Aberdeen American News | By Russ Keen | June 22, 2002
The U.S. government cannot force cattle producers to put dollars into a beef promotion program that says things producers don't like, a judge ruled Friday in Aberdeen.
The nationwide beef checkoff program violates producers' freedom of speech, federal Judge Charles Kornmann said in a 21-page decision handed down late Friday afternoon. He ordered the collection of checkoff dollars, which come to about $ 86 million a year nationwide, to cease July 15. Money already collected will not be returned. Kornmann's decision is expected to be appealed, perhaps all the way to the U.S. Supreme Court.
Gary Sharp, a rural Bath producer and proponent of the checkoff program, expects Kornmann's opinion to be overruled.
"My wife Donna and I are extremely disappointed," he said. "We believe it is only a temporary setback, and are confident it will be overturned." The program has boosted beef consumption throughout the United States, and the promotion must continue to keep consumption up, Sharp said.
Surveys show that more than 60 percent of producers support the checkoff, he said.
Herreid cattle producer Bob Thullner, one of the plaintiffs, is not among them.
"I can't believe it. This is great," Thullner said after learning of Kornmann's decision. "When we initiated checkoff dollars everybody thought we were going to get better prices. But it never helped the U.S. producer." The producer-funded promotions have helped meat-processing corporations keep retail sales up, but have also helped the big companies put small processing plants out of business and keep prices low for farmers and ranchers, Thullner said.
The checkoff funds are used to promote beef in general -- not U.S. beef specifically. Thullner and others argued before Kornmann in January that they were being forced to support a viewpoint with which they disagree.
Their products, they pointed out, compete with imported beef.
A producer pays $ 1 into the program for every head of cattle he or she sells. Importers pay into the fund, too, and their contributions come to about $ 8 million annually. The checkoff began as a voluntary program in the 1970s. Congress made it mandatory in 1985.
In 1999, cattlemen opposing the checkoff submitted thousands of signatures to the U.S. Department of Agriculture requesting a referendum on whether the fee should die. No vote was ever scheduled. The federal court case ensued and was held in South Dakota because it had the highest percentage of livestock producers who supported a referendum.
Defendants in the case are USDA, Ag Secretary Ann Veneman and the Cattlemen's Beef Promotion and Research Board. About half of the checkoff funds go to the beef board, which has a contract with the National Cattlemen's Beef Association. The groups came up with the popular "Beef: It's what's for dinner" slogan.
Sharp of Bath sits on the executive committee of the beef board. USDA must approve every project the beef board undertakes. The other half of the checkoff funds go to authorized beef agencies on the state level.
Those who support the checkoff program argued in court in January that the ads and educational materials put out by the national beef board constitute free speech by the government, which also has a right to say whatever it wants.
Kornmann had precedents to consider. The U.S. Supreme Court ruled in an earlier case that a similar checkoff program for mushrooms was unconstitutional because it touted mushrooms in general; producers argued some mushrooms are superior to others. On the other hand, the high court has upheld a checkoff program for fruit trees.
Herman Schumacher of Herreid was another opponent of the checkoff heard in Aberdeen's federal court.
"I am both elated and saddened," he said late Friday. "I am not against a checkoff and I am not against promotion, and the program has done one hell of a job of promoting beef." But the program has hurt ordinary farmers and ranchers, while it has helped the operators of large feedlots and processing plants since the checkoff began in 1985, Schumacher said.
"In 1985, our cattle prices were higher than they are today," he said.Aberdeen American News:
