Wisconsin Potato Industry Board Votes to Increase Potato Assessment
The Wisconsin Potato Industry Board unanimously passed a motion at its May 4, 2018 meeting to increase the assessment on Wisconsin potatoes by one cent per hundredweight. The assessment will now be a total of eight cents per hundredweight effective July 1, 2018.
The purpose behind the assessment increase is to generate an additional $250,000 per year in order to meet the WPIB’s commitment to establishing a potato research fund through the University of Wisconsin Foundation where funds are controlled and directed by potato grower representatives. The plan is to dedicate $500,000 per year over a ten year period to create a fund of $5 million. The WPIB has used a portion of its reserve funds during the first two years of this ten year plan to meet its commitment.
By increasing the assessment, the WPIB is following a recommendation made by the WPVGA Board of Directors asking for an increase in the assessment to establish a Donor Advised Fund through the University of Wisconsin Foundation. The original goal was to generate $10 million with $5 million generated by the WPIB and the balance through in-kind and/or private contributions.
The original recommendation from the WPVGA board was for a two cent/cwt. increase in the 2016 Wisconsin potato assessment dedicated to the fund over 10 years. However, WPIB rules limit assessment increases to no more than one cent per year. Thus the WPIB decided to increase the assessment one cent effective July 1, 2016 and allocated an additional $250,000 from reserves to generate the goal of $500,000 the first year. The WPIB elected not to increase the assessment in 2017, and followed a similar plan that also used reserve funds to meet that year’s $500,000 commitment.
The University of Wisconsin Foundation Donor Advised Fund (DAF) is structured as a quasi-endowment and has seven potato industry representatives as an advisory group which directs the funds to support areas that it determines to be its priorities. There are no operational details included in the DAF, which allows the advisory group the flexibility to support changing priorities over time. The WPIB carefully reviewed the structure of the DAF prior to making the actual commitment of funds.
Both the WPVGA Board and the Wisconsin Potato Industry Board believe a new funding model is necessary to maintain and grow the existing UW potato and vegetable research team into the future. Alternative financial support from industry or alternative sources will be necessary to maintain the partnership between the WPVGA and the University of Wisconsin. Funding is specifically needed to:
- Support salary and fringe benefits to help fill future faculty vacancies;
- Support operational and maintenance costs for agricultural research stations and projects; and
- Enhance the salary and/or fringe for current faculty to maintain the competitiveness of the UW.
Wisconsin’s potato assessment will change from seven cents per hundredweight to eight cents per hundredweight effective July 1, 2018. All Wisconsin potatoes sold after June 30, 2018 will be subject to the eight cents/hundredweight assessment.