Operating Committee Recommends ’08 Budget

At the end of a long week of detailed meetings, the Operating Committee today recommended a $48.87 million Cattlemen’s Beef Board budget for fiscal 2008, which begins Oct. 1, 2007. The budget reflects a sharp 9 percent decrease from the $53.28 million budget for fiscal 2007, and the week’s discussions certainly reflected the difficulty that decrease brought to the table.

The budget for the Beef Board next year includes projected revenue of $45.7 million, plus money to be available from program budgets costing less than originally estimated in the current fiscal year. Because checkoff contractors improved their expense estimations so much in 2007, it has reduced the amount available to add to the budget in 2008.

Cattlemen’s Beef Board Chief Operating Officer Tom Ramey said that while getting better at estimating costs is definitely a good thing, it does amount to a hard hit on the budget for next year because there was such minimal over-budgeting for individual programs this year.

The breakdown of the budget recommendation from the Operating Committee — which still must be approved by the full Beef Board and USDA before any funds are expended — includes the following budget elements: promotion ($22.7 million); research ($7.4 million); consumer information ($6.2 million); industry information ($2.4 million); foreign marketing ($5.15 million); producer communications ($2.27 million); evaluation ($240,000); program development ($125,000); USDA oversight ($210,000); and administration ($2 million).

“We faced a substantial challenge in determining where to decrease expenditures to meet the smaller budget in the coming year,” said Ken Stielow, a producer from Kansas and chairman of the Cattlemen’s Beef Board. “Many of us arrived in town early to spend the week with state beef council executives and leaders of the checkoff’s joint program committees, as they developed strategies for investing the limited checkoff dollars in the most efficient manner possible in fiscal 2008. The producer members of the Joint Budget Committee and the Beef Board Executive Committee also weighed in on the week’s discussions to help make the tough decisions.”

In the coming stages of the fiscal 2008 budgeting process, the full Beef Board will be asked to approve the budget at its meeting in Denver in July. Joint industry advisory committees and subcommittees also will meet in Denver to prepare recommendations for specific program proposals that are funded with that budget. Those proposals will be considered by the Operating Committee in September, before the Oct. 1 beginning of the fiscal year, and must finally be approved by USDA before any checkoff dollars may be spent.

Planning for FY 2008 Checkoff Programs

It’s midweek in a busy week of checkoff planning meetings that have drawn producers and state beef council representatives from across the country to begin developing plans for checkoff investments in Fiscal 2008. These meetings also mark the midpoint in the year-long checkoff planning process.

This week began with a two-day gathering of state beef council execs and beef producer leaders from the Cattlemen’s Beef Board and the Federation of State Beef Councils, who worked with checkoff program managers from the National Cattlemen’s Beef Association, the U.S. Meat Export Federation, the American National CattleWomen, the National Livestock Producers Association, and the American Veal Association to map out strategies for promotion, information, and research projects aimed at increasing consumer demand for beef.

Participants offered input and suggestions for strategies including product, nutrition, industry resource, veal, foreign marketing and safety strategies for programs in promotion, research, foreign marketing, consumer and industry information, and producer communications. The goal was to agree upon a direction for checkoff programs that focuses on meeting the goals of the Industry Long Range Plan and the demands and preferences of today’s consumers. The basis for the strategies is market research that maps out those consumer preferences in the current marketplace so that limited checkoff dollars can be targeted as effectively as possible.

The next step in the process is under way today, as producers who volunteer to serve as chairmen and vice chairmen of Joint Checkoff Committees (Cattlemen’s Beef Board and Federation of State Beef Councils) are presented with the work of the first two days of the week and offer their input as they look toward directing development of specific checkoff programs for the fiscal year that will begin Oct. 1, 2007. Upon their review and input sessions throughout the day, the producer chairmen and vice chairmen of the committee groups — Global Consumer Marketing, Research and Knowledge Management, Public Opinion and Issues Management, and Industry and Producer Services — will go through the same process this evening.

On Thursday morning, the producers who serve on the Joint Industry Budget Committee will take a look at the strategies and analyze the estimated dollar amounts required to bring those strategies to life and come up with a budget recommendation to forward to the Beef Promotion Operating Committee. The Operating Committee, which eventually makes the final program recommendations and is made up of 10 producer members of the Beef Board and 10 producers from state beef councils, will meet on Thursday afternoon to offer its input about the strategies and to review the budget recommendation. The Operating Committee will then provide contracting organizations and potential checkoff contractors with direction for developing specific programs to present to Joint Checkoff Committees during the Cattle Industry Summer Conference in Denver July 17-20.

Among participants, there is no doubt that this is a thorough process. In fact, one producer said on Tuesday that he previously had little understanding about how in-depth the checkoff planning process was and that learning about it and having direct input into it this week has increased his confidence in the validity of the program proposals that come before committees during the summer.

In addition to the planning meetings, the Cattlemen’s Beef Board Executive Committee has its spring meeting scheduled for Friday morning (May 18), also here in Denver. Members of that committee also are listening in on planning meetings and will receive a report from the Operating Committee regarding such. It also will review a proposal from the Beef Board and Federation of State Beef Councils to bring all producer communication programming regarding the checkoff under management of the Beef Board beginning in Fiscal 2008.