Senate Approves $12 Billion Tobacco Buyout Plan
Posted July 15, 2004
WILSON, N.C. — The Senate approved a plan Thursday to put new restrictions on cigarette makers and pay tobacco farmers $12 billion to give up federal quotas propping up their prices.
An unlikely alliance of anti-smoking advocates and tobacco-state senators teamed up to secure the 78-15 vote to combine a 10-year buyout for tobacco growers with new Food and Drug Administration powers.
The measure was added as an amendment to a corporate tax bill and broke weeks of deadlock over how to proceed with negotiations on that bill.
Supporters had worked to get the buyout and new FDA authority to regulate cigarettes attached to the tax bill so talks could begin with the House on a compromise. The FDA would regulate tobacco not as a drug but as an entirely separate product category.
A bill the House passed last month included a smaller $9.6 billion tobacco buyout over five years and no new FDA regulations on manufacturing and marketing cigarettes and other tobacco products.
The Senate would make tobacco companies pay for the buyout through a user fee that could be passed on to smokers. The House would spread the cost of its version to all taxpayers.
Tobacco farmers are picking the first of this year's crop getting ready for markets to open in August. For them, the news of the buyout has put them on pins and needles.
"It's not surprising. We've been on an emotional roller coaster in this tobacco industry the last four or five years anyway," tobacco farmer David Blalock said.
Blalock said he and many other farmers were optimistic when the House approved buyout legislation for the first time last month. He said they also knew there was still a long road ahead.
"It's been kicked around quite a bit. We feel like a political football I guess," he said.