Policy bill deadline approaches at State Legislature
An update from Minnesota Corn Growers Association Senior Public Policy Director Amanda Bilek
Next Friday—March 22—is the policy committee deadline at the State Legislature, meaning any policy bill must clear its House and Senate committees of jurisdiction by that day. The deadline for finance bills is April 19, though finances bills can be heard by certain committees—Capital Investment/Bonding, Taxes, and Rules in both chambers, Ways & Means in the House, and Finance in the Senate—after the deadline.
Even as the policy deadline approaches, activity on finance bills is expected to pick up, as we await the governor’s supplemental budget proposal. That proposal follows Minnesota Management and Budget’s release of the supplemental budget forecast on Feb. 29, which will guide legislators’ spending decisions in supplemental budget bills and potentially a capital investment bill. Full details from MMB are available here.
Since November, the state’s projected surplus increased by $1.3 billion to a total projected surplus of $3.7 billion for the current budget (FY 24-25). But it is important to look deeper into the budget projections. There is a projected surplus of $2.2 billion for the next budget cycle (FY 26-27) but only if no new spending is enacted this year. That is unlikely to occur because there are spending programs enacted in 2023 that are costing more than projected, and specific program deficits will need to be reconciled in the supplemental budget. Therefore, the current budget and projections for FY 26/27 indicate more of a structural imbalance. Legislative leaders are still urging caution on any new spending proposals for this year.
Last week, Minnesota Corn Growers Association (MCGA) President Dana Allen-Tully spent a day in St. Paul meeting with members of the state House and Senate agriculture and environment committees who grower-leaders were unable to meet with during our annual Day on the Hill. Given that President Allen-Tully farms in southeast Minnesota, the bulk of our discussions throughout the day focused on nitrogen use efficiency in her region, but also other vulnerable groundwater areas of the state. We also emphasized all the efforts by Minnesota’s corn farmers and Minnesota Corn to manage crop nutrients and outlined activities Minnesota Corn has committed to that build on previous efforts.
A few updates on issues MCGA is working on at the Legislature:
HF 4135/SF 4311 is a proposal authored by Rep. Rick Hansen (DFL-South St. Paul) and that would increase the current Minnesota Department of Agriculture inspection fee on July 1, 2025, to 70 cents/ton on all fertilizer products sold containing nitrogen and would add a new fee of 99 cents/ton enacted retroactively to July 1, 2023. The fee would increase to $1.39/ton for anhydrous ammonia on July 1, 2025, and retain the 99 cents/ton fee on all other fertilizer products with nitrogen. Revenue collected under the new fee would be deposited in a private well drinking water assistance account and would be used for grants in southeast Minnesota to provide aid to citizens with drinking water wells that exceed the drinking water standard.
MCGA is opposed to this bill for several reasons. First, it would increase costs for farmers at a time when crop prices have decreased and margins are tight. A better approach would be to use general funds or dedicated funds, such as the Clean Water Fund, to provide the necessary aid to southeast residents with wells above the drinking water standard. Second, using dedicated or general funds is also a better option because it would be more expedient to target aid where it is needed and assist state agencies in executing the workplan submitted to the Environmental Protection Agency in response to the southeast environmental group petition. Finally, we cannot support increasing a tax on farmers statewide to help address a specific geographic problem.
When HF 4135 was heard in the House Agriculture Committee, it passed on a 7-6 vote and was re-referred to the House Environment Committee, where a hearing has not been scheduled. SF 4311 awaits action in the Senate Agriculture committee.
SF 2584/HF 2602 was introduced last year and is a clean transportation standard (CTS) or a low-carbon fuel standard. The policy would set a target for reducing the collective carbon intensity of transportation fuels by a set date compared to a baseline. Transportation fuels that exceed the carbon intensity-reduction target would generate credits, and fuels that don’t meet the target would generate deficits. Fuel producers with deficits would need to purchase credits to be compliant with the policy.
A CTS is a multi-faceted policy that could have broad-scale implications across the transportation sector, including to biofuels and agriculture. If the policy is not designed to accurately measure carbon reductions from biofuels or biofuel feedstocks, it could put biofuels at a competitive disadvantage when scored against other options such as electric transportation.
The CTS bill was heard in the Senate Transportation committee on March 4 and was laid over for possible future action after a lengthy list of testifiers, mostly in opposition, weighed in with the committee. It was amended by Sen. Scott Dibble (DFL-Minneapolis), but it still does not yet meet a set of principles developed jointly by the Minnesota Biofuels Association, MCGA, Minnesota Soybean Growers Association, Farm Bureau, Farmers Union, and Biodiesel Council. The Minnesota Biofuels Association provided testimony on behalf of the agricultural and biofuel groups. There has been no action yet on a House version of the bill. Video from the hearing is available here, and the CTS portion begins after 1 hour and 43 minutes.
In addition to fertilizer tax and CTS outlined above, the MCGA policy team is also working closely on bills related to agricultural drainage, public waters, and grain licensing.
If MCGA members have any questions on bills under consideration at the Legislature, please feel free to reach me at abilek@mncorn.org.
