cofa

Commission on the Future of Agriculture

     In the fall of 1997, North Dakota’s Commissioner of Agriculture Roger Johnson announced plans to form a Commission on the Future of Agriculture (COFA) in North Dakota. He wanted the commission to address two main issues:

Assess North Dakota agriculture’s current situation and determine a vision for the future of the industry.

Develop recommendations that would enable North Dakota’s agriculture industry to achieve that vision.

     The commission was formed partly in response to the harsh times that agriculture, the state’s main industry, had undergone in recent years. In particular, 1997 had been a rough year for the state’s wheat and beef cattle producers. According to the U.S. Department of Agriculture’s Economic Research Service, North Dakota’s net farm income in 1997 decreased by 90 percent from the prior year (Economic Research Service). During 1997, it was estimated that winter storms, spring flooding, early summer drought, and crop disease problems had led North Dakota farmers to endure losses of over one-half billion dollars; indirect losses were estimated to be nearly $2 billion (North Dakota Department of Agriculture).
     COFA’s steering committee was headed by Johnson and included four other members from the North Dakota Farm Bureau and North Dakota Farmers Union (the state’s two largest farm organizations), the North Dakota Association of Rural Electric Cooperatives (NDAREC), and North Dakota State University (NDSU). The NDAREC was represented by its executive director, Dennis Hill. Mr. Hill had also served as co-chairperson for the program that led to the state’s Growing North Dakota economic development initiative in 1991. The steering committee established a 14 member working group, which included Bill Patrie and Jack Dalrymple, two men who had significant experience with new generation cooperatives. The commission itself was comprised of 61 members from various organizations, including commodity groups, farm organizations, private entities, the legislature, and state and federal agencies. Funding for the COFA was provided by the state’s attorney general, who gave the commission funds received from a $100,000 settlement of a lawsuit by the state against a chemical company. The steering committee hired Don Senechal of the consulting firm Senechal, Jorgenson, & Hale, to prepare an agenda and establish priorities for the commission. Senechal’s firm had been involved with the start-up of many new generation cooperatives in the state. His fee for the COFA project was $70,000 (Davis).
     COFA held its first public forum in January 1998 at the state’s annual Marketplace event. Twenty other public meetings were later held throughout the state. More than 1,000 people attended these public forums, and others participated in writing. The public input process was similar to the approach taken years earlier in the Vision 2000/Growing North Dakota initiative, but now the process was focused on the state’s agriculture industry in particular, not just overall economic development. The working group went on to develop a draft report that was then modified and approved in June 1998 by the full commission. The commission’s work resulted in 54 recommendations.
     COFA’s 15-page report, entitled Building the Future of North Dakota Agriculture, included the following vision and mission statements, and five main goals:
Vision:
“That North Dakota becomes the trusted provider of the highest-quality food in the world with:

Prosperous family farms;

Thriving rural communities; and

World-class stewardship of resources.”

Mission:
“To significantly increase net farm income, improve the quality of rural life, and increase North Dakota’s rural population.”
Goals:

“Make North Dakota agricultural products synonymous with high quality, dominating the premium markets.

Increase value-added agricultural processing.

Diversify and increase the value of agricultural production.

Increase farm and non-farm cooperation that supports thriving rural communities and enhances our natural resources.

Create a political, regulatory, economic, trade, financial, and natural resource environment in which North Dakota producers can compete in the global marketplace.”

     For each of the five goals, the report listed several objectives and recommended actions to take.
Value-added Agricultural Processing Objectives & Recommendations
     Goal #2 above, which was specifically focused on value-added agricultural processing, was backed by five objectives and ten specific recommendations for action. The objectives called for:

increasing incentives to promote producer investment in value-added agricultural processing;

strengthening the North Dakota Agricultural Processing Utilization Commission (APUC);

providing favorable finance programs for value-added agricultural processing businesses;

promoting innovative financial tools to allow non-producer investment in value-added agricultural processing; and

locating value-added businesses in rural areas if feasible, and preferably in North Dakota.

Specific recommendations included:

asking Congress and the state legislature to provide tax incentives for producer investments in value-added processing projects;

providing the Agricultural Products Utilization Commission (APUC) with a permanent source of funding and keeping the program primarily controlled by farmers;

improving cooperative stock purchase programs so that greater incentives would be in place for low-equity farmers and improved loan terms would be available to farmers;

developing a capital fund that would be partially funded by Bank of North Dakota earnings and that would invest in value-added processing projects;

developing a mutual fund capital pool to attract non-farm investments in North Dakota value-added processing projects; and

asking the state legislature to appropriate funds for the Partnership in Assisting Community Expansion (PACE) program that would allow for lower matching fund requirements from value-added processing projects.

     The NDAREC printed copies of the report and included it in the September 1998 edition of the monthly magazine of the state’s rural electric and telephone cooperatives, “North Dakota REC/RTC Magazine”. The magazine has a circulation base of approximately 85,000.
Legislative Action
     Initially, the bipartisan Commission introduced two major bills that encompassed its goals and recommendations. However, the initiatives ran into political problems when the Republican party criticized the proposals; Commissioner of Agriculture Roger Johnson is a Democrat whereas the Republicans controlled both the Senate and the House Agricultural Committee chairmanships. Components of the two major bills were consequently split into many smaller bills. Many of the bills that were related to the COFA’s goals and recommendations were voted down, mainly along party lines.
     In September 1999, Jim Moench, COFA’s coordinator, indicated that COFA was regrouping so that it would be able to go into the next legislative session with a more bipartisan approach. He also indicated that COFA’s initial timeline of 2 years was too optimistic, and that instead the commission was looking at the possibility of a 5 year plan.
     Regardless of the final results that may arise, the work and planning that COFA has involved represents another example of the efforts that North Dakotans have made to further value-added processing ventures in the state.
References
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