Christmas Tree Promotion, Research, and Information Order

The Christmas Tree Promotion, Research, and Information Order is a provision of the 2014 U.S. Farm Bill that established a U.S. Department of Agriculture commodity checkoff program for cultivated Christmas trees. The program is funded through a $.15 per tree fee paid by growers. The program creates a marketing program similar to other checkoff programs such as "Got Milk?" or "Beef. It's What's For Dinner". The order was briefly implemented by the U.S. Department of Agriculture's Agricultural Marketing Service in November 2011. After a wave of political criticism the rule that established the program was officially stayed before being passed into law over two years later.

Provisions

The Christmas Tree Promotion, Research, and Information Order is the U.S. Department of Agriculture rule establishing the industry-funded promotion, research and information program in support of fresh-cut Christmas trees.[1][2] The order is what is known in the United States as a commodity checkoff program.[3] It was requested by the Christmas tree growing industry as a result of declining numbers in sales and farms nationwide.[3][4] The program is funded by growers and retailers through a $.15 per tree fee; growers that produce less than 500 trees per year are exempted from the fee.[2][5] The fee was among the program's most publicized provisions.[1]

While it is up to individuals whether to pass the fee on to consumers, the National Christmas Tree Association (NCTA) stated the order is not expected to affect the retail price of fresh-cut Christmas trees.[3][6][7][8] The program allows farmers to allow the government to implement and oversee the program through a Christmas Tree Promotion Board and the funds collected from assessed trees. The board is made up of producers and importers. At the time the rule was proposed, the USDA had implemented more than 20 similar programs including those responsible for the well-known "Got Milk?", "Beef: It's What's for Dinner" and "The Incredible Edible Egg" campaigns.[6]

The levy is expected to generate $2 million per year.[9] The program includes a 12-member Christmas Tree Promotion Board that would directs funding from the program to promotion programs and advertising meant to show "a favorable image of Christmas trees to the public."[1][2] The Christmas tree checkoff program also allows for a referendum among all those who paid the 15 cent per tree assessment after three years.[9] This referendum was designed to allow producers and importers to terminate, continue, or amend the program.[2] The program also specified that if a fee over 20 cents per tree or under 10 cents per tree it would require the approval of the majority of producers and importers.[2]

History

Between 1991 and 2007 natural, fresh-cut Christmas tree production in the U.S. declined from 37 million to 31 million. Meanwhile, the artificial Christmas tree industry saw it sale increase dramatically between 2003 and 2007.[1] In the five years between the 2002 and 2007 U.S. Department of Agriculture (USDA) Censuses of Agriculture, the number of Christmas tree farms in the United States went from 21,904 to 12,255.[6]

Work toward the Christmas Tree Promotion, Research, and Information Order began in April 2008 when a group of farmers and retailers began to study similar programs in agricultural industries of similar size.[10] The group's work included more than 100 meetings across the United States.[10] Initially, the proposed rule was published in the Federal Register in November 2010, one year before the order was first implemented.[11][12] Upon the order's initial publication, the USDA requested input in the form of comments from growers, retailers and the general public.[11][12] The primary commenting period went from the time the proposed rule was first published, November 8, 2010 until February 7, 2011.[11] After the USDA received several letters from producers, a second commenting period was opened from February 22, 2011 until March 9, 2011.[13] During these two comment periods the USDA received 565 comments concerning the proposed rule; 398 supported it, 147 opposed it and the remaining 20 comments fell into some other category.[1]

The order was originally published in the Federal Register on November 8, 2011 and took effect the same day.[2] USDA authority to establish the program came under the Commodity Promotion, Research and Information Act of 1996, a law which also authorized the similar programs in other agricultural industries.[14]

On the same day the new rule was published in the Federal Register David S. Addington, writing for a Heritage Foundation blog, labeled the new rule a "tax" and criticized it in his column.[2][15] Conservative commentators began to attack the proposal, particularly after a link to the Heritage Foundation piece was featured on the highly trafficked website Drudge Report.[4][16] The moniker "Christmas tree tax" was applied in numerous media outlets.[1][4][14][12] The Wall Street Journal criticized the program as "corporate welfare".[17] Despite the criticism the Obama administration and the NCTA denied that the program featured a new Christmas tree tax.[3][16][18] In addition, some media outlets, such as Agence France Presse, immediately characterized the program as a "tax that's not a tax".[8] By the end of the day on November 8, the rule was rescinded, officially it was "stayed".[19] The notice concerning the rule's cancellation was published in the Federal Register on November 17, 2011; the stay took effect that same day.[19]

Capital Press reported in May 2012 that the U.S. Department of Agriculture had not put a timetable on moving the Christmas tree checkoff program forward.[20] The USDA Agricultural Marketing Service did tell the publication that the program was "under review".[20] One of the Christmas tree farmers who spearheaded efforts to establish the Christmas Tree Promotion, Research, and Information Order stated that she did not expect any action on the program until after the 2012 U.S. presidential election.[20] During the summer of 2012 an article posted to USAgNet quoted the director of the NCTA as confirming that there would be no action on the proposal until after the November 2012 election.[21] The July 30 article quoted the NCTA director as stating he had assurances from the current Secretary of Agriculture that the Christmas Tree Promotion, Research, and Information Order would be "released for implementation" before the end of the year.[21] That meant that no funds would be collected under the checkoff program until at least 2013.[21]

The Christmas Tree Promotion, Research, and Information Order was included as originally published in the Agricultural Act of 2014, more commonly known as the Farm Bill, and passed by Congress on January 29, 2014.[5][22] The order's inclusion was pushed for by members of the U.S. House of Representatives including Oregon Democrat Kurt Schrader and Wisconsin Republican Reid Ribble. Ribble helped negotiate with Republican leaders for the order's inclusion, and though at least one version of the order was rejected it was eventually reworked and added to the Farm Bill without resistance.[5] An April 2014 press release announced that the U.S. Department of Agriculture created rules as mandated by the Agricultural Act of 2014 that allowed the Christmas check-off program to move forward.[22] The department actively began seeking nominations for the Christmas Tree Promotion Board at that time.[22] The rule that officially stayed the program in November 2011 was officially rescinded on April 8, 2014.[23]

Reactions

As stated, when the program was initially enacted many in the media characterized the checkoff program as a "Christmas tree tax". After The Heritage Foundation criticized the program as a tax, many other media outlets followed.[1][4][12][16] The Obama administration and the NCTA both denied that checkoff programs were taxes.[18][16] The Cato Institute reacted by calling the program a tax but blamed the GOP Congress in 1996 for passage of Commodity Promotion, Research and Information Act of 1996, the law that authorized such checkoff programs.[24] The Heritage Foundation again reported on what they called "Obama's Christmas tree tax" in June 2013 as Congress amended the Farm Bill to include the Christmas tree checkoff program.[25]

In the aftermath of the "Christmas tree tax" story, other commodity checkoff programs saw their momentum wane. A proposed checkoff program for raspberries, initially expected to be implemented in November 2011, was delayed until the spring of 2012 by the USDA.[20][26] That checkoff program had been approved by 88 percent of "affected" raspberry growers in May 2011.[20] Though a formal proposal had not been submitted for a blackberry checkoff program, the North American Raspberry and Blackberry Association stated that plans for pursuing one had put on hold due to the negative climate surrounding checkoffs.[20]

In 2014, when the rule was finally enacted, the National Christmas Tree Association stated in a press release that they were "pleased".[7] They also noted that the program would be funded by growers and was expected to have no impact on the consumer price of Christmas trees.[7]

References
  1. 'Christmas tree tax to promote the real thing", Chicago Tribune, November 9, 2011, accessed September 26, 2012.
  2. "Christmas Tree Promotion, Research, and Information Order", Federal Register, Col. 76, No. 216, November 8, 2011, accessed September 26, 2012.
  3. "NCTA Position Statement on New Christmas Tree Checkoff Program", (press release), National Christmas Tree Association, November 9, 2011, accessed September 26, 2012.
  4. Tapper, Jake. "Obama Administration to Delay New 15 Cent Christmas Tree Tax", ABC News, November 9, 2011, accessed September 26, 2012.
  5. "Perkowski, Mateusz. Christmas tree checkoff gets greenlight", Capital Press, April 8, 2014, accessed November 18, 2014
  6. Finz, Stacey. "Christmas tree growers fighting for sales", San Francisco Chronicle, November 25, 2011, accessed September 26, 2012.
  7. "NCTA Comments on Checkoff Order Implementation" (pdf), press release, February 10, 2014, accessed November 18, 2014.
  8. "U.S. rethinks 'Christmas tree tax' that's not a tax", Agence France Presse via Google News, November 9, 2012, accessed September 26, 2012.
  9. Perkowski, Matuesz. "USDA approves Christmas tree checkoff", Capital Press, November 7, 2011, accessed September 26, 2012.
  10. "Christmas tree farmers set the record straight", (press release), November 17, 2011, accessed September 26, 2012.
  11. Turner, Jimmie. "USDA Seeks Comments on Establishing New Christmas Tree Promotion, Research, and Information Order", (press release), November 9, 2010, accessed September 26, 2012.
  12. Browning, William. "Christmas Tree Tax Has Roots in 1996 Law", Yahoo! News, November 9, 2011, accessed September 26, 2012.
  13. Fobia, Hakim. "USDA Re-opens Comment Period for Proposed Christmas Tree Promotion, Research, and Information Order", (press release), February 22, 2011, accessed September 26, 2012.
  14. Cohn, Alicia M. "USDA backs off Christmas tree tax, will revisit issue", The Hill, November 9, 2011, accessed September 26, 2012.
  15. Addington, David S. "Obama Couldn't Wait: His New Christmas Tree Tax", The Foundry (Heritage Foundation blog), November 8, 2011, accessed September 26, 2012.
  16. Jackson, David. "Obama team delays Christmas tree fee", USA Today, November 9, 2011, accessed September 26, 2012.
  17. "About that 'Christmas Tree Tax', (editorial), The Wall Street Journal, November 14, 2011, accessed September 26, 2012.
  18. Reilly, Ryan J. "Tree Farmers Blast 'Sinister' 'Smear' Of 'Obama's Christmas Tree Tax'", TPM Muckraker - Talking Points Memo, November 9, 2011, accessed September 26, 2012.
  19. "Christmas Tree Promotion, Research, and Information Order; Stay of Regulations", (pdf), Federal Register, USDA - Agricultural Marketing Service, November 17, 2011, accessed September 26, 2012.
  20. Perkowski, Matuesz. "'Tax' anger stalls proposed checkoffs", Capital Press, May 4, 2012, accessed September 26, 2012.
  21. "Schroeder: Christmas Tree Check-Off Still in the Works, USAgNet, July 30, 2012, accessed September 26, 2012.
  22. "As Required by New Farm Bill, USDA to Allow Christmas Tree Research and Promotion Program to Move Forward Archived 2014-11-29 at the Wayback Machine", press release, United States Department of Agriculture, Agricultural Marketing Service, April 4, 2014, accessed November 18, 2014.
  23. "Rules and Regulations" (pdf), Federal Register, vol. 79, no. 66, p. 18987, April 7, 2014, via USDA Agricultural Marketing Service, accessed November 18, 2014.
  24. DeHaven, Tad. "GOP Fingerprints on the Christmas Tree Tax", Cato At Liberty (blog), Cato Institute, November 9, 2011, accessed November 19, 2014.
  25. Baskt, Daren. "Obama's Christmas tree tax is back", The Daily Signal (blog), The Heritage Foundation, June 4, 2013, accessed November 19, 2014.
  26. "Perkowski, Mateusz. USDA OKs raspberry checkoff", Capital Press, May 10, 2012, accessed November 19, 2014.

Further reading
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