I 
108TH CONGRESS 
1ST SESSION H. R. 1566
To replace the existing Federal price support and quota programs for flue-
cured and burley tobacco with a licensing program designed to assist 
the actual producers of flue-cured and burley tobacco, and for other 
purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 2, 2003
Mr. COBLE introduced the following bill; which was referred to the Committee 
on Agriculture 
A BILL 
To replace the existing Federal price support and quota 
programs for flue-cured and burley tobacco with a licens-
ing program designed to assist the actual producers of 
flue-cured and burley 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 
‘‘Phase III Implementation Act’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings and Purpose. 
TITLE I—TOBACCO PRODUCTION LICENSES 
Sec. 101. Definitions of historic tobacco producer and licensed tobacco pro-
ducer. 
Sec. 102. National estimate of tobacco production levels. 
Sec. 103. National tobacco marketing factor. 
Sec. 104. Issuance of tobacco production licenses. 
Sec. 105. Annual authorized tobacco production under tobacco production li-
censes. 
Sec. 106. Termination of flue-cured and burley quota programs. 
Sec. 107. Program Referenda. 
Sec. 108. Effective date. 
TITLE II—TOBACCO COST OF PRODUCTION SUPPORT 
Sec. 201. Tobacco Cost of Production Calculation. 
Sec. 202. Effective date.
SEC. 2. FINDINGS AND PURPOSE. 
(a) FINDINGS.—Congress finds the following: 
(1) Tobacco production is conducted extensively 
in a number of States and generates significant in-
come in local communities in these States, which 
have historically relied on such production for eco-
nomic vitality. 
(2) Tobacco products manufactured from to-
bacco grown in these States are transported in inter-
state commerce. 
(3) Domestic trends affecting tobacco produc-
tion have had a disproportionately harsh impact on 
small family farms and on their communities. 
(4) The Federal tobacco program has become 
inefficient and has operated to keep a significant 
portion of tobacco production rights in the hands of
individuals who are not directly involved in tobacco 
production. 
(5) The continuation of a Federal tobacco sup-
ply management program is in the best interests of 
family farm operations that seek to continue to 
produce tobacco leaf. 
(6) Any efforts to assist flue-cured and burley 
tobacco growers in making a transition to a stable 
future economic environment must include mod-
ernization of the Federal tobacco program. 
(b) PURPOSE.—It is the purpose of this Act to mod-
ernize the Federal supply management program for flue-
cured and burley tobacco producers by shifting tobacco 
leaf production rights into the hands of active flue-cured 
and burley tobacco growers. 
TITLE I—TOBACCO PRODUCTION 
LICENSES 
SEC. 101. DEFINITIONS OF HISTORIC TOBACCO PRODUCER 
AND LICENSED TOBACCO PRODUCER. 
In this title: 
(1) The term ‘‘historic tobacco producer’’ 
means an owner, operator, landlord, tenant, or 
sharecropper who bore, individually or collectively, 
the risk of producing a crop of flue-cured or burley 
tobacco on a farm for the 2003 crop year.
(2) The term ‘‘licensed tobacco producer’’ 
means an owner, operator, landlord, tenant, or 
sharecropper who holds a license issued under this 
title—
(A) to plant a crop of flue-cured or burley 
tobacco on a farm in a specified county for the 
2004 or a subsequent crop year; and 
(B) to harvest and market an authorized 
quantity of flue-cured or burley tobacco. 
SEC. 102. NATIONAL ESTIMATE OF TOBACCO PRODUCTION 
LEVELS. 
(a) ANNUAL CALCULATION.—
(1) For the 2004 and each subsequent crop of 
flue-cured and burley tobacco, the Secretary of Agri-
culture shall determine and announce the national 
estimate for each type of flue-cured and burley to-
bacco, as calculated under this section, that the Sec-
retary estimates will be utilized during the mar-
keting year. 
(2) Not later than December 15 of each cal-
endar year with respect to flue-cured tobacco, and 
February 1 of each year with respect to burley to-
bacco, the Secretary shall announce the national es-
timate.
(3) The national estimate of flue-cured or bur-
ley tobacco for any marketing year shall be the 
quantity of flue-cured or burley tobacco, as deter-
mined by the Secretary, that is not more than 103 
percent nor less than 97 percent of the total of—
(A) the aggregate of quantities of flue-
cured or burley tobacco that domestic manufac-
turers of cigarettes estimate the manufacturers 
intend to purchase on the United States auction 
markets or from producers during the mar-
keting year, as compiled and determined under 
subsection (b); 
(B) the average annual quantity of flue-
cured or burley tobacco exported from the 
United States during the 3 marketing years im-
mediately preceding the marketing year for 
which the determination is being made; and 
(C) the quantity, if any, of flue-cured or 
burley tobacco that the Secretary, in the discre-
tion of the Secretary, determines is necessary to 
increase or decrease the inventories of the pro-
ducer-owned cooperative marketing associations 
that have entered into loan agreements with the 
Commodity Credit Corporation to make price 
support available to producers of flue-cured or
burley tobacco to establish or maintain such in-
ventories, in the aggregate, at the reserve sup-
ply level for flue-cured or burley tobacco.
(b) MANUFACTURER PURCHASE ESTIMATES.—Not 
later than December 1 of each calendar year with respect 
to flue-cured tobacco, and January 15 of each calendar 
year with respect to burley tobacco, each domestic manu-
facturer of cigarettes shall submit to the Secretary of Ag-
riculture a statement, by kind, of the quantity of flue-
cured tobacco and burley tobacco that the manufacturer 
intends to purchase, directly or indirectly, on the United 
States auction markets or from licensed tobacco producers 
during the next marketing year. 
(c) FAILURE TO SUBMIT, OR UNDER-PURCHASE OF, 
PURCHASE INTENTIONS.—
(1) A domestic manufacturer of cigarettes shall 
be subject to the penalty under paragraph (2) if 
such manufacturer fails to—
(A) submit to the Secretary of Agriculture 
purchase intentions as required under sub-
section (b) for a marketing year, but subse-
quently purchases tobacco on the United States 
auction markets or from licensed tobacco pro-
ducers during that marketing year, or