North Dakota legislature says ‘yes’ to state beef checkoff
March 26, 2015
With just two "no" votes in the state Senate, a bill to create a state beef checkoff in North Dakota will likely become state law soon.
HB 1238 will return to the House for a second vote because an amendment to ease the refund process was added in the Senate. On Feb. 17, the House approved the original bill 69 to 22.
Assuming the House approves the amended version of the bill, it will head to the governor's desk for a signature.
The bill, sponsored by senators Bowman, Dotzenrod, Erbele, Flakoll, Heckaman, Wanzek and representatives D. Johnson, B. Anderson, D. Anderson, Boe, Kempenich, Pollert, creates a second, $1 state beef checkoff in addition to the current federal $1 beef checkoff already collected nationwide.
The North Dakota Stockmen's Association (NDSA) garnered legislative support and urged passage of the bill.
"It has been a long conversation in our industry about the time and need for a checkoff," said the group's executive vice president, Julie Ellingson. "There are a couple of factors creating a challenge. Inflation, fewer cattle numbers, rising costs."
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Of the $1 federal beef checkoff, each state, including North Dakota, is required to pass on one-half to the federal level and the state's individual beef commissions or councils determine how to spend the remainder of the funds. The Act and Order requires that all beef checkoff money be used for promotion, research and education regarding beef.
Ellingson said members of her group support the state checkoff because they believe cattle producers in their state are missing out on opportunities to fund research and education.
"We haven't been able to contribute to some of the cool things they are doing. Other state checkoffs have contributed to studies being done in our state," she said.
On the national level, some groups hope to gain support for an increase in the federal checkoff program. Should they succeed, the North Dakota state checkoff would "sunset," Ellingson said.
Senator Bill Bowman of Bowman, North Dakota, said he agreed to co-sponsor the bill after being asked by Ellingson. "The whole key was for those that don't like it, they can get their money back. Hopefully it will be used right and get more people interested in beef."
Bowman said ranchers at the local sale barn stopped him to ask him to support the bill. "That is a pretty good indicator," that the bill is producer-backed, he said.
But the Independent Beef Association of North Dakota (I-BAND) says producers were bypassed throughout the entire process. "I-BAND repeatedly asked North Dakota legislators to model this measure after those in other states which include an opportunity for producers to vote on the increase before it is implemented and to restrict the additional funds raised to being spent within the state to promote North Dakota-specific beef. Legislators did not find any value in those provisions and argued that a refund provision is a substitute for the producers' right to vote," said the group's president Larry Kinev in a news release.
Additionally I-BAND worries about a connection between the national cattle industry marketing and trade group, the National Cattlemen's Beef Association and its sister groups, the Federation of State Beef Councils and the Cattlemen's Beef Board that oversee the checkoff at the national level. "The federation falls under the NCBA umbrella. When you send your federation money in for your seat that check is written to NCBA," Kinev said. I-BAND believes checkoff dollars are directly or indirectly financing NCBA's anti-country of origin labeling lobbying efforts that contradict I-BAND policy, and supporting litigation like a recent lawsuit filed against USDA to halt implementation of COOL.
Ellingson said the board that "many layers" of oversight assure that funds are used as intended, and not for lobbying. "Producers can rest assured those dollars are audited in major ways to be sure they are going where they should," she said. Checkoff funds are not accessible to NDSA. "Stockmens has nothing to gain, directly. Our industry has everything to gain," Ellingson said, of the new checkoff funds.
Bill sponsor Rep. Dick Anderson, a McHenry County farmer, said that he heard from voters in his district that were both for and against the bill. "The majority of the people that were for it were on the stockmen's association. I was told by the North Dakota Stockmen's Association that there is no money for research so they needed to put some in there, to help with research." I-BAND members were the outspoken opponents to the bill, he said.
Anderson was under the belief that "all of the state checkoff dollar will stay in the state." But Ellingson confirmed that the state beef commission would oversee spending of the money, and that they would choose where to spend it – either in or out of state.
Kinev said the national checkoff does not support North Dakota or U.S. beef but is required to promote beef as a generic product. "I stood up in the committee meeting and asked, 'Why aren't we branding North Dakota beef?' People could start recognizing these cattle, much like the CAB [Certified Angus Beef] program. We are sitting on the best beef in the world and we send them out in a commodity program where they can't be recognized."
Effertz said the U.S Meat Export Federation has "done an excellent job for our export market." According to a recent study, every dollar invested in the export market is returned eleven-fold, he said. "I hope the board will look at adding revenues to those projects."
Kinev said his group would only support a checkoff that is de-coupled from NCBA.
Jerry Effertz, one of three North Dakotans who serve on the Federation of State Beef Councils said its board of director seats are "allocated based on the amount of investment the state puts in."
The Velva rancher who holds an ex-officio position with the North Dakota Beef Commission said travel expenses are reimbursed but that board members are not paid for their time.
Kinev said he is a member of the North Dakota Stockmen's Association and will not be requesting a refund of his checkoff dollars because the process is too cumbersome. "In our testimony, and we came out in the press and said that if they gave us a vote they could keep the refund."
He also said he hopes the additional checkoff moneys are used to promote North Dakota beef specifically. I-BAND has perhaps "been too complacent" in attending state beef commission meetings, he added. "I think we've been a little bit substandard and I think we need to go to those meetings."
According to 4.1-03-02 of North Dakota state law, at least four of the nine members on the governor-appointed beef commission will be chosen from NDSA's nominee list. There is no similar provision for I-BAND.