Last week, the Senate Agriculture Committee in the Iowa Legislature passed SF310, a bill relating to the Iowa Corn Promotion Board structure and the state corn checkoff. The bill was originally introduced as a study bill in January. Since it has now advanced out of committee and has survived the first "funnel date" in the 2013 legislature, the bill is still alive and will move forward for more debate.
The ICPB oversees the corn checkoff in Iowa, and makes decisions on how the checkoff money collected is spent on corn research, promotion and market development projects and programs. The ICPB and the Iowa corn checkoff are governed by state law.
This bill proposes reducing the size of the Iowa Corn Promotion Board
State law currently allows for two Iowa Corn Promotion Board directors per crop reporting district and there are nine crop reporting districts in Iowa. The new bill, SF310, if passed by the legislature would maintain the current election process of farmers electing farmers to serve on the ICPB and represent their district. However, the law would change to one director from each crop reporting district and three executive committee members to create a 12 person board.
In addition to 12 voting members, four ex-officio members would continue to serve on the ICPB. Those four people would be a representative of the Iowa Department of Agriculture & Land Stewardship, the dean of the College of Agriculture at Iowa State University, and two corn purchasing representatives who are currently collecting the checkoff when corn is sold by farmers in Iowa. The Iowa Economic Development Authority, a former ex-officio, is agreeable to participating at the Iowa Corn committee level, instead of having a seat on the Iowa Corn Promotion Board.
Board structure changes proposed -- keep in mind that ICPB differs from ICGA
There is another proposed change to note. That is, while not a part of Senate File 310, the Iowa Corn Growers Association board of directors would also be a 12 person board. In addition to 12 voting members, two ex-officio members would continue to serve on the ICGA Board. These two would be a representative of the Iowa Soybean Association and a representative of Iowa Farm Bureau. ICGA is not required to make board structure changes through Iowa statute, as it is a nonprofit organization, whereas the ICPB was created by Iowa law in 1977. The ICGA does not make spending decisions regarding the checkoff money; ICGA is a membership organization and has its own board of directors, separate from ICPB.~~~PAGE_BREAK_HERE~~~
Why are these changes being proposed? As a grassroots organization, the revised board structure for ICPB will provide greater involvement of farmers at the local level, naturally increasing grassroots participation through existing county corn organizations, expanding new county organizations, and creating regional corn groups, according to Kevin Rempp, chairman of the ICPB who farms near Montezuma, Iowa. In addition, there will be more grassroots involvement in Iowa Corn's committees to allow even more corn grower involvement in activities of both the ICPB and ICGA.
What would these changes in ICPB structure mean for Iowa corn checkoff?
Would this change in the ICPB structure affect the corn checkoff rate per bushel that is collected when corn is sold by farmers in Iowa? Senate File 310 does not raise the checkoff rate, notes Rempp. By law, for the checkoff rate to be raised, farmers would have to vote on it and approve it through a statewide referendum. Any decision regarding the checkoff rate would continue to be in the hands of Iowa corn farmers via referendum just as it was created by farmers in 1977.
The bill does, however, seek to increase a 1-cent-per-bushel maximum and permit a 5- cent-per-bushel cap. In other words, the corn checkoff rate in Iowa is currently 1 cent per bushel, the maximum allowed by law. The bill seeks to raise that cap, but would not increase the amount currently being checked off. A referendum would have to be held and any rate increase that is proposed would have to be approved by farmers before it could go into effect.
"There is no intent to raise the corn checkoff any time soon," says Rempp. Over the course of 36 years the corn checkoff has risen from one-tenth of 1 cent per bushel to today's 1 cent per bushel, he adds.
What is the process that must be followed if corn checkoff is to be increased?
When farmers desire to raise the checkoff in the future, the following process, which is the current practice, must be followed. Mindy Larsen Poldberg, director of government relations for Iowa Corn, provides this explanation.~~~PAGE_BREAK_HERE~~~
First, the farmers elected to the Iowa Corn Promotion Board must vote and pass a recommendation to hold a farmer referendum to raise the checkoff; Second, through IDALS, the Iowa Secretary of Agriculture will administer the referendum vote on the proposed assessment increase; Third, the referendum must pass a vote of corn farmers, (defined as anyone who sells more than 250 bushels of corn) to be voted on either in person at the county office or by absentee ballot administered by IDALS. Finally, the Iowa corn checkoff will continue to maintain its refund provision, as has been available since 1977. In other words, if a corn producer does not want to participate in the checkoff, the producer can file the proper paperwork and get a refund.
Why does the cap on the Iowa corn checkoff rate need to be raised?
"We need corn farmers to support the Iowa corn checkoff," says Bruce Rohwer, president of the ICGA and a farmer from Paullina in northwest Iowa. "If the cap is not raised from 1 cent per bushel, the legislature will maintain the authority over the corn checkoff rate. If the cap is not raised, only the government could decide the appropriate time to allow for a referendum in the future, instead of farmers."
By raising the cap in SF310, Iowa corn farmers will maintain the right to protect their checkoff by having their farmer-elected leaders select the appropriate checkoff rate, he says. Iowa Corn believes that corn farmers should maintain control of the Iowa corn checkoff to best meet the education, research, and market development needs of all Iowa corn farmers, especially as emerging issues arise in the future.
The bill has passed the Senate Agriculture Committee and the House Agriculture Subcommittee in the Iowa Legislature and ICGA supports the bill.