Foundation tries to block seizure of Ohio tobacco funds

6/3/2008

COLUMBUS - A $230 million hole remains in Ohio's just-passed $1.57 billion economic stimulus package, and a Washington-based foundation was in court yesterday fighting to keep the state from plugging it with tobacco prevention funds.

At issue is whether the American Legacy Foundation entered into a binding contract for a $190 million grant from the Ohio Tobacco Prevention Foundation before Gov. Ted Strickland signed a law confiscating $230 million in state foundation money.

"I knew literally tens of thousands of lives were on the line," testified Dr. Robert Crane, a family physician and anti-tobacco activist from Columbus who served on the board of trustees of the now defunct state foundation. He voted with most board members to fight back by transferring $190 million from its endowment before the state could get to it.

Mr. Strickland and the General Assembly later responded by putting the legislatively created state foundation out of business, an act that Dr. Crane referred to as "kill the plaintiff."

Judge David W. Fais of Franklin County Common Pleas Court is considering whether to make permanent his temporary restraining order preventing the state from spending the $230 million.

One of the plaintiffs in the case is Robert G. Miller, Jr., 50, of Toledo, who quit smoking after several tries with help from a state foundation-funded program at St. Luke's Hospital. He is expected to testify today when the hearing continues.

The state argues that the trustees illegally met behind closed doors to discuss the contract, a violation of Ohio's open meetings law that it contends would void any agreement that followed.

The Ohio Tobacco Prevention Foundation was created in 2000, using early payments from the state's share of a multistate settlement with tobacco companies like Philip Morris and R.J. Reynolds.

But the cash-strapped state soon began redirecting annual settlement checks to other purposes before the money could reach the foundation.

Mr. Strickland and Republican legislative leaders announced a $1.57 billion jobs package on April 2 that partly relies on $230 million of foundation funds, marking the first time the state has gone after money already in the foundation's trust.

The jobs package passed the House and Senate and is awaiting the governor's signature, despite the huge question mark concerning 15 percent of its funding.

The confiscation of funds would have left the foundation with just $40 million, less than its annual budget at the time to run its "stand" anti-smoking program targeting youth and its Ohio Quits hot line.

Now that the rebellious state foundation has been killed, the $40 million not frozen by the court's order has been transferred to the Department of Health to continue the foundation's anti-smoking programs on a much smaller scale.

David W. Weinmann, 31, of Cleveland, another plaintiff in the case, testified that a program funded by a foundation grant helped him kick the smoking habit after he discovered he had cancer of the tongue at the age of 29.

He'd been smoking since he was 13.

"I believe it saved my life," he said.

Contact Jim Provance at:

jprovance@theblade.com,

or 614-221-0496.