Legislature(1999 - 2000)
03/11/1999 03:04 PM House HES
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE HEALTH, EDUCATION AND SOCIAL
SERVICES STANDING COMMITTEE
March 11, 1999
3:04 p.m.
MEMBERS PRESENT
Representative Fred Dyson, Co-Chair
Representative John Coghill, Co-Chair
Representative Jim Whitaker
Representative Joe Green
Representative Carl Morgan
MEMBERS ABSENT
Representative Tom Brice
Representative Allen Kemplen
COMMITTEE CALENDAR
* HOUSE BILL NO. 21
"An Act making a special appropriation for the medical assistance
for needy persons program and for certain programs relating to
tobacco smoking; and providing for an effective date."
- MOVED CSHB 21(HES) OUT OF COMMITTEE
* HOUSE BILL NO. 37
"An Act relating to smoking education and cessation programs
administered by the Department of Health and Social Services."
- MOVED CSHB 37(HES) OUT OF COMMITTEE
(* First public hearing)
PREVIOUS ACTION
BILL: HB 21
SHORT TITLE: APPROP: TOBACCO SETTLEMENT
SPONSOR(S): REPRESENTATIVES(S) ROKEBERG
Jrn-Date Jrn-Page Action
1/19/99 23 (H) PREFILE RELEASED 1/8/99
1/19/99 23 (H) READ THE FIRST TIME - REFERRAL(S)
1/19/99 23 (H) HES, FINANCE
3/11/99 (H) HES AT 3:00 PM CAPITOL 106
BILL: HB 37
SHORT TITLE: SMOKING CESSATION AND EDUCATION PROGRAMS
SPONSOR(S): REPRESENTATIVES(S) ROKEBERG
Jrn-Date Jrn-Page Action
1/19/99 27 (H) PREFILE RELEASED 1/8/99
1/19/99 27 (H) READ THE FIRST TIME - REFERRAL(S)
1/19/99 27 (H) HES
3/11/99 (H) HES AT 3:00 PM CAPITOL 106
WITNESS REGISTER
REPRESENTATIVE NORMAN ROKEBERG
Alaska State Legislature
Capitol Building, Room 24
Juneau, Alaska 99801
Telephone: (907) 465-4968
POSITION STATEMENT: Testified as sponsor of HB 21 and HB 37.
DOUGLAS GARDNER, Assistant Attorney General
Oil, Gas and Mining Section
Civil Division (Juneau)
Department of Law
P. O. Box 110300
Juneau, Alaska 99811
Telephone: (907) 465-3600
POSITION STATEMENT: Testified on HB 21 and HB 37.
KAREN PERDUE, Commissioner
Department of Health and Social Services
P. O. Box 110601
Juneau, Alaska 99811
Telephone: (907) 465-3030
POSITION STATEMENT: Testified on HB 21 and HB 37.
ELMER LINDSTROM, Special Assistant
Office of the Commissioner
Department of Health and Social Services
P. O. Box 110601
Juneau, Alaska 99811
Telephone: (907) 465-1610
POSITION STATEMENT: Answered questions on HB 21.
ANNE MARIE HOLEN
Alaska Native Health Board
4201 Tudor Center, Suite 105
Anchorage, Alaska 99508
Telephone: (907) 562-6006
POSITION STATEMENT: Testified in support HB 21 and HB 37.
CHRISTIE McINTIRE, Executive Director
American Lung Association of Alaska
1057 West Fireweed
Anchorage, Alaska 99504
Telephone: (907) 263-2086
POSITION STATEMENT: Testified in support of HB 21.
MICHAEL LIVINGSTON, Detective
Anchorage Police Department
4501 South Bragaw
Anchorage, Alaska 99507
Telephone: (907) 786-8764
POSITION STATEMENT: Testified in support of HB 21 and HB 37.
CHAD MORROW
4100 Cope Street, Number 2
Anchorage, Alaska 99503
Telephone: (907) 561-9839
POSITION STATEMENT: Testified in support of HB 21 and HB 37.
MARY ROZENZWEIG, Executive Director
Substance Abuse Directors Association
4111 Minnesota Drive
Anchorage, Alaska 99503
Telephone: (907) 770-2927
POSITION STATEMENT: Testified on HB 21 and HB 37.
ACTION NARRATIVE
TAPE 99-18, SIDE A
Number 0001
CO-CHAIRMAN DYSON called the House Health, Education and Social
Services Standing Committee meeting to order at 3:04. Members
present at the call to order were Representatives Dyson, Coghill,
Green and Morgan. Representative Whitaker joined the meeting at
3:05 p.m.
HB 21 - APPROP: TOBACCO SETTLEMENT
HB 37 - SMOKING CESSATION AND EDUCATION PROGRAMS
CO-CHAIRMAN DYSON announced the Committee would hear two bills
concurrently: House Bill No. 21, "An Act making a special
appropriation for the medical assistance for needy persons program
and for certain programs relating to tobacco smoking; and providing
for an effective date," and House Bill No. 37, "An Act relating to
smoking education and cessation programs administered by the
Department of Health and Social Services." Before the Committee,
but not yet adopted, was a proposed committee substitute (CS) for
HB 21, version 1-LS0185\H, Cook, 2/17/99 and a proposed CS for HB
37, version 1-LS0247\D, Ford, 2/22/99.
Number 0106
REPRESENTATIVE NORMAN ROKEBERG, Alaska State Legislature, sponsor
of HB 21 and HB 37, said he is here to represent the 110,000
smokers in the state of Alaska on the issue of allocation of
tobacco settlement monies. The amount of settlement money is $669
million over 25 years. The proposed CS for HB 21 is the allocation
bill and HB 37 is the program authority bill for Department of
Health and Social Services to undertake smoking control and
cessation programs.
REPRESENTATIVE ROKEBERG reported that in December of this year the
five tobacco companies that participated in this multi-billion
dollar settlement assessed a surcharge of 45 cents per pack of
cigarettes to smokers throughout the United States. As of December
1998, Alaskan smokers have paid approximately $18.5 million in
addition to the approximately $47.1 million from the $1-per pack
tobacco tax which was instituted in the last legislative session.
Additional taxes and surcharges amounting to approximately $65
million a year are being paid by the tobacco users of the state,
but only $200,000 is in the current budget for smoking programs.
The committee needs to put the money to equitable uses for the
people who pay this money, who suffer and who have the addictions.
Number 0402
REPRESENTATIVE ROKEBERG said today they will hear some numbers that
will make their decision easier. He said 80 percent of the smokers
in the state want to quit smoking. The lives of Alaska's smokers
depend on decisions made on this bill. He hopes the committee will
be the state's conscience and make a firm commitment to responsibly
appropriate in a way that in the long run is fair and will benefit
all Alaskans.
REPRESENTATIVE ROKEBERG mentioned there are a number of support
letters in the packets. Some of them refer to an $8.2 million
appropriation which represents approximately 30 percent of the
settlement. The proposed CS for HB 21 has a 50-50 allocation
between Medicaid and smoking programs. The 30 percent figure is an
approximation of the cost recommended by the Center for Disease
Control (CDC) for smoking control and cessation programs in Alaska.
Number 0584
CO-CHAIRMAN DYSON asked whether there were any objections to the
adoption of the proposed committee substitutes for HB 21 and HB 37
as work drafts. There being no objection, it was so ordered.
REPRESENTATIVE ROKEBERG clarified that the proposed CS for HB 21
has minor language changes. The proposed CS for HB 37 adds one
different section that was requested in the settlement, which
prohibits the sale of single cigarettes, and also lays out language
that gives the authority to the department to implement smoking
control and cessation programs.
DOUGLAS GARDNER, Assistant Attorney General, Oil, Gas and Mining
Section, Civil Division (Juneau), Department of Law, came forward
to testify. He gave an overview of the tobacco settlement where
Alaska and other states initiated litigation against the tobacco
industry based on expenses the state incurred treating
smoking-related illnesses. The claims were based on antitrust,
consumer protection and other common law negligence theories. They
filed the lawsuit in April 1997, and it was settled in November
1998. The settlement will result in $669 million paid out over 25
years. The first payment will be received by the state no later
than June 30, 2000. He said there are a number of issues still to
be dealt with. One of those issues is in SB 84, which is a model
statute which will protect the state's settlement from any
reductions as a result of smaller companies that did not
participate in the settlement; who might want to try and sell
cigarettes here taking a cost advantage of the fact they are not
part of the settlement.
REPRESENTATIVE GREEN asked if there would be any inflation due on
the subsequent payments.
MR. GARDNER answered it is a straight payment and averages about
$25 million per year. He will check and get back to the committee
to see if there is an inflation adjustment. He thinks there are
certain provisions of the settlement that do have inflation
provisions in them.
MR. GARDNER continued that the settlement contemplates that states
will enact a model statute. He wanted the members to be aware that
SB 84 will have the effect of protecting the state against any
adjustments as the result of the industries' losing market share.
The bill also serves a public health purpose of preventing smaller
companies from taking a cost advantage and dumping cheap cigarettes
on the Alaska market.
MR. GARDNER said there is currently vigorous discussion going on in
Washington, D.C., regarding the federal government's position and
claim related to the tobacco settlement. The Clinton
Administration has taken the position that a portion, perhaps as
much as 50 percent, is the federal government's share. Nationwide,
the attorneys general have rejected that position, and it is their
position that they sued for state dollars, not federal dollars.
They sued under state law theories, and the settlement dollars are
theirs. Currently there is legislation in Congress that may
correct that problem, and the Clinton Administration has agreed not
to make a claim on the first annual payment, so there is time for
the legislative process to fix that problem.
CO-CHAIRMAN DYSON asked what the small state settlement was.
MR. GARDNER replied that 13 small states took the position that
they should get more money than the allocation formula would yield
because tobacco reduction programs have fixed costs, and smaller
states are less able to bear those fixed costs than a state like
California that is getting a large chunk of money every year. That
view prevailed, and the state of Alaska received more money than it
would have under the allocation formula as a result of those
negotiations.
REPRESENTATIVE ROKEBERG asked if the small state supplement was for
the startup of the smoking control and cessation programs.
MR. GARDNER answered that there is no limitation in the settlement
that earmarks that money for that purpose; it is up to the
legislature to decide how to spend the money. Smoking cessation
was just one of the issues that the attorneys general were trying
to deal with in that whole argument on the small state settlement.
It was an argument about children's health care. One of the
premises of the litigation was that the industry for years has
targeted children in their advertising, and that children's health
care has suffered. The objective was to bring that money to the
small states in enough quantities to deal with all of those
problems.
REPRESENTATIVE ROKEBERG asked Mr. Gardner to explain the legal
theories.
MR. GARDNER explained that the legal theories advanced by his
office were primarily antitrust. The antitrust act prevents
companies from reaching an agreement to suppress safer products and
suppress health information from being made available to the public
so that they can make informed choices about what they are
consuming.
MR. GARDNER went on to say the state's case was also based on
consumer protection violations; it is a violation of the consumer
protection act for products to be marketed to persons underage and
without the appropriate information for them to know what they are
consuming. They also had negligence and negligence per se causes
of action based on contributing to the delinquency of a minor. It
is against the law in the state of Alaska to encourage a minor to
break the law, and they believe that the advertising that the
industry put together over the years encouraged a demand for
tobacco products in persons under 19 years of age.
MR. GARDNER said many states passed laws that specifically
authorized the attorneys general to make a Medicaid recoupment
claim, but the state of Alaska made no such claim.
REPRESENTATIVE GREEN asked if Alaska is in much better shape than
other states because Alaska did not have part of the settlement
attached by the federal government on Medicaid repayments.
MR. GARDNER said it was the Department of Law's position that it
does strengthen their argument, but obviously those arguments might
ultimately be tested.
REPRESENTATIVE GREEN said he thought Alaska was a part of a class
action against the tobacco industry, but this indicates that Alaska
stood alone; he wanted to know how Alaska can be part of a class
action as well as stand alone.
MR. GARDNER said the term "class action" is not the best way to
describe it. The small states negotiated for a settlement as a
group and settled the individual lawsuits in similar ways, but they
had individual lawsuits.
REPRESENTATIVE ROKEBERG refreshed Mr. Gardner's recollection of the
pleadings. He read a section on page 8 of the complaint which
says:
subsection (d) The defendants' conduct has wrongfully shifted
these increased costs of the State of Alaska in the form of
charges directly attributable to tobacco usage and exposure
that should have been borne by the defendants, including but
not limited to increased Medicaid payments.
REPRESENTATIVE ROKEBERG continued reading on page 118 which says:
a. Medical payments. Pursuant to AS 47.07.010 et seq.,
Alaska makes payments for medical care services provided to
recipients of public assistance. The amount paid for Medicaid
is higher than it would be due to overpayment for tobacco-
related illnesses:
REPRESENTATIVE ROKEBERG continued reading on page 119 which says:
the present value of Alaska's Medicaid expenses attributable
to smoking for the period of 1980 to 1993 exceeds $150
million.
REPRESENTATIVE ROKEBERG said it seems to him that the use of the
group theory of reimbursement for Medicaid expenses was also used
by the state of Alaska. He asked Mr. Gardner for clarification.
MR. GARDNER explained that as a result of the tobacco industry's
conduct, there were some costs that the state of Alaska bore as a
result of participating in the Medicaid program, but the damages
sued for were not based on the Medicaid payments. The damages they
were seeking were under the consumer protection and antitrust acts.
He has some handouts he will make available to the committee.
Number 1696
KAREN PERDUE, Commissioner, Department of Health and Social
Services, came forward to testify. She reflected that it is
positive to discuss doing something meaningful with these funds and
commented that it is an historic settlement. She has noticed that
other states are beginning to at least discuss using the funds for
public health, tobacco control and cessation areas, and children's
issues.
COMMISSIONER PERDUE agreed that it is disturbing and shocking that
the state has invested so little of the money they have already
received in taxation from tobacco in the smoking control programs.
$200,000 in state support is pretty low considering it is the
leading cause of preventable death in Alaska. She thanked Attorney
General Bruce Botelho and Doug Gardner for the amazing amount of
work they put into this settlement.
Number 1848
COMMISSIONER PERDUE shared the process the department went through
in proposing how they would make an historic contribution with the
money that is coming to the state from the settlement this year,
roughly $21 million; it does increase slightly over the next few
years, so there is room for additional dialogue. She referred to
a chart titled, "House Bill 21 Worksheet," in the packet that shows
the difference between this legislation and the Governor's current
budget proposal. The department has proposed a tobacco prevention
and control program of $3 million, which is a "partial way"
towards a comprehensive program; nonetheless, there is a plan for
the $3 million that does hit on each of the areas of school based
programs, enforcement and smoking cessation. The other area that
will use some of the funds in is in the health area; these funds
will go mostly to the Medicaid program and other health-related
costs necessary for working in the areas of protecting children and
helping families in the child abuse and neglect areas. The other
major area of difference is that they would invest around $5.7
million into continuation of the child protection agenda; mostly in
the area of foster care, residential care and some new workers.
Finally, $1.7 million would finish the work "annualizing their
workers' salaries, new workers they received and some adoption
funds."
COMMISSIONER PERDUE said they have a more detailed approach to the
$3 million that they would spend, and it would be consistent with
the $8 million approach, which is the ideal approach, in that most
of the money would go out to community organizations, to schools,
local law enforcement and so on. There would be some funds used
for evaluation and so on, but the intent is to get the money out
into the communities to continue with tobacco control work; that is
where kids are making their decisions about whether they want to
start using tobacco.
CO-CHAIRMAN DYSON said he understood that the CDC had recommended
that they spend somewhere between $8.5 million and $17 million; he
wondered why they had chosen not to do that.
COMMISSIONER PERDUE replied that the Governor wanted to do
something special with the funds but understood that there is a
budget condition. It almost can be looked at as bad timing because
of the demands on the money and every fiscal decision having to be
reviewed. The Governor wanted to continue with the child abuse and
fetal alcohol syndrome (FAS) agendas and felt that $3 million was
an adequate start. He also felt that there would be a way to
build on that program in the future. It was a tough choice because
there were so many uses for the $20 million.
REPRESENTATIVE GREEN asked if the programs covered by the tobacco
settlement are add-ons to the Governor's budget.
COMMISSIONER PERDUE affirmed that.
REPRESENTATIVE MORGAN asked what would be the impact on rural
Alaska if the other programs that were funded by the tobacco funds
were not funded with general funds.
COMMISSIONER PERDUE said they are all concerned how they are going
to balance their budget this year and still make some progress in
some of these difficult areas. She thinks that if they do not use
these funds for the highest priorities, then they will see enormous
pressure on parts of the budget that were not increased or were
reduced.
CO-CHAIRMAN DYSON said he thought Representative Morgan might be
assuming that the money was coming from only this source; however,
they will have funding from other sources.
COMMISSIONER PERDUE agreed that these are the only increases that
most of these programs would receive.
REPRESENTATIVE ROKEBERG asked if the grant applications to the CDC
and Federal Drug Administration (FDA) are over and above the
general fund component.
COMMISSIONER PERDUE answered that is correct.
REPRESENTATIVE ROKEBERG asked whether those grants have been made
or whether there have been applications for those grants.
COMMISSIONER PERDUE said they do have some ongoing federal sources,
foundation and federal dollars, and they are hoping to continue
that and increase some. They wanted to show the whole program,
which includes the federal dollars.
REPRESENTATIVE ROKEBERG said he was concerned about the creation of
more government positions funded by monies which could be used more
efficiently by contracting out to existing nonprofit groups, but he
wondered if the CDC has a special design for such a small state as
Alaska.
COMMISSIONER PERDUE answered that she thinks the CDC is interested
in making sure that there is enough capacity in the state to
evaluate what they are doing. There is a science to prevention,
and it works. The CDC is willing to pay for some of that for
Alaska.
REPRESENTATIVE ROKEBERG asked how the Governor and the Office of
Management and Budget are using this money. It appears to be what
is referred to as off-budget because the fiscal note is a zero
fiscal note. He wondered whether it is not being considered
general fund revenues because it is an outside source of funds, and
therefore doesn't create programmatic numbers.
COMMISSIONER PERDUE said she didn't know. She guessed that it was
in the budget as a tobacco settlement fund, so it wouldn't be on
the fiscal note.
REPRESENTATIVE ROKEBERG said the problem is the fact that they have
this outside money that raises the budget at a time when they need
to cut it.
Number 2284
ELMER LINDSTROM, Special Assistant, Office of the Commissioner,
Department of Health and Social Services, came forward to answer
questions. He said this is an unusual situation for an item to be
included in the Governor's budget. There is $3 million sitting in
the finance committee in the budget bill for exactly this purpose,
and there is a bill on this topic. The department believes that $3
million is the appropriate funding level, and in the fiscal note
they simply want to reference that it is in the Governor's budget.
Obviously it is in the power of the finance committee to suggest
that it should be on a fiscal note on the bill, as opposed to being
handled as a budget matter. His experience over the years is that
the finance committee won't be bashful about choosing which way to
go.
Number 2238
ANNE MARIE HOLEN, Alaska Native Health Board, came forward to
testify. She also represents the American Cancer Society, the
American Lung Association and the Heart Association. She has been
managing a small-scale tobacco control program at the Alaska Native
Health Board for four and a half years. She urged the committee
to support a fully funded comprehensive tobacco control program
that would build on the success they are seeing with the tobacco
tax, to ultimately push smoking rates below 15 percent, which is
the state goal. Now the prevalence rate is 27 percent among
adults, so getting from 27 percent to 15 percent represents quite
a challenge. If they fail to meet that challenge, it is estimated
that 4,000 young Alaskans will become daily smokers every year.
That represents about two to three classrooms of children each
week. Once addicted, most smokers remain addicted for years.
MS. HOLEN said half of all long-term smokers will die as a result
of smoking-caused disease, and half of those deaths occur in middle
age. The people who started as kids typically rack up thousands
or tens of thousands of dollars in medical bills for treatment of
respiratory illness, heart disease and cancer attributable to
smoking. Nonsmokers suffer as well. It is estimated that 7
percent of deaths among babies under a year old in this state are
due to passive smoking - maternal smoking during pregnancy and
smoking in the home after the baby is born. A portion of that is
sudden infant death syndrome and problems related to low-infant
birth weight. It does not include fetal deaths caused by maternal
smoking.
MS. HOLEN reported that she heard the director of the Massachusetts
control program say that he believes their program has paid for
itself in the cost savings just from the reduction of smoking and
low-birth weight babies since their program was implemented.
Smoking has been the leading cause of death in Alaska for some
time, yet it is only within the past year that the state has
appropriated any money toward tobacco control, and that was only
$200,000 last year. Meanwhile, the state is now bringing in around
$48 million a year from tobacco taxes and will soon be getting
another $25 million or more a year from the tobacco settlement.
MS. HOLEN mentioned that a statewide public opinion survey
conducted in October found that 77 percent of likely voters feel
that at least half of the settlement money should be spent on
programs to reduce tobacco use. Likewise, the CDC has issued
program and funding guidelines for each state and has recommended
that Alaska spend between $8.7 million and $17.7 million annually
for a comprehensive tobacco control program. That is a range from
about one-third to two-thirds of the tobacco settlement, so the
allocation of HB 21 is right in line with the CDC recommendations
and the wishes of the Alaskan public.
MS. HOLEN directed attention to a document called "The Alaska
Tobacco Control Program, A Plan for the Future" by The Alaska
Tobacco Alliance. Their plan identifies seven central components
that would be coordinated to work together for maximum
effectiveness. They tried to be realistic in the proposed funding
levels in light of the difficult fiscal challenge now. They are
proposing a program funded at $8.2 million as the minimum necessary
for an effective comprehensive program. Increasing this amount to
$12 or $13 million, as Representative Rokeberg has proposed, will
definitely provide more impact, and it is something they
wholeheartedly support.
MS. HOLEN noted the three main goals of this program: to reduce
initiation among youth, to help and encourage youths and adults to
quit smoking and to protect nonsmokers from second-hand smoke.
MS. HOLEN said community programs to reduce tobacco use illustrate
the decentralized approach that characterizes the entire program.
It is important to have capacity for centralized coordination and
leadership, but beyond that, the idea is to get the money out of
state government and into communities and organizations that can
work on the front lines.
MS. HOLEN reported that tobacco use in California has declined by
more than 40 percent since they enacted a 25-cent tobacco tax
increase and implemented a comprehensive program ten years ago.
Efforts to educate community members about youth access to tobacco,
second-hand smoke, the benefits of quitting and the tobacco
industry are greatly enhanced by a high-profile, well-funded,
ongoing, counter-marketing campaign that uses sophisticated
television and radio spots or other forms of media that make people
sit up and take notice. She showed videos of a few ads shown in
other states and one from Alaska.
MS. HOLEN said that the proposed $1 million budget for
counter-marketing sounds like a lot, but they can't win without
paid media. This statewide campaign is statewide, not just in a
particular house district. Counter-marketing is one of the
simplest and most effective things they can do within the overall
program, and it greatly enhances the effectiveness of all the other
activities because those messages are out there all the time.
MS. HOLEN went on to say that another central component to the
program is cessation services. Advice from health care providers
will help, and those providers are targeted within this program.
One characteristic of the cessation program is a statewide
toll-free "quit line" that smokers can call to get individualized
counseling and also be linked to support in the form of products:
the nicotine replacement therapy, the patch, the gum, the inhaler
and/or Zyban, which has been found to be highly effective.
Research has shown that these products, coupled with behavioral
counseling, can dramatically increase success in quitting. One-
year success rates range from 30 to 60 percent, as opposed to the
cold turkey method, which produces success rates of 3 to 6 percent.
The help is out there, but lack of knowledge about the different
options and the cost of the products are barriers to many people.
This program would remove those barriers by making sure every
quitter gets help and the products, regardless of the ability to
pay.
MS. HOLEN mentioned the other things important in the proposal:
school-based programs; tobacco-free partnerships that allow some
research; some innovative programs as well as core networking
functions; and enforcement of state laws regarding sales, vending
machines and collecting the tobacco tax. She pointed out that
currently sales to minors are only being enforced in four
communities. The CDC recommends that states commit 15 percent of
the overall budget to management and evaluation. This proposal
calls for less than 8 percent, so it is pretty lean in terms of
state bureaucracy. They feel it would be a mistake to cut it any
more.
MS. HOLEN concluded that they know that money spent on
comprehensive tobacco control programs is not wasted. It would be
wonderful ten years from now to be able to produce a report on the
Alaska tobacco control program that would include a graph showing
a dramatic decline in tobacco use in Alaska, with statistics about
lives and dollars saved in this state. She added that HB 21 and HB
37 can get there with the committee's support.
REPRESENTATIVE GREEN asked Ms. Holen if three times the money spent
on tobacco prevention and control would result in three times the
benefits.
MS. HOLEN said she was sure they would get more benefits by
spending more money because the more that is spent, the more
reduction will be seen.
REPRESENTATIVE WHITAKER asked if the 40 percent decrease in use in
California was for existing smokers who quit or new smokers.
MS. HOLEN said it includes all categories: smokers who quit, fewer
kids starting and people cutting back.
Number 1387
CHRISTIE McINTIRE, Executive Director, American Lung Association of
Alaska, testified via teleconference from Anchorage. The mission
of the American Lung Association is to prevent lung disease and
promote lung health. Although the tobacco settlement is weak in
the public health provision, they are excited at this historic
opportunity to invest in the future of Alaska. They feel the
returns will be many if they support HB 21 and have a comprehensive
tobacco control program funded at an adequate level.
MS. McINTIRE commented that it is amazing how everyone is affected
by tobacco smoke. She went on to say her mother smoked during
pregnancy, and she herself was a low birth weight baby. She grew
up in a home with two smokers and breathed second-hand smoke.
While growing up, she was an adamant nonsmoker but became a smoker;
she is now smoke-free but has asthma.
MS. McINTIRE said she thinks it should be kept in mind that $200
million was given to the small states in consideration of the costs
associated with implementing a comprehensive tobacco control
program. Currently there is a program for $200,000, but it is not
a new program. The program has been inadequately funded, and they
feel that the tobacco settlement dollars coming to this state
should be used for tobacco control, prevention and cessation
services. The American Lung Association supports HB 21 and feels
it will be a great investment in the future; these programs work.
Number 1238
MICHAEL LIVINGSTON, Detective, Anchorage Police Department (APD),
testified via teleconference from Anchorage. He told the committee
that in 1997 the APD began sting operations by sending 18-year-old
minors into stores. The APD checked 50 stores and wrote 35 tickets
for sale of tobacco to minors. The clerks were fined $300, and
many tobacco licenses were suspended. A check in 1998 indicated
that about 4 percent of the stores were selling tobacco to minors.
However, checks conducted in Anchorage in 1999 indicated that there
are still many stores in Anchorage selling tobacco to minors as
young as 16 years old. Even stores that were ticketed in 1997,
whose tobacco licenses were suspended for 45 days, continue to sell
tobacco to minors.
MR. LIVINGSTON said enforcement must continue or tobacco vendors
will revert to their old habits. Furthermore, funding must be
provided for enforcement of tobacco laws for the police departments
throughout Alaska, especially in northern Alaska, where almost 75
percent of the stores sell tobacco to kids with impunity.
MR. LIVINGSTON stressed that in 1999 teen smoking has become a
complex problem that is not going to be solved by one ticket
written by one police officer. It demands a strong community
response. He has reviewed the proposal for tobacco control,
including community programs, cessation programs and enforcement,
and he agrees that this multi-level approach makes excellent sense.
Today the leaders in Alaska have an opportunity to dramatically
impact the health, safety and education of future generations of
Alaskans. He urged members to support HB 21 and HB 37. He told
the committee that they have the opportunity to make Alaska the
healthiest place in the world. He would like to see it supported
at the $8.2 million level (30 percent level) for a comprehensive
tobacco prevention and cessation program.
Number 1135
REPRESENTATIVE ROKEBERG asked if there were any federal funds for
the enforcement done by the APD.
MR. LIVINGSTON said the stings in 1997 were done with assistance
from the attorney general's office with no additional funding
provided. Basically, they found the time in their busy schedules
to conduct those checks. The checks conducted in Anchorage now are
funded by the Food and Drug Administration (FDA).
Number 1077
CHAD MORROW testified via teleconference from Anchorage. He is 18
years old and started smoking when he was 12. He quit smoking
about ten weeks ago through a program offered by the Alaska Native
Health Board. He said it feels great to be a nonsmoker and to
breathe. He supports HB 21 and HB 37. He wanted to quit smoking
before it got too hard to quit later on, and it was one of the most
difficult things he has ever done. In the five week program he met
people who had had laryngectomies or who have emphysema or cancer.
The group of eight had to take lie detector tests to see who had
smoked or not. Four of them went thirty days without a cigarette.
If there were more smoking cessation programs, they might reach
more teens who really want to quit smoking but don't know how.
MR. MORROW stressed that people do need support in order to quit.
Instead of telling people they should have never started smoking,
it is better to give them support. At the time, he hadn't realized
the program offered as much support as it did. He didn't notice
how much he wanted a cigarette until the program was over.
MR. MORROW stated that someone needs to help young people quit
smoking and encourage younger ones not to start. This money from
the tobacco companies could be distributed to the people who need
the help. In the program, he learned the American Lung Association
motto, "If you can't breathe, nothing else matters," which made him
think that people just take their health for granted. He urged the
committee to please fund these programs; they can help people
realize that there is hope, and it is never too late to quit.
Number 0936
MARY ROZENZWEIG, Executive Director, Substance Abuse Directors
Association, said it is the wish of the substance abuse directors
that the final bill reflect the purpose of the settlement and
allocate money to tobacco-related programs and services most needed
in Alaska. Tobacco is a "gateway drug," and the substance abuse
directors are in support of seeing that a large portion of the
dollars goes towards prevention. A successful prevention program
now will reduce future expenses in both substance abuse treatments
and health care. Anecdotal evidence points out that 80 to 90
percent of persons in drug treatment programs are also tobacco
users. Earmarking some of the cessation dollars for programs that
deal with dually addicted persons will allow targeting dollars for
a population highly in need of intervention.
MS. ROZENZWEIG stated that there are a number of settlement
allocations that have been proposed which Commissioner Perdue has
already outlined, and they support the dollars to the fetal alcohol
syndrome prevention grant, the substance abuse treatment for women
and children in villages, and village mental health substance abuse
services. They believe these programs are in keeping with the
intent of the settlement. This is just the beginning of a
discussion for use of tobacco settlement dollars, and the substance
abuse directors offer any assistance needed in determining the most
appropriate use of the dollars.
REPRESENTATIVE WHITAKER asked Representative Rokeberg about funding
beyond July 1, 2000.
REPRESENTATIVE ROKEBERG answered that they cannot bind future
legislatures. The proposed CS for HB 21 is an allocation bill for
2000 and HB 37 gives authority which will remain in statute.
Number 0734
CO-CHAIRMAN DYSON closed the public testimony and called Doug
Gardner forward to present some amendments to the proposed CS for
HB 37.
DOUG GARDNER reported there has been a problem in the country as a
whole, called the gray market problem, which is when cigarettes
come back into the United States that are marked "for export only."
The cigarettes do not have the same formulation of tobacco, they
may have different nicotine levels and different chemicals, and
they don't have the FDA health warnings on them. In Representative
Rokeberg's bill, the attorney general's office saw an opportunity
to address the gray market issue within the context of the tobacco
endorsement and licensing statute. Amendment 1 would prohibit
somebody that holds a tobacco endorsement from selling a product
that is labeled "For Export Only" or "U.S. Tax Exempt" or that is
destined for a market outside the United States. Amendment 1 would
read:
Page 1, line 4:
Delete "a new subsection"
Insert "new subsections"
Page 1, following line 8:
Insert new subsections to read:
"(h) A person who is required to hold a business
license endorsement issued under this section, or an
agent or employee of the person, may not sell cigarettes,
as that term is defined in AS 43.50.170, if the cigarette
package
(1) does not comply with all of the
requirements of 15 U.S.C. 1331 - 1341 (Cigarette labeling
and Advertising Act), as amended, for the placement of
warnings or of any other information upon a package of
cigarettes that is sold within the United States;
(2) is labeled "For Export Only," "U.S.
Tax Exempt," "For Use Outside U.S.," or with similar
wording indicating that the manufacturer did not intend
that the product be sold in the United States;
(3) has been altered by masking or
deleting wording described in (2) of this subsection.
(i) A violation of provisions of (g) or (h) of this
section is an unfair or deceptive act or practice under
AS 45.50.471."
Number 512
CO-CHAIRMAN DYSON asked if Mr. Gardner wanted state law to cover
this since, it is already covered under federal law.
MR. GARDNER said it is covered to some degree under federal law.
The Federal Trade Commission (FTC) is charged with the enforcement
of the cigarette warning label issue, and technically cigarettes
coming back into the United States without that warning are not
supposed to be sold here. The FTC has never been challenged on
such a broad scale before in an enforcement effort, and it has
asked for help to buttress the efforts.
REPRESENTATIVE ROKEBERG said if he can accommodate the
administration and have more oars pulling on this bill, he has no
objections.
CO-CHAIRMAN COGHILL asked if there is any problem between federal
and state jurisdiction in enforcing this.
Number 0371
MR. GARDNER said he doesn't believe there would be any problem
there. The objectives are the same; they go about it in a slightly
different way, but their efforts should dovetail without any
conflict.
REPRESENTATIVE GREEN asked what happens when someone is selling
cigarettes in violation of federal and state laws.
Number 0222
MR. GARDNER said all the mechanisms for enforcement are civil
remedies. The Division of Occupational Licensing could take a
licensing action. In addition, the consumer protection act there
are penalties for violations which could potentially result in a
$5,000 fine for each violation. He would say that if they had a
consumer protection violation filing against the violator in
superior court, it would have their attention quickly, and they
would be able to stop the problem.
TAPE 99-19, SIDE A
Number 0001
CO-CHAIRMAN DYSON asked whether there were any objections to
Amendment 1. There being none, Amendment 1 was adopted.
Number 0027
MR. GARDNER went on to amend Amendment 1. The Department of
Revenue had suggested that subsection (h) be amended by adding the
words "or possesses" between "sell" and "cigarettes", so that the
subsection (h) would read:
Page 1, line 6
"(h) A person who is required to hold a business license
endorsement issued under this section or an agent or employee
of the person, may not sell or possess cigarettes, as that
term is defined in AS 43.50.170, if the package"
MR. GARDNER also proposed adding a new subsection (j), which would
read:
Page 1, line 20:
"(j) The commissioner, or commissioner's designee may
seize, destroy or sell to a manufacturer, for export only,
cigarettes with packages that don't comply with (g) and (h)
above."
Number 0152
CO-CHAIRMAN DYSON labeled that Amendment 2. He asked if there were
any objections to the amendment to the amendment which inserts the
words "or possesses" in line 7 between "sell" and "cigarettes". and
adds a new subsection (j) on line 20 of HB 37. He said he himself
would object to the words "or sell" in there and asked what the
will of the committee is.
REPRESENTATIVE GREEN asked Mr. Gardner why the words "or sell" are
in the bill.
Number 0287
MR. GARDNER indicated that the intention is to get the gray market
cigarettes out of the country by getting them back into the hands
of the companies who will do that. If, for example, they find some
Marlboro "for export only" cigarettes, Phillip Morris would be more
than happy to get rid of those cigarettes and get them back into an
export stream of commerce. They don't want the cigarettes to
remain in the state or be transferred to another state; they want
a mechanism to get rid of them.
MR. GARDNER expressed his understanding that Co-Chairman Dyson
doesn't like the idea that the state might sell the cigarettes to
generate revenue to offset the enforcement costs, but those are the
ways that the attorney general's office thought they could get them
back into the stream of commerce.
CO-CHAIRMAN COGHILL said he also would be in favor of taking the
"or sell" out for that particular reason.
REPRESENTATIVE WHITAKER asked whether it is correct that if the "or
sell" provision is taken out, then the cigarettes would be
destroyed.
CO-CHAIRMAN DYSON answered yes.
Number 0525
MR. GARDNER proposed changing the amendment to subsection (j) so
that it would read:
"(j) The Commissioner or commissioner's designee may
seize and destroy cigarette packages that don't comply with
(g) and (h) above."
Number 0552
CO-CHAIRMAN DYSON asked whether there were any objections to
Amendment 2 [relating to subsection (h) and (j)]. There being
none, Amendment 2 was adopted.
Number 0641
MR. GARDNER offered a third amendment for Section 1 of the proposed
CS for HB 37. He proposed the addition of the words "or is
required to" on page 1, line 5, so that it would read:
(g) A person who is required to hold a business license
endorsement under this section, or an agent or employee of the
person, may not sell or possess cigarettes to another person
unless the cigarettes are sold in groups of at least 20 and
the cigarettes are in the manufacturer's original cigarette
pack or contained in a cigarette carton or box.
Number 0699
CO-CHAIRMAN DYSON asked whether there were any objections to
Amendment 3. There being none, Amendment 3 was adopted.
CO-CHAIRMAN DYSON called an at-ease at 4:48 p.m. and called the
meeting back to order at 4:55 p.m.
Number 0775
REPRESENTATIVE ROKEBERG referred to a proposed a conceptual
amendment requested by the Department of Commerce and Economic
Development. He said it makes two changes in AS 43.70.075, License
endorsement. In the first line of the subsection (a) it would
remove the word "has" and insert "who is required to hold". This
is consistent with what the attorney general indicated, and it is
in the same section of the law. It indicates that a person is
supposed to have a business license, not just the fact that they
had a business license. Additionally, under subsection (d), after
the word "endorsement", it would add "and the right to sell tobacco
products".
Number 0861
CO-CHAIRMAN DYSON asked whether there were any objections to
Amendment 4. There being none, Amendment 4 was adopted.
Number 0999
REPRESENTATIVE ROKEBERG offered a fifth amendment requested by
Commissioner Perdue. On page 2, line 14 it would add the words
"grant or" after the word "by"; and on line 15, it would add "or
other" after "nonprofit". Subparagraph (15) would read:
(15) a comprehensive smoking education, tobacco use
prevention, and tobacco control program; to the maximum extent
possible, the department shall conduct the program required
under this paragraph by grant or contract with nonprofit or
other organizations in the state;
REPRESENTATIVE ROKEBERG explained that this would allow the
department to expand beyond a contract into a grant of monies and
include other organizations besides nonprofit organizations.
Number 1057
REPRESENTATIVE GREEN made a motion to adopt Amendment 5.
CO-CHAIRMAN DYSON asked whether there were any objections to
Amendment 5. There being none, Amendment 5 was adopted.
Number 1072
REPRESENTATIVE ROKEBERG commented that all these amendments before
the committee were not at the request of the bill sponsor but by
the Administration.
Number 1109
REPRESENTATIVE GREEN made a motion to move CSHB 37, version
1-LS0247\D, Ford, 2/22/99, as amended, out of committee with
individual recommendations and zero fiscal note(s). There being no
objection, CSHB 37(HES) moved out of the House Health, Education
and Social Services Committee.
Number 1113
CO-CHAIRMAN DYSON noted that the proposed CS for HB 21 is the
appropriations bill and is under the purview of the finance
committee. The Department of Health, Education and Social Services
had deferred debate to the finance committee.
Number 1158
REPRESENTATIVE GREEN made a motion to moved CSHB 21 version
1-LS0185\H, Cook, 2/17/99 out of committee with individual
recommendations and zero fiscal note. There being no objection,
CSHB 21(HES) moved out of the House Health, Education and Social
Services Committee. [CSHB 37(HES) moved out earlier.]
ADJOURNMENT
Number 1186
There being no further business before the committee, the House
Health, Education and Social Services Committee meeting was
adjourned at 5:05 p.m.
| Document Name | Date/Time | Subjects |
|---|