Legislative Update: Ag bill clears conference committee
Less than two weeks remain in the state legislative session and lawmakers are working nights and weekends to wrap up budget and policy proposals ahead of their constitutional adjournment deadline on Monday, May 22. As deals are being finalized, MFU’s legislative staff has continued to work with lawmakers and administration officials to ensure that the needs brought forward by members through our grassroots policy development process are prioritized in bills relating to healthcare, agriculture, environment and infrastructure. A full slate of conference committee proposals can be found here.
These can be a stressful two weeks for lawmakers—compromise is essential to reaching a deal. If you read about something you appreciate, this is a good time to reach out to lawmakers to say ‘thank you.’ It will be welcome!
During a midday hearing on May 6, the Agriculture, Broadband, and Rural Development conference committee adopted an agreement that is likely to pass and serve as the next two-year budget for agriculture programs in Minnesota. The final deal was negotiated between Chairs Aric Putnam, DFL-St. Cloud, Samantha Vang, DFL-Brooklyn Center, and the Walz administration represented by Commissioner Thom Petersen and spends around $445 million, including the agreed to $48 million increase to ag programs over the next biennium.
Due to the advocacy of members throughout session, new investments align well with the priorities MFU brought before the committee including establishing a grain indemnity fund, expanding local and regional meat processing, supporting new and emerging farmers, soil health, biofuels infrastructure, cooperative development grants, ag emergency preparedness, and a host of other issues.
New biannual funding approved as part of this final budget agreement includes:
- $10 million in one-time funding to establish a grain indemnity fund, which will provide protection to farmers who sell grain in the event of an elevator failure. This was championed by Sen. Rob Kupec, DFL-Moorhead, and Rep. Ethan Cha, DFL-Woodbury.
- $2.7 million for meat processing proposals carried by Sen. Kupec, Rep. Cha, Sen. Mary Kunesh, DFL-New Brighton, Rep. Nathan Nelson, R-Hinkley, and Rep. Samantha Sencer-Mura, DFL-Minneapolis, including:
- $2 million in additional funding to help processors startup, expand or upgrade their facilities through the successful AGRI Value-Added Program
- $544,000 for a new program MFU brought forward to pay for scholarships to the technical colleges and workforce recruitment and retention.
- $150,000 to hire a meat processing liaison at MDA.
- $2.8 million for beginning and emerging farmers, including:
- $1.2 million to expand MDA’s Emerging Farmers Office
- $500,000 to continue the popular Down Payment Assistance program
- $600,000 to expand The Good Acre’s LEAFF program
- $500,000 to expand Farm Business Management scholarships
- $1.25 million to continue MDA’s Soil Health Financial Assistance program. There was 13 times more demand for this program than funding available last cycle. The expansion of this pilot was championed by Sen. Heather Gustafson,DFL-Vadnais Heights, and Rep. Kristi Pursell, DFL-Northfield.
- $750,000 to expand the biofuels infrastructure grant program, championed by Sen. Kupec and Rep. Luke Frederick, DFL-Mankato.
- $400,000 to fund Cooperative Development Grants at MDA, carried by Sen. Gustafson and Rep. Pursell. This is a program MFU helped establish last session.
- $2.1 million for develop and commercialize crops developed by the University of Minnesota’s Forever Green program.
- $4 million to reestablish the DAIRI program, which will provide grants to small and mid-sized dairies for enrolling in federal risk protection.
- $2.3 million in additional funding to expand MDA’s work on Farm to School.
- $200,000 in support for farmers markets.
- $2.3 million in additional support for the Agricultural Utilization Research Institute (AURI) to purchase equipment and retain quality staff.
- $200,000 in new funding to expand work on Farmer Mental Health.
- $3.11 million for zoonotic disease preparedness, including funding for the Board of Animal Health and $1 million for the ag emergency account.
- $90,000 for Wolf-Livestock Prevention Grants.
- $50,000 for the Center for Rural Policy and Development.
Also aligned with MFU’s requests this session, the bill provides funding to hire additional staff at the Rural Finance Authority, expand MDA’s International Trade office, and hire a climate coordinator in 2026. Finally, the bill allocates $100 million to the state’s Border-to-Border broadband grant program, allowing up to $40 million to be spent on a new pilot program designed to incent companies to build in low-density areas.
The deal for agriculture also funds items MFU did not advocate for this session, including a $7 million increase for MDA to maintain staffing and current service levels, $4 million for urban and youth agriculture grants, and $2 million for the Good Food Access program.
Lawmakers also came to an agreement on policy items. The bill will include very limited changes to the grain indemnity fund and the proposal MFU brought forward to bar confidentiality clauses in carbon market contracts, carried by Rep. Pursell and Sen. Kunesh.
The bill will make changes to Minnesota’s Board of Animal Health, but within the parameters MFU requested throughout budget conversations. The compromise deal will expand the six-member board to seven, require that the tribal representative be “experienced in animal husbandry,” and add a veterinarian who specializes in companion animals. The bill also directs the governor to strive for geographic and gender balance among the board’s membership.
Finally, the bill requires MDA to review the science on PFAS in pesticides and sets the state on a path to ban these substances being intentionally added to agriculture inputs by 2032. You can read the full language here.
While no legislative text is available as of early Wednesday morning, the committee voted on compromises between the House and Senate versions of the omnibus bill. Complete text will be made available here when it’s finalized by legislative staff. Once completed, the compromise deal (SF1955) will be voted on by the full House and Senate. If approved without amendment (which we expect) the deal will then be sent to the Governor Tim Walz for his signature.
Also on agriculture, the governor signed into law a bill, sponsored by Chairs Putnam and Vang, to authorize an additional $50 million for the Rural Finance Authority revolving loan account, which supports MDA’s Beginning Farmer Loan and other important programs.
“Minnesota’s farmers and producers feed and fuel our state and country. Minnesota is committed to helping our new and emerging farmers grow and succeed,” said Walz in a release on the bill. “These loans will prioritize beginning farmers, helping them get on their feet and started on a path toward success.”
Outside of agriculture, MFU has continued to advocate for reining in prescription drug costs and finally establishing a MinnesotaCare public option that will allow farmers and others to ‘buy-in’ to the state program that covers many low-income Minnesotans. Proposals to establish a public option—which would require a federal waiver and wouldn’t be fully implemented until 2027—were included in both healthcare omnibus bills brought forward by Chairs Melissa Wiklund, DFL-Bloomington, and Tina Liebling, DFL-Rochester and included in the Walz administration’s budget request.
Slam dunk, right? Unfortunately not. The proposals regarding a public option are still the subject of debate and no final deal has been reached. You can contact your legislators and otherwise get involved with a broad coalition working to pass a MinnesotaCare public option here.
On prescription drugs, a deal to establish a Prescription Drug Affordability Board (PDAB), giving the state the ability to serve as a watchdog on price hikes, seems to be final and will be included in the commerce omnibus bill.
MFU President Gary Wertish’s letter to lawmakers connected prescription drug costs to concentration, making the case for state oversight.
“From 1995 to 2015, the 60 largest pharmaceutical companies merged to only 10. In 2017 just four companies produced more than 50 percent of all generic drugs. This merger wave has given drug manufacturers massive market power that allows them to gouge Minnesotans. From 2000 to 2018 the largest drug companies made $1.9 trillion in net income and a study from the University of Pittsburgh revealed a major source of that profit is from simply raising the prices of drugs already on the market,” he wrote. “The PDAB, along with new prohibitions on excessive price-gouging of generic prescription drugs, will help Minnesotans afford the medications they need and reign in overall healthcare costs.”
Speaking of oversight, on Monday the Minnesota House approved (70-61) Rep. Robert Bierman’s, DFL-Apple Valley, proposal (HF402) to require the Attorney General to approve large hospital mergers like that proposed by Sanford and Fairview. In line with the Special Order of Business voted on at convention, MFU has made the case throughout session that monopolies in healthcare increase prices paid by patients and reduce quality of care. Under the bill the Attorney General Keith Ellison—in consultation with the Department of Health—would be able to block mergers of entities larger than $40 million if they would substantially decrease competition or create monopoly conditions.
Still to come this session
Through the remainder of session, MFU will spending a significant amount of time in the tax conference committee where Chairs Anne Rest, DFL-New Hope, and Aisha Gomez, DFL-Minneapolis, will finalize the cornerstone of the state’s next budget. For agriculture, we’re continuing to advocate for:
- Extending and expanding the Beginning Farmer Tax Credit by eliminating the sunset on the program, allowing family members to participate for sale of ag land to assist in generational farm transition, increase the credit for sale of agriculture assets from 5 percent to 8 percent and up to $50,000, and increase the credit for sale of agricultural assets to Black, Indigenous, and farmers of color from 5 percent to 12 percent and up to $50,000.
- Funding Soil and Water Conservation Districts (SWCDs) through a new local government aid program to provide them with the stable, long-term funding they need to best assist our family farmer members in meeting their on-farm conservation goals.
- Increasing the first tier ag homestead limit from $2.15 million to $3.5 million to better keep pace with skyrocketing land values and provide needed property tax relief. This bill was carried by Sen. Bill Weber, R-Luverne, and was only included in the Senate side.
“According to the University of Minnesota, farmland prices increased an average of nearly 30 percent in 2022 with some selling for as much as $20,000 per acre,” Wertish wrote to conference committee chairs. “These skyrocketing prices make it more difficult for small and mid-sized farmers to afford their property taxes and hold onto family operations. Increasing the first-tier ag homestead limit to $3.5 million would cover 350 acres at $10,000 per acre (fair in many counties across the state). This is still well below Minnesota’s average farm size of 445 acres.”
As always, this is just some of what MFU’s team has kept busy with this week. If you have questions, thoughts, or concerns about our legislative work, please reach out at email@example.com or (320) 232-3047.