To be sure, there is belt-tightening and there is also belt-choking.

When $20.1 million in ethanol plant subsidies were cut, Minnesota corn growers and ethanol plant operates felt they were being strangled.

On Feb. 7, Gov. Tim Pawlenty announced spending cuts to help resolve the state's $356 million deficit through June.

Among the cuts was $49 million from the Iron Range economic development fund and the $20.1 million in ethanol plant subsidies.

The governor was forced to take the action after the Senate and the House failed to reach agreement on the Minnesota Legislature's own plan to balance the budget.

It did not come as any surprise to the state's corn growers and ethanol plant operators. A month ago, the governor proposed culling ethanol subsidies by $26.8 million.

Pawlenty said most ethanol plants would remain profitable without state subsidies.

Education funding received the deepest cut in state spending. Pawlenty sliced $50 million from higher education funding and $26.9 million from K-12 education funding.

Environmental programs lost $39.7 million and social services, $23 million.

Rural lawmakers and farmers thought the governor was targeting greater Minnesota for the spending cuts.

Not only were the ethanol plant subsidies cut, but soil and water conservation, the Agricultural Utilization Research Institute, county fairs and rural economic development programs were siphoned of state monies.

After gasping for air after Pawlenty announced his spending reductions, Bryant Hokeness, the president of the Minnesota Corn Growers Association, has had time to reflect.

The Marshall Township grain farmer is worried for growers and ethanol plant operators.

"That was quite a cut the governor made," Hokeness said. "For some 13 plants to be cut down to $6 million in subsidies is quite a shock."

Hokeness expects two of the 13 -- he didn't say which ones -- will be most seriously affected, even to the point of considering closing.

Other plants, such as those at Claremont, Preston and Glenville, recently completed expansion projects which nearly doubled the size at each ethanol plant.

"It's going to be difficult, because this is quite a setback for the rural economy in Minnesota," he said. "So much depends upon the success of the ethanol plants. Not only the farmers benefit, but school districts, small towns and the rest of the economy."

The ethanol plant subsidies were monies paid directly to the plants by the sates and then passed on to farmer-members in the form of production payments. They were to last for 10 years before Pawlenty's action.

Hokeness is among those who feel South St. Paul's native son, Pawlenty, targeted greater Minnesota for the first round of budget reductions.

"The state's agriculture budget comprises less than 1 percent of the state's general fund," Hokeness said. "Yet, 7 percent of the spending cuts came from the ag budget."

And, Hokeness worries about the future.

"With the $4.2 billion they have to cut from the next biennium's budget, that's going to make the $356 million in cutbacks look mighty small."

By mid-February, most farmers planting intentions are known. They have gone to banks and other lending institutions and purchased seed and fertilizer, plus other chemicals.

All that was left was to wait out winter and take to the fields again when spring arrived.

Corn, Minnesota's most abundant crop, is the farmer's gold.

Biotechnology holds a huge potential for corn; particularly in the area of industrial technology and

replacing petrochemicals in fiber and plastics. That alone, the ability to use renewable crops to displace America's dependence on oil, only hints at corn's golden future.

But today in Minnesota, the reality of the state's budget deficit impacting agriculture's ethanol industry is touching more and more farm families and their rural communities.

"Right now, there's not much that people can do," Hokeness said. "They have their marketing plans and corn is a large part of them. Decisions have been made. About all farmers can do is stay in touch with their senators an d representatives and tell them how they feel about this.

"I know it's bad. I know a banker who said if he had known the governor was going to take away the ethanol subsidies, he wouldn't have loaned the farmer any money for his spring crop."

Lee Bonorden can be contacted at 434-2232 or by e-mail at :mailto:lee.bonorden@austindailyherald.com