Local News

State Lawmakers Not Happy With RJR's Decision To Reduce Tobacco Orders

Posted March 15, 2004

— RJ Reynolds recently informed farmers that it was cutting tobacco contracts in half. Some state lawmakers say the tobacco company is not living up to its end of a deal.

When state lawmakers met in special session to dole out more than $120 million in tax incentives for RJ Reynolds, the tobacco giant promised to return the favor with hundreds of new jobs at the Winston-Salem headquarters. Daughtry voted for those incentives and now feels betrayed because the company turned around and cut tobacco contracts.

"They're jerked us around. I'm very disappointed," said Leo Daughtry, R-Johnston. "They've misled us. They've said we want to do the right thing for your state. We want to add 800 jobs, but at the same time, knowing or having a good idea, they were going to cut their buying intentions."

Republican gubernatorial candidate Bill Cobey is making it a campaign issue. He said Gov. Mike Easley and state lawmakers never should have approved what he calls corporate welfare.

"It's unfair. It's not right to take money out of the pockets of other businesses and individuals and stick it in the pockets of these big corporations," Cobey said.

With tobacco farmers set to take another hit, legislators are now considering their options. One could be stamping out RJ Reynolds' incentives.

"I don't know what we can do about it, but I'm totally frustrated with it," Daughtry said.

RJ Reynolds has not yet talked specifically about the controversy. Officials only said their tobacco contracts have been squeezed by discount cigarettes and last year's merger. The company lost 2,600 jobs last year.

Gov. Mike Easley's office declined to comment.

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