Interim Joint Committee on Agriculture


Minutes of the<MeetNo1> 6th Meeting

of the 2012 Interim


<MeetMDY1> November 14, 2012


Call to Order and Roll Call

The<MeetNo2> 6th meeting of the Interim Joint Committee on Agriculture was held on<Day> Wednesday,<MeetMDY2> November 14, 2012, at<MeetTime> 1:00 PM, in<Room> Room 171 of the Capitol Annex. Senator David Givens, Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator David Givens, Co-Chair; Representative Tom McKee, Co-Chair; Senators Joe Bowen, Paul Hornback, Vernie McGaha, Dennis Parrett, Joey Pendleton, Damon Thayer, Robin L. Webb, and Ken Winters; Representatives Royce W. Adams, Johnny Bell, John "Bam" Carney, Mike Cherry, Mike Denham, Myron Dossett, C.B. Embry Jr., Kim King, Michael Meredith, Terry Mills, Brad Montell, David Osborne, Sannie Overly, Ryan Quarles, Tom Riner, Bart Rowland, Steven Rudy, Wilson Stone, Tommy Turner, and Susan Westrom.


Guests: Mr. Roger Thomas, Executive Director, Governorís Office of Agricultural Policy; Commissioner James R. Comer, Kentucky Department of Agriculture; Mr. Mark Haney, President, Kentucky Farm Bureau; Cassia Heron, Carolyn Gahn, and Mike Lewis, Community Farm Alliance, and Dr. Teferi Tsegaye, Dean, College of Agriculture, Kentucky State University.


LRC Staff: Tanya Monsanto, Lowell Atchley, Kelly Ludwig, and Susan Spoonamore, Committee Assistant.


The October 10, 2012 minutes were approved, without objection, by voice vote upon motion made by Senator Webb and second by Representative Embry.


The Subcommittee Report on Rural Issues was approved, without objection, by voice vote upon motion made by Senator Winters and seconded by Representative Denham.


The Subcommittee Report on Horse Farming was approved, without objection, by voice vote upon motion made by Senator Thayer and seconded by Representative Westrom.


Legislative Issues for 2013 Session:


Governorís Office of Agriculture Policy

Mr. Roger Thomas, Executive Director, Governorís Office of Agriculture Policy (GOAP) stated that GOAP did not have specific legislation for the 2013 Session. He discussed Master Settlement funding and GOAP initiatives. Kentucky will start seeing a decrease in Master Settlement Agreement (MSA) funds from $115 million to approximately $90 million. GOAP hopes some of the debt service obligations can be shifted from the Master Settlement Agreement Fund back to the General Fund. Fifty percent of MSA funds go to the rural development fund and the other fifty percent to early childhood and healthcare initiatives. As a result of the decrease in MSA funding, both initiatives will have less money to work with. He also updated the committee on the MSA arbitration hearings. Kentuckyís hearing will take place from May 23 through May 28, 2013, and it is hoped that Kentucky is in a good position of presenting evidence that it enforced the 2003 model statute to ensure that participating manufacturers were not put at a competitive disadvantage when the MSA was signed in 1998.


Mr. Thomas said the Agriculture Development Board agrees that water may become the next oil resource for Kentucky. The board approved two projects: working with the U.S. Geological Survey; and testing Kentuckyís water quality.


Mr. Thomas said it was anticipated that funding would be available for the Kentucky Proud program, Kentucky Beef Network, Kentucky Dairy Development Council, and the Kentucky Horticulture Council. GOAP was working with the poultry, pork, and beef producers promoting their products through the Kentucky Broadcasters Association, using recycled agriculture development funds. There will be a continuing need for investing in agriculture.


In response to Senator Givensí question, Mr. Thomas explained that the MSA hearings should conclude at the end of 2013. It will be up to the Court to decide whether a deal between the states and the participating manufacturers is to be negotiated. The exact amount that Kentucky stands to receive, depending on the courtís decision, is estimated to be approximately $40 million.


In response to Representative McKee, Mr. Thomas said that the demand for tobacco this year is very strong. Unfortunately, the demand for Kentucky tobacco is due to the sale of cigarettes out of the country. The MSA and payments to the states are based upon domestic sales.


Kentucky Department of Agriculture

Commissioner James R. Comer, Kentucky Department of Agriculture, stated that industrial hemp legislation would be a priority for the Department. He is the newly elected Chairman of the Kentucky Hemp Commission, and is submitting a report to the Agriculture Committee as required by statute. Other legislative issues requiring minor changes include the county fair program, livestock shows, and dairy shows (lowering the number of head of cattle required to have a breed show). Regarding Amusement Rides, the department would like changes made to existing statutory language requiring fines against a company or person to follow the individual. Minor changes also need to be made to the grain regulation. The department needs language clarifying the price of fuel at the pump versus the fuel retailersí street sign. The department would support a farm family tax credit, and it also supports the horse industry and its importance to Kentucky.


In response to Senator Givens, Commissioner Comer said that the department is in the process of purging names from the Kentucky Proud register who have not met the requirements to be labeled Kentucky Proud. The department is working to label milk from Kentucky as Kentucky Proud, but it is a tedious process. The department is working with milk processors to get Kentucky Proud milk into stores such as Wal-Mart.


In response to Senator Pendleton, Commissioner Comer said fuel is tested at the retail outlet. If changes are needed to fuel regulations, the department is open to discussions for expanding tests to other sources.


In response to Senator Givens, Commissioner Comer said that if a retailer calls the department about the quality of fuel coming into a facility, the department has the authority to test the product before it is unloaded.


Kentucky Farm Bureau

Mr. Mark Haney, President, Kentucky Farm Bureau (KFB) stated that the issues that have gotten the most attention from the members of KFB are tax modernization, sales and usage taxes, property taxes, and farm tax exemptions. KFB believes that a broad-based sales and use tax is the best way to finance state government. Wildlife management is very important to Kentucky Farm Bureau Insurance (KFBI). In 2011, KFBI received approximately 7,200 claims worth more than $23 million in accidents caused by deer. KFB supports the importance of Kentuckyís water quality. Kentucky needs to consider the impoundment of water to assist farmers in the growing of crops.


Representative Stone and Senator Webb encouraged KFB to monitor proposed federal regulation regarding water quality and its effects on agriculture in Kentucky.


Community Farm Alliance

Cassia Heron, President, Community Farm Alliance, and Carolyn Gahn, and Mike Lewis, Community Farm Alliance Young Farmers, spoke on behalf of the Community Farm Alliance (CFA). Ms. Heron explained that Community Farm Alliance (CFA) is a farmer based organization with a membership representing several different groups of people. Its mission is to build democracy and create good public policy. CFA was established to help marketing development. It is active in supporting local and community based projects such as farmersí markets, farm to school projects, and small business development. CFA has been involved in addressing Kentuckyís nutrition issues and encourages the study of how the food and nutrient programs are administered in by looking to see if the programs are actually increasing food access and providing solid markets for farmers.


Carolyn Gahn explained that it had been a struggle as a beginning farmer. CFAís Agriculture Legacy Initiative has helped to connect with other beginning farmers. There are five specific needs of beginning farmers: access to land, reliable markets, support resources, community with mentorship, and holistic support systems. House Bill 391 should include a provision and expansion to include non-farming entrepreneurs, along with a better definition of oversight and enforcement. Eastern Kentuckyís beginning farmers are among the fastest growing groups in Agriculture Legacy, but they have very few resources because eastern Kentucky is not dependent upon tobacco per the stipulations in House Bill 611.


Mike Lewis said he and his family farm in Rockcastle County, and he is president of the Bereaís farmersí market and is a disabled veteran. In cooperation with the Rockcastle County Industrial Development Authority, he is working towards developing a cooperative food hub for the distribution of local farm products. There is a critical need for market support, particularly staff. There are not enough farmers to meet market demands. With the support of the Farmer Veteran Coalition and Berea Collegeís, Grow Appalachia program, CFA is sponsoring the Veteranís Agriculture project as a model to support new and beginning veteran farmers. He is proud to be working with KDA and USA Cares on the new Kentucky Proud jobs for veterans program as well as the creation of the Homegrown by Heroes brand.


In response to Senator Givens, Mr. Lewis stated that the farmer veteran coalition is a national organization that works with veterans across the country to help them pursue careers in agriculture. The Homegrown by Heroes brand, through the Kentucky Department of Agriculture, is a labeling process to recognize veteran farmers who grow and produce a product.


Kentucky State University

Dr. Teferi Tsegaye, Dean and Director of Land Grant Programs, Kentucky State University, gave a brief update on the College of Agriculture. The land grant mission covers three areas: academic, research, and extension. KSUís aquaculture program is still listed in the top 5 nationally, and the organic farming program is ranked in the top 20. Kentucky State University is in the process of becoming more visible in all 120 counties, as well as nationally and abroad. Dr. Tsegaye announced that two of KSUís staff members would be deployed to Afghanistan to assist the National Guard.


There being no further business, the meeting adjourned.