The Government Operations Division approved an amended version of Senate Bill 2342, a measure designed to encourage dairy processing capacity in North Dakota, and recommended the bill for passage after changes to the bill’s language and funding approach.

Matt Purdue, on behalf of the North Dakota Farmers Union, asked the committee to “plant a flag” for dairy processing in the state. Purdue said a post‑production incentive could attract a processor that would commit to reaching full capacity and that state support would help existing dairy farms avoid hauling milk to out‑of‑state processors.

Testimony from livestock advocates echoed that processing is necessary to sustain and grow the state’s dairy sector. Pete Hanover of the North Dakota Farm Bureau said dairy producers operate on thin margins and need nearby processing to remain viable.

Committee members and witnesses discussed ownership and corporate farming limits; witnesses noted the bill’s language did not restrict ownership types for a future processor and clarified that corporate farming rules in the state apply to production, not to food processing facilities.

The committee amended the bill in several respects: the text was changed from “production” to “processing,” a unit of measure was changed from gallons to pounds (5,000,000 gallons to 3,000,000 pounds) to better reflect processing metrics, and a direct $10,000,000 appropriation originally in the draft was removed. Instead, the committee adopted language mirroring a separate potato‑processing approach: if the AD (agricultural development) fund approves an incentive or grant, the AD fund would submit the approved request to the next legislative session for appropriation consideration (a commitment rather than an immediate cash appropriation on the floor).

After debate the division voted to recommend the bill with the adopted amendments. The committee recorded its approval and instructed staff to prepare the amended bill for the next stage of consideration.