05/01/1996 11:13 AM Senate FIN

                                                                               
  SENATE BILL NO. 210                                                          
                                                                               
       An  Act  relating to  taxes  on cigarettes  and tobacco                 
       products; and providing for an effective date.                          
                                                                               
  Co-chairman Halford directed that  SB 210 be brought  on for                 
  discussion.   SENATOR  JOHNNY ELLIS  came  before  committee                 
  advising  that the bill has broad public support which spans                 
  the political and  philosophical spectrum.   It even  enjoys                 
  majority  support  among  nicotine  users  in Alaska.    The                 
  legislation  also  has  "enormous health  implications"  and                 
  fiscal ramifications for the state in terms of revenues  and                 
  health care  costs.  Senator Ellis advised that he sponsored                 
  the bill as a  major health issue, especially as  it relates                 
  to young people.   He referenced backup materials  and urged                 
  passage of the bill.                                                         
                                                                               
                                                                               
  Senator Randy Phillips  referenced CSSB 210 (STA)  and noted                 
  inclusion of intent  language calling for allocation  of new                 
  revenues from the tax as follows:                                            
                                                                               
       1.   10 percent for an anti-tobacco campaign  targeting                 
            children.                                                          
                                                                               
       2.   10 percent for  prosecution of  those who sell  or                 
  supply         tobacco to children.                                          
                                                                               
       3.   80  percent for  state  support of  elementary and                 
  secondary           education.                                               
                                                                               
  and asked if the sponsor agreed with the foregoing.  Senator                 
  Ellis responded affirmatively.   He noted, however,  that as                 
  intent,  the  language  would  not   be  binding  on  future                 
  legislatures.                                                                
                                                                               
  FORMER SENATOR GLENN HACKNEY next  came before committee and                 
  voiced support for  the bill.  He asked that it be viewed as                 
  a health issue rather  than a revenue measure.   Mr. Hackney                 
  next attested to  the variety of  methods utilized by  those                 
  attempting to stop smoking.  One of the most effective means                 
  of discouraging  young people from  smoking is the  price of                 
  the product.   Cost discourages  children from starting  and                 
  encourages active smokers to quit.                                           
                                                                               
  The American Heart Association, the American Cancer Society,                 
  and the  American Lung  Association support  the bill.   The                 
  agenda for all three organizations is health  and the saving                 
  of  lives.     Seventy-one  out   of  one  hundred   Alaskan                 
  constituents  support the  legislation.   Mr.  Hackney urged                 
  support and passage.                                                         
                                                                               
  DON DAPCEVICH, Director, Advisory Board  on Alcohol and Drug                 
  Abuse,  next came before  committee in support  of the bill.                 
  He concurred in  comments by former Senator Hackney that the                 
  legislation should be  viewed as a prevention  effort rather                 
  than  a  revenue  issue.    Lessons  can   be  learned  from                 
  statistics evidencing what happened when the cost of tobacco                 
  was  increased  in  Canada.    Cost  increases  reduce  use,                 
  especially  among  young  people.    Mr.  Dapcevich  further                 
  attested to the  correlation between  tobacco use and  other                 
  drug   use.    He  urged  passage   of  the  proposed  bill,                 
  reiterating that  it represents a strong  prevention effort.                 
  In  his  closing  remarks,  he  voiced  support  for  intent                 
  language within  CSSB 210  (STA) and  praised dedication  of                 
  moneys  for both prevention and intervention efforts through                 
  the Dept. of Public Safety.                                                  
                                                                               
  ANNE MARIE  HOLEN, Citizens  to Protect  Kids from  Tobacco,                 
  next came  before committee  in support  of the  bill.   She                 
  explained that the group she represents is a  coalition that                 
  includes the American Cancer Society of Alaska, the American                 
                                                                               
                                                                               
  Lung  Association,  the American  Heart  Association, Alaska                 
  State Medical Association,  Nurses Association,  Association                 
  of  Alaska  School  Boards,  and  many  other groups.    She                 
  referenced  correspondence  to Senate  President  Pearce and                 
  House Speaker Gail  Phillips from former surgeon  general C.                 
  Everett Koop.   Dr. Koop is so busy  and in such demand that                 
  he rarely responds to  requests for assistance such  as that                 
  from Alaska.    He made an exception in this case because he                 
  feels what is  attempting to be  done is important for  both                 
  the state and  the nation.   Tobacco control experts are  in                 
  agreement  that  the  federal  government  should  raise its                 
  cigarette tax to $2.00  per pack or higher, and  every state                 
  should raise  its tax to  at least $1.00  per pack.   Alaska                 
  would  be the  first to  do  that and  would set  a positive                 
  example for other states to follow.  Dr. Koop noted that the                 
  foregoing could ultimately save millions of lives.                           
                                                                               
  Ms. Holen next  quoted from an  article written by Dr.  Koop                 
  during the campaign  for a 75-cent  increase in the  federal                 
  cigarette tax from the current 24-cents:                                     
                                                                               
       Senators and Congressmen should be happy to find a  tax                 
       that is  actually popular.   Polls show that  almost 80                 
       percent of Americans  (Republicans and Democrats, young                 
       and old, men and women) support  a large cigarette tax.                 
       So those members of Congress elected  on a no new taxes                 
       pledge can go along with this one.  Cigarette taxes are                 
       indeed different.                                                       
                                                                               
  Constituents do not understand why any legislator would balk                 
  at imposition of this tax.  This tax is different.                           
                                                                               
  Ms. Holen asked that members recognize the serious nature of                 
  tobacco--the  leading  cause of  death  in Alaska.    It has                 
  tremendous economic  impact, draining  hundreds of  millions                 
  from the economy each  year.  She urged that  members become                 
  part of the solution to the problem by supporting passage of                 
  SB 210.  In her closing remarks, she asked how often members                 
  have  the  opportunity    to  enact legislation  that  saves                 
  thousands of lives, raises revenue,  and enjoys support from                 
  a vast majority of constituents.                                             
                                                                               
  Senator  Sharp  MOVED for  passage  of CSSB  210  (STA) with                 
  individual recommendations and accompanying fiscal notes. No                 
  objection having been  raised, CSSB  210 (STA) was  REPORTED                 
  OUT  of  committee with  a  fiscal  note from  the  Dept. of                 
  Revenue showing  a cost  of $63.6  and projected  revenue of                 
  $33,426.8.  Co-chairman Frank and  Senators Rieger and Sharp                 
  signed the committee report with a "do pass" recommendation.                 
  Co-chairman  Halford  and  Senators  Donley,  Phillips,  and                 
  Zharoff signed "no recommendation."