Legislative Update: Special session adjourns and MCGA heads to Washington (virtually)
By Amanda Bilek, senior public policy director for the Minnesota Corn Growers Association
Congress returned to D.C. this week following a two-week Independence Day recess with a long to-do list before the scheduled August recess. Back home, the Minnesota Legislature adjourned the second special session of summer.
Before we took a look at the latest information corn farmers need to know, I wanted to provide an update on a virtual fly-in the Minnesota Corn Growers Association (MCGA) will be having on July 21 and 22.
MCGA Virtual D.C. Fly-In
COVID-19 has impacted every aspect of personal and professional life. The policy work we do at MCGA on behalf of our members and Minnesota corn farmers has also had to adjust. Starting Tuesday, MCGA directors and farmer leaders will be conducting a virtual fly-in where we are meeting with members of the Minnesota Congressional delegation to discuss policy issues that are critical for Minnesota corn farmers during this unprecedented time.
In our virtual visits, MCGA farmer leaders will be emphasizing phase four COVID-19 relief for agriculture—especially for the 2020 crop—as well as maintaining the integrity of the Renewable Fuel Standard and boosting U.S. agriculture exports through a fully honored Phase I agreement with China and other trade agreements. MCGA will also be focusing on Congressional efforts to authorize critical infrastructure investments through the Water Resources Development Act and the Highway bill.
There is no shortage of issues to address that are important to corn farmers, and even during today’s challenging times, MCGA will adapt and continue to advocate on behalf of our members.
Next COVID Relief Package
The timing for the MCGA virtual fly-in is good because members of Congress returned to D.C. this week to ramp up negotiations on the fourth package for COVID-19 relief. Negotiators first need to determine spending caps and deadline for the next package, but all sides have expressed a commitment in putting something together.
Senator Majority Leader McConnell has said that he wants to keep the package closer to $1 trillion while the House passed their version of a relief bill, the HEROES Act, which totaled $3 trillion.
In addition to the overall spending target, there are also several key policy issues negotiators will need to come to agreement on, including liability protection for businesses, unemployment benefits, aid to state and local governments, another round of stimulus checks and health care funding.
MCGA is urging Congress to include relief for the 2020 crop, biofuel producers and for producers and processors whose harvest or processing is disrupted by COVID-19. MCGA would also like to see the Commodity Credit Corporation fully replenished so USDA has the resources necessary to carry out Farm Bill programs and provide emergency relief. We will keep you updated on developments.
Minnesota Legislature Adjourns Second Special Session without Agreement on Bonding and Tax Bill
The second special session of the summer adjourned early Tuesday morning with the legislature failing to pass a tax bill or bonding bill. Last week, HF 3 was presented to the House Ways and Means committee and amended to include the tax provisions along with the capital improvement investments. The public posting of the bill allowed those advocating for Section 179 conformity, including MCGA, to review the agreed upon language between the House DFL and Senate GOP majority.
The bill, if passed, would have provided tax relief for businesses and farmers at $90 million in FY 2020/2021 and $128 million in FY 2022/2023 by finally adopting full conformity on Section 179 in tax year 2020, as well as retroactively addresses a provision related to trade in equipment in 2018 and 2019. The retroactive fix is necessary since the 2019 Minnesota tax bill conformed to federal changes for like-kind exchanges, which resulted in some Minnesota famers paying income taxes on the “phantom” income gain from the trade-in since Minnesota did not adopt the immediate expensing provisions to offset the income gain. HF 3 would have rectified that issue.
The bonding portion of the bill was approximately $1.8 billion for local projects and infrastructure. Most bills only require a simple majority to pass, however a bonding bill requires that 3/5th of each chamber vote in favor. Since May, the House GOP minority caucus has maintained their position that would not lend any votes for the bonding bill unless they had agreement on projects included and the executive branch peacetime emergency powers were lifted or reduced.
If a deal is struck or Gov. Walz extends his emergency powers in August, there is potential for a third special session in the next couple of weeks. MCGA, along with other agriculture groups and the business community, will continue to press for state conformity on Section 179, and we are disappointed an agreement could not be reached during the second special session. We urge legislative leaders to find agreement and pass this important tax provision for Minnesota farmers.
Be sure to follow the MCGA blog and its social channels (Facebook, Twitter) for updates. You can also follow me on Twitter (@AjBilek).
