Tax breaks for biofuels, grain bin construction among ag bills passed in North Dakota

BISMARCK — Among the flurry of farming-related bills in front of the North Dakota Legislature are three bills that would provide tax breaks on agriculture-related construction.

Just past the midway point of the 2023 session, it's been a busy session for agriculture, with the top headlines being about changes in corporate farming laws to promote livestock and keeping farmland out of foreign ownership.

Legislators return to the Capitol March 1 after a mid-session recess. Here’s a look at some of the bills that are still alive in the second half of the session:

HB 1430: Creates a sale and use tax exemption for materials used in construction, expansion, or environmental upgrade of a renewable feedstock refinery, which would include ethanol plants and biodiesel.

Jeff Zueger, the CEO of Midwest Ag Energy — which owns two ethanol plants in North Dakota, Blue Flint in Underwood and Dakota Spirit in Spiritwood — is also a director on the North Dakota Ethanol Producers Association board.

In written testimony, he said “several plants have worked to lower the carbon intensity of our fuel by implementing carbon capture and storage projects. Sustainable aviation fuel (SAF) is a promising opportunity that would open a new market for low carbon North Dakota ethanol. Midwest AgEnergy is currently engaged in evaluating the potential to produce SAF from the low carbon ethanol we produce as will be others that employ carbon reduction technologies.”

HB 1370: Sales tax exemption for materials to build grain bins. In written testimony, Matt Perdue of the North Dakota Farmers Union said, “The grain bin sales tax exemption is modeled after a policy that has existed in Iowa since 2019. During conversations with the new soybean crush plants, NDFU and other groups learned about those facilities’ interest in expanding on-farm storage. We believe HB 1370 is an important step toward supporting that expansion."

SB 2279: Provides a property tax exemption for ag storage facilities and some other improvements. To qualify for the exemption, it can’t be rented to someone other than a relative.

While HB 1430 mentioned above could provide a tax break for carbon capture and storage construction, Sen. Jeff Magrum filed eight bills related to strengthening the position of landowners against the effort to build carbon capture pipelines in the states.

Only two have survived so far:

SB 2251 : This requires survey crews to obtain written permission from property owners. There are currently multiple lawsuits involving pipeline company Summit Carbon Solutions and landowners over surveyor access.

SB 2313 : If property is taken by eminent domain, a court must increase the award by 33%.

Both those bills are now in the House Energy and Natural Resources Committee.

The biggest ag policy change will likely be in redefining feedlots and dairies to make them exempt from state law restricting corporate ownership of farm. While North Dakota Farmers Union did not endorse HB 1371 it did provide input into amendments that helped it pass the House .

Here are a couple other bills promoting livestock that have survived:

• HB 1423 to develop uniform zoning across counties and townships.
• SB 2373 creates a livestock friendly county designation.

Something legislators can agree on is keeping North Dakota land out of foreign ownership.

HB 1135 , which would bar foreign governments and businesses they control from purchasing, acquiring or holding any interest in agricultural land in the state , passed 93-0.

HB 1503 , which seeks to prohibit foreign ownership of real property in North Dakota, passed the House 93-0.

Some western North Dakota farmers love cloud seeding, others don't.  

HB 1166, which could limit a county's ability to get state funding for weather modification , passed the House on a 69-22 vote.

Rep. Dawson Holle, a dairy farmer from Morton County, backed two milk related bills:

• HB 1515 would allow dairy farms to sell raw milk at their farms but would prohibit farms from selling raw milk to grocery stores or wholesalers.
• HB1255 would clarify in state law that “milk” is a “lacteal secretion” obtained from a hoofed mammal.