Courts’ Findings That Checkoff Activities and Speech Are Those of the Federal Government


There is a strong misconception among policymakers that the commodity research and promotion programs (checkoffs) are producer dollars and that the producers should decide how those funds should be spent, as if $750,000,000 per year of tax dollars should be exempt from regular taxpayer safeguards. Many policymakers have adopted an “out of sight, out of mind” attitude toward checkoff funds. However, the U.S. Supreme Court has made clear that checkoff activities and speech are those of the federal government.

The USDA Secretary of Agriculture’s role is often referred to by opinion leaders as one of “oversight,” but more accurately the decisions of two U.S. Supreme Court cases establish with constitutional precision that the Secretary’s role is at the checkoff helm. Federal checkoff programs are government programs without any authority independent of the Secretary of Agriculture. In order for these programs to operate lawfully, the Secretary must fully control, and be accountable for, all programmatic activities and expenditures.

At the beginning of the last decade, there were a number of legal challenges from producers about mandatory checkoff funds. In 2001, the Supreme Court agreed with producers and declared that the mushroom checkoff was an unconstitutional program of compelled subsidization of private speech (United States v. United Foods, Inc., 533 U.S. 405 [2001]). The Court found that checkoffs—in this instance, the mushroom checkoff was before the Court—were not true “marketing” schemes involving regulatory restrictions on commodity prices and supplies, but rather programs where viewpoint-based speech in the form of generic advertising (i.e. promotion) was the primary purpose, and as such producers could not be compelled to subsidize the programs (Id. At 412-13). The Court specifically noted that the government defendants had failed to timely raise an argument that checkoff programs might otherwise survive scrutiny under the First Amendment if strictly operated as programs of government speech (Id. at 316-17).

Following the United Foods decision, checkoff boards operated with an uncertain future for several years. But in subsequent lawsuit decided in 2005, the government argued that its level of control over, and accountability for, the beef checkoff program’s operations and messaging—down to every word of every promotion—made it a program of government speech that survived First Amendment scrutiny (Johanns v. Livestock Mktg. Ass’n, 544 U.S. 550, 562 [2005]). The Court agreed, but only because of that level of government control and accountability over the program.

In another recent Supreme Court argument, the Chief Justice sharply questioned the government on this issue:

CHIEF JUSTICE ROBERTS: And by the way, it better be the Department of Agriculture that takes these – you said earlier it’s the Raisin Committee – or else you’re going to have a lot of trouble in your government speech cases, where you always make the point that these committees are, in fact, the government.
KNEEDLER: We’re not – we’re not saying the committee is not the government. What I was saying is that the – that the operation of the program is not for the government’s benefit. It is for the producers’ benefit.
(Horne, et al., Petitioner, v. U.S. Department of Agriculture, 2015 WL 1816698 (U.S.), 34-35 [U.S.Oral.Arg.2015])

Some suggest that there are some messaging and spending decisions that should be left to the various checkoff boards and the trade organizations that receive the checkoff tax dollars. This is problematically wrong, and the consequences would be disastrous for individual producers, especially small family farmers who are compelled to pay assessments into a program to fund advertising that could be controlled by their market competitors—e.g. trade groups that represent a segment of the industry—rather than under the exclusive control of the government.

Checkoff programs accumulate an extraordinary amount of money from producers collectively, and thus generate massive industry messaging power—far greater than any one or a few producers can generate—which can be used for good or harm depending on whether the government accepts its role as owner and operator of messaging and spending. If they are to exist, it can only be on the condition that the government has ultimate control over, and is accountable for, every word of every promotion and every dollar that funds it. If the government’s position cannot be that checkoff boards have authority to make independent decisions about messaging, ongoing campaigns, or spending, then it perjured itself in the cases cited above and farmers should still have the right to freedom of speech and not be forced to pay into these government mandated funds. Whatever the wording of an individual regulation, it is clear that either the government must take ownership or control of these programs through meaningful legislative reforms or it should simply repeal the checkoff programs and allow the various commodity trade organizations to develop their own market programs for their membership.

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