A Checkoff is an industry-wide, coordinated and continuous program of research, promotion, and education to support specific generic products. Checkoff programs allow commodity producers to raise funds through self-imposed mandatory assessments.
Checkoffs are created to generate the funding necessary for an industry to successfully develop, implement, and manage programs needed to increase sales and expand markets. Well-funded, properly planned, and carefully monitored programs help create product awareness, increase business opportunities, and enhance product sales for all producers. Increased sales create jobs, expand payrolls, and increase tax bases which benefits local economies.
Checkoff Programs generate the funding that enables an industry to provide a coordinated and continuous process of research, education, and promotion. They are funded by a fair and equitable assessment on all products produced within an industry. The assessments are collected at the point of sale.
Because all producers within the industry contribute to the program equally, Checkoffs reduce the inequity associated with free-riders that do not contribute equally in voluntary programs. Also, the participation of all producers ensures a broader funding base, lowering the costs for all involved. Checkoffs also have lasting power.
Once enacted, Checkoffs can be terminated by the industry that creates it, but only through a referendum. Thus, sustained funding over multiple years enables industries to tackle larger programs that have greater potential for market impact.
Most of the existing programs are related to either farm or energy programs. The only checkoff program in operation for construction-related materials is the North American Softwood Lumber Board.
Each of the existing programs have numerous success stories related to increasing consumer awareness about the benefits of their products, or creating new markets for the use of their products that increase both sales and demand to the benefit of the producers within the industry.