HF 3693

Introduction - 94th Legislature (2025 - 2026)

Posted on 03/23/2026 06:24 p.m.

A bill for an act
relating to agriculture; modifying a previous appropriation; amending Laws 2025,
chapter 34, article 1, section 2, subdivisions 1, 3, as amended.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Laws 2025, chapter 34, article 1, section 2, subdivision 1, is amended to read:

Subdivision 1. Total Appropriation

$

58,957,000

$

deleted text begin 56,052,000 deleted text end new text begin 56,552,000 new text end

Appropriations by Fund
	2026	2027
General	58,558,000	deleted text begin 55,653,000 deleted text end new text begin 56,153,000 new text end
Remediation	399,000	399,000

The amounts that may be spent for each
purpose are specified in the following
subdivisions. Notwithstanding Minnesota
Statutes, section 16B.98, subdivision 14,
unless otherwise specified in this section, the
commissioner of agriculture may use up to 7.5
percent of money appropriated for costs
incurred to administer the Department of
Agriculture's grant and financial assistance
programs.

Sec. 2.

Laws 2025, chapter 34, article 1, section 2, subdivision 3, as amended by Laws
2025, First Special Session chapter 11, section 11, is amended to read:

Subd. 3. Agricultural Marketing and Development

23,551,000

deleted text begin 23,301,000 deleted text end new text begin 23,801,000 new text end

(a) $634,000 the first year and $634,000 the
second year are for the continuation of the
dairy development and profitability
enhancement program, including dairy
profitability teams and dairy business planning
grants under Minnesota Statutes, section
32D.30.

(b) The commissioner may use funds
appropriated in this subdivision for annual
cost-share payments to resident farmers or
entities that sell, process, or package
agricultural products in this state for the costs
of organic certification. The commissioner
may allocate these funds for assistance to
persons transitioning from conventional to
organic agriculture.

(c) $100,000 the first year and $100,000 the
second year are for mental health outreach and
support to farmers, ranchers, farm workers
and employees, and others in the agricultural
community and profession and for farm and
farm worker safety grant and outreach
programs under Minnesota Statutes, section
17.1195. Mental health outreach and support
may include a 24-hour hotline, stigma
reduction, and education. Notwithstanding
Minnesota Statutes, section 16A.28, any
unencumbered balance does not cancel at the
end of the first year and is available in the
second year. The base for this appropriation
is $50,000 in fiscal year 2028 and each year
thereafter.

(d) $700,000 the first year and deleted text begin $700,000 deleted text end new text begin
$1,200,000 new text end the second year are for the local
food purchasing assistance grant program
under article 3, section 35. Notwithstanding
Minnesota Statutes, section 16A.28, any
unencumbered balance does not cancel at the
end of the first year and is available in the
second year.

(e) $18,257,000 the first year and $18,007,000
the second year are for the agricultural growth,
research, and innovation program under
Minnesota Statutes, section 41A.12. The base
for this appropriation is $17,449,000 in fiscal
year 2028 and each year thereafter.

(f) Except as provided in paragraph (g), the
commissioner may allocate the appropriation
in paragraph (e) each year among the
following areas: facilitating the startup,
modernization, improvement, or expansion of
livestock operations, including beginning and
transitioning livestock operations with
preference given to robotic dairy-milking
equipment; assisting value-added agricultural
businesses to begin or expand, to access new
markets, or to diversify, including aquaponics
systems, with preference given to hemp fiber
processing equipment; facilitating the startup,
modernization, or expansion of other
beginning and transitioning farms, including
by providing loans under Minnesota Statutes,
section 41B.056; sustainable agriculture
on-farm research and demonstration; the
development or expansion of food hubs and
other alternative community-based food
distribution systems; enhancing renewable
energy infrastructure and use; crop research,
including basic and applied turf seed research;
Farm Business Management tuition assistance;
supporting the commercialization of an
innovative material additive utilizing
agricultural coproducts or waste streams to
produce fiber-based barrier packaging to
reduce perfluoroalkyl and polyfluoroalkyl
substances (PFAS) and plastics in packaging
products; and good agricultural practices and
good handling practices certification
assistance. Notwithstanding Minnesota
Statutes, section 16B.98, subdivision 14, the
commissioner may use up to 7.5 percent of
the appropriation in paragraph (e) for costs
incurred to administer the program.

(g) Of the amount appropriated for the
agricultural growth, research, and innovation
program under Minnesota Statutes, section
41A.12:

(1) $1,000,000 the first year and $1,000,000
the second year are for distribution in equal
amounts to each of the state's county fairs to
preserve and promote Minnesota agriculture;

(2) $3,000,000 the first year and $3,000,000
the second year are for incentive payments
under Minnesota Statutes, sections 41A.16,
41A.17, 41A.18, and 41A.20. If this
appropriation exceeds the total amount for
which all producers are eligible in a fiscal
year, the balance of the appropriation is
available for other purposes under this
paragraph;

(3) $2,750,000 the first year and $2,750,000
the second year are for grants that enable retail
petroleum dispensers, fuel storage tanks, and
other equipment to dispense biofuels to the
public in accordance with the biofuel
replacement goals established under
Minnesota Statutes, section 239.7911. A retail
petroleum dispenser selling petroleum for use
in spark ignition engines for vehicle model
years after 2000 is eligible for grant money
under this clause if the retail petroleum
dispenser has no more than 20 retail petroleum
dispensing sites and each site is located in
Minnesota. The grant money must be used to
replace or upgrade equipment that does not
have the ability to be certified for E25. A grant
award must not exceed 65 percent of the cost
of the appropriate technology. A grant award
must not exceed $200,000 per station. The
commissioner must cooperate with biofuel
stakeholders in the implementation of the grant
program. The commissioner, in cooperation
with any economic or community development
financial institution and any other entity with
which the commissioner contracts, must
submit a report on the biofuels infrastructure
financial assistance program by January 15
each year to the chairs and ranking minority
members of the legislative committees and
divisions with jurisdiction over agriculture
policy and finance. The annual report must
include but not be limited to a summary of the
following metrics: (i) the number and types
of projects financed; (ii) the amount of dollars
leveraged or matched per project; (iii) the
geographic distribution of financed projects;
(iv) any market expansion associated with
upgraded infrastructure; (v) the demographics
of the areas served; (vi) the costs of the
program; and (vii) the number of grants to
minority-owned or female-owned businesses;

(4) $350,000 the first year and $250,000 the
second year are for grants to facilitate the
startup, modernization, or expansion of meat,
poultry, egg, and milk processing facilities. A
grant award under this clause must not exceed
$200,000;

(5) $1,594,000 the first year and $1,544,000
the second year are for providing more fruits,
vegetables, meat, poultry, grain, and dairy for
children in school and early childhood
education settings, including, at the
commissioner's discretion, providing grants
to reimburse schools and early childhood
education and child care providers for
purchasing equipment and agricultural
products. Of the amount appropriated,
$150,000 each year is for a statewide
coordinator of farm-to-institution strategy and
programming. The coordinator must consult
with relevant stakeholders and provide
technical assistance and training for
participating farmers and eligible grant
recipients. The base for this appropriation is
$1,636,000 in fiscal year 2028 and each year
thereafter. At the commissioner's discretion,
for state administration of federal cooperative
agreements for purchasing Minnesota grown
and raised foods for schools, child care
providers, food banks, and other institutions,
the commissioner may use an amount of state
funds equal to no more than 7.5 percent of the
total federal funds awarded to the state. The
commissioner shall expend any available
federal administrative funds awarded for this
purpose before using state funds;

(6) up to $1,750,000 the first year and up to
$1,750,000 the second year are for grants to
facilitate the development of urban agriculture,
including projects related to youth education,
community and economic development,
value-added processing, and vocational
training;

(7) $1,000,000 the first year and $1,000,000
the second year are for the food retail
improvement and development program under
Minnesota Statutes, section 17.1017;

(8) up to $200,000 the first year and up to
$200,000 the second year are for cooperative
development grants under Minnesota Statutes,
section 17.1016;

(9) $250,000 the first year and $150,000 the
second year are for the protecting livestock
grant program for producers to support the
installation of measures to prevent the
transmission of avian influenza. For the
appropriation in this clause, a grant applicant
must document a cost-share of 20 percent. An
applicant's cost-share amount may be reduced
up to $2,000 to cover time and labor costs.
This is a onetime appropriation; and

(10) up to $525,000 the first year and up to
$525,000 the second year are to award AGRI
Works grants to institutions and organizations
to provide regional and statewide services.
Preference shall be given to legislatively
created entities and organizations that enhance
agricultural, horticultural, or rural community
and economic development, marketing, and
promotion, and research and education. A
grant award under this clause must not exceed
$200,000. Grants made under this paragraph
are subject to the requirements in Minnesota
Statutes, sections 16B.98 and 16B.981. This
is a onetime appropriation.

(h) Notwithstanding Minnesota Statutes,
section 16A.28, the appropriation in paragraph
(e) does not cancel at the end of the second
year and is available until June 30, 2029.
Appropriations encumbered under contract on
or before June 30, 2029, for agricultural
growth, research, and innovation grants are
available until June 30, 2032. At the end of
fiscal year 2027, the commissioner must
prioritize any money resulting from canceled
contracts to be used for AGRI Works grants
under paragraph (g), clause (10).