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The Senate met on Tuesday, December 8 to discuss interim charges on agricultural liens, waterborne litter, market development, and management of game animals. The committee heard invited testimony only.

Charge 6: Study the economic benefits the Texas Department of Agriculture's Market Development Services provide to the state through promoting Texas Agricultural products. Review the current marketing services and strategies available to Texas producers and determine additional resources necessary to increase the Market Development Services capabilities. Make recommendations for legislative action, if needed.

Tina Bick and Mark Wiles, Legislative Budget Board

  • 84th legislature made a revenue target for TDA $42.5 million over 16-17 biennium which was an increase of 5.1 million over the previous biennium
  • TDA’s current plan shows a $22.6 million increase in revenue over the next biennium which would be 16.5 million increase over what the legislature predicted
  • Agency is allowed to collect monies over the biennium revenue target
  • Chair Perry says there is capital support in the fee increase
  • Chair Perry asks if most agencies request capital support through LAR process
    • In theory a commissioner wanting to spend this much money on capital would submit the schedule to the legislature
  • Chair Perry says that the agency can increase the fees, but there is a process for using money for capital
  • Chair Perry says there is never the ability for an agency to bounce a check because the comptroller makes sure the checks would not bounce
    • Correct, the comptroller is satisfied if the agency is on a trend that meets the revenue target
  • Chair Perry asks if other agencies have the luxury of a reserve account
    • No, most other agencies routinely overshoot their revenue target
  • Chair Perry says transfer and UB authority has become a contention; it was available to the previous Ag. Commissioner, but is not anymore; there is GR with no strings attached and fee revenue that has strings attached
    • Unlimited transfer ability was taken away from the agency
    • Programs should be stand alone; for example a weights and measures operator should not subsidize marketing
    • UB authority was taken away, but the Legislative Budget Board has the ability to grant the request which Commissioner Sid Miller made
    • Agency is on track to meet revenue target in the budget, and to meet their revenue they may need that money
  • Encumbrance ability of agency has to come from funds that in a given fiscal year
  • Chair Perry asks if the prior commissioner utilized transfer and UB ability
    • Yes, that is one reason the abilities have been made more strict
    • Prior administration transferred GR from adult and child nutrition strategies into several strategies with cost recovery programs
    • Since 1989, agencies have cost recovery requirements which came into play in the 12-13 biennium
  • Chair Perry asks what it means when monies are lapsed
    • Cash lapse – if cash is collected over and above what they spend or encumber, that money lapses back into GR
  • Chair Perry explains that there are cash and book entry lapses; did the former commissioner ever give back cash lapses?
    • Yes, there were times cash was given back to the state
    • Commissioner has ability to receive money above BRE, and he does not have to give it back if he does not spend it
  • Chair Perry asks about LAR request
    • $47 million request
    • Agencies proposal would be $7.8 million in weights and measures program, which is not in the LAR request
    • The request is mostly marketing related
  • Sen. Hinojosa asks if TDA has authority to raise the fees by statute
    • Yes, in rider 28
  • Sen. Hinojosa asks how rider 28 relates to statutory authority
    • It is legislatures directive and sets requirement that each program be self-supporting
    • Commissioner can be entrepreneurial
  • Sen. Hinojosa asks if it is possible to put a limit on fee revenue
    • Future versions of the budget could use “amount not to exceed” language
    • We cannot go back on the current budget
  • Weights and measures item had 14 FTEs which is part of the requested money
  • Sen. Hinojosa says it seems that their request is 5.1 million, but they are raising an additional $16 million which they have the authority to do, but this is an issue
  • Sen. Zaffirini says the legislature set a target of 42.5 million which was a 5.1 million increase
    • Fees are expected to be raised, but they were raised to collect 16 million on top of that
  • Sen. Zaffirini asks what type of precedent that would set and points out that the industry had no time for input other than public comment during the legislature
    • $7.8 million weights and measures item was never presented to LBB
  • Sen. Zaffirini fears this could cause agencies to follow TDA’s example
  • It may have been legislature’s intent to allow this but they are allowed to use “not to exceed” language
  • Sen. Rodriguez asks which agencies can actually perform under the “entrepreneurial spirit” in order to grow programs
    • TPWD has had language to spend collections in excess of BRE
    • There are overages that the legislature wants and a lot of that goes back to the statutory enabling language
  • Sen. Rodriguez asks if it is correct that commissioner did not have opportunity to submit LAR so that is why he is asking for the fee increase because of transition between office holder
    • Fee proposal does not talk about 8 million dollar exceptional item
  • Sen. Rodriguez asks if transfer and UB authority are restored, if the fees would be lowered
    • Commissioner can speak to that
  • Sen. Rodriguez asks if it was necessary to include cost relief request in the request
    • The comptroller will look at revenue trends, not over month to month
  • Sen. Rodriguez asks if they can justify 600% increases
    • That is a good question for the commissioner
    • Some fees are as old as 1996, but we have not done that analysis
  • Chair Perry asks if the 5.1 million extended any metrics to meet
    • There was an incremental performance measure benefit
  • Sen. Hinojosa says next time we should place limits on fees to fix this issue
  • Chair Perry says just because you can doesn’t mean you should
  • Sen. Zaffirni asks if we will address the marketing aspect in the charge today
    • Chair Perry says we will play it by ear to see if there is time

Commissioner Sid Miller and Diana Warner, TDA

  • Miller says it pains him to raise any fees and this is not taken lightly
  • In 2011 LBB mentioned we were upside down $27 million and TDA was cut 40% and lost 150 employees
  • Cost recovery program was never implanted
  • Requested additional dollars to restore some of the cuts and the legislature did not do that
  • This was laid out to Agriculture Council, Farm Bureau, Seed Trade Association
  • We did not know what the fees were at the time, but I did know that we had 8 months left in budget cycle and we were going to be $7.8 million short on fees and $16 million short overall
  • Prior administration had some tools that we do not have now to recover costs
  • We studied true costs of each strategy
  • LAR that was turned in for total fuel cost was $92 thousand, but the actual fuel cost on average over the last three years was $663 thousand and there were many costs that were off
  • There was a large backlog on many permits
  • Legal division had 2000 cases that had never been filed so businesses did not know they were in violation
  • Operation Maverick has found over 8400 businesses that should be registered with TDA but are not – 3100 of those are gold and silver buyers and their scales have never been checked
  • Grocery stores haven’t been checked in many years and 53% of one chain we checked were out of compliance
  • Without UB and transfer authority, Miller says he is stuck, but is motivated to get the agency back in good footing
  • Consumers can pay, industry can pay, or there can be a combination of the two
    • Since costs are passed on, consumers pay no matter what
  • Cost to run the strategies did not meet the LAR
  • We have to fully recover our cost to perform the duties we’ve been charged with
  • Chair Perry asks what Miller would say the mission of the TDA is
    • Perform statutes provided to us by legislature
  • Chair Perry says there is element of public safety and that is what about 34 million of GR is for; fees are for marketing and cost recovery
    • That is correct
    • We can recover costs, but the difficulty is marketing because you see that recoup on the back end
  • Chair Perry says today we will set Go Texan marketing issue aside and he has about 20 questions
  • Chair Perry asks if this increase in revenue will increase inspection or output measures for any program
    • Not at the beginning because we have to work through the backlog
    • After we get back to even, performance will go up
  • Chair Perry says part of request is replacement component, but those are typically reserved in the LAR request; the state goes through LAR requests pretty thoroughly, but you went outside of that and built replacement component in fee structure; why would you think you should be treated independently from what is normal
    • There are costs we have to face and upgrades that need to be made
    • Vehicle replacement is part of cost recovery
  • Chair Perry asks if Miller was too new to the process to be able to say how short TDA was in the beginning, were these items included in his 150 million request which was 50 million over the baseline
    • I did not know how bad the strategies were off until the end of the summer
    • 16 million increase will get us back in the black, but the 50 million over the baseline had some bells and whistles
  • Sen. Zaffirini says that legislators were against this which is why the fees were postponed
    • Miller says he respects the legislative body and has been open and transparent
  • Sen. Zaffirini asks if Miller told industry what benefits they would see
    • Fees are get strategies back in black, not to increase benefits
  • Sen. Zaffirini asks about the grocery stores checked
    • In the chain we checked, 47% of stores have scales out of compliance
  • Sen. Zaffirni asks what would happen if we do not raise fees
    • I would ask which strategy you want me to get rid of
    • I can’t move money from strategy to strategy like in previous administrations
    • I believe salary savings are not a good way to balance a budget
    • I have requested UB authority from LBB
  • Sen. Zaffirini asked if the industry had sufficient opportunity to testify about fee increases
    • They were not a topic during the legislative session
  • Sen. Zaffirini asked whether the agency is trying to make up for funds that were not appropriated
    • No; just trying to do what the legislature requested in 2011 that hasn’t been done yet; some of these fees haven’t been adjusted since 1996
  • Sen. Hinojosa asked about not having transfer authority; if that authority was given would the fees have been raised as high as they were
    • It would have absolutely given more flexibility
  • Sen. Rodriguez noted he feels like the agency does not have enough flexibility to be able to do what is necessary; sounds like the fee structure is outdated; how has the agency come to this positions when the predecessor had so much additional authority
    • The finances of the agency can no longer be juggled around; the previous administration had those abilities to cover the cost of the programs
  • Sen. Rodriguez asked if there can be some sort of phased-in approach to raising the fees
    • They have already been published in the Texas Register; can find more efficiencies and get better at administering programs and the agency can take another shot at this; having transfer authority would not completely solve the problem but it is likely that the fees could be adjusted down some
  • Sen. Rodriguez asked why transfer authority was taken away
    • That would be a good question for LBB; assume it was because money that was intended for salaries in each strategy was used to plug holes in the budget in the past
  • Sen. Hinojosa noted it was not the LBB it was the Finance Committee
  • Chair Perry noted that transfer authority and UB authority are not one in the same
    • Miller agreed and noted if he had to choose one or the other he would rather have the UB authority back
  • Sen. Kolkhorst noted that the fee increases are significant percentage increases; understands this is not done casually; everyone needs to understand the gravity of this issue; the fee increases spread across many different industries, not just farmers; the legislature needs to make a decision whether agriculture will be invested in by the state because otherwise the consumer will have these costs passed down to them; the agency needs to improve communication with producers and ag groups
    • Miller noted the agency was not in contact with stakeholder like they should have been when the calculations were being made and the needs of the agency were considered; however, the agency was very diligent in consulting with stakeholders when the proposal was created; there is no desire to raise the fees beyond the needs of the programs
  • Chair Perry noted he would like to know how much indirect costs have increased
  • Chair Perry says he would be in favor of UB authority to safe the fee payer
  • Chair Perry asks if there is a list of what all is considered a direct cost
    • We will get a list put together
  • Sen. Kolkhorst asks what the average salary is at TDA
    • $51,000 per year
    • Sea Trade association said it was 73,000 and that is not accurate
  • Sen. Kolkhorst asks Miller about the bad publicity
    • We are focused on the future and getting the agency back on its feet
    • Miller wants to be the best Ag Commissioner there has been
  • Sen. Kolkhorst asks how Miller defines the best
    • Increased efficiency and customer service
    • The agency is going to self-sunset itself
    • Miller called state auditor and asked them to audit the agency
  • Sen. Kolkhorst expresses the importance of serving and customer service; she wants to have tools available to serve the public; we need to be careful because businesses will feel these fees
  • Chair Perry wants to make sure metrics for compliance are fair and give freedom; for example, if the grocery store scales are off by a negligible amount
  • Miller wants to do all checks in one trip and cross-train employees – the current system is inefficient; at that point the fees will be able to fall
  • Sen. Kolkhorst asks about cross-training effectiveness
    • Certain strategies cannot be cross-trained
    • Cross-trained employees are very well trained
  • Sen. Kolkhorst says experienced inspectors are of utmost importance
  • Chair Perry asks what will happen if they do not get the $8 million for marketing
    • We project that the fee structure will allow us to operate those strategies
  • Rep. Gonzales asks if the agency has exercised their article 9 authority to request
  • It is clarified that the money that was taken away by the legislature and the LBB has the ability to give it back

Tina Bick is called back up, Legislative Budget Board

  • The board can decide to grant UB requests from the agency
  • Chair Perry asks if there is a statutory time frame
    • No there is not
  • Chair Perry asks if there is an 8 million short fall as described by Miller
    • Most of the lapse was marketing and not weights and scales
  • Chair Perry says if we have collected a seed fee and it is in bank on August 1, are there any protections to industry that provided the fee that it will be swept into GR and lost; it is not fair to ask agency to be in cash recovery and the money gets washed away because of a timing issue
    • Chair Perry says the UB authority under that circumstance would not be considerd “playing games” it is TDA’s money
    • Chair Perry does not personally think transfer authority is appropriate, but UB authority should be granted if this is the circumstance
  • Sen. Kolkhorst asks in talking about UB authority if in the past the agency was able to not fill FTE positions to fund something else
    • Yes they had that ability previously
  • Transfer authority for TDA for cost recovery programs alone was taken away
    • Transfer ability is still in place to non-cost recovery programs
  • Sen. Kolkhorst asks if all state agencies usually have UB authority
    • Not always, but they can all access article 9 provision to ask for UB authority
  • Sen. Kolkhorst asks about difference within biennium and sometimes it is authority between biennium
    • The latter is very rare and TDA has never had that ability

Gary Huddleston, Kroger Company and Texas Retailers Association

  • Fee increases caused concern as they have a direct impact on grocery industry
  • Raising a wide variety of fees without stakeholder input puts us in a bad position
  • Fees will cause price increases to consumers
    • 38 scales per store that have to be certified which costs $116,000 per year for Krogers in Texas
    • Increases add up for grocery stores
  • We need predictable fee structure with possible percent limit on increases
  • Chair Perry wants to know if there is data about how these fees affect competitive nature of Texas and what the margins are for Kroger
    • Margin is 1% and other information can be provided in the future
  • Sen. Zaffirini asks how the current fees and proposed increase fees compare to that of other states
    • That is not known today
  • Sen. Rodriguez recalls reading that a Texas market had disparity and prices with regards to shrimp; it is important to have ability to ensure that scales are operating as they should
    • We recognize fees are necessary, but this one time increase is exorbitant and the notice was not sufficient
  • Sen. Kolkhorst says it seemed like scales program was supplementing other programs, so why are they increased if they were already carrying water for other programs
  • Sen. Perry explains that this was the problem with transfer authority from the beginning

Kenneth Dierschke, Texas Farm Bureau

  • Commissioner Miller requested funding from bureau, which they decided were not under their purview for multiple reasons
  • Increased user fees were never mentioned as a possible result; stakeholders were never consulted
  • Fee increases were expected to cover $5 million increase, but not for the additional money
  • We are concerned about the cumulative effect of the fee increase
  • We do not want to fund a fee increase that will be swept into GR; only fees to recover costs
  • There has not been a sufficient reason given
  • We support whatever delay is necessary for fully transparent process of fee increases
  • Sen. Zaffirini asks what hope Dierschke has to work with the representatives of the agency to resolve this issue
    • More conversation and more discussion
    • We expected some increase but were blindsided by the rest of this
  • Sen. Zaffirini asks if there is a suggested process
    • Not aware of a current process, but any conversation possibilities
  • Sen. Zaffirini asks about concerns with what Miller says if fees were not increased
    • We need to look at this more together
  • Sen. Rodriguez says Dierschke pointed out in written testimony that animal health commission had a better process
    • There was more conversation and discussion about how this was to be done

Bryan Gentsch, Texas Seed Trade Association

  • TDA is considered our largest business partner
  • If we break revenue increases into small medium and large companies
    • Large 80-150 thousand per year
    • Medium 40-80 thousand per year
    • Small companies 20-40 thousand
  • Losses will result in laid off employees
  • Fee structure is excessive
  • Our fees doubled in 2011 even though services were severely slashed
  • Fee increases were expected, but not at these levels
  • Sen. Kolkhorst says she has seed lab in Giddings Texas and asks if he was blindsided by the fee increases
    • Yes we had agreed to fee increases and were told that the original 30% increase proposed may need to be “tweaked,” but we were blindsided by the excessive increases
  • Sen. Kolkhorst alludes to the fact that Grentsch would have been sitting in committee hearings during the legislature to prevent this from happening
  • We are supportive of restoring UB authority because it makes sense in those situations
  • Since 2011, our fees will have increased an average of 550% if these fees go into effect
  • Sen. Kolkhorst explains that there were severe cuts to TDA which forced fee increases which were not restored in 2013 even though the legislature restored money

George Ferguson, Frank Bailey Grain Company

  • Grain facilities are facing huge losses from fee increases
  • There will be attrition

Charge: Study and make recommendations on improving the laws regarding the management of game animals, production of domestic fowl, and development of agricultural products in the State to reduce the occurrence and spread of disease and harmful pests.

Carter Smith, Texas Parks and Wildlife Department

  • We are more than receptive on continuing to improve this situation
  • Texas leads nation in amount of deer hunters and in Texas white tail deer are king
  • This affects tourism, farmers and ranchers, and real estate interests
  • CWD is a fatal neurological disease with no vaccine or cure
  • There is not an epidemic or pandemic; since 2012 we found CWD in only 3 facilities, but we have to confront the perceptions of this disease
  • Our goals were to contain and isolate as well as amplify surveillance and to minimize impact of CWD

Dee Ellis, Texas Animal Health Commission

  • We are trying to make this as palatable as possible by being open to meet with stakeholders and TPWD
  • We are doing disease investigation to see what happened and how to catch it closer
  • Surveillance is strength of any disease program
  • National industry leaders from across the state will be working on this
  • We need scientifically validated live tests, but currently those are not available

Dr. Andy Schwartz, Texas Animal Health Commission

  • CWD is progressive, fatal, degenerative neurological disease of deer, elk, and moose only
  • Disease is not completely characterized – believed to be proteins called prions
  • CWD has a long incubation period – infected animals may  not show visible signs of disease for years
  • Signs include progressive weight loss, stumbling, tremors, changes in behavior, and drooping ears but are not specific to CWD
  • Studies on live animal tests are ongoing; there is no known treatment or vaccine for CWD
  • Currently testing procedures involve postmortem samples but live tests would be endorsed if they are proven effective
  • Medina County affected herd was confirmed on June in 2015
  • Owner is being indemnified for remainder of the herd removed on September 30, 2015. No additional positives found in the herd
  • Multi-agency CWD working group formed (TAHC, TPWD, TVMDL, and USDA-APHIS-VS)
  • 5 year investigation span – trace in and trace out
  • Herd plan for management of trace forward herds with testing of exposed animals
  • Recommended criteria for movement qualification of herds not in Tier 1
  • Index herd testing/management plan
  • Herd plans for trace forward herds where exposed animal is not tested
  • Herd plan for trace in herds
  • Tier 1 Facilities and Deer
    • Trace In: 20 facilities, 126 deer
    • Trace out: 147 facilities 835 deer
    • 96 breeders
    • 46 release sites
    • 3DMPs 2 International
  • Lavaca County Affected Herd purchased deer from Medina Herd in October 2014
    • Remains under quarantine
    • Biopsies taken from 12 deer – 2 additional CWD positive bucks
    • All 3 positives age and pen cohorts with the 4 positives in Medina County herd

Clayton Wolf, Texas Parks and Wildlife Department

  • We have interagency goal to protect the resource
  • Luckily June is the slowest time of the year for deer movement, September is the highest
  • Breeder Deer Movement and Liberation Objectives
    • Enhance the chance of detecting the disease if/where it is present
    • Resume breeder deer movement and liberation weeks prior to September 22
    • Allow movement and liberation options for as many facilities as possible
    • Minimize compulsory harvest at the release sites
  • TPWD and TAHC have worked closely together and with stakeholders
  • Interim rules were filed and effective and TWIMS was activated in August; TWIMS is a database that tracks movement
  • New Rules
    • Three categories for breeding facilities and release site
    • TC 1 facility is highest testing facilities, followed by TC 2, then TC 3
    • Release sites are Class 1, Class 2 or Class 3 depending on which breeding facilities they receive deer from
  • DMP, TTT, TTP emergency interim rules filed and effective October 5
  • Surveillance increased by sampling at 33 management resource units instead of the original 10
  • Samples have increased greatly and we are keeping geographic information on the samples by species
  • Plans for the future
    • Continue hunter-harvest sampling
    • Jan. 12 – CWD live-animal testing symposium
    • March 23 – Present new CWD regulation package to TPWD
    • May 25 – TPWD Commission considers adoption of new regulations
  • Chair Perry expresses that he is impressed with the stakeholder involvement throughout the process
  • Chair Perry asks for current definition of surveillance herd
    • Essentially all herds are surveillance herds but they are split into different categories from there
  • Since we started CWD testing requirements, individuals bare the cost of testing requirements
    • TPWD bears cost for hunter-harvest surveillance
  • Cost is about $100 per animal, we need to know what the total cost would be to state
  • Sen. Perry believes there is perception that deer breeders are carrying unfair portion of the cost, and this should be kept in mind as we move forward
  • Sen. Perry says that the legislature deferred the tangential issues of live and residual testing and this should be addressed in the next session; asks TAHC and TPWD to keep in mind moving forward; live testing should be part of discussion moving forward
  • Sen. Zaffirini says 13 counties have been assessed at maximum or extreme risk In CWD; what impact has this had on hunting industry
    • Smith says it is hard to quantify this issue, but we have had a lot of voluntary cooperation to make sure we can resolve this issue
  • Sen. Zaffirini asks what we tell people who want to start a facility
    • Smith says we walk them through the regulatory process and if they have specific questions about CWD, we have biologists visit with them directly
  • Sen. Zaffirini asks what land owners can do to minimize risk
    • The more samples we get, the better off we are – we expect CWD levels to be incredibly low
  • Sen. Zaffirini asks what obstacles we’ve faced with live testing
    • Dr. Ellis says the issue with live testing is in interpretation of results
    • The long incubation period poses problem – positive definitely means positive, but negative does not necessarily mean negative
    • Live animal tests are not validated
    • Dr. Schwartz adds that there are genetic differences with live testing as well
  • Sen. Zaffirini asks for any legislative requests
    • Smith says he cannot speak to that at this point
  • Sen. Zaffirini asks about a lawsuit against TPWD
    • There are two lawsuits but they did not come from TDA, they came from individuals
    • Both individuals are from Houston but their operations are in different counties
  • Sen. Rodriguez says that this is a large issue, not just a dispute between large and small breeding facilities; congratulates TPWD and TAHC on bringing in stakeholders
  • Sen. Kolkhorst asks if prior to emergency rules deer could be released to low fence areas and are those considered trace-in
    • Wolf says this was rare but it was allowed
  • Sen. Kolkhorst asks if Lavaca county positives came from Medina county
    • Yes, those three deer were born in Medina county
  • Sen. Kolkhorst asks if we are comfortable with the current sample size
    • We believe the vast majority of Texas is CWD free
  • Sen. Kolkhorst asks if we were overzealous
    • No compulsory harvest was required for vast majority of people with deer breeder permits
    • The testing requirements did affect how these sites are classified
  • Sen. Kokhorst says it was probably TC2 and tier II that had the most risk associated with them because they are not gold standard testing, but can still transfer
  • Sen. Hall says he has mad conversations with many breeders in his area about concerns with the exuberance of the program; it makes it appear the government is picking winners and losers; these complaints are not necessarily accurate but this is the perception
    • Smith says all legislators are encouraged to come with concerns
  • Chair Perry says it is his understanding that the Medina corral had elk in close proximity, but we have not had all the regulations around elk even though they are closely contained and would like an answer on that in the future

Patrick Tarlton, Texas Deer Association Executive Director

  • Contribution to economy is in jeopardy
  • Rhetoric around CWD has forever tainted the industry
  • Burdensome testing affects rural Texas the most
  • Disease management and private property rights need to be balanced
  • Deer industry needs permitting process with regulatory certainty and conducive to growth
  • Sen. Perry wants to clarify their issue with the current standing of the rules
    • The rules went backwards instead of going forward
    • People who were previously in good standing with the law had to go back and put down parts of their herd
    • TC 2 had to go back and test 4.5% which had never been a standard previously
  • Sen. Kolkhorst asks if TDA believes deer ranchers should own the deer
    • We do not have a policy position

David Yeates, Texas Wildlife Association

  • TAHC and TPWD did incredible job in handling the issue
  • Precedent needs to be followed in any rule making
  • This issue transcends  deer breeding
  • We are not anti deer-breeding, but we do recommend some balance in agency
  • Sen. Kolkhorst expresses that it is difficult to balance deer breeders and all the other industries and says that Texas Wildlife Association and Texas Deer association both need to work together well
    • Yeates and Tarlton say they get along well
  • Chair Perry says all stakeholders need to be working together on this issue

 
Charge: Study and make recommendations on improving the law in this state regarding agricultural liens under Chapter 70, Agricultural Code. The study should include whether sufficient safeguards exist to protect the financial interest agricultural producers have in their product.

Representative from Texas Farm Bureau

  • Law should be clear that farmers have right to repossess their property
  • Farmers grain should never be liquidated to pay for part of a facilities bankruptcy proceeding
  • If lien on open storages is not the best solution, then we need to find out what is

Marc Adams, CoBank

  • SB 1339 was meant to protect farmers from loss which is good
  • Ag lien has unintentional consequences of impeding financing

Representative from Prosperity Bank

  • Supports SB 1339 generally
  • Record losses are occurring on Texas Gulf Coast as a result of 2013-14 crops
  • Grain industry has changed drastically recently, no supervision or jurisdiction over merchandisers, wants a broad-scope evaluation of grain trading in Texas

 
Gary Holcomb, Ag Producers Co-op

  • Would like the exemption for publicly licensed warehouses to continue
  • Allowing farmer liens on warehouses is dangerous business policy for warehouse owners with impediments far outweighing the benefits, thus the exemption was created
  • It is the best interest of industry and the state to analyze grain buyers, but warehouse laws are stringent enough to flush out the bad actors
  • Chair Perry thinks that the losses are unacceptable, asks if he wants all public license warehouses exempt
    • Yes
  • Chair Perry does not think this request would change the current situation, thinks that bankruptcy of the warehouse forfeiting the farmer-owned grain inside is unjust, farmer’s product is being used to pay a debt they do not owe
  • Sen. Zaffirini asks if farmers who have their grain in storage should be considered secured creditors
    • Texas Farm Bureau does not think so as it is the farmer’s grain
    • Co Bank and Prosperity bank consider grain a priority payment, farmers are secured creditors and this should be honored
    • Ag Producers Co-op comments that they hold farmer’s product securely, and warehouse laws are constructed to protect them
  • Sen. Zaffirini asks if banks have placed liens on grain
    • Farm Bureau responds that they have not heard of this, focused on bankruptcy issue
    • Co Bank thinks this is a legislative issue that could be handled via bonds
  • Chair Perry comments that inspection of grain is not a state role, if the bank does not conduct proper inspections then it is unfair for bank to receive full 100% collateral
  • Three types of ownership of grain
    • Warehouse receipt is negotiable
    • Leave it in open storage
    • Or can sell it to warehouse

Karen Neeley, Independent Bankers Association

  • Majority of Independent Bankers Association lenders finance producers and want to make sure that they get paid
  • Transparency and prioritization are important; stakeholders should get together and work through tracing who owns what

Charge: Study and make recommendations on the effects of windblown and waterborne litter. The study should include an analysis of the economic effects of litter, any necessary methods to prevent and remediate litter, and an assessment of state and local programs to reduce litter.

Warren Oakley, Fort Stockton Code Enforcement

  • Stopping area for fueling and lodging
  • Fort Stockton was one of the first cities to prohibit plastic bags which polluted the area
  • Walmart discontinued use of plastic bags and used brown paper bags instead
  • City ordinance requires retailers have to have 6 foot fence around dumpsters
  • Fort Stockton has a problem with plastic bags in sewers and treatment plants
  • Retailers are requested to use large trash compacters
  • Fort Stockton does not get any help from the state government and asks for more stringent laws to diminish litter
  • Sen. Zaffirini asks what we should prioritize to fix
    • Possibly provide refunds for plastic bottles and other litter – some type of incentive to clean up trash

Michael Talbott, Harris County Flood Control District

  • Special Purpose District which is not allowed to spend money on litter, but has to comply with regulation
  • Litter and floatables are an aesthetic issue as well as an issue for tourism and wildlife
  • There are a lot of organizations that volunteer and help
  • This should be addressed better in source control (industry)
  • Sen. Zaffirini asks what we should prioritize
    • Source control and reducing plastic bags

Brandon Bennett, Fort Worth

  • Intentional littering has been on the decline since the 90s, so now we see more unintentional littering which requires more attention
  • Non-roadway litter is increasingly problematic; the closer somebody is to a trash receptor, the more likely they are to throw it away
  • We don’t have enough community service workers to clean up litter
  • We can’t do this alone, we need to partner with both the state and industry
  • Sen. Zaffirini asks what we should prioritize
    • A broader message of getting back to basics
    • Don’t mess with Texas
    • Technologies to make processes more efficient
    • Partnerships

Dianne Wasssenich, San Marcos River Foundation

  • Tubing in the San Marcos river contributes to litter
  • Tubing outfitters are not putting net bags on tubes to collect litter and are allowing people with glass bottles into the river
  • Litter is tiling up in deep layers – mostly beer cans
  • Offering local entities to pass rules for tubing outfitters would be helpful
  • Sen. Zaffirini asks what we should prioritize
    • Plastic bags
    • Deposit to earn money for picking up bottles
    • Water oriented recreation districts need law enforcement
  • Sen. Rodriguez comments that in El Paso there are a lot of initiatives to avoid litter and volunteering to help clean up; but nevertheless this is a constant battle
  • Chair Perry says education is one of the best avenues

Meeting Adjourned