Tobacco Facts.

State lawmakers said Thursday they want to look at changing a law voters approved spelling out how Arkansas should spend the millions of dollars it receives from a national settlement with tobacco companies.

Members of a legislative panel reviewing how the state has spent the $446 million it has received so far said changes may need to be made to the law voters approved in 2000.
Lawmakers are considering tapping into the $125 million reserve fund that the commission overseeing the settlement money created in case payments drop off, said Sen. Bill Pritchard, R-Elkins. Pritchard said the money could be used for other health programs, such as substance abuse prevention.

“That’s a lot of money that’s just sitting there,” Pritchard told reporters after the hearing.

Pritchard says up to 10 hearings on the issue are planned in the coming months. Changing the law would require a two-thirds vote of the House and Senate.

The tobacco industry reached a $206 billion settlement with 46 states, including Arkansas, in 1998 to cover the cost of treating sick smokers.
Arkansas’ share of the 1998 settlement was about $1.6 billion. The state, which distributes the money to several public health programs according to the law, received about $57 million this year from the settlement, said Aaron Black, director of the state’s tobacco settlement commission. The amount varies each year based on sales of tobacco and other factors.

The settlement has been criticized by lawmakers, who question the amount of money going to smoking cessation programs and initiatives such as a quit-smoking hot line that people can call.

Tapping into the trust fund would require the two-thirds vote since it would change an act approved by voters, but Pritchard said the Legislature may be able to change what programs are funded with a smaller majority.

“All of the programs, are we getting the bang for the buck? Do they need to be tweaked? Do they need to be done away with or merged with other programs?” Pritchard said.

Legislators also questioned the commission’s $360,000 annual contract with the RAND Corp. to study the effectiveness of the tobacco funds. RAND has conducted a study every two years for the commission since 2003.

In the past, Rand criticized the Minority Health Commission, which receives about a quarter of its funding from the settlement, for programs that weren’t cost-effective and having too broad of a mission. But in August, RAND said the commission had begun to lower costs and narrow its focus.

“How long, with all the layers of government and the Legislature and the executive branch, are we going to need an outside independent evaluator?” asked Sen. Tracy Steele, D-North Little Rock.

Black said the commission has opposed past proposals to change the act and the trust fund is needed in case of a drop in funding.

“It is there for the potential that if something significant happened that would greatly reduce programs … then the Legislature and governor could look at that trust fund to make ends meet for a while,” Black said.

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