Tobacco Money Seen as Possible Deficit Remedy

As supervisors begin debating how to address the county’s financial problems next month, one of the first issues they will tackle is whether to dip into $8.3 million in tobacco settlement dollars.

Supervisors recently learned that the county may receive the entire tobacco payment by April 15, raising the possibility that the money can be tapped to bail the county out of a projected $5-million deficit.

A majority of supervisors on Monday indicated they are willing to use at least a portion of the money to pay for millions of dollars in unanticipated expenses brought on by last year’s mental health care merger and a federal Medicare lawsuit--the primary causes of the county’s fiscal troubles.

Supervisors John K. Flynn and Kathy Long said such payments would be a legitimate use of the tobacco settlement dollars, generated by a states’ lawsuit against the major tobacco companies to recover the costs of treating smoking-related illnesses.

Keith Jajko, senior aide to Supervisor Judy Mikels, said the Simi Valley supervisor, who is out of town, would also likely support a bailout plan, since the costs are related to health care.

Supervisor Frank Schillo, however, said he is unwilling to use the tobacco dollars to pay for costs related to last year’s merger.

“Instead of using new money to pay for old problems, I’d like to see that money used for things like housing for the mentally ill,” Schillo said.

In a Dec. 3 report to supervisors, Health Care Agency Director Pierre Durand said payouts associated with the merger and lawsuit will cost at least $4.1 million this year. Last week, the board agreed to spend $1 million to cover the cost of a monitoring program for health care billings.

Using the tobacco dollars to cover some of those costs is a good option, Flynn said.

“Those costs have added up enormously,” the Oxnard supervisor said. “We need to look at how that money could be used to help out the Health Care Agency.”