Substitute For

HOUSE BILL NO. 5511

A bill to make appropriations for the department of agriculture and rural development for the fiscal year ending September 30, 2025; and to provide for the expenditure of the appropriations.

the people of the state of michigan enact:


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part 1

line-item appropriations

Sec. 101. There is appropriated for the department of agriculture and rural development for the fiscal year ending September 30, 2025, from the following funds:

DEPARTMENT OF AGRICULTURE AND RURAL DEVELOPMENT

 

 

 

APPROPRIATION SUMMARY

 

 

 

Full-time equated unclassified positions

6.0

 

 


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Full-time equated classified positions

549.0

 

 

GROSS APPROPRIATION

 

$

149,938,900

Interdepartmental grant revenues:

 

 

 

Total interdepartmental grants and intradepartmental transfers

 

 

332,400

ADJUSTED GROSS APPROPRIATION

 

$

149,606,500

Federal revenues:

 

 

 

Total federal revenues

 

 

20,357,900

Special revenue funds:

 

 

 

Total local revenues

 

 

0

Total private revenues

 

 

21,300

Total other state restricted revenues

 

 

47,170,900

State general fund/general purpose

 

$

82,056,400

Sec. 102. DEPARTMENTAL ADMINISTRATION AND SUPPORT

 

 

 

Full-time equated unclassified positions

6.0

 

 

Full-time equated classified positions

37.0

 

 

Unclassified salaries--FTEs

6.0

$

1,033,200

Accounting service center

 

 

1,177,400

Commissions and boards

 

 

23,800

Emergency management--FTEs

8.0

 

3,553,100

Emerging contaminants in food and agriculture--FTEs

6.0

 

2,109,900

Executive direction--FTEs

23.0

 

3,354,600

Property management

 

 

785,000

GROSS APPROPRIATION

 

$

12,037,000

Appropriated from:

 

 

 

Federal revenues:

 

 

 


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Deferred federal revenue funding

 

 

15,000

HHS, multiple grants

 

 

439,000

USDA, multiple grants

 

 

600,000

Special revenue funds:

 

 

 

Agriculture licensing and inspection fees

 

 

158,300

Dairy and food safety fund

 

 

219,600

Feed control fund

 

 

8,100

Fertilizer control fund

 

 

10,600

Freshwater protection fund

 

 

175,700

Gasoline inspection and testing fund

 

 

26,400

Industry support funds

 

 

57,000

Michigan craft beverage council fund

 

 

8,800

Private forestland enhancement fund

 

 

16,300

Refined petroleum fund

 

 

21,000

Weights and measures regulation fees

 

 

5,000

State general fund/general purpose

 

$

10,276,200

Sec. 103. INFORMATION TECHNOLOGY

 

 

 

Information technology services and projects

 

$

2,366,400

GROSS APPROPRIATION

 

$

2,366,400

Appropriated from:

 

 

 

Special revenue funds:

 

 

 

Agriculture licensing and inspection fees

 

 

93,000

Dairy and food safety fund

 

 

76,400

Feed control fund

 

 

15,000

Fertilizer control fund

 

 

15,000

Freshwater protection fund

 

 

15,000

Gasoline inspection and testing fund

 

 

32,400

State general fund/general purpose

 

$

2,119,600


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Sec. 104. FOOD SAFETY AND ANIMAL HEALTH

 

 

 

Full-time equated classified positions

212.0

 

 

Animal disease prevention and response--FTEs

63.0

$

11,103,000

Animal feed safety--FTEs

10.0

 

2,100,800

Food safety and quality assurance--FTEs

103.0

 

18,833,700

Indemnification - livestock depredation

 

 

15,000

Michigan animal agriculture alliance

 

 

3,000,000

Milk safety and quality assurance--FTEs

36.0

 

5,999,300

GROSS APPROPRIATION

 

$

41,051,800

Appropriated from:

 

 

 

Federal revenues:

 

 

 

HHS, multiple grants

 

 

3,244,200

USDA, multiple grants

 

 

1,209,500

Special revenue funds:

 

 

 

Agriculture licensing and inspection fees

 

 

72,900

Animal welfare fund

 

 

150,000

Consumer and industry food safety education fund

 

 

242,500

Dairy and food safety fund

 

 

5,506,700

Feed control fund

 

 

1,431,200

Industry food safety education fund

 

 

114,100

Marihuana regulation fund

 

 

350,000

Marihuana regulatory fund

 

 

349,900

State general fund/general purpose

 

$

28,380,800

Sec. 105. ENVIRONMENT AND SUSTAINABILITY

 

 

 

Full-time equated classified positions

120.5

 

 

Agricultural climate resiliency

 

$

1,000,000

Environmental stewardship - MAEAP--FTEs

27.0

 

10,825,300


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Local conservation districts

 

 

3,000,000

Pesticide and plant pest management--FTEs

82.0

 

14,506,900

Right-to-farm--FTEs

6.5

 

1,042,100

Soil health/Regenerative agriculture--FTEs

5.0

 

1,024,900

GROSS APPROPRIATION

 

$

31,399,200

Appropriated from:

 

 

 

Interdepartmental grant revenues:

 

 

 

IDG from MDEGLE, biosolids

 

 

95,600

Federal revenues:

 

 

 

Department of Interior

 

 

96,300

EPA, multiple grants

 

 

1,142,700

USDA, multiple grants

 

 

2,046,100

Special revenue funds:

 

 

 

Private - slow-the-spread foundation

 

 

21,300

Agriculture licensing and inspection fees

 

 

4,626,800

Fertilizer control fund

 

 

1,372,700

Freshwater protection fund

 

 

8,528,400

Horticulture fund

 

 

70,000

Industrial hemp fund

 

 

685,700

Industry support funds

 

 

228,100

State general fund/general purpose

 

$

12,485,500

Sec. 106. AGRICULTURE DEVELOPMENT

 

 

 

Full-time equated classified positions

71.0

 

 

Agricultural preservation easement grants

 

$

1,900,000

Agricultural support--FTEs

5.0

 

1,000,000

Agriculture development--FTEs

15.0

 

4,848,700

Fair food network - double up food bucks

 

 

4,000,000

Farm to family--FTEs

6.0

 

1,000,000


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Farmland and open space preservation--FTEs

10.0

 

1,638,000

Food and agriculture investment program

 

 

2,474,800

Food and agriculture supply chain--FTE

1.0

 

804,900

Fruit and vegetable inspections--FTEs

8.0

 

1,308,100

Intercounty drain--FTEs

5.0

 

883,800

Michigan craft beverage council--FTE

1.0

 

1,341,500

Migrant labor housing--FTEs

9.0

 

1,389,500

Producer security/grain dealers--FTEs

6.0

 

1,033,400

Qualified forest program--FTEs

4.0

 

8,107,000

Rural development fund grant program--FTE

1.0

 

2,008,200

GROSS APPROPRIATION

 

$

33,737,900

Appropriated from:

 

 

 

Federal revenues:

 

 

 

USDA, multiple grants

 

 

8,085,600

Special revenue funds:

 

 

 

Agricultural preservation fund

 

 

3,538,000

Agriculture licensing and inspection fees

 

 

5,100

Commodity inspection fees

 

 

700,300

Grain dealers fee fund

 

 

874,600

Industry support funds

 

 

223,600

Michigan craft beverage council fund

 

 

1,311,500

Migratory labor housing fund

 

 

145,100

Private forestland enhancement fund

 

 

1,080,100

Rural development fund

 

 

2,008,200

State general fund/general purpose

 

$

15,765,800

Sec. 107. LABORATORY PROGRAM

 

 

 

Full-time equated classified positions

108.5

 

 


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Central licensing and customer call center--FTEs

13.0

$

1,553,500

Consumer protection program--FTEs

42.0

 

7,179,900

Laboratory services--FTEs

42.5

 

8,873,900

USDA monitoring--FTEs

11.0

 

1,725,100

GROSS APPROPRIATION

 

$

19,332,400

Appropriated from:

 

 

 

Interdepartmental grant revenues:

 

 

 

IDG from LARA (LCC), liquor quality testing fees

 

 

236,800

Federal revenues:

 

 

 

EPA, multiple grants

 

 

180,600

HHS, multiple grants

 

 

1,572,600

USDA, multiple grants

 

 

1,726,300

Special revenue funds:

 

 

 

Agriculture licensing and inspection fees

 

 

356,400

Dairy and food safety fund

 

 

532,500

Feed control fund

 

 

194,900

Fertilizer control fund

 

 

25,500

Freshwater protection fund

 

 

48,500

Gasoline inspection and testing fund

 

 

1,932,500

Grain dealers fee fund

 

 

8,200

Industrial hemp fund

 

 

323,200

Migratory labor housing fund

 

 

31,200

Refined petroleum fund

 

 

3,520,700

Testing fees

 

 

358,700

Weights and measures regulation fees

 

 

755,300

State general fund/general purpose

 

$

7,528,500


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Sec. 108. FAIRS AND EXPOSITIONS

 

 

 

County fairs, shows, and expositions

 

$

500,000

Fairs and racing

 

 

258,600

Horse racing advisory commission

 

 

125,000

Michigan sired championship stakes

 

 

720,000

Purses and supplements - fairs/licensed tracks

 

 

1,353,600

Standardbred breeders' awards

 

 

345,900

Standardbred purses and supplements - licensed tracks

 

 

991,100

Standardbred sire stakes

 

 

720,000

GROSS APPROPRIATION

 

$

5,014,200

Appropriated from:

 

 

 

Special revenue funds:

 

 

 

Agriculture equine industry development fund

 

 

4,514,200

State general fund/general purpose

 

$

500,000

Sec. 109. ONE-TIME APPROPRIATIONS

 

 

 

Agricultural climate resiliency

 

$

5,000,000

GROSS APPROPRIATION

 

$

5,000,000

Appropriated from:

 

 

 

State general fund/general purpose

 

$

5,000,000

 

part 2

provisions concerning appropriations

for fiscal year 2024-2025

general sections

Sec. 201. In accordance with section 30 of article IX of the state constitution of 1963, for the fiscal year ending September 30, 2025, total state spending from state sources under part 1 is $129,227,300.00 and state spending under part 1 from state sources


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to be paid to local units of government is $11,800,000.00. The following itemized statement identifies appropriations from which spending to local units of government will occur:

DEPARTMENT OF AGRICULTURE AND RURAL DEVELOPMENT

 

 

 

Agriculture preservation easement grants

 

$

1,900,000

Environmental stewardship/MAEAP

 

 

4,100,000

Local conservation districts

 

 

3,000,000

Qualified forest program

 

 

1,400,000

Rural development fund grant program

 

 

1,400,000

TOTAL

 

$

11,800,000

Sec. 202. The appropriations under this part and part 1 are subject to the management and budget act, 1984 PA 431, MCL 18.1101 to 18.1594.

Sec. 203. As used in part 1 and this part:

(a) "Department" means the department of agriculture and rural development.

(b) "Director" means the director of the department.

(c) "Fiscal agencies" means the Michigan house fiscal agency and the Michigan senate fiscal agency.

(d) "FTE" means full-time equated.

(e) "IDG" means interdepartmental grant.

(f) "MAEAP" means the Michigan agriculture environmental assurance program.

(g) "MDEGLE" means the Michigan department of environment, Great Lakes, and energy.

(h) "Standard report recipients" means the senate and house appropriations subcommittees on agriculture and rural development, the senate and house fiscal agencies, the senate and house policy offices, and the state budget office.


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(i) "Subcommittees" means all members of the subcommittees of the house and senate appropriations committees with jurisdiction over the budget for the department.

(j) "TB" means tuberculosis.

(k) "USDA" means the United States Department of Agriculture.

Sec. 204. The department shall use the internet to fulfill the reporting requirements of this part. This requirement includes transmitting reports to the standard report recipients and any other required recipients by email and posting the reports on an internet site.

Sec. 205. To the extent permissible under section 261 of the management and budget act, 1984 PA 431, MCL 18.1261, all of the following apply to the expenditure of funds appropriated in part 1:

(a) The funds must not be used for the purchase of foreign goods or services, or both, if competitively priced and of comparable quality American goods or services, or both, are available.

(b) Preference must be given to goods or services, or both, manufactured or provided by Michigan businesses, if they are competitively priced and of comparable quality.

(c) Preference must be given to goods or services, or both, that are manufactured or provided by Michigan businesses owned and operated by veterans, if they are competitively priced and of comparable quality.

Sec. 206. The department shall not take disciplinary action against an employee of the department for communicating with a member of the legislature or legislative staff, unless the communication is prohibited by law and the department is exercising its authority as provided by law.


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Sec. 207. Consistent with section 217 of the management and budget act, 1984 PA 431, MCL 18.1217, the department shall prepare a report on out-of-state travel expenses not later than January 1. The report must list all travel by classified and unclassified employees outside this state in the previous fiscal year that was funded in whole or in part with funds appropriated in the department's budget. The department shall submit the report to the standard report recipients and to the senate and house appropriations committees. The report must include all of the following information:

(a) The dates of each travel occurrence.

(b) The total transportation and related expenses of each travel occurrence and the proportions funded with state general fund/general purpose revenues, state restricted revenues, federal revenues, and other revenues.

Sec. 208. The department shall not use funds appropriated in part 1 to hire a person to provide legal services that are the responsibility of the attorney general. This section does not apply to legal services for bonding activities or to outside legal services that the attorney general authorizes.

Sec. 209. Not later than December 15, the state budget office shall prepare and submit a report that provides estimates of the total general fund/general purpose appropriation lapses at the close of the previous fiscal year. The report must summarize the projected year-end general fund/general purpose appropriation lapses by major departmental program or program areas. The state budget office shall submit the report to the standard report recipients and to the chairpersons of the senate and house appropriations committees.


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Sec. 210. (1) In addition to the funds appropriated in part 1, there is appropriated an amount not to exceed $3,000,000.00 for federal contingency authorization. Amounts appropriated under this subsection are not available for expenditure until they have been transferred to another line item in part 1 under section 393(2) of the management and budget act, 1984 PA 431, MCL 18.1393.

(2) In addition to the funds appropriated in part 1, there is appropriated an amount not to exceed $2,000,000.00 for state-restricted contingency authorization. Amounts appropriated under this subsection are not available for expenditure until they have been transferred to another line item in part 1 under section 393(2) of the management and budget act, 1984 PA 431, MCL 18.1393.

(3) In addition to the funds appropriated in part 1, there is appropriated an amount not to exceed $100,000.00 for local-contingency authorization. Amounts appropriated under this subsection are not available for expenditure until they have been transferred to another line item in part 1 under section 393(2) of the management and budget act, 1984 PA 431, MCL 18.1393.

(4) In addition to the funds appropriated in part 1, there is appropriated an amount not to exceed $100,000.00 for private-contingency authorization. Amounts appropriated under this subsection are not available for expenditure until they have been transferred to another line item in part 1 under section 393(2) of the management and budget act, 1984 PA 431, MCL 18.1393.

Sec. 211. The department shall cooperate with the department of technology, management, and budget to maintain a searchable website accessible by the public at no cost that includes, but is not limited to, all of the following for the department:

(a) Fiscal year-to-date expenditures by category.


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(b) Fiscal year-to-date expenditures by appropriation unit.

(c) Fiscal year-to-date payments to a selected vendor, including the vendor name, payment date, payment amount, and payment description.

(d) The number of active department employees by job classification.

(e) Job specifications and wage rates.

Sec. 212. Not later than 14 days after the release of the executive budget recommendation, the department shall cooperate with the state budget office to provide an annual report on estimated state restricted fund balances, state restricted fund projected revenues, and state restricted fund expenditures for the previous 2 fiscal years. The report must be submitted to the standard report recipients and to the chairpersons of the senate and house appropriations committees.

Sec. 214. To the extent permissible under the management and budget act, 1984 PA 431, MCL 18.1101 to 18.1594, the director shall take all reasonable steps to ensure geographically disadvantaged business enterprises compete for and perform contracts to provide services or supplies, or both. The director shall strongly encourage firms with which the department contracts to subcontract with certified geographically disadvantaged business enterprises for services, supplies, or both. As used in this section, "geographically disadvantaged business enterprises" means that term as defined in Executive Directive No. 2019-08.

Sec. 215. On a quarterly basis, the department shall report on the number of full-time equated positions in pay status by civil service classification, including a comparison by line item of the number of full-time equated positions authorized from funds


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appropriated in part 1 to the actual number of full-time equated positions employed by the department at the end of the reporting period. The report must be submitted to the senate and house appropriations committees and to the standard report recipients.

Sec. 216. It is the intent of the legislature that the department maximize the efficiency of the state workforce and, if possible, prioritize in-person work, and post its in-person, remote, or hybrid work policy on its website.

Sec. 218. The department shall receive and retain copies of all reports funded from appropriations in part 1. The department shall follow federal and state guidelines for short-term and long-term retention of records. The department may electronically retain copies of reports unless otherwise required by federal and state guidelines.

Sec. 219. Not later than April 1, the department shall report on each specific policy change made to implement a public act affecting the department that took effect during the previous calendar year. The department shall submit the report to the standard report recipients, to the senate and house appropriations committees, and to the joint committee on administrative rules.

Sec. 221. To the extent possible, the department shall not expend appropriations under part 1 until all existing authorized work project funds available for the same purposes are exhausted.

Sec. 222. (1) Funds appropriated in part 1 must not be used to restrict or impede a marginalized community's access to government resources, programs, or facilities.

(2) From the funds appropriated in part 1, local governments shall report any action or policy that attempts to restrict or interfere with the duties of the local health officer.


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DEPARTMENTAL ADMINISTRATION AND SUPPORT

Sec. 301. (1) The department may establish a fee schedule and collect fees for the following work activities and services:

(a) Pesticide and plant pest management propagation and certification of virus-free foundation stock.

(b) Fruit and vegetable inspection and grading services at shipping and termination points and processing plants.

(c) Laboratory support analyses of food, livestock, and agricultural products for disease, foreign products for disease, toxic materials, foreign substances, and quality standards.

(d) Laboratory support test samples for other state and local agencies and public or private organizations.

(2) The department may receive and expend revenue from the fees authorized under subsection (1), subject to appropriation, to recover expenses associated with the work activities and services described in subsection (1). Fee revenue collected by the department under subsection (1) does not lapse to the state general fund at the end of the fiscal year but carries forward for appropriation by the legislature in the subsequent fiscal year.

(3) The department shall notify the subcommittees, the fiscal agencies, and the state budget office 30 days before proposing changes in fees authorized under this section or under section 5 of 1915 PA 91, MCL 285.35.

(4) On or before February 1 of each year, the department shall provide a report to the subcommittees, the fiscal agencies, and the state budget office detailing all the fees charged by the department under the authorization provided in this section, including, but not limited to, rates, number of individuals paying


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each fee, and the revenue generated by each fee in the previous fiscal year.

Sec. 302. (1) The department may contract with or provide grants to local units of government, institutions of higher education, or nonprofit organizations to support activities authorized by appropriations in part 1. As used in this section:

(a) "Contracts" includes, but is not limited to, contracts for delivery of groundwater/freshwater programs, MAEAP technical assistance, forest management, invasive species monitoring, wildlife risk mitigation.

(b) "Grants" includes, but is not limited to, grants promoting proper pesticide disposal, and research grants for the purpose of enhancing the agricultural industries in this state.

(2) The department shall provide notice of contracts or grants authorized under this section to the subcommittees, the fiscal agencies, and the state budget office not later than 7 days before the department notifies contract or grant recipients.

Sec. 303. (1) From the funds appropriated in part 1 for emerging contaminants in food and agriculture the department shall support efforts to identify and respond to the impacts of emerging contaminants to the food and agriculture sector, help address and mitigate current issues caused by emerging contaminants, and work to prevent and minimize future impacts. The department shall coordinate these efforts with other state agencies, federal agencies, tribal governments, local governments, institutions of higher learning, and the food and agriculture sector. Emerging contaminants include but are not limited to pesticides, dioxins, and per- and polyfluoroalkyl substances.

(2) The unexpended funds appropriated in part 1 for emerging


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contaminants in food and agriculture are designated as a work project appropriation, and any unencumbered or unallotted funds do not lapse at the end of the fiscal year and are available for expenditures for projects under this section until the projects have been completed. The following is in compliance with section 451a(1) of the management and budget act, 1984 PA 431, MCL 18.1451a:

(a) The purpose of the project support efforts to identify and respond to the impacts of emerging contaminants to the food and agriculture sector, help address and mitigate current issues caused by emerging contaminants, and work to prevent and minimize future impacts.

(b) The project will be accomplished by utilizing state employees or contracts with service providers, or both.

(c) The estimated cost of this project is $2,918,000.00.

(d) The tentative completion date for the work project is September 30, 2029.

 

FOOD and DAIRY

Sec. 401. (1) The department shall report on the previous fiscal year's activities of the food and dairy division. The report must include information on activities and outcomes of the dairy safety and inspection program, the food safety inspection program, the foodborne illness and emergency response program, and the food service program.

(2) The report must include information on significant foodborne outbreaks and emergencies, including any significant enforcement actions taken related to food safety during the prior calendar year.


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(3) The report must be transmitted to the subcommittees, the fiscal agencies, and the state budget office and posted to the department's website on or before April 1 of each year.

 

ANIMAL INDUSTRY

Sec. 451. From the funds appropriated in part 1, the department shall pay for all whole herd bovine TB testing costs and individual animal testing costs in the modified accredited zone and buffer counties as referenced in the current memorandum of understanding between the department and the USDA to maintain split-state status requirements. These costs include indemnity and compensation for injury causing death or downer to animals.

Sec. 452. (1) The department shall report on the previous calendar year's activities of the animal industry division. The department shall, by April 1, submit the report to the subcommittees, the fiscal agencies, and the state budget office and post the report to the department's website.

(2) The department shall include all of the following in the report:

(a) All indemnification payments for livestock depredation made in the previous calendar year and must include all of the following:

(b) The reason for the indemnification.

(c) The amount of the indemnification.

(d) The person for whom the indemnification was paid.

Sec. 454. The department shall use its resources to collaborate with the USDA to monitor bovine TB, consistent with the current required memorandum of understanding between the department and the USDA.


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Sec. 455. From the funds appropriated in part 1 for animal disease prevention and response, the department shall use $200,000.00 to cover costs associated with testing of registered privately owned cervid facilities as follows:

(a) Required surveillance testing for chronic wasting disease.

(b) Infected herd bovine TB testing.

Sec. 457. (1) On or before October 15 of each year, the department shall provide to the subcommittees, the fiscal agencies, and the state budget office a report on bovine TB status and department activities.

(2) For each fiscal quarter following the report required in subsection (1), the department shall provide an update to the subcommittees, the fiscal agencies, and the state budget office. The quarterly update reports must identify significant impacts to the program, including new incidence of bovine TB in this state, department activity associated with specific new incidence of bovine TB, any changes in USDA requirements or movement orders, and information and data on wildlife risk mitigation plan implementation in the modified accredited zone; implementation of a movement certificate process; progress toward annual surveillance test requirements; efforts to work with slaughter facilities in this state, as well as those that slaughter a significant number of animals from this state; and educational programs and information for this state's livestock community.

Sec. 458. From the funds appropriated in part 1 for Michigan animal agriculture alliance, the department shall work with animal industry representatives and state research universities to continue an animal research grant program.

 


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PESTICIDE AND PLANT PEST MANAGEMENT

Sec. 501. The department shall report on the previous calendar year's activities of the pesticide and plant pest management division. The report must be transmitted to the subcommittees, the fiscal agencies, and the state budget office and posted to the department's website on or before April 1 of each year.

Sec. 503. (1) Subject to subsection (5), from the funds appropriated in part 1 and section 901 for agricultural climate resiliency, the department shall establish an agricultural climate resiliency program.

(2) The purpose of the agricultural climate resiliency program described in this section is to promote the usage and implementation of best regenerative agricultural farming practices and new technologies related to environmental sustainability, including measures to address the impacts of climate change. Program goals include enhancing soil and plant health, soil carbon sequestration, efficient use of water, and protection of water resources.

(3) Through the program described in this section, the department shall also do all of the following:

(a) Promote the principles of soil health and regenerative agriculture, including maintaining soil cover, minimization of soil disturbance, plant and crop diversity, maintenance of live plants and roots, and integration of livestock into cropping systems.

(b) Promote the goals and principles of soil health and regenerative agriculture, including increasing soil organic matter content, improving soil water infiltration capacity, increasing soil water holding capacity, improving soil biological capacity to break down plant residue and other substances and to maintain soil


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aggregation, improving soil nutrient sequestration and cycling capacity, reducing nutrient losses, and increasing carbon sequestration capacity of soil.

(4) Program funds described in subsection (1) may not be used for applied research into the precision application of fertilizer, pesticides, or herbicides.

(5) Of the funds appropriated in part 1 and section 901 for agricultural climate resiliency, not less than $9,000,000.00 must be used by the department to partner with a state land-grant university to develop, implement, and evaluate a soil health, regenerative agriculture, and climate resiliency program. The partnership described in this subsection must be focused on researching and assisting the agricultural industry in implementing climate resiliency, soil health, and regenerative agricultural principles and techniques. Partnership goals must include, but are not limited to, establishing program priorities, developing metrics, implementing goals, evaluating outcomes, and engaging with stakeholders. A state land-grant university partner receiving funds as described in this subsection for agriculture climate resiliency shall comply with both of the following requirements concerning the funds:

(a) It shall use the funds for direct research support.

(b) It shall not charge the funds to the soil health, regenerative agriculture, and climate resiliency program for university indirect costs or administrative burden.

(6) In addition to the report required under section 501, by April 1, the department shall prepare a report to be posted on the department's website and provided to the relevant house and senate standing committees and appropriations subcommittees as well as to


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the fiscal agencies and state budget office. The report must provide information on the agricultural climate resiliency program, including department activities, uses of program funds by activity or project, contractors, grantees, and a summary of projects and project results.

Sec. 504. (1) Subject to subsection (2), from the funds appropriated in part 1 for soil health/regenerative agriculture, the department shall establish a program with the purpose of advancing the adoption of soil health and regenerative agriculture principles in agriculture in this state.

(2) The department may engage partners to achieve the purposes of the program described in this section, including agriculture extension offices, the national resources conservation service, conservation districts, and nongovernmental organizations to build farmer-to-farmer networks to disseminate practices and information to improve adoption of soil health and regenerative agriculture practices, and other needs that the department identifies to improve adoption of these principles. Program funds under this section may not be used for applied research into precision application of fertilizer, pesticides, or herbicides.

(3) Through the program described in this section, the department shall promote all of the following:

(a) The principles of soil health and regenerative agriculture, which include maintaining soil cover, minimization of soil disturbance, plant/crop diversity, maintenance of continual live plant/root, and integration of livestock into cropping systems.

(b) The goals of the principles of soil health and regenerative agriculture, which include increasing soil organic


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matter content, improving soil water infiltration capacity, increasing soil water holding capacity, improving soil biological capacity to break down plant residue and other substances and to maintain soil aggregation, improving soil nutrient sequestration and cycling capacity, reducing nutrient losses, and increasing carbon sequestration capacity of soil.

(c) The practices of soil health and regenerative agriculture, which include the use of no-till farming, intercropping, cover crops, multispecies cover crops, roll cropping, managed rotational grazing, and other practices identified that utilize natural biological processes to advance the goals of soil health and regenerative agriculture.

(4) The program's objectives for the program described in this section must be accomplished by utilizing state employees or contracts with service providers, or both. Any program partners receiving funding shall indicate the conservation outcomes they are intending to achieve and how they will measure achievement of those outcomes and provide a report to the department on the uses of funding received and achievement of any outcomes.

(5) In addition to the report required under section 501, by April 1, the department shall prepare a report to be posted on the department's website and provided to the relevant house and senate standing committees and appropriations subcommittees as well as to the fiscal agencies and state budget office. The report must provide information on the soil health and regenerative agriculture program, including department activities, uses of program funds by activity or project, contractors, grantees, and a summary of projects and project results.

 


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ENVIRONMENTAL STEWARDSHIP

Sec. 601. The funds appropriated in part 1 for environmental stewardship/MAEAP must be used to support department agriculture pollution prevention programs, including groundwater and freshwater protection programs under part 87 of the natural resources and environmental protection act, 1994 PA 451, MCL 324.8701 to 324.8717, and technical assistance in implementing conservation grants available under the federal farm bill.

Sec. 602. The department shall report on the previous calendar year's activities of the environmental stewardship division. The report must be transmitted to the subcommittees, the fiscal agencies, and the state budget office and posted to the department's website on or before April 1 of each year.

Sec. 603. In addition to the report required under section 602, by April 1, the department shall prepare a report to be posted on the department's website and provided to the relevant house and senate standing committees and appropriations subcommittees as well as to the fiscal agencies and state budget office. The report must contain the following information for agriculture nutrient best management voluntary practices program:

(a) The number and location of acres enrolled in nutrient management or other best management practices.

(b) The number of acres enrolled that were not previously verified under the MAEAP.

(c) A summary of practices implemented and available incentive programs.

(d) The starting and ending balances of the program.

(e) A summary of outreach and training efforts.

(f) Testing results.


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Sec. 604. The department may receive and expend federal revenues up to a total of $1,000,000.00 in excess of the federal revenue appropriated in section 105 of part 1 for environmental stewardship and MAEAP activities. The department shall notify the subcommittees, the fiscal agencies, and the state budget office prior to expending federal revenues authorized under this section.

Sec. 608. (1) The appropriations in part 1 for the qualified forest program are for the purpose of increasing the knowledge of nonindustrial private forestland owners of sound forest management practices and increasing the amount of commercial timber production from those lands.

(2) The department shall work in partnership with stakeholder groups and other state and federal agencies to increase the active management of nonindustrial private forestland to foster the growth of Michigan's timber product industry.

Sec. 609. (1) The appropriations in part 1 for local conservation districts must be distributed in equal amounts to local conservation districts in this state that were in operation as of April 15, 2021.

(2) On or before March 1, 2025, the department shall report on the previous calendar year's activities of local conservation districts. The report must include descriptions of local conservation district activities and funding, including uses of appropriations made in part 1. In preparing this report, the department shall coordinate with representatives of local conservation districts. The report must be transmitted to the subcommittees, the fiscal agencies, and the state budget office and posted to the department's website.

Sec. 610. From the funds appropriated in part 1, the


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department shall maintain coordination with the department of treasury to improve the timely processing and issuance of tax credits under section 36109 of the natural resources and environmental protection act, 1994 PA 451, MCL 324.36109, for the Michigan's farmland and open space preservation program under parts 361 and 362 of the natural resources and environmental protection act, 1994 PA 451, MCL 324.36101 to 324.3116 and 324.36201 to 324.36207. This includes, but is not limited to:

(a) Timely review of mailed applications and paperwork.

(b) Timely and proactive communications to applicants on the status of their application.

(c) A clear and understood timeline for the issuance of any tax credits.

 

LABORATORY PROGRAM

Sec. 651. The department shall report on the previous calendar year's activities of the laboratory division. The report must be transmitted to the subcommittees, the fiscal agencies, and the state budget office and posted to the department's website on or before April 1 of each year.

Sec. 652. No funds from the appropriations in part 1 may be used for the purpose of consolidating state-run laboratories.

 

AGRICULTURE DEVELOPMENT

Sec. 701. (1) From the funds appropriated in part 1 for the food and agriculture investment program, the department shall establish and administer a food and agriculture investment program.

(2) The food and agriculture investment program shall do all of the following:


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(a) Expand the Michigan food and agriculture sector.

(b) Promote food security.

(c) Develop local and regional food systems.

(d) Grow Michigan exports.

(e) Promote the development of value-added agricultural production.

(f) Support urban farms, food hubs, food incubators, and community-based processing facilities with a focus on new and expanding protein processors.

(g) Promote the expansion of farm markets, flower markets, and urban agriculture, including hoop houses.

(h) Increase food processing activities within this state by accelerating investment projects and infrastructure development that support growth in production agriculture and food and agriculture processing, expand opportunity to new agricultural producers and processors, promote agriculture tourism and agricultural heritage, and develop agricultural education and interpretation activities.

(3) In addition to the funds appropriated in part 1, the department may receive and expend funds received from outside sources for the food and agriculture investment program.

(4) Before the allocation of funding, all projects must receive approval from the Michigan commission of agriculture and rural development, except for projects selected through a competitive process by a joint evaluation committee selected by the director and consisting of representatives that have agriculture, food security, local and regional food systems, business, and economic development expertise. Projects funded through the food and agriculture investment program will be required to have a grant


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agreement that outlines milestones and activities that must be met in order to receive a disbursement of funds. Projects must also identify measurable project outcomes.

(5) The department shall include, in the agriculture development annual report, a report on the food and agriculture investment program for the previous fiscal year that includes a listing of the grantees, award amounts, match funding, project locations, and project outcomes.

(6) The unexpended funds appropriated in part 1 for the food and agriculture investment program are designated as a work project appropriation, and any unencumbered or unallotted funds do not lapse at the end of the fiscal year and are available for expenditures for projects under this section until the projects have been completed. The following is in compliance with section 451a(1) of the management and budget act, 1984 PA 431, MCL 18.1451a:

(a) The purpose of the project is to promote and expand the Michigan food and agriculture sector, grow Michigan exports, and increase food processing activities within the state.

(b) The project will be accomplished by utilizing state employees or contracts with service providers, or both.

(c) The estimated cost of this project is identified in the appropriation line item.

(d) The tentative completion date for the work project is September 30, 2026.

(7) The department may expend money from the funds appropriated in part 1 for the food and agriculture investment program, including all of the following activities:

(a) Grants.


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(b) Loans or loan guarantees.

(c) Infrastructure development.

(d) Other economic assistance.

(e) Program administration.

(f) Export assistance.

(8) The department shall expend no more than 5% from the funds appropriated in part 1 for the food and agriculture investment program for administrative purposes.

(9) In awarding grants under the food and agriculture investment program, the department shall identify and encourage applications from members of socially disadvantaged groups, women, veterans, and beginning farmers and ranchers. In awarding grants under the food and agriculture investment program, the department must also prioritize Michigan-based small businesses, nonprofits, and organizations promoting agriculture and food security activities.

Sec. 703. (1) From the funds appropriated in part 1 and section 901 for fair food network double up food bucks, the department shall work with the fair food network to ensure that at least 80% of the funds allocated to the double up food bucks program are directly used for the payments to participating vendors.

(2) The department shall work with the department of health and human services to do all of the following:

(a) Notify recipients of food assistance program benefits that food assistance program benefits can be accessed at many farmer's markets in this state with bridge cards.

(b) Notify recipients of food assistance program benefits about the double up food bucks program that is administered by the


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fair food network. Food assistance program recipients shall receive information about the double up food bucks program.

(3) The department shall work with the fair food network to expand access to the double up food bucks program in each of the state's counties with grocery stores or farmer's markets that meet the program's eligibility requirements.

(4) On or before June 1, 2025, the department shall submit a report on activities and outcomes of the double up food bucks program to the subcommittees and the fiscal agencies. The report must contain all of the following:

(a) Counties in this state with participating double up food bucks vendors, the number of vendors by county, and the name and location of vendors, as of May 1, 2023.

(b) Counties in this state with participating double up food bucks vendors, the number of vendors by county, and the name of location of vendors, as of May 1, 2024. The report must highlight counties and vendors added to the program since May 1, 2023.

(c) Number of individuals participating in the program, by county.

Sec. 706. (1) The department shall report on the previous calendar year's activities of the agriculture development division. The report must be transmitted to the subcommittees, the fiscal agencies, and the state budget office and posted to the department's website on or before April 1 of each year.

(2) The report described in subsection (1) must include the following information on any grants awarded during the prior fiscal year:

(a) The name of the grantee.

(b) The amount of the grant.


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(c) The purpose of the grant, including measurable outcomes.

(d) Additional state, federal, private, or local funds contributed to the grant project.

(e) The completion date of grant-funded activities.

(3) The report must include the following information on the Michigan craft beverage council established under section 303 of the Michigan liquor control code of 1998, 1998 PA 58, MCL 436.1303:

(a) Council activities and accomplishments for the previous fiscal year.

(b) Council expenditures for the previous fiscal year by category of administration, industry support, research and education grants, and promotion and consumer education.

(c) Grants awarded during the previous fiscal year and the results of research grant projects completed during the previous fiscal year.

(4) The report must identify grant recipients who are members of socially disadvantaged groups, women, veterans, and beginning farmers and ranchers.

Sec. 707. Unexpended industry support fund revenues at the end of the fiscal year may be carried forward into the industry support fund in the succeeding fiscal year and do not lapse to the general fund.

 

FAIRS and EXPOSITIONS

Sec. 801. All appropriations from the agriculture equine industry development fund may be spent on equine-related purposes. No funds from the agriculture equine industry development fund must be expended for non-equine-related purposes without prior approval of the legislature.


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Sec. 802. The funds appropriated in part 1 from the agriculture equine industry development fund must be allocated as follows:

(a) Before any funding is allocated as provided under subdivision (b) or (c), the funds must be allocated to support the actual costs of the Michigan gaming control board attributable to licensing and regulatory activities under the horse racing law of 1995, 1995 PA 279, MCL 431.301 to 431.336.

(b) If funds remain after the obligations under subdivision (a) are met and before funds are allocated as provided under subdivision (c), the remaining funds must be allocated to support the actual costs of the department in administering fair racing programs, awards, and supplements authorized under the horse racing law of 1995, 1995 PA 279, MCL 431.301 to 431.336.

(c) If funds remain after the obligations under subdivisions (a) and (b) are met, the remaining funds must be allocated for purses and supplements, breeders' awards, and sire stakes awards, in accordance with section 20 of the horse racing law of 1995, 1995 PA 279, MCL 431.320, including sire stakes awards for Michigan sired championship stakes as appropriated in part 1 and described in section 803.

Sec. 803. (1) Subject to subsection (2), from the funds appropriated in part 1 for Michigan sired championship stakes, $720,000.00 is designated for races run at a county fair exclusively for 2-year-old and 3-year-old Michigan sired standardbred horses.

(2) The appropriation in part 1 for Michigan sired championship stakes may be expended only if either of the following applies:


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(a) There is no standardbred race meeting in this state that is licensed under the horse racing law of 1995, 1995 PA 279, MCL 431.301 to 431.336.

(b) There is no standardbred race meeting in this state that is licensed as described in subdivision (a) and that has facilities capable of hosting Michigan sired standardbred stakes races as described under section 20(5)(i) of the horse racing law of 1995, 1995 PA 279, MCL 431.320.

(3) As used in this section, "Michigan sired standardbred horses" means that term as defined in section 20(5)(i) of the horse racing law of 1995, 1995 PA 279, MCL 431.320.

Sec. 805. (1) From the funds appropriated in part 1 for county fairs, shows, and expositions, the department shall establish and administer a county fairs, shows, and expositions grant program. The program must have the following objectives:

(a) Assist in the financing of building improvements or other capital improvements at county fairgrounds of this state.

(b) Provide financial support, promotion, prizes, and premiums of equine, livestock, and other agricultural commodity expositions in this state.

(2) The department shall award grants on a competitive basis to county fairs or other organizations from the funds appropriated in part 1 for county fairs, shows, and expositions grants. Grantees will be required to provide a 50% cash match with grant awards and identify measurable project outcomes. A county fair organization that received a county fair capital improvement grant in the prior fiscal year must not receive a grant from the appropriation in part 1.

(3) From the amount appropriated in part 1 for county fairs,


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shows, and expositions, up to $25,000.00 must be expended for the purpose of financial support, promotion, prizes, and premiums of equine, livestock, and other agricultural commodity expositions and festivals in this state.

(4) All fairs receiving grants under this section must provide a report to the department on the financial impact resulting from the capital improvement project on both fair and nonfair events. These reports are due for 3 years immediately following the completion of the capital improvement project.

(5) The department shall identify criteria, evaluate applications, and provide recommendations to the director for final approval of grant awards.

(6) The department may expend money from the funds appropriated in part 1 for the county fairs, shows, and expositions for administering the program.

(7) The unexpended portion of the appropriation in part 1 for county fairs, shows, and expositions grants are designated as a work project appropriation and any unencumbered or unallotted funds do not lapse at the end of the fiscal year and are available for expenditures for projects under this section until the projects have been completed. The following is in compliance with section 451a(1) of the management and budget act, 1984 PA 431, MCL 18.1451a:

(a) The purpose of the project is to support building improvements or other capital improvements at county fairgrounds of this state.

(b) All grants will be distributed in accordance with this section and the grant guidelines published prior to the request for proposals.


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(c) The project will be accomplished by utilizing state employees or contracts with service providers, or both.

(d) The estimated cost of the project is $2,500,000.00.

(e) The tentative completion date for the work project is September 30, 2026.

(8) The department shall provide a year-end report on the county fairs, shows, and expositions grants no later than December 1, 2025 to the subcommittees, the fiscal agencies, and the state budget director that includes a listing of the grantees, award amounts, match funding, project outcomes, and department costs of grant administration.

 

WORK PROJECT REPURPOSE

Sec. 901. From the unexpended and unencumbered funds appropriated in article 1 of 2021 PA 87 for agricultural nutrient best management voluntary practices program, the following appropriations must be made:

(a) $1,000,000.00 for fair food network - double up food bucks to be used by the department in accordance with Sec. 703.

(b) $3,000,000.00 for agricultural climate resiliency to be used by the department in accordance with Sec. 503.

(c) $850,000.00 to the Michigan craft beverage council.

(d) $150,000.00 to the Flint Farmers' Market.