ST. PAUL — Farmer Richard Syverson describes it as “odd” that Minnesota would be looking at a fee increase on fertilizer when the state is so flush with money.
As part of the budget request from Gov. Tim Walz, the Minnesota Department of Agriculture budget is seeking a fee increase of 25 cents on every ton of fertilizer sold.
The current fee in Minnesota is 39 cents per ton, collected by the retailer.
“It just seems like this is an odd time where the governor will propose a fee increase with the state running a big budget surplus,” said Syverson, who farms near Benson in central Minnesota, and is the president of the Minnesota Corn Growers Association.
But with Minnesota having a projected budget surplus of $17.6 billion , he wonders why the need to “nickel and dime” farmers, especially when fertilizer prices have been volatile.
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“The way I heard it explained was, it’s the price of a cup of coffee," Syverson said. "Well, we're already paying for the doughnut and now another cup of coffee. Pretty soon we’ll be buying steaks for everybody.”
Andrea Vaubel of the Minnesota Department of Agriculture said the agency estimates it will cost farmers another 5.7 cents per corn acre with the proposed fee increase. For a 640 acre section, that's about $36.50.
Patrick Murray, executive director of the Minnesota Crop Production Retailers Association, said in an interview that it seems like money from the state general fund could be used to bolster the Ag Department budget, ”so that they're not putting it on the end user or the industry itself.”
In an interview, Vaubel said the department was open to using the general fund to pay for this proposed increase.
"We are very open to other means to cover the needs of the program, if that is general fund or whatever," Vaubel said.
In a budget presentation to the Minnesota House Committee on Agriculture Finance and Policy, Minnesota Department of Agriculture staff said the fee increase will generate about $750,000 a year to go into a fund dedicated to inspecting and permitting fertilizer storage sites.
It is one of the ways Minnesota is working to protect groundwater from nitrogen runoff.
Rep. Bobbie Harder, a Republican who farms in Sibley County is in her first term in the Minnesota House.
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“Just a reminder, it can be a struggle to be a farmer and it is right now with the uncertain times and the increase of costs. And this is just one more burden that you're going to be adding on to farmers that we have to somehow bear. Just keep that in mind on your request,” Harder said.
"We take that very seriously," Agriculture Commissioner Thom Petersen responded.
Josh Stamper, who works in pesticide and fertilizer management with the Agriculture Department, said there has been a lot of consolidation in the fertilizer industry in the last 30 years.
“And as these facilities grow and expand, the permitting requirements are commensurate with that size,” he said.
The money collected also is used to investigate the source of nitrogen contamination in groundwater.
“We need to make sure that regulations that are associated with the application of fertilizer to agricultural fields, that groundwater contamination is not actually coming from point sources, meaning the facilities that store and handle fertilizer are not contributing to groundwater contamination,” Stamper said.
Republican Rep. Paul Anderson, a farmer from Starbuck, asked if less anhydrous ammonia use meant less time needed for inspections.
Stamper said dealers have been moving away from anhydrous ammonia, which he called the most dangerous type of fertilizer, because their farmer customers are less interested in it. But he said the move is to urea.
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“Urea is stored on concrete pads at every facility within the state. And anyone who has lived in Minnesota for an extended period of time knows that there's two types of concrete in Minnesota — that has cracked and that is going to crack," Stamper said, adding that the majority of the cleanups are associated with dry fertilizer facilities where there is urea.
Rep. Steven Jacob, asked why more attention isn’t given to lawn fertilizer, that he said was widely used in his home area of Winona County and along Lake Winona on the Mississippi River.
Stamper said of the roughly 3 million tons of fertilizer sold in Minnesota each year, lawn fertilizer only makes up about 5% of that and phosphorus has been banned for lawn use.
Murray noted that the budget presentation was not in bill form and will be following to see what the bill language looks like. While Democrats control the House, Senate and the governor’s office, the ag budget bills may still have some differences.
“So that's where it will come down to the industry and where folks are trying to influence the process by saying ‘this is a good idea, or bad idea, or is there another way that we can do this?’” Murray said.
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