Patrick Reynolds, Grandson of Tobacco Magnate, says Tobacco Securitization Proposal will Hurt Colorado’s Youth
DENVER, CO— Patrick Reynolds, President of Tobaccofree.org and grandson of tobacco company magnate RJ Reynolds, spoke out against the tobacco securitization proposal today at the State Capitol. Reynolds, an unlikely supporter of tobacco control due to his family’s role in the tobacco industry, has worked tirelessly for over two decades to promote a tobacco free society.
“Tobacco prevention and cessation programs have been proven to prevent future generations from smoking and have helped current smokers quit,” said Reynolds. “From 2000 – 2003 Colorado has seen a nearly 10% decrease in overall cigarette consumption, which is double the national average over that same time period. That kind of progress is something Colorado can’t afford to derail.”
Reynolds said that if the securitization proposal passes through the state legislature, it is unlikely that tobacco settlement money will be used as intended – to fund tobacco prevention programs that reduce youth smoking and save money for taxpayers by reducing smoking-caused health care costs.
Colorado health advocates agree.
“Tobacco securitization is not the fiscally prudent option,” said Chris Sherwin, Executive Director of the Colorado Tobacco Education and Prevention Alliance. “This deal is fiscally irresponsible, only benefits the rich bond holders, and at the same time hurts Colorado’s children.”
Under the securitization proposal, 35 years worth of tobacco settlement payments will be sold off to a bond company for a one-time lump sum payment of $800 million. This will leave Colorado with well under half of what it is owed from tobacco companies as part of the Master Settlement Agreement, ceding the difference to investment banking companies.
“Colorado’s economy seems to be turning the corner,” said Sherwin. “Yet the tobacco securitization proposal will not allow Colorado to reduce the over $1 billion in health care costs associated with tobacco in our state.”
Tobacco’s toll is devastating in Colorado – 25.3 percent of high school students currently smoke, 10,800 more kids become regular, daily smokers every year, and one-third of them will die prematurely. Every year, tobacco use kills 4,200 Colorado residents and costs the state over $1 billion in health care costs. Colorado will receive about $150 million in tobacco settlement and cigarette tax revenue in 2004. With just 16 percent of the settlement going to tobacco prevention and education programs, Colorado can still fund a tobacco prevention program at levels recommended by the U.S. Centers for Disease Control and Prevention.