HCS SCS SB 156 -- AGRICULTURE

SPONSOR:  Engler (Quinn, 7)

COMMITTEE ACTION:  Voted "do pass" by the Committee on
Agriculture Policy by a vote of 10 to 0.

This substitute changes the laws regarding agriculture.

LARGE ANIMAL VETERINARY STUDENT LOAN ASSISTANCE

The administration of the Large Animal Veterinary Medicine Loan
Repayment Program is transferred from the Missouri Veterinary
Medical Board to the Department of Agriculture.  The maximum
number of veterinarians to whom loan repayments can be granted
each year is increased from five to six, the required number of
years of service in an area of defined need to satisfy the loan
repayment requirement is reduced from five to four, and the
maximum service loan repayment amount per year is increased from
$10,000 to $20,000.

The Large Animal Veterinary Student Loan Program is established
to provide up to six loans yearly to veterinary students
attending the College of Veterinary Medicine at the University of
Missouri-Columbia.  No student can receive more than $80,000 in
loans.  Veterinary students agreeing to locate their practice in
department-identified, under-served areas of the state will have
certain amounts of their loan principal and interest forgiven.

The department director will appoint an advisory panel to make
recommendations regarding the administration of the programs.
The panel will consist of three licensed veterinarians, the Dean
of the College of Veterinary Medicine, and a public member
representing agricultural interests.

The Large Animal Veterinary Student Loan Payment Fund is created
consisting of appropriations from general revenue and donations.
Moneys in the fund will be used for student loans and
administrative expenses incurred by the department.

AGRICULTURAL TAX CREDITS

The definition of "agricultural tax credits" administered by the
Missouri Agriculture and Small Business Development Authority is
revised to include family farm breeding livestock loan tax
credits created under the Tax Credit Accountability Act of 2004,
and certain types of agricultural production facilities must be
located in Missouri to qualify its producer member for
agricultural tax credits.

AGRIMISSOURI MARKETING PROGRAM

The substitute renames the Marketing Division within the
Department of Agriculture as the Agriculture Business Development
Division, the Marketing Development Fund as the Agriculture
Business Development Fund, the Missouri Agricultural Products
Marketing Development Fund as the AgriMissouri Fund, and the
Citizens' Advisory Commission as the AgriMissouri Advisory
Commission.

QUALIFIED BIO-MASS

Qualified bio-mass is added to the list of Missouri agricultural
products that can be used in the production of fuel ethanol by
Missouri qualified fuel ethanol producers.  Beginning January 1,
2008, through December 31, 2018, Missouri qualified fuel ethanol
producers producing fuel ethanol from qualified bio-mass will be
eligible to receive grants from the department.  The total amount
of the grants is not to exceed $10 million per year.

STATE AND LOCAL SALES AND USE TAX EXEMPTION FOR AGRICULTURAL
FENCING, TRAILERS MANUFACTURED IN MISSOURI, AND MOTOR FUEL

A state and local sales and use tax exemption is authorized for
fencing materials, trailers manufactured in Missouri, and motor
fuel used for agricultural purposes.

STATE FAIR ESCROW FUND

The State Fair Escrow Fund, which will be maintained by the State
Fair Commission, is created.  All ticket sales from the Missouri
State Fair and any off-season event will be deposited into the
fund as well as gifts, grants, contributions, and funds or
benefits from any other source.  Moneys in the fund may be used
for the costs associated with the fair or any off-season event
and may include expenses and equipment.

The fund will be under the direct control of the State Fair
Director and the State Fair Commission.  Moneys in the fund will
be used for the purposes specified in the substitute and will not
revert or be transferred to general revenue.

NOXIOUS WEEDS

The substitute adds spotted knapweed and sericea lespedeza to the
definition of "noxious weed" and specifies that the noxious weed
control laws are applicable to both varieties of weeds.

MISSOURI ALTERNATIVE FUELS COMMISSION

The substitute renames the Missouri Ethanol and Other Renewable
Fuel Sources Commission to the Missouri Alternative Fuels
Commission and expands its membership from seven to nine.  The
two additional members will be appointed by the Governor.  The
five Governor-appointed members must be engaged in the production
and sale of alternative fuels.  The commission will:

(1)  Make recommendations on legislation to facilitate the sale
and distribution of alternative fuels and alternative fuel
vehicles;

(2)  Promote the production and use of alternative fuels;

(3)  Promote the development and use of alternative fuel vehicles
and other related technology;

(4)  Educate consumers about alternative fuels;

(5)  Develop a long-range plan to reduce petroleum fuel use; and

(6)  Report annually to the Governor and General Assembly.

MANAGED ENVIRONMENT LIVESTOCK OPERATION TAX CREDITS

The Missouri Agriculture and Small Business Development Authority
is authorized to issue tax credits to owners of livestock
operations to partially offset certain expenses incurred for
implementing odor abatement best management practices and
systems.  The maximum tax credit amount for implementing a system
necessary to achieve managed environment livestock operation
(MELO) accreditation and/or improving basic infrastructure to
increase the setback from the property line will be the lessor of
50% of the eligible expenses or $50,000.  The maximum tax credit
amount for implementing a system necessary to meet preferred
environmental practices and/or improving basic infrastructure to
increase the setback from the property line will be the lessor of
75% of the eligible expenses or $75,000.  The yearly maximum
amount of tax credits issued by the authority for odor abatement
will be $3 million.  The tax credits may be carried back three
years, forward five years, assigned, transferred, or sold and may
be taken against the estimated quarterly tax or quarterly taxes.

The authority is required to establish rules for tax credit
eligibility based on odor abatement impact, the owner's
prospective use and funding of proven technologies, and other
factors that the authority considers necessary.  Ninety percent
of the tax credits issued in any one year will go to livestock
operation owners for the implementation of best management
practices and systems necessary to achieve MELO accreditation.
Ten percent and any remaining MELO tax credits will be issued to
livestock operation owners for the implementation of preferred
environmental practices.  Any unissued tax credits will not carry
over to the succeeding year.  The authority will impose an
application fee of .25% of the tax credit amount issued.

MISSOURI AGRICULTURE AND SMALL BUSINESS DEVELOPMENT AUTHORITY

Currently, agricultural tax credits are not to exceed $6 million
in any fiscal year.  The substitute increases the amount to $12
million.

The Missouri Agriculture and Small Business Development Authority
is allowed to issue up to $1 million in agricultural product
utilization tax credits in any fiscal year to individuals
contributing cash funds to the authority.  The funds are to be
used for financial or technical assistance to rural agricultural
business concepts approved by the authority.

Subject to appropriations, the authority must pay the first year
of charged interest payments on all linked deposit loans used for
the acquisition of dairy cows.  The authority is authorized to
charge a service fee, not to exceed $50, to defray the
administrative costs of processing a loan.

The authority is required to develop and implement dairy business
planning grants.  The total amount of the grants will not exceed
$50,000; and no single grant can exceed $5,000.  An application
fee may be charged, not to exceed $50 per grant application, to
defray the administrative costs of administering the grant.

The applicant's dairy operation must be located in Missouri and
at least 51% owned by Missouri residents.  The grant proceeds
must be used solely to contract with a dairy business planning
professional approved by the authority.  The authority is
required to establish rules on eligibility and award criteria
including improved profitability, modernization, and expansion of
the dairy operation.  The experience, education, and relevant
dairy experience of both the grant applicant and the dairy
business planning professional are required to be part of the
respective selection criteria.

MISSOURI QUALIFIED BIODIESEL PRODUCERS

Currently, a biodiesel producer incentive grant is calculated
based on the estimated number of gallons of biodiesel produced
from Missouri agricultural products.  The substitute removes the
instate or Missouri agricultural product origin requirement of at
least 51% Missouri producer owned for a renewable fuel production
facility to be eligible for the grant.

LIQUOR AND WINE TASTING

Wineries, distillers, manufacturers, wholesalers, or brewers are
allowed to provide samples for customer tasting purposes at
retail licensed premises that have a special permit or a by-the-
drink-for-consumption-on-the-premises-where-sold retail license.
The winery, distiller, manufacturer, wholesaler, or brewer cannot
give money or anything of value to the retailer for the
opportunity to conduct the tasting.  Tastings may be conducted
off of retail licensed premises if no sales transactions take
place, but solicitations for later sales via promotional
materials are allowed.

FAMILY FARM LIVESTOCK LOAN PROGRAM

The substitute increases from $150,000 to $1 million the maximum
amount of tax credits that the Missouri Agricultural and Small
Business Development Authority is authorized to issue annually to
eligible lenders participating in the Family Farm Livestock Loan
Program.

RICE CERTIFICATION ACT

The Rice Certification Act is established which prohibits the
production, transporting, or handling of certain rice varieties
except as provided by the department.

The Rice Certification Committee is established which will
consist of nine members including the department director; two
members appointed by the department director to represent rice
handlers and end rice users; and six members recommended by the
Missouri Rice Research and Merchandising Council representing
rice producers, university scientists, rice mills operators, and
rice seed dealers.  The committee must:

(1)  Identify rice varieties with characteristics of commercial
impact;

(2)  Develop rules to be established by the department regarding
the production and handling of rice varieties with
characteristics of commercial impact;

(3)  Review rice identity preservation programs;

(4)  Review at least every two years or upon receipt of a
petition from the supplier of the rice each rice variety having
characteristics of commercial impact;

(5)  Review, approve, and make recommendations on any rules and
policies developed by the department relating to rice; and

(6)  Make recommendations to the department director on all
matters regarding the enforcement of the act.

The department is required to establish rules:

(1)  Preventing the contamination of rice that has not been
identified as having characteristics of commercial impact;

(2)  Requiring certain notifications for producers, transporters,
and receivers of rice with characteristics of commercial impact;

(3)  Enforcing restrictions on rice with characteristics of
commercial impact;

(4)  Investigating alleged violations, issuing written notices of
violation, and imposing penalties for violations; and

(5)  Encouraging research and development of new types of rice.

Any violation of these provisions will be subject to a fine of at
least $10,000 but not more than $100,000 per day per violation.

The provisions of the substitute regarding the managed
environment livestock operation tax credit will expire June 30,
2012.

The provisions regarding the Rice Certification Act become
effective 180 days after the effective date of the substitute.

The provisions of the substitute regarding the state and local
sales and use tax exemption on fencing materials contain an
emergency clause.

FISCAL NOTE:  Estimated Effect on General Revenue Fund of an
income of $1,783,293 to a cost of $7,266,707 in FY 2008, an
income of $3,944,541 to a cost of $5,105,459 in FY 2009, and an
income of $3,836,294 to a cost of $5,213,706 in FY 2010.  No
impact on Other State Funds in FY 2008, FY 2009, and FY 2010.

PROPONENTS:  Supporters say that the changes to and renaming of
the Missouri Alternative Fuels Commission was recommended by the
Missouri Energy Task Force.  The expansion of the commission
allows representation from suppliers and distributors of energy.

Testifying for the bill were Senator Engler; and Missouri
Petroleum Marketers and Convenience Store Association.

OPPONENTS:  There was no opposition voiced to the committee.

Missouri House of Representatives
94th General Assembly, 1st Regular Session
Last Updated July 25, 2007 at 11:21 am