Agricultural commodity checkoff increases advance

Senators gave first-round approval March 22 to two bills that would increase checkoff funds for wheat and corn commodities.

As introduced by Holdrege Sen. Tom Carlson, LB905 would amend the Nebraska Wheat Board’s current excise tax levy of 1.25 cents per bushel of wheat to 0.5 percent of the net market value of wheat sold through commercial channels in Nebraska. The board could increase the excise tax by 0.75 percent of net market value.

The bill also would allow gifts, grants and other noncheckoff revenues to be remitted to the Nebraska Wheat Development, Utilization and Marketing Fund and would remove a restriction that limits wheat research contracts to one year.

An Agriculture Committee amendment, adopted 26-1, revised the proposed assessment rate to 0.4 percent of net market value and would authorize the board to make future rate adjustments to up to 0.5 percent of the net market value after Oct. 1, 2014.

The amendment also removed provisions of the bill that would have allowed gifts and grants to be placed in the cash fund.

Wheat prices vary greatly from year to year, Carlson said, and allowing the checkoff rate to vary with the market would help stabilize the fund, which supports research, marketing and promotion.

Sen. Chris Langemeier of Schuyler opposed making the rate variable. Because the board is appointed, he said, wheat producers cannot hold board members accountable if they increase the checkoff rate.

“I’m willing to support an increase,” he said, “but I cannot support making it variable.”

Hoskins Sen. Dave Bloomfield supported the bill, saying the board would be constrained sufficiently by having the ability to raise the rate by 0.1 percent.

“This [change] was asked for by wheat growers and I think we should give it to them,” he said.

The bill advanced to select file 28-0.

LB1057, also introduced by Carlson, would increase the current fee limit of 0.4 cents per bushel of corn to 0.5 cents per bushel levied by the Nebraska Corn Board. The board would be authorized to make future adjustments to the fee, not to exceed 1 cent per bushel.

An Agriculture Committee amendment, adopted 30-0, removed provisions that would have allowed the board to make future adjustments to the fee. In addition, the amendment would establish Oct. 1, 2012 as the operative date for the revised assessment.

Carlson said the date would coincide with the sunset date of a current 0.8 cent assessment paid by corn producers to the state’s Ethanol Production Incentive Cash (EPIC) Fund.

He said the current fee rate has not been changed for 24 years and is the lowest among the top 12 corn producing states in the country. With more resources, he said, the corn board could engage in more research, marketing and promotion.

“Nobody likes additional fees,” Carlson said. “But most growers understand what this money is used for.”

Fullerton Sen. Annette Dubas, a corn producer, supported the bill. The Corn Board helps individual producers who operate independently but share the same goals, she said.

“I don’t set aside money to promote my product … [but] collectively we can pay into this fund and it can be used to promote our business at large,” she said.

LB1057 advanced to select file 27-0.