Funds for tobacco education, cessation are safe – for now
FRISCO – Laurie Blackwell is breathing a little easier these days.
The state Joint Budget Committee (JBC) last week nixed Gov. Owens’ proposal to securitize the state’s tobacco funds, a move that will – for now – leave intact tobacco education and cessation efforts.
“I am shocked; I really am,” said Blackwell, tobacco cessation coordinator with the Summit Prevention Alliance. “I’m excited about that. I don’t know what it means for the future of what’s left of the money that’s not securitized, but I’m glad they made that decision.”
Under an agreement state Attorney General Gale Norton forged in 1995, the tobacco industry must pay Colorado $2.6 billion over 25 years to help pay for tobacco-related illnesses. Other states also received various amounts of money under the agreement.
The first year of its implementation, Colorado was allocated $15 million under the terms of the agreement. That’s down to $3.6 million this year, Blackwell said, primarily because the Legislature transferred tobacco funds to cover shortfalls in other state departments.
The recent poor economy has legislators searching for revenue to cover the basics. And many turned to their tobacco funds to do so.
Last year in Colorado, the JBC diverted millions from the funds to cover part of an $850 million deficit.
Then Owens proposed securitizing the funds, which involves selling tomorrow’s anticipated tobacco funds for a lump sum of money today. Under his proposal, the state would sell what’s left of Colorado’s allotment for a lump sum of about $800 million. The bonds then would be repaid using future proceeds from Colorado’s share of the national agreement with tobacco companies.
Owens proposed putting $80 million of that toward this year’s budget and the rest into a “rainy day” fund. Senate Majority Leader Norma Anderson, R-Lakewood, is sponsoring legislation supporting that plan.
The proposal was met with mixed reviews. Some legislators, frustrated after weeks of wrangling to balance the budget, were ready to securitize the funds. Others said it was fiscally irresponsible and wouldn’t solve the state’s long-term financial challenges.
Blackwell and others in her position aren’t out of the woods yet, however.
The state Constitution requires the Legislature to submit a balanced budget each year, and the poor economy forced legislators last year to take funds from the tobacco settlement act to do so.
This year, the state faces a $60 million shortfall for the second half of this fiscal year, which ends in July. Legislators also have to find a way to fill a $125 million shortfall for next fiscal year.
Jane Stebbins can be reached at (970) 668-3998, ext. 228, or
Support Local Journalism
Support Local Journalism
As a Summit Daily News reader, you make our work possible.
Your donation will be used exclusively to support quality, local journalism.
If you don't follow the rules, your comment may be deleted.
User Legend: Moderator Trusted User