Update: Supreme Court Upholds Checkoff as Constitutional

Challenge of beef checkoff should also apply to other similar ag checkoff programs. Jacqui Fatka

Published on: May 23, 2005

The long-awaited beef checkoff decision has finally arrived, with the Supreme Court voting 6-3 in favor of the checkoff. The decision overturns lower court decisions by the U.S. Court of Appeals for the 8th Circuit and the U.S. District Court for South Dakota, which ruled the measure unconstitutional.

"The message set out in the beef promotions is from beginning to end the message established by the federal government," Justice Antonin Scalia wrote in an opinion joined by Chief Justice William H. Rehnquist as well as Justices Sandra Day O'Connor, Clarence Thomas and Stephen G. Breyer. The opinion explains more in-depth why the beef checkoff program is government-funded speech.

National Cattlemen’s Beef Association President Jim McAdams, says throughout the lengthy litigation process, we believed in the merits of our case and the merits of the beef checkoff. He says, "We anticipated a positive decision. This is a victory for all producers who want demand-building efforts in beef safety, nutrition and promotion continued."

The checkoff has helped grow consumer demand for beef more than 25% since 1998 and has increased the prices that producers receive for their cattle.

Under the Beef Promotion and Research Act of 1985, the Cattlemen's Beef Promotion and Research Board develops budgets and awards contracts to carry out a coordinated program designed to strengthen the position of beef in the marketplace. One such contract resulted in the highly recognizable "Beef It's What's for Dinner" campaign.

The main beef with checkoff programs

Those who opposed the mandatory checkoff program were mainly focused on the fact that the beef checkoff funding is used to advertise not just U.S. beef, but instead all beef.

But as Monte Reese, Chief Executive Officer for the Cattlemen's Beef Board, says, the philosophy of the beef checkoff is that a rising tide lifts all boats. If one sector of the beef industry benefits from increased demand, other segments will also reap those benefits.

In addition, when the checkoff program was designed, producers made it clear that they wanted everyone to pay the assessment. This means importers and imported products must also pay the $1 assessment per head or equivalent of a head for processed beef. Reese says that last year that revenue totaled nearly $8 million. "If you're going to require them to pay, you can't exclude them from the promotional activities," he says.

In addition Reese stressed that the CBB doesn't feel it's appropriate to promote beef against beef but instead as a premier option for the center of the plate choices.

Support widespread for checkoff programs

January 2005 independent research indicates that a significant 73% of beef producers support the current $1-per-head beef checkoff program. Upon the Supreme Court’s acceptance of the beef checkoff case in May 2004, an overwhelming 113 state and national beef industry and general agriculture organizations signed a friend-of-the-court amicus brief in support of the beef checkoff. The brief was also signed by attorneys general from 35 states and Puerto Rico and the chairmen of both the U.S. House and Senate Agriculture Committees.

Myron Williams, a Wall, S.D., cattleman and chairman of the Federation of State Beef Councils Division of NCBA says, "It’s clear that a majority of cattlemen and agricultural groups recognize that checkoff programs are good for local beef industries and economies."

He adds, "Cattle-Fax estimates that the beef demand gain in just the past seven years has added about $250 per head to the value of fed cattle and $200 per head to the value of calves. Consumers are willing to pay more for the high-quality beef we are producing."

Other checkoff programs expected to be included

As a result of this decision, the Beef Checkoff Program will continue without interruption. USDA is reviewing this decision to determine its implications for other first amendment challenges to checkoff programs.

Reese explains that this decision is really good news for the entire U.S. agriculture industry since over half of all commodity checkoffs are at some point in a constitutional challenge that could have ended up in the Supreme Court. "It is as good of news for other programs as they could have hoped for," he says.

A statement from National Pork Producers Council President Don Buhl says it is expected that the beef checkoff's ruling will be applied to the pork checkoff program that is also being challenged.