The American Public Health Association,
Recognizing that as part of the Master Settlement Agreement between the States Attorneys General and representatives of the Tobacco Industry, the companies agreed to pay 46 states $205 billion over 25 years as reimbursement for past tobacco-related costs such as Medicaid expenditures and end marketing campaigns targeting minors and for other purposes1,2; in addition the other states negotiated their own agreements with the tobacco companies;
Being aware that the major tobacco companies have to date paid to these states more than $13.5 billion, which the states are using for various health related and, in some cases, non health related purposes2;
Knowing that the federal Centers for Disease Control and Prevention (CDC) has recommended that the states finance and develop nine components of a comprehensive tobacco control program with funding ranging from $5 to $30 per capita for each component2,3;
Applauding the few States that have used sizable amounts of the settlement funds for comprehensive tobacco control2,4;
Expressing concern that many states are spending their settlement funds for purposes other than tobacco control because data from recent reports by the National Conference of State Legislatures and the General Accounting Office indicate that only 5% to 7% of the funding nationally has been used for tobacco control2,4;
Knowing, further, that tobacco use causes more than 430,000 deaths annually in the United States and costs the nation approximately $50-$73 billion a year in medical bills2,5;
Being deeply concerned that tobacco use among young people, especially teenagers, remains one of our most critical health problems, and that three years after the settlement agreement tobacco companies are spending on marketing over $8.0 billion annually while state legislatures have only appropriated about $430 million in FY 2001 for tobacco prevention and cessation in all 50 States6,8;
Knowing also that no mechanism exists for reporting or commenting on the allocation and use of tobacco settlement funds by the states so that the public and advocacy groups can be informed about these expenditures,2
Noting that the experience in one state is likely to provide lessons for the nation, and that the Health Officers Association of California has urged the Governor of California to support allocating 15 cents of any tobacco tax increase to tobacco control and, in so doing has pointed out that:
- According to the Centers for Disease Control and Prevention (CDC), each pack of cigarettes sold in the United States costs the nation $7.00 in medical care and lost productivity;
- According the California Dept. of Health Services, every dollar invested in the California tobacco Control Program saves the state at least $3.00 in direct Healthcare costs and an additional $5.00 in avoided lost productivity;
- Although California has made great strides in tobacco control, much remains to be done to decrease smoking-related deaths and the staggering cost to the state of providing health care for those suffering from tobacco-induced diseases.7
Therefore,
- Calls upon each state having a settlement agreement with the tobacco industry to develop a reporting mechanism for the allocation and use of tobacco settlement funds (TSF) to be coordinated by the National Association of States Attorneys General, in collaboration with the National Governors’ Association and the National Conference of State Legislatures, thus providing information in sufficient detail to allow for scrutiny by the public as well as advocacy groups.
- Encourages the development of a hotline and clearinghouse to be established with the assistance of the American Legacy Foundation and other interested agencies or groups for reporting violations of the Master Settlement Agreement and for receiving comments from the public on allocation and use of TSF.
- Urges state public health officials and advocates to take a leading role in advising the Governors and state policy makers on the use of the TSF so as to assure adequate funding for tobacco control and public health activities.
- Strongly urges states to give priority to tobacco control and public health activities in the use of TSF funds at the present time and in the future.
- Further urges states to consider enacting a tax increase on cigarettes specifically designed for tobacco prevention and cessation efforts as one of the most effective strategies for tobacco control.
References
- Montgomery, B., Statement of the Attorney General of the State of Ohio on Allocating Ohio Tobacco Funds, before the Committee on Commerce, Science and Transportation, United States Senate, October 5, 2000.
- United States General Accounting Office, Tobacco Settlement: States use of the Master Settlement Agreement payments, Report to the Honorable John McCain, Ranking Minority Member, Committee on Commerce, Science, and Transportation, United States Senate, June 2001.
- Centers for Disease Control and Prevention, Best Practices for Comprehensive Tobacco Control Programs—August 1999. Atlanta, GA: US Department of Health and Human Services, Centers for Disease Control and Prevention, National Center for Chronic Disease Prevention and Health Promotion, Office on Smoking and Health, August 1999.
- National Conference of State Legislatures, State Management and Allocation of Tobacco Settlement Revenues, 1999-2001. NCSL publication, August 2001.
- Center for Disease Control and Prevention, Investment in Tobacco Control: State Highlights—2001. Atlanta, GA: US Department of Health and Human Services, Centers for Disease Control and Prevention, National Center for Chronic Disease Prevention and Health Promotion, Office on Smoking and Health, 2001.
- Campaign for Tobacco-Free Kids, American Cancer Society, American Heart Association, and the American Lung Association, Show us the money: An Update on the States’ allocation of the tobacco settlement dollars, Campaign for Tobacco-Free Kids publications, updated January 15, 2002.
- Letter dated June 7, 2002 from the Health Officers Association of California to the Honorable Gray Davis, Governor of California
- Peter D. Jacobson, Paula H. Lantz, Kenneth E. Warner, et al, “Combating Teen Smoking: Research and Policy Strategies, Ann Arbor, MI 2001: University of Michigan Press, 2001.
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