HF4963

Purpose

This bill expands and reshapes Minnesota’s Agricultural Growth, Research, and Innovation (AGRI) program and related agricultural funding. Its overall aim is to broaden support for dairy, farm businesses, new farming practices, and farm-based economic development, while also adding programs focused on mental health, local foods, biofuels, urban agriculture, and farm-to-institution efforts (such as school meals). It sets new funding levels and describes how the funds can be used to help farmers, farm workers, processors, and rural communities grow, modernize, or start new activities.

Main Provisions

• AGRI program funding and eligible uses

  • Increases overall funding for the Agricultural Growth and Innovation program (AGRI) and details where it can be spent.
  • Eligible activities include:
  • Startup, modernization, or expansion of livestock operations (with a preference for robotic milking equipment).
  • Value-added agricultural businesses expanding to new markets and opportunities (including aquaponics); hemp fiber processing equipment is specifically called out.
  • Loans to help beginning and transitioning farms (under existing loan authorities).
  • On-farm research and demonstrations for sustainable agriculture.
  • Development or expansion of food hubs and other community-based food distribution systems.
  • Renewable energy infrastructure and use.
  • Crop research (including turf seed research).
  • Farm Business Management tuition assistance.
  • Commercialization of innovations using agricultural byproducts to support new materials (e.g., fiber-based barrier packaging) to reduce PFAS and plastics in packaging.
  • Certification and practices support for good agricultural practices and good handling practices.
  • Administrative cost allowance: up to 7.5% of the AGRI appropriation may be used for program administration.

• Dairy, organic certification, and related supports

  • Continuation and funding for the dairy development and profitability program (including dairy profitability teams and dairy business planning grants).
  • Cost-sharing for organic certification for farmers or businesses that sell/process/package Minnesota agricultural products.

• Mental health, safety, and farm community supports

  • Funds for mental health outreach and support for farmers, ranchers, farm workers, and others in the agricultural community, plus farm and farm worker safety grants and outreach.
  • Mental health efforts may include a 24-hour hotline, stigma reduction, and education.

• Local and regional sourcing, and food access

  • Local food purchasing assistance grants to support locally sourced food in Minnesota.
  • On-farm or local infrastructure supporting farm-to-institution programs and similar school/early childhood food procurement efforts.
  • A statewide Farm-to-Institution coordinator to assist participating farmers and grant recipients.

• Biofuels and energy-related incentives

  • Grants to help biofuels infrastructure: upgrades or replacements for dispensers to handle certified biofuel blends (with caps, cost-share limits, and reporting). Grants target stations with up to 20 sites and a maximum per-station grant.
  • Reporting requirements to track how funds are used, project types, geographic distribution, market expansion, and demographics (including minority- and women-owned grant recipients).

• Meat, poultry, egg, and dairy processing facilities

  • Grants to facilitate startup, modernization, or expansion of processing facilities for meat, poultry, eggs, and milk.

• Urban agriculture and community development

  • Grants to support urban agriculture projects, including youth education, community and economic development, value-added processing, and vocational training.

• Cooperative development and livestock protections

  • Grants for cooperative development to support agriculture, horticulture, rural economic development, and related marketing/promotion/research/education efforts.
  • A Protecting Livestock Grant program to help producers install measures to prevent the transmission of avian influenza (cost-share requirement of 20%).

• AGRI Works grants (one-time)

  • A one-time set of AGRI Works grants to institutions and organizations for regional and statewide services, favoring groups that help agricultural and rural economic development, marketing, and education.

• Other program timing, carryover, and reporting

  • Some appropriations are structured to not cancel at the end of the first or second year and remain available into later years (through 2029 or 2032 for certain AGRI-related funds).
  • In the event money from canceled contracts exists, priorities are set to use that money for AGRI Works grants.

Significant Changes to Existing Law

• Broader eligibility and funding

  • Expands and clarifies the scope of the AGRI program, allowing a wider array of agricultural development activities and investments (including robotics for dairy milking, hemp processing, aquaponics, on-farm research, and packaging innovations to reduce PFAS).
  • Increases base appropriations for several related programs (dairy, local foods, school meal support, and county fairs), and establishes new or expanded funding lines for mental health, farm safety, and urban/agri-urban initiatives.

• Administrative and reporting changes

  • Allows a portion of AGRI funding to be used for program administration (up to 7.5%).
  • Requires annual reporting on biofuels grants (projects financed, dollars leveraged, geographic distribution, market impact, demographics, costs, and minority/female ownership shares).

• Funding continuity and sunset rules

  • Several appropriations are structured to carry over or extend beyond the initial two-year period, with specified end dates for encumbrances and a framework to prioritize funds from canceled contracts for related grants.

Beneficiaries and Impacts

• Farmers, ranchers, and farm workers across Minnesota who are starting, upgrading, or expanding dairy, livestock, crop, and value-added processing operations.
• Organic producers seeking cost-sharing for certification.
• Rural communities and urban areas benefiting from local food purchasing, food hubs, and urban agriculture projects.
• Schools, early childhood programs, and child care providers receiving more fruits, vegetables, dairy, and other farm products.
• Women- and minority-owned ag businesses and cooperatives receiving grant opportunities.
• Industry stakeholders and communities involved in biofuels infrastructure, renewable energy, and packaging innovations aimed at PFAS reduction.

Relevant Terms - Agricultural Growth, Research and Innovation (AGRI) program - Dairy development and profitability program - Organic certification cost-sharing - Mental health outreach and farmworker safety - Local food purchasing assistance - On-farm research and sustainable agriculture - Food hubs and community-based food distribution - Beginning and transitioning farms - Robotic milking equipment - Aquaponics - Hemp fiber processing - Renewable energy infrastructure - PFAS reduction and fiber-based barrier packaging - Farm Business Management tuition assistance - Biofuels infrastructure grants - E25 and biofuel replacement goals - Meat, poultry, egg, and milk processing facility grants - Farm-to-institution / farm-to-school - Statewide farm-to-institution coordinator - Urban agriculture grants - Cooperative development grants - AGRI Works grants - Protecting Livestock grant (avian influenza) - County fairs funding and incentive payments - Encumbrance carryover and grant reporting - Minnesota Statutes references (e.g., 41A.12, 41B.056, 17.1016, 17.1017, 239.7911)

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