1.1                          A bill for an act 
  1.2             relating to agriculture; authorizing certain 
  1.3             contracts; changing provisions relating to grants and 
  1.4             contracts; amending Minnesota Statutes 1996, sections 
  1.5             17.03, by adding a subdivision; 17.101; and 17.116, 
  1.6             subdivisions 2 and 3. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1996, section 17.03, is 
  1.9   amended by adding a subdivision to read: 
  1.10     Subd. 12.  [CONTRACTS.] The commissioner may enter into 
  1.11  contracts with any public or private entity for the provision of 
  1.12  statutorily prescribed agricultural services by the department.  
  1.13  A contract must specify the services to be provided and the 
  1.14  amount and method of reimbursement.  Funds generated in a 
  1.15  contractual agreement under this section must be deposited in a 
  1.16  special revenue fund and are appropriated to the department for 
  1.17  purposes of providing services specified in the contracts.  
  1.18  Contracts under this section must be processed in accordance 
  1.19  with section 16B.06.  The commissioner shall report revenues 
  1.20  collected and expenditures made under this section to the chairs 
  1.21  of the committees on appropriations in the house and finance in 
  1.22  the senate by January 1 of each odd-numbered year. 
  1.23     Sec. 2.  Minnesota Statutes 1996, section 17.101, is 
  1.24  amended to read: 
  1.25     17.101 [PROMOTIONAL ACTIVITIES.] 
  1.26     Subdivision 1.  [DEPARTMENTAL DUTIES.] For the purposes of 
  2.1   expanding, improving, and developing the markets for production 
  2.2   and marketing of products of Minnesota agriculture, the 
  2.3   commissioner shall encourage and promote the production and 
  2.4   marketing of these products by means of:  
  2.5      (a) advertising Minnesota agricultural products; 
  2.6      (b) assisting state agricultural commodity organizations; 
  2.7      (c) developing methods to increase processing and marketing 
  2.8   of agricultural commodities including commodities not being 
  2.9   produced in Minnesota on a commercial scale, but which may have 
  2.10  economic potential in national and international markets; 
  2.11     (d) investigating and identifying new marketing technology 
  2.12  and methods to enhance the competitive position of Minnesota 
  2.13  agricultural products; 
  2.14     (e) evaluating livestock marketing opportunities; 
  2.15     (f) assessing and developing national and international 
  2.16  markets for Minnesota agricultural products; 
  2.17     (g) studying the conversion of raw agricultural products to 
  2.18  manufactured products including ethanol; 
  2.19     (h) hosting the visits of foreign trade teams to Minnesota 
  2.20  and defraying the teams' expenses; 
  2.21     (i) assisting Minnesota agricultural businesses desiring to 
  2.22  sell their products; and 
  2.23     (j) conducting research to eliminate or reduce specific 
  2.24  production or technological barriers to market development and 
  2.25  trade; and 
  2.26     (k) other activities the commissioner deems appropriate to 
  2.27  promote Minnesota agricultural products, provided that the 
  2.28  activities do not duplicate programs or services provided by the 
  2.29  Minnesota trade division or the Minnesota world trade center 
  2.30  corporation. 
  2.31     Subd. 2.  [AGRICULTURAL DEVELOPMENT GRANTS AND CONTRACTS.] 
  2.32  In order to carry out the duties in subdivision 1, the 
  2.33  commissioner, in addition to whatever other resources the 
  2.34  department may commit, shall make grants and enter into 
  2.35  contracts to fulfill the obligations of subdivision 1.  The 
  2.36  commissioner may enter into partnerships or seek gifts to carry 
  3.1   out subdivision 1.  The commissioner may contract with, among 
  3.2   others, agricultural commodity organizations, the University of 
  3.3   Minnesota, and agriculture related businesses to fulfill the 
  3.4   duties.  The commissioner shall make permanent rules for the 
  3.5   administration of these grants and contracts.  The rules shall 
  3.6   specify at a minimum:  
  3.7      (a) eligibility criteria; 
  3.8      (b) application procedures; 
  3.9      (c) provisions for application review and project approval; 
  3.10     (d) provisions for program monitoring and review for all 
  3.11  approved grants and contracts; and 
  3.12     (e) other provisions the commissioner finds necessary.  
  3.13     Contracts entered into by the commissioner pursuant to this 
  3.14  subdivision shall not exceed 75 percent of the cost of the 
  3.15  project supported by the commissioner's grant.  In any biennium, 
  3.16  no organization shall receive more than $70,000 $100,000 in 
  3.17  grants from the commissioner.  
  3.18     Subd. 3.  [AUDITS.] The books, records, documents, and 
  3.19  accounting procedures and practices of any organization 
  3.20  receiving a grant or contract from the commissioner under the 
  3.21  provisions of subdivision 2 shall be subject to examination by 
  3.22  the department.  The commissioner may prescribe uniform methods 
  3.23  of accounting to be used by grant or contract recipients.  
  3.24     Subd. 4.  [ADVISORY GROUP.] The commissioner may establish 
  3.25  an ad hoc advisory group to assist in evaluating grant requests 
  3.26  made pursuant to under subdivision 2. 
  3.27     Sec. 3.  Minnesota Statutes 1996, section 17.116, 
  3.28  subdivision 2, is amended to read: 
  3.29     Subd. 2.  [ELIGIBILITY.] (a) Grants may only be made to 
  3.30  farmers, educational institutions, individuals at educational 
  3.31  institutions, or nonprofit organizations residing or located in 
  3.32  the state for demonstrations on farms in the state. 
  3.33     (b) Grants may only be made for projects that show: 
  3.34     (1) the ability to maximize direct or indirect energy 
  3.35  savings or production; 
  3.36     (2) a positive effect or reduced adverse effect on the 
  4.1   environment; and 
  4.2      (3) profitability for the individual farm. 
  4.3      Sec. 4.  Minnesota Statutes 1996, section 17.116, 
  4.4   subdivision 3, is amended to read: 
  4.5      Subd. 3.  [AWARDING OF GRANTS.] (a) Applications for grants 
  4.6   must be made to the commissioner on forms prescribed by the 
  4.7   commissioner. 
  4.8      (b) The applications must be reviewed, ranked, and 
  4.9   recommended by a technical review panel appointed by the 
  4.10  commissioner.  The technical review panel shall consist of a 
  4.11  soil scientist, an agronomist, a representative from a 
  4.12  post-secondary educational institution, two resident farmers of 
  4.13  the state using sustainable agriculture methods, and a chair 
  4.14  from the department.  
  4.15     (c) The technical review panel shall rank applications 
  4.16  according to the following criteria: 
  4.17     (1) direct or indirect energy savings or production; 
  4.18     (2) environmental benefit; 
  4.19     (3) farm profitability; 
  4.20     (4) the number of farms able to apply the techniques or the 
  4.21  technology proposed; 
  4.22     (5) the effectiveness of the project as a demonstration; 
  4.23     (6) the immediate transferability of the project to farms; 
  4.24  and 
  4.25     (7) the ability of the project to accomplish its goals. 
  4.26     (d) The commissioner shall consider the recommendations of 
  4.27  the technical review panel and may award grants for eligible 
  4.28  projects.  Priority must be given to applicants who are farmers 
  4.29  or groups of farmers. 
  4.30     (e) Grants for eligible projects may not exceed $25,000 
  4.31  unless the portion above $25,000 is matched on an equal basis by 
  4.32  the applicant's cash or in-kind land use contribution.  Grant 
  4.33  funding of projects may not exceed $50,000 under this section, 
  4.34  but applicants may utilize other funding sources.  A portion of 
  4.35  each grant must be targeted for public information activities of 
  4.36  the project. 
  5.1      (f) A project may continue for up to three years.  
  5.2   Multiyear projects must be reevaluated by the technical review 
  5.3   panel and the commissioner before second or third year funding 
  5.4   is approved.  A project is limited to one grant for its funding. 
  5.5      (g) Only one grant under this section may be made per 
  5.6   grantee.