USDA Holds Meeting on Tobacco Transition Assessments

Release No. 0500.04
Julie Quick (202) 720-4623
Jillene Johnson (202) 720-9733

WASHINGTON - The U.S. Department of Agriculture will hold a public meeting in Washington, D.C. on Nov. 22, 2004, to solicit public input on tobacco transition program assessments. The tobacco transition program was authorized by the Fair and Equitable Tobacco Reform Act of 2004 (the Act), signed by President Bush on Oct. 22, 2004. The program terminates the New Deal-era tobacco quota program and establishes a 10-year transitional payment program funded through assessments of approximately $10 billion on domestic manufacturers of tobacco products and importers of foreign tobacco.

The public meeting will help USDA determine how tobacco transition assessments will be collected, the timing of the collection and the assessment shares, among other issues.

The meeting will be held in the Jefferson Auditorium of the USDA South Building, 1400 Independence Avenue, SW, Washington, DC 20250. The meeting will begin at 9:00 a.m. and will end no later than 4:00 p.m., Eastern Time. Attendees are advised to arrive early in order to clear building security. In order to gain access to the building, attendees must bring a government-issued photo identification.

The deadline to register in advance is Nov. 18. Registration may be completed via e-mail at: tob_comments@wdc.usda.gov, by phone through Mary Tjeerdsma at (202) 690-2524 or by fax at (202) 720-6426. On-site registrations will also be accepted. Persons requiring special assistance or accommodations should note this upon registering.

Interested parties can be primary speakers, meaning they are included on the meeting agenda and provided an allotment of time to speak. Persons who wish to be primary speakers must either e-mail: tob_comments@wdc.usda.gov, or contact Mary Tjeerdsma at (202) 690-2524 (voice) or (202) 720-6426 (fax) by November 18 and provide a brief, written statement regarding the nature of the information they intend to present. If time permits, other meeting attendees may make 5-minute presentations on a first-come, first-served basis.The meeting will be webcast live on the Internet beginning at 9:00 a.m. on USDA Farm Service Agency's (FSA) tobacco webpage located at: http://www.fsa.usda.gov/tobacco/ Persons who cannot attend but wish to provide statements to FSA may mail comments by December 1 to: Director, Tobacco Division, Farm Service Agency, United States Department of Agriculture, STOP 0514, Room 4080-S, 1400 Independence Avenue, SW., Washington, DC 20250-0514; or via e-mail at: tob_comments@.wdc.usda.gov.

Additional information on the meeting will be available in a Federal Register notice to be published on November 17. The notice will be available at: http://www.fsa.usda.gov/tobacco/

Initial Tobacco Transition Assessment Program Provisions USDA also announced initial determinations for implementing the tobacco transition assessment program. The transition program will require USDA to issue two regulations: (1) regulations governing how USDA's Commodity Credit Corporation (CCC) will determine and collect $10 billion in assessments; and (2) regulations setting forth the eligibility criteria CCC will use in issuing payments to eligible owners of tobacco marketing quotas and acreage allotments and producers of eligible kinds of tobacco in the 2002, 2003 and 2004 crop years. The Nov. 22 public meeting will focus on the first regulation only.

The Act limits the total amount of assessments that may be collected to $10.14 billion. The Act further mandates that payments be made at $10 per pound over 10 years with $7 of the payment to be made to the quota owner and $3 to producers. USDA does not yet know the total number of owners and producers who will participate in the program and is still reviewing other program decisions. Accordingly, the Secretary announced that the fiscal year 2005 assessment amount will be determined and announced at a later date. As provided in the Act, this initial assessment will be divided among the different segments of the tobacco industry.

As required by the Act, individual company-level assessments within each of these industry segments will be collected based on the volume of production and imports used to collect excise taxes and custom duties by the Department of Treasury and the United States Customs and Border Patrol of the Department of Homeland Security. These two agencies receive monthly reports from the companies and CCC will use these monthly reports to determine compliance with the law. CCC intends to make preliminary decisions regarding the manner in which assessments may be remitted to CCC which will be announced before the end of the first quarter of fiscal year 2005.

Determinations on the tobacco transition payment program will be announced later. Enrollment is anticipated to begin in the spring of 2005. Additional information regarding the tobacco transition program is available at: http://www.fsa.usda.gov/tobacco/