The initial phone contact was made by Chris Leslie, inquiring about the 2006 checkoff overage , which is when the information regarding the 2007 changes was first discovered.

Dwayne : With this fax there was also a copy of the Manitoba Agricultural Producers Funding Act, Click Here to view. Take special Note of Section 4 which discusses the fees. It reads "of all sales of sunflowers in Manitoba" while the NSAC website on the homepage still shows on Dec 18th 2007 the following phrase

NSAC would like to receive the checkoff on everything grown in Manitoba, while their legal authority only covers sales made in Manitoba, not any sales made in other parts of Canada or the United States

I was just recently made aware of the changes to the National Sunflower Association of Canada commodity checkoff.

I completely understand the difficult issue of funding for associations, and the the checkoff program is widely used by associations to easily access funding .

Shifting the costs and enforcement of the program to buyers and processors is an easy way out, and indifference by the majority of farmers to taking an active role in holding the associations accountable for their funds is a win for most groups.

But there is one circumstance that has arisen that would seem to force farmers to excessively fund the NSAC in the future with the changes to the Agricultural Producers Organization Funding Act that came into effect Oct 1 2007.

The doubling of the checkoff fee from 1/4% to 1/2% will quickly increase the revenue that the association will receive and with the removal of any maximum limit it will also dramatically increase the total revenue that the association will receive.

While I understand that the checkoff is fully refundable , there is the technicality as I understand that if you even request a partial refund of your checkoff funds to be returned, you will not be in "good standing" with the association.

Therefore, a producer will not be eligible for the Cash Advance Program because they are not in good standing with the NSAC.

I really must question these changes, as it means that using the Interest Free cash advance program will now cost me nearly $3,000.

If this is true, I will certainly not be saving any money with this program, so obviously many producers will opt out and likely request their entire checkoff to be returned as well. This will not help the association continue to do the political work and research that needs to be done.

While reading the act that was furnished to me by Darcelle Mabon from the association office, I can see no definition in the wording where a member of good standing is explained, or how a partial refund would work. This "good standing " designation seems to be in a very gray area from a legal standpoint.

Most importantly, I see no reason why if a producer requests all but 250.00$ of his checkoff to be refunded is not in good standing, while a farmer who leaves his entire checkoff of 100.00$ with the association to be considered to be in good standing?

This is a situation that every grower I have spoken to in the past few days was unaware of, so I would expect there to be a timely and detailed explanation of this to the growers.

I look forward to hearing back from the association on this issue within the week.

I don't want to get the media involved, but timeliness is important as this appears to be a potentially a very costly situation for many farmers that should be dealt with and clarified before they deliver their first loads from the 2007 harvest.

Respectfully Yours.

Dwayne Leslie

Commodity Organisations should automatically send a complete reconciliation with any refund so that accuracy can be assured.

With this fax was also the Bylaws of NSAC and a Checkoff Refund Form

Thank you for the timely followup to my concerns, but I think you can understand why the tendered response will not make me very happy. I have attached your original reply in PDF so that all interested parties will be able to understand my response.

As for apparently getting a cash advance in 2006 without being a member, that would be a question you will have to ask of the people whom you have hired to administer the program on your behalf. As I mentioned it was the first time I had ever used the Cash Advance program and it is obviously not up to me to know all the technicalities. It would also appear that it will be the last time I will be able to use the program as the costs now will obviously out weigh any potential benefits.

That I apparently wasn't a member in 2006 may also explain why I have received zero information in the past year regarding the changes that were implemented as of October 1st.

I did attend the 2007 NSAC summer seminar in Carman, and I don't recall anyone standing up and saying that the checkoff would be going up exponentially beginning Oct 1st. This would have been timely as by my recollection of the date in Carman the NSAC would have just received confirmation that they were allowed to make the requested changes.

I appreciate receiving a copy of the bylaws of the NSAC. It makes for very interesting reading but it does bring up a few questions. I don't see a definition of what a member in good standing actually is ? How someone who requests a partial refund would be not considered a member in good standing, even though they may have perhaps chosen to leave a 1,000$ with the association? There would seem to be many things stated by the NSAC in the recent correspondence that is not backed up by any legal documents that I have been provided with.

I would expect that if I pay my cash advance back immediately that I will be able to receive a refund of all my future 2007 production checkoff fees and my excess 2006 crop checkoff fees  on the basis that all these cash advance agreements were done long before the new NSAC checkoff rules came into effect on October 1st 2007

I truly feel sorry for any producers who must use the cash advance program because of a short term harvest cash crunch. They receive interest free savings for only a few months and may actually pay back that amount and much more over the year as they are forced to pay excessive amounts of checkoff.

Bottom line is I am very disappointed in the way this has been handled by the NSAC. It took 3 times as I recall to convince enough producers to allow the limited checkoff to proceed as it was. I sincerely doubt  the producers would have agreed if they knew at the time that it would soon change to 1/2% of their entire sunflower crop. The fact that it is unlimited should be very concerning to every sunflower producer in Manitoba.

Any changes to checkoff fees should be put to a provincial vote under the same program as the checkoff was initially voted in. All sunflower producers who have a stake in the industry should have a say, rather than the relative few who attend the new poorly timed AGM in February in Winnipeg.

I look forward to hearing more from the Elected Executive Committee on this issue before I decide what my future options are.

Regards

Dwayne Leslie

   In the course of the conversation he informed me that there wasn't much they could do because changing the definition of a member in good standing would require changes to provincial legislation, which would be unlikely to be forthcoming.

Because I had a Cash Advance, I was not eligible for a refund.

This led me to contact Randy Ozunko, who is with Manitoba Agriculture and is in the department tasked with handling the commodity checkoffs. What he told me was very informative, and led me to question the information supplied by NSAC.

Subject: NSAC checkoff
11/27/2007 4:31 PM

Hello again Blair, I appreciate your being candid with me during our chat on Monday.

From speaking to an official at Manitoba Agriculture several times regarding the Ag Producers Funding Act, I understand there are a few things that NSAC has not been forthcoming with to the producers and processors.

1) There is no legal authority to collect checkoffs on sales of sunflowers outside of Manitoba. They "encourage" buyers outside the province to deduct checkoffs, but there is no way to enforce it.  Especially when under Section 4 of the APOFA it states "of all sales of sunflowers in Manitoba" .

2) I also understand that if 30% of the members ask for a refund or 30% of the total checkoff dollars are asked to be refunded, the province is automatically obligated to hold a referendum similar to the initial 3 votes that the NSAC had to gain the initial checkoff amount.

3) The provincial legislation has nothing to do with the definition of what a member in "good standing " is. This definition is set entirely by the bylaws of NSAC.  A simple amendment to allow producers to ask for any excess amount over a set minimum fee while allowing them to continue being a member in good standing will quickly rectify my concerns and allow the association to continue working for the good of the industry.

Upon learning these items, I have not gone public with my intended press release. I would like to hear back what the NSAC position is on this new information.

If there is no interest in having my concerns dealt with, there is no option left to me other than to call on all Sunflower producers to ask for a checkoff refund. Since every sunflower producer I have spoken with in the past month had no idea that their checkoff amount had gone up exponentially, I wouldn't see it being a problem to achieve the 30% requirement in either category.

As a reminder, I am not against the association or the work that you are doing. I just disagree with being forced to fund any organisation against my wishes, whether I agree with their policies or not.

I look forward to hearing back from you this week as I have a tentative meeting with Federal Ag Minister Ritz late Friday when he is in Portage la Prairie.

Dwayne Leslie

Hello again Blair and Blair

I received the reply to my past questions from Darcelle last week, and it certainly addresses one point, but completely ignores my other concern.

I appreciate the clarification regarding the responsibilities of processors outside Manitoba. As this is very different from the original letter that Darcelle sent out on behalf of NSAC on August 20th 2007 to processors demanding their compliance, I would presume that NSAC has sent out a followup letter to all parties updating the information to point out that they are encouraged to make the checkoff deductions but are under no obligation to do so.

On a second point, I appreciate having the definition of a member of good standing highlighted once again for me, and also reminding me that the checkoff is fully refundable.

This does not answer my concern on behalf of all sunflower producers in Manitoba that their checkoff is NOT refundable if they have a Federal cash advance.

Seeing as I do have a Federal Cash advance, it appears if I sell any product to a buyer/processor in Manitoba, I have no choice but to but to pay nearly 3,000$ in checkoff which will NOT be refundable. This works out to a 12% effective interest rate for the 3 months I will have had my advance. I am sure that this was not the intent of the "Interest Free" Federal program

On behalf of all Sunflower producers who had a cash advance before Oct 1st 2007 when the new NSAC regulations came into effect,  I would like to know if they will be able to request their checkoff dollars back in full if they so choose or at least the overage of the original 250$ membership fee which was the rule in effect at the time producers took out their cash advance?

Or will their be any simple bylaw changes made to allow for partial checkoff requests to be made? I am sure many producers would like to continue funding the work of NSAC, myself included, but given the choice of giving thousands of dollars or nothing, sadly many producers will give nothing.

NSAC's refusal to give reasoning why they appear unwilling to make these simple administrative changes is very difficult to understand. If this organisation is truly run by producers on behalf of producers, perhaps the producers are owed some answers. Since these changes were apparently approved by barely a dozen members at the 2007 AGM, perhaps it's time to answer to the hundreds of other growers now being forced into these new rules.

One farmer I spoke to earlier in the week simply said that he will deal exclusively in the US, he was so angry at the actions and attitude of NSAC when I explained what they had done. This certainly doesn't help the buyers and processors in Manitoba, NSAC, or the Canadian sunflower industry in general.

Publically calling on 30% of producers to force this to a provincial referendum is easy, but is it worth tarnishing the whole industry in the long run. It appears that is now upto NSAC to decide.

I would certainly hope that NSAC has the ability to see there way clear to do what's good for all sunflower producers in Manitoba.

If I haven't heard back in the next few days, we will be going live with www.sunflowercheckoff.com on Wednesday Dec 19 2007.

Dwayne Leslie

NSAC still insist on using rules that came into effect on October 1st for Cash advances taken out weeks and months before that.

NSAC also still insist  that the checkoff is refundable, even though it isn't if you have a cash advance.

NSAC has also wasted the past 2 months disregarding the simple issue of defining what a member in good standing actually means. Now that they are at the 90 day deadline for changes to be brought forward at their AGM , they can now get another year to hope this issue goes away.

If you are as disappointed in the way NSAC has handled this whole debacle as I am, I ask you to do one thing.

Pick up the phone right now and call NSAC at    204.745.6776  to request a refund of your sunflower checkoff. Don't wait until the deadline to ask, do it today so that you don't forget .  The quicker that NSAC realises that the 30% threshold has been reached for refunds, the quicker they will realise that they may lose the ability to receive any checkoff dollars if they don't begin to listen to producers.. 

Once 30% of the members ask for a refund, or 30% of the total checkoff revenue is asked to be refunded, the Manitoba Government is obligated to hold a province wide referendum on the sunflower checkoff. This will allow ALL sunflower producers to be heard , regardless of how far they are from the AGM in Winnipeg.

Even if you have yet to deliver a pound of sunflowers call now to make your voice heard.

If you grew sunflowers in 2006 you are still a member, so call now to make your voice heard.

If you have a cash advance on your sunflowers, be sure to call and request a checkoff refund so that your name can be added to the list of members who are unhappy with the new policies of NSAC. 

At the same time, give me a call or drop me an email so that we can continue to provide you with more information as this issue moves forward. 

Dwayne Leslie
204-267-2722
Poplar Point MB
sunflower@farmauctionguide.com
 
 

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