Checkoff check-in

For over 55 years, the Minnesota Beef Council has been promoting beef and its benefits to consumers, their efforts supported largely by beef checkoff funds. As new generations of educational and financial hurdles arise, the MBC is calling for a state referendum which, unlike the federal checkoff, can be refunded at the producer’s request.

“We know the (MBC) hasn’t had any increase in their checkoff fee for over 30 years,” said Christina Iliev with the Minnesota Department of Agriculture. “We now have 12 commodity councils in Minnesota, five of which currently have a refundable checkoff, so if this does pass, beef would be considered the sixth council with a refundable checkoff.”

While the MBC knows the implementation of a state checkoff is asking more of Minnesota producers, they believe the gains from this measure will outweigh the cost.

“We take this very seriously,” said Kelly Schmidt, chief executive officer of MBC. “Our whole board is made up of beef producers. Our staff here all come from beef backgrounds; we have a love for the beef business, so we don’t take an effort like this lightly.”

Minnesota beef producers will be asked to vote in 2026 on a proposed checkoff increase of 50 cents per head for their state only, activating a state checkoff alongside the federal — which will remain in place regardless of the voting outcome. State statute requires a producer referendum before a checkoff can be modified. In 2014, the MBC pursued a similar referendum, but it did not pass.

One major factor that would separate the federal beef checkoff from the state checkoff is that the latter would be refundable. After July 1, 2026, if a producer wants a refund of the 50-cent state checkoff, they would need to mail or email a refund application, available on the MDA website, within 60 days of the sale. Then, the MDA and MBC have 30 days to process the request.

“It’s up to every producer,” Iliev said. “Maybe they need money, maybe they’re struggling and would like to collect that 50 cents back per head or maybe they don’t agree with the increase, but every producer has the opportunity to request the refund.”

An in-person hearing on the checkoff was already held in St. Cloud Dec. 5, but there are two virtual hearings scheduled for 7 p.m. Jan. 14, and at noon Jan. 30, registration for these can be found on the Commodity Research and Promotion Councils page of the MDA website.

“We’re happy to hear any suggestions or feedback,” Iliev said. “If someone’s not able to attend the hearings and would like to submit comments at a different time, they can always reach out directly.”

Producers who wish to vote in the referendum must be listed on the MBC’s producer list, which can be done through their website or by phone. Dairy and veal producers are also eligible for registration.

“The beef and dairy industries are directly impacted by this,” Iliev said. “If you’re a dairy producer, you’re most likely a beef producer except for certain instances, so requesting a ballot and making sure you’re on the council’s producer list will ensure you receive a ballot and are able to participate in the election in March.”

The deadline to request a ballot is Feb. 12. The ballots will be mailed March 30, and they must be postmarked for return by April 20. The referendum’s results will be released May 19.

Minnesota’s first mandatory beef checkoff was voted into law in 1969 with the backing of beef producers. With this 50-cent checkoff, beef producers were able to create the MBC to promote Minnesota beef and grow consumer demand. It was not until 1986 that the $1 federal mandatory beef checkoff was implemented. When it was, the state checkoff was put in abeyance, and the MBC has benefitted from the federal checkoff.

Whenever a beef animal is marketed in its productive life, $1 per head is collected through the federal beef checkoff, which then goes through the MBC office. Dairy cows purchased for milk production are not subject to the checkoff, but dairy cows and veal calves sold for slaughter are subject to it. Out of every dollar, 50 cents stay in Minnesota while the other 50 cents go to the Cattlemen’s Beef Board in Denver, Colorado, which focuses on promotion efforts nationwide.

Between July 1, 2023, and June 30, 2024, the MBC received $746,061 in Minnesota beef checkoff funds; the addition of late payment fees, interest income and miscellaneous income raised the MBC’s overall revenue for the period to $753,753.

Because the checkoff is mandatory, so, too, is its oversight. The U.S. Department of Agriculture and the U.S. Secretary of Agriculture watch over the checkoff funds at the national level, while the MDA and the Minnesota Commissioner of Agriculture, Thom Petersen, watch at the state level.

Checkoff funds are required to be used in four major areas: educating consumers on beef; promoting beef domestically and globally; investing in research for beef quality, safety and sustainability as well as consumer habits and nutrition; and communicating with beef producers on how their checkoff money is being used to create and build beef demand. The MBC has many programs that fall under these four categories, everything from website maintenance and online presence to on-the-ground consumer events.

“There is state statute and federal statute that very clearly say how checkoff funds can be spent,” Schmidt said. “We can’t just make this up as we go. … We have to stick to those (four) areas. We have an annual third-party audit that reviews our financials, … and we have a very strategic marketing plan our board helps create and signs off on.”

By the checkoff program’s estimates in 2023, a lack of checkoff demand-driving activities from 2019-2023 would have reduced beef demand by 2.4 billion pounds domestically and 372 million pounds for international export.

The federal $1 checkoff has not been adjusted in its lifespan. While today’s cattle market and prices are good, cattle herds are as small as Schmidt has seen in many years, which means the MBC checkoff revenue has remained flat while inflationary pressures and business expenses rise.

“We can’t do as much with the dollar as we were able to do 10, 20, 30 years ago,” Schmidt said. “We can’t sell memberships; all we can do is rely on the checkoff funds coming in.”

If the referendum passes, there are three main areas the MBC wants to expand on: working with healthcare professionals, especially with informational toolkits; growing video resources; and conducting production research to help producers be more efficient, which state checkoff funds would allow but federal funds do not.

“We’ve always had a wish list of things we’d like to do but simply haven’t had the revenue and resources to do,” Schmidt said. “The other thing we would do is use the money and put more toward the things we know we’re doing well.”