An Act To Expand the Local Foods Economy
Maine Legislature, Session 127, LD 1284
Committee: Agriculture, Conservation and Forestry
Sponsors: JOHNSON, HICKMAN, DILL, SAVIELLO, CHAPMAN, MAREAN
Amends: 7 MRSA §306-A, 7 MRSA §434, 7 MRSA §435, 10 MRSA §1023-J

Legislative Document 
No. 1284 
S.P. 459 
In Senate, April 9, 2015 
An Act To Expand the Local Foods Economy 
Reference to the Committee on Agriculture, Conservation and Forestry suggested and 
ordered printed. 
HEATHER J.R. PRIEST 
Secretary of the Senate 
Presented by Senator JOHNSON of Lincoln. 
Cosponsored by Representative HICKMAN of Winthrop and 
Senators: DILL of Penobscot, SAVIELLO of Franklin, Representatives: CHAPMAN of 
Brooksville, MAREAN of Hollis. 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  7 MRSA §306-A, sub-§2, as enacted by PL 1999, c. 72, §5, is amended to 
read: 
2.  Fund operation.  The commissioner shall utilize the agricultural development 
fund to: 
A.  Provide grants to individuals, firms or organizations to conduct market research 
or to undertake market promotion activities for the purpose of expanding existing 
markets and developing new markets for state agricultural products; and 
B.  Test and demonstrate new technologies related to the production, storage and 
processing of state agricultural commodities.; and 
C.  Provide local foods grants to Maine-based individuals, firms or organizations 
under section 320-B, subsection 1 to conduct market feasibility studies, in diverse 
geographic areas of this State if possible, to identify the demand for and pricing, 
logistical parameters and availability of minimally processed fresh foods grown in 
this State and of seafood grown or harvested in this State for local food purveyors and 
aggregated and institutional markets, including school food service programs. 
Sec. 2.  7 MRSA §306-A, sub-§3, as amended by PL 2013, c. 64, §1, is further 
amended to read: 
3.  Rulemaking.  The commissioner shall establish, by rule, in a manner consistent 
with Title 5, chapter 375, subchapter 2-A criteria for the allocation of grant money, 
application requirements consistent with the provisions of this section and section 320-B, 
a schedule for accepting and reviewing applications, reporting requirements on grant 
expenditures and project results and any other administrative requirements necessary for 
the efficient implementation of this program.  Rules adopted pursuant to this subsection 
are major substantive rules as defined in Title 5, chapter 375, subchapter 2-A.  The 
commissioner is guided by the following criteria: 
A.  Applications may be submitted by individuals, firms or organizations in response 
to a request for proposals for competitive grants. The commissioner may also contract 
directly with individuals, firms or organizations for a special project under section 
307; 
B.  A percentage of the total cost of any project must be funded by the applicant or 
applicants and a percentage of the total cost must be funded from nonpublic sources.  
These percentages must be established by rule.  A single grant may not exceed 50% 
of the total funds available to be granted in a given year; 
C.  Information relative to market research or development activities provided to the 
commissioner prior to formal application, included in grant applications or provided 
to the commissioner to fulfill reporting requirements is confidential information and 
may not be publicly disclosed by the commissioner as long as: 
(1)  The person to whom the information belongs or pertains has requested that 
certain information be designated as confidential; and 
(2)  The commissioner has determined that the information gives the person 
making the request opportunity to obtain business or competitive advantage over 
another person who does not have access to the information or will result in loss 
of business or other significant detriment to the person making the request if 
access is provided to others; and 
D.  When possible, the commissioner shall award grants to applicants representing 
diverse agricultural enterprises and geographic areas of the State.; and 
E.  The commissioner shall consider administrative requirements necessary for local 
foods grants under section 320-B, subsection 1, including a definition of "minimally 
processed foods," the allocation of grant funds, application requirements consistent 
with the provisions of chapter 10-C, a schedule for accepting and reviewing 
applications and reporting requirements on grant expenditures and project results. 
Sec. 3.  7 MRSA c. 10-C is enacted to read: 
CHAPTER 10-C 
LOCAL FOOD INFRASTRUCTURE PROGRAM 
§320-A.  Definitions 
As used in this chapter, unless the context otherwise indicates, the following terms 
have the following meanings. 
1.  Local food.  "Local food" means food produced or harvested by a Maine food 
producer as defined by section 212, subsection 2. 
§320-B.   Local food infrastructure program; grants and loans 
The commissioner shall issue grants under section 306-A for the purpose of 
conducting market feasibility studies and developing business plans for local food 
infrastructure operators in this State to connect and enhance relationships between fresh 
food producers in this State and aggregated and institutional markets, including school 
food service programs, and purveyors.  The commissioner shall issue low-interest loans 
under subsection 2 and section 435 for the development and operation of local food 
infrastructure operators in this State based on how well the local food infrastructure 
operators' business plans, as reflected in competitive applications, serve to connect and 
enhance relationships between fresh food producers in this State and aggregated and 
institutional markets, which may include school food service programs, and purveyors. 
1.  Local foods grants. The commissioner shall award at least one grant each of no 
more than $30,000 to applicants based in this State to conduct market feasibility studies 
and develop business plans for local food infrastructure.  An applicant must demonstrate: 
A.  The capacity to research aggregated and institutional markets' demand for and 
pricing, logistical parameters and availability of fresh and minimally processed foods 
produced in this State; and 
B.  Expertise related to the market feasibility study and the capacity to create and 
implement business plans for local food aggregation, minimal processing, 
distribution, livestock or poultry processing, grain testing, malting or other local food 
infrastructure located in this State if the applicant is applying for a local food 
infrastructure loan under subsection 2. 
The intent of a market feasibility study and business planning process supported by grant 
funds must be to serve local farms.  A business plan must be crafted to maximize the 
benefits to farms that supply the local food infrastructure operation and to minimize, if 
not remove, any negative effects of a new local food infrastructure operation on existing 
farm operations.  A business plan must leverage strategically important shared 
infrastructure to support expansion of agriculture and the value farmers receive for their 
work.  A business plan must seek to provide benefits such as increasing production 
capacity, creating new jobs and providing new food processing capabilities that meet a 
significant local demand.  An application must receive a higher ranking if it leverages 
producer operations that provide good stewardship of the land as a natural resource or if 
the business plan advances development of a simple food chain with a short distance 
between the producer and the consumer.  The commissioner may not award a grant under 
this subsection to an applicant unless matching funds from the applicant are available in 
an amount that is no less than 50% of the grant amount. 
2.  Local food infrastructure loans.  The commissioner shall award local food 
infrastructure loans from the Agricultural Marketing Loan Fund established under Title 
10, section 1023-J in accordance with the provisions of section 435 to applicants in 
diverse geographic areas of the State for the purpose of establishing local food 
infrastructure operations in this State.  Prior to awarding a loan under this subsection, the 
commissioner shall determine that the potential overall impact of the application to the 
agricultural economy and agricultural industry in this State is beneficial to and in the best 
interest of the agricultural industry and well-being of the State.  Applications for loans 
under this subsection must include business plans that examine economic impacts and are 
based on the market studies completed under subsection 1 or equivalent market 
knowledge.  An application must demonstrate: 
A.  That the application is based on sound business and financial principles; 
B.  That the application has a plan to leverage strategically important shared 
infrastructure to support expansion of agriculture and the value farmers receive for 
their work; 
C.  That the application seeks to provide benefits such as increasing production 
capacity, creating new jobs and providing new food processing capabilities that meet 
a significant local demand; 
D.  That the applicant is able to locate and obtain food from growers based in this 
State and, where feasible, fisheries in this State, and has the capacity to handle the 
logistics of adding value to those foods or supplying and delivering those foods as 
ordered by food purveyors or aggregated and institutional markets, which may 
include school food service programs; 
E.  That the applicant has the capacity to provide fresh food or minimally processed 
food sourced in this State; 
F.  That the applicant has knowledge of health-oriented food production methods in 
order to maintain nutritional value and minimize food contaminants; 
G.  That the applicant will exercise sustainable waste management practices, 
including composting of food waste and minimal use of disposable nonreusable 
packaging materials; 
H.  That the applicant has the ability to encourage food producers to plant or 
otherwise scale capacity to meet anticipated food service demand; 
I.  That the applicant has a willingness to work cooperatively with other local food 
infrastructure operators in this State to meet statewide demand for fresh food sourced 
in this State in a cost-effective manner; and 
J.  That the applicant has an ownership or governance structure that inherently holds 
in high regard the value provided to the producer.  Examples of such an ownership or 
governance structure include, but are not limited to, an entity that is a cooperative of 
fresh food producers in this State and an entity whose bylaws require a majority of 
the board of directors to be fresh food producers in this State. 
3.  Maine Food Infrastructure Advisory Committee.  The commissioner shall 
establish the Maine Food Infrastructure Advisory Committee.  The commissioner shall 
include representatives of statewide and regional organizations involved in supporting 
agriculture, public health, the environment and the state economy as part of the advisory 
committee.  The advisory committee shall: 
A.  Advise the department on definitions and the implementation and evaluation of 
applications for grants and loans under this section and shall review project results; 
and 
B.  Advise the Department of Education on design and evaluation of a local foods 
training program. 
The commissioner shall, as applicable, consult with the Department of Marine 
Resources regarding the awarding of grants and loans under this section. 
Sec. 4.  7 MRSA §434, sub-§1, as amended by PL 2001, c. 152, §1, is further 
amended to read: 
1.  Agricultural enterprise.  "Agricultural enterprise" means a person or business 
located in this State and engaged in the commercial growing or harvesting of plants; 
raising of animals; growing or obtaining plant or animal by-products; aquaculture, as 
defined in Title 12, section 6001, subsection 1; or further processing, storing, packaging 
or marketing a raw product derived from plants, animals, plant or animal by-products or 
aquaculture, as defined in Title 12, section 6001, subsection 1, with the intent that the 
product be sold or otherwise disposed of to generate income.  "Agricultural enterprise" 
includes a business or activity that attracts visitors to a farm for the purpose of 
supplementing income from the primary crop or livestock operation or that is a local food 
infrastructure operation, pursuant to chapter 10-C.  "Agricultural enterprise" does not 
include a business engaged primarily in the growing, harvesting or further processing of 
forest species of trees for the purpose of producing pulp or other materials used in the 
paper manufacturing or wood manufacturing process. 
Sec. 5.  7 MRSA §435, sub-§2, ¶A, as amended by PL 2003, c. 168, §1, is further 
amended to read: 
A.  An agricultural marketing loan for any project under this subchapter or section 
320-B, subsection 2, the total cost of which exceeds $100,000, may not exceed 75% 
of the project cost.  A loan from the fund may not be provided for such a project 
unless the applicant demonstrates a commitment of private funds of at least 5% of the 
total cost of the project; except that, in order to encourage the undertaking of 
cooperative projects by 2 or more agricultural enterprises, an agricultural marketing 
loan may not be provided unless the cooperating agricultural enterprises as a group 
demonstrate a commitment of private funds of at least 5% of the total cost of the 
project. 
Sec. 6.  7 MRSA §435, sub-§2, ¶B, as amended by PL 2003, c. 168, §1, is further 
amended to read: 
B.  An agricultural marketing loan for any project under this subchapter or section 
320-B, subsection 2, the total cost of which is $100,000 or less, may not exceed 90% 
of the total cost of the project. 
Sec. 7.  7 MRSA §435, sub-§2, ¶J is enacted to read: 
J.  When considering a local food infrastructure loan under section 320-B, subsection 
2, the commissioner must be guided by the criteria established in chapter 10-C. 
Sec. 8.  10 MRSA §1023-J, first ¶, as amended by PL 2011, c. 380, Pt. OOO, §1 
and c. 657, Pt. W, §6, is further amended to read: 
The Agricultural Marketing Loan Fund, referred to in this section as the "fund," is 
created.  The fund must be deposited with and maintained by the Finance Authority of 
Maine.  The fund must be administered by the Commissioner of Agriculture, 
Conservation and Forestry in accordance with Title 7, chapter 101, subchapter 1-D.  All 
money received by the Finance Authority of Maine from any source for the development 
and implementation of an improved agricultural marketing loan program must be credited 
to the fund.  Any money credited to the fund from the issuance of bonds on behalf of the 
State for financing loans for agricultural enterprises may be used only for the following 
purposes:  to provide assistance to agricultural enterprises in this State for the design, 
construction or improvement of commodity and storage buildings and packing and 
marketing facilities; for the purchase, construction or renovation of buildings, equipment, 
docks, wharves, piers or vessels used in connection with a commercial agricultural 
enterprise; for the purchase of land in connection with development of new cranberry 
acreage; for the purchase of land for irrigation reservoirs or to provide direct access to 
water for irrigation; for the purchase of land necessary for the start-up of a new 
agricultural enterprise; for the expansion of an existing agricultural enterprise when the 
land acquisition is necessary to comply with land use regulations; for the development of 
a business plan in accordance with the provisions of Title 7, section 436-A establishing 
local food infrastructure operations pursuant to Title 7, chapter 10-C; for improvements 
to pastureland, including seeding and actions to promote rotational grazing; or, if the 
commissioner so approves at the time of loan insurance commitment, to pledge money in 
the fund as security for, and to apply money in the fund to, payment of principal, interest 
and other amounts due on any term loans insured by the Finance Authority of Maine to an 
eligible dairy farmer.  Repayment of these loans and interest on these loans must be 
credited to the fund and may be used for the purposes stated in this section or Title 7, 
section 436.  Interest earned on money in the fund and interest earned on loans made 
from the fund may be used to pay the administrative costs of processing loan applications 
and servicing and administering the fund and loans and grants made from the fund since 
the inception of the agricultural marketing loan program, to the extent that these costs 
exceed the fee for administrative costs established by Title 7, section 435, subsection 4. 
Sec. 9.  Advisory committee; pilot program.  The Maine Food Infrastructure 
Advisory Committee established in accordance with the Maine Revised Statutes, Title 7, 
section 320-B, subsection 3 must include to the extent possible, but is not limited to, 
representatives of the member entities of the farm-to-school work group established by 
Resolve 2009, chapter 106.  The Commissioner of Agriculture, Conservation and 
Forestry may establish a local food infrastructure pilot program if insufficient funding is 
available from the Agricultural Marketing Loan Fund under Title 10, section 1023-J for 
the local food infrastructure program under Title 7, chapter 10-C.  The Maine Food 
Infrastructure Advisory Committee shall prepare and submit an evaluation of the overall 
effectiveness of the pilot program to the Department of Agriculture, Conservation and 
Forestry, the Department of Education and the Department of Marine Resources within 
days following the completion of the pilot program. 
SUMMARY 
This bill requires the Department of Agriculture, Conservation and Forestry to 
administer programs to support the expansion and coordination of the use of fresh Maine 
foods in aggregated and institutional markets, including school food service programs. 
The Department of Agriculture, Conservation and Forestry is directed to provide 
grants under the agricultural development grant program for the purpose of conducting 
market feasibility studies and developing business plans for local food infrastructure 
operations in Maine to connect and enhance relationships between fresh food producers 
in Maine and aggregated and institutional markets, including school food service 
programs, and food purveyors.  The Commissioner of Agriculture, Conservation and 
Forestry may not award a local foods grant unless the applicant provides matching funds 
in an amount that is no less than 50% of the grant amount. 
The department is also directed to provide loans under the Agricultural Marketing 
Loan Fund to applicants in diverse geographic areas in the State for the purpose of 
establishing local food infrastructure operations located in Maine.  Prior to awarding a 
local food infrastructure loan, the Commissioner of Agriculture, Conservation and 
Forestry is required to determine that the potential overall impact of a proposal on 
Maine's agricultural economy and industry is beneficial to and in the best interest of the 
State. 
The bill also establishes the Maine Food Infrastructure Advisory Committee, which 
includes representatives of statewide and regional organizations involved in supporting 
agriculture, public health, the environment and the state economy, including 
representatives of the member entities of the farm-to-school work group established by 
Resolve 2009, chapter 106.