The corn and soybean lobbies are gearing up for the Minnesota legislative session, ready to battle for a farm buffer tax credit, larger state deductions for capital equipment and more money for roads and bridges.
The state’s powerful farm lobby last year tried and failed to secure a $50 per acre tax credit for land in compliance with the state’s buffer law.
But some lawmakers didn’t think the tax credit should be funded using the 2008 Clean Water, Land and Legacy Amendment approved by voters, said Brian Thalmann, a farmer near Plato and president of the Minnesota Corn Growers Association. Finding a source of funding for the tax credit will be a priority for farmers this year, he said.
“Some had concerns about tapping into that fund for this purpose,” Thalmann said. “Our hope is that they’ll be able to determine a source of funding that’s acceptable to the legislators.”
Compensating farmers for the buffer land is a “dire need,” according to the Minnesota Soybean Growers Association.
“We want the state to recognize if there’s a public benefit to these water-quality buffers, they should not be putting the burden on the individual farmers, but rather paying for it in the form of local government aid,” said Joe Smentek, executive director of the Soybean Growers Association, in a statement.
Thalmann said he’s “very hopeful,” given that Gov. Tim Walz has expressed support for a buffer tax credit, saying in October, “You do a tax credit for those lands. You make it work.”
A second tax priority for farmers will be raising the state tax deduction for capital equipment spending. The federal Tax Cut and Jobs Act, signed by President Donald Trump, lifted the annual allowable deduction on federal taxes to $1 million. But Minnesota’s deduction limit remains at $25,000 and farmers want the state tax deduction rules to reflect the national tax code.
“Minnesota really should conform to the federal law to increase the deduction,” Thalmann said. “It provides significant tax relief for farmers and helps spur investment and we absolutely need encouragement to keep investing, which benefits the whole economy.”
The Corn Growers are also seeking $10 million for agricultural research at the University of Minnesota, recommending $262 million in funding for clean-water projects and programs, and greater funding for roads and bridges in rural Minnesota.
“We just have to keep supporting better funding to not only keep the roads and bridges up but to make some expansions,” Thalmann said. “The quality of the roads surface is deteriorating so fast.”
The Minnesota Soybean Growers Association are in lockstep with the Corn Growers on the tax issues and roads and bridges. They are also concerned with high health care costs for farmers, a patchwork of local seed regulations, protecting a summer biodiesel mandate and ditch mowing.
The first meeting of the House Agriculture and Food Finance and Policy Division is Tuesday.