USDA Advancing Beef Checkoff

Department Seeks Public Comments on Crafting New Checkoff

Chris Clayton
By  Chris Clayton , DTN Ag Policy Editor
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The beef checkoff generates about $80 million a year that is split between the Cattlemen's Beef Board and state beef checkoffs. (Logo courtesy of USDA)

OMAHA (DTN) -- Following through on Agriculture Secretary Tom Vilsack's demands, USDA will post a notice in the Federal Register on Monday asking for public comments on creating a new beef checkoff.

Producers or others would have until Dec. 10 to submit comments on a proposal for a beef checkoff program that would operate in addition to the current checkoff program.

According to the notice, a referendum on the new checkoff would be held three years after it starts collecting fees from producers to determine if it should a continue. A second referendum would then be held seven years after the start of the program.

The notice explains that for more than three years, a "Cross-Industry Working Group" has been trying to come up with ways to increase funding for the current beef checkoff and find ways to amend the Beef Promotion and Research Act of 1985. The group disbanded in 2013 but came back together this year. Still, the working group has been unable to reach terms on ways to modify the current checkoff and increase the $1-per-head fee assessed when an animal is sold. Vilsack told members of the group on Sept. 30 that he was pursuing a new checkoff under the 1996 act.

The beef checkoff generates about $80 million a year that is split between the Cattlemen's Beef Board and state beef checkoffs. Revenues have declined because of the smaller cattle herd. The $1 fee also has not changed since the 1985 law was enacted, which means the fees have not kept up with inflation over the last three decades.

Some groups have aggressively opposed Vilsack's efforts, particularly the National Cattlemen's Beef Association and its 45 state affiliates. NCBA has written letters, held news conferences and held a town-hall meeting on the USDA proposal Thursday night. The group also created a petition -- "Don't Hijack the Beef Checkoff" -- on the White House website that has just under 1,000 signatures.

"The Secretary's plan for a second beef checkoff is duplicative and would only prove wasteful of producer dollars," said Bob McCan, president of NCBA and a cattleman from Victoria, Texas. "This plan by the USDA would consolidate greater authority in federal hands and effectively remove producer control from their promotion and research efforts. Therefore we remain opposed to the administration's checkoff."

Other groups, such as the National Farmers Union and U.S. Cattlemen's Association, have backed Vilsack's efforts to work around the 1985 law by using the 1996 generic checkoff law to create a new program.

"NFU looks forward to answering the questions that have been posed by USDA on the beef checkoff, as the current checkoff program is in need of major reform. Our comments are sure to focus on the need to separate NCBA's control from the checkoff," said NFU President Roger Johnson. "The beef checkoff should be operated like the rest of the checkoff programs where the checkoff itself is not allowed to be controlled by policy organizations pushing political agendas."

Vilsack has stressed that he feels everyone in the industry working group agreed on the need to increase funding for beef promotion and research, but the various industry trade associations failed to agree on other oversight and management changes for the current checkoff. After three years, Vilsack said he feels he has an obligation to move ahead.

"Beef industry representatives agree that this important program needs more resources. USDA is stepping up at a critical juncture to help achieve the industry's goal," Vilsack said in a news release. "With this action we can boost research investments, increase beef exports, and encourage folks here at home to support American beef producers."

USDA noted the current beef checkoff would remain intact.

Some of the questions USDA wants answered from beef producers in the comment period include:

-- Who should be assessed for a new checkoff fee?

-- What should the board structure be? Who is eligible to serve? What should be the size of the board? What should be the terms of office? How should the board be selected?

-- What should be the powers and duties of the board?

-- Who has the decision-making authority? Should funding decisions be made in conjunction with other organizations such as the Federation of State Beef Councils or the current Cattlemen's Beef Board?

-- How should the assessment rate be determined? How should assessments be collected?

-- When should the referenda be conducted?

The actual posting in the Federal Register will be Monday, but the document can be viewed here: http://www.ofr.gov/…

Chris Clayton can be reached at Chris.Clayton@dtn.com.

Follow him on Twitter @ChrisClaytonDTN.

(AG/CZ)

Chris Clayton