II

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.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

2 (a) SHORT TITLE.—This Act may be cited as the

3 ‘‘Healthy and Smoke Free Children Act’’.

4 (b) TABLE OF CONTENTS.—The table of contents of

5 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
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‘‘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.
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1 SEC. 2. FINDINGS AND PURPOSES.

2 (a) FINDINGS.—Congress makes the following find3 ings:

4 (1) Tobacco products are the foremost prevent5 able health problem facing America today. More

6 than 400,000 individuals die each year as a result

7 of tobacco induced illnesses and conditions.

8 (2) Nicotine that is contained in tobacco prod9 ucts is extremely addictive.

10 (3) The tobacco industry has historically tar11 geted tobacco product marketing and promotional ef12 forts towards minors in order to entrap them into a

13 lifetime of smoking.

14 (4) Over 90 percent of individuals who smoke

15 began smoking regularly while they were still mi16 nors.

17 (5) Approximately 3000 minors begin smoking

18 each day. 1000 of these minors will die prematurely

19 from a tobacco induced illness or medical condition.

20 (6) Tobacco induced illnesses and medical con21 ditions resulting from tobacco use cost the United

22 States over $100,000,000,000 each year.

23 (7) Each year the Federal Government incurs

24 costs in excess of $20,000,000,000 for the medical

25 treatment of individuals suffering from tobacco in26 duced illnesses and conditions.
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1 (b) PURPOSES.—It is the purpose of this Act to—

2 (1) substantially reduce youth smoking;

3 (2) assist individuals who are currently addicted

4 to tobacco products in overcoming that addiction;

5 (3) educate the public concerning the health

6 dangers inherent in the use of tobacco products;

7 (4) fund medical research; and

8 (5) provide for the healthy development of

9 young children and to enhance their learning capac10 ity and improve the quality of their care.

11 TITLE I—AMENDMENTS TO THE

12 PUBLIC HEALTH SERVICE

13 ACT RELATING TO TOBACCO

14 SEC. 101. PUBLIC HEALTH AND EDUCATION PROGRAMS.

15 The Public Health Service Act (42 U.S.C. 201 et

16 seq.) is amended by adding at the end thereof the follow17 ing new title:

18 ‘‘TITLE XXVIII—PUBLIC HEALTH

19 AND EDUCATION PROGRAMS

20 AND TOBACCO CONTROL

21 ‘‘SEC. 2801. DEFINITIONS.

22 ‘‘In this title:

23 ‘‘(1) BRAND.—The term ‘brand’ means a vari24 ety of a tobacco product distinguished by the tobacco
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1 used, tar content, nicotine content, flavoring used,

2 size, filtration, or packaging.

3 ‘‘(2) CIGAR.—The term ‘cigar’ means any roll

4 of tobacco wrapped in leaf tobacco or in any sub5 stance containing tobacco (other than any roll of to6 bacco which is a cigarette or cigarillo within the

7 meaning of paragraph (3) or (4)).

8 ‘‘(3) CIGARETTE.—The term ‘cigarette’ means

9 any product which contains nicotine, is intended to

10 be burned under ordinary conditions of use, and con11 sists of—

12 ‘‘(A) any roll of tobacco wrapped in paper

13 or in any substance not containing tobacco; and

14 ‘‘(B) any roll of tobacco wrapped in any

15 substance containing tobacco which, because of

16 its appearance, the type of tobacco used in the

17 filler, or its packaging and labeling, is likely to

18 be offered to, or purchased by, consumers as a

19 cigarette described in subparagraph (A).

20 ‘‘(4) CIGARILLOS.—The term ‘cigarillos’ means

21 any roll of tobacco wrapped in leaf tobacco or any

22 substance containing tobacco (other than any roll of

23 tobacco which is a cigarette within the meaning of

24 paragraph (3)) and as to which 1,000 units weigh

25 not more than 3 pounds.
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1 ‘‘(5) CIGARETTE TOBACCO.—The term ‘ciga2 rette tobacco’ means any product that consists of

3 loose tobacco that contains or delivers nicotine and

4 is intended for use by persons in a cigarette. Unless

5 otherwise stated, the requirements of this title per6 taining to cigarettes shall also apply to cigarette to7 bacco.

8 ‘‘(6) COMMERCE.—The term ‘commerce’

9 means—

10 ‘‘(A) commerce between any State, the

11 District of Columbia, the Commonwealth of

12 Puerto Rico, Guam, the Virgin Islands, Amer13 ican Samoa, the Northern Mariana Islands or

14 any territory or possession of the United States;

15 ‘‘(B) commerce between points in any

16 State, the District of Columbia, the Common17 wealth of Puerto Rico, Guam, the Virgin Is18 lands, American Samoa, the Northern Mariana

19 Islands or any territory or possession of the

20 United States; or

21 ‘‘(C) commerce wholly within the District

22 of Columbia, Guam, the Virgin Islands, Amer23 ican Samoa, the Northern Mariana Islands, or

24 any territory or possession of the United States.
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1 ‘‘(7) COMMISSIONER.—The term ‘Commis2 sioner’ means the Commissioner of Food and Drugs.

3 ‘‘(8) DISTRIBUTOR.—The term ‘distributor’

4 means any person who furthers the distribution of

5 tobacco products, whether domestic or imported, at

6 any point from the original place of manufacture to

7 the person who sells or distributes the product to in8 dividuals for personal consumption. Such term shall

9 not include common carriers.

10 ‘‘(9) LITTLE CIGAR.—The term ‘little cigar’

11 means any roll of tobacco wrapped in leaf tobacco or

12 any substance containing tobacco (other than any

13 roll of tobacco which is a cigarette within the mean14 ing of subsection (1)) and as to which 1,000 units

15 weigh not more than 3 pounds.

16 ‘‘(10) MANUFACTURER.—The term ‘manufac17 turer’ means any person, including any repacker or

18 relabeler, who manufactures, fabricates, assembles,

19 processes, or labels a finished tobacco product.

20 ‘‘(11) NICOTINE.—The term ‘nicotine’ means

21 the chemical substance named 3-(1-Methyl-2-

22 pyrrolidinyl)pyridine or C10H14N2, including any salt

23 or complex of nicotine.

24 ‘‘(12) PACKAGE.—The term ‘package’ means a

25 pack, box, carton, or container of any kind in which
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1 tobacco products are offered for sale, sold, or other2 wise distributed to consumers.

3 ‘‘(13) PERSON.—The term ‘person’ means an

4 individual, partnership, corporation, or any other

5 business or legal entity.

6 ‘‘(14) PIPE TOBACCO.—The term ‘pipe tobacco’

7 means any loose tobacco that, because of its appear8 ance, type, packaging, or labeling, is likely to be of9 fered to, or purchased by, consumers as a tobacco

10 product to be smoked in a pipe.

11 ‘‘(15) POINT OF SALE.—The term ‘point of

12 sale’ means any location at which an individual can

13 purchase or otherwise obtain tobacco products for

14 personal consumption.

15 ‘‘(16) RETAILER.—The term ‘retailer’ means

16 any person who sells tobacco products to individuals

17 for personal consumption, or who operates a facility

18 where vending machines or self-service displays are

19 permitted under this title.

20 ‘‘(17) ROLL-YOUR-OWN TOBACCO.—The term

21 ‘roll-your-own tobacco’’ has the meaning given such

22 term by section 5702(p) of the Internal Revenue

23 Code of 1986.

24 ‘‘(18) SALE.—The term ‘sale’ includes the sell25 ing, providing samples of, or otherwise making to-
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1 bacco products available for personal consumption in

2 any place within the scope of this title.

3 ‘‘(19) SECRETARY.—The term ‘Secretary’

4 means the Secretary of Health and Human Services.

5 ‘‘(20) SMOKELESS TOBACCO.—The term

6 ‘smokeless tobacco’ means any product that consists

7 of cut, ground, powdered, or leaf tobacco that con8 tains nicotine and that is intended to be placed in

9 the oral or nasal cavity.

10 ‘‘(21) STATE.—The term ‘State’ includes the

11 several States, the District of Columbia, the Com12 monwealth of Puerto Rico, Guam, the Virgin Is13 lands, American Samoa, the Northern Mariana Is14 lands, and any other territory or possession of the

15 United States. Such term includes any political divi16 sion of any State.

17 ‘‘(22) TOBACCO.—The term ‘tobacco’ means to18 bacco in its unmanufactured form.

19 ‘‘(23) TOBACCO PRODUCT.—The term ‘tobacco

20 product’ means cigarettes, cigarillos, cigarette to21 bacco, little cigars, pipe tobacco, and smokeless to22 bacco, and roll-your-own tobacco.
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1 ‘‘Subtitle A—Public Health and

2 Education Programs

3 ‘‘SEC. 2811. PAYMENTS TO STATES.

4 ‘‘(a) FUNDS.—

5 ‘‘(1) IN GENERAL.—Subject to subsection (d),

6 there are hereby made available to carry out this

7 section for each fiscal year an amount equal to the

8 amount necessary to reimburse States as provided

9 for in subsection (b).

10 ‘‘(2) FISCAL YEAR LIMITATION.—Amounts

11 made available for a fiscal year under paragraph (1)

12 shall be equal to—

13 ‘‘(A) 43 percent of the net increase in rev14 enues received in the Treasury for such fiscal

15 year attributable to any amendments made to

16 chapter 52 of the Internal Revenue Code of

17 1986 in the fiscal year in which this title is en18 acted, as estimated by the Secretary; less

19 ‘‘(B) amounts made available for such fis20 cal year under sections 2812 and 2814.

21 ‘‘(b) REIMBURSEMENT.—

22 ‘‘(1) IN GENERAL.—The Secretary shall use

23 amounts made available under subsection (a) in each

24 fiscal year to provide funds to each State to reim25 burse such State for amounts expended by the State
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1 for the treatment of individuals with tobacco-related

2 illnesses or conditions, and to permit States to uti3 lize the Federal share of such expended amounts to

4 provide services for children.

5 ‘‘(2) AMOUNT.—The amount for which a State

6 is eligible for under paragraph (1) shall be based on

7 the ratio of the expenditures of the State under title

8 XIX of the Social Security Act (42 U.S.C. 1396 et

9 seq.) for fiscal year 1996 to the expenditures by all

10 States under such title for such fiscal year.

11 ‘‘(3) ADJUSTMENT.—With respect to a fiscal

12 year in which the amount determined under sub13 section (a)(1) exceeds the limitation under sub14 section (a)(2), the Secretary shall make pro rata re15 ductions in the amounts provided to States under

16 this subsection.

17 ‘‘(c) USE OF FUNDS.—

18 ‘‘(1) DETERMINATION.—With respect to each

19 State, the Secretary shall determine the proportion

20 of the reimbursement under subsection (b) for each

21 fiscal year that is equal to the amount that has been

22 paid to the State as the Federal medical assistance

23 percentage (as defined in section 1905(b)) of the So24 cial Security Act (42 U.S.C. 1396d(b)) expenditures

25 by the State for the preceding fiscal year.
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1 ‘‘(2) REQUIRED USE.—With respect to the

2 amount determined under paragraph (1) for a State

3 for a fiscal year, the Secretary shall not treat such

4 amount as an overpayment under any joint Federal5 State health program if the State certifies to the

6 Secretary that such amount will be used by the

7 State to serve the needs of children in the State

8 under 1 or more of the following programs:

9 ‘‘(A) An Even Start program under section

10 of the Head Start Act (42 U.S.C. 9801 et seq.).

11 ‘‘(B) The Head Start program under the

12 Head Start Act (42 U.S.C. 9801 et seq.).

13 ‘‘(C) A child care program under the Child

14 Care and Development Block Grant Act of

15 1990 (42 U.S.C. 658A et seq.).

16 ‘‘(D) The Individuals with Disabilities

17 Education Act.

18 ‘‘(E) The child care food program and

19 start-up and expansion funds for school break

20 programs and summer food programs under

21 section 17 of the National School Lunch Act

22 (42 U.S.C. 1766).

23 ‘‘(F) The special supplemental food pro24 gram under section 17 of the Child Nutrition

25 Act of 1966 (42 U.S.C. 1786).
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1 ‘‘(G) The Maternal and Child Health Serv2 ices Block Grant program under title V of the

3 Social Security Act (42 U.S.C. 701 et seq.).

4 ‘‘(H) The State Children’s Health Insur5 ance Program of the State under title XXI of

6 the Social Security Act (42 U.S.C. 1397aa et

7 seq.).

8 ‘‘(I) The family preservation and support

9 services program under section 430B of the So10 cial Security Act.

11 ‘‘(J) State initiated programs that are de12 signed to serve the health and developmental

13 needs of children and are approved by the Sec14 retary.

15 ‘‘(3) COORDINATION.—A State may use not to

16 exceed 20 percent of the amount determined under

17 paragraph (1) for the State for a fiscal year to—

18 ‘‘(A) improve linkages and coordination

19 among programs serving children and families,

20 including the provision of funds to outpost out21 reach workers into Federally funded early child22 hood programs to ensure effective enrollment in

23 child health initiatives referred to in paragraph

24 (2)(H);
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1 ‘‘(B) fund local collaboratives which shall

2 be required to use such funds on needs assess3 ments, planning, and investments to maximize

4 efforts to improve child development; and

5 ‘‘(C) fund innovative demonstrations that

6 address the outstanding needs of children and

7 families as assessed by State and local entities.

8 ‘‘(4) STATE PLAN.—To be eligible to receive

9 funds under this subsection a State shall prepare

10 and submit to the Secretary a State plan, at such

11 time, in such manner, and containing such informa12 tion as the Secretary may require, including a de13 scription of the manner in which the State will use

14 amounts provided under this subsection. Such plan

15 shall demonstrate, based on standards established by

16 the Secretary, that the State will comply with para17 graph (6).

18 ‘‘(5) APPLICATION OF REQUIREMENTS.—The

19 requirements of the respective provisions of law de20 scribed in paragraph (2) shall apply to any funds

21 made available under this subsection through State

22 programs under any such provision of law to the

23 same extent that such requirements would otherwise

24 apply to such programs under such provisions of

25 law.
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1 ‘‘(6) SUPPLEMENT NOT SUPPLANT.—Amounts

2 provided to a State under this subsection shall be

3 used to supplement and not supplant other Federal,

4 State and local funds provided for programs that

5 serve the health and developmental needs of chil6 dren. Amounts provided to the State under any of

7 the provisions of law referred to in paragraph (2)

8 shall not be reduced solely as a result of the avail9 ability of funds under this section.

10 ‘‘(7) OVERPAYMENTS.—Any amount of the re11 imbursement of a State under paragraph (1) to

12 which paragraph (2) applies that is not used in ac13 cordance with this subsection shall be treated by the

14 Secretary as an overpayment under section 1903 of

15 the Social Security Act (42 U.S.C. 1396b). Any such

16 overpayments may be allotted among other States

17 under this subsection in proportion to the amount

18 that the State originally received under this section.

19 ‘‘SEC. 2812. PUBLIC HEALTH PROGRAMS.

20 ‘‘(a) FUNDING.—There are hereby made available to

21 carry out this section—

22 ‘‘(1) for fiscal year 1998, $2,100,000,000;

23 ‘‘(2) for fiscal year 1999, $2,175,000,000 in24 creased by an amount equal to the increase in the

25 Consumer Price Index for the previous fiscal year
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1 for all urban consumers (all items; U.S. city aver2 age);

3 ‘‘(3) for fiscal year 2000, $2,200,000,000 in4 creased by an amount equal to the increase in the

5 Consumer Price Index for the 2 previous fiscal years

6 for all urban consumers (all items; U.S. city aver7 age);

8 ‘‘(4) for fiscal year 2001, $2,325,000,000 in9 creased by an amount equal to the increase in the

10 Consumer Price Index for the 3 previous fiscal years

11 for all urban consumers (all items; U.S. city aver12 age); and

13 ‘‘(5) for fiscal year 2002 and subsequent fiscal

14 years, the amount made available for fiscal year

15 2001 increased by an amount equal to the increase

16 in the Consumer Price Index for the period encom17 passing the fiscal years from 1998 to the fiscal year

18 prior to the fiscal year involved for all urban con19 sumers (all items; U.S. city average).

20 ‘‘(b) USE OF FUNDS.—Amounts made available for

21 a fiscal year under subsection (a) shall be distributed in

22 the following manner:

23 ‘‘(1) USE REDUCTION AND ADDICTION PREVEN24 TION RESEARCH.—
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1 ‘‘(A) IN GENERAL.—The amount described

2 in subparagraph (B) shall be used by Secretary

3 to carry out Federal tobacco use reduction and

4 addiction prevention research under section

5 2825(a).

6 ‘‘(B) AMOUNT.—The amount described in

7 this subparagraph is—

8 ‘‘(i) for fiscal year 1998,

9 $100,000,000; and

10 ‘‘(ii) for fiscal year 1999 and each

11 subsequent fiscal year, the amount de12 scribed in clause (i), increased for each

13 such fiscal year by an amount equal to the

14 increase in the Consumer Price Index for

15 the period encompassing the fiscal years

16 from 1998 to the fiscal year prior to the

17 fiscal year involved for all urban consumers

18 (all items; U.S. city average).

19 ‘‘(2) COUNTER-ADVERTISING.—

20 ‘‘(A) IN GENERAL.—The amount described

21 in subparagraph (B) shall be used by Secretary

22 to carry out the Federal tobacco product

23 counter-advertising campaign under section

24 2825(b).
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1 ‘‘(B) AMOUNT.—The amount described in

2 this subparagraph is—

3 ‘‘(i) for fiscal year 1998,

4 $500,000,000; and

5 ‘‘(ii) for fiscal year 1999 and each

6 subsequent fiscal year, the amount de7 scribed in clause (i), increased for each

8 such fiscal year by an amount equal to the

9 increase in the Consumer Price Index for

10 the period encompassing the fiscal years

11 from 1998 to the fiscal year prior to the

12 fiscal year involved for all urban consumers

13 (all items; U.S. city average).

14 ‘‘(3) CENTERS FOR DISEASE CONTROL AND

15 PREVENTION PROGRAMS.—

16 ‘‘(A) IN GENERAL.—The amount described

17 in subparagraph (B) shall be used by Secretary,

18 acting through the Centers for Disease Control

19 and Prevention, to carry programs to discour20 age the initiation of tobacco use, reduce the in21 cidence of tobacco use among current users,

22 and for other activities designed to reduce the

23 risk of dependence and injury from tobacco

24 products under section 2825(c).
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1 ‘‘(B) AMOUNT.—The amount described in

2 this subparagraph is—

3 ‘‘(i) for fiscal year 1998, $60,000,000;

4 ‘‘(ii) for each of the fiscal years 1998

5 and 2000, $60,000,000, increased for each

6 such fiscal year by an amount equal to the

7 increase in the Consumer Price Index for

8 the period encompassing the fiscal years

9 from 1998 to the fiscal year prior to the

10 fiscal year involved for all urban consumers

11 (all items; U.S. city average);

12 ‘‘(iii) for fiscal year 2001,

13 $100,000,000, increased for such fiscal

14 year by an amount equal to the increase in

15 the Consumer Price Index for fiscal years

16 1998 through 2000 for all urban consum17 ers (all items; U.S. city average); and

18 ‘‘(iv) for fiscal year 2002 and subse19 quent fiscal years, the amount described in

20 clause (iii), increased for each such fiscal

21 year by an amount equal to the increase in

22 the Consumer Price Index for the period

23 encompassing the fiscal years from 1998 to

24 the fiscal year prior to the fiscal year in-
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1 volved for all urban consumers (all items;

2 U.S. city average).

3 ‘‘(4) FOOD AND DRUG ADMINISTRATION.—

4 ‘‘(A) IN GENERAL.—The amount described

5 in subparagraph (B) shall be used by Secretary

6 to assist in defraying the costs associated with

7 the activities of the Food and Drug Administra8 tion relating to tobacco.

9 ‘‘(B) AMOUNT.—The amount described in

10 this subparagraph is—

11 ‘‘(i) for fiscal year 1998,

12 $300,000,000; and

13 ‘‘(ii) for fiscal year 1999 and each

14 subsequent fiscal year, the amount de15 scribed in clause (i), increased for each

16 such fiscal year by an amount equal to the

17 increase in the Consumer Price Index for

18 the period encompassing the fiscal years

19 from 1998 to the fiscal year prior to the

20 fiscal year involved for all urban consumers

21 (all items; U.S. city average).

22 ‘‘(5) STATE BLOCK GRANTS.—

23 ‘‘(A) IN GENERAL.—The amount described

24 in subparagraph (B) shall be used by Secretary

25 to make block grants to States under the Na-
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1 tional Tobacco Usage Reduction and Education

2 Block Grant Program under section 2826.

3 ‘‘(B) AMOUNT.—The amount described in

4 this subparagraph is—

5 ‘‘(i) for fiscal year 1998,

6 $1,144,000,000;

7 ‘‘(ii) for fiscal year 1999,

8 $1,215,000,000, increased for such fiscal

9 year by an amount equal to the increase in

10 the Consumer Price Index for the previous

11 fiscal year for all urban consumers (all

12 items; U.S. city average);

13 ‘‘(iii) for fiscal year 2000,

14 $1,240,000,000, increased for such fiscal

15 year by an amount equal to the increase in

16 the Consumer Price Index for fiscal years

17 1998 through 2000 for all urban consum18 ers (all items; U.S. city average);

19 ‘‘(iv) for fiscal year 2001,

20 $1,325,000,000, increased for such fiscal

21 year by an amount equal to the increase in

22 the Consumer Price Index for fiscal years

23 1998 through 2000 for all urban consum24 ers (all items; U.S. city average);
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1 ‘‘(v) for each of the fiscal years 2002

2 through 2008, $1,825,000,000, increased

3 for each such fiscal year by an amount

4 equal to the increase in the Consumer

5 Price Index for the period encompassing

6 the fiscal years from 1998 to the fiscal

7 year prior to the fiscal year involved for all

8 urban consumers (all items; U.S. city aver9 age); and

10 ‘‘(vi) for fiscal year 2009 and subse11 quent fiscal years, $1,750,000,000, in12 creased for each such fiscal year by an

13 amount equal to the increase in the

14 Consumer Price Index for fiscal years

15 1998 through the fiscal year previous to

16 the fiscal year for which the determination

17 is being made for all urban consumers (all

18 items; U.S. city average).

19 ‘‘SEC. 2813. BIOMEDICAL RESEARCH AND CHILD DEVELOP20 MENT INVESTMENTS.

21 ‘‘(a) FUNDING.—There are hereby made available to

22 carry out this section for each fiscal year an amount equal

23 to 57 percent of the net increase in revenues received in

24 the Treasury for such fiscal year attributable to any

25 amendments made to chapter 52 of the Internal Revenue
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1 Code of 1986 in the fiscal year in which this title is en2 acted, as estimated by the Secretary.

3 ‘‘(b) USE OF FUNDS.—Amounts made available for

4 a fiscal year under subsection (a) shall be used to carry

5 out national biomedical and basic scientific research activi6 ties and child development and research activities under

7 part 1 of subtitle C.

8 ‘‘SEC. 2814. TOBACCO VICTIMS COMPENSATION FUND.

9 ‘‘(a) FUNDING.—There are hereby made available to

10 carry out this section for each fiscal year an amount equal

11 to 14.2 percent of the net increase in revenues received

12 in the Treasury for such fiscal year attributable to any

13 amendments made to chapter 52 of the Internal Revenue

14 Code of 1986 in the fiscal year in which this title is en15 acted, as estimated by the Secretary.

16 ‘‘(b) USE OF FUNDS.—Amounts made available for

17 a fiscal year under subsection (a) shall be used to provide

18 assistance and compensation to individuals suffering from

19 tobacco-related illnesses and conditions, under a plan to

20 be developed by the Secretary, not later than 1 year after

21 the date of enactment of this Act, and submitted to Con22 gress for approval.
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1 ‘‘SEC. 2815. TOBACCO COMMUNITY TRANSITION ASSIST2 ANCE.

3 ‘‘(a) FUNDING.—There are hereby made available to

4 carry out this section—

5 ‘‘(1) for buyouts of quotas under section 411—

6 ‘‘(A) $3,100,000,000 for each of the fiscal

7 years 1998 and 1999; and

8 ‘‘(B) $3,000,000,000 for fiscal 2000; and

9 ‘‘(2) for block grants under section 431—

10 ‘‘(A) $500,000,000 for each of the fiscal

11 years 1998 and 1999;

12 ‘‘(B) $800,000,000 for each of the fiscal

13 years 2000 through 2002; and

14 ‘‘(C) $400,000,000 for fiscal year 2003.

15 ‘‘(b) USE OF FUNDS.—Amounts made available for

16 a fiscal year under subsection (a) shall remain available

17 until expended (except that with respect to amounts under

18 subsection (a)(1), such amounts shall only be available

19 until September 30, 2001) and shall be used to provide

20 tobacco transition assistance under title IV of the Healthy

21 and Smoke Free Children Act.
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1 ‘‘Subtitle B—National Health

2 Initiatives

3 ‘‘PART 1—NATIONAL BASIC AND CHILD

4 DEVELOPMENT RESEARCH

5 ‘‘SEC. 2821. NATIONAL BIOMEDICAL, BASIC AND CHILD DE6 VELOPMENT RESEARCH BOARD.

7 ‘‘(a) ESTABLISHMENT.—There is established a Fed8 eral board to be known as the ‘National Biomedical and

9 Basic Scientific Research Board’ (referred to in this sub10 part as the ‘Board’).

11 ‘‘(b) MEMBERSHIP.—

12 ‘‘(1) COMPOSITION.—The board shall be com13 posed of—

14 ‘‘(A) 9 voting members to be appointed by

15 the President from among individuals with ex16 pertise in biomedical research, basic research,

17 child development, and medicine; and

18 ‘‘(B) 3 ex officio (nonvoting) members of

19 which—

20 ‘‘(i) 1 shall be the Secretary;

21 ‘‘(ii) 1 shall be the Secretary of Edu22 cation; and

23 ‘‘(iii) 1 shall be the Assistant to the

24 President for Science and Technology.
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1 ‘‘(2) TERMS.—A member of the Board under

2 paragraph (1)(A) shall be appointed for a term of 6

3 years, except that of the members first appointed—

4 ‘‘(A) 3 members shall be appointed for

5 terms of 6 years;

6 ‘‘(B) 3 members shall be appointed for

7 terms of 4 years; and

8 ‘‘(C) 3 members shall be appointed for

9 terms of 2 years.

10 ‘‘(3) VACANCIES.—

11 ‘‘(A) IN GENERAL.—A vacancy on the

12 Board shall be filled in the same manner in

13 which the original appointment was made and

14 shall be subject to any conditions which applied

15 with respect to the original appointment.

16 ‘‘(B) FILLING UNEXPIRED TERM.—An in17 dividual appointed to fill a vacancy on the

18 Board shall be appointed for the unexpired

19 term of the member replaced.

20 ‘‘(C) EXPIRATION OF TERMS.—The term

21 of any member of the Board shall not expire be22 fore the date on which the member’s successor

23 takes office.
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1 ‘‘(c) CHAIRPERSON.—The President shall designate

2 a member of the Board appointed under subsection

3 (b)(1)(A) as the Chairperson of the Board.

4 ‘‘(d) MEETINGS AND QUORUM.—

5 ‘‘(1) IN GENERAL.—The Commission shall meet

6 at the call of the Chairperson.

7 ‘‘(2) INITIAL MEETING.—Not later than 30

8 days after the date on which all members of the

9 Board have been appointed, the Board shall hold its

10 first meeting.

11 ‘‘(3) QUORUM.—A majority of the members of

12 the Board appointed under subsection (b)(1)(A)

13 shall constitute a quorum, but a lesser number of

14 members may hold hearings.

15 ‘‘(e) PERSONNEL MATTERS.—

16 ‘‘(1) COMPENSATION.—Each member of the

17 Board who is not an officer or employee of the Fed18 eral Government shall be compensated at a rate

19 equal to the daily equivalent of the annual rate of

20 basic pay prescribed for level IV of the Executive

21 Schedule under section 5315 of title 5, United

22 States Code, for each day (including travel time)

23 during which such member is engaged in the per24 formance of the duties of the Board. All members of

25 the Board who are officers or employees of the Unit-
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•S 1492 IS

1 ed States shall serve without compensation in addi2 tion to that received for their services as officers or

3 employees of the United States.

4 ‘‘(2) TRAVEL EXPENSES.—The members of the

5 Board shall be allowed travel expenses, including per

6 diem in lieu of subsistence, at rates authorized for

7 employees of agencies under subchapter I of chapter

8 57 of title 5, United States Code, while away from

9 their homes or regular places of business in the per10 formance of services for the Board.

11 ‘‘(3) STAFF.—

12 ‘‘(A) IN GENERAL.—The Chairperson of

13 the Board may, without regard to the civil serv14 ice laws and regulations, appoint and terminate

15 an executive director and such other additional

16 personnel as may be necessary to enable the

17 Board to perform its duties. The employment of

18 an executive director shall be subject to con19 firmation by the Board.

20 ‘‘(B) COMPENSATION.—The Chairperson

21 of the Board may fix the compensation of the

22 executive director and other personnel without

23 regard to the provisions of chapter 51 and sub24 chapter III of chapter 53 of title 5, United

25 States Code, relating to classification of posi-
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•S 1492 IS

1 tions and General Schedule pay rates, except

2 that the rate of pay for the executive director

3 and other personnel may not exceed the rate

4 payable for level V of the Executive Schedule

5 under section 5316 of such title.

6 ‘‘(4) DETAIL OF GOVERNMENT EMPLOYEES.—

7 Any Federal Government employee may be detailed

8 to the Board without reimbursement, and such de9 tail shall be without interruption or loss of civil serv10 ice status or privilege.

11 ‘‘(5) PROCUREMENT OF TEMPORARY AND

12 INTERMITTENT SERVICES.—The Chairperson of the

13 Board may procure temporary and intermittent serv14 ices under section 3109(b) of title 5, United States

15 Code, at rates for individuals which do not exceed

16 the daily equivalent of the annual rate of basic pay

17 prescribed for level V of the Executive Schedule

18 under section 5316 of such title.

19 ‘‘(f) POWERS.—The Board shall award grants to, and

20 enter into contracts with eligible entities under section

21 2822 for the expansion of basic and biomedical research

22 and to provide graduate training with respect to such re23 search.

24 ‘‘(g) DELEGATION.—The Board may delegate all or

25 a portion of grant making authority under subsection (f)
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1 to the Secretary, the Secretary of Education, the Director

2 of the National Science Foundation, or the head of any

3 other Federal agency determined appropriate by the

4 Board.

5 ‘‘(h) AVAILABILITY OF FUNDS.—

6 ‘‘(1) IN GENERAL.—With respect to a fiscal

7 year, no funds shall be made available under this

8 part for such fiscal year until the Secretary certifies

9 that the amounts appropriated for each of the enti10 ties or activities described in subparagraphs (A) and

11 (B) of section 2822(a)(1) or subparagraphs (A), (B)

12 and (F) of section 2823(a)(1) for such fiscal year

13 has increased as compared to the amounts appro14 priated for the previous fiscal year—

15 ‘‘(A) by not less than the percentage in16 crease in the consumer price index, as deter17 mined by the Secretary of Labor; or

18 ‘‘(B) by an amount equal to the percentage

19 increase in the level of overall discretionary

20 spending for such fiscal year as compared to

21 the previous fiscal year;

22 whichever is greater.

23 ‘‘(2) APPLICATION TO CHILD DEVELOPMENT

24 ACTIVITIES.—With respect to a fiscal year, no funds

25 shall be made available under this part for such fis-
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•S 1492 IS

1 cal year until the Secretary certifies that the

2 amounts appropriated for each of the entities or ac3 tivities described in section 2823(a)(1)(F) for such

4 fiscal has increased as compared to the amounts ap5 propriated for the previous fiscal year—

6 ‘‘(A) by not less than the percentage in7 crease in the consumer price index, as deter8 mined by the Secretary of Labor; or

9 ‘‘(B) by an amount equal to the percentage

10 increase in the level of overall discretionary

11 spending for such fiscal year as compared to

12 the previous fiscal year;

13 whichever is less.

14 ‘‘(3) SUPPLEMENT NOT SUPPLANT.—Funds

15 made available for use under this part shall be used

16 to supplement and not supplant other funds appro17 priated to the entities described in section 2822(a)

18 and 2823(a). Amounts appropriated to such entities

19 under other provisions of law shall not be reduced

20 solely as a result of the availability of funds under

21 this section.
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1 ‘‘SEC. 2822. GRANTS FOR BIOMEDICAL AND BASIC RE2 SEARCH.

3 ‘‘(a) ELIGIBLE ENTITIES.—To be eligible to receive

4 a grant or contract under section 2821(f) an entity shall

5 be—

6 ‘‘(1) the National Institutes of Health (includ7 ing a subdivision or grantee of such Institutes);

8 ‘‘(2) the National Science Foundation (includ9 ing a subdivision or grantee of such Foundation);

10 ‘‘(3) nationally recognized research hospitals;

11 ‘‘(4) universities with recognized programs of

12 basic and biomedical research;

13 ‘‘(5) research institutes with expertise in the

14 conduct of basic or biomedical research;

15 ‘‘(6) cancer research centers that meet the

16 standards of section 414; and

17 ‘‘(7) entities conducting quality basic or bio18 medical research as determined by the Board.

19 ‘‘(b) GRADUATE TRAINING.—Support may be pro20 vided under section 2821(f) for graduate training, includ21 ing the following:

22 ‘‘(1) Grants for portable fellowships as defined

23 for purposes of the National Science Foundation Act

24 of 1950 (42 U.S.C. 1861 et seq.).

25 ‘‘(2) Grants to support an additional year of

26 portable fellowship training to enhance the teaching
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•S 1492 IS

1 capabilities of fellows seeking careers in academic

2 teaching settings.

3 ‘‘(3) Programs of student loan forgiveness for

4 students in the sciences and biomedical sciences who

5 pursue careers as teachers of science or biomedical

6 science or researchers in such fields in nonprofit in7 stitutions. Loans may be forgiven under this para8 graph at the rate of—

9 ‘‘(A) 15 percent per year for the first and

10 second fiscal years after the date of enactment

11 of this title;

12 ‘‘(B) 20 percent per year for the third and

13 fourth fiscal years after the date of enactment

14 of this title; and

15 ‘‘(C) 30 percent per year for the fifth fiscal

16 year after the date of enactment of this title.

17 ‘‘(4) Programs of postdoctoral fellowships for

18 individuals qualifying for such fellowships under the

19 authority of the National Science Foundation of Na20 tional Institutes of Health.

21 ‘‘(5) Programs of grants to universities and

22 other research facilities to assist in the equipping of

23 laboratories for new researchers of exceptional prom24 ise during the first 5 years of post-doctoral research.
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•S 1492 IS

1 ‘‘(6) Such other programs of grants and con2 tracts as the Board determines will contribute to in3 creasing the supply of high quality scientific and bio4 medical researchers.

5 ‘‘(c) FUNDING.—The Board shall use 50 percent of

6 the amount made available for a fiscal year under section

7 2813 to carry out this subpart in such fiscal year.

8 ‘‘SEC. 2823. INVESTMENTS IN HEALTHY CHILD DEVELOP9 MENT AND RESEARCH PROJECTS AND TRAIN10 ING.

11 ‘‘(a) CHILDREN’S RESEARCH, TRAINING AND DEM12 ONSTRATION PROJECTS.—

13 ‘‘(1) IN GENERAL.—The Secretary shall use not

14 to exceed 10 percent of the funds allocated for use

15 under this section to award grants of contracts for

16 the conduct and support of research, training and

17 demonstration projects relating to child health and

18 development.

19 ‘‘(2) ENTITIES ELIGIBLE FOR RESEARCH

20 PROJECTS.—To be eligible to receive a grant or con21 tract under paragraph (1) for the conduct or sup22 port of research an entity shall be—

23 ‘‘(A) the National Institutes of Health (in24 cluding a subdivision or grantee of such Insti25 tutes);
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•S 1492 IS

1 ‘‘(B) the National Science Foundation (in2 cluding a subdivision or grantee of the Founda3 tion);

4 ‘‘(C) a nationally recognized research hos5 pital;

6 ‘‘(D) a university with a recognized pro7 gram of research or training on children’s de8 velopment and health and childhood disabilities;

9 and

10 ‘‘(E) entities conducting child development

11 research and training; and

12 ‘‘(F) a public or private nonprofit organi13 zation, agency, or partnership with the capacity

14 to implement research findings on brain devel15 opment in the early years of life and for the

16 support of continual physical, intellectual, and

17 social development of young children, including

18 infants and toddlers with disabilities.

19 ‘‘(3) TRAINING PROJECTS.—Support may be

20 provided under subparagraphs (D), (E) and (F) of

21 paragraph (1) for training, including programs to

22 support undergraduate and graduate training pro23 grams to expand the early childhood development

24 workforce by recruiting; training students for ca25 reers in early childhood development and care, which
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1 may include grants to institutions, scholarships, and

2 programs of loan work forgiveness; and preservice

3 and inservice training programs to enhance the qual4 ity of the existing child care workforce.

5 ‘‘(4) DEMONSTRATION PROJECTS.—Support

6 may be provided under subparagraphs (D), (E) and

7 (F) of paragraph (1) for demonstration projects in8 cluding public-private partnerships for paid leave to

9 enable mothers with infants to choose to stay at

10 home.

11 ‘‘(5) EVALUATIONS.—Each project under this

12 subsection shall include an evaluation component to

13 assess the effectiveness of the project in achieving its

14 goals.

15 ‘‘(b) CHILD DEVELOPMENT PROJECTS.—

16 ‘‘(1) IN GENERAL.—The Secretary shall use not

17 less than 90 percent of the funds allocated for use

18 under this section as follows:

19 ‘‘(A) INVESTMENTS FOR EARLY CHILD20 HOOD DEVELOPMENT.—60 percent of such

21 funds will be used for investments in early

22 childhood development as follows:

23 ‘‘(i) 10 percent to expand the Early

24 Head Start program under section 645A of

25 the Head Start Act (42 U.S.C. 9841).
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1 ‘‘(ii) 20 percent to the Child Care and

2 Development Block Grant Act of 1990 (42

3 U.S.C. 658A et seq.) to provide certificates

4 and grants to increase the availability and

5 affordability of quality child care for chil6 dren of working families from birth

7 through school age, including children with

8 disabilities.

9 ‘‘(iii) 25 percent to expand the Head

10 Start program under the Head Start Act

11 (42 U.S.C. 9801) to increase enrollment

12 and responsiveness of such program.

13 ‘‘(iv) 5 percent to early childhood de14 velopment programs under part C and sec15 tion 619 of the Individuals with Disabil16 ities Education Act.

17 Not less than 30 percent of amounts made

18 available under clause (ii) shall be set-aside for

19 innovative programs for babies and toddlers, in20 cluding the development of family child care

21 networks, start-up for infant care programs, the

22 training of providers, or the provision of parent

23 education and support.

24 ‘‘(B) IMPROVEMENT OF THE QUALITY OF

25 CHILD CARE.—20 percent to establish a health
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•S 1492 IS

1 and safety fund through the Child Care and

2 Development Block Grant Act of 1990 (42

3 U.S.C. 658A et seq.), 50 percent of which shall

4 be used to provide incentives to reward States

5 that improve the quality of child care programs

6 in the State by adopting the essential compo7 nents of the child care program of the armed

8 services or the essential components of other

9 proven child care models. Such components in10 clude the provision of training linked to in11 creased wages, improved standards and enforce12 ment, lower child to staff ratios, higher rates

13 for accredited programs, and consumer edu14 cation including resources referral services.

15 ‘‘(C) PROGRAMS TO PROMOTE HEALTHY

16 BEHAVIOR.—20 percent to the Child Care and

17 Development Block Grant Act of 1990 (42

18 U.S.C. 658A et seq.) to expand the availability

19 and affordability of quality before- and after20 school care, and summer and weekend activities

21 for school age (through 15 years of age) chil22 dren, including children with disabilities, to pro23 mote good health and academic achievement

24 and to help in avoiding high risk behaviors. Eli25 gible entities for grants under this clause shall
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1 include elementary and secondary schools, com2 munity-based organizations, child care centers,

3 family child care homes, youth centers, or part4 nerships and should be targeted to communities

5 with high rates of poverty or at-risk children.

6 ‘‘(c) SUPPLEMENT NOT SUPPLANT.—Amounts pro7 vided to a State under this section shall be used to supple8 ment and not supplant other Federal, State and local

9 funds provided for programs that serve the health and de10 velopmental needs of children. Amounts provided to the

11 State under any of the provisions of law referred to in

12 this section shall not be reduced solely as a result of the

13 availability of funds under this section.

14 ‘‘(d) FUNDING.—The Board shall use 50 percent of

15 the amount made available for a fiscal year under section

16 2813 to carry out this subpart in such fiscal year.

17 ‘‘PART 2—PUBLIC HEALTH PROGRAMS

18 ‘‘SEC. 2825. RESEARCH, COUNTER-ADVERTISING, AND CDC

19 PROGRAMS.

20 ‘‘(a) REDUCTION AND ADDICTION PREVENTION RE21 SEARCH.—The Secretary shall provide for the conduct of

22 research concerning the development of methods, drugs,

23 and devices to discourage individuals from using tobacco

24 products and to assist individuals who use such products

25 in quitting such use.
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1 ‘‘(b) COUNTER-ADVERTISING.—The Secretary shall

2 carry out programs to reduce tobacco usage through

3 media-based (such as counter-advertising campaigns) and

4 nonmedia-based education, prevention and cessation cam5 paigns designed to discourage the use of tobacco products

6 by individuals and to encourage those who use such prod7 ucts to quit.

8 ‘‘(c) CENTERS FOR DISEASE CONTROL AND PREVEN9 TION PROGRAMS.—The Secretary, acting through the

10 Centers for Disease Control and Prevention, shall carry

11 programs to discourage the initiation of tobacco use, re12 duce the incidence of tobacco use among current users,

13 and for other activities designed to reduce the risk of de14 pendence and injury from tobacco products.

15 ‘‘(d) FUNDING.—

16 ‘‘(1) RESEARCH.—The Secretary shall use

17 amounts available under section 2812(b)(1) to carry

18 out subsection (a).

19 ‘‘(2) COUNTER-ADVERTISING.—The Secretary

20 shall use amounts available under section 2812(b)(2)

21 to carry out subsection (b).

22 ‘‘(3) CDC PROGRAMS.—The Secretary shall use

23 amounts available under section 2812(b)(3) to carry

24 out subsection (c).
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1 ‘‘SEC. 2826. NATIONAL TOBACCO USAGE REDUCTION AND

2 EDUCATION BLOCK GRANT PROGRAM.

3 ‘‘(a) BLOCK GRANTS.—The Secretary shall award

4 block grants to States to enable such States to carry out

5 activities for the purpose of planning, carrying out, and

6 evaluating tobacco use reduction and education activities

7 described in subsection (c).

8 ‘‘(b) APPLICATION.—

9 ‘‘(1) IN GENERAL.—A State that desires to re10 ceive a grant under subsection (a) shall prepare and

11 submit to the Secretary an application, at such time,

12 in such manner, and accompanied by such informa13 tion as the Secretary may require.

14 ‘‘(2) CONTENTS.—An application submitted

15 under paragraph (1) shall—

16 ‘‘(A) describe the activities that will be car17 ried out using assistance under this section; and

18 ‘‘(B) provide such assurances as the Sec19 retary determines to be necessary to carry out

20 this section.

21 ‘‘(c) USE OF FUNDS.—A State shall use amounts re22 ceived under this section to carry out the following activi23 ties:

24 ‘‘(1) TOBACCO USE CESSATION.—
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•S 1492 IS

1 ‘‘(A) IN GENERAL.—Activities to assist in2 dividuals in quitting the use of cigarettes or

3 other tobacco products.

4 ‘‘(B) MODEL STATE PROGRAM.—The Sec5 retary shall establish a model smoking cessation

6 program that may be used by States in the de7 sign of State-based smoking cessation pro8 grams. Such model program shall provide for

9 the provision of grants and other assistance by

10 such States to eligible entities and individuals

11 in the State for the establishment or adminis12 tration of tobacco product use cessation pro13 grams that are approved in accordance with

14 subparagraph (D).

15 ‘‘(C) USE OF ASSISTANCE.—Under a State

16 smoking cessation program under this para17 graph an entity that receives assistance shall

18 use such amounts to establish or administer to19 bacco product use cessation programs that are

20 approved in accordance with subparagraph (D).

21 ‘‘(D) APPROVAL OF CESSATION PROGRAM

22 OR DEVICES.—Using the best available sci23 entific information, the Secretary shall promul24 gate regulations to provide for the approval of

25 tobacco product use cessation programs and de-
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•S 1492 IS

1 vices. Such regulations shall be designed to en2 sure that tobacco product users, if requested,

3 are provided with reasonable access to safe and

4 effective cessation programs and devices. Such

5 regulations shall ensure that such individuals

6 have access to a broad range of cessation op7 tions that are tailored to the needs of the indi8 vidual tobacco user.

9 ‘‘(2) TOBACCO USAGE REDUCTION AND EDU10 CATION PROGRAM.—Activities—

11 ‘‘(A) to reduce tobacco usage through

12 media-based (such as counter-advertising cam13 paigns) and nonmedia-based education, preven14 tion and cessation campaigns designed to dis15 courage the use of tobacco products by individ16 uals who are under 18 years of age and to en17 courage those who use such products to quit;

18 ‘‘(B) to carry out informational campaigns

19 that are designed to discourage and de-glamor20 ize the use of tobacco products;

21 ‘‘(C) for tobacco use reduction in elemen22 tary and secondary schools; or

23 ‘‘(D) for community-based tobacco control

24 efforts that are designed to encourage commu-
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1 nity involvement in reducing tobacco product

2 use.

3 ‘‘(3) EVENT TRANSITIONAL SPONSORSHIP PRO4 GRAM.—

5 ‘‘(A) IN GENERAL.—Activities for the tran6 sitional sponsorship of certain activities, includ7 ing grants to—

8 ‘‘(i)(I) pay the costs associated with

9 the transitional sponsorship of an event or

10 activity;

11 ‘‘(II) provide for the transitional spon12 sorship of an individual or team;

13 ‘‘(III) pay the required entry fees as14 sociated with the participation of an indi15 vidual or team in an event or activity;

16 ‘‘(IV) provide financial or technical

17 support to an individual or team in connec18 tion with the participation of that individ19 ual or team in an activity described in sub20 paragraph (C)(iii); or

21 ‘‘(V) for any other purposes deter22 mined appropriate by the State; and

23 ‘‘(ii) promote images or activities to

24 discourage individuals from using tobacco
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1 products or encourage individuals who use

2 such products to quit.

3 ‘‘(B) ELIGIBILITY.—A State program

4 funded under this paragraph shall ensure that

5 to be eligible to receive assistance under this

6 paragraph an entity or individual shall prepare

7 and submit to the State an application at such

8 time, in such manner, and containing such in9 formation as the State may require, including—

10 ‘‘(i) a description of the event, activ11 ity, team, or entry for which the grant is

12 to be provided;

13 ‘‘(ii) documentation that the event,

14 activity, team, or entry involved was spon15 sored or otherwise funded by a tobacco

16 manufacturer or distributor prior to the

17 date of the application; and

18 ‘‘(iii) a certification that the applicant

19 is unable to secure funding for the event,

20 activity, team, or entry involved from

21 sources other than those described in

22 clause (ii).

23 ‘‘(C) PERMISSIBLE SPONSORSHIP ACTIVI24 TIES.—Events, activities, teams, or entries for
47

•S 1492 IS

1 which a grant may be provided under this para2 graph include—

3 ‘‘(i) an athletic, musical, artistic, or

4 other social or cultural event or activity

5 that was sponsored in whole or in part by

6 a tobacco manufacturer or distributor prior

7 to the date of enactment of this title;

8 ‘‘(ii) the participation of a team that

9 was sponsored in whole or in part by a to10 bacco manufacturer or distributor prior to

11 the date of enactment of this title, in an

12 athletic event or activity; and

13 ‘‘(iii) the payment of a portion or all

14 of the entry fees of, or other financial or

15 technical support provided to, an individual

16 or team by a tobacco manufacturer or dis17 tributor prior to the date of enactment of

18 this title, for participation of the individual

19 in an athletic, musical, artistic, or other

20 social or cultural event.

21 ‘‘(d) ALLOCATION OF FUNDS.—A State shall ensure

22 that amounts received under a block grant under sub23 section (a) are used to carry out each of the activities de24 scribed in subsection (c).
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1 ‘‘(e) FUNDING.—The Secretary shall use amounts

2 available under section 2812(b)(4) to carry out this sec3 tion.

4 ‘‘Subtitle C—Reduction in

5 Underage Tobacco Use

6 ‘‘SEC. 2831. PURPOSE.

7 ‘‘It is the purpose of this subtitle to encourage the

8 achievement of reductions in the number of underage con9 sumers of tobacco products through the imposition of ad10 ditional financial deterrents relating to tobacco products

11 if certain underage tobacco-use reduction targets are not

12 met.

13 ‘‘SEC. 2832. CHILD TOBACCO USE SURVEYS.

14 ‘‘(a) ANNUAL PERFORMANCE SURVEY.—Not later

15 than 1 year after the date of the enactment of this Act

16 and annually thereafter the Secretary shall conduct a sur17 vey to determine the number of children who used each

18 manufacturer’s tobacco products within the past 30 days.

19 ‘‘(b) EXCLUSION OF CERTAIN AGES.—The Secretary

20 may exclude from the survey conducted under subsection

21 (a), children under the age of 12 years (or such other less22 er age as the Secretary may establish) to strengthen the

23 validity of the survey.

24 ‘‘(c) BASELINE LEVEL.—The baseline level of the

25 child tobacco product use of a manufacturer (referred to
49

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1 in this subtitle as the ‘baseline level’) is the number of

2 children determined to have used the tobacco products of

3 such manufacturer in the first annual performance survey

4 for 1998.

5 ‘‘(d) ADDITIONAL MEASURES.—In order to increase

6 the understanding of youth tobacco product use, the Sec7 retary may, for informational purposes only, add addi8 tional measures to the survey under subsection (a), con9 duct periodic or occasional surveys at other times, and

10 conduct surveys of other populations such as young adults.

11 The results of such surveys shall be made available to

12 manufacturers and the public to assist in efforts to reduce

13 youth tobacco use.

14 ‘‘(e) DEFINITION.—As used in this subtitle, the term

15 ‘tobacco product’ means cigarettes, smokeless tobacco

16 products, and roll-your-own tobacco products.

17 ‘‘SEC. 2833. REDUCTION IN UNDERAGE TOBACCO PRODUCT

18 USAGE.

19 ‘‘(a) STANDARDS FOR EXISTING MANUFACTUR20 ERS.—Each manufacturer which manufactured a tobacco

21 product on or before the date of the enactment of this

22 title shall reduce the number of children who use its to23 bacco products so that the number of children determined

24 to have used its tobacco products on the basis of—
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1 ‘‘(1) the fourth annual performance survey is

2 equal to or less than—

3 ‘‘(A) 60 percent of the manufacturer’s

4 baseline level; or

5 ‘‘(B) the de minimis level;

6 whichever is greater;

7 ‘‘(2) the fifth annual performance survey is

8 equal to or less than—

9 ‘‘(A) 50 percent of the manufacturer’s

10 baseline level; or

11 ‘‘(B) the de minimis level;

12 whichever is greater;

13 ‘‘(3) the sixth annual performance survey is

14 equal to or less than—

15 ‘‘(A) 40 percent of the manufacturer’s

16 baseline level; or

17 ‘‘(B) the de minimis level;

18 whichever is greater;

19 ‘‘(4) the seventh annual performance survey is

20 equal to or less than—

21 ‘‘(A) 35 percent of the manufacturer’s

22 baseline level; or

23 ‘‘(B) the de minimis level;

24 whichever is greater;
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1 ‘‘(5) the eighth annual performance survey is

2 equal to or less than—

3 ‘‘(A) 30 percent of the manufacturer’s

4 baseline level; or

5 ‘‘(B) the de minimis level;

6 whichever is greater;

7 ‘‘(6) the ninth annual performance survey is

8 equal to or less than—

9 ‘‘(A) 25 percent of the manufacturer’s

10 baseline level; or

11 ‘‘(B) the de minimis level;

12 whichever is greater; and

13 ‘‘(7) the 10th annual performance survey and

14 each annual performance survey conducted there15 after is equal to or less than—

16 ‘‘(A) 20 percent of the manufacturer’s

17 baseline level; or

18 ‘‘(B) the de minimis level;

19 whichever is greater.

20 ‘‘(b) STANDARDS FOR NEW MANUFACTURERS.—Any

21 manufacturer of a tobacco product which begins to manu22 facture a tobacco product after the date of the enactment

23 of this title shall ensure that the number of children deter24 mined to have used the manufacturer’s tobacco products

25 in each annual performance survey conducted after the
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1 manufacturer begins to manufacture tobacco products is

2 equal to or less than the de minimis level.

3 ‘‘(c) DE MINIMIS LEVEL.—The de minimis level shall

4 be 0.5 percent of the total number of children determined

5 to have used tobacco products in the first annual perform6 ance survey.

7 ‘‘SEC. 2834. NONCOMPLIANCE.

8 ‘‘(a) VIOLATION OF STANDARD.—If, with respect to

9 a year, a manufacturer of a tobacco product fails to com10 ply with the required reduction under section 2833(a), the

11 manufacturer shall pay to the Secretary a noncompliance

12 fee for each unit of tobacco products manufactured by the

13 manufacturer which is distributed for consumer use in the

14 year following the year in which the noncompliance occurs,

15 in the amount specified in subsection (b).

16 ‘‘(b) NONCOMPLIANCE FEE PER UNIT.—

17 ‘‘(1) IN GENERAL.—With respect to a year, a

18 manufacturer of a tobacco product shall be required

19 to pay a noncompliance fee for each unit of tobacco

20 products manufactured by the manufacturer if the

21 noncompliance factor of the manufacturer (as deter22 mined under paragraph (3)) for the year is greater

23 than zero.

24 ‘‘(2) AMOUNT OF FEE.—The amount of the

25 noncompliance fee that is required to be paid by a
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1 manufacturer under this section for each unit of to2 bacco products manufactured by the manufacturer

3 for the year involved shall be equal to—

4 ‘‘(A) 2 cents multiplied by so much of the

5 noncompliance factor as does not exceed 5;

6 ‘‘(B) 3 cents multiplied by so much of the

7 noncompliance factor as exceeds 5 but does not

8 exceed 10;

9 ‘‘(C) 4 cents multiplied by so much of the

10 noncompliance factor as exceeds 10 but does

11 not exceed 15;

12 ‘‘(D) 5 cents multiplied by so much of the

13 noncompliance factor as exceeds 15 but does

14 not exceed 20; and

15 ‘‘(E) 6 cents multiplied by so much of the

16 noncompliance factor as exceeds 20 but does

17 not exceed 25.

18 ‘‘(3) NONCOMPLIANCE FACTOR.—The non19 compliance factor of a manufacturer shall be equal

20 to 100 multiplied by the noncompliance percentage

21 of the manufacturer (as determined under para22 graph (4)).

23 ‘‘(4) NONCOMPLIANCE PERCENTAGE.—The

24 noncompliance percentage (if any) of a manufacturer

25 shall be equal to 1 less the ratio of—
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1 ‘‘(A) the actual reduction that is achieved

2 by the manufacturer in the number of children

3 who use the manufacturer’s tobacco products in

4 the year involved; and

5 ‘‘(B) the reduction required under section

6 2833(a) in the number of children who use the

7 manufacturer’s tobacco products for the year.

8 ‘‘(c) NONCOMPLIANCE FEES FOR CONSECUTIVE VIO9 LATIONS.—If a manufacturer of a tobacco product fails

10 to comply with the required reduction under section

11 2833(a) in 2 or more consecutive years, the noncompliance

12 fee that is required to be paid by the manufacturer under

13 this section for each unit of tobacco products manufac14 tured by such manufacturer which is distributed for

15 consumer use in the year following the year in which the

16 noncompliance occurs, shall be the amount determined

17 under subsection (b) for the year multiplied by the number

18 of consecutive years in which the manufacturer has failed

19 to comply with such required reductions.

20 ‘‘(d) PROHIBITION ON SINGLE-PACK SALES IN

21 CASES OF REPEATED NONCOMPLIANCE.—Not later than

22 1 year after the date of enactment of this title, the Sec23 retary shall establish regulations to prohibit the sale of

24 single packs of a manufacturer’s tobacco products in cases

25 of repeated noncompliance with the reductions required
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1 under section 2833(a). Such regulations shall require that,

2 if a manufacturer fails to comply with such reductions in

3 3 or more consecutive years, the manufacturer’s tobacco

4 products may be sold in the following year only in pack5 ages containing not less than 10 units of the product per

6 package (200 cigarettes per package in the case of ciga7 rettes, and a corresponding package size for other tobacco

8 products).

9 ‘‘(e) REQUIRED GENERIC PACKAGING IN SEVERE

10 CASES OF REPEATED NONCOMPLIANCE.—Not later than

11 1 year after the date of enactment of this title, the Sec12 retary shall establish regulations to require units and

13 packages of a manufacturer’s tobacco products to have ge14 neric packaging in severe cases of repeated noncompliance

15 with the reductions required under section 2833(a). Such

16 regulations shall require that, if a manufacturer fails to

17 comply with such reductions in 4 or more consecutive

18 years, the manufacturer’s tobacco products may be sold

19 in the following year only in units and packages whose

20 packaging contains no external images, logos, or text

21 (other than any required labels), except that the brand

22 name and the identifier ‘tobacco’ may appear on the pack23 aging in block lettering in black type on a white back24 ground.
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1 ‘‘(f) PAYMENT.—The noncompliance fee to be paid

2 by a manufacturer under this section shall be paid on a

3 quarterly basis, with payments due not later than 30 days

4 after the end of each calendar quarter.

5 ‘‘SEC. 2835. USE OF AMOUNTS.

6 ‘‘Of the amounts received under section 2834—

7 ‘‘(1) 37.5 percent of such amounts shall be

8 made available to the National Biomedical and Basic

9 Scientific Research Board for research, training and

10 demonstration project grants under section 2822;

11 ‘‘(2) 37.5 percent of such amounts shall be

12 made available to the Secretary for healthy child de13 velopment grants under section 2823; and

14 ‘‘(3) 25 percent of such amounts shall be made

15 available to the Secretary for reduction and addic16 tion prevention research grants and for grants under

17 the national tobacco usage reduction and education

18 program under part 2 of subtitle C.

19 ‘‘SEC. 2836. MISCELLANEOUS PROVISIONS.

20 ‘‘(a) JUDICIAL REVIEW.—A manufacturer of tobacco

21 products may seek judicial review of any action under this

22 subtitle only after a noncompliance fee has been assessed

23 and paid by the manufacturer and only in the United

24 States District Court for the District of Columbia. In an
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1 action by a manufacturer seeking judicial review of an an2 nual performance survey, the manufacturer may prevail—

3 ‘‘(1) only if the manufacturer shows that the

4 results of the performance survey were arbitrary and

5 capricious; and

6 ‘‘(2) only to the extent that the manufacturer

7 shows that it would have been required to pay a less8 er noncompliance fee if the results of the perform9 ance survey were not arbitrary and capricious.

10 ‘‘(b) PASS-THROUGH.—Nothing in this subtitle shall

11 be construed as prohibiting a manufacturer from passing

12 the costs of the amount of any noncompliance fee assessed

13 under this subtitle on to consumers of tobacco products

14 as a further economic deterrent to the use of such prod15 ucts.

16 ‘‘(c) PROHIBITION.—No stay or other injunctive re17 lief may be granted by the Secretary or any court that

18 has the effect of enjoining the imposition and collection

19 of noncompliance fees to be applied under this section.

20 ‘‘(d) CHILD.—As used in this subtitle, the term

21 ‘child’ means, except as provided in section 2832(b), an

22 individual who is under the age of 18.
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1 ‘‘Subtitle D—Miscellaneous

2 Provisions

3 ‘‘SEC. 2841. WHISTLEBLOWER PROTECTIONS.

4 ‘‘(a) PROHIBITION OF REPRISALS.—An employee of

5 any manufacturer, distributor, or retailer of a tobacco

6 product may not be discharged, demoted, or otherwise dis7 criminated against (with respect to compensation, terms,

8 conditions, or privileges of employment) as a reprisal for

9 disclosing to an employee of the Food and Drug Adminis10 tration, the Department of Health and Human Services,

11 the Department of Justice, or any State or local regu12 latory or enforcement authority, information relating to a

13 substantial violation of law related to this title or a State

14 or local law enacted to further the purposes of this title.

15 ‘‘(b) ENFORCEMENT.—Any employee or former em16 ployee who believes that such employee has been dis17 charged, demoted, or otherwise discriminated against in

18 violation of subsection (a) may file a civil action in the

19 appropriate United States district court before the end of

20 the 2-year period beginning on the date of such discharge,

21 demotion, or discrimination.

22 ‘‘(c) REMEDIES.—If the district court determines

23 that a violation has occurred, the court may order the

24 manufacturer, distributor, or retailer involved to—
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1 ‘‘(1) reinstate the employee to the employee’s

2 former position;

3 ‘‘(2) pay compensatory damages; or

4 ‘‘(3) take other appropriate actions to remedy

5 any past discrimination.

6 ‘‘(d) LIMITATION.—The protections of this section

7 shall not apply to any employee who—

8 ‘‘(1) deliberately causes or participates in the

9 alleged violation of law or regulation; or

10 ‘‘(2) knowingly or recklessly provides substan11 tially false information to the Food and Drug Ad12 ministration, the Department of Health and Human

13 Services, the Department of Justice, or any State or

14 local regulatory or enforcement authority.

15 ‘‘SEC. 2842. NATIONAL TOBACCO DOCUMENT DEPOSITORY.

16 ‘‘(a) PURPOSE.—It is the purpose of this section to

17 provide for the disclosure of previously nonpublic or con18 fidential documents by manufacturers of tobacco products,

19 including the results of internal health research, and to

20 provide for a procedure to settle claims of attorney-client

21 privilege, work product, or trade secrets with respect to

22 such documents.

23 ‘‘(b) ESTABLISHMENT.—

24 ‘‘(1) IN GENERAL.—The Secretary shall provide

25 for the establishment, either within the Department
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1 of Health and Human Services or through a private

2 nonprofit entity, of a National Tobacco Document

3 Depository (in this section referred to as the ‘Depos4 itory’). Such Depository shall be located in the

5 Washington, D.C. area and be open to the public.

6 ‘‘(2) DOCUMENTS.—Manufacturers of tobacco

7 products, acting in conjunction with the Tobacco In8 stitute and the Council for Tobacco Research,

9 U.S.A., shall, not later than 30 days after the date

10 of enactment of this title, provide documents to the

11 Depository in accordance with this section.

12 ‘‘(3) FUNDING.—The entities described in para13 graph (2) shall bear the sole responsibility for fund14 ing the Depository.

15 ‘‘(c) USE OF DEPOSITORY.—The Depository shall be

16 maintained in a manner that permits the Depository to

17 be used as a resource for litigants, public health groups,

18 and any other individuals who have an interest in the cor19 porate records and research of the manufacturers concern20 ing smoking and health, addiction or nicotine dependency,

21 safer or less hazardous cigarettes, and underage tobacco

22 use and marketing.

23 ‘‘(d) CONTENTS.—The Depository shall include (and

24 manufacturers and the Tobacco Institute and the Council

25 for Tobacco Research, U.S.A. shall provide)—
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1 ‘‘(1) within 90 days of the date of the establish2 ment of the Depository, all documents provided by

3 such entities to plaintiffs in—

4 ‘‘(A) civil or criminal actions brought by

5 State attorneys general (including all docu6 ments selected by plaintiffs from the Guilford

7 Repository of the United Kingdom);

8 ‘‘(B) Philip Morris Companies Inc.’s defa9 mation action against Capital Cities/American

10 Broadcasting Company News;

11 ‘‘(C) the Federal Trade Commission’s in12 vestigation concerning Joe Camel and underage

13 marketing;

14 ‘‘(D) Haines v. Liggett Group, Inc. (814

15 F. Supp. 414 (D.N.J., Jan. 26, 1993)) and

16 Cippollone v. Liggett Group, Inc. (822 F. 2d

17 335, 56 USLW 2028, 7 Fed. R. Serv. 3d 1438

18 (3rd Cir. (N.J.), Jun. 8, 1987)); and

19 ‘‘(E) Estate of Burl Butler v. Philip Mor20 ris, Inc. (case No. 94–4–53);

21 ‘‘(2) within 90 days after the date of the estab22 lishment of the Depository, any existing documents

23 discussing or referring to health research, addiction

24 or dependency, safer or less hazardous cigarettes,

25 studies of the smoking habits of minors, and the re-
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1 lationship between advertising or promotion and

2 youth smoking, that the entities described in sub3 section (b) have not completed producing as required

4 in the actions described in paragraph (1);

5 ‘‘(3) within 30 days of the date of the establish6 ment of the Depository, all documents relating to in7 dices (as defined by the court in State of Minnesota

8 and Blue Cross and Blue Shield of Minnesota v.

9 Philip Morris, Inc., et al.) of documents relating to

10 smoking and health, including all indices identified

11 by the manufacturers in the State of Texas v. Amer12 ican Tobacco Company, et al.;

13 ‘‘(4) upon the settlement of any action referred

14 to in this subsection, and after a good-faith, de novo,

15 document-by-document review of all documents pre16 viously withheld from production in any actions on

17 the grounds of attorney-client privilege, all docu18 ments determined to be outside of the scope of the

19 privilege;

20 ‘‘(5) all existing or future documents relating to

21 original laboratory research concerning the health or

22 safety of tobacco products, including all laboratory

23 research results relating to methods used to make

24 tobacco products less hazardous to consumers;
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1 ‘‘(6) a comprehensive new attorney-client privi2 lege log of all documents, itemized in sufficient de3 tail so as to enable any interested individual to de4 termine whether the individual will challenge the

5 claim of privilege, that the entities described in sub6 section (b) (based on the de novo review of such doc7 uments by such entities) claim are protected from

8 disclosure under the attorney-client privilege;

9 ‘‘(7) all existing or future documents relating to

10 studies of the smoking habits of minors or docu11 ments referring to any relationship between advertis12 ing and promotion and underage smoking; and

13 ‘‘(8) all other documents determined appro14 priate under regulations promulgated by the Sec15 retary.

16 ‘‘(e) DISPUTE RESOLUTION PANEL.—

17 ‘‘(1) ESTABLISHMENT.—The Judicial Con18 ference of the United States shall establish a To19 bacco Documents Dispute Resolution Panel, to be

20 composed of 3 Federal judges to be appointed by the

21 Conference, to resolve all disputes involving claims

22 of attorney-client, work product, or trade secrets

23 privilege with respect to documents required to be

24 deposited into the Depository under subsection (d)

25 that may be brought by Federal, State, or local gov-
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1 ernmental officials or the public or asserted in any

2 action by a manufacturer.

3 ‘‘(2) BASIS FOR DETERMINATIONS.—The deter4 minations of the Panel established under paragraph

5 (1) shall be based on—

6 ‘‘(A) the American Bar Association/Amer7 ican Law Institute Model Rules or the prin8 cipals of Federal law with respect to attorney9 client or work product privilege; and

10 ‘‘(B) the Uniform Trade Secrets Act with

11 respect to trade secrecy.

12 ‘‘(3) DECISION.—Any decision of the Panel es13 tablished under paragraph (1) shall be final and

14 binding upon all Federal and State courts.

15 ‘‘(4) ASSESSING OF FEES.—As part of a deter16 mination under this subsection, the Panel estab17 lished under paragraph (1) shall determine whether

18 a claimant of the privilege acted in good faith and

19 had a factual and legal basis for asserting the claim.

20 If the Panel determines that the claimant did not

21 act in good faith, the Panel may assess costs against

22 the claimant, including a reasonable attorneys’ fee,

23 and may apply such other sanctions as the Panel de24 termines appropriate.
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1 ‘‘(5) ACCELERATED REVIEW.—The Panel estab2 lished under paragraph (1) shall establish proce3 dures for the accelerated review of challenges to a

4 claim of privilege. Such procedures shall include as5 surances that an individual filing a challenge to such

6 a claim need not make a prima facie showing of any

7 kind as a prerequisite to an in-camera review of the

8 documents at issue.

9 ‘‘(6) SPECIAL MASTERS.—The Panel estab10 lished under paragraph (1) may appoint Special

11 Masters in accordance with Rule 53 of the Federal

12 Rules of Civil Procedure. The cost relating to any

13 Special Master shall be assessed to the manufactur14 ers as part of a fee process to be established under

15 regulations promulgated by the Secretary.

16 ‘‘(f) OTHER PROVISIONS.—

17 ‘‘(1) NO WAIVER OF PRIVILEGE.—Compliance

18 with this section by the entities described in sub19 section (b) shall not be deemed to be a waiver on be20 half of such entities of any applicable privilege or

21 protection.

22 ‘‘(2) AVOIDANCE OF DESTRUCTION.—In estab23 lishing the Depository, procedures shall be imple24 mented to protect against the destruction of docu25 ments.
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1 ‘‘(3) DEEMED PRODUCED.—Any documents

2 contained in the Depository shall be deemed to have

3 been produced for purposes of any tobacco-related

4 litigation in the United States.

5 ‘‘(g) DOCUMENTS.—For purposes of this section, the

6 term ‘documents’ shall include any paper documents that

7 may be printed using data that is contained in computer

8 files.

9 ‘‘(h) RULE OF CONSTRUCTION.—Nothing in this sec10 tion shall be construed to interfere in any way with the

11 discovery rights of courts or parties in civil or criminal

12 actions involving tobacco products, or the right of access

13 to such documents under any other provision of law.

14 ‘‘SEC. 2843. TOBACCO OVERSIGHT AND COMPLIANCE

15 BOARD.

16 ‘‘(a) ESTABLISHMENT.—

17 ‘‘(1) IN GENERAL.—There is established an

18 independent board to be known as the Tobacco

19 Oversight and Compliance Board (referred to in this

20 section as the ‘Board’).

21 ‘‘(2) MEMBERSHIP.—The Board shall consist of

22 5 members with expertise relating to tobacco and

23 public health. The members, including the chair24 person, shall be appointed by the Secretary. The ini25 tial members of the Board shall be appointed by the
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1 Secretary within 30 days of the date of the enact2 ment of this title. A member of the Board may be

3 removed by the Secretary only for neglect of duty or

4 malfeasance in office.

5 ‘‘(3) TERMS.—The term of office of a member

6 of the Board shall be 6 years, except that the mem7 bers first appointed shall have terms of 2, 3, 4, and

8 5 years, respectively, as determined by the Sec9 retary.

10 ‘‘(b) GENERAL DUTY.—The Board shall oversee and

11 monitor the operations of the tobacco industry to deter12 mine whether tobacco product manufacturers are in com13 pliance with this Act.

14 ‘‘(c) DISCLOSURE OF TOBACCO INDUSTRY DOCU15 MENTS.—

16 ‘‘(1) SUBMISSION BY MANUFACTURERS.—Not

17 later than 3 months after the date of the enactment

18 of this title, and as otherwise required by the Board,

19 each tobacco manufacturer shall submit to the

20 Board a copy of all documents in the manufacturer’s

21 possession—

22 ‘‘(A) relating to—

23 ‘‘(i) any health effects, including ad24 diction, caused by the use of tobacco prod25 ucts;
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1 ‘‘(ii) the manipulation or control of

2 nicotine in tobacco products; or

3 ‘‘(iii) the sale or marketing of tobacco

4 products to children; or

5 ‘‘(B) produced, or ordered to be produced,

6 by the tobacco manufacturer in the case enti7 tled State of Minnesota v. Philip Morris, Inc.,

8 Civ. Action No. C1–94–8565 (Ramsey County,

9 Minn.) including attorney-client and other docu10 ments produced or ordered to be produced for

11 in camera inspection.

12 ‘‘(2) DISCLOSURE BY THE BOARD.—Not later

13 than 6 months after the date of the enactment of

14 this title, and otherwise as required by the Board,

15 the Board shall, subject to paragraph (3), make

16 available to the public the documents submitted

17 under paragraph (1).

18 ‘‘(3) PROTECTION OF TRADE SECRETS.—The

19 Board, members of the Board, and staff of the

20 Board shall not disclose information that is entitled

21 to protection as a trade secret unless the Board de22 termines that disclosure of such information is nec23 essary to protect the public health. This paragraph

24 shall not be construed to prevent the disclosure of
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1 relevant information to other Federal agencies or to

2 committees of the Congress.

3 ‘‘(d) INVESTIGATION AND ANNUAL REPORTS.—The

4 Board shall investigate all matters relating to the tobacco

5 industry and public health and report annually on the re6 sults of the investigation to Congress. Each annual report

7 to Congress shall, at a minimum, disclose—

8 ‘‘(1) whether tobacco manufacturers are in

9 compliance with the provisions of this Act;

10 ‘‘(2) any efforts by tobacco manufacturers to

11 conceal research relating to the adverse health ef12 fects or addiction caused by the use of tobacco prod13 ucts;

14 ‘‘(3) any efforts by tobacco manufacturers to

15 mislead the public or any Federal, State, or local

16 elected body, agency, or court about the adverse

17 health effects or addiction caused by the use of to18 bacco products;

19 ‘‘(4) any efforts by tobacco manufacturers to

20 sell or market tobacco products to children; and

21 ‘‘(5) any efforts by tobacco manufacturers to

22 circumvent, repeal, modify, impede the implementa23 tion of, or prevent the adoption of any Federal,

24 State, or local law or regulation intended to reduce
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1 the adverse health effects or addiction caused by the

2 use of tobacco products.

3 ‘‘(e) AUTHORITY.—The Board, any member of the

4 Board, or staff designated by the Board may hold hear5 ings, administer oaths, issue subpoena, require the testi6 mony or deposition of witnesses, the production of docu7 ments, or the answering of interrogatories, or, upon pres8 entation of the proper credentials, enter and inspect facili9 ties.

10 ‘‘(f) ENFORCEMENT.—Notwithstanding any other

11 provision of law, tobacco manufacturers shall provide any

12 testimony, deposition, documents, or other information,

13 answer any interrogatories, and allow any entry or inspec14 tion required pursuant to this section, except to the extent

15 that a constitutional privilege protects the tobacco manu16 facturer from complying with such requirement.

17 ‘‘(g) ADMINISTRATION.—

18 ‘‘(1) STAFF.—The Chairperson of the Board

19 shall exercise the executive and administrative func20 tions of the Board and shall have the authority to

21 hire such staff as may be necessary for the operation

22 of the Board.

23 ‘‘(2) SALARIES.—The members of the Board

24 shall receive such salary and benefits as the Sec25 retary deems necessary, except that the salary of the
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1 Chairperson shall not be less than that provided for

2 under level III of the Executive Schedule in section

3 5314 of title 5, United States Code.

4 ‘‘SEC. 2844. PRESERVATION OF STATE AND LOCAL AUTHOR5 ITY.

6 ‘‘Except as otherwise provided for in this title or the

7 Healthy and Smoke Free Children Act (or an amendment

8 made by such Act), nothing in this title or such Act shall

9 be construed as prohibiting a State from imposing require10 ments, prohibitions, penalties or other measures to further

11 the purposes of this title or Act that are in addition to

12 the requirements, prohibitions, or penalties required under

13 this title or Act. To the extent not inconsistent with the

14 purposes of this title or Act, State and local governments

15 may impose additional tobacco product control measures

16 to further restrict or limit the use of such products by

17 minors.

18 ‘‘SEC. 2845. REGULATIONS.

19 ‘‘The Secretary may promulgate regulations to en20 force the provisions of this title, or to modify, alter, or

21 expand the requirements and protections provided for in

22 this title if the Secretary determines that such modifica23 tions, alternations, or expansion is necessary.’’.
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1 TITLE II—FDA JURISDICTION

2 OVER TOBACCO PRODUCTS

3 Subtitle A—Amendments to the

4 Federal Food, Drug and Cos5 metic Act

6 SEC. 201. REFERENCE.

7 Whenever in this subtitle an amendment or repeal is

8 expressed in terms of an amendment to, or repeal of, a

9 section or other provision, the reference shall be consid10 ered to be made to a section or other provision of the Fed11 eral Food, Drug, and Cosmetic Act (21 U.S.C. 301 et

12 seq.).

13 SEC. 202. STATEMENT OF GENERAL AUTHORITY.

14 The Secretary of Health and Human Services, acting

15 through the Food and Drug Administration, shall have the

16 authority under the Federal Food, Drug, and Cosmetic

17 Act (21 U.S.C. 321 et seq.) (above and beyond the existing

18 authority of the Secretary to regulate tobacco products as

19 of the date of enactment of this Act) to regulate the manu20 facture, labeling, sale, distribution, and advertising of to21 bacco products.

22 SEC. 203. TREATMENT OF TOBACCO PRODUCTS AS DRUGS

23 AND DEVICES.

24 (a) DEFINITIONS.—
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1 (1) DRUG.—Section 201(g)(1) (21 U.S.C.

2 321(g)(1)) is amended by striking ‘‘; and (D)’’ and

3 inserting ‘‘(including nicotine in tobacco products);

4 and (D)’’.

5 (2) DEVICES.—Section 201(h) (21 U.S.C.

6 321(h)) is amended—

7 (A) in paragraph (3), by inserting before

8 the comma the following: ‘‘(including tobacco

9 products containing nicotine); and

10 (B) by adding at the end the following:

11 ‘‘For purposes of this Act a tobacco product

12 shall be classified as a class II device.’’.

13 (3) OTHER DEFINITIONS.—Section 201 (21

14 U.S.C. 321) is amended by adding at the end there15 of the following new paragraphs:

16 ‘‘(ii)(1) The term ‘tobacco product’ means cigarettes,

17 cigarillos, cigarette tobacco, little cigars, pipe tobacco, and

18 smokeless tobacco, and roll-your-own tobacco.

19 ‘‘(2) The term ‘cigarette’ means any product which

20 contains nicotine, is intended to be burned under ordinary

21 conditions of use, and consists of—

22 ‘‘(A) any roll of tobacco wrapped in paper or in

23 any substance not containing tobacco; and

24 ‘‘(B) any roll of tobacco wrapped in any sub25 stance containing tobacco which, because of its ap-
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1 pearance, the type of tobacco used in the filler, or

2 its packaging and labeling, is likely to be offered to,

3 or purchased by, consumers as a cigarette described

4 in subparagraph (A).

5 ‘‘(3) The term ‘cigarette tobacco’ means any product

6 that consists of loose tobacco that contains or delivers nic7 otine and is intended for use by persons in a cigarette.

8 Unless otherwise stated, the requirements of this title per9 taining to cigarettes shall also apply to cigarette tobacco.

10 ‘‘(4) The term ‘smokeless tobacco’ means any product

11 that consists of cut, ground, powdered, or leaf tobacco that

12 contains nicotine and that is intended to be placed in the

13 oral or nasal cavity.

14 ‘‘(5) The term ‘roll-your-own tobacco’ has the mean15 ing given such term by section 5702(p) of the Internal

16 Revenue Code of 1986.

17 ‘‘(6) The term ‘little cigars’ means any roll of tobacco

18 wrapped in leaf tobacco or any substance containing to19 bacco (other than any roll of tobacco which is a cigarette

20 within the meaning of this Act) and as to which 1,000

21 units weigh not more than 3 pounds.

22 ‘‘(7) The term ‘cigar’ means any roll of tobacco

23 wrapped in leaf tobacco or in any substance containing

24 tobacco (other than any roll of tobacco which is a cigarette

25 or cigarillo within the meaning of paragraph (3) or (4)).
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1 ‘‘(8) The term ‘cigarillos’ means any roll of tobacco

2 wrapped in leaf tobacco or any substance containing to3 bacco (other than any roll of tobacco which is a cigarette

4 within the meaning of paragraph (3)) and as to which

5 1,000 units weigh not more than 3 pounds.

6 ‘‘(9) The term ‘pipe tobacco’ means any loose tobacco

7 that, because of its appearance, type, packaging, or label8 ing, is likely to be offered to, or purchased by, consumers

9 as a tobacco product to be smoked in a pipe.

10 ‘‘(10) The term ‘nicotine’ means the chemical sub11 stance named 3-(1-Methyl-2-pyrrolidinyl)pyridine or

12 C10H14N2, including any salt or complex of nicotine.’’.

13 ‘‘(11) The term ‘tobacco additive’ means any sub14 stance the intended use of which results or may reasonably

15 be expected to result, directly or indirectly, in the sub16 stance becoming a component of, or otherwise affecting

17 the characteristics of, any tobacco product, including any

18 substance that may have been removed from the tobacco

19 product and then readded in the substance’s original or

20 modified form.

21 ‘‘(12) The term ‘tar’ means mainstream total articu22 late matter minus nicotine and water.’’.

23 (b) MISBRANDING.—Section 502(q) (21 U.S.C.

24 352(q)) is amended—
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1 (1) by striking ‘‘or (2)’’ and inserting ‘‘(2)’’;

2 and

3 (2) by inserting before the period the following:

4 ‘‘or (3) in the case of a tobacco product, it is sold,

5 distributed, advertised, labeled, or used in violation

6 of this Act or the regulations prescribed under this

7 Act.’’.

8 (c) REGULATORY AUTHORITY.—Section 503(g)(1)

9 (21 U.S.C. 353(g)(1)) is amended by inserting ‘‘(including

10 any tobacco product)’’ after ‘‘products’’ the first place

11 such term appears.

12 (d) CLASS II DEVICES.—Section 513(a)(1)(B) (21

13 U.S.C. 360c(a)(1)(B)) is amended—

14 (1) by striking ‘‘A device’’ and inserting ‘‘(i) A

15 device’’; and

16 (2) by adding at the end the following: ‘‘To17 bacco products shall be categorized as Class II de18 vices.

19 ‘‘(ii) The sale of tobacco products to adults

20 that comply with Performance Standards estab21 lished for these products pursuant to section

22 514, title XXVIII of the Public Health Service

23 Act, and this Act, and any regulations pre24 scribed under this Act, shall not be prohibited
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1 by the Secretary, notwithstanding sections

2 502(j), 516, and 518.’’.

3 (e) PERFORMANCE STANDARDS.—Section 514(a) (21

4 U.S.C. 360d(a)) is amended—

5 (1) in paragraph (2), by striking ‘‘device—’’

6 and inserting ‘‘non-tobacco product device—’’;

7 (2) by redesignating paragraphs (3) and (4) as

8 paragraphs (4) and (5), respectively; and

9 (3) by adding at the end the following:

10 ‘‘(3)(A) A performance standard established under

11 this section for a tobacco product device—

12 ‘‘(i) shall include provisions to reduce the over13 all health risks to the public, including the reduction

14 in risk to consumers thereof and the reduction in

15 harm which will result from those who continue to

16 use the product, but less often and from those who

17 stop or do not start using the product, taking into

18 account all factors that the Secretary determines to

19 be relevant;

20 ‘‘(ii) shall, where necessary to provide a reduc21 tion in the overall health risks to the public, in22 clude—

23 ‘‘(I) provisions regarding the construction,

24 components, constituents, ingredients, and

25 properties of the tobacco product device, includ-
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1 ing the reduction or elimination of nicotine and

2 the other components, ingredients, and con3 stituents of the tobacco product and its compo4 nents, based upon the best available technology;

5 ‘‘(II) provisions for the testing of the to6 bacco product device (on a sample basis or, if

7 necessary, on an individual basis) or, if it deter8 mined that no other more practicable means are

9 available to the Secretary to assure the con10 formity of the tobacco product device to the

11 standard, provision for the testing (on a sample

12 basis or, if necessary, on an individual basis) by

13 the Secretary or by another person at the direc14 tion of the Secretary;

15 ‘‘(III) provisions for the measurement of

16 the performance characteristics of the tobacco

17 product device;

18 ‘‘(IV) provisions requiring that the results

19 of each or of certain of the tests of the tobacco

20 product device required to be made under sub21 clause (II) show that the tobacco product device

22 is in conformity with the portions of the stand23 ard for which the test or tests were required;

24 and
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1 ‘‘(V) a provision that the sale, advertising,

2 and distribution of the tobacco product device

3 be restricted but only to the extent the sale, ad4 vertising, and distribution of a tobacco product

5 device may be restricted under this Act or title

6 XXVIII of the Public Health Service Act; and

7 ‘‘(iii) shall, where appropriate, require the use

8 and prescribe the form and content of labeling for

9 use of the tobacco product device.

10 ‘‘(B) The Secretary shall provide for the periodic

11 evaluation of a performance standard established under

12 this paragraph to determine if such standards should be

13 changed to reflect new medical, scientific, or other techno14 logical data.

15 ‘‘(C) In carrying out this paragraph, the Secretary

16 shall, to the maximum extent practicable—

17 ‘‘(i) use personnel, facilities, and other technical

18 support available in other Federal agencies;

19 ‘‘(ii) consult with the Scientific Advisory Com20 mittee established under section 905 and other Fed21 eral agencies concerned with standard-setting and

22 other nationally or internationally recognized stand23 ard-setting entities; and

24 ‘‘(iii) invite appropriate participation, through

25 joint or other conferences, workshops, or other
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1 means, by informed persons representative of sci2 entific, professional, industry, or consumer organiza3 tions who in the judgment of the Secretary can

4 make a significant contribution.’’.

5 (f) RESTRICTED DEVICES.—Section 520(e) (21

6 U.S.C. 360j(e)) is amended by adding at the end the fol7 lowing:

8 ‘‘(3) A tobacco product is a restricted device.’’.

9 (g) REGULATIONS.—Section 701(a) (21 U.S.C.

10 371(a)) is amended by inserting before the period the fol11 lowing: ‘‘, including the authority to regulate the manufac12 ture, sale, distribution, advertising and marketing of to13 bacco products’’.

14 SEC. 204. GENERAL HEALTH AND SAFETY REGULATION OF

15 TOBACCO PRODUCTS.

16 The Act (21 U.S.C. 301 et seq.) is amended—

17 (1) by redesignating chapter IX as chapter X;

18 (2) by redesignating sections 901, 902, 903,

19 904, and 905 as sections 1001, 1002, 1003, 1004,

20 and 1005, respectively; and

21 (3) by adding after chapter VIII the following

22 new chapter:
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1 ‘‘CHAPTER IX—TOBACCO PRODUCTS

2 ‘‘SEC. 901. DEFINITIONS.

3 ‘‘For purposes of this chapter and in addition to the

4 definitions contained in section 201, the definitions under

5 section 2801 of the Public Health Service Act shall apply.

6 ‘‘SEC. 902. PURPOSE.

7 ‘‘It is the purpose of this chapter to impose a regu8 latory scheme applicable to the development and manufac9 turing of tobacco products. Such scheme shall include—

10 ‘‘(1) with respect to ingredients contained in

11 such products—

12 ‘‘(A) the immediate and annual reporting,

13 in accordance with section 909(a), of all ingre14 dients contained in such products;

15 ‘‘(B) the performance, in accordance with

16 section 909(b), of safety assessments with re17 spect to ingredients contained in such products;

18 and

19 ‘‘(C) the approval, in accordance with sec20 tion 909(b), of ingredients contained in such

21 products; and

22 ‘‘(2) the imposition of standards to reduce the

23 level of certain constituents contained in such prod24 ucts, including nicotine.
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1 ‘‘SEC. 903. PROMULGATION OF REGULATIONS.

2 ‘‘The Commissioner shall promulgate regulations gov3 erning the misbranding, adulteration, and dispensing of

4 tobacco products that are consistent with this chapter and

5 with the manner in which other products that are ingested

6 into the body are regulated under this Act. Such regula7 tions shall be promulgated not later than 12 months after

8 the date of enactment of this chapter.

9 ‘‘SEC. 904. MINIMUM REQUIREMENTS.

10 ‘‘(a) MISBRANDING.—The regulations promulgated

11 under section 903 shall at a minimum require that a to12 bacco product be deemed to be misbranded if the labeling

13 of the package of such product is not in compliance with

14 the provisions of this chapter, of other applicable provi15 sions of this Act, or of section 910 (as applicable to the

16 type of product involved) of the Public Health Service Act.

17 ‘‘(b) ADULTERATION.—The regulations promulgated

18 under section 903 shall at a minimum require that a to19 bacco product be deemed to be adulterated if the Commis20 sioner determines that any tobacco additive in such prod21 uct, regardless of the amount of such tobacco additive, ei22 ther by itself or in conjunction with any other tobacco ad23 ditive or ingredient is harmful under the intended condi24 tions of use when used in a specified amount.
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1 ‘‘SEC. 905. SCIENTIFIC ADVISORY COMMITTEE.

2 ‘‘(a) ESTABLISHMENT.—Not later than 1 year after

3 the date of enactment of this chapter, the Secretary shall

4 establish an advisory committee, to be known as the ‘Sci5 entific Advisory Committee’, to assist the Secretary in es6 tablishing, amending, or revoking a performance standard

7 under section 512(a)(3).

8 ‘‘(b) MEMBERSHIP.—The Secretary shall appoint as

9 members of the Scientific Advisory Committee any individ10 uals with expertise in the medical, scientific, or other tech11 nological data involving the manufacture and use of to12 bacco products, and of appropriately diversified profes13 sional backgrounds. The Secretary may not appoint to the

14 Committee any individual who is in the regular full-time

15 employ of the Federal Government. The Secretary shall

16 designate 1 of the members of each advisory committee

17 to serve as chairperson of the Committee.

18 ‘‘(c) COMPENSATION AND EXPENSES.—

19 ‘‘(1) COMPENSATION.—Members of the Sci20 entific Advisory Committee who are not officers or

21 employees of the United States, while attending con22 ferences or meetings of the Committee or otherwise

23 serving at the request of the Secretary, shall be enti24 tled to receive compensation at rates to be fixed by

25 the Secretary, which rates may not exceed the daily

26 equivalent of the rate of pay for level 4 of the Senior
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1 Executive Schedule under section 5382 of title 5,

2 United States Code, for each day (including travel3 time) they are so engaged.

4 ‘‘(2) EXPENSES.—While conducting the busi5 ness of the Scientific Advisory Committee away from

6 their homes or regular places of business, each mem7 ber may be allowed travel expenses, including per

8 diem in lieu of subsistence, as authorized by section

9 5703 of title 5 of the United States Code for per10 sons in the Government service employed intermit11 tently.

12 ‘‘(d) DUTIES.—The Scientific Advisory Committee

13 shall—

14 ‘‘(1) assist the Secretary in establishing,

15 amending, or revoking performance standards under

16 section 514(a)(3);

17 ‘‘(2) examine and determine the effects of the

18 alteration of the nicotine yield levels in tobacco prod19 ucts;

20 ‘‘(3) examine and determine whether there is a

21 threshold level below which nicotine yields do not

22 produce dependence on the tobacco product involved,

23 and, if so, determine what that level is; and
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1 ‘‘(4) review other safety, dependence or health

2 issues relating to tobacco products as determined ap3 propriate by the Secretary.

4 ‘‘SEC. 906. REQUIREMENTS RELATING TO NICOTINE AND

5 OTHER CONSTITUENTS.

6 ‘‘(a) GENERAL RULE.—The Secretary may adopt a

7 performance standard under section 514(a)(3) that re8 quires the modification of a tobacco product in a manner

9 that involves—

10 ‘‘(1) the reduction or elimination of nicotine

11 yields of the product; or

12 ‘‘(2) the reduction or elimination of other con13 stituents or harmful components of the product.

14 ‘‘(b) TOBACCO CONSTITUENTS.—The Secretary shall

15 promulgate regulations for the testing, reporting and dis16 closure of tobacco smoke constituents that the Secretary

17 determines the public should be informed of to protect

18 public health, including tar, nicotine, and carbon mon19 oxide. Such regulations may require label and advertising

20 disclosures relating to tar and nicotine.

21 ‘‘(c) LIMITATION ON TAR.—Not later than 3 years

22 after the date of enactment of this chapter, the Secretary

23 shall promulgate regulations that limit the amount of tar

24 in a cigarette to no more than 12 milligrams. Nothing in

25 the preceding sentence shall be construed as limiting the
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1 authority of the Secretary to promulgate regulations fur2 ther limiting the amount of tar that may be contained in

3 a cigarette.

4 ‘‘SEC. 907. REDUCED RISK PRODUCTS.

5 ‘‘(a) MISBRANDING.—Except as provided in sub6 section (b), the regulations promulgated in accordance

7 with section 904(a) shall require that a tobacco product

8 be deemed to be misbranded if the labeling of the package

9 of the product, or the claims of the manufacturer in con10 nection with the product, can reasonably be interpreted

11 by an objective consumer as stating or implying that the

12 product presents a reduced health risk as compared to

13 other similar products.

14 ‘‘(b) EXCEPTION.—

15 ‘‘(1) IN GENERAL.—Subsection (a) shall not

16 apply to the labeling of a tobacco product, or the

17 claims of the manufacturer in connection with the

18 product, if—

19 ‘‘(A) the manufacturer, based on the best

20 available scientific evidence, demonstrates to

21 the Commissioner that the product significantly

22 reduces the risk to the health of the user as

23 compared to other similar tobacco products;

24 and
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1 ‘‘(B) the Commissioner approves the spe2 cific claim that will be made a part of the label3 ing of the product, or the specific claims of the

4 manufacturer in connection with the product.

5 ‘‘(2) REDUCTION IN HARM.—The Commissioner

6 shall promulgate regulations to permit the inclusion

7 of scientifically-based specific health claims on the

8 labeling of a tobacco product package, or the making

9 of such claims by the manufacturer in connection

10 with the product, where the Commissioner deter11 mines that the inclusion or making of such claims

12 would reduce harm to the public and otherwise pro13 mote public health.

14 ‘‘(c) DEVELOPMENT OF REDUCED RISK PRODUCT

15 TECHNOLOGY.—

16 ‘‘(1) NOTIFICATION OF COMMISSIONER.—The

17 manufacturer of a tobacco product shall provide

18 written notice to the Commissioner upon the devel19 opment or acquisition by the manufacturer of any

20 technology that would reduce the risk of such prod21 ucts to the health of the user.

22 ‘‘(2) CONFIDENTIALITY.—The Commissioner

23 shall promulgate regulations to provide a manufac24 turer with appropriate confidentiality protections

25 with respect to technology that is the subject of a
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1 notification under paragraph (1) that contains evi2 dence that the technology involved is in the early de3 velopmental stages.

4 ‘‘(3) LICENSING.—

5 ‘‘(A) IN GENERAL.—With respect to any

6 technology developed or acquired under para7 graph (1), the manufacturer shall—

8 ‘‘(i) use such technology in the manu9 facture of its tobacco products; or

10 ‘‘(ii) permit the use of such tech11 nology (for a reasonable fee) by other man12 ufacturers of tobacco products to which

13 this chapter applies.

14 ‘‘(B) FEES.—The Commissioner shall pro15 mulgate regulations to provide for the payment

16 of a commercially reasonable fee by each manu17 facturer that uses the technology described

18 under subparagraph (A) to the manufacturer

19 that submits the notice under paragraph (1) for

20 such technology. Such regulations shall contain

21 procedures for the resolution of fee disputes be22 tween manufacturers under this subparagraph.

23 ‘‘(d) REQUIREMENT OF MANUFACTURE AND MAR24 KETING.—
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1 ‘‘(1) PURPOSE.—It is the purpose of this sub2 section to provide for a mechanism to ensure that

3 tobacco products that are designed to be less hazard4 ous to the health of users are developed, tested, and

5 made available to consumers.

6 ‘‘(2) DETERMINATION.—Upon a determination

7 by the Commissioner that the manufacture of a to8 bacco product that is less hazardous to the health of

9 users is technologically feasible, the Commissioner

10 may, in accordance with this subsection, require that

11 certain manufacturers of such products manufacture

12 and market such less hazardous products.

13 ‘‘(3) MANUFACTURER.—

14 ‘‘(A) REQUIREMENT.—Except as provided

15 in subparagraph (B), the requirement under

16 paragraph (2) shall apply to any manufacturer

17 that provides a notification to the Commissioner

18 under subsection (c)(1) concerning the tech19 nology that is the subject of the determination

20 of the Commissioner.

21 ‘‘(B) EXCEPTION.—The requirement under

22 subparagraph (A) shall not apply to a manufac23 turer if—

24 ‘‘(i) the manufacturer elects not to

25 manufacture such products and provides
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1 notice to the Commissioner of such elec2 tion; and

3 ‘‘(ii) the manufacturer agrees to pro4 vide the technology involved, for a commer5 cially reasonable fee, to other manufactur6 ers that enter into agreements to use such

7 technology to manufacture and market to8 bacco products that are less hazardous to

9 the health of users.

10 ‘‘SEC. 908. GOOD MANUFACTURING PRACTICE STANDARDS.

11 ‘‘(a) AUTHORITY.—

12 ‘‘(1) IN GENERAL.—The Secretary may, in ac13 cordance with paragraph (2), prescribe regulations

14 requiring that the methods used in, and the facilities

15 and controls used for, the manufacture, pre-produc16 tion design validation (including a process to assess

17 the performance of a tobacco product), packing, and

18 storage of a tobacco product conform to current

19 good manufacturing practice, as prescribed in such

20 regulations, to ensure that such products will be in

21 compliance with this chapter.

22 ‘‘(2) REQUIREMENTS PRIOR TO REGULA23 TIONS.—Prior to the Secretary promulgating any

24 regulation under paragraph (1) the Secretary

25 shall—
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1 ‘‘(A) afford the Scientific Advisory Com2 mittee established under section 905 an oppor3 tunity (with a reasonable time period) to submit

4 recommendations with respect to the regula5 tions proposed to be promulgated; and

6 ‘‘(B) afford an opportunity for an oral

7 hearing.

8 ‘‘(b) MINIMUM REQUIREMENTS.—The regulations

9 promulgated under subsection (a) shall at a minimum re10 quire—

11 ‘‘(1) the implementation of a quality control

12 system by the manufacturer of a tobacco product;

13 ‘‘(2) a process for the inspection, in accordance

14 with this Act, of tobacco product material prior to

15 the packaging of such product;

16 ‘‘(3) procedures for the proper handling and

17 storage of the packaged tobacco product;

18 ‘‘(4) after consultation with the Administrator

19 of the Environmental Protection Agency, the devel20 opment and adherence to applicable tolerances with

21 respect to pesticide chemical residues in or on com22 modities used by the manufacturer in the manufac23 ture of the finished tobacco product;
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1 ‘‘(5) the inspection of facilities by officials of

2 the Food and Drug Administration as otherwise pro3 vided for in this Act; and

4 ‘‘(6) record keeping and the reporting of certain

5 information.

6 ‘‘(c) PETITIONS FOR EXEMPTIONS AND

7 VARIANCES.—

8 ‘‘(1) IN GENERAL.—Any person subject to any

9 requirement prescribed by regulations under sub10 section (a) may petition the Secretary for an exemp11 tion or variance from such requirement. Such a peti12 tion shall be submitted to the Secretary in such form

13 and manner as the Secretary shall prescribe and

14 shall—

15 ‘‘(A) in the case of a petition for an ex16 emption from a requirement, set forth the basis

17 for the petitioner’s determination that compli18 ance with the requirement is not required to en19 sure that the device is in compliance with this

20 chapter;

21 ‘‘(B) in the case of a petition for a vari22 ance from a requirement, set forth the methods

23 proposed to be used in, and the facilities and

24 controls proposed to be used for, the manufac25 ture, packing, and storage of the product in lieu
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1 of the methods, facilities, and controls pre2 scribed by the requirement; and

3 ‘‘(C) contain such other information as the

4 Secretary shall prescribe.

5 ‘‘(2) SCIENTIFIC ADVISORY COMMITTEE.—The

6 Secretary may refer to the Scientific Advisory Com7 mittee established under section 905 any petition

8 submitted under paragraph (1). The Scientific Advi9 sory Committee shall report its recommendations to

10 the Secretary with respect to a petition referred to

11 it within 60 days of the date of the petition’s refer12 ral. Within 60 days after—

13 ‘‘(A) the date the petition was submitted

14 to the Secretary under paragraph (1); or

15 ‘‘(B) if the petition was referred to the Sci16 entific Advisory Committee, the expiration of

17 the 60-day period beginning on the date the pe18 tition was referred to such Committee;

19 whichever occurs later, the Secretary shall by order

20 either deny the petition or approve it.

21 ‘‘(3) APPROVAL OF PETITION.—

22 ‘‘(A) IN GENERAL.—The Secretary may

23 approve—

24 ‘‘(i) a petition for an exemption for a

25 tobacco product from a requirement if the
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1 Secretary determines that compliance with

2 such requirement is not required to assure

3 that the product will comply with this

4 chapter; and

5 ‘‘(ii) a petition for a variance for a to6 bacco product from a requirement if the

7 Secretary determines that the methods to

8 be used in, and the facilities and controls

9 to be used for, the manufacture, packing,

10 and storage of the product in lieu of the

11 methods, controls, and facilities prescribed

12 by the requirement are sufficient to ensure

13 that the product will comply with this

14 chapter.

15 ‘‘(B) CONDITIONS.—An order of the Sec16 retary approving a petition for a variance shall

17 prescribe such conditions respecting the meth18 ods used in, and the facilities and controls used

19 for, the manufacture, packing, and storage of

20 the tobacco product to be granted the variance

21 under the petition as may be necessary to en22 sure that the product will comply with this

23 chapter.

24 ‘‘(4) INFORMAL HEARING.—After the issuance

25 of an order under paragraph (2) respecting a peti-
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1 tion, the petitioner shall have an opportunity for an

2 informal hearing on such order.

3 ‘‘(d) AGRICULTURAL PRODUCERS.—The Secretary

4 may not promulgate any regulation under this section that

5 has the effect of placing regulatory burdens on tobacco

6 producers (as such term is used for purposes of the Agri7 cultural Adjustment Act of 1938 (7 U.S.C. 1281 et seq.)

8 and the Agricultural Act of 1949 (7 U.S.C. 1441 et seq.))

9 in excess of the regulatory burdens generally placed on

10 other agricultural commodity producers.

11 ‘‘SEC. 909. DISCLOSURE AND REPORTING OF NONTOBACCO

12 INGREDIENTS AND CONSTITUENTS.

13 ‘‘(a) DISCLOSURE OF ALL INGREDIENTS.—

14 ‘‘(1) IMMEDIATE AND ANNUAL DISCLOSURE.—

15 Not later than 30 days after the date of enactment

16 of this chapter, and annually thereafter, each manu17 facturer of a tobacco product shall submit to the

18 Secretary an ingredient list for all brands of tobacco

19 products that contains the information described in

20 paragraph (2).

21 ‘‘(2) REQUIREMENTS.—The list described in

22 paragraph (1) shall, with respect to each brand of

23 tobacco product of a manufacturer, include

24 ‘‘(A) a list of all ingredients, constituents,

25 substances, and compounds that are added to
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1 the tobacco (and the paper or filter of the prod2 uct if applicable) in the manufacture of the to3 bacco product, for each brand of tobacco prod4 uct so manufactured;

5 ‘‘(B) a description of the quantity of the

6 ingredients, constituents, substances, and com7 pounds that are listed under subparagraph (A)

8 with respect to each brand of tobacco product;

9 ‘‘(C) a description of the nicotine content

10 of the product, measured in milligrams of nico11 tine;

12 ‘‘(D) with respect to cigarettes a descrip13 tion of—

14 ‘‘(i) the filter ventilation percentage

15 (the level of air dilution in the cigarette as

16 provided by the ventilation holes in the fil17 ter, described as a percentage);

18 ‘‘(ii) the pH level of the smoke of the

19 cigarette; and

20 ‘‘(iii) the nicotine delivery level under

21 average smoking conditions reported in

22 milligrams of nicotine per cigarette;

23 ‘‘(E) with respect to smokeless tobacco

24 products a description of—

25 ‘‘(i) the pH level of the tobacco;
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1 ‘‘(ii) the moisture content of the to2 bacco expressed as a percentage of the

3 weight of the tobacco; and

4 ‘‘(iii) the nicotine content—

5 ‘‘(I) for each gram of the prod6 uct, measured in milligrams of nico7 tine;

8 ‘‘(II) expressed as a percentage

9 of the dry weight of the tobacco; and

10 ‘‘(III) with respect to unionized

11 (free) nicotine, expressed as a percent12 age per gram of the tobacco and ex13 pressed in milligrams per gram of the

14 tobacco; and

15 ‘‘(F) any other information determined ap16 propriate by the Secretary.

17 ‘‘(b) SAFETY ASSESSMENTS.—

18 ‘‘(1) APPLICATION TO NEW INGREDIENTS.—

19 ‘‘(A) IN GENERAL.—Not later than 1 year

20 after the date of enactment of this chapter, and

21 annually thereafter, each manufacturer shall

22 submit to the Secretary a safety assessment for

23 each new ingredient, constituent, substance, or

24 compound that such manufacturer desires to

25 make a part of a tobacco product. Such new in-
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1 gredient, constituent, substance, or compound

2 shall not be included in a tobacco product prior

3 to approval of such a safety assessment.

4 ‘‘(B) DEFINITION OF NEW INGREDIENT.—

5 For purposes of subparagraph (A), the term

6 ‘new ingredient, constituent, substance, or

7 compound’ means an ingredient, constituent

8 substance, or compound listed under subsection

9 (a)(1) that was not used in the brand of to10 bacco product involved prior to the date of en11 actment of this chapter.

12 ‘‘(2) APPLICATION TO OTHER INGREDIENTS.—

13 With respect to the application of this section to in14 gredients, constituents substances, or compounds

15 listed under subsection (a) to which paragraph (1)

16 does not apply, all such ingredients, constituents,

17 substances, or compounds shall be approved through

18 the safety assessment process within the 5-year pe19 riod beginning on the date of enactment of this

20 chapter. The Secretary shall develop a procedure

21 that staggers the percentage of such ingredients,

22 constituents, substances, or compounds for which

23 safety assessments must be submitted for approval

24 by manufacturers in each year.
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1 ‘‘(3) BASIS OF ASSESSMENT.—The safety as2 sessment of an ingredient, constituents, substance,

3 or compound described in paragraphs (1) and (2)

4 shall—

5 ‘‘(A) be based on the best scientific evi6 dence available at the time of the submission of

7 the assessment; and

8 ‘‘(B) result in a finding that there is a rea9 sonable certainty in the minds of competent sci10 entists that the ingredient, constituents, sub11 stance, or compound is not harmful in the

12 quantities used under the intended conditions of

13 use.

14 ‘‘(c) PROHIBITION.—

15 ‘‘(1) REGULATIONS.—Not later than 12 months

16 after the date of enactment of this chapter, the Sec17 retary shall promulgate regulations to prohibit the

18 use of any ingredient, constituent, substance, or

19 compound in the tobacco product of a manufac20 turer—

21 ‘‘(A) if no safety assessment has been sub22 mitted by the manufacturer for the ingredient,

23 constituent, substance, or compound as other24 wise required under this section;
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1 ‘‘(B) if the Secretary disapproves of the

2 safety of the ingredient, constituent, substance,

3 or compound that was the subject of the assess4 ment under paragraph (2); or

5 ‘‘(C) if such ingredient, constituent, sub6 stance, or compound is a new ingredient that

7 has not been approved for use by the Secretary.

8 ‘‘(2) REVIEW OF ASSESSMENTS.—

9 ‘‘(A) GENERAL REVIEW.—Not later than

10 180 days after the receipt of a safety assess11 ment under subsection (b), the Secretary shall

12 review the findings contained in such assess13 ment and approve or disapprove of the safety of

14 the ingredient, constituents, substance, or

15 compound that was the subject of the assess16 ment. The Secretary may, for good cause, ex17 tend the period for such approval. The Sec18 retary shall provide notice to the manufacturer

19 of an action under this subparagraph.

20 ‘‘(B) INACTION BY SECRETARY.—If the

21 Secretary fails to act with respect to an assess22 ment of an existing ingredient, constituent, sub23 stance, or additive during the period referred to

24 in subparagraph (A), the manufacturer of the

25 tobacco product involved may continue to use
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1 the ingredient, constituents, substance, or

2 compound involved until such time as the Sec3 retary makes a determination with respect to

4 the assessment.

5 ‘‘(d) DISCLOSURE OF INGREDIENTS TO THE PUB6 LIC.—

7 ‘‘(1) INITIAL DISCLOSURE.—The regulations

8 promulgated in accordance with section 904(a) shall,

9 at a minimum, require that a tobacco product be

10 deemed to be misbranded if the labeling of the pack11 age of such product does not disclose all ingredients,

12 constituents, substances, or compounds contained in

13 the product in accordance with regulations promul14 gated by the Secretary.

15 ‘‘(2) DISCLOSURE OF PERCENTAGE OF DOMES16 TIC AND FOREIGN TOBACCO.—The regulations re17 ferred to in paragraph (1) shall, at a minimum, re18 quire that a tobacco product be deemed to be mis19 branded if the labeling of the package of such prod20 uct does not disclose, with respect to the tobacco

21 contained in the product—

22 ‘‘(A) the percentage that is domestic to23 bacco; and

24 ‘‘(B) the percentage that is foreign to25 bacco.
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1 ‘‘(e) CONFIDENTIALITY.—

2 ‘‘(1) PETITION BY MANUFACTURER.—Upon the

3 submission of a list under subsection (a), a manufac4 turer may petition the Secretary to exempt certain

5 ingredients, constituents, substances, or compounds

6 on such list from public disclosure under subsection

7 (e) on the basis that such information should be con8 sidered confidential as a trade secret. Such petition

9 may be accompanied by such data as the manufac10 turer elects to submit.

11 ‘‘(2) DETERMINATION.—Not later than 60 days

12 after receiving a petition under paragraph (1), the

13 Secretary, in consultation with the Attorney General,

14 shall make a determination with respect to whether

15 the information described in the petition should be

16 exempt from disclosure under paragraph (1) as a

17 trade secret. The Secretary shall provide the manu18 facturer involved with notice of such determination.

19 but the decision of the Secretary shall be final.

20 ‘‘(3) PROCEDURES FOR CONFIDENTIAL INFOR21 MATION.—The Secretary shall develop procedures to

22 maintain the confidentiality of information that is

23 treated as a trade secret under a determination

24 under paragraph (2). Such procedures shall in25 clude—
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1 ‘‘(A) a requirement that such information

2 be maintained in a secure facility; and

3 ‘‘(B) a requirement that only the Sec4 retary, or the authorized agents of the Sec5 retary, will have access to the information and

6 shall be instructed to maintain the confidential7 ity of such information.

8 ‘‘(4) HEALTH DISCLOSURE.—Notwithstanding

9 a determination under paragraph (2), the Secretary

10 may require that any ingredient, constituents, sub11 stance, or compound contained in a tobacco product

12 that is determined to be exempt from disclosure as

13 a trade secret be disclosed if the Secretary deter14 mines that such ingredient, constituents, substance,

15 or compound is not safe as provided for in sub16 section (d).

17 ‘‘(5) OTHER DISCLOSURE.—Any information

18 that the Secretary determines is not subject to dis19 closure to the public under this subsection, shall be

20 exempt from disclosure pursuant to subsection (a) of

21 section 552 of title 5, United States Code, by reason

22 of subsection (b)(4) of such section, and shall be

23 considered confidential and shall not be disclosed,

24 except that such information may be disclosed to

25 other officers or employees as provided for in para-
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1 graph (3)(B) or when relevant in any proceeding

2 under this Act.

3 ‘‘SEC. 910. TOBACCO PRODUCT WARNINGS, LABELING AND

4 PACKAGING.

5 ‘‘(a) CIGARETTE WARNINGS.—

6 ‘‘(1) IN GENERAL.—

7 ‘‘(A) PACKAGING.—It shall be unlawful for

8 any person to manufacture, package, or import

9 for sale or distribution within the United States

10 any cigarettes the package of which fails to

11 bear, in accordance with the requirements of

12 this subsection, one of the following labels:

13 ‘‘WARNING: Cigarettes Are Addictive.

14 ‘‘WARNING: Tobacco Smoke Can Harm

15 Your Children.

16 ‘‘WARNING: Cigarettes Cause Fatal Lung

17 Disease.

18 ‘‘WARNING: Cigarettes Cause Cancer.

19 ‘‘WARNING: Cigarettes Cause Strokes

20 And Heart Disease.

21 ‘‘WARNING: Smoking During Pregnancy

22 Can Harm Your Baby.

23 ‘‘WARNING: Smoking Can Kill You.

24 ‘‘WARNING: Tobacco Smoke Causes

25 Fatal Lung Disease In Nonsmokers.
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1 ‘‘WARNING: Quitting Smoking Now

2 Greatly Reduces Serious Risks To Your

3 Health.

4 ‘‘(B) ADVERTISING.—It shall be unlawful

5 for any manufacturer or importer of cigarettes

6 to advertise or cause to be advertised within the

7 United States any cigarette unless the advertis8 ing bears, in accordance with the requirements

9 of this subsection, one of the following labels:

10 ‘‘WARNING: Cigarettes Are Addictive.

11 ‘‘WARNING: Tobacco Smoke Can Harm

12 Your Children.

13 ‘‘WARNING: Cigarettes Cause Fatal Lung

14 Disease.

15 ‘‘WARNING: Cigarettes Cause Cancer.

16 ‘‘WARNING: Cigarettes Cause Strokes

17 And Heart Disease.

18 ‘‘WARNING: Smoking During Pregnancy

19 Can Harm Your Baby.

20 ‘‘WARNING: Smoking Can Kill You.

21 ‘‘WARNING: Tobacco Smoke Causes

22 Fatal Lung Disease In Nonsmokers.

23 ‘‘WARNING: Quitting Smoking Now

24 Greatly Reduces Serious Risks To Your

25 Health.
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1 ‘‘(2) REQUIREMENTS FOR LABELING.—

2 ‘‘(A) LOCATION.—Each label statement re3 quired by subparagraph (A) of paragraph (1)

4 shall be located on the upper portion of the

5 front panel of the cigarette package (or carton)

6 and occupy not less than 25 percent of such

7 front panel.

8 ‘‘(B) TYPE AND COLOR.—With respect to

9 each label statement required by subparagraph

10 (A) of paragraph (1), the phrase ‘WARNING’

11 shall appear in capital letters and the label

12 statement shall be printed in 17 point type with

13 adjustments as determined appropriate by the

14 Secretary to reflect the length of the required

15 statement. All the letters in the label shall ap16 pear in conspicuous and legible type, in contrast

17 by typography, layout, or color with all other

18 printed material on the package, and be printed

19 in an alternating black-on-white and white-on20 black format as determined appropriate by the

21 Secretary.

22 ‘‘(C) EXCEPTION.—The provisions of sub23 paragraph (A) shall not apply in the case of a

24 flip-top cigarette package (offered for sale on

25 June 1, 1997) where the front portion of the
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1 flip-top does not comprise at least 25 percent of

2 the front panel. In the case of such a package,

3 the label statement required by subparagraph

4 (A) of paragraph (1) shall occupy the entire

5 front portion of the flip-top.

6 ‘‘(3) REQUIREMENTS FOR ADVERTISING.—

7 ‘‘(A) LOCATION.—Each label statement re8 quired by subparagraph (B) of paragraph (1)

9 shall occupy not less than 20 percent of the

10 area of the advertisement involved.

11 ‘‘(B) TYPE AND COLOR.—

12 ‘‘(i) TYPE.—With respect to each

13 label statement required by subparagraph

14 (B) of paragraph (1), the phrase ‘WARN15 ING’ shall appear in capital letters and the

16 label statement shall be printed in the fol17 lowing types:

18 ‘‘(I) With respect to whole page

19 advertisements on broadsheet news20 paper—45 point type.

21 ‘‘(II) With respect to half page

22 advertisements on broadsheet news23 paper—39 point type.
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1 ‘‘(III) With respect to whole page

2 advertisements on tabloid news3 paper—39 point type.

4 ‘‘(IV) With respect to half page

5 advertisements on tabloid news6 paper—27 point type.

7 ‘‘(V) With respect to DPS maga8 zine advertisements—31.5 point type.

9 ‘‘(VI) With respect to whole page

10 magazine advertisements—31.5 point

11 type.

12 ‘‘(VII) With respect to 28cm x 3

13 column advertisements—22.5 point

14 type.

15 ‘‘(VIII) With respect to 20cm x 2

16 column advertisements—15 point

17 type.

18 The Secretary may revise the required type

19 sizes as the Secretary determines appro20 priate within the 20 percent requirement.

21 ‘‘(ii) COLOR.—All the letters in the

22 label under this subparagraph shall appear

23 in conspicuous and legible type, in contrast

24 by typography, layout, or color with all

25 other printed material on the package, and
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1 be printed in an alternating black-on-white

2 and white-on-black format as determined

3 appropriate by the Secretary.

4 ‘‘(4) ROTATION OF LABEL STATEMENTS.—

5 ‘‘(A) IN GENERAL.—Except as provided in

6 subparagraph (B), the label statements speci7 fied in subparagraphs (A) and (B) of paragraph

8 (1) shall be rotated by each manufacturer or

9 importer of cigarettes quarterly in alternating

10 sequence on packages of each brand of ciga11 rettes manufactured by the manufacturer or

12 importer and in the advertisements for each

13 such brand of cigarettes in accordance with a

14 plan submitted by the manufacturer or im15 porter and approved by the Secretary. The Sec16 retary shall approve a plan submitted by a

17 manufacturer or importer of cigarettes which

18 will provide the rotation required by this para19 graph and which assures that all of the labels

20 required by subparagraphs (A) and (B) will be

21 displayed by the manufacturer or importer at

22 the same time.

23 ‘‘(B) APPLICATION OF OTHER ROTATION

24 REQUIREMENTS.—
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1 ‘‘(i) IN GENERAL.—A manufacturer

2 or importer of cigarettes may apply to the

3 Secretary to have the label rotation de4 scribed in clause (iii) apply with respect to

5 a brand style of cigarettes manufactured

6 or imported by such manufacturer or im7 porter if—

8 ‘‘(I) the number of cigarettes of

9 such brand style sold in the fiscal year

10 of the manufacturer or importer pre11 ceding the submission of the application is less than 1 12 ⁄4 of 1 percent of all

13 the cigarettes sold in the United

14 States in such year; and

‘‘(II) more than 1 15 ⁄2 of the ciga16 rettes manufactured or imported by

17 such manufacturer or importer for

18 sale in the United States are

19 packaged into brand styles which meet

20 the requirements of subclause (I).

21 If an application is approved by the Sec22 retary, the label rotation described in

23 clause (iii) shall apply with respect to the

24 applicant during the 1-year period begin-
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1 ning on the date of the application ap2 proval.

3 ‘‘(ii) PLAN.—An applicant under

4 clause (i) shall include in its application a

5 plan under which the label statements

6 specified in subparagraph (A) of paragraph

7 (1) will be rotated by the applicant manu8 facturer or importer in accordance with the

9 label rotation described in clause (iii).

10 ‘‘(iii) OTHER ROTATION REQUIRE11 MENTS.—Under the label rotation which

12 the manufacturer or importer with an ap13 proved application may put into effect,

14 each of the labels specified in subpara15 graph (A) of paragraph (1) shall appear on

16 the packages of each brand style of ciga17 rettes with respect to which the application

18 was approved an equal number of times

19 within the 12-month period beginning on

20 the date of the approval by the Secretary

21 of the application.

22 ‘‘(5) APPLICATION OF REQUIREMENT.—Para23 graph (1) does not apply to a distributor, a retailer

24 of cigarettes who does not manufacture, package, or
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1 import cigarettes for sale or distribution within the

2 United States.

3 ‘‘(6) TELEVISION AND RADIO ADVERTISING.—It

4 shall be unlawful to advertise cigarettes and little ci5 gars on any medium of electronic communications

6 subject to the jurisdiction of the Federal Commu7 nications Commission.

8 ‘‘(b) SMOKELESS TOBACCO PRODUCTS.—

9 ‘‘(1) IN GENERAL.—

10 ‘‘(A) PACKAGING.—It shall be unlawful for

11 any person to manufacture, package, or import

12 for sale or distribution within the United States

13 any smokeless tobacco product the package of

14 which fails to bear, in accordance with the re15 quirements of this subsection, one of the follow16 ing labels:

17 ‘‘WARNING: This Product Can Cause

18 Mouth Cancer.

19 ‘‘WARNING: This Product Can Kill You.

20 ‘‘WARNING: This Product Can Cause

21 Gum Disease And Tooth Loss.

22 ‘‘WARNING: This Product Is Not A Safe

23 Alternative To Cigarettes.

24 ‘‘WARNING: This Product Contains Can25 cer-Causing Chemicals.
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1 ‘‘WARNING: Smokeless Tobacco Is Ad2 dictive.

3 ‘‘(B) ADVERTISING.—It shall be unlawful

4 for any manufacturer or importer of smokeless

5 tobacco products to advertise or cause to be ad6 vertised within the United States any smokeless

7 tobacco product unless the advertising bears, in

8 accordance with the requirements of this sub9 section, one of the following labels:

10 ‘‘WARNING: This Product Can Cause

11 Mouth Cancer.

12 ‘‘WARNING: This Product Can Kill You.

13 ‘‘WARNING: This Product Can Cause

14 Gum Disease And Tooth Loss.

15 ‘‘WARNING: This Product Is Not A Safe

16 Alternative To Cigarettes.

17 ‘‘WARNING: This Product Contains Can18 cer-Causing Chemicals.

19 ‘‘WARNING: Smokeless Tobacco Is Ad20 dictive.

21 ‘‘(2) REQUIREMENTS FOR LABELING.—

22 ‘‘(A) LOCATION.—Each label statement re23 quired by subparagraph (A) of paragraph (1)

24 shall be located on the principal display panel
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1 of the product and occupy not less than 25 per2 cent of such panel.

3 ‘‘(B) TYPE AND COLOR.—With respect to

4 each label statement required by subparagraph

5 (A) of paragraph (1), the phrase ‘WARNING’

6 shall appear in capital letters and the label

7 statement shall be printed in 17 point type with

8 adjustments as determined appropriate by the

9 Secretary to reflect the length of the required

10 statement. All the letters in the label shall ap11 pear in conspicuous and legible type in contrast

12 by typography, layout, or color with all other

13 printed material on the package and be printed

14 in an alternating black on white and white on

15 black format as determined appropriate by the

16 Secretary.

17 ‘‘(3) ADVERTISING AND ROTATION.—The provi18 sions of paragraph (3) and (4)(A) of subsection (a)

19 shall apply to advertisements for smokeless tobacco

20 products and the rotation of the label statements re21 quired under paragraph (1)(A) on such products.

22 ‘‘(4) APPLICATION OF REQUIREMENT.—Para23 graph (1) does not apply to a distributor or a re24 tailer of smokeless tobacco products who does not
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1 manufacture, package, or import such products for

2 sale or distribution within the United States.

3 ‘‘(5) TELEVISION AND RADIO ADVERTISING.—It

4 shall be unlawful to advertise smokeless tobacco on

5 any medium of electronic communications subject to

6 the jurisdiction of the Federal Communications

7 Commission.

8 ‘‘(c) ENFORCEMENT.—Not later than 180 days after

9 the date of the enactment of this title, the Secretary shall

10 promulgate such regulations as may be necessary to en11 force subsections (a) and (b).

12 ‘‘(d) INJUNCTIONS.—The several district courts of

13 the United States are vested with jurisdiction, for cause

14 shown, to prevent and restrain violations of this section

15 upon the application of the Secretary in the case of a viola16 tion of subsection (a) or (b).

17 ‘‘(e) CONSTRUCTION.—

18 ‘‘(1) IN GENERAL.—Noting in this section shall

19 be construed to limit the ability of the Secretary the

20 change the text or layout of any of the warning

21 statements, or any of the labeling provisions, under

22 subsections (a) and (b), if determined necessary by

23 the Secretary.

24 ‘‘(2) UNFAIR ACTS.—Nothing in this section

25 (other than the requirements of subsections (a) and
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1 (b)) shall be construed to limit or restrict the au2 thority of the Secretary with respect to unfair or de3 ceptive acts or practices in the advertising of ciga4 rettes or smokeless tobacco products.

5 ‘‘(f) LIMITED PREEMPTION.—

6 ‘‘(1) STATE AND LOCAL ACTION.—

7 ‘‘(A) LIMITATION.—No warning label with

8 respect to cigarettes or smokeless tobacco prod9 ucts, other than the warning labels required by

10 subsections (a) and (b), shall be required by

11 any State or local statute or regulation to be in12 cluded on any package or in any advertisement

13 of cigarettes or a smokeless tobacco product.

14 ‘‘(B) RULE OF CONSTRUCTION.—Nothing

15 in this section shall be construed as prohibiting

16 a State or political subdivision of a State from

17 enacting statutes or regulations concerning

18 cigarettes or smokeless tobacco products so long

19 as such statutes or regulations do not conflict

20 with the labeling and advertising requirements

21 of this section or require additional statements

22 on cigarette or smokeless tobacco packages.

23 ‘‘(2) EFFECT ON LIABILITY LAW.—Except as

24 otherwise provided in this section, nothing in this

25 section shall relieve any person from liability at com-
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1 mon law or under State statutory law to any other

2 person.

3 ‘‘(g) REPORTS.—Not later than 1 year after the date

4 of enactment of this chapter, and biennially thereafter, the

5 Secretary shall prepare and submit to Congress a report

6 containing—

7 ‘‘(1) a description of the effects of health edu8 cation efforts on the use of cigarettes and smokeless

9 tobacco products;

10 ‘‘(2) a description of the use by the public of

11 cigarettes and smokeless tobacco products;

12 ‘‘(3) an evaluation of the health effects of ciga13 rettes and smokeless tobacco products and the iden14 tification of areas appropriate for further research;

15 and

16 ‘‘(4) such recommendations for legislation and

17 administrative action as the Secretary considers ap18 propriate.

19 ‘‘(h) EXPORTS.—Packages of cigarettes or smokeless

20 tobacco products manufactured, imported, or packaged—

21 ‘‘(1) for export from the United States; or

22 ‘‘(2) for delivery to a vessel or aircraft, as sup23 plies, for consumption beyond the jurisdiction of the

24 internal revenue laws of the United States;
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1 shall be exempt from the requirements of this chapter, but

2 such exemptions shall not apply to cigarettes or smokeless

3 tobacco products manufactured, imported, or packaged for

4 sale or distribution to members or units of the Armed

5 Forces of the United States located outside of the United

6 States.

7 ‘‘(i) APPLICATION.—The Secretary shall exercise the

8 authority provided for in this section notwithstanding the

9 provisions of the Federal Cigarette Labeling and Advertis10 ing Act (15 U.S.C. 1331 et seq.) and the Comprehensive

11 Smokeless Tobacco Health Education Act of 1986 (15

12 U.S.C. 4401 et seq.).

13 ‘‘SEC. 911. STATEMENT OF INTENDED USE.

14 ‘‘(a) REQUIREMENT.—Each manufacturer, distribu15 tor, and retailer advertising or causing to be advertised,

16 disseminating or causing to be disseminated, advertising

17 concerning cigarettes, cigarette tobacco, or smokeless to18 bacco products otherwise permitted under this chapter

19 shall include, as provided in section 502, the established

20 name of the product and a statement of the intended use

21 of the product as provided for in subsection (b).

22 ‘‘(b) USE STATEMENTS.—

23 ‘‘(1) CIGARETTES.—A statement of intended

24 use for cigarettes or cigarette tobacco is as follows

25 (whichever is appropriate):
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1 ‘‘Cigarettes—A Nicotine-Delivery Device for

2 Persons 18 or Older.

3 ‘‘Cigarette Tobacco—A Nicotine-Delivery De4 vice for Persons 18 or Older.

5 ‘‘(2) SMOKELESS TOBACCO.—A statement of in6 tended use for a smokeless tobacco product is as fol7 lows (whichever is appropriate):

8 ‘‘Loose Leaf Chewing Tobacco—A Nicotine-De9 livery Device for Persons 18 or Older.

10 ‘‘Plug Chewing Tobacco—A Nicotine-Delivery

11 Device for Persons 18 or Older.

12 ‘‘Twist Chewing Tobacco—A Nicotine-Delivery

13 Device for Persons 18 or Older.

14 ‘‘Moist Snuff—A Nicotine-Delivery Device for

15 Persons 18 or Older.

16 ‘‘Dry Snuff—A Nicotine-Delivery Device for

17 Persons 18 or Older.

18 ‘‘(c) TYPE AND LOCATION.—The Secretary shall pro19 mulgate regulations with respect to the type, color, size,

20 and placement of statements required under this section

21 on labels and in advertisements.

22 ‘‘SEC. 912. MISCELLANEOUS PROVISIONS.

23 ‘‘(a) PRESERVATION OF STATE AND LOCAL AUTHOR24 ITY.—Except as otherwise provided for in this chapter,

25 nothing in this chapter shall be construed as prohibiting
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1 a State from imposing requirements, prohibitions, pen2 alties or other measures to further the purposes of this

3 chapter that are in addition to the requirements, prohibi4 tions, or penalties required under this chapter. To the ex5 tent not inconsistent with the purposes of this chapter,

6 State and local governments may impose additional to7 bacco product control measures to further restrict or limit

8 the use of such products by minors.

9 ‘‘(b) REGULATIONS.—The Secretary may promulgate

10 regulations to enforce the provisions of this chapter, or

11 to modify, alter, or expand the requirements and protec12 tions provided for in this chapter if the Secretary deter13 mines that such modifications, alternations, or expansion

14 is necessary.’’.

15 TITLE III—STANDARDS TO RE16 DUCE INVOLUNTARY EXPO17 SURE TO TOBACCO SMOKE

18 SEC. 301. STANDARDS TO REDUCE INVOLUNTARY EXPO19 SURE TO TOBACCO SMOKE.

20 The Occupational Safety and Health Act of 1970 (29

21 U.S.C. 651 et seq.) is amended by adding at the end the

22 following:

23 ‘‘SEC. 35. STANDARDS TO REDUCE INVOLUNTARY EXPO24 SURE TO TOBACCO SMOKE.

25 ‘‘(a) DEFINITIONS.—In this section—
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1 ‘‘(1) PUBLIC FACILITY.—

2 ‘‘(A) IN GENERAL.—The term ‘public facil3 ity’ means any building regularly entered by 10

4 or more individuals at least 1 day per week, in5 cluding any such building owned by or leased to

6 a Federal, State, or local government entity.

7 Such term shall not include any building or

8 portion thereof regularly used for residential

9 purposes.

10 ‘‘(B) EXCLUSIONS.—The term ‘public fa11 cility’ does not include a portion of a building

12 which is used as a bar, tobacco merchant, a

13 hotel guest room that is designated as a smok14 ing room, or prison.

15 ‘‘(2) RESPONSIBLE ENTITY.—The term ‘respon16 sible entity’ means, with respect to any public facil17 ity, the owner of such facility except that, in the

18 case of any such facility or portion thereof which is

19 leased, such term means the lessee.

20 ‘‘(b) SMOKE-FREE ENVIRONMENT POLICY.—

21 ‘‘(1) POLICY REQUIRED.—In order to protect

22 children and adults from cancer, respiratory disease,

23 heart disease, and other adverse health effects from

24 breathing environmental tobacco smoke, the respon25 sible entity for each public facility shall adopt and
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1 implement at such facility a smoke-free environment

2 policy which meets the requirements of paragraph

3 (2) or (4).

4 ‘‘(2) ELEMENTS OF POLICY.—

5 ‘‘(A) IN GENERAL.—Each smoke-free envi6 ronment policy for a public facility shall—

7 ‘‘(i) prohibit the smoking of ciga8 rettes, cigars, and pipes, and any other

9 combustion of tobacco within the facility

10 and on facility property within the imme11 diate vicinity of the entrance to the facility;

12 and

13 ‘‘(ii) post a clear and prominent no14 tice of the smoking prohibition in appro15 priate and visible locations at the public fa16 cility.

17 ‘‘(B) EXCEPTION.—The smoke-free envi18 ronment policy for a public facility may provide

19 an exception to the prohibition specified in sub20 paragraph (A) for 1 or more specially des21 ignated smoking areas within a public facility if

22 such area or areas meet the requirements of

23 paragraph (3).
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1 ‘‘(3) SPECIALLY DESIGNATED SMOKING

2 AREAS.—A specially designated smoking area meets

3 the requirements of this subsection if—

4 ‘‘(A) the area is ventilated in accordance

5 with specifications promulgated by the Sec6 retary of Labor that ensure that air from the

7 area is directly exhausted to the outside and

8 does not recirculate or drift to other areas with9 in the public facility;

10 ‘‘(B) the area is maintained at negative

11 pressure, as compared to adjoined nonsmoking

12 areas, as determined under regulations promul13 gated by the Secretary of Labor; and

14 ‘‘(C) nonsmoking individuals do not have

15 to enter the area for any purpose while smoking

16 is occurring in such area.

17 Cleaning and maintenance work shall be conducted

18 in such area only while no smoking is occurring in

19 the area.

20 ‘‘(4) SPECIAL RULES.—

21 ‘‘(A) SCHOOLS AND OTHER FACILITIES

22 SERVING CHILDREN.—

23 ‘‘(i) IN GENERAL.—With respect to a

24 facility described in clause (ii), the respon25 sible entity for the facility shall adopt and
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1 implement at such facility a smoke-free en2 vironment policy that—

3 ‘‘(I) prohibits the smoking of

4 cigarettes, cigars, and pipes, and any

5 other combustion of tobacco within

6 the facility and on facility property;

7 ‘‘(II) prohibits the use of smoke8 less tobacco products within the facil9 ity and on facility property; and

10 ‘‘(III) post a clear and prominent

11 notice of the smoking and smokeless

12 tobacco prohibition in appropriate and

13 visible locations at the public facility.

14 ‘‘(ii) FACILITY.—A facility described

15 in this clause is—

16 ‘‘(I) an elementary or secondary

17 school (as such term is defined in sec18 tion 14101 of the Elementary and

19 Secondary Education Act of 1965 (20

20 U.S.C. 8801);

21 ‘‘(II) any facility at which a

22 Head Start program or project is

23 being carried out under the Head

24 Start Act (42 U.S.C. 9831 et seq.);
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1 ‘‘(III) any facility at which a li2 censed or certified child care provider

3 provides child care services; and

4 ‘‘(IV) any recreation or other fa5 cility maintained primarily to provide

6 services to children as determined by

7 the Secretary of Labor.

8 ‘‘(B) PUBLIC TRANSPORTATION.—With re9 spect to any responsible entity which operates

10 conveyances of public transportation (including

11 bus, rail, aircraft, boat, or any other conveyance

12 determined appropriate by the Secretary of

13 Labor), the responsible entity shall adopt and

14 implement on such conveyances a smoke-free

15 environment policy that—

16 ‘‘(i) prohibits the smoking of ciga17 rettes, cigars, and pipes, and any other

18 combustion of tobacco within the convey19 ance and on property affiliated with the

20 conveyance; and

21 ‘‘(ii) post a clear and prominent no22 tice of the smoking prohibition in appro23 priate and visible locations on the convey24 ance.
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1 ‘‘(c) ENFORCEMENT.—To be eligible to receive funds

2 under title XXVIII of the Public Health Service Act, a

3 State shall have in effect laws or procedures to provide

4 for the enforcement of this section within the State. Such

5 laws or procedures shall permit aggrieved individuals to

6 enforce this section through administrative or judicial

7 means.

8 ‘‘(d) PREEMPTION.—Nothing in this section shall

9 preempt or otherwise affect any other Federal, State or

10 local law which provides protection from health hazards

11 from environmental tobacco smoke that are as least as

12 stringent as those provided for in this section.

13 ‘‘(e) REGULATIONS.—The Secretary of Labor is au14 thorized to promulgate such regulations as the Secretary

15 deems necessary to carry out this section.

16 ‘‘(f) EFFECTIVE DATE.—The provisions of this sec17 tion shall take effect on the date that is 1 year after the

18 date of enactment of this section.’’.

19 TITLE IV—TOBACCO MARKET

20 TRANSITION ASSISTANCE

21 SEC. 401. DEFINITIONS.

22 In this title:

23 (1) BUYOUT PAYMENT.—The term ‘‘buyout

24 payment’’ means a payment made under section

25 411, 412, or 413.
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1 (2) CONTRACT.—The term ‘‘contract’’ means a

2 contract entered into under section 411, 412, or

3 413.

4 (3) LEASE.—The term ‘‘lease’’ means a rental

5 of quota on either a cash rent or crop share basis.

6 (4) MARKETING YEAR.—The term ‘‘marketing

7 year’’ means—

8 (A) in the case of Flue-cured tobacco, the

9 period beginning July 1 and ending the follow10 ing June 30; and

11 (B) in the case of each other kind of to12 bacco, the period beginning October 1 and end13 ing the following September 30.

14 (5) QUOTA OWNER.—The term ‘‘quota owner’’

15 means a person that, at the time of entering into a

16 contract, owns quota provided by the Secretary.

17 (6) PRODUCER OF QUOTA.—The term ‘‘pro18 ducer of quota’’ means a person that during at least

19 3 of the 1993 through 1997 crops of tobacco (as de20 termined by the Secretary) that were subject to

21 quota—

22 (A) leased quota;

23 (B) shared in the risk of producing a crop

24 of tobacco; and

25 (C) marketed the tobacco subject to quota.
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1 (7) PRODUCER OF NON-TOBACCO QUOTA.—The

2 term ‘‘producer of non-tobacco quota’’ means a per3 son that during at least 1 of the crop years 1995

4 through 1997 grew and marketed tobacco not sub5 ject to quota.

6 (8) QUOTA.—The term ‘‘quota’’ means basic

7 marketing quota for tobacco determined by the Sec8 retary under the Agricultural Adjustment Act of

9 1938 (7 U.S.C. 1281 et seq.).

10 (9) QUOTA HOLDER.—The term ‘‘quota holder’’

11 means a producer that owns a farm for which a to12 bacco farm marketing quota or farm acreage allot13 ment was established under the Agricultural Adjust14 ment Act of 1938 (7 U.S.C. 1281 et seq.) for any

15 of the 1994, 1995, or 1996 crop years.

16 (10) QUOTA LESSEE.—The term ‘‘quota lessee’’

17 means—

18 (A) a producer that owns a farm that pro19 duced tobacco pursuant to a lease and transfer

20 to that farm of all or part of a tobacco farm

21 marketing quota or farm acreage allotment es22 tablished under the Agricultural Adjustment

23 Act of 1938 (7 U.S.C. 1281 et seq.) for any of

24 the 1994, 1995, or 1996 crop years; or
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1 (B) a producer that rented land from a

2 farm operator to produce tobacco under a to3 bacco farm marketing quota or farm acreage al4 lotment established under the Agricultural Ad5 justment Act of 1938 (7 U.S.C. 1281 et seq.)

6 for any of the 1994, 1995, or 1996 crop years.

7 (11) QUOTA TENANT.—The term ‘‘quota ten8 ant’’ means a producer that—

9 (A) is the principal producer, as deter10 mined by the Secretary, of tobacco on a farm

11 where tobacco is produced pursuant to a to12 bacco farm marketing quota or farm acreage al13 lotment established under the Agricultural Ad14 justment Act of 1938 (7 U.S.C. 1281 et seq.)

15 for any of the 1994, 1995, or 1996 crop years;

16 and

17 (B) is not a quota holder or quota lessee.

18 (12) SECRETARY.—In subtitles A and C, the

19 term ‘‘Secretary’’ means the Secretary of

20 Agriculture.

21 (13) STATE.—The term ‘‘State’’ means each of

22 the several States of the United States, the District

23 of Columbia, the Commonwealth of Puerto Rico, and

24 any other territory or possession of the United

25 States.
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1 (14) TOBACCO.—The term ‘‘tobacco’’ means

2 any kind of tobacco produced and marketed in the

3 United States.

4 (15) TOBACCO-GROWING STATE.—The term

5 ‘‘tobacco-growing State’’ means Georgia, Kentucky,

6 North Carolina, South Carolina, Tennessee, or

7 Virginia.

8 (16) TRANSITION PAYMENT.—The term ‘‘tran9 sition payment’’ means a payment made to a pro10 ducer under section 411, 412, or 413.

11 (17) UNITED STATES.—The term ‘‘United

12 States’’, when used in a geographical sense, means

13 all of the States.

14 Subtitle A—Tobacco Quota Buyout

15 Contracts and Producer Transi16 tion Payments

17 SEC. 411. QUOTA OWNER BUYOUT CONTRACTS.

18 (a) OFFER.—The Secretary shall offer to enter into

19 a quota buyout contract with the quota owner on each

20 farm to which a quota was assigned in 1997.

21 (b) TERMS.—

22 (1) RELINQUISHMENT OF QUOTA.—Under the

23 terms of the contract, the owner shall agree, in ex24 change for a buyout payment, to permanently relin25 quish the quota.
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1 (2) ELIGIBILITY FOR TOBACCO PROGRAM BENE2 FITS.—Neither the farm, in its current or future

3 ownership configuration, nor the contracting owner

4 shall be eligible for any tobacco program benefits

5 under the Agricultural Adjustment Act of 1938 (7

6 U.S.C. 1281 et seq.), or the Agricultural Act of

7 1949 (7 U.S.C. 1421 et seq.).

8 (c) PAYMENT CALCULATION.—The total amount of

9 the buyout payment made to a quota owner shall be deter10 mined by multiplying—

11 (1) $4; by

12 (2) the average quantity of basic quota assigned

13 to the farm during the period 1995 through 1997.

14 SEC. 412. PRODUCER TRANSITION PAYMENTS FOR QUOTA

15 TOBACCO.

16 (a) OFFER.—The Secretary shall offer to producers

17 of quota tobacco that do not own the quota, but were

18 quota lessees or quota tenants in 1997, producer transi19 tion payment contracts.

20 (b) TERMS.—Under the terms of the transition con21 tract, the producer shall agree, in exchange for a payment,

22 to permanently refrain from growing tobacco for which a

23 quota program is in effect.
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1 (c) PAYMENT CALCULATION.—The total amount of

2 the transition payment made to a producer shall be deter3 mined by multiplying—

4 (1) $4; by

5 (2) the average quantity of quota tobacco leased

6 or rented from quota owners during the period 1995

7 through 1997.

8 SEC. 413. PRODUCER TRANSITION PAYMENTS FOR NON9 QUOTA TOBACCO.

10 (a) OFFER.—The Secretary shall offer to producers

11 of nonquota tobacco a producer nonquota transition pay12 ment contract.

13 (b) TERMS.—Under the terms of the transition pay14 ment, the producer shall agree, in exchange for a payment,

15 to permanently refrain from growing tobacco for which a

16 quota program is in effect.

17 (c) PAYMENT CALCULATION.—The total amount of

18 the transition payment made to a producer shall be deter19 mined by multiplying—

20 (1) $4; by

21 (2) the average annual quantity of nonquota to22 bacco marketed during the period 1995 through

23 1997.
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1 SEC. 414. ELEMENTS OF CONTRACTS.

2 (a) COMMENCEMENT.—To the maximum extent prac3 ticable, the Secretary shall commence entering into con4 tracts under this subtitle not later than 90 days after the

5 date of enactment of this Act.

6 (b) DEADLINE.—The Secretary may not enter into

7 a contract under this subtitle after the date that is 3 years

8 after the date of enactment of this Act.

9 (c) BEGINNING DATE.—A contract under this sub10 title shall take effect and become binding beginning in the

11 tobacco marketing year following the year in which the

12 contract is entered into.

13 (d) TIME FOR PAYMENT.—A contract payment shall

14 be made not later than the date that is the beginning of

15 the marketing year in which the contract becomes binding,

16 or at any later time selected by the quota owner or

17 producer.

18 (e) PROHIBITION OF DOUBLE PAYMENTS.—In no

19 case shall a contract holder receive overlapping payments

20 as a quota owner and as a producer on the same tobacco.

21 Subtitle B—No Net Cost Tobacco

22 Program

23 SEC. 421. BUDGET DEFICIT ASSESSMENT.

24 Section 106(g)(1) of the Agricultural Act of 1949 (7

25 U.S.C. 1445(g)(1)) is amended—
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1 (1) by striking ‘‘only for each of the 1994

2 through 1998 crops’’ and inserting ‘‘for the 1998

3 and each subsequent crop’’; and

4 (2) by striking ‘‘equal to—’’ and all that follows

5 and inserting ‘‘equal to 1 or more amounts deter6 mined by the Secretary that are sufficient to cover

7 the costs of the administration of the tobacco quota

8 and price support programs administered by the

9 Secretary.’’.

10 Subtitle C—Tobacco Community

11 Empowerment Block Grants

12 SEC. 431. TOBACCO COMMUNITY EMPOWERMENT BLOCK

13 GRANTS.

14 (a) AUTHORITY.—The Secretary shall make grants to

15 tobacco States in accordance with this section to enable

16 the States to—

17 (1) empower active tobacco producers and to18 bacco product manufacturing workers by providing

19 economic alternatives to tobacco; and

20 (2) carry out non-tobacco economic development

21 initiatives in tobacco communities.

22 (b) APPLICATION.—To be eligible to receive payments

23 under this section, a tobacco State shall prepare and sub24 mit to the Secretary an application at such time, in such
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1 manner, and containing such information as the Secretary

2 may require, including—

3 (1) a description of the activities that the State

4 will carry out using amounts received under the

5 grant;

6 (2) a designation of an appropriate State agen7 cy to administer amounts received under the grant;

8 and

9 (3) a description of the steps to be taken to en10 sure that the funds are distributed in accordance

11 with subsection (e).

12 (c) AMOUNT OF GRANT.—

13 (1) IN GENERAL.—From the amounts available

14 to carry out this section for a fiscal year, the Sec15 retary shall allot to each tobacco State an amount

16 that bears the same ratio to the amounts available

17 as the total income of the State derived from the

18 production of tobacco and the manufacture of to19 bacco products during the 1994 through 1996 mar20 keting years (as determined under paragraph (2))

21 bears to the total income of all tobacco States de22 rived from the production of tobacco and the manu23 facturing of tobacco products during the 1994

24 through 1996 marketing years.
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1 (2) TOBACCO INCOME.—For the 1994 through

2 1996 marketing years, the Secretary shall determine

3 the amount of income derived from the production

4 of tobacco and the manufacture of tobacco products

5 in each tobacco State and in all tobacco States.

6 (d) PAYMENTS.—

7 (1) IN GENERAL.—A tobacco State that has an

8 application approved by the Secretary under sub9 section (b) shall be entitled to a payment under this

10 section in an amount that is equal to its allotment

11 under subsection (c).

12 (2) FORM OF PAYMENTS.—The Secretary may

13 make payments under this section to a tobacco State

14 in installments, and in advance or by way of reim15 bursement, with necessary adjustments on account

16 of overpayments or underpayments, as the Secretary

17 may determine.

18 (3) REALLOTMENTS.—Any portion of the allot19 ment of a tobacco State under subsection (c) that

20 the Secretary determines will not be used to carry

21 out this section in accordance with an approved

22 State application required under subsection (b), shall

23 be reallotted by the Secretary to other tobacco

24 States in proportion to the original allotments to the

25 other States.
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1 (e) USE AND DISTRIBUTION OF FUNDS.—

2 (1) IN GENERAL.—Amounts received by a to3 bacco State under this section shall be used to carry

4 out economic development activities, including—

5 (A) rural business enterprise activities de6 scribed in subsections (c) and (e) of section

7 310B of the Consolidated Farm and Rural De8 velopment Act (7 U.S.C. 1932);

9 (B) down payment loan assistance pro10 grams that are similar to the program described

11 in section 310E of the Consolidated Farm and

12 Rural Development Act (7 U.S.C. 1935);

13 (C) activities designed to help create pro14 ductive farm or off-farm employment in rural

15 areas to provide a more viable economic base

16 and enhance opportunities for improved in17 comes, living standards, and contributions by

18 rural individuals to the economic and social de19 velopment of tobacco communities;

20 (D) activities that expand existing infra21 structure, facilities, and services to capitalize on

22 opportunities to diversify economies in tobacco

23 communities and that support the development

24 of new industries or commercial ventures;
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1 (E) activities by agricultural organizations

2 that provide assistance directly to active tobacco

3 producers to assist in developing other agricul4 tural activities that supplement tobacco-produc5 ing activities;

6 (F) initiatives designed to create or expand

7 locally owned value-added processing and mar8 keting operations in tobacco communities;

9 (G) technical assistance activities by per10 sons to support farmer-owned enterprises, or

11 agriculture-based rural development enterprises,

12 of the type described in section 252 or 253 of

13 the Trade Act of 1974 (19 U.S.C. 2342, 2343);

14 and

15 (H) investments in community colleges and

16 trade schools to provide skills training to active

17 tobacco producers and tobacco product manu18 facturing workers and ensure that the off-farm

19 sector remains vital and robust.

20 (2) TOBACCO COUNTIES.—Assistance may be

21 provided by a tobacco State under this section only

22 to assist a county in the State that has been deter23 mined by the Secretary to have in excess of

24 $100,000 in income derived from the production of

25 tobacco and the manufacture of tobacco products
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1 during 1 or more of the 1994 through 1996 market2 ing years.

3 (3) DISTRIBUTION.—

4 (A) ECONOMIC DEVELOPMENT ACTIVI5 TIES.—Not less than 20 percent of the amounts

6 received by a tobacco State under this section

7 shall be used to carry out—

8 (i) economic development activities de9 scribed in subparagraph (E) or (F) of

10 paragraph (1); or

11 (ii) agriculture-based rural develop12 ment activities described in paragraph

13 (1)(G).

14 (B) TECHNICAL ASSISTANCE ACTIVI15 TIES.—Not less than 4 percent of the amounts

16 received by a tobacco State under this section

17 shall be used to carry out technical assistance

18 activities described in paragraph (1)(G).

19 (C) TOBACCO COUNTIES.—To be eligible to

20 receive payments under this section, a tobacco

21 State shall demonstrate to the Secretary that

22 funding will be provided, during the 1999

23 through 2004 fiscal years, for activities in each

24 county in the State that has been determined

25 under paragraph (2) to have in excess of
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1 $100,000 in income derived from the produc2 tion of tobacco and the manufacture of tobacco

3 products, in amounts that are at least equal to

4 the product obtained by multiplying—

5 (i) the ratio that the tobacco produc6 tion and tobacco product manufacturing

7 income in the county determined under

8 paragraph (2) bears to the total tobacco

9 production and tobacco product manufac10 turing income for the State determined

11 under subsection (c); by

12 (ii) 50 percent of the total amounts

13 received by the State under this section

14 during the 1999 through 2004 fiscal years.

15 TITLE V—MISCELLANEOUS

16 PROVISIONS

17 SEC. 501. SENSE OF THE SENATE.

18 It is the sense of the Senate that, in order to provide

19 funds to carry out this Act, Congress should enact an in20 crease in the excise taxes on tobacco products of approxi21 mately $1.50 per pack of cigarettes (and corresponding

22 increases on taxes on other tobacco products) over a 3-

23 year period, that increases in such tax in future years

24 should be indexed to inflation, and that the payment of

25 such tax should not be considered to be an ordinary and
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1 necessary expense in carrying on a trade or business and

2 should not be deductible.

Æ