Thursday, October 28, 1999
Taft calls tobacco bill a victory
GOP pitch to fund tax cuts probably dead
BY MICHAEL HAWTHORNE
Enquirer Columbus Bureau
COLUMBUS — Following an appeal from Gov. Bob Taft, a Senate committee voted Wednesday to share Ohio's tobacco settlement with schools, medical research and health programs instead of tax cuts.
The panel abruptly postponed a vote last week after conservative Republicans threatened to derail the GOP governor's plan to spend most of the $10.1 billion in tobacco payments on public schools.
But an amendment that would have diverted some of the money into a fund used for tax cuts never surfaced, and Mr. Taft's aides confidently predicted it won't when the full Senate considers the bill.
While the Taft administration declared victory, the governor didn't get everything he wanted out of the bill. On a party-line vote, the Republican-controlled Senate Finance Committee only specified how half the money should be spent.
Mr. Taft sought a 26-year plan for annual payments from cigarette makers. Despite fierce objections from Democrats, who argued the decision shortchanged programs intended to improve the health of minorities, the committee adopted a 12-year plan.
“We accepted 100 percent of his plan,” said Sen. Roy Ray, an Akron Republican who chairs the Finance Committee. “We just didn't pass it all.”
With a treasure trove of cash up for grabs, Mr. Taft and others with an interest in his plan for the tobacco payments are pushing for a longer, more specific framework for how the money should be spent.
In some respects the debate is meaningless, because lawmakers can't legally tell future General Assemblies how to spend money. But advocates of the governor's plan think it would be difficult to make significant changes if this General Assembly gave its stamp of approval.
Adopting a slimmed down version of the governor's plan, Democrats argued, puts most of the funds devoted to minority health and medical research at risk. The bulk of those funds would have been spent in the later years of Mr. Taft's plan, mirroring increases in the size of annual payments from cigarette makers.
“Every time I smoke I know it's a death wish,” said Sen. C.J. Prentiss, a Cleveland Democrat who chairs the Legislative Black Caucus. “I don't want that to happen to young people in our community.”
Democrats were vocal with their opposition, but advocates of an amendment that would have used some of the tobacco proceeds to grant tax cuts silently accepted their fate — at least for now. Another fight is expected in the House.
The group of conservative Republicans argued that taxpayers deserve the money because states sued the tobacco industry in part to recover money spent to treat smoking-related illnesses.
Seeking to prevent his first major defeat in the General Assembly, Mr. Taft stepped up his lobbying efforts by appearing before a closed-door meeting of Republican senators. He also started making telephone calls to lawmakers asking for their support.
GOP leaders may have persuaded tax cut proponents to back off with figures that suggested the political payoff wouldn't be as attractive as it first appeared.
For instance, if 10 percent of the first settlement check was set aside for tax cuts, a family of four earning $40,000 with two wage earners would have received a tax cut worth $5.62, according to the Ohio Department of Taxation.
If all the money was directed to tax cuts, the same family would have saved $53.45.
Mr. Taft is counting on money from the tobacco settlement to help fund his 12-year, $23 billion plan to fix Ohio's school buildings, which a 1996 federal report determined were the worst in the 50 states.
Using the money for tax cuts instead of schools, he said, would undermine the state's defense of court-ordered changes in the way public schools are funded. The Ohio Supreme Court is scheduled to hear oral arguments Nov. 16 on the state's response to its 1997 ruling that struck down the school-funding system.
Ohio's Catholic bishops, meanwhile, pulled an amendment that would have prevented the use of tobacco funds to fund research into human embryos or cloning. Legislative leaders didn't want the contentious debate about when life begins clouding the tobacco legislation.
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