Senators Reach Deal on Tobacco Buyout Program

Tobacco-state senators have reached a consensus on a bill to pay tobacco farmers (search) to leave a price and production control program that once guaranteed the industry economic security.

Farmers would not get the government-guaranteed high prices to grow tobacco under the bill introduced in the Senate Wednesday, although they could still grow it.

Farmers have been seeking a buyout, with many saying they want to get out of the business altogether, because they have experienced steep cuts in the amount of tobacco they can grow under the legislation already introduced in the House is more generous.

The House and Senate bills would require tobacco manufacturers to pay for the buyout, which could lead to an increase in cigarette prices.

Thirteen tobacco-state senators, including Senate Majority Leader Bill Frist of Tennessee, sponsored the legislation. Most agree it will have to be linked to a forthcoming bill giving the Food and Drug Administration (search) authority to regulate tobacco products.

Historically, tobacco state lawmakers and farmers have opposed FDA regulation of the cigarette industry. But they now say they need to forge an alliance with health advocates in Congress to get a buyout bill passed.

"We support reasonable FDA legislation that will be part and parcel of making this tobacco buyout a reality," said Larry Wooten, president of the North Carolina Farm Bureau (search).

Philip Morris USA (search), the nation's largest cigarette manufacturer, supports a buyout linked to FDA legislation. Company officials believe FDA regulation could make it easier for Philip Morris to market reduced-risk tobacco products that are in development.

Other companies have said they are concerned about the cost of a buyout and fear FDA regulation would be too burdensome.