State funds anti-tobacco campaign
This year's budget of $9.4 million will start West Virginia in its campaign against tobacco use, the commissioner of the Bureau of Public Health said Monday, even though the federal government says the state should spend more.
"It lays a very strong foundation," Dr. Henry Taylor said after Monday's meeting of the Legislative Oversight Committee on Health and Human Resources Accountability. "At the same time, it doesn't open up the floodgates."
According to the federal Centers for Disease Control, West Virginia should be spending at least $14 million a year for a comprehensive anti-tobacco campaign, Taylor conceded.
"We're running a program with a budget of $9 million, and recognize that the CDC says we won't see a sustained impact until we get to the minimum for a comprehensive program," he said.
He said the complexity of tobacco addiction requires a complex and explicit strategy to prevent its use.
"I feel we're being accountable and reasonable with the expenditure of this money," he told committee members.
"A lot of this concentrates on youths," he said. "Youths are the primary group that are being targeted by tobacco marketers."
The most visible part of the campaign, a $2.2 million counter-marketing campaign, is set to launch in November. Contracted to the MBC Group, the campaign will include TV, radio and newspaper ads, among other anti-tobacco efforts.
Other big-ticket items include $1.5 million for tobacco cessation programs, $1.09 million for school programs, and $1.02 million to enforce laws against tobacco sales to people under 18.
Taylor said that $1.02 million includes $825,000 the state agreed to spend instead of paying a penalty under the federal Synar legislation.
The state was fined that amount last year for failing to meet mandated goals for restricting retail sales to minors.
Nearly $200,000 of that amount will go to help the State Police conduct year-round sting operations on tobacco retailers.
Also Monday, Administration Secretary Greg Burton continued to tout his proposal to sell bonds against future payments to the state from the nationwide tobacco settlement.
In essence, the bonds would allow the state to get 25 to 30 years of settlement fund money up front.
Currently, half of each year's settlement goes into general revenue, and half goes into the state's Medical Trust Fund. Under state law, the state cannot spend the principal in that fund, which currently contains about $67.5 million and provides about $2.5 million in interest income.
Burton said Monday the administration only intends to sell bonds for the half of the settlement that goes into the trust fund.
He said it makes sense to sell the bonds, and shift the risk to bond-holders in the event that tobacco usage in the country sharply declines.
This year, the actual settlement payment to the state was about 10 percent below the original projection because of declining tobacco sales, he said.
Burton conceded Monday that investment brokers had approached the administration about the deal.
"Obviously, they approached us to do it, but if you look at it like other states, cities and counties, they looked at it as a windfall," he said.
Burton said the state could cap brokerage fees in the bond issue, the way it did in the still on-hold plan to sell up to $4 billion in pension bonds.
He also noted that, once the bonds are paid off, the settlement payments would come back to the state.
"It goes back to the way it was, if payments are still being made, they would go into the Medical Trust Fund," he said.