KENTUCKY (5/12/13) - Farmers, food banks, and grain producers are among those that will benefit from $2.212 million in agricultural development funds approved by the state Agricultural Development Board in April, a state legislative committee learned on May 1.
While the money will fund 12 different projects, the bulk of the funds—or $2 million—goes to Meade County Riverport Authority as a one-percent interest loan to help set up a regional port facility for grain producers, Kentucky Agricultural Finance Corporation official Bill McCloskey told the General Assembly’s Tobacco Settlement Agreement Fund Oversight Committee.
To secure the state loan, McCloskey said the facility will be leased to Consolidated Grain and Barge and a usage fee will be paid for cargo entering or leaving the port. The total cost of the project is $5.6 million, with Consolidated providing $3.6 million of the construction and installation cost, according to the McCloskey. The remainder will be covered by the $2 million loan, which will be repaid over 20 years.
Governor’s Office of Agricultural Policy (GOAP) Executive Director Roger Thomas said the loan agreement “guarantees that this money will be repaid,” although the committee’s co-chair, Sen. Paul Hornback, R-Shelbyville, said he had concerns with the facility being overseen by one company. Consolidated Grain and Barge will have authority over operations since it holds the lease, the committee was told by McCloskey.
Also approved was a total of $1,750 in multi-county funds to study the feasibility of building a regional meat processing facility for Henry, Oldham, Shelby, and Trimble counties, and up to $75,000 in state funds for the Kentucky Association of Food Banks’ (KAFB) surplus farm produce program—provided that up to $75,000 in county funds are also committed to the project.
Called Farms to Food Banks, the program buys edible surplus produce and so-called “seconds” (food that is edible but not suitable for retail sale) from farmers and distributes it through the state’s food bank and food pantry network. The program was initiated in 2009 as a pilot project by God’s Pantry Food Bank and was expanded statewide in 2011 with $163,000 in state agricultural development funds, said GOAP Chief of Staff Joel Neaveill.
Farms to Food Banks distributed almost one million pounds of surplus produce across Kentucky in 2012, said Neaveill. A total 217 farmers participated, with each farmer netting around $973, he said.
“This just provides some level of payment to producers for (food) that would otherwise lie fallow in the fields,” Neaveill told the committee.
Committee co-chair Rep. Wilson Stone, D-Scottsville, said Farms to Food Banks is a good “self help” program that benefits both the grower and the consumer. “…It’s also a market …. for something that’s basically unmarketable without this kind of (program),” he said.
Senate Bill 1, sponsored by Senate President Robert Stivers, R-Manchester, and enacted during the 2013 Regular Session, will give Kentucky farmers who donate their surplus food products to nonprofit food banks and food pantries a nonrefundable 10-percent state income tax credit. The credit, offered between 2014 and 2018, will be against the value of donated products. The provisions are similar to those found in 2013 House Bill 141, sponsored by House Agriculture and Small Business Committee Chairman Tom McKee, D-Cynthiana, and Rep. Mike Denham, D-Maysville.
“I think that we will see some farmers take advantage of it,” McKee said of the legislation.
McKee said he has talked to officials with the Kentucky Association of Food Banks about the possibility of acquiring county matching funds for the program, and believes the matching funds will be provided. “It looks like they’ll get the matching money, so they’ll have $150,000, and this program will move forward and continue to feed people who are hungry in Kentucky—and it’ll also benefit farmers,” said McKee.
The first meeting of the Interim Joint Committee on Agriculture will be held at God’s Pantry Food Bank in Lexington, said McKee, who co-chairs the committee. That meeting is scheduled for June 13 at 10 a.m.
Have a good week.
Rep. Brent Yonts
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