The Alberta Beef Producers and the Alberta Cattle Feeders Association have come to an impasse on making the provincial checkoff non-refundable.
And that’s put the controversial matter in the hands of the provincial government.
“We’re trying to come up with a plan,” said Martin Zuidhof, chair of the Alberta Cattle Feeders Association. “That’s where it’s at yet. I would imagine that their thought is just to go to the status quo, but the cattle feeders are looking for something more innovative and progressive.”
The impasse is frustrating and damaging to the beef industry, said Bob Lowe, chair of Alberta Beef Producers (ABP).
In the fiscal year that ended March 31, his organization refunded $2.33 million worth of checkoffs — a hefty 35 per cent of the total provincial levy it collected. Producers who identified themselves as cattle feeders took 88 per cent of the refunds (just over $2 million), while the remaining 12 per cent were taken by cow-calf producers.
“Overwhelmingly, at our fall meetings, producers are directing us to get on with the process of trying to get the checkoff back to non-refundable,” said Lowe. “We really wanted to go to the government with the cattle feeders by our side, but that wasn’t going to happen at that time.”
The checkoff has been refundable since 2009. With falling revenues, ABP has lobbied the government — without success — to make it non-refundable.
At a meeting this spring, ABP proposed to the Alberta Cattle Feeders Association that a council of ratepayers be formed, which would then decide how the money from the provincial $2-per-head checkoff be distributed.
“This council would direct that money towards research, marketing, industry, and advocacy,” said Lowe, who operates Beartrap Feeders near Nanton.
Alberta Cattle Feeders didn’t like the plan, so ABP presented it to the minister of agriculture. The provincial ag ministry has indicated it isn’t opposed to a non-refundable levy, but would like ABP and the cattle feeders to jointly agree to the move.
“As far as ABP is concerned, the conversation is not ending with the cattle feeders,” said Lowe. “We’re all for whatever is best for the industry, and if we could come up with a plan that is satisfactory to both parties, that would be good.
“As far as we’re concerned, the conversation isn’t over and we have to get on with doing something.”
The Alberta Cattle Feeders, which is funded through voluntary membership, has no problem with a refundable checkoff.
“We don’t have a problem with keeping the checkoff voluntary — it keeps people responsible and accountable,” said Zuidhof, who runs a feedlot near Lacombe. “Generally, money tends to follow vision. If the beef industry has a good vision, people would leave their money in and over time, the levy would increase. It hasn’t changed for a number of years. We have to show that the money is being well spent.”
He speculates some people are requesting checkoff refunds because they don’t like the way their money is being used. His association believes ABP needs to revamp its funding model, he said.
“A lot of the ABP money is spent internally,” said Zuidhof. “You can always throw out generic statements like ‘We need more money for research, promotion and marketing.’ How are we going to do that?”
But the withdrawal of funds isn’t just hurting ABP, it’s hurting the entire industry, said Lowe.
“It takes money to fight legal challenges. It takes money for research. Governments across the board are starting to demand industry funds.
“If we don’t have any skin in the game, they won’t fund research. Industry has to fund it to such an extent before the government will put money in. It’s not ABP losing money, it’s the industry losing money.”
This article originally appeared in the July 18, 2016 issue of the Alberta Farmer Express