Beef checkoff MOU advances to Congress
After their meeting in December, the Beef Checkoff Enhancement Working Group (BCEWG) finalized and released a Memorandum of Understanding (MOU) to the members of the organizations involved.
“All of the organizations went back to their members to review MOU, and we had a follow-up meeting on March 12-13,” says Scott George, a past president of the National Cattlemen’s Beef Association who has been integrally involved in the discussions. “After we reviewed what our organizations decided seven of the eight groups involved in the discussions agreed to sign on.”
The BCEWG has worked over the past several years to search for solutions to improve the beef checkoff across the nation, and this latest MOU, signed on March 13, will be given to lobbyists for each organization in Washington, D.C. to introduce this legislation for Congressional action.
“We will work to find people to sponsor a bill in the House and Senate and work with the Ag Committees,” George continues. “It has been interesting to see all of these groups coming together to get this done.”
Checkoff changes
The MOU describes a number of changes to the beef checkoff to enhance the checkoff and would provide more support for the beef industry.
One of the major changes is the increase of the checkoff from one dollar to two dollars per head.
These funds would be collected just as they are today.
Fifty percent of funds will go to the national level and 50 percent staying with the state beef councils.
“We want to make sure the one dollar we have now stays the same,” George explains. “The second dollar will be refundable. If producers don’t like the increase, they can ask for the second dollar back.”
“That is a really important provision,” he continues of the refund provision. “There are several reasons for it.”
Refund mechanism
George notes that it is important for producers who aren’t supportive of the additional dollar to have a refund provision.
“The fact that producers have the right not to participate is important,” George says. “We also hope the refundable dollar will help move the checkoff through Congress.”
Because some members of Congress aren’t particularly supportive of checkoff programs, a refundable provision could be helpful.
One of the challenges of a refundable extra dollar is the mechanism by which a refund would occur, but George notes that groups are working together to sort out the details.
“It is a collaborative process to try to figure these details out,” he says.
Operating committee
Another major change is in the structure of the checkoff.
“At the national level, the Beef Promotion Operating Committee (BPOC) decides how the dollars collected in the checkoff will be spent,” George explains. “The groups on the BCEWG wanted to be involved in the selection of the BPOC.”
As a result, the BCEWG proposed a restructured joint nominating committee.
“We proposed a joint nominating committee,” he says. “There will be seven representatives on the Cattlemen’s Beef Board and seven representatives from the Federation of State Beef Councils, just like there are today.”
However, the BCEWG also added seven industry representatives to sit on the committee to interview candidates for the BPOC.
“It would take a two-thirds majority vote to take the names forward,” George comments.
George emphasizes, “This is an inclusive move to try to get the industry more involved in checkoff programs. This is a wonderful tool to help get people closer to the checkoff and increase their understanding of what is happening.”
Referendum
Another important change highlighted in the MOU is the addition of a producer referendum.
“In the current program, if 10 percent of producers sign a petition and ask for a referendum, that referendum is triggered,” George says. “We are leaving that measure in place, but we are also adding another component.”
Similar to the soybean checkoff, a periodic referendum would be instituted. Under this situation, every five years, the Secretary of Agriculture would designate a location and time period for producers to go to to sign up to petition a referendum.
“This particular referendum could be to continue the checkoff as is, increase the assessment rate or end the program,” George notes. “This gives us the opportunity, as we go forward, to change the collection rate without requiring congressional action.”
“These changes are pretty substantial,” George says. “We’ve worked a long time, and we’ve worked hard accomplish this.”
Benefits of the beef checkoff
With no shortage of time and energy behind the work that the Beef Checkoff Enhancement Working Group (BCEWG) has completed, Scott George, a cattle and dairy producer from Cody and past president of the National Cattlemen’s Beef Association, notes that he is passionate about the checkoff and its impacts on the industry, and the effort has been worthwhile.
“This checkoff has been the greatest salvation for the beef industry,” he comments. “I’ve seen the benefits it brings to us in the industry.”
When the checkoff was originally developed, it was created with the idea of fairness, state involvement and a good collaboration between the state and national level. Those principles have held strong throughout the implementation of the beef checkoff.
“The beef checkoff has turned the tide for beef consumption,” George says. “We have addressed safety concerns, such as E. coli O157:H7 and bovine spongiform encephalopathy (BSE), and we continue to work on issues like Salmonella because they are safety concerns, and they are important.”
He notes that the checkoff has provided funds for human nutrition research, consumer education and new beef products development, as well as addressing other aspects of raising beef like beef quality assurance programs.
Checkoff dollars have also gone into improving export markets, which adds value to producer’s cattle, with research showing that exports add $300 per head.
“This is really important,” he says. “We have worked in all of these areas and it has paid off. The latest results show that producers receive an $11.20 return for every one dollar invested in the checkoff.”
“We have strong demand for our product,” George comments, “and if we didn’t have this checkoff, I doubt many beef producers would be in business today.”
Saige Albert is managing editor of the Wyoming Livestock Roundup and can be reached at saige@wylr.net.
