Legislative Update: Agriculture budgets released

It’s been a busy week at the legislature with lawmakers in the House and Senate compiling budget proposals ahead of the legislative break on April 5. As chairs work to craft their budgets across various jurisdictions, MFU has been engaged and constructive, ensuring that our priorities are reflected in a final deal.

Last Friday, March 24, marked third deadline at the legislature, meaning that—with notable exceptions—all finance and policy bills need to have been heard in committee to be considered for final passage. A majority of MFU’s priority proposals in the agriculture budget, on healthcare and in other jurisdictions met deadline. Others—like the proposal we’re working on with Attorney General Ellison’s team to establish a new ‘abuse of dominance’ standard in Minnesota antitrust law—are more expansive and will likely require a multi-session effort. This underscores the importance of MFU members contacting their legislators, in and outside of session.

To build their final omnibus budget bills, committee chairs need direction on two things. First, a narrowed list of policy and spending proposals that need to be considered. That list came with deadlines. And second, an upper limit on how much each chair can spend.

On Tuesday of last week, chairs received the latter in committee targets. These reflect a joint agreement between Governor Tim Walz, Speaker of the House Melissa Hortman, DFL-Brooklyn Park, and Majority Leader Kari Dziedzic, DFL-Minneapolis, and limit how much each committee can spend. This ensures that agreements by individual chairs add up to a balanced budget. The ‘target’ for agriculture—or increase above the base budget of approximately $167 million—is $48 million in largely one-time spending in the first biennium (‘24-25’) and $40 million in the second biennium (’26-’27). A challenge is that the Agricultural Growth, Research, and Innovation Program (AGRI) which houses farm to school, livestock investment grant, meat processing, and other popular programs is set to expire in 2026, leaving a $35 million hole in the ag budget in that second biennium.

Agriculture isn’t entirely unique in receiving what many would consider a low target in the ‘out years,’ ’26 and ‘27. That’s because most of the state’s surplus—about $12.5 billion—is one-time and does not carry forward.

This target combined with AGRI’s expiration make the job of chairs difficult—inevitably, tough decisions between worthy priorities will need to be made in order to craft a balanced budget.

Over the weekend, both Chair Aric Putnam, DFL-St. Cloud, and Chair Samantha Vang, DFL-Brooklyn Center, worked to put together their draft budgets. They were released on Monday and Tuesday, respectively, and MFU was quick to respond with formal written comment and in-person testimony in support of MFU priorities. In all, these were strong bills that included nearly all of the proposals we helped bring before the committee.

“While agriculture is the foundation of Minnesota’s economy—generating $112 billion in economic impact and supporting 430,000 jobs—the budget for MDA at present makes up less than one half of one percent of the state’s overall budget. We appreciate your work to expand this investment and believe it will help build a farm and food system that is more resilient, distributed and fair for farmers, workers and consumers,” said MFU President Gary Wertish in written comments to committee chairs.

You can review the Senate’s proposal here and MFU’s written response here, detailing the many MFU priorities Chair Putnam included in his budget.

“In all—and given the targets agreed to between the governor and legislative leaders—we believe this is a strong budget that reflects the priorities brought by our grassroots membership this year,” Wertish wrote to Chair Putnam and the Senate Ag Committee. Highlights of the Senate proposal include:

  • Establishing a grain indemnity fund – $14 million
  • Expanding local and regional meat processing – $6 million
    • Value Added Program grant for meat and poultry processing – $3 million
    • Employee recruitment and retention grants – $640,000
    • Hiring an MDA meat processing liaison – $150,000
  • Support for beginning and emerging farmers – $7.1 million
    • Establishing the Emerging Farmers Office– $1.1 million
    • Expanding MDA’s Down Payment Assistance program – $2.5 million, with $750,000 reserved for emerging farmers
    • The Good Acre LEAFF– $600,000
    • Beginning farmer scholarships for Farm Business management – $900,000
    • Farm Business Management grants and support for farmland transition through Farm Advocates
  • Soil Health– $4.85 million
    • Expanding and making permanent MDA’s Soil Health Financial Assistance Program – $2 million (with more in other funding bills)
    • Funding Ag BMP Loan program – $2.9 million
  • Forever Green – $3.45 million
    • Research – $1.95 million
    • Supply Chain Funding – $1.5 million
  • Biofuels infrastructure – $9 million
  • Cooperative Development Grants – $500,000
  • DAIRI program grants to small and mid-sized dairies to enroll in federal risk protection – $5.5 million
  • Rural Finance Authority administrative support– $300,000
  • Noxious weeds funding – $375,000, $375,000
  • Farm to School– $2.3 million
  • Farmers market food hubs – $200,000
  • Support for AURI – $2.3 million
  • Expanding MDA’s international trade office – $150,000
  • Farmer Mental Health outreach and counseling – $720,000
  • Support for Farm Advocates  – $674,000
  • Zoonotic disease preparedness – $3.11 million

The bill also included support for county fairs, replenishing the wolf and elk depredation accounts and funding wolf-livestock prevention grants, expanding Minnesota Grown and funding hemp processing.

The agriculture bill also carries $100 million in new broadband funding, which MFU supports.

On the House side, you can view Chair Vang’s proposal here and MFU’s response here. In general, her proposal includes many of the same priorities including grain indemnity, meat processing, beginning farmers and funding for cooperative development grants. MFU was sure to share our support for those provisions and appreciation to Chair Vang and her team. And—as is inevitably the case with budget targets—some are scaled to make room for other priorities.

The House bill also includes a restructure of the board of Board of Animal Health(BAH) about which MFU has shared concerns. The proposal would expand the board’s membership to 11 and remove the requirement that members be livestock producers or licensed veterinarians.

“This board makes devastatingly consequential decisions for livestock producers,” Wertish said in his letter. “We believe that [the proposed] “knowledgeable in animal agriculture, animal health, or pets and companion animals” is too loose a definition to guarantee that [the board’s] decisions will be informed by science and knowledge of current management practices.”

From here, both agriculture bills will be ‘marked up’ in committee, meaning the committee will consider and possibly adopt any amendments brought forward from committee members. After passages out of ag committee, packages will be sent to a final committee before being scheduled for debate and approval on the House and Senate floor. Once they’re passed off the floor, leadership will convene a conference committee to compare the two versions before a final, aligned version is again approved by both bodies and sent to the governor. It seems like a long and cumbersome process—because it is. But a relatively small budget like that for agriculture could move quickly.

Likely the most complex and potentially contentious proposal before both bodies is the establishment of a grain indemnity fund.  MFU members, MDA, the soybean growers, and others have been working hard to educate members of both committees about how the current system is broken resulting in devastating consequences for farmers. We have also been quick to point out that farmers already in effect pay for this broken system. When elevators pay for the mandated bonds, they pass that cost directly onto producers—and for next no protection when elevators fail. You can read MFU’s full comments on this proposal here.

In other jurisdictions, MFU’s priorities are similarly well-positioned, though there’s a lot left in session. The House Health Committee included Leader Jamie Long’s, DFL-Minneapolis, bill to expand MinnesotaCare with a public option, allowing farmers and others to ‘buy-in’ to state health coverage. Chair Nick Frentz, DFL-Mankato, included the proposal MFU brought forward to incentivize local production of fertilizer using wind and solar in his energy package at $12 million. And Right to Repair is expected to be included in the House and Senate Commerce packages, though the Senate version cut out agriculture equipment.

As always, this is a snapshot of MFU’s legislative work. Just in the past week, we’ve testified on funding for UMN Extension, bills to strengthen protections against healthcare megamergers, estate taxes and a host of other issues. If you have questions, concerns or thoughts on MFU’s legislative work, reach out to Stu at (320) 232-3047 (C) or stu@mfu.org.