SUGGESTED
STATE
LEGISLATION

2000 Volume 59

TOBACCO SETTLEMENT LEGISLATION
SUPPLEMENT

   AUGUST 1999

Developed by the
Committee on Suggested State Legislation

The Council of State Governments
Lexington, Kentucky 

    The supplement is a compilation of ideas about how states will spend the money that they receive from the tobacco lawsuit. Due to the variety of ideas, the SSL committee chose to present viable and non-viable legislation in this document as well as enacted bills. The status of each item is the latest that SSL committee staff could obtain as of July 21, 1999.

Contents
I.   Waiting to Exhale
II.  Links to state legislation table
III. Abstracts of state legislation
IV. Appendix
        a. Summary of Tobacco Settlement Agreement
        b. Model Consent Decree
        c. Model Statute
        d. Strategic Contribution Awards - total payments to states - ranked by population and per capita

Tobacco Settlement

Waiting to Exhale

Weighing proposals to spend $206 billion in tobacco settlement money.
by
Chester Hicks, Southern Regional Coordinator for The Council of State Governments

June 1999
(updated July 1999)

    Governors and legislators from 46 states are considering how to spend the $206 billion tobacco settlement pledged over the next 25 years. Florida, Minnesota, Mississippi and Texas have separate agreements with tobacco manufacturers to receive a total of $40 billion. As of late April, more than 400 bills had been introduced in states to deal with settlement money.
    Two tobacco-growing states this spring agreed how to spend their money. Virginia, the nation’s fifth largest tobacco producer, became the first state to establish a formula for distributing money from the national settlement. Under the legislative formula, farmers will get half of the state’s $4 billion share and 10 percent will go to programs to discourage youth smoking. The proposal sailed through the General Assembly without a public hearing, and without a dissenting vote among the 140 lawmakers in the session that ended Feb. 28. The state will determine how to spend the remaining 40 percent next year. Lisa Myers Becker, a lobbyist for the American Heart Association, said, "a lot of my counterparts across the country don’t understand why we only went for 10 percent. It was as much as we could have expected in a state like Virginia with our history with tobacco."
    In North Carolina, lawmakers approved a bill channeling the state’s share of the settlement into a foundation and two trust funds. The foundation, set up in compliance with a court consent decree, would use the money to help communities hurt by the decline of tobacco. The foundation would receive half the money, or $2.3 billion, over 25 years. The two trust funds, one for tobacco farmers and quota holders and another for health programs, would each get a quarter of the settlement, or about $1.15 billion. In a news conference, House Speaker Jim Black said tobacco farmers would come to see the benefits of the bill. Money for farmers will be set aside for education, transition to alternative crops and general hardship. Health advocates, who wanted more money to fund community health programs, said that they could live with the compromise because there was a chance they would not get anything otherwise.

Trust us

    Most state proposals call for establishing trust funds on everything from children’s health care to water development. "The trust fund approach seems to be pretty popular because the amount is up in the air," said Joy Johnson Wilson, director of the health committee for the National Conference of State Legislatures. "(With) a trust fund, you’re not creating anything new, but it gives you a place to put the money."
    Louisiana considered proposals for a Tobacco Settlement Trust Fund, a Louisiana Smoke-Free Health Fund, and a fund in the state Department of Treasury for each public school district. Some bills would put part of the money in a trust fund and spend only the earnings. State Commissioner of Administration Mark Drennen expects the state to divide the money among a trust fund, research and an anti-tobacco program. "But, how much will depend on what happens with all our other revenue sources," he said.
    A 1999 Utah law created a restricted account within the general fund to receive all funds from the settlement. Funds in the account may only be used as directed by the Legislature through appropriation.
    Also in the West, Wyoming created a trust fund similar to Utah’s. Wyoming’s new fund will accept revenue from the tobacco settlement as well as other funds. Only the Legislature can appropriate the trust funds and then only for purposes related to the improvement of public health.
    Hawaii's Tobacco Prevention and Control Trust Fund will be "a separate fund of a nonprofit entity having a board of directors and qualifying under section 501(c)(3) of the Internal Revenue Code of 1986, as amended, into which shall be deposited twenty-five percent of moneys received" (see Hawaii SB 1034, Act 304 of 1999).
    Nebraska established a trust fund in 1998, before the settlement was reached. It started the Excellence in Health Care Trust Fund with some of the state’s Medicaid money. The legislation limited spending to annual interest on the principal.
    North Dakota House Majority Leader John Dorso backed a new law that created a Water Development Trust Fund. The trust fund will receive tobacco dollars until there is enough money to pay the interest and principal on any bonds sold to finance state water projects and make such bonds more marketable. The law allocates 10 percent of the settlement to fund health programs, 45 percent toward water development and 45 percent toward public schools.

Special boards and committees

    Kansas adopted legislation (H 2558) that reserves the tobacco settlement money in a trust fund for spending on children. The new law requires that settlement money be used to provide additional funding for programs and other purposes beneficial to the physical and mental health, welfare, safety and overall well-being of children in Kansas. The first transfer to the fund of $45 million will take place on July 1, 1999, or as soon thereafter as money is available.
    A 1999 West Virginia law created the State Tobacco Growers’ Settlement Board. The board reached a settlement with the leading U.S. tobacco product manufacturers for the exclusive benefit of state tobacco growers. The board also will determine how funds allocated to the national tobacco community trust will be distributed among state tobacco growers to compensate them for adverse effects of the settlement. Along with the creation of the board, West Virginia created a special settlement fund for the deposit of 50 percent of the tobacco money appropriated by the Legislature for Medicaid and other health-related programs.
    Louisiana’s Revenue Estimating Conference approved using up to $110 million from the tobacco settlement for balancing next year’s state operating budget. However, the action by the conference, comprised of top state officials and a college economics professor, did not relieve any pressure on lawmakers in deciding on next year’s $13.2 billion budget.
    Gov. Mike Huckabee plans to call a special session this summer to discuss how to spend Arkansas’ $1.62 billion settlement. "I think all of us feel a real sense of responsibility to put something in motion that addresses what is a long-term problem and a long-term solution to get out of it," he said. Also, Huckabee wanted the House and Senate interim committees on Public Health, Welfare and Labor to meet after the end of the legislative session to develop a specific, long-term plan for spending the money.

Extra funds

    Several states will receive extra funds for their role in the settlement with the tobacco industry. However, the states will not begin collecting the money until 2008, and it will end in 2017. A panel of three former attorneys general from California, Oregon and Tennessee decided how to divvy up the newly created $8.6 billion fund based on the extent of a state’s contribution to the litigation or resolution of the lawsuit.
    New York’s share is the largest at $471 million, and California’s is next at $445 million. Other states that will receive the bonus include Arizona, Connecticut, Hawaii, Maryland, Oklahoma, Vermont and Washington.
    In addition to their original share of the settlement windfall, tobacco-growing states will receive an additional $5.15 billion trust fund from the tobacco industry. According to the Associated Press, these states include Kentucky, Maryland, North Carolina, Pennsylvania, South Carolina, Tennessee and Virginia. The distribution plan will use the 1998 basic quota system set by the U.S. Department of Agriculture, according to North Carolina Attorney General Mike Easley and other officials. "It’s the most equitable way and what our farm groups want here. All states come out pretty much even with that," Easley said.
    North Carolina, the largest flue-cured tobacco-state, and Kentucky, the top burley tobacco producer, would receive the biggest shares under the proposal. The fund was created to aid tobacco farmers expected to be squeezed by the higher cigarette prices and curbs on tobacco promotion that are a part of the $206 billion multistate settlement.
    Although specifics have not been nailed down, states have taken the windfall settlement seriously. All concerned groups (including farmers and health advocates) have given their recommendations and state officials have responded. As payments from the overall settlement start next year, we will see how states further divide the proceeds.
    Finally, in May 1999 Congress passed Title I, Chapter 11; Sec. 3031 of H.R. 1141 (Emergency Supplemental Appropriations) to amend the Social Security Act to prohibit treatment of funds recovered or paid from tobacco companies to a state, in a comprehensive or individual state settlement or court judgment, as an overpayment under Medicaid. The provision allows states to use such funds for any expenditures they deem appropriate, but prohibits certain payments for administrative expenses incurred in pursuing such tobacco litigation. The bill was signed by the President on May 21, 1999.

State Legislation - Links to Full-Text

* This symbol indicates that the full text of this legislation is available in the paper copy of this supplement. Readers should note that some of the legislation listed below could easily fit under more than one category. The status of each bill is the latest information that CSG could obtain as of 07/21/99.

State Legislation - Abstracts

AID TO TOBACCO FARMERS

CONNECTICUT
Tuition Assistance
PB 537
Status: died in committee in April 1999.

    This bill would amend state law to establish a tuition assistance program for students who have a B average or higher to attend state institutions of higher education and to fund the program with money from the tobacco settlement.

GEORGIA
Tobacco Community Development Board
Georgia
HB 872
Status: signed into law as Public Act 361 in April 1999.

    This Act creates the Georgia Tobacco Community Development Board and authorizes the board to determine an equitable allocation of private trust funds among tobacco growers and tobacco quota owners. It authorizes the board to certify to private trustees instructions for payment of private trust funds to eligible tobacco growers and tobacco quota owners.

INDIANA
Grants to Develop New Commodities or Subsidize Farm Losses Due to Reduced Indiana Tobacco Production
HB 1759
Status: died in committee in January. 1999.

    This bill appropriates from the tobacco lawsuit settlement $20,000,000 for each of the next 25 years to the department of agriculture to make grants to develop new farm commodities in tobacco producing counties or to subsidize tobacco farmers for losses due to reduced tobacco production.

INDIANA
Grants to Owners of Tobacco Production Rights
HB 1454
Status: died in committee in January 1999.

    This bill appropriates a total of 30 percent of the tobacco lawsuit settlement for the next 25 years.Twenty percent is appropriated to the department of agriculture to make grants to those that own rights to tobacco production on January 1, 1999. Ten percent is appropriated to Purdue University for development of new crops to replace tobacco.

KENTUCKY
Tobacco Growers’ Assistance and Diversification
SB 247 (enrolled version)
Status: signed into law by Governor on April 14, 1998.

    This Act establishes in the State Treasury a permanent and perpetual fund to be known as the "Agricultural Diversification and Development Fund" to which shall be credited any increase in the cigarette excise tax subsequent to the effective date of this Act; gifts; bequests; endowments; grants from the United States government, its agencies and instrumentalities; any funds from the tobacco settlement agreement or related federal legislation for tobacco farmers or tobacco-dependent communities specifically appropriated to this fund by the General Assembly from the fund created in Section 3 of this Act; and funds received from any other sources, public or private. The fund shall be administered by the Agricultural Diversification and Development Council created under Section 1 of this Act.
    This Act establishes in the State Treasury a permanent and perpetual fund to be known as the "Tobacco Settlement Agreement Fund" to which shall be credited any funds designated to the Commonwealth from the tobacco settlement agreement or related federal legislation. Any funds designated to the Commonwealth from the settlement agreement or related federal legislation shall not be expended until appropriated by the General Assembly. The General Assembly's highest priority for distributing any funds from this account shall be for tobacco farmers and tobacco-impacted communities and health-related areas.
    The money in the agricultural diversification and development fund under Section 2 of this Act shall be distributed to one (1) or more of the following:
    (1) The state's owners of the tobacco basic quota based on the percentage of each owner's tobacco basic quota compared to the state's total tobacco basic quota as certified by the United States Department of Agriculture;
    (2) The state's individuals or entities growing tobacco based on the percentage of tobacco basic quota being raised by the individual or entity, compared to the state's total tobacco basic quota as certified by the United States Department of Agriculture;
    (3) The Department of Agriculture to be used for marketing, agricultural diversification, and development as provided in Section 6 of this Act;
    (4) The Purchase of Agricultural Conservation Easement Corporation created in KRS 262.900 to 262.920;
    (5) The University of Kentucky and Kentucky State University extension service programs and the University of Kentucky College of Agriculture to carry out the duties and responsibilities as provided in Section 7 of this Act; and
    (6) Owners of tobacco quotas, tobacco growers, and tobacco-dependent communities to be determined by the Agricultural Diversification and Development Council.

NORTH CAROLINA
Exempt Tobacco Settlement Payments
North Carolina
SB 794
Status: referred to Judiciary I Committee in April 1999.

    This bill exempts payments under phase I and phase II of the tobacco settlement agreement from execution except for debts incurred for farming operations in calendar years 1999 and 2000.

NORTH CAROLINA
Tobacco Funds for Alternatives Research
HB 479
Status: assigned to Education Subcommittee in April 1999.

    This bill appropriates tobacco settlement funds for university-based research on alternatives to tobacco for farmers.

SOUTH CAROLINA
Family Farm Relief Fund
General Bill 309
Status: pending in Agriculture and Natural Resources Committee as of 07/20/99. This bill will probably carry over into the second part of the current legislative session, which reconvenes in January 2000.

    This bill creates a Special Family Farm Relief Fund to receive a third of South Carolina's settlement proceeds derived from the tobacco litigation settlement to be utilized to ease the transition for small farmers from tobacco farming to some other form of agricultural staple.

SOUTH CAROLINA
Tobacco Indemnification and Community Revitalization Commission and Fund, South Carolina Settlement Fund; Agriculture
General Bill 714
Status: pending in Senate Agriculture and Natural Resources Committee as of 07/20/99. This bill will probably carry over into the second part of the current legislative session, which reconvenes in January 2000.

    This bill establishes the Tobacco Indemnification and Community Revitalization Commission and Fund. It provides for the distribution of the money received by the state pursuant to the Master Settlement Agreement with tobacco product manufacturers and amends state law to establish the South Carolina Tobacco Settlement Foundation.
    The bill directs that the commission should use the money in the fund to indemnify tobacco growers and warehouses from the adverse economic effects of the Master Settlement Agreement and to revitalize tobacco dependent communities.

TENNESSEE
Scholarships for Tobacco Farmers
HB 803
Status: introduced in House and referred to Finance Committee in February 1999. The Senate version (SB 1499) was left in Senate Finance Committee as of 07/20/99. The Senate version will carry over to the next legislative session.

    This bill allocates a minimum of $1,000,000 annually from the funds received by the state pursuant to the Attorneys General master tobacco settlement agreement for the term of such agreement, to a scholarship fund for active tobacco farmers and their immediate family members. The money allocated to the scholarship fund shall be used exclusively for tuition and ancillary expenses associated with obtaining a postsecondary education. The Commissioner of Agriculture is authorized to promulgate rules and regulations to effectuate the purposes of the bill.

VIRGINIA
Tobacco Indemnification and Community Revitalization Commission and Fund
Status: CH 880, Laws of 1999

    This Act establishes the Tobacco Indemnification and Community Revitalization Commission to administer funds received by the Tobacco Indemnification and Community Revitalization Fund. The Fund shall receive 50 percent of the funds received by the Commonwealth pursuant to the tobacco Master Settlement Agreement. The Commission shall use the money in the Fund to make payments to tobacco farmers and for projects in tobacco dependent communities. The bill also creates the Virginia Tobacco Settlement Fund, to receive 10 percent of the funds received by the Commonwealth under the Master Settlement Agreement. This Fund shall be administered by the Virginia Tobacco Settlement Foundation. This Fund will be used to finance efforts to limit the use of tobacco products by minors.

WEST VIRGINIA
Tobacco Growers’ Settlement Board
SB 697 (enrolled version)
Status: enacted into law in March 1999.

    This Act creates a "state tobacco growers’ settlement board" consisting of three members: the governor, the attorney general and the commissioner of agriculture or their designees. The duties and responsibilities of the state tobacco grower board include:
    (a) The consummation of a settlement with leading United States tobacco product manufacturers for the exclusive benefit of state tobacco growers;
    (b) The execution of all necessary written agreements relative to the national tobacco community trust to ensure state tobacco growers’ receipt of funds directly from the trust;
    (c) Consultation with tobacco growers within the state in order to determine how funds allocated by the national tobacco community trust shall be distributed among state tobacco growers to compensate them for the adverse effects of decreased consumption, demand and price for cigarettes;
    (d) The submission of a plan to the national tobacco community trust identifying state tobacco growers and the distribution of trust funds to state tobacco growers; and
    (e) The certification of instructions annually to the national tobacco community trust regarding distribution of funds from the trust directly to the state tobacco growers during the twelve year payment period, beginning in 1999.

DEBT REDUCTION

NEW YORK
State Debt Reduction Fund
S 1217
Status: amended and pending in Finance Committee as of 07/20/99.

    The bill establishes the New York State Tobacco Settlement Debt Reduction Fund. It provides that such fund shall consist of all money obtained by the state from tobacco settlements negotiated with the tobacco industry or the federal government and requires all such money to be used for the sole purpose of reducing the general obligation indebtedness of the state.

RHODE ISLAND
Commission to Study Paying Down State Debt
S 284
Status: died in Senate Finance Committee in March 1999.

    This resolution creates a nine (9) member special legislative commission whose purpose it shall be to study the feasibility of using the tobacco settlement proceeds to pay down the state debt and who shall report back to the Legislature no later than February 2, 2000 and whose life shall expire on April 2, 2000.

EDUCATION/PREVENTION

ALABAMA
Children First Program
HB 92 (enrolled version)
Status: signed into law as 98-382

    This Act establishes the Children First Trust Fund within the State Treasury, contingent upon the receipt of tobacco revenues, as defined, and provides for the management and administration of the fund by the Alabama Juvenile Justice Coordinating Council. The Act appropriates the fund for allocations to the Department of Public Health, the State Board of Education, the Department of Human Resources, the Children's Trust Fund, the State Multiple Needs Children's Fund, the Department of Mental Health and Mental Retardation, the Administrative Office of Courts, the Department of Youth Services, the Department of Public Safety, the Alcoholic Beverage Control Board, and the Department of Forensic Sciences. The Act provides for oversight by the Permanent Joint Legislative Oversight Committee of the Children First Trust Fund.
    This Act creates and continuously appropriates the Children First Trust Fund within the State Treasury, under the management, administration, and oversight of the Alabama Juvenile Justice Coordinating Council and the permanent Joint Legislative Oversight Committee of the Children First Trust Fund, to provide allocations for prevention, treatment, education, rehabilitation, and punishment programs for children.
    The fund would consist of revenues received from additional taxes levied on tobacco products pursuant to an unspecified Act of the 1998 Regular Session.
    This Act annually allocates 21 percent of the fund to the Department of Public Health for the Children's Health Insurance Program and for education programs for tobacco control among children.
    This legislation annually allocates 20 percent of the fund to the State Board of Education for the operation of alternative schools and for the administration of the School Safety Enhancement Program. Each local board of education would be required to submit an alternative school plan to the State Board of Education. The State Board of Education would review the local programs and submit an annual report regarding the effectiveness of the programs to the council.
    The law annually allocates 18 percent of the fund to the Alabama Department of Human Resources for distribution to increase foster care basic monthly maintenance rates, to Alabama Child Care Management Agencies to fund certain child care programs, to provide funds for adoption assistance, to increase basic rates and fund services through licensed shelter care and residential foster homes, and to recruit and maintain additional therapeutic foster homes.
    This Act annually allocates 4 percent of the fund to the Children's Trust Fund for distribution to fund grants for programs of home visitation for prevention of abuse and neglect of newborn infants until they reach school age and to fund grants for certain other community-based programs.
    This law annually allocates 4 percent of the fund to the State Multiple Needs Children's Fund to be allocated by the Alabama Children's Services Facilitation Team for mental health treatment and other rehabilitation services for multiple needs children.
    The Act annually allocates 2 percent of the fund to the Alabama Department of Mental Health and Mental Retardation to provide services to children and families in crisis.
    This Act annually allocates 8 percent of the fund to the Administrative Office of Courts to unify and upgrade the juvenile justice system and improve the delivery of services to children who have been referred to the juvenile court by converting certain juvenile probation officers and support staff to state employee status pursuant to the Juvenile Probation Services Improvement Act, and would further provide additional juvenile probation officer positions. This law requires an annual report to be filed jointly by each presiding juvenile judge and chief probation officer regarding the services provided by the juvenile probation staff to the children under their supervision with the Administrative Office of Courts.
    This law annually allocates 15 percent of the fund to the Department of Youth Services to fund secure beds, community-based alternatives to commitment, including boot camps, wilderness programs and detention subsidies, and would provide for an annual accounting of the distribution of funds to be filed with the council.
    The legislation annually allocates 5 percent of the fund to the permanent Joint Legislative Oversight Committee on Community Services Grants for the awarding of Alabama community service grants to each Senate and House district for use in identified Children First programs.
    This Act annually allocates 1 percent of the fund to the Alcoholic Beverage Control Board for youth access enforcement.
    This Act annually allocates 2 percent of the fund to the Office of Prosecution Services, to fund juvenile court prosecutors.

KANSAS
Endowment for Youth Fund
Senate Substitute for HB 2558
Status: enacted into law in May 1999.

    This Act establishes in the state treasury the Kansas endowment for youth fund which shall constitute a trust fund and shall be invested, managed and administered in accordance with the provisions of this Act by the board of trustees of the Kansas public employees retirement system.
    The law directs that all of the money received by the state pursuant to the tobacco litigation settlement agreements entered into by the attorney general on behalf of the state of Kansas, or pursuant to any judgment rendered, regarding the litigation against tobacco industry companies and related entities, shall be deposited in the state treasury and credited to the Kansas endowment for youth fund. All such money shall constitute an endowment which shall remain credited to the Kansas endowment for youth fund except as provided in this section or in section 2 and amendments thereto for transfers to the children's initiatives fund. Expenditures may be made from the Kansas endowment for youth fund for the payment of the operating expenses of the Kansas children's cabinet and the board of trustees, including the expenses of investing and managing the money, which are attributable to the Kansas endowment for youth fund.
    The legislation directs that all money credited to the Kansas endowment for youth fund shall be invested to provide an ongoing source of investment earnings available for periodic transfer to the children's initiatives fund in accordance with this Act. All expenditures from the Kansas endowment for youth fund shall be made in accordance with appropriation acts upon warrants of the director of accounts and reports issued pursuant to vouchers approved by the chairperson of the board of trustees of the Kansas public employees retirement system.

NEW YORK
Tobacco Use Prevention and Control Foundation
A 6897
Status: amended and pending in Codes Committee as of 07/20/99.

    This bill establishes a tobacco use prevention and control foundation to serve as an expert, independent entity to undertake, promote and administer programs and activities to prevent tobacco use among young people and to reduce tobacco use among all populations as rapidly as possible.

OREGON
Recruiting and Training Faculty
S 1105
Status: pending in Ways and Means Committee as of 07/20/99.

    This bill directs the Oregon Health Sciences University Board of Directors to enter into an agreement with a community foundation to create an Oregon Health Sciences University Intellectual Capital Fund. It specifies that fund may be used for recruiting and retaining faculty who conduct research in specified areas. It transfers interest on money received by state from Master Settlement Agreement of 1998 to Oregon Health Sciences University public corporation.

PENNSYLVANIA
Special Education, Recreation Trails and Cancer Research
HB 1326
Status: pending in House Appropriations Committee as of 07/20/99.

    This bill requires that the General Assembly appropriate a third of the tobacco settlement money for for school funding for special education reimbursement, a third for Open Space and Greenway Trails, and a third to cancer research facilities and substance abuse treatment facilities.

SOUTH CAROLINA
Youth Smoking Prevention Fund
SB 894
Status: pending in Senate Medical Affairs Committee as of of 07/20/99. This bill will probably carry over into the second part of the current legislative session, which will reconvene in January 2000.

    This legislation allocates a percentage of the money the state will receive under the Master Settlement Agreement to fund youth smoking prevention efforts. It establishes a grant program to be administered by an independent Youth Smoking Prevention Commission to fund such prevention efforts, including anti-smoking media campaigns directed at youth, school and community-based youth education and development programs, and increased enforcement and education of youth access laws.
    The bill provides that a Commission must develop a State Plan for Youth Smoking Prevention to include criteria for evaluating grant requests as well as identifying the types of programs eligible for funding. Such programs, at a minimum, include the 4 prevention efforts mentioned above. The bill requires funding for an annual statewide student-based survey to measure cigarette use and behaviors towards cigarette use by students. In addition, reports by grantees and the Commission must be provided for ongoing monitoring and evaluation of the success of the program.

VIRGINIA
Secondhand Smoke
HB 2631
Status: died in committee.

    This bill requires any public or private entity utilizing any money received by the Commonwealth pursuant to the settlement agreement with tobacco product manufacturers, as a condition to receiving such funds, to establish and maintain policies to support the reduction of tobacco use and reduce exposure to secondhand smoke. It declares that the state board of health shall establish criteria for determining whether an entity's policies support the reduction of tobacco use and reduce exposure to secondhand smoke and monitor the distribution of such money to ensure that the recipients of such funds are in compliance with the provisions of this section.

WASHINGTON
Tobacco Prevention and Control
Senate Substitute Bill 5516
Status: passed Senate in March 1999.  Returned to Senate Rules in April 1999. This bill will carry over to the 2000 session.

    This bill creates a Tobacco Prevention and Control Program within the state department of health. The program is administered in consultation with a Tobacco Prevention and Control Advisory Board consisting of 18 members including: the Attorney General, two members from the House of Representatives and two members from Senate, one member from the Governor's policy staff, two members representing populations at risk for tobacco use, three members of a nongovernmental tobacco control group, a tribal representative, two members under age 18, two members from the local public health community, one representative from the Department of Health and a designee from the Office of the Superintendent of Public Instruction.
    The department must develop a sustainable, long-term, comprehensive tobacco control program that integrates public education, cessation, school and community programs, enforcement measures against illegal tobacco sales and a mechanism for ongoing monitoring and evaluation.
    The department must conduct an inventory of current programs, use the public health system, conduct research on programs elsewhere with high success rates and include long-term outcome measures. The department must develop a plan to increase access to smoking cessation programs for high-risk groups, including pregnant women and adults. The department must develop a plan for reducing access to tobacco products on Indian reservations.
    The department must report back to the Legislature by December 1, 1999, on the initial phase of the plan with projected expenditures through June 30, 2001. A second report is due on September 30, 2000, with long range plan and expenditures for tobacco control. The Tobacco Prevention and Control Advisory Board is directed to assist the secretary in developing, selecting and evaluating strategies for tobacco prevention and control efforts that are administered by the program. The Attorney General or designee serves as chair of the board for the initial two-year term. Thereafter the board selects a chair from among its members.

HEALTH CARE (GENERAL)

ARKANSAS
School Nurses
SB 750
Status: died in committee.

    This bill directs that money from a Tobacco Settlement Trust fund can be used for grants to schools to provide school nurses to meet the nurse to student ratio of the Department of Education.

LOUISIANA
Pharmacy Access Fund
HB 898
Status: died in committee in May 1999.

    Present law creates the Children's Health Insurance Program Support Fund and provides for the disposition of any money received by the state as a result of any Act of Congress implementing a tobacco industry settlement, or as a result of any settlement or judgment related to same. It provides for the use of up to $10,000,000 per year of such money to the degree to which the funds are allowed under the Act of Congress, agreement, judgment or settlement to be used to support health insurance coverage for children. It provides that such funds used to support health insurance coverage for children will be deposited by the treasurer into the Children's Health Insurance Program Support Fund.
    This proposed law retains present law and creates the "Pharmacy Access Fund," hereinafter the "fund," as a special fund within the state treasury. It provides that the source of money in the fund shall be money received by the state as a result of the Master Settlement Agreement (tobacco settlement). It requires that $25,000,000 of such tobacco settlement money remaining each year after the required deposit of money into the Bond Security and Redemption Fund and the Children's Health Insurance Program Support Fund (R.S. 46:977) be deposited into the Pharmacy Access Fund.
    The proposed law provides that money in the fund are available for appropriation by the Legislature exclusively for the support and provision of outpatient pharmacy services for indigent or needy citizens of Louisiana through the institutions of the healthcare services division of the Louisiana State University Medical Center. It further provides that any money remaining in the fund at the end of the fiscal year shall remain in the fund. Money in the fund shall be invested by the treasurer in the same manner as the money in the state general fund and interest earned shall be credited to the fund.
    The proposed law authorizes the chancellor of the health care services division of the Louisiana State University Medical Center to set the eligibility criteria for participation in the pharmacy program supported by the fund.

LOUISIANA
Rural Health Care Initiatives
SB 374
Status: died in committee in May 1999.

    Present law requires the Department of Health and Hospitals (DHH) to establish primary health care clinics in each of the rural parishes throughout the state upon the availability of 100 percent federal funds and to promulgate rules to implement present law in accordance with the APA.
    Proposed law requires the establishment of pilot programs of rural primary health care clinics, rural health care initiatives, and health initiatives in medically under-served areas from a portion of money received by the state each year from the tobacco settlement.
    Effective upon signature of the governor or lapse of time for gubernatorial action, but not until the passage of a constitutional amendment authorizing the expenditure of tobacco settlement fund for use in rural health care initiative and medically under-served areas.
    A committee amendment changes the bill’s purpose from establishing primary health care clinics in rural parishes to establishing pilot programs of rural primary health care clinics, rural health care initiatives and health initiatives in medically under-served areas.

LOUISIANA
Smoke-free Health Fund
HB 362
Status: died in committee in May 1999.

    This proposed constitutional amendment provides for establishment of the Tobacco Settlement Trust Fund, (Trust Fund), as a special permanent trust fund in the state treasury, as well as the Louisiana Smoke-free Health Fund, (Health Fund), as a special fund in the state treasury.
    The constitutional amendment provides that the source of money deposited into these funds shall be money received by the state from the Master Settlement Agreement executed November 23, 1998, and approved by Consent Decree and Final Judgment entered in the case Richard P. Ieyoub v. Philip Morris, Incorporated, et al., No. 98-6473 on the docket of the 14^th Judicial District for the Parish of Calcasieu, State of Louisiana, (Settlement Agreement). It provides that after allocation of money received from the Settlement Agreement to the Bond Security and Redemption Fund, the treasurer shall deposit in and credit to the Trust Fund 25 percent of such settlement proceeds, with the remaining 75 percent of settlement proceeds being deposited in and credited to the Health Fund. This allocation of Settlement Agreement proceeds may only be changed by law enacted by two-thirds vote of each house of the Legislature.
    The amendment provides that dividend income, interest earnings, and realized capital gains associated with investment of the Trust Fund and the Health Fund shall be deposited in and credited to the respective funds. Once the balance of the Trust Fund reaches $2 billion, then future Settlement Agreement proceeds will cease to be deposited into the Trust Fund, and will instead be deposited into and credited to the state general fund, with dividend and interest income and realized capital gains on investment of the Trust Fund credited to the Health Fund. The state treasurer is required to invest the money in the Trust Fund, up to 35 percent of which may be invested in stock and procedures for investment of both funds shall be provided by law.
    This proposed constitutional amendment prohibits appropriation from the Trust Fund. Appropriations from the Health Fund may be made for expenses incurred in the investment and management of the Trust Fund and money available in the Health Fund may be appropriated annually for the following purposes:
    (1) No more than 60 percent for the provision of grants for research by Louisiana universities for research centered on cancer, genetics, and public health and for the direct provision of treatment for citizens with tobacco-related illnesses.
    (2) No more than 30 percent for the direct provision of health care and health services for children.
    (3) No more than 10 percent for support of educational efforts for prevention of tobacco usage by children and for enforcement of laws relating to the sale and usage of tobacco products.
    It prohibits money appropriated from the Health Fund from being used in displacing, replacing, or supplanting appropriations from the state general fund for any of these specified purposes or activities.
    The proposed amendment would be submitted to the voters at the gubernatorial primary election in 1999.

MINNESOTA
Tobacco Prevention, and Local Public Health Endowment, Medical Education Minnesota Endowment Article 11, Chapter 245 of the 1999 Omnibus Health & Human Services Bill
Status: signed into law on May 25, 1999.

    Article 11 of the 1999 Omnibus Health & Human Services Act sets aside $968 million in tobacco settlement proceeds Minnesota will receive by 2001 and creates two endowments. Interest earned from the endowments, up to 5 percent, will be available for tobacco prevention and other vital public health efforts. The principal is left untouched.
    The larger endowment - Tobacco Prevention and Local Public Health Endowment - will be funded with $590 million, or 61 percent of the total available. Of this, interest earnings from $395 million, projected to be approximately $20 million per year by 2003, will go for statewide tobacco prevention initiatives directed at youth. Local Public Health is funded at $195 million. Interest earnings from this amount, projected to be approximately $10 million per year, will be divided evenly between: local prevention efforts focusing on tobacco in conjunction with other high-risk behaviors facing youth; and grants to community health boards for youth health promotion and prevention activities which are non-tobacco related.
    The Medical Education Endowment is funded with the remaining $378 million, or 39 percent of the total. A portion of the interest earned will be used to help fund the clinical training of medical health professionals at clinical sites throughout the state. The remaining interest earnings will be used to help fund the University of Minnesota’s Academic Health Center, which includes colleges and schools in the fields of medicine, nursing, dentistry, pharmacy and public health, as well as the School of Medicine in Duluth.

MISSISSIPPI
Health Care Trust Fund
HB 519
Status: enacted into law in April 1999.

    This Act establishes a health care trust fund in the state treasury into which shall be deposited the funds from the settlement of the lawsuit against tobacco companies by the state of Mississippi, including income from the investment of those funds. It provides that the trust fund shall remain inviolate and shall never be expended, with certain exceptions.
    This law establishes a health care expendable fund in the state treasury into which shall be transferred annually certain money in the health care trust fund and provides that the funds in the health care expendable fund shall be expended exclusively for health care purposes.
    The law establishes a board of directors to invest the funds in the health care trust fund and the health care expendable fund; provides for the membership of the board and prescribe its powers and duties.
    This Act also provides that the board shall invest the funds in the health care trust fund and the health care expendable fund in any of the investments authorized for the Mississippi prepaid affordable college tuition program.

MISSOURI
Basic Breathing Screening
HB 1029
Status: bill died in committee in April 1999.

    This bill directs that beginning January 1, 2001, and ending June 1, 2004, school boards are required to provide a free, basic breathing screening by a qualified health care provider for each second- and sixth-grader and to report the results to the child's parents. School boards are also required annually to report to the state department of health the number of students screened and the number of referrals for examination by a physician that resulted from the screening. The department will present this information to the General Assembly in January 2004. The screening will be funded by tobacco settlement money.

NEBRASKA
Excellence in Health Care Trust
LB 324
Status: enacted into law in April 1999.

    This Act amends state law to create The Nebraska Tobacco Settlement Trust Fund.
    The fund shall include revenue received from a settlement or judgment awarded to the State of Nebraska as a result of tobacco-related litigation for compensation for the costs of treating smoking-related illnesses. The Department of Health and Human Services Finance and Support shall remit such revenue to the State Treasurer for credit to the fund. Subject to the terms and conditions of the settlement or judgment, the interest investment income on the revenue shall be transferred to the Excellence in Health Care Trust Fund to be used for grants or loan guarantees.
    The law directs that any money in the Nebraska Tobacco Settlement Trust Fund available for investment shall be invested by the state investment officer pursuant to the Nebraska Capital Expansion.
    It directs that:
    (1) The Department of Health and Human Services Finance and Support shall administer the distribution of the money in the Nebraska Health Care Trust Fund as provided in this section.
    (2) The department shall:
        (a) Direct the State Treasurer to transfer the first forty million dollars placed in the fund, plus interest the investment income accruing prior to the transfer, to the Nursing Facility Conversion Cash Fund;
        (b) Direct the State Treasurer to transfer the next twenty-five million dollars placed in the Nebraska Health Care Trust Fund, plus interest investment income accruing prior to the transfer, to the Children's Health Insurance Cash Fund; and
        (c) Beginning January 15, 1999, direct the treasurer to transfer only the interest investment income accruing on the money in the Nebraska Health Care Trust Fund in excess of the first sixty-five million dollars placed in the fund to the Excellence in Health Care Trust Fund.
    (3) If there is an unanticipated reduction in federal Medicaid funds pursuant to the generation of revenue from governmental nursing facilities, the department may use money placed in the Nebraska Health Care Trust Fund for Medicaid expenses where the unanticipated reduction occurred.
    The Act directs that:
    (1) Beginning January 15, 1999, the Excellence in Health Care Trust Fund shall be used for:
        (a) awarding grants or making loan guarantees for conversion of nursing facilities to assisted-living facilities or other alternatives to nursing facility care,
        (b) awarding grants for public health services which focus on health education, preventive health measures, and environmental health, assessment, and assurance, including services for reservation or service areas of federally recognized Native American tribes in Nebraska and organizations that focus on the health of minority groups,
        (c) awarding grants for activities related to the design, maintenance, or enhancement of the statewide trauma system, support of emergency medical services programs, and support for the emergency medical services programs for children,
        (d) awarding grants for conversion of hospitals in rural areas of the state to limited-service rural hospitals,
        (e) awarding grants for education, recruitment, and retention of primary care professionals, behavioral health professionals, and nurses for medically under-served areas,
        (f) awarding grants for health infrastructure development which is supportive of telemedicine capability, including, but not limited to, high-speed data and medical information transmission,
        (g) awarding grants for the development and expansion of community-based aging services designed to promote the independent living status of and delay institutional care for elderly people, including, but not limited to, personal care, respite care, homemaker care, and chore and transportation services, and
        (h) the state's matching share for children's health insurance under Title XXI of the federal Social Security Act in excess of the funds.
    The law directs that no more than one-half of the money in the Excellence in Health Care Trust Fund may be used for conversion projects and no funds shall be used for abortion, abortion counseling, referral for abortion or school-based health clinics.

NEW JERSEY
Hospital Charity Care Subsidy Payments
SB 1839
Status: pending in Senate Health Committee. The legislature will reconvene in the Fall of 1999.

    This bill establishes the "New Jersey Tobacco Settlement Trust Fund" as the depository for money received by New Jersey under the nationwide tobacco settlement of November 23, 1998. The money in this trust fund are to be dedicated to health-related purposes, and shall be expended only upon appropriation by the Legislature for these purposes.
    The bill specifies that the money in the trust fund shall be annually appropriated by the Legislature, from the balance in the trust fund as of June 30 of each year, to the Health Care Subsidy Fund and used to fund hospital charity care subsidy payments in an amount which, when added to the annual sum allocated for charity care subsidies pursuant to N.J.S.A.26:2H-18.59 (i.e., currently $320 million), shall be sufficient to cover all of the documented hospital charity care costs reported to the Department of Health and Senior Services for the preceding fiscal year, or the entire balance in the trust fund as of June 30 of each year, whichever amount is less.

OREGON
Health Programs
HB 2007 (A-Engrossed version)
Status: passed House in June 1999. Senate amended as B-Engrossed and passed that version on July 9, 1999. House did not concur with Senate amendments. Bill was still pending in both House and Senate as of 07/20/99.

    This bill establishes a Health Security Fund consisting of money paid by tobacco products manufacturers under Master Settlement Agreement. It defines health programs to include transportation of elderly and disabled, housing for disabled people and low income families, and certain other programs.

PENNSYLVANIA
Interstate Compact for Cancer Research
HR 188
Status: pending in House Rules Committee as of 07/20/99.

    This resolution recommends that the governor allocate a portion of Pennsylvania's tobacco settlement proceeds to establish and fund a compact with other states for cancer research.

TEXAS
Funds for Education, Children and Public Health and Emergency Medical Texas Services and Trauma
HB 1676
Status: enacted into law in 1999.

    This Act creates a Permanent Fund for Tobacco Education and Enforcement as a dedicated account in the general revenue fund. The fund is composed of:
    (1) money transferred to the fund at the direction of the Legislature;
    (2) gifts and grants contributed to the fund; and
    (3) the available earnings of the fund.
    The available earnings of the fund may be appropriated to the Texas Department of Health for programs to reduce the use of cigarettes and tobacco products in this state, including:
    (1) smoking cessation programs;
    (2) enforcement of laws relating to distribution of cigarettes or tobacco products to minors or use of cigarettes or tobacco products by minors;
    (3) public awareness programs relating to use of cigarettes and tobacco products, including general educational programs and programs directed toward youth; and
    (4) specific programs for communities traditionally targeted, by advertising and other means, by companies that sell cigarettes or tobacco products.
    The legislation enables the state department of health to contract with another entity to perform all or a part of the functions described above or to award grants to community organizations, public institutions of higher education or political subdivisions to enable the organizations, institutions or political subdivisions to perform all or a part of those functions.
    To ensure the most efficient, effective and rapid delivery of services, the state board of health shall give high priority and preference to existing, effective state programs that do not otherwise receive money from an endowment program funded by money received under the Comprehensive Settlement Agreement and Release filed in the case styled The State of Texas v. The American Tobacco Co., et al., No. 5-96CV-91, in the United States District Court, 2-23 Eastern District of Texas.
    The Act creates a Permanent Fund for Children and Public Health as a dedicated account in the general revenue fund to the Texas Department of Health for the purpose of developing and for improving health outcomes for children and the public and for providing grants to local communities to address specific public health priorities, including sickle cell anemia, diabetes, high blood pressure, cancer, heart attack, stroke, keloid tissue and scarring, and respiratory disease and for providing grants to local communities for essential public health services as defined in state law.
    This legislation establishes a Permanent Fund for Emergency Medical Services and Trauma Care. The Texas Department of Health may establish programs to provide emergency medical services and trauma care in this state, may contract with another entity to establish those programs, or may award grants to political subdivisions to establish or support those programs. The department may consolidate any grant program established under this section with other grant programs relating to the provision of emergency medical services and trauma care.
    Money from this fund and the aforementioned Children and Public Health Fund may also be appropriated to pay any amount of money that the federal government determines that the state should repay to the federal government or that the federal government should recoup from the state in the event of national legislation regarding the subject matter of the case styled The State of Texas v. The American Tobacco Co., et al., No. 5-96CV-91, in the United States District Court, Eastern District of Texas.

WASHINGTON
Emergency Medical Services
SB 5755
Status: left in Senate Ways & Means Committee in April 1999. This bill will carry over to the 2000 session.

    This bill creates the emergency medical services assistance account in the state treasury. Into this account shall be placed all money received by the state under the settlement of the state's legal action against tobacco product manufacturers, exclusive of costs and attorneys' fees. On the first day of the months of January, April, July and October of each year, the state treasurer shall distribute the funds in the emergency medical services assistance account to the counties on the basis of population as last determined by the office of financial management.
    Provides that funds distributed from the emergency medical services assistance account under this Act shall be used only for the provision of emergency medical care or emergency medical services, including related personnel costs, training for such personnel, and related equipment, supplies, vehicles and structures needed for the provision of emergency medical care or emergency medical services, or for distribution by the county to emergency medical service districts, cities or towns, public hospital districts, urban emergency medical service districts or fire protection districts within the county for the provision of emergency medical care or emergency medical services.

HEALTH INSURANCE

CALIFORNIA
Fund for Medically Uninsured and Under-served People
AB 887
Status: pending in Assembly committee as of 07/21/99.

    This bill would create the Access to Health Care Services Fund in the State Treasury as a repository of a portion of the revenue received by the state from a federal tobacco settlement. The money in the fund would be continuously appropriated to the State Department of Health Services for purposes of providing health services to medically uninsured and under-served people in California; and reimbursing primary care clinics certified by the State Department of Health Services.

CONNECTICUT
Connecticut Health Care Insurance Act
Substitute HB 7030
Status: died on House calendar.

    This bill establishes the Connecticut Health Care Trust (the "Trust") to provide health care, including long-term care, for eligible state residents. A resident and his dependents are eligible if he has lived in the state for at least one year and he, or his employer, has paid all required taxes. The bill creates new health care payroll and income taxes. It also creates the Connecticut Health Care Trust Fund (the "fund") to pay for health care services and other specified items.
    The bill places the Trust in the Department of Social Services (DSS) for administrative purposes only. It (1) specifies the Trust's powers and responsibilities; (2) establishes a board of trustees to govern it; (3) requires the board to appoint an executive director; (4) establishes four divisions [planning, development, and research; consumer; benefits; and quality control); and (5) establishes three statewide advisory councils (consumer, professional and health care organizations (HCOs)].
    Under the bill, an individual and his dependents are eligible for health benefits if: (1) he has resided in Connecticut for at least one year, (2) his employer has paid its required payroll taxes for him for at least six months, and (3) he has paid any required self-employment health care taxes for at least six months.
    The bill makes a state resident and his dependents of at least two years eligible for long-term care (a term that the bill does not define) if he is able to show that: (1) he has been employed full-time for two years (or part-time for more than two years) by an employer that has paid all required payroll taxes; (2) he has lived in the state and paid all required payroll and income taxes for at least two years; or (3) he is eligible for long-term care under Medicaid or Medicare, or any other federal law.
    The bill specifies that individuals who are not eligible for long-term care under its provisions may still be eligible for care to the same extent that they would have been before its enactment.
    The bill establishes a Connecticut Health Care Trust Fund. Apparently, the fund will be within the Trust. It must be funded with state funds currently spent on health care through the Medicaid program, indigent care payments and state health care-related administrative costs; taxes imposed on items that contribute to increased health care costs; employer, family, and individual taxes; grants; donations, gifts, and bequests; rebates; fund investment income; any remaining state tobacco settlement funds; and General Assembly appropriations.
    The bill requires the Trust to maximize all federal funding sources for health care services. The executive director must obtain any needed waivers, exemptions or legislation so that all current federal payments for health care, including Medicare, are paid directly to the fund. (Medicare is a purely federal program that makes payments to providers, hospitals and individuals. The state receives no payments under it.)
    The bill requires the state to pay the fund the amount it currently pays for health care services and administrative functions that the Trust assumes under the bill. It specifies that the cost is annually altered through negotiations between the executive director, the director of the budget (although the bill does not identify who this is), and the General Assembly.
    The bill requires surtaxes to be imposed on tobacco products, alcohol, gasoline and facilities operating within the state that generate air or water pollution (the bill does not define what levels constitute air or water pollution). The General Assembly must determine taxes, in conjunction with the executive Trust's director. The identified items may be taxed to the extent that they can reasonably be determined to contribute to health care costs.
    The bill requires all employers to pay premiums, in the form of a health care payroll tax. Taxes begin with the enactment of the Trust's benefit plan. Presumably the Department of Revenue Services (DRS) determines when the enactment begins. Premiums must be similar to, or less than, the average contributions that employers make toward their employees' health benefits as of the bill's effective date, but must be adjusted to a rate less than the national health care inflation or deflation.
    Families or individuals receiving benefits must pay premiums collected through the state income tax and the tax amount must be determined on a sliding scale basis as determined by the Trust in consultation with the DSS. However, families and individuals earning less than 185 percent of the federal poverty level do not pay health care income or payroll taxes.
    Workers' premiums must be less than the amount they would pay through an employer or private insurance plan for comparable benefits. Medicare-eligible individuals' premiums must be less than the cost of private insurance for non-Medicare covered services.

ILLINOIS
Health Care Benefits for the Uninsured
HB 234
Status: did not pass the Legislature in 1999.

    This bill creates the Tobacco Litigation Settlement Distribution Act and the Tobacco Litigation Settlement Distribution Fund. It provides that all unrestricted proceeds received by the state under the tobacco litigation settlement agreement shall be deposited into the Tobacco Litigation Settlement Distribution Fund.
    The bill requires all unrestricted proceeds to be used for public health purposes, and requires that at least 90 percent of the unrestricted proceeds be used to provide health care services or health care benefit coverage to people in the State who do not have health insurance or other health care benefit coverage.
    It provides that restricted proceeds received under the settlement shall be placed in separate special funds and used only for the purposes specified in the settlement agreement.

LOCAL GOVERNMENT

CALIFORNIA
Tobacco Settlement Fund Allocations to Local Governments
AB 112
Status: passed Assembly and pending in Senate Health and Human Services Committee as of 07/21/99.

    Existing state law:
    (1) Provides that in the matter of the coordinated Tobacco Cases, the parties reached a settlement through a memorandum of understanding that allocates 50 percent of the California share of the recovery to California cities and counties.
    (2) Allows counties to finance construction projects through issuance of "certificates of participation" or "lease revenue bonds."
    (3) Provides that if the county fails to make payment on such debt, for any reason, payment in the amount required shall be made from Vehicle License Fees.
    This bill provides that tobacco settlement money allocated to cities and counties shall be available to cities and counties for any purpose. Specifically, this bill:
    (1) Provides that the entire amount of the money allocated to cities and counties pursuant to the memorandum of understanding from settlement of the coordinated tobacco litigation shall be available to cities and counties for any purpose.
    (2) Allows the governing body of a city, county, or city and county to, by resolution, deposit tobacco settlement money into a State Treasury special Tobacco Litigation Settlement Fund for the following uses:
        a. The principal and interest from the fund shall be available to cities and counties to guarantee payment for financing capital improvement projects.
        b. Security for certificates of participation for local capital projects.
    The bill essentially gives local government unfettered discretion over the use of funds received under the settlement of the tobacco litigation.

MASTER SETTLEMENT AGREEMENT

CALIFORNIA
Sanctions for Manufacturers that Do Not Participate in the Tobacco Master Settlement Agreement SB
SB 822
Status: passed Senate. Pending in Assembly Appropriations Committee as of 07/21/99.

    Existing law provides for various programs for the reduction in the inappropriate use of cigarettes and tobacco products.
    Under existing law, certain tobacco product manufacturers have entered into an agreement with the federal government and participating states regarding the allocation of funds on the basis of tobacco products sold within each state.
    This bill would specify that any tobacco product manufacturer selling cigarettes to consumers within the state shall either become a participating manufacturer under the terms of the settlement agreement entered into by the states and certain tobacco manufacturers and perform its financial obligations under the settlement, or place an amount of funds, calculated on the basis of units of tobacco products sold, into an escrow fund.
    The bill specifies that the funds in the escrow fund shall be used to pay a judgment or settlement on any released claim against the tobacco product manufacturer by the state or be released to the tobacco product manufacturer in certain circumstances. The bill would authorize the Attorney General to bring a civil action on behalf of the state against any tobacco product manufacturer that fails to place the funds into escrow, and would specify penalties for any knowing violation of the requirement to place the funds into escrow.

IDAHO
Implementing the Tobacco Settlement Master Agreement
HB 82
Status: enacted as Chapter 7, Laws of 1999.

    This Act adds to existing law to implement the Tobacco Settlement Master Agreement regarding litigation between various states and the major tobacco companies so that Idaho can receive funding from the settlement.
    On November 23, 1998, Idaho entered into a historic settlement agreement with leading United States tobacco manufacturing companies. The agreement requires these manufacturers, in part, to pay substantial sums of money to the State of Idaho and to make substantial changes in their advertising and marketing practices and corporate culture, with the intention of reducing underage smoking. It would be contrary to the policy of the State of Idaho if tobacco manufacturers who determine not to enter into such a settlement could use a resulting cost advantage to derive large, short-term profits in the years before liability may arise without ensuring that the State will have an eventual source of recovery from them if they are proven to have acted culpably. It is thus in the interest of the State of Idaho to require that such manufacturers establish a reserve fund to guarantee a source of compensation and to prevent them from deriving large, short term profits and then becoming judgment-proof before liability may arise.
    This legislation addresses that concern by requiring tobacco product manufacturers to either become a participating manufacturer under the November 23, 1998, settlement agreement or annually contribute into a qualified escrow account an amount of money based upon cigarette sales for the previous year. The qualified escrow account shall be at the manufacturer's selection. Money in the account not released to satisfy a judgment obtained against the manufacturer shall revert back to the manufacturer 25 years after it was first deposited.

UTAH
Tobacco Manufacturers Responsibility Act
HB 132
Status: enacted into law in 1999.

    This Act enacts the model tobacco settlement statute to protect the state against a potential reduction in tobacco settlement money as a result of a decline in the market share of settling tobacco manufacturers.

MENTAL HEALTH

PENNSYLVANIA
Treatment for Mental Disabilities
HB 1481
Status: pending in House Appropriations Committee as of 07/20/99.

    This bill directs that 25 percent of the tobacco litigation master settlement agreement funds are to be utilized for salaries of direct care staff who work with people who are diagnosed with mental disabilities in community-based mental health/mental retardation programs.

RHODE ISLAND
Community Mental Health Centers
H 6215
Status: died in House Finance Committee in April 1999.

    This act appropriates two million dollars ($2,000,000) annually to the eight Rhode Island community mental health centers out of funds available under the master settlement agreement with participating tobacco manufacturers.

MISCELLANEOUS

CALIFORNIA
Retrofitting Hospitals to Meet Seismic Safety Standards
AB 1227
Status: pending in Assembly Appropriations Committee as of 07/21/99.

    Under existing law, the Office of Statewide Health Planning and Development is responsible for reviewing and approving seismic evaluation reports, compliance schedules and construction documents that are developed by hospital owners and for the field review of construction for work done for purposes of seismic safety in hospitals. Existing law requires the office to develop regulations as they apply to the administration of seismic standards for retrofit designs, construction and field reviews for the purposes of provisions governing seismic safety in hospitals.
    Existing law requires the California Building Standards Commission to adopt seismic