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House | April 21, 2015 | Committee Room | Agriculture

Full MP3 Audio File

Everyone if once we're done passing this out, we'll start pretty soon. on behalf of two chairs Jame Langley my co chairs would like to welcome you to the house agriculture before we begin we've couple of introductions, appendages for the day Jessica [xx], Joseph Tony representative and Desmond Woods from Wake County sponsored by Representative Gill. We don't seem to have the sergent at arms list here that the committee that person that has normal great, we gonna begin with a little bit of out of the Western start with house bill 553 we want to see if anyone has an objection actually do that Asbel 553 and that is representing the query regulating animals thank you Mr Chairman and particularly thank you for the courtesy I'm supposed to be like many us in two or three places at the same time and I appreciate moving the bill up. the bill summary is completely accurate this bill actually arose out of a situation that occurred in Bumcombe where Bumcombe county initially got into the passed ordinance that was fairy broad regulating a bunch of different bettings setting and housing related to some set of animals including horses. They I think realized error of their ways and if amended the bill but raises a really serious question and that is on the one hand I'm the former county commissioner when I chaired [xx] caucus and I don't want to get local government out of business of dealing with some range of animal issues that they need to use the police powers to deal with us starving animals [xx] but on the other hand as legislators represents, say, in somewhat [xx]. I don't want the cities and counties to start regulating what is I view setting the standard care for that group of animals as most appropriately done state wide by the Ag department so that what the bill is about the bill got significantly redrafted they were comings that the committee council can explain why she took a different approach but there is no change as I understand and what the bill is about here and I'm glad to have represent with my injection  on my Bill Any questions for the bill sponsor, Representative [xx] Mr Chair representing the grate fanqie who are set up by the representative of the county I have been bombarded with a lot of concerns on the original bill and I know. Actually that is the other bill, that's not this bill. We had a talk about the other bill but that's not this one. Thank you for that, thank you I appreciate that. Any other questions? Representative Holley. Thank you Mr. Chair. My question is rather naive. As far as I know that I'm within urban area that are doing a lot of chicken coops now, and I see that poultry is still, and I understand, but I'm still not sure if cities have some regulations for the

location of these kind of things, and how that would affect in a city living will this bill hurt in any way if a neighbors says that the chicken cooper [xx] how do they deal with that in an urban environment? I don't believe that the bill in any sort of zoning powers that the municipalities and counties would have this relate is more towards sort of animal care as opposed to those sorts of uses which are no fully appropriately within the powers of the counties and cities. Representative Robert I just want to that Representative McGrady for putting this bill together I am from [xx] county and I'm a farmer caught up in the you're with the possible [xx] that this is a good solution I support the bill Any other questions Representative Cleveland you're up. Thank you Mr Chairman in favor of the report on house bill 553. I'm sorry I was reading the summary. Favorable report on the proposed committee substitute to House Bill 553 unfavorable of the original bill, and there is no referral. We have the motion before us all those in favor say aye? All those opposed say no? The ayes have it. Next up is House Bill 302. Strengthen Oyster Industry and that's Representative Tine. You have the floor. Thank you Mr. Chairman There's a PCS before us, any motion? All those in favor say aye? Anyone opposed? Go ahead. Thank you Mr. Chairman. Hopefully this bill is one of those when bills, if for those of you don't know oysters clean up the 50 gallons of water a day, one [xx] that put people back work especially in our fishing community as we make it harder to do business, this put another place for them to put their effort continue our culture of working on water. It's a renewable food source, and it also provides habitat to over 24, 500 species, and on top of that they taste all good. Yet we have oyster production in this state that is below 10% of production should be.  So this is a bill to start moving us in the right direction. Section one is a road map about and opportunities. Let's remove some of those impediments that the state has put in place over time that that allow some of them to do more agriculture and more oyster leafs and oyster fishing. Section two is about protecting we have people that corrupted and take houses in where they go in and still in quite frankly the way the senate the senate penalty is alright now its a cost of business and cheaper form to go is [xx] is from itself, section three we make the gene remain selfish, selfish essentially couple in years ago the main question is asking just to make it more special but in the likes part that we can actually be protecting it section four and goes down proposal it's not they is not say that go zone right now the is go zone Euro land to great Gostric North this is also part of the proposal that we considered relation down the road section five is a join over site commission on supper [xx] we have a lot of issues with vision and agriculture apear to get on side of the legislators as overseen everyone from variance let see on top of this issue and make sure every corrupting.. And in section six is the going model is actually the proposal which will be released with regulation and [xx] right now that we got to be the same processing s as if you are doing development right now the dishevelment of the corruption makes you follow regulations so to help Sorry I stand ready for any questions. If there're any questions, recognize Representative Dickson. Record statement on the motion. Mr. Chair. Ladies and gentlemen of committee, you should have seen the young people who came before the Acts and Appropriation committee and gave the presentation on this. This is a good deal, the only bad thing about it

is, it's about ten years is too late but it's better late than never most cheerful motion for perfect man. Any other question before the bill is for so represent the other. Why is the chord sound presently require the host band? My understanding and it's a history that predates my time here, but there was discussion between our fishermen, commercial fishermen and our oyster-men in regards to perhaps limiting the access to those areas if we created some moistening areas they were afraid that they wouldn't be some spots and so that's very particularly in the study when asking for recommendations that both of those parties be consulted so that when we have a proposal to have something to look at as opposed to one side fearing what the other side might do. Representative Brisell. Thank you Mr. Chair just a quick question under representative Turner just help in, oh my God! That was a constituent on that within the right, this is what UNCW is doing now trying to expand. Yes sir, what it does is we have two possible [xx] places that we can into sea, we get our oyster seat from Virginia and right now the department of marine visions has to meet them at the border. This will actually take a look at portable cost actual get those up and running perhaps the public private partnership so North Carolina can be providing their own receiving problems. Any other questions? Representative Dickson you have also just to note that including in your motion some probable changes. Mr. Chair a review of the proposed committee substitute for house bill 202 a favorable report I'm favorable to the original opportunity for the staff to make a technical correction. The motion before you all those in favor Say aye. Aye! Any oppose say no, the bill passes. Next before us is house bill 227 and that would be representative [xx] I've heard there's an amendment [xx] Yes there is, thank you Mr. Chair and [xx] we need to do the amendment first PCS was not able to get that out last night and this amendment is somewhat technical [xx] and I think Representative Waddle is also one the primary sponsor and welcome to come up here with me if [xx] but he's offered the amendment. Representative Riddell is offering an amendment. Inform[sp?] Representative Riddell if he wants to explain the amendment he can, but again it's just pretty much that [xx] Thank you, Mr. Chairman. I'll wait till everybody has a copy of the amendment. Anybody not have the amendment?  Representative Riddell, you're free to explain the amendment. Thank you, Mr Chair. If you look in the very bottom line 26 and 27 of the bill, read Section 2 this Act becomes effective July 1, 2015 and applies to sales made on or after that date, what the amendment does changes the last portion of that the effective date stays the same July 1, 2015 and the change will read, And applies to exemptions and certificates issued on that day because you as [xx] get me sales actual how they apply to the department for a sales tax tention number [xx] Is there any discussion on the amendment? Do I have a motion? Representative [xx] moves to accept the amendment, all those in favor say aah and oppose say no the amendment passes representative [xx]   Thank you Mr chairman this Bill is here before you to split the difference if you will, before we took up tax reforms, small farmers had to provide low income to receive small farmers exemption. And of course I do believe that there are some folks who may have taken the advantage there the tax that increase reform we increase tax to $10, 000 what this bill does is it splits it right down the middle. And says that you have to

produce $5, 000 on your smart reform to receive this exemption from farming and we do it on a large scale, so that is why my family we do it primarily, but the fears a small farmer is probably part time thing, it is probably something that you do as a hobby or something if you will it supplements your income. $10, 000 could be quite a sum to try to generate if we were just doing it part time. And I think 5, 000 is a little more reasonable, it helps keep us honest to make sure we don't have forks taking advantage of claiming to be a smart farm planting a few trees in the backyard of Bona Cow and said there are small farmers of this makes them have to earn 5, 000 as opposed to TN and that's all the bill does, We're happy to answer your questions. Any questions for the bill sponsor, representative Cleveland.   A motion Representative Brison. Thank you Mr. Chair Mr. Colored did those Chicago men they will issue the farm. If they say farm number correct, they have that in place? Yes And they are actually the farm operator, they're not leasing out their farms or whatever you're a producer, is that correct? That's to my understanding, and again, Yes sir. It's hard for me to understand why the power powers and lower then comes in to play because any kind of famine today and is just to be eligible and we just went through re-certification, everybody there's security of tax exempt number had to go back and I certify, and we did change it in [xx] I really didn't understand what estimated operations that is not profits, so you invest if you showed that you invested or you got an expense of $10, 000 in and you are the farm operator Then you qualify if you apply for the tax exemption so I don't know how low on this I mean far things we get help in the body, we could find to get a little smile gunned, I'm saying this ready now to elaborate at the moment they are not operating one of the rest of the rules if they are not able to raise right now. The old world does not understand that you didn't have to show in an investment for being carried off. What we revealed or what we changed what we did to attach your form. The dollar amount, the income, your investment, you didn't even have to get into that.  I suppose that you just had to have the number whatever and what this did when we made the change in all, it did cut a lot of people out that could not show some dollar investment. Whether it was earnings, or whether something they bought, or whatever day, could not show that and what I'm trying to do here is split the difference, do I prefer the old world, do I prefer the way it used to be. Yes, but knowing that finance subject to change it and go from selling zero income, not even going down that road, and putting a $10000 threshold in there, I thought it would be good to find middle ground, take 5000 and have them sure that they invest it properly. Because you're actually doing that and we all know that there are some folks that were eroding this exceptions or that really probably weren't doing much farming and I think the 5000 income or investment it shows that they are somewhat contributing to the farming community so I was just trying to reduce it from 10 to 5 and hope it will capture some of our small problems so  and hopes so that there is no promise and in the next just [xx] understand the bill and I don't make my since having same very very hard representative Greatmark I think one of those. One representative Wemeyr, just a brief note, the fenone starts here operation obliviously is to in many areas 10, 000 should do it, average age of a farmer may be often because it's giving me to 60 certainly be at an average up high mean you are older when you have places where it's urban straw steep slopes [xx] extra your operation is smart to begin with and people scale back their operations or may be they have a series of bad years this is certainly in my opinion and I am an 8th generation product of a firm that I live on that I grew up on and my dad still farms under his age,

their is a situation where you have several hundreds or the two thousand hectors of various types of operations the 10, 000 seems like a drop in the bucket but it is applicable certainly with older folks scaling bag farms that are already constrained by the various things I have mentioned so I ask that you support the bill Follow up, Well I still don't see where lowering this threshold here is going to help any body their is no kind of [xx] and I am glad to say this sub unit firm being renewed today but all of this is an investment we hadn't the $10000 that the new law it's just showing that unique over spending 20 years ago you invest and you got the problem was when we went back and had to structure and you know as well as I know, we had people that have retired firming leasing their land out had been issued a sales exempt so we went back to claim those up because to qualify for this tax exemption. You have to be a farm operator, new business and if you're doing any kind of farming then almost $10, 000 is no sum you can't even buy a garden truck [xx] so I just don't see the advantage here because the people that you're trying to get in now is, if anyone qualifies they're not non-qualified, this is the dominion I can tell you that. Representative Pricey if five of us get him in then we're not farming and that's what we were trying to do is to make it a little bit easier. I understand what you're saying, I do think it sometimes it can be difficult to get the 10 I don't know if we agreed that it's as easy to get there as you're saying. Bill I know you're a farmer my family that's what we do, this bill doesn't even impact us at all. That what we do, 10, 000, if we're not making $10, 000 for a start but but I think that to me this is a just a middle of the road approach. I had a number of people who called me that used to get the exemption that no longer could get it, and this is just trying to help them, and I'm getting a note here and I can't [xx] We'll let you just go ahead. Mr. Chair? Go ahead. One other angle there too is for your farmers, new farmers that are just entering to, it's just one more way to expedite their entry there. Representative Waddell. Thank you, Mr. Chair and I appreciate the bill sponsor for bringing this forward because I've had trials[sp?] too like I'm sure some of the other ones that you have. Just question, a quick question. Does this bill require a schedule let to be submitted? I'll have to defer to staff on that one or I'm not sure. Staff, you have something[sp?]? Thank you, Mr. Chairman. The only requirement to be a qualifying farmer is that you have an annual gross income for the preceding taxable year of $10, 000 or more from farming operations or an average And in the recent term the attendance due for the proceeding three years in forming operations. I made a mistake and that I believe in the original bill that was a requirement that was scheduled to lead at the debate. Senator could you answer that. Could you repeat that representative Martin.  I believe an original we gaze they have farmers exception that they have scheduled that capital to this bill. I support it, I know I had chance spare the life of man when I request my exemption. On our own server.  Thank you Mr. Chair I approve of the application, I would double check and. Representative Dickson. Thank you Mr chair, the process is to choose are the qualified, there is an application form that you fill out and certify and the oath that we're receiving up to now, our approach is humor. I oppose because we just [xx] bill and tight reform, and we found out is that there in

excess 40 thousand people claiming this exemptions, this is repeat correct of action, we had a situation where a person will go to the equipment twice the bio [xx] and in the process of selling [xx] equipment is a high risk you're not a farmer, why don't you go and tell Jane, Jane is a farmer who can get you less expensive equipment that farm require just on. I'm not going in the minute program do giant about those guns [xx] ladies and gentlemen of the committee I think that at some point in time this bill might be affirmative, but I don't think, and with all due respect time to settle, to see what the situation was and if you're talking about $10, 000 the amount of sales tax exemption that they would be eligible for is pocket change. And so, I've got this calls to I haven't gotten a single call encouraging me to go against this. Every single call I've got has been for me to support this Bill, but I'm not aware we are being asked to support this Bill, but it is not really a critical thing it was going to do what the Bill sponsors might think that it is going to do. It sounds good, it sounds that we could help ground farmers, the beginning primaries get started. But to the Bill sponsor I would say this, let's give it another year to let this thing settle out, I got a request from the revenue right now, that would report to me the difference between the number of people that were qualified for it, and under the new How many qualify, let's look at that preview and then see if can picture down to see whether it really would be reasonable to reduce this, at least to reduce from 10, 000 to about $5, 000. Now it is not significant in my opinion, I agree personally. Thank you. And Chairman Dickson, I mean, I appreciate your comments, and I would agree that with old law, it was very easy to get this, and that's why they chose 10, 000, in my personal opinion they chose a number that was a little too high obviously a big fan of our body for our tax reforms. However, we have encountered some other situations this session. That we are having to go back can take a second to look at, this is one of them and I've said I got a great number of phone call from folks from my district and that is our job I think to represent those folks and try to help them. If I was interested in just a part of giveaway I would have just taken it back to exactly what it used to be, and have no income requirements, but 5, 000, 10, 000 I do still think it is difficult to get that $10, 000 I think probe is more fair, and I don't see that this is going to be a large chunk revenue that is going to hurt the state in one way or the other, correct. I think this bill has got to take dip through finance so this is not, it's call, so I'd ask the members to let it move on today, move on to Finance, I'm sure we'll have a big discussion there about how much it's going to cost the state et cetera, and again it's just moving to contain the crop and I do think that that helps to take away a lot of new farmers started, I don't think this bill hurts anything at all. Representative Martin. Thank you Mr. Chair and as you might imagine I have mention about the financial impact and was wondering if there is a physical matter we know right since this is interpreted to past. Representative [xx] a request to get a peaceful note, I have figured that it would take up the fiasco impact caled if we made to fund ends service solicits is not to fund it's committee and as result can just talk about subject matter here and when it comes to you but I will tell you I know that's not expensive field at all Representative Jack will you ask a question. Thank you Mr [xx] I hadn't thought about this bill in terms of 50 grands about track suit in all ways that say I outstage on but the way I look is really was, we have a lot of people, allies that have green have these small wing in health equal those votes where those and where is him being here spring back yet, for all the avionic sounds left implement same thing with free wine engage, it's just small off road but they all

form and so I'm [xx] bill on the purpose just bill and I would and you could dial on the end and this and if you bought a truck your infront size form, you probobaly easy get a 10 or 5, and there are lot of folks who do just exactly what you say Representative Zachary, that do these small things and it's difficult to meet that income requirement. Well we're at the second last, we're at Representative Dickson. I want everybody to understand that they have to produce $10, 000 worth of gross income, the sales tax exemption is the sales tax applied to whatever they would buy, and if you're producing just $10, 000 you're not buying much and you're not performing as much. And so there was a time or two that there seemed to be some questions on folks [xx] space, this is a sales tax exemption form related to various people who certify that they have $10, 000 or more of gross income from their farming operation [xx] questions but Representative [xx]   Thank you Mr. Chairman, I'm not sure what I'm going to ask is a matter of substance this bill is just semantics. But seems to me that talking about income is not the same thing as talking about profit you can have $5000 income and still have a loss, and say that maybe might be operants and paper then I need to operate at a law strictness, and I was wondering if you could come in and represent [xx] on that matter. You're exactly right, income is not necessarily profit, and you could possibly be helping someone who is at a loss whether you are operating a farm on a small a large scale, I can ensure you that it is an expensive endeavor and even a $5000 income they still could be easily losing money. Yes. Representative [xx]. Thank you Mr. Chair. The key thing to keep in mind here this is about small business. That's what this is for, is to help the small farm in operations, generally just starting now or internet noberty and niche trying to make away and the $5, 000 drop down we are not giving in a free ride like we did at zero I don't think that was the best way to go. It's 5000 it's just a criteria that says you're got to have skinning again, you got to be serious about what you're doing because so it's 5000 on gross increase mention not net profit and I think this is a way to encouraging a new generation of farmers.  Thank you, representative Harger.  This is the most requested bill I have got from the that community and we have lot's of young farmers, we have lots of small cattle farm, it may not seem like a lot of money, other areas of within the mountains we have small farms and it's very important that we get this passed. Representative Harley, you want to have the last word then we'll on the motion And jut ask a member of at the end I representative Vadel said, think about webs and just get started think about the niche, they will form us around there, is not a great deal of money but it means lot this folks are just done getting started and I just ask for your support. Thank you. Let's move. Is there a motion before us. I'm sorry. Thank you Mr. Chairman, favorable on house bill 227 as amended consider it roll it into PCS?. If you're verifying this. Yes we're verifying this. If you answered the motion all those in favor will say I all those opposed say no.  It is the ayes have it, The ayes have it. The bill passes, last one our list is house bill 378 and once again we see representative Whitmire honorable [xx] Thank you, Mr. Chairman it's a committee substitute Mr. Chairman. Is there a motion before us? Representative Glazier committee substitute proposed committee substitute for the discussion. All those in favor will say aye, opposed say no. PCS before us.

Thank you Mr. Chair, thank you committee, thank you for my primary sponsors join me on this. I'm going to take the brief approach and then certainly answer your questions follow I'm glad to answer. I know of no known opposition is supported by department of [xx] that can beyond the grades and other the key piece here we have program that are established and have validated themselves over time so what does the tremendous water quality and water quantity programs and in order for those programs to realize the potentioal you now this situation an the whole thing is it come into play on what the current criteria is, if you've got eight hogs in the river of crick, versus what it might take to put you have a certain thresholds, a few more, they're still, point non-point sources of issues to deal protocol and again I'm eight generation farm product and still live on that farm today. So, in essence 378, will ensure that the intended purpose of many of our cost share programs, can help address by making sure people who want to voluntarily cost share in these programs that address anything, from soil erosion, to fertilizer runoff, to animal waste, whatever, that they will have elligibility to do it, and I'll simply add, at first, this situation it motivated me to do this bill, I was seeing more in the West aging you haven't mentioned earlier steep slopes were found to still be smaller, in other words, mountains go down the valleys, floods, you very much strained on what you can't promise going to mention great things you gonna get great, those things that can strange with as good nature with more of stakeholders it's important is I [xx] to it's Steven Taway I guess the last thing I was saying is this is not a give away you know in 100 counties we have non is it on what the districts? They are stake of bodies the directories of those programs well that and by [xx] actually gets to participate in the particular program and all stages of the programs makes some of it simple, so this is now like we all amid the door that something that people who are, they are not intended they will be able to take advantage of money that should go elsewhere and the bill basically says, if the African satisfies the bonafide reform criteria then they can, they are eligible for this programs and with that Mr. Chair there being no question is so cool, it's no many and thank you. Any question fro the bill sponsor? Representative DIckson. For a motion. Any other rather discussion? Representative Dickson you are recognized. Motion to give a favorable report to a House Bill 378 ECS unfavorable to the original. The motion is before us all those in favor will say aye? And opposed will say no? The bill passes. Thank you. At this point we are to our agenda and this meeting will as adjourned.