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Cigarette mail ban in Obama's hands

Published:March 18, 2010, 12:30 AM

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Updated: August 21, 2010, 9:49 AM

WASHINGTON — Congress on Wednesday sent President Obama a bill that bans the mailing of cigarettes, a measure that would bring the full weight of the federal government down on the Seneca Nation's huge tax-free tobacco trade that New York State has been fighting for years.

The House, in a 387-25 vote, sent Obama a measure the Senate had approved six days earlier.

The president is expected to sign it shortly, and it would take effect 90 days later.

"This new law will give states and localities a major revenue boost by cracking down on the

illegal sale of tobacco," said Rep. Anthony Weiner, D-Queens, the bill's chief sponsor. "Every

day we delay is another day that New York loses significant amounts of tax revenue and kids

have easy access to tobacco products sold over the Internet."

Chart: Breakdown of law taking aim at Seneca cigarettes

The Senecas said they would do whatever they could to prevent the law from devastating the

nation's tobacco entrepreneurs and the 1,000 or more people who work for them.

"This attempt by Congress to return us to the days of want, squalor and dependency will not

succeed," said J.C. Seneca, a successful tobacco entrepreneur and co-chairman of the tribe's

Foreign Relations Committee. "We'll find ways to weather this economic storm and keep fighting

for our future."

While warning of the economic dangers the bill poses to the tribe, Seneca also questioned

whether it was workable — and so did the U.S. Postal Service.

"Enforcement will be difficult," said Gerry McKiernan, a spokesman for the Postal Service.

Because of privacy laws, "Priority Mail is sealed from inspection. All first-class mail is

sealed from inspection. I don't really know how it's going to work," McKiernan said.

Law enforcement agencies, of course, could get involved, McKiernan noted. But Jan Kemp, a

spokesman for the federal Bureau of Alcohol, Tobacco, Firearms and Explosives, said that

agency does not comment on pending legislation.

If the mailing of cigarettes is halted, the financially struggling Postal Service could

lose $30 million to $40 million a year in revenue, McKiernan added.

But that's nothing compared with the potential loss to the Senecas.

"This is a direct assault on our economy and our people," said Barry E. Snyder Sr., the

tribe's president. "And it will have a devastating ripple effect on the Western New York

economy."

That being the case, the tribe will continue its fight by pressing Obama to veto the bill

— a move that supporters of the bill said is highly unlikely.

"We are putting concerted pressure on the White House, trying to get meetings with them,"

Seneca said. "They have been unresponsive so far."

If Obama signs the bill into law as expected, the Senecas also could approach private

shippers to see if they will resume shipping cigarettes. Federal Express, UPS and DHL, under

pressure from New York State, all stopped shipping cigarettes years ago.

The Senecas have even discussed setting up their own shipping system, Seneca said.

"Whether that would be a viable option, we don't know," Seneca said.

One thing is for sure, however: The bill poses one of the greatest challenges yet to a

business that has made several Senecas rich while costing New York State upwards of $500

million a year in lost tax revenue.

"We're finally going to be able to get control of this problem," Weiner said.

Then again, the Senecas have reacted strongly to state attempts to collect taxes on

cigarettes sold on the tribe's reservations.

Most notably, in 1997, the Senecas burned enough tires to close part of the New York State

Thruway to protest the state's tax-collection attempts. Senecas and their supporters ended up

in a brawl on a section of the Thruway that ended with 12 state troopers injured and dozens of

Senecas arrested.

Asked how Senecas could react to enactment of the new federal mailing ban, Seneca said:

"Anything is possible. We want to avoid any situation that would put anyone in harm's way.

It's unpredictable at this point."

The bill — the Prevent All Cigarette Trafficking (PACT) Act — also would

require any online seller of cigarettes to collect all state taxes on the products and verify,

both at the time of purchase and the time of delivery, the customer's age and ID.

Huge tobacco companies such as Altria and Lorillard, which have been losing business to the

Seneca merchants, backed the bill, as did every major anti-smoking organization.

"The PACT Act offers Congress a unique opportunity to fight crime, protect federal and

state tax revenues and promote public health, all at the same time," said Matthew L. Myers,

president of the Campaign for Tobacco-Free Kids.

Seneca, Snyder and other tribal leaders spent Wednesday in Washington, hoping to engineer a

last-minute miracle to stop a bill that passed the usually fractious Senate unanimously.

They found no support from Western New York's lawmakers and only 25 votes overall,

primarily from the most conservative members of Congress.

Cancer advocates in New York State estimate that 100,000 New Yorkers will stop smoking if

taxes can be collected on cigarettes, and countless more will never start, said Rep. Brian

Higgins, D-Buffalo.

"The arguments are pretty compelling," Higgins said. "If you eliminate smoking, you

eliminate a lot of cancer."

Rep. Chris Lee, R-Clarence, noted the bill had "overwhelming support," and for good reason.

"The Senecas just left my office; we had a very cordial conversation," Lee said. "I'm

sympathetic — but I'm also getting calls from parents in my district who are worried

about the problem of selling cigarettes to teenagers online. That takes precedence."

Rep. Louise M. Slaughter, D-Fairport, was meeting with businesspeople from her district and

thus missed the vote, her office said.

Snyder said he didn't understand how local lawmakers could favor the bill. "It is difficult

to comprehend how our elected officials can vote for something that will kill more than 1,000

jobs," he said. "It's extremely disappointing."

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