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Gov. Ted Strickland’s two-year budget proposal calls for a significant investment in alternative fuels such as biodiesel but calls for decreased funding for several agriculture-related departments.

"The governor’s budget is generous with biofuels. Our concern remains with certain traditional agricultural programs," said Rocky Black, Ohio Farm Bureau’s senior director of policy and political affairs.

Strickland’s two-year, $53 billion budget proposal sets aside $2.5 million for the installation of E85 tanks and soy biodiesel pumps at gas stations and provides grants for facilities that blend soy biodiesel. OFBF worked closely with the administration to get such funds included in the budget.

In Strickland’s budget proposal, funding for the Ohio Department of Agriculture would drop 2 percent in 2008 and half a percent in 2009, Black said. ODA Director Robert Boggs told the House Agriculture and Development Finance Subcommittee that his agency will be able to maintain most current services, despite the cut in state funding. Funding for ODA’s livestock regulation program received a slightly higher allocation, Black said.

Ohio State University Extension would receive no additional funds, and the Ohio Agricultural Research and Development Center would have an increase of 2 percent the first year and no additional funding in 2009. The Ohio Department of Natural Resources also would have a slight decrease in funding and Soil and Water Conservation Districts would have a decrease in the amount of state funding match, Black said.

"Of course we’d like to have more funding for these departments, but Strickland has done a good job of making due without raising taxes or fees," Black said. "We’ll communicate with his staff about where our concerns are and propose specific funding amounts."

Ohio’s green industry, primarily landscape and nursery businesses, said it is concerned that its funding was cut from nearly $1 million each year to $50,000. Black said the lower state funding was because the industry is shifting to a fee-based system. But he noted that there needs to be sufficient funding for regulation of the industry.

The budget announcement followed Strickland's first State of the State speech in which he promised an almost $1 billion investment in energy programs to ensure energy is an economic development leader in Ohio.

"Next-generation energies – biofuels, fuel cells, clean coal and renewable sources such as wind – offer us the opportunity to create jobs, support our farmers, reduce our dependence on foreign oil producers and be responsible stewards of our environment," Strickland said.

For years OFBF has been working with state lawmakers and governors to come up with policies and support for research and alternative energy technologies. Reps. Tony Core, R-Rushsylvania, and Steve Reinhard, R-Bucyrus, also are working to extend funding for biofuels. Sens. Larry Mumper, R-Marion, and Kirk Schuring, R-Canton, have taken a lead on the biofuels issues in the budget.

Strickland’s budget also contains a proposed $1 million for methane digester projects.

"Agriculture and rural Ohio can make a major contribution to these energy initiatives outlined by Governor Strickland," said OFBF's Senior Director of Public Policy Keith Stimpert. "New jobs and economic development will result from exploring our energy potential and finding other new uses for agricultural products."

The specifics of the governor's $1 billion investment include targeting $250 million per year in tax exempt bond cap allocation to leverage billions of additional investment money in energy projects. The Third Frontier project, started by former Gov. Bob Taft, also will be strengthened.

The budget is now in the hands of the state legislature, which has until June 30 to pass a budget.

Caption: Ohio Gov. Ted Strickland promised an almost $1 billion investment in energy programs during his first State of the State speech.