CALIFORNIA CATTLEMAN WEEKLY

May 13, 2024

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Governor Newsom Releases May Revision of Proposed 2024-25 State Budget
Governor Gavin Newsom held a press conference on Friday to overview the “May Revision” of his proposed 2024-25 State Budget.

The May Revision proposes a total budget of $288.1 billion, with $201 billion coming from the State’s General Fund. While the Governor’s January 10 Proposed Budget projected a $37.9 billion budget shortfall, that outlook has since shifted: the state’s revenues have come in $7 billion short of January’s projections, but early-action budget adjustments signed into law on April 15 reduced the shortfall by $17.3 billion. What remains is a 2024-25 projected budget gap of $27.6 billion. The Governor’s May Revise seeks to close that budget shortfall as well as “next year’s projected $28.4 billion deficit,” according to a press release from the Governor’s Office.

Full details of the May Revision will likely not be available until tomorrow, the statutory deadline by which the Department of Finance must provide such details, but Friday’s announcement provided significant insights into how the Administration proposes to address California’s funding challenges.

The Governor has proposed shifting $1.7 billion in funding from the General Fund to the Greenhouse Gas Reduction Fund (GGRF) for “transit programs, clean energy programs, zero-emission vehicle programs, and nature-based solutions programs.” Over the next five years, such shifts from the General Fund to the GGRF are anticipated to total $3.6 billion.

The May Revision also proposes to cut $500 million in one-time funding for water storage facilities in the 2025-26 budget year. The Administration suggests that this reduction will be targeted at Sites Reservoir, which it argues does not yet need that funding, and the Governor’s budget summary notes that “Proposition 1 of 2014 dedicated $2.7 billion for investments in water storage projects, and significant funding is still available for this purpose.”

Also of interest to CCA members, the Governor’s May Revision proposes fully funding CCA-opposed SB 253 (Wiener), the “Climate Corporate Data Accountability Act” which requires large corporations to report their greenhouse gas emissions, including those attributable to the company’s upstream and downstream supply chain (so-called “scope 3 emissions”). The Governor’s January proposal initially withheld funding for the measure, which is currently being challenged in court by the U.S. Chamber of Commerce and other organizations.

During his press conference on Friday, the Governor also teased budget action on property insurance, which is likely to take the form of a “budget trailer bill” expediting the process under which state regulators review insurers’ rate requests.

CCA will provide additional details on the May Revise and continuing Budget negotiations as they become available. Negotiations between the Administration and Legislature will continue over the next month ahead of a June 15 Constitutional deadline for lawmakers to finalize a Budget, during which time CCA will continue advocating for funding for the Association’s fiscal priorities, including wolf-livestock compensation funding and wildfire-resilience investments.

CDFW Releases Gray Wolf Updates
Last week, the California Department of Fish and Wildlife announced the release of its quarterly wolf update for the first quarter of 2024. For the first time, the Department has named the new wolf pack identified in Nevada and Sierra counties, designating the pack the “Antelope Pack.” In addition to the seven wolf packs already known to inhabit the state, the update makes note of several other “Areas of Wolf Activity:” two wolves have been documented near the state line in northwestern Modoc County, two wolves hailing from Siskiyou County’s Whaleback Pack have been identified in southern Modoc County, two wolves have been detected in eastern Plumas County and two wolves have been identified in eastern Tehama County.

The Department also notes that it is surveying “several additional areas of suspected wolf presence in Lassen, Modoc, Plumas, and Shasta counties.”

Only four of the seven wolf packs appear to have functioning radio-collars. Collared wolves include the breeding female of the Beyem Sayo Pack in Plumas County (designated “LAS23F”), the breeding female of the Harvey Pack in Lassen and Shasta counties (WHA05F), the breeding male of Siskiyou County’s Whaleback Pack (OR85) and the breeding female of Tulare County’s Yowlumni Pack (YOW01F). No members of the Antelope, Beckwourth or Lassen packs currently have functioning collars (the sole collar of a Lassen Pack wolf failed earlier this year).

The Department also released nine new depredation investigation reports from the first quarter of the year (a tenth, from January 3, was posted earlier this year). A January 22 investigation confirmed that a calf in western Lassen County was killed by the Harvey Pack. That same day, an investigation in Siskiyou County confirmed that the Whaleback Pack attacked two calves. On February 19, the Whaleback Pack was confirmed to have killed another calf. Of the remaining six investigation reports posted last week, four determined the cause of death of calves as “Unknown,” one found a calf kill in eastern Siskiyou County to be a “Possible Wolf” kill and another determined a Butte County sheep depredation to have been caused by a mountain lion rather than a wolf.

Central Valley Meat’s Purchase of the Fresno Cargill Facility Explained on CCA Podcast
Last week, Central Valley Meat Holding Company announced it has entered an agreement to purchase the Cargill Meat Solutions beef processing facility in Fresno, Calif. Central Valley Meat is a diversified family-owned corporation. Harris Ranch Beef Company and Harris Ranch Feeding are two of the facilities owned by the company, in addition to Central Valley Meat and CLW Foods.

In an exclusive interview on Sorting Pen: The California Cattleman Podcast, Central Valley Meat’s CEO and President Brian Coelho shares about this new acquisition. On the episode, hear Coelho address concerns producers may have about the loss in competition with Cargill out of the picture, talk about the capacity Central Valley Meat will have with this added facility, share why he believes this is a positive move for California’s beef industry and more.

Listen to the episode for free, without subscribing at calcattlemen.org or on Apple Podcasts, Spotify and other streaming platforms.

UPDATE: USDA Finalizes Traceability Rule Requiring Electronic Identification
On Thursday, USDA’s Animal and Plant Health Inspection Service formally published in the Federal Register a final animal disease traceability rule requiring electronic identification (EID) for the interstate movement of all intact cattle over the age of 18 months, all dairy cattle and all exhibition or rodeo cattle. The final rule is scheduled to go into effect on November 5, meaning cattle tagged on or after that date will be required to have an EID tag prior to moving interstate. All currently authorized visual identification tags applied to cattle prior to November 5 will be grandfathered in under the final rule and will be valid for the life of the animal. For more information, see the April 29 edition of California Cattleman Weekly.

House and Senate Ag Committees Outline 2024 Farm Bill Priorities
On May 1, the Agriculture Committees of the U.S. House of Representatives and the U.S. Senate released their respective frameworks for the 2024 Farm Bill. The House framework includes several cattle industry priorities, including strengthening disaster-assistance programs and voluntary conservation programs such as the Environmental Quality Incentives Program (EQIP). A full markup of the House’s proposed Farm Bill is expected before Memorial Day. The Senate outline is more of a mixed bag, aiming to designate 100,000 acres of forests as wilderness and proposing to require feedlots to “submit a greenhouse gas emissions reduction plan” to access EQIP funding, among other provisions. A more detailed outline of the Senate proposal is available here (the Senate timeline for advancing the Farm Bill is not yet clear). For more information, see last week’s edition of California Cattleman Weekly.

SWRCB Releases New Fact Sheets and Renews Call for Annual Reporting Compliance
The State Water Resources Control Board (SWRCB) has announced the availability of two new fact sheets – “Water Rights 101” and “Water Use Reporting Requirements” – to improve water rightsholders’ understanding of water rights and reporting requirements. The SWRCB used the release of the fact sheets as “a reminder to all water right holders to file water rights annual diversion data from water year 2023 (October 1, 2022 – September 30, 2023).” Reports for all diverters were due February 1, but the SWRCB notes that roughly 13,000 diverters have not yet reported their diversion and use of water for the 2023 water year. In its announcement, the SWRCB asked delinquent filers to “please file immediately.” As previously reported in California Cattleman Weekly, the SWRCB is in the process of issuing notices of violation to delinquent filers.

Upcoming Deadlines for Air District Grants
The California Air Resources Board (CARB) provides $60 million annually in grant funding to repower or replace older off-road and on-road equipment through the Carl Moyer Program. The program is administered by each of the 35 local air quality districts and often can provide funding to replace or repower ag equipment such as loaders, tractors, and pump engines. However, each district has some degree of latitude in how they administer the program, including the application process. While some districts accept applications on an ongoing basis, others have short application periods.

The Rancher Technical Assistance Program (RTAP) has compiled a list of these application periods and can help ranchers navigate the application process. Reach out to RTAP at (916) 409-6902 or rtap@wrstrat.com if you would like to know when your district’s application period is open or learn more about the Carl Moyer Program.

Air Quality Districts with upcoming Carl Moyer Program application deadlines: 

Butte County AQMD – Closes 5/23/24
Colusa County APCD – Closes 5/31/24
North Coast Unified AQMD – Closes 5/31/24
Placer County APCD – Closes 5/31/24
Ventura County APCD – Closes 6/21/24

USDA Agricultural Marketing Service Seeks Nominations for the Cattlemen’s Beef Promotion and Research Board 
The USDA Agricultural Marketing Service (AMS) is seeking nominations for the Cattlemen’s Beef Promotion and Research Board for the Southwest Unit. Beef producers within the United States who own cattle or any importers that import cattle or beef can be nominated by eligible organizations. To learn more about the Cattlemen’s Beef Board click here. To learn more about eligibility, click here. For more information, contact CCA’s Associate Director of Communications Maureen LaGrande.

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CCA in the News

U.S. Rountable for Sustainable Beef elects new leadership and board of directors Beef Magazine  “I am looking forward to working with this group,” said Mike Williams, 2024-2025 USRSB Chair. “The Roundtable has a lot of work ahead of it, and I am eager to see what we accomplish in the upcoming year.” To continue reading, click here.

Industry News

California reports the first increase in groundwater supplies in 4 years Associated Press “The state saw 4.1 million acre-feet of managed groundwater recharge in the water year ending in September, and an 8.7 million acre-feet increase in groundwater storage, California’s Department of Water Resources said. Groundwater supplies are critical to growing much of the country’s fresh produce.” To continue reading, click here.

California’s second-largest reservoir is now full The San Francisco Chronicle “Lake Oroville, the second-largest reservoir in California, reached capacity on Monday for a second straight year after another relatively wet winter.” To continue reading, click here.

Central Valley Meat Strikes Deal to Acquire Fresno Cargill Plant The Business Journal “‘Our decision to acquire the Cargill Meat Solutions beef processing facility in Fresno, California aligns with our long-term vision of strengthening our offerings to better serve the needs of our customers,’ said Brian Coelho, CEO and owner of Central Valley Meat. ‘We’re excited to work alongside cattle producers in the state and region to continue delivering quality beef products for our customers and consumers.’” To continue reading, click here.

Number of Sonoma County farms affected by proposed ‘factory farming’ ordinance is in dispute North Bay Business Journal “Sometime this year, an initiative aiming to curtail factory farming will appear on local ballots. Its authors frame it as a ban on cruel and unsanitary industrial farms. The local agricultural industry calls it a backdoor attack on the consumption of meat.” To continue reading, click here.