Davis Supports Bi-Partisan Tobacco Buyout Legislation September 25, 2003

WASHINGTON, D.C. -- U.S. Rep. Lincoln Davis is supporting bi-partisan legislation that would greatly benefit Tennessee's tobacco farmers and economy. H.R. 3160, the Tobacco Reduction, Accountability and Community Enhancement Act (TRACE) is a result of the widespread cooperation among congressional leaders, product manufacturers, farmers, and public health organizations.

"This responsible legislation will greatly aid our farmers and will provide an influx of new and welcomed revenue into the state," Davis said. "Tobacco farmers throughout the district have told me Congress is taking a step in the right direction with this bill."

The compromise is a seven-year, $15.7 billion buyout, with Tennessee tobacco farmers receiving nearly $1.4 billion over that span. It is expected to generate almost $2.3 billion in economic activity in the state.

"This infusion of money and increased job growth into the local community will stimulate an increase in the standard of living for everyone. As a tobacco grower myself, I feel this legislation will go a long way in helping our tobacco farmers who have fallen on hard times," he said.

The proposal offers buyout payments based on an average of quota levels between 1997 and 2002. The plan would provide $8 per pound to quota owners and $4 per pound to growers who lease quota.

Instead of a traditional price support system, the bill incorporates a private price insurance system that will ensure that if the domestic price of tobacco falls below the world average, producers get a payment for the difference. This is a private insurance system paid for by a transaction fee assessed to both the producers and the manufacturers at the point of sale, thus it is not a federal price support system.

Davis is a member of the House Agriculture, Transportation & Infrastructure, and Science Committees.