Few Settlement Dollars Used for Tobacco Control

When the states reached their historic $206-billion settlement last year with cigarette manufacturers, attorneys general from around the nation proclaimed that the whole purpose of their massive lawsuit was not to win money but to prevent teenage smoking.

The settlement document says three times in its first two pages that its purpose is to stop children from becoming addicted to cigarettes.

But a year later, here are some of the state efforts being funded by the legal settlement with the cigarette manufacturers: new sidewalks, tax cuts, boot camps and school construction. In some states, little, if anything, is being spent on anti-smoking programs.

So far, just 8% of the money is earmarked for anti-smoking programs, according to the National Conference of State Legislatures.

In Texas, lawyers for the state will get 10 times the amount this year that is going into anti-smoking programs. In Michigan, not a penny of the settlement money will fund tobacco control.

Of the 23 states that have decided how to spend their money, the majority appear to view the dollars primarily as a hefty new revenue source to be spent on whatever the state needs.

Anti-smoking advocates say that the states are playing, perhaps unwittingly, into the hands of cigarette manufacturers, who the advocates say have no interest in seeing the money go into prevention or cessation programs.

“The tobacco companies knew when you put billions of dollars into the hands of state government officials, there would be an enormous grab for the money from all different sources . . . and that a substantial portion of the money would be diverted away from anything to reduce tobacco use,” said Matthew Myers, president of the National Center for Tobacco-Free Kids.

But the tobacco companies maintain that they want the money to be spent on youth smoking prevention. In part for public relations reasons, they have decided it is in their interest to advocate that children wait to start smoking until they are of legal age.

“The settlement was signed in a spirit of addressing the youth smoking problem, and we believe the states can do far more than they have,” said Thomas Ryan, a spokesman for Philip Morris USA.

Philip Morris officials have testified before four state legislatures this year in favor of more spending on teen smoking prevention. Their efforts have met with a lukewarm reception.

Most of the 46 states that signed the $206-billion settlement with the tobacco manufacturers in 1998 began getting their money last week. They are scheduled to receive $8.7 billion over the next year. The rest of the money will be paid out over the next 25 years.

Four more states--Mississippi, Texas, Florida and Minnesota--reached separate settlements totaling $40 billion over 25 years.

The tobacco companies are financing the settlement payments primarily with increased cigarette prices, which are paid by smokers. Since the settlement was announced last fall, the per-pack price has risen about 55 to 65 cents, according to cigarette company officials. Tax increases in some states have pushed prices even higher.

The settlement provides for a reduction in payments if smoking levels drop. Industry critics have noted that the big infusion of money to the states--and the use of that money for an array of new programs--gives state officials an interest in a healthy and prosperous tobacco industry.

“The tobacco industry was laughing all the way to the bank when they signed this agreement,” Myers said.

A large share of the total settlement, about 54% of the money allocated, is going to a broad range of health-related programs, including augmented health benefits for state workers and funds for biomedical research.

The Centers for Disease Control and Prevention issued guidelines suggesting that 20% to 25% of the settlement dollars in most states should be spent on comprehensive anti-smoking programs. Only a handful of the states are meeting those guidelines. California is something of an anomaly. While it has not directed any of its settlement dollars to anti-smoking programs, it has one of the largest tobacco control programs in the country, which is funded through a cigarette excise tax.

To be sure, the proportion of the settlement scheduled to be spent on smoking prevention and cessation is likely to grow as more states decide how to spend the money, said Lee Dixon, director of the Healthcare Tracking Service for the National Conference of State Legislatures.

“Some people would say, ‘How much money can be spent efficiently in a given year on this problem?’ ” Dixon said.

“Many states have gone through a very public process of soliciting information and testimony and, to some extent, the states’ decisions ought to reflect the peoples’ will, based on the testimony.”

However, the direction the states are heading makes it look unlikely that a majority will come anywhere close to meeting the CDC guidelines.

Christine Gregoire, the attorney general of Washington and one of the leaders in the state settlement negotiations, said that she has just completed a package of information for her fellow state attorneys general to arm them in negotiations with their governors and state legislators over how to spend the money.

“The problem with what’s going on in the states is that legislators are looking at it as revenues . . . the same way they look at taxes,” said Gregoire, who lobbied the Washington Legislature and governor to generously fund smoking cessation and prevention programs.

California, whose settlement was divided between state and local jurisdictions, has similarly put all the state dollars into its general fund while cities and counties are deciding what to do with their allocations. On the table in Los Angeles are such items as new sidewalks and curbs so that the city can come into compliance with the Americans With Disabilities Act.

There is little doubt, according to several recent studies, that when states do enact major anti-smoking programs--including anti-smoking advertisements, school-based education and grass-roots activities--that has an effect on teenagers’ smoking decisions. For instance, in Massachusetts, which has had a comprehensive program for several years, a recent survey by the state Department of Education found that the number of high school students who reported smoking cigarettes in the month before the survey had fallen from a high of 35.7% in 1995 to 30.3% in 1999.

In neighboring Rhode Island, which has roughly the same demographics but has yet to put in place a comprehensive program, teen smoking has increased from 21% in 1993 to 34% in 1999, according to a survey by the state Health Department.

When Congress proposed a broader settlement, about a third of the money would have been designated to combat teen smoking and encourage cessation. But many states, noting that there are no restrictions in the current settlement on how states can spend the money, have argued that they should be able to put it where their legislators see the most need.

That is certainly Michigan’s defense in explaining its decision to ignore anti-smoking programs in favor of education. The state has the fourth-highest smoking rate in the country, and the CDC said that to stem youth smoking it would have to spend $53 million a year.

“We already spend millions on an anti-tobacco campaign. . . . We spend about $8 million” annually, said John Truscott, spokesman for Republican Gov. John Engler.

“It’s the governor’s opinion that people know that smoking is dumb, and to spend another $10 million wouldn’t be much use,” Truscott said. “But the more education people have, the less likely they are to smoke.”