1.1 	A bill for an act
1.2 	relating to agriculture; establishing a statutory
1.3 	appropriation for value-added agricultural projects;
1.4 	creating an agricultural farm to market account;
1.5 	providing for the construction, reconstruction, or
1.6 	maintenance of town roads serving the needs of
1.7 	livestock operations; amending Minnesota Statutes
1.8 	2004, sections 17.101, by adding a subdivision;
1.9 	41A.09, subdivision 3a.
1.10 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.11 	Section 1. Minnesota Statutes 2004, section 17.101, is
1.12 	amended by adding a subdivision to read:
1.13 		Subd. 7.Agricultural farm to market account. (a) An
1.14 	agricultural farm to market account is established as an account
1.15 	in the agricultural fund.  Money in the account is annually
1.16 	appropriated to the commissioner of agriculture for expenditure
1.17 	as specified in this subdivision.  Money in the account must be
1.18 	used as grants or loans to towns to assist in paying the costs
1.19 	of constructing, reconstructing, or rehabilitating town roads
1.20 	that have not been fully funded through other state, federal, or
1.21 	local funding sources.  The commissioner shall establish
1.22 	procedures for towns to apply for grants or loans from the
1.23 	account and criteria to be used to select projects for funding.
1.24 	Priority for grants or loans from this account must be given to
1.25 	town road projects that will help meet the specific
1.26 	transportation needs and issues of livestock operations.
1.27 	(b) The sum of 0.25 percent of the amount in the account is
2.1 	available to be used for administrative costs incurred by the
2.2 	department in carrying out the provisions of this subdivision.

2.3 	Sec. 2. Minnesota Statutes 2004, section 41A.09,
2.4 	subdivision 3a, is amended to read:
2.5 		Subd. 3a.Ethanol producer payments; rural infrastructure
2.6 	investments.  (a) The commissioner shall make cash payments to
2.7 	producers of ethanol located in the state that have begun
2.8 	production by June 30, 2000. For the purpose of this
2.9 	subdivision, an entity that holds a controlling interest in more
2.10 	than one ethanol plant is considered a single producer.  The
2.11 	amount of the payment for each producer's annual production,
2.12 	except as provided in paragraph (c), is 20 cents per gallon for
2.13 	each gallon of ethanol produced on or before June 30, 2000, or
2.14 	ten years after the start of production, whichever is later.
2.15 	Annually, within 90 days of the end of its fiscal year, an
2.16 	ethanol producer receiving payments under this subdivision must
2.17 	file a disclosure statement on a form provided by the
2.18 	commissioner.  The initial disclosure statement must include a
2.19 	summary description of the organization of the business
2.20 	structure of the claimant, a listing of the percentages of
2.21 	ownership by any person or other entity with an ownership
2.22 	interest of five percent or greater, and a copy of its annual
2.23 	audited financial statements, including the auditor's report and
2.24 	footnotes.  The disclosure statement must include information
2.25 	demonstrating what percentage of the entity receiving payments
2.26 	under this section is owned by farmers or other entities
2.27 	eligible to farm or own agricultural land in Minnesota under the
2.28 	provisions of section 500.24.  Subsequent annual reports must
2.29 	reflect noncumulative changes in ownership of ten percent or
2.30 	more of the entity.  The report need not disclose the identity
2.31 	of the persons or entities eligible to farm or own agricultural
2.32 	land with ownership interests, individuals residing within 30
2.33 	miles of the plant, or of any other entity with less than ten
2.34 	percent ownership interest, but the claimant must retain
2.35 	information within its files confirming the accuracy of the data
2.36 	provided.  This data must be made available to the commissioner
3.1 	upon request.  Not later than the 15th day of February in each
3.2 	year the commissioner shall deliver to the chairs of the
3.3 	standing committees of the senate and the house of
3.4 	representatives that deal with agricultural policy and
3.5 	agricultural finance issues an annual report summarizing
3.6 	aggregated data from plants receiving payments under this
3.7 	section during the preceding calendar year.  Audited financial
3.8 	statements and notes and disclosure statements submitted to the
3.9 	commissioner are nonpublic data under section 13.02, subdivision
3.10 	9.  Notwithstanding the provisions of chapter 13 relating to
3.11 	nonpublic data, summaries of the submitted audited financial
3.12 	reports and notes and disclosure statements will be contained in
3.13 	the report to the committee chairs and will be public data.
3.14 	(b) No payments shall be made for ethanol production that
3.15 	occurs after June 30, 2010.
3.16 	(c) If the level of production at an ethanol plant
3.17 	increases due to an increase in the production capacity of the
3.18 	plant, the payment under paragraph (a) applies to the additional
3.19 	increment of production until ten years after the increased
3.20 	production began.  Once a plant's production capacity reaches
3.21 	15,000,000 gallons per year, no additional increment will
3.22 	qualify for the payment.
3.23 	(d) Total payments under paragraphs (a) and (c) to a
3.24 	producer in a fiscal year may not exceed $3,000,000.
3.25 	(e) By the last day of October, January, April, and July,
3.26 	each producer shall file a claim for payment for ethanol
3.27 	production during the preceding three calendar months.  A
3.28 	producer that files a claim under this subdivision shall include
3.29 	a statement of the producer's total ethanol production in
3.30 	Minnesota during the quarter covered by the claim.  For each
3.31 	claim and statement of total ethanol production filed under this
3.32 	subdivision, the volume of ethanol production must be examined
3.33 	by an independent certified public accountant in accordance with
3.34 	standards established by the American Institute of Certified
3.35 	Public Accountants.
3.36 	(f) Payments shall be made November 15, February 15, May
4.1 	15, and August 15.  A separate payment shall be made for each
4.2 	claim filed.  Except as provided in paragraph (g), the total
4.3 	quarterly payment to a producer under this paragraph may not
4.4 	exceed $750,000.
4.5 	(g) Notwithstanding the quarterly payment limits of
4.6 	paragraph (f), the commissioner shall make an additional payment
4.7 	in the fourth quarter of each fiscal year to ethanol producers
4.8 	for the lesser of:  (1) 20 cents per gallon of production in the
4.9 	fourth quarter of the year that is greater than 3,750,000
4.10 	gallons; or (2) the total amount of payments lost during the
4.11 	first three quarters of the fiscal year due to plant outages,
4.12 	repair, or major maintenance.  Total payments to an ethanol
4.13 	producer in a fiscal year, including any payment under this
4.14 	paragraph, must not exceed the total amount the producer is
4.15 	eligible to receive based on the producer's approved production
4.16 	capacity.  The provisions of this paragraph apply only to
4.17 	production losses that occur in quarters beginning after
4.18 	December 31, 1999.
4.19 	(h) The commissioner shall reimburse ethanol producers for
4.20 	any deficiency in payments during earlier quarters if the
4.21 	deficiency occurred because of unallotment or because 
4.22 	appropriated money was insufficient to make timely payments in
4.23 	the full amount provided in paragraph (a).  Notwithstanding the
4.24 	quarterly or annual payment limitations in this subdivision, the
4.25 	commissioner shall begin making payments for earlier
4.26 	deficiencies in each fiscal year that appropriations for ethanol
4.27 	payments exceed the amount required to make eligible scheduled
4.28 	payments.  Payments for earlier deficiencies must continue until
4.29 	the deficiencies for each producer are paid in full.
4.30 	(i) If in any year the appropriation for value-added
4.31 	agricultural products under this section is in excess of the
4.32 	amount required to make scheduled ethanol producer payments and
4.33 	deficiency payments for payments delayed because of unallotment
4.34 	or because appropriated funds in earlier fiscal years were
4.35 	insufficient, the commissioner shall deposit the remaining
4.36 	balance in the agricultural farm to market account in the
5.1 	agricultural fund created under section 17.101, subdivision 7.
5.2 	(j) For fiscal years 2006 and thereafter, the dollar amount
5.3 	of the appropriation for value-added agricultural products in
5.4 	fiscal year 2005, under Laws 2003, chapter 128, article 3,
5.5 	section 2, subdivision 4, is annually appropriated from the
5.6 	general fund to the commissioner of agriculture for purposes of
5.7 	ethanol producer payments and for deposit in the agricultural
5.8 	farm to market account as provided in paragraph (i).