USDA shelves rulemaking for organic program

The Agricultural Marketing Service of the U.S. Department of Agriculture May 11 ended the rulemaking proceedings proposing the establishment of a national research and promotion program for certified organic products under authority of the Commodity Promotion, Research and Information Act.

The program, as proposed by the Organic Trade Association, faced opposition within the Trump administration. According to a statement in the Federal Register, the rulemaking process was killed because it suffered from “uncertain industry support for and outstanding substantive issues with the proposed program”.

On May 15, 2015, USDA received a proposal for a national research and promotion program for certified organic products from OTA, a membership-based trade organization representing growers, processors, certifiers, farmers associations, distributors, importers, exporters, consultants, retailers and others involved in the organic sector.

OTA proposed a program that would be financed by an assessment on certified organic products and administered by a board of industry members selected by the Secretary of Agriculture.

The purpose of the program was to strengthen the position of certified organic products in the marketplace, support research to benefit the organic industry and improve access to information and data across the organic sector.

A proposed rule consisting of OTA’s proposal was published in the Federal Register on Jan. 18, 2017, that provided a 60-day comment period that ended on March 20, 2017.

On Feb. 27, 2017, a document was published in the Federal Register that extended the comment period until April 19, 2017. The proposed rule included a request for comments on substantive aspects of the proposed program, including the support for, and method of, assessing imports; the approach for calculating assessments including how “dual-covered commodities” would be handled; and the de minimis exemption level.

“In response to the proposed rule, USDA received almost 15,000 comments. The comments revealed that there is a split within the industry in terms of support for the proposed program. While some comments voiced support for a collective industry program, other comments stated that industry was not aligned in backing the proposal,” the USDA-AMS order said.

“Opponents raised concerns about the proposed program, including how the de minimis level would eliminate a majority of organic farmers from the program; the disproportionate impact on high value commodities as assessments would be tied to sales value; whether organic promotion is possible without being disparaging to other agricultural commodities; voting methodology; financial burden on small entities to comply; and cited the challenges to tracing imported organic products. Both those in support of, and those in opposition to the proposed program requested changes to the method of assessment for imports and a reduction in the paperwork burden on covered entities.

Other outstanding significant issues with the proposal are the assessment of non-food products and products “made with (specified ingredients)”.

Research and promotion programs are brought about by collective and united industry action. The comments received on the proposed organic program disclosed divergent views within the organic industry.

Based on uncertain industry support for and unresolved issues with the proposed program, USDA is terminating the proceeding. This action also terminates the rulemaking procedure on the proposed referendum procedures.

For its part, OTA said in a statement the action to kill the proposed organic program “reflects a pattern of holding back forward progress on organic by USDA. The $50 billion organic sector offers opportunities for U.S. organic farmers and businesses. It makes no sense that the agency is continuing to take steps to cut it off at the knees. We encourage USDA to lean closer to the consumer and support choice, transparency and opportunity.”

Laura Batcha, OTA executive director and CEO, said, “If there was ever a need for an organic checkoff, it is now. We are seeing organic dairy and egg sales flattening because of USDA’s failure to move the animal welfare rule forward. Organic research funding is uncertain because it is tied to the unpredictable fate of the farm bill. The government also has interfered with the strong role of the National Organic Standards Board. These actions hurt U.S. organic farmers and businesses.

“This announcement comes within days of a smiley face GMO disclosure logo, which is bound to cause confusion for consumers and reveals that USDA is not being even-handed. There is no question we need promotion for organic as consumers continue to demand food transparency.”

OTA called USDA’s assertion on uncertain industry support for the proposed program “simply wrong.” Submitted comments by public endorsers totaled 1,358, including over 1,230 certified organic operators.

“These organic farmers, ranchers and business stakeholders were joined by over 11,000 supporters who commented directly on the proposal,” the OTA statement said.

“The organic checkoff proposal was crafted over five years, incorporating the input from organic stakeholders throughout the country. The proposal also included constructive ideas brought forward during the opportunity to submit partial proposals. It did not include ideas not allowed under USDA’s regulations governing checkoffs, or ideas that reflected a misunderstanding of this unique proposal. The proposal was comprehensive, thoroughly vetted, and strong.”

OTA said in its statement it was gratified to see the Organic Research and Promotion Order on the Trump administration’s Unified Agenda this past summer and took it as a positive sign the administration sees value in the organic industry investing in itself.

“What changed,” the OTA statement asked. “We expected to see the process progress with the publication of a final proposal from USDA, followed by a vote on the proposed program by the organic sector. It is unfathomable that organic stakeholders will not be given the chance to cast their vote, and to decide for themselves if they want to implement an organic check-off. USDA unilaterally making the decision on behalf of the 26,000-plus certified organic growers, ranchers, processors, handlers and business owners to not advance the process is stunning.”

Over 20 agricultural products have similar research and promotion orders, which allow pooling of private sector dollars to supply industry wide research and consumer education programs, according to the OTA statement.

“There is broad agreement in the diverse organic sector on the need for more research, more technical assistance and more education on organic. The proposed checkoff is a viable path forward to fill this need, and would enable the organic industry to have the same opportunity as other industry groups,” the statement said.

“The Organic Trade Association will fully assess opportunities through the private sector to advance innovative solutions that will have important and long-lasting benefits for organic farmers, businesses and consumers alike, as we face the reality, once again, that government is not willing to keep pace.”

Larry Dreiling can be reached at 785-628-1117 or [email protected].