The state legislature is reaching the point where rubber meets the road. Committee deadlines are at hand and leaders in both houses released topline targets for spending across jurisdictions from healthcare to agriculture.

Earlier this week leaders in both the Senate and House agreed to budget targets—topline spending numbers for each committees jurisdiction. Both budgets showed restraint and reflected likely cuts. This foreshadows the difficult decisions facing lawmakers if they want to curb growth in spending and avoid a shortfall in the upcoming biennium. At current levels of taxes and spending, the state has a $456 million surplus in this two-year period, but is facing a nearly $6 billion deficit in years 2028 and 2029.

In the Senate, leaders propose saving approximately $750 million in the upcoming biennium, including a $365 million cut in the tax bill, $260 million cut in Health and Human Services, $227 million for transportation and public safety. For the Agriculture Committee, Senate leaders gave Chair Aric Putnam, DFL-St. Cloud, direction to cut $313,000 in spending in the upcoming biennium.

Senate Majority Leader Erin Murphy, DFL-St. Paul, said that targets “represent our commitment to families, children and seniors, and protecting the long-term stability of our state.”

“The decisions we make this session will help to prepare us for the uncertainty and chaos Donald Trump, Elon Musk and Congress are creating for Minnesotans as they take from the rest of us and give to the ultra wealthy,” she added.

In the House, DFLers and Republicans who share split control of that body came to a negotiated agreement for spending targets that included about $1.15 billion in cuts during the current biennium. The success of this lengthy negotiation is an encouraging development for anyone who was skeptical about the House’s ability to reach bipartisan agreement given the body’s historic tie.

“The objective here, from my perspective, was to make everyone a little bit unhappy,” said House Ways and Means Co-Chair Paul Torkelson, R-Hanska. “That’s what a true compromise looks like, and I think for the most part we’ve achieved that.”

“This was the first major test of our ability to work together under this power-sharing agreement and I’m really pleased that we passed that test and delivered a budget resolution on time,” said his Co-Chair Zack Stephenson, DFL-Coon Rapids.

For agriculture—and in contrast to the Senate—the House actually proposes a $17 million increase to spending in the agriculture jurisdiction. While this is a small amount when compared to the overall budget, this is a significant increase for the agriculture jurisdiction which makes up less than one half of one percent of the overall state budget.

Negotiations continue

Going forward, the House, Senate and governor will negotiate joint spending targets that will serve as the final topline spending number for each jurisdiction.

With deadlines fast approaching and targets released, Putnam released his budget on Tuesday and took testimony on Wednesday. MFU provided both lengthy written testimony and verbal testimony sharing praise for items defended in the bill despite fiscal restraints.

“Your work on this state budget comes as our members are facing significant headwinds,” said MFU President Gary Wertish in his written testimony. “Traveling the state in the last two weeks for a series of 10 listening sessions, we heard firsthand about the impacts of an escalating trade war, cancelled federal contracts, layoffs at local USDA offices, lack of action on a Farm Bill, risk of animal disease, and increasing input costs. All these challenges are exacerbating the financial stress experienced by farmers and ranchers going into spring.”

You can see a spreadsheet detailing change items here.

In our written and verbal testimony, MFU shared support for:

• Expanding access to local and regional markets including by:
  • Increasing support for Farm to School and Early Care by $150,000 annually. This will help farmers access new markets and ensure young people have access to healthy, nutritious meals.
  • Creating a state Local Food Purchasing Assistance (LFPA) program, funded at $250,000 annually, to help organizations establish wholesale agreements with farmers, providing stable markets. Even beyond that—and much like farm to school efforts—this program is a win-win for communities, improving access to fresh healthy food for people who need it.
  • Dedicating support to the Good Acre’s LEAFF program which provides emerging farmers a reliable, consistent market for the products they produce, while also ensuring that Minnesotans have access to affordable, culturally relevant food.
• Expanding local and regional processing, including by:
  • New increased funding for state meat and poultry inspectors, $351,00 annually, to ensure that new processors seeking inspection can count on that critical service from the state. This investment is timely as a significant portion of our state meat inspection program is funded by the federal government, creating uncertainty about stable funding going forward.
  • Continued support for value-added grants through AGRI value-added program, which supports meat, poultry, dairy and other processors in starting up, expanding, or modernizing their facilities. This will help them serve more farmers, directly addressing the bottleneck experienced by our members across the state.
• Supporting new and emerging farmers and helping the next generation of farmers build a life in agriculture, including:
  • Increased Farm Business Management (FBM) support, by $125,000 annually, which will help new farmers and others weather financial challenges and ensure their farms are viable long-term.
  • Continued funding for the Emerging Farmers Office, ensuring that MDA will continue to implement the important work spearheaded by the Emerging Farmers Working Group making the department’s programs are equitable, accessible, and responsive to the unique needs of emerging farmers.
  • Continued funding for Down Payment Assistance which is a direct way the state helps get new farmers on the land.
  • Continued funding for farmland transition support through the continuation Farm Advocate program.
• Renewed funding for Farm Safety and Rural Mental Health ($75,000 annually) supporting outreach and counseling services and ensuring that MDA can continue their nation-leading work to support farmers experiencing crisis. This appropriation compliments other investments in mental health and safety by enabling MDA to operate the Farm and Rural Helpline, coordinate the Farm Safety Working Group, and other important initiatives.
• Continued funding for Farm Advocates to help expand their work to support farmers experiencing financial hardship.
• Zoonotic disease preparedness, including through direct investments in the Board of Animal Health (BAH) is critical for helping our state prepare for a renewed bout of HPAI, H5N1, and other animal diseases that pose a significant threat to our state’s livestock farmers. This includes
  • $1.5 million in new funding for the Ag Emergency Account, ensuring that the state is well-prepared to quickly respond in the face of an outbreak this spring.
  • New funding for ‘Protect grants’ ($250,000) to help poultry producers install technology to limit interactions with wild birds and prevent the transmission of avian influenza.
• Continued funding for Cooperative Development Grants, continuing this successful program helps people build and scale cooperatives that add value to MN-grown products, improve profitability, and keep money in rural communities.
• Livestock investment grant changes to help more livestock producers upgrade and improve their farm infrastructure. Originating at the county level, MFU members saw the value of this grant program and the need to increase the reimbursement amount to 50 percent for the first $20,000. This will help beginning farmers and those adding livestock to their operations by allowing them to get more meaningful cost share on installing watering systems, building fences, or adding shelter for grazing animals. This bill also maintains equity for larger projects by ensuring that projects above that threshold still get the increased reimbursement on their first $20,000.
• Continued funding for Soil Health Financial Assistance Grants ensuring this successful program will help more farmers get started with practices that make farmland more resilient to extreme weather events, retain topsoil, build organic matter, and promote water quality.
• Continued funding the UMN Forever Green Program to aid in the development of perennial and winter annual crops will help our family farmer members add value and diversity to their farming operations, deliver important ecosystem benefits, and remain resilient in the face of climate change. On the other hand, this proposal does not renew funding for market development and commercialization, which we also feel is an important strategic next step in developing new cropping systems in a way that supports small businesses, increases adoption, and ensures a fair price for farmers.
• Continued County fair support to help promote agriculture, enhance arts access and education, and preserve and promote our state’s history and cultural heritage.
• Wildlife depredation funding to support farmers and ranchers who’ve lost livestock to wolves, or crops and infrastructure to elk. These programs help compensate producers and limit the financial loss. Going forward, we support the committee consider continued investment in wolf-livestock prevention grants, which help mitigate conflicts before they happen.

Acknowledging the fiscal challenges facing the state, MFU shared concerns about a few items in Putnam’s bill—primarily when it came to cuts to existing programs. MFU shared concerns about:

• Not making AGRI a dedicated account (SF1172, Kupec), a provisions that was heard by the committee, but not included in the bill. This proposal—while seemingly technical in nature—would ensure that funding allocated to this flagship program stays in AGRI. This structural change would grant MDA flexibility and—in effect—make more money available to Farm to School and Early Care, biofuels infrastructure grants, Farm Business Management scholarships, and more. This change would ensure that AGRI has more undesignated funds to quickly respond to challenges as they have with COVID-19, 2021’s historic drought, and recent outbreaks of HPAI.
• $3 million cut to the Green Fertilizer Grant program, which MFU worked hard to establish in 2023.  This nation-leading pilot program not only invests in green fertilizer production, but also incentivizes farmer ownership of production facilities through Minnesota’s existing network of farmer-owned cooperatives. Projects are hugely capital intensive and early investment from the state will could prove consequential for getting distributed, farmer-owned production capacity online soon.
• $1.5 million cut the DAIRI Program, a program was created in 2023 to help small and mid-sized dairies access federal risk protection, manage increasing input costs, and weather market volatility. Unfortunately, lack of action on an updated Farm Bill has meant that this money has gone unspent. The funding was instead diverted to the state’s response to H5N1.
• $500,000 cut to biofuels infrastructure grants each biennium. MFU pointed out the success of this program for expanding the use of higher-octane, cleaner-burning biofuels through upgrading the infrastructure at fuel retailers across the state will help consumers save money and support an important market for family farmers.
• Lack of funding for noxious weed grants, long funded by the committee, which helps with detection, control, and management. This is a threat to producers’ livelihoods, and we support Minnesota continuing support to County Agricultural Inspectors.

If you have questions, thoughts or concerns about MFU’s legislative work, reach out to Stu at stu@mfu.org or (320) 232-3047.

Trump administration proposes antitrust cuts

A proposal to reorganize the Department of Justice could have significant impacts on the Antitrust Division. In an internal memo obtained by Reuters, Assistant Attorney General for Antitrust Gail Slater details several proposals that would shrink the division’s spending. This includes moving staff in the advocacy and economics sections of the division to different parts of DOJ, eliminating their focus on fighting monopoly power.

Slater has also proposed closing the division’s field offices in Chicago and San Francisco. The closing of the Chicago office could be particularly detrimental to efforts to more aggressively police anticompetitive conduct in agriculture. Slater’s predecessor, Jonathan Kanter, had announced a plan in June 2024 to increase staffing in Chicago dedicated to civil and criminal enforcement in the sector.

A final proposal detailed in Slater’s memo is to cut funding used to hire outside economic experts and instead rely more heavily on the agency’s in-house economic experts, something that will become more challenging to do if those economic experts are moved into other offices within DOJ.

The effort to reduce staffing at the Antitrust Division contradicts the purpose of the Merger Filing Fee Modernization Act. This bipartisan legislation spearheaded by U.S. Sen. Amy Klobuchar, D – Minn., was intended to increase resources for antitrust enforcement.