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Hardwood Checkoff Sponsors Call for Limiting Scope Of the Program, Excluding Industrial Grade Markets
After a number or large sawmills and industrial grade users have voiced their opposition against the proposed hardwood checkoff for trade promotion and research, the BRC announced its willingness to make some concessions to help ensure passage of the proposal.

By Chaille Brindley
Date Posted: 3/3/2014

                It appears that pallets, crossties and other industrial grade markets would be exempt if the proposed hardwood checkoff is adopted by the hardwood industry. The Blue Ribbon Coalition (BRC) behind the initiative has called for some sweeping, and the U.S. Department of Agriculture (USDA) is likely to follow the BRC recommendations if it decides to even put up the hardwood checkoff for an industry vote at all.

                After a number or large sawmills and industrial grade users have voiced their opposition against the proposed hardwood checkoff for trade promotion and research, the BRC announced its willingness to make some concessions to help ensure passage of the proposal.

                 The BRC in its recent comments have called for a number of major changes to impact the scope of the program, including the sectors of the industry covered by checkoff fees as well as the paperwork burden related to compliance.

                The BRC, which includes top leaders from some of the largest hardwood mills in the country, stated, “We have noted a need for the following amendments which would not materially change the direction of the program if finalized and will reduce rather than expand those eligible for the program: including export sales, adding yellow poplar, removing all industrial lumber and lumber products from eligibility, and clarifying and simplifying the exemption process for small businesses.”

                Regarding low-grade sectors, the BRC commented, “The committee continues to believe that all sectors of the hardwood industry will benefit from a checkoff program. However after carefully listening to commenters and other input the committee suggests at this time in order to lessen the burden on green sawmills, the checkoff is best focused on non-industrial grade lumber, a limited number of value-added products, and hardwood plywood.”

                The BRC is calling for the assessment to only cover “hardwood lumber that has been transformed from timber or green lumber into products that remain boards meeting or exceeding the level of ‘Grade 3A Common’ as defined by National Hardwood Lumber Association grading rules.” The new language specifically exempts industrial products which remain in board or block form such as ties, cants, crane mat material, barrel staves, and pallet stock or products transformed from boards or blocks of lumber into other products, such as furniture, cabinetry, and constructed pallets.

                Some of the changes are attempts to fix mistakes in the draft language. The BRC explained, “Upon publication of the proposed order we immediately noted the mistaken wording in the explanatory language of the proposal describing “export sales” as an exclusion under the checkoff. This has never been the intent of our effort… Our intention from the outset was to include domestic as well as export sales under the checkoff assessments.”

                Also, the draft language did not include poplar among the species to be covered.

                The BRC proposal also covers concerns raised by small businesses about the burden of compliance. The BRC suggested, “Rather than a system that requires small manufacturers to opt out of the assessment, they should only have a paperwork obligation when they must opt in…Until then, there is no paperwork requirement, except for the initial filing that establishes the exemption. This avoids unnecessary paperwork and safeguards against collecting assessments from exempt manufacturers that simply forgot to file a yearly renewal.”

                The USDA must now take all the comments under advisement and must decide if it will go ahead with the checkoff and what should be changed in the final order to be approved by the industry. If the USDA moves ahead with the checkoff, it must first put the final proposal up for a vote of the companies that would be required to pay into the program. Any final vote would likely be held sometime this year.








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