ABP, feeders work on new checkoff

Alberta Beef Producers and Alberta Cattle Feeders Association propose new agreement for sharing $2 per head levy

RED DEER — Alberta beef groups hope to have a new funding arrangement with a new level of co-operation in place by next year.

Alberta Beef Producers and the Alberta Cattle Feeders Association have proposed a New Era Beef Industry Agreement to split the $2 per head levy charged on every animal sold. However, some other industry players say they want more details.

The checkoff would be nonrefundable with $1.30 going to ABP, 40 cents to a new beef industry development fund and 25 cents to the cattle feeders. A five-cent refund would go to rebate auction markets and processors collecting the money.

The Western Stock Growers Association passed a resolution requesting a clear and detailed position on the proposal to bring back a non-refundable checkoff. All levies collected by commodity groups became refundable under law about 10 years ago but recent provincial legislation reversed the rule, allowing producer groups to decide.

Commodity group checkoffs pay for marketing, promotion and research.

Allowing individual producers to request a rebate made ABP more accountable in the way it handled its funds, said Bill Hanson of the stock growers.

“The reason we asked for a refundable checkoff was for effective use of dollars. It wasn’t that the people didn’t want to give money to the industry. Most people here would give more than what the checkoff is today if it was effectively used dollars,” he said.

The issue was debated during annual meetings at the Alberta Beef Industry Conference held in Red Deer Feb. 21-23.

Hanson argued primary producers are carrying the greatest load because the cattle feeders can adjust the price of calves to account for the levy.

“We are the ones paying it, so we should have a say in how it is spent,” he said.

Other members suggested the issue should go to a plebiscite. How the changes could be implemented are still under investigation.

Cattle feeder members also want more information.

“There are a lot of details that have to be worked out. It sounds to me like we might be a bit premature,” said Rick Paskal of Picture Butte, Alta.

More work needs to be done but such an agreement could provide stable funding for beef groups at the provincial and national level, said Ryan Kasko, new chair of Alberta Cattle Feeders Association.

“We have had a tremendous change in the political climate provincially and federally. We have a lot more complex regulatory pressures that we are dealing with like labour, farm safety and carbon taxes. We need to make sure we have an industry that is well-represented and well-funded,” he said.

The industry development council would have three representatives each from ABP and ACFA and an independent member. Money would go for research, education, market development and other issues. The new approach would be reviewed in two years and then every five years.

Staffing, offices and organizational matters would be worked out to avoid duplication of services.

Cattle feeders would remain a separate organization and would retain its own membership fee. Its share of the check-off money could be directed to the development fund.

Alberta Beef would receive about the same amount of money at around $5 million and ACFA would get about $850,000, which is about what it collects in memberships now.

The development fund could have as much as $1.4 million a year.

Bob Lowe, past-chair of ABP, said the proposed new agreement offers a way to clear long-standing distrust between beef groups.

“There has been distrust between the two organizations for a long, long time. You are not going to put it together in one year. It is a 10-year plan and you have to start somewhere,” he said.

Besides determining how to divvy the check-off money, Alberta producers will start paying more in April because the national checkoff increased to $2.50 per animal sold from $1.

Alberta, Saskatchewan and Manitoba start collecting it in April, while British Columbia starts in July.

The Atlantic provinces have been collecting it for a year, while Ontario and Quebec are still working out a model to collect their portion, said Melinda German of the Canadian Beef Cattle Checkoff Agency.

The money pays for operations at Canada Beef Inc., Beef Cattle Research Council and a new entity, Issues Management.

Under the current model, Alberta submits $3.8 million or about half of the total amount of the national fund. The other provinces collect less than $1 million each.

Claw-backs remain a contentious issue, where provinces retain money for provincial research and marketing activities. The agency’s annual report said 19 percent of the national checkoff was held back by six provinces.

“Every province that takes back money has to tell us exactly how they are spending that money,” German said.

B.C., Alberta and Saskatchewan do not hold back money but Quebec, for example, takes back nearly all the funds, which support its veal sector. Manitoba holds back about six percent.

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