What? No ideas on the checkoff?

August 9, 2008 07:00 PM

Steve Cornett

You've got until the end of this month to make your views about the future of the beef checkoff program known to the powers that be considering ways to change the checkoff program.

You'll recall that the Cattlemen's Beef Board, the big daddies (and mommies) of the checkoff program, recently solicited input from some 300 different organizations. That input is rolling in a little slowly—there were 36 submissions as of last week--and if you want your individual voice to be heard, you need to get with your local board members or—perhaps easier—drop the board a line directly. You can find the list of board members at www.beefboard.org or you can drop a note to beefboard@beefboard.org with your own ideas.

So far, many of the suggestions sent Denver-ward would require congressional action and that would probably mean a new referendum. This is risky business. Approval for the program is at an all-time high and revenues at an all time low.

That should mean it's a good time to open the program for another referendum. But, Congress likes to require supermajorities for industry referenda—as it should with "voluntary” taxes—and the beef industry is not exactly united at the moment.

We've got some organizations which seem willing to see the program die rather than accept changes they consider detrimental to their personal agendas.

Too bad. That means hammering out a new program that will win approval—especially with an urbanized Congress doing the hammering—might not be easy.

That said, the CBB seems to be pressing forward. The administrative subcommittee will gather input until the first of September, then begin a winnowing process to see if they can find consensus.

One might suppose the South Dakota recommendations would be a pretty good example of what many state beef councils will ask for:

  1. Provide the ability to advertise USA born and raised beef
  2. Under a referendum or a petition for a referendum ballots shall only be available to CATTLE producers.  To receive a ballot at a local FSA, the producer must have proof of cattle ownership – sales receipts, etc.  This ballot could be available for a 10 day period to allow a time frame for the producer.  At this vote, the producer could have the opportunity to increase or decrease the dollar amount of the check-off.
  3.  All voters must be 18 years of age or older.  Enterprises which contribute $20 or more annually are eligible to participate in referendums.
  4. An Opportunity to petition for a referendum.  The beef referendum process be revised to provide producers the opportunity to petition every five years for a referendum on continuing the Checkoff.  Ten percent of beef producers signing the petition at county offices will trigger the USDA to conduct a vote within a year.  This is similar to the Soybean referendum model.
  5. An adjustment of the Checkoff rate.  To assure strong demand-building initiatives for the beef industry in the future and to offset twenty years of inflation, adjust the per head checkoff rate to $2.00.   The 50-50 split between State Beef Councils and Beef Board would remain the same.  The industry will need to approve any checkoff rate change through a referendum.
  6. Enhanced understanding of the Federation of State Beef Councils.  The Federation of State Beef Councils gives priority to enhancing its identity in order to strengthen beef industry stakeholder understanding of the Federation.  Options such as changing its name from The Federation Division to The Beef Checkoff Federation could be considered.
  7. Making the Checkoff more inclusive.  Any reference to the charter date of established national non-profit industry governed organizations be eliminated from definition (1260.113c) in the Beef Promotion and Research Order.  This will make the checkoff program more inclusive

I've got my reservations about a lot of that. For one thing, I don't see much value to simply doubling the checkoff. I've argued previously (click here to read that column if you have a few minutes to kill) that it should be tied to the value of cattle—making it easier to collect, more fair to all players and self-adjusting to inflation and cattle numbers. You can work out the details. For instance, Jerry Meyring of Alliance, Neb., sent this note about the column:

I agree with your ideas on checkoff collection (VAC).  For some time I have thought about a different system than the $1 The only thing I would change from your ideas would be to forget the breeding stock.  They will go to slaughter eventually.  Also we would need to address the importers.  It is time the beef industry gets to moving on change.

It's hard to argue with him over the purebreds, though it could be argued that a breeding stock producer profits more, per head, than a commercial cowman does when times are good. What counts is the idea of following the lead of organizations that tie their programs to value rather than quantities.

Through no fault of the CBB or promotion program, the structure of the beef industry is changing. We're meeting consumer needs with fewer cows and if the checkoff remains necked off to numbers, the program will continue to face tight budgets.

Also, I'm not sure how wise it would be to use much of the checkoff program to sell U.S. beef. It's hard to see which positive attributes could be successfully promoted, and it would be foolhardy to denigrate beef from ANY source. I'd rather see a separate, voluntary, checkoff program be established for the COOL effort.

However, I'm aware that my view is in the teensiest of minorities on that.

I'm not a fan of generic beef promotion anyhow. The issues management, industry promotion and research projects have had much more positive impact than the ads. Not that the ads aren't fine. It's just that things like new beef cuts and keeping consumers at ease about mad cow disease have done more good than has the fact that "it's what's for dinner” has become a catch phrase.

Otherwise, I'm not much at odds with South Dakota. I don't share their view that NCBA has too much control over the program, but there's probably not much chance of a new referendum passing without that change.

But we need to get on with this effort, one way or another. The program needs more money.

Steve Cornet is editor emeritus at Beef Today. You can reach him via e-mail at scornett@farmjournal.com.


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