You may recall there was considerable gnashing of teeth amongst farmers and legislators before the current corn checkoff was instituted. It was preceded by a volunteer checkoff authorized by the legislature that raised only a limited amount of funds. The current check-off required money be collected one ach bushel sold at the point of first sale, with provisions for refunds for those who don't wish to participate.
One of the stipulations included to obtain passage of the bill was that the percentage of refunds would be examined after the first three years of the checkoff. If refunds were above a set percentage (app. 25%), then the legislature would reconsider the checkoff. That first three-year period has come and gone, and the check-off passed with flying colors. Refunds on an annual basis are far below the amount that would trigger reconsideration of the checkoff.
According to Megan Kuhn with the Indiana Corn Marketing Council, the refund has averaged about 10% during the first three years. This is 10% of money collected. The money is collected at the point of first sale and sent to the Indiana Corn Marketing Council. The Council does not receive money directly from farmers.
During the 2011 fiscal year recently concluded, the refund was 8%, Kuhn says. Some tweaking in administrative portions of the corn checkoff legislation passed this year affect how small refunds will be distributed.
Under the original law, someone requesting a refund had to receive that refund within 30 days. However, some refunds are so small they amount to less than $25. It increases administrative costs for the Council if they have to send a check monthly for less than $25. What the new legislation does, Kuhn says, is give the Council discretion on how to handle small refunds. If the Council chooses, they can wait until the farmer accumulates $25 before sending the refund, instead of being forced to send it within 30 days.
Now the farmer requesting a refund who only has a small amount coming will receive it once it reaches a total of $25, or twice annually, even if it is less than $25, Kuhn says. At some point, the farmer who requests it will receive the refund, even if it's for a small amount. "The Council will not be keeping their money," she explains. "That was not the intent. It was just to be more practical and allow us to cut down on administrative costs so more of the money we collect can be devoted to projects."