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Rubio Holds Small Business Field Hearing on Keeping Small Premium Cigar Businesses Rolling

Apr 5, 2019 | Press Releases

Tampa, FL — U.S. Senator Marco Rubio (R-FL), Chairman of the Senate Committee on Small Business and Entrepreneurship, has convened a hearing titled, “Keeping Small, Premium Cigar Businesses Rolling”.
 
The hearing will look at the climate of overregulation of the premium cigar industry, an iconic staple to Florida’s economy. Earlier this year, Rubio re-introduced the Traditional Cigar Manufacturing and Small Business Jobs Preservation Act of 2019, which seeks to exempt premium cigars from excessive and overly burdensome U.S. Food and Drug Administration (FDA) regulations and fees. Last year, Rubio spoke on the Senate floor on behalf of his amendment to save the premium cigar industry after leading a bipartisan letter to the FDA that urged an exemption of premium, hand-rolled cigars from these overreaching regulations, which threaten American premium cigar manufacturers and retailers, and could force this industry of mostly small businesses across the country to close. In 2016, Rubio visited Tampa’s J.C. Newman Cigar Company to meet with workers whose paychecks are being threatened by destructive regulations from Washington. In 2014, Senator Rubio penned an op-ed that called for “a halt to unnecessary federal regulations that threaten” this industry.
 
The hearing is being live-streamed on Senator Marco Rubio’s Facebook page.
 
Rubio’s opening remarks as prepared are below:
 
Rubio: “I call this hearing to order, and thank our witnesses for being here to discuss an important and historical industry to Florida.  
 
“As Chairman of the Senate Committee on Small Business and Entrepreneurship, I am pleased to bring more awareness to this iconic industry, and the regulatory assault that threatens it.
 
“And I can think of no better location to do so than here in Tampa— in an area known as Cigar City.
 
“Florida’s premium cigar industry is one that is rooted in small, family-run businesses.  
 
“These are businesses that have been handed down generation by generation, and many are representatives of the cultural history of the Cuban community that have made Florida their home.
 
“One such example is J.C. Newman Cigar Company, as represented by one of our witnesses, Drew Newman, the founder’s greatgrandson.  The company is a fourth generation business that has spanned an impressive 124 years.
 
“Unfortunately, manufacturers like J.C. Newman, retailers like Corona Cigar, and the rest of the premium cigar industry are under threat of regulation that would force them out of business.  
 
“A 2009 law, and subsequent Obama Administration final rule, allows the Food and Drug Administration to regulate the manufacture, import, packaging, labeling, advertisement,  promotion, sale and distribution of premium cigars—a move that was intended to protect children from cigarettes and other tobacco products. 
 
“I support current laws which prohibit minors from smoking—but tobacco is a legal product and small manufacturers and retailers of premium cigars are wrongfully being targeted.  It is simply not right for the government to unfairly place detrimental fees and regulations on an entire industry simply because some in the government do not like the product being manufactured.  
 
“It must also be noted that the rule, issued in 2016, encompassed tobacco products on the market since 2007—a full two years before the authorizing legislation became law.
 
“The regulatory cost of compliance would give preference to foreign-made products and destroy this American industry.  For instance, J.C. Newman sells about $10 million worth of products annually. But, it would cost approximately three times that amount just to comply with proposed FDA regulations. FDA has calculated that 90 percent of the businesses affected by this rule are considered to be “small.”
 
“This overregulation is unnecessary as it is already illegal to sell tobacco products to anyone under the age 18, and the FDA’s own research proves that underage tobacco users are not smoking premium cigars.
 
“The FDA, in conjunction with the NIH, conducted a comprehensive study of tobacco use. The FDA’s own research concluded that premium cigar smokers account for 0.7 percent of all adult tobacco users and the median age of first regular use is 24.5 years old. The FDA-NIH research was also unable to provide any data on youth that consume traditional cigars frequently or daily. This is because premium cigars are not made for children, marketed to children, or consumed by children.  This begs the question of why premium cigars are wrongly being regulated under a law aimed to reduce youth consumption of tobacco. 
 
“So what can we do to stop this overreach?
 
“In Congress, we can pass my bill, S.9, the Traditional Cigar Manufacturing and Small Business Jobs Preservation Act of 2019, which would exempt the industry from FDA regulations. This legislation, which I introduced on the first day of the 116th Congress, would only apply to the premium cigar industry, and has the bipartisan support of 11 senators.  I am pleased that my colleagues, Representatives Castor and Posey, led the House effort with 35 bipartisan cosponsors. 
 
“For each of the three fiscal years since the 2016 rule was finalized, the House of Representatives passed legislation exempting premium cigars from harmful FDA regulations through annual appropriations bills. Unfortunately, these provisions were dropped in conferences – every time at the demand of democratic opposition.
 
“At the FDA, we must ensure the next commissioner is welleducated on the unique nature of the premium cigar industry.  This is why this hearing is so important—we are furthering the record that this industry is unlike other regulated tobacco industries.   
 
“I am committed to helping this iconic industry, and will advocate on its behalf with members of the administration and my colleagues in Congress.   
 
“Giving premium cigar makers and retailers the clarity and assurances needed to continue with their craft is a top priority of mine.   
 
“At a time in which both parties express concern for small businesses, manufacturers, and the American working class, this should not be controversial.  
 
“Today’s hearing will shed light on how proposed regulations from the FDA will impact this iconic industry- one that is so rooted in Florida’s history.   
 
“And on a personal note, I have often told the story of my grandfather, who grew up in Cuba, and suffered disabilities from Polio.   
 
“These physical disabilities led him to work in a cigar factory, where he entertained the cigar rollers by reading to them.  
 
“I hope to make a difference for this industry, and so many other small businesses across the country, who are currently under siege by job-killing regulations.”