1.1                          A bill for an act 
  1.2             relating to agriculture; establishing Market Champ, 
  1.3             Inc.; providing for feedlot upgrade grants and loans; 
  1.4             limiting certain animal feedlots and feedlot 
  1.5             practices; providing for preparation of a generic 
  1.6             environmental impact statement on the long-term 
  1.7             effects of the livestock industry; creating a 
  1.8             livestock industry environmental steering committee; 
  1.9             appropriating money; amending Minnesota Statutes 1996, 
  1.10            section 116.07, by adding subdivisions; proposing 
  1.11            coding for new law in Minnesota Statutes, chapter 17. 
  1.12  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.13     Section 1.  [17.987] [MARKET CHAMP, INC; ACCESS TO QUALITY 
  1.14  GENETICS BY FAMILY FARMERS.] 
  1.15     Subdivision 1.  [ESTABLISHMENT; PURPOSE.] Market Champ, 
  1.16  Inc. is established as a nonprofit public corporation under 
  1.17  chapter 317A and is subject to the provisions of that chapter. 
  1.18  The corporation is neither a state agency nor an entity within 
  1.19  the University of Minnesota.  The purpose of the corporation is 
  1.20  to enhance the state's economic growth and the competitiveness 
  1.21  of family farmers.  Market Champ, Inc. shall assist Minnesota 
  1.22  swine producers in understanding genetic technologies and 
  1.23  developing improved animal genetic lines. 
  1.24     Subd. 2.  [DUTIES.] (a) Market Champ, Inc. shall: 
  1.25     (1) encourage family farmers to use the highest quality 
  1.26  swine genetics; 
  1.27     (2) facilitate the transfer of the latest swine genetic 
  1.28  research and technology information and materials from the 
  2.1   University of Minnesota and other sources to family farmers; 
  2.2      (3) assist family farmers to market the swine they produce; 
  2.3   and 
  2.4      (4) develop a system for tracking their products through 
  2.5   the processing, meat packing, and marketing system to determine 
  2.6   the market value of the genetic technology. 
  2.7      (b) Market Champ, Inc. shall: 
  2.8      (1) provide genetic testing, counseling, and assistance in 
  2.9   genetic decisions to identify new market developments and 
  2.10  capture value-added opportunities; 
  2.11     (2) provide centralized testing services with regional 
  2.12  technology transfer specialists; 
  2.13     (3) secure access to new genetic tests and services for all 
  2.14  Minnesota producers through licensing agreements; and 
  2.15     (4) assist family farmers who do not otherwise have access 
  2.16  to high quality genetic technologies. 
  2.17     Subd. 3.  [BOARD OF DIRECTORS.] (a) Market Champ, Inc. 
  2.18  shall be governed by a board of directors consisting of voting 
  2.19  and nonvoting members. 
  2.20     (b) The voting members of the board shall be: 
  2.21     (1) representatives of small family farmers, purebred swine 
  2.22  producers, the Minnesota Pork Producers Association, appropriate 
  2.23  representatives of the pork industry, and members of the meat 
  2.24  packing industry as determined by the president of the 
  2.25  University of Minnesota or a designee of the president, in 
  2.26  consultation with the chairs of the senate and house of 
  2.27  representatives committees with jurisdiction over agricultural 
  2.28  policy issues; 
  2.29     (2) the University of Minnesota, and educational 
  2.30  institutions, if any, as designated from time to time by the 
  2.31  board with expertise in the genetics of the swine industry and 
  2.32  agriculture; 
  2.33     (3) the governor or a designee of the governor; 
  2.34     (4) the commissioner of agriculture; 
  2.35     (5) the president of the University of Minnesota or a 
  2.36  designee of the president; and 
  3.1      (6) other persons, if any, as designated from time to time 
  3.2   by the board. 
  3.3      (c) The nonvoting members of the board shall be the 
  3.4   majority and minority leaders of the senate, the speaker of the 
  3.5   house of representatives, and the minority leader of the house 
  3.6   of representatives, or their designees. 
  3.7      (d) Meetings of the board are subject to section 471.705. 
  3.8      Subd. 4.  [EXECUTIVE COMMITTEE; EMPLOYEES.] (a) The board 
  3.9   of directors shall create an executive committee of 12 members 
  3.10  of the board including the commissioner of agriculture, the 
  3.11  vice-chair of the board of directors, and two members of the 
  3.12  legislature.  The president of the corporation shall be 
  3.13  appointed by the executive committee and ratified by the board. 
  3.14  The executive committee shall oversee the daily operations of 
  3.15  the corporation. 
  3.16     (b) Meetings of the executive committee are subject to 
  3.17  section 471.705 except when security, trade secret, potential 
  3.18  client lists, pending proposals, negotiations, employee matters, 
  3.19  or labor relations information are discussed. 
  3.20     (c) The employees of the corporation are not state 
  3.21  employees. 
  3.22     Subd. 5.  [BYLAWS.] Bylaws of Market Champ, Inc. must 
  3.23  provide for the qualification and removal of directors and for 
  3.24  filling vacancies on the board in a manner not inconsistent with 
  3.25  this section. 
  3.26     Subd. 6.  [OTHER COMMITTEES.] The executive committee may, 
  3.27  by resolution, create one or more committees, each consisting of 
  3.28  directors designated by the executive committee.  The duties, 
  3.29  responsibilities, and limitations of each committee must be 
  3.30  outlined in the resolution creating the committee. 
  3.31     Subd. 7.  [ARTICLES OF INCORPORATION.] The articles of 
  3.32  incorporation of Market Champ, Inc. must be filed with the 
  3.33  secretary of state under chapter 317A and must be consistent 
  3.34  with this section. 
  3.35     Subd. 8.  [AUDIT.] Market Champ, Inc. shall contract with a 
  3.36  certified public accounting firm to perform a financial and 
  4.1   compliance audit of the corporation in accordance with generally 
  4.2   accepted accounting standards. 
  4.3      Subd. 9.  [REPORT.] The board of directors of Market Champ, 
  4.4   Inc. shall submit an annual report on the activities of Market 
  4.5   Champ, Inc. by January 15 of each year to the appropriations, 
  4.6   finance, and agriculture committees of the legislature and to 
  4.7   the governor.  The report must include a description of the 
  4.8   corporation's activities for the past year, a list of all 
  4.9   contracts entered into by the corporation, and a financial 
  4.10  report of revenues and expenditures of the corporation. 
  4.11     Sec. 2.  Minnesota Statutes 1996, section 116.07, is 
  4.12  amended by adding a subdivision to read: 
  4.13     Subd. 7b.  [SMALL FEEDLOT UPGRADE COST-SHARE PROGRAM.] (a) 
  4.14  For the purpose of this section, "eligible small feedlot 
  4.15  facility" means a feedlot located in a county delegated under 
  4.16  subdivision 7 that contains no more than 750 animal units. 
  4.17     (b) A county delegated under subdivision 7 may provide a 
  4.18  cost-share grant to an eligible small feedlot facility for 70 
  4.19  percent of the costs to upgrade the facility to meet the feedlot 
  4.20  permit standards up to a maximum of $35,000 per facility. 
  4.21     (c) A county may not make a cost-share grant under this 
  4.22  subdivision unless all of the following conditions are met: 
  4.23     (1) the upgrade is necessary to meet agency or county 
  4.24  feedlot standards; 
  4.25     (2) the upgrade is designed to meet agency or county 
  4.26  feedlot standards; 
  4.27     (3) the upgrade is the most cost-effective method to meet 
  4.28  agency or county standards; and 
  4.29     (4) the cost-share grant, combined with all other sources 
  4.30  of governmental financing, does not exceed 70 percent of the 
  4.31  cost of the upgrade. 
  4.32     (d) To receive a cost-share grant under this subdivision, a 
  4.33  feedlot owner or operator must agree to: 
  4.34     (1) maintain the upgrade for the normal expected life of 
  4.35  the feedlot, replace it with an equally effective practice, or 
  4.36  repay the cost-share grant; and 
  5.1      (2) conduct all activities in accordance with state laws, 
  5.2   rules, and county feedlot standards. 
  5.3      (e) In awarding cost-share grants under this subdivision, 
  5.4   counties delegated under subdivision 7 must give priority to an 
  5.5   owner of a feedlot that has been in existence for at least three 
  5.6   years and for which the upgrade is necessary to receive an 
  5.7   initial feedlot permit from the agency or the county. 
  5.8      (f) Ineligible costs to include in the cost-share grant are:
  5.9      (1) costs to construct or modify a building; 
  5.10     (2) costs of equipment to apply manure to land; 
  5.11     (3) costs of upgrades for which there is a less costly 
  5.12  alternative to meet agency or county feedlot permit standards; 
  5.13     (4) costs related to changes in livestock numbers that 
  5.14  occurred within three years prior to the cost-share grant 
  5.15  application date; and 
  5.16     (5) costs related to anticipated changes in livestock 
  5.17  numbers at the facility. 
  5.18     Sec. 3.  Minnesota Statutes 1996, section 116.07, is 
  5.19  amended by adding a subdivision to read: 
  5.20     Subd. 7c.  [PERMIT LIMITATION.] Neither the pollution 
  5.21  control agency nor any county may grant a permit to increase the 
  5.22  capacity of or establish a feedlot beyond 1,875 swine over 55 
  5.23  pounds, 15,000 swine under 55 pounds, 41,633 turkeys, 1,500 
  5.24  calves under 500 pounds, 533 dairy cows, 750 feeder cattle, or 
  5.25  any other type of livestock or poultry above 750 animal units 
  5.26  unless the permit is based upon an environmental assessment 
  5.27  worksheet prepared under section 116D.04.  For a feedlot 
  5.28  containing beef cattle or dairy cattle, the animal unit capacity 
  5.29  under this subdivision must be calculated with regard only to 
  5.30  the population of mature bovine animals and must disregard 
  5.31  animals that are (1) replacement stock, or (2) steers, or 
  5.32  slaughter heifers under the weight of 800 pounds. 
  5.33     Sec. 4.  Minnesota Statutes 1996, section 116.07, is 
  5.34  amended by adding a subdivision to read: 
  5.35     Subd. 7d.  [STORAGE FACILITIES.] No open air below ground 
  5.36  earthen or clay-lined manure storage facility may be constructed 
  6.1   in the state after July 1, 1998.  This subdivision does not 
  6.2   apply to a storage structure that is part of a dairy or beef 
  6.3   feedlot operation. 
  6.4      Sec. 5.  [LIVESTOCK INDUSTRY ENVIRONMENTAL STEERING 
  6.5   COMMITTEE.] 
  6.6      Subdivision 1.  [COMMITTEE.] The livestock industry 
  6.7   environmental steering committee consists of the following 
  6.8   members: 
  6.9      (1) one member appointed by the president of the Minnesota 
  6.10  Farmers Union; 
  6.11     (2) one member appointed by the president of the Minnesota 
  6.12  Farm Bureau; 
  6.13     (3) one member appointed by the president of the land 
  6.14  stewardship project; 
  6.15     (4) one member appointed by the president of Clean Water 
  6.16  Action; 
  6.17     (5) one member of the house of representatives appointed by 
  6.18  the speaker; 
  6.19     (6) one member of the house of representatives appointed by 
  6.20  the minority leader; 
  6.21     (7) one member of the senate appointed by the majority 
  6.22  leader; and 
  6.23     (8) one member of the senate appointed by the minority 
  6.24  leader. 
  6.25     Compensation of nonlegislator members and reimbursement of 
  6.26  their expenses is governed by Minnesota Statutes, section 
  6.27  15.059.  The committee expires upon completion of the generic 
  6.28  environmental impact statement required in subdivision 2 and 
  6.29  presentation of the final report to the legislature. 
  6.30     Staff support and technical assistance must be provided to 
  6.31  the committee by any state agency upon the request of the 
  6.32  committee.  The committee may contract with consultants and 
  6.33  other entities to assist in the preparation of the generic 
  6.34  environmental impact statement. 
  6.35     Subd. 2.  [GENERIC ENVIRONMENTAL IMPACT STATEMENT.] A 
  6.36  generic environmental impact statement must be prepared under 
  7.1   the direction of the environmental quality board to examine the 
  7.2   long-term effects of the livestock industry as it exists and as 
  7.3   it is changing on the economy, environment, and way of life of 
  7.4   Minnesota and its citizens.  At a minimum, the study must 
  7.5   address: 
  7.6      (1) the overall dimensions of animal agriculture in 
  7.7   Minnesota, including species of livestock; an inventory of 
  7.8   numbers, types, and locations of facilities; and the related 
  7.9   support networks and economic activity involved in the life 
  7.10  cycles of livestock; 
  7.11     (2) environmental issues associated with livestock 
  7.12  production from growing feed to raising the animals to their 
  7.13  shipment to their processing and sale to consumer; effects on 
  7.14  air, groundwater, surface water, land, and other aspects of the 
  7.15  environment both within and without the state examined and 
  7.16  correlated to various management practices, facilities, and 
  7.17  other variables affecting the environment; 
  7.18     (3) economic issues such as the various financial and 
  7.19  ownership arrangements currently or potentially used in the 
  7.20  industries, patterns of vertical integration, size, long-term 
  7.21  sustainability of various forms of ownership and production 
  7.22  methods, access to markets, current and anticipated financial 
  7.23  trends, effects of governmental policies, and comparative 
  7.24  economic impact of alternative means of production; and 
  7.25     (4) the roles of various units of government in regulation 
  7.26  of various aspects of feedlot operation including federal, 
  7.27  state, interstate bodies, counties, townships, soil conservation 
  7.28  districts, watershed districts, and others with planning, 
  7.29  zoning, or environmental responsibilities. 
  7.30     Sec. 6.  [APPROPRIATION.] 
  7.31     (a) $1,200,000 for fiscal years 1998 and 1999 and 
  7.32  $1,500,000 for fiscal years 2000 and 2001 is appropriated from 
  7.33  the general fund to the department of administration for 
  7.34  distribution to the environmental quality board and the 
  7.35  livestock industry environmental steering committee for the 
  7.36  purposes of section 5.  This appropriation does not cancel but 
  8.1   remains available until a generic environmental impact statement 
  8.2   is completed.  
  8.3      (b) $6,000,000 is appropriated from the general fund to the 
  8.4   commissioner of agriculture for feedlot upgrade loans under the 
  8.5   agricultural best management practices loan program in Minnesota 
  8.6   Statutes, section 17.117.  This appropriation is available until 
  8.7   June 30, 1999. 
  8.8      Sec. 7.  [APPROPRIATION.] 
  8.9      $15,000,000 is appropriated from the general fund to the 
  8.10  pollution control agency for grants to delegated counties for 
  8.11  administration of a county cost-share grant program under 
  8.12  section 2.  This appropriation is available until June 30, 1999. 
  8.13     Sec. 8.  [EFFECTIVE DATE.] 
  8.14     Sections 3, 5, and 6 are effective the day following final 
  8.15  enactment.  Section 3 expires on June 30 of the first year 
  8.16  following submission of a completed generic environmental impact 
  8.17  statement to the legislature.