Cautious Optimism Greets Progress on Tobacco Buyout Bill

Source from:  By Scott Sisco, ssisco@bgdailynews.com  06/21/2004

A tobacco buyout may be closer than ever after passing the U.S. House of Representatives on Thursday, but area farmers aren't making plans to spend the money yet. "We've talked this thing out the last three or four years," Warren County farmer Larry Hayes said. "It always seems to die somewhere down the road." The buyout bill is attached to a bill lowering corporate tax rates to compensate for trade sanctions on U.S. exports – cuts some claim go too far. The trade sanctions, now 8 percent, rise another 1 percent each month. The bill passed the House, with many Democrats siding with Republicans for a 251-178 approval. While lawmakers from tobacco-growing districts favored the buyout, others had concerns about its $10 billion cost. "The numerous special-interest provisions made this a questionable bill at best, but the addition of the tobacco-buyout provision was the straw that broke Joe Camel's back," said Rep. Jeff Flake, R-Ariz. House Republicans said resolving the European standoff and infusing new tax cuts into the economy would mean better economic growth and more jobs. "Tariffs is another word for taxes," said Rep. J.D. Hayworth, R-Ariz. Many Democrats disagreed. "You can put lipstick on a pig, but you can't call it a lady," said Rep. Charles Rangel, D-N.Y. "This is a lousy bill, and it has nothing to do with reform." The bill now goes to a conference committee, where the House and Senate will iron out differences. The committee could begin looking at it as soon as next week, according to Rep. Ron Lewis, R-Ky. "This is a piece of legislation we really need to get out of the way," he said. The buyout proposal would give $7 a pound to quota owners and $3 a pound to growers. Quota owners who also grow the tobacco would get $10 a pound. Quota owners are defined as owning the quota on the day before the enactment of the bill, growers as those who were eligible for growing in 2002. Payments would be made in equal installments over five years, and the current tobacco production program and the price support system would both be eliminated. Sen. Jim Bunning, R-Ky., has talked to leaders in his party who will probably be a part of the conference committee. "I think it's very important that we let them know our feelings and I've already done that," he said. Bunning has supported a buyout since the beginning of the idea, but admitted the cost of the buyout could be a concern. "We have to make sure that people understand this is not a buyout for tobacco," he said. "It's for our tobacco farmers to buy out what's left of the quota." If it does pass, Hayes said he would welcome the assistance and the chance to be able to compete more with international growers. Kentucky Gov. Ernie Fletcher supports the bill. "I would like to congratulate and show my appreciation to my former colleagues in the House who have carried on with this legislative effort that Kentucky farmers need," Fletcher said in a statement Thursday. "It is critical that we give our family farms the support they deserve so that they can make the decision to either move on from tobacco farming or choose to stay in." Warren County tobacco farmer Joe Chapman said he's glad to see the buyout this close to fruition. "It's been a long time coming," he said. The current proposal, which would pay out $9.6 billion based on the 2002 quota, pays less than some proposals, Chapman said. Any proposal that eliminates the quota system would help, as tobacco growers have had to pay increased lease prices over the past few years because of lower quotas. "We just can't compete worldwide when we're not abiding by the same rules," Chapman said. The proposal doesn't include regulation of the tobacco industry by the Food and Drug Administration. Lewis said the FDA could be included when the bill goes to a conference committee, but House leaders and President Bush may not be in favor of that. "If it comes back to the house with FDA in it, that could be a problem," he said. " ... It's hard to tell someone what to do if you don't know how to do it yourself." Logan County farmer Tom Brown said the buyout sounds pretty good. "If they keep the FDA out of it, I think it will keep everybody happy," he said. "We'll just have to wait and see how it goes." Another senator asked Bunning if he could support a proposal that included the FDA. "I don't want it, but for the good of our farmers, I'll do what I have to do," he said. For the first time, most of the people involved seem to be on the same page as far as the buyout goes, Brown said. Larry Gomer, District 24 representative for the Burley Tobacco Grower's Association, said farmers will have to see the finished product before they believe it. "I think we need to get this done in order to get our market share back," he said. The buyout has been talked about much more now than before, both pro and con, Gomer said. "At least it's getting the attention," he said. Gomer said he doesn't see how it will pass without FDA involvement, though Lewis suggested one possibility is to pass the buyout, then decide if and what role the FDA would play. Philip Morris has been the only cigarette maker that has come out in favor of the FDA's involvement. "There's a lot of hurdles there because of the clout that (other companies) hold politically," Gomer said. Enditem