Source: Rita Jane Gabbett, MEATINGPLACE, 10/6/14


Members of the beef industry met with Agriculture Secretary Tom Vilsack last week and were told that because a beef industry working group has been unable to reach consensus on beef checkoff reforms, he plans to institute another beef industry checkoff program to run parallel to the existing checkoff program.

On a conference call with journalists on Friday, National Cattlemen’s Beef Association leaders expressed dismay at Vilsack’s decision and vowed to continue to work toward consensus that could avert the Secretary’s plan to move forward with his program.

Vilsack’s move comes a month after the National Farmer’s Union quit the beef industry working group, which has met for more than three years in an effort to agree, among other things, to raise the current $1 checkoff fee to $2 and to reform the governing structure of the program.     

The Beef Checkoff Program was established as part of the 1985 Farm Bill. The checkoff assesses $1 per head on the sale of live domestic and imported cattle, in addition to a comparable assessment on imported beef and beef products. States retain up to 50 cents on the dollar and forward the other 50 cents per head to the Cattlemen’s Beef Promotion and Research Board, which administers the national checkoff program, subject to USDA approval.

NCBA Chief Executive Officer Forrest Roberts explained on the call that Vilsack told the group last Tuesday he plans to use authority under broader 1996 farm legislation to create a new separate and supplemental beef checkoff program that would become effective in January 2016. He said the program would operate for three years before a referendum would be held to see if the industry wanted it to continue.

NCBA President Bob McCan and immediate past President Scott George expressed dismay at Vilsack’s plan, noting the authority he would be using under 1996 legislation would give the government more control over programs and how funds are used than the existing program under the 1985 legislation does.  The NCBA officials said while the 1996 legislation allows the Secretary of Agriculture to create a new commodity checkoff program by writing a rule, they questioned whether the 1996 legislation was meant to apply to industries with existing checkoff programs. 

The NCBA officials said Vilsack made it clear this was not his first choice on how to proceed, but it was a way forward under existing law that he could take to generate more funding for beef promotion programs in the absence of the industry’s ability to reach consensus. Congress must approve changes to the existing checkoff program under the 1985 legislation.

The parallel program Vilsack is planning would likely be funded by an additional $1 per head fee that producers would pay while continuing to pay $1 per head to fund the current checkoff program.  

The NCBA officials said they and other members of the industry working group continue to meet in an effort to agree on an alternative to Vilsack’s plan. They said the Secretary indicated he would be open to scrapping his plan if they reached a consensus on another viable way to reform the current checkoff system.

A USDA spokesman confirmed to Meatingplace that Secretary Vilsack is willing to pull back his plan if the industry reaches consensus on a viable way forward.  

"After three years in which industry organizations were not able to make progress, USDA is stepping up its involvement to support beef producers and help ensure that the checkoff program can finally move forward. Earlier this week, the Secretary met with industry groups to continue an ongoing dialogue and again make clear that if the industry could reach consensus, USDA action may not be necessary. USDA will continue to seek input and work with beef producers and industry representatives so that producers will soon have a program that provides them expanded markets, research investments, and other critical support," the spokesman said.    

In addition to funding and governing structure, the working group has been grappling with the issue of whether or not checkoff funds could be made refundable and whether the program could institutionalize periodic referendums on continuation of the checkoff program.

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