State wasting tobacco settlement money, surgeon general says
The U.S. surgeon general says South Carolina's plans to spend much of its tobacco settlement on public-works projects, economic development and payments to tobacco growers squanders an opportunity to make a difference in the future health of its citizens.
"A lot of young people addicted to smoking before 18 will spend the rest of their lives regretting it and trying to quit," Dr. David Satcher told The Greenville News Tuesday.
"We know comprehensive strategies prevent teens from beginning to smoke and to help those who already smoke to quit," he said. "Taking advantage of the settlements (for prevention programs) would save a lot of unnecessary pain and suffering and would be one of the best investments we can make, like a polio vaccine."
The settlement resulted from a lawsuit brought against tobacco companies by states seeking to recoup health-care costs associated with tobacco-related illnesses suffered by Medicaid recipients.
Satcher has been critical of states' settlement spending plans, noting that on average they are allocating less than 10 percent for smoking prevention programs.
Initially, South Carolina was due to receive $3.2 billion from the settlement over 30 years, said Gov. Jim Hodges' spokesman, Morton Brilliant. But instead, he said, officials decided to sell securitized bonds guaranteeing an immediate payment of about $800 million, reasoning that the money can be put to work right away and eliminating any risk associated with the future of the tobacco industry.
The settlement imposed no restrictions on how the money is spent, Brilliant said, and each year the Legislature will allocate the funds. Beginning next year, 73 percent of the money will go for health care; 15 percent will go to tobacco farmers; 10 percent will be used for economic development in rural areas; and 2 percent will go for water and sewer projects. State lawmakers next spring will decide which projects to fund.
In the first two years of the settlement, South Carolina received $165 million, and in June the Legislature voted to spend $1.75 million of it -- or about 2 percent -- on tobacco use prevention programs, Brilliant said. Hodges had requested $11 million for prevention, he said.
Like Satcher, anti-smoking activists in South Carolina are unhappy with the Legislature's spending plan, saying it doesn't go far enough to address smoking prevention for the one in four South Carolina adults and nearly 40 percent of high school students who smoke.
"There's been a lot of talk about doing general infrastructure things, road construction, bridge construction," said Thomas Gillette, director of the tobacco control program of the state Department of Health and Environmental Control's Bureau of Community Health.
"We got this money because tobacco was causing a tremendous health problem," Gillette said. "We should use it for health, not as a windfall for other areas."
Although 73 percent will be spent on health-care measures such as Medicaid expansion and the senior-citizen prescription drug program, it hasn't been determined how much will go for smoking prevention, said Greg White of the American Lung Association's South Carolina chapter.
"The legislators will decide which initiatives to fund and my biggest fear is how far can we stretch the term health care," White said. "The money needs to go to important health care needs for South Carolina, not be used as a political opportunity."
Carol Reeves, director of the Greenville Family Partnership, a private nonprofit alcohol and drug prevention agency, called the legislative process a "money grab.
"Our state looked at this as a windfall," she said. "The legislators are making irresponsible decisions at the only opportunity we really had to make a difference. The settlement funds should be used to stop young people from smoking, to reduce teen access to tobacco products, and to educate people about the dangers of smoking."
State Sen. Warren Giese, R-Columbia, said that like most legislation, the final plan was a compromise.
"It takes an entire Legislature to pass a bill," he said. "Legislators from the tobacco growing areas fought to keep money for growers and those of us with health objectives felt that all money should go to the health care of people injured by smoking tobacco."
Rep. C. Anthony Harris, D-Cheraw, agreed.
"It was controversial," he said. "But ultimately, we probably did about as good a job as we could have to balance spending of that money on medical programs while trying to recognize the farmers' hardship. It's kind of like a plant closing."
Tobacco makes up 10 percent of South Carolina's crops, with receipts totaling $131 million, Brilliant said. And South Carolina earned $29.8 million in 1999 from the tobacco products tax, up from $26.3 million in 1995, according to the state Department of Revenue. Those figures do not include sales tax.
But Sen. Darrell Jackson, D-Hopkins, said growers should get none of the money.
"This settlement was not to help tobacco farmers," he said. "It was based on the health impact and what society has suffered. The people hurt were smokers. It was a compromise. But the prevention community got shafted."
Satcher says a state should devote a minimum of 25 percent of its tobacco settlement funds to run a meaningful prevention program. In South Carolina's case, said Gillette, that would be about $23 million a year. Spending any less, Satcher said, is "penny wise and pound foolish."
* Four of 10 high school students smoke
* 12 percent of high school boys use smokeless tobacco
* 4,100 residents die of smoking-related illnesses each year
* 15,000 children become new smokers every day
* 240,000 children are exposed to second-hand smoke in the home
* 4.3 million packs of cigarettes are sold illegally each year