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Senate Panel Approves Tobacco Bill

April 2, 1998

WASHINGTON (AP) _ A bill that would force the tobacco industry to pay $506 billion over 25 years, plus billions of dollars in fines if teen-age smoking rates do not decrease significantly was approved Wednesday by a Senate committee.

The bill won the endorsement from an overwhelming majority on the Senate Commerce Committee, clearing the first legislative hurdle on the road to what members of both parties and the White House are targeting as a new national policy on tobacco.

Only Sen. John Ashcroft, R-Mo., voted against it. Ashcroft said he objected to giving cigarette makers legal protections not accorded other companies. In return for curbing its own advertising, the tobacco industry would get protection from lawsuits in the form of a $6.5 billion annual limit on punitive damages.

White House spokesman Barry Toiv welcomed the committee’s action but said the administration would pursue higher cigarette prices and tougher penalties for the tobacco industry.

``We believe that some significant changes are goin to be needed, but it’s a good start and represents progress,″ said Toiv.

Drafted primarily by the panel’s chairman, Sen. John McCain, R-Ariz., the bill leaves the most contentious issues to be debated on the Senate floor or in negotiations with the White House.

Among them are how to spend the hundreds of billions of dollars to be paid by tobacco companies and details of payments to lawyers who negotiated last June’s settlement between 40 states and cigarette makers. Nonetheless, McCain said, Senate leaders in both parties hope to hold a full Senate vote by June 1.

``There is no dbout that this is only the first round, and there are many roungs to fight,″ said McCain. ``We have to keep some perspective.″

Tobacco companies have threatened to walk away, taking with the the advertising curbs that constitutional experts say cannot be forced by Congress.

``Whether some up here like it or not, the tobacco companies are part of this process,″ said the committee’s ranking Democrat, Sen Ernest Hollings of South Carolina, where 50,000 tobacco farmers and workers produce a $1 billion industry. ``Our goal should not be to lay waste to their balance sheets, for doing that would not allow us to move forward to improve the public health.″

One amendment accepted by the panel minutes before the vote would give financial aid to tobacco farmers and landowners injured if the legislation prompts a lower demand for the crop.

Many lawmakers, particularly Democrats, say Congress doesn’t need the industry’s consent to discourage teen-age smoking in other ways. Republican leaders also have balked this election year at granting legal protection to an industry they believe lied for years about encouraging teens to smoke.,

Separately, the Senate voted 54-46, mostly along party lines, to kill an effort by Democrats to amend a Republican-written federal budget for 1999 by requiring that any tobacco funds be used for health and anti-smoking efforts.

The budget, a nonbinding blueprint, would require that all money from tobacco legislation be used to buttress Medicare, the health insurance program for the elderly.

That is expected to change should legislation by McCain or other lawmakers ever near final passage. For now, Senate Republicans prefer language steering tobacco money to the popular Medicare program because it helps them fend off efforts to use the money for spending or tax cuts.

In the first hours of the drafting session, McCain’s committee signaled a clearer picture of where money raised from tobacco companies should be spent. That debate, McCain said, likely will be fiercely fought later by the White House and congressional leaders.

The panel passed an amendment by Sen. Olympia Snowe, R-Maine, that provided guidelines. The nonbinding resolution endorses funding: to reimburse public health care programs and states for the costs of treating sick smokers, for anti-smoking advertising, tobacco-related health research and assistance for tobacco farmers.

Also approved was an amendment from Sen. Bill Frist, R-Tenn., designed to provide more incentive for companies to comply with targets for teen-age smoking reduction, called ``lookback provisions.″ It would put a small percentage of the money tobacco companies pay in penalties into a pool to be awarded to companies that have achieved 95 percent compliance with the targets for reducing teen-age smoking.

The panel rejected, by voice vote, an amendment by Sen. John Ashcroft, R-Mo., which would have applied the legal protections for the tobacco industry to other, more ``wholesome″ industries that ``are in the business of saving lives.″

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