Both Phase I and Phase II of the Master Settlement contain provisions and funding targeted towards farmers, quota owners, and tobacco dependent communities. Both phases propose the establishment of foundations in North Carolina which could compensate those involved in the tobacco economy for the loss of income due to changes in the tobacco economy. These are still very open-ended regarding how any money would be structured and distributed, though money is scheduled to begin arriving in North Carolina within the next couple of months.

For the sake of discussion, RAFI has compiled the following list of options which are currently being considered. We do not specifically endorse any of these options. What we do encourage is that farmers and other tobacco community members educate themselves on these options and make their concerns known to their General Assembly members. No single one of these options is the perfect solution for everyone; some mix of options is the most likely policy outcome. There may also be other options not on this list. Please add your ideas to the discussion:

 

1. Compensate growers for reduced acreage. This would allow growers to pay down debts accumulated for higher levels of production.
   
   
2. Provide quota owners with compensation for reduced production. Consider different rates of compensation for different levels of quota (for example, $5/lb. for the first 20,000 pounds, $4/lb. for the next 20,000 pounds, etc.) so those who rely on quota income for basic income are covered first.
   
   
3. Connect quota compensation with phasing quota owners out of the production system and the establishment of a "privatized" tobacco program. The privatized program, known as the Robb plan in the debate over the 1998 McCain bill in Congress, controlled tobacco production through a licensing system rather than rental of quota. This would maintain a supply control program which could support the price of tobacco, while removing the price of quota rental from production costs.
   
   
4. Cost-share grants and low interest loans for development of agricultural enterprises by those who want to remain in farming. Match these with technical and business development support.
   
   
5. Provide funds to communities for feasibility studies and development of value-added processing and marketing operations for agricultural-based enterprises.
   
   
6. Provide support for putting together farmland conservation plans which conserve farmland for future use, preserve assets and income value for heirs, and provide tax savings to landowners who wish to retire.
   
   
7. Improve health insurance and public health services for farm families in transition; provide mental and other medical health services to farm families who run the risk of having a higher incidence of stress related diseases, suicide, family violence, substance abuse and farm accidents.
   
   
8. Involve the broad spectrum of local communities in any non-agricultural economic development decisions for tobacco-dependent communities. Assure full, diverse local representation. Have a clear, accessible process to present ideas and apply for support.
   
   
9. Maintain the tobacco program and lock in purchase intentions for as long as possible. Expand the tobacco cooperative to provide bargaining power for its members over a broader range of commodities and/or issues.
   
   
10. You own suggestion: let us know your ideas.

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