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Take tobacco cash before it's all gone

March 05, 2002|BY BOB MAGINNIS

Compared to the battles over video poker and the restructuring of the family court system, West Virginia Gov. Bob Wise's proposal to take an advance payment on the state's share of the national tobacco tax settlement hasn't drawn much attention. It should, because a wrong move on this issue could affect the state for decades to come.

Wise's proposal would have the state take $600 million now, instead of waiting 25 years for payments that could eventually total $1.9 billion. If the state waits for the money, it has to assume that the tobacco companies will still be in business years from now.

Is that a valid assumption? Maybe not. The anti-smoking forces are pressing for higher taxes on the product to discourage teen use of cigarettes while new advertisements key on the ill effects of smoking, at a time when tobacco makers aren't allowed to advertise anywhere without warning labels that discourage would-be smokers. Put it all together and in 20 years, cigarette smoking may be as rare as cigar use is today.

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On the other side are those who say that the tobacco money, or at least a large share of it, should be used for health-related programs, like stop-smoking classes. Wise proposes using $400 million to issue bonds that would enable the state to pay off the teacher- retirement system's debt six years early, saving the state $3.1 billion.

Taking the money now would also make it unavailable for use in balancing future budgets, which means lawmakers must be sure they're ready to throw out that fiscal safety net.

In our view, taking the cash now makes sense, because between lawsuits and other measures that discourage tobacco use, there may not be enough cash to pay off that settlement.

But taking the money now should come with one proviso. Any deal to do that should commit the state to put a certain percentage of the future savings into stop-smoking and related health programs. The worst possible outcome would be to get to the end of the money and still have a significant number of West Virginians addicted to tobacco.

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