Foes fight diversion of Ohio tobacco settlement

5/17/2007

COLUMBUS - As black-robed Grim Reapers circled, more than 100 activists rallied at the Statehouse yesterday to protest Ohio's plan to entirely trade the state's settlement with tobacco companies for school construction and tax relief.

Critics argued that the state is wrong if it thinks Ohio's new ban on smoking in indoor public places has solved the problem of Ohio's high smoking rates.

"The tobacco problem in Ohio is not a dead issue. Tobacco is a death issue,'' read T-shirts worn by the crowd.

Gov. Ted Strickland has proposed, and the Ohio House has ratified, a plan to sell off 40 years of settlement payments to investors for an up-front lump sum of $5 billion without earmarking a penny for smoking prevention and cessation programs. The state plans to use the money to accelerate its school construction program and to use the savings from not having to borrow money for that purpose as previously expected to underwrite a massive local property tax cut for all senior citizen and disabled homeowners.

In the Senate, however, there is some talk about limiting the homestead exemption to homes valued at $250,000 or less. Another idea is to earmark any excess dollars to anti-smoking programs if the state should attract more than $5 billion from the tobacco securitization plan.

The state currently receives about $300 million a year from the settlement with major tobacco companies like Philip Morris and R.J. Reynolds.

Kathryn Grayson, of Urban Minority Alcoholism Drug Abuse Outreach Programs of Lucas County, said she was alarmed to see her 8-year-old granddaughter pick up a cigarette to emulate her father, and fears there won't be smoking cessation programs to help her from the Ohio Tobacco Prevention Foundation if future scheduled payments from the tobacco settlement are cut off. The foundation, whose most visible program is its "stand'' youth marketing campaign, estimates it will run out of money in less than 10 years.

"One of the myths out here is that, with the Smoke-Free Ohio law, people will quit smoking,'' she said. "It's just one of the puzzle pieces to help people begin to quit. To change the norms, the beliefs of society, that takes longer than 10 years.''

House Speaker Jon Husted (R., Kettering) said he would welcome the chance to revisit securitization, including the question of whether the homestead exemption should go to the wealthiest of homeowners. But he talked about investing the savings in higher education and treatment of smoking-related problems rather than more public awareness programs.

"A lot's changed since [the foundation was] created,'' he said. "We now have a statewide smoking ban. There are very few places where one can smoke, and I think the environment's changed.''

The foundation originally planned to live off investment earnings, but that was when the foundation expected to have about $1 billion in the bank. Lawmakers diverted hundreds of millions, leaving the foundation with a current bank account of $300 million.