AB 1044: California Agriculture Relief Act.
- Session Year: 2023-2024
- House: Assembly
- Latest Version Date: 2023-04-05
Current Status:
Failed
(2024-02-01: From committee: Filed with the Chief Clerk pursuant to Joint Rule 56.)
Introduced
In Committee
First Chamber
In Committee
Second Chamber
Enacted
Existing law, until January 1, 2025, establishes the California Small Agricultural Business Drought Relief Grant Program in the Office of the Small Business Advocate, under the authority of its director, to provide grants to qualified small agricultural businesses that have been affected by severe drought conditions. Existing law requires the office to allocate grants to qualified small agricultural businesses that meet the requirements of the program, upon appropriation of grant funds by the Legislature.
This bill bill, the California Agriculture Relief Act, would appropriate $100,000,000 from the General Fund to the office to provide grants under the program. The bill would also make related findings and declarations.
(1)Existing law imposes various limitations on the emissions of air contaminants for the control of air pollution from vehicular and nonvehicular sources. Pursuant to that authority, the State Air Resources Board has adopted a regulation to reduce oxides of nitrogen, diesel particulate matter, and other criteria air pollutant emissions from in-use, diesel-fueled vehicles.
This bill would require the state board to exempt agricultural vehicles and specialty agricultural vehicles that do not exceed 10,000 miles of operation annually from any regulation to reduce emissions of diesel particulate matter, oxides of nitrogen, and other criteria air pollutants from in-use, diesel-fueled vehicles.
The bill would also prohibit the state board from adopting any regulation that requires an off-road agricultural vehicle or piece of equipment to satisfy any zero-emission requirement.
(2)Existing law, until January 1, 2025, establishes the California Small Agricultural Business Drought Relief Grant Program in the Office of the Small Business Advocate, under the authority of its director, to provide grants to qualified small agricultural businesses that have been affected by severe drought conditions. Existing law requires the office to allocate grants to qualified small agricultural businesses that meet the requirements of the program, upon appropriation of grant funds by the Legislature.
This bill would appropriate $100,000,000 from the General Fund to the office to provide grants under the program.
Existing law provides that there is in state government the Department of Food and Agriculture under control of the Secretary of Food and Agriculture. Existing law requires the department to promote and protect the agricultural industry of the state.This bill would declare the intent of the Legislature to enact subsequent legislation, the Agricultural Relief Act, to provide significant assistance to Californias burdened agricultural sector. The bill would make related findings and declarations.Existing law provides that there is in state government the Department of Food and Agriculture under control of the Secretary of Food and Agriculture. Existing law requires the department to promote and protect the agricultural industry of the state.
This bill would declare the intent of the Legislature to enact subsequent legislation, the Agricultural Relief Act, to provide significant assistance to Californias burdened agricultural sector. The bill would make related findings and declarations.
This act shall be known, and may be cited, as the California Agriculture Relief Act.
SEC. 2.The Legislature finds and declares all of the following:
(a)The agricultural industry is vital to the health of Californias economy, producing over 400 crops and employing over 400,000 people.
(b)California is a state that feeds the nation, growing over one-third of the countrys vegetables and three-quarters of the countrys fruits and nuts.
(c)The 202022 drought has had severe economic impacts on the agricultural industry, with an estimated 395,000 acres of farmland fallowed and notable decreases in the production of many commodities. These impacts will likely intensify due to Californias rigid regulatory environment.
(d)The COVID-19 pandemic interrupted supply chains, with agriculture being one of the most severely affected markets, including farms, processors, handlers, retail outlets, and trade. The industry has still not recovered from these impacts.
(e)High-input costs combined with inflation and regulatory expenses have put the agricultural industry in a precarious situation.
(f)Walnut, tomato, and almond prices have been significantly impacted by the COVID-19 supply chain crunch and drought conditions, driving prices to record lows and jeopardizing producers continued operation.
SEC. 3.Section 43013.4 is added to the Health and Safety Code, to read:43013.4.(a)As used in this section, the following definitions apply:(1)Agricultural vehicle has the same meaning as in paragraph (5) of subdivision (d) of Section 2025 of Title 13 of the California Code of Regulations, as it read on January 1, 2023.(2)Specialty agricultural vehicle has the same meaning as in paragraph (54) of subdivision (d) of Section 2025 of Title 13 of the California Code of Regulations, as it read on January 1, 2023.(b)The state board shall exempt from any regulation to reduce emissions of diesel particulate matter, oxides of nitrogen, and other criteria air pollutants from in-use, diesel-fueled vehicles, any agricultural vehicle or specialty agricultural vehicle that does not exceed 10,000 miles of operation annually.SEC. 4.Section 43018.12 is added to the Health and Safety Code, to read:43018.12.The state board shall not adopt any regulation that requires an off-road agricultural vehicle or piece of equipment to satisfy any zero-emission requirement.SEC. 5.SEC. 3.The sum of one hundred million dollars ($100,000,000) is hereby appropriated from the General Fund to the Office of the Small Business Advocate to provide grants under the California Small Agricultural Business Drought Relief Grant Program (Article 9.5 (commencing with Section 12100.100) of Chapter 1.6 of Part 2 of Division 3 of Title 2 of the Government Code) to qualified small agricultural businesses that have been affected by severe drought conditions.
This act shall be known, and may be cited, as the California Agriculture Relief Act.
SECTION 1.SEC. 2.The Legislature finds and declares all of the following:
(a)The agricultural industry is vital to the health of Californias economy, producing over 400 crops and employing over 400,000 people.
(b)California is a state that feeds the nation, growing over one-third of the countrys vegetables and three-quarters of the countrys fruits and nuts.
(c)The 202022 drought has had severe economic impacts on the agricultural industry, with an estimated 395,000 acres of farmland fallowed and notable decreases in the production of many commodities. These impacts will likely intensify due to Californias rigid regulatory environment.
(d)The COVID-19 pandemic interrupted supply chains, with agriculture being one of the most severely affected markets, including farms, processors, handlers, retail outlets, and trade. The industry has still not recovered from these impacts.
(e)High input High-input costs combined with inflation and regulatory expenses have put the agricultural industry in a precarious situation.
(f)Walnut and almond Walnut, tomato, and almond prices have been significantly impacted by the COVID-19 supply chain crunch and drought conditions, driving prices to record lows and jeopardizing producers continued operation.
SEC. 3.Section 43013.4 is added to the Health and Safety Code, to read:43013.4.(a)As used in this section, the following definitions apply:
(1)Agricultural vehicle has the same meaning as in paragraph (5) of subdivision (d) of Section 2025 of Title 13 of the California Code of Regulations, as it read on January 1, 2023.
(2)Specialty agricultural vehicle has the same meaning as in paragraph (54) of subdivision (d) of Section 2025 of Title 13 of the California Code of Regulations, as it read on January 1, 2023.
(b)The state board shall exempt from any regulation to reduce emissions of diesel particulate matter, oxides of nitrogen, and other criteria air pollutants from in-use, diesel-fueled vehicles, any agricultural vehicle or specialty agricultural vehicle that does not exceed 10,000 miles of operation annually.
SEC. 4.Section 43018.12 is added to the Health and Safety Code, to read:43018.12.The state board shall not adopt any regulation that requires an off-road agricultural vehicle or piece of equipment to satisfy any zero-emission requirement.
SEC. 5.The sum of one hundred million dollars ($100,000,000) is hereby appropriated from the General Fund to the Office of the Small Business Advocate to provide grants under the California Small Agricultural Business Drought Relief Grant Program (Article 9.5 (commencing with Section 12100.100) of Chapter 1.6 of Part 2 of Division 3 of Title 2 of the Government Code) to qualified small agricultural businesses that have been affected by severe drought conditions.
SEC. 2.It is the intent of the Legislature to enact subsequent legislation, the Agricultural Relief Act, to provide significant assistance to Californias burdened agricultural sector.The Legislature finds and declares all of the following:
(a)The agricultural industry is vital to the health of Californias economy, producing over 400 crops and employing over 400,000 people.
(b)California is a state that feeds the nation, growing over one-third of the countrys vegetables and three-quarters of the countrys fruits and nuts.
(c)The 202022 drought has had severe economic impacts on the agricultural industry, with an estimated 395,000 acres of farmland fallowed and notable decreases in the production of many commodities. These impacts will likely intensify due to Californias rigid regulatory environment.
(d)The COVID-19 pandemic interrupted supply chains, with agriculture being one of the most severely affected markets, including farms, processors, handlers, retail outlets, and trade. The industry has still not recovered from these impacts.
(e)High input costs combined with inflation and regulatory expenses have put the agricultural industry in a precarious situation.
(f)Walnut and almond prices have been significantly impacted by the COVID-19 supply chain crunch and drought conditions, driving prices to record lows and jeopardizing producers continued operation.
SEC. 2.It is the intent of the Legislature to enact subsequent legislation, the Agricultural Relief Act, to provide significant assistance to Californias burdened agricultural sector.
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Date
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Status
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|---|---|
| Feb 1, 2024 | From committee: Filed with the Chief Clerk pursuant to Joint Rule 56. |
| Jan 31, 2024 | Died pursuant to Art. IV, Sec. 10(c) of the Constitution. |
| Jan 18, 2024 | In committee: Held under submission. |
| May 18, 2023 | In committee: Hearing postponed by committee. |
| May 10, 2023 | In committee: Set, first hearing. Referred to APPR. suspense file. |
| Apr 25, 2023 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 7. Noes 0.) (April 25). Re-referred to Com. on APPR. |
| Apr 24, 2023 | Joint Rule 62(a), file notice suspended. (Page 1297.) |
| Apr 17, 2023 | In committee: Set, first hearing. Hearing canceled at the request of author. |
| Apr 17, 2023 | Re-referred to Com. on J., E.D., & E. pursuant to Assembly Rule 96. |
| Apr 6, 2023 | Re-referred to Com. on TRANS. |
| Apr 5, 2023 | From committee chair, with author's amendments: Amend, and re-refer to Com. on TRANS. Read second time and amended. |
| Mar 20, 2023 | Re-referred to Com. on TRANS. |
| Mar 16, 2023 | From committee chair, with author's amendments: Amend, and re-refer to Com. on TRANS. Read second time and amended. |
| Mar 16, 2023 | Referred to Coms. on TRANS. and NAT. RES. |
| Feb 16, 2023 | From printer. May be heard in committee March 18. |
| Feb 15, 2023 | Read first time. To print. |
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Date
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Description
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Location
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Votes
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| Apr 25, 2023 | Do pass and be re-referred to the Committee on [Appropriations] | Assembly Standing Committee on Jobs, Economic Development, and the Economy |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
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Organization
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Position
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Date
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| California Rice Commission | ** Support | |
| California Warehouse Association | ** Support |
Date of Hearing: May 10, 2023
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Chris Holden, Chair
ABPCA Bill Id:AB 1044
Author:(Gallagher) – As Amended Ver:April 5, 2023
Policy Committee: | Jobs, Economic Development, and the Economy | Vote: | 7 - 0 |
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Urgency: No State Mandated Local Program: No Reimbursable: No
SUMMARY:
This bill appropriates $100 million General Fund to the Office of the Small Business Advocate at the Governor’s Office of Business and Economic Development (GO-Biz) to provide grants through the existing California Small Agricultural Business Drought Relief Grant Program to qualified small agricultural businesses that have been affected by severe drought conditions.
FISCAL EFFECT:
- One-time General Fund costs of $100 million to provide grants to the California Small Agricultural Business Drought Relief Grant Program.
- One-time General Fund costs of about $3 million to GO-Biz for staff to administer the new grant program. According to GO-Biz, funding from other programming was used to administer the current program, described below. GO-Biz indicates it would require additional funding to administer the augmentation this bill provides.
COMMENTS:
Background. AB 157 (Committee on Budget), Chapter 570, Statutes of 2022, establishes, until January 1, 2025, the California Small Agricultural Business Drought Relief Grant Program to be administered by the California Office of the Small Business Advocate within GO-Biz. The program is to provide grants to qualified small agricultural businesses that have been affected by severe drought. The Budget Act of 2022 (SB 154, Skinner) provided $75 million to the program.
This bill appropriates significantly more funding to the program.
Analysis Prepared by: Natasha Collins / APPR. / (916) 319-2081
Date of Hearing: April 25, 2023
ASSEMBLY COMMITTEE ON JOBS, ECONOMIC DEVELOPMENT, AND THE ECONOMY
Carlos Villapudua, Chair
ABPCA Bill Id:AB 1044 (
Author:Gallagher) – As Amended Ver:April 5, 2023
SUBJECT: California Agriculture Relief Act
SUMMARY: The California Small Agricultural Business Drought Relief Grant Program within the Office of the Small Business Advocate, under the authority of its director, will provide grants to qualified small agricultural businesses that have been affected by severe drought conditions.
Specifically, this bill: Shall be known, and may be cited, as the California Agriculture Relief Act.
The Legislature finds and declares all of the following:
- The agricultural industry is vital to the health of California’s economy, producing over 400 crops and employing over 400,000 people.
- California is a state that feeds the nation, growing over one-third of the country’s vegetables and three-quarters of the country’s fruits and nuts.
- The 2020–22 drought has had severe economic impacts on the agricultural industry, with an estimated 395,000 acres of farmland fallowed and notable decreases in the production of many commodities. These impacts will likely intensify due to California’s rigid regulatory environment.
- The COVID-19 pandemic interrupted supply chains, with agriculture being one of the most severely affected markets, including farms, processors, handlers, retail outlets, and trade. The industry has still not recovered from these impacts.
- High-input costs combined with inflation and regulatory expenses have put the agricultural industry in a precarious situation.
- Walnut, tomato, and almond prices have been significantly impacted by the COVID-19 supply chain crunch and drought conditions, driving prices to record lows and jeopardizing producers’ continued operation.
EXISTING LAW:
- Existing law, until January 1, 2025, establishes the California Small Agricultural Business Drought Relief Grant Program in the Office of the Small Business Advocate, under the authority of its director, to provide grants to qualified small agricultural businesses that have been affected by severe drought conditions.
- Existing law requires the office to allocate grants to qualified small agricultural businesses that meet the requirements of the program, upon appropriation of grant funds by the Legislature.
- SB 154 (Skinner) Budget Act of 2022: allocates original funding in the amount of $75 million (See line item 8570-101-3398).
- AB 157 (Committee on Budget) 2022: Creates the California Small Agricultural Business Drought Relief Grant Program within the Office of Small Business Advocate (office) to provide grants to qualified small agricultural businesses that have been affected by severe drought conditions.
- Provides that the office may contract with a fiscal agent to carry out the program, at a rate of no more than 5% of the funds.
- Provides that grants to qualified small agricultural businesses may be administered in one or more rounds and requires the office to conduct marketing and outreach for equitable awareness and the distribution of grants, as specified.
- Defines "qualified small business" as a business that meets all of the following, as confirmed by the office or fiscal agent through review of revenue declines, other relief funds received, credit history, tax returns, payroll records, and bank account validation:
- Is a sole proprietor, independent contractor, C-corporation, S-corporation, cooperative, Limited Liability Company, partnership, nonprofit, or limited partnership, with 100 or fewer full-time employees in the 2022 taxable year
- Experienced a decline in annual gross receipts or gross profits of 10% or more.
- Began operating in the state prior to January 1, 2020.
- Is currently active and operating.
- Has been affected by severe drought according to the United States Department of Agriculture drought monitor.
- Provides organizing documents, including a federal tax return or Internal Revenue Service Form 990, and a copy official filings with the Secretary of State or with local municipality, as applicable, including, but not limited to, articles of incorporation, certificate of organization, fictitious name of registration, or government-issued business license.
- Specifies that "qualified small business" shall not include:
- Businesses without a physical presence in the state.
- Governmental entities, other than Native American tribes, or elected officials offices.
- Businesses primarily engaged in political or lobbying activities, regardless of whether the entity is registered as a 501(c)(3), 501(C)(6), or 501(c)(19) nonprofit entity or other nonprofit entity.
- Passive business, investment companies, and investors who file a Schedule E on their tax returns.
- Financial institutions or businesses primarily engaged in business of lending, such as banks, finance companies, and factoring companies.
- Businesses engaged in any activity that is unlawful under federal, state, or local law.
- Businesses that restrict patronage for any reason other than capacity.
- Speculative businesses.
- Businesses with any owner of greater than 10% of the equity interest in it as specified.
- Affiliated companies, as described in Section 121.103 of Title 13 of the Code of Federal Regulations, as it read on August 1, 2022.
- Other businesses to be determined by the office consistently with requirements and intent of this subdivision.
- Provides grants to be awarded as follows:
- 10% of the grant funds shall be held for qualified small agricultural businesses that do not file 2022 tax year returns until 2024.
- 20% of the grant funds shall be allocated in one or more rounds for small and socially disadvantaged farmers who are qualified small agricultural businesses as specified
- Remaining percentage of grants funds shall be allocated to qualified small agricultural businesses most impacted by severe drought, including, but not limited to, those identified in the 2022 North American Industry Classification System codes, as specified.
- Provides that grants be awarded as follows:
- $60,000 for applicants with a decline in annual gross receipts or gross profits of 30% or more and less than 40%.
- $80,000 for applicants with a decline in annual gross receipts or gross profits of 40% or more and less than 60%.
- $100,000 for applicants with a decline in annual gross receipts or gross profits of 50% or more.
- Requires that grant money awarded shall be used for costs to maintain the recipient business through the drought including:
- Employee expenses, including payroll costs, health care benefits, paid sick, medical, or family leave, and insurance premiums.
- Working capital and overhead, including rent, utilities, mortgage principal, and interest payments, but excluding mortgage prepayments, and debt obligations, including principal and interest, incurred before the onset of severe drought.
- Any other drought-related expenses not already covered through grants, forgivable loans, or other relief through state, county, or city programs.
- Requires the office to report to the Legislature about diversity on or before December 31, 2024.
FISCAL EFFECT: $100,000,000 from the General Fund to the office The California Agriculture Relief Act.
COMMENTS: The 2020–22 drought has had severe economic impacts on the agricultural industry, with an estimated 395,000 acres of farmland fallowed and notable decreases in the production of many commodities including walnut, tomato, and almond.
The COVID-19 pandemic interrupted supply chains, with agriculture being one of the most severely affected markets, including farms, processors, handlers, farm workers, retail outlets, and trade. The industry is still recovering from these impacts.
The California Small Agricultural Business Drought Relief Grant Program is a state-funded grant program designed to provide financial assistance to small agricultural businesses that have been impacted by the ongoing drought in California. The program is administered by the California Office of the Small Business Advocate (CalOSBA), which is part of the Governor’s Office of Business and Economic Development (GO-Biz).
The program provides grants of up to $25,000 to eligible small agricultural businesses to assist with expenses related to drought impacts, such as the cost of irrigation system upgrades, water hauling, and emergency water supplies. To be eligible for the program, businesses must meet several requirements, including:
- Be a small business with 1-50 employees and a maximum revenue of $2.5 million
- Be located in California
- Be primarily engaged in agricultural activities
- Demonstrate a financial impact due to drought conditions
The program has received $75M in funding through the state budget and is aimed at providing relief to small agricultural businesses that may not have access to other forms of financial assistance. The grant funds can be used to cover costs incurred between January 1, 2021, and December 31, 2022.
Author’s Statement: The 2020-22 drought had severe impacts on California farmers with significant economic losses and the fallowing of 395,000 acres of farmland. The PPIC estimates the drought caused $1.7 billion in lost revenue and 14,600 in lost jobs. The California Agriculture Relief Act is a necessary step to support California’s agricultural industry in the face of ongoing challenges. By providing financial support, this act will help small family farms and business continue to operate and ensure the industry’s continued viability.
REGISTERED SUPPORT / OPPOSITION:
Support
California Warehouse Association
Opposition
None on file
Analysis Prepared by: Carla Castilla / J., E.D., & E. / (916) 319-2090
Date of Hearing: April 17, 2023
ASSEMBLY COMMITTEE ON TRANSPORTATION
Laura Friedman, Chair
ABPCA Bill Id:AB 1044 (
Author:Gallagher) – As Amended Ver:April 5, 2023
SUBJECT: California Agriculture Relief Act
SUMMARY: Appropriates $100,000,000 General Fund to the Office of the Small Business Advocate (CalOSBA) to provide grants under the California Small Agricultural Business Drought Relief Grant Program to qualified small agricultural businesses that have been affected by severe drought conditions.
EXISTING LAW:
- Provides $75,000,000 one-time California Emergency Relief Fund for the California Small Agricultural Business Drought Relief Grant Program for CalOSBA within the Governor’s Office of Business and Economic Development (GO-Biz).
FISCAL EFFECT: Unknown
COMMENTS: Last year’s Budget provided $75 million in one-time funding for the California Emergency Relief Fund for the California Small Agricultural Business Drought Relief Grant Program for CalOSBA within GO-Biz.
The author has introduced this bill to provide additional resources because “the current challenges faced by California’s agricultural industry will require additional and more significant investment. High input costs combined with inflation and regulatory expenses have put the agricultural industry in a precarious situation. For example, walnut and almond prices have been significantly impacted by the COVID-19 supply chain crunch and drought conditions, driving prices to record lows and jeopardizing producers’ continued operation. The price of walnuts has plummeted well below the cost of production, with the price to growers for the 2022 walnut crop at about 40 cents per pound or less, well below last year’s break-even price of 70 to 90 cents per pound. The situation is so catastrophic that on January 13th, U.S. Agriculture Secretary Tom Vilsack designated a disaster declaration for Stanislaus, Alameda, Calaveras, Mariposa, Merced, San Joaquin, Santa Clara and Tuolumne counties for walnut losses due to the heat wave last September.”
According to the author, “The California Agriculture Relief Act is an approach to provide critical regulatory relief and financial support to struggling California farmers. [This bill] would allocate $100 million to the California Small Agricultural Business Drought Relief Grant Program. This would provide crucial financial support to small agricultural businesses grappling with devastating effects of drought.”
In support the California Warehouse Association writes, “[This bill] is necessary to support California’s agricultural industry in the face of ongoing challenges. By providing regulatory certainty and financial support, this bill will help family farms and businesses continue to operate and ensure the agriculture industry’s continued viability.”
Double referral: This bill is double referred to the Assembly Natural Resources Committee and will be heard by that Committee as it relates to issues under its jurisdiction, should it pass out of this committee.
Previous legislation: AB 157 (Committee on Budget. State Government), Chapter 570, Statutes of 2022 establishes, until January 1, 2025, the California Small Agricultural Business Drought Relief Grant Program in CalOSBA, under the authority of its director. States the purpose of the program as providing grants to qualified small agricultural businesses that have been affected by severe drought. Prescribes various definitions for its purposes, including that of a qualified small business. Authorizes CalOSBA to contract with a fiscal agent, as defined, to carry out the program, and requires CalOSBA to allocate grants to qualified small agricultural businesses that meet the requirements, upon appropriation of grant funds by the Legislature. Prescribes the criteria for specific grant amounts, which would be based on the loss or decline in annual gross receipts or gross profits, which would be established by comparing the 2022 taxable year to the 2019 taxable year, as specified. Provides for the recapture of grants if grantees fail to meet required criteria. Requires that grant moneys be used only for costs to maintain the business through the drought, and specifies certain authorized costs in this regard.
REGISTERED SUPPORT / OPPOSITION:
Support
California Rice Commission
California Warehouse Association
Opposition
None on file
Analysis Prepared by: Christine Casey / TRANS. / (916) 319-2093
Bill Author
Bill Co-Author(s):