April 13, 2017
The BC Chicken Marketing Board (BCCMB) is evaluating quota assessments as they pertain to chicken quota in BC. This review is part of the BC Farm Industry Review Board’s Quota Assessment Tools Evaluation, which requires all five supply managed commodity boards in BC to determine what, if any, changes to transfer assessment structures and/or industry entry policies are needed to maintain sound marketing policy, taking into account both industry and public interest.
In 2005, the BC Farm Industry Review Board (BCFIRB) provided principles and direction to B.C.’ s five supply managed agriculture commodity marketing boards to ensure the existence of programs to adequately support specialty markets and new farmers.
The four key policies from the 2005 Review that apply to this Evaluation Project include:
BCCMB’s objectives for this evaluation are:
During the first stage of the consultation process, the BC Chicken Marketing Board will hold regional face-face listening sessions with industry stakeholders (growers, processors, vendors and other industry participants) in conjunction with other spring producer meetings across BC. These sessions will take place from April 18 to May 31, 2017. The discussion will be focused on questions related to industry entry, the impact of transfer assessment policies on entry and quota movement and a traditional outlook on succession and quota assessment.
Entry to Industry
Transfer assessment policies on market entry and quota movement.
Traditional outlook on succession and quota assessment
In addition to in-person meetings, all broiler industry stakeholders and members of the public are invited to review the questions below and provide input via mail, email or online form.
Mail: Attn: Quota Transfer Assessment Consultations
BC Chicken Marketing Board
101 – 32450 Simon Avenue
Abbotsford BC V2T 4J2
Online Form: Simply submit your comments and/or feedback via the online form below under”Participation Questions.”
What are “transfer assessments”?
As per BC FIRB’s 2005 Specialty Review, transfer assessments are the surrendering back some of the seller’s quota when quota is transferred from one grower to another. Boards can redistribute the assessed quota in a manner to respond to specialty markets and provide opportunities for new growers. In 2005, four of the five marketing boards proposed that the assessment would be levied on the transferor (the farmer selling the quota) and reduce the amount of the quota available for transfer by 5%.
How does the BCCMB use transfer assessments?
For traditional mainstream quota, BCCMB uses a “deemed transfer assessment” whereby the amount of the assessment would be calculated as 5% of the total transfers in a period and the amount from this calculation would be deducted from the provincial allocation prior to distribution among quota holders. This approach has no exemptions for family members and/or corporate restructuring.
For incentive quota issued after 2005, BCCMB uses a “10-10-10” declining assessment, so that the last incentive quota issued is the first quota to be transferred. (“LIFO”).
What is ‘incentive quota’?
Incentive quota is quota issued by the board at no cost, such as new entrant grower quota or a pro rata increase.
What is “10-10-10”?
In the 2005 Specialty Review, BC FIRB directed the establishment of a declining transfer assessment for the transfer of incentive quotas. This schedule requires an automatic retraction of 100% in the first year after issuance. Subsequently, the amount retracted declines by 10% per annum until it reaches a minimum assessment of 10% in year 10.
What is “LIFO”?
“LIFO” is an acronym for “Last In, First Out.” In its 2005 Specialty Review, BC FIRB directed that a condition of “LIFO” be implemented on the transfer of any incentive quotas. In other words, the last quota issued by the board is the first quota to be transferred.
We would appreciate your responses to these questions to help guide our quota assessment evaluation.
You do not need to answer all of them.