Agriculture and broadband funding, policy changes are among provisions in new law

A new law will appropriate $138.5 million from the General Fund for the 2026-27 biennium for agriculture-related purposes, including the Department of Agriculture, Board of Animal Health, Agricultural Utilization Research Institute and Broadband Development Office in the Department of Employment and Economic Development.

It also makes several policy changes, including raising grain buyers’ inspection and grain storage fees and establishing a new license for milk marketers.

Rep. Paul Anderson (R-Starbuck) and Sen. Aric Putnam (DFL-St. Cloud) sponsor the law that takes effect July 1, 2025, unless noted.

HF2446*/SF2458/CH34

Appropriations

The Department of Agriculture is to receive $114.2 million, a $49.3 million decrease from the 2024-25 base; the Board of Animal Health gets an $835,000 increase to $13.5 million; $8.8 million for the Agricultural Utilization Research Institute is a $1.7 million decrease; and the Office of Broadband Development is hit with a $123 million decrease to $2 million. (Art. 1, Secs. 1-9; Art. 2; Secs. 1-2)

Appropriations for the Agricultural Growth, Research, and Innovation Program within the Department of Agriculture are $35.2 million, including $6 million for bioincentive payments (a decrease of $5.5 million). Established in 2015, the program encourages the production of advanced biofuels, renewable chemicals and biomass thermal energy.

Other General Fund AGRI Program spending includes $5.5 million for biofuels infrastructure development, $3.5 million for urban and youth agriculture programs, $3.1 million for farm to school and early care programs, $2 million for food retail improvement and development programs, $2 million for county fair grants, and $400,000 to combat the spread of livestock and poultry diseases. (Art. 1, Sec. 2)

The law transfers $21.35 million to the University of Minnesota agriculture research, education, extension, and technology transfer program: $5 million for the Minnesota Agricultural Education Leadership Council to enhance agricultural education; $2 million for research on avian influenza, salmonella, and other turkey-related diseases and disease prevention measures; $1.6 million for the Forever Green Initiative, which develops winter-hardy, living soil cover crops; and $1.2 million for the Minnesota Agricultural Experiment Station’s agriculture rapid response fund. (Art. 1, Sec. 6)

The law transfers $1.5 million in fiscal year 2026 from the General Fund to the agricultural emergency account, with up to $750,000 of the funds available to test milk, milk products, poultry products, and pet food for the presence of avian influenza before retail sale; for Health Department biomonitoring for the presence of avian influenza in agricultural workers, farm workers, and poultry or livestock processing employees; and for the University of Minnesota to develop rapid testing for avian influenza in urban wastewater treatment processes, drinking water treatment processes, and public and private wells. (Art. 1, Sec. 6)

Two cancellations of previous appropriations are in the law: $3 million for funding grants to green fertilizer production facilities; and $1 million for funding Dairy Assistance, Investment, Relief Initiative grants. These took effect May 24, 2025. (Art. 1 Sec. 7)

Other specific appropriations in the law include:

• $3 million for dairy processing wastewater infrastructure at First District Association in Litchfield;

• $2.5 million for farm downpayment assistance grants;

• $2 million for the milk grant program;

• $2 million for the emerging farmers office;

• $1.7 million to replace capital equipment in the Department of Agriculture’s analytical laboratory;

• $1.5 million for additional meat and poultry inspection services;

• $1.4 million for local food purchasing assistance programs;

• $1.3 million for the soil health financial assistance program;

• $1 million for grants to counties to support county agricultural inspectors;

• $720,000 for mental health outreach and support to farmers, ranchers, farm workers and employees;

• $525,000 for wolf depredation compensation;

• $500,000 for a pilot biofertilizer innovation and efficiency program; and

• $485,000 for elk crop damage compensation. (Art. 1, Sec. 2)

Policy provisions

The Department of Agriculture must develop and administer a nitrogen reduction incentive program to address water quality by incentivizing Minnesota farmers to improve nitrogen management and incorporate innovative technologies into crop nutrient management plans.

The law expands the definition of livestock for the purposes of the livestock investment grant program to include “animals raised for the production of fiber, meat, and animal by-products for sale or as breeding stock,” including aquaculture. The law also expands eligibility for livestock investment grants to include tribal governments.

A new section in the state’s Dairy Law chapter is created that defines “milk marketer” and sets forth new regulations requiring a license for any such person. (Art. 3, Secs. 6-7, 16-17, 38)

Other provisions in the law include those that will:

• require noxious weed inspector or county-designated employee to attempt to contact landowners before entering property to conduct an inspection for noxious weeds;

• effective Aug. 1, 2027, modify the cottage foods exemption for home-processed pet treats to include sole proprietorships, single-member limited liability companies, and limited liability companies owned by two individuals residing at the same residence;

• authorize the state veterinarian to issue a permit to certain zoos to import live reindeer from another state under certain conditions;

• require that Rural Finance Authority loans for beginning farmers be no less than $20,000 and no more than $500,000;

• modify the eligibility for the disaster recovery loan program to require that a borrower’s total net worth be less than $10 million;

• raise inspection fees for grain buyers and modify grain storage fees;

• authorize the Department of Agriculture to award grants to eligible applicants to purchase and distribute food at no cost to Minnesotans experiencing food insecurity;

• require the Board of Veterinary Medicine to consult with veterinarians regarding the prohibition of cat declawing and to submit recommendations to the Legislature by Feb. 1, 2026;

• require the Board of Animal Health to prepare by March 1, 2026, information and materials about highly pathogenic avian influenza and preventing its spread in companion animals;

• modify requirements for bond claim hearings in case of default by licensed livestock dealers and agents;

• modify food handler and meat processing licensing application and renewal provisions;

• raise food handler license fees and authorize the Department of Agriculture to adjust fees every five years in line with inflation;

• raise reinspection fees for each reinspection of a food handler or custom exempt food handler that commits a major violation of requirements; and

• effective Aug 1, 2027, allow cottage foods to be delivered by mail or commercial delivery and lower the cottage foods exemption annual registration fee from $50 to $30. (Art. 3, Secs. 10, 14, 18, 20, 24, 29, 33-37; Art. 4, Secs. 11-14; Art. 5, Secs. 4, 9, 11, 14-15, 17)

HF2446* / SF2458 / CH34