Beef business faces petition wars

A herd of horned Herefords graze on Colorado grass as beef producers and their Beef Checkoff program comes under attack again by an organization looking to shut off the $1 checkoff that supports marketing and research and development for the beef iundustry. 

The last time R-Calf mounted a petition drive to call for a referendum on the Beef Checkoff Program, it failed because there was fraud. Then, they went to court to take out the program and failed, as the court issued a summary judgement against them. And now, they are back to give it a third try. And, already the organization has been scolded by the USDA for alleged illegal activities.

Last week, the organization, based in Billings, Montana, and run by a career beef activist named Bill Bullard and his daughter Candace, filed a letter with the USDA and Sonny Perdue, secretary of agriculture, stating that they had begun a petition drive to force Perdue to conduct a referendum aimed at terminating the popular Beef Checkoff Program. R-Calf, as an organization, has long been critical of the Checkoff Program. Now, they aim to gather the required signatures of 10% of the more than 880,000 eligible cattle producers in the country. With those signatures, they can force the secretary to conduct a referendum, which is a vote of the producers. If a plurality of the votes side with R-Calf, the Checkoff Program would be dead. According to observers from all corners, that could be a virtual death blow to the cattle business as we know it.

A problem facing the industry at this point is that, unfortunately, a large percentage of the cattlemen who pay the $1 per head Checkoff levy really don’t know what they are paying for and don’t know what the program really does. Colorado Cattlemen’s Association president Janie Van Winkle sees that as a hurdle in defending against R-Calf.

“Many producers have no concept as to what the Checkoff does,” Van Winkle said Tuesday. “I spoke to a producer last Friday to get his ideas about several of the issues facing the beef community. When asked about the Checkoff, he told me that he had no idea what his $1 (per head) went toward. When I mentioned ‘Beef. It’s What's For Dinner,’ he agreed that was a good idea.”

Misunderstandings and bad information have fueled the move by R-Calf to take down the Checkoff Program, to the point that in its first go round, the organization emerged from the petition drive with about 145,000 signatures. But, upon a canvas of the signatures, it was found that at least a third of the signatures were invalid. There were duplicates and ineligible signers, according to the USDA and Agricultural Marketing Service (AMS), who did the canvassing. There were also signatures illegally obtained. Those facts prompted the USDA to issue a stern warning on this new petition effort.

“I also must inform you that inappropriate activity has infected the petition process that you initiated,” Deputy Administrator Jennifer Porter wrote in the letter to petitioners. “Specifically, AMS has been provided evidence that indicates producers will be entered into a drawing to win $100 in exchange for sharing a post that encourages signing the petition. This action calls into question the integrity and validity of the process you are using to collect signatures. Monetary inducement is improper. Therefore, during the verification and validation process, USDA will apply additional scrutiny to petition signatures obtained through an online platform and will consider whether any signatures have been obtained subject to improper influence or coercion. If evidence of such activity surfaces, we may be unable to perform our verification function and the petition will fail. As the organizer of the petition, I must impress upon you that its success lies not only in gathering the required number of signatures, but in maintaining the integrity of the process.”

Who is R-Calf?

R-Calf stands for “Rancher-Cattlemen Legal Action Fund.” The group involves itself in lobbying and legal activity, in particular, against the government. It is made up of cattle producers, auction yards and some regional cattle grower groups, primarily in Montana, North and South Dakota, and Nebraska, as well as limited members in 15 regions. Gerald Schreiber, an Eastern Colorado cowman, represents Colorado, Utah and Wyoming. The groups motto seems to be “fighting for the independent U.S. cattle producer.”

The CEO of R-Calf is Bill Bullard, who took the post in 2001. According to his bio, Bullard has testified on behalf of R-CALF U.S.A. members before Congress and executive branch agencies, has managed numerous lawsuits on behalf of the organization, and is the organization’s registered lobbyist.

Bullard, formerly a cow/calf rancher in Perkins County, S.D., served as the executive director of the South Dakota Public Utilities Commission from 1995-2001. He has a B.S. in political science from Black Hills State University and completed a year of graduate studies at the University of South Dakota. His daughter, Candace, is the group’s marketing director. Besides memberships, she sells coffee mugs, T-shirts and other paraphernalia.

The website doesn’t give any membership data, other than to list the directors for the 15 regions of the organization. There is a reference to their newsletter being sent to 5,700 members.

R-Calf busies itself with other issues ranging from beef and horse slaughter to sheep grazing and antitrust. There is a theme that runs through the website. It can be summed up as adversarial and to use their terms “David and Goliath.” Other than lawsuit and petition references, there is no mention of the NCBA or the Checkoff Program.

R-Calf has had a problem with the Checkoff Program for at least ten years. Their issues can be summed up in these bullet points from a 2016 document on their website where they demand that NCBA and USDA:

• Prohibit lobbying groups from contracting for Checkoff dollars

• Prohibit conflicts of interest within Checkoff Program

• Prohibit using Checkoff funds to disparage other products

• Require greater transparency regarding Checkoff spending

• Require regular audits

• Make the Checkoff Program not mandatory

The website offers no deep explanation of each point. One could reference the R-Calf letter to the, then, Secretary of Agriculture, Tom Vilsack, where Bullard attempts to defeat the NCBA arguments against R-Calf with considerable vitriol and no success. In general, Bullard splits hairs with edgy legal phraseology. The USDA response addressed his points and dismissed them. Bullard and company took the matter to court. Eventually, there came a summary judgement against R-Calf, indicating that these matters have been disproven or were based on clerical errors.

We asked Mr. Bullard on Monday morning of this week for a response to some questions about the Checkoff Program petition and he had not responded by press time.

The NCBA Viewpoint

Van Winkle is blunt in her response to R-Calf: “I, personally, believe that a trade group that is focused solely on one issue in the beef business has an ax to grind,” she said. She said that she did not think such an agenda has all producers' best interests in mind.

“There are so many issues we need to be dealing with,” the CCA President said. “This infighting and pitting one producer against another is very counterproductive. Some of the beef community adversaries know that to divide and conquer is the easiest and best way to put all of us out of business.”

“From my perspective,” the CCA boss continued, “we need to focus on what the Checkoff does for us. That $1 invested nets a return of over $11 (per head). That is indisputable. When I owned a pizza shop, I invested about 15% of my budget in advertising. We cattle producers make no marketing investment in our product except the $1 Checkoff. The Checkoff is a good business decision.”

For the typical Western Slope cowman, that Checkoff tariff comes up to less than $600 a year. Adding that to the rest of the Checkoff contributors and the marketing money pool available to the industry is a fund that can influence beef eaters worldwide.

The Checkoff funds are what make the whole highly successful “beef for dinner” thing work. The program is, as Van Winkle points out, advertising and marketing, which every business needs. Van Winkle’s reference to the pizza shop recalls a simple fact, which is that individual business owners often leave out the marketing and advertising budget. In the case of the pizza shop, which was a franchise, Van Winkle followed a proven formula for successful marketing. Not only that, in franchising, the marketing pool is fed by, and benefits, all the franchisees, like the Checkoff fund does for the nearly one million cattle producers.

Colorado Beef Board member Robbie LeValley of Delta said this about the marketing of any business: “Every successful business advertises and spends dollars on research and development. The beef industry is no different and these dollars have clearly positioned the beef industry to answer consumer questions and remain innovative,” she said Tuesday.

The Checkoff dollars that R-Calf wants to kick to the curb are used for much more than T.V. and radio commercials. There is a test kitchen where new recipes are developed and people are taught to prepare the meat. New beef cuts are developed, making better use of the carcass. That kitchen works hand-in-hand with the dietary and nutrition research group at NCBA.

Other programs include a substantial foreign marketing campaign that has managed to increase the export of high-quality beef to other countries.

Apparently, R-Calf doesn’t like the idea that the program is administered by the USDA. But Van Winkle points out that the USDA is hardly the driving force.

“Many producers figure that the dollar goes to the government, because the brand inspector collects it. But, 50 cents goes to our State Beef Council for use in Colorado. The State Beef Council is overseen by a board made up of producers. We have a producer in our area, Robbie LeValley, who serves on the state board. The other 50 cents goes to the national level for promotion. That is also overseen by a board of cattle people, including Colorado’s Hugh Sanburg from Eckert,” Van Winkle explained.

For more information about the Beef Checkoff program you can visit www.beefboard.com.

You will find more about R-Calf at www.r-calfusa.com.

Load comments