Exemption of Organic Products From Assessment Under a Commodity Promotion Law
On December 30, 2015 The United Stated Department of Agriculture (USDA) posted the Final Rule to expand the exemption for certified organic products from assessments collected by commodity promotion programs and marketing orders administered by USDA’s Agricultural Marketing Service. This rule is effective as of February 29, 2016.
The new ruling extends the exemption to entities producing “organic” and “100 percent organic” products, regardless of whether the entity requesting an exemption also produces non-organic products.
Click here for the complete ruling.
If you have a grower who would qualify according to the above requirements the steps for a certificate of exemption are as follows:
The exemption needs to be resubmitted annually for approval on or before January 1st as long as the producer continues to be eligible for the exemption.
Per USDA’s Final Rule, included in the expansion of the organic checkoff exemption, a refund provision is included. Specifically, this provision allows for a producer to apply for and receive an exemption from USB and submit a request for a refund to their first purchaser. This provision is effective as of February 29 ,2016 and going forward, will be retroactive for 5 years up to and including the effective date (2/29/16), not before the effective date (2/29/16). I’ll provide 2 examples to demonstrate the direction from USDA:
On December 30, 2015 The United Stated Department of Agriculture (USDA) posted the Final Rule to expand the exemption for certified organic products from assessments collected by commodity promotion programs and marketing orders administered by USDA’s Agricultural Marketing Service. This rule is effective as of February 29, 2016.
The new ruling extends the exemption to entities producing “organic” and “100 percent organic” products, regardless of whether the entity requesting an exemption also produces non-organic products.
Click here for the complete ruling.
If you have a grower who would qualify according to the above requirements the steps for a certificate of exemption are as follows:
- Complete the Organic Exemption request form
- Attach a copy of NOP Certification
- Forward to the United Soybean Board, 16305 Swingley Ridge Road, Suite 150, Chesterfield, MO 63017
The exemption needs to be resubmitted annually for approval on or before January 1st as long as the producer continues to be eligible for the exemption.
Per USDA’s Final Rule, included in the expansion of the organic checkoff exemption, a refund provision is included. Specifically, this provision allows for a producer to apply for and receive an exemption from USB and submit a request for a refund to their first purchaser. This provision is effective as of February 29 ,2016 and going forward, will be retroactive for 5 years up to and including the effective date (2/29/16), not before the effective date (2/29/16). I’ll provide 2 examples to demonstrate the direction from USDA:
- If a producer were to submit a request for refund from the checkoff to their first purchaser on March 1, 2018, the first purchaser would be required to go back to the effective date of the expansion (2/29/2016) and no earlier, to calculate the requested refund.
- On the other hand, fast forward to January 1, 2025 and a producer requests a refund from their first purchaser, the first purchaser can only go back as far as January 1, 2020 (5 years prior) to calculate the refund. The first purchaser would not be required to look back any further than 5 years prior to the request date.
