Tobacco Settlement Agreement Fund Oversight Committee




<MeetMDY1> March 5, 2012


Call to Order and Roll Call

The<MeetNo2> meeting of the Tobacco Settlement Agreement Fund Oversight Committee was held on<Day> Monday,<MeetMDY2> March 5, 2012, at<MeetTime> 2:00 PM, in<Room> Room 129 of the Capitol Annex. Representative Wilson Stone, Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Paul Hornback, Co-Chair; Representative Wilson Stone, Co-Chair; Senators David Givens and Vernie McGaha; Representatives Tom McKee and Ryan Quarles.


Guests: Roger Thomas, Joel Neaveill, Bill McCloskey, Angela Blank, Jennifer Hudnall, Christi Marksbury, and Michael Tobin, Governor’s Office of Agricultural Policy.


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


At the outset of the meeting, the committee co-chair, Representative Wilson Stone, introduced the newest committee member, Representative Ryan Quarles, who replaced former State Representative and current Agriculture Commissioner James R. Comer.

            Co-chair Stone introduced visiting governmental officials, journalists, and students from the country of Zambia in southern Africa. A host for the group, Mr. Al Cross, Director of the University of Kentucky Institute for Rural Journalism and Community Issues, explained to the committee the purpose of the Zambians’ visit to Kentucky.


Governor’s Office of Agricultural Policy

The committee received the January and February reports from Mr. Roger Thomas, Executive Director, Mr. Joel Neaveill, Chief of Staff, and Mr. Bill McCloskey, Director of Financial Services, Governor’s Office of Agricultural Policy (GOAP), regarding project funding decisions made by the Agricultural Development Board (ADB) in the previous meetings.


Mr. Neaveill summarized the funding allocations made under the County Agricultural Improvement (CAIP), Deceased Farm Animal Disposal Assistance, and Shared-use Equipment programs from the previous months. He also recapped amendments approved for previously funded projects.


Mr. Neaveill responded to Co-chair Stone, who asked about the scope of participation in CAIP by residents of Jefferson County. A GOAP staff person recalled that Jefferson countians have sought funds for cattle and vegetable production, to name a few. Mr. Thomas pointed out that a positive aspect about CAIP is that each county must offer co-share funding under the various investment areas, whereas counties were not required to do so under a previous program.


In reporting on February Shared-use allocations, the GOAP officials noted that two counties, McCreary and Perry, had received funding under a program created to set aside shared-used equipment funds in counties that receive smaller amounts of county tobacco settlement allocations.


Responding to committee members’ questions, the GOAP officials indicated the Kentucky Beef Network receives about $875,000 in state funding to support on-going cattle production efforts, which is separate from the $310,000 awarded to support the KBN “MAG 60” management and genetics program. Mr. McCloskey also explained that a Washington County Cattlemen’s Association request for additional funds, which total more than an original request, enabled the association to have cost-share funds readily available for 2012.


Mr. Rogers responded to questions from Senator Givens, who asked how efforts had gone to “think outside the box” regarding new and innovative project ideas. According to Mr. Rogers, the ADB had touted that concept and held forums throughout the state in 2011 in an effort to generate ideas. Mr. Rogers pointed out, too, that efforts have been made to urge counties to support regional projects. He mentioned some examples, an on-going Bracken County switchgrass production project and a deceased livestock disposal project in southern Kentucky, and regional meat processing facilities in Garrard and Wolfe counties.


GOAP officials reviewed three state-funded projects, one approved in the January ADB meeting for Padgett Farms LLC, Washington County, which was approved for $15,000 in Washington County funds to install a water line to existing greenhouse facilities, and two in the February meeting, the Edmonton-Metcalfe Industrial Authority, approved for $50,000 in state funds and $100,000 in Metcalfe County funds to build a marketing facility for blueberry production in Metcalfe County, and Garrison Meat Processing, approved for $3,000 in Lewis County funds to expand the meat processing facility. Mr. McCloskey indicated that the Garrison Meat Processing Co. also was approved for a separate $100,000 Kentucky Agricultural Finance Corporation loan.


Referring to the Edmonton-Metcalfe County project, Senator Givens explained to the committee that the industrial authority there became involved in furthering the blueberry industry because it viewed the effort as a part of economic development. Co-chair Stone pointed out that the project is an example of “non-traditional marketing.”


As the meeting ended, Mr. Thomas emphasized the importance, during the budget negotiations, of preserving the Master Settlement Agreement funds granted for agriculture diversification. Co-chair Stone indicated that agriculture in Kentucky has grown with the assistance of the funds. He cited the strong state cattle market as an example.


According to Mr. Thomas, the need for the on-going MSA allocations for agricultural diversification will be important in future years since the final federal tobacco buyout payment checks will be issued in 2014.


There being no further business the meeting was adjourned.