Blog for Rural America

The Center for Rural Affairs, a private, non-profit organization, is working to strengthen small businesses, family farms and ranches, and rural communities. Permission to reprint items from this web log is hereby granted, on the condition that clear credit is given to the original source of the material. If the blog provides information for a story, please let us know by sending an email to johnc@cfra.org.

Tuesday, May 31, 2005

Practical Farmers of Iowa Field Days

The Rodale Institute’s George DeVault and PFI co-founder Dick Thompson will share memories as PFI celebrates a 20th Anniversary event on June 30, hosted by Ron and Maria Rosmann.

Other field day topics include:

Two of the hottest new alternative crops: organic flax and low-linolenic soybeans will be highlighted on the Greg Wiley, Dick Gallagher and Ron Dunphy farms, as well as others.

Vic and Cindy Madsen host a field day in September exploring their participation in the Conservation Security Program (CSP).

Vic and Cindy will show the many conservation practices on their farm while experts discuss the details of the CSP.

Organic-related field days include Laura Krouse (vegetables and corn, July 27 near Mt. Vernon), Nan Bonfils & Don Adams (corn, Sept. 11 near Boone) and Amy Miller and Mike Natvig (corn, Sept. 27 near Cresco).

A swine herd health workshop and look at alternative hog production July 26 on the Dan and Lorna Wilson farm.

A comprehensive grape-growing workshop hosted by Richard Black on July 23. Winemaking and wineries will also be covered.

For more information, call the PFI office at 515-232-5661, or go to http://www.practicalfarmers.org/ Field day guides available while they last.

Friday, May 27, 2005

Program to Aid Beginning Farmers Coming to Nebraska!

-- from the desk of Russ Gifford, Director Communications/Development
Center for Rural Affairs

May 27, 2005

The Farm Beginnings™ program is coming to Nebraska.
This program unites many groups and organizations in Nebraska to create all the tools necessary to support and foster new farmers. During the first eight years of the Minnesota version of this project, 222 people have completed the Farm Beginnings™ coursework. Over 60 percent of those graduates are farming. Nearly 20 percent of Farm Beginnings™ graduates have moved from urban to rural areas.

“Since the mid-90’s the Center for Rural Affairs has been telling folks that in 10 years many farmers are going to retire,” said Martin Kleinschmit. “Well, here we are. Farmers are retiring. What now?”

With a smile, Kleinschmit, who is the Center’s Sustainable Agriculture Specialist adds, “Now is a good time for beginners to get started in the business of farming.”

To help the next generation of farmers make the connection with success, the Center for Rural Affairs (CFRA) has joined with some powerful partners to bring together the people, the financial tools, and the mindset needed to overcome this challenge. Those partners include the Nebraska Sustainable Agriculture Society (NSAS), the Land Stewardship Project (LSP), UNL Extension, 5 Rivers RC&D and the Nebraska Department of Agriculture.

All of these groups will gather in the Capital Rotunda to kick off the new program, on June 7, at 2 p.m. State Senators Roger Wehrbein of District 2, Plattsmouth, and Lavon Heidemann of District 1, Elk Creek, as well as other honored guests, will be present for the event. Chuck Hassebrook, Executive Director for the Center for Rural Affairs will speak, among others.

Farm Beginnings™ started in the mid-1990s in southeast Minnesota as a means to provide participants the opportunity to learn firsthand about low-cost, sustainable methods of farming. A grant from the USDA’s North Central Region Sustainable Agriculture Research and Education (SARE) program has provided for the expansion to Nebraska, Illinois and Missouri.

"If you don’t have farmers on the land, you don’t have a base for economic development,” said Kleinschmit. “The program provides beginners with the ‘How To’ for a successful career in agriculture while the existing programs provide the tools for reaching that goal.”

Farm Beginnings™ is the link that connects beginning farmers with success.
If you are interested in learning more about Farm Beginnings™, contact Martin Kleinschmit, Center for Rural Affairs,
martink@cfra.org, at 402-254-6893.

Success in the Legislature

-- from the desk of Jon Bailey, Director Rural Research and Analysis Program
Center for Rural Affairs

May 26, 2005

In late March and early April we had a guest opinion that appeared in many newspapers across the state entitled “Building A New Rural Economy in Nebraska.”

In case you did not have the opportunity to read it, we said that the Legislature and the Governor had an opportunity to begin to create an economy in rural Nebraska that worked for all – an economy built on mobilization of local and regional resources and an economy that built on entrepreneurship.

All the Legislature and Governor had to do was adopt and make law a few bills:

* LB 273, the Building Entrepreneurial Communities Act
* LB 28, the Endow Nebraska Act
* LB 71, reauthorizing the value-added grant program
* Increasing the state appropriation for the Nebraska Microenterprise Partnership Fund
* LB 309, the Micoenterprise Tax Credit Act

Well, how did we do?

* LB 273 and LB 71 were rolled into the LB 90 rural economic development package that was signed into law today by the Governor
* LB 309 was included in the LB 312 tax incentive reform package that was signed into law by the Governor today
* The additional funding for the Nebraska Microenterprise Partnership Fund was included in the final budget approved by the Governor earlier this week
* LB 28 is awaiting a final round vote and should be approved by the Legislature next week

While some of these new (and re-authorized) programs will likely directly benefit the Center, more importantly they will benefit many rural people and communities across the state.

Thanks to all who contributed to this effort. Congratulations for a job well done!

Nebraska Legislative Update

-- from the desk of Jon Bailey, Director Rural Research and Analysis Program
Center for Rural Affairs

Legislative Update

May 27, 2005

This issue of the Legislative Update is sent early due to the Memorial Day holiday. The Legislature has adjourned for the week and is not back in session until Tuesday, May 31 – the start of the last week of the 2005 session.

LB 90: Rural Economic Development Package

On May 25, LB 90 was approved on Final Reading. The Final Reading vote was 46-2 (Senators Chambers and Raikes voting “No”). On May 26, the Governor signed the bill into law.

LB 312: Business Tax Incentive Reform

Also on May 25, LB 312 was approved on Final Reading. The Final Reading vote was 45-3 (Senators Chambers, Raikes and Schimek voting “No”). On May 26, the Governor also signed this bill into law.

Budget Update

On May 24, Governor Heineman signed LB 425 – the main budget appropriation bill – into law. However, he line-item vetoed about $8 million worth of spending over the two-year life of the budget.

Among the vetoes were: $656,000 in aid to community health centers for medical services to the uninsured (the budget approved by the Legislature had appropriated $875,000 in additional resources for the community health centers specifically for services to the uninsured; the five health centers in the state will continue to receive about $1.7 million in aid from the state over the next two years); $408,000 in both years for state reimbursements to county jails; $562,000 for child advocacy centers (treatment and counseling centers for abused children; and $1.2 million for the Nebraska Scholarship Program.

The Appropriations Committee recommended sustaining the Governor’s vetoes by not attempting to override any of them. There were attempts to override the vetoes on the health center, jail reimbursement and child advocacy center funding. All failed to receive the 30 votes necessary to override a veto.

Bills Update

Any bill designated a Priority Bill will also have a “P” attached to its number (for example, LB 123P). The chief sponsor of the bill is listed in parentheses.

The words Support or Oppose after a bill description indicate where the Center for Rural Affairs has taken a position on the bill. If neither word is indicated, the Center has not taken a position at this time.

NOTE: Once a bill is Indefinitely Postponed (killed) or signed into law, we will remove it from the Legislative Update list.

Rural Development

LB 28 (Connealy) – The “Endow Nebraska Act.” The bill would provide a tax credit for a contribution to a qualified charitable organization. On May 23, the bill was advanced to Final Reading. Support

Agriculture/Livestock

LB 132 (Cunningham) – This bill modifies the Nebraska Pasteurized Milk Law by providing exemptions to small-scale dairies and processors to the often-expensive bottling and processing requirements, and by allowing dairies and farmers to advertise on-farm sales of non-pasteurized milk (currently, the sale of non-pasteurized milk cannot be advertised). The bill sits on General File. Support

LB 346P (Agriculture Committee) – Would modify several provisions of the Beginning Farmer Tax Credit Act all with the goal to increase utilization of the tax credit. The bill sits on General File. Support

Education/Schools

LB 126P (Raikes) – Would mandate the “assimilation” of Class I schools (elementary-only schools) into K-12 school districts for the 2006-07 school year. The bill awaits action on Final Reading. Oppose

LB 129P (Education Committee) – An overhaul of the formula for state aid to schools. The bill is awaiting action on General File.

Other

LB 550 (Jensen) – Requires a plan to be submitted by December 1, 2005, for the financial support of community health centers and emergency medical services in the state. The bill awaits action by the Health and Human Services Committee.

Thursday, May 26, 2005

Future of Small Towns Online Idea Generator

-- from our friends at Minnesota Public Radio


Minnesota Public Radio Invites You to Contribute Ideas for the Future of Small Towns Online idea generator.

minnesota.publicradio.org/smalltowns

Your ideas for keeping small towns viable will inform discussion of Symposium for Small Towns in Morris, MN on June 7-8, 2005.

(St. Paul, Minn.) Minnesota's rural small towns have long defined the state's social and economic character, yet many are struggling to build a viable future.

The Internet and other communications tools are enabling some small towns to think up new and creative ways to survive. Tom McRoberts, director of the Center for Small Towns at the University of Minnesota-Morris says, "Often what separates a struggling small town from one with a bright future is a good idea and a core of people who have committed to it."

With this in mind, Minnesota Public Radio has created an online collaboration to generate enthusiasm and good ideas for overcoming the many challenges facing small towns. MPR invites anyone who cares about the future of small towns to visit the Future of Small Towns idea generator and offer ideas in a range of areas, including economic opportunity, people and health care: http://minnesota.publicradio.org/smalltowns.

Participants can help determine the most compelling solutions by rating and commenting on solutions offered by others. Many of the best ideas will be incorporated into the third annual Symposium for Small Towns, sponsored by the University of Minnesota-Morris and Minnesota Public Radio.

For more information about the symposium, go to: http://www.morris.umn.edu/services/cst/symposium/2005/index.htm.

Ideas and insights participants share will also help Minnesota Public Radio News track key and emerging issues facing small towns. "This is a great chance for us to tap the knowledge and insight of folks who live in small towns and who care about their future," says Andrew Haeg, senior producer and analyst for Minnesota Public Radio's Public Insight Journalism initiative. "That's going to pay off with stronger coverage of rural communities, and a much wider network of sources who can help us cover the news in the future."

A Partnership Between MPR and the University of Minnesota-Morris
Minnesota Public Radio is partnering with the University of Minnesota—Morris to present the third annual Symposium on Small Towns on June 7-8. The Future of Small Towns idea generator will advance the discussion before the symposium starts.

Michael Skoler and Andrew Haeg of Minnesota Public Radio News will be on hand at the symposium to talk about the role Public Insight Journalism will play in strengthening news coverage of communities across the state.

Public Insight Journalism
"The Future of Small Towns" online idea generator is an example of a new model for producing news coverage, known as "Public Insight Journalism." The Minnesota Public Radio initiative seeks to tap the vast expertise that lies in the collective experience and knowledge of the audience using a variety of techniques, to strengthen news coverage and to help shape programming.

Minnesota Public Radio's newsroom is transforming its culture and processes to regularly find and tap public insights to ensure it provides the smartest, most relevant reporting possible. The aim is to engage thousands of people in the newsroom's information gathering, to find fresh sources of expertise, to uncover new perspectives and to discover emerging issues and stories that are not yet on the public agenda.

Minnesota Public Radio® operates a 37-station radio network serving virtually all of Minnesota and parts of surrounding states and produces programming for radio, Internet and face-to-face audiences. Programs produced by Minnesota Public Radio and its national production and distribution arm, American Public Media™, reach 14.7 million listeners nationwide each week. Of those, more than 771,000 listen regionally, in Minnesota and surrounding states. With nearly 83,000 members, Minnesota Public Radio has the highest percentage of listener membership of any community-supported public radio network in the United States. A complete list of stations, programs and additional services can be obtained at www.mpr.org and www.americanpublicmedia.org.

Wednesday, May 25, 2005

Financial incentives offered for farmers and ranchers to convert to “organic”!

Informational Meetings in Northeast Nebraska on June 8, 10 & 13.

-- from the desk of Russ Gifford, Director Communications/Development
Center for Rural Affairs


LYONS, NE – Organic prices are usually 100-200% of conventional grains, but to sell products in the “organic” market, farmers and ranchers must be certified.

“That’s great news for producers, but the biggest obstacle for many farmers and ranchers is the 36-month transition period,” says Martin Kleinschmit of the Center for Rural Affairs. No unauthorized chemicals can be applied during the three-year changeover. That represents a potential loss in income during those three years, and more importantly, a change in management practices, he added.

The Nebraska Natural Resources & Conservation Service (NRCS) announced today an Organic Incentives Program option for the Environmental Quality Incentives Program (EQIP). This program will provide financial incentives for farmers and ranchers to convert conventional cropland to certified “organic” status. Farmers can apply for this program at any time, but to be eligible for approval this year, must have their applications submitted to NRCS prior to July 31, 2005.

Information meetings to help interested persons learn more about the program are scheduled for:
June 8, 2005 -- 10 am to noon – Hartington Public Library; Hartington, NE
June 10, 2005 – 10 am to noon – Knox County Extension Office; Center, NE
June 13, 2005 – 10 am to noon – Allen Fire Hall Meeting Room; Allen, NE

What does the program offer farmers and ranchers?
- An annual payment of $50 per acre for 3 years, for up to 120 acres of cropland.
- After three years, the operator must receive certification from a USDA approved organic certification agency.
- Acres in any phase of the conversion process are eligible for the incentive payment; however, farmers and acreages already certified organic are not eligible.

This EQIP program will provide incentives to offset financial risks, due to possible yield reductions and/or lender/landlord agreements. Incentives can help offset expenses for additional machinery and facilities not now a part of many conventional farms’ portfolio. These needs may include additional tillage or weed control equipment, storage facilities, and equipment needed to manage a more diverse crop mixture.

Applicants to the Organic Incentive Program can participate in a three-year education program designed to provide detailed information on what is required to certify organic and the practices needed to qualify. Applicants to this program will compete with other EQIP programs on the basis of environmental impact.

Applications can be submitted any time at NRCS offices in these counties: Boyd, Cedar, Knox, Dixon, Perkins, Chase, and Dundy. Review and ranking deadlines are January 31, March 31, May 31, and July 31.

National Organic Program (NOP) rules are available at USDA’s home page: www.usda.gov, click on “Agriculture”, then Organic Certification.

For more information, contact your local NRCS office; the Center for Rural Affairs Office in Hartington (Martin Kleinschmit 402-254-6893) or Lyons (Mike Heavrin 402-687-2100).

Tuesday, May 24, 2005

HOLD THE DAY!!!!

-- from the desk of Russ Gifford, Director Communications/Development
Center for Rural Affairs

Farm Beginnings™ Coming to Nebraska!
Kick off on June 7 – Capitol Rotunda


LYONS, NE – "The Farm Beginnings™ program is coming to Nebraska. This program unites many groups and organizations in Nebraska to create all the tools necessary to support and foster new farmers.

Think it can't be done? During the first eight years of the project, 222 people have completed the Farm Beginnings™ course in southeast and western Minnesota. Over 60 percent of those graduates are farming, and nearly 20 percent of Farm Beginnings™ graduates have moved from urban to rural areas.

The press conference celebrating the Nebraska kickoff of this successful program will be on June 7, at 2 pm, in the Capitol Rotunda in Lincoln, Nebraska. This release is to get you to put this event on your calendar! We'd like to see you there!

Guests are still being determined at this time, but we will be posting a follow-up to this note later this week. We hope to see you there! If you'd like an interview beforehand, please call 402.687.2100 and we'll coordinate the arrangements!

Center for Rural Affairs May 23, 2005 Nebraska Legislative Update

-- from the desk of Jon Bailey, Director Rural Research and Analysis Program
Center for Rural Affairs

Legislative Update

May 23, 2005

LB 90: Rural Economic Development Package

On May 17, LB 90 was advanced to Final Reading. Most of the debate on Select File concerned the provisions for funding the Ethanol Production Investment Credit program. Given the potential number of new ethanol plants being developed, debate centered on whether funds should be transferred from the state’s cash reserve fund or whether there should be a combination of cash funds and the grain checkoff fees. Ultimately, it was decided to leave the proposed LB 90 alone (a combination of state general funds and checkoff fees).

Sen. Chambers offered a significant amendment to LB 90A, the companion appropriations bill. Sen. Chambers proposed that the funding for the part of LB 90 that would provide grants to communities for entrepreneurial development be $1 million (rather than the proposed $250,000). This amendment was consistent with Sen. Chambers’ point on debate that rural development bills often request too little funding to make them effective. Unfortunately, the amendment lost on a 19-13 vote (25 needed for passage).

LB 312: Business Tax Incentive Reform

May 17 also saw LB 312 advance to Final Reading. On Select File the Legislature adopted an amendment introduced by Sen. Redfield that would reduce the level of tax credits in the investment only tier in proportion to any decrease in jobs at the company during the period credits were received. The intent is not to provide public subsiding of job loss as companies become more reliant on technology. Sen. Beutler offered an amendment to increase the minimum wage level for qualifying businesses in each tier to higher percentages of the state’s average weekly wage; the amendment failed on an 18-9 vote (25 votes needed).

Sen. Beutler also offered an amendment that would have required qualifying companies to provide healthcare plans or contribute to healthcare plans for their employees. Sen. Synowiecki offered a similar amendment – requiring employers in the larger tiers to pay at least 50 percent of healthcare benefits for employees. Both amendments failed (the Beutler amendment on a 14-12 vote and the Synowiecki amendment on a 20-2 vote; 25 votes needed for both).

Budget Update

On May 18, the budget bills (including LB 425, the main appropriations bill) received final approval and were sent to the Governor. LB 425 was adopted on a 34-10 vote. The Governor must sign or veto the budget bill by midnight May 24; the Governor may also line-item veto specific sections of the bill.

Class I Schools: LB 126 Returns

After nearly a three month hiatus, LB 126 retuned for second round debate week.

Since it’s been so long, a refresher on LB 126 is probably needed. Basically, the bill would require that all Class I (elementary-only) schools become “assimilated” into K-12 districts by the 2006-07 school year. Opponents believe this was the death knell for Class I schools; proponents believe this is a step toward a more effective and efficient school governance system.

If you remember, in February opponents and Sen. Raikes brokered a deal that allowed the bill to advance to Select File in return for discussions on a compromise bill. With time running out, a compromise amendment to the bill was finally offered last week. That compromise amendment was approved by a 35-6 vote; LB 126, as amended, was advanced to Final Reading by a 29-12 vote. Highlights of the compromise are:

Class I buildings could be kept open as “attendance centers” if they either meet criteria spelled out in LB 126 or at the discretion of the K-12 district. An attendance center building would be protected from closure if they have current kindergarten students – closure could not happen through the year in which current kindergartners complete the highest grade offered at that school (2013 for K-6 schools and 2015 for K-8 schools). Schools would also be protected if students are required to travel long distances to the nearest school. Any school not meeting those criteria is subject to closure by a vote of the K-12 board.

Elementary attendance centers could be designated as “community schools” through the formation of operating councils of three to six members. These councils would act in an advisory capacity to K-12 governing boards.

The “assimilation policy” will take effect for election purposes on January 1, 2006. This will allow citizens in Class I districts to vote and run for K-12 boards.

Grants of up to $100,000 would be distributed to school districts that adopt a school bond issue for at least $2 million before June 14, 2007, to remodel or build an elementary school. Qualifying school districts would have to meet other criteria, including enrolling at least 390 students during the 2005-06 school year.

Bills Update

Any bill designated a Priority Bill will also have a “P” attached to its number (for example, LB 123P). The chief sponsor of the bill is listed in parentheses.

The words Support or Oppose after a bill description indicate where the Center for Rural Affairs has taken a position on the bill. If neither word is indicated, the Center has not taken a position at this time.

NOTE: Once a bill is Indefinitely Postponed (killed) or signed into law, we will remove it from the Legislative Update list.

Rural Development

LB 28 (Connealy) – The “Endow Nebraska Act.” The bill would provide a tax credit for a contribution to a qualified charitable organization. The bill sits on Select File. Support

Agriculture/Livestock

LB 132 (Cunningham) – This bill modifies the Nebraska Pasteurized Milk Law by providing exemptions to small-scale dairies and processors to the often-expensive bottling and processing requirements, and by allowing dairies and farmers to advertise on-farm sales of non-pasteurized milk (currently, the sale of non-pasteurized milk cannot be advertised). The bill sits on General File. Support

LB 346P (Agriculture Committee) – Would modify several provisions of the Beginning Farmer Tax Credit Act all with the goal to increase utilization of the tax credit. The bill sits on General File. Support

Education/Schools

LB 126P (Raikes) – Would mandate the “assimilation” of Class I schools (elementary-only schools) into K-12 school districts for the 2006-07 school year. See above. Oppose

LB 129P (Education Committee) – An overhaul of the formula for state aid to schools. The bill is pending in the Education Committee.

Other

LB 550 (Jensen) – Requires a plan to be submitted by December 1, 2005, for the financial support of community health centers and emergency medical services in the state. The bill awaits action by the Health and Human Services Committee.

Thursday, May 19, 2005

REAP Program Announces New Staff Hiring

-- from the desk of Jeff Reynolds, REAP Program Co-Director
Center for Rural Affairs

The Rural Enterprise Assistance Project (REAP), a program of the Center for Rural Affairs, is pleased to announce the hiring of Adriana Dungan as our new Northeast REAP Business Specialist. Adriana holds a BA degree in Accounting from the Alfa Institute at Guadalajara, Mexico and a BA degree in Music and BD degree in Graphic Design from the University of Guadalajara, Mexico.

Adriana most recently worked as the Health Promoter for the NAF Multicultural Human Development Corporation at South Sioux City and also was Director of Training at Mission Mateo 25 at Sioux City, IA. Adriana was instrumental in promoting and instructing the Spanish version REAP business plan training at South Sioux City. In addition, she was the key person to get the REAP Asociación de Comercio Latino (REAP Latino Business Association) Roundtable group formed at South Sioux City.

Adriana will be providing REAP services in the following Northeast Nebraska counties: Antelope, Boone, Burt, Cedar, Colfax, Cuming, Dakota, Dixon, Dodge, Knox, Madison, Nance, Pierce, Platte, Stanton, Thurston, and Wayne.

REAP is Nebraska’s largest microenterprise program and operates on a statewide, rural basis through regionally based Business Specialists. REAP provides lending, training, networking, and technical assistance opportunities for startup and existing small microenterprises (businesses with 5 or fewer employees).

REAP also provides “peer group” loans up to $10,000 through locally formed associations of small business people through a “step up” process and individually up to $25,000 through the REAP Direct loan program. The Direct loan program was added in 1999. Since 1990, REAP has placed 276 peer group loans totaling $473,423. Since 1999, REAP has placed 159 direct loans totaling $2,187,708. REAP has leveraged an additional $5,119,320 in loans from traditional sources since 1999 due to its business planning and loan packaging services.

REAP collaborates with many other individuals and organizations and is a member of the Nebraska Enterprise Opportunity Network (NEON). NEON is the trade association in Nebraska for microenterprise programs and offers policy and training opportunities for microenterprise programs and practitioners. A complete listing of microenterprise service providers in Nebraska can be found at http://www.nebbiz.org/gsearch.php.

Established in 1973, the Center for Rural Affairs is a private, non-profit organization working to strengthen small businesses, family farms and ranches, and rural communities through action oriented programs addressing social, economic, and environmental issues.

Adriana operates from a home based office at South Sioux City and began her duties on May 2nd. Adriana can be reached at (402) 494-1013 or adungan@msn.com.

Wednesday, May 18, 2005

Extra! Extra! NE Legislative Update on LB 90 and LB 312

-- from the desk of Jon Bailey, Director Rural Research and Analysis Program
Center for Rural Affairs

Last night the Legislature advanced both LB 90 (the rural economic development package) and LB 312 (the business tax incentive package, including the small business tax credit) to Final Reading.

Both bills will come up for a Final Reading vote probably early next week. Generally, no amendments are allowed on Final Reading, so the version that advanced last night will likely be what becomes law.

Tuesday, May 17, 2005

Center for Rural Affairs May 16, 2005 Nebraska Legislative Update

-- from the desk of Jon Bailey, Director Rural Research and Analysis Program
Center for Rural Affairs


Legislative Update

May 16, 2005

LB 90: Rural Economic Development Package

The Unicameral completed first round debate on LB 90, the amended bill that now represents a package of rural economic development initiatives. Again, the package includes 1) increased funding for ethanol production credits; 2) value-added agriculture grants (originally LB 71); 3) increasing loan and qualifying amounts for the Nebraska Investment Finance Authority beginning farmer program (originally LB 688); and grants to communities for entrepreneurial development (originally LB 273).

During General File debate, two major amendments were adopted. An amendment offered by Sen. Chambers would require communities to provide dollar-for-dollar match (rather than in-kind) for the entrepreneurial grants, and an amendment offered by Sen. Beutler would sunset the value-added and entrepreneurial grants on October 1, 2010 (the same date as the ethanol production credits sunset).

The bill was advanced to Select File debate, likely early this week.

LB 312: Business Tax Incentive Reform

LB 312, the proposed revision of the state’s business tax incentive programs, also received General File debate last week. The bill advanced to Select File. There are numerous amendments pending.

Budget Update

LB 425, the main budget bill, was advanced to Final Reading. With few relatively minor changes, the Appropriations Committee budget recommendation was advanced. Among the amendments added to the budget bill were: 1) an increase on the cap on state aid to schools for special education; 2) $7.5 million for each of the budget’s two years to be transferred from the reserve fund for job training; and 3) increased aid for counties to reimburse them for jailing state prisoners.

Bills Update

Any bill designated a Priority Bill will also have a “P” attached to its number (for example, LB 123P). The chief sponsor of the bill is listed in parentheses.

The words Support or Oppose after a bill description indicate where the Center for Rural Affairs has taken a position on the bill. If neither word is indicated, the Center has not taken a position at this time.

NOTE: Once a bill is Indefinitely Postponed (killed) or signed into law, we will remove it from the Legislative Update list.

Rural Development

LB 28 (Connealy) – The “Endow Nebraska Act.” The bill would provide a tax credit for a contribution to a qualified charitable organization. The bill sits on Select File. Support

Agriculture/Livestock

LB 132 (Cunningham) – This bill modifies the Nebraska Pasteurized Milk Law by providing exemptions to small-scale dairies and processors to the often-expensive bottling and processing requirements, and by allowing dairies and farmers to advertise on-farm sales of non-pasteurized milk (currently, the sale of non-pasteurized milk cannot be advertised). The bill sits on General File. Support

LB 346P (Agriculture Committee) – Would modify several provisions of the Beginning Farmer Tax Credit Act all with the goal to increase utilization of the tax credit. The bill sits on General File. Support

Education/Schools

LB 126P (Raikes) – Would mandate the “assimilation” of Class I schools (elementary-only schools) into K-12 school districts for the 2006-07 school year. The bill awaits action on Select File. Oppose

LB 129P (Education Committee) – An overhaul of the formula for state aid to schools. The bill is pending in the Education Committee.

Other

LB 550 (Jensen) – Requires a plan to be submitted by December 1, 2005, for the financial support of community health centers and emergency medical services in the state. The bill awaits action by the Health and Human Services Committee.

Thursday, May 12, 2005

USDA Competitive Grant Programs Get Low Marks in Service to Small, Mid-Size, and Beginning Farmers and Ranchers

-- from the desk of Marie Powell, Communications Associate
Center for Rural Affairs

Washington DC briefings will share preliminary results of a study on federally-funded USDA projects

LYONS, NE – Federal dollars were not well spent on projects to improve farm profitability and rural community success, according to the Center for Rural Affairs, a leading advocate for rural issues based in Lyons, Nebraska.

On Thursday, May 19, 2005, Kim Leval, senior policy analyst with the Center, will brief Congressional leaders and staff, agency staff, and media on what researchers found. Leval will be joined by project assistant Amanda Tuttle.

“We wanted to know if family farms and rural communities were truly benefiting from the infusion of federal dollars coming from these programs,” said Leval. “While some exemplary projects have risen to the top, our preliminary research shows these programs are not serving family farmers and rural communities to their full potential.” Results show a “D” average for projects studied so far.

The two-year study examines spending from three key federal agricultural research, marketing, and business enterprise development programs.

The programs and their purposes include:
Rural Business Enterprise Grants (RBEG) Program, intended to finance and develop small and emerging business enterprises.

National Research Initiative (NRI), intended for research programs which respond to the nation’s food, fiber, and natural resource challenges.

Initiative for Future Agriculture and Food Systems (IFAFS), now subsumed into the NRI, but originally intended, in part, to research challenges to small and mid-size farms and ranches.

Briefing Times and Locations:
A special Iowa briefing will be held at 11 a.m. in the House Agriculture Committee Briefing Room1300, Longworth House Office Building.

A general briefing, open to all, will follow from noon to 1 p.m. in the same location.

An Iowa briefing on the Senate side will begin at 2 p.m. in room 328-A of the Russell Senate Office Building.

A general Senate briefing will follow at 3 p.m. in room 328-A.

The next phase of the study will examine the USDA Value Added Producer Grants Program and will use a benefit-cost analysis to look more fully at the potential for programs such as these to invigorate rural economies.
The research was undertaken by the Center for Rural Affairs in cooperation with Iowa State University Extension with funding from the Leopold Center.

For more information, contact Kim Leval at (402) 870-0658 or kimleval@qwest.net

Established in 1973, the Center for Rural Affairs is a nonprofit working to strengthen small businesses, family farms and ranches, and rural communities. Find out more about the Center at our website, http://www.cfra.org

A Closer Look at "Livestock Friendly County" Designations

-- from the desk of Jon Bailey, Director Rural Research and Analysis Program
Center for Rural Affairs

In 2003, the Nebraska Legislature established the "Livestock Friendly County" program in the state. This program will allow any county in Nebraska to seek a special designation as a "Livestock Friendly County" from the Nebraska Department of Agriculture.

Under the law, any county may pass a resolution designating itself "livestock friendly." To date, no county in Nebraska has been awarded the designation as a "Livestock Friendly County." However, at least a dozen counties are in the process of seeking the designation or have inquired about the program.

Beware Local Zoning Impacts
Most Nebraska counties have comprehensive zoning plans that govern aspects of livestock facility siting and operation. These plans exist for the control of land use in a county and to provide local control. Residents of any county interested in the "Livestock Friendly" designation should be concerned about its impact on local zoning regulations.

An example from the program regulations demonstrates this point. In its application a county must include all zoning regulations, procedures, and permits to livestock feeding operations during the previous 24 months. These items are then reviewed under guidelines that include whether restrictions on livestock operations are based on "scientifically justified environmental risk analysis," whether decisions regarding zoning permits for feeding operations are clearly based on objective, science-based standards, and whether conditions required for livestock feeding operations (such as setbacks) are reasonable and justified.

Local Decisions Shift to State
The result is that under the "Livestock Friendly" designation, local zoning regulations created by local elected officials and local citizens are now reviewed by state officials. Ultimately, that means they are controlled by state officials.

Under Nebraska law, zoning ordinances must "promote health, safety … and the general welfare of the community." These are uniquely local decisions – what promotes the "general welfare" in one community may, or may not be necessary in another community.

Counties seeking the Livestock Friendly designation give up the ability to make local "general welfare" decisions. Those controls will no longer exist because zoning plans will now be subject to state-imposed, undefined standards of what is "scientific," "reasonable," or "justified."

Citizen Right to Participate
As citizens, you are still afforded rights to participate in a county’s process in seeking the "Livestock Friendly County" designation. If your county is discussing the "Livestock Friendly County" program get educated, get involved, and participate in the process.

Tuesday, May 10, 2005

Center for Rural Affairs May 9, 2005 Nebraska Legislative Update

-- from the desk of Jon Bailey, Director Rural Research and Analysis Program
Center for Rural Affairs

Legislative Update

May 9, 2005

Rural Economic Development Package

In response to LB 312 that primarily seeks to modify business tax incentives (see below), several rural Senators have developed a rural economic development package that contains portions of several bills.

Senators Wehrbein, Cunningham, Kremer, Schrock and Stuhr have introduced an amendment to LB 90 (originally a bill to increase the excise tax on corn and sorghum to help support ethanol production.) The bill as now amended and contains the following provisions:

Funding of the Ethanol Production Incentive Cash Fund to the tune of $2.5 million in each of fiscal years 2005-06 and 2006-07, $5.5 million in fiscal year 2007-08 and $2.5 million in each of fiscal years 2008-09 through 2011-12;

* $850,000 for value-added agricultural grants (from LB 71);

* $250,000 in grants to communities for entrepreneurial development (from LB 273);

* and an increase in the corn and sorghum excise tax (check-off) to 7/8ths cent per bushel of corn and per hundredweight of sorghum until 2010. The amount collected would be transferred to the Ethanol Production Incentive Cash Fund.

The Center supports the amendment (Amendment 1346) to LB 90. Debate on LB 90 is scheduled to begin on Monday, May 9.

LB 312: Business Tax Incentive Reform?

As reported last week, the Revenue Committee advanced LB 312, the long-awaited economic development/business tax incentive bill. LB 312 also borrows heavily from other bills. The major components of LB 312 are:

* Inclusion of a tax credit for microenterprises (from LB 309).

* Tax credit for increases in research and development spending (from LB 672).

* Sales tax exemption for manufacturing machinery and equipment (from LB 695).

* Allows tax credits in counties of less than 15,000 under the Employment and Expansion and Investment Incentive Act (also known as the LB 608 program) for creation of two jobs and investment of $125,000.

The most significant portion of LB 312 is the creation of a new business tax incentive program. The LB 775 program would be replaced by the new Nebraska Advantage Act. The new program would differ from LB 775 in the following ways:

* A required wage of at least 60 percent of the state’s average wage for all employees in order to qualify for benefits.

* Larger wage credits for higher-paying new jobs.

* Creation of a “jobs-only tier” that provides tax credits for the creation of jobs but does not require a minimum investment amount.

* Requiring disclosure of project-specific credits used and refunds received every other year.

* Modification of tiers – the required number of jobs to be created and investment made – to qualify for credits; in general, the requirements are larger.

The wage level is a significant reform from LB 775. The disclosure requirements appear to more than exist currently, but still less than full disclosure.


Budget Update

The main budget bill – LB 425 – was debated last week and was adopted on General File on May 5. The Appropriations Committee budget recommendation was adopted as LB 425 on first round debate with few amendments. The Legislature amended the committee budget to continue the Nebraska’s Women’s Commission ($200,000 for each of the next two years) and to implement a pilot program to continue pregnancies ($500,000). It is expected more amendments will be attempted next week during second round debate.

Bills Update

Any bill designated a Priority Bill will also have a “P” attached to its number (for example, LB 123P). The chief sponsor of the bill is listed in parentheses.

The words Support or Oppose after a bill description indicate where the Center for Rural Affairs has taken a position on the bill. If neither word is indicated, the Center has not taken a position at this time.

NOTE: Once a bill is Indefinitely Postponed (killed) or signed into law, we will remove it from the Legislative Update list.

Since LBs 71, 273 and 309 have been amended into the bills discussed above they have been deleted from the Bills Update section.

Rural Development

LB 28 (Connealy) – LB 28 (Connealy) – The “Endow Nebraska Act.” The bill would provide a tax credit for a contribution to a qualified charitable organization. The bill sits on Select File. Support

Agriculture/Livestock

LB 132 (Cunningham) – This bill modifies the Nebraska Pasteurized Milk Law by providing exemptions to small-scale dairies and processors to the often-expensive bottling and processing requirements, and by allowing dairies and farmers to advertise on-farm sales of non-pasteurized milk (currently, the sale of non-pasteurized milk cannot be advertised). The bill sits on General File. Support

LB 346P (Agriculture Committee) – Would modify several provisions of the Beginning Farmer Tax Credit Act all with the goal to increase utilization of the tax credit. The bill sits on General File. Support


Education/Schools

LB 126P (Raikes) – Would mandate the “assimilation” of Class I schools (elementary-only schools) into K-12 school districts for the 2006-07 school year. The bill awaits action on Select File. Oppose

LB 129P (Education Committee) – An overhaul of the formula for state aid to schools. The bill is pending in the Education Committee.


Other

LB 208 (Stuthman) – Provides for the appropriation of $1.75 million annually for the next two years to the state’s five federally qualified health clinics to provide services to the uninsured (the clinics are in Omaha, Lincoln and Scottsbluff). The bill is pending in the Appropriations Committee. The Appropriations Committee budget adds $875,000 to compensate the federally qualified health clinics for the increase in services provided uninsured patients. Support

LB 550 (Jensen) – Requires a plan to be submitted by December 1, 2005, for the financial support of community health centers and emergency medical services in the state. The bill awaits action by the Health and Human Services Committee.

Tuesday, May 03, 2005

Rural Enterprise Assistance Project Awards $9,000 to Nebraska Women for Business Development

-- from the desk of Steph Eastman, Communications Associate
Center for Rural Affairs


Nine women micro-entrepreneurs in Halsey, Naper, Seward, Central City, Fairbury, Peru, O’Neill and Roca, Nebraska each received a $1,000 cash equity award from The Center for Rural Affairs – Rural Enterprise Assistance Project (REAP).

“This has been a unique opportunity for REAP to make awards to women business owners in Nebraska,” said Glennis McClure, REAP Women’s Business Center Director. “The awards are intended to help boost the recipient’s business success. Our REAP - Women's Business Center staff will work with them closely and look for positive results.”

REAP is one of only eight Local Partners to the national Women and Company. Microenterprise Boost Program (WCMBP). WCMBP provided the cash equity awards to assist the women in growing and developing their businesses.

REAP clients receiving $1000 awards include:
Diane Goodier, Halsey Stockade Inn, Halsey, Nebraska
Linda Goodman, Lynn’s Upholstery, Naper, Nebraska
Pat Coldiron, Liberty House B & B, Antiques and Gifts, Seward, Nebraska
Missy Hillmer, Hillmer Photography, Central City, Nebraska
Ann Yates, Honey Creek Vineyards & Bakery, Peru, Nebraska
Keri York, Therapeutic Dimensions, Fairbury, Nebraska
Linda Tynon, IADA (International Assoc. of Destination Agents), Peru, Nebraska
Jan McNichols, The Emerald Spa, O’Neill, Nebraska
Rose Templeton, Body Wise Health /Nutrition, Roca, Nebraska

Recipients were selected through an application process coordinated by REAP. The awards can be used for essential business development activities such as marketing, technology purchases, website development, inventory, or professional services.

In addition to the cash equity award, the recipients are receiving technical training and assistance from REAP on growing their business and maximizing their equity award. McClure, along with the REAP Business Specialist of their area, will visit the recipients to present their awards.

Funding for the WCMBP is provided by the Citigroup Foundation. Women and Company, a division of Citigroup, provides access to financial education and resources for women, and is working with the Association for Enterprise Opportunity (AEO) to implement and promote the program.

Established in 1973, the Center for Rural Affairs is a private, non-profit organization working to strengthen small businesses, family farms and ranches, and rural communities through action oriented programs addressing social, economic, and environmental issues.

The Center for Rural Affairs – Rural Enterprise Assistance Project (REAP) consists of four elements including; networking, business management training, credit and technical assistance. Local rural communities form associations or roundtable networking groups which meet for discussing business ideas and problems, networking, ongoing training and reviewing loan applications if a local loan loss reserve is established. REAP is an SBA micro-loan program and operates the only SBA funded Women’s Business Center in Nebraska. REAP staff provide technical assistance, loan packaging assistance and training to rural small business owners.

Citigroup (NYSE:C), the preeminent global financial services company has some 200 million customer accounts and does business in more than 100 countries, providing consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, insurance, securities brokerage, and asset management. Major brand names under Citigroup’s trademark red umbrella include Citibank, CitiFinancial, Primerica, Smith Barney, and Banamex. The Citigroup Foundation focuses its grants primarily in three areas: financial education, educating the next generation, and building communities and entrepreneurs. Additional information may be found at www.citigroup.com.

Women and Company is a membership program from Citigroup designed to help women expand their financial knowledge, and prepare themselves for financial decisions that life’s transitions often bring. Women and Company provides financial education through conference calls, Master Classes, and newsletters; personal attention through toll-free resource lines for questions related to taxes, general finance, care giving, survivorship and real estate issues; and special savings on select Citigroup financial products. Additional information may be found at www.womenandco.com.

The Association for Enterprise Opportunity (AEO) is the national association of community-based organizations that provide entrepreneurial education, access to capital, and support to aspiring and active low-income entrepreneurs. AEO's mission is to support the development of strong and effective U.S. microenterprise programs to assist underserved entrepreneurs in starting, stabilizing, and expanding businesses. To learn more about AEO or microenterprise, please visit our website at www.microenterpriseworks.org.

Center for Rural Affairs May 2, 2005 Nebraska Legislative Update

-- from the desk of Jon Bailey, Director Rural Research and Analysis Program
Center for Rural Affairs

Legislative Update
May 2, 2005

Appropriations Committee Budget Released

On April 28, the Appropriations Committee officially released its recommended 2005-07 biennial budget to the rest of the Legislature. This budget plan concerns the two-year period starting July 1, 2005.

The budget proposes $6.1 billion in state government spending during the two years, an annual average spending growth of 6.9 percent. Spending on state agency operations increases the least (5.75 percent), while spending on state aid to individuals increases the most (8.4 percent).

The vast majority of spending increases are in programs over which the Legislature, absent statutory changes, has limited control – public assistance, Medicaid, state aid to schools, and state employee salaries and benefits. Several of these programs suffered budget cuts in the past several years – the Appropriations Committee now proposes significant spending increases (for example, 9 percent in K-12 state aid; 8 percent for Medicaid; and 6.8 percent for postsecondary education).

The Appropriation Committee also proposes spending $145.8 million from the state’s cash reserve fund to make a lump-sum payment of the low-level radioactive waste dump litigation settlement.

As proposed, the committee’s budget has a $22 million cushion above the legally required amount that must be placed in reserve. This amount represents the money the Legislature has to play with in the remaining days of the 2005 session and the 2006 session. As we outlined last week, over $90 million worth of spending proposals are now at various stages of legislative debate.

From the Center’s perspective, one piece of good news in the proposed budget was the maintenance of the Governor’s proposed doubling of funding to the Nebraska Microenterprise Partnership Fund (from $247,500 to $497,500). The Center’s REAP program is a grantee of the Partnership Fund.

Without any changes in anticipated spending and revenue, the picture is not as bright for the next budget period (2007-09). The Appropriations Committee is forecasting a budget deficit of over $146 million for that period. This deficit is caused in large measure by an increase in state aid to education caused by a property tax levy limit decrease.

The forecast got immediately rosier – at least for this year and next two years – as the Nebraska Economic Forecasting Board (meeting the same day as the Appropriations Committee budget was released) upped their revenue forecasts by an additional $40 million for the current fiscal year and $20 million for each of the next two years. This will likely have the effect of allowing the Legislature to meet more of the pending spending proposals in the Legislature. However, the storm clouds on the horizon and the policy choices that caused them will need to be dealt with in the coming years.

Debate on the budget will begin this week.

Finally, a Business Tax Incentive Proposal

After weeks of negotiations, the Revenue Committee finally adopted a business tax incentive and economic development plan last week. The proposal is estimated to cost about $30 million over the next two years and $430 million over 10 years in addition to the estimated $140 million per year the state already spends on business tax incentives.

LB 312 – the bill in which the proposal is now contained – uses LB 775 (the state’s largest business tax incentive program) as a start and modifies job and investment requirements. Under the plan qualifying businesses would also be required to pay workers at least 60 percent of the average state wage; there is currently no wage requirement under LB 775.

A full analysis of LB 312 will be provided in next week’s update.

A Full Calendar

There are only 19 days left in the 2005 session and many contentious and important issues remain to be debated.

Several Senators are beginning to discuss the possibility that many bills will be held over until the 2006 session, and that the budget – the only item the Senators are required to act upon – will be the only major piece of legislation decided in the remaining days of the session.

Bills Update

Again, no action was taken last week on any of the bills listed below.

Any bill designated a Priority Bill will also have a “P” attached to its number (for example, LB 123P). The chief sponsor of the bill is listed in parentheses.

The words Support or Oppose after a bill description indicate where the Center for Rural Affairs has taken a position on the bill. If neither word is indicated, the Center has not taken a position at this time.

NOTE: Once a bill is Indefinitely Postponed (killed) or signed into law, we will remove it from the Legislative Update list.

Rural Development

LB 28 (Connealy) – The “Endow Nebraska Act.” The bill would provide a tax credit for a contribution to a qualified charitable organization. The bill sits on Select File. Support

LB 273P (Cunningham) – Would create the “Building Entrepreneurial Communities” program through a grant program for each of the next two years. The bill remains on General File, though it is bracketed until April 19 and cannot be brought up for consideration before that date. Support

Agriculture/Livestock

LB 71P (Stuhr) – Would re-authorize the Agricultural Opportunities and Value-Added Partnership Act (formerly the LB 1348 grant program). This program was terminated through budget cuts in 2001 and 2002. This bill would reauthorize the program through 2009. Sen. Stuhr has designated this as her Priority Bill. The bill awaits a vote on Final Reading. Support

LB 132 (Cunningham) – This bill modifies the Nebraska Pasteurized Milk Law by providing exemptions to small-scale dairies and processors to the often-expensive bottling and processing requirements, and by allowing dairies and farmers to advertise on-farm sales of non-pasteurized milk (currently, the sale of non-pasteurized milk cannot be advertised). The bill sits on General File. Support

LB 346P (Agriculture Committee) – Would modify several provisions of the Beginning Farmer Tax Credit Act all with the goal to increase utilization of the tax credit. The bill sits on General File. Support

Education/Schools

LB 126P (Raikes) – Would mandate the “assimilation” of Class I schools (elementary-only schools) into K-12 school districts for the 2006-07 school year. The bill awaits action on Select File. Oppose

LB 129P (Education Committee) – An overhaul of the formula for state aid to schools. The bill is pending in the Education Committee.

Taxes

LB 309 (Connealy) – Would establish the Small Business Rural Microenterprise Tax Credit. The bill would provide for $2 million worth of tax credits annually for small business (with five or fewer employees or beginning farmers/ranchers) in areas with declining population or low incomes or federal enterprise zones. The bill is pending in the Revenue Committee. Support

Other

LB 208 (Stuthman) – Provides for the appropriation of $1.75 million annually for the next two years to the state’s five federally qualified health clinics to provide services to the uninsured (the clinics are in Omaha, Lincoln and Scottsbluff). The bill is pending in the Appropriations Committee. The Appropriations Committee budget adds $875,000 to compensate the federally qualified health clinics for the increase in services provided uninsured patients. Support

LB 550 (Jensen) – Requires a plan to be submitted by December 1, 2005, for the financial support of community health centers and emergency medical services in the state. The bill awaits action by the Health and Human Services Committee.

Monday, May 02, 2005

Three Reasons to Reform, Not Repeal, the Estate Tax

-- from the desk of Chuck Hassebrook, Executive Director
Center for Rural Affairs


The U.S. House of Representatives has voted to permanently repeal the estate tax. If the Senate goes along, it will be bad for family farms and ranches, bad for America, and bad for democracy.

First, the estate tax provides some semblance of a “level playing field.”
Talent and ambition are no match for the economic power and advantage of a $20 million inheritance at a land auction. With no estate tax, competition will increasingly be based on station of birth, rather than working hard and smart.

Many family farmers and business people are concerned that estate taxes will make it harder for the next generation to continue the family business. But proposals to exempt $2 million per person ($4 million per family) would exempt the estates of the overwhelming majority of family farms and rural small businesses.

Second, when wealth concentrates American is weakened.
The estate tax is a critical preventative measure. There is a natural tendency for wealth to concentrate. The richest 1 percent of Americans now control over one-third of the nation’s wealth – a 50 percent increase over their share in 1976. These are the very families that pay the lion’s share of estate taxes. Removing the estate tax will only accelerate wealth concentration.

History warns us of the dangers of concentrated wealth.
As wealth concentrates, power concentrates. Average families begin to feel they have no stake, which ultimately leads to collapse. It has happened repeatedly. But it need not happen in America if we take steps to prevent it.

Finally, we should tax the largest estates because it is one of the fairest ways to raise revenue.
The federal government is running record deficits. The Social Security Trust Fund is building insufficient funds to meet its future obligations. The president has proposed deep cuts in rural development programs, farm programs for family-size farms, and conservation programs to balance the budget.

Is this really the time to grant a $70 billion per year tax break to the nation’s wealthiest families?
The alternative proposal to raise the exemption would address the concerns of family-size farms and ranches and most rural small business. But it would save two-thirds of estate tax revenue to pay the nation’s bills and constrain ballooning deficits.

That is a far better solution than giving a windfall to the rich and passing the bill to our children and grandchildren.