SF 1955

1st Engrossment - 93rd Legislature (2023 - 2024) Posted on 04/12/2023 11:25am

A bill for an act
relating to state government; establishing a budget for the Department of
Agriculture, the Board of Animal Health, the Agricultural Utilization Research
Institute, and the Office of Broadband Development; making policy and technical
changes to agriculture provisions; making policy and technical changes to
broadband provisions; providing civil penalties; appropriating money; requiring
reports; transferring money to the border-to-border broadband fund account;
creating the grain indemnity account; transferring money to the grain indemnity
account; amending Minnesota Statutes 2022, sections 17.1016, subdivision 2;
17.133, subdivision 2; 41A.14, subdivision 2; 41A.19; 116J.395, subdivision 7;
116J.396, subdivision 2; 223.16, by adding a subdivision; 223.17, subdivisions 6,
7, 7a; 223.175; 223.19; 232.22, subdivision 5; Laws 2021, First Special Session
chapter 3, article 1, section 2, subdivision 5, as amended; Laws 2022, chapter 95,
article 2, section 29, subdivision 6; proposing coding for new law in Minnesota
Statutes, chapters 17; 116J; 223; repealing Minnesota Statutes 2022, sections
17.055, subdivision 2; 41A.12, subdivision 4; 41A.21; 223.17, subdivisions 4, 8;
232.22, subdivisions 4, 6, 6a, 7.

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

ARTICLE 1

APPROPRIATIONS

Section 1. new text begin AGRICULTURE APPROPRIATIONS. new text end

new text begin The sums shown in the columns marked "Appropriations" are appropriated to the agencies
and for the purposes specified in this article. The appropriations are from the general fund,
or another named fund, and are available for the fiscal years indicated for each purpose.
The figures "2024" and "2025" used in this article mean that the appropriations listed under
them are available for the fiscal year ending June 30, 2024, or June 30, 2025, respectively.
"The first year" is fiscal year 2024. "The second year" is fiscal year 2025. "The biennium"
is fiscal years 2024 and 2025.
new text end

			new text begin APPROPRIATIONS new text end
			new text begin Available for the Year new text end
			new text begin Ending June 30 new text end
				new text begin 2024 new text end		new text begin 2025 new text end

Sec. 2. new text begin DEPARTMENT OF AGRICULTURE new text end

new text begin Subdivision 1. new text end new text begin Total Appropriation new text end

new text begin $ new text end

new text begin 96,089,000 new text end

new text begin $ new text end

new text begin 74,253,000 new text end

new text begin Appropriations by Fund new text end
	new text begin 2024 new text end	new text begin 2025 new text end
new text begin General new text end	new text begin 95,690,000 new text end	new text begin 73,854,000 new text end
new text begin Remediation new text end	new text begin 399,000 new text end	new text begin 399,000 new text end

new text begin The amounts that may be spent for each
purpose are specified in the following
subdivisions.
new text end

new text begin Subd. 2. new text end new text begin Protection Services new text end

new text begin Appropriations by Fund new text end
	new text begin 2024 new text end	new text begin 2025 new text end
new text begin General new text end	new text begin 24,400,000 new text end	new text begin 23,350,000 new text end
new text begin Remediation new text end	new text begin 399,000 new text end	new text begin 399,000 new text end

new text begin (a) $399,000 the first year and $399,000 the
second year are from the remediation fund for
administrative funding for the voluntary
cleanup program.
new text end

new text begin (b) $1,000,000 the first year and $1,000,000
the second year are for the soil health financial
assistance program under Minnesota Statutes,
section 17.134. The commissioner may award
no more than $50,000 of the appropriation
each year to a single recipient. This is a
onetime appropriation. Any unencumbered
balance does not cancel at the end of the first
year and is available in the second year.
Appropriations encumbered under contract on
or before June 30, 2025, for soil health
financial assistance grants are available until
June 30, 2027.
new text end

new text begin (c) $375,000 the first year and $375,000 the
second year are for transfer to the noxious
weed and invasive plant species assistance
account in the agricultural fund to award
grants to local units of government and Tribal
Nations under Minnesota Statutes, section
18.90.
new text end

new text begin (d) $215,000 the first year and $215,000 the
second year are for compensation for
destroyed or crippled livestock under
Minnesota Statutes, section 3.737. The first
year appropriation may be spent to compensate
for livestock that were destroyed or crippled
during fiscal year 2023. If the amount in the
first year is insufficient, the amount in the
second year is available in the first year. The
commissioner may use up to $5,000 each year
to reimburse expenses incurred by university
extension educators to provide fair market
values of destroyed or crippled livestock. If
the commissioner receives federal dollars to
pay claims for destroyed or crippled livestock,
an equivalent amount of this appropriation
may be used to reimburse nonlethal prevention
methods performed by federal wildlife services
staff. 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 is
$175,000 for fiscal year 2026 and thereafter.
new text end

new text begin (e) $190,000 the first year and $190,000 the
second year are for compensation for crop
damage under Minnesota Statutes, section
3.7371. If the amount in the first year is
insufficient, the amount in the second year is
available in the first year. The commissioner
may use up to $10,000 of the appropriation
each year to reimburse expenses incurred by
the commissioner or the commissioner's
approved agent to investigate and resolve
claims, as well as for costs associated with
training for approved agents. The
commissioner may use up to $20,000 of the
appropriation each year to make grants to
producers for measures to protect stored crops
from elk damage. If the commissioner
determines that claims made under Minnesota
Statutes, section 3.737 or 3.7371, are
unusually high, amounts appropriated for
either program may be transferred to the
appropriation for the other program.
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 is
$155,000 for fiscal year 2026 and thereafter.
new text end

new text begin (f) $825,000 the first year and $825,000 the
second year are to replace capital equipment
in the Department of Agriculture's analytical
laboratory. The base for fiscal year 2026 and
thereafter is $825,000.
new text end

new text begin (g) $75,000 the first year and $75,000 the
second year are to support a meat processing
liaison position to assist new or existing meat
and poultry processing operations in getting
started, expanding, growing, or transitioning
into new business models.
new text end

new text begin (h) $950,000 the first year and $950,000 the
second year are additional funding to maintain
the current level of service delivery for
programs under this subdivision. The base is
$1,388,000 for fiscal year 2026 and thereafter.
new text end

new text begin (i) $975,000 the first year and $975,000 the
second year are for grants to the Board of
Regents of the University of Minnesota to
fund the Forever Green Initiative and protect
the state's natural resources while increasing
the efficiency, profitability, and productivity
of Minnesota's farmers by incorporating
perennial and winter-annual crops into existing
agricultural practices. By February 1 each
year, the dean of the College of Food,
Agricultural and Natural Resource Sciences
must submit a report to the chairs and ranking
minority members of the legislative
committees with jurisdiction over agriculture
finance and policy and higher education
detailing uses of the funds in this paragraph,
including administrative costs, and the
achievements these funds contributed to.
new text end

new text begin (j) $1,250,000 the first year and $250,000 the
second year are for grants to organizations in
Minnesota to develop enterprises, supply
chains, and markets for continuous-living
cover crops and cropping systems in the early
stages of commercial development. For the
purposes of this paragraph, "continuous-living
cover crops and cropping systems" refers to
agroforestry, perennial biomass, perennial
forage, perennial grains, and winter-annual
cereal grains and oilseeds that have market
value as harvested or grazed commodities. By
February 1 each year, the commissioner must
submit a report to the chairs and ranking
minority members of the legislative
committees with jurisdiction over agriculture
finance and policy detailing uses of the funds
in this paragraph, including administrative
costs, and the achievements these funds
contributed to. Of the amount in the first year,
$1,000,000 must be used to support markets
for Kernza perennial grain, winter camelina,
hybrid hazelnut, and elderberry, and is
available until June 30, 2027. The
commissioner may use up to 6.5 percent of
this appropriation for administrative costs.
new text end

new text begin (k) $225,000 the first year and $225,000 the
second year are appropriated for
wolf-livestock conflict-prevention grants. The
commissioner may use up to $125,000 from
each year to reimburse nonlethal prevention
work performed by federal wildlife services.
This is a onetime appropriation.
new text end

new text begin (l) $50,000 the first year is to convene a
working group of interested parties, including
representatives from the Department of
Natural Resources, to investigate and
recommend measures to protect crops, stored
crops, and forage from destruction due to
white-tailed deer. Membership of the working
group is at the discretion of the commissioner.
The commissioner or the commissioner's
designated representative must convene and
facilitate the working group. No later than
February 1, 2024, the commissioner must
submit a report on the working group's
recommendations to the legislative committees
with jurisdiction over agriculture policy and
finance. This is a onetime appropriation.
new text end

new text begin Subd. 3. new text end new text begin Agricultural Marketing and Development new text end

new text begin 4,815,000 new text end

new text begin 4,815,000 new text end

new text begin (a) $150,000 the first year and $150,000 the
second year are to expand international trade
opportunities and markets for Minnesota
agricultural products.
new text end

new text begin (b) $186,000 the first year and $186,000 the
second year are for transfer to the Minnesota
Grown account and may be used as grants for
Minnesota Grown promotion under Minnesota
Statutes, section 17.102. Notwithstanding
Minnesota Statutes, section 16A.28, the
appropriations encumbered under contract on
or before June 30, 2025, for Minnesota Grown
grants in this paragraph are available until June
30, 2027.
new text end

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

new text begin (d) 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.
new text end

new text begin (e) $450,000 the first year and $450,000 the
second year are to maintain the current level
of service delivery. The base is $550,000 for
fiscal year 2026 and thereafter.
new text end

new text begin (f) $100,000 the first year and $100,000 the
second year are for mental health outreach and
support to farmers, ranchers, and others in the
agricultural community and for farm 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. This is a onetime
appropriation.
new text end

new text begin (g) $100,000 the first year and $100,000 the
second year are to award and administer grants
to facilitate the start-up or expansion of
aggregation and food hub services at farmers
markets. This is a onetime appropriation.
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. This is a onetime
appropriation.
new text end

new text begin Subd. 4. new text end new text begin Agriculture, Bioenergy, and Bioproduct Advancement new text end

new text begin 36,232,000 new text end

new text begin 30,732,000 new text end

new text begin (a) $9,800,000 the first year and $9,800,000
the second year are for transfer to the
agriculture research, education, extension, and
technology transfer account under Minnesota
Statutes, section 41A.14, subdivision 3. Of
these amounts: at least $600,000 the first year
and $600,000 the second year are for the
Minnesota Agricultural Experiment Station's
agriculture rapid response fund under
Minnesota Statutes, section 41A.14,
subdivision 1, clause (2); $2,500,000 the first
year and $2,500,000 the second year are for
grants to the Minnesota Agricultural Education
Leadership Council to enhance agricultural
education with priority given to Farm Business
Management challenge grants; $450,000 the
first year and $450,000 the second year are
for projects, programs, and research associated
with the preservation and production of wild
rice in collaboration with Minnesota Tribal
governments as defined in Minnesota Statutes,
section 10.65, subdivision 2, paragraph (a),
clause (4); and $350,000 the first year and
$350,000 the second year are for potato
breeding. The commissioner shall transfer the
remaining funds in this appropriation each
year to the Board of Regents of the University
of Minnesota for purposes of Minnesota
Statutes, section 41A.14. Of the amount
transferred to the Board of Regents, up to
$1,000,000 each year is for avian influenza
prevention measures and research on avian
influenza, salmonella, and other turkey-related
diseases. Funds may be used for researching
avian influenza prevention measures, including
but not limited to measures to prevent
transmission of avian influenza from wild
birds to domestic turkeys. To the extent
practicable, money expended under Minnesota
Statutes, section 41A.14, subdivision 1,
clauses (1) and (2), must supplement and not
supplant existing sources and levels of
funding. By January 15 each year, the entities
receiving grants under this paragraph are
requested to submit a report on the
expenditures under this paragraph to the chairs
and ranking minority members of the
legislative committees and divisions with
jurisdiction over agriculture policy and
finance. The commissioner may use up to one
percent of this appropriation for costs incurred
to administer the program.
new text end

new text begin (b) $26,432,000 the first year and $20,932,000
the second year are for the agricultural growth,
research, and innovation program under
Minnesota Statutes, section 41A.12. The
commissioner may use up to 6.5 percent of
this appropriation for costs incurred to
administer the program.
new text end

new text begin Of the amount appropriated for the agricultural
growth, research, and innovation program
under Minnesota Statutes, section 41A.12:
new text end

new text begin (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;
new text end

new text begin (2) $6,000,000 the first year and $6,000,000
the second year are for incentive payments
under Minnesota Statutes, sections 41A.16,
41A.17, 41A.18, and 41A.20. Notwithstanding
Minnesota Statutes, section 16A.28, the first
year appropriation is available until June 30,
2025, and the second year appropriation is
available until June 30, 2026. 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. The base under this clause is
$6,125,000 in fiscal year 2026 and thereafter;
new text end

new text begin (3) $4,500,000 the first year and $4,500,000
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 10 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 of
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.
The base under this clause is $3,375,000 for
fiscal year 2026 and thereafter;
new text end

new text begin (4) $1,500,000 the first year and $1,500,000
the second year are for grants to facilitate the
start-up, modernization, or expansion of meat,
poultry, egg, and milk processing facilities. A
grant award under this clause must not exceed
$200,000. Any unencumbered balance at the
end of the second year does not cancel until
June 30, 2026, and may be used for other
purposes under this paragraph. The base under
this clause is $250,000 in fiscal year 2026 and
thereafter;
new text end

new text begin (5) $1,150,000 the first year and $1,150,000
the second year are for providing more fruits,
vegetables, meat, poultry, grain, and dairy for
children in school and early childhood
education centers, including, at the
commissioner's discretion, providing grants
to reimburse schools and early childhood
education centers 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 under this clause is
$800,000 in fiscal year 2026 and thereafter;
new text end

new text begin (6) $5,500,000 the first year is for Dairy
Assistance, Investment, Relief Initiative
(DAIRI) grants to Minnesota dairy farmers
who enroll in coverage under a federal dairy
risk protection program and produced no more
than 25,000,000 pounds of milk in 2022. The
commissioner must award DAIRI grants based
on the amount of milk produced in 2022, up
to 5,000,000 pounds per participating
producer, at a rate determined by the
commissioner within the limits of available
funding. Any unencumbered balance does not
cancel at the end of the first year and is
available in the second year. Any
unencumbered balance at the end of the second
year does not cancel until June 30, 2026, and
may be used for other purposes under this
paragraph. This is a onetime appropriation;
new text end

new text begin (7) $250,000 the first year and $250,000 the
second year are for grants to support hemp
processing. This is a onetime appropriation;
new text end

new text begin (8) up to $600,000 the first year and $600,000
the second year are for urban youth
agricultural education or urban agriculture
community development;
new text end

new text begin (9) up to $450,000 the first year and $450,000
the second year are for the good food access
program under Minnesota Statutes, section
17.1017;
new text end

new text begin (10) $1,500,000 the first year and $1,500,000
the second year are for the livestock
investment grant program under Minnesota
Statutes, section 17.118. Any unencumbered
balance at the end of the second year does not
cancel until June 30, 2026, and may be used
for other purposes under this paragraph;
new text end

new text begin (11) $1,150,000 the first year and $1,150,000
the second year are for value-added grants;
new text end

new text begin (12) $340,000 the first year and $340,000 the
second year are for the New Markets Program;
and
new text end

new text begin (13) $450,000 the first year and $450,000 the
second year are for beginning farmer farm
business management scholarships.
new text end

new text begin By January 15 each year, the commissioner
must submit a report on the grants awarded
under this paragraph to the chairs and ranking
minority members of the legislative
committees and divisions with jurisdiction
over agriculture policy and finance.
Notwithstanding Minnesota Statutes, section
16A.28, any unencumbered balance does not
cancel at the end of the first year and is
available for the second year, and
appropriations encumbered under contract on
or before June 30, 2025, for agricultural
growth, research, and innovation grants are
available until June 30, 2028.
new text end

new text begin The base for the agricultural growth, research,
and innovation program is $17,582,000 in
fiscal year 2026 and thereafter, and includes
funding for incentive payments under
Minnesota Statutes, sections 41A.16, 41A.17,
41A.18, and 41A.20.
new text end

new text begin Subd. 5. new text end new text begin Administration and Financial Assistance new text end

new text begin 30,243,000 new text end

new text begin 14,957,000 new text end

new text begin (a) $474,000 the first year and $474,000 the
second year are for payments to county and
district agricultural societies and associations
under Minnesota Statutes, section 38.02,
subdivision 1. Aid payments to county and
district agricultural societies and associations
must be disbursed no later than July 15 of each
year. These payments are the amount of aid
from the state for an annual fair held in the
previous calendar year.
new text end

new text begin (b) $375,000 the first year and $375,000 the
second year are for grants to the Minnesota
Agricultural Education and Leadership
Council for programs of the council under
Minnesota Statutes, chapter 41D.
new text end

new text begin (c) $2,000 the first year is for a grant to the
Minnesota State Poultry Association. This is
a onetime appropriation. Notwithstanding
Minnesota Statutes, section 16A.28, any
unencumbered balance does not cancel at the
end of the first year and is available for the
second year.
new text end

new text begin (d) $18,000 the first year and $18,000 the
second year are for grants to the Minnesota
Livestock Breeders Association. This is a
onetime appropriation.
new text end

new text begin (e) $60,000 the first year and $60,000 the
second year are for grants to the Northern
Crops Institute to purchase equipment. This
is a onetime appropriation.
new text end

new text begin (f) $34,000 the first year and $34,000 the
second year are for grants to the Minnesota
State Horticultural Society. This is a onetime
appropriation.
new text end

new text begin (g) $75,000 the first year and $75,000 the
second year are appropriated from the general
fund to the commissioner of agriculture for
grants to the Minnesota Turf Seed Council for
basic and applied research on: (1) the
improved production of forage and turf seed
related to new and improved varieties; and (2)
native plants, including plant breeding,
nutrient management, pest management,
disease management, yield, and viability. The
Minnesota Turf Seed Council may subcontract
with a qualified third party for some or all of
the basic or applied research. Any
unencumbered balance does not cancel at the
end of the first year and is available in the
second year. The Minnesota Turf Seed Council
must prepare a report outlining the use of the
grant money and related accomplishments. No
later than January 15, 2025, the council must
submit the report to the chairs and ranking
minority members of the legislative
committees and divisions with jurisdiction
over agriculture finance and policy.
new text end

new text begin (h) $200,000 the first year and $200,000 the
second year are for grants to GreenSeam for
assistance to agriculture-related businesses to
support business retention and development,
business attraction and creation, talent
development and attraction, and regional
branding and promotion. These are onetime
appropriations. No later than December 1,
2024, and December 1, 2025, GreenSeam
must report to the chairs and ranking minority
members of the legislative committees with
jurisdiction over agriculture and rural
development with information on new and
existing businesses supported, number of new
jobs created in the region, new educational
partnerships and programs supported, and
regional branding and promotional efforts.
new text end

new text begin (i) $1,950,000 the first year and $1,950,000
the second year are for grants to Second
Harvest Heartland on behalf of Minnesota's
six Feeding America food banks for the
following purposes:
new text end

new text begin (1) at least $850,000 each year must be
allocated to purchase milk for distribution to
Minnesota's food shelves and other charitable
organizations that are eligible to receive food
from the food banks. Milk purchased under
the grants must be acquired from Minnesota
milk processors and based on low-cost bids.
The milk must be allocated to each Feeding
America food bank serving Minnesota
according to the formula used in the
distribution of United States Department of
Agriculture commodities under The
Emergency Food Assistance Program. Second
Harvest Heartland may enter into contracts or
agreements with food banks for shared funding
or reimbursement of the direct purchase of
milk. Each food bank that receives funding
under this clause may use up to two percent
for administrative expenses. Notwithstanding
Minnesota Statutes, section 16A.28, any
unencumbered balance the first year does not
cancel and is available the second year;
new text end

new text begin (2) to compensate agricultural producers and
processors for costs incurred to harvest and
package for transfer surplus fruits, vegetables,
and other agricultural commodities that would
otherwise go unharvested, be discarded, or be
sold in a secondary market. Surplus
commodities must be distributed statewide to
food shelves and other charitable organizations
that are eligible to receive food from the food
banks. Surplus food acquired under this clause
must be from Minnesota producers and
processors. Second Harvest Heartland may
use up to 15 percent of each grant awarded
under this clause for administrative and
transportation expenses; and
new text end

new text begin (3) to purchase and distribute protein products,
including but not limited to pork, poultry, beef,
dry legumes, cheese, and eggs to Minnesota's
food shelves and other charitable organizations
that are eligible to receive food from the food
banks. Second Harvest Heartland may use up
to two percent of each grant awarded under
this clause for administrative expenses. Protein
products purchased under the grants must be
acquired from Minnesota processors and
producers.
new text end

new text begin Second Harvest Heartland must submit
quarterly reports to the commissioner and the
chairs and ranking minority members of the
legislative committees with jurisdiction over
agriculture finance in the form prescribed by
the commissioner. The reports must include
but are not limited to information on the
expenditure of funds, the amount of milk or
other commodities purchased, and the
organizations to which this food was
distributed. By January 15 each year, the
commissioner must submit a report on the
grants awarded under this paragraph to the
chairs and ranking minority members of the
legislative committees and divisions with
jurisdiction over agriculture policy and
finance. The base is $1,700,000 for fiscal year
2026 and thereafter.
new text end

new text begin (j) $25,000 the first year and $25,000 the
second year are for grants to the Southern
Minnesota Initiative Foundation to promote
local foods through an annual event that raises
public awareness of local foods and connects
local food producers and processors with
potential buyers.
new text end

new text begin (k) $300,000 the first year and $300,000 the
second year are for grants to The Good Acre
for the Local Emergency Assistance Farmer
Fund (LEAFF) program to compensate
emerging farmers for crops donated to hunger
relief organizations in Minnesota. This is a
onetime appropriation.
new text end

new text begin (l) $550,000 the first year and $550,000 the
second year are for services to beginning and
emerging farmers to increase connections
between farmers and market opportunities
throughout the state. This appropriation may
be used for grants, translation services,
training programs, or other purposes in line
with the recommendations of the Emerging
Farmer Working Group established under
Minnesota Statutes, section 17.055,
subdivision 1. By January 15 each year, the
commissioner must submit a report on the
grants awarded under this paragraph to the
chairs and ranking minority members of the
legislative committees and divisions with
jurisdiction over agriculture policy and
finance. The base is $350,000 for fiscal year
2026 and thereafter.
new text end

new text begin (m) $337,000 the first year and $337,000 the
second year are for farm advocate services.
Of these amounts, $50,000 the first year and
$50,000 the second year are for the
continuation of the farmland transition
programs and may be used for grants to
farmland access teams to provide technical
assistance to potential beginning farmers.
Farmland access teams must assist existing
farmers and beginning farmers with
transitioning farm ownership and farm
operation. Services provided by teams may
include but are not limited to mediation
assistance, designing contracts, financial
planning, tax preparation, estate planning, and
housing assistance.
new text end

new text begin (n) $260,000 the first year and $260,000 the
second year are for a pass-through grant to
Region Five Development Commission to
provide, in collaboration with Farm Business
Management, statewide mental health
counseling support to Minnesota farm
operators, families, and employees, and
individuals who work with Minnesota farmers
in a professional capacity. Region Five
Development Commission may use up to 6.5
percent of the grant awarded under this
paragraph for administration.
new text end

new text begin (o) $1,400,000 the first year is for transfer to
the agricultural emergency account established
under Minnesota Statutes, section 17.041. This
is a onetime transfer.
new text end

new text begin (p) $1,084,000 the first year and $1,500,000
the second year are to support IT
modernization efforts, including laying the
technology foundations needed for improving
customer interactions with the department for
licensing and payments. This is a onetime
appropriation.
new text end

new text begin (q) $1,425,000 the first year and $1,425,000
the second year are transferred to the
agricultural and environmental revolving loan
account established under Minnesota Statutes,
section 17.117, subdivision 5a, for low-interest
loans to farmers, rural landowners, and
agricultural businesses through the agriculture
best management practices loan program in
Minnesota Statutes, section 17.117.
new text end

new text begin (r) $150,000 the first year and $150,000 the
second year are for administrative support for
the Rural Finance Authority.
new text end

new text begin (s) $14,000,000 the first year is for transfer to
the grain indemnity account established in
Minnesota Statutes, section 223.24. This is a
onetime transfer.
new text end

new text begin (t) $500,000 the first year and $500,000 the
second year are to maintain the current level
of service delivery. The base is $600,000 in
fiscal year 2026 and thereafter.
new text end

new text begin (u) $250,000 the first year is for a grant to the
Board of Regents of the University of
Minnesota to purchase equipment for the
Veterinary Diagnostic Laboratory to test for
chronic wasting disease, African swine fever,
avian influenza, and other animal diseases.
This is a onetime appropriation.
new text end

new text begin (v) $1,250,000 the first year and $1,250,000
the second year are to award down payment
assistance grants under Minnesota Statutes,
section 17.133. Of the amount appropriated
each year, at least $375,000 is for down
payment assistance grants to emerging
farmers. If the commissioner has not awarded
$375,000 to emerging farmers by March 1
each year, the commissioner may award
remaining funds to any eligible farmer. By
January 15 each year, the commissioner must
submit a report on the grants awarded under
this paragraph to the chairs and ranking
minority members of the legislative
committees and divisions with jurisdiction
over agriculture policy and finance. The base
is $750,000 for fiscal year 2026 and thereafter.
new text end

new text begin (w) $222,000 the first year and $322,000 the
second year are appropriated for grants to meat
and poultry processors to reimburse costs for
training and retention of employees. A meat
processor with 100 full-time equivalent
employees or fewer is eligible for grant money
under this section. Grants may be used for
tuition reimbursement at Minnesota State
Colleges and Universities, child care stipends,
retention bonuses, and other related expenses.
A grant award may not exceed $5,000 per
employee. By January 15 each year, the
commissioner must submit a report on the
grants awarded under this paragraph to the
chairs and ranking minority members of the
legislative committees and divisions with
jurisdiction over agriculture policy and
finance. The commissioner may use up to 6.5
percent of the appropriation each year for
administration. This is a onetime
appropriation.
new text end

new text begin (x) $250,000 the first year and $250,000 the
second year are appropriated from the general
fund to the commissioner of agriculture to
award cooperative grants under Minnesota
Statutes, section 17.1016. The commissioner
may use up to 6.5 percent of the appropriation
each year to administer the grant program.
This is a onetime appropriation.
new text end

new text begin (y) $100,000 the first year is for grants or other
forms of technical assistance to meat and
poultry processors to reimburse the cost of
attending courses or training and receiving
technical assistance in fiscal year 2024 that
supports developing sanitation standard
operating procedures, hazard analysis and
critical control points plans, or business plans.
A meat processor with 50 full-time equivalent
employees or fewer is eligible for grant money
under this section. This is a onetime
appropriation.
new text end

Sec. 3. new text begin BOARD OF ANIMAL HEALTH new text end

new text begin $ new text end

new text begin 6,771,000 new text end

new text begin $ new text end

new text begin 6,931,000 new text end

new text begin (a) $170,000 the first year and $170,000 the
second year are to cover increased costs
associated with importing companion animals
from parts of the world with a high prevalence
of animal diseases.
new text end

new text begin (b) $560,000 the first year and $560,000 the
second year are for agricultural emergency
preparedness and response.
new text end

Sec. 4. new text begin AGRICULTURAL UTILIZATION RESEARCH INSTITUTE new text end

new text begin $ new text end

new text begin 6,643,000 new text end

new text begin $ new text end

new text begin 4,343,000 new text end

new text begin (a) $1,800,000 the first year is for equipment
upgrades, equipment replacement, installation
expenses, and laboratory infrastructure at the
Agricultural Utilization Research Institute's
laboratories in the cities of Crookston,
Marshall, and Waseca. The is a onetime
appropriation and is available until June 30,
2026.
new text end

new text begin (b) $500,000 the first year is for renewable
natural gas and anaerobic digestion projects.
The is a onetime appropriation and is available
until June 30, 2026.
new text end

Sec. 5.

Laws 2021, First Special Session chapter 3, article 1, section 2, subdivision 5, as
amended by Laws 2022, chapter 95, article 1, section 1, subdivision 5, is amended to read:

Subd. 5. Administration and Financial Assistance

11,477,000

13,429,000

(a) $474,000 the first year and $474,000 the
second year are for payments to county and
district agricultural societies and associations
under Minnesota Statutes, section 38.02,
subdivision 1. Aid payments to county and
district agricultural societies and associations
shall be disbursed no later than July 15 of each
year. These payments are the amount of aid
from the state for an annual fair held in the
previous calendar year.

(b) $387,000 the first year and $337,000 the
second year are for farm advocate services.
Of these amounts, $100,000 the first year and
$50,000 the second year are for a pilot
program creating farmland access teams to
provide technical assistance to potential
beginning farmers. The farmland access teams
must assist existing farmers and beginning
farmers on transitioning farm ownership and
operation. Services provided by teams may
include but are not limited to providing
mediation assistance, designing contracts,
financial planning, tax preparation, estate
planning, and housing assistance. Of this
amount for farm transitions, up to $50,000 the
first year may be used to upgrade the
Minnesota FarmLink web application that
connects farmers looking for land with farmers
looking to transition their land.

(c) $47,000 the first year and $47,000 the
second year are for grants to the Northern
Crops Institute that may be used to purchase
equipment. These are onetime appropriations.

(d) $238,000 the first year and $260,000 the
second year are for a pass-through grant to
Region Five Development Commission to
provide, in collaboration with Farm Business
Management, statewide mental health
counseling support to Minnesota farm
operators, families, and employees, and
individuals who work with Minnesota farmers
in a professional capacity. Region Five
Development Commission may use up to 6.5
percent of the grant awarded under this
paragraph for administration. The base for this
appropriation is $260,000 in fiscal year 2024
and later.

(e) $1,700,000 the first year and $1,700,000
the second year are for grants to Second
Harvest Heartland on behalf of Minnesota's
six Feeding America food banks for the
following:

(1) to purchase milk for distribution to
Minnesota's food shelves and other charitable
organizations that are eligible to receive food
from the food banks. Milk purchased under
the grants must be acquired from Minnesota
milk processors and based on low-cost bids.
The milk must be allocated to each Feeding
America food bank serving Minnesota
according to the formula used in the
distribution of United States Department of
Agriculture commodities under The
Emergency Food Assistance Program. Second
Harvest Heartland may enter into contracts or
agreements with food banks for shared funding
or reimbursement of the direct purchase of
milk. Each food bank that receives funding
under this clause may use up to two percent
for administrative expenses;

(2) to compensate agricultural producers and
processors for costs incurred to harvest and
package for transfer surplus fruits, vegetables,
and other agricultural commodities that would
otherwise go unharvested, be discarded, or
sold in a secondary market. Surplus
commodities must be distributed statewide to
food shelves and other charitable organizations
that are eligible to receive food from the food
banks. Surplus food acquired under this clause
must be from Minnesota producers and
processors. Second Harvest Heartland may
use up to 15 percent of each grant awarded
under this clause for administrative and
transportation expenses; and

(3) to purchase and distribute protein products,
including but not limited to pork, poultry, beef,
dry legumes, cheese, and eggs to Minnesota's
food shelves and other charitable organizations
that are eligible to receive food from the food
banks. Second Harvest Heartland may use up
to two percent of each grant awarded under
this clause for administrative expenses. Protein
products purchased under the grants must be
acquired from Minnesota processors and
producers.

Of the amount appropriated under this
paragraph, at least $600,000 each year must
be allocated under clause (1). Notwithstanding
Minnesota Statutes, section 16A.28, any
unencumbered balance the first year does not
cancel and is available in the second year.
Second Harvest Heartland must submit
quarterly reports to the commissioner and the
chairs and ranking minority members of the
legislative committees with jurisdiction over
agriculture finance in the form prescribed by
the commissioner. The reports must include
but are not limited to information on the
expenditure of funds, the amount of milk or
other commodities purchased, and the
organizations to which this food was
distributed.

(f) $250,000 the first year and $250,000 the
second year are for grants to the Minnesota
Agricultural Education and Leadership
Council for programs of the council under
Minnesota Statutes, chapter 41D.

(g) $1,437,000 the first year and $1,437,000
the second year are for transfer to the
agricultural and environmental revolving loan
account established under Minnesota Statutes,
section 17.117, subdivision 5a, for low-interest
loans under Minnesota Statutes, section
17.117. The base for appropriations under this
paragraph in fiscal year 2024 and thereafter
is $1,425,000. The commissioner must
examine how the department could use up to
one-third of the amount transferred to the
agricultural and environmental revolving loan
account under this paragraph to award grants
to rural landowners to replace septic systems
that inadequately protect groundwater. No
later than February 1, 2022, the commissioner
must report to the legislative committees with
jurisdiction over agriculture finance and
environment finance on the results of the
examination required under this paragraph.
The commissioner's report may include other
funding sources for septic system replacement
that are available to rural landowners.

(h) $150,000 the first year and $150,000 the
second year are for grants to the Center for
Rural Policy and Development. These are
onetime appropriations.

(i) $150,000 the first year is to provide grants
to Central Lakes College for the purposes of
designing, building, and offering credentials
in the area of meat cutting and butchery that
align with industry needs as advised by local
industry advisory councils. Notwithstanding
Minnesota Statutes, section 16A.28, any
unencumbered balance does not cancel at the
end of the first year and is available for the
second year. The commissioner may only
award a grant under this paragraph if the grant
is matched by a like amount from another
funding source. The commissioner must seek
matching dollars from Minnesota State
Colleges and Universities or other entities.
The appropriation is onetime and is available
until June 30, 2024. Any money remaining on
June 30, 2024, must be transferred to the
agricultural growth, research, and innovation
program under Minnesota Statutes, section
41A.12, and is available until June 30, 2025.
Grants may be used for costs including but
not limited to:

(1) facility renovation to accommodate meat
cutting;

(2) curriculum design and approval from the
Higher Learning Commission;

(3) program operational start-up costs;

(4) equipment required for a meat cutting
program; and

(5) meat handling start-up costs in regard to
meat access and market channel building.

No later than January 15, 2023, Central Lakes
College must submit a report outlining the use
of grant money to the chairs and ranking
minority members of the legislative
committees and divisions with jurisdiction
over agriculture and higher education.

(j) $2,000 the first year is for grants to the
Minnesota State Poultry Association. This is
a onetime appropriation. Notwithstanding
Minnesota Statutes, section 16A.28, any
unencumbered balance does not cancel at the
end of the first year and is available for the
second year.

(k) $17,000 the first year and $17,000 the
second year are for grants to the Minnesota
State Horticultural Society. These are onetime
appropriations.

(l) $18,000 the first year and $18,000 the
second year are for grants to the Minnesota
Livestock Breeders Association. These are
onetime appropriations.

(m) The commissioner shall continue to
increase connections with ethnic minority and
immigrant farmers to farming opportunities
and farming programs throughout the state.

(n) $25,000 the first year and $25,000 the
second year are for grants to the Southern
Minnesota Initiative Foundation to promote
local foods through an annual event that raises
public awareness of local foods and connects
local food producers and processors with
potential buyers.

(o) $75,000 the first year and $75,000 the
second year are for grants to Greater Mankato
Growth, Inc., for assistance to
agriculture-related businesses to promote jobs,
innovation, and synergy development. These
are onetime appropriations.

(p) $75,000 the first year and $75,000 the
second year are for grants to the Minnesota
Turf Seed Council for basic and applied
research. The Minnesota Turf Seed Council
may subcontract with a qualified third party
for some or all of the basic or applied research.
No later than January 15, 2023, the Minnesota
Turf Seed Council must submit a report
outlining the use of the grant money and
related accomplishments to the chairs and
ranking minority members of the legislative
committees with jurisdiction over agriculture.
These are onetime appropriations. Any
unencumbered balance does not cancel at the
end of the first year and is available for the
second year.

(q) $150,000 the first year and $150,000 the
second year are to establish an emerging
farmer office and hire a full-time emerging
farmer outreach coordinator. The emerging
farmer outreach coordinator must engage and
support emerging farmers regarding resources
and opportunities available throughout the
Department of Agriculture and the state. For
purposes of this paragraph, "emerging farmer"
has the meaning provided in Minnesota
Statutes, section 17.055, subdivision 1. Of the
amount appropriated each year, $25,000 is for
translation services for farmers and cottage
food producers.

(r) $222,000 the first year and $286,000 the
second year are to maintain the current level
of service delivery.

(s) $827,000 the second year is to award and
administer grants to:

(1) organizations to provide technical and
culturally appropriate services to emerging
farmers and related businesses;

(2) organizations to help emerging farmers
pay for up to 65 percent of premium expenses
each year up to two years under the federal
micro farm insurance program; and

(3) The Good Acre for the Local Emergency
Assistance Farmer Fund (LEAFF) program to
compensate emerging farmers for crops
donated to hunger relief organizations in
Minnesota.

This is a onetime appropriation and is
available until June 30, 2024.

(t) $750,000 the second year is to support the
IT modernization efforts, including laying the
technology foundations needed for improving
customer interactions with the department for
licensing and payments. The base for this
appropriation is $584,000 in fiscal year 2024
and $0 in fiscal year 2025.

(u) $1,500,000 the first year is for transfer to
the agricultural emergency account established
under Minnesota Statutes, section 17.041. This
is a onetime transfer. This transfer is in
addition to the appropriations made in Laws
2022, chapter 47, section 2.

Notwithstanding Minnesota Statutes, section
17.041, the commissioner may use the amount
to be transferred for the purposes identified
under Laws 2022, chapter 47, section 2,
paragraph (b). This paragraph expires on
December 31, 2022.

(v) $250,000 in the second year is for a grant
to the Board of Regents of the University of
Minnesota to purchase equipment for the
Veterinary Diagnostic Laboratory to test for
chronic wasting disease, African swine fever,
avian influenza, and other animal diseases.
The Veterinary Diagnostic Laboratory must
report expenditures under this paragraph to
the legislative committees with jurisdiction
over agriculture finance and higher education
with initial reports completed by January 3,
2023, and January 3, 2024, and a final report
by deleted text begin September 1, 2025 deleted text end new text begin December 31, 2024 new text end .
The reports must include a list of equipment
purchased, including the cost of each item.
The base for this appropriation is $250,000 in
fiscal year 2024 and $0 in fiscal year 2025.

(w) $141,000 the second year is for additional
funding to administer the beginning farmer
tax credit. The base for this appropriation is
$56,000 in fiscal year 2024 and later.

(x) $750,000 the second year is for a grant to
the Ag Innovation Campus to continue
construction of a soybean processing and
research facility. This is a onetime
appropriation.

The commissioner shall submit a report on the
utilization of the grants to the chairs and
ranking minority members of the legislative
committees and divisions with jurisdiction
over agriculture policy and finance by
February 1, 2024.

(y) $50,000 is added to the base for fiscal year
2024 and $0 for fiscal year 2025 to provide
technical assistance and leadership in the
development of a comprehensive and
well-documented state aquaculture plan. The
commissioner must provide the state
aquaculture plan to the legislative committees
with jurisdiction over agriculture finance and
policy by February 15, 2025.

(z) $500,000 the second year is to award and
administer down payment assistance grants
under Minnesota Statutes, section 17.133. The
base for this appropriation is $750,000 in fiscal
year 2024 and thereafter. new text begin Any unspent funds
are available until the end of the following
fiscal year.
new text end

(aa) $350,000 the second year is to provide
grants to secondary career and technical
education programs for the purpose of offering
instruction in meat cutting and butchery. By
January 15, 2023, the commissioner must
report to the chairs and ranking minority
members of the committees with jurisdiction
over agriculture finance and education finance
by listing the grants made under this paragraph
by county and noting the number and amount
of grant requests not fulfilled. The report may
include additional information as determined
by the commissioner, including but not limited
to information regarding the outcomes
produced by these grants. If additional grants
are awarded under this paragraph that were
not covered in the report due by January 15,
2023, the commissioner must submit an
additional report to the chairs and ranking
minority members of the committees with
jurisdiction over agriculture finance and
education finance regarding all grants issued
under this paragraph by November 1, 2023.
This is a onetime appropriation. Grants may
be used for costs, including but not limited to:

(1) equipment required for a meat cutting
program;

(2) facility renovation to accommodate meat
cutting; and

(3) training faculty to teach the fundamentals
of meat processing.

A grant recipient may be awarded a grant of
up to $70,000 and may use up to ten percent
of the grant for faculty training.

Priority may be given to applicants who are
coordinating with meat cutting and butchery
programs at Minnesota State Colleges and
Universities system and local industry
partners.

Sec. 6. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 to 4 are effective July 1, 2023. Section 5 is effective the day following final
enactment.
new text end

ARTICLE 2

AGRICULTURE POLICY

Section 1.

Minnesota Statutes 2022, section 17.1016, subdivision 2, is amended to read:

Subd. 2.

Grant program.

(a) The commissioner may establish and implement a grant
program to help farmers finance new cooperatives that organize for purposes of operating
an agricultural product processing facility or marketing an agricultural product or agricultural
service.

(b) To be eligible for this program, a grantee must:

(1) be a cooperative organized under chapter 308A new text begin or 308B new text end ;

(2) certify that all control deleted text begin and equity in deleted text end new text begin of new text end the cooperative is from farmers, family farm
partnerships, family farm limited liability companies, or family farm corporations as defined
in section 500.24, subdivision 2, who are actively engaged in agricultural commodity
production;

(3) be operated primarily to process agricultural commodities or market agricultural
products or services produced in Minnesota; deleted text begin and
deleted text end

(4) receive agricultural commodities produced primarily by shareholders or members
of the cooperative new text begin ; and
new text end

new text begin (5) not allow nonpatron voting rights new text end .

(c) The commissioner may receive applications and make grants up to $50,000 to eligible
grantees for feasibility, marketing analysis, assistance with organizational development,
financing and managing new cooperatives, product development, development of business
and marketing plans, and predesign of facilities, including site analysis, the development
of bid specifications, preliminary blueprints and schematics, and the completion of purchase
agreements and other necessary legal documents.

(d) Grants must be matched dollar-for-dollar with other money or in-kind contributions.

Sec. 2.

Minnesota Statutes 2022, section 17.133, subdivision 2, is amended to read:

Subd. 2.

Grants.

The commissioner deleted text begin must deleted text end new text begin may new text end award farm down payment assistance
grants of up to $15,000 per eligible farmer. deleted text begin An eligible farmer must match the grant with
at least an equivalent amount deleted text end new text begin Each award must be matched with at least $5,000 new text end of other
funding. new text begin The commissioner must accept grant applications for at least 30 days. new text end An eligible
farmer must commit to own and farm the land purchased with assistance provided under
this section for at least five years. For each year that a grant recipient does not own and
farm the land during the five-year period, the grant recipient must pay a penalty to the
commissioner equal to 20 percent of the grant amount.

Sec. 3.

new text begin [17.134] SOIL HEALTH FINANCIAL ASSISTANCE PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin The commissioner must establish and administer a
program to support healthy soil management practices in accordance with this section.
new text end

new text begin Subd. 2. new text end

new text begin Eligible projects. new text end

new text begin The commissioner may award a grant under this section for
any project on agricultural land in Minnesota that will:
new text end

new text begin (1) increase the quantity of organic carbon in soil through practices, including but not
limited to reduced tillage, cover cropping, manure management, precision agriculture, crop
rotations, and changes in grazing management;
new text end

new text begin (2) integrate perennial vegetation into the management of agricultural lands;
new text end

new text begin (3) reduce nitrous oxide and methane emissions through changes to livestock, soil
management, or nutrient optimization;
new text end

new text begin (4) increase the usage of precision agricultural practices;
new text end

new text begin (5) enable the development of site-specific management plans; or
new text end

new text begin (6) enable the purchase of equipment, parts and materials, technology, subscriptions,
technical assistance, seeds, seedlings, or amendments that will further any of the purposes
in clauses (1) to (5).
new text end

new text begin Subd. 3. new text end

new text begin Grant eligibility. new text end

new text begin Any owner or lessee of farmland may apply for a grant under
this section. Local government units, including cities, towns, counties, soil and water
conservation districts, Tribal Nations, and joint powers boards, are also eligible for a grant.
A local government unit that receives a grant for equipment or technology must make those
purchases available for use by the public.
new text end

new text begin Subd. 4. new text end

new text begin Report. new text end

new text begin By January 15 each year, the commissioner must submit a report on
the grants awarded under this section to the chairs and ranking minority members of the
legislative committees and divisions with jurisdiction over agriculture policy and finance.
The report must include the number of grants awarded by county and the combined value
of those grants.
new text end

new text begin Subd. 5. new text end

new text begin Administrative costs. new text end

new text begin The commissioner may use up to five percent of any
funds appropriated for this program for costs incurred to administer the program.
new text end

Sec. 4.

Minnesota Statutes 2022, section 41A.14, subdivision 2, is amended to read:

Subd. 2.

Advisory panel.

(a) In awarding grants under this section, the commissioner
and a representative of the College of Food, Agricultural and Natural Resource Sciences at
the University of Minnesota must consult with an advisory panel consisting of the following
stakeholders:

(1) a representative of the Minnesota State Colleges and Universities system;

(2) a representative of the Minnesota Farm Bureau;

(3) a representative of the Minnesota Farmers Union;

(4) a person representing agriculture industry statewide;

(5) a representative of each of the state commodity councils organized under section
17.54 and the Minnesota Pork Board;

(6) a person representing an association of primary manufacturers of forest products;

(7) a person representing organic or sustainable agriculture; deleted text begin and
deleted text end

(8) a person representing statewide environment and natural resource conservation
organizations new text begin ; and
new text end

new text begin (9) a person representing the interests of Minnesota Tribal governments as defined in
section 10.65, subdivision 2, paragraph (a), clause (4) new text end .

(b) Members under paragraph (a), clauses (1) to (3) and (5), shall be chosen by their
respective organizations. new text begin The member under paragraph (a), clause (9), may be appointed
by the Minnesota Indian Affairs Council at the council's discretion.
new text end

Sec. 5.

Minnesota Statutes 2022, section 41A.19, is amended to read:

41A.19 REPORT; INCENTIVE PROGRAMS.

By January 15 each year, the commissioner shall report on the incentive programs under
sections 41A.16, 41A.17, 41A.18, new text begin and new text end 41A.20 deleted text begin , and 41A.21 deleted text end to the legislative committees
with jurisdiction over environment and agriculture policy and finance. The report shall
include information on production and incentive expenditures under the programs.

Sec. 6.

Minnesota Statutes 2022, section 223.16, is amended by adding a subdivision to
read:

new text begin Subd. 3c. new text end

new text begin Failure. new text end

new text begin "Failure" means a determination by the commissioner that a grain
buyer or grain warehouse has failed to pay for delivered grain, breached a contract, breached
more than one contract, or failed to redeliver stored grain to a producer.
new text end

Sec. 7.

Minnesota Statutes 2022, section 223.17, subdivision 6, is amended to read:

Subd. 6.

Financial statements.

(a) Except as allowed in paragraph (c), a grain buyer
licensed under this chapter must annually submit to the commissioner a financial statement
prepared in accordance with deleted text begin generally accepted accounting principles deleted text end new text begin national or international
accounting standards new text end . The annual financial statement required under this subdivision must
also:

(1) include, but not be limited to the following:

(i) a balance sheet;

(ii) a statement of income (profit and loss);

(iii) a statement of retained earnings;

(iv) a statement of changes in financial position; and

(v) a statement of the dollar amount of grain purchased in the previous fiscal year of the
grain buyer;

(2) be accompanied by a deleted text begin compilation deleted text end report of the financial statement that is prepared
by a grain commission firm or a management firm approved by the commissioner or by an
independent public accountant, in accordance with standards established by the American
Institute of Certified Public Accountants; new text begin and
new text end

(3) be accompanied by a certification by the chief executive officer or the chief executive
officer's designee of the licensee, and where applicable, all members of the governing board
of directors under penalty of perjury, that the financial statement accurately reflects the
financial condition of the licensee for the period specified in the statement deleted text begin ; deleted text end new text begin .
new text end

deleted text begin (4) for grain buyers purchasing under $7,500,000 of grain annually, be reviewed by a
certified public accountant in accordance with standards established by the American Institute
of Certified Public Accountants, and must show that the financial statements are free from
material misstatements; and
deleted text end

deleted text begin (5) for grain buyers purchasing $7,500,000 or more of grain annually, be audited by a
certified public accountant in accordance with standards established by the American Institute
of Certified Public Accountants and must include an opinion statement from the certified
public accountant.
deleted text end

(b) Only one financial statement must be filed for a chain of warehouses owned or
operated as a single business entity, unless otherwise required by the commissioner. All
financial statements filed with the commissioner are private or nonpublic data as provided
in section 13.02.

(c) A grain buyer who purchases grain immediately upon delivery solely with cash; a
certified check; a cashier's check; or a postal, bank, or express money order is exempt from
this subdivision deleted text begin if the grain buyer's gross annual purchases are $1,000,000 or less deleted text end .

(d) The commissioner shall annually provide information on a person's fiduciary duties
to each licensee. To the extent practicable, the commissioner must direct each licensee to
provide this information to all persons required to certify the licensee's financial statement
under paragraph (a), clause (3).

Sec. 8.

Minnesota Statutes 2022, section 223.17, subdivision 7, is amended to read:

Subd. 7.

deleted text begin Action on a bond deleted text end new text begin Breach of contract new text end .

A producer claiming to be damaged
by a breach of a contract for the purchase of grain by a deleted text begin licensed deleted text end grain buyer may file a
written claim with the commissioner. The claim must state the facts constituting the claim.
deleted text begin The claim must be filed with the commissioner within 180 days of the breach of the contract. deleted text end
If a claim is valid, the commissioner may immediately suspend the license, in which case
the licensee shall surrender the license to the commissioner. Within 15 days the licensee
may request an administrative hearing subject to chapter 14 to determine whether the license
should be revoked. If no request is made within 15 days, the commissioner shall revoke the
license.

Sec. 9.

Minnesota Statutes 2022, section 223.17, subdivision 7a, is amended to read:

Subd. 7a.

Bond requirements deleted text begin ; claims deleted text end .

For entities licensed under this chapter and
chapter 232, the bond requirements and deleted text begin claims deleted text end new text begin actions new text end against the bond are governed under
section deleted text begin 232.22, subdivision 6a deleted text end new text begin 223.28 new text end .

Sec. 10.

Minnesota Statutes 2022, section 223.175, is amended to read:

223.175 WRITTEN VOLUNTARY EXTENSION OF CREDIT CONTRACTS;
FORM.

A written confirmation required under section 223.177, subdivision 2, and a written
voluntary extension of credit contract must include those items prescribed by the
commissioner by rule. A contract shall include a statement of the legal and financial
responsibilities of grain buyers and sellers established in this chapter. A contract shall also
include the following statement in not less than ten point, all capital type, framed in a box
with space provided for the seller's signature: "THIS CONTRACT CONSTITUTES A
VOLUNTARY EXTENSION OF CREDIT. THIS CONTRACT deleted text begin IS NOT COVERED BY
ANY GRAIN BUYER'S BOND deleted text end new text begin MAY NOT BE COVERED COMPLETELY BY THE
GRAIN INDEMNITY ACCOUNT new text end ." If a written contract is provided at the time the grain
is delivered to the grain buyer, the seller shall sign the contract in the space provided beneath
the statement. A transaction that does not meet the provisions of a voluntary extension of
credit, including the issuance and signing of a voluntary extension of credit contract, is a
cash sale.

Sec. 11.

Minnesota Statutes 2022, section 223.19, is amended to read:

223.19 RULES.

The commissioner may make rules pursuant to chapter 14 to carry out the provisions of
sections 223.15 to deleted text begin 223.23 deleted text end new text begin 223.28 new text end .

Sec. 12.

new text begin [223.24] GRAIN INDEMNITY ACCOUNT.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin The grain indemnity account is established in the
agricultural fund. The grain indemnity account shall consist of grain indemnity premiums,
money from any other source, and interest.
new text end

new text begin Subd. 2. new text end

new text begin Account; appropriation. new text end

new text begin (a) Money in the grain indemnity account, including
interest, is appropriated to the commissioner to pay valid claims and to administer this
section.
new text end

new text begin (b) The commissioner shall direct payments from the grain indemnity account only for
the following purposes:
new text end

new text begin (1) the payment of valid claims;
new text end

new text begin (2) the payment of grain indemnity premium refunds;
new text end

new text begin (3) the payment of administrative expenses under paragraph (c);
new text end

new text begin (4) the payment of legal fees and legal expenses under subdivision 7; or
new text end

new text begin (5) the payment of a trustee appointed under subdivision 6.
new text end

new text begin (c) The commissioner shall allocate money from the grain indemnity account to a separate
administrative expenses account to pay or reimburse the agency for grain indemnity account
expenses. Administrative expenses under this paragraph include the actual cost of processing
payments and refunds, enforcement, record keeping, ordinary management and investment
fees connected with the operation of the grain indemnity account, and legal expenses.
new text end

new text begin Subd. 3. new text end

new text begin Eligibility. new text end

new text begin A producer is eligible to receive a grain indemnity payment from
the commissioner if the producer sold grain to a grain buyer as defined in this chapter or
stored grain with a public grain warehouse operator under chapter 232 and the producer is
damaged by the grain buyer's or public grain warehouse operator's failure to pay for or
redeliver grain.
new text end

new text begin Subd. 4. new text end

new text begin Application. new text end

new text begin (a) A producer asserting eligibility under subdivision 3 must file
a completed claim with the commissioner. The producer must state the facts constituting
the claim and all other information required by the commissioner.
new text end

new text begin (b) Upon receiving a claim, the commissioner must promptly determine the validity of
the claim and notify the claimant of the commissioner's determination.
new text end

new text begin (c) An aggrieved party may appeal the commissioner's determination by requesting,
within 15 days, that the commissioner initiate a contested case proceeding under chapter
14.
new text end

new text begin Subd. 5. new text end

new text begin Payment limitation. new text end

new text begin (a) For each failure as defined by section 223.16,
subdivision 3c, the commissioner must pay the eligible producer:
new text end

new text begin (1) the amount equal to the value of the grain sold on cash sale, grain assigned to
warehouse receipt, or grain assigned to open storage less than 180 days from the deposit;
new text end

new text begin (2) the amount equal to the value of grain sold up to $200,000, or the lesser of $750,000
or 75 percent of the amount owed to the seller for a contract in excess of $200,000 for a
deferred or delayed payment contract for which a price has been established when the
contract originated within 120 days of the breach of contract;
new text end

new text begin (3) the lesser of $750,000 or 75 percent of the amount owed to the seller for a voluntary
extension of credit contract for which no price has been established when the contract
originated within 180 days of the breach of contract;
new text end

new text begin (4) the lesser of $500,000 or 50 percent for an open storage assignment or a voluntary
extension of credit contract when the open storage assignment or contract originated between
181 days and 18 months from the failure; or
new text end

new text begin (5) the lesser of $250,000 or 25 percent for an open storage assignment or a voluntary
extension of credit contract when the open storage assignment or contract originated between
19 months and 36 months from the failure.
new text end

new text begin (b) Claims filed more than 36 months from the failure are not eligible for payment.
new text end

new text begin (c) For the purposes of this subdivision, multiple breaches of contract with a single entity
constitute one failure.
new text end

new text begin (d) If a grain buyer holds both a Minnesota grain buyer license, as defined in chapter
223, and a license with the United States Department of Agriculture (USDA) under the
United States Warehouse Act, a seller may only file a claim with the grain indemnity account
if the seller sold grain as a cash sale or under a voluntary extension of credit contract. The
commissioner must deny any claims for stored grain from a seller that holds both a Minnesota
grain buyer license and a license with the USDA under the United States Warehouse Act.
new text end

new text begin (e) If valid claims exceed the amount of money available in the grain indemnity account,
the commissioner must pay claims to producers in the order that the claims were received.
When additional money becomes available, the commissioner must resume issuing grain
indemnity payments to each eligible producer until each producer receives the maximum
amount payable under paragraph (a).
new text end

new text begin (f) If the grain indemnity account balance is insufficient to pay refunds under section
223.26 and valid claims exist, once money is deposited into the grain indemnity account,
the commissioner must issue pending refunds for grain indemnity premium payments before
issuing payments to claimants.
new text end

new text begin Subd. 6. new text end

new text begin Court order. new text end

new text begin (a) The commissioner may apply to a district court for an order
appointing a trustee or receiver to manage and supervise the operations of a grain buyer or
public grain warehouse operator in default. The commissioner may participate in any
resulting court proceeding as an interested party.
new text end

new text begin (b) The commissioner may recover the cost of the appointed trustee using money
appropriated under subdivision 2.
new text end

new text begin Subd. 7. new text end

new text begin Debt obligation; subrogated claim. new text end

new text begin (a) Money paid by the commissioner to
satisfy a valid claim constitutes a debt obligation of the grain buyer or public grain warehouse
operator in default. The commissioner may take action against the grain buyer or public
grain warehouse operator to recover the amount of any claim payment plus reasonable costs,
attorney fees, and interest computed at the rate provided in section 270C.40. The
commissioner must deposit any amount recovered under this subdivision in the grain
indemnity account.
new text end

new text begin (b) As a condition of payment from the commissioner, a producer must subrogate the
producer's interest in a voluntary extension of credit contract to the commissioner in an
amount equal to any claim payment or payments that the producer received under this
section.
new text end

new text begin (c) The commissioner may recover any debt to the grain indemnity account from a
member of the board or management who acted negligently or fraudulently.
new text end

Sec. 13.

new text begin [223.25] GRAIN INDEMNITY PREMIUMS.
new text end

new text begin Subdivision 1. new text end

new text begin Charges. new text end

new text begin (a) Except as provided in subdivision 3, producers of grain
must be charged a grain indemnity premium as determined and published by the
commissioner not to exceed 0.2 percent of the price on all marketed grain that is sold to a
grain buyer as defined in chapter 223.
new text end

new text begin (b) The grain indemnity premiums required under this section are in addition to any
other fees or assessments required by law.
new text end

new text begin Subd. 2. new text end

new text begin Collection and submission of grain indemnity premiums. new text end

new text begin (a) Each producer
must pay to the commissioner a grain indemnity premium of not more than 0.2 percent of
the net proceeds from all grain sold by the producer to a grain buyer purchasing grain in
Minnesota. When a producer sells grain to a grain buyer, the grain buyer must deduct the
grain indemnity premium from the proceeds of the sale and pay the grain indemnity premium
to the commissioner on behalf of the producer.
new text end

new text begin (b) When purchasing grain from a producer, a grain buyer must deduct the grain
indemnity premium described in paragraph (a) from the proceeds of the sale and notify the
producer of the amount of the deduction in writing. The grain buyer must forward the grain
indemnity premium to the commissioner for deposit into the grain indemnity account on
behalf of the producer as described in this subdivision.
new text end

new text begin (c) A grain buyer must clearly indicate the grain indemnity premiums collected under
paragraph (b) in the grain buyer's books and records. A grain buyer must retain books and
records containing the grain indemnity premiums for at least three years. A grain buyer
must make the grain buyer's books and records available for inspection by the commissioner
during regular business hours. The department must take steps reasonably necessary to
verify the accuracy of the grain indemnity premiums as recorded in the grain buyer's books
and records. Any record or portion thereof seized or copied by the commissioner is private
or nonpublic data as provided in section 13.02, except that the commissioner may disclose
data to aid in the law enforcement process.
new text end

new text begin (d) A grain buyer must submit grain indemnity premiums collected under paragraph (a)
to the commissioner for the purpose of financing or contributing to the financing of the
grain indemnity account by:
new text end

new text begin (1) January 31 for grain indemnity premiums collected during the months of July, August,
September, October, November, and December; and
new text end

new text begin (2) July 31 for grain indemnity premiums collected during the months of January,
February, March, April, May, and June.
new text end

new text begin Subd. 3. new text end

new text begin Amount in grain indemnity account; basis for suspension and reinstatement
of grain indemnity premium collection. new text end

new text begin (a) Except as provided in paragraph (b), the grain
indemnity premiums required under this section must be collected until the grain indemnity
account contains more than $15,000,000 as of June 30 of any given year.
new text end

new text begin (b) The commissioner may not require the collection of additional grain indemnity
premiums until the amount in the grain indemnity account drops below $9,000,000. In a
year when the commissioner determines that the grain indemnity account is at or below
$9,000,000, the commissioner may reinstate the collection described in this section.
new text end

new text begin (c) The commissioner shall announce the intention to collect the premiums described
in this section by May 1 with collection to begin July 1 until the grain indemnity account
contains at least $15,000,000. The commissioner must notify the public of the commissioner's
intent to reinstate collection of additional grain indemnity premiums through publication
in the State Register and by notifying each licensee of the licensee's obligation to collect
premiums.
new text end

Sec. 14.

new text begin [223.26] GRAIN INDEMNITY OPT OUT.
new text end

new text begin (a) A producer that has paid a grain indemnity premium under section 223.25 may receive
a refund of that premium from the grain indemnity account by submitting a written demand
for a refund to the commissioner, delivered personally or by first-class mail within 12 months
after the producer paid the grain indemnity premium.
new text end

new text begin (b) The commissioner must prepare a poster and a distributable flyer explaining how a
producer can opt out of the grain indemnity program and must post these documents on the
Department of Agriculture website. The commissioner must provide printed copies of the
poster and flyer at no cost to all licensed grain buyers and warehouses. Upon receiving
printed copies of posters and flyers, the licensed businesses must post the poster in a
conspicuous location and must make the flyers available for anyone visiting the licensed
business.
new text end

new text begin (c) A producer must submit a demand for a refund of a grain indemnity premium under
paragraph (a) on a demand for refund form developed by the commissioner. The
commissioner must make the form available to a licensee, producer, or member of the public
upon request.
new text end

new text begin (d) If a producer is entitled to a refund of a grain indemnity premium under this section,
the commissioner must pay the refund within 90 days of receiving the demand for a refund.
If the grain indemnity account balance is insufficient to pay refunds under this subdivision
and valid claims exist, the commissioner must issue refunds for grain indemnity premium
payments before issuing payments to claimants once money is deposited into the grain
indemnity account.
new text end

new text begin (e) If the commissioner announces grain indemnity premiums as required under section
223.25, subdivision 3, by June 30, the commissioner must send a notice to each producer
who requested a refund of a grain indemnity premium during the previous three fiscal years.
The notice must inform the producer of the deadline for and method of submitting a demand
for a refund to the commissioner under paragraphs (a) and (c) and the method for reentering
the grain indemnity program under paragraph (f).
new text end

new text begin (f) A producer that receives a refund of a grain indemnity premium under paragraph (a)
is not entitled to participate in the grain indemnity program or to receive any payment under
this section unless the producer reenters the grain indemnity program by meeting all of the
following conditions:
new text end

new text begin (1) the producer must submit a request for reentry into the grain indemnity program to
the commissioner. The producer must submit the request on the form required by the
commissioner and must deliver the request to the commissioner;
new text end

new text begin (2) the producer's request must be approved by the commissioner; and
new text end

new text begin (3) the producer must pay into the grain indemnity account all grain indemnity premiums
that were refunded to the producer and interest on the refunds as determined by the
commissioner.
new text end

new text begin (g) A producer that reenters the grain indemnity program under paragraph (f) is eligible
to be reimbursed for claims under the grain indemnity program for any breach of contract
that occurs at least 90 days after (1) an application for reentry, and (2) all required payments
have been made.
new text end

new text begin (h) A producer is not eligible for a refund of a grain indemnity premium under this
section if the producer has received payment from the grain indemnity account for a valid
claim within the preceding 36 months.
new text end

Sec. 15.

new text begin [223.27] PENALTIES; ENFORCEMENT ACTION; COSTS AND
EXPENSES.
new text end

new text begin (a) In addition to any other penalty or remedy provided by law, a person who knowingly
or intentionally commits any of the following is subject to civil penalties under section
18J.10:
new text end

new text begin (1) refusing or failing to collect any grain indemnity premiums as required under section
223.25;
new text end

new text begin (2) refusing or failing to pay to the commissioner any grain indemnity premiums collected
under section 223.25;
new text end

new text begin (3) making a false statement, representation, or certification, or knowingly failing to
make a required statement, representation, or certification in a record, report, or other
document required under this chapter or filed with the commissioner; or
new text end

new text begin (4) resisting, preventing, impeding, or interfering with the commissioner in the
performance of the commissioner's duties under this chapter.
new text end

new text begin (b) In addition to the civil penalty described in paragraph (a), the commissioner in an
enforcement action for a violation described in paragraph (a), clause (1) or (2), must order
the grain buyer to pay into the grain indemnity account any grain indemnity premiums
collected by the grain buyer that the grain buyer owes to the grain indemnity account and
may order the grain buyer to pay interest on the amount that the grain buyer owes to the
grain indemnity account.
new text end

Sec. 16.

new text begin [223.28] GRAIN BONDS; NEW LICENSE HOLDERS.
new text end

new text begin (a) Except as provided in paragraph (b), before the commissioner issues a grain buyer
or public grain warehouse operator license, a person who has not been licensed to buy grain
or operate a public grain warehouse in the previous licensing period must file with the
commissioner a grain bond in a penal sum of $100,000. A grain bond must remain in effect
for the first three years of the license.
new text end

new text begin (b) A grain buyer who purchases grain immediately upon delivery solely with cash; a
certified check; a cashier's check; or a postal, bank, or express money order is exempt from
this subdivision if the grain buyer's gross annual purchases are $1,000,000 or less.
new text end

new text begin (c) The commissioner may require a supplemental bond in an amount prescribed by the
commissioner based on the financial statements required in section 223.17, subdivision 6.
new text end

new text begin (d) A grain bond must be on a form provided by the commissioner.
new text end

new text begin (e) A grain bond required under paragraphs (a) and (c) must provide for the payment of
any loss caused by the grain buyer's failure to pay upon the owner's demand, including loss
caused by the grain buyer's failure to pay within the time required. The grain bond must be
conditioned upon the grain buyer being duly licensed.
new text end

new text begin (f) A grain bond required under paragraphs (a) and (c) that is obtained by a public grain
warehouse operator must be conditioned that the public grain warehouse operator issuing
a grain warehouse receipt is liable to the depositor for the delivery of the kind, grade, and
net quantity of grain called for by the receipt. A grain bond must be conditioned upon the
operator being duly licensed.
new text end

new text begin (g) A grain bond must not be cumulative from one licensing period to the next. The
maximum liability of the grain bond must be the grain bond's face value for the licensing
period.
new text end

new text begin (h) A grain bond must be continuous until canceled. To cancel a grain bond, a surety
must provide 90 days' written notice of the grain bond's termination date to the licensee and
the commissioner.
new text end

new text begin (i) Upon the commissioner's determination that a claim is valid, the surety for any claims
against the grain bond must make payments to the grain indemnity account.
new text end

Sec. 17.

Minnesota Statutes 2022, section 232.22, subdivision 5, is amended to read:

Subd. 5.

Statement of grain in storage; reports.

deleted text begin (a) All public grain warehouse operators
must by February 15 of each year file with the commissioner on a form approved by the
commissioner a report showing the annual average liability of all grain outstanding on grain
warehouse receipts, open storage, and grain stored for feed processing that occurred during
the preceding calendar year. This report shall be used for the purpose of establishing the
penal sum of the bond.
deleted text end

deleted text begin (b) Warehouse operators that are at a maximum bond and want to continue at maximum
bond do not need to file this report.
deleted text end

deleted text begin (c) It is a violation of this chapter for any public grain warehouse operator to fail to file
the report required in paragraph (a).
deleted text end

deleted text begin (d) deleted text end new text begin (a) new text end Every public grain warehouse operator shall keep in a place of safety complete
and accurate records and accounts relating to any grain warehouse operated. The records
shall reflect each commodity received and shipped daily, the balance remaining in the grain
warehouse at the close of each business day, a listing of all unissued grain warehouse receipts
in the operator's possession, a record of all grain warehouse receipts issued which remain
outstanding and a record of all grain warehouse receipts which have been returned for
cancellation. Copies of grain warehouse receipts or other documents evidencing ownership
of grain by a depositor, or other liability of the grain warehouse operator, shall be retained
as long as the liability exists but must be kept for a minimum of three years.

deleted text begin (e) deleted text end new text begin (b) new text end Every public grain warehouse operator must maintain in the grain warehouse at
all times grain of proper grade and sufficient quantity to meet delivery obligations on all
outstanding grain warehouse receipts.

Sec. 18.

Laws 2022, chapter 95, article 2, section 29, subdivision 6, is amended to read:

Subd. 6.

Expiration.

This section expires deleted text begin June 30 deleted text end new text begin December 31 new text end , 2024.

Sec. 19. new text begin BIOINCENTIVE REPORT.
new text end

new text begin The commissioner of agriculture, in consultation with the commissioners of commerce
and employment and economic development, must prepare a report on alternative methods
to pay past claims filed under the bioincentive program under Minnesota Statutes, sections
41A.16, 41A.17, and 41A.18, and provide for adequate and sustainable funding to pay
current and future claims under those sections. The report must be submitted to the chairs
and minority members of the legislative committees and divisions with jurisdiction over
any proposed funding source and administration of the bioincentive program by January
15, 2024.
new text end

Sec. 20. new text begin WOLF-LIVESTOCK CONFLICT-PREVENTION PROGRAM.
new text end

new text begin (a) The commissioner of agriculture may award grants to livestock producers to prevent
wolf-livestock conflicts. Livestock producers located in Minnesota are eligible to apply for
reimbursement for the cost of practices to prevent wolf-livestock conflicts. The commissioner
may establish a cap on the amount of grant money that a recipient is eligible to receive
annually.
new text end

new text begin (b) To be eligible for a grant under this section, a livestock producer must raise livestock
within Minnesota's wolf range or on property determined by the commissioner to be affected
by wolf-livestock conflicts.
new text end

new text begin (c) A grant applicant must document a cost-share of 20 percent for activities covered
by a grant under this program. A grant applicant's cost-share amount may be reduced up to
$2,000 to cover the time and labor costs of wolf-livestock conflict prevention activities.
new text end

new text begin (d) Eligible wolf-livestock conflict-prevention activities include but are not limited to:
new text end

new text begin (1) the purchase of guard animals;
new text end

new text begin (2) payment of veterinary costs for guard animals;
new text end

new text begin (3) the installation of wolf barriers, which may include pens, fladry, and fencing necessary
to protect livestock;
new text end

new text begin (4) the installation of wolf-deterring lights and alarms; and
new text end

new text begin (5) the installation of calving or lambing shelters.
new text end

new text begin (e) Eligible grant recipients must:
new text end

new text begin (1) make a good faith effort to avoid wolf-livestock conflicts;
new text end

new text begin (2) make a good faith effort to care for guard animals paid for under this section;
new text end

new text begin (3) retain proper documentation of expenses;
new text end

new text begin (4) report annually to the commissioner on the effectiveness of the nonlethal methods
employed; and
new text end

new text begin (5) allow follow-up evaluations and monitoring by the commissioner.
new text end

new text begin (f) Grant recipients shall continue to be eligible for depredation payments under
Minnesota Statutes, section 3.737.
new text end

Sec. 21. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2022, sections 17.055, subdivision 2; 41A.12, subdivision 4; 41A.21;
223.17, subdivisions 4 and 8; and 232.22, subdivisions 4, 6, 6a, and 7, new text end new text begin are repealed.
new text end

Sec. 22. new text begin EFFECTIVE DATE.
new text end

new text begin This article is effective July 1, 2023.
new text end

ARTICLE 3

BROADBAND

Section 1. new text begin BROADBAND DEVELOPMENT APPROPRIATIONS. new text end

new text begin The sums shown in the columns marked "Appropriations" are appropriated to the agencies
and for the purposes specified in this article. The appropriations are from the general fund,
or another named fund, and are available for the fiscal years indicated for each purpose.
The figures "2024" and "2025" used in this article mean that the appropriations listed under
them are available for the fiscal year ending June 30, 2024, or June 30, 2025, respectively.
"The first year" is fiscal year 2024. "The second year" is fiscal year 2025. "The biennium"
is fiscal years 2024 and 2025.
new text end

			new text begin APPROPRIATIONS new text end
			new text begin Available for the Year new text end
			new text begin Ending June 30 new text end
				new text begin 2024 new text end		new text begin 2025 new text end

Sec. 2. new text begin DEPARTMENT OF EMPLOYMENT AND ECONOMIC DEVELOPMENT new text end

new text begin $ new text end

new text begin 75,350,000 new text end

new text begin $ new text end

new text begin 50,350,000 new text end

new text begin (a) $350,000 each year is for the Office of
Broadband Development.
new text end

new text begin (b) $55,000,000 the first year and $30,000,000
the second year are transferred from the
general fund to the border-to-border broadband
fund account established in Minnesota
Statutes, section 116J.396. These transfers are
onetime.
new text end

new text begin (c) $20,000,000 the first year and $20,000,000
the second year are appropriated to the
commissioner for the lower population density
grant program to award grants to provide
broadband service to unserved and
underserved areas of the state where a 50
percent match formula is not adequate to make
a business case for the extension of broadband
facilities. Grants awarded under this paragraph
may fund up to 75 percent of the total cost of
a project and must otherwise adhere to
Minnesota Statutes, section 116J.395,
subdivisions 1 to 6; subdivision 7, paragraph
(b); and subdivision 8. These appropriations
are onetime.
new text end

Sec. 3.

Minnesota Statutes 2022, section 116J.395, subdivision 7, is amended to read:

Subd. 7.

Limitation.

(a) No grant awarded under this section may fund more than 50
percent of the total cost of a project.

(b) Grants awarded to a single project under this section must not exceed deleted text begin $5,000,000 deleted text end new text begin
$10,000,000 new text end .

Sec. 4.

new text begin [116J.3952] LOWER POPULATION DENSITY GRANT PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin A lower population density grant program is established
in the Department of Employment and Economic Development. The purpose of the lower
population density grant program is to provide broadband service to unserved and
underserved areas of the state where a 50 percent match formula is not adequate to make a
business case for the extension of broadband facilities.
new text end

new text begin Subd. 2. new text end

new text begin Grants. new text end

new text begin Grants awarded under this section may fund up to 75 percent of the
total cost of a project and must otherwise adhere to section 116J.395, subdivisions 1 to 6
and subdivision 7, paragraph (b).
new text end

Sec. 5.

Minnesota Statutes 2022, section 116J.396, subdivision 2, is amended to read:

Subd. 2.

Expenditures.

Money in the account may be used only:

(1) for grant awards made under sections 116J.395 deleted text begin and deleted text end new text begin to new text end deleted text begin 116J.3951 deleted text end new text begin 116J.3952 new text end , including
costs incurred by the Department of Employment and Economic Development to administer
that section;

(2) to supplement revenues raised by bonds sold by local units of government for
broadband infrastructure development; or

(3) to contract for the collection of broadband deployment data from providers and the
creation of maps showing the availability of broadband service.

Sec. 6. new text begin EFFECTIVE DATE.
new text end

new text begin This article is effective July 1, 2023.
new text end

APPENDIX

Repealed Minnesota Statutes: S1955-1

17.055 EMERGING FARMERS.

Subd. 2.

Expiration.

This section expires August 1, 2025.

41A.12 AGRICULTURAL GROWTH, RESEARCH, AND INNOVATION PROGRAM.

Subd. 4.

Sunset.

This section expires on June 30, 2025.

41A.21 ORIENTED STRAND BOARD PRODUCTION INCENTIVE.

Subdivision 1.

Definitions.

(a) For the purposes of this section, the terms defined in this subdivision have the meanings given them.

(b) "Commissioner" means the commissioner of agriculture.

(c) "Forest resources" means raw wood logs and material primarily made up of cellulose, hemicellulose, or lignin, or a combination of those ingredients.

(d) "Oriented strand board" or "OSB" means a material manufactured into panels using forest resources.

Subd. 2.

Eligibility.

(a) A facility eligible for payment under this section must source at least 80 percent of its forest resources raw materials from Minnesota. The facility must be located in Minnesota; must begin construction activities by December 31, 2023, for a specific location; must have produced at least one OSB square foot on a 3/8-inch nominal basis at a specific location by June 30, 2026; and must not begin operating before January 1, 2022. Eligible facilities must be new OSB construction sites with total capital investment in excess of $250,000,000. Eligible OSB production facilities must produce at least 50,000,000 OSB square feet on a 3/8-inch nominal basis of OSB each quarter. At least one product produced at the facility should be a wood-based wall or roof structural sheathing panel that has an integrated, cellulose-based paper overlay that serves as a water resistive barrier.

(b) No payments shall be made for OSB production that occurs after June 30, 2036, for those eligible producers under paragraph (a).

(c) An eligible producer of OSB shall not transfer the producer's eligibility for payments under this section to a facility at a different location.

(d) A producer that ceases production for any reason is ineligible to receive payments under this section until the producer resumes production.

Subd. 3.

Payment amounts; limits.

(a) The commissioner shall make payments to eligible producers of OSB. The amount of the payment for each eligible producer's annual production is $7.50 per 1,000 OSB square feet on a 3/8-inch nominal basis of OSB produced at a specific location for ten years starting after the first calendar year in which production begins.

(b) Total payments under this section to an eligible OSB producer in a fiscal year may not exceed the amount necessary for 400,000,000 OSB square feet on a 3/8-inch nominal basis of OSB produced. Total payments under this section to all eligible OSB producers in a fiscal year may not exceed the amount necessary for 400,000,000 OSB square feet on a 3/8-inch nominal basis of OSB produced. If the total amount for which all producers are eligible in a quarter exceeds the amount available for payments, the commissioner shall make the payments on a pro rata basis.

(c) For purposes of this section, an entity that holds a controlling interest in more than one OSB facility is considered a single eligible producer.

Subd. 4.

Forest resources requirements.

Forest resources that are purchased to be used at the facility must be in compliance with one or more of the following: the Sustainable Forestry Initiative Fiber Sourcing Standard, the Forest Stewardship Council Chain of Custody Standard, or the Forest Stewardship Controlled Wood Standard. For forest resources that come from land parcels greater than 160 acres, all efforts must be made to procure from land that is certified by one or more of the following: the Forest Stewardship Council Forest Management Standard, the Sustainable Forestry Initiative Forest Management Standard, or the American Tree Farm System.

Subd. 5.

Claims.

(a) By the last day of October, January, April, and July, each eligible OSB producer shall file a claim for payment for OSB production during the preceding three calendar months. An eligible OSB producer that files a claim under this subdivision shall include a statement of the eligible producer's total board feet of OSB produced during the quarter covered by the claim. For each claim and statement of total board feet of OSB filed under this subdivision, the board feet of OSB produced must be examined by a certified public accounting firm with a valid permit to practice under chapter 326A, in accordance with Statements on Standards for Attestation Engagements established by the American Institute of Certified Public Accountants.

(b) The commissioner must issue payments by November 15, February 15, May 15, and August 15. A separate payment must be made for each claim filed.

Subd. 6.

Appropriation.

(a) In fiscal year 2025, a sum sufficient to make the payments required by this section, not to exceed $1,500,000, is appropriated from the general fund to the commissioner. This is a onetime appropriation.

(b) From fiscal year 2026 through fiscal year 2034, a sum sufficient to make the payments required by this section, not to exceed $3,000,000 in a fiscal year, is annually appropriated from the general fund to the commissioner.

223.17 LICENSES; BONDING; CLAIMS; DISBURSEMENTS.

Subd. 4.

Bond.

(a) Except as provided in paragraphs (c) to (e), before a grain buyer's license is issued, the applicant for the license must file with the commissioner a bond in a penal sum prescribed by the commissioner but not less than the following amounts:

(1) $10,000 for grain buyers whose gross annual purchases are $100,000 or less;

(2) $20,000 for grain buyers whose gross annual purchases are more than $100,000 but not more than $750,000;

(3) $30,000 for grain buyers whose gross annual purchases are more than $750,000 but not more than $1,500,000;

(4) $40,000 for grain buyers whose gross annual purchases are more than $1,500,000 but not more than $3,000,000;

(5) $50,000 for grain buyers whose gross annual purchases are more than $3,000,000 but not more than $6,000,000;

(6) $70,000 for grain buyers whose gross annual purchases are more than $6,000,000 but not more than $12,000,000;

(7) $125,000 for grain buyers whose gross annual purchases are more than $12,000,000 but not more than $24,000,000; and

(8) $150,000 for grain buyers whose gross annual purchases exceed $24,000,000.

(b) The amount of the bond shall be based on the most recent gross annual grain purchase report of the grain buyer.

(c) A first-time applicant for a grain buyer's license shall file a $50,000 bond with the commissioner. This bond shall remain in effect for the first year of the license. Thereafter, the licensee shall comply with the applicable bonding requirements contained in paragraph (a), clauses (1) to (8).

(d) In lieu of the bond required by this subdivision the applicant may deposit with the commissioner of management and budget an irrevocable bank letter of credit as defined in section 336.5-102, in the same amount as would be required for a bond.

(e) A grain buyer who purchases grain immediately upon delivery solely with cash; a certified check; a cashier's check; or a postal, bank, or express money order is exempt from this subdivision if the grain buyer's gross annual purchases are $1,000,000 or less.

(f) Bonds must be continuous until canceled. To cancel a bond, a surety must provide 90 days' written notice of the bond's termination date to the licensee and the commissioner.

Subd. 8.

Bond disbursement.

(a) The bond required under subdivision 4 shall provide for payment of loss caused by the grain buyer's failure to pay, upon the owner's demand, the purchase price of grain sold to the grain buyer in the manner provided by subdivision 5, including loss caused by failure to pay within the time required. The bond shall be conditioned upon the grain buyer being duly licensed as provided herein.

(b) The commissioner shall promptly determine the validity of all claims filed and notify the claimants of the determination. An aggrieved party may appeal the commissioner's determination by requesting, within 15 days, that the commissioner initiate a contested case proceeding. In the absence of such a request, or following the issuance of a final order in a contested case, the surety company shall issue payment promptly to those claimants entitled to payment. The commissioner may apply to the district court for an order appointing a trustee or receiver to manage and supervise the operations of the grain buyer in default. The commissioner may participate in any resulting court proceeding as an interested party.

(c) If a grain buyer has become liable to more than one producer by reason of breaches of the conditions of the bond and the amount of the bond is insufficient to pay the entire liability to all producers entitled to the protection of the bond, the proceeds of the bond shall be apportioned among the bona fide claimants.

(d) The bond shall not be cumulative from one licensing period to the next. The maximum liability of the bond shall be its face value for the licensing period.

(e) The bond disbursement shall occur 200 days from the date the commissioner publishes a public notice of a claim. At the end of this time period, the commissioner shall initiate bond payments on all valid claims received by the commissioner.

232.22 LICENSES, BONDING CLAIMS, DISBURSEMENTS.

Subd. 4.

Bonding.

(a) Before a license is issued, except as provided under paragraph (c), the applicant for a public grain warehouse operator's license shall file with the commissioner a bond in a penal sum prescribed by the commissioner based on the annual average storage liability as stated on the statement of grain in storage report or on the gross annual grain purchase report, whichever is greater, and applying the following amounts:

(1) $10,000 for storages with annual average storage liability of more than $0 but not more than $25,000;

(2) $20,000 for storages with annual average storage liability of more than $25,001 but not more than $50,000;

(3) $30,000 for storages with annual average storage liability of more than $50,001 but not more than $75,000;

(4) $50,000 for storages with annual average storage liability of more than $75,001 but not more than $100,000;

(5) $75,000 for storages with annual average storage liability of more than $100,001 but not more than $200,000;

(6) $125,000 for storages with annual average storage liability of more than $200,001 but not more than $300,000;

(7) $175,000 for storages with annual average storage liability of more than $300,001 but not more than $400,000;

(8) $225,000 for storages with annual average storage liability of more than $400,001 but not more than $500,000;

(9) $275,000 for storages with annual average storage liability of more than $500,001 but not more than $600,000;

(10) $325,000 for storages with annual average storage liability of more than $600,001 but not more than $700,000;

(11) $375,000 for storages with annual average storage liability of more than $700,001 but not more than $800,000;

(12) $425,000 for storages with annual average storage liability of more than $800,001 but not more than $900,000;

(13) $475,000 for storages with annual average storage liability of more than $900,001 but not more than $1,000,000; and

(14) $500,000 for storages with annual average storage liability of more than $1,000,000.

(b) Bonds must be continuous until canceled. To cancel a bond, a surety must provide 90 days' written notice of the bond's termination date to the licensee and the commissioner.

(c) In lieu of the bond required by this subdivision, the applicant may deposit with the commissioner of management and budget an irrevocable bank letter of credit as defined in section 336.5-102, in the same amount as would be required for a bond.

Subd. 6.

Bond claims.

A person claiming to be damaged by a breach of the conditions of a bond of a licensed public grain warehouse operator may file a written claim with the commissioner stating the facts constituting the claim. The claim must be filed with the commissioner within 180 days of the breach of the conditions of the bond. If the commissioner has reason to believe that a claim is valid, the commissioner may immediately suspend the license of the public grain warehouse operator and the licensee must surrender the license to the commissioner. Within 15 days the licensee may request an administrative hearing subject to chapter 14 to determine whether the license should be revoked. If no request is made within 15 days the commissioner shall revoke the license.

Subd. 6a.

Bond determinations.

If a public grain warehouse operator is licensed under both this chapter and chapter 223, the warehouse shall have its bond determined by its gross annual grain purchase amount or its annual average grain storage value, whichever is greater. For those entities licensed under this chapter and chapter 223, the entire bond shall be available to any claims against the bond for claims filed under this chapter and chapter 223.

Subd. 7.

Bond disbursement.

(a) The bond of a public grain warehouse operator must be conditioned that the public grain warehouse operator issuing a grain warehouse receipt is liable to the depositor for the delivery of the kind, grade and net quantity of grain called for by the receipt.

(b) Upon notification of default, the commissioner shall determine the validity of all claims and notify all parties having filed claims. Any aggrieved party may appeal the commissioner's determination by requesting, within 15 days, that the commissioner initiate a contested case proceeding. In the absence of such a request, or following the issuance of a final order in a contested case, the surety company shall issue payment to those claimants entitled to payment. If the commissioner determines it is necessary, the commissioner may apply to the district court for an order appointing a trustee or receiver to manage and supervise the operations of the grain warehouse operator in default. The commissioner may participate in any resulting court proceeding as an interested party.

(c) For the purpose of determining the amount of bond disbursement against all valid claims under a condition one bond, all grain owned or stored in the public grain warehouse shall be sold and the combined proceeds deposited in a special fund. Payment shall be made from the special fund satisfying the valid claims of grain warehouse receipt holders.

(d) If a public grain warehouse operator has become liable to more than one depositor or producer by reason of breaches of the conditions of the bond and the amount of the bond is insufficient to pay, beyond the proceeds of the special fund, the entire liability to all valid claimants, the proceeds of the bond and special fund shall be apportioned among the valid claimants on a pro rata basis.

(e) A bond is not cumulative from one licensing period to the next. The maximum liability of the bond shall be its face value for the licensing period.

(f) The bond disbursement shall occur 200 days from the date the commissioner publishes a public notice of a claim. At the end of this time period, the commissioner shall initiate bond payments on all valid claims received by the department.