Beef Checkoff Effort Resumes
Chris Clayton DTN Ag Policy Editor
Wed Jan 21, 2015 04:20 PM CST
(Page 1 of 3)

OMAHA (DTN) -- Cattle producers would get to vote on whether to increase the beef checkoff before it would go into effect under the latest proposal to double the $1-per-head fee to $2.

Agriculture Secretary Tom Vilsack last fall attempted to push for a second, separate beef checkoff program only to see those efforts blocked by Congress. (Courtesy logo)

Members of the eight organizations comprising the Beef Checkoff Enhancement Working Group were sent a proposal last week in the latest effort to reach industry agreement on ways to increase beef checkoff revenues.

The latest proposal would require going to Congress to change the 1985 Beef Promotion and Research Act and Order. If Congress adopts legislation, then a national referendum by beef producers would vote on whether to increase the fee.

Under the plan, producers would be able to request a refund of that additional fee, but not the current $1 fee, the memorandum of understanding (MOU) states.

This latest effort comes after an acrimonious fall during which Agriculture Secretary Tom Vilsack attempted to push for a second, separate beef checkoff program only to see those efforts blocked by Congress.

Members of the Cattlemen's Beef Board, National Cattlemen's Beef Association and American National Cattlewomen also will gather in early February at the 2015 Cattle Industry Convention in San Antonio.

The MOU would seek to allow the secretary of agriculture to issue a 30-day window every five years in which beef checkoff payers could request a referendum. If 10% or more of checkoff payers requested such a referendum, then a vote would be held to continue or change the fee.

Scott Stuart, CEO of the National Livestock Producers Association, serves as co-facilitator of the Beef Checkoff Enhancement Working Group along with Forrest Roberts, CEO of the National Cattlemen's Beef Association. National Livestock's board of directors has voted unanimously to support the MOU as it is, Stuart said.

"We've been at this for three solid years in trying to find some solutions to an enhancement, and I think really what we arrived at is something that should be palatable to the beef industry," Stuart said.

The $1-per-head fee is losing its effectiveness on a lot of fronts. For one, $1 has the same buying power as 48 cents in 1987. A steadily declining national cattle herd has reduced revenue as well. Half of the $1 fee in most states goes to the state beef council. The other half goes to the Cattlemen's Beef Board, which then contracts to spend about $40 million a year.

A sticking point, however, remains when it comes down to control of checkoff dollars and how are they distributed. The latest MOU structures the Beef Promotion Operating Committee with 20 members, including the chairman of the Cattlemen's Beef Board and chairman of the Federation of State Beef Councils. The 18 remaining voting members of the operating committee will come from a nominating committee, but the operating committee members from members of the CBB and the Federation.

So critics of the proposal say the MOU makes changes to who can be on the nominating committee, but the operating committee will still come from the same set of people as it does now.

NCBA is the dominate contractor chosen by the operating committee annually for funds for promotion, research and information. According to the checkoff board's fiscal 2013 annual report, NCBA was contracted for $33.66 million out of $34.49 million in contracts, a ratio of 97%. For FY 2015, NCBA will be contracted for $27.8 million. The next highest contractor was the U.S. Meat Export Federation, which received about $7.7 million.…

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