Vote could end century-old tobacco group based in KY. Farmers would get payouts.
A vote has been scheduled on whether to dissolve the Burley Tobacco Growers Cooperative Association and distribute an estimated $28 million in assets to members.
Nathan Billings, a Lexington attorney leading the effort to dissolve the century-old co-op, announced Wednesday that the vote will be April 8 at 10 at the co-op’s office on South Broadway in Lexington.
Parking at the office is too limited to accommodate all members, so Billings said he is encouraging members to instead vote by a ballot his office mailed to about 640 people this week.
That was the membership list the co-op provided to Billings’ office, which was current as of the end of last week.
Billings said he sent the farmers a notice of the vote, a ballot and a copy of the dissolution plan.
However, the co-op board approved a measure under which people who produced burley last year can still register as 2019 members up until the end of February. Growers can contact the co-op about membership.
The co-op once played a role in the price-support system put in place in the Depression to help prop up farm income, but the government ended that program in 2004.
The co-op has since bought some members’ tobacco to help provide a market, but has lost money on that program in recent years as foreign competition, a decline in smoking and other factors eroded the market for U.S. burley.
People in support of dissolving the co-op have argued it no longer provides sufficient benefit to members and should pay out all its assets to farmers.
The co-op board approved a plan Feb. 5 to distribute most of its assets to members, but keep $3.5 million for continued operations that would include a focus on advocating for members’ interests with policy makers and tobacco companies.
Officials estimated that plan would ultimately pay out $28 million.
Estimates on the number of people who would share in a disbursement of the co-op’s assets vary widely, from a low of 2,200 to as many as 4,000. Most members are in Kentucky but the co-op also serves Indiana, Ohio, Missouri and West Virginia.
Supporters of the vote to dissolve the co-op have said its distribution plan doesn’t go far enough, arguing there’s no reason to hold back $3.5 million that could go to farmers.
