According to a recently published state.pa.us and Pennsylvania Department of Agriculture press release, Pennsylvania’s statewide tobacco farmers will receive a total of $11 million from tobacco companies.
The $11 million will be from a settlement that resulted after a North Carolina court room ruled in the state of Pennsylvania’s favor after a 1999 agreement between the state’s and the country’s largest tobacco companies went sour due to the federal Fair and Equitable Tobacco Reform Act of 2004, which then resulted in payments to the state being delayed.
Pennsylvania Department of Agriculture Secretary Dennis Wolff said of the case and the settlement, “After working for nearly two years to secure payments, this settlement is a victory for Pennsylvania’s 500 tobacco growers. Our farmers have experienced difficult economic times since the 1999 agreement was signed. It is reassuring to know the payments will resume so Pennsylvania’s tobacco growers can make the needed investments in their farms and continue playing a vital role in our state’s agriculture industry.”
As previously stated, the payments to Pennsylvania’s farmers were first delayed when the tobacco manufacturers became concerned about their obligations under the federal Fair and Equitable Tobacco Reform Act, which was passed by Congress in three years ago in 2004.
The federal act passed in 2004 provided for a large tobacco quota buyout for most of the country’s growers, but not in the states of Pennsylvania and Maryland.
However, due to the North Carolina court’s decision, the tobacco companies still must pay the tobacco farmers in Pennsylvania and Maryland for their production and work. The payments will be paid out through a trust up until 2010.
The tobacco trust was originally started to help Pennsylvania and 13 other states that grow tobacco for companies to use in cigarettes, cigars, chewing tobacco, etc.
Problems started when the 2004 act was passed and the major tobacco companies stopped making payments to state farmers, hurting their production and funding.
Wolff added, “We applaud the North Carolina court’s decision to hold the tobacco companies’ accountable and provide our farmers the economic assistance agreed to in 1999.”
Aside from Pennsylvania tobacco farmers receiving $11 million, Maryland farmers will be receiving a huge $13 million settlement from the country’s major tobacco companies which will also be paid out through the year 2010.
More information when available will be published in the form of a press release at the Pennsylvania Department of Agriculture’s official state web site at http://www.agriculture.state.pa.us/