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Winter 2020 Kansas Agribusiness Retailers Association 816 SW Tyler Topeka, KS 66612 (785) 234-0463 ksagretailers.org ASSOCIATION STAFF Ron Seeber President & CEO Randy Stookey Senior Vice President General Counsel Staci Storey Senior Vice President Chief Financial Officer Shari Bennett Vice President Event Planning Samantha Tenpenny Director of Member Services Lisa Anschutz Senior Director of Internal Operations Trae Green Associate Vice President Sidney Storey Administrative Assistant BOARD OF DIRECTORS Lance Nelson Chairman Dustin Kuntz Vice Chairman Kevin Dieckmann 2nd Vice Chairman Clark Pearson Immediate Past Chairman Gary Beachner Bryan Bucl Troy Coon Yance Farney Justin Foss Bryan French Bill Garner Tim Giesick Jim Grilliot

Jeff Holling Rachel Hurley Brian Laverentz Jami Loecker Kevin Mears Scott Morris O.J. Pearl Dave Spears Mark Wegner

Editors: KARA staff Photos: Cover (iStock.com/

Kansas Agribusiness Retailers Association (KARA) and Kansas Grain and Feed Association (KGFA) board of directors officers annually fly out to Washington, D.C., to meet in a small group setting with the Kansas congressional delegation. From left, KARA president and CEO Ron Seeber, KARA vice chairman Dustin Kuntz, Congressman Ron Estes, KGFA chairwoman Deb Miller, KGFA second vice chairman Brent Emch, Farm Journal vice president Doug Catt and KARA chairman Lance Nelson.

TABLE OF

CONTENTS 03 PRESIDENT’S LETTER Officers march Capitol Hill and meet with Congressional Delegation

14 HOMELAND SECURITY ANTITERRORISM If your company has chemicals that should be reported, please see how to do so

04 INDUSTRY NEWS Updates on state, federal and industry news affecting your business

18 23rd TAL CLASS COMPLETES SESSION I The 23rd class of Tomorrow’s Agribusiness Leaders completed their first session in January

07 KANSAS DEPT. OF AG NEWS KDA to host regional agribusiness workshops in March

08 KANSAS CAPITOL REVIEW A look at what’s happened during the 2020 Kansas Legislature since the session began in January.

17 2020 LEGISLATIVE ACTION DAY Despite the threat of severe inclement weather in Topeka, members showed up and advocated for agribusiness.

andreaskrappweis); The Kansas Agribusiness Update is published quarterly for the members, friends and affiliates of the Kansas Agribusiness Retailers Association. Email contributions to: Trae Green, trae@kansasag.org. Annual subscriptions for members can be purchased for $25.00. © 2020 KARA. Read this newsletter online at www.ksagretailers.org/printnewsletters. Advertising does not influence editorial decisions or content. KARA reserves the right to refuse, reject, or cancel any ad for any reason at any time without liability.

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Agribusiness Update


SAFE AND ABUNDANT FOOD THROUGH SOUND SCIENCE

PRESIDENT’SMESSAGE RONALD SEEBER

President and CEO

Ronald Seeber became the second president and CEO in the nearly 40-year history of Kansas Agribusiness Retailers Association in 2017. Seeber has more than 30 years of association management and government affairs experience working in Washington, D.C., and his home state of Kansas. PHONE 785.234.0461 785.224.1848

ADDRESS 816 SW Tyler Street Topeka, KS 66612

EMAIL ron@kansasag.org

DEAR KARA

MEMBERS

Our message was clear to our members of Congress. The power of the federal government can make or break our industry.

My first job out of college was as a hill staffer in Washington, D.C., in the early 1990s. A lot has changed since then, but one thing has remained the same, overworked and underpaid 25 year olds run our country. I was reminded of this in February when KARA’s Chairman Lance Nelson and Vice Chairman Dustin Kuntz, Kansas Grain and Feed Association’s Chairwoman Deb Miller and Second Vice Chairman Brent Emch traveled with me to our nation’s capital to meet with our congressional delegation where we shared the concerns facing our industry. We spent one full day traveling to each of their House and Senate offices and believe me, they got an earful. While we met with our elected officials, their young worker bees kept a transcript of everything we said, as we said it, to make sure our issues were followed up on. We started by thanking them for their support of the passage of the United States Mexico Canada Agreement (USMCA), or otherwise known as NAFTA 2.0. We reminded them that by putting partisan politics aside the United States and Kansas are open for business to the world and that everyone gains. While we had their ear, we also urged them to try and maintain an attitude of regulatory certainty and stability. We explained by knowing what to expect from our government, we and our customers are better prepared to plan for the upcoming growing year and know the rules won’t be changed midway through the game. We shared stories from our customers about their difficulties to find viable lending options and how they are seeing a tightening of credit in rural Kansas. We reminded them that while the rest of the country has a vibrant economy, rural Kansas still struggles

and finds itself the sharp tip of the spear on trade disputes. We also let them know of the workforce shortages – particularly CDL drivers, and the exodus of young people leaving home and not returning is very real. As you can see, our message was clear to our members of Congress that the power of the federal government can make or break our industry. We used the example of the importance of a one-year federal intervention reprieve with regard to the Quivira National Wildlife Refuge. How one decision to hold off for just one planting season cooled boiling tempers and gave a little more time to find a viable solution. We reminded our leaders that actions or inactions have consequences – good and bad. While we enjoyed face time with our elected officials, we followed up with their staff later at an industry hosted reception where our 25 year old staffers recited their notes verbatim and enjoyed a dinner of egg rolls, bite-size pigs in a blanket and beer. I firmly believe that it is just as important to maintain a relationship with these young worker bees as their member of Congress bosses. Keep in mind that these young folks actually get the work accomplished and their bosses get the headlines. Sincerely,

Winter 2020

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KANSAS AGRIBUSINESS RETAILERS ASSOCIATION

INDUSTRYnews Feature Focus: myPPE Hazard Assessment Program

If at any time the scope of assessment is changed (i.e. worksite to individual), the previous data is removed and the assessment must be completed again in its entirety. Be cautious when changing the scope.

The myPPE Personal Protective Equipment (PPE) Hazard Assessment Program is a comprehensive solution for managing and tracking your PPE program that orginally debuted in 2012. OSHA developed regulations regarding PPE to ensure employees are adequately protected while on the job. Employers must periodically assess the hazards that are present and could pose harm to their employees. For each task, the employer needs to choose personal protective gear that will properly protect the employee from the hazards identified in the hazard assessment. The myPPE Hazard Assessment tool helps define, organize and document the personal protective equipment required for an individual, category of employees or worksite. This unique tool leads you through

the process of identifying hazards, selecting the appropriate PPE and documenting the exercise. Once completed, your Hazard Assessment will populate as Snapshots updates hourly, creating an electronic copy for easy access and for periodic review and updates. In addition to the electronic copy, the person completing the assessment should print off and sign the file copy and file in the facility’s Compliance Filing System binder. NOTE: If at any time the scope of assessment is changed (i.e. worksite to individual), the previous data is removed and the assessment must be completed again in its entirety. Be cautious when changing the scope. Source: Asmark Institute

Navigable Waters Protection Rule - A New Definition of WOTUS EPA and the Department of the Army finalized the Navigable Waters Protection Rule to define “Waters of the United States” and establish federal regulatory authority under the Clean Water Act. Congress, in the Clean Water Act, directed the Agencies to protect “navigable waters.” The Navigable Waters Protection Rule regulates these waters and the core 4

Agribusiness Update

tributary systems that provide perennial or intermittent flow into them. The revised definition identifies four clear categories of waters that are federally regulated under the Clean Water Act: the territorial seas and traditional navigable waters; perennial and intermittent tributaries; certain lakes, ponds, and impoundments; and wetlands that are adjacent to

jurisdictional waters. The final rule also details 12 categories of exclusions, features that are not “Waters of the United States,” such as features that only contain water in direct response to rainfall, groundwater, many ditches, prior converted cropland, and waste treatment systems.

The Navigable Waters Protection Rule adds muchneeded clarity to WOTUS for agricultural retailers and their farmer customers.


SAFE AND ABUNDANT FOOD THROUGH SOUND SCIENCE

INDUSTRYnews 2020 Outlooks for DOT, EPA and OSHA DOT, EPA and OSHA have all published regulatory agendas with target dates through the end of the fiscal year. We have reviewed the lists and identified upcoming regulatory and deregulatory actions that could impact our clients. All in all, there are plenty of proposals on the horizon for 2020.

Occupational Safety & Health Administration Technical Corrections to 27 OSHA Standards and Regulations Lock-Out/Tag-Out Update Powered Industrial Trucks Design Standard Update Update to the Hazard Communication Standard Walking Working Surfaces

12/2019 12/2019 1/2020 1/2020 4/2020

Final Rule Pre-proposal Proposal Proposal Proposal

Department of Transportation Record of Violations 11/2019 Proposal Fees for the Unified Carrier Registration Plan and Agreement 12/2019 Final Rule Rulemaking Procedures Update 12/2019 Final Rule Controlled Substances and Alcohol Testing: State Driver’s Licensing Agency Downgrade of Commercial Driver’s License 1/2020 Proposal Driver Qualifications; Revising the Vision Standard 1/2020 Proposal Extension of Compliance Date for Entry Level Driver Training 1/2020 Interim Final Rule Extension of Compliance Date for States’ Query of the Drug and Alcohol Clearinghouse 1/2020 Proposal Hazardous Materials: Modal Regulatory Reform Initiatives 3/2020 Proposal Preservation of Records 4/2020 Proposal Hazardous Materials Safety Permits 2020; NA Standard Out-of-Service Criteria 6/2020 Proposal Hazardous Materials: Adoption of Miscellaneous Petitions to Reduce Regulatory Burdens 8/2020 Final Rule Hazardous Materials: Petition to Reduce Regulatory Burden for Cylinder Requalification Requirements 8/2020 Final Rule General Technical Amendments 9/2020 Proposal Hours of Service of Drivers TBD Final Rule

Environmental Protection Agency Risk Management Programs Under the Clean Air Act: Reconsideration of Amendments 11/2019 Final Rule Adding Aerosol Cans to the Universal Waste Regulations 11/2019 Final Rule Revised Definition of “Waters of the United States” (Step 2) 1/2020 Final Rule Worker Protection Standard; Revision of the Application Exclusion Zone Requirements 1/2020 Proposal Pesticides: Modification to the Minimum Risk Pesticide Listing Program 2/2020 Pre-proposal Modernizing Ignitable Liquids Determinations 3/2020 Final Rule Pesticides: Administrative Corrections and Removal of Obsolete Information 3/2020 Proposal Expansion of Crop Grouping Program 4/2020 Proposal Microorganisms: General Exemptions from Reporting Requirements 5/2020 Proposal Control of Air Pollution from New Motor Vehicles: Heavy-Duty Engine Standards 6/2020 Proposal Financial Responsibility Requirements Under CERCLA Section 108(b) for the Chemical Manufacturing Industry 12/2022 Proposal Source: Asmark Institute

OSHA Form 300A Deadlines It’s time to complete your 2019 injury and illness recordkeeping obligations by posting the Summary of Work-Related Injuries and Illnesses (OSHA Form 300A). OSHA requires that the notice be displayed from February 1st to April 30th of each year in a conspicuous place where employee notices are customarily posted. Businesses with no injuries or illnesses for the year must still post the form. A company official must certify the information in Form 300A was examined and is believed to be correct and complete. All establishments with 250 or more employees in industries covered by the

recordkeeping regulation must electronically submit Form 300A no later than March 2nd, as well as establishments between 20-249 employees in certain industries, including “warehousing and storage.” Covered employers must now provide their Employer Identification Number (EIN). OSHA began accepting submissions on January 2, 2020. Source: Asmark Institute

Photo courtesy: Flickr.com/NCinDC

Covered employers must now provide their Employer Identification Number (EIN). OSHA began accepting submissions on January 2, 2020.

Winter 2020

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SAFE AND ABUNDANT FOOD THROUGH SOUND SCIENCE

KDA to Host Regional Agribusiness Development Workshops in March

The Kansas Department of Agriculture will host four Regional Agribusiness Development Workshops in March 2020 to provide Kansas rural communities with resources and current business development and organizational contacts to assist with recruiting, retaining, and growing ag businesses in their communities. will run from 6:00 p.m. to 8:00 p.m., and will include a meal. There is no charge to attend, but registration is required to ensure sufficient food and materials. Find out more information and register at agriculture. ks.gov/BusinessDevelopment. The KDA Division of Agriculture Marketing received a U.S. Department of Agriculture Rural Business Development Grant to help fund these statewide workshops. Established in the 2014 Farm Bill, USDA’s Rural Business Development Grant is a program intended to help with technical assistance, training and other activities to allow small businesses in rural areas to expand. KDA is committed to providing an environment that enhances and encourages economic growth of the agriculture industry and the Kansas economy. These workshops will provide support and assistance to help make Kansas rural communities more successful.

MIKE BEAM Kansas Secretary of Agriculture

Workshops will be held in the following locations: • Wednesday, March 4 — Colby Community College Student Union, Colby • Wednesday, March 11 — Municipal Building, Parsons • Wednesday, March 18 — Stockgrowers State Bank, Ashland • Wednesday, March 25 — Kansas Department of Agriculture building, Manhattan “Economic development in Kansas is tied to agriculture, which makes up $47 billion of the state’s economy,” said Kansas Secretary of Agriculture Mike Beam. “These workshops will help communities consider the unique needs associated with agricultural opportunities in Kansas which will create an environment that facilitates growth.” Beam added that expanding resources and education will make Kansas’ rural communities better prepared to serve as economic engines for rural Kansas. Featured speakers at the events will represent the Kansas Department of Agriculture, Kansas Department of Commerce, and local economic development organizations. The workshops

Economic development in Kansas is tied to agriculture, which makes up $47 billion of the state’s economy. These workshops will help communities consider the unique needs

associated

with

agricultural

opportunities in Kansas which will create an environment that facilitates growth.

Winter 2020

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KANSAS AGRIBUSINESS RETAILERS ASSOCIATION

Capitol

REVIEW

By: Randy Stookey

Heading into the 2020 Kansas legislative session, much activity and attention was focused on such things as approving the next 10year highway plan, property tax reform, adding a tax on internet sales, Medicaid expansion and social issues. Tax increases in 2017 increased State General Fund receipts, which are now projected to be $1.2 billion above receipts in 2018. As tax receipts have increased, the state budget has also increased, with the legislature passing the largest ever budget last year at $7.85 billion. 8

Agribusiness Update


SAFE AND ABUNDANT FOOD THROUGH SOUND SCIENCE

Governor Kelly Sets Forth Her Priorities In her State of the State address, Governor Kelly presented her priorities for the year which included, inter alia, the passage of Medicaid expansion, the next 10-year transportation plan, passage of an internet sales tax, the lowering of food sales tax ($53 million proposal), and addressing high property taxes. In order to pay for these budget priorities, the Governor has once again proposed reamortization of the state’s pension plan (Kansas Public Employee Retirement System, or “KPERS”) – a move which would free up approximately $130 million for the annual budget, but would cost taxpayers approximately $4.4 billion in additional long-term interest payments. Republican leadership in the House and Senate have already stated their objections to this proposal. Don’t Look Too Far Down the Road Due to significant tax increases in 2017, receipts to the State General Fund are projected to be $1.2 billion over receipts in 2018, and $550 million ahead of

projections for the end of the current fiscal year. However, even with this increased tax revenue, budget projections are once again in the red again in just two years. This is due, in large part, to hefty mandatory payments to KPERS, budgeted spending increases on K-12 education, increased spending on healthcare and social services and the movement away from borrowing from the state transportation fund. Going forward, the legislature will need to either make significant budget cuts or raise taxes to cover the shortfall.

transportation infrastructure; the need for a larger labor force; and more adequate housing in rural areas.

Kansas House Leadership Rolls Out “Make Kansas Work” Plan House leadership outlined a “Make Kansas Work” plan that is intended to benefit rural economies, health care, encourage homeownership, and boosts to $100,000 the tax floor for Social Security recipients. Bills will be introduced shortly on this five point plan, including: 1. Rural Hospital Innovation Act: $30 million Lieutenant Governor Briefs Committee in grants to 100 counties of the 105 counties on 2019 Rural Prosperity Listening Tour to respond to health-care needs. The Senate Committee on Agriculture 2. A first-time homebuyer savings account: received a presentation from Lieutenant allows tax-deductible contributions by Governor Lynn Rogers on his 2019 Rural parents and grandparents to savings Prosperity Listening Tour across Kansas. The accounts for their children to buy homes Lt. Governor stated that, during his tour, high in Kansas. The accounts could shelter from property taxes were the number one issue. taxes up to $24,000 per person or $48,000 Other issues stressed were: the importance of per couple. rural healthcare (30 percent of rural hospitals 3. Targeted Employment Act: allows business are financially insecure); the need for better to contract with integrated workshops where internet accessibility; the importance of rural people with disabilities who work alongside Continued on Page 12

Winter 2020

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INDUSTRYnews DOT Hits the Brakes on ELDT Rule The Department of Transportation (DOT) has issued an interim final rule amending the “Minimum Training Requirements for EntryLevel Commercial Motor Vehicle Operators” (ELDT final rule), by extending the compliance date for the rule from February 7, 2020, to February 7, 2022. This will provide DOT additional time to complete development of the Training Provider Registry. The registry will allow training providers to self-certify that they meet the training requirements and will provide the electronic interface that will receive and store entry-level driver training certification information from training

providers and transmit that information to the State Driver Licensing Agencies (SDLAs). The extension also provides SDLAs with time to modify their information technology systems and procedures, as necessary, to accommodate their receipt of driverspecific ELDT data. The 2-year extension applies to all requirements established in the ELDT final rule including the date by which drivers seeking a CDL or endorsement must complete the required training. Source: Asmark Institute

The extension also provides SDLAs with time to modify their information technology systems and procedures, as necessary, to accommodate their receipt of driverspecific ELDT data.

Extension of Compliance Date for Entry-Level Driver Training FMCSA is amending its December 8, 2016, final rule, “Minimum Training Requirements for Entry-Level Commercial Motor Vehicle Operators” (ELDT final rule), by extending the compliance date for the rule from February 7, 2020, to February 7, 2022. This action will provide FMCSA additional time to complete development of the Training

Provider Registry (TPR). The TPR will allow training providers to self-certify that they meet the training requirements and will provide the electronic interface that will receive and store entry-level driver training (ELDT) certification information from training providers and transmit that information to the State Driver Licensing Agencies (SDLAs). The extension also provides SDLAs with time

to modify their information technology (IT) systems and procedures, as necessary, to accommodate their receipt of driver-specific ELDT data from the TPR. FMCSA is delaying the entire ELDT final rule, as opposed to a partial delay as proposed, due to delays in implementation of the TPR that were not foreseen when the proposed rule was published.

Story courtesy Federal Motor Carrier Safety Administration. For questions, please contact Mr. Richard Clemente, Driver and Carrier Operations Division, Federal Motor Carrier Safety Administration, 1200 New Jersey Ave, SE., Washington, D.C., 205900001, (202) 366-4325, mcpsd@dot.gov.

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Agribusiness Update


SAFE AND ABUNDANT FOOD THROUGH SOUND SCIENCE

INDUSTRYnews EPA Finalizes Glyphosate Mitigation EPA has concluded its regulatory review of glyphosate—the most widely used herbicide in the United States. After a thorough review of the best available science, as required under the Federal Insecticide, Fungicide, and Rodenticide Act, EPA has concluded that there are no risks of concern to human health when glyphosate is used according to the label and that it is not a carcinogen. These findings on human health risk are consistent with the conclusions of science reviews by many other countries and other federal agencies, including the U.S. Department of Agriculture, the Canadian Pest Management Regulatory Agency, the Australian Pesticide and Veterinary Medicines Authority, the European Food Safety Authority, and the German Federal

Institute for Occupational Safety and Health. The agency is requiring additional mitigation measures to help farmers target pesticide sprays to the intended pest and reduce the problem of increasing glyphosate resistance in weeds. Glyphosate has been studied for decades and the agency reviewed thousands of studies since its registration. Glyphosate is used on more than 100 food crops, including glyphosate-resistant corn, soybean, cotton, canola, and sugar beet. It is the leading herbicide for the management of invasive and noxious weeds and is used to manage pastures, rangeland, rights of ways, forests, public land, and residential areas. In addition, glyphosate has low residual soil toxicity and helps retain no-till and low-till farming operations.

EPA uses interim decisions to finalize enforceable mitigation measures while conducting other longerterm assessments, such as an endangered species assessment. EPA will next complete a draft biological evaluation for glyphosate, which is anticipated for public comment in Fall 2020.

Photo Credit: Ryan Moehring / USFWS

KDA Announces Irrigation Technology Initiative The Kansas Department of Agriculture’s Division of Conservation is pleased to announce the availability of the FY 2020 Irrigation Technology Initiative. This initiative is designed to promote irrigation efficiency by providing cost-share assistance to landowners for automated soil moisture probes. Through the Irrigation Technology Initiative, $132,500 is available in cost-share funds to assist landowners with irrigation efficiency technology. The funds will be directed toward

areas of the state with a significant focus on water conservation: $75,000 of the initiative funds will be designated to applications in the Rattlesnake Creek priority areas, and the remaining initiative funds will be designated to land located within Water Conservation Areas approved by the KDA Division of Water Resources. Applications must be approved prior to the purchase of soil moisture probes, and the cost-share rate will be 70 percent. Eligible soil moisture probes can be leased or purchased

by the landowner and must be automated and capable of providing data to the landowner. Landowners can apply for the FY 2020 Irrigation Technology Initiative cost share through their local conservation districts. You can find a directory of conservation districts at agriculture.ks.gov/ ConservationDistricts. Applications will be accepted through March 6, 2020. KDA cannot guarantee adequate funds will be available to fund all eligible applications.

If you have questions regarding the FY 2020 Irrigation Technology Initiative, please contact Dave Jones at 785-564-6623 or David.Jones@ks.gov.

Winter 2020

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KANSAS AGRIBUSINESS RETAILERS ASSOCIATION

Capitol

REVIEW

Continued from Page 9

welfare recipients could receive a tax credit for those contracts. 4. Raising the current $75,000 exemption from state income tax to $100,000 for Social Security recipients in an effort to allow those Social Security recipients to continue working while avoiding state income taxes. 5. The “Kansas Promise Act”: offer scholarships to Kansans who complete certification or two-year job programs in high-need areas for skilled labor. Recipients would have to work part time or perform community service and commit to remaining in Kansas at least two years after certification/graduation. KDA Ag Marketing Division Transferred to Dept. of Commerce Committees are reviewing the Governor’s proposed budget for the Kansas Department of Commerce which would transfer $650,000 (6.5 FTE’s) from the Agricultural Marketing Division of the Kansas Dept. of Agriculture (KDA) to the Kansas Department of Commerce. This transfer represents 60 percent of the KDA’s Ag Marketing budget. KDA testified that these positions are currently unfilled, and that they will back fill two of the positions internally so the transfer will create a net loss of 4.5 positions within KDA’s Division of Ag Marketing. KDOC staff testified that the Ag Marketing Division will not be leaving KDA, but KDA would only lose those positions that are dedicated to agricultural business development. Corporate Taxation Last year, Governor Kelly vetoed Senate Bill 22 related to corporate income tax. The bill would have exempted certain types of foreign corporate income (repatriated income and GILTI) that is now taxable at the state level following passage of the federal tax cuts and jobs at the end of 2017. New legislation (House Bill 2553) on this issue has been introduced this session, but Governor Kelly has openly stated that she is not in favor of corporate income tax legislation at this time. Property Tax Focus Increased commercial and residential 12

Agribusiness Update

property taxes across the state have resulted in dozens of bills on the issue being filed, and heard, in the House and Senate Tax Committees. Your association participated in stakeholder discussions over the summer which resulted in the introduction of many of those bills. We will testify in support of these measures, and will support additional legislation intended to strengthen the rights of Kansas property tax payers. Property Tax -- Escrow of Increase in Valuation When Appealed Last session, House Bill 2340 was passed out of the House Committee on Taxation. This bill would prohibit county treasurers from distributing the portion of property taxes that are in dispute for certain residential and commercial property (above a certain threshold), when the property tax is paid under protest, until the appeal process is final. Your association lobbied in support of the bill last year, and met with opponents of the bill over the summer interim to seek compromise language to amend the bill to address their concerns. Your association will continue to work toward the successful passage of this legislation.

Short Line Railroad’s Income Tax Credit Bill The House Tax Committee held a hearing on House Bill 2460, a bill which would provide for an income tax credit for qualified railroad track maintenance expenditures of short line railroads. Your association testified as a proponent if the bill were amended to extend the tax credit to owners/lessees of rail siding located on or adjacent to a Class II or Class III rail. Your association proposed an amendment to the bill and are working with stakeholders in passage of the bill. Net Operating Loss Carried Forward The House Committee on Taxation recommended that HB 2490 be passed out of committee and be placed on the Consent Calendar. The bill would extend the net operating loss carried forward period to 20 years beginning in tax year 2018. Currently, net operating losses can be carried forward for 10 years. Pesticide Waste Disposal Program Your association helped draft and introduce House Bill 2432 in the House Committee on Agriculture. The bill will amend the

Providing Kansas Agribusiness Professional Environmental Engineering Services since 1989

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SAFE AND ABUNDANT FOOD THROUGH SOUND SCIENCE

misdemeanors. Your association submitted testimony agreeing that a violation for failing to securely cover a load of grain would be more appropriately cited as a traffic infraction, and should not be cited as the (higher) category of a misdemeanor driving offense. The bill was intended to address the hauling of silage and ag commodities, but as drafted would, apply to all loads of all kinds, not just ag commodities. During the hearing, there was discussion about limiting the bill to just ag commodities, or just silage.

agricultural and specialty chemical remediation act (known as the ‘KARB’ program). The bill will allow up to $50,000 from the remediation fund each year to be used to fund a Pesticide Waste Disposal Program which will be managed by the Kansas Department of Agriculture. The bill was recently passed by the full House and awaits action in the Senate. Senate Utility Committee Receives Phase I of Electricity Rate Study Last session, following multiple hearings on the high cost of Kansas utility rates, the legislature passed Substitute for Senate Bill 69, a bill which required a comprehensive study of Kansas public electric rates, in order to assist the legislature in finding ways to lower rates and make Kansas more competitive. Members of the House and Senate Utilities Committees have received Phase One of the study, and are now considering actions to take in response to the study, such as Senate Bill 126. This bill would exempt certain public utilities from paying an income tax and require the savings to be passed to rate payers. Your association is closely following the issue and meeting with a coalition of industrial energy stakeholders. Kansas Attorney General Requests Introduction of “Public Litigation Coordination Act” Kansas Attorney General Derek Schmidt introduced House Bill 2461 in the House Committee on Judiciary that would require local units of government to coordinate with the Attorney General in order to enter into a contract for legal services on a contingency fee basis. The bill is intended to allow for the state to exercise greater control over

large suits such where the state – or local units of government – are the plaintiffs, rather than allowing each subordinate unit of government to enter into independent lawsuits. Your association testified in support of this legislation as good public policy for both the state and for industry. KDHE to Move Forward with Hazardous Chemical Spill Reporting Bill During the 2019 legislative session, the Kansas Department of Health and Environment (KDHE) introduced Senate Bill 153, which would allow the Secretary of Health and Environment the authority to define, in regulation, reportable quantities and timelines for reporting spills of hazardous chemicals, and to harmonize those quantities and timelines with federal standards. The bill directs the Secretary to create a one-call system for spill notification. In addition, however, the bill would have granted KDHE the authority to assess civil penalties for failing to timely report spills of hazardous chemicals. Your association opposed portions of the bill, and over the summer interim worked with KDHE on an agreed amendment to the bill. The amendment was adopted, and your association will support the bill moving forward. Unsecured Ag Silage Senator John Doll introduced Senate Bill 267, a bill which would clarify that a violation of a statute requiring secured vehicle loads would be a “traffic infraction” rather than a “class C misdemeanor”. The purpose of the bill is to ensure that drivers of unsecured loads of silage grain are cited with traffic infractions rather than class C

New Transportation Plan “FORWARD” Introduced The Kansas Department of Transportation Secretary Julie Lorenz introduced a state transportation plan for the next decade. The plan, called “Forward,” is set forth in House Bill 2588 and in Senate Bill 375. The plan replaces the now-expired T-Works program with a series of two-year reassessments of the state’s transportation and communication needs, including: maintenance and preservation projects, state highways, bridges, broadband and other communications and transportation systems. The initial phase of the program will include completion of the $435 million in T-Works projects that had been delayed due to budget shortfalls. The new program will be re-evaluated/restructured every two years to maintain flexibility and relevance with the needs of state/community/industry groups. In recent years, KDOT received $2 billion less than expected for T–WORKS, resulting in 21 delayed projects across the state, as those funds were used to cover general state budgetary needs. Governor Kelly has stated her intention to no longer use money from the state highway fund to balance the state budget, but to use those funds only for transportation infrastructure. Your association will support this plan which focuses on maintenance of state roads and bridges. Underground Storage Tank Funds The Senate Committee on Agriculture held hearings and passed out three bills favorably for passage concerning the state’s underground storage tank (UST) redevelopments funds which are managed by the Kansas Dept. of Health and Environment. SB 285 would extend the existence of the UST redevelopment fund and compensation advisory board to 2032. SB 286 would amend the Kansas storage tank act by extending Continued on Page 19 Winter 2020

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KANSAS AGRIBUSINESS RETAILERS ASSOCIATION

Chemical Facility Anti-Terrorism Standards: Overview Chemicals are vital to our economy. They are used to develop medicines that maintain our health, provide refrigeration for our food supply, manufacture fuel for our vehicles and build the microchip that runs our smartphones. But in the hands of a terrorist, some chemicals could potentially be weaponized.

What Is CFATS?

In 2006, Congress authorized the Department of Homeland Security (DHS) to establish the Chemical Facility Anti-Terrorism Standards (CFATS) program. Managed by the Cybersecurity and Infrastructure Security Agency (CISA), the CFATS program identifies and regulates high-risk chemical facilities to ensure they have security measures in place that reduce the risk of certain hazardous chemicals from being weaponized. In 2014, Congress reauthorized and amended the program through the Protecting and Securing Chemical Facilities from Terrorist Attacks Act of 2014 (6 U.S.C. § 621, et seq.). In 2019, Congress extended the four-year authorization through April 2020 via the Chemical Facility Anti-Terrorism Standards Program Extension Act. The CFATS regulation applies to facilities across many industries, including, but not limited to: • • • • •

Chemical manufacturing, storage, and distribution Energy utilities Agriculture and food Explosives Pulp and paper

• • • • • •

Electronics Plastics Universities and laboratories Paint and coatings Healthcare and pharmaceuticals Metal production and finishing

Appendix A and Chemicals of Interest (COI)

Appendix A of the CFATS regulation lists more than 300 COI and their respective screening threshold quantities (STQ) and concentrations. The COI are categorized into three main security issues: •

Release: Toxic, flammable, or explosive chemicals or materials that can be released at a facility.

Theft or Diversion: Chemicals or materials that, if stolen or diverted, can be converted into weapons using simple chemistry, equipment, or techniques.

Sabotage: Chemicals or materials that can be mixed with readily available materials.

Any facility that manufactures, stores, or distributes COI at or above the STQ and concentration is required to report their holdings to CISA via an online survey called a Top-Screen. Facilities must submit a Top Screen within 60 days of coming into possession of the COI. 14

Agribusiness Update


CFATS Process

1. If not statutorily excluded from CFATS,1 read the Appendix A COI List: www.dhs.gov/publication/cfats-coi-list 2. If your facility possesses COI at or above the STQ and concentration, submit a Top-Screen via the Chemical Security Assessment Tool (CSAT): www.dhs.gov/csat-top-screen. o To access CSAT, complete the Chemical-terrorism Vulnerability Information (CVI) training: www.dhs.gov/cfats-cvi. o Register yourself and your facility in CSAT to get access to the Top-Screen survey: csat-registration.dhs.gov/.

3. CISA reviews Top-Screens using a risk-based methodology. Facilities are notified if they are: o Determined to be a high-risk facility and ranked into Tiers 1, 2, 3, and 4, with Tier 1 being the highest risk. o Determined not to be a high-risk facility and not regulated under CFATS. 4. If your facility is tiered, your facility must submit a Security Vulnerability Assessment (SVA) and a Site Security Plan (SSP)—or an Alternative Security Program (ASP)—that meets the riskbased performance standards (RBPS): www.dhs.gov/cfats-risk-based-performance-standards. o The 18 RBPS address security issues such as perimeter security, access control, personnel security, cybersecurity, etc. o Your facility’s security plan is tailored to its tier level, risk, and unique circumstances. 5. CISA Chemical Security Inspectors perform an authorization inspection at your facility prior to approving the SSP or ASP. o Once the plan is approved, inspectors conduct regular compliance inspections to verify your facility implements the agreed-upon security measures.

CFATS Enforcement Actions

CISA is committed to helping facility personnel understand and comply with CFATS by providing technical assistance or onsite consultation. However, CISA is authorized to pursue civil enforcement action against any facility found in violation of CFATS, which could result in the imposition of a civil fine and/or the issuance of an order to cease operations. Violations vary from a facility refusing to report its COI holdings, failing to implement certain security measures, or knowingly providing false information.

Tools and Resources •

CFATS Resources: www.dhs.gov/cfats-resources

CFATS Process: www.dhs.gov/cfats-process

Request a CFATS Presentation: www.dhs.gov/request-cfats-presentation

Request a Compliance Assistance Visit: www.dhs.gov/cfats-request-compliance-assistance-visit

CFATS Knowledge Center: csat-help.dhs.gov

CSAT Help Desk (technical assistance): Call 1-866-323-2957 or email csat@hq.dhs.gov

Contact Information

For any questions or comments, email CFATS@hq.dhs.gov or visit www.dhs.gov/cfats.

Section 2101 of the CFATS Act of 2014 defined excluded facility as: a facility regulated under the Maritime Transportation Security Act of 2002; a public water systems as defined in the Safe Drinking Water Act; a Treatment Works as defined in the Federal Water Pollution Control Act; a facility owned or operated by the Department of Defense or the Department of Energy; and a facility subject to regulation by the Nuclear Regulatory Commission.

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2019-05-20


KANSAS AGRIBUSINESS RETAILERS ASSOCIATION

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BENEFACTOR SPONSORS $5,000

PATRON SPONSORS $3,500

BUILDER SPONSORS $2,000

ADM Fertilizer Beachner Grain Inc. CHS Inc. EGE Products Gavilon Fertilizer, LLC Interchem J.B. Pearl Sales and Services J.R. Simplot Co. Morrill Elevator, Inc. Offerle Coop Grain & Supply Co.

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Agribusiness Update

DONOR SPONSORS $1,250

Allied Environmental Consultants, Inc. Farmers Cooperative Equity Co. Frontier Ag Inc. MFA/AGChoice Nutrien

GIVER SPONSORS $750

Agrilead Inc. Alliance Ag & Grain LLC American Implement, Inc. Central Valley Ag Cooperative Fairbank Equipment, Inc. Helm Fertilizer Corp.

Kansas Coop Council Midwest Laboratories Inc. Miller Elevator Inc. Pride Ag Resources Ward Laboratories Inc.


SAFE AND ABUNDANT FOOD THROUGH SOUND SCIENCE

Agribusiness Associations host Legislative Action Day Kansas Agribusiness Retailers Association (KARA) hosted nearly 100 members in Topeka on Jan. 22 for Legislative Action Day. The annual Legislative Action Day presents members an opportunity to meet face-toface with their legislators in Topeka and advocate for agribusiness. KARA, Kansas Grain and Feed Association (KGFA) and Kansas Cooperative Council (KCC) welcomed nearly 100 of their shared members to Topeka for the group’s annual joint Legislative Action Day on Wednesday, Jan. 22. The annual lunch and evening reception allows members of the agribusiness industry to see government in action and meet with elected officials. “The Legislative Action Day is one of the best programs offered by KGFA, KARA and the KCC,” Kanza Cooperative chief operations officer Nick Krehbiel said. “We believe that engaging with our political representation is an important part of how our cooperative continues to provide value to our membership. We’ve been attending this for a number of years now and we deeply appreciate our industry associations providing us with a valuable forum to help foster those relationships.”

Those in attendance at the Topeka Country Club enjoyed hearing lunch-hour speeches from Governor Laura Kelly and Attorney General Derek Schmidt. Both Kelly and Schmidt promoted their office’s work positively affecting agribusiness. In the evening, members also had the opportunity to eat dinner with their legislators and get to know them in a stress-free environment. “I had a chance to visit with my representative, which was the first time I’ve met him,” McPherson Concrete Storage Systems Inc., sales manager Dub Johnson said. “I really enjoyed visiting and getting to know him while letting him know what issues are affecting agribusiness.”

Governor Laura Kelly and Attorney General Derek Schmidt delivered the keynote address over cheeseburgers at the Topeka Country Club.

Below, (L-R): MKC’s Agronomy Field Sales and Precision Ag Manager, Troy Walker; House Agriculture Committee Chairman Ron Highland (R-Wamego) and MKC’s Senior Vice President and CMO, Dave Spears.

Winter 2020

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KANSAS AGRIBUSINESS RETAILERS ASSOCIATION

TAL Class Completes Session I The 23rd class of Tomorrow’s Agribusiness Leaders completed their first of three sessions on Jan. 21. The course, in existence since 1998, is designed EST. 1998

CLASS OF 1998

CLASS OF 2010

CLASS OF 2018

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Agribusiness Update

to teach members the state and federal regulatory/legislative process and hone their leadership skills in their profession. The convenient timing of Legislative Action Day also allowed KARA’s 23rd Tomorrow’s Agribusiness Leaders (TAL) class to learn about state-level government firsthand. “Every January, I look forward to the TAL class coming to Topeka for Session I eager to learn about the legislative process and their association,” KARA President and CEO Ron Seeber said. “It’s one of the most satisfying parts of my profession to see graduation in November where they walk away with a wealth of experience on both the state and federal government and when we call on them to contact their legislator about a proposed law, they answer the call every time.” This year’s class includes Aaron Anderson (Nutrien Ag Solutions), Hillary Birtell (CoMark Equity Alliance), Kalen Cromwell (Farmers Cooperative Grain Association), Kiley DeDonder (WinField United), Micala Dummit (The Scoular Company), Brice Elnicki (Producers Cooperative Association of Girard), Amy Fairchild (ProValue Insurance), Scott Moseley (KC Supply Company), Tyler Peterson (Pride Ag Resources) and Spencer Reames (MKC).

“I had no real idea of how the legislative process worked,” Anderson said. “After sitting in on Senate hearings, I learned how a bill gets introduced and I learned that our legislators want to hear from us and how easy it is to reach out to them.” The TAL class completed its first of three sessions with the culmination of Legislative Action Day and will meet again in July to travel to Washington, D.C., to meet with Kansas’ congressional delegation and national associations. The Tomorrow’s Agribusiness Leaders Program – a jointly sponsored initiative of the Kansas Grain and Feed Association and the Kansas Agribusiness Retailers Association – is an intensive leadership development program designed to teach members of the association, about the state and federal legislative and regulatory process and how to be a better leader within the industry.


SAFE AND ABUNDANT FOOD THROUGH SOUND SCIENCE

Continued from Page 13 the sunset of the aboveground fund and the underground fund and increasing the maximum reimbursement from the fund. SB 287 would amend the Kansas storage tank act by extending the expiration of certain reimbursement provisions to 2030 and increasing the underground storage tank replacement reimbursement maximum. Your association testified in support of these bills. Scrap Metal Theft Reduction Act Following many meetings and hearings over the scrap metal theft reduction act last session, the legislature finally passed a bill which created the scrap metal data repository fund, and authorized the Kansas Bureau of Investigation to administer the scrap metal theft program. Your association joined a group of interested stakeholders in supporting passage of the bill. This year, the Senate Committee on Judiciary held a hearing on SB 344, a bill which would seek to remove the photograph requirement for all customers seeking to recycle certain types of metal listed within the scrap metal theft reduction act. A scrap metal recycling company proponent stated that they wanted these changes because they were concerned with the privacy of their customers, and stated that the photograph requirement was overly burdensome. Your association will monitor this closely to ensure the act remains intact. New Air Quality Funding Fees Proposed by KDHE Your association joined with other industry stakeholders in testifying before the Senate Ways and Means Subcommittee on a funding need for the Kansas Department of Health and Environment’s Bureau of Air Quality. Industry asked the committee to review the Bureau’s budgetary needs after the Bureau informed industry stakeholders that it intends to increase air quality emission fees on Class I and Class II emitters by approximately $1.5 million in 2020 and every year thereafter.

Audit. KDA testified that large truck scales are found out of tolerance during about 50 percent of all inspections. The agency indicated that there are approximately 20 large scale inspection companies licensed to operate in Kansas. KDA indicated that they generally do not assume malicious behavior unless a problem is cited during an inspection and then was not corrected before a follow-up inspection. State Water Plan Fund Each year, the agricultural industry through pesticide registration fees and fertilizer tonnage inspection fees – pay approximately $6 million into the state water plan fund. Local water districts also submit about $6 million annually into the fund through fees on water users. State law requires $6 million in matching funds from the state general fund, but the full statutory amount has not been funded since 2009. In 2019, the legislature increased state general funds to the state water plan, but still below what is required by Kansas law. Bills are routinely introduced to increase the size of the SWPF by increasing fees on our industry. Your association will continue to oppose any legislation seeking to increase fees on our industry for the state water plan fund. We will also seek inclusion of the full statutory $6 million transfer into the state water plan fund from the state general fund.

Going Forward State budget projections show the state will be underfunded by 2023. The legislature will need to cover these budgetary shortfalls, caused by the state retirement system (KPERS), the state highway plan, Medicaid expansion, school funding, and increased funding for social services. In order to cover these expenses, the legislature may look to add new funding mechanisms on the ag sector through such things as: sales taxes on ag services, utilities, and red-dyed diesel fuel; eliminating sales tax exemptions on farm machinery and equipment; creating other forms of excise taxes; removing barriers to property tax increases, and, increasing income taxes on corporations and other businesses. Following the 2020 census, and the resulting reapportionment, the agricultural industry and rural Kansas will likely lose legislative seats to more urban areas of the state. As a result, the agricultural industry could increasingly become a target of various tax increases. Kansas Agri-Business Council (KABC) Your government affairs team will remain vigilant in opposing any effort to balance the state budget on the backs of our industry. Thank you for your contributions to the KABC, which are vital to Your association maintaining a strong voice in the legislative process.

KDA Scale Inspection Program Challenged The House Committee on Agriculture received a briefing from the Kansas Dept. of Agriculture’s (KDA) Division of Weights and Measures on its weights and measures inspection programs following an audit of the program by the Legislative Division of Post Winter 2020

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