May 5, 2016
Cowboys are an independent lot. When they believe their hard-earned cash is being used improperly, it is no surprise that they'd take action.
Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America or R-CALF USA filed a lawsuit against the U.S. Department of Agriculture over the 30-year-old Beef Checkoff on May 2. The organization has long advocated for mandatory country of origin labeling (COOL) and believes that the Montana Beef Council is misusing funds collected from Montana producers because it does not advertise U.S. beef, but rather a generic product. Supporting information in the official complaint explains that, while the Checkoff dollars spent at the federal level are under some guidelines – only 5 percent can be spent on administration, and the oversight board is appointed by a government employee. In contrast the Montana Beef Council appears to have no such limit and last year spent $300,000 of the $870,000 cCheckoff dollars they collected last year on administration. Additionally the council members are named by other state organizations, with no accountability to a government authority.
R-CALF USA Membership Chairman Herman Schumacher from Herreid, South Dakota, believes that the Beef Checkoff has "gone astray."
The cattle rancher, feeder, and former owner of Herreid Livestock said that he actually helped garner support for the checkoff in 1985, the year it was created.
“We are not allowed to use Checkoff dollars to promote U.S. beef, and without COOL, consumers can’t make an informed decision. You have countries that don’t have the same standards as us.” Vaughn Meyer, Cattlemen’s Beef Board member
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"I was a huge supporter," he said. "But now we're (the Checkoff is) promoting all the beef in the world that comes into the U.S."
Shumacher and his fellow members are equally upset with what they believe is another misuse of Beef Checkoff funds – political influence asserted by the largest contractor.
"NCBA gets to lobby congress and kill COOL," he said. Last December, Congress repealed COOL, so retailers are no longer required to share information with consumers regarding the origin of beef and other meats.
The National Cattlemen's Beef Association took in $37.6 million from the Beef Checkoff last year, said Cattlemen's Beef Board member Vaughn Meyer, Reva, South Dakota. The Cattlemen's Beef Board is a 100-member body appointed by the secretary of agriculture who oversees spending of federal checkoff dollars.
As a rancher, Meyer said he feels like his Checkoff dollars are misleading consumers. "We are not allowed to use Checkoff dollars to promote U.S. beef, and without COOL, consumers can't make an informed decision. You have countries that don't have the same standards as us," Meyer said, citing a news story he read recently that told of athletes traveling to Mexico and Canada being warned not to eat beef in those countries because it could contain some of the same muscle building steroids that they are not allowed to use.
Checkoff dollars are used for good, too, Meyer said. "Consumer education and issues management are good examples," he said, citing quick and well-done responses to animal health concerns like BSE.
The Montana Beef Council was not able to comment on the litigation.
NCBA said they will not comment on the suit.
USDA would not answer any specific questions but offered the following statement:
"USDA works to ensure that Beef Checkoff program funds are used in accordance with the Beef Promotion and Research Act and the Beef Promotion and Research Order. Over the past few years, USDA has worked to foster collaboration within the Beef Checkoff program in order to maximize the amount of resources the industry as a whole can use to research and market beef products. USDA has also been working to expand markets for high quality U.S. beef overseas, which will increase opportunity for our domestic ranchers and processors. USDA will review the merits of the suit, but in the meantime we continue to press the Beef Checkoff members to reconcile their differences and work together for the benefit of the overall industry."
R-CALF USA, based in Billings, Montana, said in the opening statement of their official complaint that the "tax" is being used by the Montana Beef Council "to fund the council's private speech, harming R-CALF USA's members."
The council's speech, which is financed by a government-mandated tax, is not "effectively controlled by the government," R-CALF USA asserts. The group is made up of representatives from different Montana agricultural organizations that are not "democratically accountable," to R-CALF USA members who pay the Checkoff, said the group. In 2005 the Supreme Court determined that the federal Beef Checkoff is "government speech," exempting it from complaints that it violates the first amendment rights of its financiers.
Additionally R-CALF USA says that their members are being disadvantaged by the Montana Beef Council's promotion of generic beef, and lack of promotion or mention of the U.S. produced from cattle the group's members raise. Domestic cattle are raised under rigorous safety and handling requirements and result in a high quality product, the group said.
The organization opposes "communications espousing that all beef is equal and/or that fail to distinguish between foreign and domestic beef.
"R-CALF USA's members' methods stand in contrast to those used by large, multinational producers who source much of their cattle and beef internationally," states the official complaint.
"The Montana Beef Council is comprised of individuals aligned with some of the largest multinational, industrial cattle producers, which purchase and raise cattle both domestically and internationally. As a result, the council engages in promotional campaigns that communicate all beef is equal and it is irrelevant where beef comes from," the complaint continues.
Their members are being forced to sponsor speech that they don't agree with and would not choose to express, he said. "Members of R-CALF USA believe it is important to communicate to consumers that all beef is not equal, that it matters very much where and how beef is produced, and that consumers should prefer and select beef born, raised and harvested in the United States."
Meyer said he would be more comfortable with the Beef Checkoff if they didn't contract with lobbying organizations, and if the program would promote U.S. beef.
Federal Beef Checkoff dollars are collected in each state by a beef council. The state beef council may retain up to 50 cents of every dollar collected. Many state beef councils do not keep the full 50 cents, but send a portion to the federal level. Some states collect additional funds to be spent as they determine. Missouri beef producers just last month overwhelmingly voted down a $1 state beef checkoff. The North Dakota legislature approved a $1 state beef checkoff last year.
Schumacher said he feeds a lot of cattle that are individually identified as to dam and sometimes even sire. "These guys go the extra step to identify and to buy those bulls that grade and perform, but when it comes into the feedyard it doesn't matter, it becomes a generic product because we no longer have COOL."
Commercially produced ground beef could have meat from as many as 28 different animals originating from several different countries, Shumacher said.
"They tell you that you should participate in a voluntary program to earn a premium, but the predatory pricing by packers makes this almost impossible," he explained.