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North Dakota Agriculture Commissioner Doug Goehring is hoping to see his department pick up a few more responsibilities if bills in the North Dakota Legislature pass. Photo taken Oct. 12, 2018. (Jenny Schlecht/Agweek)

Bills in ND Legislature would move grain inspection, Agricultural Products Utilization Commission to Ag Department

BISMARCK, N.D. — Proposals to move the Agricultural Products Utilization Committee and authority over grain buyers to the North Dakota Agriculture Department remain alive in the North Dakota Legislature.

The Legislature already rejected proposals that would have moved the state Milk Marketing Board and the North Dakota Trade Office to the Ag Department. The Trade Office will stay with the Department of Commerce, while the Milk Marketing Board will remain a stand-alone entity that is audited by the state auditor's office.

North Dakota Agriculture Commissioner Doug Goehring said he's pleased the Milk Marketing Board will stay where it is. However, said he's disappointed that the Trade Office will not become part of his agency and is hopeful that bills putting the Agricultural Products Utilization Committee and grain inspection under his purview will pass.

The Agricultural Products Utilization Committee, or APUC, currently resides in the Department of Commerce. Senate Bill 2328 would move it to the Ag Department.

"APUC is usually the first or only resource a company can access when researching opportunities to create new or expanded uses for North Dakota agricultural products," Sen. Shawn Vedaa, R-Velva, explained bill on the Senate floor.

APUC offers grants in the areas of basic and applied research, marketing and utilization, farm diversification, technical assistance, nature-based agritourism, and prototype development and technology.

Vedaa said APUC had seen its budget decrease in recent years from $3.1 million to $682,000. The agriculture commissioner already serves on the APUC board by statute, making the Agriculture Department "a perfect fit."

"Our committee believes a transfer of APUC to the Agriculture Department will add support to the program and allow an agriculture-connected elected official to be the guide behind budget proposals," he said.

The bill passed the Senate on a 42-5 vote and awaits action in the House.

Goehring said APUC used to fall under the Agriculture Department. After seeing the program cut in the last biennium, with no restoration this year amid a better financial situation for the state, Goehring said he wanted to see if he could get it moved.

Goehring has talked to the Bank of North Dakota about more potential funding sources for APUC and is confident that his department could do a better job of overseeing the program.

Similarly, he had hoped to see the Trade Office moved to his department after the Commerce Department recommended funding cuts to the program. But with the bill that would do so already dead, he said he'll look for other ways to help build trade relationships.

Meanwhile, House Bill 1467 would move authority over grain traders to the Agriculture Department from the Public Service Commission. Rep. Dennis Johnson, R-Devils Lake, did not mention by name the case of Hunter Hanson, a roving grain buyer now facing millions of dollars in claims against his businesses, when he spoke on the House floor. However, he referred to a present case that was a "failure" by the PSC to provide safeguards for farmers. The grain industry is regulated in 38 states, and in 34 of those states, it is the respective state's agriculture department doing the regulating, Johnson said.

He also said the North Dakota Department of Agriculture's regulation of the livestock industry, including sale barns and commission buyers, has been without the incidents that have affected the state's grain industry.

Representatives questioned whether the problem wasn't more that the PSC hadn't been given enough tools for regulation than that it wasn't the right agency for the job. But still the bill passed 85-8 and awaits action in the Senate.

Rep. Chet Pollert, R-Carrington, owns and operates G&R Grain and Feed in New Rockford. The House gave him permission to vote despite his conflict of interest on the bill. He said that HB 1467 is only one bill that deals with grain trade, and he expects "spirited debate" over that, a Senate bill that also deals with the issue and the PSC and Agriculture Department budgets.

Goehring said the Ag Department would do more to seek financial records of grain traders and put more resources into inspection. A major change he would make is to require cash sales to be paid within 30 days.

Goehring said moving grain inspection to his department would be "more involved" than moving APUC, but he is confident that his department could set up a better program than the PSC has. He would model a system for North Dakota off programs in other states in order to try to protect farmers, elevators and more.

"Our responsibility is to everybody in that value chain," he said.