ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Sunday, August 25, 1996 TAG: 9608270061
SECTION: EDITORIAL PAGE: 3 EDITION: METRO
SOURCE: FRANK KILGORE
THE RECENT jury verdict holding a tobacco company liable for selling a dangerous product and failing to disclose tobacco's hazards is one of many wake-up calls for tobacco-producing states. Previously undisclosed industry documents are turning up that are laying the groundwork for gigantic verdicts, criminal sanctions and a reversal of the tobacco industry's seemingly invincible legal positions.
Tobacco companies have long anticipated the day their defensive measures would fail. They have diversified holdings, invested in nontobacco interests and made one last push to create a younger generation of tobacco users.
Tobacco farmers, on the other hand, have been led to believe that through political action they could outlast tobacco's critics and continue their traditional method of harvesting a key cash crop. Vote-seekers have largely ignored the handwriting on the wall and continuously fail to prepare their farming constituents for the inevitable day that small to medium tobacco farms will disappear as a source of reliable income.
Leaders are needed, particularly in Virginia, to take advantage of the current demand for tobacco and wisely increase the current state tobacco tax for the benefit of farmers and their families.
A doubling of Virginia's tobacco tax would still make it one of the lowest tobacco-tax states in the nation. Used appropriately, the additional revenue will provide a substantial source of economic-development initiatives for small to medium farmers.
The new revenue from this proposed increase, approximately $15 million per year, should be returned to the tobacco-producing counties in proportion to the poundage produced.
A portion of the revenue could be used for public education to help reduce funding disparities in the rural tobacco-producing communities, which are often strapped for education revenues.
Or, the counties could use part of the revenue for economic-development initiatives through industrial-development authorities and the state's economic-development offices. The goal would be to diversify the local economies with emphasis upon the development and marketing of alternative cash crops.
At least one half of the new funds, however, should go directly into interest-free loans for tobacco farmers wishing to convert their land and equipment into other agricultural endeavors.
While $15 million per year spread throughout Virginia's tobacco counties doesn't sound like a lot, the direct return of the money to localities would be meaningful over the next several years. The tax increase would not noticeably impact Virginia's competitiveness in the current tobacco market, due to the state's efficient growing and processing of superior tobacco products.
The industry has long held itself out to be a friend of the small tobacco farmer, and the farmer and his family have responded by supporting tobacco-friendly legislation. Now is the time for the industry to do the same for its loyal tobacco growers, by supporting a program that places 100 percent of the new revenues into farm communities instead of frittered away by state or federal bureaucracies.
The last thing farmers need is more scare tactics by shortsighted officials. The most pressing action they need and deserve is leadership to install a model assistance program in Virginia that creates real results.
Frank Kilgore practices law in St. Paul.
LENGTH: Medium: 68 lines ILLUSTRATION: GRAPHIC: BOB NEWMAN/Newsdayby CNB