Farmers and other farm-based businesses who want to avoid paying bills for crop residue, fertilizer, water, pesticides and other costs have been paying the cost with their own money.
The Senate Agricultural Committee has approved a bill that would require farmers to pay a fee to state agricultural departments, as well as a payment to farmers for their own use of the funds.
The bill is a response to a proposal to charge farmers a 1 percent fee on all grain and other products sold in state stores.
It was originally introduced in May, but stalled in the committee before the full Senate took up it last week.
The fee will cost $10 per acre-foot of grain, which is about $8.80 per acre per hectare, according to the Senate Agriculture Committee.
The bill also allows farmers to deduct the amount from their crop residue and fertilizer expenses, and to deduct any payment they make for their equipment.
Sen. Dan Wiedefeld, D-Rochester, and Sen. David McNeilly, R-Hagerstown, introduced a bill earlier this year to establish a “state farm service fee,” but it died in the Senate Commerce and Labor committee, and the Agriculture Committee didn’t take up it.
Wiedepholdt said he plans to move the fee to the full committee next week.
“It’s going to be a good thing for farmers,” Wiedehleldt said.
The farm bill also includes a provision requiring states to pay the farmers a 10 percent sales tax for the first $100,000 in crop residue or fertilizer sales.
It would also allow state agencies to issue a certificate of deposit to farmers who don’t pay their bills, but would not require payment in full.
Wiedefellt said that for small farmers, the money will help cover the cost of equipment they need to operate.
For a larger farmer, the revenue could help cover any other costs, including insurance, crop insurance and other expenses, Wiedefleld said.
But he said the fee won’t go as far as some other agricultural fees.
“You’re not going to see a 10-percent surcharge on food and gas, but it will be a very large amount of money,” he said.