UPDATED - Potential Impacts of ASA Call for Soybean Checkoff Investigation

December 9, 2008 06:00 PM

via a special arrangement with Informa Economics, Inc.

Situation could bring focus on other checkoff programs; USB issues strong response

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.

Updated to reflect response from USB

The decision by the American Soybean Association's (ASA) board to unanimously request an investigation and financial audit of the National Soybean Checkoff Program could be a key development for these programs in general. The ASA petition was delivered to USDA Secretary Ed Schafer today, and asks for the investigation to be conducted by USDA's Office of the Inspector General (OIG).

According to a release from ASA, allegations include the improper and wasteful expenditure of both checkoff and federal funds; potential evasion of mandated salary and administrative spending caps by USB; conflicts of interests at USB; use of checkoff funds for prohibited purposes by USB; and wasteful and excessive spending by USB. There are additional allegations concerning improper USB oversight and tolerance of actions that have taken place at the USSEC, an entity created by USB and ASA in October 2005. These allegations include improper conduct by a USSEC employee at USSEC functions; the firing of whistleblowers; improper employee relationships; contracting violations; management malfeasance and the inability of ASA Directors serving on USSEC Board to obtain an independent and objective investigation of the allegations.

"Serious ethical, legal, and financial allegations have been raised about how farmer checkoff funds and program activities are being conducted," said ASA President John Hoffman, a soybean producer from Waterloo, Iowa. "These significant allegations have caused ASA to ask the Inspector General to conduct an investigation and audit so that the basis of the allegations can be impartially investigated to find the truth."

Here's a link to read more.

The USB issued the following response to ASA's call for a checkoff program Investigation:

"The allegations made by the American Soybean Association against the United Soybean Board (USB) regarding mismanagement of farmer checkoff dollars are categorically untrue. Today, U.S. soybean farmers enjoy record demand both here and abroad for their soybeans, through the fiscally responsible efforts of the farmers who serve voluntarily on USB. If the U.S. Department of Agriculture (USDA) deems it necessary, USB welcomes a USDA Office of Inspector General audit of any and all of its operations, contractor operations and projects. We would encourage all U.S. soybean farmers to learn more about how USB and the soybean checkoff program operate by visiting www.unitedsoybean.org, the only official website of USB and the soybean checkoff program.

Comments: There have been questions raised about other checkoff programs in the past, and this latest development will potentially bring a re-focus on other checkoff programs that use grower dollars to fund various research and promotion efforts. Expectations are that some populist-minded lawmakers will likely seize on this latest development and start issuing statements and press releases on the need to focus on how these programs are operated overall.

And, it will be interesting to see if the incoming Obama administration decides to wade into this matter or not.

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.


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