A bill to create an agricultural innovation fund for North Dakota value-added agricultural projects is being heard Wednesday, Feb. 17, in the state House Appropriations Committee.

House Bill 1475, authored by Rep. Bernie Satrom, R-Jamestown, with sponsors including Rep. Mitch Ostlie, Sen. Terry Wanzek and Sen. Cole Conley, all R-Jamestown, sets aside 20% of the proceeds from the Legacy Fund that would normally be deposited to the North Dakota General Fund for agricultural projects in the state.

"It is another tool for economic development," said Connie Ova, CEO of the Jamestown/Stutsman Development Corp. "It would have a high impact at Spiritwood."

The JSDC is a partner with Great River Energy in the Spiritwood Energy Park Association which operates a rail loop and other facilities for value-added agricultural operations at Spiritwood, N.D.

The transfer to the agricultural innovation fund is capped at $150 million per biennium and reduces the amount of the Legacy Fund proceeds deposited to the state's general fund. In July 2019, the Legacy Fund transferred $455 million to the general fund for the 2017-2019 biennium.

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On Feb. 8, the bill received a unanimous "do-pass" recommendation from the House Agricultural Committee. During that hearing, 15 people testified in favor of the bill with one neutral testimony.

Mark Watne, president of the North Dakota Farmers Union, said he believes this legislation "will play a key role in improving farmers and ranchers’ incomes, creating new jobs and building a stronger state economy."

Watne said the bill could be used to encourage slaughter plant operations in North Dakota improving livestock prices for producers.

The bill would place the new program within the operation of the Agricultural Product Utilization Commission administered by the North Dakota Department of Agriculture.

"APUC is a good fit for this because the nine-member commission is made up of people from a variety of backgrounds including agriculture, agribusiness, Department of Commerce and our land grant university," said Doug Goehring, North Dakota commissioner of agriculture.

Neutral testimony was presented by Samuel Wagner from the North Dakota Resource Council. Wagner said the program should only be available to North Dakota residents.

"Our stance is that North Dakotans should be the only people that should be allowed to benefit from the legacy fund or low-interest Bank of North Dakota Loans," he said, in written testimony to the committee.

The bill leaves it up to the Agricultural Products Utilization Commission to set guidelines for grants that include priorities for projects that have a majority ownership of North Dakota residents. The Bank of North Dakota, along with APUC, would set guidelines for loan programs from the fund.

All bills must be acted on by committees in their house of origin by Feb. 23 with final action in the originating chamber by Feb. 26.

The bill will now be heard in the House Appropriations Committee. Testimony can be streamed at video.legis.nd.gov.