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OTA updates its Organic Checkoff proposal

The Organic Trade Association (OTA) has sent an amended proposal for an organic checkoff to the USDA AMS, which published it on their website. They have made some technical edits based on USDA feedback, plus some changes based on the nine partial proposals developed by producer groups and their supporters. The OTA changed the definition of research based on feedback from NODPA and the National Farmers Union (NFU) and they made a change to how funds are allocated to ensure that agriculture research and producer education are a higher priority. OTA continue to propose a rather complicated system of nomination of the governing Board members to represent a region based on a non-existent database of organic operations with more than $250,000 in gross organic sales in the previous year. Plus they gave producers fewer seats on the Board, and producers make up only 6 out of the 16 members. Both the allocation of checkoff funds and the final appointment of Board members is the decision of a political appointee, the Secretary of Agriculture. We are all familiar with how those decisions are made in Washington DC.

In conversations with USDA AMS, the no-organic check-off coalition of producer groups has surmised that there is no timeline for when AMS might publish a full proposal on the Federal Register. USDA did say they will accept further comment and analysis of OTA’s amended proposal which we will be supplying in the next few weeks. You have probably been bothered by “robo calls” about the organic checkoff. Producers who have tried to tell the caller that they want to register a no vote have not been allowed to. Producers who have questioned how the $250,000 figure of gross organic sales and the calculation of net organic income will be determined have been told it will be on the honor system of self-declaration. That makes it the first tax levied that is based on the honor system. You will also have received literature claiming that everyone will pay a little and that the majority of the checkoff tax will be paid by handlers/processors. Consumers, retailers, marketers, transportation companies and other service providers will pay nothing, and the system that producers know well, of trickle-down economics, will come into effect as processors pass any check-off costs on to producers with a lower pay price. Growth in organic sales is being fueled by cheap imports, some with questionable integrity, that are undermining the pay price of domestic producers. As we have said many times, if we need domestic organic production to increase we need to pay producers a fair and sustained price for their organic products.

Posted: to Policy on Tue, May 24, 2016
Updated: Tue, May 24, 2016