Deadline nears to join settlement for payout from end of Ky.-based tobacco co-op
Farmers who may be eligible for a payout from the dissolution of the Burley Tobacco Growers Cooperative Association face a deadline this week to become part of the settlement.
The cutoff date to establish membership in the group and submit a required document is Jan. 29.
The proposed settlement in the case includes landowners, landlords, operators, tenants, sharecroppers or businesses involved in growing burley tobacco during at least one year from 2015 through 2020.
Farmers in Kentucky, Indiana, Ohio, Missouri and West Virginia who qualify will be eligible, but most of the co-op’s members live in Kentucky.
The estimate that each member will receive in the settlement ranges from $2,000 to less than $6,000, according to Katie Yunker, an attorney with McBrayer PLLC in Lexington, who has been appointed to represent class members.
The co-op had names of more than 3,000 producers to include in the settlement, but even those who received notice in the mail have been encouraged to check the settlement web site to make sure they are registered.
Others who think they might qualify to take part in the payouts can register at that site, located at https://www.btgcasettlement.com/. The site has information on the documentation needed to become part of the settlement.
People can also email to ClassCounsel@mcbrayerfirm.com or call 1-866-965-9005. Growers must submit a tax document called a W-9 to be eligible for a share of the settlement.
The proposed settlement resulted from efforts to dissolve the century-old co-op based in Lexington.
The co-op once played a role in the federal price-support system, which guaranteed minimum payments to farmers while limiting how much they grew to try to avoid over-production.
That system helped prop up income for thousands of small farmers for generations, but the federal government ended it in 2004.
Many farmers stopped growing burley after that, and many others have dropped out since because of stagnant prices, declining demand, foreign competition and other challenges.
In the most recent federal census of agriculture, in 2017, there were 2,618 farms in Kentucky producing tobacco, down from 46,850 two decades earlier.
Some members argued that in recent years, the co-op no longer provided any real benefit and was wasting money that should instead be disbursed to farmers.
Fayette Circuit Judge Julie Muth Goodman is overseeing the proposed settlement of those complaints.
Goodman has scheduled a hearing Feb. 24 to consider the settlement, including any objections, which also must be filed by Jan. 29.
Yunker said there will be an estimated $28.2 million available to pay out after the co-op liquidates investments, pays debts, and sells its tobacco and office building in Lexington.
Attorneys involved in the case have requested fees totaling 25 percent of the net amount, saying they worked thousands of hours on the case and produced a good outcome for burley growers.
