Tobacco Settlement Agreement Fund Oversight Committee


Minutes of the<MeetNo1> 6th Meeting

of the 2004 Interim


<MeetMDY1> September 14, 2004


The<MeetNo2> 6th meeting of the Tobacco Settlement Agreement Fund Oversight Committee was held on<Day> Tuesday,<MeetMDY2> September 14, 2004, at<MeetTime> 1:00 PM, in<Room> Room 131 of the Capitol Annex. Senator Vernie McGaha, Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Vernie McGaha, Co-Chair; Representative Roger Thomas, Co-Chair; Senator Charlie Borders; Representatives Adrian Arnold, Carolyn Belcher, James Comer, Thomas McKee, and Tommy Turner.


Guests:† Karen Jones, Kentucky Agency for Substance Abuse Policy; Bobbie Walters, Cabinet for Health and Family Services; Brent Frazier, Kentucky Department of Agriculture; Maner Ferguson and Billy Van Pelt, Lexingon/Fayette Urban County Government; Keith Rogers, Brian Furnish, and Stephen Yates, Governor's Office of Agriculture Policy.


LRC Staff:† Lowell Atchley, Tanya Monsanto, Biff Baker, and Kelly Blevins.


Mr. Keith Rogers and Mr. Brian Furnish, director and deputy director respectively of the Governorís Office of Agricultural Policy (GOAP) presented a list of applications that the Agricultural Development Board (ADB) considered during its August meeting. Information about the projects is on file with the meeting materials in the LRC Library.


Mr. Rogers reviewed two Owen County projects, one involving a commitment of $79,950 to equip an agri-science lab for agriculture students, and another, a commitment of $117,728 to undertake a cost-share program directed at mentoring young people ages 9-19. Responding to a question from Chairman Thomas, Mr. Furnish said mentors must be parents or adults over 21 who must also take part in the youth activities. Mr. Furnish said Owen County is a high tobacco-dependent county and the county has emphasized education as one of its priorities in using tobacco settlement money.


Next, Mr. Rogers summarized a $12,643 Meade County project in which the Meade County Grain Growers would continue a crop consultation service for grain growers. In answering a series of questions from Representative McKee, Mr. Rogers said this marks the third year that Meade County has approved similar funding. The hope is to get additional people accessing the service and eventually seeing the project evolve into a long-term effort.


Other projects included a $3,000 commitment from Grayson and Edmonson counties to fund some prawn harvest equipment for the Southern Kentucky Aquaculture Cooperative. A $600 commitment in Fleming County with funds going to the Buffalo Trace Area Development District to develop a farmersí market in Fleming County.


Later, Representative McKee asked about the status of the Northern Kentucky Farmersí Market. Mr. Rogers said the Agricultural Development Board probably would discuss farmersí markets during their retreat in October. The ADB also was expected to receive a report regarding farmersí markets from Agricultural Commissioner Richie Farmer at its September 17 regular meeting. Mr. Rogers said the report would contain recommendations on farmersí markets, particularly suggestions regarding on-going funding.


During the discussion of model programs, Representative Belcher asked what is covered under the on-farm water enhancement county model program. The GOAP officials responded that investment areas can include funding for activities like digging or cleaning out ponds, or laying water lines to fields. They said that model program is not a popular one.


Representative McKee then asked how many counties had taken advantage of the hay, straw, and commodity storage model program. The officials did not know off-hand, but promised to provide the answer later.


Chairman Thomas asked how much money had been committed under the goat diversification county model program. In responding, the GOAP administrators said they would provide data regarding county and state funds committed, and in particular, which counties have allotted funding. According to Mr. Furnish, goat meat producers have been successful in marketing their products, particularly in certain regions of the U.S. where the demand is high. He said Kentucky is currently lacking adequate infrastructure, namely slaughter facilities.


Chairman McGaha next introduced Mr. Brent Frazier who gave a report on the Purchase of Agricultural Conservation Easement (PACE) program. Mr. Frazier, program coordinator for the Department of Agricultureís Division of Agricultural Education and Farmland Preservation, reported that the PACE Corporation has purchased agricultural conservation easements on 78 farms totaling $15,522,027. The easement costs have averaged $885 per acre. The average farm size is 224 acres. In addition, 19 easements on 3,069 acres have been donated to the program, bringing the total inventory to 97 farms containing 20,600 acres.


Since the inception of the program, the Department of Agriculture has received 699 applications from 73 counties statewide totaling over 130,000 acres. A total of 577 applications are pending currently for a total of over 113,000 acres with an estimated easement value of about $100 million.


The PACE program has received over $18 million in funding since FY 97-98, including proceeds from a $10 million bond issue through GOAP, $2,400,000 from the general fund, and $5,175,987 in federal matching funds.


Representatives of the Lexington-Fayette County Purchase of Development Rights (PDR) program appeared next. Mr. Maner Ferguson and Mr. Billy Van Pelt, program manager and program administrative officer, reported that since January 2000, the PDR program has protected 83 farms and 10,702 acres of farmland in Lexington-Fayette County. Thus far, PDR has spent $26,345,255 overall in local, state, and federal funds purchasing conservation easements. Currently, 63 applicants are requesting funding in an upcoming round of purchases. They pointed out that the PDR program has formed a critical mass necessary to preserve the general agriculture, equine and tourism industries in Fayette County and the Bluegrass Region.


Mr. Ferguson indicated that $2,707,732 remains from the $15 million bond issue through GOAP. The program also has received $4,041,771 in federal matching grant funds. PACE and PDR materials distributed at the meeting are on file in the LRC Library.


The meeting ended at approximately 2:35 p.m.