gel bait would be equivalent to the amount of gel bait from 1 or 2 gel bait syringes (30 grams per syringe). The tubes containing the baits were placed around the structure (Fig. 1C) on active ant trials whenever possible. Leaves, debris or small rocks were used to conceal the tubes.

Application of granular bait. A new indoxacarb insect granule bait product was used in this study. This product is pending EPA approval and will allow for reduced application rates, less dust during application, and the attraction of protein- and carbohydrate-feeding ants. We applied the granular bait to mulched flower beds or ground cover around structures (Fig. 1D). Approximately 0.15 pound (2.4 ounces) of granular bait was weighed and placed in a plastic bag, providing enough bait to treat 200 square feet. Depending upon the size of the areas that needed to be treated with the granular bait, the number of bags applied were different at each structure. On average, we used 2.5 ± 0.5 bags (mean ± SD) of the granular bait (0.37 pounds or 5.9 ounces) per house (Table 1).

RESULTS. What follows is a review of treatment efficacy and the amount of time spent performing treatments.

Treatment efficacy. Ant foraging activity levels are standardized by their own pre-treatment levels and results are summarized in Fig. 2. The data presented are the mean values from five replications (except the untreated control). Some findings from pre- and post-treatment monitoring sessions:

1. At week one post-treatment, the treated houses showed mean reductions of ant numbers between 71 and 91 percent compared to their own pre-treatment data. During this period, the untreated control house had more than 2.5 times increase in ant activity.
2. At week two post-treatment, the treated houses showed mean reductions of ant numbers between 72 and 88 percent compared to their own pre-treatment data. During this period, the untreated control house had more than 2 times increase in ant activity compared to its initial value.
3. At week four post-treatment, the treated houses showed mean reductions of ant numbers between 87 and 93 percent compared to their own pre-treatment data. During this period, the untreated control house still had a substantial level of ant activity that was higher than its own initial value.
4. At week eight post-treatment, the treated houses showed mean reductions of ant numbers between 80 and 95 percent compared to their own pre-treatment data. During this period, the untreated control house also started to show some reduction in ant activity level, being about 54 percent of its own initial value.

Time spent for treatment. Applying about 3 gallons of spray (Optigard Flex Liquid) around the house with a backpack sprayer took about 15 minutes. Finding the adequate locations for placing the baits took another 10 to 15 minutes. In general, these treatment protocols took three technicians about 10 to 20 minutes to complete each treatment (about 30 minutes between two technicians), one applying sprays and the other placing baits in proper locations (or assisting with the power spray operation). The use of a power sprayer (treatment 3) might save time, requiring about 13.2 minutes per house between three technicians (compare this to 16.6 minutes for treatment 1, where the backpack sprayer was used). See Table 2 for the time spent for each treatment.

DISCUSSION. All treatments were effective in providing a substantial control of Argentine ants at the houses over eight weeks during a period of peak Argentine ant activity. The results show that thiamethoxam and indoxacarb products are viable options for pest management professionals in managing Argentine ants. The relatively small standard deviations in the data of treatment 2 (thiamethoxam spray + thiamethoxam gel bait + indoxacarb granular bait; see Figure 2) suggests that it provided the most consistent data across the five treated houses.

Argentine ant control continues to be labor intensive. IPM approaches to managing this invasive pest include inspections, the use of multiple formulations and baiting techniques, all of which may be time consuming. Pest management professionals spend 20 to 25 minutes treating a typical residential account for ants, with either a monthly or bi-monthly treatment schedule. Our treatments described here were labor intensive, and a single technician could spend 30 to 60 minutes at each structure.

For example, a comprehensive treatment such as treatment 2 that provided more than 88 percent reductions in the Argentine ant activity for at least eight weeks might require about 45 minutes for a single technician. However, our treatment strategies might fit nicely into a program utilizing quarterly treatments. Furthermore, the use of a power sprayer or an electric backpack sprayer also might help reduce the time required for each treatment.

Choe, Greenberg, Campbell and Rust are with the Department of Entomology, University of California, Riverside. Paysen is with Syngenta Crop Protection, Greensboro, N.C.

Reference cited

U.S. EPA. 2000. Pesticide fact sheet: Indoxacarb. U.S. EPA, Washington, D.C. A reduced-risk pesticide use is defined as one which “may reasonably be expected to accomplish one or more of the following: (1) reduces pesticide risks to human health; (2) reduces pesticide risks to non-target organisms; (3) reduces the potential for contamination of valued, environmental resources, or (4) broadens adoption of IPM or makes it more effective.” Indoxacarb qualifies under one or more of these criteria.

In February, PCT published an in-depth report on spray polyurethane foam (SPF) insulation and its impact on termite inspection and control.

An increasing number of homeowners, especially in the Southeast, are installing the insulation in crawlspaces and attics to improve energy efficiency. Builders are using the foam in newly constructed homes as well.

Pest management professionals, however, say that the foam makes it difficult, and at times impossible, to properly inspect for termites and wood-destroying beetles and fungi, especially when the foam covers sill plates, floor joists and foundation walls.

As a result, a growing number of PMPs are voiding the termite damage warranties of clients who have retrofitted their homes with the foam. They’re walking away from new customers who have it, and are refusing to write termite/WDO (wood-destroying organism) inspection letters for real estate transactions for homes with SPF.

NOW, FUMIGATION CONCERNS. PMPs who fumigate to control drywood termites are facing SPF-related challenges as well.

SPF is the material most-often used to create an enclosed or “unvented” attic. The foam is applied to attic walls, floors and ceilings, sealing fans and vents. (In new homes, attic fans and vents may not be installed at all.) This brings the attic into the building envelope, where it maintains a temperature similar to the rest of the house instead of reaching 150 degrees on a hot day. As a result, less energy is needed to cool the house and the comfort level for occupants is much improved.

Current fumigation aeration methods, however, rely on attic vents to draw gas out of the structure. As such, some PMPs have reported extended aeration times for fumigations at homes with unvented attics; some up to three days instead of the standard 24 hours.

In September 2018, Douglas Products and Ensystex sent letters strongly recommending that fumigators stop using Vikane and Zythor fumigants in homes with SPF in attics pending further evaluation.

“Douglas Products is actively looking into the foam issue and currently conducting our research. We do not yet have specifics available. We will communicate more once we have additional information to share,” wrote Heather Kern, commercial leader, Douglas Products, in an email to PCT. She could not provide a definitive timeline for when the tests would be completed but she expected them to wrap up before year end.

PCT was told that the company is conducting laboratory tests on the spray foam and is testing enhanced aeration methodologies in the field.

Any changes to fumigant labels and application/aeration instructions won’t happen until that test data has been reviewed by U.S. EPA, which could be spring 2020, said Jim Fredericks, vice president of technical and regulatory affairs, National Pest Management Association.

Kurt Riesenberg, executive director of the Spray Polyurethane Foam Alliance, which represents spray foam applicators, took issue with Douglas Products for singling out SPF (he said the issue is not SPF but unvented attics). He said the company has not stayed current with new building practices and materials that could impact fumigants, and for taking too long to conduct these tests.

“We want this solved and we’re all basically being held hostage for months by one company who hasn’t even finished the first stage of this process to get us to the solution of getting EPA to accept all this and have business back to normal,” said Riesenberg, who spoke to PCT in June.

Fredericks recognized the spray foam industry’s frustration. “I can understand where those folks are coming from. I also know that pest management professionals want to do this work. I know that Douglas Products wants to sell fumigant. However, this process is just being approached with an abundance of caution, as it should be. There is a scientific process that needs to be taken,” he said. Fumigants are governed by FIFRA and label changes must be carefully vetted and then approved through EPA, he reminded.

WHAT ABOUT EFFICACY? Riesenberg said some PMPs are telling customers they cannot fumigate because SPF absorbs the gas, which he said is unproven. He said he expected SPF to perform better than other insulation materials in absorption and desorption tests in the laboratory. “The gas can’t get into our material like it can between the fibers of fiberglass or cellulose,” he said.

If true, this raises another question: Can fumigant penetrate SPF to get to the infested wood behind it?

“If you have wood-boring beetles or drywood termites and you fumigate a home for those pests, if you have spray foam insulation does it affect the efficacy?” asked Derrick Lastinger, program director for the Georgia Department of Agriculture’s Structural Pest Section and chair of the structural fumigation committee for the Association of Structural Pest Control Regulatory Officials (ASPCRO).

It’s a big question, said Sean Brantley, vice president, Emory Brantley & Sons Termite, Pinellas Park, Fla., and a member of the NPMA fumigation committee. He said 4-mil polyurethane sheeting is documented as effective in confining fumigant and “this is a lot thicker than 4-mil poly when you’re talking about inches of it.”

It’s possible the fumigant could have a pathway to infested wood from the outside of the structure but with every house constructed differently and of different materials this would be difficult to evaluate, said Brantley. Plus, it likely would require a longer exposure time and that’s not feasible given weather, clients’ schedules, the cost of doing business and the additional liabilities involved, he said.

REACHING CRITICAL MASS. Unvented attics were written into the building code 12 years ago. The issue with SPF is arising now because enough homeowners have retrofitted attics and builders have built enough new homes with unvented attics to where PMPs are coming across them, said Fredericks. He also cited the lag time between drywood termite infestation and fumigation. If an attic was sealed 12 years ago and that same year termites infested it, the infestation might not be identified for another seven years due to the lag time between infestation and detection.

Finally, PMPs may have encountered extended aeration times in the past but didn’t recognize a trend until they experienced more of them. “We just reached this critical mass where we said, ‘There’s something else going on here,’ and now we’re trying to get to the bottom of it,” he said.

The letter from fumigant makers does not prohibit PMPs from conducting fumigations at homes with spray foam in attics. “For us, that letter was carefully drafted so that it was a recommendation of restriction and not a mandate,” said Brantley. But it did imply the manufacturers won’t stand behind PMPs who proceed with fumigations and run into problems, he said.

Brantley has declined to perform fumigation at some homes with spray foam; at others he has pushed aeration times and excluded SPF-covered areas from the termite warranty. He expects more PMPs to change termite warranty contract language to exclude areas with SPF. Those who don’t “should probably have some sleepless nights thinking about whether or not you’re gaining control because you’re really just spraying and praying at that point,” he said.

PMPs said spray foam also hides moisture leaks and causes condensation to form between wood timbers and the foam due to differences in indoor/outdoor temperatures. This can result in wood-destroying fungi/rot that can be missed during a WDO inspection. “It opens the door to an additional layer of liability,” said Brantley.