Remarks by Governor Paul E. Patton
Kentucky Farm Bureau Ham Breakfast
August 22, 2002

Thank you, Sam.  Over the past two years, I have had the opportunity to work closely with you on the Agricultural Development Board, and I appreciate the leadership you provide us on very complex issues.  You represent the Kentucky Farm Bureau very well and I thank you for your service to the Commonwealth.

Commissioner Billy Ray Smith, I want to say a special thanks to you and the Department of Agriculture for your leadership, especially in the area of marketing and promotion of our farm products. Your Kentucky Fresh campaign is off to a good start, and your department is to be commended for its hard work.

As most of you know, the State Fair is one of my favorite times of the year, and the Ham Breakfast is one of my favorite events. It’s a special time when we can pause and reflect for a while on what brings us together as Kentuckians, what’s good about Kentucky, and in particular, what’s good about Kentucky agriculture.

 I’d like to use this occasion to report to you the state of agriculture in Kentucky as I see it.  

One of the greatest blessings in life, at least in my opinion, is the privilege of being raised in rural Kentucky or being able to raise a family in rural Kentucky.   I’ve had both opportunities and some of the highest priorities of our administration have been to preserve the option for future Kentuckians if they want it for their children.  

Over the past six years, our administration has worked hard to seize some important opportunities and create some others on behalf of Kentucky’s farm families. These opportunities now have us in a position to successfully manage our way through the changes being forced on our farm families by downturns in the tobacco economy.

In my first executive budget in 1996, which was a sparse budget, we increased funding for the Department of Agriculture, provided record high levels of support for important agricultural research, and development infrastructure and we funded investments at UK’s Pin Oak Farm.   The agricultural community spoke; we listened and we acted.

In July 1998, to keep me in direct contact with the changes happening in Kentucky’s agricultural economy, I established the first Governor’s Office of Agricultural Policy. Over the past four years, this office has assumed critical administrative functions few people envisioned at the time we created it.

In November 1998, Kentucky signed onto the Master Settlement Agreement, and we immediately went to work on nailing down direct compensation for our tobacco farmers to offset losses they might incur as a result of the settlement.

It was in March of 1999 that we signed the National Tobacco Growers Settlement Trust.  Since then that program has delivered unrestricted direct cash payments to over 150,000 Kentuckians totaling more than $324 million.  And those who were in Raleigh, North Carolina during those critical negotiations about the future of the tobacco farmers of America know if it hadn’t been for the leadership Commissioner Smith and I provided at a critical juncture in those negotiations we wouldn’t have a Phase II program and if we hadn’t been tough, Kentucky wouldn’t have gotten our fair share of the proceeds.  The other states now realize that we got the most favorable distribution that we could have possibly gotten.  That’s what you sent us down there to do and we did it!

In December of this year, the Trust will deliver another $130 million to our tobacco quota owners and growers. This $454 million, including a $40 million supplement from the agricultural development fund and $320 million more from Senator McConnell’s Tobacco Loss Assistance Program, bring the grand total of direct compensation to Kentucky tobacco farmers to $770 million since December 1999!

And we’ve managed to get that money to our farmers with the lowest administrative costs among all 14 states participating in the trust. Our costs have been just one-fourth of what North Carolina has spent, and every dollar saved on program administration goes directly to our farm families. The help of our county extension offices and local farm service agency personnel has been a big part of this success.  

We also recognize what a valuable partner the federal government can be to our farm families.  Last year my office submitted an application to the US Department of Agriculture Conservation Reserve Enhancement Program to access federal funds for environmental conservation efforts.

Largely as a result of the environmental cost-share funds committed from our Agricultural Development initiative and a strong application from several state agencies, we were awarded $85 million in federal funds, the largest federally financed agricultural conservation program in the state’s history.

With the state’s matching funds, over $105 million will be channeled to the nine counties in the Green River watershed area over the next 15 years to protect one of Kentucky’s most threatened natural waterways and to pay farmers for the public service they perform by keeping our rivers and streams clean.

But the centerpiece of our efforts to sustain our family farms is the Agricultural Development Fund, the largest state-financed agricultural diversification effort in the history of the United States. Let me review for you some of the highlights since this program came into existence just two short years ago:

Over $43.8 million of these projects are developing new markets for Kentucky farm products; new markets for livestock, grain, and horticulture.  We’re supporting many new and emerging opportunities for Kentucky farmers, like aquaculture, vermiculture, mushrooms, forestry and many other new projects that didn’t exist two years ago. There are livestock processing facilities, ethanol production facilities, horticulture processing cooperatives, and many other examples of new markets that are just now coming into existence.

Another $30 million has been invested in our strategic effort to make Kentucky the premier feeder cattle producer in the country. Farmers are receiving direct compensation to their individual operations through cost-share programs in cattle genetics, cattle handling, forage improvement, agricultural diversification, and our goat program.

In addition, we’ve financed the Kentucky Center for Cooperative Development, the Kentucky Beef Network, and the Kentucky Center for Agricultural Development and Entrepreneurship, all of which didn’t exist just two short years ago.

And we’re studying new opportunities.  We’re studying new markets for grapes, soybeans, aquaculture, meat and dairy goats, biomass, and even worms.

But we’re just getting this effort going full steam. Our long-term plan for agricultural development charts a new course for Kentucky agriculture built on new marketing activity, new capital access programs, support for environmental stewardship, farm family education programs, local leadership development and strong commitments to research and development, focusing on making existing agricultural activities more efficient so our farmers can be more competitive and developing new farm activities to open up new opportunities.

So how do we compare to other states?  What are other tobacco states doing for their farmers? Tennessee used their tobacco settlement to balance their budget shortfalls. North Carolina is using their resources for several other items besides diversifying their farm economy. While Virginia is doing some good things to assist its tobacco producers, the scope of its efforts does not approach our commitment to Kentucky farm families.

There are several people to thank for this monumental and historic commitment. First and foremost, let me publicly thank the members of the Kentucky General Assembly.  I know they’ve already been recognized but I’d like to ask them to stand again and be recognized for keeping the faith with Kentucky’s farm families. In the context of the largest budget shortfall in history, and bleak revenue projections, you stayed the course with our farming communities and your deserve our thanks.

And let me pause to say that we must not take dedication of fifty percent of the Tobacco Settlement Fund to agriculture for granted.  The pressure to use these funds for other worthwhile purposes will always be great.

Not all members of the General Assembly, or all candidates for governor for that matter, will have the welfare of our family farms as their highest priority.  Make sure you know a politician’s priorities before you pledge your support.

Our county agricultural development council members also deserve recognition. They represent the backbone of our efforts to re-engineer rural Kentucky, to revitalize our farms and our rural communities. If you’re a county agricultural development council member, please stand and be recognized.  

Our state board members deserve more than our thanks. I’ve never before witnessed a higher level of commitment by members of a public board than your Agricultural Development Board members. I’ll ask our board members now to stand and be recognized for all of your incredibly hard work and unfailing commitment. 

And last but not least, I want to recognize the men and women who provide the staff support for the Agricultural Development Board. They visit your county councils, they do the legwork on analyzing projects, and they work as hard as any office in state government.  John-Mark Hack and his staff are doing an incredible job!!! 

To all of you who are making this program work, we owe our thanks. You’re writing a new chapter in Kentucky history. You’re chartering new waters for the nation, proving that farming and rural communities have a future, a prosperous future, when the right combination of capital and leadership resources converges.

Now I’d like to make a presentation. It’s a symbolic presentation, but it’s important nonetheless. The General Assembly appropriated over $180 million to the Agricultural Development Fund in the 2000 session.  As a result of the 2002 session, another $120 million was committed to continue our efforts. I’d like to call on President Sam Moore and Commissioner Billy Ray Smith to receive this $120 million check on behalf of our farm families and rural communities. These are dollars that represent what will be invested over the remainder of my administration in Frankfort in the future of Kentucky farmers and their families.

CHECK PRESENTATION

It’s a down payment on our future, and one in which we can all take great pride. The future of Kentucky agriculture is brighter today, and opportunities for Kentucky farmers are greater today because of these initiatives.

Our legislature, our county councils, and our state board are leading Kentucky through an historic undertaking never before tried anywhere in the United States. Their leadership means that Kentucky is leading the nation in agricultural development. Think about that. Think about the fact that one of the most tobacco dependent farm states in the country is leading the nation in the diversification of our agricultural economy.

Let’s continue to embrace the challenges before us. Let’s work constructively together to continue the process of recreating the Kentucky farm economy. Together we’ve made a whale of a start, and together, we’ll change all of Kentucky for the better.