• Replace inflammatory rhetoric, stereotyping, and automatic enmity in favor of civil, problem solving dialogue;
• Understand each others' needs, values and concerns;
• Identify areas of common ground and even interdependence, while acknowledging areas of difference; and, finally,
• Work together to create realistic, sensible and sustainable options for communities and families facing pressures associated with transition.

Greetings to participants in the Southern Tobacco
Communities Project listserve!

Here is a summary current as of June 15 of some of the key
items affecting tobacco producing communities based on news
reports and conversations with people in tobacco-producing
states.  I am including state legislative news, some of
which is dated as far back as April.  As always, please
feel free to forward items of interest to me.

Regards,

Frank Dukes

REGIONAL AND NATIONAL NEWS-

The single best web site for keeping up with
tobacco-related news of all sorts is
http://www.tobacco.org.  It provides daily summaries of
news articles under categories as diverse as
"agriculture," "international," and legal news, and you can
often access entire news articles directly from that web
site.

* All of you have heard by now that the U. S. Supreme Court
upheld the 4th U.S. Circuit Court of Appeals ruling in 1998
that the FDA could not regulate tobacco. The court said
that decision is up to Congress.  A number of bills are
being prepared that would give FDA jurisdiction and a
lively debate is anticipated, with the outcome as yet
uncertain.

* R.J. Reynolds announced that it would expand the
marketing of its experimental Eclipse cigarette, a product
that heats rather than burns the tobacco, with the launch
of an advertising campaign that will make health claims for
the product.  The 20-year, estimated $1 billion effort to
develop a marketable low-smoke cigarette has met with
repeated failure to date.  The ads will present Eclipse as
the next best thing to quitting. They will also make the
specific claims that, compared to smoking conventional
cigarettes, smoking Eclipse "may reduce the risk of
smoking-associated cancers" and lower the risk of lung
disease. (Washington Post, April 19 and followup).

Among other complaints about the proposed advertising
campaign are the following:

The American Lung Association called on the R. J. Reynolds
Tobacco Company to withdraw its Eclipse nicotine delivery
device from the market.  ALA claimed that the Eclipse
device is not a cigarette but a high-tech nicotine delivery
device that R. J. Reynolds is touting as a safe alternative
to cigarettes.  ALA expressed fear that this kind of
marketing may discourage people from quitting smoking.  ALA
pointed out that research on the product raised serious
health concerns.  It also noted that the Food and Drug
Administration (FDA) has not tested or approved this drug
delivery device for sale in the United States.  (American
Lung Association, June 1)

Secretary of Health and Human Services Donna E. Shalala
issued a release saying "We have significant concerns about
the marketing plans R.J. Reynolds is announcing for its new
product, Eclipse.  It is not at all clear that a sufficient
science base exists to support a bold claim that this
tobacco product may reduce the risk of cancer.  Nor is it
clear what advice doctors should give their smoking
patients who wonder if they should switch to a product like
Eclipse.  What we do know is that cigarettes and other
tobacco products in any form are unsafe, dangerous, and
cause great pain, suffering and death.  We know that
Congress has it within its power to pass legislation to
give FDA clear jurisdiction over tobacco products.  But we
need to know much more about the extent of any reduction in
exposure to toxins, and whether this actually reduces the
overall risk of smoking in a meaningful way.  Until then,
smokers should be very careful about assuming that products
like Eclipse are in any way safer than cigarettes."

* Saying it now believes that "blue mold" on U.S. tobacco
is not a problem, China has agreed to drop restrictions on
U.S. tobacco imports.  Beijing probably would have been
forced by the World Trade Organization to drop any
restrictions on U.S. tobacco due to blue mold.  Its
decision, however, came days before Congress voted on
granting normal trade ties to China (Bloomberg News, May 17)

* A number of states are considering the possibility of
securitization of their tobacco settlement dollars.
Securitization means that the state would forfeit any
future payments in order to receive a large payment
up-front by selling bonds backed by settlement payments.
Up-front payments will vary, depending on states' plans.
This is a familiar process to many in state government, as
governments often issue bonds to secure capital.
Securitizing tobacco payments, however, is somewhat
different.  For more information you can go to:
http://www.nga.org/CBP/Center.asp

* Tobacco farmers will receive $340 million in emergency
aid this fall under a farm-assistance package approved by
Congress. The $15 billion package, which won swift House
and Senate approval, includes $5.5 billion in direct
payments to all farmers. Leaf growers will receive the
payments after the 2001 federal fiscal year starts Oct. 1.
 

KENTUCKY

* The House Appropriations and Revenue committee passed
House committee substitute to Senate Bill 49. The committee
substitute will protect small tobacco farmers in contract
tobacco.  SB 49 exempts tobacco farmers from taxes on the
Phase II tobacco settlement money.  The committee
substitute, known as the Tobacco Farmers Protection Act,
would set up a farmer-based Commission that would develop a
model contract that tobacco companies would be encouraged
to use and offer to farmers. The committee substitute
confirms Kentucky's commitment to the tobacco program as
the most efficient and best way to market tobacco. This
legislation also allows for fair and equal distribution of
contracts among all producers who desire to contract,
regardless of the size of their tobacco base.

* The Kentucky State Legislature allocated from the Tobacco
Settlement for Tobacco Prevention and Cessation:
… $2,527,500 during year one and $3,040,000 during year two
for tobacco prevention/cessation programs in the Department
for Public Health
… $2,500,000 annually for two years to the "Kentucky Agency
for Substance Abuse Policy (KY ASAP) Smoking Cessation
Program"
… This amount ($10.5 million over two years) is roughly
twice that proposed by Governor Patton in January.

* Philip Morris USA is proceeding with its
direct-contracting program for burley tobacco.  It's a move
that has drawn considerable disapproval from burley co-op
leaders.  The company claims that it has been concerned
about the stability of leaf production under the federal
program -- particularly about the company's ability to buy
sufficient quantities of the grades and styles of burley it
needs to produce the flavor its customers expect.

* There has been some discussion that some Kentucky
activists may propose raising the state excise tax on
cigarettes and use the increased funding to buy out quota
holders.

* This year the Commodity Growers Cooperative Association
(CGC)will award over $70,000 in grants through the Tobacco
Communities Reinvestment Fund (TCRF).  CGC created TCRF in
1997 to provide grants and low-interest loans to farmers
for demonstration projects in farm
diversification.  Since then CGC has awarded over $223,000
in grants and loans directly to farmers and farm groups
throughout Kentucky.  Money for TCRF thus far has been
provided by the Burley Tobacco Growers Cooperative
Association, the Office of the Kentucky Attorney General,
Fifth-Third Bank Trust and KY ACTION.  The Commodity
Growers Cooperative Association is also sponsoring a farm
fund benefit concert at Garrett's Orchard in Woodford
County on Saturday, July 29, 2000 to raise additional funds.

The Commodity Growers Cooperative Association (CGC), an
affiliate of the Burley Tobacco Growers Cooperative, works
to develop markets for family farm products in Kentucky,
Ohio, Indiana, Missouri and West Virginia.  Established in
1941, the CGC operates programs in three program areas:
(1) Education and Training in Marketing and
Entrepreneurship; (2)Increasing
Access to Capital for agricultural enterprises, from both
the public and private sector, and; (3)Developing and
recommending policies for sustaining family farm
agriculture at the state and national level.  For more
information about CGC, locate the website at
www.commoditygrowers.org.

* House Bill 611, the tobacco settlement legislation
enacted by Kentucky's 2000
General Assembly, establishes a statewide Agricultural
Development Board and local county councils for
agricultural development and diversification throughout the
Commonwealth, making
available approximately $180 million over the biennium for
proposals from local, multi-county, regional and statewide
groups for agricultural development.
 

NORTH CAROLINA

* The Golden Long-term  Economic Advancement Foundation,
whose purpose is to
help struggling  tobacco-dependent communities, is supposed
to control half of the $4.6 billion that cigarette makers
have promised to pay North Carolina.  But since payments
are tied to the economic health of tobacco companies, this
Foundation fears that these payments could dry up.
Foundation members are considering how to avoid that risk
by selling the right to future payments in exchange for
cash upfront.
 

SOUTH CAROLINA

Though the State Legislature had originally talked about
allocating $12 million for tobacco control, they recently
knocked the number down to $3.5 million.  Half of this
would go to the state health department and half to alcohol
and substance abuse programs.

Currently the expected breakdown of tobacco settlement
money will be 70% to health, 20% to rural economic
development, and 10% to farmers.

South Carolina may be the first state to securitize its
tobacco settlement payments.

TENNESSEE

* The Tennessee State Legislature may use tobacco
settlement money for "general purposes."  Part of this
would be a bail-out of their Medicare program.  A June 15
article describing the settlement spending plan in more
detail will follow this summary.
 

VIRGINIA

* Virginia tobacco growers have signed contracts to sell at
least 30 percent of this year's crop directly to tobacco
companies, a change that deals another serious blow to the
tobacco auction system.  More than 200 tobacco farmers in
Virginia signed contracts to sell part of their crop to
Star Scientific Inc.  The Petersburg-based company will buy
about 14.5 million pounds of Virginia tobacco this year.
Farmers have several incentives to sign contracts with
Star. The company supplies growers with barns that are
specially designed to cure tobacco leaf in a way that
reduces nitrosamines.  With a Star contract, farmers are
rewarded with a premium price of $2 per pound for their
tobacco, about 25 cents more, on average, than a farmer
would get for tobacco at auction.  However, because it
costs more to operate the special curing barns, farmers
actually get about a 20-cent premium per pound.  (Media
General News Service)