FOR IMMEDIATE RELEASE:

Supreme Court rules beef checkoff constitutional

FORT WORTH, Texas, May 23, 2005―”Today’s ruling by the U.S. Supreme Court that the beef checkoff does not violate the First Amendment is good news for beef producers,” declared Dick Sherron, president of Texas and Southwestern Cattle Raisers Association.
            “It means that producers across the country can continue to pool their resources to fund the advertising and research programs that have been so effective in helping to reverse a 20-year decline in beef demand and improve the safety and quality of our beef products.”
            In a 6-3 decision, the Supreme Court ruled against a First Amendment challenge led by the Livestock Marketing Association (LMA) and the Western Organization of Resource Councils (WORC). The groups said that the checkoff “unconstitutionally compels” producers to subsidize speech with which they do not agree through a $1-per-head assessment on each head of cattle sold. 
            The question was whether the beef checkoff compels subsidies of private messages, which twice had been ruled unconstitutional, or of government speech, which is not susceptible to a First Amendment compelled-subsidy challenge.
            LMA and WORC argued that the speech generated by the beef checkoff is not government speech because it is controlled by non-governmental agencies, specifically the Beef Board and Operating Committee.
            The Supreme Court disagreed, saying, “In fact the message is effectively controlled by the Federal Government. Congress and the Secretary (of Agriculture) have set out the overarching message and some of the campaign’s elements and have left the development of the remaining details to the Operating Committee, half of whose members are appointed by the Secretary and all of whom are subject to removal by the Secretary.
            “The Secretary also has final approval authority over every word in every promotional campaign, and his subordinates attend and participate in meetings at which proposals are developed.”
            The Court also said that it did not need to address the argument that the advertisements give the impression that the respondents (LMA and WORC) endorse their message. Most of the ads are credited to “America’s beef producers,” which the court said, “contains no evidence from which to conclude that the ads’ message would be associated with the respondents.”
            The Court did say, however, that LMA and WORC may return to district court to pursue their original challenges, which were set aside after the Supreme Court ruled the mushroom checkoff unconstitutional. LMA and WORC agreed to seek a decision on constitutionality first.
            The Supreme Court explained that the mushroom checkoff was different because “the compelled subsidy funded communicative activities that were not prescribed by law or developed under official government supervision.” 
            By contrast, the beef checkoff and the rules for its operation were authorized by law in the Beef Promotion and Research Act and Order of 1985. The checkoff assesses $1 per head on the sale of live domestic and imported cattle, in addition to a comparable assessment on imported beef and beef products.
            States retain up to 50 cents on the dollar and forward the other 50 cents per head to the Cattlemen’s Beef Promotion and Research Board, which administers the national checkoff program, subject to USDA approval.
            The checkoff assessment became mandatory when the program was approved by 79 percent of producers in a 1988 referendum vote. Checkoff revenues may be used for promotion, education and research programs to improve the marketing climate for beef. 
            TSCRA will continue to keep the beef checkoff on the front burner, says TSCRA President Sherron, who personally advocated the state checkoff program approved by the Texas Legislature during its last session.
            “That’s how important it is to have an effective research and promotion program to grow domestic and global demand for U.S. beef in the next few decades,” he explained.
            “Much of the record market that cow-calf producers have experienced over the past year is directly attributable to the 25 percent increase in beef demand since 1998. Beef checkoff programs like the ‘Beef. It’s What’s for Dinner’ ads had a lot to do with that.
            “The checkoff also funded years of research and data on bovine spongiform encephalopathy (mad cow disease) to build a Web site and develop a response plan. When that first case was discovered in December 2003, the beef industry was ready. We all spoke with one voice, backed by years of scientific data. And it was all on the Web site; it just had to be turned on.
            “Checkoff funds have helped improved the safety of beef. From 1996 to 2004, the incidence of E. coli O157 infections, one of the most severe foodborne diseases, decreased 42 percent.
            “And in Texas, TSCRA, Texas Beef Council and Texas Cooperative Extension have used checkoff funds to provide free training in beef quality assurance to producers across the state.”
            Sherron said he hopes that all segments of the beef industry can put their differences aside and work together for long-term profitability. LMA and WORC have not yet indicated whether they will pursue their original suit filed five years ago challenging validation of signatures on a petition to call for a new checkoff referendum.
            Texas and Southwestern Cattle Raisers Association is a 128-year-old trade organization whose 13,000-plus members manage approximately 5.4 million cattle on 70.3 million acres of range and pasture land, primarily in Texas and Oklahoma.

TSCRA-22-2005