Checkoff checking out? Groups, individuals seek petitions for Beef Checkoff referendum
• Any cattle producer regardless of age who has owned, sold or purchased cattle from July 2, 2020-July 1, 2021 is eligible to sign the petition.
• Any person younger than 18 years of age must have a parent or guardian co-sign the petition.
• A person who signs the petition on behalf of a corporation or other entity must be authorized to do so. No proxy signature is permitted.
• Any individual member of a group, who is an eligible person separate from the group, may request a referendum separately.
A number of groups and individuals launched an online petition to gain the signatures needed to require the U.S. Department of Agriculture to conduct an “up or down” vote of cattle producers over the Beef Checkoff.
The petition, which was made public July 6, 2020, must be signed by a minimum of 10 percent of the number of cattle producers nationwide. According to USDA 2017 census data, 882,692 cattle producers exist, which means 88,269 eligible signatures will be needed on the petition in order to propel USDA to carry out a referendum of producers nationwide.
A producer’s signature on the petition is not a vote to end the checkoff, but rather, it is a show of support for requiring USDA to provide a referendum that will allow for a vote to terminate the checkoff. The referendum will only take place if the sufficient number of signatures is gathered in a one-year time period.
The Beef Promotion and Research Act, passed in the 1985 farm bill, provides for the referendum option, provided 10 percent of producers agree to request it. The act says the referendum may either allow producers to vote on suspension of the Beef Checkoff, or termination of the Beef Checkoff. The petition in place is seeking a referendum on the termination of the checkoff.
Fort Pierre Livestock owner and president of the South Dakota Livestock Auction Markets Association Bryan Hanson said he is hoping for at least 150,000 signatures on the petition, to ensure that there are extras.
Hanson said he wasn’t alone in putting together the online petition. Producers and salebarn owners from across the country teamed up. He particularly notes Steve Stratford, Stratford Angus, and assistant manager at Pratt Livestock in Pratt, Kan.
Stratford said that although, in 1984, U.S. ranchers were “beef producers,” they are now “cattle producers.”
“In the last 15 years or so, ranchers and packers have been in competition with one another. I don’t think we can be represented by the same dollar,” he said because of consolidation at the packing level, foreign ownership of meatpacking companies, and increasing percentages of imported beef and cattle.
Stratford pointed out that producers have steadily lost their share of the retail margin. He supports the concept of a checkoff that does something different.
“If we could figure a structure and way to manage it so it doesn’t get eaten up with bureaucracy, salaries and conventions and so it fights for producers, yes, I think it could be $2 or $3 dollars, if we used it to fight for producers’ market share,” he said.
Stratford said Nick Nesson of Mount View Ranch, Tennessee, did the legwork with USDA to get the petition up and running.
Twenty years ago, the national Livestock Auction Markets Association gathered signatures for a Beef Checkoff referendum, but almost 40,000 of the signatures were not accepted by USDA. Hanson said he and the other petition supporters don’t intend to let that happen this time.
In the 2000 petition drive, support for the referendum was strong in South Dakota, with nearly half of eligible producers signing the petition.
Nearly every South Dakota auction barn, along with state and national organizations such as the South Dakota Stockgrowers Association, Independent Cattlemen of Wyoming, Colorado Independent Cattle Growers Association, Independent Beef Association of North Dakota, Independent Cattlemen of Nebraska, Buckeye Quality Beef Association, R-CALF USA and more signed a letter to inform USDA of the petition.
Hanson said he personally hopes the referendum succeeds in ending the checkoff.
“My intent is to kill it. That’s why we’ve gone forward with putting a petition together. They claim there are 80 percent of producers in favor of it. I want a vote to see if that’s true.”
Hanson said he rarely talks to a producer who supports the checkoff. One reason he personally wants to terminate the program is because the Beef Checkoff does not promote USA beef in the United States.
R-CALF USA Checkoff Committee Chairman Vaughn Meyer agreed, and so do the members of his organization. “We want to promote USA beef, which was the intention of the checkoff in the first place,” Meyer said.
Additionally, the current checkoff is “non-functional,” said Meyer, the owner of Sodak Angus, Reva, S.D., citing declining producer numbers and lessening consumer consumption of beef. Meyer also pointed out that, based on the results of a recent R-CALF USA lawsuit, it was discovered that several state beef councils were being mismanaged and utilizing private speech, even though the checkoff, according to the Supreme Court, produces “government speech.”
While some organizations might say that the checkoff can be tweaked, rather than shut off “cold turkey,” Meyer, said he and others have put significant efforts into this very thing.
“I’ve tried changing it. Personally. I sat on the state beef council for 11 years, and on the Cattlemen’s Beef Board for six years. The way the act and order is set up, we don’t have the power to make changes within because of the fact that the National Cattlemen’s Beef Association controls the operating committee.”
The NCBA is the biggest Beef Checkoff contractor. The organization was granted around $27 million last year for project proposals submitted. The organization has a number of staff members dedicated solely to carrying out the beef promotion, research and education projects it bids for. An additional approximately $10 million in checkoff funds are generally submitted to the NCBA’s federation committee from state beef councils.
NCBA’s president, Marty Smith, a Florida cattle producer and attorney said that the petition effort is “troubling,” and that if the petition succeeds in forcing an up or down vote of producers, it will waste valuable checkoff dollars. According to the law, checkoff funds must compensate USDA for the cost of conducting a referendum.
“Early estimates are that we’ll spend $250,000 or maybe more, we’d rather see that being used for research or advertising,” he said.
It would be a surprise to learn that producers don’t support the checkoff, Smith said. “Given the regular surveys and polls as part of the checkoff program, we’re showing consistently 85 percent approve of the checkoff and support it,” he said, adding that even regionally, NCBA has never seen a poll or any survey results that would indicate any type of large number of cattle producers upset with the program.
Smith said that according to a study the checkoff is required to conduct annually, the Beef Checkoff returns producers about $13 per head, so he figures that without the Beef Checkoff, the industry would see about $1 billion in adverse impact every year.
Justin Tupper who manages South Dakota’s St. Onge Livestock Auction and serves as the president of the United States Cattlemen’s Association said his group, at this time, does not support a referendum to end the Checkoff.
“We would like to see some reform, but we’re not going to sign on to getting rid of it at this point,” he said.
USCA obtained a contract for over $300,000, via the CBB this year to study consumer meat demand, along with Kansas State University.
According to the Beef Promotion and Research Order, the rules under which the checkoff operates, cattle owners must remit $1 every time a beef or dairy animal changes ownership. In most cases, state beef council organizations collect the funds. The state organizations are required to send 50 cents of every dollar to the Cattlemen’s Beef Board, a group of representatives appointed by the U.S. Secretary of Agriculture, who oversee the management of the funds. State beef councils can use the remaining 50 cents to fund programs of their own. Many of them remit a portion of their half of the funds to the NCBA’s Federation of State Beef Councils, where they are able to secure board “seats” based on the amount of money submitted.
There is no standard setup for the state beef councils, and the recent R-CALF USA lawsuit pointed out that, while federally mandated checkoffs are considered “government speech” because they are under USDA oversight, some of the state beef councils were not under government oversight, which means they were not producing government speech. R-CALF asked the court to declare these state beef councils unconstitutional. The Montana Beef Council, the first one in question, was required for a time to stop retaining their portion of the checkoff unless approval had been granted by the payer (during this time, the entire $1 was forwarded to the national level CBB). As a result of the lawsuit, the USDA produced a Memorandum of Understanding with the state beef councils in question, including Hawaii, Indiana, Kansas, Maryland, Montana, Nebraska, Nevada, New York, North Carolina, Pennsylvania, South Carolina, South Dakota, Texas, Vermont and Wisconsin to ensure that USDA is now overseeing their research, promotion and educational activities.
Hanson said all signatures will be gathered electronically, and he and his staff at Ft. Pierre Livestock are available to help anyone who might need it.
“I have a tablet device on the counter at the salebarn, and I encourage other salebarns to do the same.” Hanson said his office staff will help anyone wanting to fill out the form.
Any touch screen such as an apple phone, an android phone, or a tablet can be used to sign the petition, using a finger or a stylus pen he said. Home computers can also be used, and the signer will use a mouse to create his or her signature.
NCBA’s Smith urges caution.
“I would ask anyone looking at this, let’s look at the facts and not just the rhetoric. One thing we’ve developed is the export market,” he said, and even in today’s environment of record-high boxed beef prices and low fat cattle prices, Smith believes there is evidence that meatpackers pay more for live cattle when they make higher profits on the beef they sell.
Meyer, however, said ending the checkoff will ultimately help American ranchers. “This checkoff was sold to producers as a way to promote USA beef. We never intended for it to promote generic beef,” Meyer said.
Producers deserve “a seat at the table” to make decisions about how checkoff dollars are spent, Meyer said. “We’re not seeking reform, we’re seeking an up or down vote. We’ve tried before and the only way to get a new checkoff is to kick it out and start over.”
Those interested can go to WeNeedABeefCheckoffVote.com to sign the petition. ❖