Legislative Update: Federal relief efforts continue, state projects deficit
By Amanda Bilek, senior public policy director for the Minnesota Corn Growers Association
It has been a couple of weeks since my last legislative update and there have been a few developments at the state and federal level that Minnesota corn farmers should be aware of. The following will also provide an update on the policy issues Minnesota Corn staff continue to work on during this time.
Federal Update
The U.S. Senate returned to Washington DC this week, but operations in the chamber are not business as usual as the Senate adjusts to social distancing and other safety measures. The House of Representatives has not settled on a date to return, but work is underway on the development of the next version of a COVID-19 economic aid package. However, initial priorities outlined by House, Senate and White House leaders show there is a lot of work to be done in order to reach agreement.
On April 17, President Trump and USDA Secretary Perdue announced initial details for a Coronavirus Food Assistance Program (CFAP) as previously written about here, but we are still awaiting further details. Although a draft program rule has not yet been submitted to the Office of Management and Budget, Secretary Perdue has emphasized that he hopes sign up could begin in May and assistance out the door by the end of the month or early June. As soon as we have additional details, we will be sure to share it.
Biofuels Infrastructure
For those of us affiliated with corn farming, we know a top market for corn—ethanol—is facing significant economic challenges due to the drop in fuel demand.
As I have written about before, the Minnesota Corn Growers Association (MCGA) and our national affiliate, the National Corn Growers Association, are supportive of immediate, economic relief to ethanol producers. But once fuel markets show signs of recovery, increasing volumes of ethanol sales and expanding fuel retailer infrastructure for higher blends of ethanol will be important to help the ethanol industry and corn famers recover. Two recent developments provide hope for assisting producers, farmers and fuel retailers in that recovery.
First, on the legislative side. Last week, Congresswoman Abby Finkenauer (D-IA) with support from Congresswoman Angie Craig (D-MN) and Congressmen Roger Marshall (R-KS) and Don Bacon (R-NE) introduced the Clean Fuels Deployment Act, which proposes to authorize $600 million over six years to award funding to local governments for infrastructure installation. This infrastructure funding would help cover the costs of installing, converting or retrofitting pumps tanks, traditional and pipeline terminals, and other types of infrastructure to offer higher blends of ethanol and biodiesel. We will keep you posted on any legislative developments.
Second, on the administrative side, today the USDA published a Notice of Funds Availability for the Higher Blends Infrastructure Incentive Program (HBIIP) in the Federal Register. The program will be administered by USDA Rural Development and will provide up to $100 million in competitive grants to expand the availability and sale of renewable fuels. Approximately $86 million of total funding will fund higher blends of ethanol and remaining funding will be for biodiesel infrastructure. USDA Rural Development expects applications to open May 15 and will be open for 90 days.
The program also has a targeted assistance pool where 40 percent of funds are reserved for fuel retailers with ten or fewer stations. USDA expects the program will make about 150 awards covering 1500 locations. MCGA will be working with state and federal partners on this program and will keep you updated.
State Update
Less than two weeks remain in the regular session for the Minnesota Legislature, but legislative operations the last six weeks have been anything but regular compared to previous sessions. However, committees have continued to meet remotely to advance work and floor sessions in each chamber have occurred using social distancing measures.
The big news today that will define the rest of the regular session, and continue over the summer and into preparations for the 2021 legislative session is the projection by Minnesota Management and Budget that Minnesota has moved from a projected $1.5 billion surplus in February to a $2.4 billion projected deficit for the current budget cycle—a swing of nearly $4 billion.
Ongoing economic disruption from the current pandemic will continue to have a fiscal impact on the state budget going forward, and there are several uncertainties that will impact projections going forward.
House and Senate agriculture policy and finance committees have been meeting remotely to advance finance and policy bills. Negotiations are still ongoing on a few items as the bills move from committees of jurisdiction to full finance committees and consideration by the full House or Senate. Look for a detailed breakdown next week of items included in the agriculture finance and policy bills along with any other state legislative items of note.
Be sure to follow the MCGA blog and its social channels (Facebook, Twitter) for updates. You can also follow me on Twitter (@AjBilek).
