Legislation seeks to overhaul commodity checkoff programs, make them voluntary for participants

By Elizabeth Crawford contact

- Last updated on GMT

Legislation seeks to overhaul commodity checkoff programs
Bipartisan legislation introduced this week in both the House and Senate seeks to overhaul commodity checkoff programs, which critics say have been “hijacked” by corporate interests so that they no longer benefit small family farmers and entrepreneurs.

Sens. Mike Lee, R-Utah, and Cory Booker, D-NJ, reintroduced the Opportunities for Fairness in Farming Act of 2017 (S.741) on March 28 to crackdown on “conflicts of interest”​ and “anti-competitive practices”​ by federal checkoff programs, Lee said in a statement.

Just like its predecessor, Lee says the bill “will help level the playing field for small family farmers and entrepreneurs”​ in part by prohibiting checkoff programs from contracting with organizations that lobby on agriculture policy.

Lee explains that the legislation comes in direct response to “past checkoff program misconduct”​ that was uncovered when a Freedom of Information Request uncovered “troubling emails between the American Egg Board and top executives in the egg industry.”​  

The emails revealed a campaign​ against Hampton Creek – the maker of eggless mayonnaise brand Just Mayo. 

In response to the legislation, AEB, which previously denied​ that the actions went beyond its mandate, told FoodNavigator-USA that “in accordance with the Act and regulations, AEB is prohibited from influencing government action or policy.”​ 

While Sen. Lee acknowledges in his statement that the AEB CEO “at the center of those emails has since resigned,”​ he said “questions remain about the board’s activities,”​ and suggested reform still is necessary.

The Act, for which companion legislation was introduced in the House (HR 1752) by Reps. Dave Brat, R-Va., and Dina Titus, D-NV, also would:

  • Prohibit anticompetitive behavior and engaging in activities that could trigger conflicts of interest, and would
  • Require publication of checkoff program budgets, expenditures and means for compliance audits.

Mandatory participation targeted

The same day, Sen. Lee also introduced by himself legislation that would prohibit mandatory or compulsory checkoff programs (S.740).

If passed, the legislation would make participation in checkoff programs voluntary – a departure from the current system which requires farmers and others to pay fees that are used to promote their products through advertising and research, but not lobbying.

The Organization for Competitive Markets supports the legislation, saying that loopholes in the current system have allowed these groups to indirectly lobby Congress.

“Lax oversight by USDA has resulted in collusive and illegal relationships between checkoff boards and lobbying organizations, both of which have repeatedly used checkoff funds to influence legislation and government action despite a broad statutory prohibition against these activities,”​ OCM said in a statement.

As such, it claims, “these funds have become a cash cow for organizations that work against fair competition for family farmers.”

These funds also can be used to harm small entrepreneurs, such as Hampton Creek alleges AEB did.

A spokeswoman for the manufacturer also lauded the reintroduction of the Opportunities for Fairness in Farming Act, saying it is “a shot across entrenched ag groups,”​ and is “a major signal that reforming the system is finally on the political radar.”

In an email to FoodNavigator-USA, she added the legislation “also is a big step forward for other food innovators and players in the space, competing on [a] more level, more transparent playing field.”

In addition, she noted, at such a politically devises time in America, it is “pretty awesome to see the movement in policy on both sides of the aisle.”

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