State tobacco farmers were celebrating a legislative victory yesterday that they say will go a long way toward stabilizing the Southern Maryland agriculture economy.
"This was a huge victory for the farming community of this region," Gary V. Hodge, an adviser to the Southern Maryland Tobacco Board, said of a bill that sets aside 5 percent, or about $225 million, of the state's $4.2 billion share of the national tobacco settlement to assist leaf growers.
The financial aid to Maryland farmers was included in a bill passed over the weekend that increased the state tax on cigarettes by 30 cents a pack, to 66 cents.
"This will be a great benefit to Southern Maryland farmers," said Earl Hance, a Calvert County tobacco grower.
Hodge, who is former executive director of the Southern Maryland Tri- County Council, called the bill a "commitment by the state to retain agriculture in the region."
Farmers have been growing tobacco in Anne Arundel, St. Mary's, Calvert, Charles and Prince George's counties since Colonial days.
While the leaf is grown on just 5 percent of the region's farmland, it accounts for two-thirds of the farm value of all commodities grown in the region.
Hodge said the funding will go to the Tri-County Council and will be used to implement the council's strategic plan to retain agriculture in one of the fastest-growing regions of the state.
Elements of the plan include: farmland preservation, a program to help tobacco growers switch to other crops, a buyout of tobacco farmers, and a program to sponsor research for alternative uses of tobacco.
There is nothing in the legislation that rules out using state funds to compensate farmers for losses, Hodge said, but he does not expect subsidies to be approved.
Gov. Parris N. Glendening has said he is strongly opposed to any state subsidy to farmers for losses so they can continue growing tobacco.
Hodge said funding will vary between $9 million and $12 million annually over the life of the national settlement. He said the state will provide $2.5 million this year to help the council start its program.
That legislation does not affect a separate agreement between state tobacco growers and U.S. cigarette companies.
The tobacco companies have set up a trust fund to help farmers who suffer losses as a result of declining cigarette sales. Maryland's share from the funds is $31.5 million over a 12-year period, according to Hance.
On another front, Hance said that prices at the current tobacco auction have risen in recent days. He said domestic tobacco companies increased the price they have been paying for certain grades of leaf from 50 cents and 60 cents a pound to $1.30 a pound late last week. Other grades rose from $1.30 a pound to $1.80 a pound.