Tobacco Farmers Seeking Funds

Source from:  By Bruce Schreiner Associated Press LOUISVILLE 05/11/2005

Burley tobacco growers have watched tobacco-settlement money flow into such ventures as aquaculture and vegetable farming to lessen Kentucky's dependence on tobacco. Now some tobacco farmers think it's their turn to tap the same fund. Such assistance, they say, would help secure Kentucky's dominance as a burley producer in a new era after the end of the federal tobacco price support and production quota system. A group of burley growers has asked the state Agricultural Development Board to put tobacco farmers in line for so-called Phase I funds, paid by tobacco companies to Kentucky and other states to settle litigation over costs for treating smoking-related illnesses. For farmers sticking with tobacco after the federal tobacco buyout, the assistance could help build or remodel curing barns, add irrigation systems or buy equipment. The plan's proponents say Kentucky producers face new competition in the post-buyout era in which tobacco companies are looking for the most efficient farmers to grow their leaf under contract. And despite its decline, burley tobacco remains an important crop, they say. "Burley is going to be grown, no matter what," David Wimpy, a Christian County tobacco farmer supporting the plan, said in a phone interview. "It's just whether Kentucky wants to keep this industry like we've always had it. Now if we get a closed mind and say this industry is over, it's going somewhere else where some farmers are willing to grow it." Unlike some awards aimed at making Kentucky a new player in some ag enterprises, investing Phase I money in tobacco would help retain a proven cash generator, Wimpy said. "We know how to grow it and grow it as well as anybody," he said. Mike Kuntz, a spokesman for the American Lung Association of Kentucky, said the plan amounted to "archaic thinking" running counter to diversifying away from tobacco. "I think it's pretty clear the writing's on the wall with tobacco in this country," said Kuntz, noting declines in U.S. smoking rates and tobacco companies' appetite for foreign leaf. Kuntz added that anti-smoking efforts are "woefully underfunded" in Kentucky, despite offering the potential for considerable savings in health costs. Under the group's proposal, tobacco farmers seeking Phase I assistance would pay half the costs to upgrade their operations. The state would contribute $3.4 million in Phase " money over two years, as would the Burley Tobacco Growers Cooperative. Also, Phase I money sent to counties -- about $19 million this year -- could be awarded to tobacco farmers by county agricultural development councils. Keith Rogers, executive director of the Governor's Office of Agricultural Policy, said the proposal is being studied and could come up at the state ag development board meeting May 20. Rogers said farmers wanting to stay in tobacco should have the same opportunities as those switching to other crops. However, based on the state board's policy, Rogers said, it's "very unlikely" state Phase I funds would go to individual tobacco growers. Sam Moore, an ag development board member, said he supported giving county councils the option to award part of their Phase I share to tobacco farmers. He said such support could especially help ex-tenant farmers who used barns and equipment provided by landlords who exited tobacco after the buyout. "We need to look at anything we can to preserve and protect the tobacco industry in this state," said Moore, president of the influential Kentucky Farm Bureau. Danny McKinney, CEO of the burley tobacco co-op, said the co-op's board is reviewing the proposal. He said burley production is still important to rural Kentucky and that "efficiency is the name of the game." "It's still the best dance in town and in a lot of cases the only dance in town for a lot of farmers," he said. "There's still no other legal crop that you can produce that's going to bring in the income that tobacco does." With the end of quotas, tobacco production is expected in such nontraditional growing areas as Pennsylvania, Rogers said. In North Carolina, a foundation that receives part of the state's tobacco settlement has given a grant for research into burley production in flue-cured regions. Valeria Lee, president of the Golden LEAF Foundation, which approved the $264,800 grant for scientists at North Carolina State University, said there's still a market for burley. "Our board was convinced there are opportunities for farmers in growing burley tobacco," she said. The prospects of burley expanding into new regions is catching the attention of Kentucky agricultural officials. "If we don't take note of this and do what we can to preserve burley tobacco production in Kentucky, we could very well wake up five or 10 years down the road and significant parts of it, or all of it, could be gone," Rogers said. Enditem