Lab takes funds from predator programs
August 4, 2014
Frustration is mounting among state ag entities as the Montana Department of Livestock continues to operate in the red and reduce funding of brand and predator programs despite being primarily funded with producer dollars. The MDOL lists the increasing responsibility of funding the state diagnostic lab as the primary reason for its current financial situation.
"What is really happening is the needs of the diagnostic lab have become more than the department can fund with our per-capita fee. We used to get about 45 percent of the lab funded through our general fund, but over the years that has been cut to as low as 6 percent and falls at 14 percent currently. In order to keep that lab functional we have made up the difference, and it has come to the point that is no longer a sustainable funding mechanism," said MDOL executive director Christian Mackay.
Not only is the state diagnostic lab eating up a greater and greater portion of the MDOL's current budget, but expenditures for the lab, in combination with a lack of budget management and oversight by the board itself have resulted in a troubling drain of the department's entire savings according to Montana Woolgrowers Association executive director Greg Wichman.
"Three years ago the MDOL had over a $3 million surplus, and they have spent that down to almost nothing. At this point, without an infusion of cash from the 2015 legislature, the board could find itself in the red financially. There has to be an improvement in fiscal responsibility by the MDOL at some point in order to fix this," he said.
Further adding to the frustration is the fact that the MDOL is primarily funded with producer dollars, meaning their budget should not only be balanced, but geared toward necessary producer programs as stated in state statute, according to Montana Farm Bureau Federation vice president of governmental affairs, John Youngberg.
"The majority of the MDOL budget comes from a couple sources. One is the per-capita tax, which is a tax on all livestock: cows, horses, sheep, all the way down to bees and chickens. You have a set per-capita amount you're taxed on those species and it all goes into the MDOL for a total of $4.4 million in 2013.
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"The second major source of their budget comes in the form of brand registration fees, which come due every 10 years. The cost of those just went up to $200 per brand. They also have money generated from brand inspections, which were also recently raised to $.75, and which are in effect every time livestock are sold or moved across county lines," said Youngberg, adding that additional MDOL funding is derived from a small general fund primarily in place to match federal funds on meat and egg inspections. The increased inspection fee is now at the maximum level allowed by state statute.
"We have been following this for some time, and a couple legislative sessions ago they came with an unbalanced budget. We worked with the MDOL a lot in trying to help them understand what was going on, and to get the legislature to pass a budget for them rather than OTO'ing (One Time Only) their proposed budget. The MDOL came back the following year with a balanced budget that cut the number of brand inspectors. Well, that's the easy way to go for them, but there would be an immediate scream in the country, and we didn't want to lose those brand inspectors. So, we made the agreement with the legislature to raise the brand inspection fees and not cut inspectors. But, they didn't raise the fee enough to cover their costs, so that didn't work to solve the issue," said Youngberg.
The lack of funding allocated for predator control purposes has been the primary concern of the MWGA, in addition to the future ramifications if the MDOL cannot find a way to manage their budget.
"There has been talk among some legislators that if the MDOL cannot get their budget management under control they may decide to fold that entity into the Department of Agriculture, resulting in the loss of our livestock department. We are very concerned about the additional ramifications that would have for predator control, specifically the two helicopters currently used for predator management," said Wichman.
On top of the lack of funds for producer relevant programs has been the irritation the MWGA and MFBF have felt over the MDOL's lack of willingness to work with the state ag entities that fund it.
"Until recently the MDOL has been more inclined to attack us for pointing things out than to actually focus on getting their house in order. We are not attempting to make this a personal issue. This is the result of the fact that for the last 10 years or so, the board and its personnel have not shown an ability to manage the money and business of the Livestock Board. We see the need for change, particularly in the position of who serves as the chair of the board, so the board can once again do what it was designed to do," said Wichman.
Mackay said the MDOL is looking to have the general fund restored to its previous level for the purpose of funding the diagnostic lab.
"We think there is a legitimate argument for that because the lab also tests for zoonotic diseases, which can spread to humans, meaning it is not strictly an animal health lab. We are working with the governor's budget office in preparing our budget, which will be presented during the next legislative session in January, 2015.
"The best way to work through issues like this is through talking with the various groups affected and having face-to-face presentations. We have been doing that and will continue working with those groups to find a solution that will work. It's a pretty straightforward issue without many nuances, and we will continue down the road of attaining a workable solution," said Mackay.