By John D. Montgomery
January 19, 2016
Remember back in the 1990s when many states sued the tobacco companies? The basis of their lawsuit was that tobacco had caused widespread illness – lung cancer, heart disease, et cetera – and they sued for damages because of the high costs to their public health care systems.
In 1998, 46 states were part of a settlement that basically made the tobacco companies pay an estimated $246 billion over 25 years in exchange for protection from private legal liability for health care claims.
Enough with the history lesson, except to remember that a big chunk of the money was to be used for smoking prevention and cessation programs and, more to the point, to remember what Kansas decided to do with its share of the settlement.
A bunch of lawmakers got together and had to decide what was the responsible way to spend that money in Kansas. Imagine if they all settled on the notion of using the money to eliminate the income tax for a wide swath of businesses and cutting taxes for the wealthy? Some might ask how income taxes to benefit the well-off population would have any relationship to the compensation the state sought for its tobacco-related health care costs.
That’s in fact not what the Kansas leadership decided at the time. Instead our lawmakers decided to use the money – besides tobacco prevention and cessation programs – on early childhood programs. They created the Kansas’ Children’s Initiatives Fund in 1999.
Technically, the repository is the Kansas Endowment for Youth, from which money budgeted for the CIF may be withdrawn. The CIF supports a number of programs across the state such as Parents as Teachers and Smart Start.
Tobacco settlement to pay for children’s programs? Sounds good. Except that about the time of the big income tax cut, Gov. Sam Brownback’s administration started diverting the money to the state’s general fund. And in the governor’s just-released budget for next fiscal year, he proposes diverting all of the CIF’s annual $57.3 million into the state general fund.
The governor claims that all of the CIF programs will go unharmed, but critics are skeptical. They’ve got good reason.
Diverting any money earmarked for the CIF programs amounts to a broken promise to all Kansans who forfeited their individual right to settlement. And arguably it is just plain illegal absent legislative action to dissolve the CIF and legislate a new mechanism for accounting for the tobacco settlement receipts.
By the way, guess how much Kansas spends on tobacco prevention and cessation? Try 1.5 percent of its annual settlement proceeds.
Early-childhood programs may or may not go untouched by the state’s budget squeeze, but any attempt to circumvent the CIF should be done with complete transparency and with an authentic conversation about what’s the right way to be responsible with the tobacco settlement money that belongs to all Kansans.