HCS SCS SB 942 -- AGRICULTURE

SPONSOR:  Clemens (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 substitute changes the laws regarding the Large Animal
Veterinary Medicine Loan Repayment Program and the Large Animal
Veterinary Student Loan Program.  The substitute:

(1)  Adds lawful permanent residency in the United States to the
criteria for a student to be eligible to participate in the Large
Animal Veterinary Medicine Loan Repayment Program;

(2)  Specifies that up to six qualifying veterinarian students
can be awarded a maximum of $20,000 per academic year up to a
cumulative total of $80,000 with priority given to eligible
students who have established financial need;

(3)  Specifies that the maximum amount the Department of
Agriculture can forgive for each year of qualifying service is
$20,000;

(4)  Requires a loan recipient who fails to meet the qualified
service requirement to begin repayment of the loan within six
months of the first day on which he or she did not meet the
service requirement; and

(5)  Authorizes the department to grant a loan deferment to a
student who is on active duty in any branch of the armed forces
of the United States.

MANAGED ENVIRONMENT LIVESTOCK OPERATION TAX CREDITS

Beginning January 1, 2008, the substitute authorizes a tax credit
to owners of livestock operations for the eligible costs of
implementing odor abatement best management practices and systems
as administered through the Missouri Agricultural and Small
Business Development Authority.  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, carried forward five
years, transferred, or 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 deems necessary.  Ninety percent of
the tax credits issued in any 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.

AGRICULTURAL TAX CREDITS

The definition of "agricultural tax credits" as it relates to the
Missouri Agricultural and Small Business Development Authority is
revised to include family farm breeding livestock loan tax
credits and qualified beef tax credits and makes them subject to
the reporting requirements under the Tax Credit Accountability
Act of 2004.  The substitute increases from $150,000 to $300,000
the maximum amount of tax credits that the authority is
authorized to issue annually to eligible lenders participating in
the Family Farm Livestock Loan Program.

The substitute also requires new generation cooperatives to
report under the act if the agricultural tax credit is issued as
a result of a producer member investing in the new generation
cooperative.  Certain types of agricultural production facilities
must be located in Missouri in order to qualify its producer
member for agricultural tax credits.

QUALIFIED BIOMASS

Beginning January 1, 2009, through December 31, 2019, Missouri
qualified fuel ethanol producers producing fuel ethanol from
qualified biomass will be eligible to receive grants from the
Department of Agriculture.  The aggregate amount of the grants is
not to exceed $10 million per year.

STATE AND LOCAL SALES AND USE TAX EXEMPTION FOR AGRICULTURAL
FENCING, FORESTRY EQUIPMENT, AND MOTOR FUEL

A state and local sales and use tax exemption is authorized for
fencing materials, forestry equipment, and motor fuel used for
agricultural purposes.

HAZARDOUS SUBSTANCES

The substitute specifies that when a hazardous substance release
occurs the person having control of the hazardous substance is
liable for the reasonable and necessary costs for the cleanup or
containment incurred by the political subdivision or volunteer
fire protection association providing the emergency services.  No
later than 60 days after completion of the hazardous substance
cleanup, the political subdivision or the emergency services
provider is required to furnish the liable person with an
itemized statement of all costs associated with the hazardous
substance release.  The statement of costs must include certain
explanations for why the costs were incurred.  A cleanup cost
statement may be appealed to the Director of the Department of
Natural Resources with the burden of proof on the political
subdivision or the emergency services provider.

NAME CHANGES

The Marketing Division within the Department of Agriculture is
renamed 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 for Marketing Missouri Agricultural Products
as the AgriMissouri Advisory Commission for Marketing Missouri
Agricultural Products.

ALTERNATIVE FUEL AND VEHICLE INCENTIVES

The substitute authorizes a tax credit, from January 1, 2009, to
December 31, 2011, for eligible applicants who install and
operate a qualified alternative fuel vehicle refueling station.
The credit may be claimed for any tax year in which the applicant
is constructing the station.  The credit will be the lesser of
$20,000 or 20% of the total direct costs for the purchase and
installation of any alternative fuel storage and dispensing
equipment.  The costs of purchasing land or an existing
alternative fuel vehicle refueling station or the construction or
purchase of a structure are not considered eligible costs.  The
total amount of tax credits which can be claimed cannot exceed $3
million in 2009, $2 million in 2010, and $1 million in 2011.  Tax
credits may be carried forward for two years and sold, but will
be forfeited if a tax credit recipient stops selling alternative
fuel.

An income tax deduction is authorized, beginning January 1, 2009,
for an individual who purchases a qualified hybrid vehicle.  The
tax deduction will be the lesser of $1,500 or 10% of the
vehicle's purchase price and must be claimed in the tax year in
which the vehicle is purchased.

NOXIOUS WEEDS

Persons, corporations, the Highways and Transportation
Commission, state departments, state agencies, county
commissions, township boards, school boards, drainage boards,
governing bodies of incorporated cities, railroad companies and
other transportation companies, and persons supervising
state-owned lands are required to control the spread of and
eradicate by methods approved by the federal Environmental
Protection Agency spotted knapweed (Centaurea stoebe ssp.
micranthos, including all subspecies), which are designated as
noxious and dangerous weeds to agriculture.

DAIRY COWS AND DAIRY OPERATIONS

Subject to appropriations, the Missouri Agricultural and Small
Business Development 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 aggregate 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
be 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.

LIVESTOCK FEED AND CROP INPUT LOAN GUARANTEE PROGRAM

The Missouri Agricultural and Small Business Development
Authority must provide assistance to independent livestock and
poultry family farm operations by implementing a livestock feed
and crop input loan guarantee program to grant partial loan
guarantees on loans for the purchase of livestock feed and crop
inputs to produce crops for feeding livestock.

The Livestock Feed and Crop Input Loan Guarantee Fund is created
consisting of moneys appropriated by the General Assembly;
bequests from federal, private, or other sources; and investment
income on the fund.  The General Assembly may appropriate up to
$4 million to the fund.  Qualified independent livestock and
poultry family farm operations may borrow up to $40,000.  The
authority provides a 50% first-loss guarantee, on a declining
principal basis, to local lenders and will charge a one-time
participation fee of $50 on the loan.  A special loan guarantee
fee of up to 1% per annum of the outstanding principal of the
loan may be charged by the lender and paid to the authority.

AUTOMOTIVE LUBRICANTS AND PETROLEUM PRODUCTS

Automotive lubricants are required to meet the American Society
for Testing and Materials (ASTM) current standards.  If no ASTM
standard exists for certain fuels and petroleum-based products,
the Department of Agriculture may adopt other generally
recognized national consensus standards by rule.

The department is authorized to regulate the posting of prices at
gas stations and convenience stores for fuels, petroleum
products, and automotive lubricants.

Currently, the penalty for a first violation of the product
standards or labeling and advertisement requirements for certain
fuels and petroleum products is not to exceed a written
reprimand.

The substitute also:

(1)  Requires dealers, distributors, producers, or compounders of
certain fuels and oils to immediately provide a sample upon a
department request;

(2)  Allows the department director to have access during
business hours to all places where automotive lubricants are
marketed;

(3)  Prohibits the storing or selling of automotive lubricants in
a deceptive manner;

(4)  Allows the directors of the departments of Agriculture and
Revenue, upon request, to have access to shipping records of
automotive lubricants as kept by common carriers and marketers of
fuels or petroleum products; and

(5)  Increases the maximum inspection fee on gasoline,
gasoline-alcohol blends, kerosene, diesel fuel, heating oil,
aviation turbine fuel, and other motor fuels from 2.5 cents per
barrel to three cents per barrel.

The Large Animal Veterinary Student Loan Program will expire
June 30, 2013; the provisions regarding the managed environment
livestock operation tax credits will expire August 28, 2011; and
the provisions regarding tax credits for alternative fuel vehicle
refueling stations will expire six years from the effective date.

FISCAL NOTE:  Estimated Cost on General Revenue Fund of Greater
than $3,170,000 in FY 2009, Greater than $1,282,825 to $3,782,825
in FY 2010, and Greater than $1,251,152 to $2,751,152 in FY 2011.
Estimated Cost on Other State Funds of Unknown in FY 2009, FY
2010, and FY 2011.

PROPONENTS:  Supporters say that the bill clarifies certain
provisions of the Large Animal Veterinary Medicine Loan Repayment
Program and the Large Animal Veterinary Student Loan Program.

Testifying for the bill were Senator Clemens; Richard Antweiler,
Missouri Veterinary Medical Association; Missouri Farm Bureau;
and Department of Agriculture.

OPPONENTS:  There was no opposition voiced to the committee.

Missouri House of Representatives
94th General Assembly, 2nd Regular Session
Last Updated October 15, 2008 at 3:13 pm