Wednesday, October 20, 1999
Tobacco payment spending unsettled
GOP senators balk at Gov. Taft's plan
BY MICHAEL HAWTHORNE
Enquirer Columbus Bureau
COLUMBUS — Republican Gov. Bob Taft and Senate Republicans are headed for a showdown over how Ohio should spend its $10.1 billion share of the national tobacco settlement.
With conservative Republicans threatening to derail Mr. Taft's plan to spend most of the money on public schools, Senate GOP leaders abruptly postponed a committee vote Tuesday on legislation that maps out how the windfall should be spent during the next quarter century.
Mr. Taft, seeking to prevent his first major defeat in the General Assembly, stepped up his lobbying efforts by making an unusual appearance before a closed-door meeting of GOP senators. He also started placing calls to individual lawmakers asking for their support.
Both sides described the talks as cordial. But Mr. Taft told lawmakers that choosing to spend the tobacco payments on tax cuts instead of schools, or shrinking the 26-year plan to eight years, could undermine the state's defense of court-ordered changes in the way schools are funded.
“We have an opportunity with these tobacco funds to make permanent, meaningful improvements in the facilities where our children learn,” said Scott Milburn, Mr. Taft's spokesman. “This is very important to him, and more importantly, for all of Ohio.”
Mr. Taft's tobacco troubles started brewing soon after a bipartisan task force endorsed his plan to share annual payments from cigarette makers with schools, anti-smoking programs, medical research, health programs and tobacco growers.
Some lawmakers argue the windfall should be given to taxpayers. They note that states sued the tobacco industry in part to recover money taxpayers spent to treat smoking-related illnesses.
Others fear that if the state doesn't get every dollar promised by cigarette makers, groups with a stake in Mr. Taft's plan would pressure lawmakers to make up the difference with tax dollars.
Underlying the debate, though, is the rancor from the General Assembly's attempt last year to satisfy an Ohio Supreme Court order to revamp the state's school-funding system.
“School people are always coming up and telling us if we spend just a little more, we'll satisfy the court,” said Sen. Scott Nein, R-Middletown. “Some of us frankly are getting tired of that way of thinking.”
Mr. Nein plans to offer an amendment that would put all the state's tobacco payments in a fund that temporarily lowers state income tax rates each year.
Another Republican senator, Lynn Wachtmann of Napoleon, wants to use some of the money to cut real estate taxes on agricultural land. Mr. Wachtmann has described the governor's plan as “socialistic.”
Mr. Taft and Republican legislative leaders don't like the tax-cut ideas. They say taxpayers would benefit if the state spent the tobacco payments on other things, such as anti-smoking programs, medical research and school construction.
“We would be better off using these dollars in the ways the task force recommended,” said Sen. Roy Ray, an Akron Republican who chairs the Senate Finance Committee.
Sen. Eric Fingerhut, D-Cleveland, said Democrats agree. “That's the document we voted on, and that's what we agreed to,” he said.
Ohio now is expected to get its first payment from the tobacco settlement, $121 million, next month. Lawmakers will decide how that money and subsequent annual payments ranging from $349 million to $403 million will be spent.
In some respects the current debate is moot because lawmakers can't legally tell future General Assemblies how to spend the state's money.
But with such an unprecedented pot of cash up for grabs, Mr. Taft, health groups and medical researchers think it would be politically difficult for lawmakers to significantly change the comprehensive plan they are pushing.
The finance committee won't vote on the bill until next week at the earliest, and possibly not until Nov. 9.
“We're going to keep talking,” said Senate President Richard Finan, R-Evendale. “But it's like I've been saying. The only thing more addictive than tobacco is the thought of spending all this tobacco money.”
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