Lawmakers Trying to Rein in Commodity Checkoff Programs

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By Casey Wooten

Four lawmakers are taking aim at Department of Agriculture programs designed to promote commodity groups in a series of bills introduced March 29.

Reps. Dina Titus (D-Nev.) and Dave Brat (R-Va.) introduced legislation (H.R. 1753) that would prohibit commodity checkoff groups from contracting with an organization that lobbies on agricultural policy and prohibits “anti-competitive activity, unfair or deceptive acts, or any act or practice that may be disparaging to another agricultural commodity or product,” a statement from Rep. Titus announcing the bill said.

“Checkoff programs are not pots of money for corporations to use to attack their political opponents,” the statement said. “This legislation will ensure that checkoff programs are not picking winners at the expense of the sector of the agriculture community that values animal husbandry.”

The USDA’s Agricultural Marketing Service operates 22 checkoff programs for commodities like pork, eggs and dairy. Producers pay a small fee on each sale, the money going to promote the commodity or pay for research. But the programs have come under criticism because of their mandatory fees and alleged favoritism toward some businesses.

Sens. Cory Booker (D-N.J.) and Mike Lee (R-Utah) introduced a similar bill (S. 741) in the Senate.

The bills would also require the USDA inspector general and the Government Accountability Office to make audits of checkoff program budgets and expenditures available to the public.

Lee also introduced S. 740, which would make participation in commodity checkoff programs voluntary.

Both bills were introduced in the previous Congress, but didn’t advance.

Mayo Scandal

The lawmakers cite the 2015 scandal surrounding the American Egg Board, in which a Freedom of Information Act filed by the Guardian newspaper found that the group fought a campaign against the Silicon Valley-based vegan food startup Hampton Creek. The startup produced an egg-less mayonnaise it called “Just Mayo.”

“This was a classic case of Big Government and Big Business working together to squeeze out smaller rivals and squelch innovation,” Lee said in a statement.

The fallout forced the American Egg Board chief executive to resign.

The bills also come as the USDA decides whether to create a new checkoff program for organic products. Public comment for that proposed regulation is due April 19.

Supporters of checkoff groups say that when producers pool their funds the advertising and research programs benefit the whole industry.

Some producer groups criticize the programs, however, saying that the commodity checkoff system forces producers into expensive programs that only benefit large operations.

To contact the reporter on this story: Casey Wooten in Washington at cwooten@bna.com

To contact the editor responsible for this story: Paul Hendrie at phendrie@bna.com

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