As of Wednesday, March 27, the legislature is preparing to break for a short holiday recess after a busy lead-up to committee deadlines and the release of joint budget targets. While much could change in the coming weeks, a final deal for the 2024 session is starting to take shape.

The legislature breaks this afternoon and will resume activities at noon on Tuesday, April 2 after Easter Recess. In case you’re hoping to connect with legislators back in their districts, the legislature will also break on April 10 for Eid and again from April 20 through April 23 for Passover. This leaves around 30 workdays through the constitutional end of session on Monday, May 20. Time is short!

Since our last legislative update, committee deadlines passed on Friday, March 22. This means that of the over 5,000 bills that have been introduced in each body, those that don’t require spending or deal with taxes need to have earned a hearing in both the House and Senate. Of course, as with many rules, there are notable exceptions and workarounds, but much of what was proposed this year will be tabled until future legislative sessions.

Budget updates

Other session-defining news came with two major budget updates. First, last week, the governor released narrow recommendations for a $226 million supplemental budget. Unlike last year and as the governor promised, the proposal was restrained and included no increases in revenue. For reference, that’s just over 6 percent of the projected $3.7 billion budget surplus this session.

Important for MFU, the top funded budget item in the agriculture space was a one-time, $4 million infusion in the AGRI program which faced a budget shortfall through the end of this biennium. While this does not maintain current funding levels, it will ensure that MDA can maintain current programs and service delivery through 2027. In particular in this budget line item, the governor highlighted that funding for AGRI should help support dairy and livestock farmers.

The governor also echoed Clean Water Council (CWC) recommendations for addressing nitrates in drinking water in the southeast, including a new influx of funding for the Agriculture Best Management Practices (BMP) Loan program. No cost items that are continued in the proposal include extending the Organic Advisory Taskforce, expanding availability of Farm to School and Early Care grants to in-home childcares, and increasing caps on Beginning Farmer Loans and others at the Rural Finance Authority.

Unfortunately, the governor did not recommend new funding for a MinnesotaCare Public Option, making securing ongoing support for this priority unlikely this session. If included, it would have been by far the largest budget recommendation in the proposal. That said, the governor did signal his support by recommending funding for planning and development of a Public Option.

While this is a setback, there are low or no-cost items the legislature can pursue this session—beginning work on the necessary federal waiver, for example—that will keep the state on a path toward allowing farmers and other small business owners to ‘buy-in’ to MinnesotaCare.

Other significant items in the governor’s budget request include an expansion of the Child Tax Credit, $16 million for struggling rural Emergency Medical Services in many parts of the state, and $5 million for food banks.

Second on budget developments, the governor and legislative leaders agreed to joint budget targets, which total an increased $512.5 million in new spending—continuing to show fiscal restraint in the face of a long-term structural imbalance. The agreement stipulates a $4.5 million increase for the Department of Agriculture. This could align with what the governor proposed, but only if the bulk of that new spending goes to backfilling the AGRI program.

On Tuesday, in Owatonna, Gov. Walz focused on past accomplishments in his State of the State address, touting work to “make Minnesota the best state in the country for a kid to grow up.” He also called on lawmakers to join him in passing a bonding bill that invests in “clean water, safe streets and affordable housing.”

Priority legislation moving

In addition to working to influence budget targets, MFU’s team has continued to advance priority legislation. Last week, the Senate workforce committee heard a bill reauthorizing meat processing technical training grants for high schools (SF4816/HF4930).

“We support this bill not only because of our longstanding support for ag education,” said MFU’s Government Relations Director Stu Lourey, “but also because this helps address a key workforce challenge experienced by our members.”

Agriculture Chair Aric Putnam, DFL-St. Cloud, also included a provision strengthening the state’s prohibition on companies including confidentiality clauses in ag marketing and processing contracts. This responds to concerns he heard from MFU members who are seeing lines on their milk checks stipulating penalties if they share information with others.

MFU has continued support for legislation that would strengthen rules governing nonprofit health maintenance organizations (HMO) that want to convert to for-profit. That legislation will make final committee stops this week before possibly being included in an omnibus health policy bill. As MFU’s Antimonopoly Director Justin Stofferahn has shared in testimony, the proposal (HF4853 / SF4837) matters for Minnesotans and MFU’s policy because these conversions, if not properly regulated, can take public healthcare investments and assets and turn them into private profits, increasing consolidation and contributing to high healthcare costs.

On the House side, the Agriculture Committee continued a discussion around the definition of “emerging farmer” and more specifically which farmers receive preference under the Down Payment Assistance Program, the Beginning Farmer Tax Credit and the Beginning Farmer Equipment and Infrastructure Grants. Chair Samantha Vang’s, DFL-Brooklyn Center, proposal (HF 4908) would create new qualifications and give preference to farmers experiencing limited access to land and markets.

The committee heard testimony from several emerging farmers concerned about the more limited definition. MFU has stayed in touch with MDA, Chair Vang, and Chair Putnam on this issue and worked to ensure that a final definition continues to serve emerging farmers well. Chair Vang has assured MFU and other advocates that her continued goal is to make these programs sustainable so that they can continue to serve farmers.

“We want to thank Chair Vang for continuing to work on this,” said Agriculture Commissioner Thom Petersen in his testimony. “The bottom line is, [because of this program] almost 100 new farmers will own a farm in Minnesota. That’s a pretty neat thing.”

Importantly, Chair Vang’s proposal does not change the definition of “emerging farmer” for the purposes of the state’s Emerging Farmers Working Group.

Women in Ag day

Monday marked the first “Women in Agriculture” day at the legislature. Due to the snowy weather, women farmers and agricultural professionals joined virtually to celebrate the day and share their stories with legislators. Sen. Mary Kunesh organized the event in partnership with UMN Extension, USDA Farm Service Agency and the Minnesota Department of Agriculture.

“I couldn’t be here today without the work of rural women leaders that came before me,” said MFU Vice President Anne Schwagerl in offering welcoming remarks to kick off the day. “From Coya Knutson, who arrived at farms early in the morning to campaign for Congress, to Norma Hanson, who served as the first female vice president of Minnesota Farmers Union. These names we know, but there are countless women whose name we don’t know, but they worked in their communities to create opportunities for you, me and our daughters.”

The Senate Agriculture Committee heard testimony from women across the state about the challenges and successes of their operations. The day closed with reflections and excitement for next year’s Women in Agriculture Day celebration.

Federal action

On the federal level, Congressional leaders unveiled a $1.2 trillion budget package that could finally bring the protracted process of finalizing the fiscal year 2024 (FY24) budget to a close. The measure includes increased funding for the military while keeping funding for non-defense agencies approximately flat. This agreement is in addition to a six-bill package that was passed into law several weeks ago that included agriculture appropriations. A key victory was the exclusion of any “policy riders” that would have prohibited Packers and Stockyards Act rulemaking. Unfortunately, that six-bill package did include provisions that will restrict funding for the Antitrust Division at the US Department of Justice. MFU sent a letter to the Minnesota Congressional delegation asking them to work to reverse the harmful changes that were made and Sen. Amy Klobuchar, D-Minn., continues to lead efforts to reverse those changes.

The Federal Trade Commission released a report last week examining the role consolidation played in creating supply chain issues in the grocery sector during the COVID-19 pandemic. The report found that dominant retailers used their market power to demand suppliers fill their shelves first, likely at the expense of smaller stores. One example is Walmart (controls over a quarter of the grocery market) requiring suppliers to fulfill 98 percent of the retailers orders on time and in full to avoid significant cash penalties, which meant while Walmart’s shelves were full, smaller competitors’ shelves were empty. The report is yet another example of the way corporate monopolies create less resiliency and make the economy more vulnerable.

On biofuels, the federal government has yet to release final guidance for the 40B Sustainable Aviation Fuel tax credit in regards to the feedstock calculations, which were supposed to be released March 1. National Farmers Union along with other commodity and biofuel groups are concerned about the delay and wrote a letter to the administration urging a quick resolution that allows for climate-smart agriculture to contribute to emissions reductions in aviation fuels.

The EPA did release new rules for tailpipe emissions standards for passenger vehicles. NFU has raised concerns with EPA regarding the rule’s disregard for existing renewable low-carbon and biofuel technologies that have the opportunity to provide immediate benefits, the unfair advantage the rule affords electric vehicles in calculating emissions reductions, as well as the ability of the auto-industry to meet the rule’s objectives.

NFU and other agriculture and biofuel groups also urged the EPA to enact an emergency waiver to allow for E15 sales. The letter cites new and ongoing conflicts across the globe which put the U.S. energy supply at risk, “attacks on shipping in the Red Sea have already had a disruptive effect on the transit of fuel in the region, raising the specter of constrained supply and increased gasoline prices at home.”

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