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During the past week activity at the Statehouse continued at a brisk pace as committee chairs made an effort to give hearings to a number of bills that had not yet been considered. Groups representing county Farm Bureaus continue to visit the Statehouse and, in addition to meeting with their elected representatives, give Farm Bureau an important regular visibility. On Friday morning the House released its version of the 2013-2015 biennial budget. The Farm Bureau staff has not had a chance to review it in detail but it will reportedly be good news for public education and local roads.  

If you have completed an action alert or communicated to your member of the Indiana General Assembly or Congress on a Farm Bureau issue, please report back to ppt@infarmbureau.org. This is great information on what Farm Bureau members are hearing from elected officials.

SOIL PRODUCTIVITY CORRECTION MOVING IN HOUSE  Following last week’s announcement by House Speaker Brian Bosma (R-Indianapolis) that SB 319 would be fast-tracked through the House, the House Ways & Means Committee heard and approved it on Monday morning. SB 319 was presented to the committee on Monday by its author, Sen. Jean Leising (R-Oldenburg), and House sponsors Reps. Don Lehe (R-Brookston) and Bob Cherry (R-Greenfield) and supported by Katrina Hall of Farm Bureau. The bill will retain the 2011 soil productivity factors for the 2013 assessment of farmland and direct the Department of Local Government Finance, in cooperation with the Purdue College of Agriculture, to develop and submit to the General Assembly recommendations and justifications for any proposed changes in the methodology used to establish soil productivity adjustments to the base value of farmland.

The House Rules state that there may be no more than three co-authors or co-sponsors of a bill. Occasionally, this rule is waived and additional co-sponsors are added to a bill. Rep. Cherry has obtained such a waiver from Speaker Bosma for SB 319 and by noon on Friday the bill had 66 sponsors and co-sponsors.

The bill passed second reading without amendment on Thursday and will be eligible for final action in the House next week.

BILL TO PROTECT AG AND INDUSTRIAL OPERATIONS FROM UNAUTHORIZED PHOTOGRAPHY MOVING IN SENATE  The Senate Corrections & Criminal Law Committee met on Tuesday and approved an amended version of SB 373, which will make it illegal to record an agricultural or industrial operation without the operator’s consent. The bill was amended by committee to reduce the penalty and add an exception for transferring the recording to appropriate law enforcement officials. The committee also discussed protecting an individual who transferred a recording to a media outlet. It is expected that an effort will be made to amend the bill on second reading. SB 373 was presented to the committee by its author, Sen. Travis Holdman (R-Markle), and supported by Farm Bureau’s Bob Kraft as well as Indiana Pork, the Indiana Poultry Association, Indiana Manufacturer’s Association and the Indiana Chamber of Commerce. It was opposed by the Humane Society of the United States, the Sierra Club, the Hoosier Press Association and several individuals.

PROPOSAL TO ELIMINATE PUBLIC HEARINGS ON LOCAL GOVERNMENT BUDGETS CONSIDERED   HB 1116 authored by Rep. Dan Leonard R-Huntington), makes numerous changes concerning the administration of property taxes. As presented to the committee, the bill would have required binding approval of a library’s budget by the fiscal body of a county or a city. Due to complaints by library officials, that portion of the bill was deleted. Katrina Hall testified against portions of the bill that eliminated DLGF budget hearings for next year, suggesting that this idea might have merit but it needs to be studied first so that the rights of taxpayers are preserved in the process that approves local budgets and sets property tax rates. The bill was held by the Government Reform & Regulatory Committee until next week.

ANOTHER PERSONAL PROPERTY TAX PROPOSAL GETS A HEARING  HB 1544  Rep. Eric Turner’s (R-Cicero) bill would permit a county, city or town to authorize a 100% property tax deduction for all personal property or, alternatively, to grant a tax credit for all property taxes imposed on all personal property in the county, city or town. The bill provides local government with additional flexibility when granting tax abatements. At the request of the Apartment Association, Turner included language that extends the 2% circuit breaker to common areas owned by apartment complexes. Katrina Hall testified in favor of the part of the bill which would give local officials the opportunity to act on personal property taxes, noting that this may not be something all counties could afford to do but it would be a start. She also noted that flexibility in tax abatements should extend to agricultural enterprises. The bill was amended to also allow personal property exemptions and credits at levels less than 100% and was voted out of the Ways & Means Committee on Thursday afternoon.
 
COMMERCIAL VEHICLE EXCISE ADMINISTRATION  Another bill introduced by Rep. Eric Turner (R-Cicero), HB 1546, makes a number of technical changes to various state taxes including the commercial vehicle excise tax (CVET). It makes permanent the registration of commercial trucks in fleets of 25 or more. Katrina Hall expressed concerns that because CVET has a revenue guarantee for local governments, any changes to the fees paid by fleets of trucks would make CVET paid by farmers higher. She was assured that the bill did not change any registration fees, but Indiana Farm Bureau will be watching this bill closely and urges members to remind legislators how high the CVET paid by farmers are already.

SENATE CONSIDERS DIRECTING PORTION OF GASOLINE SALES TAX TO ROAD MAINTENANCE  The Senate Fiscal Policy Committee considered but did not vote on SB 440, a bill introduced by Sen. Tim Skinner (D-Terre Haute) that would allow part of the sales tax collected on gasoline to be allocated among counties, cities and towns for road and street projects. It specifies that when the retail price of fuel, including federal fuel taxes and state fuel, sales, and use taxes, exceeds $3, the sales tax collected on the amount above $3 is distributed to counties, cities and towns. These dollars would be distributed on a quarterly basis and used for road construction and maintenance only. Katrina Hall supported the bill, stating that because the local road funding need is so great, there must be some state dollars provided especially to smaller counties that cannot raise enough of the wheel tax and motor vehicle surtax to make a substantial dent in their road maintenance problem.  

HOUSE COMMITTEE OKs SWAP OF FEDERAL HIGHWAY MONEY  The House Roads & Transportation Committee has approved HB 1067 (Rep. Bob Cherry, R-Greenfield), a bill that will establish a program to allow a county or municipality that receives funds from the Federal Surface Transportation program to exchange the federal funds for an equal amount of state funds. This program will allow the local unit and INDOT to exchange funds. This will provide the local unit more flexibility and reduce the federal paperwork burden by allowing INDOT to concentrate the expenditure of federal funds on fewer, larger projects. Wayne Dillman lobbied for Farm Bureau in support of the bill and explained to the committee that it is consistent with Farm Bureau policy.

FARM BUREAU SUPPORTS BILL TO PROTECT GAS CUSTOMERS FROM SUBSIDIZING SYNTHETIC NATURAL GAS  In the Senate Utilities Committee on Thursday, Bob Kraft testified in favor of SB 510 (Sen. Doug Eckerty, R-Yorktown), a bill to protect customers by mandating that losses and potential benefits be reconciled every three years rather than a single reconciliation at the end of 30 years. The bill addresses the potential of higher gas prices resulting from the construction of a synthetic natural gas (SNG) plant at Rockport in Spencer County. (Note: Last week’s Dispatch mistakenly placed the plant in a neighboring county.) Because of recent improvements in the technology for extracting natural gas, gas prices today are less than half of what they were when the Rockport project was approved in 2007. While it is impossible to predict how natural gas prices may fluctuate in the future, it is likely that they will remain below the cost of synthetic gas for at least the near future. If farmers and other gas customers are required to pay more for gas under the terms of the contracts between the state and Leucadia, the developer of the Rockport plant, Farm Bureau believes that those customers should be made whole on a regular three-year timetable. It should be noted that the contract between Leucadia and the Indiana Finance Authority has been voided by the Indiana Court of Appeals in litigation that is currently pending before the Indiana Supreme Court. Utilities Committee Chairman Jim Merritt (R-Indianapolis) announced before the hearing began that there would be no vote on Thursday but promised that a vote on the bill would be taken at the committee’s next meeting.

EPA RELEASES LIVESTOCK AND POULTRY FARM DATA  EPA has complied with two separate Freedom of Information Act (FOIA) requests for all records relating to the agency’s effort to collect data on livestock and poultry operations. Earthjustice made one request, while the other was a combined request from the Natural Resources Defense Council and Pew Charitable Trust. This request was made following a proposed rule and initiative by EPA to collect information related to livestock and poultry farms to aggregate it in one database. The information EPA turned over are all records provided by state regulators. EPA released the information in electronic format. Neither Indiana Farm Bureau nor AFBF has received the data so we do not know what information was released with respect to our members’ farms. We will provide more information once it is available. EPA expects to close out this FOIA request in the next few weeks. When it does, the information EPA provided will be available here. If you are interested in seeing what was provided, check this link regularly until the information is uploaded. 

FARM BUREAU STAFF MEETS WITH IDEM  Farm Bureau staff, along with representatives of Indiana Pork, the Indiana Soybean Alliance and Indiana Corn Growers Association, met with IDEM staff in an ongoing effort to push for clarification on the new livestock rules that affect our members. IDEM has committed to providing clarification to the rule interpretation and an ongoing dialogue with the agricultural organizations.

VILLWOCK TESTIFIES ON PURDUE BUDGET  On Wednesday this week, Farm Bureau President Don Villwock testified in support of the Purdue College of Agriculture’s request for funds for agricultural extension and research. Villwock emphasized that the ability of Indiana’s land grant university to remain a leader in the development of new farming practices and commodities was essential to the continued economic well-being of the state’s entire agricultural community.

FARM BILL  In Washington this week, staff from the offices of Senate Majority Leader Harry Reid (D-Nevada), Senate Budget Committee Chair Patty Murray (D-Washington) and Senate Ag Committee Chair Debbie Stabenow (D-Michigan) called in about 10 agricultural representatives to share Majority Leader Reid’s plan for sequestration. The leader is likely to drop a bill which will address the sequestration mandate by cutting spending and raising taxes by about a 50-50 split.

In agriculture, the bill will eliminate direct payments for 2014 through 2023. Direct payments for this calendar year (which are scheduled to be paid in October 2013) would remain intact.

Under this scenario, agriculture would contribute $27.5 billion in savings. While one might think eliminating direct payments would save $4.9 billion times 10 years or almost $50 billion, the Congressional Budget Office (CBO) will not score that much savings as it assumes that if there are no direct payments, participation in the ACRE program increases. So the total “saved” from eliminating direct payments for 10 years is $31 billion.

In addition, the livestock disaster packages and fruit and vegetable disaster packages that were not addressed in the farm bill extension on January 1 would be extended for 2013 and made retroactive for 2012. In total, 24 of the expiring 37 programs would be funded for some period of time under the Reid proposal. (Senate staff would not share with AFBF which of those programs would be extended and which would not.)

Under recently released CBO projections, the commodity title of the farm bill is projected to cost $64 billion but $58 billion is for the direct payment program, the ACRE program and marketing loans. The rest covers various other federal expenditures such as dairy, NAP (non-insured crop disaster assistance program), the tobacco trust fund and the cotton economic program.

If you look at the Reid package in comparison to the CBO score, the program commodities will go from $58 billion over the next 10 years to $27 billion. This will make writing a farm bill with an adequate safety net extremely challenging.

No other titles of the farm bill are scheduled to be cut in order to produce savings. In fact, some titles will get more funding as some of the 37 expiring provisions are funded. Passage is not likely given that many Republicans do not want to support anything that raises taxes, but the fact that they are willing to eliminate direct payments is a huge message.

Sen. Reid’s staff also reiterated twice that if this package does not pass and we have to look toward extending the farm bill again later this year, he will not support continuation of the direct payment program.
 
U.S. – EU TRADE NEGOTIATIONS  The launch of comprehensive trade negotiations between the United States and the European Union holds the promise of expanded market access and an improved, science-based regulatory approach for agriculture and food. Also encouraging is the fact that some long-standing issues hindering trade between the U.S. and the EU, such as sanitary standards for beef, have lately been addressed. However, a constant commitment to removing barriers to agricultural trade is necessary in order to achieve a worthwhile agreement for U.S. agriculture.
 
SOIL RECOVERY FROM DROUGHT  It could take two years or longer for crops and soil to recover from the extensive drought, according to Randall Miles, associate professor of soil science at the University of Missouri’s School of Natural Resources. Miles found that soil in the Midwest is dry down to as deep as five feet, which is the depth at which the roots of crops absorb moisture and nutrients. In most cases, 1 foot of soil holds 2 inches of water. This means that to recharge completely, fully depleted soil requires about 16 inches of water over and above normal precipitation amounts.

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