HOUSE BILL No. 6002


     September 27, 2000, Introduced by Rep. Julian and referred to the Committee on Agriculture and Resource Management.


        A bill to create incentives to locate and maintain

   value-added agricultural processing and production ventures

   within this state; to create certain funds and advisory boards;

   to authorize expenditures and grants from the funds; to finance

   the development of certain programs; to provide for appropria-

   tions; and to prescribe the powers and duties of certain state

   officials.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

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           Sec. 1.  This act shall be known and may be cited as the

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      "agricultural development fund act".

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           Sec. 2.  The legislature of this state finds and declares

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      that there exists in this state continuing need for programs to

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      assist in encouraging value-added agricultural processing and

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      agricultural production ventures and consequent job creation and

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      ancillary economic growth within this state.


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           Sec. 3.  As used in this act:

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           (a) "Agricultural processing" means 1 or more operations

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      that transform, package, sort, or grade livestock or livestock

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      products, agricultural commodities, or plants or plant products

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      into goods that are used for intermediate or final consumption

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      including goods for nonfood use.

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           (b) "Department" means the Michigan department of

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      agriculture.

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           (c) "Fund" means the agricultural development fund created

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      in section 4.

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           (d) "Value added" means the enhancement or improvement of

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      the overall value of an agricultural commodity or of an animal or

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      plant product into a product of higher value.  The enhancement or

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      improvement includes, but is not limited to, marketing, process-

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      ing, transforming, or packaging.

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           Sec. 4.  (1) The agricultural development fund is created

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      within the department of treasury and is to be administered by

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      the department.  Money in the fund at the close of the fiscal

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      year shall remain in the fund and shall not lapse to the general

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      fund.

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           (2) The state treasurer shall credit money from the follow-

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      ing sources to the fund:

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           (a) Appropriations.

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           (b) Money from the uncollectibles allowance fund created in

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      R 460.2135 of the Michigan administrative code as well as money

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      from any other source provided by law.





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           (c) Interest earnings on deposits in the fund that accrue

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      interest as a participating fund of the state's common cash

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      fund.

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           (3) The purpose of the fund is to make grants intended to

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      increase value-added processing ventures and to expand agricul-

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      tural processing and agricultural production in targeted areas.

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      The grantees must be organizations whose purpose includes

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      value-added agricultural processing and agricultural production

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      that is consistent with the purposes of this act.

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           (4) The department shall use the fund to make grants to

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      qualified grantees who apply for such grants and who submit pro-

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      posals demonstrating feasibility for development of value-added

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      agricultural processing and agricultural production ventures con-

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      sistent with the purposes described in this act.  Funded activi-

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      ties include, but are not limited to, marketing research, busi-

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      ness plan development, market development, and utilization of

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      technology designed to establish, retain, expand, attract, or

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      develop value-added agricultural processing and agricultural pro-

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      duction operations in this state.

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           (5) The director of the department shall have final approval

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      of grants made under this act.  Grants are contingent upon the

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      availability of funds.

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           (6) The director of the department may impose fiduciary

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      obligations upon a recipient of a grant, including performance

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      bonding, and may impose conditions upon the receipt and expendi-

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      ture of the grant money.





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           Sec. 5.  (1) There is created an agriculture development

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      advisory board consisting of 5 members whose purpose is to review

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      and recommend to the department proposals for grants under this

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      act.  The members shall be appointed by the governor and serve at

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      his or her pleasure.

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           (2) The board shall be no larger than 5 members.  Membership

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      on the board shall include at least 3 producers, 1 representing

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      plant product producers, 1 representing animal product producers,

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      and 1 representing at-large producers.

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           Sec. 6.  The department may designate a primary point of

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      contact for the activities conducted under this act and shall

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      establish a mission statement and objectives to be made available

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      to the general public and to the processing and agricultural

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      industries.

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           Sec. 7.  It is intended that the legislature shall appropri-

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      ate each year from the agricultural development fund to the

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      department an amount sufficient to make the grants described in

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      section 4.





















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