DEPARTMENT OF AGRICULTURE FY 2021-22 JOINT ......6-Jan-2021 AGR-hearing 2:30-2:45 DEPARTMENT OF AGRICULTURE FY 2021-22 JOINT BUDGET COMMITTEE HEARING AGENDA Monday, January 25, 2021

6-Jan-2021 AGR-hearing

2:30-2:45

DEPARTMENT OF AGRICULTURE FY 2021-22 JOINT BUDGET COMMITTEE HEARING

AGENDA

Monday, January 25, 2021 (Rescheduled from January 6, 2021) 3:30 pm – 4:30 pm

INTRODUCTIONS AND OPENING COMMENTS

Presenter: Kate Greenberg, Commissioner

2:45-2:55 COMMON QUESTIONS

Main Presenters:

● Kate Greenberg, Commissioner

● Jill Schnathorst, Chief Financial Officer

Topics:

● Implementation of FY 2020-21 HLD Decrease: Pages 1-2, Question 1 in the packet, Slide 6

● COVID-19 Changes: Page 2, Question 2 in the packet, Slide 6

2:55-3:10 SUMMARY OF THE FY 2020-21 APPROPRIATION AND FY 2021-22

REQUEST

Main Presenters:


● Jill Schnathorst, Chief Financial Officer

Topics:

● R-01 Agricultural Climate Resilience Office: Pages 3-4, Questions 3-4 in the packet, Slide 9o Soil Health Program: Pages 3-4, Questions 3-4 in the packet, Slide 9

● R-02 Industrial Hemp Enforcement FTE: Pages 5-6, Questions 5-8 in the packet, Slide 9o Hemp seeds, plants, and THC level thresholds: Pages 5-6, Questions 5-8 in the packet,

Slide 9

● Agricultural Management Fund: Pages 6-8, Questions 9-10 in the packet, Slide 12

3:10-3:30 THE AGRICULTURE ECONOMY AND OTHER DEPARTMENT

RELATED GENERAL QUESTIONS

Main Presenters:


● Tom Lipetzky, Markets Division Director

Topics:

● Economic outlook and support for agricultural industry: Pages 8-10, Questions 11-12 in thepacket, Slides 13-20

● Communities of color in agriculture: Pages 10-11, Question 13 in the packet, Slide 18

6-Jan-2021 1 AGR-hearing

DEPARTMENT OF AGRICULTURE

FY 2021-22 JOINT BUDGET COMMITTEE HEARING AGENDA

Wednesday, January 6, 2021

2:30 pm – 3:30 pm

COMMON QUESTIONS FOR DISCUSSION AT DEPARTMENT HEARINGS

1. Please describe the Department's actions to implement the Health, Life, and Dental decrease in

lieu of a 5.0 percent General Fund salary base reduction. Please include dollar and percentage

share data on planned "allocations" of the decrease to all divisions and programs within the

Department. Please describe the use of vacancy savings, delayed hiring, and the implementation

of one-time or ongoing operating savings. Please describe the urgency of the Department's need

to engage in a furlough in FY 2020-21 due to the inability to achieve savings in other ways.

In order to implement the reduction to the Health, Life and Dental (HLD) appropriation, the

Department utilized a number of strategies including holding vacancies for a longer period of time,

adjusting operating expenses, and refinancing portions of positions with federal grants. The table

below shows the impacted divisions, amounts, and the type of adjustment made.

Colorado Department of Agriculture - Summary of Health, Life and Dental Decrease Implementation

Division Reduction Share

Percentage Summary

Inspection and

Consumer Services

Division

($74,607) 22% $24,607 from operating, $50,000 from one-time

federal grant refinancing

Animal Health Division ($49,607) 14% $24,607 from operating, $25,000 Animal Health

Laboratory staff refinancing

Plants Division ($109,607) 32% $24,607 from operating, $85,000 from Deputy

Plants Director Vacancy - holding for entire year

Markets Division ($34,607) 10% $24,607 from operating, $10,000 from hiring

position at lower class and promoting at a later time

Conservation Division ($34,607) 10% $34,607 from Personal Services vacancies

Commissioner's Office ($42,249) 12% $42,249 from Personal Services, backfilling with

Agriculture Management Fund one-time

Total ($345,284) 100%


Finally, in addition to the adjustments mentioned above, the Governor and executive branch Agencies

agreed that the best way to achieve a fair and equitable pathway for all Agencies to meet the FY 2020-

21 statewide reduction goal for balancing efforts was through a furlough plan. It was estimated

furloughs would save approximately $46,356 General Fund at CDA.The state’s furlough plan is targeted

and more limited than most other businesses and governments. Many businesses and municipalities

have shortened hours, implemented 5-10 day furloughs, or even laid off employees. About half of state

employees were exempted from the furloughs, and most employees only have 1-2 days.

2. Please describe how the changes implemented in response to the COVID-19 pandemic have

changed the nature of the Department’s work. Please address programmatic, budgetary, and

office space impacts.

Programmatic: CDA programs have continued to operate effectively with limited interruptions.

Employees have been innovative partners in looking at business processes and adapting to remote

work while limiting in-person trips to the office. We are continuing to develop and examine additional

opportunities to transition our internal process and customer services to virtual and electronic formats.

Our inspection and field work has been impacted due to contact with the general public and other

business entities. Critical inspections to keep commerce moving have continued without pause. In

some cases, virtual inspections have been implemented or inspections have been postponed until a

safer environment exists for their completion.

Budgetary: In responding to the COVID-19 pandemic, the Department saw a number of changes to its

budget that allowed it to utilize resources to better support staff working from home or safely in the

field. CDA strategically used the pandemic as an opportunity to transform State Government for the

better, taking advantage of opportunities to build a more engaged workforce, have lower overhead,

and provide services that can be accessed online. Given travel restrictions, many training or other trips

were canceled or rescheduled which created savings in the budget. In some programs, this savings was

repurposed to support staff working from home by moving some processes to electronic platforms,

buying laptops and other equipment necessary to adapt at home. Funding was also repurposed to

supply Personal Protective Equipment (PPE) in the field in order to keep staff safe while completing

inspections and continuing to support the food supply chain.

Office space: At this time changes to office space have been of a temporary nature in response to the

pandemic with the primary change being minimal staff on-site and only on an as-needed basis.

Permanent changes to office space are being considered as we look at post-pandemic and what our

future on-site workforce looks like. It is important to note that approximately one-half of the CDA

workforce has been, and will continue to be, remote or field based with support-based functions from

the central or field offices.


FY 2021-22 BUDGET REQUESTS

R-01 AGRICULTURAL CLIMATE RESILIENCE OFFICE (ACRO)

3. [Sen. Hansen]: We understand that the Department created a new soil health program based on

private funding. Identify the statutory provision(s) that authorize the Department to do so.

Work to enhance soil health or soil quality at the Colorado Department of Agriculture (CDA) is

accomplished through the Colorado State Conservation Board (CSCB) operationally housed within CDA’s

Conservation Services Division. The CSCB assists conservation districts in the conservation of soil and

water resources. Soil health and initiatives for the conservation of soil and water resources are not new

and have been undertaken since the creation of the CSCB and conservation districts after the dust bowl.

The Colorado Department of Agriculture recently signed a five-year, $5 million agreement between the

USDA Natural Resources Conservation Service (NRCS) and the CSCB to advance soil health and the

conservation of soil and water resources. Additionally, the Department is exploring opportunities to

expand this work with the support of foundations and other funding partners. For example, the Gates

Family Foundation has provided a $125,000 grant over two years and we are seeking a matching

Environmental Protection Agency (EPA) section 319 grant to bring the Saving Tomorrow’s Agricultural

Resources (STAR) program to the state. The STAR program offers farm operators and landowners a tool

to evaluate their soil management practices. These grants were accepted under the authority in 35-1-

104(1)(dd) C.R.S.

The agreement creates new employee roles to bring voluntary conservation and regenerative

agricultural assistance programs for agricultural producers to incorporate into their operations.

Specifically, the funding will provide 75% support for 25 existing conservation district jobs, and fund new

CSCB conservation positions geographically distributed throughout the state. The agreement expands

funding for existing conservation technical assistance jobs and will eventually add five new positions to

support the CSCB’s work to improve soil health and the conservation of soil and water resources.

Further, it will create an Urban Agricultural Specialist position to help small urban and peri-urban

agricultural operations implement soil conservation practices and boost production. The distribution of

funds by the State Conservation Board is done under the authority in 35-70-103(5)(g) C.R.S. This net-

zero request aligns with the Agency’s third Strategic Priority: promoting and incentivizing soil, water,

and climate stewardship.

The relevant statutory authorities are listed below:

35-1-104(1)(dd) - (State Department of Agriculture Act of 1949)

For each division, section, program, or established funding source of the department, to solicit, receive,

and spend grants, donations, and gifts. Such moneys shall be transmitted to the state treasurer, who

shall credit the same to the particular cash fund or established funding source deemed most appropriate

by the department.

35-70-103(5)(g) - (Colorado Soil Conservation Act)

To administer and disburse any funds that may be made available to the state board for the purpose of

assisting conservation districts in the conservation of soil and water resources of the state of Colorado


and to defray expenses of the state board and its duly appointed or employed agents in carrying out the

provisions of this article;

4. [Sen. Hansen]: Describe the Department’s plan for creating and sustaining the proposed

programs. How does this proposal fit within the Climate Roadmap?

Advancing Colorado’s Renewable Energy and Energy Efficiency (ACRE3):

The Colorado Department of Agriculture will seek to reinstate a $500,000 tier II severance fund tax

transfer that expired in 2017. The Department worked with the legislature to bring forward legislation

last session that would have reinstated the funding. Due to the uncertain budget situation the sponsors

decided to pull that proposal last session and agreed to work with the Department to bring it forward

this session. The reinstatement of funding will be part of the legislation that the Department will seek

this session for creating the Agricultural Climate Resilience Office (ACRO). The programs stemming from

this Office will be driven to help achieve the Governor’s targeted emission reductions needed to

confront the climate crisis.

As part of the legislation, the Department will ask for authority for the ACRO to administer voluntary,

incentive based agricultural climate programs in a broader way than it has authority to do now. This

structure will position the Department to be able to accept and request State funding as well as bring in

additional dollars such as those from programs administered by the USDA. It is anticipated that with the

transition in presidential administrations there will be a greater focus nationally on addressing climate

change through the agricultural sector.

Soil Health Initiatives of the Colorado State Conservation Board:

The Colorado Department of Agriculture signed a five-year, $5 million agreement between the USDA

Natural Resources Conservation Service and the Colorado State Conservation Board. The agreement

provides 75% support for 25 existing conservation district jobs, and funds new Colorado State

Conservation Board conservation positions. The Department is exploring additional opportunities to

expand this work with the support of foundations and other funding partners. For example, the Gates

Family Foundation has provided $125,000 over two years and we are seeking a matching EPA section

319 grant to bring the Saving Tomorrow’s Agricultural Resources (STAR) program to the state. The STAR

program offers farm operators and landowners a tool to evaluate their soil management practices.

Climate Roadmap:

Improving soil health has the ability to increase the amount of carbon sequestered in the soil and

increase yields while reducing fossil fuel-intensive inputs. Increasing soil health on Colorado’s working

lands through voluntary, incentive-based programs is a vital component of addressing Greenhouse Gas

Emissions (GHGs) while advancing Colorado agriculture. Increased energy efficiency and use of on farm

renewables reduce energy costs and GHG emissions in agricultural production. Supporting the adoption

of soil health practices, increasing the energy efficiency of agricultural operations, and growing the use

of renewable energy in the agriculture sector are integrated into the Colorado Greenhouse Gas Pollution

Reduction Roadmap.


R-02 INDUSTRIAL HEMP ENFORCEMENT FTE

5. [Rep. Ransom] If a grower only purchases certified seeds, why would the resulting product have a

THC level that exceeds the allowable threshold?

Planting Certified Hemp Seed is not mandated, and its availability is currently limited. Hemp seed that is

Certified must have had numerous years of genetic improvement and breeding research behind it and

meet national standards, therefore the amount of Certified seed available increases slowly every year.

Planting certified seed will help ensure good germination, genetic traits, and lower THC rates. The risk of

non-compliant THC exceedance is greatly diminished when using Certified Seed; however, considering

the current available varieties there is no guarantee that any cannabis plant will not exceed a particular

THC level. Other factors may come into play such as timing of crop harvest (the more mature a crop the

greater the THC content), weather/temperature, soil conditions, and inputs or amendments added to

the plant. The last days before harvest in particular often see a dramatic increase in plant THC levels and

the threshold of compliance of 0.3% THC can easily be exceeded in a short period of time. There is still a

lot that needs to be done regarding research and development of viable genetics.

6. [Rep. Ransom] If a grower is not compliant in terms of hemp THC levels, why are they required to

destroy the crop? Could the grower pass the product on to another vendor to sell as a legal

marijuana product?

Hemp is an agricultural crop and it is important to maintain its distinction from marijuana to ensure the

integrity of the hemp industry. Per rule 5.2, “Notwithstanding the fact that a sample of a Commercial

Registrant’s Industrial Hemp tests higher than 0.3% but less than 1.0% delta-9 THC concentration the

Registrant shall not be subject to revocation or suspension of their Registration if the crop is destroyed

or utilized on site in a manner approved of and verified by the Commissioner”. CDA’s policy is that the

crop may not leave the farm, be consumed, or enter the stream of commerce. The grower must provide

visual evidence that the crop has been rendered unrecognizable to CDA. Any commercial cultivation,

transfer, manufacturing, testing, distribution, or sale of marijuana in Colorado requires a license issued

by the Department of Revenue Marijuana Enforcement Division and approval by the relevant local

jurisdiction; further, all commercial marijuana needs to originate within the closed-loop system and be

tracked in the inventory tracking system until the point of sale. These requirements, among other

requirements and restrictions in statute and rule, are reasons a hemp grower cannot transfer their

inventory that turns out to be marijuana to a licensed marijuana business.

7. [Rep. Ransom] If plants are fertilized naturally (e.g., bees), how does that impact the THC

standards they are required to follow?

Cross pollination can influence THC traits of crops located several miles away from each other. Cannabis

plants can be pollinated by wind and/or by bees. Cross pollination occurs when pollen from one variety

fertilizes a different variety via wind or insects. In Marijuana, cross pollination could lead to a decrease

in THC content, impacting marketability having seeds in smokable flowers and profit. This is of

particular concern in Pueblo County where both outdoor hemp and marijuana cultivation are allowed.

Currently the state does not require a distance between cultivation sites, however local governments

may have stricter limitations. National Certified Hemp Seed standards, however, do require a

separation distance of 6 miles between a seed Certification field and other fields. Every time a producer


labels seeds as Certified, that seed must have been grown on fields in Colorado that are under the

purview of the Colorado Seed Growers Association. They are inspected in the field each year for quality,

uniformity and presence of diseases, insects and weeds. The harvested seed is tested by Colorado State

University seed lab, as well as CDA for THC levels, and only if it passes the National standards is a label

issued. This happens every year the seed is Certified.

8. [Sen. Rankin] Describe the Colorado hemp industry, and how fast it is growing (e.g., acreage,

number of producers, geographic locations, required water usage, value of the crop, etc.)?

Colorado’s hemp program grew from 1,811 registered acres and 131 registrants in 2014 to 88,743

registered acres and 2,600 registrants in 2019 following the passage of the 2018 Farm Bill

decriminalizing hemp. However, in 2020 there was a dramatic market correction nationwide reducing

the acres and number of producers by roughly 50%. Even with this significant decline in hemp

production, Colorado still leads the nation in acres registered and planted.

Colorado’s hemp industry has strong potential to speed up the state’s economic recovery. 58 of 64

Colorado counties have hemp production during the 2020 season. The most hemp production occurs in

Mesa, Delta, and Montrose counties on the western slope, Saguache county in the San Luis Valley, and

Larimer, Weld, Morgan, Adams, El Paso, Pueblo, Otero, and Baca counties in eastern Colorado.

There is widespread claim that hemp uses less water than most agricultural crops like corn. However,

due to diverse cropping patterns more research needs to be done to verify those claims. For example,

hemp grown mostly for cannabinoids (including CBD) is often planted with more space while crops

planted for seed and fiber are more densely planted. Many growers use drip irrigation and plastic mulch

to increase water efficiency. These irrigation systems are relatively costly but can be justified by the

current market value. However, the market value fluctuates on a regular basis and has gone down

recently due to last year’s market correction. Jason VonLembke of the Subsurface Irrigation Efficiency

Project (SIEP) in Kersey is quoted as saying “Prior to hemp we believed alfalfa was one of the most

valuable cash crops because you can get about $130 to $140 a ton for it. But we can sell our hemp

flower at $35 a pound.” That is the equivalent of $70,000 per ton”. (December 2019).

R-03 BUDGET AND OPERATIONAL EFFICIENCIES

9. [Sen. Moreno]: The Unclaimed Property Tourism Promotion Trust Fund is designated as one of

the fund sources that comprises the State’s TABOR emergency reserve. How would the

Agricultural Management Fund (and the programs it supports) be impacted if the Governor were

to transfer the $5,000,000 that is designated as part of the TABOR reserve for purposes of a

disaster emergency?

The Department does not anticipate a significant impact to the Agriculture Management Fund (AMF) or

associated programs if $5 million is designated for disaster emergency purposes. Per 38-13-801.5 C.R.S.,

the AMF receives 65 percent and the Colorado State Fair Authority Cash Fund receives 25 percent of the

interest earned on the Unclaimed Property Tourism Promotion Trust Fund. Given the current balance of

the fund, if $5 million were transferred out, the Department anticipates the AMF would receive

approximately $26,000 less in revenue and the Colorado State Fair Authority Cash Fund would receive


approximately $10,000 less in revenue in FY 2020-21. The Department would be able to absorb this

shortfall within the current balance of the funds. As such, the Department does not expect any negative

programmatic impacts by providing one-time financial support for disaster emergency aid.

10. [Sen. Moreno]: The Agricultural Management Fund has been used recently for balancing and

refinancing purposes. How long can the Department use this fund for these purposes? Please

provide projected revenues, expenditures, and fund balances for the AMF.

The Department had some flexibility in using AMF to help with budget balancing as a result of sound

stewardship of dollars through the office consolidation and construction of the laboratory building that

were all financed through the AMF. However, the Department does not anticipate it will be able to

continue to refinance with these funds much longer as the fund is projected to decrease over time.

Please see the tables below for a forecast of the cash fund balance, revenue and expenditure.

Agriculture Management Cash Fund Summary*

Item FY 2020-21 FY 2021-22 FY 2022-23 FY 2023-24 Notes

Beginning Fund Balance $4,696,730 $3,497,874 $1,785,009 $652,062 Linked to prior year end of year balance

Estimated Revenue $2,959,472 $2,900,283 $2,842,277 $2,785,432

Forecast based on most recent year

assuming it levels off after 2 years of

drop

Revenue Transfers ($579,102) ($1,420,362) ($579,102) ($579,102)

Transfer to the State Fair. FY22

includes GF Transfer as requested

through the budget process.

Total Available Funds $7,077,100 $4,977,795 $4,048,185 $2,858,391 Sum of Revenue

Estimated Admin Item

Expenditure $1,530,312 $1,143,872 $1,347,209 $1,347,209

See Table Below. FY 23 and FY 24

include Depreciation expenditures

Estimated AMF Line Item

Expenditure $2,048,914 $2,048,914 $2,048,914 $1,511,182

Expenditures to this line will need to be

reduced in order to stay within the

projected cash fund balance

Total Expenditure $3,579,226 $3,192,786 $3,396,123 $2,858,391

End of Year Balance $3,497,874 $1,785,009 $652,062 $0

* Amounts may vary from Schedule 9 as the revenue and expenditure forecasts are reviewed and adjusted monthly.


Estimated Agriculture Management Cash Fund Expenditures

Administrative Line Items FY 2020-21 FY 2021-22 Notes

Personal Services $436,440 $0 FY21 offset GF as a budget savings measure

Health, Life Dental $196,300 $196,300

Administrative Law Judge $23,355 $23,355

Office Consolidation COP $162,920 $162,920

Adult Agriculture Leadership

Grant Program $150,000 $150,000

Indirect Cost Assessment $161,297 $161,297

Matching Grants to Conservation

Board Districts $400,000 $450,000

CDA received a small severance tax cash fund transfer this

fiscal year but anticipate no transfer over the next few years

that typically fund these grants

Capital Construction/Depreciation $0 $0 NP item that would eliminate depreciation for the year

Estimated Admin Expenditures $1,530,312 $1,143,872

OTHER DEPARTMENT RELATED GENERAL QUESTIONS

11. [Rep. McCluskie] Given the drought and some of the challenges that farmers and ranchers are

facing, please provide an update on the economic health of the state agricultural sector.

USDA’s Economic Research Service recently updated its Colorado net farm income for 2019 to $1.83

billion, a level just below the all-time high of $1.84 billion set in 2011. Reflected in these numbers are

government payments, which are contributing to over one-third of net farm income. These payments

have been critical in supporting agriculture through massive disruption, but also indicate the need to

address perennial challenges in the ag economy.

There was strong momentum coming into 2020 on the prospects of improved trade arising from the U.S.

Mexico Canada Agreement and the Phase 1 deal with China. However, with the onset of the Covid-19

pandemic, prices for many agricultural products fell as global demand weakened and consumer

purchasing behavior trended towards the retail sector. Workforce health issues also brought about

significant supply chain disruptions. Temporary closures of beef processing facilities were especially

detrimental to Colorado beef producers and with less gasoline consumption, corn producers saw prices

fall for lack of demand for ethanol.

Congress enacted Federal stimulus programs to assist agricultural producers impacted by covid-19. That

support has been unprecedented, with more than $374 million of the USDA Coronavirus Food

Assistance Program (CFAP) resources paid out to Colorado producers in 2020. Markets have also shown

some resilience since early fall providing producers, especially wheat and corn producers, an

opportunity to lock in some of the best prices in years. For example, closing wheat prices for December

15th were 33% higher than at the August 7th low. Similarly, corn prices were 35% higher than the

August 10th low and fed cattle prices, while still well below the highs of recent years, have rebounded

17% from July lows.


Small and mid-scale producers and processors, as well as local entities such as farmers markets, have

overcome substantial challenges in order to try and stay in business while in some instances struggling

to access federal relief. Many producers have seen unprecedented demand for local food and have

pivoted business models overnight. Independent meat processors are seeing demand booked out 12-18

months in advance, which is far more demand than they currently have capacity to meet; and entities

such as farmers markets have reimagined their operations to stay open for business as part of the

critical retail supply chain.

At the commodity level, given the recent strengthening of market prices and the unprecedented levels

of Federal support to the agriculture sector, Colorado net farm income for 2020 could potentially be

record high. However, the picture for 2021 looks much different. Trade disruption and coronavirus-

related payments that have brought Colorado producers nearly $500 million of support since 2018 are

not likely to be sustainable. Producers will need continued strengthening of livestock prices and

demand for wheat and corn to remain strong for farm income in 2021 to remain at or even near current

levels.

Through October, importers from 107 countries had purchased Colorado food and agricultural products

totaling $1.44 billion, a level about equal to year ago but below the $1.64 billion level for 2018. Top

importers for Colorado food and agricultural products, in descending order, are Canada, South Korea,

Mexico, Japan, and China. Beef and beef variety meats remain Colorado’s top export with $849 million

of beef exported January – October 2020. South Korea is the top buyer of Colorado beef followed by

Canada, Japan, Mexico, and Taiwan.

12. [Sen. Hansen] Are there any particular short-term measures the Department would recommend

that the General Assembly consider taking to stimulate the agricultural sector (e.g., support for

agricultural shows). Describe the expected impact on the state economy.

Through the Colorado Department of Agriculture, the Governor allocated $1.68 million in CARES Act

funds to support the Colorado Farm and Food Systems Response Team’s (CFFSRT) response and rebuild

fund. The CFFSRT is made up of 14 food systems and agricultural organizations, including the Colorado

Department of Agriculture, and is helping fill the gaps in federal aid. It was formed to respond to the

challenges and needs of agricultural producers and local food systems resulting from COVID-19. The

CFFSRT received over $5.8 million in applications for demonstrated COVID-19 related expenses and

business model pivots for producers and processors, such as developing and promoting digital consumer

storefronts, beginning or increasing direct to consumer product offerings, changing crop or livestock

production, and increasing organizational/farm capacity. The emergency funding was distributed among

all eligible applicants in December 2020.

Just like in many sectors across Colorado’s economy, the need for support in the agriculture sector far

exceeds the state’s ability to meet all of the needs. Direct financial support, infrastructure investment,

support for rural and agricultural worker health and market development are some of the needs across

the sector. In addition to allocating State aid, CDA has been working with the National Association of

State Departments of Agriculture to advocate for federal support that would benefit more Colorado

producers. CDA is still assessing the impact that the December 2020 relief package will have on

Colorado’s agricultural sector.


Direct payments, such as those made by the CFFSRT, to small and medium-sized agricultural producers

and processors for costs related to COVID-19 provides immediate financial relief and helps to stimulate

rural economies by putting those dollars to work quickly.

Additionally, language within HR 133 could potentially offer further support to bolster the industry’s

supply chain; aligning well with the Department’s proposal on grants for food processors and producers.

Section 751 of the document states, “That from the amounts provided in this section, the Secretary of

Agriculture shall use not less than $1,500,000,000 to purchase food and agricultural products, including

seafood, to purchase and distribute agricultural products (including fresh produce, dairy, and meat

products) to individuals in need, including through delivery to nonprofit organizations that can receive,

store, and distribute food items, and for grants and loans to small or midsized food processors or

distributors, seafood processing facilities and processing vessels, farmers markets, producers, or other

organizations to respond to coronavirus, including for measures to protect workers against the

Coronavirus Disease 2019 (COVID–19).”

All these efforts have served to bolster agriculture’s economy throughout the pandemic, but still, more

is needed. Investments in local and regional processing, infrastructure and distribution are more likely to

have a significant economy-wide benefit than conventional food sales.

Furthermore, supporting agricultural workers and rural mental health through culturally literate and

relationship-based initiatives helps reduce the impact of the public health crisis on our food supply chain

by keeping businesses open.

In addition, supporting local and international marketing efforts and business development is essential

to driving forward Colorado’s ag economy. Some of CDA’s international marketing efforts have shown

over time an ROI of >10:1 in terms of sales generated vs. the cost of doing the promotion. Additionally,

Colorado Proud member surveys have reported that about 74% of companies believe the program has

helped to increase sales. Of those who have increased sales, 43% reported a sales increase of 10% or

less; 41% reported an increase of 11-25%; and 16% reported an increase of more than 25%.

13. [Rep. Herod] Are there any programs within the Department that specifically address

communities of color in the agricultural industry? Please provide an overview of those programs

here.

While the Department does not currently have any programs that specifically address communities of

color in the agriculture industry, we are making concerted efforts to address inequities in agriculture

within existing programs.

CDA is working to develop its first-ever Equity, Diversity and Inclusion (EDI) roadmap and action plan to

identify opportunities to better serve our community through hiring and recruitment; outreach and

education; training; and programs and services.

We are overhauling our stakeholder outreach process to reach new communities and ensure equity of

access to participate meaningfully in the department’s processes and decision-making. This includes

outreach for better representation on boards and commissions. We are expanding relationships with

both of Colorado’s federally-recognized Tribes and the Colorado Commission on Indian Affairs as well as

Indigenous-lead organizations to enhance our consultatory relationships and explore opportunities to


drive more resources to Indigenous and Tribal producers. Our initial conversations have focused on

expanding these partnerships through our Agricultural Workforce Development Program.

Through the Colorado Department of Agriculture, the Governor allocated $1.68 million in CARES Act

funds to be distributed by the Colorado Farm and Food Systems Response Team (CFFSRT) to producers,

intermediaries and processors for COVID-19 related expenses and business model pivots. The grant

program gives additional consideration to applicants who are beginning producers; veteran producers;

Black, Indigenous, and producers of color; female producers; and LGBTQ+ producers, as those

historically underserved by public food and agriculture programs are bearing the brunt of the crisis’s

impact.

Additionally, the Laboratory Services Division Outreach program had conducted outreach and scheduled

visits from urban school programs such as the Agricultural Sciences Program at the Bruce Randolph

school in spring 2020. Due to the pandemic, the outreach program was put on hold. CDA anticipates

that this program will be restarted and expanded in the future as we continually look for creative ways

to welcome and include more people in agriculture.

January 6, 2021

1

Joint Budget Committee Hearing

Agenda• CDA Mission and Vision• FY 2020-21 Budget Adjustments• FY 2021-22 Budget Request Package• Pandemic, Drought, Wildfire, Equity in Agriculture

and the Ag Economy

January 6, 2021

2

Our Work in Context

● Access to markets/financial viability● Rural broadband● Family farm transition● Reducing barriers for next generation● Sound regulation

• Voluntary stewardship & climate resilience

• Equity & inclusion• Natural disaster response• Mental health

CDA helps advance Colorado agriculture by tackling and advocating for some of the biggest issues, such as:

January 6, 2021

3

CDA Mission & Vision

FY 2020-21 Budget Adjustments

• Health, Life and Dental 5% Personal Services General Fund budget reduction– $345,284 spread across the Divisions– $46,356 in General Fund savings from furloughs

• COVID-19 Impacts– Remote work and continued inspections

January 6, 2021

4

FY 2021-22 Budget Requests

FY 2021-22 Request● Overall increase of $1.2 M Total

Funds, $1.5M General Fund○ $1.37M Annualizations and

base adjustments○ $1.39M Total Comp and

Common Policy adjustments○ -$432k Non-Prioritized Requests○ -$1.1M Decision Items

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Budget RequestsCDA’s FY 2021-22 Budget Request includes the following:

• R-1 Agricultural Climate Resilience Office (ACRO) – $0 and 0.0 FTE – Consolidate resources under the Conservation Services

Division.

• R-2 Industrial Hemp FTE– $87,826 Cash Funds, $7,363 Reappropriated Funds and 1.0 FTE – Hire Hemp Enforcement Specialist to investigate complaints,

investigate hemp above the allowable THC limit and enforcement actions.

Budget Requests Continued• R-3 Budget and Operational Efficiencies

– $-261,942 General Fund, $-951,297 Cash Funds and -1.0 FTE

– Permanent adjustments include; – Merging leadership programs – Moving the Pet Animal Care Facility Act funding– Reducing Information Technology (IT) Asset

Maintenance appropriation – Reducing the General Fund appropriation to Divisions

with some cash fund backfill.

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Budget Requests Continued• R-3 Budget and Operational Efficiencies

continued– One-time reductions include;

– Continuation of a one-time FTE funding reduction to the State Insectary for one more year

– One-time reduction to the Agriculture Management Fund line item spending authority.

Agriculture Management Fund

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CDA Response: Pandemic, Drought, Wildfire,

Equity in Agriculture and the Ag Economy

● Ag businesses had to pivot overnight, putting strain on the ag economy from producers to farmers markets to processors

● Prices for most agricultural products fell as global demand weakened and consumer purchasing shifted almost entirely to the retail sector

● Markets have shown some resilience since early fall● Temporary closures of beef processing facilities were especially

detrimental to Colorado beef producers● With less gasoline consumption, corn producers saw prices fall for

lack of demand for ethanol

Pandemic Ag Impact

January 6, 2021

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● Coordination - Represent ag at SEOC; coordinate with stakeholders; work with USDA and industry to mitigate impacts on livestock processing

● Consistency in Service - 100% of vital services continued throughout pandemic

● Support - 20,000+ COVID-19 tests conducted at the State Fairgrounds, new CO Proud website to promote local producers

● Relief - $1,688,000 in CARES Act funds to support producers, intermediaries and processors; Colorado producers have received $374.7 million from USDA CFAP I and CFAP II programs

*Find much more detail in CDA’s COVID-19 Response 6 Mo. Review doc

Pandemic Ag Response

● 2020 is the 1st time since 2012 that 100% of the state was in drought.● Major drivers of the 2020 severe drought include: absent monsoon

seasons, accruing soil moisture deficits, record high temps and winds● Rapid and intense fire expansion in October - an unprecedented

phenomenon attributable to severe drought● Climate outlooks for 2021 indicate drought conditions are highly likely

to continue next year● By 2050, drought is likely to cost Colorado an additional $830 million in

expected annual damages, with $511 million from agricultural damages

*What happens next year if we have a weak winter??*

Drought

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● 2020 saw the three largest wildfires in the state’s history

● Drought and wildfire are intimately connected, with the former stoking conditions for the latter

● Working with federal, state, local and association partners to get resources where needed

● Leading new Ag Recovery Task Force to focus on secondary impacts

● Significant economic and personal impact on families, businesses, and natural systems

Wildfire

Burn scar and remnants of a ranch in Grand County

● Foundational issue in agriculture● Working on 1st-ever EDI roadmap and action plan, led in

coordination with EDI Committee and Senior Mgt● CARES Act relief dollars gave additional consideration to beginning,

veteran, Black, Indigenous, and producers of color; female producers; and LGBTQ+ producers as those historically underserved

● Actively supported promotora public health model for ag workers led by young farmers

● Building EDI lens into hiring, recruitment, culture, programs and services, stakeholder outreach, and self-education

● Focusing on actively building new relationships

Equity in Agriculture

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● The Ag sector had strong momentum heading into 2020 until the onset of the COVID-19 pandemic

● Colorado net farm income for 2019 was $1.83 billion, a level just below the all-time high of $1.84 billion set in 2011

● Over ⅓ of net farm income is from federal aid● $374 million of CFAP resources paid out to Colorado producers in

2020, could result in record net income● 2021 looks different - with trade and COVID payments unsustainable,

producers will need continues strengthening of prices

Bottom line: Direct payments have been essential, but we must invest in strengthening and diversifying sustainable marketplaces for CO agriculture

Economic Outlook

● Invest in ag and rural infrastructure, business & marketing, and workforce development

● Reduce barriers to the next generation, such as access to land, capital and training

● Put rural Colorado on equal footing through investments in rural broadband, telemedicine, rural roads, schools and housing

● Support advancing local and regional food systems, which support premium markets for producers, independent family businesses & system resilience

● Work toward equity in the food system

So what can we do?

January 6, 2021

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Questions


DEPARTMENT OF AGRICULTURE

FY 2021-22 JOINT BUDGET COMMITTEE HEARING

WRITTEN RESPONSES ONLY

SUMMARY: FY 2020-21 APPROPRIATION AND FY 2021-22 REQUEST

[Rep. Ransom]: Explain how soil health program fits within the mission of the proposed Agricultural

Climate Resilience Office.

The new Agricultural Climate Resilience Office (ACRO) would house the Advancing Colorado’s

Renewable Energy and Energy Efficiency (ACRE3) program and the existing Soil Health Initiative would

remain under the Colorado State Conservation Board (CSCB), which operates soil health projects in

partnership with conservation districts. ACRO would be operationally housed under the Conservation

Services Division.

The creation of the ACRO will move the funding for the ACRE3 program from the Agricultural Value

Added Development Board in the Markets Division to the Conservation Services Division where the

program staff is housed. The ACRO will create consistent management and financial structure for the

ACRE3 program. The ARCO will administer programs, such as ACRE3, that help mitigate risk and provide

technical and grant support for Colorado agriculture facing significant climate-related threats and will

help producers capitalize on related market opportunities.

The soil health initiative would continue to be administered by staff within the CSCB who also help

mitigate risk and provide technical and grant support for Colorado agriculture facing climate-related

threats. Funding for these staff would remain in the Conservation Board line item in the Long Bill and

would continue to operate under oversight from the Conservation Services Division as is done now.

Improving soil health will usually increase the amount of carbon sequestered in the soil and increase

yields while reducing fossil fuel-intensive inputs. Improving soil health on Colorado’s working lands

through voluntary incentive-based programs is a vital component of addressing Greenhouse Gas

Emissions (GHGs). Supporting the adoption of soil health practices, increasing the energy efficiency of

agricultural operations, and growing the use of renewable energy in the agriculture sector are

integrated into the Colorado Greenhouse Gas Pollution Reduction Roadmap.


COMMON QUESTIONS: PLEASE RETAIN THE NUMBERING IN ORDER TO MAINTAIN CONSISTENT LABELING FOR COMMON

QUESTIONS ACROSS DEPARTMENTS.

1 Provide a list of any legislation with a fiscal impact that the Department has: (a) not

implemented, (b) partially implemented, or (c) missed statutory deadlines. Explain why the

Department has not implemented, has only partially implemented, or has missed deadlines for

the legislation on this list. Please explain any problems the Department is having implementing

any legislation and any suggestions you have to modify legislation.

The Department does not have any legislation to report as being not implemented or partially

implemented.

2 Does the Department have any HIGH PRIORITY OUTSTANDING recommendations with a fiscal

impact identified in the Office of the State Auditor’s "Annual Report: Status of Outstanding Audit

Recommendations"? What is the Department doing to resolve these HIGH PRIORITY

OUTSTANDING recommendations? Please indicate where in the Department’s budget request

actions taken towards resolving HIGH PRIORITY OUTSTANDING recommendations can be found.

The 2020 report will be published on December 7, 2020 and can be found at this link:

http://leg.colorado.gov/content/audits. JBC staff will send out an updated link once the

report is published.

The Department has one high priority recommendation that is outstanding. The recommendation

included a five-year business plan for the Colorado State Fair. The plan continues through FY 2020-

21. CDA anticipates this item will be reported as implemented at the end of FY 2020-21.

3 For the FY 2020-21 hearing process, the Department was asked to respond to the following

questions related to public awareness campaigns.

Is the Department spending money on public awareness campaigns? If so, please describe these

campaigns, the goal of the messaging, the cost of the campaign, and distinguish between paid

media and earned media. Further, please describe any metrics regarding effectiveness and

whether the Department is working with other state or federal departments to coordinate the

campaign?

Please provide an update to your response from last year, including any changes to existing

campaigns and/or the addition or discontinuation of campaigns.

Please see the below table with updated information.


Rural Mental Health Outreach

The Colorado Department of Agriculture significantly enhanced its rural mental health awareness and outreach work in 2020, thanks to a financial gift from CoBank. CoBank learned of CDA’s initial work on rural mental health, and presented a gift to the department with the request that the funds be used to produce a video designed to bring greater awareness to the issue. CDA’s communications staff led the research and development of the video, and built a strong partnership with CDHS to leverage existing Crisis Services marketing work and create additional materials, resulting in a new toolkit, free for use by any interested stakeholder. The toolkit includes a short documentary-style video, video and radio PSAs, digital banners, posters and wallet cards. Every asset is available in both English and Spanish. The toolkit was launched in May 2020, in conjunction with Mental Health Awareness month, via a Facebook Live event featuring Governor Polis, Agriculture Commissioner Greenberg, CDHS Executive Director Barnes, and the Walter family, who is featured in the video. Reception and promotion of the new materials has been enthusiastic to say the least. In just the past seven months, the video has reached more than 115,000 people through organic social media outreach and been shown across Colorado, on national media and at large national conferences. The toolkit has been downloaded more than 60 times, including by other state departments of agriculture. Most recently, Commissioner Greenberg has been featured on Colorado Public Radio, and will appear nationally on 60 local television outlets speaking about the importance and need for rural mental health support. As momentum, interest and new connections continue to build, a new quarterly newsletter has been created, and opportunities for additional outreach strategies are being explored.

Colorado Proud

Colorado Proud: Buy Local. Grow Local.

The Colorado Department of Agriculture developed the Colorado Proud program in 1999 to promote food and agricultural products grown, raised or made in Colorado. Currently there are more than 3,000 members across the state including farmers, ranchers, food manufacturers, associations, restaurants, retailers, distributors, schools and other institutions. Members utilize the common logo that the Department then promotes to consumers, encouraging them to look for the label and buy local. The goals of Colorado Proud are to promote local food and agricultural products, increase the awareness of Colorado Proud, educate the public about Colorado agriculture and encourage consumers to buy local products labeled with the Colorado Proud logo.

In March of 2020, the Colorado Proud program quickly pivoted to support its members in response to COVID-19 and the pandemic with a “Keep Colorado Strong” campaign.


Public Relations Budget: $120,000 Source: Colorado Department of Agriculture Ag Management Fund

Colorado Proud contracted with Philosophy Communication to develop and implement a public relations campaign that would support the program’s members and encourage consumers to buy local in response to COVID-19. The program quickly launched a website, ColoradoProud.com, where members could share alternative buying opportunities for consumers during the state’s “Stay At Home” order. The website became a resource for consumers to find local products and support local businesses.

In addition, Colorado Proud hosted a series of virtual roundtables for members of the agriculture community to come together and discuss business challenges, share best practices, provide support for one another, and celebrate achievements throughout this unprecedented year. The three roundtables focused on specific geographical parts of the state and real-time topics impacting agriculture, such as: supply chain challenges, alternative distribution, direct to consumer sales strategies, labor and worker safety, weather and natural disasters including freezes, droughts and wildfires. The roundtables were attended by media, Colorado Proud members, ag industry professionals and the general public.

In culmination to the series of roundtables, Colorado Proud hosted a virtual symposium titled Iconic Times for Colorado Agriculture: 2020 Learnings and 2021 Futureproofing. Commissioner of Agriculture Kate Greenberg moderated the symposium and hosted a panel discussion that included industry leaders from around the state plus USDA Secretary-elect Tom Vilsack. The symposium also included a video keynote address from Governor Jared Polis. Nearly 200 people logged on to participate in the symposium, which covered key learnings from this past year of disruption and revealed predictions, trends and strategies for 2021.

Campaign Results

● Secured 95 pieces of earned media coverage from local, national and industry media. o Coverage had a total estimated online reach of 96 million readers. o Coverage had an estimated 244,000 views.

o Coverage was shared an estimated 6,300 times on social media. o Notable coverage included: Colorado Public Radio, Channel 7 (KMGH-TV), FOX31 (KDVR-TV), The Denver Post, 5280 Magazine, ColoradoBIZ Magazine, Ag Information Network, Ag Journal, BARN Media and The Fence Post, among others.

● More than 230 Colorado Proud members featured on ColoradoProud.com. ColoradoProud.com has had more than 10,000 website visitors since it launched in April 2020.

● Colorado Proud membership increased almost 15% in 2020. The program now has more than 3,000 members that include growers, processors, restaurants, retailers, schools and associations statewide.

● Facebook followers increased 19% in 2020.


Statewide Impact According to a 2020 survey amongst Colorado consumers:

● 81% of respondents are very or somewhat familiar with the Colorado Proud logo, up from 75% in 2019. ● 77% purchase at least some Colorado food products. ● 85% are more likely to buy produce that is labeled with the Colorado Proud logo. ● 91% are more likely to buy Colorado grown and produced products if they were available and identified as being from Colorado.

Colorado Proud will continue public relations efforts utilizing General Funds allocated to the Markets Division, as well as CDA Ag Management Funds.

Colorado Wine

The Colorado Wine Industry Development Board (CWIDB) is part of the Colorado Department of Agriculture dedicated to promoting and furthering the development of Colorado’s grape growers and vintners. The CWIDB supports the efforts of more than 150 wineries throughout the state, producing an increasing array of premium-quality wines, as well as 200 grape growers tending about 1000 acres of grape vines. According to C.R.S. 35-29.5-105 “(2) In any fiscal year, the [CWIDB] shall budget from moneys in the fund at least one-third toward research and development and at least one-third toward promotion and marketing of the Colorado wine industry, including any administrative costs associated therewith.” [emphasis added] Paragraph (1) of that same statute, creates the Colorado Wine Industry Development Fund, which is “continuously appropriated to the [CWIDB] for the expenses of the board in implementing the provisions of this article” and is the sole source of CWIDB spending. The CWIDB renewed its contract with Cultivator Advertising and Design of Denver after an RFP process during the spring of 2019. This is the second five year contract option between the CWIDB and Cultivator. Over the past five years, Cultivator has worked to expand the public’s awareness of Colorado wines, previously using outdoor billboards in the Denver metro area as well as train-station domination installations in the concourse trains at Denver International Airport during a four-week period mid-November through mid-December. In response to the COVID-19 pandemic, ad buys shifted to digital and social media advertising, using targeted consumer interests. The pandemic caused the cancellation of promotional events such as the media FAM trip slated for spring of 2020 as well as the Governor’s Cup Winemaking Competition scheduled for this past fall. The Governor’s Cup judging will possibly be held in May of 2021, if COVID restrictions are lifted to the point we can hold a competition safely. The CWIDB just received a Statewide Marketing Grant from the Colorado Tourism Office for FY 2021-22 to hire photographer John Fielder to produce images of the Colorado wine industry, including vineyards, wineries, tasting rooms, people, and events, which will be posted in a virtual gallery on coloradowine.com. These photos will be used to promote the Colorado wine industry and made available for use by governmental and nonprofit groups promoting the wine industry and wine tourism.


Marketing contracts, pursuant to the statutory mandate above, have included: FY2019: $172,000 total budget for Cultivator (reduction in budget due to CWIDB efforts to build up cash reserve to alleviate spending authority issues)

● Update of the design and layout of the Colorado wine brochure incorporated into the

contract for printing in early 2019

● Digital advertising, billboards and the current train station installations in DEN concourses A

and C included again in 2019

o Total spend budgeted at $75,000

o Anticipated impressions for FY19 media buys: 25.6 million

● Colorado Uncorked tasting of the Governor's Collection of wines selected in the Governor's

Cup competition, held at History Colorado Center on Nov. 8, 2018

o Ticket revenue for Nov. 2018 = $16,710, $2000 of which was a donation to History

Colorado

o Attendance was 507, including VIPs and media sponsor plus Colorado Lottery

giveaways, more than triple attendance for 2017 event

o This event alone generated 4.6 million PR impressions, with equivalency value of

$43,394

● PR budget for FY19 again at $52,000

FY2020: $193,000 total budget for Cultivator, Actual spending: $190,111.53, including:

● $30,000 for branding and website refresh

● $20,000 for promotional events, including Colorado Uncorked, the public tasting of the top

wines in the state, selected during the Governor’s Cup Competition held in August

○ Ticket revenue for November 2019: $31,280.45

○ Earned media from this event: 14,600,021 PR impressions with a value of

$135,824.41

● $58,000 in media buys, including DIA and billboards plus targeted and measurable digital

media ads

○ billboards were cancelled after COVID restrictions were implemented in spring;

unspent marketing budget (just over $15,000) was redirected to buying CO Wine

branded masks given away to retail liquor stores and restaurants and to giving away

incentive packages to consumers buying at least 6 bottles at wineries.

● $64,000 for PR services

FY2021 Budget: $180,000 for Cultivator, including:

● $25,000 for photography and branding work

● $10,000 promotional events (Colorado Uncorked, tentatively scheduled for early summer

2021)

● $64,000 for PR services


● $50,000 for digital and social media paid advertising

Metrics, based on consumer survey conducted by Focus Research and Strategy in June 2019, and DOR reports:

● awareness of Colorado wine, among those who consumed wine within the past month,

stayed level (76% in 2017, 77% in 2018, 75% in 2019 and 2020)

● consumption of Colorado wine remains steady for the past three years

● The volume of wine reported by Colorado wineries to the DOR in excise tax reports rose

nearly 14% in FY2020 over FY2019, while all wine sold in Colorado from all countries and

regions 4% in the same period.

● Note: hard cider is no longer included in the marketing activities of the CWIDB per SB19-142

and no longer pays into the Wine Development Fund

Colorado State Fair

The Colorado State Fair celebrated its 149th anniversary in 2020, with a Reimagined State Fair during the COVID-19 pandemic. The event had a strong focus on 4-H and FFA competitions onsite with a wide variety of virtual events to participate in and keep the spirit of the fair alive. We had great success with drive-thru fair food, a reverse Fiesta Day parade, the World Slopper Eating competition, State Fair Day Camp and virtual competitions.

With the impact of COVID-19 and the new approach of the reimagined Fair, all marketing efforts were limited or non-existent due to budget constraints. With marketing dollars limited and a message to get to the public, we focused our money on the virtual world. Our plan was to overload our social media outlets with information, live events and tons of video content. All of the livestock and equine events held on grounds were livestreamed and all results were available online.

Marketing was the bridge between our onsite activities and our virtual activities with a goal to promote and educate our audience on what a reimagined fair looked like.

Television Advertising: Budget: $0

Five television stations in Colorado Springs/Pueblo and six television stations in Denver supported the message of the reimagined fair based on the press releases that were sent from the Colorado Department of Agriculture.

Radio Advertising: Budget: $0 A total of 11 radio stations across Colorado participated in spreading the awareness of the reimagined State Fair starting June 1 thru the end of the fair. All announcements or mentions were successful because of strong relationships with our radio partners.

Public Relations: Budget: $0

https://coloradowine.com/wp-content/uploads/2019/08/CO-Wine-Consumer-Research-June-2019.pdf


A total of 11 press releases were sent related to the 2020 State Fair, from announcing the reimagined event, to a call for virtual contest entries, to the results of the Junior Livestock Auction. A distinct appeal was sent directly to the Colorado Department of Agriculture media list, asking for support and in-kind promotion of the 2020 event. The media responded with nearly 700 media hits, with 330 directly attributed to high-value television and radio.

Promotional Materials: Budget: $3,200

With a worldwide pandemic taking place, we spent the limited funds on face coverings, which were distributed to staff, auction buyers, and sold during our drive-thru events.

Digital: Budget: $500

Social media activity was more robust than ever this year, both stand-alone content and posts supporting larger media coverage helped spread the brand awareness and events happening for people across Colorado. With a strong emphasis on virtual the State Fair website needed an overhaul to be able to highlight our live streamed events, State Fair Day Camp and our on demand library.

Overall Results: With the challenges 2020 brought many of us, including virtually no funding for one of Colorado’s premier summer events, the reimagined State Fair was a success both onsite and virtually:

● 75,000 unique views of virtual content ● 52,000 Vimeo views ● 25,000 website users ● 1,044 Livestock Entries ● 3,384 cars drove through the fairgrounds for the Drive Thru Fair Food event

Colorado State Fair will continue public relations efforts focusing on brand awareness utilizing General Funds to promote the importance of the fair.

Other

The Colorado Department of Agriculture participates in a number of effective public awareness and outreach activities and efforts that receive no funding. In 2020, these included:

● Cultivating Colorado magazine with a theme of “Strength in Diversity.” In addition to being sent to school libraries, visitor centers and consumer touchpoints statewide, messaging in the magazine is promoted throughout the year. The publication is funded entirely by advertisers, with CDA working to help secure their support annually.

● Enhanced awareness of CDA’s Laboratory Services Division through the creation of a new

youth outreach program, a Governor’s Proclamation and Facebook live event in conjunction with National Weights and Measures Week and promotion of the laboratory’s Green Lab Certification.


● “Cultivation Station” is a new ag business development outreach tool created and managed by CDA markets staff that now has eight published episodes, more than 950 downloads and an average rating of five stars on Apple Podcasts. More than 36 industry professionals, professors, government officials, and Colorado Proud members have been interviewed to date.

Communications channels leveraged for outreach and awareness without funding include:

● Website - completely redesigned in 2020 ● Newsletters - more added in 2020 for a current suite of eight across the department ● Press releases ● Earned media and story pitches ● Governor proclamations ● Social media ● Regular monthly radio interviews ● Annual ag-themed photo contest ● Presence at and promotion of events including the National Western Stock Show, Colorado

Farm Show, and State Fair

4 Please identify how many rules you have promulgated in the past year (FY 2019-20). With respect

to these rules, have you done any cost-benefit analyses pursuant to Section 24-4-103 (2.5), C.R.S.,

regulatory analyses pursuant to Section 24-4-103 (4.5), C.R.S., or any other similar analysis? Have

you conducted a cost-benefit analysis of the Department’s rules as a whole? If so, please provide

an overview of each analysis.

During FY 2019-20 the Department promulgated 11 rules. A cost-benefit, regulatory, or similar

analysis was not conducted for these rule revisions. A cost-benefit analysis has not been

conducted on the Department’s rules as a whole.

5 What are the major cost drivers impacting the Department? Is there a difference between the

price inflation the Department is experiencing compared to the general CPI? Please describe any

specific cost escalations.

In general the Department’s costs are increasing at a rate that aligns with the general CPI.

However, administrative cost increases such as PERA Direct Distribution, Legal Services, Payments

to OIT etc. are increasing at a rate faster than the general CPI. While individually these increases

are not major cost drivers for the Department, collectively they can have a significant impact on the

Department’s cash funds. CDA primarily receives revenue from inspection, licensing and

registration fees (TABOR). As a result, as administrative costs increase, the Department has to

increase fees to generate enough revenue to offset costs. As these costs continue to increase, more

fees are likely to need to be increased, which is something we take into serious consideration as we

assess the impact of such increases on our stakeholders.


6 How is the Department’s caseload changing and how does it impact the Department’s budget?

Are there specific population changes, demographic changes, or service needs (e.g. aging

population) that are different from general population growth?

The Department’s caseload is made up of licenses and registrations for agricultural producers. Over

the past few years the Department saw an increase in hemp registrations; however, in 2020

registrations dropped by approximately 50 percent. The Department has been working to balance

resource needs to implement federal rules in the program with fluctuating revenue and will

continue to do so through the budget process as necessary.

The other program that has seen growth above typical caseload is the Pet Animal Care Facilities Act

(PACFA) program. As reported in the 2018 Department of Regulatory Affairs Sunset Report, the

number of active licensees has increased between 12% and 20% each year and the Department

expects this growth to continue. Although this growth has put a strain on the Department’s

resources, the 2018 Sunset bill appropriated funding to the Department to manage additional

licensees and complaints effectively.

7 In some cases, the roles and duties of existing FTE may have changed over time. Please list any

positions that have been created in the Department since FY 2018-19 that were not the result of

legislation or a decision item.

● Program Management III, Division Director in the Laboratory Services Division (2018)

● Administrative Assistant II, Administrative Assistant/Receptionist in the Laboratory

Services Division (2018)

● Technician III, Brand Inspector, while this position was added an FTE was not added.

Adjustments were made to properly allocate all part-time employees and this position

was added to fill the allocated FTE. (2019)

● Legislative Liaison, while this position was added it is allowed for in the Constitution as an

“S” position. (2019)

● Administrator IV, soil health specialist, grant funded through an NRCS grant (2021)

● Lab Tech II, grant funded through an FDA grant (2020)

● Human Resources Director, this position was added as a result of restructuring. While this

position was added it is allowed for in the Constitution as an “S” position. (2021)

For all FY 2021-22 budget requests that include an increase in FTE:

a. Specify whether existing staff will be trained to assume these roles or these duties, and if

not, why;

Existing staff are not going to be trained to assume the role of Hemp Enforcement for which 1

FTE was requested in the R-02 “Hemp Enforcement FTE” budget request. Currently less than 1

FTE conducts the enforcement duties. Under USDA’s current Interim Final Rule (IFR), CDA would

be responsible for 100% testing of the state’s registered hemp crop, which would lead to an


exponential increase in workload for the Department. If the IFR is to be enacted as final rule,

that staff member’s time will be allocated to other job duties and enforcement needs will

drastically increase.

b. Specify why additional FTE are necessary;

The Department anticipates a 75% increase in sampling in 2022 as a result of the 100% testing

federal requirement. As such, there will be more complaints, more crops that test above the

allowable THC content that must be destroyed and other issues that the Department will need

resources to manage. At this time, the Department believes that one additional FTE will be able

to complete the work in a timely and effective manner. Should it be determined that one FTE is

not enough, the Department would work through the normal budget process to request

additional resources.

c. Describe the evaluation process you used to determine the number of FTE requested.

The Department had a LEAN study conducted in 2019 of the Industrial Hemp program. The

results suggested that dedicated resources were needed for enforcement activities. In addition

to that finding, the Department analyzed current hemp enforcement activities and extrapolated

that to understand what the potential enforcement workload could look like when 100% testing

is implemented.

8 Please describe any programmatic impacts resulting from cash fund transfers impacting the

department as part of the FY 2019-20 and FY 2020-21 balancing process.

The Department did not have any cash fund transfers as part of the FY 2019-20 or FY 2020-21

budget balancing process.

Documents

DEPARTMENT OF AGRICULTURE FY 2021-22 JOINT ......6-Jan-2021 AGR-hearing 2:30-2:45 DEPARTMENT OF AGRICULTURE FY 2021-22 JOINT BUDGET COMMITTEE HEARING AGENDA Monday, January 25, 2021