Minnesota Department of Agriculture outlines budget requests and statutory updates, flags lab rent increase

Deputy Commissioner Andrea Vawbel told the House Agriculture Finance and Policy Committee the Minnesota Department of Agriculture's budget request would largely cover operating pressures and proposed statutory changes intended to modernize licensing, broaden grant eligibility, and adjust fee schedules.

Vawbel said the governor's general fund request includes $557,000 in fiscal 2026 and $1,127,000 ongoing thereafter to maintain current service levels, citing rising employer health contributions, rent, utilities and other fixed costs. "These costs do put pressure on agency operating budgets that remain flat from year to year," she said.

The department presented multiple policy and statutory proposals: a food licensing modernization (amend chapters 28A and 31) to simplify licensing and create a new category for home food processors; expansion of the livestock investment grant eligibility (to include tribal and local governments and broaden the species list to rabbits, alpacas, aquaculture, etc.); an increase in the AGRI (Agricultural Growth, Research and Innovation) administrative allowance from 6.5% to 7.5%; an update to grain buyer and grain storage fee schedules; and a proposal to raise the maximum number of retail dispensing sites eligible for the Agri biofuels infrastructure grant program from 10 to 20 to allow more farm co‑ops to apply.

Vawbel also described program‑specific changes such as renaming and broadening the Good Food Access Program to the Food Retail Improvement and Development Grants ("FRIDGE") to reduce stigma and broaden eligibility, and modernizing seed potato certification statutes by repealing Minnesota Statute 21.116's prohibition on general fund use for the program so the program could access general fund stability in exceptional circumstances.

On several clean‑water and agricultural program funding proposals she listed amounts included in the governor's package: Forever Green initiative $6.0 million (FY26–27), nitrate and groundwater program $6.2 million, Ag BMP/soil health equipment grants $3.5 million, Ag Water Quality Certification Program $7.0 million, and others. The packet also flagged a proposed sustainable aviation fuel tax credit carried in the Department of Revenue bill.

Committee members pressed the department on a rent increase for lab facilities the department shares with the Department of Health. Carrie Suki, Facilities Management Director for the Department of Administration, said costs from a 2020 capital project are reflected in lease rates and then depreciated over 30 years. Representative Hansen asked whether the department would absorb roughly $1.12 million in new rent costs out of existing funds; Vawbel said the department seeks ongoing funding to avoid displacing other services.

Vawbel noted the department has hired an agency‑wide compliance coordinator and a grants coordinator who report to the commissioner's office, and emphasized MDA's practice of reconciling every payment request and performing site visits on many grants. "We reconcile every payment request...we review source documentation for every payment request by reviewing invoices for all purchases and ensuring that the vendors have been paid," she said.

Committee members asked clarifying questions about specific proposals — for example how a livestock grant match would be restructured (a tiered match: 50% of the first $20,000 and 20% of the next $220,000 in qualifying expenses) and the reasoning for expanding eligibility for some grants to local units of government (to match language used in other MDA grant programs and allow consistency if an eligible applicant type emerges).

Vawbel asked the committee to consider the package and said the department would follow up with additional details as requested by members.