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Earmarking Tobacco Settlement Provides Easy Out

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By Lowell L. Kalapa

With very little money left over in the general fund pot, lawmakers have been fascinated with the windfall of tobacco settlement monies as a new found source of money that they can spend.

When the settlement was reached, lawmakers in very statesmanlike fashion earmarked about two-thirds of the money to be spent on health related programs and education to prevent the usage of tobacco products. They set the rest of the funds – about 40% – aside to be placed into a “rainy day” fund which would be tapped only in the case of emergencies to address unforeseen problems.

Well, that emergency rainy day fund set aside has become a very attractive target for lawmakers to spend on their “worthy” causes. Among those causes are early childhood care and education. Indeed, nothing could be more important than to insure that the next generation of leaders has a good educational foundation. Another hot issue which has become a focus of funding from the tobacco settlement is substance abuse treatment. Again, a program worth of public support.

Unfortunately, what proponents of these efforts to earmark tobacco settlement monies fail to realize is that once the problem is “taken care of,” very little attention will be devoted to these issues in the future. Instead, future lawmakers will respond to future calls for funding of these programs by saying that they have the money from the tobacco settlement, just take more of those moneys for the early childhood programs or the substance abuse programs.

And there is proof positive that this will be the likely response. For example, lawmakers were somehow convinced that there was a reasonable relationship between domestic violence and the fees charged for marriage licenses. So a few years ago, the cost of a marriage license was doubled and the increased amount was earmarked for domestic violence programs.

Well, in a couple of years it became obvious that not enough money was being generated from the marriage license fees so proponents asked that lawmakers appropriate more money for those programs. With money so tight, lawmakers didn’t want to give up what little discretionary funds they had, so they responded by doubling the marriage license fee yet again.

That’s the other weakness of trying to earmark revenues from a source that has no relationship to the function it is being asked to fund. In the case of the marriage license fee, what relationship is there between getting married and beating up on one’s spouse or lover or for that matter abusing a child? When was the last time a marriage license was an indication of how often a person beats his or her spouse?

An appropriate earmarked tax or charge would be the state fuel tax which is imposed as so many cents per gallon. In that case, the more gallons of gasoline one purchases is reflected in how many miles that person or vehicle drives over the state’s roadways. The more gasoline purchased translates into more miles driven which means more wear and tear on the state’s roads. Thus the person who drives more will need more gasoline which means more gallons of fuel will be purchased and more fuel taxes will be collected from that driver.

So one must ask, what is the relationship between smoking and consumption of cigarettes and early childhood education? The other question to ask is whether or not 10% of settlement moneys is sufficient to carry out the programs essential to early childhood education? What if the amount that Hawaii realizes from the tobacco settlement is less than what had been anticipated so that the absolute dollar amount is far less than what is needed to fund programs for early childhood education?

If the money falls short of what is needed for early childhood education programs, will lawmakers merely increase the percentage of the settlement that is set aside for this program . . . and when they run out of settlement moneys will they have the political will to appropriate funds from the general fund or will they tell early childhood education advocates to raise their own money?

Earmarking tobacco settlement moneys for these programs is a clear indication that lawmakers do not think that early childhood education is of a high enough priority that is deserving of the state’s unconditional support through the appropriation of general funds.

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