FRANKFORT - A watered-down version of a bill that would have regulated contracting between farmers and cigarette manufacturers won approval from a House-Senate conference committee yesterday. The compromise legislation now calls for a yearlong study of co

But, while the committee reached a tentative settlement on Senate Bill 49, another issue important to farmers remained unresolved yesterday. The committee discussing how to spend tobacco-settlement money to help agriculture broke up without reaching an agreement. The yearlong study, which will be conducted by the legislature's Tobacco Task Force, was a substitute for a plan that would have set up a farmer-led committee to establish minimum standards for contracts through which farmers agree to sell all of their burley to a single manufacturer. But tobacco companies, particularly Philip Morris, lobbied hard against the amendment, which they said could force them to look elsewhere for burley. Sen. Joey Pendleton, D-Hopkinsville and chairman of the task force, said he plans to begin hearings in May on the contracting issues, with hopes of completing a report by December. Pendleton said Gov. Paul Patton has assured him that, depending on the task force report, he would be willing to call the contracting issue before the full legislature when it meets for an organizational session in January. Because Kentucky burley farmers only began signing contracts this year and because little is known about how contracts will affect farmers, the study was the best option, Pendleton said. Some committee members said they would have preferred to have kept the bill's original provisions for a model contract. ``If the governor doesn't call a special session, it will be 2002 before we can deal with this'' said Rep. Pete Worthington, D-Washington. The other issue yesterday was House Bill 611, which would guide how money from the state's share of the national tobacco-lawsuit settlement is spent to help farmers and agriculture. Kentucky is due more than $3 billion over 25 years; half will go to agriculture. House and Senate negotiators on HB 611 met yesterday, but talked privately for only a few minutes before breaking up. The House wanted much of the money controlled by local boards in 118 tobacco-producing counties, but the Senate's version called for a state board to control spending. The two sides have verbally agreed that a state board will control all spending, but with some portion earmarked for county-board recommendations. Negotiators have not agreed on the amount to be earmarked. They will likely meet again this morning. Another sticking point is whether to set aside money specifically for a program to purchase development rights to preserve farmland. The House wants money designated for the program, known as PACE. The Senate does not, arguing the program should have to compete for money with other agriculture initiatives. ``There's an impasse on the PACE program,'' Sen. David Boswell, D-Owensboro, said after the meeting. Rep. Roger Thomas, D-Smiths Grove, said it is possible that PACE funding can be worked out in the state budget, perhaps making it less of an issue in HB 611. Fayette County has approved rules to buy development rights, but wants matching money from the tobacco settlement.

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