Premium Cigar Association Furloughs Staff, Ends Lobbying Contracts Amid Financial Shortfall

The Premium Cigar Association (PCA) has informed its staff that they will be furloughed as the organization navigates through its new financial situation.

“The PCA board has struggled with several very difficult decisions over that time and the staff have done a tremendous job working very hard to keep the organization operating close to full capacity,” said John Anderson, president of the PCA board. “Therefore, it is with a heavy heart that we reach out today to let you know that we have decided to furlough the PCA staff temporarily while we work on some key items. I want to stress that this is only temporary, and we fully intend on bringing the full staff back as soon as we are able. This is just to give us some time to get financially settled in order for us to move forward.”

Scott Pearce, the organization’s executive director, said that the furlough would begin July 15 and would cover the entire staff, including Pearce. The organization is stressing that the furlough is temporary though it didn’t provide a timeline as to when it might end. The PCA will rely on its voluntary boards to deal with the critical functions of the organization during the furlough.

In a conference call with media, Pearce indicated that the financial constraints would impact the legal fight against the U.S. Food & Drug Administration (FDA). The PCA, along with two other trade groups—Cigar Association of America (CAA) and Cigar Rights of America (CRA)—filed suit against the agency over its regulations of cigars and pipes.

Over the last month, the PCA has been trying to figure out how to run its operation in the face of an expected massive revenue shortfall. In May, the 2020 PCA Convention & Trade Show was canceled due to the coronavirus COVID-19 pandemic. That was certain to have major financial impacts for the organization given the trade show has provided at least 70 percent—and likely a much greater percentage—of the organization’s revenue in prior years. On Friday, it informed exhibitors that the PCA was going to count deposits for the canceled 2020 trade show for next year’s 2021 trade show. It’s unclear whether the PCA is offering refunds for exhibitors who want them.

Even if the trade show had happened, this year’s show was likely to generate less revenue than in previous years. In January, four of the largest trade show exhibitors—Altadis U.S.A., Davidoff of Geneva USA, Drew Estate and General Cigar Co.— announced they would not be attending the 2020 trade show.

Those four companies alone accounted for over 18 percent of the trade show floor and contributed hundreds of thousands—if not over a million dollars—to the organization.

The news of the furloughs comes after the PCA informed its contracted lobbyists last month that it would be ending their contracts effective July 1. Pearce said the organization would deploy lobbying resources in critical areas going forward.

Previously, Pearce did not respond to emails regarding the cancellation of the 2020 PCA Convention & Trade Show as well as the cancellation of contracted lobbyists.