Round two of the checkoff spending dispute

The Cattlemen’s Beef Board, NCBA and USDA appear ready to resolve discrepancies in NCBA’s allocation of Beef Checkoff funds, but R-CALF says “not so fast.”

During last year’s Beef Industry Summer Conference in Denver, contentious discussions of NCBA’s apparent misspending of some Beef Checkoff funds dominated several sessions and hallway chatter.

You might recall that on July 26, two days prior to the conference, the Cattlemen’s Beef Board issued a news release outlining results of its review of NCBA’s checkoff spending and apparent discrepancies therein. At that time, the audit had uncovered about $37,000 in NCBA expenses mistakenly billed to the checkoff, from $115 million in checkoff spending during the 29-month period covered by the review. CBB officials pointed out, however, that the report was based on just a small sample of NCBA expenses, and they expected further review would uncover more misallocated funds.

At that meeting and since, NCBA officers and staff have maintained the organization would not intentionally violate the “firewall” separating checkoff and policy spending, and that they would correct any accounting mistakes.

Almost six months later, NCBA has reached an agreement with CBB to do just that — correct the mistakes by crediting misallocated funds back tothe checkoff. Further review did indeed uncover misallocated expenses beyond the original $37,000. In early January, NCBA and CBB officials sent a joint letter to Dr. Craig Morris, deputy administrator of USDA’s Agricultural Marketing Service, which oversees the Beef Checkoff, outlining the two organizations’ agreement to resolve the discrepancies, with NCBA repaying just under $217,000 to CBB.

The letter states that the accounting issues have been resolved in accordance with an agreement the two groups proposed, and USDA/AMS approved, in September 2010. It also notes that CBB has expanded its review process, adding monthly reviews of contractor invoices and has sent contractors new USDA/AMS-approved guidelines to prevent future mistakes. The CBB executive committee states it is satisfied with the final resolution and confident in the expanded review process.

So while NCBA and CBB have declined to issue comments on the agreement, it appears both groups are happy. USDA/AMS apparently is happy. Many producers probably are happy to see the issue resolved and the groups getting back to the business of building beef demand.

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