HB1527

SECTION 1. The legislature finds that the use of cover crops increases agricultural productivity and aligns with the State's integrated sustainability goals. Plants used for this purpose, including grasses, legumes, and forbs, add nutrients to the soil, act as windbreaks, assist with water retention, provide habitats for beneficial insects, offset greenhouse gas emissions through carbon sequestration, and help to prevent soil erosion.

The legislature further finds that it is in the best interests of the State to incentivize the use of management practices that enhance the quality and sustainability of Hawaii's agricultural lands.

Accordingly, the purpose of this Act is to establish and appropriate moneys for a cover crop reimbursement pilot program to reimburse farming operations in the State for the costs of cover cropping.

SECTION 2. (a) The department of agriculture shall establish and implement a three-year cover crop reimbursement pilot program to reimburse farming operations in the State for the costs of cover cropping.

(b) Applications for cost reimbursements shall be submitted on a form furnished by the department of agriculture and shall be accompanied by documentation of the costs incurred, pursuant to subsection (c); provided that:

(1) The applicant shall indemnify and hold harmless the State and its officers, agents, and employees from all claims arising out of or resulting from cover cropping; and

(2) The department may request that an applicant provide additional information for the purposes of verifying the costs claimed are directly related to cover cropping.

(c) Applications for reimbursement under the cover crop reimbursement pilot program shall be filed for costs incurred within the fiscal year immediately preceding the filing and be effective for the costs of cover cropping incurred after June 30, 2022, and before July 1, 2025. The documentation shall include a certification that the amount for which the applicant seeks reimbursement is not already covered by other governmental cover crop incentive programs, including the Natural Resources Conservation Service's environmental quality incentive payment program or the conservation stewardship program.

(d) Reimbursement for cover cropping costs incurred after June 30, 2022, and before July 1, 2025, shall be as follows:

(1) For a single-species cover crop, the farmer or rancher shall be reimbursed $ multiplied by the number of acres upon which the cover crop is planted; or

(2) For a multi-species cover crop, the farmer or rancher shall be reimbursed $ multiplied by the number of acres upon which the cover crop is planted.

(e) Funds shall be disbursed by the department to the farmer or rancher based on the 2017 National Agricultural Statistics Service typology of farm size as follows:

(1) Sixty-three per cent to farms and ranches of up to ten acres;

(2) Twenty-seven per cent to farms and ranches of ten acres and up to fifty acres;

(3) Six per cent to farms and ranches of fifty acres and up to one hundred eighty acres;

(4) Two per cent to farms and ranches of one hundred eighty acres and up to five hundred acres;

(5) One per cent to farms and ranches of five hundred acres and up to one thousand acres; and

(6) One per cent to farms and ranches of one thousand or more acres.

(f) The department shall aggregate the total reimbursement applications pursuant to this section and divide and distribute the available moneys on a first come, first served basis; provided that no farming operation shall receive a total reimbursement of more than $ per year.

(g) There is established within the department a cover crop reimbursement pilot program manager position, which shall be a full-time temporary position exempt from chapters 76 and 89, Hawaii Revised Statutes. The cover crop reimbursement pilot program manager shall receive a salary not to exceed $50,000 per year. The cover crop reimbursement pilot program manager shall possess a requisite level of knowledge and expertise in the area of program management necessary to carry out the duties of the position. The cover crop pilot reimbursement program manager shall:

(1) Facilitate the division and distribution of available moneys for reimbursement; and

(2) Manage the day-to-day coordination of the cover crop reimbursement pilot program.

(h) Any action taken by the department pursuant to this section shall be exempt from the rulemaking requirements of chapter 91, Hawaii Revised Statutes.

(i) The department shall submit a report on the cover crop pilot reimbursement program to the legislature no later than twenty days prior to the convening of the regular sessions of 2023, 2024, and 2025. The report shall include:

(1) The number of acres of land upon which cover crops are grown under the pilot program;

(2) The total amount spent by the pilot program, broken down by category; and

(3) The department's recommendation on whether the pilot program should be extended, with or without modifications.

(j) As used in this section:

"Cover crop" means the plants listed in the cover crop database maintained by the University of Hawaii college of tropical agriculture and human resources.

"Department" means the department of agriculture.

"Farming operation" has the same meaning as in section 165‑2, Hawaii Revised Statutes.

SECTION 3. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2022-2023 for the department of agriculture to establish, implement, and administer a cover crop reimbursement pilot program; provided that up to $20,000 may be used for administrative costs.

The sum appropriated shall be expended by the department of agriculture for the purposes of this Act.

SECTION 4. This Act shall take effect on July 1, 2022.

INTRODUCED BY:	_____________________________

HOUSE OF REPRESENTATIVES	H.B. NO.	1527
THIRTY-FIRST LEGISLATURE, 2022
STATE OF HAWAII