The United States Department of Agriculture on June 9 published revisions to the controversial Hardwood Lumber and Hardwood Plywood Promotion, Research and Information Order, commonly known as the Hardwood Checkoff.
The Hardwood Checkoff, if implemented, would charge sawmills and kiln operators an assessment per $1,000 in sales. The amount assessed is based on the product sold and would go toward an industry-wide promotional campaign for American hardwoods, much like the checkoff-funded “Got Milk?” and “Pork: the Other White Meat” campaigns.
The revisions vary in complexity. One change was made to ensure everyone understands that “KD” means kiln dried. Another revision was meant to clarify that a lumber manufacturer must pay the assessment if the company has annual sales of “$2 million or more,” versus the original wording “more than $2 million.”
The full list of revisions can be viewed on the Federal Register website.
The revisions come after more than 900 comments were made over the course of two comment periods.
The USDA has reopened comments so the public can discuss the new revisions. The comment period closes Aug. 10.
If the Hardwood Checkoff were implemented, lumber companies with annual sales of $2 million or more would pay $1 per $1,000 in sales on raw product. Unfinished strip flooring, moldings, dimensional components, etc., would have a reduced rate of $0.75 per $1,000 in sales. Hardwood plywood mills with sales over $10 million would pay a rate of $3 per $1,000 square feet of production.
The agency will accept comments on any part of the Hardwood Checkoff, but is specifically looking for answers to these questions:
1. Hardwood Plywood: Several comments questioned the inclusion of hardwood plywood in the proposed program. Commenters opined that hardwood plywood competes with hardwood lumber, and that plywood is too different to include in the program. As USDA continues to evaluate the merits of including hardwood plywood in the proposed program, USDA seeks comments on the following questions:
a. What are the benefits and the drawbacks for including hardwood lumber and hardwood plywood together in the same research and promotion program?
b. How would the proposed program benefit the hardwood plywood sector of the industry?
c. What types of promotion programs could be envisioned by the industry for hardwood plywood and how would this impact the hardwood lumber sector of the industry?
d. What impact would excluding hardwood plywood have on the expected amount of assessments to be collected under the proposed program?
e. What impact would excluding hardwood plywood have on the proposed Board structure?
2. Assessments: As previously mentioned, several comments were received regarding the proposed assessment section. USDA has clarified the section in this supplemental proposed rule, but also seeks comments on the following questions:
a. Should the assessment computation be revised? If so, how should it be revised and what would be the impact on the projected amount of assessments to be collected under the proposed program?
b. Should the proposed rates of assessment on any of the four types of covered hardwood be revised? If so, to what level and what would be the impact on the projected amount of assessments to be collected under the proposed program?
