Leading into the National Cattlemen's Beef Association summer meeting, five major agricultural and livestock groups sent a letter Wednesday to Federation of State Beef Councils Chairman Scott George indicating they still have concerns "regarding the financial, operational, and governance firewalls" at NCBA that prevent the groups from supporting NCBA's effort to restructure its governance.

Signing the letter were the American Farm Bureau Federation, Livestock Marketing Association, National Farmers Union, National Livestock Producers Association and US Cattlemen’s Association.

The response comes after NCBA received audit results earlier this week from an independent audit firm brought in by the Cattlemen's Beef Board to examine NCBA expenses. The auditors

NCBA officers acknowledged some errors and stated that the group agreed that policies need to be followed when using checkoff expenses. NCBA officers are expected to better address the issues Thursday when meeting with reporters at the summer conference in Denver.

The letter from the five organizations to Federation Chairman Scott George follows:

Dear Mr. George:

This letter responds to the e-mail our organizations received from you earlier this week. You asked that each of us respond separately to specific questions about the proposed changes in the governance structure of the National Cattlemen’s Beef Association (NCBA) and its Federation Division of State Beef Councils. It is difficult to comment on the proposed governance and structure changes given the fluid nature of the process at this time. Over the past few months, NCBA has provided us with several powerpoint presentations indicating the status of the negotiations and proposals for moving forward. The presentations lacked detail, and therefore, we believe it is unlikely that any group can take a firm position on the new governance structure until the details are enumerated in the by-law changes.

Each of our organizations has its own concerns about the proposed NCBA governance structure changes and has provided feedback and suggestions in several meetings with NCBA representatives. Although the timeline for moving forward on these proposals has been recently delayed by NCBA, the groups’ individual concerns and positions regarding the financial, operational, and governance firewalls have been clearly communicated.

Additionally, the third-party audit released on Monday by the Cattlemen’s Beef Board (CBB) raises further questions and concerns that must be examined and addressed and will no doubt influence the larger discussion going forward. In its summary of the independent audit, CBB states that the audit “clearly indicates that NCBA breached the financial firewall during the periods tested and that NCBA did not maintain sufficient documentation in many instances to adequately support the separation of expenditures between the policy side of NCBA and the checkoff side of NCBA.” Given this finding, we believe a further evaluation is imperative and we fully support CBB’s decision to conduct a more comprehensive compliance review. We have encouraged CBB to complete that review in an expedited manner and to make their findings public.

Checkoff programs are important to all of us. We look forward to a continued dialogue so that all cattle producers benefit from the checkoff program.

Sincerely,

American Farm Bureau Federation

Livestock Marketing Association

National Farmers Union

National Livestock Producers Association

US Cattlemen’s Association

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