TESTIMONY LB 1174
February 12, 2008
The past summer and fall this Committee held a series of hearings and meetings to begin the process of identifying issues and looking at options for business models in Nebraska agriculture; we commend you on your effort in working to address this difficult issue. Our position during this process has been consistent in that we can not support any legislation that would place business entity limitations on producers working with other producers. Our second concern is to avoid creating any legislation that would put the state into violation of existing federal law which would result in further court action.
The Nebraska Corn Growers Association is opposed to LB 1174 as presented here today. Our organization’s policy position is to support allowing unrelated farmers to have access to business structures which would be deemed illegal under this proposal.
Agriculture is a capital intense industry which creates special challenges for young producers who need to partner with others to get started in farming. Restricting the business models which farmers can utilize to work together creates problems by limiting opportunities for sharing and accessing needed resources. A viable future in agriculture will require opportunities to work together as the pool of labor continues to get smaller. Further advancements in technology and economies of scale will continue to be a driving force in agriculture. Low cost of production is still the key to farm profitability and sustainability. Agriculture should not be singled out and limited to business entities that may not fit future needs.
Producers need the flexibility to work with non-family partners to build their operations and work for common goals. Each farming operation has its own challenges and must have access to business structures that fit their farm. Our organization believes that producers should not face any more operating limitations than any other business in their community.
Several bills have been introduced to broaden and strengthen the Beginning Farmer Tax Credit Act this session. Senator Fulton’s bill LB 875 seeks to expand Beginning Farmer Tax Credit opportunities by expanding ownership options to include investors and various types of business entity ownership. Last year this Legislature passed New Generation Coop legislation that provides a new business opportunity for business and agriculture. These efforts are focused on providing more options for Nebraska’s farmers and ranchers, options that could have real value if implemented by groups of producers. LB 1174 negates the options provided by LB 875 as well as the New Generation Coop legislation by imposing limitations and removing possible opportunity.
The Nebraska Corn Growers Association can not support a bill that restricts non-related family farmers options when they seek to work together for their common goals. We ask the Committee to not advance LB 1174 out of committee.
