| 1 | 1 | | 1.1 A bill for an act |
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| 2 | 2 | | 1.2 relating to agriculture; modifying beginning farmer program provisions; modifying |
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| 3 | 3 | | 1.3 grain buyer provisions; allowing the commissioner of agriculture to coordinate |
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| 4 | 4 | | 1.4 with other state agencies and local governments to protect public health against |
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| 5 | 5 | | 1.5 fertilizers and fertilizer by-products; repealing a provision requiring the |
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| 6 | 6 | | 1.6 commissioner of agriculture to report on implementing the biodiesel fuel mandate; |
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| 7 | 7 | | 1.7 amending Minnesota Statutes 2024, sections 18C.111, by adding a subdivision; |
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| 8 | 8 | | 1.8 41B.0391, subdivisions 1, 4; 223.17, subdivision 6; repealing Minnesota Statutes |
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| 9 | 9 | | 1.9 2024, section 239.77, subdivision 5. |
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| 10 | 10 | | 1.10BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: |
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| 11 | 11 | | 1.11 Section 1. Minnesota Statutes 2024, section 18C.111, is amended by adding a subdivision |
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| 12 | 12 | | 1.12to read: |
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| 13 | 13 | | 1.13 Subd. 6.Fertilizers and fertilizer by-products.The commissioner may coordinate the |
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| 14 | 14 | | 1.14protection of public health and the environment from the unreasonable adverse effects of |
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| 15 | 15 | | 1.15fertilizers and fertilizer by-products among state agencies and local governments and may |
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| 16 | 16 | | 1.16assist other state agencies and local governments in providing such protection. |
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| 17 | 17 | | 1.17 Sec. 2. Minnesota Statutes 2024, section 41B.0391, subdivision 1, is amended to read: |
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| 18 | 18 | | 1.18 Subdivision 1.Definitions.(a) For purposes of this section, the following terms have |
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| 19 | 19 | | 1.19the meanings given. |
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| 20 | 20 | | 1.20 (b) "Agricultural assets" means agricultural land, livestock, facilities, buildings, and |
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| 21 | 21 | | 1.21machinery used for farming in Minnesota. |
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| 22 | 22 | | 1.22 (c) "Beginning farmer" means an individual or a single-member limited liability company |
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| 23 | 23 | | 1.23owned by one individual who: |
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| 24 | 24 | | 1Sec. 2. |
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| 25 | 25 | | REVISOR EB/HL 25-0375602/11/25 |
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| 26 | 26 | | State of Minnesota |
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| 27 | 27 | | This Document can be made available |
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| 28 | 28 | | in alternative formats upon request |
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| 29 | 29 | | HOUSE OF REPRESENTATIVES |
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| 30 | 30 | | H. F. No. 2280 |
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| 31 | 31 | | NINETY-FOURTH SESSION |
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| 32 | 32 | | Authored by Hansen, R.,03/13/2025 |
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| 33 | 33 | | The bill was read for the first time and referred to the Committee on Agriculture Finance and Policy 2.1 (1) is a resident of Minnesota; |
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| 34 | 34 | | 2.2 (2) is seeking entry, or has entered within the last ten years, into farming; |
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| 35 | 35 | | 2.3 (3) intends to farm land located within the state borders of Minnesota; |
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| 36 | 36 | | 2.4 (4) except as provided in subdivision 2, paragraph (f), is not and whose spouse is not a |
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| 37 | 37 | | 2.5family member of the owner of the agricultural assets from whom the beginning farmer is |
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| 38 | 38 | | 2.6seeking to purchase or rent agricultural assets; |
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| 39 | 39 | | 2.7 (5) except as provided in subdivision 2, paragraph (f), is not and whose spouse is not a |
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| 40 | 40 | | 2.8family member of a partner, member, shareholder, or trustee of the owner of agricultural |
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| 41 | 41 | | 2.9assets from whom the beginning farmer is seeking to purchase or rent agricultural assets; |
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| 42 | 42 | | 2.10and |
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| 43 | 43 | | 2.11 (6) meets the following eligibility requirements as determined by the authority: |
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| 44 | 44 | | 2.12 (i) has a net worth that does not exceed the limit provided under section 41B.03, |
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| 45 | 45 | | 2.13subdivision 3, paragraph (a), clause (2); |
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| 46 | 46 | | 2.14 (ii) provides the majority of the day-to-day physical labor and management of the farm; |
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| 47 | 47 | | 2.15 (iii) has, by the judgment of the authority, adequate farming experience or demonstrates |
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| 48 | 48 | | 2.16knowledge in the type of farming for which the beginning farmer seeks assistance from the |
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| 49 | 49 | | 2.17authority; |
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| 50 | 50 | | 2.18 (iv) demonstrates to the authority a profit potential by submitting projected earnings |
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| 51 | 51 | | 2.19statements; |
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| 52 | 52 | | 2.20 (v) asserts to the satisfaction of the authority that farming will be a significant source |
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| 53 | 53 | | 2.21of income for the beginning farmer; |
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| 54 | 54 | | 2.22 (vi) is enrolled in or has completed within ten years of their first year of farming a |
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| 55 | 55 | | 2.23financial management program approved by the authority or the commissioner of agriculture; |
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| 56 | 56 | | 2.24 (vii) agrees to notify the authority if the beginning farmer no longer meets the eligibility |
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| 57 | 57 | | 2.25requirements within the three-year certification period, in which case the beginning farmer |
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| 58 | 58 | | 2.26is no longer eligible for credits under this section; and |
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| 59 | 59 | | 2.27 (viii) has other qualifications as specified by the authority. |
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| 60 | 60 | | 2.28The authority may waive the requirement in item (vi) if the participant requests a waiver |
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| 61 | 61 | | 2.29and has a four-year degree in an agricultural program or related field, reasonable agricultural |
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| 62 | 62 | | 2.30job-related experience, or certification as an adult farm management instructor. |
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| 63 | 63 | | 2Sec. 2. |
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| 64 | 64 | | REVISOR EB/HL 25-0375602/11/25 3.1 (d) "Emerging farmer" means an emerging farmer within the meaning of section 17.055, |
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| 65 | 65 | | 3.2subdivision 1. |
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| 66 | 66 | | 3.3 (e) "Family member" means a family member within the meaning of the Internal Revenue |
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| 67 | 67 | | 3.4Code, section 267(c)(4). |
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| 68 | 68 | | 3.5 (f) "Farm product" means plants and animals useful to humans and includes, but is not |
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| 69 | 69 | | 3.6limited to, forage and sod crops, oilseeds, grain and feed crops, dairy and dairy products, |
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| 70 | 70 | | 3.7poultry and poultry products, livestock, fruits, and vegetables. |
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| 71 | 71 | | 3.8 (g) "Farming" means the active use, management, and operation of real and personal |
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| 72 | 72 | | 3.9property for the production of a farm product. |
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| 73 | 73 | | 3.10 (h) "Owner of agricultural assets" means an individual, trust, or pass-through entity that |
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| 74 | 74 | | 3.11is the owner in fee of agricultural land or has legal title to any other agricultural asset. Owner |
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| 75 | 75 | | 3.12of agricultural assets does not mean an equipment dealer, livestock dealer defined in section |
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| 76 | 76 | | 3.1317A.03, subdivision 7, or comparable entity that is engaged in the business of selling |
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| 77 | 77 | | 3.14agricultural assets for profit and that is not engaged in farming as its primary business |
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| 78 | 78 | | 3.15activity. An owner of agricultural assets approved and certified by the authority under |
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| 79 | 79 | | 3.16subdivision 4 must notify the authority if the owner no longer meets the definition in this |
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| 80 | 80 | | 3.17paragraph within the three year certification period and is then no longer eligible for credits |
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| 81 | 81 | | 3.18under this section. |
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| 82 | 82 | | 3.19 (i) "Resident" has the meaning given in section 290.01, subdivision 7. |
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| 83 | 83 | | 3.20 (j) "Share rent agreement" means a rental agreement in which the principal consideration |
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| 84 | 84 | | 3.21given to the owner of agricultural assets is a predetermined portion of the production of |
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| 85 | 85 | | 3.22farm products produced from the rented agricultural assets and which provides for sharing |
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| 86 | 86 | | 3.23production costs or risk of loss, or both. |
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| 87 | 87 | | 3.24 Sec. 3. Minnesota Statutes 2024, section 41B.0391, subdivision 4, is amended to read: |
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| 88 | 88 | | 3.25 Subd. 4.Authority duties.(a) The authority shall: |
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| 89 | 89 | | 3.26 (1) approve and certify or recertify beginning farmers as eligible for the program under |
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| 90 | 90 | | 3.27this section; |
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| 91 | 91 | | 3.28 (2) approve and certify or recertify owners of agricultural assets as eligible for the tax |
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| 92 | 92 | | 3.29credit under subdivision 2 subject to the allocation limits in paragraph (c); |
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| 93 | 93 | | 3.30 (3) provide necessary and reasonable assistance and support to beginning farmers for |
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| 94 | 94 | | 3.31qualification and participation in financial management programs approved by the authority; |
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| 95 | 95 | | 3Sec. 3. |
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| 96 | 96 | | REVISOR EB/HL 25-0375602/11/25 4.1 (4) refer beginning farmers to agencies and organizations that may provide additional |
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| 97 | 97 | | 4.2pertinent information and assistance; and |
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| 98 | 98 | | 4.3 (5) notwithstanding section 41B.211, the Rural Finance Authority must share information |
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| 99 | 99 | | 4.4with the commissioner of revenue to the extent necessary to administer provisions under |
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| 100 | 100 | | 4.5this subdivision and section 290.06, subdivisions 37 and 38. The Rural Finance Authority |
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| 101 | 101 | | 4.6must annually notify the commissioner of revenue of approval and certification or |
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| 102 | 102 | | 4.7recertification of beginning farmers and owners of agricultural assets under this section. |
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| 103 | 103 | | 4.8For credits under subdivision 2, the notification must include the amount of credit approved |
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| 104 | 104 | | 4.9by the authority and stated on the credit certificate. |
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| 105 | 105 | | 4.10 (b) The certification of a beginning farmer or an owner of agricultural assets under this |
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| 106 | 106 | | 4.11section is valid for the year of the certification and the two following years, after which |
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| 107 | 107 | | 4.12time the beginning farmer or owner of agricultural assets must apply to the authority for |
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| 108 | 108 | | 4.13recertification. |
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| 109 | 109 | | 4.14 (c) For credits for owners of agricultural assets allowed under subdivision 2, the authority |
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| 110 | 110 | | 4.15must not allocate more than $6,500,000 for taxable years beginning after December 31, |
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| 111 | 111 | | 4.162022, and before January 1, 2024, and $4,000,000 for taxable years beginning after December |
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| 112 | 112 | | 4.1731, 2023. The authority must allocate credits on a first-come, first-served basis beginning |
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| 113 | 113 | | 4.18on January 1 of each year, except that recertifications for the second and third years of |
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| 114 | 114 | | 4.19credits under subdivision 2, paragraph (a), clauses (1) and (2), have first priority. Any |
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| 115 | 115 | | 4.20amount authorized but not allocated for taxable years ending before January 1, 2023, is |
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| 116 | 116 | | 4.21canceled and is not allocated for future taxable years. For taxable years beginning after |
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| 117 | 117 | | 4.22December 31, 2022, any amount authorized but not allocated in any taxable year does not |
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| 118 | 118 | | 4.23cancel and is added to the allocation for the next taxable year. For each taxable year, 50 |
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| 119 | 119 | | 4.24percent of newly allocated credits must be allocated to emerging farmers. Any portion of a |
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| 120 | 120 | | 4.25taxable year's newly allocated credits that is reserved for emerging farmers that is not |
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| 121 | 121 | | 4.26allocated by September 30 June 1 of the taxable year is available for allocation to other |
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| 122 | 122 | | 4.27credit allocations beginning on October 1 June 2. |
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| 123 | 123 | | 4.28 Sec. 4. Minnesota Statutes 2024, section 223.17, subdivision 6, is amended to read: |
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| 124 | 124 | | 4.29 Subd. 6.Financial statements.(a) Except as allowed in paragraph (c), a grain buyer |
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| 125 | 125 | | 4.30licensed under this chapter must annually submit to the commissioner a financial statement |
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| 126 | 126 | | 4.31prepared by an independent third-party accountant or a certified public accountant, in |
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| 127 | 127 | | 4.32accordance with generally accepted accounting principles national or international accounting |
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| 128 | 128 | | 4.33standards. The annual financial statement required under this subdivision must also: |
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| 129 | 129 | | 4.34 (1) include, but not be limited to the following: |
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| 130 | 130 | | 4Sec. 4. |
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| 131 | 131 | | REVISOR EB/HL 25-0375602/11/25 5.1 (i) a balance sheet; |
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| 132 | 132 | | 5.2 (ii) a statement of income (profit and loss); |
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| 133 | 133 | | 5.3 (iii) a statement of retained earnings; |
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| 134 | 134 | | 5.4 (iv) a statement of changes in financial position cash flow; and |
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| 135 | 135 | | 5.5 (v) a statement of the dollar amount of grain purchased in the previous fiscal year of the |
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| 136 | 136 | | 5.6grain buyer; |
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| 137 | 137 | | 5.7 (2) be accompanied by a compilation report of the financial statement that is prepared |
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| 138 | 138 | | 5.8by a grain commission firm or a management firm approved by the commissioner or by an |
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| 139 | 139 | | 5.9independent third-party accountant or a certified public accountant, in accordance with |
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| 140 | 140 | | 5.10national or international accounting standards established by the American Institute of |
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| 141 | 141 | | 5.11Certified Public Accountants; |
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| 142 | 142 | | 5.12 (3) be accompanied by a certification by the chief executive officer or the chief executive |
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| 143 | 143 | | 5.13officer's designee of the licensee, and where applicable, all members of the governing board |
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| 144 | 144 | | 5.14of directors under penalty of perjury, that the financial statement accurately reflects the |
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| 145 | 145 | | 5.15financial condition of the licensee for the period specified in the statement; |
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| 146 | 146 | | 5.16 (4) for grain buyers purchasing under $7,500,000 of grain annually, be reviewed by a |
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| 147 | 147 | | 5.17certified public accountant in accordance with standards established by the American Institute |
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| 148 | 148 | | 5.18of Certified Public Accountants, and must show that the financial statements are free from |
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| 149 | 149 | | 5.19material misstatements; and |
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| 150 | 150 | | 5.20 (5) (3) for grain buyers purchasing $7,500,000 or more of grain annually, be audited or |
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| 151 | 151 | | 5.21reviewed by a certified public accountant in accordance with standards established by the |
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| 152 | 152 | | 5.22American Institute of Certified Public Accountants and or similar international standard. |
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| 153 | 153 | | 5.23Audits under this paragraph must include an opinion statement from the certified public |
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| 154 | 154 | | 5.24accountant.; and |
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| 155 | 155 | | 5.25 (4) for grain buyers purchasing above $20,000,000 or more of grain annually, be audited |
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| 156 | 156 | | 5.26by a certified public accountant in accordance with the standards established by the American |
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| 157 | 157 | | 5.27Institute of Certified Public Accountants or similar international standard and must include |
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| 158 | 158 | | 5.28an opinion statement from the certified public accountant. |
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| 159 | 159 | | 5.29 (b) Only one financial statement must be filed for a chain of warehouses owned or |
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| 160 | 160 | | 5.30operated as a single business entity, unless otherwise required by the commissioner. All |
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| 161 | 161 | | 5.31financial statements filed with the commissioner are private or nonpublic data as provided |
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| 162 | 162 | | 5.32in section 13.02. |
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| 163 | 163 | | 5Sec. 4. |
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| 164 | 164 | | REVISOR EB/HL 25-0375602/11/25 6.1 (c) A grain buyer who purchases grain immediately upon delivery solely with cash; a |
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| 165 | 165 | | 6.2certified check; a cashier's check; or a postal, bank, or express money order, as defined in |
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| 166 | 166 | | 6.3section 223.16, subdivision 2a, paragraph (b), is exempt from this subdivision if the grain |
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| 167 | 167 | | 6.4buyer's gross annual purchases are $1,000,000 or less. |
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| 168 | 168 | | 6.5 (d) For grain buyers who qualify for the exemption under paragraph (c), the commissioner |
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| 169 | 169 | | 6.6retains the right to require financial reporting based on inspections, reports of nonpayment |
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| 170 | 170 | | 6.7or other violations defined in this chapter, chapter 232, or Minnesota Rules, chapter 1562. |
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| 171 | 171 | | 6.8 (d) (e) The commissioner shall annually provide information on a person's fiduciary |
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| 172 | 172 | | 6.9duties to each licensee. To the extent practicable, the commissioner must direct each licensee |
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| 173 | 173 | | 6.10to provide this information to all persons required to certify the licensee's financial statement |
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| 174 | 174 | | 6.11under paragraph (a), clause (3). |
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| 175 | 175 | | 6.12 (f) For the purpose of compliance with this chapter, the commissioner must annually |
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| 176 | 176 | | 6.13review financial statements for each grain buyer licensed under this chapter. |
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| 177 | 177 | | 6.14 Sec. 5. REPEALER. |
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| 178 | 178 | | 6.15 Minnesota Statutes 2024, section 239.77, subdivision 5, is repealed. |
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| 179 | 179 | | 6Sec. 5. |
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| 180 | 180 | | REVISOR EB/HL 25-0375602/11/25 239.77 BIODIESEL CONTENT MANDATE. |
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| 181 | 181 | | Subd. 5.Annual report.(a) Beginning in 2009, the commissioner of agriculture must report |
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| 182 | 182 | | by January 15 of each year to the chairs and ranking minority members of the legislative committees |
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| 183 | 183 | | and divisions with jurisdiction over agriculture policy and finance regarding the implementation |
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| 184 | 184 | | of the minimum content requirements in subdivision 2, including information about the price and |
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| 185 | 185 | | supply of biodiesel fuel. The report shall include information about the impacts of the biodiesel |
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| 186 | 186 | | mandate on the development of biodiesel production capacity in the state, and on the use of feedstock |
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| 187 | 187 | | grown or raised in the state for biodiesel production. The report must include any written comments |
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| 188 | 188 | | received from members of the biodiesel fuel task force by January 1 of that year designated by them |
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| 189 | 189 | | for inclusion in the report. |
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| 190 | 190 | | (b) The commissioner of agriculture, in consultation with the commissioner of commerce and |
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| 191 | 191 | | the Biodiesel Fuel Task Force, shall study the need to continue the exceptions in subdivision 3. The |
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| 192 | 192 | | 2013 report under paragraph (a) shall include recommendations for studies and other research needs |
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| 193 | 193 | | to make a determination on the need for the exceptions, including any recommendations for use of |
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| 194 | 194 | | the agricultural growth, research, and innovation program funding to conduct the research. The |
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| 195 | 195 | | 2014 report under paragraph (a) shall contain the commissioner of agriculture's recommendations |
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| 196 | 196 | | on whether to continue any of the exceptions in subdivision 3. |
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| 197 | 197 | | 1R |
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| 198 | 198 | | APPENDIX |
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| 199 | 199 | | Repealed Minnesota Statutes: 25-03756 |
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