1999-02-19                     Senate Journal                      Page 0309
SB 84                                                                        
SENATE BILL NO. 84 BY THE SENATE RULES COMMITTEE                               
BY REQUEST OF THE GOVERNOR, entitled:                                          
                                                                               
An Act imposing certain requirements relating to                              
cigarette sales in this state by tobacco product                               
manufacturers, including requirements for escrow,                              
payment, and reporting of money from cigarette                                 
sales in this state; providing penalties for                                   
noncompliance with those requirements; and                                     
providing for an effective date.                                               
                                                                               
was read the first time and referred to the Health, Education and              
Social Services and Finance Committees.                                        
                                                                               
Zero fiscal notes published today from Department of Law,                      
Department of Revenue.                                                         
                                                                               
Governors transmittal letter dated February 19:                                
                                                                               
Dear President Pearce:                                                         
                                                                               
Cigarette smoking presents serious public health concerns to the state         
and its citizens. Recently, this Administration, along with virtually          
every other state, reached a monumental master settlement agreement            
with the leading tobacco producers. That agreement was approved by             
the Alaska Superior Court on February 9, 1999. Under the terms of              
the settlement, it is anticipated the State of Alaska will receive $670        
million over the next 25 years and will benefit from important                 
restrictions on advertising and other matters to address public health         
concerns.                                                                      
                                                                               
While this is an important step forward in addressing this significant         
health problem, the states that are parties to the agreement wanted            
to be sure the problem was more comprehensively addressed. This                
bill I transmit today would help do that by placing some                       
requirements on tobacco product manufacturers who sell cigarettes in           
the state but do not sign the settlement agreement.                            

1999-02-19                     Senate Journal                      Page 0310
SB 84                                                                        
Under this bill, the non-participating tobacco manufacturers will take         
responsibility for their share of the financial burden caused by their         
products by setting up escrow accounts to cover qualified claims for           
health-related concerns. The availability of the escrow money will             
better ensure a source of compensation for Alaskans while preventing           
those manufacturers from deriving large, short-term profits from sales         
in this state and then becoming judgment-proof before liability may            
arise. This bill is fair and puts all tobacco product manufacturers on         
an equal footing regarding cigarette sales in Alaska.                          
                                                                               
I urge your prompt and favorable action on this bill, as part of an            
overall solution to address this major public health concern.                  
                                                                               
					Sincerely,                                                                
					/s/                                                                       
					Tony Knowles                                                              
					Governor