Local farmers hopeful of new tobacco plan

Source from:  jdooley@bgdailynews.com By Jason Dooley 05/26/2004

A few months ago, a tobacco quota buyout plan looked all but dead, but two bills in Congress may give it new life. Lawmakers in both the Senate and House introduced legislation last week that would give the Food and Drug Administration broad authority over cigarette sales, and lawmakers speculated the bills could be linked to a buyout plan on the Senate floor. That's good news for farmers, who have been pushing for a buyout program for years, Warren County Agriculture Extension Agent Joanna Coles said. "The market is at the point where they can't get a lot of profit with lease prices and so on," Coles said. "They really need a buyout." While farmers would prefer that the buyout bill not be combined with putting tobacco in the FDA's bailiwick, that appears to be the only real chance for the proposal this year, she said. "In a perfect world, they could get a buyout without FDA regulations, but we're at crunch time now," Coles said. "We really need this legislation, and if it's going to happen this year, it looks like FDA regulations would have to be part of it." But many farmers have lost hope in a buyout program after years of disappointment, said Ronnie Hargett, who raises tobacco on his farm in Rich Pond. "We've heard so much about the buyout that I've just about gotten sour on it," Hargett said. "It's been kicked around and fooled with for several years and nothing's ever come of it, but if it did come about, it would be a benefit because lease prices have gotten so high." Farmers are also concerned that a buyout program might mean the loss of Phase II tobacco settlement funds, Hargett said. "After a certain point, we'd probably be better off to continue with those payments, which still have several years left, instead of a buyout," he said. "So that's another consideration." Many of the people holding tobacco quotas now are no longer producing tobacco and are instead leasing their bases to other farmers every year, but competition for the leases has driven the prices up, he said. "There's just not much money left by the time you get done with your materials and the leases and your labor," Hargett said. "So there really is a need to get these quotas out of the hands of people who don't want to produce tobacco with a fair settlement." If the quota system were abolished, tobacco growers would be able to raise more tobacco if they wished, but Hargett said he probably wouldn't take advantage of that opportunity. "A quota buyout is not going to make me want to go raise more tobacco because it's such an expensive crop to put out because you need so much help," he said. "The last few years, it's been really hard to find help, and the ones you do find aren't the kind of workers you really want to hire." Last year, finding enough workers to cut and house his tobacco was such a troublesome task that he almost gave up on raising tobacco this year, planning to cut back, Hargett said. "But then spring came, and just like every farmer, I thought, 'Well, it's time to put out a crop,' " he said. "But I know I wouldn't want to raise any more than what I'm raising now, even with a buyout." Lease prices are high for farmers across the state, said Ryan Nunn, who raises tobacco with his father on a family farm outside Henderson. "They go up every year," Nunn said. "The people who have the bases all want to get as much out of them as they can without having to produce a crop, so the price keeps going up." Nunn, 25, is recently married and just bought a new home. A quota settlement package would probably net him between $30,000 and $60,000 over the next several years, enough to pay off much of his debt, while for his father, the benefit would essentially serve as a retirement plan, he said. "I think that's how a lot of the older farmers are looking at it – a chance to get out of producing tobacco with some money to put away for their retirement," Nunn said. "And then for people my age, it's a way to get caught up so that you aren't starting out so far behind." Kentucky Farm Bureau President Sam Moore, a Butler County farmer, sent a letter to farmers statewide this week, urging them to call their congressmen about the bill, and Moore has been in Washington, D.C., all week lobbying for it. The chances for a buyout bill look much stronger now than they did as recently as the end of April, although some lawmakers remain cool toward the proposal, Coles said. "At the end of last month, we were very doubtful, but this bill has given it new life," she said. "At least it's more attention drawn to it and it looks as though we have some support for it." Sens. Mike DeWine, R-Ohio, and Edward Kennedy, D-Mass., have been haggling over the details for the past several months, after a near-deal collapsed last fall. House sponsors are Rep. Tom Davis, R-Va., and Henry Waxman, D-Calif. The legislation forbids the FDA to ban cigarettes and says the agency can reduce, but not eliminate, addictive nicotine. Marketing terms such as "light" and "ultra-light" would be prohibited unless the FDA approved them. That is unlikely to happen, since studies have shown those cigarettes haven't reduced health risks faced by smokers. Senate lawmakers from tobacco states who previously fought FDA regulation now say they would support it in exchange for support of a measure that would pay tobacco farmers to leave the federal system that sets price and production controls on U.S. leaf. Farmers say they want out of the system, which in recent years has dramatically restricted the amount of tobacco they can sell. The Associated Press contributed information for this story. Enditem