Eligibility for the Dairy Assistance, Investment, Relief Initiative (DAIRI) program modified.

A bill for an act

relating to agriculture; modifying eligibility for the Dairy Assistance, Investment,

Relief Initiative (DAIRI) program; amending Laws 2023, chapter 43, article 1,

section 2, subdivision 4, as amended.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Laws 2023, chapter 43, article 1, section 2, subdivision 4, as amended by Laws

2024, chapter 126, article 1, section 1, and Laws 2025, chapter 34, article 1, section 9, is

amended to read:

Subd. 4.

Agriculture, Bioenergy, and Bioproduct

Advancement

34,034,000

38,159,000

(a) $10,702,000 the first year and $10,702,000

the second year are for the agriculture

research, education, extension, and technology

transfer program under Minnesota Statutes,

section
41A.14
. Except as provided below,

the appropriation each year is for transfer to

the agriculture research, education, extension,

and technology transfer account under

Minnesota Statutes, section
41A.14,

subdivision 3
, and the commissioner shall

transfer funds each year to the Board of

Regents of the University of Minnesota for

purposes of Minnesota Statutes, section

41A.14
. To the extent practicable, money

expended under Minnesota Statutes, section

41A.14, subdivision 1
, clauses (1) and (2),

must supplement and not supplant existing

sources and levels of funding. The

commissioner may use up to one percent of

this appropriation for costs incurred to

administer the program.

Of the amount appropriated for the agriculture

research, education, extension, and technology

transfer grant program under Minnesota

Statutes, section
41A.14
:

(1) $600,000 the first year and $600,000 the

second year are for the Minnesota Agricultural

Experiment Station's agriculture rapid

response fund under Minnesota Statutes,

section
41A.14, subdivision 1
, clause (2);

(2) up to $1,000,000 the first year and up to

$1,000,000 the second year are for research

on avian influenza, salmonella, and other

turkey-related diseases and disease prevention

measures;

(3) $2,250,000 the first year and $2,250,000

the second year are for grants to the Minnesota

Agricultural Education Leadership Council to

enhance agricultural education with priority

given to Farm Business Management

challenge grants;

(4) $450,000 the first year is for the cultivated

wild rice breeding project at the North Central

Research and Outreach Center to include a

tenure track/research associate plant breeder;

(5) $350,000 the first year and $350,000 the

second year are for potato breeding;

(6) $802,000 the first year and $802,000 the

second year are to fund the Forever Green

Initiative and protect the state's natural

resources while increasing the efficiency,

profitability, and productivity of Minnesota

farmers by incorporating perennial and

winter-annual crops into existing agricultural

practices. The base for the allocation under

this clause is $802,000 in fiscal year 2026 and

each year thereafter. By February 1 each year,

the dean of the College of Food, Agricultural

and Natural Resource Sciences must submit

a report to the chairs and ranking minority

members of the legislative committees with

jurisdiction over agriculture finance and policy

and higher education detailing uses of the

funds in this paragraph, including

administrative costs, and the achievements

these funds contributed to;

(7) $350,000 each year is for farm-scale winter

greenhouse research and development

coordinated by University of Minnesota

Extension Regional Sustainable Development

Partnerships. The allocation in this clause is

onetime;

(8) $200,000 the second year is for research

on natural stands of wild rice; and

(9) $250,000 the second year is for the

cultivated wild rice forward selection project

at the North Central Research and Outreach

Center, including a tenure track or research

associate plant scientist.

(b) The base for the agriculture research,

education, extension, and technology transfer

program is $10,352,000 in fiscal year 2026

and $10,352,000 in fiscal year 2027.

(c) $23,332,000 the first year is for the

agricultural growth, research, and innovation

program under Minnesota Statutes, section

41A.12
. Except as provided below, the

commissioner may allocate this appropriation

among the following areas: facilitating the

start-up, modernization, improvement, or

expansion of livestock operations, including

beginning and transitioning livestock

operations with preference given to robotic

dairy-milking equipment; assisting

value-added agricultural businesses to begin

or expand, to access new markets, or to

diversify, including aquaponics systems, with

preference given to hemp fiber processing

equipment; facilitating the start-up,

modernization, or expansion of other

beginning and transitioning farms, including

by providing loans under Minnesota Statutes,

section
41B.056
; sustainable agriculture

on-farm research and demonstration; the

development or expansion of food hubs and

other alternative community-based food

distribution systems; enhancing renewable

energy infrastructure and use; crop research,

including basic and applied turf seed research;

Farm Business Management tuition assistance;

and good agricultural practices and good

handling practices certification assistance. The

commissioner may use up to 6.5 percent of

this appropriation for costs incurred to

administer the program.

Of the amount appropriated for the agricultural

growth, research, and innovation program

under Minnesota Statutes, section
41A.12
:

(1) $1,000,000 the first year is for distribution

in equal amounts to each of the state's county

fairs to preserve and promote Minnesota

agriculture;

(2) $5,750,000 the first year is for incentive

payments under Minnesota Statutes, sections

41A.16
,
41A.17
,
41A.18
, and
41A.20
.

Notwithstanding Minnesota Statutes, section

16A.28
, the first year appropriation is

available until June 30, 2025. If this

appropriation exceeds the total amount for

which all producers are eligible in a fiscal

year, the balance of the appropriation is

available for other purposes under this

paragraph;

(3) $3,375,000 the first year is for grants that

enable retail petroleum dispensers, fuel storage

tanks, and other equipment to dispense

biofuels to the public in accordance with the

biofuel replacement goals established under

Minnesota Statutes, section
239.7911
. A retail

petroleum dispenser selling petroleum for use

in spark ignition engines for vehicle model

years after 2000 is eligible for grant money

under this clause if the retail petroleum

dispenser has no more than 10 retail petroleum

dispensing sites and each site is located in

Minnesota. The grant money must be used to

replace or upgrade equipment that does not

have the ability to be certified for E25. A grant

award must not exceed 65 percent of the cost

of the appropriate technology. A grant award

must not exceed $200,000 per station. The

commissioner must cooperate with biofuel

stakeholders in the implementation of the grant

program. The commissioner, in cooperation

with any economic or community development

financial institution and any other entity with

which the commissioner contracts, must

submit a report on the biofuels infrastructure

financial assistance program by January 15 of

each year to the chairs and ranking minority

members of the legislative committees and

divisions with jurisdiction over agriculture

policy and finance. The annual report must

include but not be limited to a summary of the

following metrics: (i) the number and types

of projects financed; (ii) the amount of dollars

leveraged or matched per project; (iii) the

geographic distribution of financed projects;

(iv) any market expansion associated with

upgraded infrastructure; (v) the demographics

of the areas served; (vi) the costs of the

program; and (vii) the number of grants to

minority-owned or female-owned businesses;

(4) $1,250,000 the first year is for grants to

facilitate the start-up, modernization, or

expansion of meat, poultry, egg, and milk

processing facilities. A grant award under this

clause must not exceed $200,000. Any

unencumbered balance at the end of the second

year does not cancel until June 30, 2026, and

may be used for other purposes under this

paragraph;

(5) $1,150,000 the first year is for providing

more fruits, vegetables, meat, poultry, grain,

and dairy for children in school and early

childhood education settings, including, at the

commissioner's discretion, providing grants

to reimburse schools and early childhood

education and child care providers for

purchasing equipment and agricultural

products. Organizations must participate in

the National School Lunch Program or the

Child and Adult Care Food Program to be

eligible. Of the amount appropriated, $150,000

is for a statewide coordinator of

farm-to-institution strategy and programming.

The coordinator must consult with relevant

stakeholders and provide technical assistance

and training for participating farmers and

eligible grant recipients;

(6) $2,000,000 the first year is for urban youth

agricultural education or urban agriculture

community development;

(7) $1,000,000 the first year is for the good

food access program under Minnesota

Statutes, section
17.1017
; and

(8) $225,000 the first year is to provide grants

to secondary career and technical education

programs for the purpose of offering

instruction in meat cutting and butchery.

Notwithstanding Minnesota Statutes, section

16B.98, subdivision 14
, the commissioner may

use up to 6.5 percent of this appropriation for

administrative costs. This is a onetime

appropriation. Grants may be used for costs,

including but not limited to:

(i) equipment required for a meat cutting

program;

(ii) facility renovation to accommodate meat

cutting; and

(iii) training faculty to teach the fundamentals

of meat processing.

A grant recipient may be awarded a grant of

up to $75,000 and may use up to ten percent

of the grant for faculty training. Priority may

be given to applicants who are coordinating

with meat cutting and butchery programs at

Minnesota State Colleges and Universities

institutions or with local industry partners.

By January 15, 2025, the commissioner must

report to the chairs and ranking minority

members of the legislative committees with

jurisdiction over agriculture finance and

education finance by listing the grants made

under this paragraph by county and noting the

number and amount of grant requests not

fulfilled. The report may include additional

information as determined by the

commissioner, including but not limited to

information regarding the outcomes produced

by these grants. If additional grants are

awarded under this paragraph that were not

covered in the report due by January 15, 2025,

the commissioner must submit an additional

report to the chairs and ranking minority

members of the legislative committees with

jurisdiction over agriculture finance and

education finance regarding all grants issued

under this paragraph by November 1, 2025.

Notwithstanding Minnesota Statutes, section

16A.28
, any unencumbered balance does not

cancel at the end of the first year and is

available for the second year, and

appropriations encumbered under contract on

or before June 30, 2025, for agricultural

growth, research, and innovation grants are

available until June 30, 2028.

(d) $27,457,000 the second year is for the

agricultural growth, research, and innovation

program under Minnesota Statutes, section

41A.12
. Except as provided below, the

commissioner may allocate this appropriation

among the following areas: facilitating the

start-up, modernization, improvement, or

expansion of livestock operations, including

beginning and transitioning livestock

operations with preference given to robotic

dairy-milking equipment; assisting

value-added agricultural businesses to begin

or expand, to access new markets, or to

diversify, including aquaponics systems, with

preference given to hemp fiber processing

equipment; facilitating the start-up,

modernization, or expansion of other

beginning and transitioning farms, including

by providing loans under Minnesota Statutes,

section
41B.056
; sustainable agriculture

on-farm research and demonstration; the

development or expansion of food hubs and

other alternative community-based food

distribution systems; enhancing renewable

energy infrastructure and use; crop research,

including basic and applied turf seed research;

Farm Business Management tuition assistance;

and good agricultural practices and good

handling practices certification assistance. The

commissioner may use up to 6.5 percent of

this appropriation for costs incurred to

administer the program.

Of the amount appropriated for the agricultural

growth, research, and innovation program

under Minnesota Statutes, section
41A.12
:

(1) $1,000,000 the second year is for

distribution in equal amounts to each of the

state's county fairs to preserve and promote

Minnesota agriculture;

(2) $5,750,000 the second year is for incentive

payments under Minnesota Statutes, sections

41A.16
,
41A.17
,
41A.18
, and
41A.20
.

Notwithstanding Minnesota Statutes, section

16A.28
, this appropriation is available until

June 30, 2027. If this appropriation exceeds

the total amount for which all producers are

eligible in a fiscal year, the balance of the

appropriation is available for other purposes

under this paragraph. The base under this

clause is $3,000,000 in fiscal year 2026 and

each year thereafter;

(3) $3,375,000 the second year is for grants

that enable retail petroleum dispensers, fuel

storage tanks, and other equipment to dispense

biofuels to the public in accordance with the

biofuel replacement goals established under

Minnesota Statutes, section
239.7911
. A retail

petroleum dispenser selling petroleum for use

in spark ignition engines for vehicle model

years after 2000 is eligible for grant money

under this clause if the retail petroleum

dispenser has no more than ten retail

petroleum dispensing sites and each site is

located in Minnesota. The grant money must

be used to replace or upgrade equipment that

does not have the ability to be certified for

E25. A grant award must not exceed 65

percent of the cost of the appropriate

technology. A grant award must not exceed

$200,000 per station. The commissioner must

cooperate with biofuel stakeholders in the

implementation of the grant program. The

commissioner, in cooperation with any

economic or community development

financial institution and any other entity with

which the commissioner contracts, must

submit a report on the biofuels infrastructure

financial assistance program by January 15 of

each year to the chairs and ranking minority

members of the legislative committees and

divisions with jurisdiction over agriculture

policy and finance. The annual report must

include but not be limited to a summary of the

following metrics: (i) the number and types

of projects financed; (ii) the amount of money

leveraged or matched per project; (iii) the

geographic distribution of financed projects;

(iv) any market expansion associated with

upgraded infrastructure; (v) the demographics

of the areas served; (vi) the costs of the

program; and (vii) the number of grants to

minority-owned or female-owned businesses.

The base under this clause is $3,000,000 for

fiscal year 2026 and each year thereafter;

(4) $1,250,000 the second year is for grants

to facilitate the start-up, modernization, or

expansion of meat, poultry, egg, and milk

processing facilities. A grant award under this

clause must not exceed $200,000. Any

unencumbered balance at the end of the second

year does not cancel until June 30, 2027, and

may be used for other purposes under this

paragraph. The base under this clause is

$250,000 in fiscal year 2026 and each year

thereafter;

(5) $1,275,000 the second year is for providing

more fruits, vegetables, meat, poultry, grain,

and dairy for children in school and early

childhood education settings, including, at the

commissioner's discretion, providing grants

to reimburse schools and early childhood

education and child care providers for

purchasing equipment and agricultural

products. Organizations must participate in

the National School Lunch Program or the

Child and Adult Care Food Program to be

eligible. Of the amount appropriated, $150,000

is for a statewide coordinator of

farm-to-institution strategy and programming.

The coordinator must consult with relevant

stakeholders and provide technical assistance

and training for participating farmers and

eligible grant recipients. The base under this

clause is $1,294,000 in fiscal year 2026 and

each year thereafter;

(6) $4,000,000 the second year is for Dairy

Assistance, Investment, Relief Initiative

(DAIRI) grants and other forms of financial

assistance to Minnesota dairy farms that enroll

in coverage under a federal dairy risk

protection program and produced no more

than 16,000,000 pounds of milk in 2022.
new text begin
New

dairy farms that did not market milk during

2022 or for only a portion of 2022 are eligible.
new text end

The commissioner must make DAIRI

payments based on the amount of milk

produced in 2022, up to 5,000,000 pounds per

participating farm, at a rate determined by the

commissioner within the limits of available

funding.
new text begin
For new dairy farms that did not

market milk during 2022 or for only a portion

of 2022, the commissioner must make DAIRI

payments based on the farm's production

history as established in its dairy risk

protection program enrollment.
new text end
Any

unencumbered balance
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on
deleted text end
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after
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June 30, 2026,

may be used for other purposes under this

paragraph. The allocation in this clause is

onetime;

(7) $2,000,000 the second year is for urban

youth agricultural education or urban

agriculture community development;

(8) $1,000,000 the second year is for the good

food access program under Minnesota

Statutes, section
17.1017
; and

(9) $225,000 the second year is for the

protecting livestock grant program for

producers to support the installation of

measures to prevent the transmission of avian

influenza. For the appropriation in this

paragraph, a grant applicant must document

a cost-share of 20 percent. An applicant's

cost-share amount may be reduced up to

$2,000 to cover time and labor costs.

Notwithstanding Minnesota Statutes, section

16B.98, subdivision 14
, the commissioner may

use up to 6.5 percent of this appropriation for

administrative costs. This appropriation is

available until June 30, 2027. This is a onetime

appropriation.

(e) Notwithstanding Minnesota Statutes,

section
16A.28
, the appropriation in paragraph

(d) does not cancel at the end of the second

year and is available until June 30, 2027.

Appropriations encumbered under contract on

or before June 30, 2027, for agricultural

growth, research, and innovation grants are

available until June 30, 2030.

(f) The base for the agricultural growth,

research, and innovation program is

$17,582,000 in fiscal year 2026 and each year

thereafter and includes $200,000 each year for

cooperative development grants.

new text begin

EFFECTIVE DATE.

new text end

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This section is effective the day following final enactment.

new text end