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Machinist turns activist over tax

Tribune photo by FRED BELLET

Ron Russell wrote a letter chastising cigar tax supporters for "short-sightedness" in taxing Hav-A-Tampa cigar factory out of business.

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By MICHAEL SASSO

msasso@tampatrib.com

Published: July 4, 2009

ZEPHYRHILLS - Ron Russell, a high-energy, outgoing machinist at Hav-A-Tampa cigar factory, isn't an activist, but every so often the outrage wells up.

It happened nearly three decades ago, when he wrote to the Detroit Free Press about the failings of the city's public school system. He was incensed after seeing his health teacher beaten by youths in front of the entire class.

The newspaper was impressed enough to feature him in a profile story. Now 43, Russell is speaking out again on what he considers another outrage: the upcoming closure of the Hav-A-Tampa factory near Seffner, where he's worked for about four years.

Russell crafted a letter he plans to send to congressional supporters of an increased federal cigar tax, chastising them for "short-sightedness" in taxing a 102-year-old local factory out of existence. He got more than 90 co-workers to sign it.

Local radio talk-show hosts have seized on the issue and read Russell's letter on the air, singling out U.S. Rep. Kathy Castor for criticism. The Tampa Democrat helped champion the children's health insurance program the tax increase is funding. Her spokeswoman, though, suggested Hav-A-Tampa's closure may have less to do with the tax increase and more with a plan to cut jobs and costs by Hav-A-Tampa's British owners.

To Russell and other Hav-A-Tampa workers, there's no debate about why the factory is closing.

"I would like to see the people who made this happen stand up and say, 'We are going to look out for you,'" Russell said. "People ask me, 'Why do you do this?' If I don't, who will?"

Hav-A-Tampa turns out millions of machine-made Hav-A-Tampa Jewels and Phillies Blunt cigars from its factory east of Tampa. Among about 500 workers, the factory has legions of 20- and 30-year employees.

Workers have been on edge.

The factory's parent company, Altadis USA, started furloughing workers and temporarily shutting the factory in recent months as sales of its cigars began to wane.

The company warned employees about a proposed tax increase to fund the State Children's Health Insurance Program, a federal effort that provides health insurance for low-income children.

At one point, promoters of the insurance program talked of levying a tax of as much as $10. The tax was whittled down to $1 per cigar and eventually to a maximum of 40 cents per cigar. Cigars had been taxed at about 5 cents apiece before the increase took effect in April.

Even at that lower tax rate, sales of Hav-A-Tampa cigars fell sharply, said Rick McKenzie, a senior vice president at Altadis USA, although he couldn't quantify the decline. The company announced last week it would shut the Seffner factory in August and move the remaining work to Puerto Rico.

The U.S. Treasury tracks cigar production, but the most recent data is from March, so there's no way to know yet whether the tax increase is affecting sales.

In the factory, though, workers saw a clear cause and effect.

"I think they could've still been profitable here if it hadn't been for the tax," said Victor Velez, a fellow machinist at Hav-A-Tampa.

'Loss of hundreds of jobs'

Russell moved to the Tampa Bay area shortly after the Sept. 11 attacks. He makes replacement parts for machines at Hav-A-Tampa, earning about $32,000 a year.

After Altadis announced it was closing the Hav-A-Tampa factory, Russell drafted a letter addressed to "Our Elected Officials," taking to task supporters of the tax increase for "the loss of hundreds of jobs, especially at a time when the economy is in a recession."

He's not sure what the letter can accomplish, but hopes politicians will offer solutions to the hardship employees are likely to endure, he said. With a skilled trade, Russell is less worried about his own family than other Hav-A-Tampa workers.

For now, he'll draw unemployment and hope his wife, Dorota, can pick up part-time work.

"With that, plus my unemployment benefits, we're alive," he said.

His letter and cause have been picked up by talk-show hosts, including Jack Harris, co-host of "AM Tampa Bay" on WFLA, 970 AM, and Dave Zeplowitz, whose "Cigar Dave Show" also airs on WFLA. On his Web site, Zeplowitz encourages listeners to "register your disgust" with Castor's office.

"There's no question, Kathy Castor has sold her constituents down the river," Zeplowitz said.

Alabama plant already shuttered

Castor was not available for comment this week, but spokeswoman Ellen Gedalius noted Altadis USA closed a cigar factory in Selma, Ala., last fall - well before the higher taxes took effect.

"Only now, after the tax increase has passed, do they use that excuse when explaining the Hav-A-Tampa closure," Gedalius said in an e-mail.

Gedalius also noted an English company, Imperial Tobacco, bought Altadis in 2007. During the following year, Imperial Tobacco announced plans to cut 2,440 jobs as part of the acquisition.

"In fact, this was nothing more than an overall business decision made by a company that has a long history of deep and drastic job cuts, factory closures and mergers," Gedalius said.

McKenzie, the Altadis executive, said the 2,440 job cuts were made in Europe. The company shut its Alabama factory, which made Phillies Blunts, because smaller cigars are becoming more popular and demand for its cigars had fallen, not as part of any merger.

In Zephyrhills, Russell and his family live in a manufactured home near the end of a dirt road.

Their house is kept immaculately clean, and despite its simple appearance his wife is thankful for their modest possessions, especially given her upbringing in Communist Poland, Russell said.

They're buckling down to prepare for the loss of his job. They've rarely eaten out in recent years anyway and recently gave up their cable television service.

"I can't think of words to comfort her other than, 'Things will always be OK,'" he said.

Reporter Michael Sasso can be reached at (813) 259-7865.

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