Extending the bovine TB tax credit

A bovine tuberculosis outbreak in cattle near Roseau several years ago forced ranchers to stop using their pastures and destroy the animals to stop the spread of the disease.

They were given a property tax credit to alleviate some of their financial losses and because the pastures are not suitable for other uses. In 2010, the Board of Animal Health certified that a large portion of the affected zone was free of bovine TB, which automatically turned off the property tax credit.

However, 22 of the previous 276 restricted herds are still subject to another year of bovine TB testing. These ranchers would continue to receive the property tax credit under HF1890, sponsored by Rep. Dan Fabian (R-Roseau).

The House Agriculture and Rural Development Policy and Finance Committee approved the bill Feb. 9 and referred it to the House Taxes Committee, with the understanding that it would come back to the committee if funding for the tax credits comes from the Department of Agriculture’s budget.

“I appreciate the concern, but this was supposed to be a temporary program. This is a good example of when a program becomes an entitlement,” said Rep. Rick Hansen (DFL-South St. Paul).

Rep. Kent Eken (DFL-Twin Valley) supports the bill because the restrictions for the 22 herds are still in place. “This is something the whole state benefits from,” Eken said. “I don’t think the whole burden should be borne by those directly impacted.”

Preliminary cost estimates project $100,000 in tax credits could be awarded to affected ranchers. It was unclear whether the money would come from the General Fund or from the Department of Agriculture’s budget.

Rep. John Ward (DFL-Brainerd) asked whether the $100,000 cost would be shifted onto other county property owners. Fabian said the funding details would be worked out in the House Taxes Committee.

A companion, SF1555, sponsored by Sen. LeRoy Stumpf (DFL-Plummer), awaits action by the Senate Taxes Committee.