Tobacco Settlement Agreement Fund Oversight Committee


Minutes of the<MeetNo1> 13th Meeting


<MeetMDY1> January 9, 2008


The<MeetNo2> Tobacco Settlement Agreement Fund Oversight Committee was held on<Day> Wednesday,<MeetMDY2> January 9, 2008, upon adjournment<MeetTime>, in<Room> Room 131 of the Capitol Annex. Representative Mike Denham, Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Carroll Gibson, Co-Chair; Representative Mike Denham, Co-Chair; Senators David E. Boswell and Richie Sanders Jr; Representatives Royce W. Adams, James R. Comer Jr, Charlie Hoffman, and Tom McKee.


Guests:  Mr. Thomas Rogers, Executive Director, Governor's Office of Agricultural Policy; Mr. Tim Hughes and Mr. Joel Neaveill, Governor's Office of Agricultural Policy; Dr. Carl Infanger and Dr. Richard Maurer, University of Kentucky.


LRC Staff:  Lowell Atchley and Lindsey Murphy, Committee Assistant


Co-chair Denham opened the meeting, but deferred approval of the December 2007 minutes because a quorum was not present.


The co-chair called on representatives of the Governor's Office of Agricultural Policy (GOAP) to come before the committee. They included Mr. Roger Thomas, the newly appointed Executive Director of the GOAP, and staff members Tim Hughes and Joel Neaveill.


Co-chair Denham welcomed Mr. Thomas to the meeting, as did Representative Tom McKee, who said Mr. Thomas, a former state representative, had a broad background in Agricultural Development Fund issues. He mentioned working with Mr. Thomas on House Bill 611 when they were in the House of Representatives together in 2000. Co-chair Gibson jokingly urged Mr. Thomas to bring along $25 million when he next came to the meeting.


In his remarks, Mr. Thomas said he was excited about working with Governor Beshear, Agricultural Commissioner Farmer, and the General Assembly. He said he believed all involved could work together to continue to make improvements in agricultural and rural life in Kentucky. Mr. Thomas said he hoped to discuss agricultural issues in the future with Co-chairs Gibson and Denham, and the Tobacco Settlement Agreement Fund Oversight Committte as a whole. He also indicated his willingness to provide any information that committee members needed.


Next, Mr. Neaveill and Mr. Hughes proceeded to review the model and nonmodel projects presented for funding at the December Agricultural Development Board meeting (ADB).


Referring to the Campbell Farm Wool Art Center project to establish a wool arts center, Co-chair Gibson asked about the possibility of funds to assist quilting projects, and further to assist in painting quilt-like patterns on barns. Mr. Hughes said some hay, straw, and commodity storage model program funds possibly could be used to upgrade barns. Co-chair Denham said some funds were available for the barn painting projects through local agricultural extension offices. Mr. Thomas commented quilt projects could be considered for funding in the future.


In reviewing the Kentucky Community and Technical College System Foundation project, Mr. Neaveill noted the original request for $1,365,000 to continue some computer and welding training for farmers was reduced to $210,000, for just the computer segment. Mr. Neaveill told Co-chair Denham, who asked for clarification, that KCTCS would be developing welding programs on a county-by-county level, rather than proceeding with a statewide program.


As the review continued, Co-chair Denham referenced a Montgomery County Cattlemen's Association project offering funding for cattle improvement and handling, and hay, straw, and commodity storage. The chair said such projects had met with great success.


During a discussion of a wireless Internet broadband project that was denied funding, the speakers said a previous program to offer broadband service through counties had attracted little interest from counties.


Representative McKee asked about the status of funding for farmers' market projects. According to Mr. Neaveill, the board had discontinued the competitive farmers' market program, although some remaining funds were still available. According to Mr. Hughes, they began 2007 with almost $626,000 in the regional farmers' market program; almost $984,000 in the community market program, and almost $179,000 in the program to fund marketing or feasibility studies. Mr. Thomas said they would provide additional information on the farmers' market funding in a subsequent meeting.


Next, the chair called on University of Kentucky professors Craig Infanger and Richard Maurer to report on the first phase of their evaluation of the impacts of Agriculture Development Fund non-model expenditures on various sectors of Kentucky agriculture.


According to Dr. Infanger and Dr. Maurer's report, the evaluation dealt with 64 large and medium non-model projects funded during 2001-2006. The value of the projects totaled $82.1 million.


The UK professors' report noted that preliminary survey interviews indicated that "fund recipients have implemented most of the project goals that were proposed, have been supportive of the funding process, and have achieved some impacts as a result of their projects. Most of the impacts reported are consistent with the desired outcomes of the Agricultural Development Board, although documentation of these impacts is often lacking."


During the discussion, the speakers said tentative evaluation results indicated a large majority of funded projects had achieved their goals, although impacts typically were not well documented. They said the degree of impact among projects varied widely. Two successful strategies were noted, support of value-added processing projects, and funding of "package" assistance that included education, marketing, and research and development. Also, 93 percent of projects reported they had increased farm income and 97 percent reported they had helped tobacco-impacted communities.


Responding to committee members' questions, the speakers said that although there were few projects in Eastern Kentucky, that situation would probably change when they began assessing the impact at small projects. They further said one site visit took them to Tennessee because that was where the company had moved after previously having been located in Kentucky.


Addressing additional questions, the speakers said most project recipients answered they had met some of their original objectives, although those goals and objectives had changed as the projects progressed.


Co-chair Denham asked about feedback from project recipients on the GOAP's follow-up procedures related to the projects. Dr. Infanger said they planned to offer some suggestions that GOAP staff spend more time in monitoring and evaluating how recipients had progressed toward achieving their goals. Responding to Representative Adams, they said recipients were informed in advance the site visits would occur.


Co-chair Denham asked if they uncovered any information that was troubling. According to Dr. Infanger, some projects were not performing and those were the ones that received the lowest rating in a five-point rating system. Also, there was some concern about how much information was being reported back to the GOAP as a part of the official reporting process.


Documents distributed during the Committee meeting are available with meeting materials in the LRC Library. The meeting ended at approximately 4:15 p.m.