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[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 1492 Introduced in Senate (IS)]

105th CONGRESS
  1st Session
                                S. 1492

 To amend the Public Health Service Act and the Federal Food, Drug and 
   Cosmetic Act to prevent the use of tobacco products by minors, to 
reduce the level of tobacco addiction, to compensate Federal and State 
   Governments for a portion of the health costs of tobacco-related 
 illnesses, to enhance the national investment in biomedical and basic 
  scientific research, and to expand programs to address the needs of 
                   children, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                            November 8, 1997

Mr. Kennedy (for himself, Mr. Lautenberg, Mr. Durbin, Mr. Reed, and Mr. 
Kerry) introduced the following bill; which was read twice and referred 
             to the Committee on Labor and Human Resources

_______________________________________________________________________

                                 A BILL

 
 To amend the Public Health Service Act and the Federal Food, Drug and 
   Cosmetic Act to prevent the use of tobacco products by minors, to 
reduce the level of tobacco addiction, to compensate Federal and State 
   Governments for a portion of the health costs of tobacco-related 
 illnesses, to enhance the national investment in biomedical and basic 
  scientific research, and to expand programs to address the needs of 
                   children, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Healthy and Smoke 
Free Children Act''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings and purposes.
   TITLE I--AMENDMENTS TO THE PUBLIC HEALTH SERVICE ACT RELATING TO 
                                TOBACCO

Sec. 101. Public health and education programs.
   ``TITLE XXVIII--PUBLIC HEALTH AND EDUCATION PROGRAMS AND TOBACCO 
                                CONTROL

        ``Sec. 2801. Definitions.
           ``Subtitle A--Public Health and Education Programs

        ``Sec. 2811. Payments to States.
        ``Sec. 2812. Public health programs.
        ``Sec. 2813. Biomedical research and child development 
                            investments.
        ``Sec. 2814. Tobacco victims compensation fund.
        ``Sec. 2815. Tobacco community transition assistance.
               ``Subtitle B--National Health Initiatives

        ``Part 1--National Basic and Child Development Research

        ``Sec. 2821. National Biomedical, Basic and Child Development 
                            Research Board.
        ``Sec. 2822. Grants for biomedical and basic research.
        ``Sec. 2823. Investments in healthy child development and 
                            research projects and training.
                    ``Part 2--Public Health Programs

        ``Sec. 2825. Research, counter-advertising, and CDC programs.
        ``Sec. 2826. National tobacco usage reduction and education 
                            block grant program.
            ``Subtitle C--Reduction in Underage Tobacco Use

        ``Sec. 2831. Purpose.
        ``Sec. 2832. Child tobacco use surveys.
        ``Sec. 2833. Reduction in underage tobacco product usage.
        ``Sec. 2834. Noncompliance.
        ``Sec. 2835. Use of amounts.
        ``Sec. 2836. Miscellaneous provisions.
                 ``Subtitle D--Miscellaneous Provisions

        ``Sec. 2841. Whistleblower protections.
        ``Sec. 2842. National Tobacco Document Depository.
        ``Sec. 2843. Tobacco Oversight and Compliance Board.
        ``Sec. 2844. Preservation of State and local authority.
        ``Sec. 2845. Regulations.
            TITLE II--FDA JURISDICTION OVER TOBACCO PRODUCTS

   Subtitle A--Amendments to the Federal Food, Drug and Cosmetic Act

Sec. 201. Reference.
Sec. 202. Statement of general authority.
Sec. 203. Treatment of tobacco products as drugs and devices.
Sec. 204. General health and safety regulation of tobacco products.
                     ``CHAPTER IX--TOBACCO PRODUCTS

        ``Sec. 901. Definitions.
        ``Sec. 902. Purpose.
        ``Sec. 903. Promulgation of regulations.
        ``Sec. 904. Minimum requirements.
        ``Sec. 905. Scientific Advisory Committee.
        ``Sec. 906. Requirements relating to nicotine and other 
                            constituents.
        ``Sec. 907. Reduced risk products.
        ``Sec. 908. Good manufacturing practice standards.
        ``Sec. 909. Disclosure and reporting of nontobacco ingredients 
                            and constituents.
        ``Sec. 910. Tobacco product warnings, labeling and packaging.
        ``Sec. 911. Statement of intended use.
        ``Sec. 912. Miscellaneous provisions.
  TITLE III--STANDARDS TO REDUCE INVOLUNTARY EXPOSURE TO TOBACCO SMOKE

Sec. 301. Standards to reduce involuntary exposure to tobacco smoke.
             TITLE IV--TOBACCO MARKET TRANSITION ASSISTANCE

Sec. 401. Definitions.
  Subtitle A--Tobacco Quota Buyout Contracts and Producer Transition 
                                Payments

Sec. 411. Quota owner buyout contracts.
Sec. 412. Producer transition payments for quota tobacco.
Sec. 413. Producer transition payments for non-quota tobacco.
Sec. 414. Elements of contracts.
                Subtitle B--No Net Cost Tobacco Program

Sec. 421. Budget deficit assessment.
         Subtitle C--Tobacco Community Empowerment Block Grants

Sec. 431. Tobacco community empowerment block grants.
                   TITLE V--MISCELLANEOUS PROVISIONS

Sec. 501. Sense of the Senate.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress makes the following findings:
            (1) Tobacco products are the foremost preventable health 
        problem facing America today. More than 400,000 individuals die 
        each year as a result of tobacco induced illnesses and 
        conditions.
            (2) Nicotine that is contained in tobacco products is 
        extremely addictive.
            (3) The tobacco industry has historically targeted tobacco 
        product marketing and promotional efforts towards minors in 
        order to entrap them into a lifetime of smoking.
            (4) Over 90 percent of individuals who smoke began smoking 
        regularly while they were still minors.
            (5) Approximately 3000 minors begin smoking each day. 1000 
        of these minors will die prematurely from a tobacco induced 
        illness or medical condition.
            (6) Tobacco induced illnesses and medical conditions 
        resulting from tobacco use cost the United States over 
        $100,000,000,000 each year.
            (7) Each year the Federal Government incurs costs in excess 
        of $20,000,000,000 for the medical treatment of individuals 
        suffering from tobacco induced illnesses and conditions.
    (b) Purposes.--It is the purpose of this Act to--
            (1) substantially reduce youth smoking;
            (2) assist individuals who are currently addicted to 
        tobacco products in overcoming that addiction;
            (3) educate the public concerning the health dangers 
        inherent in the use of tobacco products;
            (4) fund medical research; and
            (5) provide for the healthy development of young children 
        and to enhance their learning capacity and improve the quality 
        of their care.

   TITLE I--AMENDMENTS TO THE PUBLIC HEALTH SERVICE ACT RELATING TO 
                                TOBACCO

SEC. 101. PUBLIC HEALTH AND EDUCATION PROGRAMS.

    The Public Health Service Act (42 U.S.C. 201 et seq.) is amended by 
adding at the end thereof the following new title:

   ``TITLE XXVIII--PUBLIC HEALTH AND EDUCATION PROGRAMS AND TOBACCO 
                                CONTROL

``SEC. 2801. DEFINITIONS.

    ``In this title:
            ``(1) Brand.--The term `brand' means a variety of a tobacco 
        product distinguished by the tobacco used, tar content, 
        nicotine content, flavoring used, size, filtration, or 
        packaging.
            ``(2) Cigar.--The term `cigar' means any roll of tobacco 
        wrapped in leaf tobacco or in any substance containing tobacco 
        (other than any roll of tobacco which is a cigarette or 
        cigarillo within the meaning of paragraph (3) or (4)).
            ``(3) Cigarette.--The term `cigarette' means any product 
        which contains nicotine, is intended to be burned under 
        ordinary conditions of use, and consists of--
                    ``(A) any roll of tobacco wrapped in paper or in 
                any substance not containing tobacco; and
                    ``(B) any roll of tobacco wrapped in any substance 
                containing tobacco which, because of its appearance, 
                the type of tobacco used in the filler, or its 
                packaging and labeling, is likely to be offered to, or 
                purchased by, consumers as a cigarette described in 
                subparagraph (A).
            ``(4) Cigarillos.--The term `cigarillos' means any roll of 
        tobacco wrapped in leaf tobacco or any substance containing 
        tobacco (other than any roll of tobacco which is a cigarette 
        within the meaning of paragraph (3)) and as to which 1,000 
        units weigh not more than 3 pounds.
            ``(5) Cigarette tobacco.--The term `cigarette tobacco' 
        means any product that consists of loose tobacco that contains 
        or delivers nicotine and is intended for use by persons in a 
        cigarette. Unless otherwise stated, the requirements of this 
        title pertaining to cigarettes shall also apply to cigarette 
        tobacco.
            ``(6) Commerce.--The term `commerce' means--
                    ``(A) commerce between any State, the District of 
                Columbia, the Commonwealth of Puerto Rico, Guam, the 
                Virgin Islands, American Samoa, the Northern Mariana 
                Islands or any territory or possession of the United 
                States;
                    ``(B) commerce between points in any State, the 
                District of Columbia, the Commonwealth of Puerto Rico, 
                Guam, the Virgin Islands, American Samoa, the Northern 
                Mariana Islands or any territory or possession of the 
                United States; or
                    ``(C) commerce wholly within the District of 
                Columbia, Guam, the Virgin Islands, American Samoa, the 
                Northern Mariana Islands, or any territory or 
                possession of the United States.
            ``(7) Commissioner.--The term `Commissioner' means the 
        Commissioner of Food and Drugs.
            ``(8) Distributor.--The term `distributor' means any person 
        who furthers the distribution of tobacco products, whether 
        domestic or imported, at any point from the original place of 
        manufacture to the person who sells or distributes the product 
        to individuals for personal consumption. Such term shall not 
        include common carriers.
            ``(9) Little cigar.--The term `little cigar' means any roll 
        of tobacco wrapped in leaf tobacco or any substance containing 
        tobacco (other than any roll of tobacco which is a cigarette 
        within the meaning of subsection (1)) and as to which 1,000 
        units weigh not more than 3 pounds.
            ``(10) Manufacturer.--The term `manufacturer' means any 
        person, including any repacker or relabeler, who manufactures, 
        fabricates, assembles, processes, or labels a finished tobacco 
        product.
            ``(11) Nicotine.--The term `nicotine' means the chemical 
        substance named 3-(1-Methyl-2-pyrrolidinyl)pyridine or 
        C<INF>10</INF>H<INF>14</INF>N<INF>2</INF>, including any salt 
        or complex of nicotine.
            ``(12) Package.--The term `package' means a pack, box, 
        carton, or container of any kind in which tobacco products are 
offered for sale, sold, or otherwise distributed to consumers.
            ``(13) Person.--The term `person' means an individual, 
        partnership, corporation, or any other business or legal 
        entity.
            ``(14) Pipe tobacco.--The term `pipe tobacco' means any 
        loose tobacco that, because of its appearance, type, packaging, 
        or labeling, is likely to be offered to, or purchased by, 
        consumers as a tobacco product to be smoked in a pipe.
            ``(15) Point of sale.--The term `point of sale' means any 
        location at which an individual can purchase or otherwise 
        obtain tobacco products for personal consumption.
            ``(16) Retailer.--The term `retailer' means any person who 
        sells tobacco products to individuals for personal consumption, 
        or who operates a facility where vending machines or self-
        service displays are permitted under this title.
            ``(17) Roll-your-own tobacco.--The term `roll-your-own 
        tobacco'' has the meaning given such term by section 5702(p) of 
        the Internal Revenue Code of 1986.
            ``(18) Sale.--The term `sale' includes the selling, 
        providing samples of, or otherwise making tobacco products 
        available for personal consumption in any place within the 
        scope of this title.
            ``(19) Secretary.--The term `Secretary' means the Secretary 
        of Health and Human Services.
            ``(20) Smokeless tobacco.--The term `smokeless tobacco' 
        means any product that consists of cut, ground, powdered, or 
        leaf tobacco that contains nicotine and that is intended to be 
        placed in the oral or nasal cavity.
            ``(21) State.--The term `State' includes the several 
        States, the District of Columbia, the Commonwealth of Puerto 
        Rico, Guam, the Virgin Islands, American Samoa, the Northern 
        Mariana Islands, and any other territory or possession of the 
        United States. Such term includes any political division of any 
        State.
            ``(22) Tobacco.--The term `tobacco' means tobacco in its 
        unmanufactured form.
            ``(23) Tobacco product.--The term `tobacco product' means 
        cigarettes, cigarillos, cigarette tobacco, little cigars, pipe 
        tobacco, and smokeless tobacco, and roll-your-own tobacco.

           ``Subtitle A--Public Health and Education Programs

``SEC. 2811. PAYMENTS TO STATES.

    ``(a) Funds.--
            ``(1) In general.--Subject to subsection (d), there are 
        hereby made available to carry out this section for each fiscal 
        year an amount equal to the amount necessary to reimburse 
        States as provided for in subsection (b).
            ``(2) Fiscal year limitation.--Amounts made available for a 
        fiscal year under paragraph (1) shall be equal to--
                    ``(A) 43 percent of the net increase in revenues 
                received in the Treasury for such fiscal year 
                attributable to any amendments made to chapter 52 of 
                the Internal Revenue Code of 1986 in the fiscal year in 
                which this title is enacted, as estimated by the 
                Secretary; less
                    ``(B) amounts made available for such fiscal year 
                under sections 2812 and 2814.
    ``(b) Reimbursement.--
            ``(1) In general.--The Secretary shall use amounts made 
        available under subsection (a) in each fiscal year to provide 
        funds to each State to reimburse such State for amounts 
        expended by the State for the treatment of individuals with 
        tobacco-related illnesses or conditions, and to permit States 
        to utilize the Federal share of such expended amounts to 
        provide services for children.
            ``(2) Amount.--The amount for which a State is eligible for 
        under paragraph (1) shall be based on the ratio of the 
        expenditures of the State under title XIX of the Social 
        Security Act (42 U.S.C. 1396 et seq.) for fiscal year 1996 to 
        the expenditures by all States under such title for such fiscal 
        year.
            ``(3) Adjustment.--With respect to a fiscal year in which 
        the amount determined under subsection (a)(1) exceeds the 
        limitation under subsection (a)(2), the Secretary shall make 
        pro rata reductions in the amounts provided to States under 
        this subsection.
    ``(c) Use of Funds.--
            ``(1) Determination.--With respect to each State, the 
        Secretary shall determine the proportion of the reimbursement 
        under subsection (b) for each fiscal year that is equal to the 
        amount that has been paid to the State as the Federal medical 
        assistance percentage (as defined in section 1905(b)) of the 
        Social Security Act (42 U.S.C. 1396d(b)) expenditures by the 
        State for the preceding fiscal year.
            ``(2) Required use.--With respect to the amount determined 
        under paragraph (1) for a State for a fiscal year, the 
        Secretary shall not treat such amount as an overpayment under 
        any joint Federal-State health program if the State certifies 
        to the Secretary that such amount will be used by the State to 
        serve the needs of children in the State under 1 or more of the 
        following programs:
                    ``(A) An Even Start program under section of the 
                Head Start Act (42 U.S.C. 9801 et seq.).
                    ``(B) The Head Start program under the Head Start 
                Act (42 U.S.C. 9801 et seq.).
                    ``(C) A child care program under the Child Care and 
                Development Block Grant Act of 1990 (42 U.S.C. 658A et 
                seq.).
                    ``(D) The Individuals with Disabilities Education 
                Act.
                    ``(E) The child care food program and start-up and 
                expansion funds for school break programs and summer 
                food programs under section 17 of the National School 
                Lunch Act (42 U.S.C. 1766).
                    ``(F) The special supplemental food program under 
                section 17 of the Child Nutrition Act of 1966 (42 
                U.S.C. 1786).
                    ``(G) The Maternal and Child Health Services Block 
                Grant program under title V of the Social Security Act 
                (42 U.S.C. 701 et seq.).
                    ``(H) The State Children's Health Insurance Program 
                of the State under title XXI of the Social Security Act 
                (42 U.S.C. 1397aa et seq.).
                    ``(I) The family preservation and support services 
                program under section 430B of the Social Security Act.
                    ``(J) State initiated programs that are designed to 
                serve the health and developmental needs of children 
                and are approved by the Secretary.
            ``(3) Coordination.--A State may use not to exceed 20 
        percent of the amount determined under paragraph (1) for the 
        State for a fiscal year to--
                    ``(A) improve linkages and coordination among 
                programs serving children and families, including the 
                provision of funds to outpost outreach workers into 
                Federally funded early childhood programs to ensure 
                effective enrollment in child health initiatives 
                referred to in paragraph (2)(H);
                    ``(B) fund local collaboratives which shall be 
                required to use such funds on needs assessments, 
                planning, and investments to maximize efforts to 
                improve child development; and
                    ``(C) fund innovative demonstrations that address 
                the outstanding needs of children and families as 
                assessed by State and local entities.
            ``(4) State plan.--To be eligible to receive funds under 
        this subsection a State shall prepare and submit to the 
        Secretary a State plan, at such time, in such manner, and 
        containing such information as the Secretary may require, 
        including a description of the manner in which the State will 
        use amounts provided under this subsection. Such plan shall 
        demonstrate, based on standards established by the Secretary, 
        that the State will comply with paragraph (6).
            ``(5) Application of requirements.--The requirements of the 
        respective provisions of law described in paragraph (2) shall 
        apply to any funds made available under this subsection through 
        State programs under any such provision of law to the same 
        extent that such requirements would otherwise apply to such 
        programs under such provisions of law.
            ``(6) Supplement not supplant.--Amounts provided to a State 
        under this subsection shall be used to supplement and not 
        supplant other Federal, State and local funds provided for 
        programs that serve the health and developmental needs of 
        children. Amounts provided to the State under any of the 
        provisions of law referred to in paragraph (2) shall not be 
        reduced solely as a result of the availability of funds under 
        this section.
            ``(7) Overpayments.--Any amount of the reimbursement of a 
        State under paragraph (1) to which paragraph (2) applies that 
        is not used in accordance with this subsection shall be treated 
        by the Secretary as an overpayment under section 1903 of the 
        Social Security Act (42 U.S.C. 1396b). Any such overpayments 
        may be allotted among other States under this subsection in 
        proportion to the amount that the State originally received 
        under this section.

``SEC. 2812. PUBLIC HEALTH PROGRAMS.

    ``(a) Funding.--There are hereby made available to carry out this 
section--
            ``(1) for fiscal year 1998, $2,100,000,000;
            ``(2) for fiscal year 1999, $2,175,000,000 increased by an 
        amount equal to the increase in the Consumer Price Index for 
        the previous fiscal year for all urban consumers (all items; 
U.S. city average);
            ``(3) for fiscal year 2000, $2,200,000,000 increased by an 
        amount equal to the increase in the Consumer Price Index for 
        the 2 previous fiscal years for all urban consumers (all items; 
        U.S. city average);
            ``(4) for fiscal year 2001, $2,325,000,000 increased by an 
        amount equal to the increase in the Consumer Price Index for 
        the 3 previous fiscal years for all urban consumers (all items; 
        U.S. city average); and
            ``(5) for fiscal year 2002 and subsequent fiscal years, the 
        amount made available for fiscal year 2001 increased by an 
        amount equal to the increase in the Consumer Price Index for 
        the period encompassing the fiscal years from 1998 to the 
        fiscal year prior to the fiscal year involved for all urban 
        consumers (all items; U.S. city average).
    ``(b) Use of Funds.--Amounts made available for a fiscal year under 
subsection (a) shall be distributed in the following manner:
            ``(1) Use reduction and addiction prevention research.--
                    ``(A) In general.--The amount described in 
                subparagraph (B) shall be used by Secretary to carry 
                out Federal tobacco use reduction and addiction 
                prevention research under section 2825(a).
                    ``(B) Amount.--The amount described in this 
                subparagraph is--
                            ``(i) for fiscal year 1998, $100,000,000; 
                        and
                            ``(ii) for fiscal year 1999 and each 
                        subsequent fiscal year, the amount described in 
                        clause (i), increased for each such fiscal year 
                        by an amount equal to the increase in the 
                        Consumer Price Index for the period 
                        encompassing the fiscal years from 1998 to the 
                        fiscal year prior to the fiscal year involved 
                        for all urban consumers (all items; U.S. city 
                        average).
            ``(2) Counter-advertising.--
                    ``(A) In general.--The amount described in 
                subparagraph (B) shall be used by Secretary to carry 
                out the Federal tobacco product counter-advertising 
                campaign under section 2825(b).
                    ``(B) Amount.--The amount described in this 
                subparagraph is--
                            ``(i) for fiscal year 1998, $500,000,000; 
                        and
                            ``(ii) for fiscal year 1999 and each 
                        subsequent fiscal year, the amount described in 
                        clause (i), increased for each such fiscal year 
                        by an amount equal to the increase in the 
                        Consumer Price Index for the period 
                        encompassing the fiscal years from 1998 to the 
                        fiscal year prior to the fiscal year involved 
                        for all urban consumers (all items; U.S. city 
                        average).
            ``(3) Centers for disease control and prevention 
        programs.--
                    ``(A) In general.--The amount described in 
                subparagraph (B) shall be used by Secretary, acting 
                through the Centers for Disease Control and Prevention, 
                to carry programs to discourage the initiation of 
                tobacco use, reduce the incidence of tobacco use among 
                current users, and for other activities designed to 
                reduce the risk of dependence and injury from tobacco 
                products under section 2825(c).
                    ``(B) Amount.--The amount described in this 
                subparagraph is--
                            ``(i) for fiscal year 1998, $60,000,000;
                            ``(ii) for each of the fiscal years 1998 
                        and 2000, $60,000,000, increased for each such 
                        fiscal year by an amount equal to the increase 
                        in the Consumer Price Index for the period 
                        encompassing the fiscal years from 1998 to the 
                        fiscal year prior to the fiscal year involved 
                        for all urban consumers (all items; U.S. city 
                        average);
                            ``(iii) for fiscal year 2001, $100,000,000, 
                        increased for such fiscal year by an amount 
                        equal to the increase in the Consumer Price 
                        Index for fiscal years 1998 through 2000 for 
                        all urban consumers (all items; U.S. city 
                        average); and
                            ``(iv) for fiscal year 2002 and subsequent 
                        fiscal years, the amount described in clause 
                        (iii), increased for each such fiscal year by 
                        an amount equal to the increase in the Consumer 
                        Price Index for the period encompassing the 
                        fiscal years from 1998 to the fiscal year prior 
                        to the fiscal year involved for all urban 
consumers (all items; U.S. city average).
            ``(4) Food and drug administration.--
                    ``(A) In general.--The amount described in 
                subparagraph (B) shall be used by Secretary to assist 
                in defraying the costs associated with the activities 
                of the Food and Drug Administration relating to 
                tobacco.
                    ``(B) Amount.--The amount described in this 
                subparagraph is--
                            ``(i) for fiscal year 1998, $300,000,000; 
                        and
                            ``(ii) for fiscal year 1999 and each 
                        subsequent fiscal year, the amount described in 
                        clause (i), increased for each such fiscal year 
                        by an amount equal to the increase in the 
                        Consumer Price Index for the period 
                        encompassing the fiscal years from 1998 to the 
                        fiscal year prior to the fiscal year involved 
                        for all urban consumers (all items; U.S. city 
                        average).
            ``(5) State block grants.--
                    ``(A) In general.--The amount described in 
                subparagraph (B) shall be used by Secretary to make 
                block grants to States under the National Tobacco Usage 
                Reduction and Education Block Grant Program under 
                section 2826.
                    ``(B) Amount.--The amount described in this 
                subparagraph is--
                            ``(i) for fiscal year 1998, $1,144,000,000;
                            ``(ii) for fiscal year 1999, 
                        $1,215,000,000, increased for such fiscal year 
                        by an amount equal to the increase in the 
                        Consumer Price Index for the previous fiscal 
                        year for all urban consumers (all items; U.S. 
                        city average);
                            ``(iii) for fiscal year 2000, 
                        $1,240,000,000, increased for such fiscal year 
                        by an amount equal to the increase in the 
                        Consumer Price Index for fiscal years 1998 
                        through 2000 for all urban consumers (all 
                        items; U.S. city average);
                            ``(iv) for fiscal year 2001, 
                        $1,325,000,000, increased for such fiscal year 
                        by an amount equal to the increase in the 
                        Consumer Price Index for fiscal years 1998 
                        through 2000 for all urban consumers (all 
                        items; U.S. city average);
                            ``(v) for each of the fiscal years 2002 
                        through 2008, $1,825,000,000, increased for 
                        each such fiscal year by an amount equal to the 
                        increase in the Consumer Price Index for the 
                        period encompassing the fiscal years from 1998 
                        to the fiscal year prior to the fiscal year 
                        involved for all urban consumers (all items; 
                        U.S. city average); and
                            ``(vi) for fiscal year 2009 and subsequent 
                        fiscal years, $1,750,000,000, increased for 
                        each such fiscal year by an amount equal to the 
                        increase in the Consumer Price Index for fiscal 
                        years 1998 through the fiscal year previous to 
                        the fiscal year for which the determination is 
                        being made for all urban consumers (all items; 
                        U.S. city average).

``SEC. 2813. BIOMEDICAL RESEARCH AND CHILD DEVELOPMENT INVESTMENTS.

    ``(a) Funding.--There are hereby made available to carry out this 
section for each fiscal year an amount equal to 57 percent of the net 
increase in revenues received in the Treasury for such fiscal year 
attributable to any amendments made to chapter 52 of the Internal 
Revenue Code of 1986 in the fiscal year in which this title is enacted, 
as estimated by the Secretary.
    ``(b) Use of Funds.--Amounts made available for a fiscal year under 
subsection (a) shall be used to carry out national biomedical and basic 
scientific research activities and child development and research 
activities under part 1 of subtitle C.

``SEC. 2814. TOBACCO VICTIMS COMPENSATION FUND.

    ``(a) Funding.--There are hereby made available to carry out this 
section for each fiscal year an amount equal to 14.2 percent of the net 
increase in revenues received in the Treasury for such fiscal year 
attributable to any amendments made to chapter 52 of the Internal 
Revenue Code of 1986 in the fiscal year in which this title is enacted, 
as estimated by the Secretary.
    ``(b) Use of Funds.--Amounts made available for a fiscal year under 
subsection (a) shall be used to provide assistance and compensation to 
individuals suffering from tobacco-related illnesses and conditions, 
under a plan to be developed by the Secretary, not later than 1 year 
after the date of enactment of this Act, and submitted to Congress for 
approval.

``SEC. 2815. TOBACCO COMMUNITY TRANSITION ASSISTANCE.

    ``(a) Funding.--There are hereby made available to carry out this 
section--
            ``(1) for buyouts of quotas under section 411--
                    ``(A) $3,100,000,000 for each of the fiscal years 
                1998 and 1999; and
                    ``(B) $3,000,000,000 for fiscal 2000; and
            ``(2) for block grants under section 431--
                    ``(A) $500,000,000 for each of the fiscal years 
                1998 and 1999;
                    ``(B) $800,000,000 for each of the fiscal years 
                2000 through 2002; and
                    ``(C) $400,000,000 for fiscal year 2003.
    ``(b) Use of Funds.--Amounts made available for a fiscal year under 
subsection (a) shall remain available until expended (except that with 
respect to amounts under subsection (a)(1), such amounts shall only be 
available until September 30, 2001) and shall be used to provide 
tobacco transition assistance under title IV of the Healthy and Smoke 
Free Children Act.

               ``Subtitle B--National Health Initiatives

        ``PART 1--NATIONAL BASIC AND CHILD DEVELOPMENT RESEARCH

``SEC. 2821. NATIONAL BIOMEDICAL, BASIC AND CHILD DEVELOPMENT RESEARCH 
              BOARD.

    ``(a) Establishment.--There is established a Federal board to be 
known as the `National Biomedical and Basic Scientific Research Board' 
(referred to in this subpart as the `Board').
    ``(b) Membership.--
            ``(1) Composition.--The board shall be composed of--
                    ``(A) 9 voting members to be appointed by the 
                President from among individuals with expertise in 
                biomedical research, basic research, child development, 
                and medicine; and
                    ``(B) 3 ex officio (nonvoting) members of which--
                            ``(i) 1 shall be the Secretary;
                            ``(ii) 1 shall be the Secretary of 
                        Education; and
                            ``(iii) 1 shall be the Assistant to the 
                        President for Science and Technology.
            ``(2) Terms.--A member of the Board under paragraph (1)(A) 
        shall be appointed for a term of 6 years, except that of the 
        members first appointed--
                    ``(A) 3 members shall be appointed for terms of 6 
                years;
                    ``(B) 3 members shall be appointed for terms of 4 
                years; and
                    ``(C) 3 members shall be appointed for terms of 2 
                years.
            ``(3) Vacancies.--
                    ``(A) In general.--A vacancy on the Board shall be 
                filled in the same manner in which the original 
                appointment was made and shall be subject to any 
                conditions which applied with respect to the original 
                appointment.
                    ``(B) Filling unexpired term.--An individual 
                appointed to fill a vacancy on the Board shall be 
                appointed for the unexpired term of the member 
                replaced.
                    ``(C) Expiration of terms.--The term of any member 
                of the Board shall not expire before the date on which 
                the member's successor takes office.
    ``(c) Chairperson.--The President shall designate a member of the 
Board appointed under subsection (b)(1)(A) as the Chairperson of the 
Board.
    ``(d) Meetings and Quorum.--
            ``(1) In general.--The Commission shall meet at the call of 
        the Chairperson.
            ``(2) Initial meeting.--Not later than 30 days after the 
        date on which all members of the Board have been appointed, the 
        Board shall hold its first meeting.
            ``(3) Quorum.--A majority of the members of the Board 
        appointed under subsection (b)(1)(A) shall constitute a quorum, 
        but a lesser number of members may hold hearings.
    ``(e) Personnel Matters.--
            ``(1) Compensation.--Each member of the Board who is not an 
        officer or employee of the Federal Government shall be 
        compensated at a rate equal to the daily equivalent of the 
        annual rate of basic pay prescribed for level IV of the 
        Executive Schedule under section 5315 of title 5, United States 
        Code, for each day (including travel time) during which such 
        member is engaged in the performance of the duties of the 
        Board. All members of the Board who are officers or employees 
        of the United States shall serve without compensation in 
addition to that received for their services as officers or employees 
of the United States.
            ``(2) Travel expenses.--The members of the Board shall be 
        allowed travel expenses, including per diem in lieu of 
        subsistence, at rates authorized for employees of agencies 
        under subchapter I of chapter 57 of title 5, United States 
        Code, while away from their homes or regular places of business 
        in the performance of services for the Board.
            ``(3) Staff.--
                    ``(A) In general.--The Chairperson of the Board 
                may, without regard to the civil service laws and 
                regulations, appoint and terminate an executive 
                director and such other additional personnel as may be 
                necessary to enable the Board to perform its duties. 
                The employment of an executive director shall be 
                subject to confirmation by the Board.
                    ``(B) Compensation.--The Chairperson of the Board 
                may fix the compensation of the executive director and 
                other personnel without regard to the provisions of 
                chapter 51 and subchapter III of chapter 53 of title 5, 
                United States Code, relating to classification of 
                positions and General Schedule pay rates, except that 
                the rate of pay for the executive director and other 
                personnel may not exceed the rate payable for level V 
                of the Executive Schedule under section 5316 of such 
                title.
            ``(4) Detail of government employees.--Any Federal 
        Government employee may be detailed to the Board without 
        reimbursement, and such detail shall be without interruption or 
        loss of civil service status or privilege.
            ``(5) Procurement of temporary and intermittent services.--
        The Chairperson of the Board may procure temporary and 
        intermittent services under section 3109(b) of title 5, United 
        States Code, at rates for individuals which do not exceed the 
        daily equivalent of the annual rate of basic pay prescribed for 
        level V of the Executive Schedule under section 5316 of such 
        title.
    ``(f) Powers.--The Board shall award grants to, and enter into 
contracts with eligible entities under section 2822 for the expansion 
of basic and biomedical research and to provide graduate training with 
respect to such research.
    ``(g) Delegation.--The Board may delegate all or a portion of grant 
making authority under subsection (f) to the Secretary, the Secretary 
of Education, the Director of the National Science Foundation, or the 
head of any other Federal agency determined appropriate by the Board.
    ``(h) Availability of Funds.--
            ``(1) In general.--With respect to a fiscal year, no funds 
        shall be made available under this part for such fiscal year 
        until the Secretary certifies that the amounts appropriated for 
        each of the entities or activities described in subparagraphs 
        (A) and (B) of section 2822(a)(1) or subparagraphs (A), (B) and 
        (F) of section 2823(a)(1) for such fiscal year has increased as 
        compared to the amounts appropriated for the previous fiscal 
        year--
                    ``(A) by not less than the percentage increase in 
                the consumer price index, as determined by the 
                Secretary of Labor; or
                    ``(B) by an amount equal to the percentage increase 
                in the level of overall discretionary spending for such 
                fiscal year as compared to the previous fiscal year;
        whichever is greater.
            ``(2) Application to child development activities.--With 
        respect to a fiscal year, no funds shall be made available 
        under this part for such fiscal year until the Secretary 
        certifies that the amounts appropriated for each of the 
        entities or activities described in section 2823(a)(1)(F) for 
        such fiscal has increased as compared to the amounts 
        appropriated for the previous fiscal year--
                    ``(A) by not less than the percentage increase in 
                the consumer price index, as determined by the 
                Secretary of Labor; or
                    ``(B) by an amount equal to the percentage increase 
                in the level of overall discretionary spending for such 
                fiscal year as compared to the previous fiscal year;
        whichever is less.
            ``(3) Supplement not Supplant.--Funds made available for 
        use under this part shall be used to supplement and not 
        supplant other funds appropriated to the entities described in 
        section 2822(a) and 2823(a). Amounts appropriated to such 
        entities under other provisions of law shall not be reduced 
        solely as a result of the availability of funds under this 
        section.

``SEC. 2822. GRANTS FOR BIOMEDICAL AND BASIC RESEARCH.

    ``(a) Eligible Entities.--To be eligible to receive a grant or 
contract under section 2821(f) an entity shall be--
            ``(1) the National Institutes of Health (including a 
        subdivision or grantee of such Institutes);
            ``(2) the National Science Foundation (including a 
        subdivision or grantee of such Foundation);
            ``(3) nationally recognized research hospitals;
            ``(4) universities with recognized programs of basic and 
        biomedical research;
            ``(5) research institutes with expertise in the conduct of 
        basic or biomedical research;
            ``(6) cancer research centers that meet the standards of 
        section 414; and
            ``(7) entities conducting quality basic or biomedical 
        research as determined by the Board.
    ``(b) Graduate Training.--Support may be provided under section 
2821(f) for graduate training, including the following:
            ``(1) Grants for portable fellowships as defined for 
        purposes of the National Science Foundation Act of 1950 (42 
        U.S.C. 1861 et seq.).
            ``(2) Grants to support an additional year of portable 
        fellowship training to enhance the teaching capabilities of 
        fellows seeking careers in academic teaching settings.
            ``(3) Programs of student loan forgiveness for students in 
        the sciences and biomedical sciences who pursue careers as 
        teachers of science or biomedical science or researchers in 
        such fields in nonprofit institutions. Loans may be forgiven 
        under this paragraph at the rate of--
                    ``(A) 15 percent per year for the first and second 
                fiscal years after the date of enactment of this title;
                    ``(B) 20 percent per year for the third and fourth 
                fiscal years after the date of enactment of this title; 
                and
                    ``(C) 30 percent per year for the fifth fiscal year 
                after the date of enactment of this title.
            ``(4) Programs of postdoctoral fellowships for individuals 
        qualifying for such fellowships under the authority of the 
        National Science Foundation of National Institutes of Health.
            ``(5) Programs of grants to universities and other research 
        facilities to assist in the equipping of laboratories for new 
        researchers of exceptional promise during the first 5 years of 
        post-doctoral research.
            ``(6) Such other programs of grants and contracts as the 
        Board determines will contribute to increasing the supply of 
        high quality scientific and biomedical researchers.
    ``(c) Funding.--The Board shall use 50 percent of the amount made 
available for a fiscal year under section 2813 to carry out this 
subpart in such fiscal year.

``SEC. 2823. INVESTMENTS IN HEALTHY CHILD DEVELOPMENT AND RESEARCH 
              PROJECTS AND TRAINING.

    ``(a) Children's Research, Training and Demonstration Projects.--
            ``(1) In general.--The Secretary shall use not to exceed 10 
        percent of the funds allocated for use under this section to 
        award grants of contracts for the conduct and support of 
        research, training and demonstration projects relating to child 
        health and development.
            ``(2) Entities eligible for research projects.--To be 
        eligible to receive a grant or contract under paragraph (1) for 
        the conduct or support of research an entity shall be--
                    ``(A) the National Institutes of Health (including 
                a subdivision or grantee of such Institutes);
                    ``(B) the National Science Foundation (including a 
                subdivision or grantee of the Foundation);
                    ``(C) a nationally recognized research hospital;
                    ``(D) a university with a recognized program of 
                research or training on children's development and 
                health and childhood disabilities; and
                    ``(E) entities conducting child development 
                research and training; and
                    ``(F) a public or private nonprofit organization, 
                agency, or partnership with the capacity to implement 
                research findings on brain development in the early 
                years of life and for the support of continual 
                physical, intellectual, and social development of young 
                children, including infants and toddlers with 
                disabilities.
            ``(3) Training projects.--Support may be provided under 
        subparagraphs (D), (E) and (F) of paragraph (1) for training, 
        including programs to support undergraduate and graduate 
        training programs to expand the early childhood development 
        workforce by recruiting; training students for careers in early 
        childhood development and care, which may include grants to 
institutions, scholarships, and programs of loan work forgiveness; and 
preservice and inservice training programs to enhance the quality of 
the existing child care workforce.
            ``(4) Demonstration projects.--Support may be provided 
        under subparagraphs (D), (E) and (F) of paragraph (1) for 
        demonstration projects including public-private partnerships 
        for paid leave to enable mothers with infants to choose to stay 
        at home.
            ``(5) Evaluations.--Each project under this subsection 
        shall include an evaluation component to assess the 
        effectiveness of the project in achieving its goals.
    ``(b) Child Development Projects.--
            ``(1) In general.--The Secretary shall use not less than 90 
        percent of the funds allocated for use under this section as 
        follows:
                    ``(A) Investments for early childhood 
                development.--60 percent of such funds will be used for 
                investments in early childhood development as follows:
                            ``(i) 10 percent to expand the Early Head 
                        Start program under section 645A of the Head 
                        Start Act (42 U.S.C. 9841).
                            ``(ii) 20 percent to the Child Care and 
                        Development Block Grant Act of 1990 (42 U.S.C. 
                        658A et seq.) to provide certificates and 
                        grants to increase the availability and 
                        affordability of quality child care for 
                        children of working families from birth through 
                        school age, including children with 
                        disabilities.
                            ``(iii) 25 percent to expand the Head Start 
                        program under the Head Start Act (42 U.S.C. 
                        9801) to increase enrollment and responsiveness 
                        of such program.
                            ``(iv) 5 percent to early childhood 
                        development programs under part C and section 
                        619 of the Individuals with Disabilities 
                        Education Act.
                Not less than 30 percent of amounts made available 
                under clause (ii) shall be set-aside for innovative 
                programs for babies and toddlers, including the 
                development of family child care networks, start-up for 
                infant care programs, the training of providers, or the 
                provision of parent education and support.
                    ``(B) Improvement of the quality of child care.--20 
                percent to establish a health and safety fund through 
                the Child Care and Development Block Grant Act of 1990 
                (42 U.S.C. 658A et seq.), 50 percent of which shall be 
                used to provide incentives to reward States that 
                improve the quality of child care programs in the State 
                by adopting the essential components of the child care 
                program of the armed services or the essential 
                components of other proven child care models. Such 
                components include the provision of training linked to 
                increased wages, improved standards and enforcement, 
                lower child to staff ratios, higher rates for 
                accredited programs, and consumer education including 
                resources referral services.
                    ``(C) Programs to promote healthy behavior.--20 
                percent to the Child Care and Development Block Grant 
                Act of 1990 (42 U.S.C. 658A et seq.) to expand the 
                availability and affordability of quality before- and 
                after-school care, and summer and weekend activities 
                for school age (through 15 years of age) children, 
                including children with disabilities, to promote good 
                health and academic achievement and to help in avoiding 
                high risk behaviors. Eligible entities for grants under 
                this clause shall include elementary and secondary 
                schools, community-based organizations, child care 
                centers, family child care homes, youth centers, or 
                partnerships and should be targeted to communities with 
                high rates of poverty or at-risk children.
    ``(c) Supplement not Supplant.--Amounts provided to a State under 
this section shall be used to supplement and not supplant other 
Federal, State and local funds provided for programs that serve the 
health and developmental needs of children. Amounts provided to the 
State under any of the provisions of law referred to in this section 
shall not be reduced solely as a result of the availability of funds 
under this section.
    ``(d) Funding.--The Board shall use 50 percent of the amount made 
available for a fiscal year under section 2813 to carry out this 
subpart in such fiscal year.

                    ``PART 2--PUBLIC HEALTH PROGRAMS

``SEC. 2825. RESEARCH, COUNTER-ADVERTISING, AND CDC PROGRAMS.

    ``(a) Reduction and Addiction Prevention Research.--The Secretary 
shall provide for the conduct of research concerning the development of 
methods, drugs, and devices to discourage individuals from using 
tobacco products and to assist individuals who use such products in 
quitting such use.
    ``(b) Counter-Advertising.--The Secretary shall carry out programs 
to reduce tobacco usage through media-based (such as counter-
advertising campaigns) and nonmedia-based education, prevention and 
cessation campaigns designed to discourage the use of tobacco products 
by individuals and to encourage those who use such products to quit.
    ``(c) Centers for Disease Control and Prevention Programs.--The 
Secretary, acting through the Centers for Disease Control and 
Prevention, shall carry programs to discourage the initiation of 
tobacco use, reduce the incidence of tobacco use among current users, 
and for other activities designed to reduce the risk of dependence and 
injury from tobacco products.
    ``(d) Funding.--
            ``(1) Research.--The Secretary shall use amounts available 
        under section 2812(b)(1) to carry out subsection (a).
            ``(2) Counter-Advertising.--The Secretary shall use amounts 
        available under section 2812(b)(2) to carry out subsection (b).
            ``(3) CDC programs.--The Secretary shall use amounts 
        available under section 2812(b)(3) to carry out subsection (c).

``SEC. 2826. NATIONAL TOBACCO USAGE REDUCTION AND EDUCATION BLOCK GRANT 
              PROGRAM.

    ``(a) Block Grants.--The Secretary shall award block grants to 
States to enable such States to carry out activities for the purpose of 
planning, carrying out, and evaluating tobacco use reduction and 
education activities described in subsection (c).
    ``(b) Application.--
            ``(1) In general.--A State that desires to receive a grant 
        under subsection (a) shall prepare and submit to the Secretary 
        an application, at such time, in such manner, and accompanied 
        by such information as the Secretary may require.
            ``(2) Contents.--An application submitted under paragraph 
        (1) shall--
                    ``(A) describe the activities that will be carried 
                out using assistance under this section; and
                    ``(B) provide such assurances as the Secretary 
                determines to be necessary to carry out this section.
    ``(c) Use of Funds.--A State shall use amounts received under this 
section to carry out the following activities:
            ``(1) Tobacco use cessation.--
                    ``(A) In general.--Activities to assist individuals 
                in quitting the use of cigarettes or other tobacco 
                products.
                    ``(B) Model state program.--The Secretary shall 
                establish a model smoking cessation program that may be 
                used by States in the design of State-based smoking 
                cessation programs. Such model program shall provide 
                for the provision of grants and other assistance by 
                such States to eligible entities and individuals in the 
                State for the establishment or administration of 
                tobacco product use cessation programs that are 
                approved in accordance with subparagraph (D).
                    ``(C) Use of assistance.--Under a State smoking 
                cessation program under this paragraph an entity that 
                receives assistance shall use such amounts to establish 
                or administer tobacco product use cessation programs 
                that are approved in accordance with subparagraph (D).
                    ``(D) Approval of cessation program or devices.--
                Using the best available scientific information, the 
                Secretary shall promulgate regulations to provide for 
                the approval of tobacco product use cessation programs 
                and devices. Such regulations shall be designed to 
                ensure that tobacco product users, if requested, are 
                provided with reasonable access to safe and effective 
                cessation programs and devices. Such regulations shall 
                ensure that such individuals have access to a broad 
                range of cessation options that are tailored to the 
                needs of the individual tobacco user.
            ``(2) Tobacco usage reduction and education program.--
        Activities--
                    ``(A) to reduce tobacco usage through media-based 
                (such as counter-advertising campaigns) and nonmedia-
                based education, prevention and cessation campaigns 
                designed to discourage the use of tobacco products by 
                individuals who are under 18 years of age and to 
                encourage those who use such products to quit;
                    ``(B) to carry out informational campaigns that are 
                designed to discourage and de-glamorize the use of 
                tobacco products;
                    ``(C) for tobacco use reduction in elementary and 
                secondary schools; or
                    ``(D) for community-based tobacco control efforts 
                that are designed to encourage community involvement in 
                reducing tobacco product use.
            ``(3) Event transitional sponsorship program.--
                    ``(A) In general.--Activities for the transitional 
                sponsorship of certain activities, including grants 
                to--
                            ``(i)(I) pay the costs associated with the 
                        transitional sponsorship of an event or 
                        activity;
                            ``(II) provide for the transitional 
                        sponsorship of an individual or team;
                            ``(III) pay the required entry fees 
                        associated with the participation of an 
                        individual or team in an event or activity;
                            ``(IV) provide financial or technical 
                        support to an individual or team in connection 
                        with the participation of that individual or 
                        team in an activity described in subparagraph 
                        (C)(iii); or
                            ``(V) for any other purposes determined 
                        appropriate by the State; and
                            ``(ii) promote images or activities to 
                        discourage individuals from using 
tobacco products or encourage individuals who use such products to 
quit.
                    ``(B) Eligibility.--A State program funded under 
                this paragraph shall ensure that to be eligible to 
                receive assistance under this paragraph an entity or 
                individual shall prepare and submit to the State an 
                application at such time, in such manner, and 
                containing such information as the State may require, 
                including--
                            ``(i) a description of the event, activity, 
                        team, or entry for which the grant is to be 
                        provided;
                            ``(ii) documentation that the event, 
                        activity, team, or entry involved was sponsored 
                        or otherwise funded by a tobacco manufacturer 
                        or distributor prior to the date of the 
                        application; and
                            ``(iii) a certification that the applicant 
                        is unable to secure funding for the event, 
                        activity, team, or entry involved from sources 
                        other than those described in clause (ii).
                    ``(C) Permissible Sponsorship Activities.--Events, 
                activities, teams, or entries for which a grant may be 
                provided under this paragraph include--
                            ``(i) an athletic, musical, artistic, or 
                        other social or cultural event or activity that 
                        was sponsored in whole or in part by a tobacco 
                        manufacturer or distributor prior to the date 
                        of enactment of this title;
                            ``(ii) the participation of a team that was 
                        sponsored in whole or in part by a tobacco 
                        manufacturer or distributor prior to the date 
                        of enactment of this title, in an athletic 
                        event or activity; and
                            ``(iii) the payment of a portion or all of 
                        the entry fees of, or other financial or 
                        technical support provided to, an individual or 
                        team by a tobacco manufacturer or distributor 
                        prior to the date of enactment of this title, 
                        for participation of the individual in an 
                        athletic, musical, artistic, or other social or 
                        cultural event.
    ``(d) Allocation of Funds.--A State shall ensure that amounts 
received under a block grant under subsection (a) are used to carry out 
each of the activities described in subsection (c).
    ``(e) Funding.--The Secretary shall use amounts available under 
section 2812(b)(4) to carry out this section.

            ``Subtitle C--Reduction in Underage Tobacco Use

``SEC. 2831. PURPOSE.

    ``It is the purpose of this subtitle to encourage the achievement 
of reductions in the number of underage consumers of tobacco products 
through the imposition of additional financial deterrents relating to 
tobacco products if certain underage tobacco-use reduction targets are 
not met.

``SEC. 2832. CHILD TOBACCO USE SURVEYS.

    ``(a) Annual Performance Survey.--Not later than 1 year after the 
date of the enactment of this Act and annually thereafter the Secretary 
shall conduct a survey to determine the number of children who used 
each manufacturer's tobacco products within the past 30 days.
    ``(b) Exclusion of Certain Ages.--The Secretary may exclude from 
the survey conducted under subsection (a), children under the age of 12 
years (or such other lesser age as the Secretary may establish) to 
strengthen the validity of the survey.
    ``(c) Baseline Level.--The baseline level of the child tobacco 
product use of a manufacturer (referred to in this subtitle as the 
`baseline level') is the number of children determined to have used the 
tobacco products of such manufacturer in the first annual performance 
survey for 1998.
    ``(d) Additional Measures.--In order to increase the understanding 
of youth tobacco product use, the Secretary may, for informational 
purposes only, add additional measures to the survey under subsection 
(a), conduct periodic or occasional surveys at other times, and conduct 
surveys of other populations such as young adults. The results of such 
surveys shall be made available to manufacturers and the public to 
assist in efforts to reduce youth tobacco use.
    ``(e) Definition.--As used in this subtitle, the term `tobacco 
product' means cigarettes, smokeless tobacco products, and roll-your-
own tobacco products.

``SEC. 2833. REDUCTION IN UNDERAGE TOBACCO PRODUCT USAGE.

    ``(a) Standards for Existing Manufacturers.--Each manufacturer 
which manufactured a tobacco product on or before the date of the 
enactment of this title shall reduce the number of children who use its 
tobacco products so that the number of children determined to have used 
its tobacco products on the basis of--
            ``(1) the fourth annual performance survey is equal to or 
        less than--
                    ``(A) 60 percent of the manufacturer's baseline 
                level; or
                    ``(B) the de minimis level;
        whichever is greater;
            ``(2) the fifth annual performance survey is equal to or 
        less than--
                    ``(A) 50 percent of the manufacturer's baseline 
                level; or
                    ``(B) the de minimis level;
        whichever is greater;
            ``(3) the sixth annual performance survey is equal to or 
        less than--
                    ``(A) 40 percent of the manufacturer's baseline 
                level; or
                    ``(B) the de minimis level;
        whichever is greater;
            ``(4) the seventh annual performance survey is equal to or 
        less than--
                    ``(A) 35 percent of the manufacturer's baseline 
                level; or
                    ``(B) the de minimis level;
        whichever is greater;
            ``(5) the eighth annual performance survey is equal to or 
        less than--
                    ``(A) 30 percent of the manufacturer's baseline 
                level; or
                    ``(B) the de minimis level;
        whichever is greater;
            ``(6) the ninth annual performance survey is equal to or 
        less than--
                    ``(A) 25 percent of the manufacturer's baseline 
                level; or
                    ``(B) the de minimis level;
        whichever is greater; and
            ``(7) the 10th annual performance survey and each annual 
        performance survey conducted thereafter is equal to or less 
        than--
                    ``(A) 20 percent of the manufacturer's baseline 
                level; or
                    ``(B) the de minimis level;
        whichever is greater.
    ``(b) Standards for New Manufacturers.--Any manufacturer of a 
tobacco product which begins to manufacture a tobacco product after the 
date of the enactment of this title shall ensure that the number of 
children determined to have used the manufacturer's tobacco products in 
each annual performance survey conducted after the manufacturer begins 
to manufacture tobacco products is equal to or less than the de minimis 
level.
    ``(c) De Minimis Level.--The de minimis level shall be 0.5 percent 
of the total number of children determined to have used tobacco 
products in the first annual performance survey.

``SEC. 2834. NONCOMPLIANCE.

    ``(a) Violation of Standard.--If, with respect to a year, a 
manufacturer of a tobacco product fails to comply with the required 
reduction under section 2833(a), the manufacturer shall pay to the 
Secretary a noncompliance fee for each unit of tobacco products 
manufactured by the manufacturer which is distributed for consumer use 
in the year following the year in which the noncompliance occurs, in 
the amount specified in subsection (b).
    ``(b) Noncompliance Fee Per Unit.--
            ``(1) In general.--With respect to a year, a manufacturer 
        of a tobacco product shall be required to pay a noncompliance 
        fee for each unit of tobacco products manufactured by the 
        manufacturer if the noncompliance factor of the manufacturer 
        (as determined under paragraph (3)) for the year is greater 
        than zero.
            ``(2) Amount of fee.--The amount of the noncompliance fee 
        that is required to be paid by a manufacturer under this 
        section for each unit of tobacco products manufactured by the 
        manufacturer for the year involved shall be equal to--
                    ``(A) 2 cents multiplied by so much of the 
                noncompliance factor as does not exceed 5;
                    ``(B) 3 cents multiplied by so much of the 
                noncompliance factor as exceeds 5 but does not exceed 
                10;
                    ``(C) 4 cents multiplied by so much of the 
                noncompliance factor as exceeds 10 but does not exceed 
                15;
                    ``(D) 5 cents multiplied by so much of the 
                noncompliance factor as exceeds 15 but does not exceed 
                20; and
                    ``(E) 6 cents multiplied by so much of the 
                noncompliance factor as exceeds 20 but does not exceed 
                25.
            ``(3) Noncompliance factor.--The noncompliance factor of a 
        manufacturer shall be equal to 100 multiplied by the 
        noncompliance percentage of the manufacturer (as determined 
        under paragraph (4)).
            ``(4) Noncompliance percentage.--The noncompliance 
        percentage (if any) of a manufacturer shall be equal to 1 less 
        the ratio of--
                    ``(A) the actual reduction that is achieved by the 
                manufacturer in the number of children who use the 
                manufacturer's tobacco products in the year involved; 
                and
                    ``(B) the reduction required under section 2833(a) 
                in the number of children who use the manufacturer's 
                tobacco products for the year.
    ``(c) Noncompliance Fees For Consecutive Violations.--If a 
manufacturer of a tobacco product fails to comply with the required 
reduction under section 2833(a) in 2 or more consecutive years, the 
noncompliance fee that is required to be paid by the manufacturer under 
this section for each unit of tobacco products manufactured by such 
manufacturer which is distributed for consumer use in the year 
following the year in which the noncompliance occurs, shall be the 
amount determined under subsection (b) for the year multiplied by the 
number of consecutive years in which the manufacturer has failed to 
comply with such required reductions.
    ``(d) Prohibition on Single-Pack Sales in Cases of Repeated 
Noncompliance.--Not later than 1 year after the date of enactment of 
this title, the Secretary shall establish regulations to prohibit the 
sale of single packs of a manufacturer's tobacco products in cases of 
repeated noncompliance with the reductions required under section 
2833(a). Such regulations shall require that, if a manufacturer fails 
to comply with such reductions in 3 or more consecutive years, the 
manufacturer's tobacco products may be sold in the following year only 
in packages containing not less than 10 units of the product per 
package (200 cigarettes per package in the case of cigarettes, and a 
corresponding package size for other tobacco products).
    ``(e) Required Generic Packaging in Severe Cases of Repeated 
Noncompliance.--Not later than 1 year after the date of enactment of 
this title, the Secretary shall establish regulations to require units 
and packages of a manufacturer's tobacco products to have generic 
packaging in severe cases of repeated noncompliance with the reductions 
required under section 2833(a). Such regulations shall require that, if 
a manufacturer fails to comply with such reductions in 4 or more 
consecutive years, the manufacturer's tobacco products may be sold in 
the following year only in units and packages whose packaging contains 
no external images, logos, or text (other than any required labels), 
except that the brand name and the identifier `tobacco' may appear on 
the packaging in block lettering in black type on a white background.
    ``(f) Payment.--The noncompliance fee to be paid by a manufacturer 
under this section shall be paid on a quarterly basis, with payments 
due not later than 30 days after the end of each calendar quarter.

``SEC. 2835. USE OF AMOUNTS.

    ``Of the amounts received under section 2834--
            ``(1) 37.5 percent of such amounts shall be made available 
        to the National Biomedical and Basic Scientific Research Board 
        for research, training and demonstration project grants under 
        section 2822;
            ``(2) 37.5 percent of such amounts shall be made available 
        to the Secretary for healthy child development grants under 
        section 2823; and
            ``(3) 25 percent of such amounts shall be made available to 
        the Secretary for reduction and addiction prevention research 
        grants and for grants under the national tobacco usage 
        reduction and education program under part 2 of subtitle C.

``SEC. 2836. MISCELLANEOUS PROVISIONS.

    ``(a) Judicial Review.--A manufacturer of tobacco products may seek 
judicial review of any action under this subtitle only after a 
noncompliance fee has been assessed and paid by the manufacturer and 
only in the United States District Court for the District of Columbia. 
In an action by a manufacturer seeking judicial review of an annual 
performance survey, the manufacturer may prevail--
            ``(1) only if the manufacturer shows that the results of 
        the performance survey were arbitrary and capricious; and
            ``(2) only to the extent that the manufacturer shows that 
        it would have been required to pay a lesser noncompliance fee 
        if the results of the performance survey were not arbitrary and 
        capricious.
    ``(b) Pass-through.--Nothing in this subtitle shall be construed as 
prohibiting a manufacturer from passing the costs of the amount of any 
noncompliance fee assessed under this subtitle on to consumers of 
tobacco products as a further economic deterrent to the use of such 
products.
    ``(c) Prohibition.--No stay or other injunctive relief may be 
granted by the Secretary or any court that has the effect of enjoining 
the imposition and collection of noncompliance fees to be applied under 
this section.
    ``(d) Child.--As used in this subtitle, the term `child' means, 
except as provided in section 2832(b), an individual who is under the 
age of 18.

                 ``Subtitle D--Miscellaneous Provisions

``SEC. 2841. WHISTLEBLOWER PROTECTIONS.

    ``(a) Prohibition of Reprisals.--An employee of any manufacturer, 
distributor, or retailer of a tobacco product may not be discharged, 
demoted, or otherwise discriminated against (with respect to 
compensation, terms, conditions, or privileges of employment) as a 
reprisal for disclosing to an employee of the Food and Drug 
Administration, the Department of Health and Human Services, the 
Department of Justice, or any State or local regulatory or enforcement 
authority, information relating to a substantial violation of law 
related to this title or a State or local law enacted to further the 
purposes of this title.
    ``(b) Enforcement.--Any employee or former employee who believes 
that such employee has been discharged, demoted, or otherwise 
discriminated against in violation of subsection (a) may file a civil 
action in the appropriate United States district court before the end 
of the 2-year period beginning on the date of such discharge, demotion, 
or discrimination.
    ``(c) Remedies.--If the district court determines that a violation 
has occurred, the court may order the manufacturer, distributor, or 
retailer involved to--
            ``(1) reinstate the employee to the employee's former 
        position;
            ``(2) pay compensatory damages; or
            ``(3) take other appropriate actions to remedy any past 
        discrimination.
    ``(d) Limitation.--The protections of this section shall not apply 
to any employee who--
            ``(1) deliberately causes or participates in the alleged 
        violation of law or regulation; or
            ``(2) knowingly or recklessly provides substantially false 
        information to the Food and Drug Administration, the Department 
        of Health and Human Services, the Department of Justice, or any 
        State or local regulatory or enforcement authority.

``SEC. 2842. NATIONAL TOBACCO DOCUMENT DEPOSITORY.

    ``(a) Purpose.--It is the purpose of this section to provide for 
the disclosure of previously nonpublic or confidential documents by 
manufacturers of tobacco products, including the results of internal 
health research, and to provide for a procedure to settle claims of 
attorney-client privilege, work product, or trade secrets with respect 
to such documents.
    ``(b) Establishment.--
            ``(1) In general.--The Secretary shall provide for the 
        establishment, either within the Department of Health and Human 
        Services or through a private nonprofit entity, of a National 
        Tobacco Document Depository (in this section referred to as the 
        `Depository'). Such Depository shall be located in the 
        Washington, D.C. area and be open to the public.
            ``(2) Documents.--Manufacturers of tobacco products, acting 
        in conjunction with the Tobacco Institute and the Council for 
        Tobacco Research, U.S.A., shall, not later than 30 days after 
        the date of enactment of this title, provide documents to the 
        Depository in accordance with this section.
            ``(3) Funding.--The entities described in paragraph (2) 
        shall bear the sole responsibility for funding the Depository.
    ``(c) Use of Depository.--The Depository shall be maintained in a 
manner that permits the Depository to be used as a resource for 
litigants, public health groups, and any other individuals who have an 
interest in the corporate records and research of the manufacturers 
concerning smoking and health, addiction or nicotine dependency, safer 
or less hazardous cigarettes, and underage tobacco use and marketing.
    ``(d) Contents.--The Depository shall include (and manufacturers 
and the Tobacco Institute and the Council for Tobacco Research, U.S.A. 
shall provide)--
            ``(1) within 90 days of the date of the establishment of 
        the Depository, all documents provided by such entities to 
        plaintiffs in--
                    ``(A) civil or criminal actions brought by State 
                attorneys general (including all documents selected by 
                plaintiffs from the Guilford Repository of the United 
                Kingdom);
                    ``(B) Philip Morris Companies Inc.'s defamation 
                action against Capital Cities/American Broadcasting 
                Company News;
                    ``(C) the Federal Trade Commission's investigation 
                concerning Joe Camel and underage marketing;
                    ``(D) Haines v. Liggett Group, Inc. (814 F. Supp. 
                414 (D.N.J., Jan. 26, 1993)) and Cippollone v. Liggett 
                Group, Inc. (822 F. 2d 335, 56 USLW 2028, 7 Fed. R. 
                Serv. 3d 1438 (3rd Cir. (N.J.), Jun. 8, 1987)); and
                    ``(E) Estate of Burl Butler v. Philip Morris, Inc. 
                (case No. 94-4-53);
            ``(2) within 90 days after the date of the establishment of 
        the Depository, any existing documents discussing or referring 
        to health research, addiction or dependency, safer or less 
        hazardous cigarettes, studies of the smoking habits of minors, 
        and the relationship between advertising or promotion and youth 
smoking, that the entities described in subsection (b) have not 
completed producing as required in the actions described in paragraph 
(1);
            ``(3) within 30 days of the date of the establishment of 
        the Depository, all documents relating to indices (as defined 
        by the court in State of Minnesota and Blue Cross and Blue 
        Shield of Minnesota v. Philip Morris, Inc., et al.) of 
        documents relating to smoking and health, including all indices 
        identified by the manufacturers in the State of Texas v. 
        American Tobacco Company, et al.;
            ``(4) upon the settlement of any action referred to in this 
        subsection, and after a good-faith, de novo, document-by-
        document review of all documents previously withheld from 
        production in any actions on the grounds of attorney-client 
        privilege, all documents determined to be outside of the scope 
        of the privilege;
            ``(5) all existing or future documents relating to original 
        laboratory research concerning the health or safety of tobacco 
        products, including all laboratory research results relating to 
        methods used to make tobacco products less hazardous to 
        consumers;
            ``(6) a comprehensive new attorney-client privilege log of 
        all documents, itemized in sufficient detail so as to enable 
        any interested individual to determine whether the individual 
        will challenge the claim of privilege, that the entities 
        described in subsection (b) (based on the de novo review of 
        such documents by such entities) claim are protected from 
        disclosure under the attorney-client privilege;
            ``(7) all existing or future documents relating to studies 
        of the smoking habits of minors or documents referring to any 
        relationship between advertising and promotion and underage 
        smoking; and
            ``(8) all other documents determined appropriate under 
        regulations promulgated by the Secretary.
    ``(e) Dispute Resolution Panel.--
            ``(1) Establishment.--The Judicial Conference of the United 
        States shall establish a Tobacco Documents Dispute Resolution 
        Panel, to be composed of 3 Federal judges to be appointed by 
        the Conference, to resolve all disputes involving claims of 
        attorney-client, work product, or trade secrets privilege with 
        respect to documents required to be deposited into the 
        Depository under subsection (d) that may be brought by Federal, 
        State, or local governmental officials or the public or 
        asserted in any action by a manufacturer.
            ``(2) Basis for determinations.--The determinations of the 
        Panel established under paragraph (1) shall be based on--
                    ``(A) the American Bar Association/American Law 
                Institute Model Rules or the principals of Federal law 
                with respect to attorney-client or work product 
                privilege; and
                    ``(B) the Uniform Trade Secrets Act with respect to 
                trade secrecy.
            ``(3) Decision.--Any decision of the Panel established 
        under paragraph (1) shall be final and binding upon all Federal 
        and State courts.
            ``(4) Assessing of fees.--As part of a determination under 
        this subsection, the Panel established under paragraph (1) 
        shall determine whether a claimant of the privilege acted in 
        good faith and had a factual and legal basis for asserting the 
        claim. If the Panel determines that the claimant did not act in 
        good faith, the Panel may assess costs against the claimant, 
        including a reasonable attorneys' fee, and may apply such other 
        sanctions as the Panel determines appropriate.
            ``(5) Accelerated review.--The Panel established under 
        paragraph (1) shall establish procedures for the accelerated 
        review of challenges to a claim of privilege. Such procedures 
        shall include assurances that an individual filing a challenge 
        to such a claim need not make a prima facie showing of any kind 
        as a prerequisite to an in-camera review of the documents at 
        issue.
            ``(6) Special masters.--The Panel established under 
        paragraph (1) may appoint Special Masters in accordance with 
        Rule 53 of the Federal Rules of Civil Procedure. The cost 
        relating to any Special Master shall be assessed to the 
        manufacturers as part of a fee process to be established under 
        regulations promulgated by the Secretary.
    ``(f) Other Provisions.--
            ``(1) No waiver of privilege.--Compliance with this section 
        by the entities described in subsection (b) shall not be deemed 
        to be a waiver on behalf of such entities of any applicable 
        privilege or protection.
            ``(2) Avoidance of destruction.--In establishing the 
        Depository, procedures shall be implemented to protect against 
        the destruction of documents.
            ``(3) Deemed produced.--Any documents contained in the 
        Depository shall be deemed to have been produced for purposes 
        of any tobacco-related litigation in the United States.
    ``(g) Documents.--For purposes of this section, the term 
`documents' shall include any paper documents that may be printed using 
data that is contained in computer files.
    ``(h) Rule of Construction.--Nothing in this section shall be 
construed to interfere in any way with the discovery rights of courts 
or parties in civil or criminal actions involving tobacco products, or 
the right of access to such documents under any other provision of law.

``SEC. 2843. TOBACCO OVERSIGHT AND COMPLIANCE BOARD.

    ``(a) Establishment.--
            ``(1) In general.--There is established an independent 
        board to be known as the Tobacco Oversight and Compliance Board 
        (referred to in this section as the `Board').
            ``(2) Membership.--The Board shall consist of 5 members 
        with expertise relating to tobacco and public health. The 
        members, including the chairperson, shall be appointed by the 
        Secretary. The initial members of the Board shall be appointed 
        by the Secretary within 30 days of the date of the enactment of 
        this title. A member of the Board may be removed by the 
        Secretary only for neglect of duty or malfeasance in office.
            ``(3) Terms.--The term of office of a member of the Board 
        shall be 6 years, except that the members first appointed shall 
        have terms of 2, 3, 4, and 5 years, respectively, as determined 
        by the Secretary.
    ``(b) General Duty.--The Board shall oversee and monitor the 
operations of the tobacco industry to determine whether tobacco product 
manufacturers are in compliance with this Act.
    ``(c) Disclosure of Tobacco Industry Documents.--
            ``(1) Submission by manufacturers.--Not later than 3 months 
        after the date of the enactment of this title, and as otherwise 
        required by the Board, each tobacco manufacturer shall submit 
        to the Board a copy of all documents in the manufacturer's 
        possession--
                    ``(A) relating to--
                            ``(i) any health effects, including 
                        addiction, caused by the use of tobacco 
                        products;
                            ``(ii) the manipulation or control of 
                        nicotine in tobacco products; or
                            ``(iii) the sale or marketing of tobacco 
                        products to children; or
                    ``(B) produced, or ordered to be produced, by the 
                tobacco manufacturer in the case entitled State of 
                Minnesota v. Philip Morris, Inc., Civ. Action No. C1-
                94-8565 (Ramsey County, Minn.) including attorney-
                client and other documents produced or ordered to be 
                produced for in camera inspection.
            ``(2) Disclosure by the board.--Not later than 6 months 
        after the date of the enactment of this title, and otherwise as 
        required by the Board, the Board shall, subject to paragraph 
        (3), make available to the public the documents submitted under 
        paragraph (1).
            ``(3) Protection of trade secrets.--The Board, members of 
        the Board, and staff of the Board shall not disclose 
        information that is entitled to protection as a trade secret 
        unless the Board determines that disclosure of such information 
        is necessary to protect the public health. This paragraph shall 
        not be construed to prevent the disclosure of relevant 
        information to other Federal agencies or to committees of the 
        Congress.
    ``(d) Investigation and Annual Reports.--The Board shall 
investigate all matters relating to the tobacco industry and public 
health and report annually on the results of the investigation to 
Congress. Each annual report to Congress shall, at a minimum, 
disclose--
            ``(1) whether tobacco manufacturers are in compliance with 
        the provisions of this Act;
            ``(2) any efforts by tobacco manufacturers to conceal 
        research relating to the adverse health effects or addiction 
        caused by the use of tobacco products;
            ``(3) any efforts by tobacco manufacturers to mislead the 
        public or any Federal, State, or local elected body, agency, or 
        court about the adverse health effects or addiction caused by 
        the use of tobacco products;
            ``(4) any efforts by tobacco manufacturers to sell or 
        market tobacco products to children; and
            ``(5) any efforts by tobacco manufacturers to circumvent, 
        repeal, modify, impede the implementation of, or prevent the 
        adoption of any Federal, State, or local law or regulation 
        intended to reduce the adverse health effects or addiction 
caused by the use of tobacco products.
    ``(e) Authority.--The Board, any member of the Board, or staff 
designated by the Board may hold hearings, administer oaths, issue 
subpoena, require the testimony or deposition of witnesses, the 
production of documents, or the answering of interrogatories, or, upon 
presentation of the proper credentials, enter and inspect facilities.
    ``(f) Enforcement.--Notwithstanding any other provision of law, 
tobacco manufacturers shall provide any testimony, deposition, 
documents, or other information, answer any interrogatories, and allow 
any entry or inspection required pursuant to this section, except to 
the extent that a constitutional privilege protects the tobacco 
manufacturer from complying with such requirement.
    ``(g) Administration.--
            ``(1) Staff.--The Chairperson of the Board shall exercise 
        the executive and administrative functions of the Board and 
        shall have the authority to hire such staff as may be necessary 
        for the operation of the Board.
            ``(2) Salaries.--The members of the Board shall receive 
        such salary and benefits as the Secretary deems necessary, 
        except that the salary of the Chairperson shall not be less 
        than that provided for under level III of the Executive 
        Schedule in section 5314 of title 5, United States Code.

``SEC. 2844. PRESERVATION OF STATE AND LOCAL AUTHORITY.

    ``Except as otherwise provided for in this title or the Healthy and 
Smoke Free Children Act (or an amendment made by such Act), nothing in 
this title or such Act shall be construed as prohibiting a State from 
imposing requirements, prohibitions, penalties or other measures to 
further the purposes of this title or Act that are in addition to the 
requirements, prohibitions, or penalties required under this title or 
Act. To the extent not inconsistent with the purposes of this title or 
Act, State and local governments may impose additional tobacco product 
control measures to further restrict or limit the use of such products 
by minors.

``SEC. 2845. REGULATIONS.

    ``The Secretary may promulgate regulations to enforce the 
provisions of this title, or to modify, alter, or expand the 
requirements and protections provided for in this title if the 
Secretary determines that such modifications, alternations, or 
expansion is necessary.''.

            TITLE II--FDA JURISDICTION OVER TOBACCO PRODUCTS

   Subtitle A--Amendments to the Federal Food, Drug and Cosmetic Act

SEC. 201. REFERENCE.

    Whenever in this subtitle an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et 
seq.).

SEC. 202. STATEMENT OF GENERAL AUTHORITY.

    The Secretary of Health and Human Services, acting through the Food 
and Drug Administration, shall have the authority under the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 321 et seq.) (above and beyond 
the existing authority of the Secretary to regulate tobacco products as 
of the date of enactment of this Act) to regulate the manufacture, 
labeling, sale, distribution, and advertising of tobacco products.

SEC. 203. TREATMENT OF TOBACCO PRODUCTS AS DRUGS AND DEVICES.

    (a) Definitions.--
            (1) Drug.--Section 201(g)(1) (21 U.S.C. 321(g)(1)) is 
        amended by striking ``; and (D)'' and inserting ``(including 
        nicotine in tobacco products); and (D)''.
            (2) Devices.--Section 201(h) (21 U.S.C. 321(h)) is 
        amended--
                    (A) in paragraph (3), by inserting before the comma 
                the following: ``(including tobacco products containing 
                nicotine); and
                    (B) by adding at the end the following: ``For 
                purposes of this Act a tobacco product shall be 
                classified as a class II device.''.
            (3) Other definitions.--Section 201 (21 U.S.C. 321) is 
        amended by adding at the end thereof the following new 
        paragraphs:
    ``(ii)(1) The term `tobacco product' means cigarettes, cigarillos, 
cigarette tobacco, little cigars, pipe tobacco, and smokeless tobacco, 
and roll-your-own tobacco.
    ``(2) The term `cigarette' means any product which contains 
nicotine, is intended to be burned under ordinary conditions of use, 
and consists of--
            ``(A) any roll of tobacco wrapped in paper or in any 
        substance not containing tobacco; and
            ``(B) any roll of tobacco wrapped in any substance 
        containing tobacco which, because of its appearance, the type 
        of tobacco used in the filler, or its packaging and labeling, 
        is likely to be offered to, or purchased by, consumers as a 
        cigarette described in subparagraph (A).
    ``(3) The term `cigarette tobacco' means any product that consists 
of loose tobacco that contains or delivers nicotine and is intended for 
use by persons in a cigarette. Unless otherwise stated, the 
requirements of this title pertaining to cigarettes shall also apply to 
cigarette tobacco.
    ``(4) The term `smokeless tobacco' means any product that consists 
of cut, ground, powdered, or leaf tobacco that contains nicotine and 
that is intended to be placed in the oral or nasal cavity.
    ``(5) The term `roll-your-own tobacco' has the meaning given such 
term by section 5702(p) of the Internal Revenue Code of 1986.
    ``(6) The term `little cigars' means any roll of tobacco wrapped in 
leaf tobacco or any substance containing tobacco (other than any roll 
of tobacco which is a cigarette within the meaning of this Act) and as 
to which 1,000 units weigh not more than 3 pounds.
    ``(7) The term `cigar' means any roll of tobacco wrapped in leaf 
tobacco or in any substance containing tobacco (other than any roll of 
tobacco which is a cigarette or cigarillo within the meaning of 
paragraph (3) or (4)).
    ``(8) The term `cigarillos' means any roll of tobacco wrapped in 
leaf tobacco or any substance containing tobacco (other than any roll 
of tobacco which is a cigarette within the meaning of paragraph (3)) 
and as to which 1,000 units weigh not more than 3 pounds.
    ``(9) The term `pipe tobacco' means any loose tobacco that, because 
of its appearance, type, packaging, or labeling, is likely to be 
offered to, or purchased by, consumers as a tobacco product to be 
smoked in a pipe.
    ``(10) The term `nicotine' means the chemical substance named 3-(1-
Methyl-2-pyrrolidinyl)pyridine or 
C<INF>10</INF>H<INF>14</INF>N<INF>2</INF>, including any salt or 
complex of nicotine.''.
    ``(11) The term `tobacco additive' means any substance the intended 
use of which results or may reasonably be expected to result, directly 
or indirectly, in the substance becoming a component of, or otherwise 
affecting the characteristics of, any tobacco product, including any 
substance that may have been removed from the tobacco product and then 
readded in the substance's original or modified form.
    ``(12) The term `tar' means mainstream total articulate matter 
minus nicotine and water.''.
    (b) Misbranding.--Section 502(q) (21 U.S.C. 352(q)) is amended--
            (1) by striking ``or (2)'' and inserting ``(2)''; and
            (2) by inserting before the period the following: ``or (3) 
        in the case of a tobacco product, it is sold, distributed, 
        advertised, labeled, or used in violation of this Act or the 
        regulations prescribed under this Act.''.
    (c) Regulatory Authority.--Section 503(g)(1) (21 U.S.C. 353(g)(1)) 
is amended by inserting ``(including any tobacco product)'' after 
``products'' the first place such term appears.
    (d) Class II Devices.--Section 513(a)(1)(B) (21 U.S.C. 
360c(a)(1)(B)) is amended--
            (1) by striking ``A device'' and inserting ``(i) A 
        device''; and
            (2) by adding at the end the following: ``Tobacco products 
        shall be categorized as Class II devices.
                    ``(ii) The sale of tobacco products to adults that 
                comply with Performance Standards established for these 
                products pursuant to section 514, title XXVIII of the 
                Public Health Service Act, and this Act, and any 
                regulations prescribed under this Act, shall not be 
                prohibited by the Secretary, notwithstanding sections 
                502(j), 516, and 518.''.
    (e) Performance Standards.--Section 514(a) (21 U.S.C. 360d(a)) is 
amended--
            (1) in paragraph (2), by striking ``device--'' and 
        inserting ``non-tobacco product device--'';
            (2) by redesignating paragraphs (3) and (4) as paragraphs 
        (4) and (5), respectively; and
            (3) by adding at the end the following:
    ``(3)(A) A performance standard established under this section for 
a tobacco product device--
            ``(i) shall include provisions to reduce the overall health 
        risks to the public, including the reduction in risk to 
        consumers thereof and the reduction in harm which will result 
        from those who continue to use the product, but less often and 
        from those who stop or do not start using the product, taking 
        into account all factors that the Secretary determines to be 
        relevant;
            ``(ii) shall, where necessary to provide a reduction in the 
        overall health risks to the public, include--
                    ``(I) provisions regarding the construction, 
                components, constituents, ingredients, and properties 
                of the tobacco product device, including the reduction 
                or elimination of nicotine and the other components, 
                ingredients, and constituents of the tobacco product 
                and its components, based upon the best available 
                technology;
                    ``(II) provisions for the testing of the tobacco 
                product device (on a sample basis or, if necessary, on 
                an individual basis) or, if it determined that no other 
                more practicable means are available to the Secretary 
                to assure the conformity of the tobacco product device 
                to the standard, provision for the testing (on a sample 
                basis or, if necessary, on an individual basis) by the 
                Secretary or by another person at the direction of the 
                Secretary;
                    ``(III) provisions for the measurement of the 
                performance characteristics of the tobacco product 
                device;
                    ``(IV) provisions requiring that the results of 
                each or of certain of the tests of the tobacco product 
                device required to be made under subclause (II) show 
                that the tobacco product device is in conformity with 
                the portions of the standard for which the test or 
                tests were required; and
                    ``(V) a provision that the sale, advertising, and 
                distribution of the tobacco product device be 
                restricted but only to the extent the sale, 
                advertising, and distribution of a tobacco product 
                device may be restricted under this Act or title XXVIII 
                of the Public Health Service Act; and
            ``(iii) shall, where appropriate, require the use and 
        prescribe the form and content of labeling for use of the 
        tobacco product device.
    ``(B) The Secretary shall provide for the periodic evaluation of a 
performance standard established under this paragraph to determine if 
such standards should be changed to reflect new medical, scientific, or 
other technological data.
    ``(C) In carrying out this paragraph, the Secretary shall, to the 
maximum extent practicable--
            ``(i) use personnel, facilities, and other technical 
        support available in other Federal agencies;
            ``(ii) consult with the Scientific Advisory Committee 
        established under section 905 and other Federal agencies 
        concerned with standard-setting and other nationally or 
        internationally recognized standard-setting entities; and
            ``(iii) invite appropriate participation, through joint or 
        other conferences, workshops, or other means, by informed 
        persons representative of scientific, professional, industry, 
        or consumer organizations who in the judgment of the Secretary 
        can make a significant contribution.''.
    (f) Restricted Devices.--Section 520(e) (21 U.S.C. 360j(e)) is 
amended by adding at the end the following:
    ``(3) A tobacco product is a restricted device.''.
    (g) Regulations.--Section 701(a) (21 U.S.C. 371(a)) is amended by 
inserting before the period the following: ``, including the authority 
to regulate the manufacture, sale, distribution, advertising and 
marketing of tobacco products''.

SEC. 204. GENERAL HEALTH AND SAFETY REGULATION OF TOBACCO PRODUCTS.

    The Act (21 U.S.C. 301 et seq.) is amended--
            (1) by redesignating chapter IX as chapter X;
            (2) by redesignating sections 901, 902, 903, 904, and 905 
        as sections 1001, 1002, 1003, 1004, and 1005, respectively; and
            (3) by adding after chapter VIII the following new chapter:

                     ``CHAPTER IX--TOBACCO PRODUCTS

``SEC. 901. DEFINITIONS.

    ``For purposes of this chapter and in addition to the definitions 
contained in section 201, the definitions under section 2801 of the 
Public Health Service Act shall apply.

``SEC. 902. PURPOSE.

    ``It is the purpose of this chapter to impose a regulatory scheme 
applicable to the development and manufacturing of tobacco products. 
Such scheme shall include--
            ``(1) with respect to ingredients contained in such 
        products--
                    ``(A) the immediate and annual reporting, in 
                accordance with section 909(a), of all ingredients 
                contained in such products;
                    ``(B) the performance, in accordance with section 
                909(b), of safety assessments with respect to 
                ingredients contained in such products; and
                    ``(C) the approval, in accordance with section 
                909(b), of ingredients contained in such products; and
            ``(2) the imposition of standards to reduce the level of 
        certain constituents contained in such products, including 
        nicotine.

``SEC. 903. PROMULGATION OF REGULATIONS.

    ``The Commissioner shall promulgate regulations governing the 
misbranding, adulteration, and dispensing of tobacco products that are 
consistent with this chapter and with the manner in which other 
products that are ingested into the body are regulated under this Act. 
Such regulations shall be promulgated not later than 12 months after 
the date of enactment of this chapter.

``SEC. 904. MINIMUM REQUIREMENTS.

    ``(a) Misbranding.--The regulations promulgated under section 903 
shall at a minimum require that a tobacco product be deemed to be 
misbranded if the labeling of the package of such product is not in 
compliance with the provisions of this chapter, of other applicable 
provisions of this Act, or of section 910 (as applicable to the type of 
product involved) of the Public Health Service Act.
    ``(b) Adulteration.--The regulations promulgated under section 903 
shall at a minimum require that a tobacco product be deemed to be 
adulterated if the Commissioner determines that any tobacco additive in 
such product, regardless of the amount of such tobacco additive, either 
by itself or in conjunction with any other tobacco additive or 
ingredient is harmful under the intended conditions of use when used in 
a specified amount.

``SEC. 905. SCIENTIFIC ADVISORY COMMITTEE.

    ``(a) Establishment.--Not later than 1 year after the date of 
enactment of this chapter, the Secretary shall establish an advisory 
committee, to be known as the `Scientific Advisory Committee', to 
assist the Secretary in establishing, amending, or revoking a 
performance standard under section 512(a)(3).
    ``(b) Membership.--The Secretary shall appoint as members of the 
Scientific Advisory Committee any individuals with expertise in the 
medical, scientific, or other technological data involving the 
manufacture and use of tobacco products, and of appropriately 
diversified professional backgrounds. The Secretary may not appoint to 
the Committee any individual who is in the regular full-time employ of 
the Federal Government. The Secretary shall designate 1 of the members 
of each advisory committee to serve as chairperson of the Committee.
    ``(c) Compensation and Expenses.--
            ``(1) Compensation.--Members of the Scientific Advisory 
        Committee who are not officers or employees of the United 
        States, while attending conferences or meetings of the 
        Committee or otherwise serving at the request of the Secretary, 
        shall be entitled to receive compensation at rates to be fixed 
        by the Secretary, which rates may not exceed the daily 
        equivalent of the rate of pay for level 4 of the 
Senior Executive Schedule under section 5382 of title 5, United States 
Code, for each day (including traveltime) they are so engaged.
            ``(2) Expenses.--While conducting the business of the 
        Scientific Advisory Committee away from their homes or regular 
        places of business, each member may be allowed travel expenses, 
        including per diem in lieu of subsistence, as authorized by 
        section 5703 of title 5 of the United States Code for persons 
        in the Government service employed intermittently.
    ``(d) Duties.--The Scientific Advisory Committee shall--
            ``(1) assist the Secretary in establishing, amending, or 
        revoking performance standards under section 514(a)(3);
            ``(2) examine and determine the effects of the alteration 
        of the nicotine yield levels in tobacco products;
            ``(3) examine and determine whether there is a threshold 
        level below which nicotine yields do not produce dependence on 
        the tobacco product involved, and, if so, determine what that 
        level is; and
            ``(4) review other safety, dependence or health issues 
        relating to tobacco products as determined appropriate by the 
        Secretary.

``SEC. 906. REQUIREMENTS RELATING TO NICOTINE AND OTHER CONSTITUENTS.

    ``(a) General Rule.--The Secretary may adopt a performance standard 
under section 514(a)(3) that requires the modification of a tobacco 
product in a manner that involves--
            ``(1) the reduction or elimination of nicotine yields of 
        the product; or
            ``(2) the reduction or elimination of other constituents or 
        harmful components of the product.
    ``(b) Tobacco Constituents.--The Secretary shall promulgate 
regulations for the testing, reporting and disclosure of tobacco smoke 
constituents that the Secretary determines the public should be 
informed of to protect public health, including tar, nicotine, and 
carbon monoxide. Such regulations may require label and advertising 
disclosures relating to tar and nicotine.
    ``(c) Limitation on Tar.--Not later than 3 years after the date of 
enactment of this chapter, the Secretary shall promulgate regulations 
that limit the amount of tar in a cigarette to no more than 12 
milligrams. Nothing in the preceding sentence shall be construed as 
limiting the authority of the Secretary to promulgate regulations 
further limiting the amount of tar that may be contained in a 
cigarette.

``SEC. 907. REDUCED RISK PRODUCTS.

    ``(a) Misbranding.--Except as provided in subsection (b), the 
regulations promulgated in accordance with section 904(a) shall require 
that a tobacco product be deemed to be misbranded if the labeling of 
the package of the product, or the claims of the manufacturer in 
connection with the product, can reasonably be interpreted by an 
objective consumer as stating or implying that the product presents a 
reduced health risk as compared to other similar products.
    ``(b) Exception.--
            ``(1) In general.--Subsection (a) shall not apply to the 
        labeling of a tobacco product, or the claims of the 
        manufacturer in connection with the product, if--
                    ``(A) the manufacturer, based on the best available 
                scientific evidence, demonstrates to the Commissioner 
                that the product significantly reduces the risk to the 
                health of the user as compared to other similar tobacco 
                products; and
                    ``(B) the Commissioner approves the specific claim 
                that will be made a part of the labeling of the 
                product, or the specific claims of the manufacturer in 
                connection with the product.
            ``(2) Reduction in harm.--The Commissioner shall promulgate 
        regulations to permit the inclusion of scientifically-based 
        specific health claims on the labeling of a tobacco product 
        package, or the making of such claims by the manufacturer in 
        connection with the product, where the Commissioner determines 
        that the inclusion or making of such claims would reduce harm 
        to the public and otherwise promote public health.
    ``(c) Development of Reduced Risk Product Technology.--
            ``(1) Notification of commissioner.--The manufacturer of a 
        tobacco product shall provide written notice to the 
        Commissioner upon the development or acquisition by the 
        manufacturer of any technology that would reduce the risk of 
        such products to the health of the user.
            ``(2) Confidentiality.--The Commissioner shall promulgate 
        regulations to provide a manufacturer with appropriate 
        confidentiality protections with respect to technology that is 
        the subject of a notification under paragraph (1) that contains 
evidence that the technology involved is in the early developmental 
stages.
            ``(3) Licensing.--
                    ``(A) In general.--With respect to any technology 
                developed or acquired under paragraph (1), the 
                manufacturer shall--
                            ``(i) use such technology in the 
                        manufacture of its tobacco products; or
                            ``(ii) permit the use of such technology 
                        (for a reasonable fee) by other manufacturers 
                        of tobacco products to which this chapter 
                        applies.
                    ``(B) Fees.--The Commissioner shall promulgate 
                regulations to provide for the payment of a 
                commercially reasonable fee by each manufacturer that 
                uses the technology described under subparagraph (A) to 
                the manufacturer that submits the notice under 
                paragraph (1) for such technology. Such regulations 
                shall contain procedures for the resolution of fee 
                disputes between manufacturers under this subparagraph.
    ``(d) Requirement of Manufacture and Marketing.--
            ``(1) Purpose.--It is the purpose of this subsection to 
        provide for a mechanism to ensure that tobacco products that 
        are designed to be less hazardous to the health of users are 
        developed, tested, and made available to consumers.
            ``(2) Determination.--Upon a determination by the 
        Commissioner that the manufacture of a tobacco product that is 
        less hazardous to the health of users is technologically 
        feasible, the Commissioner may, in accordance with this 
        subsection, require that certain manufacturers of such products 
        manufacture and market such less hazardous products.
            ``(3) Manufacturer.--
                    ``(A) Requirement.--Except as provided in 
                subparagraph (B), the requirement under paragraph (2) 
                shall apply to any manufacturer that provides a 
                notification to the Commissioner under subsection 
                (c)(1) concerning the technology that is the subject of 
                the determination of the Commissioner.
                    ``(B) Exception.--The requirement under 
                subparagraph (A) shall not apply to a manufacturer if--
                            ``(i) the manufacturer elects not to 
                        manufacture such products and provides notice 
                        to the Commissioner of such election; and
                            ``(ii) the manufacturer agrees to provide 
                        the technology involved, for a commercially 
                        reasonable fee, to other manufacturers that 
                        enter into agreements to use such technology to 
                        manufacture and market tobacco products that 
                        are less hazardous to the health of users.

``SEC. 908. GOOD MANUFACTURING PRACTICE STANDARDS.

    ``(a) Authority.--
            ``(1) In general.--The Secretary may, in accordance with 
        paragraph (2), prescribe regulations requiring that the methods 
        used in, and the facilities and controls used for, the 
        manufacture, pre-production design validation (including a 
        process to assess the performance of a tobacco product), 
        packing, and storage of a tobacco product conform to current 
        good manufacturing practice, as prescribed in such regulations, 
        to ensure that such products will be in compliance with this 
        chapter.
            ``(2) Requirements prior to regulations.--Prior to the 
        Secretary promulgating any regulation under paragraph (1) the 
        Secretary shall--
                    ``(A) afford the Scientific Advisory Committee 
                established under section 905 an opportunity (with a 
                reasonable time period) to submit recommendations with 
                respect to the regulations proposed to be promulgated; 
                and
                    ``(B) afford an opportunity for an oral hearing.
    ``(b) Minimum Requirements.--The regulations promulgated under 
subsection (a) shall at a minimum require--
            ``(1) the implementation of a quality control system by the 
        manufacturer of a tobacco product;
            ``(2) a process for the inspection, in accordance with this 
        Act, of tobacco product material prior to the packaging of such 
        product;
            ``(3) procedures for the proper handling and storage of the 
        packaged tobacco product;
            ``(4) after consultation with the Administrator of the 
        Environmental Protection Agency, the development and adherence 
        to applicable tolerances with respect to pesticide chemical 
        residues in or on commodities used by the manufacturer in the 
        manufacture of the finished tobacco product;
            ``(5) the inspection of facilities by officials of the Food 
        and Drug Administration as otherwise provided for in this Act; 
        and
            ``(6) record keeping and the reporting of certain 
        information.
    ``(c) Petitions for Exemptions and Variances.--
            ``(1) In general.--Any person subject to any requirement 
        prescribed by regulations under subsection (a) may petition the 
        Secretary for an exemption or variance from such requirement. 
        Such a petition shall be submitted to the Secretary in such 
        form and manner as the Secretary shall prescribe and shall--
                    ``(A) in the case of a petition for an exemption 
                from a requirement, set forth the basis for the 
                petitioner's determination that compliance with the 
                requirement is not required to ensure that the device 
                is in compliance with this chapter;
                    ``(B) in the case of a petition for a variance from 
                a requirement, set forth the methods proposed to be 
                used in, and the facilities and controls proposed to be 
                used for, the manufacture, packing, and storage of the 
                product in lieu of the methods, facilities, and 
                controls prescribed by the requirement; and
                    ``(C) contain such other information as the 
                Secretary shall prescribe.
            ``(2) Scientific advisory committee.--The Secretary may 
        refer to the Scientific Advisory Committee established under 
        section 905 any petition submitted under paragraph (1). The 
        Scientific Advisory Committee shall report its recommendations 
        to the Secretary with respect to a petition referred to it 
        within 60 days of the date of the petition's referral. Within 
        60 days after--
                    ``(A) the date the petition was submitted to the 
                Secretary under paragraph (1); or
                    ``(B) if the petition was referred to the 
                Scientific Advisory Committee, the expiration of the 
                60-day period beginning on the date the petition was 
                referred to such Committee;
        whichever occurs later, the Secretary shall by order either 
        deny the petition or approve it.
            ``(3) Approval of petition.--
                    ``(A) In general.--The Secretary may approve--
                            ``(i) a petition for an exemption for a 
                        tobacco product from a requirement if the 
                        Secretary determines that compliance with such 
                        requirement is not required to assure that the 
                        product will comply with this chapter; and
                            ``(ii) a petition for a variance for a 
                        tobacco product from a requirement if the 
                        Secretary determines that the methods to be 
                        used in, and the facilities and controls to be 
                        used for, the manufacture, packing, and storage 
                        of the product in lieu of the methods, 
                        controls, and facilities prescribed by the 
                        requirement are sufficient to ensure that the 
                        product will comply with this chapter.
                    ``(B) Conditions.--An order of the Secretary 
                approving a petition for a variance shall prescribe 
                such conditions respecting the methods used in, and the 
                facilities and controls used for, the manufacture, 
                packing, and storage of the tobacco product to be 
                granted the variance under the petition as may be 
                necessary to ensure that the product will comply with 
                this chapter.
            ``(4) Informal hearing.--After the issuance of an order 
        under paragraph (2) respecting a petition, the petitioner shall 
        have an opportunity for an informal hearing on such order.
    ``(d) Agricultural Producers.--The Secretary may not promulgate any 
regulation under this section that has the effect of placing regulatory 
burdens on tobacco producers (as such term is used for purposes of the 
Agricultural Adjustment Act of 1938 (7 U.S.C. 1281 et seq.) and the 
Agricultural Act of 1949 (7 U.S.C. 1441 et seq.)) in excess of the 
regulatory burdens generally placed on other agricultural commodity 
producers.

``SEC. 909. DISCLOSURE AND REPORTING OF NONTOBACCO INGREDIENTS AND 
              CONSTITUENTS.

    ``(a) Disclosure of All Ingredients.--
            ``(1) Immediate and annual disclosure.--Not later than 30 
        days after the date of enactment of this chapter, and annually 
        thereafter, each manufacturer of a tobacco product shall submit 
        to the Secretary an ingredient list for all brands of tobacco 
        products that contains the information described in paragraph 
        (2).
            ``(2) Requirements.--The list described in paragraph (1) 
        shall, with respect to each brand of tobacco product of a 
        manufacturer, include
                    ``(A) a list of all ingredients, constituents, 
                substances, and compounds that are added to the tobacco 
(and the paper or filter of the product if applicable) in the 
manufacture of the tobacco product, for each brand of tobacco product 
so manufactured;
                    ``(B) a description of the quantity of the 
                ingredients, constituents, substances, and compounds 
                that are listed under subparagraph (A) with respect to 
                each brand of tobacco product;
                    ``(C) a description of the nicotine content of the 
                product, measured in milligrams of nicotine;
                    ``(D) with respect to cigarettes a description of--
                            ``(i) the filter ventilation percentage 
                        (the level of air dilution in the cigarette as 
                        provided by the ventilation holes in the 
                        filter, described as a percentage);
                            ``(ii) the pH level of the smoke of the 
                        cigarette; and
                            ``(iii) the nicotine delivery level under 
                        average smoking conditions reported in 
                        milligrams of nicotine per cigarette;
                    ``(E) with respect to smokeless tobacco products a 
                description of--
                            ``(i) the pH level of the tobacco;
                            ``(ii) the moisture content of the tobacco 
                        expressed as a percentage of the weight of the 
                        tobacco; and
                            ``(iii) the nicotine content--
                                    ``(I) for each gram of the product, 
                                measured in milligrams of nicotine;
                                    ``(II) expressed as a percentage of 
                                the dry weight of the tobacco; and
                                    ``(III) with respect to unionized 
                                (free) nicotine, expressed as a 
                                percentage per gram of the tobacco and 
                                expressed in milligrams per gram of the 
                                tobacco; and
                    ``(F) any other information determined appropriate 
                by the Secretary.
    ``(b) Safety Assessments.--
            ``(1) Application to new ingredients.--
                    ``(A) In general.--Not later than 1 year after the 
                date of enactment of this chapter, and annually 
                thereafter, each manufacturer shall submit to the 
                Secretary a safety assessment for each new ingredient, 
                constituent, substance, or compound that such 
                manufacturer desires to make a part of a tobacco 
                product. Such new ingredient, constituent, substance, 
                or compound shall not be included in a tobacco product 
                prior to approval of such a safety assessment.
                    ``(B) Definition of new ingredient.--For purposes 
                of subparagraph (A), the term `new ingredient, 
                constituent, substance, or compound' means an 
                ingredient, constituent substance, or compound listed 
                under subsection (a)(1) that was not used in the brand 
                of tobacco product involved prior to the date of 
                enactment of this chapter.
            ``(2) Application to other ingredients.--With respect to 
        the application of this section to ingredients, constituents 
        substances, or compounds listed under subsection (a) to which 
        paragraph (1) does not apply, all such ingredients, 
        constituents, substances, or compounds shall be approved 
        through the safety assessment process within the 5-year period 
        beginning on the date of enactment of this chapter. The 
        Secretary shall develop a procedure that staggers the 
        percentage of such ingredients, constituents, substances, or 
        compounds for which safety assessments must be submitted for 
        approval by manufacturers in each year.
            ``(3) Basis of assessment.--The safety assessment of an 
        ingredient, constituents, substance, or compound described in 
        paragraphs (1) and (2) shall--
                    ``(A) be based on the best scientific evidence 
                available at the time of the submission of the 
                assessment; and
                    ``(B) result in a finding that there is a 
                reasonable certainty in the minds of competent 
                scientists that the ingredient, constituents, 
                substance, or compound is not harmful in the quantities 
                used under the intended conditions of use.
    ``(c) Prohibition.--
            ``(1) Regulations.--Not later than 12 months after the date 
        of enactment of this chapter, the Secretary shall promulgate 
        regulations to prohibit the use of any ingredient, constituent, 
        substance, or compound in the tobacco product of a 
        manufacturer--
                    ``(A) if no safety assessment has been submitted by 
                the manufacturer for the ingredient, constituent, 
                substance, or compound as otherwise required under this 
                section;
                    ``(B) if the Secretary disapproves of the safety of 
                the ingredient, constituent, substance, or compound 
                that was the subject of the assessment under paragraph 
                (2); or
                    ``(C) if such ingredient, constituent, substance, 
                or compound is a new ingredient that has not been 
                approved for use by the Secretary.
            ``(2) Review of assessments.--
                    ``(A) General review.--Not later than 180 days 
                after the receipt of a safety assessment under 
                subsection (b), the Secretary shall review the findings 
                contained in such assessment and approve or disapprove 
                of the safety of the ingredient, constituents, 
                substance, or compound that was the subject of the 
                assessment. The Secretary may, for good cause, extend 
                the period for such approval. The Secretary shall 
                provide notice to the manufacturer of an action under 
                this subparagraph.
                    ``(B) Inaction by secretary.--If the Secretary 
                fails to act with respect to an assessment of an 
                existing ingredient, constituent, substance, or 
                additive during the period referred to in subparagraph 
                (A), the manufacturer of the tobacco product involved 
                may continue to use the ingredient, constituents, 
                substance, or compound involved until such time as the 
                Secretary makes a determination with respect to the 
                assessment.
    ``(d) Disclosure of Ingredients to the Public.--
            ``(1) Initial disclosure.--The regulations promulgated in 
        accordance with section 904(a) shall, at a minimum, require 
        that a tobacco product be deemed to be misbranded if the 
        labeling of the package of such product does not disclose all 
        ingredients, constituents, substances, or compounds contained 
        in the product in accordance with regulations promulgated by 
        the Secretary.
            ``(2) Disclosure of percentage of domestic and foreign 
        tobacco.--The regulations referred to in paragraph (1) shall, 
        at a minimum, require that a tobacco product be deemed to be 
        misbranded if the labeling of the package of such product does 
        not disclose, with respect to the tobacco contained in the 
        product--
                    ``(A) the percentage that is domestic tobacco; and
                    ``(B) the percentage that is foreign tobacco.
    ``(e) Confidentiality.--
            ``(1) Petition by manufacturer.--Upon the submission of a 
        list under subsection (a), a manufacturer may petition the 
        Secretary to exempt certain ingredients, constituents, 
        substances, or compounds on such list from public disclosure 
        under subsection (e) on the basis that such information should 
        be considered confidential as a trade secret. Such petition may 
        be accompanied by such data as the manufacturer elects to 
        submit.
            ``(2) Determination.--Not later than 60 days after 
        receiving a petition under paragraph (1), the Secretary, in 
        consultation with the Attorney General, shall make a 
        determination with respect to whether the information described 
        in the petition should be exempt from disclosure under 
        paragraph (1) as a trade secret. The Secretary shall provide 
        the manufacturer involved with notice of such determination. 
        but the decision of the Secretary shall be final.
            ``(3) Procedures for confidential information.--The 
        Secretary shall develop procedures to maintain the 
        confidentiality of information that is treated as a trade 
        secret under a determination under paragraph (2). Such 
        procedures shall include--
                    ``(A) a requirement that such information be 
                maintained in a secure facility; and
                    ``(B) a requirement that only the Secretary, or the 
                authorized agents of the Secretary, will have access to 
                the information and shall be instructed to maintain the 
                confidentiality of such information.
            ``(4) Health disclosure.--Notwithstanding a determination 
        under paragraph (2), the Secretary may require that any 
        ingredient, constituents, substance, or compound contained in a 
        tobacco product that is determined to be exempt from disclosure 
        as a trade secret be disclosed if the Secretary determines that 
        such ingredient, constituents, substance, or compound is not 
        safe as provided for in subsection (d).
            ``(5) Other disclosure.--Any information that the Secretary 
        determines is not subject to disclosure to the public under 
        this subsection, shall be exempt from disclosure pursuant to 
        subsection (a) of section 552 of title 5, United States Code, 
        by reason of subsection (b)(4) of such section, and shall be 
        considered confidential and shall not be disclosed, except that 
        such information may be disclosed to other officers or 
        employees as provided for in paragraph (3)(B) or when relevant 
        in any proceeding under this Act.

``SEC. 910. TOBACCO PRODUCT WARNINGS, LABELING AND PACKAGING.

    ``(a) Cigarette Warnings.--
            ``(1) In general.--
                    ``(A) Packaging.--It shall be unlawful for any 
                person to manufacture, package, or import for sale or 
                distribution within the United States any cigarettes 
                the package of which fails to bear, in accordance with 
                the requirements of this subsection, one of the 
                following labels:
                        ``WARNING: Cigarettes Are Addictive.
                        ``WARNING: Tobacco Smoke Can Harm Your 
                        Children.
                        ``WARNING: Cigarettes Cause Fatal Lung Disease.
                        ``WARNING: Cigarettes Cause Cancer.
                        ``WARNING: Cigarettes Cause Strokes And Heart 
                        Disease.
                        ``WARNING: Smoking During Pregnancy Can Harm 
                        Your Baby.
                        ``WARNING: Smoking Can Kill You.
                        ``WARNING: Tobacco Smoke Causes Fatal Lung 
                        Disease In Nonsmokers.
                        ``WARNING: Quitting Smoking Now Greatly Reduces 
                        Serious Risks To Your Health.
                    ``(B) Advertising.--It shall be unlawful for any 
                manufacturer or importer of cigarettes to advertise or 
                cause to be advertised within the United States any 
                cigarette unless the advertising bears, in accordance 
                with the requirements of this subsection, one of the 
                following labels:
                        ``WARNING: Cigarettes Are Addictive.
                        ``WARNING: Tobacco Smoke Can Harm Your 
                        Children.
                        ``WARNING: Cigarettes Cause Fatal Lung Disease.
                        ``WARNING: Cigarettes Cause Cancer.
                        ``WARNING: Cigarettes Cause Strokes And Heart 
                        Disease.
                        ``WARNING: Smoking During Pregnancy Can Harm 
                        Your Baby.
                        ``WARNING: Smoking Can Kill You.
                        ``WARNING: Tobacco Smoke Causes Fatal Lung 
                        Disease In Nonsmokers.
                        ``WARNING: Quitting Smoking Now Greatly Reduces 
                        Serious Risks To Your Health.
            ``(2) Requirements for labeling.--
                    ``(A) Location.--Each label statement required by 
                subparagraph (A) of paragraph (1) shall be located on 
                the upper portion of the front panel of the cigarette 
                package (or carton) and occupy not less than 25 percent 
                of such front panel.
                    ``(B) Type and color.--With respect to each label 
                statement required by subparagraph (A) of paragraph 
                (1), the phrase `WARNING' shall appear in capital 
                letters and the label statement shall be printed in 17 
                point type with adjustments as determined appropriate 
                by the Secretary to reflect the length of the required 
                statement. All the letters in the label shall appear in 
                conspicuous and legible type, in contrast by 
                typography, layout, or color with all other printed 
                material on the package, and be printed in an 
                alternating black-on-white and white-on-black format as 
                determined appropriate by the Secretary.
                    ``(C) Exception.--The provisions of subparagraph 
                (A) shall not apply in the case of a flip-top cigarette 
                package (offered for sale on June 1, 1997) where the 
                front portion of the flip-top does not comprise at 
                least 25 percent of the front panel. In the case of 
                such a package, the label statement required by 
                subparagraph (A) of paragraph (1) shall occupy the 
                entire front portion of the flip-top.
            ``(3) Requirements for advertising.--
                    ``(A) Location.--Each label statement required by 
                subparagraph (B) of paragraph (1) shall occupy not less 
                than 20 percent of the area of the advertisement 
                involved.
                    ``(B) Type and color.--
                            ``(i) Type.--With respect to each label 
                        statement required by subparagraph (B) of 
                        paragraph (1), the phrase `WARNING' shall 
                        appear in capital letters and the label 
                        statement shall be printed in the following 
                        types:
                                    ``(I) With respect to whole page 
                                advertisements on broadsheet 
                                newspaper--45 point type.
                                    ``(II) With respect to half page 
                                advertisements on broadsheet 
                                newspaper--39 point type.
                                    ``(III) With respect to whole page 
                                advertisements on tabloid newspaper--39 
                                point type.
                                    ``(IV) With respect to half page 
                                advertisements on tabloid newspaper--27 
                                point type.
                                    ``(V) With respect to DPS magazine 
                                advertisements--31.5 point type.
                                    ``(VI) With respect to whole page 
                                magazine advertisements--31.5 point 
                                type.
                                    ``(VII) With respect to 28cm x 3 
                                column advertisements--22.5 point type.
                                    ``(VIII) With respect to 20cm x 2 
                                column advertisements--15 point type.
                        The Secretary may revise the required type 
                        sizes as the Secretary determines appropriate 
                        within the 20 percent requirement.
                            ``(ii) Color.--All the letters in the label 
                        under this subparagraph shall appear in 
                        conspicuous and legible type, in contrast by 
                        typography, layout, or color with all other 
                        printed material on the package, and be printed 
in an alternating black-on-white and white-on-black format as 
determined appropriate by the Secretary.
            ``(4) Rotation of label statements.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the label statements specified in 
                subparagraphs (A) and (B) of paragraph (1) shall be 
                rotated by each manufacturer or importer of cigarettes 
                quarterly in alternating sequence on packages of each 
                brand of cigarettes manufactured by the manufacturer or 
                importer and in the advertisements for each such brand 
                of cigarettes in accordance with a plan submitted by 
                the manufacturer or importer and approved by the 
                Secretary. The Secretary shall approve a plan submitted 
                by a manufacturer or importer of cigarettes which will 
                provide the rotation required by this paragraph and 
                which assures that all of the labels required by 
                subparagraphs (A) and (B) will be displayed by the 
                manufacturer or importer at the same time.
                    ``(B) Application of other rotation requirements.--
                            ``(i) In general.--A manufacturer or 
                        importer of cigarettes may apply to the 
                        Secretary to have the label rotation described 
                        in clause (iii) apply with respect to a brand 
                        style of cigarettes manufactured or imported by 
                        such manufacturer or importer if--
                                    ``(I) the number of cigarettes of 
                                such brand style sold in the fiscal 
                                year of the manufacturer or importer 
                                preceding the submission of the 
                                application is less than \1/4\ of 1 
                                percent of all the cigarettes sold in 
                                the United States in such year; and
                                    ``(II) more than \1/2\ of the 
                                cigarettes manufactured or imported by 
                                such manufacturer or importer for sale 
                                in the United States are packaged into 
                                brand styles which meet the 
                                requirements of subclause (I).
                        If an application is approved by the Secretary, 
                        the label rotation described in clause (iii) 
                        shall apply with respect to the applicant 
                        during the 1-year period beginning on the date 
                        of the application approval.
                            ``(ii) Plan.--An applicant under clause (i) 
                        shall include in its application a plan under 
                        which the label statements specified in 
                        subparagraph (A) of paragraph (1) will be 
                        rotated by the applicant manufacturer or 
                        importer in accordance with the label rotation 
                        described in clause (iii).
                            ``(iii) Other rotation requirements.--Under 
                        the label rotation which the manufacturer or 
                        importer with an approved application may put 
                        into effect, each of the labels specified in 
                        subparagraph (A) of paragraph (1) shall appear 
                        on the packages of each brand style of 
                        cigarettes with respect to which the 
                        application was approved an equal number of 
                        times within the 12-month period beginning on 
                        the date of the approval by the Secretary of 
                        the application.
            ``(5) Application of requirement.--Paragraph (1) does not 
        apply to a distributor, a retailer of cigarettes who does not 
        manufacture, package, or import cigarettes for sale or 
        distribution within the United States.
            ``(6) Television and radio advertising.--It shall be 
        unlawful to advertise cigarettes and little cigars on any 
        medium of electronic communications subject to the jurisdiction 
        of the Federal Communications Commission.
    ``(b) Smokeless Tobacco Products.--
            ``(1) In general.--
                    ``(A) Packaging.--It shall be unlawful for any 
                person to manufacture, package, or import for sale or 
                distribution within the United States any smokeless 
                tobacco product the package of which fails to bear, in 
                accordance with the requirements of this subsection, 
                one of the following labels:
                        ``WARNING: This Product Can Cause Mouth Cancer.
                        ``WARNING: This Product Can Kill You.
                        ``WARNING: This Product Can Cause Gum Disease 
                        And Tooth Loss.
                        ``WARNING: This Product Is Not A Safe 
                        Alternative To Cigarettes.
                        ``WARNING: This Product Contains Cancer-Causing 
                        Chemicals.
                        ``WARNING: Smokeless Tobacco Is Addictive.
                    ``(B) Advertising.--It shall be unlawful for any 
                manufacturer or importer of smokeless tobacco products 
                to advertise or cause to be advertised within the 
                United States any smokeless tobacco product unless the 
                advertising bears, in accordance with the requirements 
                of this subsection, one of the following labels:
                        ``WARNING: This Product Can Cause Mouth Cancer.
                        ``WARNING: This Product Can Kill You.
                        ``WARNING: This Product Can Cause Gum Disease 
                        And Tooth Loss.
                        ``WARNING: This Product Is Not A Safe 
                        Alternative To Cigarettes.
                        ``WARNING: This Product Contains Cancer-Causing 
                        Chemicals.
                        ``WARNING: Smokeless Tobacco Is Addictive.
            ``(2) Requirements for labeling.--
                    ``(A) Location.--Each label statement required by 
                subparagraph (A) of paragraph (1) shall be located on 
                the principal display panel of the product and occupy 
                not less than 25 percent of such panel.
                    ``(B) Type and color.--With respect to each label 
                statement required by subparagraph (A) of paragraph 
                (1), the phrase `WARNING' shall appear in capital 
                letters and the label statement shall be printed in 17 
                point type with adjustments as determined appropriate 
                by the Secretary to reflect the length of the required 
                statement. All the letters in the label shall appear in 
                conspicuous and legible type in contrast by typography, 
                layout, or color with all other printed material on the 
                package and be printed in an alternating black on white 
                and white on black format as determined appropriate by 
                the Secretary.
            ``(3) Advertising and rotation.--The provisions of 
        paragraph (3) and (4)(A) of subsection (a) shall apply to 
        advertisements for smokeless tobacco products and the rotation 
        of the label statements required under paragraph (1)(A) on such 
        products.
            ``(4) Application of requirement.--Paragraph (1) does not 
        apply to a distributor or a retailer of smokeless tobacco 
        products who does not manufacture, package, or import such 
        products for sale or distribution within the United States.
            ``(5) Television and radio advertising.--It shall be 
        unlawful to advertise smokeless tobacco on any medium of 
        electronic communications subject to the jurisdiction of the 
        Federal Communications Commission.
    ``(c) Enforcement.--Not later than 180 days after the date of the 
enactment of this title, the Secretary shall promulgate such 
regulations as may be necessary to enforce subsections (a) and (b).
    ``(d) Injunctions.--The several district courts of the United 
States are vested with jurisdiction, for cause shown, to prevent and 
restrain violations of this section upon the application of the 
Secretary in the case of a violation of subsection (a) or (b).
    ``(e) Construction.--
            ``(1) In general.--Noting in this section shall be 
        construed to limit the ability of the Secretary the change the 
        text or layout of any of the warning statements, or any of the 
        labeling provisions, under subsections (a) and (b), if 
        determined necessary by the Secretary.
            ``(2) Unfair acts.--Nothing in this section (other than the 
        requirements of subsections (a) and (b)) shall be construed to 
        limit or restrict the authority of the Secretary with respect 
        to unfair or deceptive acts or practices in the advertising of 
        cigarettes or smokeless tobacco products.
    ``(f) Limited Preemption.--
            ``(1) State and local action.--
                    ``(A) Limitation.--No warning label with respect to 
                cigarettes or smokeless tobacco products, other than 
                the warning labels required by subsections (a) and (b), 
                shall be required by any State or local statute or 
                regulation to be included on any package or in any 
                advertisement of cigarettes or a smokeless tobacco 
                product.
                    ``(B) Rule of construction.--Nothing in this 
                section shall be construed as prohibiting a State or 
                political subdivision of a State from enacting statutes 
                or regulations concerning cigarettes or smokeless 
                tobacco products so long as such statutes or 
                regulations do not conflict with the labeling and 
                advertising requirements of this section or require 
                additional statements on cigarette or smokeless tobacco 
                packages.
            ``(2) Effect on Liability Law.--Except as otherwise 
        provided in this section, nothing in this section shall relieve 
        any person from liability at common law or under State 
        statutory law to any other person.
    ``(g) Reports.--Not later than 1 year after the date of enactment 
of this chapter, and biennially thereafter, the Secretary shall prepare 
and submit to Congress a report containing--
            ``(1) a description of the effects of health education 
        efforts on the use of cigarettes and smokeless tobacco 
        products;
            ``(2) a description of the use by the public of cigarettes 
        and smokeless tobacco products;
            ``(3) an evaluation of the health effects of cigarettes and 
        smokeless tobacco products and the identification of areas 
        appropriate for further research; and
            ``(4) such recommendations for legislation and 
        administrative action as the Secretary considers appropriate.
    ``(h) Exports.--Packages of cigarettes or smokeless tobacco 
products manufactured, imported, or packaged--
            ``(1) for export from the United States; or
            ``(2) for delivery to a vessel or aircraft, as supplies, 
        for consumption beyond the jurisdiction of the internal revenue 
        laws of the United States;
shall be exempt from the requirements of this chapter, but such 
exemptions shall not apply to cigarettes or smokeless tobacco products 
manufactured, imported, or packaged for sale or distribution to members 
or units of the Armed Forces of the United States located outside of 
the United States.
    ``(i) Application.--The Secretary shall exercise the authority 
provided for in this section notwithstanding the provisions of the 
Federal Cigarette Labeling and Advertising Act (15 U.S.C. 1331 et seq.) 
and the Comprehensive Smokeless Tobacco Health Education Act of 1986 
(15 U.S.C. 4401 et seq.).

``SEC. 911. STATEMENT OF INTENDED USE.

    ``(a) Requirement.--Each manufacturer, distributor, and retailer 
advertising or causing to be advertised, disseminating or causing to be 
disseminated, advertising concerning cigarettes, cigarette tobacco, or 
smokeless tobacco products otherwise permitted under this chapter shall 
include, as provided in section 502, the established name of the 
product and a statement of the intended use of the product as provided 
for in subsection (b).
    ``(b) Use Statements.--
            ``(1) Cigarettes.--A statement of intended use for 
        cigarettes or cigarette tobacco is as follows (whichever is 
        appropriate):
                ``Cigarettes--A Nicotine-Delivery Device for Persons 18 
                or Older.
                ``Cigarette Tobacco--A Nicotine-Delivery Device for 
                Persons 18 or Older.
            ``(2) Smokeless tobacco.--A statement of intended use for a 
        smokeless tobacco product is as follows (whichever is 
        appropriate):
                ``Loose Leaf Chewing Tobacco--A Nicotine-Delivery 
                Device for Persons 18 or Older.
                ``Plug Chewing Tobacco--A Nicotine-Delivery Device for 
                Persons 18 or Older.
                ``Twist Chewing Tobacco--A Nicotine-Delivery Device for 
                Persons 18 or Older.
                ``Moist Snuff--A Nicotine-Delivery Device for Persons 
                18 or Older.
                ``Dry Snuff--A Nicotine-Delivery Device for Persons 18 
                or Older.
    ``(c) Type and Location.--The Secretary shall promulgate 
regulations with respect to the type, color, size, and placement of 
statements required under this section on labels and in advertisements.

``SEC. 912. MISCELLANEOUS PROVISIONS.

    ``(a) Preservation of State and Local Authority.--Except as 
otherwise provided for in this chapter, nothing in this chapter shall 
be construed as prohibiting a State from imposing requirements, 
prohibitions, penalties or other measures to further the purposes of 
this chapter that are in addition to the requirements, prohibitions, or 
penalties required under this chapter. To the extent not inconsistent 
with the purposes of this chapter, State and local governments may 
impose additional tobacco product control measures to further restrict 
or limit the use of such products by minors.
    ``(b) Regulations.--The Secretary may promulgate regulations to 
enforce the provisions of this chapter, or to modify, alter, or expand 
the requirements and protections provided for in this chapter if the 
Secretary determines that such modifications, alternations, or 
expansion is necessary.''.

  TITLE III--STANDARDS TO REDUCE INVOLUNTARY EXPOSURE TO TOBACCO SMOKE

SEC. 301. STANDARDS TO REDUCE INVOLUNTARY EXPOSURE TO TOBACCO SMOKE.

    The Occupational Safety and Health Act of 1970 (29 U.S.C. 651 et 
seq.) is amended by adding at the end the following:

``SEC. 35. STANDARDS TO REDUCE INVOLUNTARY EXPOSURE TO TOBACCO SMOKE.

    ``(a) Definitions.--In this section--
            ``(1) Public facility.--
                    ``(A) In general.--The term `public facility' means 
                any building regularly entered by 10 or more 
                individuals at least 1 day per week, including any such 
                building owned by or leased to a Federal, State, or 
                local government entity. Such term shall not include 
                any building or portion thereof regularly used for 
                residential purposes.
                    ``(B) Exclusions.--The term `public facility' does 
                not include a portion of a building which is used as a 
                bar, tobacco merchant, a hotel guest room that is 
                designated as a smoking room, or prison.
            ``(2) Responsible entity.--The term `responsible entity' 
        means, with respect to any public facility, the owner of such 
        facility except that, in the case of any such facility or 
        portion thereof which is leased, such term means the lessee.
    ``(b) Smoke-Free Environment Policy.--
            ``(1) Policy required.--In order to protect children and 
        adults from cancer, respiratory disease, heart disease, and 
        other adverse health effects from breathing environmental 
        tobacco smoke, the responsible entity for each public facility 
        shall adopt and implement at such facility a smoke-free 
        environment policy which meets the requirements of paragraph 
        (2) or (4).
            ``(2) Elements of policy.--
                    ``(A) In general.--Each smoke-free environment 
                policy for a public facility shall--
                            ``(i) prohibit the smoking of cigarettes, 
                        cigars, and pipes, and any other combustion of 
                        tobacco within the facility and on facility 
                        property within the immediate vicinity of the 
                        entrance to the facility; and
                            ``(ii) post a clear and prominent notice of 
                        the smoking prohibition in appropriate and 
                        visible locations at the public facility.
                    ``(B) Exception.--The smoke-free environment policy 
                for a public facility may provide an exception to the 
                prohibition specified in subparagraph (A) for 1 or more 
                specially designated smoking areas within a public 
                facility if such area or areas meet the requirements of 
                paragraph (3).
            ``(3) Specially designated smoking areas.--A specially 
        designated smoking area meets the requirements of this 
        subsection if--
                    ``(A) the area is ventilated in accordance with 
                specifications promulgated by the Secretary of Labor 
                that ensure that air from the area is directly 
                exhausted to the outside and does not recirculate or 
                drift to other areas within the public facility;
                    ``(B) the area is maintained at negative pressure, 
                as compared to adjoined nonsmoking areas, as determined 
                under regulations promulgated by the Secretary of 
                Labor; and
                    ``(C) nonsmoking individuals do not have to enter 
                the area for any purpose while smoking is occurring in 
                such area.
        Cleaning and maintenance work shall be conducted in such area 
        only while no smoking is occurring in the area.
            ``(4) Special rules.--
                    ``(A) Schools and other facilities serving 
                children.--
                            ``(i) In general.--With respect to a 
                        facility described in clause (ii), the 
                        responsible entity for the facility shall adopt 
                        and implement at such facility a smoke-free 
                        environment policy that--
                                    ``(I) prohibits the smoking of 
                                cigarettes, cigars, and pipes, and any 
                                other combustion of tobacco within the 
                                facility and on facility property;
                                    ``(II) prohibits the use of 
                                smokeless tobacco products within the 
                                facility and on facility property; and
                                    ``(III) post a clear and prominent 
                                notice of the smoking and smokeless 
                                tobacco prohibition in appropriate and 
                                visible locations at the public 
                                facility.
                            ``(ii) Facility.--A facility described in 
                        this clause is--
                                    ``(I) an elementary or secondary 
                                school (as such term is defined in 
                                section 14101 of the Elementary and 
                                Secondary Education Act of 1965 (20 
                                U.S.C. 8801);
                                    ``(II) any facility at which a Head 
                                Start program or project is being 
                                carried out under the Head Start Act 
                                (42 U.S.C. 9831 et seq.);
                                    ``(III) any facility at which a 
                                licensed or certified child care 
                                provider provides child care services; 
                                and
                                    ``(IV) any recreation or other 
                                facility maintained primarily to 
                                provide services to children as 
                                determined by the Secretary of Labor.
                    ``(B) Public transportation.--With respect to any 
                responsible entity which operates conveyances of public 
                transportation (including bus, rail, aircraft, boat, or 
                any other conveyance determined appropriate by the 
                Secretary of Labor), the responsible entity shall adopt 
                and implement on such conveyances a smoke-free 
                environment policy that--
                            ``(i) prohibits the smoking of cigarettes, 
                        cigars, and pipes, and any other combustion of 
                        tobacco within the conveyance and on property 
                        affiliated with the conveyance; and
                            ``(ii) post a clear and prominent notice of 
                        the smoking prohibition in appropriate and 
                        visible locations on the conveyance.
    ``(c) Enforcement.--To be eligible to receive funds under title 
XXVIII of the Public Health Service Act, a State shall have in effect 
laws or procedures to provide for the enforcement of this section 
within the State. Such laws or procedures shall permit aggrieved 
individuals to enforce this section through administrative or judicial 
means.
    ``(d) Preemption.--Nothing in this section shall preempt or 
otherwise affect any other Federal, State or local law which provides 
protection from health hazards from environmental tobacco smoke that 
are as least as stringent as those provided for in this section.
    ``(e) Regulations.--The Secretary of Labor is authorized to 
promulgate such regulations as the Secretary deems necessary to carry 
out this section.
    ``(f) Effective Date.--The provisions of this section shall take 
effect on the date that is 1 year after the date of enactment of this 
section.''.

             TITLE IV--TOBACCO MARKET TRANSITION ASSISTANCE

SEC. 401. DEFINITIONS.

    In this title:
            (1) Buyout payment.--The term ``buyout payment'' means a 
        payment made under section 411, 412, or 413.
            (2) Contract.--The term ``contract'' means a contract 
        entered into under section 411, 412, or 413.
            (3) Lease.--The term ``lease'' means a rental of quota on 
        either a cash rent or crop share basis.
            (4) Marketing year.--The term ``marketing year'' means--
                    (A) in the case of Flue-cured tobacco, the period 
                beginning July 1 and ending the following June 30; and
                    (B) in the case of each other kind of tobacco, the 
                period beginning October 1 and ending the following 
                September 30.
            (5) Quota owner.--The term ``quota owner'' means a person 
        that, at the time of entering into a contract, owns quota 
        provided by the Secretary.
            (6) Producer of quota.--The term ``producer of quota'' 
        means a person that during at least 3 of the 1993 through 1997 
        crops of tobacco (as determined by the Secretary) that were 
        subject to quota--
                    (A) leased quota;
                    (B) shared in the risk of producing a crop of 
                tobacco; and
                    (C) marketed the tobacco subject to quota.
            (7) Producer of non-tobacco quota.--The term ``producer of 
        non-tobacco quota'' means a person that during at least 1 of 
        the crop years 1995 through 1997 grew and marketed tobacco not 
        subject to quota.
            (8) Quota.--The term ``quota'' means basic marketing quota 
        for tobacco determined by the Secretary under the Agricultural 
        Adjustment Act of 1938 (7 U.S.C. 1281 et seq.).
            (9) Quota holder.--The term ``quota holder'' means a 
        producer that owns a farm for which a tobacco farm marketing 
        quota or farm acreage allotment was established under the 
        Agricultural Adjustment Act of 1938 (7 U.S.C. 1281 et seq.) for 
        any of the 1994, 1995, or 1996 crop years.
            (10) Quota lessee.--The term ``quota lessee'' means--
                    (A) a producer that owns a farm that produced 
                tobacco pursuant to a lease and transfer to that farm 
                of all or part of a tobacco farm marketing quota or 
                farm acreage allotment established under the 
                Agricultural Adjustment Act of 1938 (7 U.S.C. 1281 et 
                seq.) for any of the 1994, 1995, or 1996 crop years; or
                    (B) a producer that rented land from a farm 
                operator to produce tobacco under a tobacco farm 
                marketing quota or farm acreage allotment established 
                under the Agricultural Adjustment Act of 1938 (7 U.S.C. 
                1281 et seq.) for any of the 1994, 1995, or 1996 crop 
                years.
            (11) Quota tenant.--The term ``quota tenant'' means a 
        producer that--
                    (A) is the principal producer, as determined by the 
                Secretary, of tobacco on a farm where tobacco is 
                produced pursuant to a tobacco farm marketing quota or 
                farm acreage allotment established under the 
                Agricultural Adjustment Act of 1938 (7 U.S.C. 1281 et 
                seq.) for any of the 1994, 1995, or 1996 crop years; 
                and
                    (B) is not a quota holder or quota lessee.
            (12) Secretary.--In subtitles A and C, the term 
        ``Secretary'' means the Secretary of Agriculture.
            (13) State.--The term ``State'' means each of the several 
        States of the United States, the District of Columbia, the 
        Commonwealth of Puerto Rico, and any other territory or 
        possession of the United States.
            (14) Tobacco.--The term ``tobacco'' means any kind of 
        tobacco produced and marketed in the United States.
            (15) Tobacco-growing state.--The term ``tobacco-growing 
        State'' means Georgia, Kentucky, North Carolina, South 
        Carolina, Tennessee, or Virginia.
            (16) Transition payment.--The term ``transition payment'' 
        means a payment made to a producer under section 411, 412, or 
        413.
            (17) United states.--The term ``United States'', when used 
        in a geographical sense, means all of the States.

  Subtitle A--Tobacco Quota Buyout Contracts and Producer Transition 
                                Payments

SEC. 411. QUOTA OWNER BUYOUT CONTRACTS.

    (a) Offer.--The Secretary shall offer to enter into a quota buyout 
contract with the quota owner on each farm to which a quota was 
assigned in 1997.
    (b) Terms.--
            (1) Relinquishment of quota.--Under the terms of the 
        contract, the owner shall agree, in exchange for a buyout 
        payment, to permanently relinquish the quota.
            (2) Eligibility for tobacco program benefits.--Neither the 
        farm, in its current or future ownership configuration, nor the 
        contracting owner shall be eligible for any tobacco program 
        benefits under the Agricultural Adjustment Act of 1938 (7 
        U.S.C. 1281 et seq.), or the Agricultural Act of 1949 (7 U.S.C. 
        1421 et seq.).
    (c) Payment Calculation.--The total amount of the buyout payment 
made to a quota owner shall be determined by multiplying--
            (1) $4; by
            (2) the average quantity of basic quota assigned to the 
        farm during the period 1995 through 1997.

SEC. 412. PRODUCER TRANSITION PAYMENTS FOR QUOTA TOBACCO.

    (a) Offer.--The Secretary shall offer to producers of quota tobacco 
that do not own the quota, but were quota lessees or quota tenants in 
1997, producer transition payment contracts.
    (b) Terms.--Under the terms of the transition contract, the 
producer shall agree, in exchange for a payment, to permanently refrain 
from growing tobacco for which a quota program is in effect.
    (c) Payment Calculation.--The total amount of the transition 
payment made to a producer shall be determined by multiplying--
            (1) $4; by
            (2) the average quantity of quota tobacco leased or rented 
        from quota owners during the period 1995 through 1997.

SEC. 413. PRODUCER TRANSITION PAYMENTS FOR NON-QUOTA TOBACCO.

    (a) Offer.--The Secretary shall offer to producers of nonquota 
tobacco a producer nonquota transition payment contract.
    (b) Terms.--Under the terms of the transition payment, the producer 
shall agree, in exchange for a payment, to permanently refrain from 
growing tobacco for which a quota program is in effect.
    (c) Payment Calculation.--The total amount of the transition 
payment made to a producer shall be determined by multiplying--
            (1) $4; by
            (2) the average annual quantity of nonquota tobacco 
        marketed during the period 1995 through 1997.

SEC. 414. ELEMENTS OF CONTRACTS.

    (a) Commencement.--To the maximum extent practicable, the Secretary 
shall commence entering into contracts under this subtitle not later 
than 90 days after the date of enactment of this Act.
    (b) Deadline.--The Secretary may not enter into a contract under 
this subtitle after the date that is 3 years after the date of 
enactment of this Act.
    (c) Beginning Date.--A contract under this subtitle shall take 
effect and become binding beginning in the tobacco marketing year 
following the year in which the contract is entered into.
    (d) Time for Payment.--A contract payment shall be made not later 
than the date that is the beginning of the marketing year in which the 
contract becomes binding, or at any later time selected by the quota 
owner or producer.
    (e) Prohibition of Double Payments.--In no case shall a contract 
holder receive overlapping payments as a quota owner and as a producer 
on the same tobacco.

                Subtitle B--No Net Cost Tobacco Program

SEC. 421. BUDGET DEFICIT ASSESSMENT.

    Section 106(g)(1) of the Agricultural Act of 1949 (7 U.S.C. 
1445(g)(1)) is amended--
            (1) by striking ``only for each of the 1994 through 1998 
        crops'' and inserting ``for the 1998 and each subsequent 
        crop''; and
            (2) by striking ``equal to--'' and all that follows and 
        inserting ``equal to 1 or more amounts determined by the 
        Secretary that are sufficient to cover the costs of the 
        administration of the tobacco quota and price support programs 
        administered by the Secretary.''.

         Subtitle C--Tobacco Community Empowerment Block Grants

SEC. 431. TOBACCO COMMUNITY EMPOWERMENT BLOCK GRANTS.

    (a) Authority.--The Secretary shall make grants to tobacco States 
in accordance with this section to enable the States to--
            (1) empower active tobacco producers and tobacco product 
        manufacturing workers by providing economic alternatives to 
        tobacco; and
            (2) carry out non-tobacco economic development initiatives 
        in tobacco communities.
    (b) Application.--To be eligible to receive payments under this 
section, a tobacco State shall prepare and submit to the Secretary an 
application at such time, in such manner, and containing such 
information as the Secretary may require, including--
            (1) a description of the activities that the State will 
        carry out using amounts received under the grant;
            (2) a designation of an appropriate State agency to 
        administer amounts received under the grant; and
            (3) a description of the steps to be taken to ensure that 
        the funds are distributed in accordance with subsection (e).
    (c) Amount of Grant.--
            (1) In general.--From the amounts available to carry out 
        this section for a fiscal year, the Secretary shall allot to 
        each tobacco State an amount that bears the same ratio to the 
        amounts available as the total income of the State derived from 
        the production of tobacco and the manufacture of tobacco 
        products during the 1994 through 1996 marketing years (as 
        determined under paragraph (2)) bears to the total income of 
        all tobacco States derived from the production of tobacco and 
        the manufacturing of tobacco products during the 1994 through 
        1996 marketing years.
            (2) Tobacco income.--For the 1994 through 1996 marketing 
        years, the Secretary shall determine the amount of income 
        derived from the production of tobacco and the manufacture of 
        tobacco products in each tobacco State and in all tobacco 
        States.
    (d) Payments.--
            (1) In general.--A tobacco State that has an application 
        approved by the Secretary under subsection (b) shall be 
        entitled to a payment under this section in an amount that is 
        equal to its allotment under subsection (c).
            (2) Form of payments.--The Secretary may make payments 
        under this section to a tobacco State in installments, and in 
        advance or by way of reimbursement, with necessary adjustments 
        on account of overpayments or underpayments, as the Secretary 
        may determine.
            (3) Reallotments.--Any portion of the allotment of a 
        tobacco State under subsection (c) that the Secretary 
        determines will not be used to carry out this section in 
        accordance with an approved State application required under 
        subsection (b), shall be reallotted by the Secretary to other 
        tobacco States in proportion to the original allotments to the 
        other States.
    (e) Use and Distribution of Funds.--
            (1) In general.--Amounts received by a tobacco State under 
        this section shall be used to carry out economic development 
        activities, including--
                    (A) rural business enterprise activities described 
                in subsections (c) and (e) of section 310B of the 
                Consolidated Farm and Rural Development Act (7 U.S.C. 
                1932);
                    (B) down payment loan assistance programs that are 
                similar to the program described in section 310E of the 
                Consolidated Farm and Rural Development Act (7 U.S.C. 
                1935);
                    (C) activities designed to help create productive 
                farm or off-farm employment in rural areas to provide a 
                more viable economic base and enhance opportunities for 
                improved incomes, living standards, and contributions 
                by rural individuals to the economic and social 
                development of tobacco communities;
                    (D) activities that expand existing infrastructure, 
                facilities, and services to capitalize on opportunities 
                to diversify economies in tobacco communities and that 
                support the development of new industries or commercial 
                ventures;
                    (E) activities by agricultural organizations that 
                provide assistance directly to active tobacco producers 
                to assist in developing other agricultural activities 
                that supplement tobacco-producing activities;
                    (F) initiatives designed to create or expand 
                locally owned value-added processing and marketing 
                operations in tobacco communities;
                    (G) technical assistance activities by persons to 
                support farmer-owned enterprises, or agriculture-based 
                rural development enterprises, of the type described in 
                section 252 or 253 of the Trade Act of 1974 (19 U.S.C. 
                2342, 2343); and
                    (H) investments in community colleges and trade 
                schools to provide skills training to active tobacco 
                producers and tobacco product manufacturing workers and 
                ensure that the off-farm sector remains vital and 
                robust.
            (2) Tobacco counties.--Assistance may be provided by a 
        tobacco State under this section only to assist a county in the 
        State that has been determined by the Secretary to have in 
        excess of $100,000 in income derived from the production of 
        tobacco and the manufacture of tobacco products during 1 or 
more of the 1994 through 1996 marketing years.
            (3) Distribution.--
                    (A) Economic development activities.--Not less than 
                20 percent of the amounts received by a tobacco State 
                under this section shall be used to carry out--
                            (i) economic development activities 
                        described in subparagraph (E) or (F) of 
                        paragraph (1); or
                            (ii) agriculture-based rural development 
                        activities described in paragraph (1)(G).
                    (B) Technical assistance activities.--Not less than 
                4 percent of the amounts received by a tobacco State 
                under this section shall be used to carry out technical 
                assistance activities described in paragraph (1)(G).
                    (C) Tobacco counties.--To be eligible to receive 
                payments under this section, a tobacco State shall 
                demonstrate to the Secretary that funding will be 
                provided, during the 1999 through 2004 fiscal years, 
                for activities in each county in the State that has 
                been determined under paragraph (2) to have in excess 
                of $100,000 in income derived from the production of 
                tobacco and the manufacture of tobacco products, in 
                amounts that are at least equal to the product obtained 
                by multiplying--
                            (i) the ratio that the tobacco production 
                        and tobacco product manufacturing income in the 
                        county determined under paragraph (2) bears to 
                        the total tobacco production and tobacco 
                        product manufacturing income for the State 
                        determined under subsection (c); by
                            (ii) 50 percent of the total amounts 
                        received by the State under this section during 
                        the 1999 through 2004 fiscal years.

                   TITLE V--MISCELLANEOUS PROVISIONS

SEC. 501. SENSE OF THE SENATE.

    It is the sense of the Senate that, in order to provide funds to 
carry out this Act, Congress should enact an increase in the excise 
taxes on tobacco products of approximately $1.50 per pack of cigarettes 
(and corresponding increases on taxes on other tobacco products) over a 
3-year period, that increases in such tax in future years should be 
indexed to inflation, and that the payment of such tax should not be 
considered to be an ordinary and necessary expense in carrying on a 
trade or business and should not be deductible.
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