Some still skeptical of beef checkoff changes

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Black Angus

WASHINGTON — After nearly three years of talks, seven members of the Beef Checkoff Enhancement Working Group signed a memorandum of understanding March 13 detailing enhancements to the national beef checkoff.

Not all stakeholders, however, are in line with the proposed changes.

The United States Cattlemen’s Association and the National Farmers Union, both members of the beef checkoff working group, joined R-CALF USA in opposing the suggested checkoff enhancements.

The primary bone of contention remains a lack of needed “structural changes,” said USCA past president Jon Wooster in a March 13 news release.

Wooster said making changes to the nominating process for candidates to the Beef Promotion Operating Committee — which oversees the distribution of beef checkoff dollars — is “an integral component of securing needed checkoff reform.”

But changes proposed in the memo, Wooster said, may actually make the situation worse.

“The proposed change would intensify the current conflict of interest as national organizations contracting for checkoff dollars would be allowed a seat on the nominating committee,” he said in the USCA release.

Memo details

The memorandum of understanding was signed by the American Farm Bureau Federation, American National CattleWomen, Livestock Marketing Association, Meat Import Council of America, the National Cattlemen’s Beef Association, the National Livestock Producers Association, and the National Milk Producers Association.

The enhancements include an increase to the current beef checkoff program of $1 per head to $2 per head, implemented one year after being signed into law and only after a majority of beef checkoff payers vote to increase the checkoff.

The MOU also agrees to continuing assessment collections as they are now, with state beef councils having the authority to retain 50 percent of the assessment. The working group also agreed on making a refund of the additional assessment amount, but not the current $1 per head, available to beef producers paying into the checkoff.

The proposed enhancements also include a 30-day comment period every five years, during which beef checkoff payers may request a referendum vote on the continuation of the beef checkoff program or changes to the assessment rate.

If 10 percent or more beef checkoff payers request such a referendum, a referendum will be held.

Counter proposal

Wooster said the goal of the beef checkoff working group now seems to be an increase in the assessment with “no consideration to structural changes.”

The USCA suggests enhancements including the separation of the Federation of State Beef Councils from the National Cattlemen’s Beef Association; allowing the Cattlemen’s Beef Board to contract directly with the non-industry entities doing the work instead of requiring CBB to contract through national organizations that can then sub-contract with these entities; requiring money from state beef councils invested in federation board seats go to the Beef Promotion Operating Committee to be awarded to contractors; requiring an automatic periodic referendum every five years; and writing a new order under the Commodity Promotion Act of 1996 as “a more modern and flexible beef checkoff.”

A recommendation by Agriculture Secretary Tom Vilsack for a second beef checkoff order based upon the Commodity Promotion Act of 1996 was abandoned in December when Congress passed an appropriations bill that, in part, directed the USDA not to implement a second beef checkoff program.

Nomination process questioned

The beef checkoff enhancement working group’s memorandum also calls for a new joint nominating committee, which will recommend candidates to serve on the Beef Promotion Operating Committee.

R. Scott Stuart, president and chief executive officer for National Livestock Producers Association and a member of the beef checkoff working group, disagreed with Wooster’s claim that the new nominating committee would represent a conflict of interest.

“We have spent a lot of time digging into contracting and ensuring that checkoff dollars are not used for lobbying,” Stuart said.

Currently, Stuart said, nominations to the Beef Promotion Operating Committee are made by 10 members of the Federation of State Beef Councils and 10 members of the Cattlemen’s Beef Board.

The new 21-member joint nominating committee, Stuart said, would include seven representatives from the CBB, seven from the FSBC, and seven representatives from elsewhere in the beef industry, including four from the beef enhancement group.

“The structural changes in regard to the governance gives the industry at large (more say) in who is on the Beef Promotion Operating Committee,” Stuart said.

Timeline

Stuart said no major changes, and only a few minor ones, have been made to the memorandum since last fall. It was released in January to beef industry organizations to take to their members.

“It will require an act of Congress to amend the Beef Act of 1985, and we know with Congress that will be a heavy lift, but we hope to (have that done) by this year,” Stuart said of the next steps in the process of making the proposed changes permanent.

“Then, within a year, we will need to have a referendum for all beef producers to vote.”

Related stories:

Vilsack calls for new beef checkoff program  Oct 7, 2014

House blasts beef checkoff proposal Dec. 17, 2014

Vilsack abandons beef checkoff plan  Dec. 19, 2014

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