After dairy farmers across Connecticut urged state lawmakers to pass a tax credit incentive to help an industry burdened with high costs and federally set low prices, lawmakers signaled they are ready to deliver millions in aid to save farmers on the edge of financial ruin.
Two of the top state senate Democrats including Senate President Pro Tempore Martin Looney and Senate Majority Leader Bob Duff are both now calling on Gov. Ned Lamont to utilize funds from the emergency state response reserve. The reserve was created in 2025 by the General Assembly in response to helping the state recover from millions of dollars in federal cuts that were made by President Trump.
“Connecticut’s dairy industry was already fighting to survive under a federal pricing system that was never designed with New England farms in mind,” Looney said.
“Federal tariff policy has now made a difficult situation untenable. The Emergency State Response Reserve was created for exactly this kind of moment: when the actions of the Trump administration impose direct and demonstrable harm on Connecticut workers and industries. We urge the Governor to deploy it now, before more farms are lost permanently.”
A coalition of dairy farmers have been lobbying state lawmakers to pass a bill in the general assembly called “An Act Establishing A Tax Credit For Dairy Farmers,” that proposes a $20 million aggregate tax credit to support local dairy farmers against cyclical milk price downturns.
The bill was introduced by state Senate Minority Leader Sen. Stephen Harding, R-Brookfield, in February and has been referred to the legislature’s Finance Committee, according to the Connecticut General Assembly bill tracker.
Dairy farmers face several challenges, including low milk prices set by the federal government coupled with high operating costs. Farmers struggle to cover production costs, and dwindling state subsidies haven’t been sufficient to keep many businesses afloat, according to officials. Extreme weather events such as flooding are also a continuous threat to farmers.
Global milk prices have crashed, driven by a massive oversupply, causing prices to plummet below production costs and threatening many small-to-mid-sized dairy farms. The average price of a gallon of milk in the U.S. is now around $3.43, according to the U.S. Bureau of Labor Statistics.
But now lawmakers say they see a path forward to include the $20 million farmers are requesting through the state’s emergency fund. Under state statute required in the legislation establishing the reserve, any time the governor wants to allocate funds from it, he must first submit a plan for its use to the General Assembly, which then has 24 hours to review and either approve or disapprove. But the governor has to first make the request, according to state law.
Lawmakers say that Trump’s tariffs, which were recently ruled illegal by the U.S. Supreme Court, are hurting dairy farmers in the state. Because state farmers are being impacted by federal laws and regulations, they say that tapping into the fund is appropriate.
“Connecticut’s dairy industry was already fighting to survive under a federal pricing system that was never designed with New England farms in mind,” Looney said.
“Federal tariff policy has now made a difficult situation untenable. The Emergency State Response Reserve was created for exactly this kind of moment: when the actions of the Trump administration impose direct and demonstrable harm on Connecticut workers and industries. We urge the Governor to deploy it now, before more farms are lost permanently.”
Dairy farmers are paid based on the hundredweight, or cwt, which represents 100 pounds of milk — roughly 11.6 gallons. As of early 2026, U.S. all-milk prices are averaging around $18.74 per cwt, though production costs can exceed $23 per cwt for smaller farms. In many states, including Massachusetts, farmers earn a tax credit so that they are not bleeding costs because of low milk prices, essentially keeping cost of production and profits relatively even.
“Every farm closure is irreversible,” Duff said. “Connecticut’s dairy farms generate $126 million in annual economic impact, support more than 800 jobs, and contribute nearly $17 million in state and local taxes each year. These are family operations, many of them multigenerational, that anchor rural communities across the state. Trump doesn’t care about the pain of our farmers, but we do. Time to put action behind those words.”
Stephen Underwood can be reached at [email protected]