Brand inspection concern
January 16, 2014
The South Dakota Brand Board settled on a ten cent increase of the brand inspection fee, from $.80 to $.90 in 2012, after originally lobbying for a bigger fee of $1. This past year they tried again to gain support for a $1 inspection fee and were successful, and in July the fee was upped to a full dollar.
In a KDLT online news report, board member Curt Mortenson said a drop in the state's cattle herd would mean fewer brand inspections … in western South Dakota. That's why he and other members of the Brand Board decided to increase the inspection fee from 90 cents to $1 a head.
Mortenson and other governor-appointed board members were predicting inspections of between 1.2 to 1.55 million head for fiscal year 2013 which ended June 30.
At the $.90 rate, and even at the very lowest predicted numbers of 1.2 million head, which according to news reports, is lower than reported annual inspections from the last six years and maybe longer, income would have come in at about just over a million dollars, a couple hundred thousand less than their budgeted expenses for the year. However if inspections were to fall at the six year average number of 1.5 million head, income would have sufficiently covered expenses, leaving a $35,000 cushion.
According to the Brand Board report on their website, the program actually inspected over 1.8 million head during fiscal year 2013. And some simple figuring indicates that they took in over 1.6 million dollars, a profit margin of about 23 percent. If they had been successful in their endeavor to raise the fee to $1, their income would have been around the 1.8 million dollar mark, giving them about a half million dollars excess in just one year or about a 39 percent profit margin. The Brand Board is charged with ensuring brand laws are followed including brand inspection of all cattle, horses and mules in Western South Dakota that change ownership, leave the brand area or are slaughtered.
Bill Hutchinson who ranches around White River, S.D., doesn't believe that kind of extra funding is prudent for a government-run program. However he is more concerned about the quality of the service than the cost and said he wouldn't have a problem with a fee increase if it meant an improvement in training for new inspectors and better oversight of the program by the brand board.
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"All I want at this point is a good program," Hutchinson said. He is worried that while the cost of inspection is going up, the service is becoming ineffective.
"These are producer's dollars they are taking in and spending. It is important that they spend it wisely and efficiently," Hutchinson said. He believes this means pursuing a fee increase only when it is truly warranted, not as a means of building up a discretionary fund.
Hutchinson, who said that the S.D. Stockgrowers are not actively seeking to manage the program again, also points at that during final negotiations with the Brand Board, several years ago, the S.D. Stockgrowers proposed a contract in which the organization would operate with six percent profit and the Brand Board denied the proposal, insisting that a two percent profit margin was sufficient.
Hutchinson, who worked as a brand inspector for about 20 years before the state took over the program recalls stringent training programs and a chief inspector who expected as close to perfection as possible from the inspectors. "I didn't think I was that bad of an inspector but I got my butt chewed a few times," he recalls, and he learned from each experience, he recalls.
When he worked as an inspector, training sessions were held around the state every year, Hutchinson said, and any paperwork that wasn't "up to snuff" was discussed and individual inspectors were given strict instructions on how to improve performance.
"I think there are some outstanding, experienced brand inspectors at auction barns across the state. Those full time inspectors and a lot of part time guys do a great job of inspecting and also training the inspectors working under them but as far as I can see some of the new inspectors haven't been trained as well and don't have the knowledge or tools to do their job correctly." Hutchinson also pointed out that auction barn operators often take the brunt of poor inspection practices even though they have no control over the program or the inspectors.
A May 2013 Aberdeen American news story said that Board member Bart Blum of Reliance pledged to seek a reduction in the fee if too much money starts piling up. Blum said last month that the board has not seriously discussed a fee decrease. "It has maybe been mentioned but we haven't gotten into the depth of it." "I guess it's hard to really make a judgment until we see what's going to happen down the road," he said referring to the number of cattle being sold in the coming months. Blum said that he believes the inspectors are trained but he is not familiar with the details. Blum also added, "we do not know what affect the blizzard losses will have on the program," and clarified that his comments are not representative of the board, necessarily, but are his own personal opinions.
A man who inspected for several years for the South Dakota program now brand inspects in Montana. John Bickel of Plevna said brand inspection is a tough and often thankless job. In spite of this he was insistent that every animal be thoroughly checked before he would write any paperwork. Bickel doesn't think cattle at some of the livestock barns are getting looked at as well as they should be. He even knew of cases of inspectors writing inspections "in the country" without looking at the cattle. Country inspections are generally done on cattle moving out of the inspection area of being sold private treaty rather than being sold in a Western South Dakota auction barn. "The chief knew there were guys doing that. As far as I knew nobody lost their books over it and I don't think it stopped them."
Bickel points out that the livestock investigators, both housed in Pierre (outside of the brand inspection area) are not former brand inspectors and therefore may not have a good understanding of the inner workings of the inspection program. He reported cattle moving out of the inspection area without inspections numerous times and "nothing was done about it."
The trainings he took part in were a "waste of time," Bickel said.
Rancher and former brand inspector from Box Elder, Rapid City, S.D., Matt Kammerer reports that the S.D. Brand Board showed little interest in dealing with problems he reported to them two years ago.
"I sent them a letter explaining what a brand inspector had done and it just fell on deaf ears," Kammerer said. He first shared his frustration in a public meeting, he explained, and was told by a Brand Board member that he should "file a complaint," which he did. "I had bought a potload of cows and didn't rebrand any of them. The cows had a 'bar H bar' on the right rib. My brand is a K reverse K on the right hip. So I decided to sell some of the cows and when I took them back to the salebarn a year or so later, I didn't have any paperwork with me," he admits. "I told the inspector what my brand is and I was never asked for any verification that I bought the cows. They could have easily been stolen and the inspector would have never caught it," he said.
Kammerer said the next time he hauled cows to the auction, once again some of the cows had not been rebranded and again he not asked for paperwork verifying his original purchase of the cows. "I called up the chief inspector after that and he said that I should have presented paperwork for the cows." Kammerer agreed that he "should" have presented paperwork but then explained "if I'm a damn thief am I going to have paperwork?" It is the inspector's duty to ensure that paperwork is presented before the seller receives a check, Kammerer said, or the system is not carrying out its intended purpose.
Those issues are a symptom of a bigger problem, Kammerer believes, "It is the Brand Board's job to address concerns and deal with situations that are not being handled correctly, rather than just ignoring them and hoping they will go away," he said. "The brand inspection program is not serving a purpose anymore. With what they are doing to us we just as well throw out the brand inspection program because we aren't getting what we are being charged for," he said.
Kammerer said he believes the program, which is only enforced on the West side of the river fits under the definition of "taxation without representation," because producers in the brand inspection area "are not getting a benefit" since the law in his opinion is not being enforced in some locales within the inspection area.
Another issue he shared with the S.D. Brand Board over two years ago, which has never been addressed, he said is the fact that two local meat markets, K C Meats and Piedmont Cutting Edge are not utilizing brand inspection, on "farm kills."
Many brand inspectors are doing an excellent job, but unfortunately some of the new hires receive poor or little training and oversight of the inspection program is lacking, Kammerer said.
Part time brand inspector William Davey from Rapid City, S.D., said he was hired three years ago and said, "it's not much of a training." He went on to explain that "they showed me how to fill out the papers and turned me loose," to begin inspecting. At the occasional "group" training, legal updates such as the new fees are discussed, along with other things, he said.
Former brand inspector Marvin Brink said he recently brought a carcass to Sturgis Meats for processing that he had slaughtered at home. He brought the hide along to be inspected but was told that no inspection was needed any longer. "I thought that they were required by law to inspect the hides…when I was an inspector that was a big deal," said the Enning, S.D., rancher.
Neither the chairman nor the executive director of the South Dakota Brand Board was available for comment.
Current members of the S.D. Brand Board are: Wanda Blair, Curt Mortensen, Bart Blum, Scott Vance and Lyla Hutchison. F