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Page V-1 Monday, August 2, 2010 FarmWeek

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Illinois’ dangerous intersection: How can the state pull out of its fiscal skid with the least injury?

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he State of Illinois is in financial collapse. There isn't a day that goes by that you don't read about someone not getting paid or some constituent service or

Reading the signs RICH GUEBERT JR.

Chairman, Illinois Farm Bureau Resolutions Committee With funding for research and education ever dwindling, an exploding global population, a greater need for affordable, safe, and abundant production, and an increasing emphasis on environmental stewardship, perhaps at no time in history has agriculture been at a more critical crossroads. For that reason, it has never been more important that organizational policy is current in reflecting your views on the range of issues surrounding agriculture. Our passion — which happens to double as our business — must find a way to exist in a still-evolving new paradigm. We must not only respond to current issues, but we must anticipate trends that often originate outside the borders of our control. We can build into our business plans contingencies for weather, price fluctuations, and production —but one variable for which we cannot plan is public opinion. And so it is this crossroads at which we stand—our current production and business models working at peak efficiency facing a public that might force us to alter those models. This annual FarmWeek supplement will hopefully arm you with some of the information you will need to make so many important decisions at such a critical juncture.

program being cut or eliminated. Local school districts, units of local government, and private business are in near bankruptcy because of the instability of state funds. Our elected officials continue to attempt to patch the mess together with no long-term fix. Potential answers to how the mess will be fixed have been few and far between. Many ideas have been floated, but none gains enough political momentum to be considered. If the fiscal demise is not addressed, how much worse will it get? That leads right into how bad it is now. If this were a family farm or business, the bank and our suppliers would have cut us off a long time ago and sent the sheriff to put a big red "Foreclosed" sign on the front door. Let's look at some quick facts. The state has close to $7 billion in unpaid bills. That is equal to almost 27 percent of the state’s yearly tax collections. If we put it in other items that are not included in the state budget, such as the annual state pensions payments for this year of $3.7 billion, the deficit percentage jumps to 41 percent of the state tax collections. Then add to that all the new interest payments for all the borrowing the state has been doing to stay afloat, health care payment increases, other program cost increases, and declining tax revenue collections of an additional $4 billion and the total comes to a $13 billion deficit. That is is equal to 50 percent of the state's total tax collections. How did the state get to this point? Well, let's look at some telling statistics. Medicaid (medical assistance to those not able to pay) spending has increased 72.6 percent, from $8.4 billion to $14.5 billion, from fiscal year 2001 to FY 2009. State employee health insurance spending has increased 92.9 percent, from $1.1 billion to $2.1 billion, in the past 10 years. The state has issued long-term

bonds for construction and pension payments that will cost taxpayers $22.7 billion in interest alone. In fiscal 2003 and fiscal 2010, the state borrowed a combined $13.5 billion to make the pension payments in those respective years. To top off the spending increases,

the state has seen drastic declines in tax collections. The state income tax, one of the largest revenue sources for the state, has seen a decrease in revenue of 5.1 percent over the past 10 years. If you are thinking this is a "perfect storm," you are correct — increased spending and decreasing revenue. So what are the answers? There are

many "options" being publicly discussed. Some say the state should continue to cut spending. But what programs should be cut? In agriculture alone, there are numerous programs that rely on state funding. Programs that provide basic services, such as meat and poultry inspectors so our livestock can be processed, the grain warehouse programs that perform inspections to make sure grain is secure, weights and measures standards that ensure scales are correct, fertilizer and pesticide applicator testing programs so we can get our licenses to apply our inputs, and many more. Then there are other programs such as Soil and Water Conservation Districts, University of Ilinois Extension, county fairs, ag education, and AgrAbility Unlimited. Where should the cuts be made? Others state that taxes need to be increased to address the fiscal crisis. Which taxes could be increased? See Intersection, page V4

MAPPING IT OUT Should the Illinois Farm Bureau support increased cuts in state program funding? If so, what programs should be cut and to what levels? Should policy support changes in the way state pension systems provide retirement benefits to state employees and teachers? Should the Illinois Constitution be amended to remove the current guarantees for benefits currently earned by state employees and teachers? Are there acceptable tax increases or tax expansions? If so, which ones and to what levels? Should policy be open to a "graduated state income tax?" Is there a need for increasing the state motor fuel tax or should the current gallon tax be changed to a mileage tax? Should users of specific programs or individuals seeking state permits see fee increases?


FarmWeek Page V-2 Monday, August 2, 2010

Light at the end of the tunnel? Nuisance suits add uncertainty to Illinois livestock development

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here are many cases in Illinois in which livestock farmers have indicated their intent to construct a new livestock facility, have received the “green light” from the Illinois Department of Agriculture and have started construction, only to be sued by neighbors prior to completion of construction. The basis of these citizen lawsuits is the premise that these livestock facilities, even though they are not yet populated with livestock, will be a nuisance. Just because someone may believe an event which may result in a nuisance may occur doesn’t mean that this event will occur. It can be compared to giving one a speeding ticket just because you “may” drive over the speed limit some day. Yet, Illinois courts have enjoined the operation of such facilities because of the anticipatory nuisance theory. When a court enjoins operation of a livestock facility which has not been completed, it essentially forces livestock farmers to halt construction of the facility until the entire legal proceeding — which includes the

appeals process — is resolved. Thus, farmers lose income because they cannot operate their business, they may incur increased construction costs, and they have to pay attorneys’ fees and court costs to defend themselves in the lawsuit. Bills which limit a person’s ability to file lawsuits against proposed facilities that have complied with applicable permitting laws yet, have been submitted in the Illinois legislature but have had a difficult time moving forward. The primary reason is that lawyers’ interest groups and anti-livestock groups do not want to see legislation that limits a person’s right to sue. Most recently, HB 6142 was introduced and sought to pre-empt anticipatory nuisance suits against owners of proposed livestock facilities or expansions to existing facilities that are in compliance with the Livestock Management Facilities Act and other applicable laws. This bill also seeks to allow a successful defendant to receive payment from the plaintiff(s) for costs and reasonable attorney fees in the case of any nuisance action against a farm.

MAPPING IT OUT IFB policy supports legislation that prohibits the filing of lawsuits against farmers who have complied with all applicable laws. Are there other means to pursue that would help us achieve a similar goal? What are some creative ways we can employ to allow for the expansion of the livestock industry in our state and yet reduce the threat of lawsuits for a new or expanding facility? Would an “early intervention team,” which would inform neighbors early on of plans to construct livestock facilities, help a producer or hurt?

Unfortunately, this bill is being held in committee and will not move forward this year due to strong opposition. Historically, lawsuits filed against farmers are generally few and infrequent, but several lawsuits have been filed against livestock farmers in the last few years. Many of the farmers who were sued eventually prevailed in such lawsuits but at great expense, including lost profits, attorney fees, and court costs. Each farmer who prevails sends a strong message to citizen groups that this is a losing battle. It is a weak legal argument, it reinforces Illinois livestock farmers’ excellent track record in stewardship, and it continues to build strong case law for agriculture — helping to pave the way for others. We should be proud of the producers who have had the tenacity to fight and prevail in these cases. It also sends a strong message to persons interested in growing agriculture that the system “works.” There is concern that any litigation sends a negative message to those interested in expanding or starting a new facility. Has this had an impact on Illinois and stymied our growth? That is a difficult question to answer and is predicated on many other issues

too numerous to mention in this article. One thing that is certain: Illinois is not alone in dealing with persons who wish to live in the country but not near a livestock operation. Other states, including Michigan and Indiana, have reported numerous citizen lawsuits similar to what we have experienced here in Illinois. The Resolutions Committee is interested in finding innovative solutions to this vexing problem. The answers certainly will not come easy. Prior attempts to seek legislative solutions have been turned back. Lawsuits are expensive for livestock farmers to defend and some cannot afford the legal battle.

Crosscurrents: Wind power generates diverse views

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he production of electricity in Illinois comes primarily from coal and nuclear power. Renewable energy accounts for nearly 1 percent of electricity generation in Illinois. Illinois ranks 16th in the list of U.S. states with wind energy potential but is currently in the top 10 states for installed wind energy. As of July 2010, Illinois had 21 wind projects actively producing energy, which account for 1,847 megawatts (MW) of electricity. According to wind industry experts, Illinois has the potential to eventually install up to 15,000 MW of wind generation. At an average capacity of 1.8 MW per wind turbine, that would be approximately 7,300 additional turbines statewide. Full development of that potential will depend on a number of key factors such as public policy and the price of electricity. The largest wind operation in Illinois is Twin Groves Wind Farm I and II, located in McLean County, with a combined capacity of 396 MW. The developer, Horizon Energy, plans to expand

this wind farm with an additional 500 MW, which would make it the largest wind farm in the United States. In 2007, the Illinois General Assembly passed legislation mandating that 25 percent of electricity be produced from renewable energy by 2025. This means 7,500 to 8,000 MW of renewable energy must be generated and 75 percent of it must come from wind energy. Therefore, in order to meet that goal in 16 years, the state must install at least 4,453 additional MW of wind energy. Today, there are approximately 6,500 MW of wind development under some stage of development in Illinois. The process of developing a wind farm may span several years. County siting and permitting requirements must be met. A special use permit is required in most counties with zoning. Wind ordinances developed by county governments vary in length and complexity. They address such things as design and installation, setback requirements, use of public roads, operation, noise levels, etc. Some require environmental studies and agency approvals prior to granting

a permit to construct. The development process is comprised of several steps: The wind energy developer finds a location with sufficient wind resources using meteorological test towers. If the site looks promising, the developer makes contact with landowners as well as local government officials. During this period, a check of existing transmission lines is necessary to confirm that there is adequate capacity to move the electricity generated by the wind farm onto the transmission grid. If the interest in the location is maintained, the developer engages in negotiations with landowners to lease their land for siting wind turbines, access

roads, power lines, and substations. The developer can then draft the site plan. Negotiations with landowners for the payment of the lease are finalized while studies such as road construction and environmental impacts are conducted. If the project overcomes all of these hurdles and is approved by the county board, construction begins. Many people view wind energy as good for the environment, job creation, energy independence, and rural economic development. Once they are constructed, wind turbines generate electricity without emitting greenhouse gases and requiring little water. See Wind, page V4

MAPPING IT OUT What are the most important issues regarding wind energy in your county? Where should county Farm Bureau education efforts be focused? If you have existing commercial wind energy systems in your county, what are the positive and negative aspects regarding those systems?


Page V-3 Monday, August 2, 2010 FarmWeek

Directional indicators How can producers steer their image and industry?

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n recent years, farming has been under attack from several quarters. Negative portrayals of farming have appeared in magazines, negative documentaries have been released, and best-selling books have been written that are very critical of our entire food production system. Activist groups have been fueling these attacks by releasing undercover videos, protesting against farming practices, and offering up legislation or ballot initiatives that severely restrict farm practices. The result has been an erosion of consumer confidence in farming and damage to the vital interests of farmers. Programs are being conducted in several states to combat these attacks. New coalitions have formed among major commodity groups and farm organizations to communicate the benefits of modern agriculture to consumers. Specialized firms such as the Center for Food Integrity are working to bring ag and food groups together to present a unified and accurate message. In Illinois, efforts are under way to communicate with consumers via social media, train farmers to speak to community groups about livestock production, and communicate with the food industry regarding the value and purpose of farm practices. The Illinois Beef Association, Illinois Corn Growers Association, Illinois Farm Bureau, Illinois Soybean Association, and Illinois Pork Producers Association have joined forces to launch a Farmer Image Campaign. This campaign is designed to determine consumers' attitudes about farming and develop messages that will update the image of the farmer. The Farmer Image Campaign will soon be releasing ideas on how farmers and farm organizations can use these messages to better connect with consumers. While these efforts are under way, numerous ideas to improve the image of agriculture continue to sur-

face. One idea is to create a national, wide-reaching non-profit organization led by farm organizations, industry representatives, members of academia, and interested consumers. This organization would be different from Farm Bureau or other ag organizations because if wouldn’t represent the interests of mainstream consumers, as well as farmers and the food industry. The group's goal would be to become a respected source of mainstream, accurate information on numerous food and agricultural issues. The organiza-

tion would work to combat the negative attacks that come from activists and uniformed critics. Having a non-profit organization that includes consumers among its membership could provide unique benefits. Tapping even a small percentage of the consuming public could mean millions of members. It also would mean a significant pool of resources that could be used to combat activist groups. A non-profit

MAPPING IT OUT Should IFB be a part of an effort to start a national non-profit organization that would represent the interests of consumers and the agricultural industry? In what ways could current state and national efforts be coordinated to connect with consumers? Are there other innovative methods of reaching consumers that IFB should employ?

THE CROSSING PATROL This FarmWeek supplement aims to spark local discussion of integral issues. Members are encouraged to contact their county Farm Bureau to provide input into policy development (to view Farm Bureau policy, visit {www.ilfb.org} and click on ‘‘Inside IFB/IFB Policy and Development’’). Each county Farm Bureau will review member input and send policy proposals to the Illinois Farm Bureau Resolutions Committee for consideration by voting delegates at the December IFB annual meeting.

organization such as this also would have the advantage of representing members along the entire food value chain. This diverse representation would add credibility to the organization, improving its impact on the media and with food companies. There also would be significant challenges to starting a national non-profit organization. A large number of resources would be needed to start the coalition and develop new relationships with industry partners and consumers. The recruitment of consumer members would be need to be an aggressive and ongoing endeavor. The leadership of the organization would be representative of its membership and not completely driven by farmers, leading to potential situations where this organization's policies don't match with our own. These challenges require careful consideration and planning for the organization to be successful at improving the image of agriculture. State and national efforts are important to help improve the image of agriculture. Developing messages that help consumers connect with agriculture can help erode the credibility of activist groups. Having national and state efforts allow groups to reach consumers with general messages or those specifically targeted to consumers in a certain region. Having a national non-profit organization representing farmers and consumers could provide the membership size and resources needed to directly combat national activist groups. However, these efforts take a significant investment of time and money. Starting a national non-profit organization would require a large number of financial resources as the initial coalition is built. Reaching consumers with well-crafted messages means purchasing advertising. Providing opportunities for farmers to interact directly with consumers could be implemented, but farmers would need to be committed to participate. Using social media as an avenue to reach consumers can be cost effective but requires technical skill and substantial time to deliver information effectively. The image of farmers has been attacked more vigorously during the last few years. Many state and national ag organizations have stepped up and developed programs to respond to these criticisms. With these activities taking place and more ideas surfacing, what are the most effective ways for IFB to improve the image of agriculture?

The 2010 IFB Resolutions Committee

Here are this year’s Resolutions Committee members: District 1: Paul Rasmussen (DeKalb County) District 2: Brian Duncan (Ogle) District 3: Phil Fuhr (Rock Island) District 4: Robert Sharkey (Bureau) District 5: Steve Kodat (Grundy) District 6: Randy Poskin (Ford-Iroquois) District 7: Wayne Blunier (Woodford) District 8: Milton Smith (Peoria) District 9: Terry Rush (Pike) District 10: Robert Pharis (Logan) District 11: Gary Towler (Christian) District 12: David Sadler (Vermilion) District 13: Joe Bierman (Jasper) District 14: Ken Cripe (Fayette) District 15: Edward Marburger (Macoupin)

District 16: Ray Krausz (Clinton) District 17: Kent Darnell (Hamilton) District 18: Lewis Hollis (Johnson) ACTION Team: Greg Leigh (Fulton) Young Leader: Alan Chesnut (Vermilion) Board of Directors Mike Kenyon Richard Ochs Troy Uphoff Chairman Richard Guebert Jr.


FarmWeek Page V-4 Monday, August 2, 2010

Cross purposes? Transportation, maintenance priorities sometimes collide

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oad access and maintenance interests often conflict where weight limits are involved. Illinois' farm families rely daily on personal and business access to and from their farms and homes via a serviceable rural road system. The vast majority of local road officials share that interest as they maintain the 87,000-plus miles of road district roads and the 17,000-plus miles of county roads in Illinois. Within that mix, somewhat counterintuitively, weight limits are employed to maintain access by restricting it. The law of supply and demand creates the need. Farming requires major movements of inputs and commodities. In fact, in 2007, agriculture accounted for 31 percent of the nation's freight ton-miles hauled. For Illinois farmers, that means lots of trucks; and in recent years, reliance on larger trucks. Livestock farmers often are dependant on year-round truck access for delivery of animal feed, heating fuel, and feeder stock and for the routine shipment of manure, market animals, and animal products. Grain farmers sometimes need frequent truck access, too, but often have more available timing options. The laws of nature created the problem. Most road district roads — and some at the county level — simply evolved from a wide dirt lane. Some were covered with an oil-andchip surface. Others were graveled. But in neither case were they "engineered" to withstand dramatic changes in the soils that make up their sub-base. The underlying soils can turn to soft mud each spring when the winter frost thaws from the ground. That can leave the overlying pavement (or graveled surface) vulnerable and soft enough to be damaged because of another natural

law: gravity. The laws of man create the power. Illinois road officials have authority — when warranted — to limit vehicle

weights on their roads. Weight limit postings may be permanent (yearround) if the road would be unduly damaged by repeated heavy loadings. Roads may also be posted on a temporary basis for up to 90 days each calendar year for any weather-related reason. Typically, that's the spring thaw period. Often, these spring postings impose the most dramatic limitations, but they can differ widely. Some are as low as five tons of gross weight. Thankfully, most are more reasonable, often ranging from 10 tons to 25 tons of gross weight. A few are

set using what some consider to be a more sound engineering approach for pavement protection, a tons-per-axle basis (or a gross weight basis that varies by the number of axles on the vehicle.) The laws of survival create the conflict. Where road weight limits have been a long-term, annual routine, farmers often have adjusted by limiting their operations in terms of size and/or timing. Operating in that situation is often challenging but manageable. But where farm operations have been built around the experience and expectation of year-round heavy truck access, an abrupt restriction imposed by a new weight limit posting can be potentially devastating. Significant investment in the farm and its operational integrity can be rendered virtually useless by such a change. The law of averages creates winners and some losers. Many times, road officials and local trucking interests—including farmers—can work together to find windows of opportunity to ship loads in or out during the spring thaw. It requires good will between the parties and a cooperative weather pat-

tern. Even then, lowered volumes and inopportune timing remain as issues. Since a truck's empty weight can't be appreciably reduced, weight limit postings force drastic reductions in cargo. In extreme cases, even empty (large) trucks cannot be moved. Such onerous weight limits can create an intolerable situation for a farmer, especially a livestock farmer faced with feed input needs or animals ready to market. It would very likely increase production costs, limit market options, and negatively impact profits. Ultimately, it could force the shutdown of the farming operation in that location. But, without weight limit postings during the spring thaw, most of Illinois' rural local roads would be vulnerable to serious damage from heavy trucks. A single trip by a heavy vehicle can be enough to destroy a thin oil and chip pavement without an "engineered" base. Repeated loadings could cut ruts and pulverize established pavements leaving reduced capacity and unsafe conditions. Local taxpayers would then either be stuck with the tab for repairs or would have to live with the damaged pavement as a part of their everyday experience.

MAPPING IT OUT What options should farmers have regarding road weight limit postings? How much do road postings affect farm operations financially? Provide an instance in which a road posting financially affected your own farm — include estimated dollars and time lost. What opportunities should there be to provide input regarding a road commissioner's authority on weight limits? How might arbitration work as a means for affected farmers to get access to transportation, and under what conditions (i.e., degree of limitation, make-up of arbitration board, etc.)?

Wind Continued from page 2 The turbines provide significant property tax revenue and are a source of revenue for the landowners who have turbines on their property. The construction and maintenance of the turbines can produce local jobs which

contribute to the local economy. As with any major new project of such scope, there are issues to consider. Are units of local government prepared to properly address and enforce complex and sometimes controversial issues that need to be

Intersection Continued from page 1 Should the income tax be increased and if so by how much? For every 1 percent of personal income, the state would generate approximately $2.8 billion. Should the state sales tax rate be increased or should it be expanded to the service industry? Economic indicators show that the largest growing sector in Illinois is the service industry. Or what about bringing streamlined sales tax practices to Illinois and taxing internet sales? Should other taxes be increased such as utility taxes, cigarette taxes, or others? Then there are the roads -- those terrible pot holes and lack of market roads for agricultural crops. But to fix these, road jurisdictions need more funds. Should the motor fuel tax rate be increased or should the state switch to a vehicle use tax based on the number of miles a person drives? There is no easy answer to the state's fiscal crisis. It is going to take great fortitude and a lot of hard choices.

spelled out in a wind ordinance? For landowners, will the compensation from the wind farm be sufficient to offset the disruption to their farming operation, both now and long term? The wind energy contract that landowners sign for a turbine on their property are typically 30 years or longer and are quite complex and lengthy. This often follows a short-term option agreement which may be a somewhat simple document followed by the more long-term easement or lease. These easement agreements include granting the wind energy company access to your land both during and after construction. The massive size of the wind turbine makes it a long-term commitment to your land because turbines are not easily removed. With much of Illinois being comprised of agricultural land, turbines are typically placed within crop production areas, thus having the potential to disrupt some agricultural practices.

Roads often are constructed across farm fields to access turbine sites. Soil compaction and damage to drainage systems must be properly addressed. Long-term issues, such as turbine deconstruction, must be carefully and fully spelled out in easement contracts. Pesticide application (both ground and aerial) will require more pre-planning to avoid the application of crop protection products when turbine maintenance workers are present. Pesticide exposure to workers is an important factor to consider because it may create additional liability for the landowner. The ability to secure aerial application services may be limited. The presence of wind turbines on one farm has the potential to limit aerial services on a neighboring farm that does not have a turbine. Given all these factors that can impact your farm, Farm Bureau is working to provide information and education about wind energy. We welcome your ideas and input.

ARTICLES FOR THIS SUPPLEMENT WERE PREPARED BY ILLINOIS FARM BUREAU STAFF MEMBERS KEVIN SEMLOW, JIM FRALEY, RAE PAYNE, BILL BODINE, AND KEVIN RUND

Policy supplement 2010  

Policy supplement August 2010

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