Tobacco Documents Online

Harvard Universit In 1972 ~we,madtI` a Wttt nual payme Mr. Horace Kornegay, President The Tobacco Institute 1776 K Street, N. W. Washington, D. C., 20006 SUITE .12 1101 lEYENTELNTNIlTREET, N. W. WAfMINGYON, 0. O. 20036 Mardh 17, 1978 bject commitment in the amount of $27,927.05 nts of $5,585.41. U. C. L. A. Project The U'. C. L. A. project began in 1974 and our con- tributions have been annual payments of $5000.00 ~` The Council for Tobacco Research This Council for Tobacco Research project began prior to 1962 and our contributions have been at an annual rate of $6,250.00. Dear Horace: TELEIC.6a361 CAELL7i TiOIAfIN WAiNINGTON-O. 0.. For a number of years Tobacco Associates has been proud'to be associated with the domestic manufacturers and a token contributor to the following healith research projects: ~ Washington University Project The WashingtonlUniversity project began in 1971' in- cluding our 5-year commitment of $125,000, or $25,000 annua All of these projects have been most helpful d'uring this period of vicious healith attacks against the industry. Our affiliation in them has been of mutual benefilt to Tobacco Associates and the tobacco industry. Tobacco Associates is financed by a grower assessment of'$1.00 for each 2000 lbs. of farm production. In 1974 when our income was approximately $750,000 annually we began, at the insistence of the producers, suppliementilng in the 5-state producing area pro- duction a'nd'marketing research in the amount of approximately $200,000 annually pro-rated back to the states in ratio to pro- duction. Since 1974 the marketing quota has been cut 10'percent and 12 per- cent followed in 1977 due to drought one of the shortest crops in recent years. The maximum quota in 1978 is 1182'million pounds.

2- ( March 17, 1978 The primary function of Tobacco Associates is the promotion of flue-cured tobacco in export trade. In line with this premise we have overseas cooperator-industry market development projects in excess of $409,000 annually. I am sure that you can fully appre- ciate our difficulty in maintaining the status quo in view of the purchasing power of the declining dollar. The Board of Directors has given our export promotion top~priority with second place going to producer production and marketing re- search. At the same time they are unwilling to budget money that is not available, and have already reduced the producer research program for 1978. In view of the above economic facts of life we would like to suspend our support to the Harvard University and~the Council for Tobacco Research in 1978. We are now in the process of preparing legislation to be introduced in North Carolina which will permit us to increase our producer assessment. However, once the authority is granted it must be approved by 2/3 of the producers in the next scheduled referendum which will be held in 1980 and effective with the 1981 crop. Please convey to the domestic manufacturers that this decision is strictly economic and is no reflection on the good work of these projects. We pledge our complete and continued cooperation to the extent of our financial resources. . Sincerely, ~ l-j zP << ,~ f oe ~: f.Wrlliams , p-As.ident