Some producers clamor for more transparency in checkoff programs

Published: December 11 2013 | 7:32 am - Updated: 29 March 2014 | 12:42 am in
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DEC. 10, 2013

The USDA’s Agricultural Marketing Service oversees 20 commodity “checkoff” programs. From watermelons to softwood lumber to blueberries and Hass avocadoes, myriad industries have programs—many of them mandatory—that collect fees from producers to reinvest in the promotion of the product and in research that benefits the industry.  (In addition to the federally mandated programs, corn boards operate checkoff programs in individual states.)

Millions of dollars are collected from producers to promote their products and conduct research on the industries. But some farmers are expressing concern that the precise uses of their checkoff dollars are not adequately disclosed.

In an article last month in The Gazette, a newspaper out of Cedar Rapids, Iowa, Senator Charles Grassley (R-IA), who comes from a farming background and still considers himself a farmer, said the checkoff programs ought to be more transparent about how they spend producers’ money.

“Maybe they don’t want to answer because they’d be embarrassed, but there’s people that know, and there’s no reason that stuff should be secret,” Grassley told the Gazette.

Why be embarrassed? The Gazette reported that the heads of the Iowa corn board and state soybean association each earn well over $250,000, facts that might not sit well with some less prosperous farmers.

The senator still supports the checkoff programs, a staffer told Harvest Public Media, because he believes producers do benefit from them. But he thinks it would be better to be more open about how the money is used.

Some participants complain that the return on investment isn’t spread out equally among all farmers. While reporting a story about research funding from the pork checkoff last summer, I spoke with Iowa hog farmer Paul Willis, a founder of Niman Ranch and a producer committed to a niche market for the animals he raises. He says the original idea for a small fee to promote the industry appealed to him. But with the changing dynamics of farming—in particular consolidation into larger farms—he doesn’t feel smaller producers benefit much.

“There seems to be a lot of frustration, not just with people raising pigs but with others as well,” Willis said. “The same thing seems to happen—the intention seems to be there and seems to be good in the beginning, and then it seems to get diverted over a period of time.”

Chris Novak, CEO of the National Pork Board, says producers of all sizes from all types of operations are welcome to participate in various boards and committees that influence how pork checkoff money is spent.

“We have committed to a higher level of transparency,” Novak said. In the 2013 annual survey of over 600 producers, Novak said 87 percent expressed support for the checkoff and six percent voiced opposition.

In the beef industry, some producers have been vocal about their opposition to the relationship between the Cattleman’s Beef Promotion and Research Board and the National Cattleman’s Beef Association.

Mike Callicrate, a rancher in St. Francis, Kan., is one of a group of beef producers frustrated by the NCBA’s dominant role in beef checkoff management. The Beef Board contracts with NCBA for many programs.

“They absolutely hold it with an iron grip,” Callicrate said. “No one else can get that money except the National Cattleman’s Beef Association.” Like Willis, Callicrate initially thought the checkoff program was a good idea. But now, Callicrate thinks the NCBA is not adequately transparent about how beef checkoff money is used.

On the Beef Board’s website, the 2014 budget shows 18 authorization requests. The NCBA is listed on 10 of those (sharing one with a partner organization). Five other groups split the remaining eight requests (including the Beef Board itself, which is listed under “producer communications”).

As non-profit organizations with government oversight, most of the checkoff programs have annual reports and other financial records available on their websites.

Regardless of whether they consider that enough transparency, most producers have no choice but to continue contributing to the checkoff if they stay in the business.

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