I
107TH CONGRESS
2D SESSION
H. R. 3940
To eliminate the Federal quota and price support programs for tobacco,
to compensate quota holders and active producers for the loss of tobacco
quota asset value, to establish a permanent advisory board to determine
and describe the physical characteristics of United States farm-produced
tobacco and unmanufactured imported tobacco, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 12, 2002
Mr. MCINTYRE (for himself and Mr. TOM DAVIS of Virginia) introduced the
following bill; which was referred to the Committee on Agriculture, and
in addition to the Committee on Energy and Commerce, for a period to
be subsequently determined by the Speaker, in each case for consider-
ation of such provisions as fall within the jurisdiction of the committee
concerned
A BILL
To eliminate the Federal quota and price support programs
for tobacco, to compensate quota holders and active pro-
ducers for the loss of tobacco quota asset value, to estab-
lish a permanent advisory board to determine and de-
scribe the physical characteristics of United States farm-
produced tobacco and unmanufactured imported tobacco,
and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Tobacco Livelihood and Economic Assistance for our
Farmers Act of 2002’’.
(b) TABLE OF CONTENTS.—The table of contents for
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Severability.
TITLE I—TERMINATION OF CURRENT TOBACCO PROGRAMS
Sec. 101. Termination of marketing quota programs and repeal of related pro-
visions.
Sec. 102. Termination of tobacco price support loan and no net cost provisions
and repeal of related provisions.
Sec. 103. Geographical restrictions on expansion of tobacco production.
Sec. 104. Continued availability of Federal crop insurance.
TITLE II—PAYMENTS TO TOBACCO QUOTA HOLDERS AND
PRODUCERS
Sec. 201. Definitions.
Sec. 202. Payments to tobacco quota holders.
Sec. 203. Transition payments for active producers of quota tobacco.
TITLE III—TOBACCO QUALITY BOARD
Sec. 301. Establishment of Board.
Sec. 302. Membership.
Sec. 303. Duties.
Sec. 304. Administrative provisions.
TITLE IV—TOBACCO PRODUCT MANUFACTURER AND IMPORTER
USER FEES
Sec. 401. User fee.
Sec. 402. Allocation of user fees.
TITLE V—FDA REGULATION OF TOBACCO PRODUCTS
Sec. 501. Findings.
Sec. 502. Definitions.
Sec. 503. Amendment of Federal Food, Drug, and Cosmetic Act.
Sec. 504. Regulatory record.
Sec. 505. Conforming and other amendments to general provisions.
Sec. 506. Cigarette label and advertising warnings.
Sec. 507. Authority to revise cigarette warning label statements.
Sec. 508. Smokeless tobacco labels and advertising warnings.
Sec. 509. Authority to revise smokeless tobacco product warning label state-
ments.
Sec. 510. Tar, nicotine, and other smoke constituent disclosure to the public.
Sec. 511. Regulation requirement.
Sec. 512. FTC jurisdiction not affected.
SEC. 2. SEVERABILITY.
If any provision of this Act, or an amendment made
by this Act, or the application of such provision to any
person or circumstance, is held to be invalid, the remain-
der of this Act, or an amendment made by this Act, or
the application of such provision to other persons or cir-
cumstances, shall not be affected.
TITLE I—TERMINATION OF
CURRENT TOBACCO PROGRAMS
SEC. 101. TERMINATION OF MARKETING QUOTA PROGRAMS
AND REPEAL OF RELATED PROVISIONS.
(a) TOBACCO CONTROL ACT.—The Act of April 25,
1936 (commonly known as the Tobacco Control Act; 7
U.S.C. 515–515k), is repealed.
(b) COMMODITY HANDLING ORDERS.—Section 8c(2)
of the Agricultural Adjustment Act (7 U.S.C. 608c(2)),
reenacted with amendments by the Agricultural Marketing
Agreement Act of 1937, is amended by striking ‘‘to-
bacco,’’.
(c) PROCESSING TAX.—Section 9(b) of the Agricul-
tural Adjustment Act (7 U.S.C. 609(b)), reenacted with
amendments by the Agricultural Marketing Agreement
Act of 1937, is amended—
(1) in paragraph (2), by striking ‘‘tobacco,’’
(2) in paragraph (6)(B)(i), by striking ‘‘, or, in
the case of tobacco, is less than the fair exchange
value by not more than 10 per centum,’’.
(d) BURLEY TOBACCO IMPORT REVIEW.—Section 3
of Public Law 98–59 (7 U.S.C. 625) is repealed.
(e) DECLARATION OF POLICY.—Section 2 of the Ag-
ricultural Adjustment Act of 1938 (7 U.S.C. 1282) is
amended by striking ‘‘tobacco,’’.
(f) DEFINITIONS.—Section 301(b) of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1301(b)) is amended—
(1) in paragraph (3)—
(A) by striking subparagraph (C); and
(B) by redesignating subparagraph (D) as
subparagraph (C);
(2) in paragraph (6)(A), by striking ‘‘tobacco,’’;
(3) in paragraph (7), by striking the following:
‘‘Tobacco (flue-cured), July 1–June 30;
Tobacco (other than flue-cured), October 1–Sep-
tember 30);’’
(4) in paragraph (10)—
(A) by striking subparagraph (B); and
(B) by redesignating subparagraph (C) as
subparagraph (B);
(5) in paragraph (11)(B), by striking ‘‘and to-
bacco’’;
(6) in paragraph (12), by striking ‘‘tobacco,’’;
(7) in paragraph (14)—
(A) by striking ‘‘(A)’’ in subparagraph (A);
and
(B) by striking subparagraphs (B), (C),
and (D);
(8) by striking paragraph (15);
(9) in paragraph (16)—
(A) by striking subparagraph (B); and
(B) by redesignating subparagraph (C) as
subparagraph (B);
(10) by striking paragraph (17); and
(11) by redesignating paragraph (16) as para-
graph (15).
(g) PARITY PAYMENTS.—Section 303 of the Agricul-
tural Adjustment Act of 1938 (7 U.S.C. 1303) is amended
in the first sentence by striking ‘‘rice, or tobacco’’ and
inserting ‘‘or rice’’.
(h) MARKETING QUOTAS.—Part I of subtitle B of
title III of the Agricultural Adjustment Act of 1938 (7
U.S.C. 1311 et seq.) is repealed.
(i) ADMINISTRATIVE PROVISIONS.—Section 361 of
the Agricultural Adjustment Act of 1938 (7 U.S.C. 1361)
is amended by striking ‘‘tobacco,’’.
(j) ADJUSTMENT OF QUOTAS.—Section 371 of the
Agricultural Adjustment Act of 1938 (7 U.S.C. 1371) is
amended—
(1) in the first sentence of subsection (a) by
striking ‘‘peanuts, or tobacco’’ and inserting ‘‘or
peanuts’’; and
(2) in the first sentence of subsection (b), by
striking ‘‘peanuts or tobacco’’ and inserting ‘‘or pea-
nuts’’.
(k) REPORTS AND RECORDS.—Section 373 of the Ag-
ricultural Adjustment Act of 1938 (7 U.S.C. 1373) is
amended—
(1) by striking ‘‘peanuts, or tobacco’’ each place
it appears in subsections (a) and (b) and inserting
‘‘or peanuts’’; and
(2) in subsection (a)—
(A) in the first sentence by striking ‘‘all
persons engaged in the business of redrying,
prizing, or stemming tobacco for producers,’’;
and
(B) in the last sentence by striking ‘‘$500’’
and all that follows through the period at the
end of the sentence and inserting ‘‘$500.’’.
(l) REGULATIONS.—Section 375(a) of the Agricul-
tural Adjustment Act of 1938 (7 U.S.C. 1375(a)) is
amended by striking ‘‘peanuts, or tobacco’’ and inserting
‘‘or peanuts’’.
(m) EMINENT DOMAIN.—Section 378 of the Agricul-
tural Adjustment Act of 1938 (7 U.S.C. 1378) is
amended—
(1) in the first sentence of subsection (c) by
striking ‘‘cotton, tobacco, and peanuts’’ and insert-
ing ‘‘cotton and peanuts’’; and
(2) by striking subsections (d), (e), and (f).
(n) BURLEY TOBACCO FARM RECONSTITUTION.—
Section 379 of the Agricultural Adjustment Act of 1938
(7 U.S.C. 1379) is amended—
(1) in subsection (a)—
(A) by striking ‘‘(a)’’; and
(B) in paragraph (6) by striking ‘‘, but
this clause (6) shall not be applicable in the
case of burley tobacco’’; and
(2) by striking subsections (b) and (c).
(o) ACREAGE-POUNDAGE QUOTAS.—Section 4 of the
Act of April 16, 1955 (Public Law 89–12; 7 U.S.C. 1314c
note), is repealed.
(p) BURLEY TOBACCO ACREAGE ALLOTMENTS.—
The Act of July 12, 1952 (7 U.S.C. 1315), is repealed.
(q) TRANSFER OF ALLOTMENTS.—Section 703 of the
Food and Agriculture Act of 1965 (7 U.S.C. 1316) is re-
pealed.
(r) 
ADVANCE
RECOURSE
LOANS.—Section
13(a)(2)(B) of the Food Security Improvements Act of
1986 (7 U.S.C. 1433c–1(a)(2)(B)) is amended by striking
‘‘tobacco and’’.
(s) TOBACCO FIELD MEASUREMENT.—Section 1112
of the Omnibus Budget Reconciliation Act of 1987 (Public
Law 100–203) is amended by striking subsection (c).
(t) LIABILITY.—The amendments made by this sec-
tion shall not affect the liability of any person under any
provision of law in effect before the amendments take ef-
fect as provided under subsection (u).
(u) APPLICATION OF AMENDMENTS.—The amend-
ments made by this section shall apply with respect to the
2003 and subsequent tobacco crops.
SEC. 102. TERMINATION OF TOBACCO PRICE SUPPORT
LOAN AND NO NET COST PROVISIONS AND
REPEAL OF RELATED PROVISIONS.
(a) PARITY PRICE SUPPORT.—Section 101 of the Ag-
ricultural Act of 1949 (7 U.S.C. 1441) is amended—
(1) in the first sentence of subsection (a), by
striking ‘‘tobacco (except as otherwise provided here-
in), corn’’ and inserting ‘‘corn’’;
(2) by striking subsection (c);
(3) in subsection (d)(3)—
(A) by striking ‘‘, except tobacco,’’; and
(B) by striking ‘‘and no price support shall
be made available for any crop of tobacco for
which marketing quotas have been disapproved
by producers;’’; and
(4) by redesignating subsections (d) and (e) as
subsection (c) and (d), respectively.
(b) TERMINATION OF TOBACCO PRICE SUPPORT AND
NO NET COST PROVISIONS.—Sections 106, 106A, 106B,
and 106C of the Agricultural Act of 1949 (7 U.S.C. 1445,
1445–1, 1445–2, 1445–3) are repealed.
(c) DEFINITION
OF BASIC AGRICULTURAL COM-
MODITY.—Section 408(c) of the Agricultural Act of 1949
(7 U.S.C. 1428(c)) is amended by striking ‘‘tobacco,’’.
(d) REVIEW OF BURLEY TOBACCO IMPORTS.—Sec-
tion 3 of Public Law 98–59 (7 U.S.C. 625) is repealed.
(e) POWERS
OF COMMODITY CREDIT CORPORA-
TION.—Section 5 of the Commodity Credit Corporation
Charter Act (15 U.S.C. 714c) is amended by inserting
‘‘(other than tobacco)’’ after ‘‘agricultural commodities’’
each place it appears.
(f) TRANSITION PROVISIONS.—
lishment of tobacco no net cost funds and accounts,
respectively—
(A) any obligation of a tobacco producer,
purchaser, or importer to make payments into
any such fund or account also shall terminate;
and
(B) any monies in any such fund or ac-
count shall be disposed of in the manner pre-
scribed by the Secretary of Agriculture, except
that—
(i) to the extent needed, such monies
shall be applied or used for the purposes
therefor prescribed by such sections; and
(ii) if any monies remain, the Sec-
retary shall transfer such monies to the
Secretary of Health and Human Services
for use in accordance with section 402.
(g) APPLICATION OF AMENDMENTS.—This section
and the amendments made by this section shall apply with
respect to the 2003 and subsequent tobacco crops.
SEC. 103. GEOGRAPHICAL RESTRICTIONS ON EXPANSION
OF TOBACCO PRODUCTION.
(a) PURPOSE.—The purpose of this section is to pro-
vide an orderly economic transition away from the mar-
keting of tobacco based on quotas and price support while
also addressing the economic dislocation, and the resulting
impact on interstate commerce, that the termination of the
current tobacco program might cause in certain commu-
nities.
(b) PENALTY APPLICABLE TO TOBACCO GROWN IN
NONQUOTA COUNTIES AND STATES.—The marketing of
tobacco in the 2003 or subsequent marketing years, of a
kind of tobacco that was subject to a marketing quota in
the 2002 marketing year, shall be subject to a penalty
equal to 100 percent of the total amount received on the
marketing of the tobacco unless the tobacco was grown
in any county in which such kind of tobacco was grown
pursuant to a marketing quota in the 2002 marketing
year.
(c) DEFINITIONS.—In this section:
(1) The term ‘‘marketing year’’ means July 1
to June 30 for flue-cured tobacco and October 1 to
September 30 for all other kinds of tobacco.
(2) The term ‘‘marketing quota in the 2002
marketing year’’ means a quota established for that
year pursuant to part I of subtitle B of title III of
the Agricultural Adjustment Act of 1938 (7 U.S.C.
1311 et seq.) and related provisions, as in effect for
that marketing year.
SEC. 104. CONTINUED AVAILABILITY OF FEDERAL CROP IN-
SURANCE.
Nothing in this title shall be construed to affect the
eligibility of tobacco producers to obtain crop insurance
for their crops pursuant to the Federal Crop Insurance
Act (7 U.S.C. 1501 et seq.) under the terms of such Act.
TITLE 
II—PAYMENTS 
TO 
TO-
BACCO QUOTA HOLDERS AND
PRODUCERS
SEC. 201. DEFINITIONS.
In this title:
(1) The term ‘‘active producer of quota to-
bacco’’ means a person that was the actual pro-
ducer, as determined by the Secretary, of tobacco
marketed under a marketing quota for the 2001 to-
bacco marketing year.
(2) The term ‘‘quota tobacco’’ means a kind of
tobacco that is subject to farm marketing quotas or
farm acreage allotments for the 1999, 2000, 2001,
and 2002 tobacco marketing years under a mar-
keting quota or allotment program established under
part I of subtitle B of title III of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1281 et seq.).
(3) The term ‘‘Secretary’’ means the Secretary
of Agriculture.
(4) The term ‘‘tobacco quota holder’’ means an
owner of a farm on January 1, 2002, for which a
tobacco farm marketing quota or farm acreage allot-
ment for quota tobacco was established with respect
to the 2002 tobacco marketing year under a mar-
keting quota program established under part I of
subtitle B of title III of the Agricultural Adjustment
Act of 1938.
SEC. 202. PAYMENTS TO TOBACCO QUOTA HOLDERS.
(a) PAYMENT REQUIRED.—The Secretary shall make
payments to each eligible tobacco quota holder for the ter-
mination of tobacco marketing quotas and related price
support under title I, which shall constitute full and fair
compensation for any losses relating to such termination.
(b) ELIGIBILITY.—To be eligible to receive a payment
under this section, a person shall submit to the Secretary
an application containing such information as the Sec-
retary may require to demonstrate to the satisfaction of
the Secretary that the person satisfies the definition of
tobacco quota holder. The application shall be submitted
within such time, in such form, and in such manner as
the Secretary may require.
(c) BASE QUOTA LEVEL.—
(1) IN GENERAL.—The Secretary shall establish
a base quota level applicable to each eligible tobacco
quota holder, as determined under subsection (b).
(2) POUNDAGE QUOTAS.—For each kind of to-
bacco for which the marketing quota is expressed in
pounds, the base quota level for each tobacco quota
holder shall be equal to the basic tobacco marketing
quota under the Agriculture Adjustment Act of 1938
for the 1998 marketing year for quota tobacco on
the farm owned by the tobacco quota holder.
(3) MARKETING QUOTAS OTHER THAN POUND-
AGE QUOTAS.—For each kind of tobacco for which
there is marketing quota or allotment on an acreage
basis, the base quota level for each tobacco quota
holder shall be the amount equal to the product ob-
tained by multiplying—
(A) the basic tobacco farm marketing
quota or allotment for the 1998 marketing year
established by the Secretary for quota tobacco
on the farm owned by the tobacco quota holder;
by
(B) the average county production yield
per acre for the county in which the farm is lo-
cated for the kind of tobacco for the 1998 mar-
keting year.
(d) PAYMENT.—The Secretary shall make payments
to each eligible tobacco quota holder, as determined under
subsection (b), in a total amount equal to the product ob-
tained by multiplying—
(1) $8 per pound; by
(2) the base quota level established for the
quota holder under subsection (c).
(e) TIME FOR PAYMENT.—The payments to eligible
tobacco quota holders required under this section shall be
made in five equal installments during fiscal years 2003,
2004, 2005, 2006, and 2007.
(f) RESOLUTION OF DISPUTES.—Any dispute regard-
ing the eligibility of a person to receive a payment under
this section, or the amount of the payment, shall be re-
solved by the county committee established under section
8 of the Soil Conservation and Domestic Allotment Act
(16 U.S.C. 590h) for the county or other area in which
the farm owned by the person is located.
(g) COMMODITY CREDIT CORPORATION.—The Sec-
retary shall use the funds, facilities and authorities of the
Commodity Credit Corporation to carry out this section.
SEC. 203. TRANSITION PAYMENTS FOR ACTIVE PRODUCERS
OF QUOTA TOBACCO.
(a) TRANSITION PAYMENTS REQUIRED.—The Sec-
retary shall make transition payments under this section
to eligible active producers of quota tobacco.
(b) ELIGIBILITY.—To be eligible to receive a transi-
tion payment under this section, a person shall submit to
the Secretary an application containing such information
as the Secretary may require to demonstrate to the satis-
faction of the Secretary that the person satisfies the defi-
nition of active producer of quota tobacco. The application
shall be submitted within such time, in such form, and
in such manner as the Secretary may require.
(c) PRODUCTION BASE.—The Secretary shall estab-
lish a production base applicable to each eligible active
producer of quota tobacco, as determined under subsection
(b). A producer’s production base shall be equal to the
quantity, in pounds, of quota tobacco subject to the basic
marketing quota produced and marketed by the producer
under the Agriculture Adjustment Act of 1938 for the
2001 marketing year.
(d) PAYMENT.—The Secretary shall make payments
to each eligible active producer of quota tobacco, as deter-
mined under subsection (b), in a total amount equal to
the product obtained by multiplying—
(1) $4 per pound; by
(2) the production base established for the ac-
tive producer under subsection (c).
(e) TIME FOR PAYMENT.—The payments to eligible
active producers of quota tobacco required under this sec-
tion shall be made in five equal installments during fiscal
years 2003, 2004, 2005, 2006, and 2007.
(f) RESOLUTION OF DISPUTES.—Any dispute regard-
ing the eligibility of a person to receive a payment under
this section, or the amount of the payment, shall be re-
solved by the county committee established under section
8 of the Soil Conservation and Domestic Allotment Act
(16 U.S.C. 590h) for the county or other area in which
the farming operation of the person is located.
(g) COMMODITY CREDIT CORPORATION.—The Sec-
retary shall use the funds, facilities and authorities of the
Commodity Credit Corporation to carry out this section.
TITLE III—TOBACCO QUALITY
BOARD
SEC. 301. ESTABLISHMENT OF BOARD.
The Secretary of Agriculture (in this title referred to
as the ‘‘Secretary’’) shall establish a permanent advisory
board within the Department of Agriculture to be known
as the Tobacco Quality Board (in this title referred to as
the ‘‘Board’’).
SEC. 302. MEMBERSHIP.
(a) NOMINATION AND APPOINTMENT.—The Board
shall consist of 11 members, of which five shall be ap-
pointed by the Secretary from nominations submitted by
representatives of United States tobacco producers, five
shall be appointed by the Secretary from nominations sub-
mitted by representatives of United States tobacco prod-
uct manufacturers, and one shall be an officer or employee
of the Department of Agriculture appointed by the Sec-
retary (who shall serve as Chair of the Board).
(b) TERMS.—
(1) CHAIR.—The Chair of the Board shall serve
at the pleasure of the Secretary.
(2) OTHER MEMBERS.—Other members of the
Board shall serve for two-year terms, except that,
for the first appointments to the Board, two pro-
ducer representatives and two manufacturer rep-
resentatives shall have initial terms of one year.
SEC. 303. DUTIES.
The Board shall be responsible for—
(1) determining and describing the physical
characteristics of United States farm-produced to-
bacco and unmanufactured imported tobacco;
(2) assembling and evaluating, in a systematic
manner, concerns and problems with the quality of
United States tobacco, expressed by domestic and
foreign buyers and manufacturers of tobacco prod-
ucts;
(3) reviewing data collected by Federal agencies
on the physical and chemical integrity of United
States produced and imported unmanufactured to-
bacco, to ensure that tobacco being used in domesti-
cally-manufactured tobacco products is of the high-
est quality and is free from prohibited physical and
chemical agents;
(4) investigating and communicating to the
Secretary—
(A) conditions with respect to the produc-
tion of tobacco that discourage improvements in
the quality of United States produced tobacco;
and
(B) 
recommendations 
for 
regulatory
changes that would address tobacco quality
issues; and
(5) such other related activities assigned to it
by the Secretary.
SEC. 304. ADMINISTRATIVE PROVISIONS.
(a) STAFF.—The Secretary shall provide the Board
with staff experienced in the sampling and analysis of un-
manufactured tobacco and capable of collecting data and
monitoring tobacco production information, and such
other resources necessary for the Board to perform its du-
ties under this subtitle, as determined by the Secretary.
(b) COMMODITY CREDIT CORPORATION.—The Sec-
retary shall use the funds, facilities and authorities of the
Commodity Credit Corporation to carry out this title.
TITLE IV—TOBACCO PRODUCT
MANUFACTURER 
AND 
IM-
PORTER USER FEES
SEC. 401. USER FEE.
(a) IN GENERAL.—The Secretary of Health and
Human Services shall assess an annual user fee, cal-
culated in accordance with this section, upon each tobacco
product manufacturer and tobacco product importer that
sells tobacco products in domestic commerce in the United
States. The assessments shall commence during calendar
year 2003, based on domestic sales of tobacco products
during fiscal year 2003.
(b) BASE AMOUNT OF USER FEE FOR EACH CLASS
OF TOBACCO PRODUCT.—
(1) The base amount of the user fee for ciga-
rette 
manufacturers 
and 
importers 
shall 
be
$2,116,252,000.
(2) The base amount of the user fee for small
cigar 
manufacturers 
and 
importers 
shall 
be
$1,051,000.
(3) The base amount of the user fee for large
cigar 
manufacturers 
and 
importers 
shall 
be
$164,274,000.
(4) The base amount of the user fee for snuff
manufacturers and importers shall be $9,920,000.
(5) The base amount of the user fee for chew-
ing tobacco manufacturers and importers shall be
$2,275,000.
(6) The base amount of the user fee for pipe to-
bacco 
manufacturers 
and 
importers 
shall 
be
$1,505,000.
(7) The base amount of the user fee for roll-
your-own tobacco manufacturers and importers shall
be $3,231,000.
(c) DETERMINATION OF ANNUAL USER FEE FOR
EACH CLASS OF TOBACCO PRODUCT.—The total user fee
to be assessed upon, and paid by, the manufacturers and
importers of each class of tobacco product in each calendar
year, as allocated pursuant to subsection (d), shall be the
base amount for that class of tobacco product provided
in subsection (b) multiplied by a fraction—
(1) the numerator of which is the total volume
of domestic sales of that class of tobacco product in
the fiscal year ending on September 30 of that cal-
endar year; and
(2) the denominator of which is the total vol-
ume of domestic sales of that class of tobacco prod-
uct in fiscal year 2003.
(d) ALLOCATION OF TOTAL USER FEE AMOUNTS BY
MARKET SHARE—
(1) FORMULA.—The user fee for each class of
tobacco product to be paid by each manufacturer or
importer of that class of tobacco product under sub-
section (a) shall be determined in each year by
multiplying—
(A) such manufacturer’s or importer’s
market share, as calculated with respect to the
current calendar year, of that class of tobacco
product; by
(B) the total user fee amount for the cur-
rent calendar year, as determined under sub-
section (c), for that class of tobacco product.
(2) MARKET
SHARE
DEFINED.—In this sub-
section, the term ‘‘market share’’ for each manufac-
turer or importer of a class of tobacco product for
the purpose of the assessment to be calculated in the
current calendar year shall be equal to that manu-
facturer’s or importer’s respective share (expressed
as a decimal to the fourth place) of the total volume
of domestic sales of that class of tobacco product
during the calendar year immediately preceding the
year of such assessment.
(e) DETERMINATION
OF VOLUME
OF DOMESTIC
SALES.— The calculation of the volume of domestic sales
of a class of tobacco product by a manufacturer or im-
porter, and by all manufacturers and importers as a
group, shall be made by the Secretary of Health and
Human Services based on certified reports submitted by
such manufacturers and importers pursuant to subsection
(f). For purposes of the Secretary’s calculations under this
subsection and the certifications under subsection (f), the
volumes of domestic sales shall be measured, with respect
to cigarettes, in terms of the numbers of cigarettes sold,
or with respect to other classes of tobacco products, in
terms of such units as shall be specified by regulation by
the Secretary.
(f) CERTIFICATION
OF
VOLUME
OF
DOMESTIC
SALES.— Every manufacturer and importer of tobacco
products shall submit each year a certified report to the
Secretary of Health and Human Services setting forth for
each class of tobacco products the total, for the prior year,
of such manufacturer’s or importer’s domestic sales to
wholesalers and retailers and directly to consumers. These
certified reports must be submitted to the Secretary not
later than March 1 of the year after the year for which
the certified report is being made.
SEC. 402. ALLOCATION OF USER FEES.
(a) IN GENERAL.—The user fees collected pursuant
to section 401 and any funds transferred to the Secretary
of Health and Human Services by the Secretary of Agri-
culture pursuant to section 102(f)(3)(B) shall be available,
without further appropriation, in accordance with, and for
the purposes described, by this section. All such funds
shall remain available until expended.
(b) FUNDING FOR FDA REGULATION OF TOBACCO
PRODUCTS.—The Secretary of Health and Human Serv-
ices shall make 15 percent of the user fee amounts col-
lected pursuant to section 401 each year available to the
Food and Drug Administration for the regulation of to-
bacco products under chapter IX of the Federal Food,
Drug, and Cosmetic Act.
(c) FUNDING FOR OTHER TOBACCO-RELATED PRO-
GRAMS.—The Secretary of Health and Human Services
shall use the remaining 85 percent of the user fee amounts
collected each year pursuant to section 401 and any
amounts transferred to the Secretary by the Secretary of
Agriculture pursuant to section 102(f)(3)(B)—
(1) to reimburse the Commodity Credit Cor-
poration for the expenditures made by that agency
under title II of this Act; and
(2) to use the balance of such amounts, if any
such balance remains for any year after the reim-
bursement under paragraph (1), to fund any other
program that relates to tobacco products.
TITLE V—FDA REGULATION OF
TOBACCO PRODUCTS
SEC. 501. FINDINGS.
The Congress finds the following:
(1) The use of tobacco products by the Nation’s
children is a pediatric disease of epic proportions
that results in new generations of tobacco-dependent
children and adults.
(2) A consensus exists within the scientific and
medical communities that tobacco products are in-
herently dangerous and cause cancer, heart disease,
and other serious adverse health effects.
(3) Nicotine is addictive.
(4) Virtually all new users of tobacco products
are under the minimum legal age to purchase such
products.
(5) Tobacco advertising and marketing con-
tribute significantly to the use of nicotine-containing
tobacco products by adolescents.
(6) Because past efforts to restrict advertising
and marketing of tobacco products have failed ade-
quately to curb tobacco use by adolescents, com-
prehensive restrictions on the sale, promotion, and
distribution of such products are needed.
(7) Federal and State governments have lacked
the legal and regulatory authority and resources
they need to address comprehensively the public
health and societal problems caused by the use of to-
bacco products.
(8) Federal and State public health officials,
the public health community, and the public at large
recognize that the tobacco industry should be subject
to ongoing oversight.
(9) Under article I, section 8 of the Constitu-
tion, the Congress is vested with the responsibility
for regulating interstate commerce and commerce
with Indian tribes.
(10) The sale, distribution, marketing, adver-
tising, and use of tobacco products are activities in
and substantially affecting interstate commerce be-
cause they are sold, marketed, advertised, and dis-
tributed in interstate commerce on a nationwide
basis, and have a substantial effect on the Nation’s
economy.
(11) The sale, distribution, marketing, adver-
tising, and use of such products substantially affect
interstate commerce through the health care and
other costs attributable to the use of tobacco prod-
ucts.
(12) It is in the public interest for Congress to
adopt comprehensive public health legislation be-
cause of tobacco’s unique position in the Nation’s
history and economy and the need to prevent the
sale, distribution, marketing and advertising of to-
bacco products to persons under the minimum legal
age to purchase such products.
(13) The public interest requires a timely, fair,
equitable, and consistent result that will serve the
public interest by restricting throughout the Nation
the sale, distribution, marketing, and advertising of
tobacco products only to persons of legal age to pur-
chase such products.
(14) Public health authorities estimate that the
benefits to the Nation of enacting Federal legislation
to accomplish these goals would be significant in
human and economic terms.
(15) Reducing the use of tobacco by minors by
50 percent would prevent well over 60,000 early
deaths each year and save up to $43 billion each
year in reduced medical costs, improved productivity,
and the avoidance of premature deaths.
(16) Advertising, marketing, and promotion of
tobacco products have been especially directed to at-
tract young persons to use tobacco products and
these efforts have resulted in increased use of such
products by youth. Past efforts to oversee these ac-
tivities have not been successful in adequately pre-
venting such increased use.
(17) Tobacco advertising increases the size of
the tobacco market by increasing consumption of to-
bacco products including increasing tobacco use by
young people.
(18) Children are more influenced by tobacco
advertising than adults and they smoke the most ad-
vertised brands.
(19) Tobacco company documents indicate that
young people are an important and often crucial seg-
ment of the tobacco market.
(20) Advertising restrictions will have a positive
effect on the smoking rates of young people.