Lawmakers lament lost agricultural processing capacity
By SEAN ELLIS
BOISE -- Idaho Democrats have proposed an ag jobs bill that would provide producers a 50 percent income tax credit when they add some type of value to an existing crop.
The proposed tax credit would allow Idaho farmers or ranchers to receive the credit for investing in an agricultural processing venture or majority-owned farmer cooperative.
The Value-Added Agriculture and Farmer Empowerment Act would enable anyone investing in value-added capacity for agricultural products to receive 30 percent of their investment as a tax credit, with a cap of $500,000.
Those who qualify would receive the credit in the form of 50 percent of their tax liability each year for up to 14 years.
Sponsors plan to introduce the bill next week.
Idaho has lost much of its agricultural processing capacity over the last 50 years "and we'd like to bring that back," Rep. Brian Cronin, the minority caucus chair, said Jan. 31 during a press conference where the proposal was announced.
"We'd like to encourage and increase value-added processing facilities so that we have more meat processing, creameries, grain processing, etc.," Cronin said.
He said the legislation would "help local family farms and surrounding regions work together to create more full-service processing plants or farm-to-market cooperatives to increase local jobs ... enhance state agricultural exports and keep value-added revenues in Idaho."
Much of the state's agricultural production is shipped out of state, said Rep. Roy Lacey, D-Pocatello, the bill's co-sponsor.
"It costs a lot of money to ship those products out," he said. "What we're looking to do is keep that (commodity) here and make it an Idaho product."
Lacey said the $500,000 amount could be large enough to convince some larger processing plants to open in Idaho "and it works great for the little co-ops or the farmer that just wants to add a little bit to his crop. It would work for everybody."
Rep. Donna Pence, D-Gooding, who is co-sponsoring the bill, said it's patterned after a similar bill in North Dakota. While that bill includes only co-ops, she said, the Idaho bill was expanded to include individual farmers.
"A lot of these producers have ideas. We need to be able to give them an avenue to go forward with them," she said.
Food Producers of Idaho, which represents most of the state's main ag groups, has been presented with the concept and several members have expressed interest in the idea, said FPI Executive Director Rick Waitley. However, he added, the group hasn't decided whether to support it yet and is waiting for an actual bill to be introduced so its impact on or value to the industry can be determined.
Lacey said several major farm groups have supported the idea during face-to-face talks.
"We received great praise for this and they all seemed very excited about it," he said. "We're ready to move. I don't know anybody that could not want to do this."