Fiscal Note & Local Impact Statement
127 th General Assembly of Ohio
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BILL: |
DATE: |
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STATUS: |
SPONSOR: |
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LOCAL IMPACT
STATEMENT REQUIRED: |
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STATE FUND |
FY 2008 |
FY 2009 |
FUTURE YEARS |
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General Revenue Fund –
Department of Agriculture |
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Revenues |
- 0 - |
- 0 - |
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Expenditures |
Minimal increase |
- 0 - |
- 0 - |
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Note: The state
fiscal year is July 1 through June 30.
For example, FY 2008 is July 1, 2007 – June 30, 2008.
·
The
bill establishes a grain marketing program.
Initially, the Department of Agriculture may incur minimal expenses in
starting up the program, such as for publishing a ballot request form in at
least two periodicals.
·
The
program is funded through a one-half percent assessment on the gross price of
wheat, barley, rye, and oats at the first point of sale. Assessment revenue is to be used to cover
the costs of administering the marketing program. Current law provides two alternatives to how this revenue may be
handled. The grain commodity marketing
group could deposit the assessment revenue with a bank or savings and loan
association and provide various financial statements to the Department. The other option would be to use the
Department's Agricultural Commodity Marketing Program Fund (Fund 494), which
serves as a pass-through fund for commodity marketing groups.
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LOCAL
GOVERNMENT |
FY 2007 |
FY 2008 |
FUTURE YEARS |
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Counties and
Municipalities |
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Revenues |
Potential negligible gain
from court cost, filing fee, or fine revenue |
Potential negligible gain
from court cost, filing fee, or fine revenue |
Potential negligible gain
from court cost, filing fee, or fine revenue |
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Expenditures |
Potential negligible
increase in adjudication costs |
Potential negligible
increase in adjudication costs |
Potential negligible
increase in adjudication costs |
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Note: For most local governments, the fiscal year is the calendar year. The school district fiscal year is July 1 through June 30.
·
The
bill creates a fourth degree misdemeanor penalty for persons that knowingly
fail to refuse to withhold or remit an assessment on grain. The new penalty may result in a negligible
increase in local criminal justice costs.
Any new costs would likely be offset through court cost and fine
revenue.
·
The
bill also allows the Director of Agriculture to institute an action that
appears necessary to enforce compliance with applicable laws and rules. It is likely that any increases in local
civil justice costs would also be negligible.
Any new such costs would likely be offset through court cost and filing
fee revenue.
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There are currently six
state-regulated agricultural marketing programs operating in the state. These programs are for the following
industries: corn, beef, sheep and wool,
apples, eggs, vegetables, and small fruit.
This bill establishes a commodity marketing program for grains such as
wheat, barley, rye, and oats. The
purpose of the program is to help grain producers promote the sale of grain,
maintain and expand present markets, create new and larger domestic and foreign
markets, and inform the public of the uses and benefits of grain. The program is funded through one-half
percent assessment on the gross price of wheat, barley, rye, and oats at the
first point of sale. According to the
U.S. Department of Agriculture's 2002 Census of Agriculture, there are
approximately 14,340 Ohio farms growing wheat, 3,865 Ohio farms growing oats,
489 Ohio farms growing barley, and 270 Ohio farms growing rye.
State fiscal effects – Department of
Agriculture
Grain marketing program –
costs
Under
the bill, the Director of Agriculture is responsible for holding an election to
determine the membership of the nine-member grain marketing program operating
committee. The Director has various
duties in this regard including accepting nominations, placing names on the
ballot, designating polling places, sending ballots to eligible producers upon
request, publishing a ballot request form in at least two periodicals
designated by the Director, and providing a toll-free telephone number that
producers may call to request a ballot.
The Director of Agriculture is also tasked with monitoring the
activities of the program to ensure that the program is self-supporting, the
appropriate records are kept, and the program is in compliance with applicable
laws and rules.
There
would likely be only a minimal increase in expenses for the Department of
Agriculture to carry out these responsibilities as it currently performs the
above duties as needed for the existing commodity marketing groups. Specifically, costs to publish ballot
request forms would likely be minimal, as the Department has recently published
similar forms inexpensively. The
Department would utilize an existing toll-free number for producers of current
marketed commodities for grain producers requesting a ballot. According to the Department, sponsoring organizations,
such as the Ohio Wheat Growers Association, would pay for other related costs,
such as printing ballots and mailings.
Members of the operating
committee are entitled to actual and necessary travel and incidental expenses
while attending meetings and performing official responsibilities delegated to
the committee. These reimbursements are
paid out of the assessment paid by producers.
Based on the experience of other commodity marketing groups, these
reimbursements should pose only a minimal cost to the grain marketing
committee. In fact, some current
commodity marketing groups forego such reimbursements.
Grain
marketing program revenue
The grain marketing program
is funded through a one-half percent assessment on the gross price of wheat,
barley, rye, and oats at the first point of sale. Assessment revenue is to be used to cover the costs of
administering the marketing program.
Current law provides two alternatives to how this revenue may be
handled. The grain commodity marketing
group could deposit the revenue with a bank or savings and loan association and
provide monthly and annual financial statements. The other option would be to use the Agricultural Commodity
Marketing Program Fund (Fund 494), which serves as a pass-through fund for
commodity marketing groups. Groups
using Fund 494 then request repayment
from the Department to be used to pay authorized expenses, such as those for
promotions, marketing, and research. Three of the six current
marketing programs use this pass-through method.
Local fiscal effects
The
bill creates a fourth degree misdemeanor penalty for persons that knowingly
fail to refuse to withhold or remit an assessment on grain. However, before instituting enforcement
action for such a violation, the bill allows the Director of Agriculture to
give the alleged violator an opportunity to present that person's views to the
Director as to why the action should not be instituted. The new penalty may result in a negligible
increase in local criminal justice costs related to investigating, prosecuting,
adjudicating, and sanctioning offenders.
Any new costs would likely be offset through court cost and fine
revenue.
The
bill also allows the Director of Agriculture to institute an action that
appears necessary to enforce compliance with applicable laws and rules. It is likely that any increases in local
civil justice costs would also be negligible.
Any new such costs would likely be offset through court cost and filing
fee revenue.
LSC fiscal staff: Jason Phillips, Budget Analyst