USDA WILL ISSUE TOBACCO TRANSITION PAYMENT PROGRAM PAYMENTS

The following excerpt is from the U.S. Department of Agriculture e-mail:


"WASHINGTON, Jan. 13, 2012— The U.S. Department of Agriculture (USDA) announced today it will begin issuing Tobacco Transition Payment Program (TTPP) payments to quota holders and producers. Quota holders and producers can enter into successor-in-interest contracts beginning Jan. 17, 2012, which would enable them to receive lump-sum payments from private entities by selling the remaining three TTPP payments.

A total of approximately $7.2 billion will have been paid to tobacco quota holders and producers with this seventh round of payments. The payments announced today represent more than $950 million. The TTPP marks the end of the federal tobacco marketing quota and price support loan programs in place since the Great Depression. The Fair and Equitable Tobacco Reform Act, enacted in October 2004, established this program.

The TTPP is funded by assessments on tobacco product importers and manufacturers. The program, begun in 2005, ends in 2014, and provides 10 equal annual payments to quota holders and producers.

USDA does not make lump sum TTPP payments to quota holders and producers. However, quota holders and producers can receive lump sum payments by selling their interest to a third party through “successor-in-interest” contracts. Since 2005, third parties bought more than 170,000 TTPP contracts worth more than $3 billion."




The following excerpt is from the FDA website and may help to define and clarify the governments justification for the  TTPP:

"The Tobacco Transition Payment Program (TTPP), also called the "tobacco buy-out," helps tobacco quota holders and producers transition to the free market.

 

The Fair and Equitable Tobacco Reform Act of 2004 (P.L. 108-357), signed by President Bush on Oct. 22, 2004, ended the Depression-era tobacco quota program and established the TTPP. The program provides annual transitional payments for 10 years to eligible tobacco quota holders and producers. Payments began in 2005 and continue through 2014. Payments are funded through assessments of approximately $10 billion on tobacco product manufacturers and importers."