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Indiana House approves $1 checkoff fee on cattle

 
By STAN MADDUX
Indiana Correspondent

INDANAPOLIS, Ind. — Hoosier cattle and dairy farmers would invest more money in their own industry under state legislation approved Jan. 26 by a near-unanimous vote in the Indiana House.
House Bill 1224, adopted 94-2, advan-ces to a Senate committee for further consideration. “Hopefully, we’ll have as strong of support in the Senate as we did in the House,” said Joe Moore, executive vice president of the Indiana Beef Council (IBC).
The measure requires $1 be assessed on every head of cattle at the time of sale, with all proceeds going to the IBC. Use of the funds would be restricted to promoting and marketing beef along with production, research and education.
The IBC in July 2015 voted to work with the legislature in trying to create a state checkoff program in addition to the federal checkoff program already in place. Currently, the IBC receives a share of the money from the federal program created in 1986, that also levies a $1 fee on every head of cattle at time of sale for use in areas like promotion and research.
Moore said half of Indiana’s share of the proceeds are directed to the IBC, while the remainder goes to the Cattlemen’s Beef Promotion and Research Board in Denver for national promotions. The assessment, though, has never changed, with each dollar coming in now having a spending power of just 42 cents, he said.
As a result, the revenue stream from the federal checkoff is no longer enough for the promoting and marketing of beef to make a real impact, he said. Thirteen states, including Ohio, Kentucky and Illinois, already have their own beef checkoff programs.
“It takes people and it takes dollars. That’s why 13 states have taken it upon themselves to do something about it,” Moore said.
He estimated a state checkoff would generate $150,000-$200,000 a year. “It will triple our revenue stream.”
The IBC has about 1,300 members statewide and surveys indicate more than 90 percent of them support the legislation, Moore said. Unlike the federal program, the bill provides for accountability by allowing each farmer paying into the state checkoff to get back all of the money they paid in if they choose no longer to participate. All they have to do is request a refund form and mail is to the IBC.
“We’ll return his money,” said Moore.
In addition, if at least 25 percent of the farmers request refunds for two consecutive years, the program is automatically repealed, said state Rep. Don Lehe (R-Brookston), author of the legislation. He said how the money specifically is spent within the required areas would be decided by an IBC committee.
“If there’s a lot of discontent amongst the producers that are paying it, they got a recourse and they can pursue that,” Lehe said.
He said the hope is higher prices from increasing demand that might result from greater promotion of beef. He said a checkoff also could have been pursued through a statewide referendum, but since there seemed to be wide support in the legislature, doing it at the Statehouse seemed to be the quickest option.
“I hope we get the same or similar support in the Senate,” said Lehe, who raises both grain and livestock.
3/2/2016