SP0517
LD 1431		 Session - 126th Maine Legislature
C "B", Filing Number S-467, Sponsored by
LR 1673
Item 3
Bill Tracking, Additional Documents Chamber Status

Amend the bill by striking out all of the preamble (page 1, lines 1 to 4 in L.D.)

Amend the bill by striking out everything after the enacting clause and before the emergency clause and inserting the following:

‘Sec. 1. 7 MRSA §306-A, sub-§2,  as enacted by PL 1999, c. 72, §5, is amended to read:

2. Fund operation.   The commissioner shall utilize the agricultural development fund to:
A. Provide grants to individuals, firms or organizations to conduct market research or to undertake market promotion activities for the purpose of expanding existing markets and developing new markets for state agricultural products; and
B. Test and demonstrate new technologies related to the production, storage and processing of state agricultural commodities . ; and
C.  Provide local foods grants to Maine-based individuals, firms or organizations under section 320-B, subsection 1 to conduct market feasibility studies, in diverse geographic areas of the State if possible, to identify the demand for and pricing, logistical parameters and availability of minimally processed fresh foods grown in this State, and of seafood grown or harvested in this State for aggregated and institutional markets, including school food service programs.

Sec. 2. 7 MRSA §306-A, sub-§3,  as amended by PL 2013, c. 64, §1, is further amended to read:

3. Rulemaking.   The commissioner shall establish, by rule, in a manner consistent with Title 5, chapter 375, subchapter 2-A criteria for the allocation of grant money, application requirements consistent with the provisions of this section and section 320-B, a schedule for accepting and reviewing applications, reporting requirements on grant expenditures and project results and any other administrative requirements necessary for the efficient implementation of this program. Rules adopted pursuant to this subsection are major substantive rules as defined in Title 5, chapter 375, subchapter 2-A. The commissioner is guided by the following criteria:
A. Applications may be submitted by individuals, firms or organizations in response to a request for proposals for competitive grants. The commissioner may also contract directly with individuals, firms or organizations for a special project under section 307;
B. A percentage of the total cost of any project must be funded by the applicant or applicants and a percentage of the total cost must be funded from nonpublic sources. These percentages must be established by rule. A single grant may not exceed 50% of the total funds available to be granted in a given year;
C. Information relative to market research or development activities provided to the commissioner prior to formal application, included in grant applications or provided to the commissioner to fulfill reporting requirements , is confidential information and may not be publicly disclosed by the commissioner as long as:

(1) The person to whom the information belongs or pertains has requested that certain information be designated as confidential; and

(2) The commissioner has determined that the information gives the person making the request opportunity to obtain business or competitive advantage over another person who does not have access to the information or will result in loss of business or other significant detriment to the person making the request if access is provided to others; and

D. When possible, the commissioner shall award grants to applicants representing diverse agricultural enterprises and geographic areas of the State . ; and
E.  The commissioner shall consider administrative requirements necessary for local foods grants under section 320-B, subsection 1, including a definition of "minimally processed foods," the allocation of grant funds, application requirements consistent with the provisions of chapter 10-C, a schedule for accepting and reviewing applications and reporting requirements on grant expenditures and project results.

Sec. 3. 7 MRSA c. 10-C  is enacted to read:

CHAPTER 10-C

LOCAL FOOD HUB PROGRAM

§ 320-A.  Definitions

As used in this chapter, unless the context otherwise indicates, the following terms have the following meanings.

1.  Local food.   "Local food" means food produced or harvested by a Maine food producer as defined by section 212, subsection 2.

§ 320-B.  Local food hub program; grants and loans

The commissioner shall issue grants under section 306-A for the purpose of conducting market feasibility studies and developing business plans for local food hubs in this State to connect and enhance relationships between fresh food producers in the State and aggregated and institutional markets, including school food service programs. The commissioner shall issue low-interest loans under subsection 2 and section 435 for the development and operation of local food hubs in this State based on how well the local food hubs' business plans, as reflected in competitive applications, serve to connect and enhance relationships between fresh food producers in the State and aggregated and institutional markets, including school food service programs.

1.  Local foods grants.   The commissioner shall award at least one grant each of no more than $30,000 to applicants based in this State to conduct market feasibility studies and develop business plans for local food hubs. An applicant must demonstrate:
A.  The capacity to research aggregated and institutional markets' demand for and pricing, logistical parameters and availability of fresh and minimally processed foods produced in this State;
B.  Expertise related to the market feasibility study and the capacity to create and implement business plans for local food hubs located in this State if the applicant is applying for a local food hub loan under subsection 2; and
C.  A commitment to the requirements of the United States Department of Agriculture with regard to meals provided in schools.

The intent of a market feasibility study and business planning process supported by grant funds must be to serve local farms. A business plan must be crafted to maximize the benefits to farms that supply the local food hub and to minimize, if not remove, any negative effects of a new local food hub on existing farm operations. The commissioner may not award a grant under this subsection to an applicant unless matching funds from the applicant are available in an amount that is no less than 50% of the grant amount.

2.  Local food hub loans.   The commissioner shall award local food hub loans from the Agricultural Marketing Loan Fund established under Title 10, section 1023-J in accordance with the provisions of section 435 to applicants in diverse geographic areas of the State for the purpose of establishing local food hubs in this State. Prior to awarding a loan under this subsection, the commissioner shall determine that the potential overall impact of the application to the agricultural economy and agricultural industry in this State is beneficial to and in the best interest of the agricultural industry and well-being of the State. Applications for loans under this subsection must include business plans that examine economic impacts and are based on the market studies completed under subsection 1 or equivalent market knowledge. An application must demonstrate:
A.  That the application is based on sound business and financial principles;
B.  That the applicant is able to locate and obtain food from growers based in this State and, where feasible, fisheries in this State, and has the capacity to handle the logistics of supplying and delivering those foods as ordered by aggregated and institutional markets, including school food service programs;
C.  That the applicant has the capacity to provide fresh food or minimally processed food sourced in this State;
D.  That the applicant has knowledge of health-oriented food production methods in order to maintain nutritional value and minimize food contaminants;
E.  That the applicant will exercise sustainable waste management practices, including composting of food waste and minimal use of disposable nonreusable packaging materials;
F.  That the applicant has the ability to encourage food producers to plant or otherwise scale capacity to meet anticipated food service demand;
G.  That the applicant has a willingness to work cooperatively with other local food hubs in the State to meet statewide demand for fresh food sourced in this State in a cost-effective manner; and
H.  That the applicant has an ownership or governance structure that inherently holds in high regard the value provided to the producer. Examples of such an ownership or governance structure include, but are not limited to, an entity that is a cooperative of fresh food producers in this State, or an entity whose bylaws require a majority of the board of directors to be fresh food producers in this State.
3.  Maine Food Hub Advisory Committee.   The commissioner shall establish the Maine Food Hub Advisory Committee, referred to in this subsection as "the advisory committee." The commissioner shall include representatives of statewide and regional organizations involved in supporting agriculture, public health, the environment and the state economy as part of the advisory committee. The advisory committee shall:
A.  Advise the department on definitions and the implementation and evaluation of applications for grants and loans under this section and shall review project results; and
B.  Advise the Department of Education on design and evaluation of the local foods training program under Title 20-A, section 6602, subsection 13.

The commissioner shall, where applicable, consult with the Department of Marine Resources and the Department of Education regarding the awarding of grants and loans under this section.

Sec. 4. 7 MRSA §434, sub-§1,  as amended by PL 2001, c. 152, §1, is further amended to read:

1. Agricultural enterprise.   "Agricultural enterprise" means a person or business located in this State and engaged in the commercial growing or harvesting of plants; raising of animals; growing or obtaining plant or animal by-products; aquaculture, as defined in Title 12, section 6001, subsection 1; or further processing, storing, packaging or marketing a raw product derived from plants, animals, plant or animal by-products or aquaculture, as defined in Title 12, section 6001, subsection 1, with the intent that the product be sold or otherwise disposed of to generate income. "Agricultural enterprise" includes a business or activity that attracts visitors to a farm for the purpose of supplementing income from the primary crop or livestock operation or that is a local food hub, pursuant to chapter 10-C. "Agricultural enterprise" does not include a business engaged primarily in the growing, harvesting or further processing of forest species of trees for the purpose of producing pulp or other materials used in the paper manufacturing or wood manufacturing process.

Sec. 5. 7 MRSA §435, sub-§2, ¶A,  as amended by PL 2003, c. 168, §1, is further amended to read:

A. An agricultural marketing loan for any project under this subchapter or section 320-B, subsection 2, the total cost of which exceeds $100,000, may not exceed 75% of the project cost. A loan from the fund may not be provided for such a project unless the applicant demonstrates a commitment of private funds of at least 5% of the total cost of the project; except that, in order to encourage the undertaking of cooperative projects by 2 or more agricultural enterprises, an agricultural marketing loan may not be provided unless the cooperating agricultural enterprises as a group demonstrate a commitment of private funds of at least 5% of the total cost of the project.

Sec. 6. 7 MRSA §435, sub-§2, ¶B,  as amended by PL 2003, c. 168, §1, is further amended to read:

B. An agricultural marketing loan for any project under this subchapter or section 320-B, subsection 2, the total cost of which is $100,000 or less, may not exceed 90% of the total cost of the project.

Sec. 7. 7 MRSA §435, sub-§2, ¶B-1  is enacted to read:

B-1.  An agricultural marketing loan for any project under chapter 10-C may not exceed 50% of the total cost of the project.

Sec. 8. 7 MRSA §435, sub-§2, ¶J  is enacted to read:

J.  When considering a local food hub loan under section 320-B, subsection 2, the commissioner is guided by the criteria established in chapter 10-C.

Sec. 9. 10 MRSA §1023-J, first ¶,  as amended by PL 2011, c. 380, Pt. OOO, §1 and c. 657, Pt. W, §6, is further amended to read:

The Agricultural Marketing Loan Fund, referred to in this section as the "fund," is created. The fund must be deposited with and maintained by the Finance Authority of Maine. The fund must be administered by the Commissioner of Agriculture, Conservation and Forestry in accordance with Title 7, chapter 101, subchapter 1-D. All money received by the Finance Authority of Maine from any source for the development and implementation of an improved agricultural marketing loan program must be credited to the fund. Any money credited to the fund from the issuance of bonds on behalf of the State for financing loans for agricultural enterprises may be used only for the following purposes: to provide assistance to agricultural enterprises in this State for the design, construction or improvement of commodity and storage buildings and packing and marketing facilities; for the purchase, construction or renovation of buildings, equipment, docks, wharves, piers or vessels used in connection with a commercial agricultural enterprise; for the purchase of land in connection with development of new cranberry acreage; for the purchase of land for irrigation reservoirs or to provide direct access to water for irrigation; for the purchase of land necessary for the start-up of a new agricultural enterprise; for the expansion of an existing agricultural enterprise when the land acquisition is necessary to comply with land use regulations; for the development of a business plan in accordance with the provisions of Title 7, section 436-A establishing local food hubs pursuant to Title 7, chapter 10-C; for improvements to pastureland, including seeding and actions to promote rotational grazing; or, if the commissioner so approves at the time of loan insurance commitment, to pledge money in the fund as security for, and to apply money in the fund to, payment of principal, interest and other amounts due on any term loans insured by the Finance Authority of Maine to an eligible dairy farmer. Repayment of these loans and interest on these loans must be credited to the fund and may be used for the purposes stated in this section or Title 7, section 436. Interest earned on money in the fund and interest earned on loans made from the fund may be used to pay the administrative costs of processing loan applications and servicing and administering the fund and loans and grants made from the fund since the inception of the agricultural marketing loan program, to the extent that these costs exceed the fee for administrative costs established by Title 7, section 435, subsection 4.

Sec. 10. 20-A MRSA §6602, sub-§12,  as enacted by PL 2001, c. 447, §1, is amended to read:

12. Local Produce Fund.   The Local Produce Fund is established within the Department of Education department. The fund is authorized to receive revenue from public and private sources. The fund must be held separate and apart from all other money, funds and accounts. Any balance remaining in the fund at the end of the fiscal year must be carried forward to the next fiscal year. The fund must be used to match $1 for every $3 a school administrative unit pays for produce or minimally processed foods purchased directly from a farmer or , farmers' cooperative or local food hub in the State, to a maximum state contribution of $1,000 or $2,000 if the school administrative unit sends a food service employee to local foods training administered by the department under subsection 13. At the end of the fiscal year, the school administrative unit may provide the department with receipts documenting purchases pursuant to this subsection during that year. For purposes of this subsection, "minimally processed" means only the washing, cleaning, trimming, drying, sorting and packaging of food items or a combination of those activities. Reimbursement or partial reimbursement to school administrative units may only be made up to the amount available in the fund. Failure to reimburse does not constitute an obligation on behalf of the State to a school administrative unit.

Sec. 11. 20-A MRSA §6602, sub-§§13 to 15  are enacted to read:

13.  Local foods training.   The department shall administer a program to encourage and expand the use of local foods in school food service programs. The program must:
A.  Provide competitive grants for a training program to be conducted in up to 6 regions to provide training throughout the State without cost for local school food service programs to encourage and expand the use of local foods, as defined in Title 7, section 320-A, subsection 1, in school food service programs. The training program must emphasize practical training for food preparers, including creative and effective cooking skills using local fresh foods and local food procurement skills. The training program must also emphasize the establishment of local food hubs established under Title 7, chapter 10-C within and across each region of the State that encourage the use of local foods in school food service programs;
B.  Foster collaboration between school food service programs throughout the State;
C.  Facilitate and encourage the use of local food hubs developed by the Department of Agriculture, Conservation and Forestry under Title 7, chapter 10-C; and
D.  Provide guidance to schools in the use of local food products and the nutritional attributes of local foods and provide strategies for encouraging maximum knowledge and acceptance of the nutritional value of locally produced food by students and communities.

The Maine Food Hub Advisory Committee, established under Title 7, section 320-B, subsection 3, shall advise the department on the design and evaluation of the program under this subsection.

14.  Food service program personnel; position description.   The department shall develop and post a position description for school food service program personnel on its publicly accessible website. The position description must meet the federal guidelines established under the Nutrition Education and Training Program and Team Nutrition initiative of the National School Lunch Program under 7 Code of Federal Regulations, Part 210.
15.  Food service recognition.   The department shall provide for the development of an annual competitive skill-oriented school food service recognition based on criteria developed by the department emphasizing creative and effective use of local food products to attract students to eat healthier meals and snacks and promoting community interest in good nutrition and other factors determined by the department.

Sec. 12. Advisory committee; pilot program. The Maine Food Hub Advisory Committee established in accordance with the Maine Revised Statutes, Title 7, section 320-B, subsection 3 must include to the extent possible, but is not limited to, representatives of the member entities of the farm-to-school work group established by Resolve 2009, chapter 106. The Commissioner of Agriculture, Conservation and Forestry may establish a local food hub pilot program if insufficient funding is available from the Agricultural Marketing Loan Fund under Title 10, section 1023-J for the local food hub program under Title 7, chapter 10-C. The Maine Food Hub Advisory Committee shall prepare and submit an evaluation of the overall effectiveness of the pilot program to the Department of Agriculture, Conservation and Forestry, the Department of Education and the Department of Marine Resources within 90 days following the completion of the pilot program.

Sec. 13. Appropriations and allocations. The following appropriations and allocations are made.

AGRICULTURE, CONSERVATION AND FORESTRY, DEPARTMENT OF

Division of Agricultural Resource Development 0833

Initiative: Provides an allocation in fiscal year 2014-15 for rule-making costs related to local food grants. These costs will later be reimbursed by the Finance Authority of Maine.

OTHER SPECIAL REVENUE FUNDS 2013-14 2014-15
All Other
 $0 $3,893
inline graphic sline.gif inline graphic sline.gif
OTHER SPECIAL REVENUE FUNDS TOTAL $0 $3,893

AGRICULTURE, CONSERVATION AND FORESTRY, DEPARTMENT OF
DEPARTMENT TOTALS 2013-14 2014-15
OTHER SPECIAL REVENUE FUNDS
 $0 $3,893
inline graphic sline.gif inline graphic sline.gif
DEPARTMENT TOTAL - ALL FUNDS $0 $3,893

EDUCATION, DEPARTMENT OF

Local Foods Training Fund N171

Initiative: Provides one-time funds to support competitive training grants for regional training programs for local food service program providers to encourage and expand the use of local foods in school food service programs.

GENERAL FUND 2013-14 2014-15
All Other
 $0 $30,000
inline graphic sline.gif inline graphic sline.gif
GENERAL FUND TOTAL $0 $30,000

Local Produce Fund N148

Initiative: Provides ongoing funds to increase the cap on the amount that the State matches for the acquisition of local foods by a school administrative district if the district sends a food service employee for training in the acquisition and use of local foods.

GENERAL FUND 2013-14 2014-15
All Other
 $0 $120,000
inline graphic sline.gif inline graphic sline.gif
GENERAL FUND TOTAL $0 $120,000

EDUCATION, DEPARTMENT OF
DEPARTMENT TOTALS 2013-14 2014-15
GENERAL FUND
 $0 $150,000
inline graphic sline.gif inline graphic sline.gif
DEPARTMENT TOTAL - ALL FUNDS $0 $150,000

SECTION TOTALS 2013-14 2014-15
GENERAL FUND
 $0 $150,000
OTHER SPECIAL REVENUE FUNDS
 $0 $3,893
inline graphic sline.gif inline graphic sline.gif
SECTION TOTAL - ALL FUNDS $0 $153,893
’

summary

This amendment, which retains the emergency preamble and clause, strikes and replaces the bill and is the minority report. The amendment requires the Department of Agriculture, Conservation and Forestry and the Department of Education to administer programs to support the expansion and coordination of the use of fresh Maine foods in aggregated and institutional markets, including school food service programs.

The Department of Agriculture, Conservation and Forestry is directed to provide grants under the Agricultural Development Grant program for the purpose of conducting market feasibility studies and developing business plans for local food hubs in Maine to connect and enhance relationships between fresh food producers in Maine and aggregated and institutional markets, including school food service programs. The Commissioner of Agriculture, Conservation and Forestry may not award a local foods grant unless the applicant provides matching funds in an amount that is no less than 50% of the grant amount.

The department is also directed to provide loans under the Agricultural Marketing Loan Fund to applicants in diverse geographic areas in the State for the purpose of establishing local food hubs located in Maine. Prior to awarding a local food hub loan, the Commissioner of Agriculture, Conservation and Forestry is required to determine that the potential overall impact of a proposal to Maine's agricultural economy and industry is beneficial to and in the best interest of the State. The amendment also provides that a loan for a local food hub project may not exceed 50% of the total cost of the project.

The amendment also establishes the Maine Food Hub Advisory Committee, which includes representatives of statewide and regional organizations involved in supporting agriculture, public health, the environment and the state economy, including representatives of the member entities of the farm-to-school work group established by Resolve 2009, chapter 106.

The amendment also directs the Department of Education to develop and support local food training programs for public school food service personnel and facilitate the use of local food hubs to expand the use of local foods in schools. The amendment retains the provision from the bill that increases the limit on the amount that the State matches for the acquisition of local food by a school administrative unit if the unit sends a food service employee for training in the acquisition and use of local foods. The amendment directs the department to develop and post a position description for school food service program personnel on its publicly accessible website and to develop an annual competitive skill-oriented school food service recognition.

The amendment also adds an appropriations and allocations section.

FISCAL NOTE REQUIRED
(See attached)

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