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April i, 1977 MEMO: TO: FROM: Monthly Report on Status Management Group and Executive Committee Ralph Murphine This report and the appended material is intended to provide a • picture of the status of the project at this moment and of our plans for the month of April. CITIZENS COMMITTEE We now have 40 members of the committee (see Appendix i, attached) and 384 potential committee members. We are currently trying to continue recruitment by telephone, with a follow-up letter from Chairman Paul Curran issuing an invitation to join to those who appear interested. We intend to send a "cold" letter to all those who have not yet been reached during the coming week (Apr. 4) and, then, follow-up by telephone. All of these names (active and potential) have been entered into the computer system. Citizens Committee event, telephone and mail activity statistical summaries are attached (see Appendix 2). We intend to continue recruitment among selected special groups. We are collecting the list of District Attorneys who will receive a letter from Paul Curran inviting them to join, and a telephone follow-up, invitations have already been sent to members of the financial community from manufacturers finance executives to a luncheon at 12:15 PM, Tuesday, April 12, at the Drake Hotel, 56th Street and Park Avenue. Bernie Ruggieri, our lobbyist, Rita Rodin, our Citizens Committee COordinator, other support staff, and I will attend this event in order to brief the group and recruit them into the program. More than i00 have been invited to attend. We are continuing to pursue the Chamber of Commerce, but we are impeded somewhat by their failure to understand the nature of the problem. This past week the Chamber sent us a copy of their Eleventh Interim Report to the Mayor by the Temporary Commission on City Finances, pages 26 to 35 of which deal with the cigarette bootlegging problem and its effect on city taxes. Its analysis is Based, however, on the FIRST State Task Force Report and the ACIR Report (Advance Copy) and not on the, hopefully more accurate, second report. I have scheduled a meeting with the Research Director of this group, Mary McCormick, in order to bring her up to date. Since several of our Citizens Committee members ( LewisRudin, Marife Hernandez, Bruce Llewellyn) ser~e on this Commission we may be able to amend its report and, thereby, move the Chamber. T152800451

(2) We also intend to increase our recruitment efforts in upstate New York, particularly in view of our intended increase in activity in this area as outlined later in this memo. Particular target areas include: I. Buffalo 2. Syracuse Albany 4. Nassau County 5. Rochester 6. Binghamton These have been selected in accordance with our legislative targeting and as a result of the outcome of the first round of legislative visits. We intend to close the formal Citizens Committee recruitment effort on April 15. After that date our efforts will be concentrated on utilizing those members who will agree to be active and in keeping the inactive members informed. This does not mean that we will not adcept new members, only that we will no longer expend specific resources in member recruitment. Soon after the close of recruitment we expect to issue our first newsletter to Citizens Committee members which will bring them up to date with the project and outline our plans for the coming weeks. We hope to issue this newsletter every two or ~iree weeks. In addition, members will receive, f~om time to time, various article reprints, brochures issued for other purposes by the campaign, additional factual material, and other items by mail. Those Citizens Committee members who agree to be active in our campaign will be put to work in one of three ways (or in more than one, if they will permit): i. appearing on press programs, talk shows,.intervi~s, and participating in other kinds of mass media events 2. helping us to recruit invitees for and appearing at our citizens forums (described later in this memo) 3. personally visiting members of the legislature or other important officials in order to inform them of their interest in this program and to promote its passage. In summary, the Citizens Committee operation appears to be proceeding well and we expect it to develop into a successful effort along the lines envisioned in the original proposal. INDUSTRY COMMITTEE We now have Ii members of the committee (see Appendix 3,attached) covering all major industry groups. We are not continuing recruitment -(since the purpose of this committee is somewhat different than that of the Citizens Committee) but we are open for additional suggestions. This committee (originally the Steering Committee in our proposal) will oversee and encourage T152800452

industry participation in the project. We have obtained access to some 24,000 additional industry names from various sources. Some industry figures have been willing to actually provide us the names and addresses so that we could mail them directly. This number totals about 3,000. The remaining 21,000 must be contacted indirectly, through billing invoice mailings or other mail contact via the list source. This method is cumbersome, inaccurate, and lacks the necessary control for proper follow-up, but it seems to be the best we can do. Most industry groups simply will not allow us direct use of their names. (See Appendix 4, attached.) We have begun the first of a series of mailings to" these lists. A letter from the list source (see Appendix 5, attached) pointing out the nature of the problem and asking for their support, and including a mail-back recruitment card, is being sent this week (April 4). We are mail'ing the names we have directly, and are providing material, for mailing to those being sent indirectly. The mail-back recruitment card will be sent directly to us. We will make a second pass at the same list (since ~e are force~ to approach it indirectly) with a letter to all from Industry Committee Chairman Malcolm Fleisher on CCABC stationery, and including another mail-back card. This letter should be mailed during the following week (April Ii). During the week of April 18 we hope to send the first Industry Newsletter (similar to the Citizens Committee newsletter) informing everyone.on our list of the status of our effort and outlining two programs in which they will (by other means) be asked to participate: our point-of-sale effort and our citizens' forums. Finally, for April, we intend to invite as many as possible to our citizens' forums which will~ on April 26 (thus the invitations will have to be in the mail during the weeks of April 18 and April 25~ In order to make sure that all of this is properly "cleared" we intend to have a meeting of the Industry Committee during the coming week (April 4). This will enable us to explain the program in detail, obtain suggestions for implementation, and get general agreement on the entire system. If we can obtain industry-wid~ agreement then we hope to have eac~ committee member communicate to his own association or employees what to expect in April. For the point-of-sale program we'd like an introductory memo and, then, kit delivery. For the citizens' forum program we'd like an introductory memo, then mail or hand delivered invitations, then actual supervision of forum attendance. T!52800453

(4) It should he noted that the most difficult part of the project to date has been in gaining industry cooperation. Opposition has ranged from outright political blockage in Albany to incessant nit-picking, While we are sensitive to the fact that many individual egos are involved and that there is a pecking order in the tobacco industry as in other groups, we have rarely encountered suhh a high level,°o=['.suehfp~olo~g~d,f inter-industry bickering. While this is tough on everyone's nerves, the more important point is that it delays every single step we take. The clearance process for some operations is byzantine and the level of ego-involvement surpgssgs not only our expectations but what might reasonably be expected from the most demanding. prima donna. It does not damage our project irreparably, it merely makes the going longer, tougher and more expensive. Specifically, by industry group, therefore, we are hopeful of obtaining cooperatio~ on the following items: manufacturers: establishment of the point-of-sale distribution system participation in the citizens' forums whol'esalers (upstate) : letter to the legislature re-affirmlng support assistance in the point-of-sale effort ~articipation in'the citizens' forums wholesalers (NYC): vendors (upstate) : vendors (NYC) : permission to contact members directly on this plan assistance in the point-of-sale effort participation in the citize6s' forums permission to address their board meeting in an attempt to re-gain endorsement and support asslstanee in point-of-sale effort participation in the citizens' forums letter to membership on free enterprise marketing assistance on point-of-sale effort participation in the citizens' forums Our connection, to date, with the food merchants. , has been much more cooperative." They have agreed to execute the following program for April and have already been actively lobbying on our behalf: I. we have taken a full page ad in the Food Merchants Advocate, Modern Grocer, Modern Grocer E~panol, and the U. S. Tobacco Journal announcing our point-of-sale program. (We expect to place ads in other trade papers as well.) 2. The Chairman of the Board of the New York State Food Merchants Association will write a letter to some 2,800 food chain and food store executives outlining our program. (NOTE: this has been cleared with the Association Executive Director, but we still must present the program to the C|~irman for his okay.) TI52800454

(5) 3. It is hoped that we can establish a series of visits from manufacturers' Vice-Presidents. for Trade Relations to various important food merchants to point out the importance of the program and to explain the point-of-sale effort. 4. We would like to send a letter from Citizens Committee member, and food store exectuive J. Bruce Llewellyn, to all food store execs also endorsing the program and urging their support. 5. We also hope for a letter from an influential upstate food store exec to the membership, pointing out that ALL ~tate areas need to be concerned about this problem, not just NYC. 6. Followihg this series of initial contacts, it is intended that the manufactureres "detail men" visit each of the food stores in their territory with the point-of-sale display, ask the merchant's cooperation, and locate the display in a prominent place. 7. The display will point out the dangers of cigarette bootlegging and ask for citizens to sign up to fight organized crime by filling out an attached card and placing it in an attached bag or box. 8. We would like the cards to be picked up by the regular routemen during their weekly visit and returned to us. 9. We, then, hope to follow up with a mail-back card or sheet used as a blow-in in the May edition of the Food Merchants Advocate. The question of the ~panish Grocers' Association, which cl~ims some 3,000 members and potential service to 3,000 additional hodegas, is still unresolved. We have examined the Modern Grocer spanish grocer mailing list and it seems most complete. If we can gain access to this list, we would probably hav~ enough contact for this group via mail. The Spanish Grocers Association, however, has indicated that it would like financial support from the industry before allowing use of its list, which we have not seen. In any event, it seems likely that we have immediate access to the 12,000 to 15,000 major outlets represented in the Food Merchants Association, which ought to be plenty for our point-of-sale effort. We have established initial contact with the appropriate union officials and they have indicated support. In summary, a~though the industry effort ~s moving very slowly and we are encountering a steady series of objections, problems, changes of mind, and personality difficulties, we expect to be able to complete the April program on schedule. TI52800455

(6) FIELD PROGRAM We have held 19 meetings i~ the field with various industry members. A total of 179 people have attended these meetings and 177 have joined the Citizens Network. Some 7 of these groups have already arranged meetings with their Assemblyman or Senator (see Appendix 6, attached). The others are attempting to establish these meetings. While it is apparent that this portion of the program is likely to be quite successful, it is equally apparent that it moves extremely° slowly. Therefore, we intend to amend the field program slightly in order to recruit from a broader group more quickly. As soon as we expand our base, we can return to the individual meetings with legislators. The system for broadening our base rapidly is called Citizens Forums. expect to hold at least 4 Forums in: Syracuse April 26 Buffalo April 27 Nassau Co. April 28 Albany May 3 These Forums will provide an opportunity to invite thousands of industry personnel, citizens groups, civic clubs, and other potentially interested organizations. At each Forum we will have an opportunity to explain, our program and to recruit Citizens Network volunteers (similar to the program at the all-industry dinner at Loew's Summit in February). Each Citizens Network volunteer will be asked to fill out a three-part card a__t the event. One part is for our record, one will be mailed to their Assemblyman (by us) and one will be mailed to their "Senator (again, by us). The cards indicate their support for our program and their willingness to help us collect petitions to be sent to Albany. Although we expect to invite thousands; probably no more than 50 or 60 will actually attend. Our recruitment rate among people who have attended all our events so far~ however, has been excellent and~ if this continues, we should have a superb core of people whom we can use to build in each area. Please note, too, that this Citizens Forum program is designed to attract press attention. In addition to the event itself, we expect to schedule a press tour by the Chairman of the Citizens Commitee, and other prominent citizens, at the same time as the events, in the same market areas. If the budget will allow, we'd also like to do a small amount of radio and newspaper promotion of each event in each market just before the Forum is held. Whi~e the organization of the Citizens Forums is progressing we don't want to forget about those already recruited into the network. They'll receive a newsletter Bringing them up to date on the program, an invitation to attend the nearest Forum, and other pertinent material, as resources permit. T!52800456

(7) It is our hope, therefore, to have over 500 people in the Citiz6ns Network by the end of April. These will form a May base for expanding the Network and for direct contact with legislators. As a supplemental group, we will be in touch with the 20,000 or more contacted by the Industry Committee (there will be some overlap), the 500 or more contacted by the Citizens Committee (there will be some overlap here, as well), and, in addition, we have available on computer some 8,000 names from the Tobacco Institute who signed the Smokers' Rights Petition earlier this year in New York State. In summary, the Field Program is moving more slowly than we had hoped at the moment, but the change of direction in April should speed things up, as well as give us a media boost, and we expect to be on track at the end of the month. ALBANY PROGRA>I The Albany effort, since it deals with the smallest constituent group, and they are all located in one place, has probably gone best of all, so far. We have contacted 56 .Assemblymen and 38 Senators to date. Their responses are recorded, in detail, in our Master Record Form. The statistical summary of their responses is attached (see Appendix 7). Visits to the final group will be completed during the week of April 18, when the legislature returns to Albany from spring recess. in the meantime, since most keep in touch with their Alb~ny offices for ma~l and phone calls during the interim, we are continuing their mail contact, roughly as followS: Curran letter and reprint of Donati Report Basic brochure Crime brochure Albany Forum invitation Briefing invitation week of April 4 week of April ii week 6f April 18 week of April i8 week of May 2 In addition to this basic line of material we are planning other selected mailings of reprints, statistical analyses, and informational material as it becomes available. Individual responses to those legislators Misited by our Alba~y advocates are prepared following visits each week and, as time goes on and our Field operation begins to grow, we will ask for targeted mailings from our Citizens Network to selected legislators (or phone calls or visits) on the advice of our Albany group. T!52800457

(8) RESEARCII Basic research is, and has been, a very difficult area for us. We are now working on an update of the briefing book, the compilation of a basic fact sheet, and special background pieces (for management and staff use, not for public distribution) on both crime and economics, but the volume of material is great and the going is slow. It is important t~ keep in mind that this research is not intended to go over ground a~ready ploughed, but to build the best possible case for our bill. We have received a number of opposing arguments from various legislators in the course of our Albany contacts and we are trying to tune the research to answer these arguments. Principal concerns seem to be: - why should we "bail out" New York City again? - bootlegging isn't a problem upstate - why should we add more forms and paperwork for small businessmen (with licensing)? - Jill the City reall~ be held harmless? - will the savings be'passed on to the consumer, or, if not, who in the industry will get the extra profit? - is wiretapping necessary? (upstate) (upstate) (upstate) CredO) (t~c.) (NYC.) We know the answers, of course, to each of these questions, but putting them in convincing form is something which takes time. We are continuing to work on it. PRESS/PR This is another weak area. Considering our relative lack of emphasis on a full press and PR effort thus far, we have received excellent coverage. We have come to the conclusion that our beginning with an in-house press person was a fine idea from the standpoint of press conference and releases, but that the concept lacked the component of long-range planning and.idea work. We are in the process of locating a press/PR firm which can complete not only the basic press work, but which can also help with the broader conceptual effort. Insofar as the specific event (selling cigarettes in a public place at "bootleg" prices and distributing, with each pack, a flyer that notes that the buyer, although he may think that he has saved money, would (had the cigarettes actually been bootlegged) have contributed to organized crime) is concerned, we are working out the legalities. We have applied for a New York State Cigarette License, we have completed the required paperwork for payment of the New York State Sales Tax, and we are in the process of applying for a New York City Peddler's License. T152800458

If we can receive approval from all the various agencies involved within the next week or two, we should be able to hold the event in mid- April, close to the kick-off of our point-of-sale program and our Citizens Forums. With the aid of our press/PR firm, we then hope to keep up a regular weekly barrage of events, releases, and radio feeds around the state, in order to keep the question in public view. MATERIALS We have completed production of our Basic Brochure (the eight-page, buff colored piece). In production, at the moment, are: - a three-panel (#I0 envelope size) recruitment brochure for use in industry and citizens committee mailings - Citizens Forum invitations - Three-piece Citizens Forum Recruitment Card - Forum Posters - a re-print of the Special State Task Force Report - a small number of re-prints of the Advance Copy of the ACIR Report - Short summaries of the Task Force and the ACIR ieports - a brochure which specifically details the crime problems - a brochure which specifically details the economic problems - a basic Fact Sheet - Point-of-smle p~sters," petitions, bag-stuffers, matchbooks Additional pieces are planned for production during April, pending program development. CO~UTER We have begun to enter our }~ster Record File into the computer, using Tru-Check Computer Services, Inc. in Hartsdale, N. Y. The system is compatible with that in use by the Tobacco Institute. We expect to build a file of some 20,000 names from all sources (not including petition signers). T152800459

(io) All in all, I think the outlook is relatively good. Normally, there is about a month's "run-in" time in any campaign in order to get fully staffed, work out the kinks, get personalities and programs adjusted, and get going. In this effort it has taken us two months. I think that the longer period has been required basically because of industry related problems and the general newness of the system for all of us. I can clearly sense that the programmatic effort is coming together in all areas and, in my judgem~ent, the campaign is (at last) about ready to "blossom" in April. Barring further problems (partic~larlywithin the industry) we ought to be reaching or exceeding our goals by the end of the coming month. T!52800460