USDA Dropping Checkoff Plan

By Chris Clayton
DTN Ag Policy Editor

OMAHA (DTN) — With Congress blocking USDA from spending any funds to create a second beef checkoff, Agriculture Secretary Tom Vilsack said he’s happy people within the beef industry could at least find an area of agreement.

In a phone interview Thursday, Vilsack said USDA won’t pursue efforts to create another checkoff under the 1996 commodity promotion law. A policy rider in the federal appropriations bill passed over the weekend prevents USDA from continuing to write a rule for the plan during this fiscal year.

An appropriations bill doesn’t carry the weight of law as an authorizing act, but the rider gets the point across that Congress doesn’t want a federal agency pursuing a particular policy. The secretary said people in the beef industry made it clear they didn’t want USDA to pursue a checkoff parallel to the current $1-per-head assessment.

"They agreed they didn’t want a second checkoff. That’s the first time in three years they have agreed on anything," Vilsack said. "So I hope they can build on that foundation, however shaky that might be, to figure out a way in which the differences and divisions that occur and are in the beef industry can be rectified so they ultimately come to me with recommendations for improvements and changes in the current beef checkoff so there will be a clear path to getting more resources in that checkoff."

The beef checkoff has been set at $1 since the beef promotion law was created in the mid-1980s. Inflation and a declining cattle herd have dwindled resources going into promotion and research. The program right now generates roughly $80 million a year.

Vilsack proposed another checkoff after acrimony stemming from a beef industry working group that has been trying for three years to reach a compromise to increase the checkoff fee while potentially changing how the checkoff distributes funds. Vilsack chastised members of the group for failing to compromise.

"We only proposed the second checkoff in an effort to get folks to understand what was at stake, so we will see what the industry does from here," Vilsack said. "It’s unfortunate that we have no mechanism as we speak today to obtain additional resources in the beef checkoff when everyone in the industry knows we have to do more to market, research and promote the beef industry."

Vilsack said he has made every effort to get the working group to get together and seek an agreement. He’s not sure about offering more encouragement.

"We’ve done everything we can do and they have prevented me from doing the one thing I had the capacity to do, so now it’s really totally up to the industry," he said. "They are satisfied with the current checkoff — some are satisfied with the current checkoff, some are not — but all believe we need additional money, so common sense would suggest and dictate that people get in a room and give a little bit and come out with the consensus position to increase the checkoff and do a better job of promoting, researching and marketing beef. But, at least up to this point, that’s not been possible."

Chris Clayton can be reached at chris.clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN

(AG/CZ)