Discusses communication between state legislative aide and owner of cigarette warehouse. States that legislative aide requested that owner consider participating in a cigarette stamping operation by the state which would ultimately "eliminate the payment of any discount to stamping wholesalers." Recounts owner's opposition to participation in the program and concludes, "Mr. Duke [owner] advised me, in confidence, that he was thoroughly opposed to any attempts by the state to make inroads in this area and would actively lobby against such proposals with fellow warehousemen in Florida."
Page 1: mzj68e00
PHILIIP MORRIS U.S.A. ~ECEtYEp '
INTER - OFFICE CORRESPONDENCE
100 Park Avrenue, New York, N.Y. 10017 UT
To: Mr. J. P. Jeb Lee
From: M. W. Murphy
Subject: FLORIDA TAX STAMPING
Date:: October 2(?; 41978
I have been advised that last week a representative from a
Florida legislative committee visited an official of a public
warehouse in Jacksonville to discuss the possibility of state
personnel tax stamping cigarettes at this location.
According to Mr. Tom Duke, President of the Laney & Duke Ware-
house in Jacksonville, the legislative aide who visited him
was seeking approval to allow the state to place four or five
meters within his warehouse and stamp all cigarettes which
would be shipped from this location. As explained by the aide,
the state's motive in undertaking this activity would be to
ultimately eliminate the payment of any discount to stamping
wholesalers. The legislative aide reiterated to Mr. Duke
the state's contention that they could perform this function
cheaper than it is now being done. (In 1977, Florida paid
out nearly $4,000,000 to wholesalers in stamping discounts.)
The aide informed Mr. Duke that his warehouse had been select-
ed as a test-site for this activity since it was the closest
facility to state offices in Tallahassee and would thus allow
for easier monitoring and control. If the results of this
pilot program at Laney & Duke warehouse were deemed success-
ful by the state, the aide said that this activity would
thereafter be expanded to all public warehouses within Florida.
Mr. Duke advised the aide that he would be opposed to the
state initiating!a stamping operation within his warehouse
for a number of reasons:
* he would be reluctant to lease warehouse space
to the state to conduct stamping.
* he would not want to be liable for any claims
which might arise due to loss or damage to
cigarettes during stamping. If the state were
to stamp cigarettes, they would first have to
* due to potential labor problems, he would only
allow union help to work in his warehouse.
State personnel are not unionized.
Page 2: mzj68e00
Mr. Duke attempted to dissuade the legislative aide from pursuing
this matter further by explaining some of the logistical problems
inherent in such a proposal. Mr. Duke advised the aide that a
significant portion of his shipments are to out-of-state whole-
salers. Further, his warehouse does not house all brands from
all of the manufacturers.
Mr. Duke subsequently received a phone call from this same leg-
islative aide inquiring if Mr. Duke would like to assume respon-
sibility for stamping. Mr. Duke's reply was that he was more
opposed to this proposal than he was to the State's initial idea.
Mr. Duke advised me, in confidence, that he was thoroughly opposed
to any attempts by the state to make inroads in this area and
would actively lobby against such proposals with fellow warehouse-
men in Florida.
cc: A. Bissmeyer
R. E. Pruehsner
~ ~- -~~--~~~