As Illinois lawmakers return to Springfield for the 2026 spring session, “affordability” is the guiding theme. House Speaker Emanuel “Chris” Welch has pledged to focus on household budgets and job growth, as economic concerns rank highest for nearly 40% of Illinois voters. Yet a projected multibillion-dollar budget deficit for fiscal year 2027 and uncertainties about federal funding create significant hurdles. In this challenging environment, the Illinois Soybean Growers’ (ISG) legislative priorities represent strategic investments in agricultural sustainability, economic growth and long-term rural viability.

ESTATE TAX REFORM: PRESERVING FAMILY FARMS

Illinois’ estate tax poses a unique threat to family farms seeking generational transfer. The state’s $4 million exemption lags far behind the federal threshold of $15 million, creating a financial strain that can force the sale of land or family assets.

Raising the estate tax exemption and aligning it more closely with federal standards would help preserve family-owned farms and ensure multigenerational operations remain intact. With 96% of Illinois farms being family-owned, estate tax reform is not just a private concern, it affects the broader agricultural economy. Rising farmland values often surpass farm income, creating tax liabilities that threaten the continuity of farming operations. Reforms that prevent such burdens would protect both individual families and the agricultural sector as a whole.

ANTICIPATED LEGISLATIVE CHALLENGES

Beyond budget negotiations and priority legislation, Illinois agriculture is facing increased scrutiny in Springfield, particularly related to pesticide use and wetland regulation. Several proposals under consideration would expand state oversight of land-management practices, potentially introducing new notice, reporting or permitting requirements that affect how and when farmers operate.

Although these initiatives are often framed as environmental protection or public safety measures, they risk creating regulatory uncertainty, increasing operating costs and reducing flexibility for working farms. ISG will remain actively engaged as a backstop for farmers, advocating for policies that are grounded in sound science, respect established farm practices and balance environmental goals with the realities of agricultural production. Ensuring that new regulations do not undermine productivity or long-term farm viability will remain a core focus as these discussions evolve.

CONSERVATION FUNDING: MEETING GROWING DEMAND

Conservation programs remain critical for Illinois agriculture, yet state funding has lagged behind demand. ISG prioritizes increased support for Fall Covers for Spring Savings, Soil and Water Conservation Districts and Illinois Extension.

The Fall Covers for Spring Savings program incentivizes cover crops by offering up to a $5-per-acre crop insurance premium discount. In 2025 through 2026, the program allocated funding for 190,000 acres. Requests for more than 241,650 acres exhausted funding in under one hour, demonstrating overwhelming farmer demand. Since inception, the program has supported cover-crop adoption on 700,000 acres statewide.

Soil and Water Conservation Districts face a different challenge with funding cuts. State appropriations for Illinois’ 97 conservation districts dropped from roughly $13 million to $7.5 million in fiscal year 2026, nearly a 50% reduction. This leaves districts with only $40,000 per year, enough for roughly one full-time staff member, though two are needed to meet program and technical assistance demands.

Illinois Extension, which provides research-based education and technical support in all 102 counties, has seen modest funding increases, yet demand continues to outpace available resources. Extension specialists play a crucial role in helping farmers implement conservation practices, interpret research and navigate regulatory requirements.

COLLABORATIVE CONSERVATION PARTNERSHIPS

The Illinois Soybean Association (ISA) emphasizes collaboration to expand conservation funding, recognizing that water quality, soil health and ecosystem services extend beyond traditional agricultural constituencies.

Illinois has secured $106.1 million dollars in conservation funding over five years through partnerships with both public and private stakeholders. This includes $73 million from the Climate Pollution Reduction Grant and more than $20 million from USDA’s Natural Resources Conservation Service. Programs such as the Climate Smart Agriculture Program, which provides $67 million in combined state and federal cost-share funding for no-till and strip-till practices, exemplify these collaborations.

Nontraditional partnerships are increasingly important. Environmental organizations, public health advocates and urban communities are recognizing the links between agricultural practices and broader outcomes including drinking-water quality and air quality. For instance, the Trinity Health Benefits Study highlighted that increased biodiesel use could reduce diesel particulate matter-related cancer risks, garnering urban support for agricultural biofuels.

By working with diverse stakeholders, Illinois agriculture can secure durable conservation investments that deliver public benefits beyond commodity production, building political and community support for these initiatives.

BIODIESEL LEADERSHIP: MAINTAINING COMPETITIVE ADVANTAGE

Illinois is the No. 1 soybean-producing state in the nation and ranks fourth nationally in biodiesel production, with an annual capacity of 192 million gallons. As of 2024, the state uses 175 million gallons of biodiesel annually. Additionally, tens of millions of gallons are used off-road in rail and in marine applications. With increasing blend incentives, the in-state capacity and usage will increase. According to a new study commissioned for ISA, the biodiesel industry supports nearly 33,300 jobs and generates more than $2.3 billion in state economic activity.

Since 2003, qualifying biodiesel blends have been exempt from the 6.25% state sales tax. Landmark 2022 legislation extended this exemption and gradually increased required blend levels through 2032. As of April 1, 2026, the minimum qualifying blend will reach B20, with winter reductions to B11 from December through March. Once this legislation is fully implemented, Illinois’ biodiesel market will approach 300 million gallons, surpassing California and Texas.

These policies help Illinois capture growing biodiesel demand, support in-state soybean processing and prevent soybean oil from being shipped out of state. Illinois produced nearly 700 million bushels of soybeans last year, with approximately one-third processed domestically for soybean oil. Policies supporting biodiesel consumption directly benefit farmers by boosting demand and improving market basis.

CONCLUSION

ISG’s 2026 legislative priorities respond to immediate economic pressures while positioning Illinois agriculture for long-term sustainability. Estate tax reform would help preserve family farms, while enhanced conservation funding addresses both environmental goals and strong farmer demand. Strategic partnerships further expand conservation investments and demonstrate agriculture’s commitment to stewardship and public benefit.

At the same time, Illinois agriculture must remain vigilant as new regulatory proposals emerge. Growing attention to pesticide use, wetland regulation and land-management practices underscores the need for active engagement to ensure policies are practical, science-based and workable for farmers. Proactive advocacy will be essential to prevent unintended consequences that could increase costs, limit flexibility or threaten farm viability.

Biodiesel policy leadership remains a cornerstone of Illinois’ competitive advantage, supporting soybean demand, strengthening in-state processing and reducing emissions. Together, these priorities reflect a comprehensive approach to advancing an agricultural sector that is economically resilient, environmentally responsible and responsive to evolving policy challenges.

As the 2026 legislative session unfolds amid budget constraints and election-year dynamics, ISG will continue to engage lawmakers, build broad coalitions and clearly communicate agriculture’s value to the state. Sustained advocacy and collaboration will be critical to protecting farmers’ interests while shaping policies that support Illinois agriculture’s long-term success.